What was the total value of Carvel's current liabilities as of December 29, 2023?
Carvel Franchise · 2025 FDDAnswer from 2025 FDD Document
1,748 and $1,143 in 2024 and 2023, respectively | | 44,272 | 37,049 | | Inventories | | 1,128 | 978 | | Prepaid expenses and other current assets | | 12,118 | 9,263 | | Advertising funds assets | | 9,927 | 7,643 | | Intercompany receivables from Parent | | 3,277 | 3,277 | | Total current assets | | 115,063 | 110,454 | | Property, equipment, leasehold improvements and land, net | | 71,417 | 71,199 | | Operating lease assets, net | | 62,676 | 69,535 | | Goodwill | | 122,714 | 122,714 | | Intangible assets, net | | 496,479 | 495,389 | | Long-term other assets | | 13,986 | 13,305 | | Total assets | $ | 882,335 | $ 882,596 |
Consolidated balance sheets (cont'd)
| December 29, 2024 | December 31, 2023 | |
|---|---|---|
| Liabilities and Member's Deficit | ||
| Current liabilities: | ||
| Accounts payable | $ 5,320 | $ 8,395 |
| Accrued expenses and other liabilities | 81,587 | 75,840 |
| Income taxes payable | 3,851 | 7,620 |
| Advertising funds liabilities | 8,418 | 8,942 |
| Current portion of deferred revenue | 3,688 | 3,149 |
| Current portion of operating lease liabilities |
Source: Item 23 — Receipts (FDD pages 100–353)
What This Means (2025 FDD)
According to Carvel's 2025 Franchise Disclosure Document, the company's total current liabilities as of December 31, 2023, amounted to $126,205. This figure represents the sum of several short-term financial obligations, including accounts payable, accrued expenses, income taxes payable, advertising funds liabilities, the current portion of deferred revenue, the current portion of operating lease liabilities, and the current portion of long-term debt.
For a prospective Carvel franchisee, understanding the composition and magnitude of these current liabilities is crucial. It provides insight into the franchisor's short-term financial health and its ability to meet its immediate obligations. A high level of current liabilities relative to current assets could indicate potential liquidity issues, which might affect the franchisor's ability to support its franchisees or invest in the brand.
It is also useful to compare these figures with previous years and with other franchise systems in the same industry. This comparative analysis can reveal trends and highlight any areas of concern. For instance, the FDD shows that Carvel's total current liabilities decreased slightly from $126,205 in 2023 to $125,210 in 2024. While this decrease could be a positive sign, further investigation into the specific components of these liabilities would be warranted to fully understand the implications.
Prospective franchisees should carefully review Carvel's financial statements and consult with a financial advisor to assess the franchisor's financial stability and its potential impact on their investment. Understanding the franchisor's financial obligations and how they are managed is an essential part of the due diligence process.