Executive Summary

Q2 2020 revenues fell 31.5% year over year to $2.57M and declined 22.6% sequentially from Q1, driven by COVID-19-related visit reductions; operating loss improved sequentially to $(1.71)M as grant funds offset expenses and cost actions took hold .
Net loss attributable to IMAC was $(2.03)M (EPS $(0.20)), versus $(1.90)M (EPS $(0.23)) in Q2 2019; the EPS improvement despite a larger loss reflects higher average shares outstanding .
Liquidity position strengthened with cash increasing to $2.80M at quarter-end, aided by a $2.65M registered direct offering (June 18, 2020) and $2.1M+ in HHS/SBA aid; management also executed a sale-leaseback on July 24 eliminating ~$1.23M of liabilities .
Strategic catalysts: FDA authorization to initiate a Phase 1 clinical study using umbilical cord-derived allogenic mesenchymal stem cells for Parkinson’s bradykinesia, and early signs of recovery with June same-store visits +7% YoY; Wellness Memberships rose 30% q/q to 637 .

What Went Well and What Went Wrong

What Went Well

Government support and grants cushioned COVID-19 impact: IMAC received >$2.1M in HHS/SBA aid; $0.416M in grant funds reduced operating expenses in Q2, improving sequential operating loss despite lower revenue .
Early demand indicators improved into June: same-store visit growth was +7% vs. June 2019, suggesting a rebound as restrictions eased .
Strategic advances and cash actions: FDA authorization for a Phase 1 Parkinson’s bradykinesia study and a $2.65M equity raise reinforced liquidity; sale-leaseback (July 24) eliminated ~$1.232M liabilities while securing a five-year lease .
- Quote: “We have already witnessed a recovery in business as evidenced in same-store visit growth of 7% in June 2020 as compared to June 2019” — CEO Jeffrey Ervin .

What Went Wrong

Top-line pressure from COVID-19: Patient service revenues declined 31.5% YoY to $2.57M (from $3.76M), reflecting fewer patient visits during the quarter .
Persistent losses: Net loss attributable to IMAC widened YoY to $(2.03)M (from $(1.90)M); operating expenses remained elevated despite reductions and grant offsets, including depreciation/amortization $0.454M .
Workforce and cost rationalization: Headcount fell to 133 at June 30, down 16% YTD, underscoring operational stress and ongoing cost management needs .

Financial Results

Metric	Q2 2019	Q1 2020	Q2 2020
Revenue ($USD Millions)	$3.757	$3.322	$2.573
Operating Loss ($USD Millions)	$(2.112)	$(1.994)	$(1.709)
Net Loss Attributable to IMAC ($USD Millions)	$(1.901)	$(1.734)	$(2.031)
Diluted EPS ($)	$(0.23)	$(0.18)	$(0.20)
Operating Margin % (Calculated)	(56.2%) (calc from )	(60.0%) (calc from )	(66.5%) (calc from )
Net Income Margin % (Calculated)	(50.6%) (calc from )	(52.2%) (calc from )	(79.0%) (calc from )

Notes:

Q2 recognized grant funds of $0.416M within operating expenses, reducing total reported operating expenses for the quarter .
No segment revenue breakdown was provided in the press release/8-K .

KPIs and Operating Metrics

KPI	Q1 2020	Q2 2020
Wellness Membership Subscribers (end-period)	~500	637 (+30% q/q)
Same-Store Visit Growth (June YoY)	n/a	+7% vs. June 2019
Headcount (end-period)	n/a	133 (down 16% YTD)
Government Aid (cumulative)	n/a	>$2.1M (HHS/SBA)
Cash and Equivalents ($USD Millions)	$1.282	$2.803
Net Revenue per Visit ($)	$109.54	n/a

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
All metrics	2020 outlook	None provided	None provided	n/a

No formal quantitative guidance was provided in the Q2 2020 materials .

Earnings Call Themes & Trends

No Q2 2020 earnings call transcript was located despite targeted searches; we reviewed press releases and SEC filings instead .

