What was the net decrease/increase in cash for Browns Chicken in 2024?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
04 | 8.90 | | BROWN'S CHICKEN LLC | | | | | |
BROWN'S CHICKEN, LLC CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023
| 2024 | 2023 | |
|---|---|---|
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||
| Net (Loss) Earnings | $ (11,738) | $ 92,304 |
| Adjustments to Reconcile Net Earnings to Net | ||
| Cash Flows Provided By Operating Activities: | ||
| Non-Cash Items | ||
| Depreciation and Amortization | 11,020 | 11,713 |
| (Increase) Decrease in | ||
| Accounts Receivable | 32,514 | (2,690) |
| Uniform & Equipment Inventories | 343 | (595) |
| Prepaid Expenses | 2,400 | (4,798) |
| Increase in | ||
| Accounts Payable | 6,168 | 7,171 |
| Accrued Payroll | 1,256 | 69 |
| Total Adjustments | 53,701 | 10,870 |
| Net Cash Provided By Operating Activities | 41,963 | 103,174 |
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||
| Purchase of Property and Equpment | - | (10,664) |
| Net Cash (Used) | - | (10,664) |
| By Investing Activities | ||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||
| Payments on Notes Payable | - | (4,446) |
| Distributions to Members | (128,000) | (48,000) |
| Net Cash (Used) By Financing Activities | (128,000) | (52,446) |
| Net (Decrease) Increase In Cash | (86,037) | 40,064 |
| Cash at Beginning of |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 42)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, the company experienced a net decrease in cash of $86,037 in 2024. This is in contrast to 2023, where Browns Chicken saw a net increase in cash of $40,064. The end-of-year cash balance for 2024 was $57,969, compared to $144,006 at the end of 2023.
Several factors contributed to this decrease in cash. Browns Chicken's net loss for 2024 was $11,738, a significant change from the net earnings of $92,304 in 2023. Additionally, the company had distributions to members totaling $128,000 in 2024, while there were no payments on notes payable.
For a prospective franchisee, this information highlights the importance of understanding the factors that influence Browns Chicken's cash flow. While the company had positive cash flow from operating activities in both years, the distributions to members in 2024 significantly impacted the overall cash position. It would be prudent for a potential franchisee to inquire about the company's plans for managing cash flow and distributions in the future.
Reviewing Browns Chicken's complete financial statements and understanding the reasons behind these changes is essential for any potential franchisee. This includes analyzing the statement of cash flows in detail to assess the sustainability of the business model and its ability to generate positive cash flow under various economic conditions.