The Joint Corp. (Nasdaq:JYNT), a national healthcare franchisor of
chiropractic clinics, today reported financial results for the
third quarter and nine months ended September 30, 2014.
Third Quarter and Nine Month Results
Highlights
- Third quarter revenues increased 23.3% to $1.82 million
- Nine month revenues increased 17.6% to $5.06 million
- The number of clinics in operation increased to 230 at
September 30, 2014, an increase of 76 clinics from September 30,
2013
"The first nine months of 2014 were a period of strong revenue
growth as we continued to open up clinics nationally and as
existing franchise clinics continued to mature," remarked John
Richards, CEO of The Joint Corp. "We expect to add an additional 70
to 90 clinics in 2015, with an increasing blend of corporate owned
clinics and the continued, but more focused, expansion of franchise
clinics as the hallmark of our future strategy."
Mr. Richards continued, "Our strategy is to become the leader in
the national market for core chiropractic adjustment services
through the development of conveniently located, private
pay/cash-only, clinics that provide affordable care by an
exceptional team of licensed chiropractors. We expect that our
recent initial public offering will provide the resources to
accelerate our national expansion."
"Also, we are pleased to announce the appointment of Francis T.
Joyce as chief financial officer and treasurer," Mr. Richards
continued. "Frank comes to us with a wealth of emerging and
established public company experience as a CFO, including IMAX
Corporation (NYSE:IMAX), theglobe.com and Mistras Group, Inc.
(NYSE:MG). Frank is a CPA and holds an M.B.A. from Fordham
University. His appointment is effective immediately."
Third Quarter Financial Results
Revenues increased 23.3% in the third quarter of 2014 to $1.82
million from $1.47 million in the third quarter last year as the
number of clinics increased by 76, or 49%, to 230 at September 30,
2014, from 154 at September 30, 2013. Revenue growth was partially
offset by a reduction in initial franchise fees as the result of
eight fewer clinics being opened during the third quarter of 2014
compared to the third quarter of 2013.
Total cost of revenues in the third quarter of 2014 increased
20.4% due predominantly to a greater number of franchises opened in
regional developer territories compared to the same period last
year. Total cost of revenues as a percentage of sales was 32.2% in
the third quarter of 2014 compared to 33.0% in the third quarter
last year.
Selling and marketing expenses increased to $324,177 in the
third quarter of 2014 compared $141,212 in the third quarter of
2013 due to sales and marketing related travel expenses and IPO
related travel. This increase was partially offset by a decrease in
direct selling expenses attributable to a more focused selling and
marketing strategy launched in 2014.
Depreciation and amortization expenses increased for the third
quarter of 2014 as compared to the same period last year, due to
the addition of fixed assets associated with relocation and
expansion of our corporate office, related tenant improvement
expenses, software enhancements and website development
expenses.
General and administrative expenses increased to $1.16 million
in the third quarter of 2014 compared to $631,932 in the third
quarter of 2013, due to an increase in the number of employees to
support our growth initiatives, and, to a lesser extent, an
increase in professional, staffing and recruitment fees.
Net loss in the third quarter of 2004 was $(202,373), or $(0.04)
per share, compared to net income of $42,547, or $0.01 per diluted
share in third quarter 2013.
Nine Month Financial Results
Revenues increased 17.6% for the first nine months of 2014 to
$5.06 million from $4.31 million in the same period last year, due
to the greater number of clinics opened at September 30, 2014,
compared to September 30, 2013. Revenue growth was partially offset
by a reduction in initial franchise fees as the result of 17 fewer
clinics being opened during the first nine months of 2014 compared
to the same period last year.
Total cost of revenues in the first nine months of 2014
increased 11.9% due predominantly to a greater number of franchises
opened in regional developer territories compared to the same
period last year. Total cost of revenues as a percentage of sales
was 33.0% in the first nine months of 2014 compared to 34.7% in the
same period last year.
Selling and marketing expenses increased to $723,995 in the
first nine months of 2014, compared to $603,490 in the same period
of 2013, due to sales and marketing related travel expenses and IPO
related travel. This increase was partially offset by a decrease in
direct selling expenses which is attributable to a more focused
selling and marketing strategy to be launched in 2014.
Depreciation and amortization expenses increased for the first
nine months of 2014 as compared to the same period last year, due
to addition of fixed assets associated with relocation and
expansion of our corporate office, related tenant improvement
expenses, software enhancements and website development
expenses.
General and administrative expenses increased to $3.22 million
in the first nine months of 2014, compared to $1.86 million in the
same period of 2013, due to an increase in the number of employees
to support our growth initiatives, and, to a lesser extent, an
increase in professional fees and staffing and recruitment related
fees.
Net loss for the first nine months of 2004 was $(464,019), or
$(0.10) per share, compared to net income of $155,899, or $0.02 per
diluted share in same period of 2013.
As of September 30, 2014, cash and cash equivalents were $2.59
million, compared to $3.58 million at September 30, 2013. During
November 2014 we completed an initial public offering, issuing
3,450,000 common shares at $6.50 per share for net proceeds of
approximately $20.00 million.
