As of January 2, 2023, what was the approximate amount of federal Net Operating Losses (NOLs) that Checkersrallys had?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
tment | | - | | - | | 181 | | 181 | | | Net income | | - | | - | | 21,260 | | 21,260 | | | Balances at December 30, 2024 | $ | - | $ | 98,449 | $ | 18,785 | $ | 117,234 | |
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
| Successor | Predecessor | |||||
|---|---|---|---|---|---|---|
| Year Ended December 30, 2024 | Period from June 17, 2023 through January 1, 2024 | Period from January 3, 2023 through June 16, 2023 | ||||
| Operating activities: | ||||||
| Net income (loss) | $ | 21,260 | $ | (2,570) | (91,106) | |
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||
| Depreciation and amortization | 9,312 | 4,638 | 8,552 | |||
| Amortization of deferred finan |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the provided financial statements do not explicitly state the exact amount of federal Net Operating Losses (NOLs) that Checkersrallys had as of January 2, 2023. However, the document includes the consolidated statements of cash flows, which show a net loss of $91,106,000 for the period from January 3, 2023, through June 16, 2023.
Additionally, the category of "Deferred income tax expense (benefit)" is listed with a value of ($7,529,000) for the same period. Deferred income tax benefits can often arise from net operating losses that can be carried forward to offset future taxable income. However, without more specific details, it's impossible to directly calculate the precise amount of NOLs available at that time.
A prospective franchisee should request further clarification from Checkersrallys regarding their net operating loss carryforwards and how these losses might impact the company's future tax liabilities and financial performance. Understanding the details of these NOLs is crucial for assessing the overall financial health and stability of the franchise system.