Property and Equipment, Net

6 Months Ended

Jul. 30, 2016

Property, Plant and Equipment [Abstract]

Property and equipment, net consisted of:



(in thousands)	July 30, 2016			January 30, 2016
Property and equipment, at cost	$	2,825,737		$	2,792,437
Less: Accumulated depreciation and amortization	(1,975,623		)	(1,898,259		)
Property and equipment, net	$	850,114		$	894,178

Long-lived assets, primarily comprised of leasehold improvements, furniture, fixtures and equipment, are tested for recoverability whenever events or changes in circumstances indicate that the carrying amount of the long-lived assets might not be recoverable. These include, but are not limited to, material declines in operational performance, a history of losses, an expectation of future losses, other than temporary adverse market conditions and store closure or relocation decisions. On at least a quarterly basis, the Company reviews for indicators of impairment at the individual store level, the lowest level for which cash flows are identifiable.

Stores that display an indicator of impairment are subjected to an impairment assessment. The Company’s impairment assessment requires management to make assumptions and judgments related, but not limited, to management's expectations for future operations and projected cash flows. The key assumptions used in the Company's undiscounted future cash flow models include sales, gross margin and, to a lesser extent, operating expenses.

An impairment loss would be recognized when these undiscounted future cash flows are less than carrying amount of the asset group. In the circumstance of impairment, the loss would be measured as the excess of the carrying amount of the asset group over its fair value. The key assumptions used in estimating the fair value of impaired assets may include projected cash flows and discount rate.

In the second quarter of Fiscal 2016, the Company incurred non-cash asset impairment charges of $6.4 million as it was determined that the carrying value of certain store assets would not be recoverable and exceeded fair value. These asset impairment charges are related to the Company's abercrombie kids flagship store in London.

In the year-to-date period of Fiscal 2015, the Company incurred non-cash asset impairment charges of $6.1 million related to a decision to remove certain store fixtures in connection with changes to the Abercrombie and Hollister store experiences, and a fair value adjustment related to the Company-owned aircraft which was sold in the second quarter of Fiscal 2015.

The Company had $38.1 million and $37.3 million of construction project assets in property and equipment, net at July 30, 2016 and January 30, 2016, respectively, related to the construction of buildings in certain lease arrangements where the Company is deemed to be the owner of the construction project.