Topic	Q4 2019 (Q-2)	Q1 2020 (Q-1)	Q2 2020 (Current)	Trend
COVID-19 impact & telehealth	Telehealth launched; contingency planning noted post-year-end	Telehealth adopted; 1,000+ telehealth appointments; all clinics reopened by May 4	Lower volumes but recovery in June; cost synergies and grants mitigated impact	Stabilizing with recovery signs
Government aid	n/a (year-end context)	n/a	>$2.1M HHS/SBA aid; $0.416M grants recognized in Q2 P&L	Supportive tailwind
Membership program	Program initiated post-2019	~500 active plans by quarter-end	637 members (+30% q/q)	Growing
Clinical/biologics strategy	n/a	IND submitted for stem cell study in bradykinesia (May 12)	FDA authorized Phase 1 study; aim to leverage clinics to reduce trial costs	Advancing
Liquidity & capital actions	IPO impact discussed; debt and leases detailed	$1.115M secured note (10% coupon) closed Mar 25	$2.65M equity raise (June); sale-leaseback eliminated ~$1.232M liabilities (July)	Strengthening balance sheet

Management Commentary

“While there was a decrease in patient visits and revenue, our implementation of advanced telemedicine therapy, acceleration of expense synergies, and utilization of government-sponsored aid helped us avoid a catastrophic reduction in business.” — Jeffrey Ervin, CEO .
“We have already witnessed a recovery in business as evidenced in same-store visit growth of 7% in June 2020 as compared to June 2019.” — Jeffrey Ervin, CEO .
Q1 context: “Based on… easing of temporary government restrictions… all of our facilities have reopened to full operation as of May 4, 2020.” — Jeffrey Ervin, CEO .

Q&A Highlights

No public Q2 2020 earnings call transcript or Q&A could be located via SEC/IR sites and press sources; therefore no Q&A themes or clarifications were available to summarize .

Estimates Context

We attempted to retrieve S&P Global consensus (revenue and EPS) for Q2 2020 and adjacent periods; data was unavailable at query time due to service limits. As a result, we cannot compare actuals to consensus for this quarter. Values retrieved from S&P Global could not be displayed due to access limitations at the time of request.

Key Takeaways for Investors

COVID-19 compressed Q2 visits and revenue, but sequential operating loss improved aided by $0.416M in grant funds and cost synergies; watch for normalization of grant effects on run-rate margins .
Early rebound signs surfaced in June (+7% same-store visits YoY) and membership subscriptions grew 30% q/q to 637, offering recurring-revenue leverage if sustained .
Liquidity improved: $2.80M cash at quarter-end, supplemented by a $2.65M equity raise; sale-leaseback reduced liabilities by ~$1.232M—near-term balance sheet resilience has increased .
Strategic optionality from FDA-cleared Phase 1 Parkinson’s study may diversify revenue longer term; near-term P&L impact minimal but clinical progress could be a catalyst .
Absent formal guidance, trajectory will hinge on sustained volume recovery, retention of Wellness Memberships, and payer mix; monitor Q3 sequential growth in visits/revenue for confirmation .
Capital structure considerations: earlier (Q1) secured note included restrictive features and step-ups; subsequent equity raise helps mitigate refinancing risk—continue to monitor covenant/obligation implications .

Appendix: Prior Two Quarters’ Earnings Materials Reviewed

Q1 2020 8-K press release and full financial tables (May 14/15, 2020) .
FY 2019 8-K press release (March 26/30, 2020) for context on pre-COVID operations and post-year-end telehealth/membership initiatives .

Additional Q2-period press releases:

Registered direct offering of $2.65M common stock (June 18, 2020) .

Sources: Q2 2020 8-K and EX-99.1 press release and financials ; Q1 2020 8-K press release and financials ; FY2019 8-K press release .

IMAC Holdings, Inc. (BACK)·Q2 2020 Earnings Summary