Albertsons 2003 Annual Report Download - page 55

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SUPERVALU INC. and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The number of actual employees terminated under the fiscal 2000 restructure plan was adjusted to a lower
number than originally expected primarily due to higher than anticipated voluntary attrition. There was no
activity in fiscal 2003. Details of the fiscal 2000 restructure activity as it relates to employees are as follows:
Original
Estimate
Employees
Terminated
in Prior Years
Adjustments
in Prior Years
Balance
February 23,
2002
Employees 2,517 (1,693) (824) —
RESERVES FOR CLOSED PROPERTIES AND ASSET IMPAIRMENT
The company maintains reserves for estimated losses on retail stores, distribution warehouses and other
properties that are no longer being utilized in current operations. The reserves for closed properties include
management’s estimates for lease subsidies, lease terminations, future payments on exited real estate and
severance. Details of the activity in the closed property reserves for fiscal 2003, 2002 and 2001 are as follows:
(In thousands)
Balance
February 22, 2003
Balance
February 23, 2002
Balance
February 24, 2001
Beginning balance $ 74,996 $68,067 $ 40,652
Additions 3,169 12,399 39,565
Usage (28,292) (5,470) (12,150)
Ending balance $ 49,873 $74,996 $ 68,067
The company recognized impairment charges of $15.6 million for fiscal 2003 on the write-down of
property, plant and equipment for closed properties. Of the $15.6 million impairment charge, $6.9 million related
to food distribution and $8.7 million related to retail food. In fiscal 2002, the company recognized impairment
charges of $10.0 million of which $1.2 million related to food distribution and $8.8 million related to retail food.
In fiscal 2001, the company recognized impairment charges of $15.8 million of which $0.1 million related to
food distribution and $15.7 million related to retail food. Impairment charges, a component of selling and
administrative expenses in the Consolidated Statements of Earnings, reflect the difference between the carrying
value of the assets and the estimated fair values, which were based on the estimated market values for similar
assets.
NOTES RECEIVABLE
Notes receivable arise from financing activities with affiliated retail food customers. Loans to affiliated
retailers, as well as trade accounts receivable, are primarily collateralized by the retailers’ inventory, equipment
and fixtures. The notes range in length from 1 to 16 years with an average term of 6 years, and may be non-
interest bearing or bear interest at rates ranging from 5 to 11 percent.
Included in current receivables are notes receivable due within one year, net of allowance for losses, of
$30.3 million and $23.9 million at February 22, 2003 and February 23, 2002, respectively.
GOODWILL AND OTHER INTANGIBLE ASSETS
At February 22, 2003, the company had approximately $1.6 billion of goodwill on its Consolidated Balance
Sheets of which $0.9 billion was related to retail food and $0.7 billion was related to food distribution.
F-20