Press Releases

The Joint Corp. Reports First Quarter Financial Results

- Increases Annual System-Wide Gross Sales 32%, Compared to First Quarter 2017 -
- Grows Revenue 29%, Compared to First Quarter 2017 -
-  Improves Net Loss by $1.4 Million, Compared to First Quarter 2017 -
- Posts Third Consecutive Quarter of Positive Adjusted EBITDA -

SCOTTSDALE, Ariz., May 10, 2018 (GLOBE NEWSWIRE) -- The Joint Corp. (NASDAQ:JYNT), a national operator, manager and franchisor of chiropractic clinics, reported financial results for the three months ended March 31, 2018.    

First Quarter Highlights: 2018 Compared to 2017

  • Increased gross system-wide sales 32%, to $37.0 million.
  • Grew system-wide comp sales1 26%.
  • Increased revenue 29% to $7.1 million.
  • Improved net loss $1.4 million to $(387,000).
  • Posted positive Adjusted EBITDA of $156,000, an improvement of $753,000 from the first quarter of 2017.
  • Achieved positive Adjusted EBITDA for the third consecutive quarter.
  • Opened 7 new franchised clinics and no clinics closed, increasing total clinics to 406 as of
    March 31, 2018.
  • Reinitiated the corporate owned or managed clinic growth program with the acquisition of one previously-franchised clinic in April 2018.

Peter D. Holt, president and chief executive officer of The Joint Corp, said, “Our disciplined business strategy, improved operations and enhanced marketing together drove another quarter of strong growth. Additionally, the time for reaching the break-even point for new clinics continues to decrease. 

“We are proud to contribute to our patients’ well-being and will continue our pursuit to deliver quality, convenient and affordable chiropractic care. Many industry studies indicate the number of people experiencing pain and actively looking for drug-free management is increasing. We are perfectly positioned to meet this increasing demand. By broadening our footprint through accelerating our franchise sales, expanding our regional developer program and adding corporate owned or managed clinics in a strategic and measured fashion, we expect to continue to deliver shareholder value.”

First Quarter Financial Results: 2018 Compared to 2017

Revenue grew 29% to $7.1 million, compared to $5.5 million in the first quarter of 2017, due primarily to increased sales at company owned or managed clinics and a greater number of franchised clinics.

Cost of revenue was $1.0 million, up 40% compared to the first quarter of 2017, due to higher regional developer royalties from increased gross sales in regional developer territories.

Gross profit was $6.1 million dollars, increasing 27% from $4.8 million in the first quarter of 2017.

Selling and marketing expenses were $1.1 million, up from $1.0 million in the first quarter of 2017, reflecting higher marketing expenses related to our company owned or managed clinics. General and administrative expenses were $5.1 million, up 11% compared to the first quarter of 2017 due to increased payroll, which was partially offset by lower depreciation and amortization expenses.

Net loss was $(387,000), or $(0.03) per share. First quarter of 2017 net loss, including a charge of $418,000 related to the disposition/impairment of non-operating leases, was $(1.8) million, or $(0.14) per share.

Adjusted EBITDA income was $156,000, an improvement of $753,000, compared to Adjusted EBITDA loss of $(597,000) in the same quarter last year.  The company defines Adjusted EBITDA, a non-GAAP measure, as EBITDA before acquisition-related expenses, bargain purchase gain, loss on disposition or impairment, and stock-based compensation expenses. The company defines EBITDA as net income (loss) before net interest, tax expense, depreciation, and amortization expenses.

Balance Sheet Liquidity

Cash and cash equivalents were $4.0 million at March 31, 2018, compared to $4.2 million at December 31, 2017.  Pursuant to the terms of the Company’s credit agreement, during the first quarter of 2017, the Company borrowed a required $1.0 million on its line of credit, which remains unused as part of cash and cash equivalents on the balance sheet as of March 31, 2018.

2018 Financial Guidance

Management reiterates its full year 2018 financial guidance and franchise opening expectations as set forth below:

  • Revenue is expected to be between $31 million and $32 million, up from $25.0 million in 2017.
  • Adjusted EBITDA is expected to range between $2.5 million and $3.5 million, improving from an Adjusted EBITDA loss of $(214,000) in 2017.
  • Total new clinic openings are expected to be in the range of 40 to 52 including 40 to 50 new franchised clinics, up to two corporate-owned or managed greenfield clinics and up to three purchases of previously-franchised clinics, which when acquired from franchisees do not change the total clinic count.

