What was the amortization of debt issuance costs for Basecamp Fitness in 2024 (in thousands of US dollars)?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
| (in thousands of US dollars) | 2024 2023 2022 | |
|---|---|---|
| Cash flows from operating activities | ||
| Net income | $ 113,091 $ 54,308 $ 60,705 | |
| Adjustments to reconcile net income to net cash flows | ||
| from operating activities | ||
| Depreciation and amortization | 13,831 6,125 2,705 | |
| Amortization of debt issuance costs, included in interest expense | 3,970 1,740 1,740 | |
| Loss on sale of property and equipment | - 112 2 |
Source: Item 23 — RECEIPTS (FDD pages 62–248)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, the amortization of debt issuance costs, included in interest expense, was $3,970 (in thousands of US dollars) for the year 2024. This figure represents the expense recognized during the year related to the cost of obtaining debt financing. These costs, initially recorded as a reduction of long-term debt, are amortized to interest expense over the anticipated repayment dates of the debt.
For a prospective Basecamp Fitness franchisee, understanding the amortization of debt issuance costs provides insight into the company's financial management and how it handles its debt obligations. The debt issuance costs of $14,892 were recorded as a reduction of long-term debt in connection with the issuance of the Series 2024-1 Notes. The franchisee should note that these costs are amortized to interest expense through the anticipated repayment dates. This amortization is a non-cash expense, meaning it doesn't represent an actual outflow of cash during the period, but it does reduce the company's reported net income.
It's important to consider this figure in the context of Basecamp Fitness's overall financial health and debt structure. The FDD also mentions that the Series 2024-1 Notes and Series 2021-1 Notes are subject to a series of covenants and restrictions customary for this type of transaction, including debt service and securitized net cash flow coverage ratios, maintenance of specified reserve accounts, and provisions relating to optional and mandatory prepayments. The company was in compliance with its financial covenants for each quarter in the years ended December 31, 2024 and 2023. Franchisees should be aware of these financial obligations and how they might impact the franchisor's ability to support its franchisees.
In summary, the $3,970 amortization of debt issuance costs in 2024 reflects the systematic expensing of costs associated with Basecamp Fitness's debt financing. While it's a non-cash expense, it's a factor in the company's profitability and overall financial management, which are important considerations for potential franchisees.