XML 80 R34.htm IDEA: XBRL DOCUMENT v3.19.3
Goodwill and Other Intangible Assets, Net (Tables)
 9 Months Ended
Sep. 30, 2019
Indefinite-lived Intangible Assets [Line Items]  
Schedule of Indefinite-Lived Intangible Assets by Segment The impairment charges were allocated to the Company’s reporting segments as follows (in millions):
 
Three Months Ended September 30,
Impairment of indefinite-lived intangibles assets (1)
2019 (1)
2018 (2)
Appliances and Cookware
$
606.9

$
1,185.0

Food and Commercial
—

454.7

Home and Outdoor Living
217.1

2,385.1

Learning and Development
—

246.0

 
$
824.0

$
4,270.8


(1)
In the Appliances and Cookware segment, the impairment charge was recorded within the Appliances and Cookware reporting unit. In the Home and Outdoor Living segment, impairment charges of $151 million and $65.8 million were recorded within the Home Fragrance and Outdoor and Recreation reporting units, respectively. The carrying value of certain Appliances and Cookware trade names exceeded their fair value primarily due to the recently announced tariffs on Chinese imports as well as a decline in sales volume due to a loss in market share for certain appliance categories driven by the success of newly launched competitive products. Both of these factors resulted in downward revisions to forecasted results. The carrying value of certain Home and Outdoor Living trade names exceeded their fair value primarily within the Home Fragrance reporting unit. The reporting unit has begun to experience a shift in product mix that is expected to continue into the future, which resulted in a downward revision to forecasted results for one of its trade names.
Given the current trade negotiations with China and the uncertainties regarding the potential impact on the Company's business, there can be no assurance that the Company's estimates and assumptions regarding the impact of tariffs made for purposes of the goodwill and indefinite-lived intangible asset impairment test during the third quarter of 2019 will prove to be accurate predictions of the future. If the Company's assumptions regarding forecasted cash flow and revenue and operating income growth rates of certain reporting units are not achieved, it is possible that a material impairment charge may be required in the future.

(2)
In the Appliances and Cookware segment, impairment charges of $1.2 billion were recorded within the Appliances and Cookware reporting unit. In the Food and Commercial segment, impairment charges of $455 million were recorded within the Food and Commercial reporting unit. In the Home and Outdoor Living segment, impairment charges of $1.7 billion, $630 million and $75.0 million were recorded within the Home Fragrance, Outdoor and Recreation and Connected Home and Security reporting units, respectively. In the Learning and Development segment, the impairment charge recorded was attributable to the Baby reporting unit. These impairment charges were recorded as a result of the Company’s impairment testing, and resulted primarily from a decrease in the Company’s market capitalization during the three months ended September 30, 2018 and a deterioration of expected future revenues and margins related to certain tradenames within these segments.
Summary of Changes in Goodwill by Reportable Business Segment
Goodwill activity for the nine months ended September 30, 2019 is as follows (in millions):
 
 
September 30, 2019
Segments
Net Book Value at December 31,
2018
 
Purchase
Accounting
Adjustments
 
Impairment Charges
 
Foreign
Exchange and Other
 
Gross
Carrying
Amount
 
Accumulated
Impairment
Charges
 
Net Book
Value
Appliances and Cookware
$
211.2

 
$
1.8

 
$
(1.8
)
 
$
(0.1
)
 
$
751.8

 
$
(540.7
)
 
$
211.1

Food and
Commercial
722.7

 
2.3

 
(2.3
)
 
23.8

 
2,096.1

 
(1,349.6
)
 
746.5

Home and Outdoor Living
163.8

 
5.7

 
(5.7
)
 
(0.3
)
 
2,154.2

 
(1,990.7
)
 
163.5

Learning and Development
2,595.2

 
0.6

 
(0.6
)
 
(29.3
)
 
3,412.5

 
(846.6
)
 
2,565.9

Other
—

 
0.2

 
—

 
(0.2
)
 
—

 
—

 
—

 
$
3,692.9

 
$
10.6

 
$
(10.4
)
 
$
(6.1
)
 
$
8,414.6

 
$
(4,727.6
)
 
$
3,687.0
Schedule of Other Intangible Assets and Related Amortization Periods
Other intangible assets, net are comprised of the following as of the dates indicated (in millions):
 
September 30, 2019
 
December 31, 2018
 
 
 
Gross
Carrying
Amount
 
Accumulated Amortization 
 
Net Book
Value 
 
Gross
Carrying
Amount 
 
Accumulated
Amortization 
 
Net Book
Value 
 
Amortization
Periods
(in years)
Trade names — indefinite life
$
3,239.5

 
$
—

 
$
3,239.5

 
$
4,093.1

 
$
—

 
$
4,093.1

 
N/A
Trade names — other
167.0

 
(45.6
)
 
121.4

 
170.6

 
(36.5
)
 
134.1

 
2-15
Capitalized software
570.9

 
(417.6
)
 
153.3

 
552.1

 
(373.1
)
 
179.0

 
3-12
Patents and intellectual property
135.1

 
(95.5
)
 
39.6

 
137.6

 
(79.8
)
 
57.8

 
3-14
Customer relationships and distributor channels
1,295.2

 
(260.6
)
 
1,034.6

 
1,303.3

 
(214.6
)
 
1,088.7

 
3-30
Other
109.0

 
(95.1
)
 
13.9

 
109.0

 
(74.3
)
 
34.7

 
3-5
 
$
5,516.7

 
$
(914.4
)
 
$
4,602.3

 
$
6,365.7

 
$
(778.3
)
 
$
5,587.4