Conference Call

The Joint Corp. management will host a conference call at 5 p.m. ET on Thursday, May 10, 2018, to discuss the first quarter 2018 results. The conference call may be accessed by dialing 765-507-2604 or 844-464-3931, and referencing conference code 1394097. A live webcast of the conference call will also be available on the investor relations section of the company’s website at An audio replay will be available two hours after the conclusion of the call through May 17, 2018. The replay can be accessed by dialing 404-537-3406 or 855-859-2056. The passcode for the replay is 1394097.

Non-GAAP Financial Information

This earnings release includes a presentation of EBITDA and Adjusted EBITDA which are non-GAAP financial measures. These are presented because they are important measures used by management to assess financial performance, as management believes they provide a more transparent view of the Company’s underlying operating performance and operating trends. Reconciliation of net loss to EBITDA and Adjusted EBITDA is presented in the table below. The Company defines Adjusted EBITDA as EBITDA before acquisition-related expenses, bargain purchase gain, loss on disposition or impairment, and stock-based compensation expenses. The Company defines EBITDA as net income (loss) before net interest, tax expense, depreciation, and amortization expenses.

EBITDA and Adjusted EBITDA do not represent and should not be considered alternatives to net income or cash flows from operations, as determined by accounting principles generally accepted in the United States, or GAAP. While EBITDA and Adjusted EBITDA are used as measures of financial performance and the ability to meet debt service requirements, they are not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the methods of calculation. EBITDA and Adjusted EBITDA should be reviewed in conjunction with the Company’s financial statements filed with the United States Securities and Exchange Commission (“SEC”).

Forward-Looking Statements

This press release contains statements about future events and expectations that constitute forward-looking statements. Forward-looking statements are based on our beliefs, assumptions and expectations of industry trends, our future financial and operating performance and our growth plans, taking into account the information currently available to us. These statements are not statements of historical fact. Forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from the expectations of future results we express or imply in any forward-looking statements and you should not place undue reliance on such statements. Factors that could contribute to these differences include, but are not limited to, our failure to develop or acquire corporate clinics as rapidly as we intend, our failure to profitably operate corporate clinics, and the factors described in “Risk Factors” in our Annual Reports on Form 10-K as filed with the SEC for the year ended December 31, 2017.  Words such as, "anticipates," "believes," "continues," "estimates," "expects," "goal," "objectives," "intends," "may," "opportunity," "plans," "potential," "near-term," "long-term," "projections," "assumptions," "projects," "guidance," "forecasts," "outlook," "target," "trends," "should," "could," "would," "will," and similar expressions are intended to identify such forward-looking statements. We qualify any forward-looking statements entirely by these cautionary factors. We assume no obligation to update or revise any forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.

About The Joint Corp. (NASDAQ:JYNT)

Based in Scottsdale, Arizona, The Joint is an emerging growth company that is reinventing chiropractic by making quality care convenient and affordable for patients seeking pain relief and ongoing wellness. Its no-appointment policy and convenient hours and locations make care more accessible, and affordable membership plans and packages eliminate the need for insurance. With over 400 clinics nationwide and nearly 5 million patient visits annually, The Joint is a key leader in the chiropractic profession. For more information, visit or follow the brand on Twitter, Facebook, YouTube and LinkedIn.

Business Structure

The Joint Corp. is a franchisor of clinics and an operator of clinics in certain states. In Arkansas, California, Colorado, Florida, Illinois, Kansas, Minnesota, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Tennessee and Washington, The Joint and its franchisees provide management services to affiliated professional chiropractic practices.

Media Contact: Molly Hottle, The Joint Corp., [email protected]
Investor Contact: Kirsten Chapman, LHA Investor Relations, 415-433-3777, [email protected]

