Individual Case Analysis Paper - Boston Chicken Questions

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bostonchickenfinancials.xls
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Income Statement

Income Statement
Year ended December 26 1994 1993 1992
Revenue
Royalties & franchise-related fees $55,235 $12,681 $2,627
Company-operated stores 40,916 29,849 5,656
Total revenues 96,151 42,530 8,283
Costs and expenses
Cost of products sold 15,876 11,287 2,241
Salaries and benefit 22,637 15,437 7,110
General and administrative 27,930 13,879 5,241
Provision for relocation 5,097
Total costs and expenses 71,540 40,603 14,592
Income (loss) from operations 24,611 1,927 (6,309)
Other income (expense)
Interest income (expense), net (4,235) (440) 270
Other income, net 74 160 189
Total other income (expense) (4,161) (280) 459
Income (loss) before income taxes 20,450 1,647 (5,850)
Income taxes 4,277
Net income (loss) $16,173 $1,647 ($5,850)
Net income (loss) per share common and equivalent share $0.38 $0.06 ($0.21)
Number of shares 42,861 32,667 28,495

Balance Sheet

Balance Sheet
Year ended December 26 1994 1993 1992
Assets
Current assets
Cash $25,304 $4,537 $9,709
Accounts receivable, net 6,540 2,076 564
Inventory NA NA 235
Due from affiliates 6,462 3,126
Notes receivable 16,906 1,512 83
Prepaid expenses & other current assets 2,282 1,843 425
Deferred income taxes 1,835
Total current assets 59,329 13,094 11,016
Property & equipment, net 163,314 51,331 9,934
Notes receivable 185,594 44,204
Deferred financing costs 8,346 358
Other assets 10,399 1,077 1,720
Total assets $426,982 $110,064 $22,670
Liabilities & Stockholders’ Equity
Current liabilities
Accounts payable $15,188 $6,216 $1,383
Accrued expenses 6,587 1,835 835
Deferred franchise revenue 5,505 2,255 981
Total current liabilities 27,280 10,306 3,199
Deferred franchise revenue 5,815 3,139 1,177
Convertible subordinated debt 130,000
Other noncurrent liabilities 1,061 1,713 1,257
Deferred income taxes 3,011
Stockholders’ Equity
Common stock 447 347 112
Additional paid-in capital 252,298 103,662 27,675
Retained earnings (deficit) 7,070 (9,103) (10,750)
259,815 94,906 17,037
Total liabilities and stockholders’ equity $426,982 $110,064 $22,670

CF Statement

Cash Flow Statement
Year ended December 26 1994 1993 1992
Cash from operating activities
Net income (loss) $16,173 $1,647 ($5,850)
Adjustments to reconcile income (loss) to net cash provided by (used in) operating activities
Depreciation and amortization 6,074 1,970 260
Deferred income taxes 4,277
Vesting of common stock for services rendered 39
Gain on disposal of assets (368) (150) (29)
Changes in assets and liabilities
Accounts receivable and due from affiliates (7,800) (4,343) (689)
Accounts payable and accrued expenses 13,724 6,247 1,102
Deferred franchise revenue 5,926 3,236 1,223
Other assets and liabilities (2,088) (561) 332
Net cash from (used) in operations 35,198 8,046 (3,612)
Cash from investing activities
Purchase of plant, property & equipment (163,622) (49,151) (8,453)
Proceeds from sale of assets 62,342 6,161 385
Acquisition of other assets (12,790) (1,093) (273)
Issuance of notes receivable (225,282) (45,690) (773)
Repayment of notes receivable 68,498 747
Net cash used in investing activities (270,854) (89,026) (9,114)
Cash from financing activities
Proceeds from issue common stock 125,703 66,150 19,843
Proceeds from convertible subordinate notes 130,000 9,658
Borrowings under credit facility 96,130 32,275
Repayments under credit facility (96130) (32275)
Payment of capital lease obligation (300)
Net cash from financing activities 255,703 75,808 19,543
Net increase (decrease) in cash 20,767 (5172) 6,817
Cash, beginning of year 4,537 9,709 2,892
Cash, end of year $25,304 $4,537 $9,709
Supplemental cash flow information
Interest paid $3,395 $226 $29
Noncash transactions
Conversion of convt. subord. notes into common stock $ $10,072 $
Issuance of commons stock for assets $19,931 $