El Pollo Loco 2015 Annual Report Download - page 82

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Table of Contents
EL POLLO LOCO HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
Reclassifications
Certain reclassifications were made to the prior year consolidated financial statements to conform to current year presentation. These revisions
increased working capital by $0.8 million at December 25, 2013 but did not impact net loss, earnings per share, stockholders’ equity or cash
flows for 2013.
3. PROPERTY AND EQUIPMENT
The costs and related accumulated depreciation and amortization of major classes of property are as follows (in thousands):
Depreciation expense was $11.5 million, $10.2 million and $9.5 million for the years ended December 31, 2014, December 25, 2013, and
December 26, 2012, respectively. Gross value of assets under capital leases for buildings and improvements was $1,800,800 and $1,884,000 at
December 31, 2014 and December 25, 2013, respectively. Accumulated depreciation for assets under capital leases was $1,673,000 and
$1,703,000 for the years ended December 31, 2014 and December 25, 2013, respectively. For the year ended December 31, 2014, capital
expenditures related to restaurant remodeling and new restaurant expenditures totaled $23.9 million, which consisted of $7.6 million and $16.3
million, respectively. For the year ended December 25, 2013, capital expenditures related to restaurant remodeling and new restaurant
expenditures totaled $11.3 million, which consisted of $9 million and $2.3 million, respectively.
4. GOODWILL AND OTHER INTANGIBLE ASSETS AND LIABILITIES
Changes in goodwill consist of the following (in thousands):
On September 24, 2014, we completed an agreement to sell six company-operated restaurants in the greater San Antonio area to AA Pollo, Inc.,
resulting in cash proceeds of $5.4 million. Goodwill was decremented by $650,000, based on a calculation of the fair value of the restaurants
sold relative to the fair value of the portion of the reporting unit retained. We recognized a net gain of $2.7 million on this transaction, which is
recorded as a gain on disposition of restaurants in the accompanying statement of operations. These six restaurants are now franchised. There
have been no impairment losses to goodwill life to date.
78
December 31, 2014
December 25, 2013
Land
$
12,323
$
13,186
Buildings and improvements
92,834
78,181
Other property and equipment
49,890
46,079
Construction in progress
2,353
815
157,400
138,261
Less: accumulated depreciation and amortization
(75,310
)
(69,620
)
$
82,090
$
68,641
December 31, 2014
December 25, 2013
Balance at beginning of year
$
249,324
$
249,924
Restaurant disposition
(650
)
(600
)
Balance at end of year
$
248,674
$
249,324