What is the carrying amount of the Del Taco trademark, classified as an indefinite-lived intangible asset, as of January 19, 2025?
Del_Taco Franchise · 2025 FDDAnswer from 2025 FDD Document
2.6 million at that time. The Company determined that there was no such triggering event for the Jack in the Box reporting unit.
The net carrying amounts of intangible assets other than goodwill with definite lives are as follows (in thousands):
| Gross Amount | Accumulated | Net Amount | Gross Amount | Accumulated | Net Amount | |
|---|---|---|---|---|---|---|
| Amortization | Amortization | |||||
| Definite-lived intangible assets: | ||||||
| Sublease assets | $ 2,671 | $ (694) | $ 1,977 | $ 2,671 | $ (620) | $ 2,051 |
| Franchise contracts | 9,700 | (1,554) | 8,146 | 9,700 | (1,389) | 8,311 |
| Reacquired franchise rights | 464 | (317) | 147 | 464 | (311) | 153 |
| $ 12,835 | $ (2,565 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 58)
What This Means (2025 FDD)
According to Del Taco's 2025 Franchise Disclosure Document, the carrying amount of the Del Taco trademark, which is classified as an indefinite-lived intangible asset, was $283,500,000 as of January 19, 2025. This figure represents the net amount, with no accumulated amortization deducted from the gross amount of $283,500,000.
For a prospective franchisee, this indicates the significant value Del Taco places on its brand and trademarks. Intangible assets like trademarks are crucial for brand recognition and customer loyalty, which are key factors in the success of a franchise system. The fact that the trademark is considered 'indefinite-lived' suggests that Del Taco expects the brand to maintain its value for the foreseeable future.
It's important to note that while the trademark has a substantial carrying amount, this doesn't directly translate into a cash value that a franchisee could realize. Instead, it reflects the accounting value of the trademark on Del Taco's balance sheet. However, a strong and well-maintained trademark can contribute to the overall profitability and long-term viability of a Del Taco franchise.