Jamba Juice 2013 Annual Report Download - page 49

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TABLE OF CONTENTS
resulting from accelerated investment in new and expanded growth initiatives (approximately $2.3 million), the increase in expenses for our
semi-annual performance related incentives (approximately $1.3 million), and increased non-cash share-based compensation (approximately
$0.8 million), partially offset by the decrease in litigation charges (approximately $1.0 million) and the change to 52 weeks in fiscal 2012
compared to 53 weeks in fiscal 2011 (approximately $0.5 million).
Store pre-opening
Fiscal Year 2013 to Fiscal Year 2012
Store pre-opening costs are primarily expenses incurred for training new store personnel, pre-opening marketing and pre-opening rent.
Store pre-opening costs in fiscal 2013 were $0.9 million, an increase of $0.3 million, or 45.7%, compared to $0.6 million for the prior year.
The increase in expense is primarily due to the opening of two new Company Stores in fiscal 2013, 52 new Franchise Stores and 15 new
International Stores during fiscal 2013 as compared to the prior year, when one new Company Store, 39 new Franchise Stores and 19 new
International Stores were opened.
Fiscal Year 2012 to Fiscal Year 2011
Store pre-opening costs in fiscal 2012 were $0.6 million, a decrease of $0.4 million, or 37.4%, compared to $1.0 million for the prior
year. The decrease in expense is primarily due to the opening of one new Company Store in fiscal 2012 and lower per unit costs associated
with the opening of 39 new Franchise Stores and 19 new International Stores in fiscal 2012 as compared to the prior year, when nine new
Company Stores, 22 new Franchise Stores and 18 new International Stores were opened.
Impairment of long-lived assets
Fiscal Year 2013 to Fiscal Year 2012
Long-lived assets are reviewed for impairment when indicators of impairment are present. Expected future cash flows associated with an
asset, in addition to other quantitative and qualitative analyses, including certain assumptions about expected future operating performance
and changes in economic conditions are the key factors in determining undiscounted future cash flows. If the sum of the undiscounted cash
flows is less than the carrying value of the asset, we recognize an impairment loss equal to the amount by which carrying value exceeds the
fair value of the asset. For more information, please refer to the discussion under “Business and Summary of Significant Accounting
Policies — Impairment of Long-Lived Assets” included in Note 1 in the Notes to Consolidated Financial Statements.
Impairment of long-lived assets in fiscal 2013 was $0.7 million, flat compared to fiscal 2012, representing a small number of
underperforming stores.
Fiscal Year 2012 to Fiscal Year 2011
Impairment of long-lived assets in fiscal 2012 was $0.7 million, a decrease of $0.6 million, or 44.9%, compared to $1.3 million in
fiscal 2011. The decrease of impairment charge for long-lived assets was primarily due to fewer underperforming stores that had not been
previously impaired compared to the prior year.
Other operating, net
Fiscal Year 2013 to Fiscal Year 2012
Other operating, net consists primarily of gain or loss on disposals, income from jambacard breakage, store lease termination, and
closure costs, jambacard-related fees, and expenses related to our franchise, consumer packaged goods and JambaGO activities. For fiscal
2013, other operating, net was income of $2.2 million, compared to income of $1.8 million for fiscal 2012. The increase in income of $0.4
million was primarily due to a net gain on disposal of fixed assets (approximately $3.8 million) mainly from activities pursuant to our
refranchising strategy, the gain on our contingent consideration, which is recorded at fair value (approximately $0.7 million) and a decrease
in jambacard-related fees (approximately $0.6 million); partially offset by an increase in direct expense related to consumer packaged goods
and JambaGO activities
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