The Joint Corp. · NASDAQ:JYNT
The Joint — JOINT — Q4 2019 Earnings Presentation
21 slides from The Joint's earnings presentation, Mar 5, 2020
Slide 1: Q4 2019 Financial Results
© 2019 The Joint Corp. All Rights Reserved. 1 Q4 2019 Financial Results As of December 31, 2019 | Reported On March 5, 2020
Slide 2: Safe Harbor Statement
Safe Harbor Statement © 2020 The Joint Corp. All Rights Reserved. 2 Certain statements contained in this presentation are "forward - looking statements." We have tried to identify these forward - look ing statements by using words such as "may," "might," " will," "expect,” "anticipate,'' "'believe,“
Slide 3: Accelerating Momentum
Accelerating Momentum 12 26 82 175 242 265 309 352 394 453 4 47 61 47 48 60 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Total Clinics Open Franchise Company Owned/Managed © 2019 The Joint Corp. All Rights Reserved. 3 0 5 Franchise Licenses Sold Total New Franchised Clinics Opened Greenfield Cl
Slide 4: RDs Accelerate Franchise License Sales
RDs Accelerate Franchise License Sales 4 1 Of the 841 franchise licenses sold as of December 31, 2019, 204 are in active development, 513 are currently operating and th e b alance represents terminated/closed licenses. • 78% of clinics supported by RDs • RDs cover 53% of Metropolitan Statistical Are
Slide 5: Our Mission
Our Mission 5 To improve quality of life through routine and affordable chiropractic care Q4 2019 vs Q4 2018 2019 vs 2018 System - wide sales growth Comp sales >13 months 1 Comp sales >48 months 1 34% 26% 19% 33% 25% 19% Revenue $13.9M up 39% $48.5M up 32% Net Income $1.3M, up $855K $3.3M, up $3.2M
Slide 6: Continuing Strong Time to Breakeven
Continuing Strong Time to Breakeven © 2019 The Joint Corp. All Rights Reserved. 6 * Based on average historical gross sales growth rates from January 2013 through January 2020 ** Number of clinics in operation by the number of months opened, partial months not included. 62 55 49 38 34 28 23 19 13 11
Slide 7: Increasing Investment in Awareness
Increasing Investment in Awareness 7 Multiple Campaign Channels Building a Positive, Authentic Brand • Launched “You’re back, baby.” • Sharing patients’ real success stories • Leveraging increased local market penetration • Forming advertising coops • Executing sophisticated media buys: TV, radio, o
Slide 8: Marketing Co-Ops Growing in Strength & Sophistication
Marketing Co - Ops Growing in Strength & Sophistication 8 Co - Ops: Another driver for growing brand awareness • Improves local franchisee organization and collaboration • Increases media options and efficiencies • Bridges gap between national and local clinic advertising © 2020 The Joint Corp. All
Slide 9: Implementing AXIS, New IT Platform
Implementing AXIS, New IT Platform 9 • Conducting internal testing • Implementing robust training • 2020 rollout © 2020 The Joint Corp. All Rights Reserved.
Slide 10: Exceptional System-wide Sales Growth
Exceptional System - wide Sales Growth © 2019 The Joint Corp. All Rights Reserved. 10 33% Annual system - wide sales 1 2019 over 2018 25% Annual comp sales 2 for clinics >13 months in operation 2019 over 2018 19% Annual comp sales 2 for clinics >48 months in operation 2019 over 2018 1 System - wide
Slide 11: Q4 2019 Improvements
Q4 2019 Improvements 11 5 th Consecutive Quarter of Net Income, 10 th Consecutive Quarter of Positive Adjusted EBITDA $ in M 1 Q4 2019 Q4 2018 Increases Revenue • Corporate clinics • Franchise fees $13.9 7.6 6.3 $10.0 5.2 4.8 $3.9 2.4 1.6 39% 45% 33% Cost of revenue 1.6 1.2 0.4 36% Sales and marketi
Slide 12: 2019 Improvements
2019 Improvements 12 2 nd Full Year of Positive Adjusted EBITDA $ in M 1 2019 2018 Increases Revenue • Corporate clinics • Franchise fees $48.5 25.8 22.6 $36.7 19.5 17.1 $11.8 6.3 5.5 32% 32% 32% Cost of revenue 5.6 4.3 1.3 29% Sales and marketing 6.9 4.8 2.1 43% Depreciation 1.9 1.6 0.3 22% G&A 30.
