What was the change in royalty and other receivables for Circle K for the year ended April 27, 2025?
Circle_K Franchise · 2025 FDDAnswer from 2025 FDD Document
$ | 88, 20 1, 000 | $ | ( 91, 667 564 ) , | $ 35, 316 368 , | $ 31, 849 814 , |
TMC FRANCHISE CORPORATION (a wholly owned subsidiary of Circle K Stores Inc.) CONSOLIDATED STATEMENTS OF CASH FLOWS
| Year Ended April 27, 2025 | Year Ended April 28, 2024 | Year Ended April 30, 2023 | |||
|---|---|---|---|---|---|
| Cash Flows from Operating Activities: | |||||
| Net income and comprehensive income | $ 19,088,215 | $ 15,286,241 | $ | 21,401,111 | |
| Adjustments to reconcile net income and comprehensive income to net cash | |||||
| provided by operating activities: | |||||
| Depreciation and amortization expense | 7,776,052 | 8,959,374 | 8,449,524 | ||
| Loss (Gain) on Disposals and Terminations | 7,610 | 1,541,825 | (38,139) | ||
| Amortization of notes receivable from franchisees and of other assets | 3,054,368 | 2,115,617 | 773,839 | ||
| Change in royalty and other receivables | (2,551,932) | 1,512,943 | 4,366,021 | ||
| Change in current liabilities | (3,059,613) | 3,268,261 | 919,930 | ||
| Change in deferred income taxes | (604,274) | 648,289 | (833,362) | ||
| Change in deferred revenue | (747,274) | (995,740) | (847,564) | ||
| Net Cash Provided by Operating Activities | 22,963,152 | 32,336,810 | 34,191,360 | ||
| Cash Flows from Investing Activities: | |||||
| Purchase of property and equipment and intangibles | (1,519,3 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 99–100)
What This Means (2025 FDD)
According to Circle K's 2025 Franchise Disclosure Document, the change in royalty and other receivables is detailed in the consolidated statements of cash flows. For the year ended April 27, 2025, there was a decrease of $2,551,932 in royalty and other receivables. In comparison, for the year ended April 28, 2024, there was an increase of $1,512,943.
This change reflects the difference between the amounts Circle K was owed in royalties and other payments at the beginning versus the end of the fiscal year. A negative change, as seen in 2025, indicates that Circle K collected more in receivables than it accrued during the year. This could be due to various factors such as improved collection efforts, changes in sales volume, or adjustments to royalty rates.
For a prospective Circle K franchisee, understanding these changes can provide insight into the financial health and operational efficiency of the franchise system. It's important to note that these figures represent the consolidated financial performance of TMC Franchise Corporation, a wholly-owned subsidiary of Circle K Stores Inc., and may not directly reflect the performance of an individual franchise location. Franchisees should inquire about the factors contributing to these changes and how they might impact their own business operations.
Furthermore, the FDD also provides the royalty and other receivables as an asset on the balance sheet. The royalty and other receivables were $11,184,013 as of April 27, 2025, and $8,632,081 as of April 28, 2024. This shows an increase in the amount of royalty and other receivables of $2,551,932 from 2024 to 2025. This increase from year to year on the balance sheet is reflected as a decrease in the change in royalty and other receivables on the statement of cash flows.