The Joint Corp - Earnings Call - Q1 2021

Transcript

Speaker 0

Good day and thank you for standing by. Welcome to The Joint Corporation First Quarter twenty twenty one Financial Results Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded.

I would now like to hand the conference over to Moriah Shilton of LHA Investor Relations. Please go ahead.

Speaker 1

Thank you, Rachel. We are on slide one. Good afternoon, everyone. This is Moriah Shilton of LHA Investor Relations. On the call today, President and CEO, Peter Holt, will review our first quarter twenty twenty one performance metrics and provide an update on the business.

CFO, Jake Singleton, will detail our financial results. Then Peter will close with a summary and open the call for questions. Please note, we are using a slide presentation that can be found at ir.thejoint.com/events. Today after the close of the market, The Joint Corp. Issued its financial results for the year and quarter ended 03/31/2021.

If you do not already have a copy of this press release, it can be found in the Investor Relations section of the company's website. As provided on slide two, please be advised today's discussion includes forward looking statements, including statements concerning our strategy, future operations, future financial position and plans and objectives of management. Throughout today's discussion, we will present some important factors relating to our business that could affect these forward looking statements. The forward looking statements are made based on our current predictions, expectations, estimates and assumptions and are also subject to risks and uncertainties that may cause actual results to differ materially from the statements we make today. Factors that could contribute to these differences include, but are not limited to, the continuing impact of the COVID-nineteen outbreak on the economy and our operations, including temporary clinic closures, shortened business hours and reduced patient demand our failure to develop or acquire company owned or managed clinics as rapidly as we intend our failure to profitably operate company owned or managed clinics and any other factors described in Risk Factors in our Annual Report on Form 10 ks as filed with the SEC for the year ended 12/31/2020, as updated or revised for any material changes described in any subsequently filed quarterly reports on Form 10 Q or other SEC filings.

We anticipate filing our 03/31/2021, 10 Q on May 7. As a result, we caution you against placing undue reliance on these forward looking statements and encourage you to review our filings with the SEC for a discussion of these factors and other risks that may affect our future results or the market price of our stock. Finally, we are not obligating ourselves to revise our results or publicly release any updates to these forward looking statements in light of new information or future events. Management uses EBITDA and adjusted EBITDA, which are non GAAP financial measures. These are presented because they are important measures used by management to assess financial performance.

Management believes they provide a more transparent view of the company's underlying operating performance and operating trends than GAAP measures alone. Reconciliation of net income to EBITDA and adjusted EBITDA is presented in the press release. The company defines EBITDA as net income or loss before net interest, tax expense, depreciation and amortization expenses. The company defines adjusted EBITDA as EBITDA before acquisition related expenses, bargain purchase gain, net gain or loss on disposition or impairment and stock based compensation expenses. Turning to slide three.

And it is my pleasure to turn the call over to Peter Holt.

Speaker 2

Thank you, Moriah, and I welcome everybody to the call. I'm delighted to speak with you today. We've entered 2021 well positioned with a resilient business model and accomplished team operating at a very high level and a strong financial position. During the first quarter, we continued to execute our plan to accelerate growth and deliver strong results. In April, we celebrated our six hundredth clinic opening and we continue to strive to reach our goal of 1,000 clinics in operation by the end of twenty twenty three.

Let me be perfectly clear. This is just one of many milestones and just the beginning of our long term growth blueprint. Before I elaborate, I'll review our operational and financial performance for the quarter. I'd like to begin by welcoming and educating our new investors. The Joint is revolutionizing access to chiropractic care.

Our core concept has remained steadfast. Located in convenient retail settings, we provide style membership based services without the need for insurance or appointments with attractive pricing and convenient hours. Our growth strategy is to build on our brand, increase awareness of the efficacy of chiropractic care, attract new patients and open more clinics. We're already the largest and most recognizable provider of chiropractic care in the country. Given the high level of fragmentation among chiropractic care providers, we have a significant opportunity to continue increasing our market share as we redefine and expand the market itself.

