Wendy's 2011 Annual Report Download - page 95

Download and view the complete annual report

Please find page 95 of the 2011 Wendy's annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 168

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168

THE WENDY’S COMPANY AND SUBSIDIARIES
WENDY’S RESTAURANTS, LLC AND SUBSIDIARIES
COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—CONTINUED
(In Thousands Except Per Share Amounts)
Investment in Joint Venture in Japan
During the second quarter of 2011, Wendy’s entered into the Japan JV. Wendy’s 49% share of the joint
venture is accounted for using the equity method of accounting. The Japan JV opened its first restaurant in December
2011. As of January 1, 2012, the carrying value of our investment in the Japan JV was $77, which is included in
“Investments.” For the year ended January 1, 2012, we recognized a loss of $1,106 which is included in “Other
operating expense, net.”
Indirect Investment in Arby’s
In connection with the sale of Arby’s, Wendy’s Restaurants obtained an 18.5% equity interest in Buyer Parent
(through which Wendy’s Restaurants indirectly retained an 18.5% interest in Arby’s) with a fair value of $19,000. See
Note 2 for more information on the sale of Arby’s. We account for our interest in Arby’s as a cost method investment.
(The Wendy’s Company)
Investment in Jurlique International Pty Ltd.
Jurl Holdings, LLC (“Jurl”), a 99.7% owned subsidiary, holds our approximately 11% cost-method investment
in Jurlique International Pty Ltd. (“Jurlique”), an Australian manufacturer of skin care products. Prior to 2009, we
had determined that all of our then remaining $8,500 investment in Jurlique was impaired. In December 2011,
Jurlique agreed to be purchased by a third party. In order to protect our expected proceeds of $28,500 Australian
dollars from a decrease in the value of the Australian dollar through the expected 2012 closing date, we entered into a
foreign currency related derivative transaction for an equivalent notional amount in U.S. dollars. The fair value of this
derivative was not significant as of January 1, 2012.
On February 2, 2012, the sale of Jurlique was completed and we expect to record a related gain of
approximately $30,000 in the first quarter of 2012. In connection with the sale, the settlement of the derivative
transaction described above resulted in a loss of $2,900.
Prior to 2009, we had provided our Chairman, who was also our then Chief Executive Officer, and our Vice
Chairman, who was our then President and Chief Operating Officer (the “Former Executives”), and certain other
former employees, equity and profits interests in Jurl. In connection with the sale of our investment in Jurlique, the
Company will distribute, based on the related agreement, approximately $3,649 to Jurl’s minority shareholders,
including approximately $2,807 to the Former Executives.
Investment Activity
(The Wendy’s Company)
Proceeds from sales of current and non-current available-for-sale securities, and gross realized gains and gross
realized losses on those transactions, which are included in “Investment income (expense), net” are as follows:
2010 2009
Proceeds from sales ................................................. $288 $32,243
Gross realized gains ................................................. $125 $ 3,035
Gross realized losses ................................................. — (618)
$125 $ 2,417
91