What was the net loss for Precision Door Service before income taxes in 2023?
Precision_Door_Service Franchise · 2025 FDDAnswer from 2025 FDD Document
orized, issued and outstanding | | | | Additional paid-in capital | 2,100,435 | 2,420,959 | | Accumulated deficit | (489,405) | (50,587) | | Accumulated other comprehensive loss | (42,956) | (51,483) | | Total stockholder's equity | 1,568,074 | 2,318,889 | | Total liabilities and stockholder's equity | $ 3,459,395 $ | 3,969,145 |
Consolidated Statements of Operations and Comprehensive Income (Loss) ($000's)
| For the years ended December 31, Revenues and income Franchise service fees Franchise sales fees | $ 2023 | 2022 |
|---|---|---|
| 194,731 $ | 176,281 | |
| 38,441 | 20,655 | |
| Sales of products and services | 288,146 | 263,318 |
| Advertising and promotional fund revenue | 53,320 | 50,870 |
| Other revenue | 39,026 | 38,056 |
| Total revenues and income | 613,664 | 549,180 |
| Cost of Sales | ||
| Products and services | 169,627 | 154,815 |
| Gross Profit | 444,037 | 394,365 |
| Selling expense | 26,179 | 21,506 |
| General and administrative expense | 196,985 | 172,713 |
| Advertising and promotional fund expense | 58,124 | 54,235 |
| Equity-based compensation expense | 4,194 | 3,414 |
| Depreciation and amortization | 116,929 | 104,943 |
| Management and board fees and expenses | 4,638 | 5,207 |
| Transaction costs | - | 3,067 |
| Loss on impairment of goodwill and tradenames | 428,286 | 51,454 |
| Bad debt expense | 2,812 | 2,398 |
| Operating loss | (394,110) | (24,572) |
| Other expenses | ||
| Interest expense | 68,756 | 45,552 |
| Total other expenses | 68,756 | 45,552 |
| Net loss before income taxes | (462,866) | (70,124) |
| Income tax |
Source: Item 21 — Financial Statements (FDD page 91)
What This Means (2025 FDD)
According to the 2025 FDD, Precision Door Service experienced a net loss before income taxes of $(462,866) in 2023. This figure indicates the company's financial performance before accounting for income tax benefits or expenses. In comparison, the net loss before income taxes for 2022 was $(70,124), showing a significant increase in net losses year over year.
For a prospective franchisee, this information is crucial as it provides insight into the financial health and stability of Precision Door Service. A substantial net loss before income taxes could raise concerns about the company's profitability and its ability to support its franchisees. It is important to note that this loss occurred before considering any income tax benefits, which could potentially offset some of the loss.
It is advisable for potential franchisees to further investigate the reasons behind the net loss and understand the strategies Precision Door Service has in place to improve its financial performance. This could involve reviewing the company's financial statements in detail, consulting with financial advisors, and asking the franchisor for clarification on the factors contributing to the loss and the plans for future profitability. Understanding the context and potential impact of these losses is essential for making an informed investment decision.