The Joint Corp. Reports 2023 Operating Metrics
- 12% increase in annual system-wide sales
- 114 new clinics opened
- Initiatives to improve performance and profitability in 2024
- None.
The Joint Corp.'s announcement indicates a robust expansion strategy, with a 12% increase in system-wide sales and a 4% rise in comparable store sales (comp sales). The opening of 114 new clinics, expanding the total count to 935, is a significant development in the company's growth trajectory. This aggressive expansion could signal a strong market presence and increased brand recognition, which might attract investor interest. However, it is important to note the slowdown in growth compared to the previous year, with system-wide sales growth decelerating from 21% to 12% and comp sales growth reducing from 9% to 4%. This slowdown could be indicative of market saturation, increased competition, or operational challenges.
Moreover, the strategy to sell franchise licenses and refranchise corporate clinics might imply a shift towards a more asset-light business model, which can improve profitability and reduce operational risks. The intent to attract lapsed patients and extend memberships could also drive recurring revenue, enhancing customer lifetime value. Investors should monitor how these strategic changes impact financial performance in subsequent quarters, as they could affect the company's stock valuation.
The financial performance of The Joint Corp. reflects a mixed picture for investors. While the company is growing, evidenced by the increased patient visits and new patient acquisition, the year-over-year growth rates are declining. This could potentially raise concerns about the company's future growth potential and market position. The refranchising strategy may be a move to optimize capital allocation and focus on core competencies, which could lead to improved margins over time. However, investors should be cautious and consider whether the reduction in franchise licenses sold, from 75 to 55, is a temporary setback or a sign of deeper issues within the franchise model.
Investors should also evaluate the company's Q4 financial results once released, as they will provide a clearer picture of the company's year-end financial health and the effectiveness of the initiatives implemented in the fall. The market's reaction to these results will be telling, as it will encapsulate the confidence investors have in the company's ability to navigate macroeconomic challenges and execute its growth strategy.
The Joint Corp.'s focus on routine and affordable chiropractic care taps into the growing trend of preventive healthcare and wellness. The increase in patient visits and new patient counts suggests a rising demand for chiropractic services, which is a positive indicator for the healthcare sector. However, the company's performance must be contextualized within the broader healthcare industry. The reduced growth rate in system-wide sales and comp sales raises questions about market dynamics, such as the elasticity of demand for chiropractic services and the competitive landscape.
As the company moves forward with its refranchising strategy, it is crucial to assess the potential impact on quality control and customer experience, which are pivotal in healthcare services. The company's ability to maintain high standards while growing its franchise network will be key to its long-term success. Stakeholders should also consider how the company's initiatives to improve performance and profitability align with industry best practices and consumer expectations in the healthcare market.
- Grows Annual System-Wide Sales
- Increases Comp Sales of
- Opens 114 New Clinics, Expanding Year-end Total Clinic Count to 935 -
SCOTTSDALE, Ariz., Jan. 11, 2024 (GLOBE NEWSWIRE) -- The Joint Corp. (NASDAQ: JYNT), a national operator, manager, and franchisor of chiropractic clinics, provided operating metrics for the year ended 2023.
2023 Full Year Operating Highlights
- Performed 13.6 million patient visits, compared to 12.2 million in 2022.
- Treated 932,000 new patients, compared to 845,000 in 2022.
- Increased system-wide sales1
12% , compared to21% in 2022. - Delivered comp sales2 of
4% , compared to9% in 2022. - Sold 55 franchise licenses, compared to 75 in 2022.
- Expanded total clinic count to 935, up from 838 clinics at December 31, 2022.
- Opened 104, closed 13, and sold to corporate three franchised clinics for a total of 800 at December 31, 2023, compared to 712 at December 31, 2022.
- Opened 10, closed four, and acquired three company-owned or managed clinics for a total of 135 at December 31, 2023, compared to 126 at December 31, 2022.
“Our team’s dedication to improving quality of life through routine and affordable chiropractic care increased patient count and delivered continued growth in 2023, despite ongoing macroeconomic challenges,” stated Peter D. Holt, President and Chief Executive Officer of The Joint Corp. “In the fall, we began implementing several initiatives that we expect to improve our 2024 performance and profitability. To drive top-line growth and new patient count, we are enhancing our promotions, brand positioning, and media with an increased focus on attracting lapsed patients as well as elongating membership of existing patients. To improve the bottom line, we are executing our refranchising strategy for the majority of our corporate clinics. In the fourth quarter, we set systems in place to manage sales in clusters and sent non-disclosure agreements to approximately 100 franchisees who expressed interest. These actions are expected to strengthen the health of our franchise network and increase our ability to reinvest in the business to create value for our stakeholder.”
