Whole Foods 2010 Annual Report Download - page 50

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(7) Property and Equipment
Balances of major classes of property and equipment are as follows (in thousands):
2010 2009
Land $ 48,928 $ 48,928
Buildings and leasehold improvements 1,863,259 1,687,103
Capitalized real estate leases 24,874 24,874
Fixtures and equipment 1,240,303 1,187,195
Construction in progress and equipment not yet in service 120,845 130,068
3,298,209 3,078,168
Less accumulated depreciation and amortization (1,412,079) (1,180,315)
$ 1,886,130 $ 1,897,853
Depreciation and amortization expense related to property and equipment totaled approximately $265.1 million, $255.3
million and $233.5 million for fiscal years 2010, 2009 and 2008, respectively. Property and equipment included accumulated
accelerated depreciation and other asset impairments totaling approximately $7.8 million and $9.6 million at September 26,
2010, and September 27, 2009, respectively. Property and equipment includes approximately $3.8 million, $5.2 million and
$6.0 million of interest capitalized during fiscal years 2010, 2009 and 2008, respectively. Development costs of new
locations totaled approximately $171.4 million, $248.0 million and $357.5 million in fiscal years 2010, 2009 and 2008,
respectively. Construction accruals related to development sites, remodels, and expansions were included in the “Other
current liabilities” line item on the Consolidated Balance Sheets and totaled approximately $29.9 million and $35.2 million at
September 26, 2010, and September 27, 2009, respectively. Additionally, the Company also held approximately $1.5 million
and $4.8 million, net of accumulated depreciation, related to certain land and buildings held for sale as of September 26,
2010 and September 27, 2009, respectively, in the “Prepaid expenses and other current assets” line item on the Consolidated
Balance Sheets. During fiscal year 2010, the Company recorded a gain of approximately $3.2 million related to the sale of a
non-operating property, which was included in the “Relocation, store closure and lease termination costs” line item on the
Consolidated Statements of Operations. Subsequent to year-end, the Company sold certain fixtures and equipment at
carrying value, totaling approximately $1.5 million.
(8) Goodwill and Other Intangible Assets
There were no impairments of goodwill during fiscal years 2010, 2009 or 2008. The Company recorded goodwill
adjustments of approximately $2.6 million, related to certain restructuring reserves, and approximately $1.3 million related
primarily to certain restructuring reserves and certain tax liabilities during fiscal years 2010 and 2009, respectively.
Additionally, during fiscal year 2010, the Company recorded goodwill totaling approximately $9.5 million in connection
with the Greenlife acquisition.
The components of intangible assets were as follows (in thousands):
2010
2009
Gross carrying Accumulated Gross carrying Accumulated
amount amortization amount amortization
Indefinite-lived contract-based $ 1,643 $ - $ 1,566 $ -
Definite-lived contract-based 96,821 (30,706) 96,515 (25,105)
Definite-lived marketing-related and other 1,574 (268) 225 (166)
$ 100,038 $ (30,974) $ 98,306 $ (25,271)
We acquired definite-lived intangible assets totaling approximately $1.9 million, consisting primarily of license agreements
and acquired leasehold rights, and approximately $1.6 million, consisting primarily of acquired leasehold rights, during fiscal
years 2010 and 2009, respectively. Amortization associated with intangible assets totaled approximately $6.0 million, $7.9
million and $12.9 million during fiscal years 2010, 2009 and 2008, respectively. Future amortization associated with the net
carrying amount of intangible assets is estimated to be approximately as follows (in thousands):
Fiscal year 2011 $ 6,076
Fiscal year 2012 6,025
Fiscal year 2013 5,138
Fiscal year 2014 5,005
Fiscal year 2015 4,692
Future fiscal years 40,485
$ 67,421