What was the total revenue for Even Hotels 'Fee business' in the revised year 1?
Even_Hotels Franchise · 2025 FDDAnswer from 2025 FDD Document
y, no such opinion is expressed.
- x Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the consolidated financial statements.
- x 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 governa
Source: Item 23 — RECEIPTS (FDD pages 99–438)
What This Means (2025 FDD)
According to Even Hotels' 2025 Franchise Disclosure Document, the total revenue from 'Fee business' for the year ended December 31, 2023 (referred to as 'Revised ¹') was $869,949. This figure represents the income Even Hotels generated from franchising and related activities, as opposed to revenue from hotel operations or other sources. This number is important for prospective franchisees to understand the revenue streams of Even Hotels.
'Fee business' revenue is generated through franchising hotels and resorts under brands like Crowne Plaza, Holiday Inn, and Even Hotels. The revenue comes from providing licenses to use the company's trademarks and intellectual property. Franchise royalty fees are a percentage of the hotel's gross room revenues. These fees are treated as variable consideration and are recognized as the underlying hotel revenues occur. The 'Fee business' revenue also includes any liquidated damage settlements from franchisees who terminate their agreements early.
In addition to royalty fees, Even Hotels also collects application and re-licensing fees, which are recognized over the life of the franchise contract. The FDD also mentions 'key money,' which are amounts paid to hotel owners to secure management and franchise agreements. These payments are treated as consideration payable to a customer and are recorded as a contract asset, which is then recognized as a deduction to fee business revenue over the initial term of the agreement. For the year in question, $22.1 million was recognized in revenue related to key money.
Understanding the components of the 'Fee business' revenue can help a potential Even Hotels franchisee assess the financial stability and revenue-generating activities of the franchisor. It's important to note that these figures are based on past performance and may not be indicative of future results. Prospective franchisees should conduct their own due diligence and consult with financial advisors to fully understand the financial implications of investing in an Even Hotels franchise.