Jamba Juice 2007 Annual Report Download - page 95
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Table of Contents
Of these charges, $59,000, $856,000, $8,000, and $1,000 were noncash. In the year of closure, revenue for the stores that have closed was $146,000,
$892,000, $543,000, and $184,000 and net operating losses, which include the losses on store closure, were $3,000, $1,898,000, $71,000, and $113,000 in
the 22 Week Period and fiscal 2006, 2005, and 2004, respectively.
The following is a reconciliation of the store closure accrual (in thousands):
Balance as of June 30, 2005 $—
Provision for estimated net future cash flows of closed stores and buyout costs 543
Balance as of June 30, 2006 543
Payments on liability (9)
Balance as of November 28, 2006 $534
Loss on Disposal of Other Assets—During the 22 Week Period and fiscal 2006, 2005, and 2004, Jamba Juice Company wrote off the net book value
of certain assets that were abandoned due to store remodels or upgrades of equipment.
—net as of November 28, 2006, June 30, 2006 and 2005, consisted of the following (in thousands):
Deposits $704 $578 $ 631
Investment in JJC Florida, LLC 1,645 1,675 1,839
Investment in JJC Hawaii, LLC 372 379 279
Other 29 43 34
Total $2,750 $2,675 $ 2,783
Jamba Juice Company accounts for its investments in JJC Florida, LLC and JJC Hawaii, LLC under the equity method. Jamba Juice Company owned
35.2% and 5.0% of JJC Florida, LLC and JJC Hawaii, LLC, respectively as of November 28, 2006.
During fiscal year 2004, Jamba Juice Company invested an additional $2 million in JJC Florida, LLC as part of an amendment to its original Franchise
Agreement and License Agreement. Under the amendment, profits and losses are to be allocated to the members in proportion to their cash contributions until
the profits for the investment exceed the cumulative losses previously realized. Thereafter, profits shall be allocated to the members in proportion to their
recalculated interests. In addition, the recalculated interest for the investment is based on the contributions of the members, except that Jamba Juice Company
shall receive a 25% premium for its additional contribution.
The amendment also included the ability of JJC Florida, LLC to defer the marketing, royalty, and front-end fees due to Jamba Juice Company. The
deferral period ends the earlier of June 30, 2008 or when JJC Florida, LLC becomes cash flow positive for four consecutive quarters. JJC Florida, LLC did not
meet this requirement as of November 28, 2006. Jamba Juice Company has deferred $1.6 million, $1.4 million, and $0.7 million of fees
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