Lease Termination and Impairment Charges (Tables)

12 Months Ended

Feb. 29, 2020

Lease Termination and Impairment Charges

Schedule of amounts relating to lease termination and impairment charges

	February 29, 2020			March 2, 2019			March 3, 2018
(in thousands, except number of stores)	Number	Charge		Number	Charge		Number	Charge
Active stores:
Stores previously impaired(1)	274	$	11,449	288	$	17,939	218	$	7,313
New, relocated and remodeled stores(2)	8		11,228	22		10,595	28		13,100
Remaining stores not meeting the recoverability test(3)	38		12,148	74		17,885	60		14,369
Total impairment charges—active stores	320		34,825	384		46,419	306		34,782
Total impairment charges—closed facilities	30		5,050	62		2,788	67		3,091
Total impairment charges—other(4)	—		—	—		14,285	—		—
Total impairment charges—all locations	350	$	39,875	446	$	63,492	373	$	37,873

(1) These charges are related to stores that were impaired for the first time in prior periods. In an effort to improve the operating results or to meet geographical competition, the Company will often make additional capital additions in stores that were impaired in prior periods. These additions will be impaired in future periods if they are deemed to be unrecoverable. In connection with our March 3, 2019 adoption of ASU 2016-02, Leases (Topic 842), under the alternative transition method, and the recording of our corresponding right-of-use asset (“ROU”). Beginning with fiscal 2020, the Company includes the ROU in its recoverability assessment. The fiscal 2020 impairment charge includes $6,594 of impairment relating to the ROU and $4,855 of capital additions.

(2) These charges are related to new stores (open at least three years) and relocated stores (relocated in the last two years) and significant strategic remodels (remodeled in the last year) that did not meet their recoverability test during the current period. These stores have not met their original return on investment projections and have a historical loss of at least two years. Their future cash flow projections do not recover their current carrying value. The fiscal 2020 impairment charge includes $5,625 of impairment relating to the ROU and $5,603 of capital assets.

(3) These charges are related to the remaining active stores that did not meet the recoverability test during the current period. These stores have a historical loss of at least 2 years. Their future cash flow projections do not recover their current carrying value. The fiscal 2020 impairment charge includes $2,228 of impairment relating to the ROU and $9,920 of capital assets.

(4) These fiscal 2019 charges were due to the impairment of assets related to the termination of a project to replace the point of sale software used in the Company’s stores.

Schedule of fair value of long-lived assets measured on recurring and non-recurring basis

							Fair Values		Total
							as of		Charges
	Level 1		Level 2		Level 3		Impairment Date		February 29, 2020
Long-lived assets held for use	$	—	$	113,510	$	278	$	113,788	$	(38,878)
Long-lived assets held for sale	$	—	$	2,689	$	—	$	2,689	$	(997)
Total	$	—	$	116,199	$	278	$	116,477	$	(39,875)

							Fair Values		Total
							as of		Charges
	Level 1		Level 2		Level 3		Impairment Date		March 2, 2019
Long-lived assets held for use	$	—	$	—	$	8,116	$	8,116	$	(62,115)
Long-lived assets held for sale	$	—	$	1,545	$	—	$	1,545	$	(1,377)
Total	$	—	$	1,545	$	8,116	$	9,661	$	(63,492)

Schedule of closed store and distribution center charges related to new closures, changes in assumptions and interest accretion

	Year Ended
	February 29,		March 2,		March 3,
	2020		2019		2018
	(52 Weeks)		(52 Weeks)		(52 Weeks)
Balance—beginning of period	$	124,046	$	133,290	$	165,138
Existing Topic 420 liabilities eliminated by recording a reduction to the ROU asset		(112,288)		—		—
Provision for present value of noncancellable lease payments of closed stores		—		35,190		8,871
Changes in assumptions about future sublease income, terminations and changes in interest rates		—		737		1,082
Interest accretion		—		9,741		11,439
Cash payments, net of sublease income		(9,505)		(54,912)		(53,240)
Balance—end of period	$	2,253	$	124,046	$	133,290

Schedule of revenue, operating expenses, and income before income taxes of stores

	Year Ended
	February 29,		March 2,		March 3,
	2020		2019		2018
Revenues	$	17,182	$	191,110	$	333,984
Operating expenses		18,046		209,645		369,859
Gain from sale of assets		(2,550)		(38,110)		(18,221)
Other expenses		776		2,490		2,442
Income (loss) before income taxes		910		17,085		(20,096)
Included in these stores’ loss before income taxes are:
Depreciation and amortization		292		960		2,058
Inventory liquidation charges		(486)		(5,536)		(2,828)