What was the net loss for 1 800 Packouts?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
----|--------------------| | Cost of revenues | | 10,001,056 | 5,463,228 | | Gross profit | | 24,596,601 | 20,563,296 | | Operating expenses: | | | | | Selling, general and administrative | | 20,522,378 | 18,837,743 | | Depreciation and amortization | | 11,307,800 | 10,597,574 | | Total operating expenses | _ | 31,830,178 | 29,435,317 | | Loss from operations | | (7,233,577) | (8,872,021) | | Other income (expense): | | | | | Interest expense | | (5,506,427) | (3,821,499) | | Gain on sale of unconsolidated subsidiary | | - | 1,025,637 | | Other income (expense) | | (204,868) | (51,463) | | Total other expense, net | | (5,711,295) | (2,847,325) | | Loss before income taxes | | (12,944,872) | (11,719,346) | | Income tax benefit (provision) | | (765,698) | 1,280,676 | | Net loss | $ | (13,710,570) | $ (10,438,670) |
| For the Year | s Ende | ed December 31, | ||
|---|---|---|---|---|
| 2023 | 2022 | |||
| Cash flows from operating activities: | ||||
| Net loss | $ | (13,710,570) | $ | (10,438,670) |
| Adjustments to reconcile net loss to net cash used in | ||||
| operating activities: | 44 470 440 | 40.550.470 | ||
| Amortization of goodwill and intangible assets Depreciation of fixed assets | 11,179,113 | 10,568,470 | ||
| Amortization of deferred financing costs | 128,687 237,783 | 29,104 213,726 | ||
| Amortization of operating lease right-of-use assets | 265,177 | 108,253 | ||
| Equity-based compensation | 201,589 | 100,233 | ||
| Gain on sale of unconsolidated subsidiary | - | (1,025,637) | ||
| Loss (gain) on disposal of fixed assets | (11,390) | 43,615 | ||
| Provision for bad debt | 47,293 | 25,950 | ||
| Decrease (increase) in: | , | |||
| Accounts receivable | (1,218,971) | (777,114) | ||
| Contract assets | (1,396,460) | (2,540,535) | ||
| Other assets | (428,865) | (535,234) | ||
| Increase (decrease) in: | ||||
| Accounts payable and accrued expenses | (593,573) | 2,012,196 | ||
| Contract liabilities | 3,834,331 | 3,647,786 | ||
| Operating lease liabilities | (243,367) | (76,533) | ||
| Deferred taxes | 424,255 | (1,269,181) | ||
| Net cash used in operating activities | _ | (1,284,968) | (13,804) | |
| Cash flows from investing activities: | ||||
| Purchase of property and equipment | (441,815) | (238,771) | ||
| Proceeds from sale of property and equipment | 83,000 | - | ||
| Contingent consideration paid | - | (1,200,000) | ||
| Proceeds from sale of unconsolidated subsidiary | - | 1,623,174 | ||
| Net cash paid for acquisitions | - | (46,109,861) | ||
| Net cash used in investing activities | (358,815) | (45,925,458) | ||
| Cash flows from financing activities: | ||||
| Member contributions | - | 29,025,980 | ||
| Borrowing on long-term debt | - | 20,100,000 | ||
| Payment of debt issuance costs | - | (307,500) | ||
| Repayment of long-term debt | (481,000) | (378,894) | ||
| Member distributions | _ | (404.000) | (250,000) | |
| Net cash provided by (used in) financing activities Net change in cash and restricted cash | _ | (481,000) | 48,189,586 2,250,324 | |
| Cash and restricted cash at beginning of year | 4,303,737 | , | ||
| _ | ,,, | • | 2,053,413 | |
| Cash and restricted cash at end of year | $ | 2,178,954 | $ | 4,303,737 |
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, the net loss for the year ended December 31, 2023, was approximately $13.71 million, while the net loss for the year ended December 31, 2022, was approximately $10.44 million. These figures reflect the overall financial performance of 1 800 Packouts during those periods. A prospective franchisee should carefully consider these losses and how the company plans to address them.
The FDD provides a detailed breakdown of cash flows from operating, investing, and financing activities, offering insight into how 1 800 Packouts manages its finances. For example, the document shows adjustments made to reconcile the net loss to net cash used in operating activities, such as amortization of goodwill and intangible assets, depreciation of fixed assets, and changes in accounts receivable and payable. Examining these adjustments can help a potential franchisee understand the non-cash expenses and working capital changes affecting the company's cash flow.
Furthermore, the document includes supplemental disclosures of cash flow information, such as cash paid for interest and income taxes, as well as non-cash investing and financing information, like cash acquired through acquisitions and contingent consideration settled through the issuance of equity. Understanding these supplemental disclosures can provide a more complete picture of 1 800 Packouts's financial activities and obligations. A prospective franchisee should consult with a financial advisor to fully understand the implications of these financial statements.