Rite Aid 2014 Annual Report Download - page 78

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RITE AID CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
For the Years Ended March 1, 2014, March 2, 2013 and March 3, 2012
(In thousands, except per share amounts)
3. Lease Termination and Impairment Charges (Continued)
result in lease termination charges for lease exit costs and liquidation of inventory, as well as
impairment of assets at these locations. The following table reflects the closed store and distribution
center charges that relate to new closures, changes in assumptions and interest accretion:
Year Ended
March 1, March 2, March 3,
2014 2013 2012
(52 Weeks) (52 Weeks) (53 Weeks)
Balance—beginning of year ................. $323,757 $367,864 $405,350
Provision for present value of noncancellable
lease payments of closed stores ........... 11,646 14,440 11,832
Changes in assumptions about future sublease
income, terminations and change in interest
rates .............................. (4,343) 9,023 11,305
Interest accretion ....................... 21,250 23,246 26,084
Cash payments, net of sublease income ....... (68,040) (90,816) (86,707)
Balance—end of year ...................... $284,270 $323,757 $367,864
The Company’s revenues and income (loss) before income taxes for fiscal 2014, 2013, and 2012
included results from stores that have been closed or are approved for closure as of March 1, 2014.
The revenue, operating expenses and income (loss) before income taxes of these stores for the periods
are presented as follows:
Year Ended
March 1, March 2, March 3,
2014 2013 2012
Revenues ............................... $ 89,416 $139,082 $258,263
Operating expenses ........................ 100,889 153,187 284,803
Gain from sale of assets .................... (13,074) (19,894) (12,206)
Other (income) expenses ................... (8,268) 622 (7,874)
Income (loss) before income taxes ............. 9,869 5,167 (6,460)
Included in these stores’ income (loss) before
income taxes are:
Depreciation and amortization ............... 607 1,342 3,038
Inventory liquidation charges ................. 621 708 598
The above results are not necessarily indicative of the impact that these closures will have on revenues
and operating results of the Company in the future, as the Company often transfers the business of a
closed store to another Company store, thereby retaining a portion of these revenues and operating
expenses.
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