What were the transaction costs for Benihana in 2022?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
interested parties to evaluate companies in our industry. We use Adjusted EBITDA and Restaurant Operating Profit, alongside other GAAP measures such as net income, to measure profitability, as a key profitability target in our budgets, and to compare our performance against that of peer companies despite possible differences in calculation.
Please refer to the table on page 30 for our reconciliation of net income to EBITDA and Adjusted EBITDA and for a reconciliation of operating income to Restaurant Operating Profit.
Results of Operations
The following table sets forth certain statements of operations data for the periods indicated (in thousands):
| For the year ended December 31, | ||||
|---|---|---|---|---|
| 2023 | 2022 | |||
| Revenues: | ||||
| Owned restaurant net revenue | $ | 317,366 | $ | 300,859 |
| Management, license and incentive fee revenue | 15,403 | 15,779 | ||
| Total revenues | 332,769 | 316,638 | ||
| Cost and expenses: | ||||
| Owned operating expenses: | ||||
| Owned restaurant cost of sales | 75,727 | 75,365 | ||
| Owned restaurant operating expenses | 191,250 | 174,689 | ||
| Total owned operating expenses | 266,977 | 250,054 | ||
| General and administrative (including stock-based compensation of $5,032 | ||||
| and $3,985 for the years ended December | 30,751 | 29,081 | ||
| 31, | ||||
| 2023 and 2022, respectively) | ||||
| Depreciation and amortization | 15,664 | 12,134 | ||
| Pre-opening expenses | 8,855 | 5,519 | ||
| Transaction costs | 207 | 123 | ||
| Lease termination |
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, the transaction costs for the year ended December 31, 2022, were $123. This figure is part of the broader costs and expenses that Benihana incurs, which totaled $300,332 for that year. Understanding transaction costs can help a prospective franchisee assess the overall financial health and operational efficiency of the company.
Transaction costs are a component of Benihana's overall expenses, which also include owned restaurant cost of sales, operating expenses, general and administrative costs, depreciation and amortization, COVID-19 related expenses, lease termination expenses, pre-opening expenses, and write-offs. These costs, when combined, provide a comprehensive view of the expenses involved in running the Benihana business. For comparison, in 2021, Benihana's transaction costs were $160, indicating a decrease in these costs in 2022.
For a potential Benihana franchisee, it's important to note that while transaction costs are a relatively small portion of the overall expenses, they can fluctuate year to year. These costs may be associated with activities such as capital raising or financing. Therefore, understanding the factors that influence these costs and their potential impact on the bottom line is crucial for making an informed investment decision. Reviewing these figures in the context of the overall financial performance provides a more complete picture of the franchise's financial dynamics.