What was the total share-based compensation expense for Auntie Annes in 2023?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
assets | 13,305 | 13,532 | | Total assets | $ 882,596 | $ 876,517 |
Consolidated balance sheets (cont'd)
(In thousands except share data)
| December 31, 2023 | December 25, 2022 | |
|---|---|---|
| Liabilities and Member's Deficit | ||
| Current liabilities: | ||
| Accounts payable | $ 8,395 | $ 8,975 |
| Accrued expenses and other liabilities | 75,840 | 69,013 |
| Income taxes payable | 7,620 | 7,342 |
| Advertising funds liabilities | 8,942 | 12,693 |
| Deferred revenue | 3,149 | 3,721 |
| Current portion of operating lease liabilities | 12,309 | 15,889 |
| Current portion of long-term debt | 9,950 | 10,550 |
| Total current liabilities | 126,205 | 128,183 |
| Long-term debt | 1,258,205 | 1,151,023 |
| Long-term operating lease liabilities | 63,276 | 67,500 |
| Long-term deferred tax liabilities | 74,271 | 76,872 |
| Long-term deferred revenue | 55,362 | 56,549 |
| Long-term other liabilities | 1,458 | 1,596 |
| Total liabilities | 1,578,777 | 1,481,723 |
| Commitments and contingencies (see Note 11) | ||
| Member's deficit: | ||
| Member's def |
Source: Item 23 — RECEIPTS (FDD pages 106–366)
What This Means (2024 FDD)
According to Auntie Annes's 2024 Franchise Disclosure Document, the total share-based compensation expense for the fiscal year ended December 31, 2023, was $4,983. This expense reflects the cost of stock options and other equity instruments granted to employees, directors, and consultants of Auntie Annes's parent company. These incentives are designed to attract, retain, and motivate individuals to increase the value of the parent company's common stock.
The share-based compensation expense is a non-cash expense, meaning it does not involve an actual outflow of cash. Instead, it represents the accounting cost of these equity-based awards, recognized over the period the recipients provide service. The amount is determined using valuation models that consider factors such as the option's expected term, risk-free interest rate, and the volatility of comparable public entities, since the parent company lacks sufficient historical data on its own shares.
For a prospective Auntie Annes franchisee, understanding this expense can provide insight into the overall financial health and management practices of the franchisor. While the franchisee is not directly impacted by this expense, it reflects the franchisor's commitment to incentivizing its key personnel, which can indirectly benefit franchisees through improved support and innovation. Additionally, the FDD notes that the total compensation expense related to unvested awards not yet recognized in the financial statements is $6,642, which will be recognized as expense through 2028.