Goodwill and Other Identifiable Intangible Assets

12 Months Ended

Jun. 30, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Identifiable Intangible Assets

In accordance with ASC 350, Intangibles - Goodwill and Other Intangible Assets, the Company performs its annual goodwill impairment test during the fourth quarter of each fiscal year, or whenever indicators of impairment are present. The reporting units utilized for goodwill impairment tests align directly with our operating segments, Worldwide Barcode, Networking & Security and Worldwide Communications & Services. The testing includes the determination of each reporting unit's fair value using a discounted cash flows model compared to each reporting unit's carrying value. Key assumptions used in determining fair value include projected growth and operating margin, working capital requirements and discount rates. During fiscal years ended June 30, 2021 and 2019, no impairment charges related to goodwill were recorded. For the fiscal year ended June 30, 2020, the Company's projected growth and operating margins were impacted by the worldwide economic hardships created by COVID-19 and as such recognized a goodwill impairment charge of $119.0 million for our Worldwide, Barcode, Networking and Security reporting unit, which is recorded to the impairment charges line item in the Consolidated Income Statements.

Changes in the carrying amount of goodwill for the years ended June 30, 2021 and 2020, by reportable segment, are set forth in the table below. Additions to goodwill for fiscal year 2020 are due to the recent acquisitions.


	Worldwide Barcode, Networking & Security Segment		Worldwide Communications & Services Segment		Total
	(in thousands)
Balance at June 30, 2019	$	135,965	$	174,750	$	310,715
Additions	—		30,445		30,445
Goodwill impairment charges	(119,037)		—		(119,037)
Unrealized loss on foreign currency translation	(558)		(7,277)		(7,835)
Balance at June 30, 2020	$	16,370	$	197,918	$	214,288


Unrealized gain on foreign currency translation	—		4,589		4,589
Balance at June 30, 2021	$	16,370	$	202,507	$	218,877

The following table shows the Company’s identifiable intangible assets as of June 30, 2021 and 2020, respectively.


	June 30, 2021						June 30, 2020
	Gross Carrying Amount		Accumulated Amortization		Net Book Value		Gross Carrying Amount		Accumulated Amortization		Net Book Value
	(in thousands)
Amortized intangible assets:
Customer relationships	$	139,262	$	68,716	$	70,546	$	137,146	$	56,107	$	81,039
Trade names	19,750		10,102		9,648		19,509		7,617		11,892
Non-compete agreements	2,410		2,271		139		2,410		1,711		699

Supplier partner program	4,085		1,621		2,464		4,085		1,191		2,894
Encryption key library	19,900		9,743		10,157		19,900		7,255		12,645
Developed technology	15,165		3,259		11,906		14,004		1,626		12,378
Total intangibles	$	200,572	$	95,712	$	104,860	$	197,054	$	75,507	$	121,547

During fiscal year 2020, the Company acquired customer relationships, trade names and developed technology related to the acquisition of intY. Also during fiscal year 2020, the Company recorded $1.4 million in impairment charges in customer relationships, trade names and non-compete agreements related to the acquisition of Canpango. This charge is included in the impairment charges line item in the Consolidated Income Statements. The Company also disposed of fully amortized trade names and non-compete agreements from prior acquisitions. No impairment charges were recognized in fiscal years ended June 30, 2021 and June 30, 2019.

The weighted-average amortization period for all intangible assets was approximately 10 years for the year ended June 30, 2021, compared to 10 years for the year ended June 30, 2020 and 9 years for the year ended June 30, 2019. Amortization expense for continuing operations for the years ended June 30, 2021, 2020 and 2019 was $19.5 million, $20.0 million and $17.9 million, respectively, all of which relates to selling, general and administrative costs, not the cost of selling goods, and has been presented as such in the accompanying Consolidated Income Statements.

Estimated future amortization expense is as follows:


	Amortization Expense
	(in thousands)
Year Ended June 30,
2022	$	17,962
2023	17,021
2024	16,917
2025	16,917
2026	13,032
Thereafter	23,011
Total	$	104,860