What was the total value of Canopy Lawn Care's right-of-use assets in 2024?
Canopy_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
LLC CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, 2024, 2023, AND 2022
ASSETS
| 2024 | 2023 ("As Restated") | 2022 ("As Restated") | |
|---|---|---|---|
| Current Assets | |||
| Cash | $ 2,941,232 | $ 1,737,401 | $ 1,492,295 |
| Royalties and accounts receivable, net | 10,215,595 | 8,416,631 | 5,544,544 |
| Rebates receivable, net | 1,889,160 | 1,815,484 | - |
| Notes receivable | 97,904 | 24,492 | 231,429 |
| Inventory | 3,461,346 | 3,215,098 | 950,753 |
| Prepaid expenses and other | 854,615 | 2,211,505 | 1,436,976 |
| Total Current Assets | 19,459,852 | 17,420,611 | 9,655,997 |
| Property and Equipment, Net | 3,998,259 | 3,511,245 | 1,952,874 |
| Other Assets | |||
| Notes receivable, net of current portion | 623,693 | 293,452 | 199,591 |
| Intangibles, net | 237,978,533 | 246,073,099 | 153,303,800 |
| Right-of-use assets | 4,548,121 | 2,972,324 | - |
| Other assets | 37,688 | 28,923 | 28,923 |
| Due from affiliated companies | - | - | 958,379 |
| 243,188,035 | 249,367,798 | 154,490,693 | |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 55)
What This Means (2025 FDD)
According to Canopy Lawn Care's 2025 Franchise Disclosure Document, the total value of its right-of-use assets in 2024 was $4,548,121. This figure represents the value of assets that Canopy Lawn Care has the right to use under lease agreements.
Right-of-use assets are a common element on the balance sheets of businesses that lease property or equipment rather than owning them outright. The value is derived from the company's adoption of Accounting Standards Update (ASU) 2016-02, Leases (Topic 842) on October 1, 2022, which initially led to recording ROU assets of approximately $3,398,000 and corresponding operating lease liabilities of approximately $3,954,000. The difference between the ROU asset and operating lease liability at inception was due to a deferred rent and certain tenant allowances of approximately $556,000 at October 1, 2022, which was netted against the ROU asset.
During 2024, Canopy Lawn Care obtained additional ROU assets through operating leases of approximately $484,000. This indicates that the company continued to expand its operations or acquire new assets through leasing agreements. For a prospective franchisee, understanding the nature and extent of these leased assets is important, as it can provide insights into the company's operational footprint and its ongoing lease obligations. Reviewing the lease terms and conditions would be a crucial part of due diligence.
It is important to note that these figures are part of the consolidated financial statements of Outdoor Living Brands Holdco, LLC, which includes Canopy Lawn Care and other franchise brands. Therefore, the right-of-use assets figure reflects the total for the consolidated group, not just Canopy Lawn Care in isolation. A prospective franchisee should seek clarification on how these assets are specifically utilized within the Canopy Lawn Care business and how they contribute to the overall financial performance of the franchise system.