What was the gross carrying amount of Hardees' franchise agreements in 2023?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
----|-----------| | Net working capital | $ | 55 | | Property and equipment | | 12,281 | | Operating lease assets | | 5,048 | | Reacquired franchise rights | | 1,810 | | Operating leases | | (5,048) | | Finance leases | | (10,708) | | Net assets acquired and liabilities assumed | $ | 3,438 |
The resulting acquisitions result in no goodwill.
Refranchising Transaction
During fiscal 2024, CKE Restaurants sold one Hardee's restaurant and certain related inventory and fixed assets with a net book value of $1,265. In connection with the sale of this restaurant, we received aggregate consideration of $2,082, and recognized a net gain of $817, which is included in facility action charges, net, in our accompanying Combined Consolidated Statements of Income. In connection with the refranchising transaction, the franchisee acquired real property and equipment related to the rest
Source: Item 21 — Financial Statements (FDD pages 84–85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, the gross carrying amount of franchise agreements in 2023 was $319,855. This figure represents the initial cost or value of the franchise agreements that Hardees holds. These agreements provide franchisees the right to operate a Hardees restaurant under the company's brand and system.
The franchise agreements have a weighted-average life of 20 years, meaning Hardees amortizes the value of these agreements over that period. The accumulated amortization for franchise agreements in 2023 was $143,300, which reflects the amount of the initial value that has already been recognized as an expense. The net carrying amount, which is the gross carrying amount less accumulated amortization, was $176,555 in 2023.
For a prospective Hardees franchisee, understanding these figures provides insight into how Hardees values its franchise agreements and manages its intangible assets. The gross carrying amount is not directly paid by the franchisee, but it reflects the overall value Hardees places on its franchise system. Monitoring these values and their amortization can help franchisees understand the financial management and long-term planning within the Hardees organization.