What was the total depreciation and amortization for Carls in fiscal year 2024?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
---------------------------------------------|---------------------| | Capital contributions | 45,394 | | Distributions to members | (139,428) | | Net income | 97,797 | | Cumulative effect of change in accounting principle (Note 9) | (452) | | Balance as of January 31, 2023 | (248,506) | | Capital contributions | 35,679 | | Distributions to members | (133,746) | | Net income | 108,945 | | Balance as of January 31, 2024 | $ (237,628) |
THE CKE SECURITIZATION ENTITIES COMBINED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)
| Fiscal 2024 | Fiscal 2023 | |
|---|---|---|
| Cash flows from operating activities: | ||
| Net income $ | 108,945 | $ 97,797 |
| Adjustments to reconcile net income to net cash provided by operating activities: | ||
| Depreciation and amortization | 46,692 | 44,580 |
| Amortization of deferred financing costs | 3,419 | 3,352 |
| Gain on early termination of lease agreement associated with a financing method sale-leaseback | — | (1,285) |
| restaurant property | ||
| Gain on refranchising transaction | (817) | — |
| (Gain) loss on disposal of other property and equipment | (602) | 512 |
| Provision for losses on impairments, accounts receivable and other items, net | 4,806 | 318 |
| Net changes in operating assets and liabilities: | ||
| Receivables, inventories, prepaid expenses and other current and non-current assets | (1,985) | 4,247 |
| Accounts payable and other current and long-term liabilities | (3,089) | (13,013) |
| Operating lease assets and liabilities, net | 1,096 | 511 |
| Net cash provided by operating activities | 158,465 | 137,019 |
| Cash flows from investing activities: | ||
| Proceeds from refranchising transactions | 2,092 | — |
| Proceeds from sale of other property and equipment | 2,412 | 1,957 |
| Other investing activities | 154 | 215 |
| Net cash provided by investing activities | 4,658 | 2,172 |
| Cash flows from financing activities: | ||
| Net change in book overdraft | (1,260) | (1,952) |
| Repayments of Class A-2 Notes | (11,800) | (11,800) |
| Payment for deferred financing costs of Series 2018-1 VFN Notes | — | (861) |
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, the total depreciation and amortization for fiscal year 2024 was $46,692. This figure is an adjustment to reconcile net income to net cash provided by operating activities. In the previous fiscal year 2023, the depreciation and amortization was $44,580.
Depreciation and amortization are accounting methods used to allocate the cost of tangible assets (like equipment and buildings) and intangible assets (like patents and trademarks) over their useful lives. For Carls, this expense reflects the reduction in value of its assets used in operations during the reported periods. It's a non-cash expense, meaning it doesn't involve an actual outflow of cash, but it does reduce the company's reported net income.
For a prospective Carls franchisee, understanding depreciation and amortization is important for assessing the company's financial health and profitability. While franchisees don't directly deal with these specific corporate-level calculations, they reflect the overall capital investment and asset management strategies of the company. A significant change in these figures year-over-year could signal changes in investment strategies or asset utilization, which could indirectly affect franchisees.