Conference Call
The Joint Corp. management will host a conference call at 11:00
a.m. EST (9:00 a.m. MST) on Monday, December 22, 2014 to discuss
results for the third quarter and first nine months of 2014. The
conference call will be accessible by dialing 844-464-3931 (U.S.)
or 765-507-2604 (international), and referencing 47705292. A live
webcast of the conference call will also be available on the
investor relations section of the company's website at
www.thejoint.com.
An audio replay will be available two hours after the conclusion
of the call through January 5, 2015. The replay can be accessed by
dialing (855) 859-2056 or (404) 537-3406. The passcode for the
replay is 47705292.
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 The Joint Corps.'
Registration Statement on Form S-1. 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.
The Joint…the chiropractic place® is reinventing chiropractic
care by making quality alternative healthcare affordable for
patients seeking pain relief and ongoing wellness. Our affordable
plans and packages eliminate the need for insurance, and our
no-appointment policy, convenient hours and locations make care
more accessible. The Joint performs more than one million spinal
adjustments a year across 240+ clinics nationwide. For more
information, visit www.thejoint.com, follow us on Twitter
@thejointchiro and find us on Facebook, YouTube and
LinkedIn.
THE JOINT CORP. AND
SUBSIDIARY |
CONDENSED CONSOLIDATED
BALANCE SHEET DATA |
|
|
September 30, |
December 31, |
|
2014 |
2013 |
|
(unaudited) |
(audited) |
|
|
|
Cash and cash equivalents |
$ 2,591,661 |
$ 3,575,536 |
Property and equipment |
794,383 |
400,267 |
Deferred franchise costs |
3,044,750 |
3,222,750 |
Other assets |
3,344,773 |
2,569,882 |
Total assets |
9,775,567 |
9,768,435 |
Deferred revenue |
9,459,000 |
10,008,334 |
Other liabilities |
1,983,911 |
980,962 |
Total liabilities |
11,442,911 |
10,989,296 |
Stockholders' deficit |
(1,642,833) |
(1,220,861) |
|
THE JOINT CORP. AND
SUBSIDIARY |
CONDENSED CONSOLIDATED
STATEMENT OF OPERATIONS |
|
|
|
|
|
|
Three Months
Ended |
Nine Months
Ended |
|
September
30, |
September
30, |
|
2014 |
2013 |
2014 |
2013 |
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
|
|
|
|
Total revenues |
$ 1,816,595 |
$ 1,472,776 |
$ 5,061,266 |
$ 4,305,588 |
Cost of revenues |
(585,819) |
(486,755) |
(1,670,556) |
(1,493,484) |
Selling and marketing expenses |
(324,177) |
(141,212) |
(723,955) |
(603,490) |
Depreciation and amortization |
(52,823) |
(19,142) |
(141,707) |
(50,656) |
General and administrative expenses |
(1,164,601) |
(631,932) |
(3,215,242) |
(1,859,538) |
Income (loss) from operations |
(310,825) |
193,735 |
(690,194) |
298,420 |
Other expense |
(54,599) |
(5,000) |
(58,399) |
(27,000) |
Income (loss) before income tax (provision)
benefit |
(365,424) |
188,735 |
(748,593) |
271,420 |
Income tax (provision) benefit |
163,051 |
(146,188) |
284,574 |
(115,521) |
Net income (loss) |
(202,373) |
42,547 |
(464,019) |
155,899 |
|
|
|
|
|
Basic earnings (loss) per share |
$ (0.04) |
$ 0.01 |
$ (0.10) |
$ 0.03 |
Diluted earnings (loss) per share |
$ (0.04) |
$ 0.01 |
$ (0.10) |
$ 0.02 |
|
|
|
|
|
Weighted average common shares outstanding -
basic |
4,828,122 |
5,340,000 |
4,819,861 |
5,340,000 |
Weighted average common shares outstanding -
diluted |
4,828,122 |
6,675,000 |
4,819,861 |
6,675,000 |
|
THE JOINT CORP. AND
SUBSIDIARY |
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS |
|
|
|
|
Nine Months
Ended |
|
September
30, |
|
2014 |
2013 |
|
(unaudited) |
(unaudited) |
|
|
|
Net (loss) income |
$ (464,019) |
$ 155,899 |
Adjustments to reconcile net (loss) income to
net cash |
275,585 |
237,289 |
Changes in operating assets and
liabilities |
74,052 |
127,802 |
Net cash (used in) provided by operating
activities |
(114,382) |
520,990 |
Net cash used in investing activities |
(516,522) |
(135,150) |
Net cash used in financing activities |
(511,921) |
-- |
Net (decrease) increase in cash |
$ (1,142,825) |
$ 385,840 |
CONTACT: Investor Contact:
Peter Vozzo
peter.vozzo@westwicke.com
443-213-0505
Media Contact:
Marcia Rhodes
mrhodes@acmarketingpr.com
480-664-8412, ext. 15
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