Did Craters & Freighters recognize any impairment loss on long-lived assets in 2022 or 2023?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company reviews their long-lived assets periodically to determine potential impairment by comparing the carrying value of those assets with the estimated future undiscounted cash flows expected to result from the use of the assets, including cash flows from disposition. Should the sum of the expected future undiscounted cash flows be less than the carrying value, the Company would recognize an impairment loss at that time. No impairment loss was recognized in 2023 and 2022.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters FDD, the company reviews its long-lived assets periodically to check for potential impairment. This involves comparing the carrying value of the assets with the estimated future undiscounted cash flows expected from their use, including any cash flows from disposition.
If the sum of these expected future undiscounted cash flows is less than the carrying value, Craters & Freighters would recognize an impairment loss at that time. However, for the years 2022 and 2023, Craters & Freighters did not recognize any impairment loss on its long-lived assets.
For a prospective franchisee, this indicates that Craters & Freighters's long-lived assets were not devalued during those years, suggesting stable asset performance and financial management. This could be a positive sign for potential investors, as it reflects the company's ability to maintain the value of its assets.