      March 31,   December 31,
        2018       2017  
ASSETS     (unaudited)   (as adjusted)
Current assets:          
Cash and cash equivalents     $ 4,033,730     $ 4,216,221  
Restricted cash       134,189       103,819  
Accounts receivable, net       1,047,540       1,138,380  
Income taxes receivable       -       -  
Notes receivable - current portion       176,262       171,928  
Deferred franchise costs - current portion       522,123       498,433  
Prepaid expenses and other current assets       733,502       542,342  
Total current assets       6,647,346       6,671,123  
Property and equipment, net       3,719,459       3,800,466  
Notes receivable, net of current portion and reserve       306,132       351,857  
Deferred franchise costs, net of current portion       2,422,698       2,312,837  
Intangible assets, net       1,636,978       1,760,042  
Goodwill       2,916,426       2,916,426  
Deposits and other assets       594,213       611,808  
Total assets     $ 18,243,252     $ 18,424,559  
Current liabilities:          
Accounts payable     $ 935,658     $ 1,068,668  
Accrued expenses       197,812       86,959  
Co-op funds liability       134,189       89,681  
Payroll liabilities       846,919       867,430  
Notes payable - current portion       100,000       100,000  
Deferred rent - current portion       173,010       152,198  
Deferred franchise revenue - current portion       1,986,524       1,994,182  
Deferred revenue from company clinics       905,625       867,804  
Other current liabilities       388,354       72,534  
Total current liabilities       5,668,091       5,299,456  
Notes payable, net of current portion       1,000,000       1,000,000  
Deferred rent, net of current portion       750,010       802,492  
Deferred franchise revenue, net of current portion       9,602,898       9,560,242  
Deferred tax liability       57,191       136,434  
Other liabilities       106,562       411,497  
Total liabilities       17,184,752       17,210,121  
Commitments and contingencies          
Stockholders' equity:          
Series A preferred stock, $0.001 par value; 50,000          
shares authorized, 0 issued and outstanding, as of March 31, 2018,          
and  December 31, 2017       -       -  
Common stock, $0.001 par value; 20,000,000 shares          
authorized, 13,607,838 shares issued and 13,593,754 shares outstanding          
as of March 31, 2018 and 13,600,338 shares issued and 13,586,254          
outstanding as of December 31, 2017       13,607       13,600  
Additional paid-in capital       37,460,828       37,229,869  
Treasury stock 14,084 shares as of March 31, 2018 and          
December 31, 2017, at cost       (86,045 )     (86,045 )
Accumulated deficit       (36,329,890 )     (35,942,986 )
Total stockholders' equity       1,058,500       1,214,438  
Total liabilities and stockholders' equity     $ 18,243,252     $ 18,424,559  

    Three Months Ended
    March 31,
      2018       2017  
Revenues:        (as adjusted) 
Revenues and management fees from company clinics   $ 3,256,624     $ 2,496,334  
Royalty fees     2,273,988       1,706,073  
Franchise fees     348,337       295,540  
Advertising fund revenue     659,030       598,436  
Software fees     307,475       267,013  
Regional developer fees     135,011       64,146  
Other revenues     117,450       79,605  
Total revenues     7,097,915       5,507,147  
Cost of revenues:        
Franchise cost of revenues     872,768       634,855  
IT cost of revenues     99,564       58,861  
Total cost of revenues     972,332       693,716  
Selling and marketing expenses     1,102,304       958,706  
Depreciation and amortization     387,417       577,987  
General and administrative expenses     5,074,927       4,564,078  
Total selling, general and administrative expenses     6,564,648       6,100,771  
Loss on disposition or impairment     -       417,971  
Loss from operations     (439,065 )     (1,705,311 )
Other (expense) income, net     (11,194 )     (19,465 )
Loss before income tax expense     (450,259 )     (1,724,776 )
Income tax benefit (expense)     63,355       (40,609 )
Net loss and comprehensive loss   $ (386,904 )   $ (1,765,385 )
Loss per share:        
Basic and diluted loss per share   $ (0.03 )   $ (0.14 )
Basic and diluted weighted average shares     13,587,837       13,042,595  
Non-GAAP Financial Data:        
Net loss   $ (386,904 )   $ (1,765,385 )
Net Interest     11,194       23,820  
Depreciation and amortization expense     387,417       577,987  
Tax (benefit) expense     (63,355 )     40,609  
EBITDA   $ (51,648 )   $ (1,122,969 )
Stock compensation expense     207,641       95,065  
Acquisition related expenses     -       12,650  
Loss on disposition or impairment     -       417,971  
Bargain purchase gain     -       -  
Adjusted EBITDA   $ 155,993     $ (597,283 )

    Three Months Ended
    March 31,
      2018       2017  
        (as adjusted)
Net loss   $ (386,904 )   $ (1,765,385 )
Adjustments to reconcile net loss to net cash     516,203       1,127,243  
Changes in operating assets and liabilities     (162,402 )     (640,418 )
Net cash used in operating activities     (33,103 )     (1,278,560 )
Net cash used in investing activities     (142,343 )     (29,317 )
Net cash provided by financing activities     23,325       952,777  
Net decrease in cash, cash equivalents and restricted cash   $ (152,121 )   $ (355,100 )


1 Comp sales refers to the amount of sales a clinic generates in the most recent accounting period, compared to sales in the comparable period of the prior year, and (i) includes sales only from clinics that have been open at least 13 full months and (ii) excludes any clinics that have closed.

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Source: The Joint Corp.