Q4 2023 Financial Results Reporting
Management intends to report its fourth quarter and year-end 2023 financial results on Thursday, March 7, 2024, after the market close. President and CEO Peter D. Holt and CFO Jake Singleton will hold a conference call at 5:00 p.m. ET that day to discuss the results.
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. 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. Specific forward looking statements made in this press release include, among others, our belief that in the fall we began implementing several initiatives that we expect will improve our 2024 performance and profitability; our plan to drive top-line growth and new patient count by enhancing our promotions, brand positioning, and media with an increased focus on attracting lapsed patients as well as elongating membership of existing patients; our plan to improve the bottom line by executing our refranchising strategy for the majority of our corporate clinics; our belief that our recent actions are expected to strengthen the health of our franchise network and increase our ability to reinvest in the business to create value for our stakeholders. Factors that could contribute to these differences include, but are not limited to, our inability to identify and recruit enough qualified chiropractors and other personnel to staff our clinics, due in part to the nationwide labor shortage and an increase in operating expenses due to measures we may need to take to address such shortage; inflation, exacerbated by COVID-19 and the current war in Ukraine, which has increased our costs and which could otherwise negatively impact our business; the potential for further disruption to our operations and the unpredictable impact on our business of the COVID-19 outbreak and outbreaks of other contagious diseases; our failure to profitably operate company-owned or managed clinics; short-selling strategies and negative opinions posted on the internet, which could drive down the market price of our common stock and result in class action lawsuits; our failure to remediate future material weaknesses in our internal control over financial reporting, which could negatively impact our ability to accurately report our financial results, prevent fraud, or maintain investor confidence; and other factors described in our filings with the SEC, including in the section entitled “Risk Factors” in our Annual Report on Form 10-K/A for the year ended December 31, 2022 filed with the SEC on September 26, 2023 and subsequently filed current and quarterly reports. 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)
The Joint Corp. (NASDAQ: JYNT) revolutionized access to chiropractic care when it introduced its retail healthcare business model in 2010. Today, it is the nation's largest operator, manager and franchisor of chiropractic clinics through The Joint Chiropractic network. The company is making quality care convenient and affordable, while eliminating the need for insurance, for millions of patients seeking pain relief and ongoing wellness. With more than 900 locations nationwide and over 13 million patient visits annually, The Joint Chiropractic is a key leader in the chiropractic industry. Consistently named to Franchise Times “Top 500+ Franchises” and Entrepreneur’s “Franchise 500” lists and recognized by FRANdata with the TopFUND award, as well as Franchise Business Review’s “Top Franchise for 2023,” “Most Profitable Franchises” and “Top Franchises for Veterans” ranking, The Joint Chiropractic is an innovative force, where healthcare meets retail.
For more information, visit www.thejoint.com. To learn about franchise opportunities, visit www.thejointfranchise.com.
Business Structure
The Joint Corp. is a franchisor of clinics and an operator of clinics in certain states. In Arkansas, California, Colorado, District of Columbia, Florida, Illinois, Kansas, Kentucky, Maryland, Michigan, Minnesota, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, Washington, West Virginia and Wyoming, The Joint Corp. and its franchisees provide management services to affiliated professional chiropractic practices.
Media Contact: Margie Wojciechowski, The Joint Corp., margie.wojciechowski@thejoint.com
Investor Contact: Kirsten Chapman, LHA Investor Relations, 415-433-3777, thejoint@lhai.com
1 System-wide sales include sales at all clinics, whether operated by the Company or by franchisees. While franchised sales are not recorded as revenues by the Company, management believes the information is important in understanding the Company’s financial performance, because these sales are the basis on which the Company calculates and records royalty fees and are indicative of the financial health of the franchisee base.
2 Comp sales include the sales from both company-owned or managed clinics and franchised clinics that in each case have been open at least 13 full months and exclude any clinics that have closed, respectively.
FAQ
How much did The Joint Corp. (JYNT) increase its annual system-wide sales by in 2023?
How many new clinics did The Joint Corp. (JYNT) open in 2023?
What initiatives did The Joint Corp. (JYNT) outline to improve performance and profitability in 2024?
When will The Joint Corp. (JYNT) report its Q4 2023 financial results?
