What was the cash paid for interest, net of amounts capitalized, for Carls in fiscal year 2023?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
| Fiscal 2024 | Fiscal 2023 | ||
|---|---|---|---|
| Cash paid for: | |||
| Interest, net of amounts capitalized | $ | 59,155 | $ 60,073 |
| Income taxes | 5,737 | 5,053 | |
| Non-cash activities: | |||
| Operating lease assets obtained in exchange for new operating lease liabilities | 65,562 | 46,212 | |
| Contributed property and equipment(1) | 28,511 | 45,394 | |
| Contributed other assets(1) | 3,730 | — | |
| Contributed assets for the CKE Restaurants Acquisition (see Note 5)(1) | 3,438 | — | |
During fiscal 2024 and 2023, we capitalized interest costs in the amounts of $180 and $325, respectively.
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, the cash paid for interest, net of amounts capitalized, was $60,073 for the fiscal year 2023. This figure represents the actual cash outflow Carls made to cover its interest expenses, after accounting for any interest that was capitalized, meaning it was added to the cost of an asset rather than expensed immediately.
For a prospective franchisee, understanding this figure provides insight into Carls's financial management and debt obligations. It shows how much cash Carls is using to service its debt. A higher interest payment could indicate higher debt levels, which might concern potential investors or franchisees.
It's also worth noting that during fiscal years 2024 and 2023, Carls capitalized interest costs in the amounts of $180 and $325, respectively. Capitalizing interest can improve the company's profitability metrics in the short term, but it's essential to consider the overall debt and interest expense when evaluating the financial health of the company.