Restaurant Impairments, Closure Costs and Asset Disposals

3 Months Ended

Apr. 04, 2023

Discontinued Operations and Disposal Groups [Abstract]

Restaurant Impairments, Closure Costs and Asset Disposals

The following table presents restaurant impairments, closure costs and asset disposals (in thousands):


	Fiscal Quarter Ended
	April 4, 2023		March 29, 2022
Restaurant impairments (1)	$	86	$	106
Closure costs (1)	558		389
Loss on disposal of assets and other	925		894
	$	1,569	$	1,389

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(1)Restaurant impairments and closure costs in all periods presented above include amounts related to restaurants previously impaired or closed.

There were no restaurant impairments in both first quarters of 2023 and 2022. Impairment is based on management’s current assessment of the expected future cash flows of a restaurant based on recent results and other specific market factors. Impairment expense is a Level 3 fair value measure and is determined by comparing the carrying value of restaurant assets to the estimated fair value of the restaurant assets at resale value and the right-of-use asset based on a discounted cash flow analysis utilizing market lease rates.

Closure costs in the first quarter of 2023 consisted of costs related to two restaurants closed in the first quarter of 2023 as well as costs related to ongoing expenses from restaurant closures in prior years. Closure costs also include two early lease termination settlements, one of which closed during the first quarter of 2023, and one of which closed during the second quarter of 2023.

Loss on disposal of assets and other during the first quarters of 2023 and 2022 includes asset disposals in the normal course of business and lease related costs and expenses in connection with the divestiture of company-owned restaurants in 2022 and 2020.