What was Budget's total property lease expense for the year ended December 31, 2024?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
erms. We believe that, based on current market conditions, the net proceeds from the sale of these vehicles at the end of their lease terms will equal or exceed their net book values and therefore have not recorded a liability related to guaranteed residual values.
The components of lease expense are as follows:
| The components of lease expense are as follows: | Year E | Ended December 31, |
|---|
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the total property lease expense for the year ended December 31, 2024, was $1,272. This figure is comprised of several components: property leases which amounted to $935, operating lease expense of $343, and a reduction of $6 for sublease income.
For a prospective Budget franchisee, understanding these lease expenses is crucial. Property lease expenses can significantly impact the profitability of a franchise location. The operating lease expense likely covers costs associated with using the property, while sublease income, if applicable, can offset some of these expenses.
It's important for potential franchisees to investigate the details behind these figures. Understanding the terms of the property leases, the nature of the operating lease expenses, and the potential for sublease income can help in accurately forecasting the financial performance of their franchise. Furthermore, comparing these figures with industry benchmarks and similar franchise locations can provide valuable insights.