Wendy's 2014 Annual Report Download - page 33

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(3) The decline in sales and cost of sales and the related increase in franchise revenues in 2014 and 2013 is primarily
a result of the sale of Wendy’s company-owned restaurants to franchisees under our system optimization
initiative which began in 2013. See Management’s Discussion and Analysis of Financial Condition and Results
of Operations contained in Item 7 herein for further discussion.
(4) Facilities action (income) charges, net includes the impact of (1) Wendy’s system optimization initiative,
(2) Wendy’s G&A realignment plan, (3) the relocation of the Company’s Atlanta restaurant support center to
Ohio, (4) the discontinuation of the breakfast daypart at certain restaurants and (5) the sale of Arby’s. See
Note 2 of the Financial Statements and Supplementary Data contained in Item 8 herein for further discussion.
(5) Impairment of long-lived assets primarily includes impairment charges on (1) restaurant-level assets resulting
from the deterioration in operating performance of certain restaurants, additional charges for capital
improvements in restaurants impaired in prior years which did not subsequently recover and the closure of
company-owned restaurants and (2) company-owned aircraft to reflect at fair value. Additionally, in 2014 we
recorded impairment on long-lived assets as a result of the determination the assets will be leased and/or
subleased to franchisees in connection with the sale of restaurants which were not included in our system
optimization initiative. See Note 15 of the Financial Statements and Supplementary Data contained in Item 8
herein for further discussion.
(6) Impairment of goodwill in 2013 represents impairment of our international franchise restaurants goodwill
reporting unit. See Note 8 of the Financial Statements and Supplementary Data contained in Item 8 herein for
further discussion.
(7) Loss on early extinguishment of debt primarily relates to the refinancing, redemption and repayment of
long-term debt. See Note 10 of the Financial Statements and Supplementary Data contained in Item 8 herein
for further discussion.
(8) Investment income, net includes the effect of dividends received from our investment in Arby’s during 2013 and
2012 and the gain on the sale of our investment in Jurlique during 2012. See Note 16 of the Financial
Statements and Supplementary Data contained in Item 8 herein for further discussion.
(9) (Loss) income from discontinued operations, in all periods presented, relates to the sale of Arby’s and related
post-closing adjustments. See Note 17 of the Financial Statements and Supplementary Data contained in Item 8
herein for further discussion.
(10) Net loss (income) attributable to noncontrolling interests includes the impact of the consolidation of the Japan
JV in 2013 and the sale of our investment in Jurlique in 2012 and is excluded from net income attributable to
The Wendy’s Company. See Note 6 of the Financial Statements and Supplementary Data contained in Item 8
herein for further discussion.
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