Income Statement and Balance Sheet

KRISPY KREME DOUGHNUTS, INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

Year Ended Feb. 1, 2015 (In thousands, except per share amounts)

Revenues $ 383,984

Operating expenses:

Direct operating expenses (exclusive of depreciation and amortization

shown below) 345,007

General and administrative expenses 23,458

Depreciation and amortization expense 8,709

Impairment charges and lease termination costs 548

Settlement of litigation (14,930 )

Other operating (income) and expense, net 1,501

Operating income (loss) 4,761

Interest income 331

Interest expense (10,679 )

Loss on extinguishment of debt

Equity in losses of equity method franchisees (786 )

Other non-operating income and (expense), net 2,815

Loss before income taxes (3,558 )

Provision for income taxes 503

Net loss $ (4,061 )

KRISPY KREME DOUGHNUTS, INC.

CONSOLIDATED BALANCE SHEET

Feb. 1, 2015 (In thousands)

ASSETS

CURRENT ASSETS:

Cash and cash equivalents $ 35,538

Receivables 19,229

Accounts and notes receivable equity method franchisees 1,019

Inventories 15,587

Deferred income taxes 106

Other current assets 4,327

Total current assets 75,806

Property and equipment 85,075

Investments in equity method franchisees 1,187

Goodwill and other intangible assets 23,856

Other assets 9,002

Total assets $ 194,926

LIABILITIES AND SHAREHOLDERS EQUITY

CURRENT LIABILITIES:

Current maturities of long-term debt $ 1,413

Accounts payable 8,981

Accrued liabilities 29,222

Total current liabilities 39,616

Long-term debt, less current maturities 73,454

Deferred income taxes 106

Other long-term obligations 23,995

Commitments and contingencies

SHAREHOLDERS EQUITY:

Preferred stock, no par value; 10,000 shares authorized; none issued and outstanding---common stock, no par value, 300,000 shares authorized; 67,512 and 65,370 shares issued and outstanding 361,801

Accumulated other comprehensive income (loss) (913 )

Accumulated deficit (303,133 )

Total shareholders equity 57,755

Total liabilities and shareholders equity $ 194,926

9. Analysis: Please analyze the information presented above and discuss what conclusions you can draw from this information.