What is the present value of the minimum lease payments for Carls' company-operated operating leases in 2026?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
| n $ | 964 ======== |
|---|
Company as Lessee
The components of lease cost for January 31 , 2023 are as follows:
| Fiscal 2023 | |
|---|---|
| Finance lease cost: | |
| Amortization of finance lease assets $ | 2,432 |
| Interest on finance lease liabilities | 1,302 |
| Variable lease cost | 155 |
| Total finance lease cost $ | 3,889 |
| Operating lease cost | 84,890 |
| Variable lease cost | 1,135 |
| Total operating lease cost $ | 86,025 |
| Total lease cost $ | 89,914 |
Minimum lease payments for all leases and the present value of minimum lease payments for operating and finance leases as of January 31, 2023 are as follows:
| Finance Leases | Operation | eases | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Company- Operated | F | ranchise & Other | Company- Operated | Company- Operated | ranchise & Other | ||||||||||
| Fiscal: | П | ||||||||||||||
| 2024 | $ 731 | $ | 1,741 | $ | 15,015 | $ | 70,400 | ||||||||
| 2025 | 681 | 1,553 | 13,850 | 59,897 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, the minimum lease payments for all leases and the present value of minimum lease payments for operating and finance leases as of January 31, 2024, are detailed. For fiscal year 2026, the present value of the minimum lease payments for company-operated operating leases is $12,586.
This figure represents the discounted value of lease obligations that Carls has for its company-operated locations. It is important to note that this value only reflects the leases held directly by the company and not those of its franchisees. A prospective franchisee should consider this information in the context of their own potential lease obligations, which would be separate from these company-operated leases.
The FDD provides a snapshot of Carls's lease commitments as of a specific date, and these obligations can change over time due to various factors, such as lease renewals, new locations, or changes in lease terms. Therefore, while this information offers insight into Carls's financial obligations, it may not be fully representative of the current or future lease landscape for either the company or its franchisees.
Prospective franchisees should consult with Carls directly to obtain the most up-to-date information on lease obligations and to understand how these obligations might impact their own franchise operations. Additionally, franchisees should seek professional financial advice to fully assess the implications of lease commitments on their business.