What were the restaurant impairments, closure costs, and asset disposals for Noodles & Company in 2023 (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 losses on disposal of assets totaled $8,400,000 in 2023. This figure represents the sum of three specific components: restaurant impairments of $2,987,000, closure costs of $1,198,000, and losses on disposal of assets amounting to $4,215,000. These expenses are associated with underperforming or closed restaurants, as well as the disposal of assets.
Restaurant impairments are based on the management's assessment of expected future cash flows from company-owned restaurants, considering recent performance and market factors. These impairments occur when the carrying value of restaurant assets exceeds their estimated fair market value. Closure costs encompass ongoing expenses related to restaurants closed in previous years and costs associated with closing restaurants during the specified year. These costs can be offset by gains from adjustments to liabilities as lease terminations occur and may also include fees from real estate advisors and brokers.
Losses on the disposal of assets include asset disposals in the normal course of business and lease-related costs for which Noodles & Company remains obligated. These losses can be partially offset by gains, such as insurance proceeds from property damage. For a potential franchisee, these figures highlight the financial impact of underperforming locations and the costs associated with closures and asset management. It's important to note that these costs can vary significantly year to year, as seen by the $20,268,000 in 2024 and $6,164,000 in 2022.