Annual and transition report of foreign private issuers pursuant to Section 13 or 15(d)

Intangible assets, net

v3.23.1
Intangible assets, net
 12 Months Ended
Dec. 31, 2022
Intangible assets, net [Abstract]  
Intangible assets, net
13. Intangible assets, net

 

Acquisition cost:   As
January 1,
2020		     Additions     Disposals     As of
January 3,
2021		  
Brand   Ps. 253,000      
-
      
-
       253,000  
Customer relationships     64,000      
-
      
-
       64,000  
Software     21,651       24,333      
-
       45,984  
Brands and logo rights     7,608       276       (2,491 )     5,393  
    Ps. 346,259       24,609       (2,491 )     368,377  

 

Accumulated amortization:   As of
January 1,
2020		     Amortization
expense		     Disposals     As of
January 3,
2021		  
Customer relationships   Ps. (30,933 )     (6,400 )    
        -
       (37,333 )
Software     (421 )     (6,675 )    
-
       (7,096 )
Brands and logo rights     (3,940 )     (647 )    
-
       (4,587 )
    Ps. (35,294 )     (13,722 )    
-
       (49,016 )

 

Acquisition cost:   As of
January 3,
2021		     Additions     Disposals     As of
December 31,
2021		  
Brand   Ps. 253,000       -            -       253,000  
Customer relationships     64,000       -       -       64,000  
Software     45,984       65,356       -       111,340  
Brands and logo rights     5,393       70       -       5,463  
    Ps. 368,377       65,426       -       433,803  

 

Accumulated amortization:   As of
January 3,
2021		     Amortization
expense		     Disposals     As of
December 31,
2021		  
Customer relationships   Ps. (37,333 )     (6,400 )    
       -
       (43,733 )
Software     (7,096 )     (8,377 )    
-
       (15,473 )
Brands and logo rights     (4,587 )     (250 )    
-
       (4,837 )
    Ps. (49,016 )     (15,027 )    
-
       (64,043 )

 

Acquisition cost:   As of
December 31,
2021		     Subsidiaries’
Acquisitions		     Additions     Disposals     Foreign
currency
translation		    

As of
December 31,
2022

  
Brand   Ps. 253,000       840,616       9,493          -       (1,003 )     1,102,106  
Customer relationships     64,000       553,808       -       -       -       617,808  
Software     111,340       -       41,443       -       -       152,783  
Brands and logo rights     5,463       -       109       -       -       5,572  
    Ps. 433,803       1,394,424       51,045       -       (1,003 )     1,878,269  

 

Accumulated amortization:   As of
December 31,
2021		     Amortization
expense		     Disposals     Foreign
currency
translation		     As of
December 31,
2022		  
Customer relationships   Ps. (43,733 )     (40,412 )    
    -
      
    -
       (84,145 )
Software     (15,473 )     (29,686 )    
-
      
-
       (45,159 )
Brands and logo rights     (4,837 )     (246 )    
-
      
-
       (5,083 )
    Ps. (64,043 )     (70,344 )    
-
      
-
       (134,387 )

 

Brands:

 

● The “Betterware” brand is an intangible asset with an indefinite useful life and a carrying amount of Ps.253,000, which is presented in the consolidated statements of financial position. This brand was transmitted to the Group through a merger carried out on July 28, 2017 with Strevo Holding, S.A. de C.V. (a related party under common control). Strevo obtained such brand when acquiring the majority of the Betterware’s shares in March 2015.

 

●

The “JAFRA” brands are intangible assets with an indefinite useful life and a carrying amount of Ps.849,106, which is presented in the consolidated statements of financial position. Since the business combination with the Group on the date of on April 7, 2022, the JAFRA brands were valued at their fair value.

 

Customer relationships:

 

● The intangible for the relationship with customers of Betterware was transferred to the Group through a merger with Strevo carried out on July 28, 2017, this intangible asset has a useful life of ten years and are amortized using the straight-line method.

 

●

The intangible for the relationship with customers of JAFRA arose from the valuation of assets acquired and liabilities assumed by business combination dated April 7, 2022 this intangible asset has a useful life of twelve years and are amortized using the straight-line method. The calculation comprised the revenues attributable of Jafra Mexico and the total number of consultants as of the valuation date. In addition, future revenues, growth rate and desertion were projected.

The customers relationships balances of the Group are described below:

 

    As of
December 31,
2022		     As of
December 31,
2021		     As of
January 3,
2021		  
Betterware   Ps. 13,867       20,267       26,667  
JAFRA Mexico     519,796       -       -  
Total of customers relationships   Ps. 533,663       20,267       26,667  

 

Brands and logo rights

 

● Betterware has incurred expenses related to the registration trademarks and logos rights with intellectual property authorities, which have a defined life, are amortized linearly over their estimated useful life, which ranges from 10 to 30 years. As of December 31, 2022, 2021 and January 3, 2021, intangible assets for brands and logo rights are presented in the consolidated statement of financial position for a total of Ps.489, Ps.626 and Ps.806, respectively.

 

At each reporting date, the Group reviews the carrying amounts of its non-financial assets to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. As of December 31, 2022, 2021 and January 3, 2021, the Group have been not identified indications of impairment.

 

In relation to impairment of intangible assets with indefinite useful life (brand), the Group estimates the recoverable amount of the intangible asset which is based on fair value less costs of disposal, estimated using discounted cash flows. The fair value measurement was categorized as a Level 3 fair value based on the inputs in the valuation technique used (see note 12).