What was the net loss for City Publications during the year ended December 31, 2022?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
ANCE, DECEMBER 31, 2023 | 1,000 | | 17,000 | (1,849,093) | 1,745,483 | (85,610) | | | | | | | Advances from (to) affiliates | - | | - | (145,012) | - | (145,012) | | | | | | | Capital (distributions) | - | | - | - | (107,323) | (107,323) | | | | | | | Net income | - | | - | - | 263,947 | 263,947 | | | | | | | BALANCE, DECEMBER 31, 2024 | $ 1,000 | $ | 17,000 | $ (1,994,105) | $ 1,902,107 | $ (73,998) | | | | | |
CITY PUBLICATIONS FRANCHISE GROUP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS
| FOR THE YEARS ENDED DECEMBER 31, | |||||||
|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2022 | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||
| Net (loss) income | $ | 263,947 | $ | 99,503 | $ | (13,838) | |
| Adjustments to reconcile net income to net | |||||||
| cash provided by operating activities: | |||||||
| Depreciation expense | 3,000 | 3,000 | 3,000 | ||||
| Recognition of non-refundable deferred franchise fees | (34,253) | (22,373) | (16,313) | ||||
| Changes in assets and liabilities: | |||||||
| Accounts receivable | 4,018 | (10,184) | 36,271 | ||||
| Other assets | - | 38 | - | ||||
| Accounts payable | 393,943 | (22,064) | (7,299) | ||||
| Non-refundable deferred franchise fees | 59,400 | 30,300 | 23,365 | ||||
| Net cash provided by operating activities | 690,055 | 78,220 | 25,186 | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | |||||||
| Purchase of property and equipment | (2,179) | - | - | ||||
| Net cash (used) by investing activities | (2,179) | - | - | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||||
| Advances to affiliates | (145,012) | (67,140) | (50,894) | ||||
| C |
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, the company experienced a net loss of $13,838 for the year ended December 31, 2022. This figure is derived from the Consolidated Statements of Changes in Shareholders' (Deficit), which provides a detailed overview of the financial transactions affecting the company's equity.
For a prospective franchisee, understanding the franchisor's financial health is crucial. A net loss indicates that the company's expenses exceeded its revenues during that period. While a single year's loss doesn't necessarily signal long-term instability, it's important to consider the context. Was this loss an anomaly, or part of a trend? What were the contributing factors?
It is also important to note that City Publications provided management and advertising services to its affiliate HHCI, LLC, and advanced funds to support affiliate operations. These related-party transactions can influence the financial statements and should be carefully reviewed to understand their impact on the company's overall financial position. Reviewing these transactions can provide a more comprehensive understanding of the company's financial performance and stability.
Franchisees should investigate the reasons behind the loss, the company's plans to address it, and its overall financial strategy. This information can help potential franchisees assess the risks and opportunities associated with investing in a City Publications franchise.