Quarterly report pursuant to Section 13 or 15(d)

Note 4 - Goodwill, Customer Relationships and Other Intangible Assets

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Note 4 - Goodwill, Customer Relationships and Other Intangible Assets
9 Months Ended
Dec. 30, 2012
Goodwill and Intangible Assets Disclosure [Text Block]
Note 4 – Goodwill, Customer Relationships and Other Intangible Assets

Goodwill:  The Company reported goodwill of $1.1 million at December 30, 2012 and April 1, 2012.  The Company tests the fair value of the goodwill, if any, within its reporting units annually as of the first day of the Company’s fiscal year.  An additional interim impairment test is performed during the year whenever an event or change in circumstances occurs that suggests that the fair value of the goodwill of either of the reporting units of the Company has more likely than not (defined as having a likelihood of greater than 50%) fallen below its carrying value.  The annual or interim impairment test is performed by first assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount.  If such qualitative factors so indicate, then the impairment test is continued in a two-step approach.  The first step is the estimation of the fair value of each reporting unit to ensure that its fair value exceeds its carrying value.  If step one indicates that a potential impairment exists, then the second step is performed to measure the amount of an impairment charge, if any.  In the second step, these estimated fair values are used as the hypothetical purchase price for the reporting units, and an allocation of such hypothetical purchase price is made to the identifiable tangible and intangible assets and assigned liabilities of the reporting units.  The impairment charge is calculated as the amount, if any, by which the carrying value of the goodwill exceeds the implied amount of goodwill that results from this hypothetical purchase price allocation.

The annual impairment test of the fair value of the goodwill of the reporting units of the Company was performed as of April 2, 2012, and the Company concluded that the fair value of the goodwill of the Company’s reporting units substantially exceeded their carrying values as of that date.

Other Intangible Assets:  Other intangible assets at December 30, 2012 consisted primarily of the capitalized costs of recent acquisitions, other than tangible assets, goodwill and assumed liabilities.  The carrying amount and accumulated amortization of the Company’s other intangible assets as of December 30, 2012, their estimated useful life, the amortization expense for the three and nine-month periods ended December 30, 2012 and January 1, 2012 and the classification of such amortization expense within the accompanying consolidated financial statements of income are as follows (in thousands):

         
Estimated
Useful
         
Amortization Expense
 
   
Carrying
   
Life
   
Accumulated
   
Three-Month Periods Ended
   
Nine-Month Periods Ended
 
   
Amount
    (years)    
Amortization
   
December 30, 2012
   
January 1, 2012
   
December 30, 2012
   
January 1, 2012
 
                                           
Kimberly Grant Acquisition on December 29, 2006:
                                                       
Tradename
  $ 466       15     $ 187     $ 8     $ 7     $ 24     $ 23  
Existing designs
    36       1       36       -       -       -       -  
Non-compete covenant
    98       15       39       1       2       5       5  
Total Kimberly Grant Acquisition
    600       14 *     262       9       9       29       28  
                                                         
Springs Baby Products Acquisition on November 5, 2007:
                                                       
Licenses & existing designs
    1,655       2       1,655       -       -       -       -  
Licenses & future designs
    1,847       4       1,847       -       39       -       269  
Non-compete covenant
    115       4       115       -       3       -       17  
Customer relationships
    3,781       10       1,953       94       94       283       284  
Total Springs Baby Acquisition
    7,398       7 *     5,570       94       136       283       570  
                                                         
Neat Solutions Acquisition on July 2, 2009:
                                                       
Trademarks
    892       15       208       14       15       44       45  
Designs
    33       4       29       2       2       6       6  
Non-compete covenant
    241       5       168       12       12       36       36  
Customer relationships
    1,302       16       285       21       20       62       61  
Total Neat Solutions Acquisition
    2,468       14 *     690       49       49       148       148  
                                                         
Bibsters® Acquistion on May 27, 2010:
                                                       
Trademarks
    629       15       108       11       10       31       31  
Patents
    553       10       143       14       14       42       42  
Customer relationships
    328       14       61       6       6       18       18  
Total Bibsters® Acquistion
    1,510       13 *     312       31       30       91       91  
Internally developed intangible assets
    742       20       37       10       (2 )     23       2  
Total other intangible assets
  $ 12,718             $ 6,871     $ 193     $ 222     $ 574     $ 839  

 
*
Weighted-Average

Classification within the accompanying consolidated statements of income:
                                 
Cost of products sold
                          $ 15     $ 58     $ 47     $ 333  
Marketing and administrative expenses
            178       164       527       506  
Total amortization expense
          $ 193     $ 222     $ 574     $ 839