Red Robin Gourmet Burgers, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Goodwill and Intangible Assets

Goodwill and Intangible Assets

9 Months Ended

Oct. 02, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

The following table presents goodwill as of October 2, 2016 and December 27, 2015 (in thousands):



Balance, December 27, 2015	$	81,957
Acquisition	13,610
Translation adjustment	$	734
Balance, October 2, 2016	$	96,301

The Company had no goodwill impairment losses in the period presented in the table above or any prior periods. During the first quarter of 2016, the Company acquired 13 restaurants from a franchisee. Refer to Note 5, Acquisition of Red Robin Franchised Restaurants, for details of the acquisition.

The following table presents intangible assets as of October 2, 2016 and December 27, 2015 (in thousands):



	October 2, 2016							December 27, 2015
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Intangible assets subject to amortization:
Franchise rights	$	56,154	$	(26,537	)	$	29,617	$	50,878	$	(23,904	)	$	26,974
Favorable leases	13,931		(7,232		)	6,699		12,991		(6,643		)	6,348
Liquor licenses	10,250		(9,840		)	410		10,168		(9,751		)	417
	$	80,335	$	(43,609	)	$	36,726	$	74,037	$	(40,298	)	$	33,739
Indefinite-lived intangible assets:
Liquor licenses and other	$	6,736	$	—		$	6,736	$	5,834	$	—		$	5,834
Intangible assets, net	$	87,071	$	(43,609	)	$	43,462	$	79,871	$	(40,298	)	$	39,573

There was an immaterial impairment to franchise rights during the forty weeks ended October 2, 2016 related to one of the restaurants impaired in the second quarter of 2016. There were no impairments to intangible assets during the forty weeks ended October 4, 2015. The aggregate amortization expense related to intangible assets subject to amortization was $1.3 million and $3.9 million for the twelve and forty weeks ended October 2, 2016.

The estimated aggregate future amortization expense as of October 2, 2016 is as follows (in thousands):



Remainder of 2016	$	1,052
2017	4,511
2018	4,299
2019	4,251
2020	3,726
Thereafter	18,887
	$	36,726

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details