What was the net income (loss) for Remax in 2023?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
uity-based compensation | 24,761 | — | 24,761 | | Payroll taxes related to net settled restricted stock units | (6,415) | — | (6,415) | | Member distributions | (78,393) | — | (78,393) | | Other | (146) | — | (146) | | Balances, December 31, 2022 | $ 3,685 | $ (1,609) | $ 2,076 | | Net income (loss) | (61,229) | — | (61,229) | | Change in accumulated other comprehensive income (loss) | — | 1,148 | 1,148 | | Member contribution of equity-based compensation | 17,018 | — | 17,018 | | Payroll taxes related to net settled restricted stock units | (4,273) | — | (4,273) | | Member distributions | (33,565) | — | (33,565) | | Other | (240) | — | (240) | | Balances, December 31, 2023 | $ (78,604) | $ (461) | $ (79,065) | | Net income | 11,293 | — | 11,293 | | Change in accumulated other comprehensive income (loss) | — | (4,213) | (4,213) | | Member contribution of equity-based compensation | 15,563 | — | 15,563 | | Payroll taxes related to net settled restricted stock units | (2,988) | — | (2,988) | | Member distributions | (8,450) | — | (8,450) | | Other | 87 | — | 87 | | Balances, December 31, 2024 | $ (63,099) | $ (4,674) | $ (67,773) |
(A Wholly Owned Subsidiary of RMCO, LLC) Consolidated Statements of Cash Flows (in thousands)
| Year Ended December 31, | |||||
|---|---|---|---|---|---|
| 2024 | 2023 | 2022 | |||
| Cash flows from operating activities: | |||||
| Net income (loss) | $ | 11,293 | $ | (61,229) | $ 20,714 |
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||
| Depreciation and amortization | 29,551 | 32,387 | 35,742 | ||
| Equity-based compensation expense | 17,553 | 18,106 | 20,915 | ||
| Bad debt expense | 1,359 | 6,784 | 2,518 | ||
| Deferred income tax expense (benefit) | (2,102) | (1,571) | (1,690) | ||
| Fair value adjustments to contingent consideration | (225) | (533) | (133) | ||
| Settlement charge | 5,483 | 55,150 | — | ||
| Impairment charge - goodwill | — | 18,633 | 7,100 | ||
| Impairment charge - leased assets | — | — | 6,248 | ||
| Loss (gain) on sale or disposition of assets, net | 190 | 406 | 1,320 | ||
| Non-cash lease benefit | (2,928) | (2,847) | (2,108) | ||
| Non-cash loss on lease termination | — | — | 1,175 | ||
| Non-cash debt charges | 863 | 860 | 861 | ||
| Payment of contingent consideration in excess of acquisition date fair value | (360) | — | — | ||
| Other, net | (218) | 38 | 49 | ||
| Changes in operating assets and liabilities | |||||
| Accounts and notes receivable, current portion | 8,324 | (8,778) | 2,834 | ||
| Other current and noncurrent assets | 712 | 6,462 | 5,819 | ||
| Other current and noncurrent liabilities | 1,526 | (19,338) | (17,906) | ||
| Income taxes receivable/payable | 92 | (1,078) | (464) | ||
| Deferred revenue, current and noncurrent | (2,870) | (5,432) | 58 | ||
| Net cash provided by operating activities | 68,243 | 38,020 | 83,052 | ||
| Cash flows from investing activities: | |||||
| Purchases of property, equipment and capitalization of software |
Source: Item 22 — Contracts (FDD pages 108–334)
What This Means (2025 FDD)
According to Remax's 2025 Franchise Disclosure Document, the net loss for the year ended December 31, 2023, was $(61,229). This figure represents the company's financial performance, reflecting the difference between total revenues and total expenses, including factors like operating costs, interest, and taxes.
For a prospective franchisee, this net loss indicates that Remax's expenses exceeded its revenues during that period. While a single year's loss doesn't necessarily signal long-term instability, it is a point to consider. It's important to investigate the reasons behind the loss, such as increased operating expenses, decreased revenue, or specific one-time charges like settlement and impairment charges, which totaled $73,783 in 2023.
Understanding the context of this loss is crucial. For instance, the FDD reveals that Remax experienced significant settlement and impairment charges in 2023. A potential franchisee should inquire about the nature of these charges and whether they are likely to recur. Additionally, examining Remax's revenue streams, including continuing franchise fees, annual dues, and broker fees, can provide insights into the company's overall financial health and stability. Comparing the 2023 figures with those of 2022 and 2024 can also help assess whether the loss was an isolated event or part of a trend.
Ultimately, a prospective franchisee should conduct thorough due diligence, including consulting with a financial advisor, to evaluate the financial implications of this net loss and its potential impact on their investment in a Remax franchise.