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Impairment of Long-Lived Assets | 9 Months Ended
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Sep. 30, 2012
Goodwill and Other Intangible Assets [Abstract] |
Impairment of Long-Lived Assets |
13. | Impairment of Long-Lived Assets
The Company reviews long-lived assets for impairment indicators on a quarterly basis or whenever events or changes in circumstances indicate the carrying amount of the assets may not be fully recoverable. The Company considers actual theatre level cash flows, future years budgeted theatre level cash flows, theatre property and equipment carrying values, amortizing intangible asset carrying values, the age of a recently built theatre, competitive theatres in the marketplace, the impact of recent ticket price changes, available lease renewal options and other factors considered relevant in its assessment of impairment of individual theatre assets. Long-lived assets are evaluated for impairment on an individual theatre basis, which the Company believes is the lowest applicable level for which there are identifiable cash flows. The impairment evaluation is based on the estimated undiscounted cash flows from continuing use through the remainder of the theatre’s useful life. The remainder of the useful life correlates with the available remaining lease period, which includes the probability of renewal periods for leased properties and a period of approximately twenty years for fee owned properties. If the estimated undiscounted cash flows are not sufficient to recover a long-lived asset’s carrying value, the Company then compares the carrying value of the asset group (theatre) with its estimated fair value. When estimated fair value is determined to be lower than the carrying value of the asset group (theatre), the asset group (theatre) is written down to its estimated fair value. Significant judgment is involved in estimating cash flows and fair value. Management’s estimates, which fall under Level 3 of the U.S. GAAP fair value hierarchy as defined by FASB ASC Topic 820-10-35, are based on historical and projected operating performance, recent market transactions and current industry trading multiples. Fair value is determined based on a multiple of cash flows, which was six and a half times for the evaluations performed during the nine months ended September 30, 2012 and 2011. As of September 30, 2012, the estimated aggregate fair value of the long-lived assets impaired during the nine months ended September 30, 2012 was $4,760. The long-lived asset impairment charges recorded during each of the periods presented are specific to theatres that were directly and individually impacted by increased competition, adverse changes in market demographics or adverse changes in the development or the conditions of the areas surrounding the theatre.
|  | Three Months Ended September 30, |  |  | Nine Months Ended September 30, |
|  | 2012 |  |  | 2011 |  |  | 2012 |  |  | 2011 |
United States theatre properties |  | $ | 884 |  |  | $ | 303 |  |  | $ | 1,261 |  |  | $ | 1,367 |
International theatre properties |  |  | 92 |  |  |  | 689 |  |  |  | 211 |  |  |  | 2,234 |
Subtotal |  | $ | 976 |  |  | $ | 992 |  |  | $ | 1,472 |  |  | $ | 3,601 |
Intangible assets |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Impairment of long-lived assets |  | $ | 976 |  |  | $ | 992 |  |  | $ | 1,472 |  |  | $ | 3,601 |

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- Definition The entire disclosure for the details of the charge against earnings resulting from the aggregate write down of all assets from their carrying value to their fair value. Disclosure may also include a description of the impaired asset and facts and circumstances leading to the impairment, amount of the impairment loss and where the loss is located in the income statement, method(s) for determining fair value, and the segment in which the impaired asset is reported. + References No definition available. + Details
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- Details
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