What was the net loss/income for Brain Balance in 2024?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
| Years Ended December 31, 2024, 2023, and 2022 | ||||
|---|---|---|---|---|
| 2024 | 2023 | 2022 | ||
| Cash Flows from Operating Activities | ||||
| Net (loss) income | $(324,837) $ | 161,876 $ | 307,374 | |
| Adjustments to reconcile net (loss) income to net cash and | ||||
| restricted cash from operating activities: | ||||
| Depreciation and amortization | 49,819 | 29,920 | 24,806 | |
| Credit loss expense | 59,741 | 5,560 | - | |
| Changes in operating assets and liabilities that (used) | ||||
| provided cash and restricted cash: | ||||
| Accounts receivable | (126,097) | 42,623 | (75,804) | |
| Deferred franchise costs | 20,050 | 23,393 | 19,952 | |
| Prepaid expenses and other assets | (33,382) | (10,615) | 53,332 | |
| Accounts payable and accrued expenses | (66,584) | (46,246) | 81,063 | |
| Deferred revenue | 16,809 | (89,332) | (96,172) | |
| Accrued advertising expenses | (56,130) | (98,824) | 84,461 | |
| Net cash and restricted cash (used in) provided | ||||
| by operating activities | (460,611) | 18,355 | 399,012 | |
| Cash Flows from Investing Activities | ||||
| Issuance of notes receivable | (61,946) | - | - | |
| Purchases of website and software development assets | (52,423) | (146,179) | (41,022) | |
| Payments on notes receivable | 31,221 | - | 20,000 | |
| Net cash and restricted cash used in investing | ||||
| activities | (83,148) | (146,179) | (21,022) | |
| Cash Flows from Financing Activities | ||||
| Advance to related party | - | - | (422,848) | |
| Payments on debt | (3,515) | (7,507) | (3,006) | |
| Member contribution | 539,393 | 109,029 | - | |
| Net cash and restricted cash provided by (used | ||||
| in) financing activities | 535,878 | 101,522 | (425,854) | |
| Net Decrease in Cash and Restricted Cash | (7,881) | (26,302) | (47,864) | |
| Cash and Restricted Cash - Beginning of year | 155,826 | 182,128 | 229,992 | |
| Cash and Restricted Cash - End of year | $147,945 $ | 155,826 $ | 182,128 | |
| Classification of Cash and Restricted Cash | ||||
| Cash | $64,403 $ | 21,796 $ | 61,068 | |
| Restricted cash | 83,542 | 134,030 | 121,060 | |
| $147,945 $ | 155,826 $ | 182,128 | ||
| Total cash and restricted cash | ||||
| Supplemental Cash Flow Information - Cash paid for interest | $5,988 $ | 5,671 $ | 5,784 | |
| Significant Noncash Transactions - Amounts advanced to | ||||
| related parties in 2022 and reclassified as distributions in 2022 | $ | - $ | - $ | 422,848 |
Source: Item 23 — RECEIPTS (FDD pages 72–292)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, the company experienced a net loss of $324,837 in 2024. This figure is part of the cash flow statement, which also details adjustments to reconcile this net loss with net cash flow from operating activities. These adjustments include depreciation and amortization ($49,819), credit loss expense ($59,741), and changes in various operating assets and liabilities.
Specifically, the cash flow statement outlines how the net loss impacts the overall cash flow. For example, changes in accounts receivable resulted in a decrease of $126,097, while deferred franchise costs increased by $20,050. Prepaid expenses and other assets decreased by $33,382. These adjustments are crucial for understanding the true cash position of Brain Balance, as net income or loss alone does not provide a complete picture.
In addition to operating activities, the cash flow statement also covers investing and financing activities. Investing activities included the issuance of notes receivable (a decrease of $61,946) and purchases of website and software development assets (a decrease of $52,423). Financing activities show a member contribution of $539,393. These activities, combined with the operating cash flows, ultimately resulted in a net decrease in cash and restricted cash of $7,881 for Brain Balance during 2024. Understanding these cash flow dynamics is essential for assessing the financial health and stability of Brain Balance as a franchise system.