JYNT's Q3 Earnings Meet Estimates Amid Higher Costs, Shares Dip 3%

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The Joint Corp.’s JYNT shares have lost 2.7% since it reported third-quarter 2024 results. The quarterly results were hurt by an elevated general and administrative expense level. Impairment-related charges also affected the bottom line.

Nevertheless, the downside was offset by higher system-wide sales, led by improved royalty fees, advertising fund revenues and software fees.

JYNT reported adjusted earnings per share of 4 cents, which matched the Zacks Consensus Estimate. The bottom line compared favorably with the adjusted loss of 5 cents per share reported a year ago.

Revenues improved 2% year over year to $30.2 million. The top line surpassed the consensus mark by 5.5%.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

The Joint Corp. Price, Consensus and EPS Surprise

The Joint Corp. Price, Consensus and EPS Surprise
The Joint Corp. Price, Consensus and EPS Surprise

The Joint Corp. price-consensus-eps-surprise-chart | The Joint Corp. Quote

JYNT’s Q3 Performance

Revenues from company-owned or managed clinics of $17.5 million dipped 1.9% year over year. Royalty fees advanced 10.2% year over year to $7.9 million in the third quarter. Advertising fund revenues were $2.2 million, up 9.6% year over year. Software fees of $1.4 million improved 10% year over year. Meanwhile, franchise fees fell 7.5% year over year to $0.7 million.

Total cost of revenues amounted to $2.8 million, which escalated 8.4% year over year due to increased regional developer royalties and commissions. General and administrative expenses increased 2.7% year over year to $20.8 million. However, total selling, general and administrative costs dipped 0.4% year over year to $26.8 million.

The Joint incurred a net loss of $3.2 million, wider than the prior-year quarter’s net loss of $0.7 million due to a loss incurred on disposition or impairment.

System-wide sales rose 8% year over year to $129.3 million. As of Sept. 30, 2024, the company’s total clinic count was 963, lower than the Zacks Consensus Estimate of 975. The number of franchised clinics totaled 838, which was lower than the consensus mark of 864. Yet, company-owned or managed clinics were 125, higher than the consensus estimate of 111.

Adjusted EBITDA tumbled 16% year over year to $2.4 million.

The Joint’s Financial Update (as of Sept. 30, 2024)

JYNT exited the third quarter with cash and cash equivalents of $20.7 million, which increased 14.2% from the 2023-end level.

Total assets of $79.6 million fell 8.7% from the figure at 2023-end.

There was no reported debt under the credit agreement.

Total equity of $20.5 million declined 17.3% from the 2023-end level.

The Joint generated net cash from operations of $5.3 million for the first nine months ended Sept. 30, 2024, which dropped 53.2% from the prior-year period.

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