IHOP 2009 Annual Report Download - page 137
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DineEquity, Inc. and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
16. Other Comprehensive Income (Loss)
The components of comprehensive income (loss), net of taxes, are as follows:
Year Ended December 31,
2009 2008 2007
(in millions)
Net income (loss) .............................. $31.4 $(154.4) $ (0.5)
Other comprehensive income (net of tax):
Interest rate swap ............................ 8.5 7.7 (36.6)
Temporary decline in available-for-sale securities ...... 0.1 (0.4) —
Total comprehensive income (loss) .................. $40.0 $(147.1) $(37.1)
The amount of income tax benefit allocated to the interest rate swap was $5.6 million, $4.9 million
and $24.1 million for the years ended December 31, 2009, 2008 and 2007, respectively. The amount of
income tax benefit allocated to the temporary decline in available-for-sale securities was $0.1 million
for the year ended December 31, 2008.
The loss related to an interest rate swap designated as a cash flow hedge is being reclassified into
earnings as interest expense over the expected life of the related debt, estimated to be approximately
five years. Approximately $9.2 million, net of tax, is expected to be reclassified into earnings over the
next 12 months.
The accumulated comprehensive loss of $20.8 million (net of tax) as of December 31, 2009 is
comprised of $20.5 million related to a terminated interest rate swap and $0.3 million related to a
temporary decline in available-for-sale securities. The accumulated comprehensive loss of $29.4 million
(net of tax) as of December 31, 2008 is comprised of $29.0 million related to a terminated interest rate
swap and $0.4 million related to a temporary decline in available-for-sale securities.
17. Impairments and Closure Charges
Impairment and closure charges for the years ended December 31, 2009, 2008 and 2007 were as
follows:
Year Ended December 31,
2009 2008 2007
(In millions)
Goodwill impairment ........................... $ — $124.8 $ —
Tradename impairment .......................... 93.5 44.1 —
Long-lived tangible asset impairment ................ 10.4 71.4 3.3
Closure charges ............................... 1.2 0.3 1.1
Total impairment and closure charges ................. $105.1 $240.6 $4.4
In accordance with U.S. GAAP, indefinite-lived intangible assets must be evaluated for impairment,
at a minimum, on an annual basis, and more frequently if the Company believes indicators of
impairment exist. Such indicators include, but are not limited to, events or circumstances such as a
significant adverse change in the business climate, unanticipated competition, a loss of key personnel,
adverse legal or regulatory developments, or a significant decline in the market price of the Company’s
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