What was the accumulated deficit for Sonesta Simply Suites as of December 31, 2023?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
ified during the audit.
March 24, 2025
RED LION HOTELS CORPORATION CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except share data)
| December 31, | |||||
|---|---|---|---|---|---|
| 2024 | 2023 | ||||
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | $ | 13,316 | $ | 37,753 | |
| Accounts receivable, net | 9,258 | 7,259 | |||
| Notes receivable, net | 40 | 42 | |||
| Prepaid expenses and other current assets | 4,592 | 3,441 | |||
| Total current assets | 27,206 | 48,495 | |||
| Property and equipment, net | 1,178 | 816 | |||
| Intangible assets, net | 20,884 | 21,153 | |||
| Operating lease right of use assets | 1,686 | 2,131 | |||
| Goodwill | 19,680 | 19,680 | |||
| Other long term assets | 30,308 | 12,324 | |||
| Total assets | $ | 100,942 | $ | 104,599 | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | $ | 1,481 | $ | 1,915 | |
| Accrued compensation | 4,202 | 3,745 | |||
| Accrued expenses and other current liabilities | 868 | 1,631 | |||
| Operating lease liabilities | 581 | 595 | |||
| Total current liabilities | 7,132 | 7,886 | |||
| Long term liabilities: | |||||
| Operating lease liabilities, net of current portion | 1,218 | 1,680 | |||
| Due to related parties | 7,234 | 8,768 | |||
| Deferred income taxes | 235 | 235 | |||
| Loyalty program | 139 | - | |||
| Other long-term liabilities | 6,753 | 4,886 | |||
| Total long term liabilities | 15,579 | 15,569 | |||
| Total liabilities | 22,711 | 23,455 | |||
| Commitments and contingencies (Note 8) | |||||
| Shareholders' Equity: | |||||
| Common shares, $0.01 par value; |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, the accumulated deficit as of December 31, 2023, was ($6,763). This figure represents the cumulative losses that the company has incurred over its lifetime, which have not been offset by profits. An accumulated deficit is essentially the opposite of retained earnings.
For a prospective Sonesta Simply Suites franchisee, this number provides insight into the financial history of the company. While a deficit isn't necessarily a sign of imminent failure, it does suggest that the company has historically struggled to be profitable. It's important to consider this figure in conjunction with other financial metrics and trends to get a more complete picture of the company's financial health.
It is also important to note that the financial statements provided are for Red Lion Hotels Corporation (RLHC), the parent company of Sonesta Simply Suites. Therefore, the accumulated deficit reflects the overall financial performance of RLHC and its subsidiaries, not just the Sonesta Simply Suites brand. A potential franchisee should investigate how much of this deficit is attributable to Sonesta Simply Suites specifically. Reviewing the trend in accumulated deficit (or retained earnings) over several years can provide a better understanding of whether the company's financial performance is improving or declining.