IHOP 2009 Annual Report Download - page 117
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DineEquity, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
7. Other Intangible Assets
The Company did not have any intangible assets prior to the November 29, 2007 acquisition of
Applebee’s. As of December 31, 2009, intangible assets are as follows:
Not Subject to Amortization Subject to Amortization
Liquor Franchising Recipes and
Tradename Licenses Other Rights Menus Leaseholds Total
Balance, December 31, 2006 ....... $ — $ — $— $ — $ — $ — $ —
Acquisition of business ........... 790.0 6.4 — 200.5 15.7 — 1,012.6
Amortization expense ............ — — — (1.0) (0.1) — (1.1)
Balance, December 31, 2007 ....... 790.0 6.4 — 199.5 15.6 — 1,011.5
Additions ..................... — — — — — 7.3 7.3
Purchase price adjustments ........ — (1.7) — — — 0.4 (1.3)
Amortization expense ............ — — — (10.0) (2.1) (1.7) (13.8)
Impairment ................... (44.1) — — — — — (44.1)
Refranchising .................. — (1.8) — — — (1.8) (3.6)
Balance, December 31, 2008 ....... 745.9 2.9 — 189.5 13.5 4.2 956.0
Amortization expense ............ — — — (10.0) (2.3) (1.1) (13.4)
Impairment ................... (93.5) — — — — — (93.5)
Other ........................ — — 0.2 — — 0.3 0.5
Balance, December 31, 2009 ....... $652.4 $ 2.9 $0.2 $179.5 $11.2 $ 3.4 $ 849.6
See Note 17, Impairment and Closure Charges, regarding the impairment of the tradename
recognized in 2009 and 2008.
Annual amortization expense for next five fiscal years is estimated to be approximately
$12.9 million annually. The weighted average life of the intangible assets subject to amortization is 18.6
and 18.7 years at December 31, 2009 and 2008, respectively.
Gross and net carrying amounts of intangible assets subject to amortization at December 31, 2009
and 2008 are as follows:
December 31, 2009 December 31, 2008
Accumulated Accumulated
Gross Amortization Net Gross Amortization Net
(In millions)
Franchising rights ................ $200.5 $(21.0) $179.5 $200.5 $(11.0) $189.5
Recipes and menus ............... 15.7 (4.5) 11.2 15.7 (2.2) 13.5
Leaseholds/other ................ 6.2 (2.8) 3.4 5.9 (1.7) 4.2
Total ........................... $222.4 $(28.3) $194.1 $222.1 $(14.9) $207.2
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