What was the total amount of interest expenses for Churchs Chicken as of December 31, 2023?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
| Dec | cember 31, | De | cember 25, | |
|---|---|---|---|---|
| 2023 | 2022 | |||
| Revenues | ||||
| Sales by company-operated restaurants | S | 156,268 | S | 141,936 |
| Franchise revenue | 58,655 | 54,276 | ||
| Rental and other income | 8,380 | 8,781 | ||
| Total revenues | 223,303 | 204,993 | ||
| Operating costs and expenses | ||||
| Company-operated restaurant expenses: | ||||
| Food, beverage and packaging | 48,155 | 45,690 | ||
| Payroll and benefits | 42,744 | 40,009 | ||
| Other operating expenses | 37,842 | 37,204 | ||
| General and administrative expenses | 21,716 | 22,378 | ||
| Depreciation and amortization | 19,924 | 18,600 | ||
| Impairment, special charges and (gain) loss on asset dispositions | 2,554 | (954) | ||
| Total operating costs and expenses | 172,935 | 162,927 | ||
| Operating income | 50,368 | 42,066 | ||
| Interest expense, net | 28,140 | 26,861 | ||
| Income before income taxes | 22,228 | 15,205 | ||
| Income tax expense | 3,378 | 2,905 | ||
| Net income | S | 18,850 | $ | 12,300 |
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 35–43)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, the total interest expense, net, for the year ending December 31, 2023, was $28,140. This figure reflects the cost the company incurred for its debt obligations during that period. For comparison, the interest expense, net, for the year ending December 25, 2022, was $26,861.
This information is relevant to a prospective franchisee because it provides insight into Churchs Chicken's financial health and how it manages its debt. A higher interest expense could indicate that the company has significant debt or less favorable borrowing terms, which might affect its profitability and ability to support its franchisees. Conversely, a stable or decreasing interest expense could suggest sound financial management.
It is important to note that this interest expense is at the corporate level and does not directly reflect the financing costs a new franchisee might incur to open their own Churchs Chicken restaurant. However, understanding the financial obligations of the parent company can help franchisees assess the overall stability and risk associated with investing in the franchise system. Franchisees should consult with financial advisors to understand the implications of Churchs Chicken's financial statements in detail.