Slide 13: 2020 Guidance
2020 Guidance 13 1 Reconciliation of Adjusted EBITDA to GAAP earnings is included in the appendix. | 2 Through a combination of both greenfields and buybacks. $ in M 2019 Actual Low Guidance High Guidance Revenues $48.5 $61 $63 Adjusted EBITDA 1 $6.2 $8.5 $9.5 New Franchised Clinics 71 80 90 New Com
Slide 14: The Pain Epidemic Continues
The Pain Epidemic Continues © 2019 The Joint Corp. All Rights Reserved. 14 Sources: 2018. https://wonder.cdc.gov . | Vivolo - Kantor, AM, Seth, P, Gladden, RM, et al. Vital Signs: Trends in Emergency Department Visits for Suspected Opioid Overdoses -- United States, July 2016 - September 2017 . Cent
Slide 15: Market Opportunity: 1800+ Potential Clinics
Market Opportunity: 1800+ Potential Clinics © 2019 The Joint Corp. All Rights Reserved. 15 The Joint Patient Base With usable addresses in last 21 months • All 50 States, DC, and Puerto Rico • All Canadian Provinces and Territories • 24 Countries on 6 Continents 1800+ similar points of distribution
Slide 16: Building Nationwide Brand to Deliver Shareholder Value
$1.3 $2.8 $8.1 $22.3 $46.2 $70.1 $98.6 $126.9 $165.1 $220.3 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 © 2019 The Joint Corp. All Rights Reserved. 16 Building Nationwide Brand to Deliver Shareholder Value Continue to focus on franchise sales • Further leverage RD strategy Accelerate the expan
Slide 17: Non-GAAP Measure Definition
Non - GAAP Measure Definition 17 This presentation includes a presentation of EBITDA and Adjusted EBITDA, which are non - GAAP financial measures. EBITDA and Adjus ted EBITDA are presented because they are important measures used by management to assess financial performance, as management believes
Slide 18: Q4 2019 Segment Results
Q4 2019 Segment Results 18 2019 Q4 © 2020 The Joint Corp. All Rights Reserved. Corporate Clinics Franchise Operations Unallocated Corporate The Joint Consolidated Total Revenues $ 7,562 $ 6,313 $ 0 $ 13,875 Total Operating Costs (6,422) (3,233) (2,877) (12,532) Operating Income (Loss) 1,140 3,080 (2
Slide 19: Full Year 2019 Segment Results
Full Year 2019 Segment Results 19 2019 12 Mos. © 2020 The Joint Corp. All Rights Reserved. Corporate Clinics Franchise Operations Unallocated Corporate The Joint Consolidated Total Revenues $ 25,808 $ 22,642 $ 0 $ 48,451 Total Operating Costs (22,443) (11,668) (10,926) (45,036) Operating Income (Los
Slide 20: GAAP – Non-GAAP Reconciliation
GAAP – Non - GAAP Reconciliation 20 © 2020 The Joint Corp. All Rights Reserved. Q1 - 18 Q2 - 18 Q3 - 18 Q4 - 18 FY18 Q1 - 19 Q2 - 19 Q3 - 19 Q4 - 19 FY19 Total Revenue 8,647 8,805 9,242 9,968 36,662 10,679 11,170 12,726 13,875 48,451 Total Cost of Revenue 972 1,052 1,085 1,202 4,310 1,206 1,299 1,42
Slide 21: Contact Information
Jake Singleton, CFO jake.singleton@thejoint.com The Joint Corp. | 16767 N. Perimeter Dr., Suite 110, Scottsdale, AZ 85260 | (480) 245 - 5960 https://www.facebook.com/thejointchiro @ thejointchiro https://twitter.com/thejointchiro @ thejointchiro https://www.youtube.com/thejointcorp @ thejointcorp Pe