What was the net cash used in operating activities for Kidokinetics in 2021?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
23, 2022, and 2021
| 2023 | 2022 | 2021 | |
|---|---|---|---|
| Cash flow from operating activities: | |||
| Net loss | $ (749,072) | $ (811,320) | $ (411,716) |
| Adjustments to reconcile net loss to | |||
| net cash used in operating activities: | |||
| Amortization | 25,446 | 22,001 | 11,191 |
| Depreciation | 11,400 | 11,400 | 1,900 |
| Amortization of right of use asset | 56,494 | 53,741 | - |
| Changes in operating assets and liabilities: | |||
| Accounts receivable | (446,453) | (498) | 2,530 |
| Deferred contract costs | (905,048) | (608,934) | - |
| Other non-current assets | - | - | (9,600) |
| Accounts payable | 394,700 | 285,300 | 60,075 |
| Accrued expenses | 97,201 | 41,609 | - |
| Credit card liability | (47,346) | 158,575 | 47,806 |
| Loans from shareholder | 3,347 | 1,498 | 18,226 |
| Operating lease liability | (57,509) | (53,016) | - |
| Deferred revenue | 1,465,557 | 884,778 | - |
| Net cash used in operating activities | (151,283) | (14,866) | (279,588) |
| Cash flows from investing activities: | |||
| Investment in leasehold improvements | - | (4,440) | (56,987) |
| Investment in intangible assets | - | (29,000) | (47,200) |
| Net cash used in investing activities | - | (33,440) | (104,187) |
| Cash flows from financing activities: | |||
| Draw on note payable | 30,000 | 76,050 | - |
| Net draws on lines of credit | 243,821 | - | - |
| Principal payments on note payable | (60,941) | (15,109) | - |
| Member contributions (distributions) | (17,133) | (20,691) | 422,077 |
| Net cash provided by financing activities | 195,747 | 40,250 | 422,077 |
| Net change in cash and cash equivalents | 44,464 | (8,056) | 38,302 |
| Cash at the beginning of the year | 32,500 | 40,556 | 2,254 |
| Cash at the end of the year | $ 76,964 | $ 32,500 | $ 40,556 |
| Supplementary disclosures of cash flows | |||
| Cash paid for interest | $ 97,922 | $ 25,021 | $ 1,943 |
| Cash paid for taxes |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, the net cash used in operating activities in 2021 was $(279,588). This figure indicates the total cash outflow resulting from the company's core business operations during that year. It reflects the difference between the cash generated from sales, services, and other operating revenue, and the cash spent on expenses such as salaries, rent, inventory, and other day-to-day costs.
A negative value, such as the $(279,588) reported for 2021, suggests that Kidokinetics's operating activities consumed more cash than they generated. This could be due to various factors, including net losses, increases in accounts receivable, or changes in accounts payable.
Prospective franchisees should carefully examine the factors contributing to this negative cash flow, as it could signal potential challenges in the company's operational efficiency or profitability. It's important to compare this figure with those of previous years and industry benchmarks to assess the company's financial health and sustainability. Understanding the reasons behind the cash usage can help franchisees make informed decisions about their investment and operational strategies.