Goodwill and Intangible Assets

12 Months Ended

Sep. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

The Company performed its goodwill impairment test as of September 30, 2014 and 2013, and determined that no adjustment to goodwill was necessary. As of September 30, 2014, the fair value of all reporting units substantially exceeded the respective carrying values. The observable inputs used in the Company's DCF Method for the reporting units include discount rates at our above the Company's weighted-average cost of capital. The Company derives discount rates that are commensurate with the risks and uncertainties inherent in the respective businesses and its internally developed projections of future cash flows. In addition, the Company determined the terminal value using the Gordon growth method which assumes that the reporting unit will grow and generate free cash flow at a constant rate. The Company believes that the Gordon growth method is the most appropriate method for determining the terminal value because the terminal value is calculated at the point in which the Company has assumed that the reporting units have reached stable growth rates.

The components of the Company’s goodwill, excluding amounts related to the discontinued operations, by business segment at September 30, 2014 and 2013 are as follows (in thousands):



	Brooks Product Solutions			Brooks Global Services			Brooks Life Science Systems			Other			Total
Gross goodwill at September 30, 2012	$	461,738		$	151,238		$	40,302		$	26,014		$	679,292
Acquisitions and adjustments during fiscal year 2013	20,899			5,554			7,137			—			33,590
Gross goodwill at September 30, 2013	482,637			156,792			47,439			26,014			712,882
Acquisitions and adjustments during fiscal year 2014	11,638			—			(61		)	—			11,577
Gross goodwill at September 30, 2014	$	494,275		$	156,792		$	47,378		$	26,014		$	724,459
Accumulated goodwill impairments at September 30, 2012	$	(437,706	)	$	(151,238	)	$	—		$	(26,014	)	$	(614,958	)
Impairments recorded during fiscal year 2013	—			—			—			—			—
Accumulated goodwill impairments at September 30, 2013	(437,706		)	(151,238		)	—			(26,014		)	(614,958		)
Impairments recorded during fiscal year 2014	—			—			—			—			—
Accumulated goodwill impairments at September 30, 2014	$	(437,706	)	$	(151,238	)	$	—		$	(26,014	)	$	(614,958	)
Goodwill, less accumulated impairments at September 30, 2013	$	44,931		$	5,554		$	47,439		$	—		$	97,924
Goodwill, less accumulated impairments at September 30, 2014	$	56,569		$	5,554		$	47,378		$	—		$	109,501

The Company is required to test certain long-lived assets when indicators of impairment are present. The Company determined that impairment indicators were present for the long-lived assets related to the Celigo product line as of September 30, 2013. The long-lived assets in question were tested for recoverability by comparing the sum of the undiscounted cash flows directly attributable to the assets to their carrying values, which resulted in the conclusion that the carrying amounts of the assets were not recoverable. The fair values of the assets were then evaluated to determine the amount of the impairment, if any. The fair value of the assets was based primarily on market-based valuation techniques. As a result of this analysis, management determined that an impairment loss of $2.0 million had occurred as of September 30, 2013, and allocated the loss amount to the long-lived assets in the impaired asset group based on the carrying value of each asset, with no asset reduced below its respective fair value. The Company revised its estimate of the fair value of these assets in the first fiscal quarter of 2014 and determined that an additional impairment loss of $0.4 million, representing the remaining carrying value of the long-lived assets, was required. These impairment losses were recorded in the Brooks Life Science Systems segment. The impairment charge was allocated in the Consolidated Statements of Operations for the fiscal years ended September 30, 2014 and 2013 as follows (in thousands):



	Year Ended September 30,
	2014		2013
Reported as cost of revenue:
Completed technology intangible asset impairment	$	398	$	1,910

Reported as selling, general and administrative expense:
Trademarks and trade name intangible asset impairment	—		50
Total impairment charges	$	398	$	1,960

The Company completed the sale of the Celigo product line in the second quarter of fiscal year 2014. The sale of the Celigo product line did not have a material impact on the Company's financial position or result of operations.

Components of the Company’s identifiable intangible assets, excluding amounts related to the discontinued operations, as of September 30, 2014 and 2013 are as follows (in thousands):



	September 30, 2014						September 30, 2013
	Cost		Accumulated Amortization		Net Book Value		Cost		Accumulated Amortization		Net Book Value
Patents	$	7,808	$	7,300	$	508	$	7,808	$	7,196	$	612
Completed technology	57,155		41,539		15,616		57,050		40,354		16,696
Trademarks and trade names	3,496		3,496		—		3,564		3,554		10
Customer relationships	73,389		29,963		43,426		66,687		23,917		42,770
	$	141,848	$	82,298	$	59,550	$	135,109	$	75,021	$	60,088

Amortization expense, excluding amounts related to the discontinued operations, for intangible assets was $10.6 million, $9.8 million and $6.7 million for the fiscal years ended September 30, 2014, 2013 and 2012, respectively.

Estimated future amortization expense for the intangible assets recorded by the Company as of September 30, 2014 is as follows (in thousands):



Year ended September 30,
2015	$	11,555
2016	10,240
2017	9,536
2018	7,229
2019	6,660
Thereafter	14,330
	$	59,550

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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