Impairment and Other Charges (Gains), net |
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| Impairment and Other Charges (Gains), net |
4. Impairment and Other Charges (Gains), net
Impairment and other charges consist of the following (in thousands):
Asset Impairment and Restaurant Closure Costs
During fiscal 2024, the Company closed eight locations and is evaluating alternatives for approximately 70 underperforming restaurant locations, including closure upon expiration of the current lease term. The Company recognized non-cash impairment charges of $32.8 million, primarily associated with this review of underperforming locations as well as impairment of quota state liquor licenses at three locations. In addition, the Company recorded $1.2 million in charges associated with the eight store closures in fiscal 2024.
During fiscal 2023, the Company recognized non-cash impairment charges of $9.1 million, primarily related to the impairment of long-lived assets at 19 underperforming locations and quota state liquor licenses at three locations. In addition, the Company recorded $3.1 million in charges associated with five closed locations.
During fiscal 2022, the Company recognized non-cash impairment charges of $38.5 million, primarily related to impairments of long-lived assets at 46 underperforming locations and quota state liquor licenses at six locations. In addition, the Company recorded $0.8 million in costs associated with 16 closed locations during fiscal 2022.
Severance and Executive Transition
During fiscal 2024, 2023, and 2022, the Company incurred severance and executive transition costs primarily related to a reduction in force of Team Members and costs associated with changes in leadership positions.
Gain on Sale of Restaurant Property
During fiscal 2024, the Company sold ten restaurant properties for aggregate net proceeds of $23.3 million in a sale-leaseback transaction that resulted in a gain, net of expenses of $7.4 million. The net proceeds are included within cash flows from investing activities on the Consolidated Statements of Cash Flows for the year ended December 29, 2024.
During fiscal 2023, the Company sold 18 restaurant properties for aggregate net proceeds of $58.8 million in sale-leaseback transactions that resulted in a gain, net of expenses of $29.4 million. In addition, during 2023, the Company sold one restaurant property for net proceeds of $1.5 million which resulted in a gain, net of expenses of $0.1 million. The net proceeds are included within cash flows from investing activities on the Consolidated Statements of Cash Flows for the year ended December 31, 2023.
During fiscal 2022, the Company sold one restaurant property for aggregate net proceeds of $12.4 million in a short-term sale-leaseback transaction that resulted in a gain, net of expenses of $9.2 million. The net proceeds are included within cash flows from investing and financing activities on the Consolidated Statements of Cash Flows for the year ended December 25, 2022.
Litigation Contingencies
In fiscal 2024, 2023, and 2022, the Company recorded reserves associated with litigation contingencies. See Note 12. Commitments and Contingencies, for further discussion.
Asset Disposal and Other Asset disposal and other primarily relates to lease terminations and closures of restaurants and corporate office locations, asset disposals, strategic projects and other non-recurring items.
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