What were 360 Painting's general and administrative expenses in 2024?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
Charlottesville, Virginia
April 22, 2025
| 2024 | 2023 | ||
|---|---|---|---|
| Assets | |||
| Current assets | |||
| Cash and cash equivalents | $ 943,020 $ | 722,074 | |
| Accounts receivable, net | 3,218,426 | 2,838,106 | |
| Prepaid expenses and other current assets | 3,666,212 | 2,486,419 | |
| Total current assets | 7,827,658 | 6,046,599 | |
| Property and equipment, net | 762,462 | 728,024 | |
| Right-of-use lease asset, net | 1,476,728 | 1,633,661 | |
| Intangible assets, net | 11,433,105 | 12,925,497 | |
| Goodwill | 7,068,689 | 7,068,689 | |
| Other assets | 7,888,574 | 7,097,279 | |
| Total assets | $ 36,457,216 $ | 35,499,749 | |
| Liabilities and Members' Deficit | |||
| Current liabilities | |||
| Accounts payable | $ 434,745 $ | 435,883 | |
| Accrued and other liabilities | 3,365,005 | 3,368,024 | |
| Deferred revenue, current | 2,041,424 | 1,860,040 | |
| Lease liability, current portion | 150,635 | 124,701 | |
| Current maturities of long-term debt | 609,375 | 599,500 | |
| Total current liabilities | 6,601,184 | 6,388,148 | |
| Long-term debt, net | 20,436,661 | 19,918,725 | |
| Lease liability, noncurrent portion | 1,416,676 | 1,568,558 | |
| Deferred revenue, noncurrent | 13,875,809 | 12,809,637 | |
| Total liabilities | 42,330,330 | 40,685,068 | |
| Members' deficit | (5,873,114) | (5,185,319) | |
| Total liabilities and members' deficit | $ 36,457,216 $ | 35,499,749 | |
| 2024 | 2023 | ||
| ------------------------------------- | ------------------------ | ------------ | |
| Revenues | |||
| Franchise service fees | $ 17,697,574 $ | 17,385,428 | |
| Franchise sales fees | 6,173,857 | 4,940,724 | |
| Other revenues | 1,570,613 | 1,266,744 | |
| Total revenues | 25,442,044 | 23,592,896 | |
| Costs and expenses | |||
| Franchise support expenses | 10,331,257 | 9,990,315 | |
| Franchise sales expenses | 6,025,688 | 5,579,325 | |
| General and administrative expenses | 4,974,157 | 4,311,590 | |
| Transaction costs | - | 103,047 | |
| Depreciation and amortization | 1,983,683 | 1,804,818 | |
| Total costs and expenses | 23,314,785 | 21,789,095 | |
| Operating income | 2,127,259 | 1,803,801 | |
| Interest income | (620) | (2,443) | |
| Interest expense | 2,815,674 | 2,540,123 | |
| Net loss | $ (687,795) $ | (733,879) | |
| Members' Capital | Accumulated Deficit | Members' Deficit | |
| -------------------------------------- | ------------------------- | ------------------------ | ------------------------ |
| Balances at December 31, 2022 | $ (3,015,800) $ | (685,640) $ | (3,701,440) |
| Net loss | - | (733,879) | (733,879) |
| Distributions to Members | (750,000) | - | (750,000) |
| Balances at December 31, 2023 | $ (3,765,800) $ | (1,419,519) $ | (5,185,319) |
| Net loss | - | (687,795) | (687,795) |
| Balances at December 31, 2024 | $ (3,765,800) $ | (2,107,314) $ | (5,873,114) |
| 2024 | 2023 | ||
| ---------------------------------------------------------------- | ----------------------- | ------------- | |
| Cash flows from operating activities | |||
| Net loss | $ (687,795) $ | (733,879) | |
| Adjustments to reconcile net income to net cash | |||
| provided by (used in) operating activities | |||
| Depreciation and amortization | 1,983,683 | 1,804,818 | |
| Amortization of deferred loan costs | 91,061 | 79,207 | |
| Changes in assets and liabilities | |||
| Accounts receivable | (380,320) | (661,073) | |
| Prepaid expenses and other current assets | (1,179,793) | (31,950) | |
| Other assets | (791,295) | (1,564,311) | |
| Accounts payable | (1,138) | 243,259 | |
| Accrued and other liabilities | (3,018) | 209,310 | |
| Deferred revenue | 181,384 | 311,391 | |
| Lease liability | (125,948) | (102,966) | |
| Other long-term liabilities | 1,066,172 | 1,908,039 | |
| Net cash provided by operating activities | 152,993 | 1,461,845 | |
| Cash flows from investing activities | |||
| Business acquisitions, net of cash acquired | - | (5,979,862) | |
| Purchases of property and equipment | (81,518) | (117,758) | |
| Capitalized software development costs | (287,279) | (405,933) | |
| Net cash used in investing activities | (368,797) | (6,503,553) | |
| Cash flows from financing activities | |||
| Member distributions | - | (750,000) | |
| Borrowings from long-term debt, net of deferred financing cost | 1,200,000 | 6,778,500 | |
| Repayments of long-term debt | (763,250) | (1,164,875) |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 56)
What This Means (2025 FDD)
According to 360 Painting's 2025 Franchise Disclosure Document, the company's general and administrative expenses for the year 2024 were $4,974,157. This figure is part of the broader financial statement that includes revenues, costs, and expenses, ultimately leading to the calculation of net income or loss. Reviewing these expenses can provide insight into the operational costs incurred by 360 Painting to support its franchise system.
General and administrative expenses typically encompass costs not directly tied to franchise support or sales, such as salaries for executive staff, office supplies, rent, utilities, and other overhead costs. For a prospective franchisee, understanding the breakdown of these expenses can offer a clearer picture of how 360 Painting manages its resources and invests in its infrastructure. It's also worth noting that the general and administrative expenses for 2023 were $4,311,590, indicating an increase in these expenses from 2023 to 2024.
Analyzing these figures in comparison to revenues and other expenses can help potential franchisees assess the financial health and efficiency of 360 Painting. A significant increase in general and administrative expenses without a corresponding rise in revenue could signal potential inefficiencies or increased investment in the company's infrastructure. Therefore, it is advisable for prospective franchisees to further investigate the reasons behind these expenses and how they might impact the overall profitability and sustainability of the franchise system.
It is important to note that these figures are part of the consolidated financial statements of Premium Service Brands, LLC and Subsidiaries, which includes 360 Painting. The FDD states that 360 Painting's separate financial statements are not included in the document. Therefore, prospective franchisees should consider requesting these separate financial statements to gain a more detailed understanding of 360 Painting's financial performance.