What was the net rent income for Carls in fiscal year 2024?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
Other Franchise & Company Operated Franchise & Other Fiscal: 2025 $ 1,573 $ 1,501 $ 15,730 $ 67,153 2026 1,629 1,426 14,906 59,669 2027 1,658 1,358 13,995 50,431 2028 1,672 1,302 12,851 42,140 2029 1,684 1,161 11,193 31,607 Thereafter 16,147 5,032 49,311 86,809 Total minimum lease payments 24,363 11,780 117,986 337,809 Less amount representing interest (8,010) (3,249) (12,640) (29,702) Present value of minimum lease payments 16,353 8,531 105,346 308,107 Less current portion (634) (881) (13,375) (60,398) Lease obligations, less current portion $ 15,719 $ 7,650 $ 91,971 $ 247,709 Net rent under non-cancelable operating leases was as follows:
| Fiscal 2024 | Fiscal 2023 | |
|---|---|---|
| Rent revenue: | ||
| Minimum rent revenue | $ 87,594 | $ 91,482 |
| Variable rent revenue | 6,334 | 6,622 |
| Total rent revenue | 93,928 | 98,104 |
| Rent expense: | ||
| Operating lease cost | (85,267) | (84,890) |
| Variable lease cost | (1,229) | (1,135) |
| Total operating lease cost | (86,496) | (86,025) |
| Net rent income | $ 7,432 | $ 12,079 |
Lease Term and Discount Rate as of January 31,
Weighted-average remaining lease term:
|
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, two different net rental incomes are reported for fiscal year 2024. One table shows a net rent income of $7,432, while another table shows $2,956. These discrepancies could be due to different accounting methods, the inclusion of different subsidiaries, or corrections made during the auditing process.
A prospective franchisee should seek clarification from Carls regarding these differing figures. Understanding the basis for each calculation is crucial for assessing the financial health and stability of the franchise system. It is important to determine which calculation is most relevant to the franchisee's specific situation and investment.
It is also advisable to consult with a financial advisor to analyze these figures in the context of the entire FDD and the franchisee's business plan. This will help in making an informed decision about investing in a Carls franchise.