Quarterly report pursuant to Section 13 or 15(d)

LONG-LIVED ASSETS

v3.5.0.2
LONG-LIVED ASSETS
 9 Months Ended
Sep. 30, 2016
LONG-LIVED ASSETS [Abstract]  
LONG-LIVED ASSETS
LONG-LIVED ASSETS
Definite-lived Intangible Assets
The Company has definite-lived intangible assets which are amortized over the shorter of either the lives of the respective agreements or the period of time the assets are expected to contribute to the Company’s future cash flows. The amortization is recognized on either a straight-line basis or in proportion to the asset’s expected cash flows.
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, 2016:
 
Revenue-
generating
contracts
 
Client /
vendor
relationships
 
Trademarks
and
naming
rights
 
Non-compete
agreements
 
Venue
management
and
leaseholds
 
Technology
 
Other
 
Total
 
(in thousands)
Balance as of December 31, 2015:
 
 
 
 
 
 
 
 
 
 
 
 
Gross carrying amount
$
700,795

 
$
379,282

 
$
86,556

 
$
176,354

 
$
66,051

 
$
30,265

 
$
3,598

 
$
1,442,901

Accumulated amortization
(313,743
)
 
(169,620
)
 
(14,578
)
 
(121,319
)
 
(35,645
)
 
(8,602
)
 
(1,631
)
 
(665,138
)
Net
387,052

 
209,662

 
71,978

 
55,035

 
30,406

 
21,663

 
1,967

 
777,763

Gross carrying amount:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Acquisitions— current year
48,912

 
51,211

 
—

 
—

 
1,449

 
8,604

 
413

 
110,589

Acquisitions— prior year
11,404

 
782

 
3,618

 
1,500

 
1,174

 
—

 
—

 
18,478

Dispositions
—

 
(2,299
)
 
—

 
—

 
(1,225
)
 
—

 
—

 
(3,524
)
Foreign exchange
(12,950
)
 
(1
)
 
(522
)
 
(2,998
)
 
(2,345
)
 
(340
)
 
2

 
(19,154
)
Other(1)
(10,717
)
 
(3,089
)
 
(6
)
 
(117,152
)
 
(9,600
)
 
(627
)
 
53

 
(141,138
)
Net change
36,649

 
46,604

 
3,090

 
(118,650
)
 
(10,547
)
 
7,637

 
468

 
(34,749
)
Accumulated amortization:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortization
(54,787
)
 
(47,129
)
 
(7,018
)
 
(15,190
)
 
(4,260
)
 
(4,276
)
 
(332
)
 
(132,992
)
Dispositions
—

 
599

 
—

 
—

 
22

 
—

 
—

 
621

Foreign exchange
4,991

 
(118
)
 
220

 
772

 
1,110

 
277

 
(22
)
 
7,230

Other(1)
10,772

 
3,089

 
—

 
117,227

 
9,600

 
627

 
22

 
141,337

Net change
(39,024
)
 
(43,559
)
 
(6,798
)
 
102,809

 
6,472

 
(3,372
)
 
(332
)
 
16,196

Balance as of September 30, 2016:
 
 
 
 
 
 
 
 
 
 
 
 
Gross carrying amount
737,444

 
425,886

 
89,646

 
57,704

 
55,504

 
37,902

 
4,066

 
1,408,152

Accumulated amortization
(352,767
)
 
(213,179
)
 
(21,376
)
 
(18,510
)
 
(29,173
)
 
(11,974
)
 
(1,963
)
 
(648,942
)
Net
$
384,677

 
$
212,707

 
$
68,270

 
$
39,194

 
$
26,331

 
$
25,928

 
$
2,103

 
$
759,210

______________
(1) Other 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 acquisition of a controlling interest in an artist management business with locations in the United States and Canada, controlling interests in festival and concert promoters located in the United Kingdom and the United States, and a digital content company located in the United States.
Included in the prior year acquisitions amounts above are definite-lived intangible assets primarily associated with the acquisition of a controlling interest in a festival promoter located in the United States.
The 2016 additions to definite-lived intangible assets from acquisitions have weighted-average lives as follows:
 
