What were the restaurant impairments, closure costs, and asset disposals for Noodles & Company in 2022 (in thousands)?
Noodles_Company Franchise · 2025 FDDAnswer from 2025 FDD Document
he fair value measurement and unobservable (i.e., supported by little or no market activity).
6. Restaurant Impairments, Closure Costs and Asset Disposals
The following table presents restaurant impairments, closure costs and asset disposals for fiscal years 2024, 2023 and 2022 (in thousands):
| 2024 | 2023 | 2022 |
|---|
Source: Item 22 — CONTRACTS (FDD pages 98–99)
What This Means (2025 FDD)
According to Noodles & Company's 2025 Franchise Disclosure Document, the combined restaurant impairments, closure costs, and asset disposals totaled $6,164,000 in 2022. This figure represents the sum of three components: restaurant impairments, closure costs, and losses on disposal of assets. Restaurant impairments specifically amounted to $1,362,000, reflecting the reduction in value of restaurant assets. Closure costs, which include expenses related to restaurants that closed in previous years and costs associated with closing five restaurants in 2022, totaled $1,285,000. The loss on disposal of assets was $3,517,000.
These expenses can significantly impact Noodles & Company's profitability and financial health. Restaurant impairments typically arise when the carrying value of assets exceeds their fair market value, indicating underperformance or operational challenges at specific locations. Closure costs reflect the ongoing financial obligations associated with closed restaurants, such as lease payments or settlement costs. Losses on disposal of assets can stem from the sale of underperforming assets or the write-off of obsolete equipment. These costs are included in restaurant impairments, closure costs and asset disposals in the Consolidated Statement of Operations.
For a prospective Noodles & Company franchisee, understanding these costs is crucial. While franchisees may not directly bear these expenses for company-owned stores, they reflect the overall financial performance and strategic decisions of the franchisor. High impairment and closure costs could indicate operational inefficiencies or market challenges that might indirectly affect franchisees. Additionally, these figures provide insight into the company's asset management practices and its ability to adapt to changing market conditions. Franchisees should consider these trends when evaluating the long-term viability and stability of the Noodles & Company franchise system.