What was the net loss for Nothing Bundt Cakes for the period ending December 25, 2022?
Nothing_Bundt_Cakes Franchise · 2025 FDDAnswer from 2025 FDD Document
81 | 91 | | Loss before income taxes | (16,017,649) | (23,851,928) | | Income tax expense | 157,563 | 129,342 | | Net loss | $ (16,175,212) $ | (23,981,270) |
Statements of Member's Equity
| Balance at December 26, 2021 | $ 950,138,512 |
|---|---|
| Net loss | (23,981,270) |
| Distributions | (26,645,995) |
| Balance at December 25, 2022 | $ 899,511,247 |
| Net loss | (16,175,212) |
| Distributions | (35,890,051) |
| Balance at December 31, 2023 | $ 847,445,984 |
Statements of Cash Flows
| 53-week period ended December 31, 2023 | 52-week period ended December 25, 2022 | |
|---|---|---|
| Cash flows from operating activities | ||
| Net loss | $ (16,175,212) $ | (23,981,270) |
| Adjustments to reconcile net loss to net cash provided by | ||
| operating activities: | ||
| Amortization of goodwill and intangible assets | 50,863,821 | 49,904,126 |
| Amortization of off-market agreement liability | (368,320) | (368,321) |
| Changes in assets and liabilities: | ||
| Accounts receivable | 527,800 | (145,044) |
| Prepaid expenses | (428,859) | (131,700) |
| Accounts payable | (14,000) | 14,00 |
Source: Item 23 — RECEIPTS (FDD pages 93–309)
What This Means (2025 FDD)
According to Nothing Bundt Cakes' 2025 Franchise Disclosure Document, for the 52-week period ending December 25, 2022, the company experienced a net loss of $23,981,270. This figure is part of the cash flow statement from operating activities.
This significant net loss indicates that Nothing Bundt Cakes' expenses and costs exceeded its revenues during this period. While not uncommon for businesses, especially during growth phases or in response to specific market conditions, prospective franchisees should carefully consider the factors contributing to this loss. Understanding the reasons behind the loss, such as investments in expansion, one-time expenses, or broader economic factors, is crucial for assessing the financial health and stability of the franchise system.
It's important to note that this loss is reconciled with other financial activities, such as amortization of goodwill and intangible assets ($49,904,126), amortization of off-market agreement liability ($-368,321), and changes in assets and liabilities, to arrive at the net cash provided by operating activities, which was $26,759,291 for the same period. This reconciliation provides a more comprehensive view of the company's cash flow situation, as it adjusts for non-cash expenses and changes in working capital.
Prospective franchisees should investigate the reasons for the net loss and how Nothing Bundt Cakes plans to address it. They should also analyze the cash flow from operating activities to understand the company's ability to generate cash from its core business operations, as this can impact the long-term viability and success of both the franchisor and its franchisees.