What was the total long-term debt, less the current portion, for the Carls franchise in 2023?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
| ASSETS | Carl's Jr. Restaurants LLC | Carl's Jr. Funding LLC | Carl's Jr. SPV Guarantor LLC | Hardee's Restaurants LLC | Hardee's Funding LLC | Hardee's SPV Guarantor LLC | Eliminations | The CKE Securitization Entities | ||
|---|---|---|---|---|---|---|---|---|---|---|
| Current assets: | ||||||||||
| Cash and cash equivalents $ | 2,117 $ | 3,996 $ | — $ | 3,685 $ | 2,542 $ | — $ — $ | 12,340 | |||
| Cash and cash equivalents - restricted | — | 15,942 | — | — | — | — | — | 15,942 | ||
| Accounts receivable, net | 11,160 | — | — | 10,588 | — | — | — | 21,748 | ||
| Due from affiliates | 11,625 | 20,328 | — | 56,241 | 238 | — | (88,007) | 425 | ||
| Inventories | 559 | — | — | 2,293 | — | — | — | 2,852 | ||
| Prepaid expenses | 112 | 22 | — | 314 | 22 | — | — | 470 | ||
| Other current assets | 79 | — | — | — | — | — | — | 79 | ||
| Total current assets | 25,652 | 40,288 | — | 73,121 | 2,802 | — | (88,007) | 53,856 | ||
| Property and equipment, net | 83,156 | — | — | 270,737 | — | — | — | 353,893 | ||
| Operating lease assets | 304,577 | — | — | 91,121 | — | — | — | 395,698 | ||
| Intangible assets, net | 378,456 | — | — | 399,082 | — | — | — | 777,538 | ||
| Other assets, net | 16,259 | — | — | 15,599 | — | — | — | 31,858 | ||
| Total assets $ | 808,100 $ | 40,288 $ | — $ | 849,660 $ | 2,802 $ | — $ (88,007) $ | 1,612,843 | |||
| LIABILITIES AND MEMBERS' DEFICIT | ||||||||||
| Current liabilities: | ||||||||||
| Current portion of long-term debt $ | — $ | 5,900 $ | — $ | — $ | 5,900 $ | — $ — $ | 11,800 | |||
| Current portion of finance leases | 698 | — | — | 817 | — | — | — | 1,515 | ||
| Current portion of operating leases | 57,919 | — | — | 15,854 | — | — | — | 73,773 | ||
| Accounts payable | 2,676 | — | — | 1,791 | — | — | — | 4,467 | ||
| Due to affiliates | 658 | 57,049 | — | 5,579 | 2 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 79–80)
What This Means (2024 FDD)
According to the 2024 FDD, the long-term debt, less the current portion, for several entities related to Carls is detailed. Specifically, Carl's Jr. Funding LLC had $554,012 in long-term debt, less the current portion, while Hardee's Funding LLC also had $554,012. The combined total long-term debt, less the current portion, for The CKE Securitization Entities was $1,108,024 in 2023.
This information is crucial for prospective Carls franchisees as it provides insight into the financial obligations of related entities. A high level of long-term debt could indicate financial strain or significant leverage, which might indirectly affect the franchise system's stability and ability to support its franchisees. Understanding the debt structure helps potential franchisees assess the overall financial health and risk associated with investing in a Carls franchise.
It is important to note that these figures represent the debt of specific entities within the CKE Securitization Entities, not necessarily the debt of the Carls franchise system as a whole. Franchisees should seek clarification from Carls regarding the specific financial obligations and how they might impact the franchise operations and support systems. Further due diligence, including consulting with a financial advisor, is recommended to fully understand the implications of these liabilities.