Weighted-
Average
Life (years)
Revenue-generating contracts
7
Client/vendor relationships
5
Venue management and leaseholds
5
Technology
5
All categories
6

Amortization of definite-lived intangible assets for the three months ended September 30, 2016 and 2015 was $47.8 million and $42.3 million, respectively, and for the nine months ended September 30, 2016 and 2015 was $133.0 million and $118.4 million, respectively. Amortization related to nonrecoupable ticketing contract advances for the three months ended September 30, 2016 and 2015 was $20.5 million and $22.4 million, respectively, and for the nine months ended September 30, 2016 and 2015 was $57.0 million and $55.2 million, respectively.
The following table presents the Company’s estimate of amortization expense for each of the five succeeding fiscal years for definite-lived intangible assets that exist at September 30, 2016:
 
(in thousands)
October 1 - December 31, 2016
$
46,174

2017
$
163,937

2018
$
142,989

2019
$
119,495

2020
$
99,868


As acquisitions and dispositions occur in the future and the valuations of intangible assets for recent acquisitions are completed, amortization may vary.
Goodwill
The following table presents the changes in the carrying amount of goodwill in each of the Company’s reportable segments for the nine months ended September 30, 2016:
 
Concerts
 
Sponsorship
& Advertising
 
Ticketing
 
Artist
Nation
 
Total
 
(in thousands)
Balance as of December 31, 2015:
 
 
 
 
 
 
 
 
 
Goodwill
$
602,771

 
$
332,081

 
$
733,825

 
$
340,501

 
$
2,009,178

Accumulated impairment losses
(386,915
)
 
—

 
—

 
(17,948
)
 
(404,863
)
                 Net
215,856

 
332,081

 
733,825

 
322,553

 
1,604,315

 
 
 
 
 
 
 
 
 
 
Acquisitions—current year
32,562

 
27,254

 
3,862

 
24,036

 
87,714

Acquisitions—prior year
(18,906
)
 
18,302

 
(108
)
 
449

 
(263
)
Dispositions
—

 
—

 
—

 
(323
)
 
(323
)
Foreign exchange
(25,067
)
 
5,468

 
1,475

 
(1,690
)
 
(19,814
)
 
 
 
 
 
 
 
 
 
 
Balance as of September 30, 2016:
 
 
 
 
 
 
 
 
 
Goodwill
591,360

 
383,105

 
739,054

 
362,973

 
2,076,492

Accumulated impairment losses
(386,915
)
 
—

 
—

 
(17,948
)
 
(404,863
)
                 Net
$
204,445

 
$
383,105

 
$
739,054

 
$
345,025

 
$
1,671,629


Included in the current year acquisitions amounts above is goodwill primarily associated with the acquisition of controlling interests in festival and concert promoters located in the United Kingdom and the United States, an artist management business with locations in the United States and Canada and a digital content company located in the United States.
Included in the prior year acquisitions amounts above are net reductions in goodwill resulting from changes in purchase price allocations of prior year acquisitions primarily related to the acquisition of a controlling interest in a festival promoter located in the United States and a venue management business in New Zealand.
The Company is in various stages of finalizing its acquisition accounting for recent acquisitions, which 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 its allocation between segments.
Investments in Nonconsolidated Affiliates
The Company reviews its investments in nonconsolidated affiliates for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. For the nine months ended September 30, 2016, the Company recorded impairment charges related to these investments of $15.1 million as equity in losses (earnings) of nonconsolidated affiliates, primarily related to investments in a digital content company and an online merchandise company that are located in the United States. See Note 3—Fair Value Measurements for further discussion of the inputs used to determine the fair values. There were no significant impairments of investments in nonconsolidated affiliates for the comparable period of 2015.