Quarterly report pursuant to Section 13 or 15(d)

LONG-LIVED ASSETS

v3.19.3
LONG-LIVED ASSETS
9 Months Ended
Sep. 30, 2019
LONG-LIVED ASSETS [Abstract]  
LONG-LIVED ASSETS LONG-LIVED ASSETS
Definite-lived Intangible Assets
The following table presents the changes in the gross carrying amount and accumulated amortization of definite-lived intangible assets for the nine months ended September 30, 2019:
Revenue-
generating
contracts
Client /
vendor
relationships
Trademarks
and
naming
rights
Technology
Other (1)
Total
(in thousands)
Balance as of December 31, 2018:
Gross carrying amount
$ 692,963    $ 393,772    $ 123,707    $ 85,411    $ 120,163    $ 1,416,016   
Accumulated amortization
(391,002)   (213,599)   (41,808)   (38,826)   (69,330)   (754,565)  
Net 301,961    180,173    81,899    46,585    50,833    661,451   
Gross carrying amount:
Acquisitions—current year
100,416    25,639    1,632    7,794    60,145    195,626   
Acquisitions—prior year
—    —    —    —    43    43   
Foreign exchange (14,694)   (3,937)   (845)   (419)   (2,160)   (22,055)  
Other (2)
(71,601)   (37,748)   76    (8,530)   (19,413)   (137,216)  
Net change 14,121    (16,046)   863    (1,155)   38,615    36,398   
Accumulated amortization:
Amortization
(75,596)   (43,999)   (10,097)   (19,957)   (16,391)   (166,040)  
Foreign exchange 5,560    2,483    362    377    976    9,758   
Other (2)
71,580    37,747    (54)   8,529    19,421    137,223   
Net change 1,544    (3,769)   (9,789)   (11,051)   4,006    (19,059)  
Balance as of September 30, 2019:
Gross carrying amount
707,084    377,726    124,570    84,256    158,778    1,452,414   
Accumulated amortization
(389,458)   (217,368)   (51,597)   (49,877)   (65,324)   (773,624)  
Net $ 317,626    $ 160,358    $ 72,973    $ 34,379    $ 93,454    $ 678,790   
______________
(1) Other primarily includes intangible assets for non-compete, venue management and leasehold agreements.  
(2) Other primarily includes netdowns of fully amortized or impaired assets.
Included in the current year acquisitions amounts above are definite-lived intangible assets primarily associated with the acquisitions of a festival promotion business located in Brazil that had been accounted for as an equity method investment, venue management businesses located in Belgium, the United States and Canada, festival promotion businesses located in the United States and Finland, a ticketing business located in Australia and an artist management business located in the United States.
The 2019 additions to definite-lived intangible assets from acquisitions have weighted-average lives as follows:
Weighted-
Average
Life (years)
Revenue-generating contracts 8
Client/vendor relationships 4
Trademarks and naming rights 3
Technology 2
Other 9
All categories 7
We test for possible impairment of definite-lived intangible assets whenever events or circumstances change, such as a significant reduction in operating cash flow or a change in the manner in which the asset is intended to be used, which may indicate that the carrying amount of the asset may not be recoverable. During the nine months ended September 30, 2019, we reviewed the carrying value of certain definite-lived intangible assets that management determined had an indicator that future operating cash flows may not support their carrying value, and it was determined that those assets were impaired since the estimated undiscounted operating cash flows associated with those assets were less than their carrying value. For the nine months ended September 30, 2019, we recorded impairment charges related to definite-lived intangible assets of $19.4 million as a component of depreciation and amortization. These impairment charges primarily related to intangible assets for revenue-generating contracts in the Concerts segment. See Note 4—Fair Value Measurements for further discussion of the inputs used to determine the fair value. There were no significant impairment charges recorded during the nine months ended September 30, 2018.
Amortization of definite-lived intangible assets for the three months ended September 30, 2019 and 2018 was $69.3 million and $51.4 million, respectively, and for the nine months ended September 30, 2019 and 2018 was $166.0 million and $143.5 million, respectively.
The following table presents our estimate of amortization expense for each of the five succeeding fiscal years for definite-lived intangible assets that exist at September 30, 2019:
(in thousands)  
October 1 - December 31, 2019 $ 48,212   
2020 $ 164,235   
2021 $ 125,521   
2022 $ 97,365   
2023 $ 81,030   

As acquisitions and dispositions occur in the future and the valuations of intangible assets for recent acquisitions are completed, amortization will vary.
Goodwill
The following table presents the changes in the carrying amount of goodwill in each of our reportable segments for the nine months ended September 30, 2019:
Concerts Ticketing Sponsorship
& Advertising
Total
(in thousands)
Balance as of December 31, 2018:
Goodwill $ 1,094,604    $ 762,953    $ 400,749    $ 2,258,306   
Accumulated impairment losses (435,363)   —    —    (435,363)  
                 Net 659,241    762,953    400,749    1,822,943   
Acquisitions—current year 46,648    4,017    51,237    101,902   
Acquisitions—prior year 8,827    —    —    8,827   
Foreign exchange (10,889)   (3,458)   (4,110)   (18,457)  
Balance as of September 30, 2019:
Goodwill 1,139,190    763,512    447,876    2,350,578   
Accumulated impairment losses (435,363)   —    —    (435,363)  
                 Net $ 703,827    $ 763,512    $ 447,876    $ 1,915,215   

Included in the current year acquisitions amounts above are goodwill primarily associated with the acquisition of a festival promotion business located in Brazil that had been accounted for as an equity method investment and venue management businesses located in Belgium and Canada.
We are in various stages of finalizing our acquisition accounting for recent acquisitions, which may include the use of external valuation consultants, and the completion of this accounting could result in a change to the associated purchase price allocations, including goodwill and our allocation between segments.