Papa Johns 2010 Annual Report Download - page 54

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47
our inactive captive insurance program. The decline in profitability in our online ordering system
business reflected a reduction in the online fee percentage as we began to operate the online
business at a break-even level beginning in 2009. The decline in profitability in our print and
promotions business was due to lower sales in 2009, as compared to 2008, reflecting the
challenging U.S. economic environment.
•
Unallocated Corporate Segment. Unallocated corporate expenses increased $13.6 million as
compared to 2008. The components of the unallocated corporate segment were as follows (in
thousands):
Year Ended
December 27,
2009
Year Ended
December 28,
2008
Increase
(Decrease)
General and administrative (a) 26,893$ 16,372$ 10,521$
Net interest 4,251 4,961 (710)
Depreciation 8,684 7,770 914
Franchise support initiatives (b) 9,556 3,900 5,656
Provisions for uncollectible accounts
and notes receivable (c) 1,172 4,082 (2,910)
Other income (801) (931) 130
Total unallocated corporate expenses
49,755
$
36,154
$
13,601
$
(a)
The increase in unallocated general and administrative costs for the year ended
December 27, 2009, was primarily due to the following factors (in thousands):
Year Ended
December 27,
2009
Year Ended
December 28,
2008 Increase
Severance and other management
transition costs (1) 1,607$ 125$ 1,482$
Short- and long-term incentive
compensation (2) 13,145 6,174 6,971
Litigation settlement 1,065 - 1,065
Sponsorship fees (3) 3,907 3,334 573
Other, net 7,169 6,739 430
Total unallocated general and
administrative expenses
26,893
$
16,372
$
10,521
$
(1) In addition to routine management transition costs, the Company implemented a
reduction-in-force during the third quarter of 2009 in which 35 positions were
eliminated, mostly in corporate support areas. Severance and related costs associated
with the reduction-in-force were approximately $900,000.