Impairment and Closure Charges

6 Months Ended

Jun. 30, 2011

Impairment and Closure Charges

Impairment and Closure Charges

7. Impairment and Closure Charges

The Company assesses tangible long-lived assets for impairment when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. The following table summarizes the components of impairment and closure charges for the three-month and six-month periods ended June 30, 2011 and 2010:

	Three Months Ended June 30,				Six Months Ended June 30,
	2011		2010		2011		2010
	(In millions)
Impairment and closure charges:
Impairment	$	0.3	$	0.0	$	4.8	$	0.3
Lenexa lease termination	21.2		—		21.2		—
Other closure charges	0.3		1.9		0.8		2.3
Total impairment and closure charges	$	21.8	$	1.9	$	26.8	$	2.6

Impairment and closure charges for the six months ended June 30, 2011 totaled $26.8 million and primarily related to termination of the Company’s sublease of the commercial space currently occupied by Applebee’s Restaurant Support Center in Lenexa, Kansas. The Company recognized approximately $21.2 million for the termination fee and other closing costs in the second quarter of 2011. The Company recognized a $4.5 million impairment charge in the quarter ended March 31, 2011 related to furniture, fixtures and leasehold improvements at the facility whose book value was not realizable as the result of the termination of the sublease.

Impairment and closure charges for the six months ended June 30, 2010 totaled $2.6 million and related to closure charges of $1.7 million recognized in the second quarter of 2010 that related primarily to two company-operated IHOP Cafe restaurants, a non-traditional restaurant format, development of which was ended after initial evaluation, and the closure of a company-operated Applebee’s restaurant in China recognized in the first quarter of 2010.

The following table summarizes changes in the closure liability for the Applebee’s Restaurant Support Center in Lenexa, Kansas:

	(In millions)
Balance December 31, 2010	$	—
Closure cost accrual	21.2
Payments	(0.6		)
Balance June 30, 2011	$	20.6