What was the total amount of Cinnabon's long-term deferred revenue as of December 31, 2023?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
nting estimates made by management, as well as evaluate the overall presentation of the consolidated financial statements.
- Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.
Atlanta, Georgia March 21, 2025
Consolidated balance sheets
| December 29, 2024 | December 31, 2023 | |
|---|---|---|
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | $ 620 | $ 403 |
| Restricted cash - securitization | 5,725 | 7,052 |
| Accounts receivable, net of allowance for credit losses of | ||
| $1,695 and $1,136 in 2024 and 2023, respectively | 33,548 | 26,793 |
| Prepaid expenses and other current assets | 5 | 5 |
| Total current assets | 39,898 | 34,253 |
| Assets held for lease, net | 261 | 362 |
| Intangible assets, net | 306,188 | 306,299 |
| Total assets | $ 346,347 | $ 340,914 |
| Liabilities and Member's Equity | ||
| Current liabilities: | ||
| Accrued expenses and other liabilities | $ 4,186 | $ 3,517 |
| Current portion of deferred revenue | 3,346 | 2,827 |
| Intercompany payables | 3,011 | 4,827 |
| Total current liabilities | 10,543 | 11,171 |
| Long-term deferred revenue | 50,042 | 46,288 |
| Long-term other liabilities | 124 | 125 |
| Total liabilities | 60,709 | 57,584 |
| Commitments and contingencies (see Note 7) |
Source: Item 23 — Receipts (FDD pages 114–399)
What This Means (2025 FDD)
According to Cinnabon's 2025 Franchise Disclosure Document, the company's total long-term deferred revenue as of December 31, 2023, was $46,288. This figure represents revenues that Cinnabon has received but not yet recognized as earned, and it is classified as a long-term liability on their balance sheet.
For a prospective Cinnabon franchisee, understanding deferred revenue is crucial because it reflects the company's financial obligations and future revenue recognition. This deferred revenue primarily arises from franchise fees and other payments received upfront from franchisees, which are then recognized over the term of the franchise agreement as Cinnabon provides ongoing support and services.
The fact that Cinnabon holds a significant amount in long-term deferred revenue indicates a steady stream of future revenue. However, franchisees should also consider the potential risks associated with deferred revenue, such as changes in accounting standards or unforeseen circumstances that could impact the timing of revenue recognition. Reviewing these figures in the context of Cinnabon's overall financial health provides a more complete picture for potential investors.