What was the total amount of other long-term liabilities reported for Carls in 2024?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
| 2025 | $ 16,202 |
|---|---|
| 2026 | 16,212 |
| 2027 | 16,410 |
| 2028 | 17,250 |
| 2029 | 17,813 |
| Thereafter | 66,043 |
| Total minimum lease payments | 149,930 |
| Less amount representing interest | (32,652) |
| Residual property obligation(1), deferred financing costs and deferred sales proceeds | 102,346 |
| Financing method sale-leaseback liability | 219,624 |
| Less current portion | (11,287) |
| Financing method sale-leaseback liability, less current portion | $ 208,337 |
(1) Although we have legally transferred title of the sale-leaseback properties, we have included an obligation to convey, for accounting purposes, the sale-leaseback assets at the end
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, the total amount of other long-term liabilities reported was $263,631. This figure represents the sum of several specific long-term liabilities, including $208,337 for the financing method sale-leaseback liability, $32,487 for deferred franchise and development fees, $9,568 for the estimated liability for self-insurance, $5,721 for deferred beverage income, $4,480 for unfavorable lease agreements, and $3,038 listed as 'other'.
For a prospective Carls franchisee, understanding these liabilities is crucial as they reflect Carls's long-term financial obligations. The sale-leaseback liability suggests Carls has engaged in transactions where it sold assets and then leased them back, which can impact cash flow. Deferred fees indicate revenue that has been collected but not yet earned, while self-insurance liabilities cover potential future claims that Carls is responsible for. Unfavorable lease agreements and other miscellaneous liabilities also contribute to the overall financial picture.
It's important to note that these liabilities are specific to Carls and its financial structure. Franchisees should review these figures in the context of Carls's overall financial health and consult with financial advisors to understand the potential implications for their investment. Comparing these figures to previous years, as provided in the table, can also offer insights into trends and changes in Carls's financial strategy. For instance, the total other long-term liabilities decreased from $277,497 in 2023 to $263,631 in 2024.