What was the total value of Churchs Chicken's long-term finance lease liabilities in 2021?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
| Assets | - | 2021 | 1010 | |
|---|---|---|---|---|
| Current assets: | ||||
| Cash and cash equivalents | S | 3,551 | $ | 4,189 |
| Restricted cash | 2,058 | 2,163 | ||
| Accounts receivable, net | 8,210 | 6,351 | ||
| Inventory | 820 | 735 | ||
| Prepaid expenses and other | 468 | 4.493 | ||
| Due from member | 75,691 | 58,588 | ||
| Total current assets | 90,798 | 76,519 | ||
| Long-term assets: | ||||
| Property and equipment, net | 111,791 | 120,042 | ||
| Finance lease right-of-use assets | 13,266 | 7,131 | ||
| Operating lease right-of-use assets | 24,572 | 24,221 | ||
| Trademarks and other intangible assets, net | 285,311 | 294,128 | ||
| Goodwill | 26,390 | 30,160 | ||
| Other assets, net | 1,247 | 1,389 | ||
| Total long-term assets | - | 462,577 | 477,071 | |
| Total assets | S | 553,375 | S | 553,590 |
| Liabilities and members' equity | ||||
| Current liabilities: | ||||
| Accounts payable | S | 6,232 | S | 8,348 |
| Accrued liabilities | F. | 4,932 | 21 | 5,614 |
| Current maturities of long-term debt | 1,919 | 5,637 | ||
| Current finance lease liabilities | 486 | 269 | ||
| Current operating lease liabilities | 3,223 | 3,263 | ||
| Total current liabilities | > | 16,792 | 23,131 | |
| Long term liabilities: | ||||
| Long-term finance lease liabilities | 15,532 | 8.904 | ||
| Long-term operating lease liabilities | 24,378 | 24,849 | ||
| Long-term debt, net of current maturities | 312,299 | 322,422 | ||
| Deferred credits and other long-term liabilities | 16,206 | 17,818 | ||
| Total long-term liabilities | 368,415 | 373,993 | ||
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 company's total long-term finance lease liabilities in 2021 were $8,904. This figure represents the financial obligations Churchs Chicken had for leases extending beyond one year, specifically those classified as finance leases. Finance leases typically involve elements of ownership, where the lessee (Churchs Chicken in this case) assumes some of the risks and rewards of ownership.
For a prospective franchisee, understanding the franchisor's lease obligations can provide insights into the financial stability and long-term commitments of Churchs Chicken. A significant amount of long-term lease liabilities might indicate substantial fixed costs for the company, which could impact its financial flexibility. Conversely, lower liabilities might suggest a more agile financial structure.
It's important to note that these liabilities reflect Churchs Chicken's obligations as a lessee. Franchisees should also consider their own potential lease obligations when setting up their individual units, as these will represent a significant ongoing expense. Reviewing the franchisor's financial statements and understanding their lease commitments can be a useful part of due diligence before investing in a Churchs Chicken franchise.