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PANERA BREAD COMPANY
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)
59
7. Property and Equipment, net
Major classes of property and equipment consisted of the following (in thousands):
December 29,
2015
December 30,
2014
Leasehold improvements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 683,296 $ 693,503
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 338,500 340,854
Computer hardware and software. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 192,521 137,663
Furniture and fixtures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159,653 167,383
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97,416 99,255
Smallwares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,056 29,841
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,604 2,060
1,502,046 1,470,559
Less: accumulated depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (725,798)(683,265)
Property and equipment, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 776,248 $ 787,294
The Company recorded depreciation expense related to these assets of $126.7 million, $115.4 million, and $97.2 million during
fiscal 2015, fiscal 2014, and fiscal 2013, respectively.
8. Goodwill
The following is a reconciliation of the beginning and ending balances of the Company’s goodwill by reportable segment at
December 29, 2015 and December 30, 2014 (in thousands):
Company Bakery-
Cafe Operations
Franchise
Operations
Fresh Dough and Other
Product Operations Total
Balance as of December 31, 2013. . . . . . . . . . . $ 119,384 $ 1,934 $ 1,695 $ 123,013
Impairment charge . . . . . . . . . . . . . . . . . . . . . . (2,057)— —
(2,057)
Currency translation . . . . . . . . . . . . . . . . . . . . . (178)— —
(178)
Balance as of December 30, 2014. . . . . . . . . . . $ 117,149 $ 1,934 $ 1,695 $ 120,778
Acquisition of Tatte. . . . . . . . . . . . . . . . . . . . . . 2,512 — — 2,512
Goodwill classified as held for sale . . . . . . . . . (1,499)— —
(1,499)
Balance as of December 29, 2015. . . . . . . . . . . $ 118,162 $ 1,934 $ 1,695 $ 121,791
The Company did not record a goodwill impairment charge in either fiscal 2015 or fiscal 2013. The Company recorded a $2.1
million full impairment charge of goodwill for the Canadian bakery-cafe operations reporting unit during fiscal 2014.
9. Other Intangible Assets
Other intangible assets consisted of the following (in thousands):
December 29, 2015 December 30, 2014
Gross
Carrying
Value
Accumulated
Amortization
Net
Carrying
Value
Gross
Carrying
Value
Accumulated
Amortization
Net
Carrying
Value
Trademark . . . . . . . . . . . . . . . . . . $ 7,080 $ (2,283) $ 4,797 $ 5,610 $ (2,017) $ 3,593
Re-acquired territory rights . . . . . 97,865 (40,432) 57,433 97,865 (32,369) 65,496
Favorable leases . . . . . . . . . . . . . . 5,012 (3,365) 1,647 4,825 (2,974) 1,851
Total other intangible assets. . . . . $ 109,957 $ (46,080) $ 63,877 $ 108,300 $ (37,360) $ 70,940
Amortization expense on these intangible assets for fiscal 2015, fiscal 2014, and fiscal 2013, was approximately $8.7 million,
$8.7 million, and $9.3 million, respectively. Future amortization expense on these intangible assets as of December 29, 2015 is