The Joint (US:JYNT)2025-05-08 22:02Financial Data and Key Metrics Changes - System wide sales for Q1 2025 were $132.6 million, up 5% compared to Q1 2024, indicating resilience in the current economic environment [10] - Revenue from continuing operations increased by 7% to $13.1 million compared to $12.2 million in Q1 2024 [29] - Adjusted EBITDA from continuing operations was $46,000, a significant decrease from $425,000 in Q1 2024 [10][29] - Net loss from continuing operations was $506,000, compared to a loss of $399,000 in Q1 2024 [30] Business Line Data and Key Metrics Changes - Comp sales for all clinics open for at least 13 months were up 3% for Q1 2025 and increased to 4% in March 2025 [10][24] - Comp sales for mature clinics (open for at least 48 months) were down 2% [24][82] - The company refranchised two corporate clinics and opened five franchise clinics during Q1 2025, with a total of 969 clinics, of which 847 (87%) are franchise clinics [25][26] Market Data and Key Metrics Changes - The company expects system wide sales for 2025 to be between $550 million and $570 million, compared to $530.3 million in 2024 [32] - Comp sales for clinics open for 13 months or more are expected to be in the mid-single digits for 2025 [32] Company Strategy and Development Direction - The company aims to become a pure play franchisor, with 93% of corporate clinics under Letters of Intent (LOIs) for refranchising [12][51] - The strategy includes dynamic revenue management, strengthening digital marketing, and enhancing patient-facing technology [12][19][22] - The company is focusing on pain-centric messaging to attract new patients, as 74% of new patients cite pain as a reason for visiting [35][39] Management's Comments on Operating Environment and Future Outlook - Management acknowledges a dynamic consumer environment and is closely monitoring the situation while pushing ahead with the transition plan [11] - The company anticipates a transformative financial impact as clinics shift from company-owned to franchise clinics, leading to increased franchise royalties and fees [34] - Economic headwinds, inflation, and volatile consumer sentiment are expected to impact the beginning of 2025, but the company remains optimistic about future profitability [34] Other Important Information - The company has welcomed new executives to enhance legal strategy and operations, aiming to improve clinic quality and economics [41] - The Joint has been recognized as one of the fastest-growing franchises and ranked in the Franchise 500 [41] Q&A Session Summary Question: New patient ad metrics and retention trends - Management noted that new patient volumes have been affected by overall consumer sentiment, but retention rates remain stable [44][46] Question: Metrics on profitability and overhead reduction - Management is not ready to provide specific metrics but expects profitability to improve as G&A expenses are reduced [47][49] Question: Timeline for refranchising process completion - Management intends to exit 2025 as a pure play franchisor and hopes to accelerate the refranchising process [51] Question: Comp sales performance and dynamics - Management did not disclose April comp sales but confirmed a return to 4% in March [57] - Franchise clinic comp performance mirrors consolidated comp, with corporate clinic comp trailing slightly [59] Question: Dynamic pricing opportunities - Management is exploring various pricing models, with potential for double-digit impacts on system wide sales [61] Question: Selling and marketing expenses normalization - Management expects selling and marketing expenses to normalize by Q3 2025 after a dual agency transition [68] Question: Strategies for mature clinics to improve comp sales - Management is implementing operational strategies and marketing tactics aimed at strengthening existing clinics [83][85]