How did the loss on investment in unconsolidated entities for Camp Margaritaville change between 2022 and 2023?
Camp_Margaritaville Franchise · 2025 FDDAnswer from 2025 FDD Document
| Year Ended December 31 | ||||
|---|---|---|---|---|
| 2023 2024 | ||||
| Revenues | ||||
| Restaurant and retail merchandise sales | $ 6,495,530 | $ 6,784,532 | ||
| Restaurant royalties | 9,480,337 | 10,166,895 | ||
| Resort royalties | 31,673,974 | 29,097,964 | ||
| Residential and timeshare royalties | 37,379,336 | 35,130,754 | ||
| Consumer products royalties | 4,594,556 | 4,199,315 | ||
| Other revenue | 15,010,443 | 7,108,803 | ||
| Total revenues | 104,634,176 | 92,488,263 | ||
| Operating expenses | ||||
| Cost of restaurant and retail merchandise sales | 1,710,201 | 1,814,546 | ||
| Selling, general, and administrative | 68,220,301 | 65,463,612 | ||
| Depreciation | 1,447,387 | 1,433,243 | ||
| Total operating expenses | 71,377,889 | 68,711,401 | ||
| Income from operations | 33,256,287 | 23,776,862 | ||
| Other income (expenses) | ||||
| Net loss from investments in unconsolidated entities | – | (2,000,000) | ||
| Net loss on sale of venues | – | ( |
Source: Item 23 — RECEIPTS (FDD pages 72–406)
What This Means (2025 FDD)
According to Camp Margaritaville's 2025 Franchise Disclosure Document, the loss on investment in unconsolidated entities changed from $2,000,000 in 2022 to $0 in 2023. This indicates a significant shift in the financial performance related to these investments.
The change is further explained in Note 5, which details Camp Margaritaville's 3.2% interest in 560 MV Hotel LLC, a resort in New York. In October 2023, the majority owner of the resort foreclosed on its loan agreement, and in December 2023, the lender assumed control of the property. As a result, Camp Margaritaville lost its ownership interest and fully impaired its investment in the property. This impairment loss is reflected in the net loss on investments in unconsolidated entities.
For a prospective franchisee, this information highlights the risks associated with investments in unconsolidated entities. While Camp Margaritaville licenses its brand to various ventures, the financial performance of these ventures can directly impact the company's financial statements. The loss of $2,000,000 in 2022 demonstrates the potential for significant losses, while the $0 in 2023 reflects the complete write-off of the investment due to foreclosure. This situation underscores the importance of understanding the financial health and stability of any entities Camp Margaritaville is affiliated with, as their performance can affect the overall financial picture of the company.