Turning to slide four. While Jake will discuss our financial results in detail in a minute, here are a few highlights of our strong first quarter twenty twenty one results. Revenue grew 29% compared to first quarter twenty twenty. System wide sales grew to $77,800,000 increasing 28% compared to the first quarter last year. Our comp sales clinics have been open for at least thirteen full months grew 21% compared to the same period in 2020.

Adjusted EBITDA more than doubled to $3,500,000 And at 03/31/2021, our unrestricted cash was $17,800,000 compared to $20,600,000 at 12/31/2020. Turning to slide five. In late March, we held our virtual awards annual awards program where we honored the top twenty twenty individual and clinic performances in our network. Our clinics achieved new highs even during the pandemic. Of the 73 new clinics opened in 2020, 15 achieved Go Elite status, meaning that they acquired over 400 patients and recorded more than $30,000 in sales in the first two months of operation.

In fact, 169 clinics achieved more than $550,000 in sales in 2020, up 19% compared to 2019. That included nine platinum clinics with over $1,000,000 in sales, up from four platinum clinics the previous year. Our undisputed sales champion earned Diamond Clinic status for the second year in a row with over $1,500,000 in annual sales. All of this illustrates the degree to which our clinic teams both franchised and corporate are motivated to achieve new levels of success. They see the consumer demand.

They see the power of this business model. They see the brand differentiation and they see our category leadership. We acknowledge all of the outstanding performers and look forward to welcoming an even greater number of clinics into the ranks in 2021. Turning to slide six, let's review our portfolio. Regarding clinics during Q1, we opened 12 new franchise clinics and one greenfield compared to sixteen and one in 2020 respectively.

We did not close any clinics in this quarter. At 03/31/2021, we had five ninety two clinics in operation consisting of five twenty seven franchise clinics and 65 company owned or managed clinics maintaining a mix of 89% franchise and 11% corporate. We also had two sixty franchise agreements in some level of development. That compares to two fifty three at the December and reflects the increased interest in our franchise system. We're on track with our prior guidance of opening between 8,100 franchise clinics this year.

On April 1, we expanded the corporate portfolio further. We opened our second greenfield of the year in Yuma, Arizona. And in addition, we acquired eight previously franchised clinics, all of which were expected to be immediately accretive to the bottom line. Two of the clinics are in the Phoenix, Scottsdale market, expanding our presence in our strong headquarters region. Six of the clinics are in North Carolina.

This transaction made possible by the recent repurchase of the regional developer rights for that territory broadens our foothold in the Southeast. All of these acquisitions were anticipated and included in our prior guidance of increasing company owned or managed clinics by 20 to 30 clinics in 2021 through a combination of both greenfields and franchise clinic purchases. Turning to slide seven. In the first quarter of twenty twenty one, we sold 26 franchise licenses compared to 24 in the first quarter of twenty twenty. 81% were sold by our regional developers.

RDs are becoming more productive in their roles and we're attracting a higher quality of new franchisee well capitalized with a greater sophistication and multi unit experience gained from other systems. We utilize the RD strategy to accelerate growth. Generally, we enter a ten year agreement with RDs to assist with the sale and support of clinics. RDs have a goal to maximize the number of franchise clinics in their territory and a contractual obligation for the development of a minimum number of clinic, which is front loaded. When markets reach maturity, it's not unusual for the franchisor to repurchase the RD rights.

As we discussed in our previous call in March, we did so in two well run mature markets North Carolina on 12/31/2020 and Georgia on 01/01/2021. The purchase price for these transactions totaled $2,400,000 As a result of these RD repurchases, 69 franchise clinics and 37 signed franchise license agreements for unopened clinics shifted from management by RDs to corporate management, thereby eliminating the RD sales commission and royalties of 3% on gross sales for those clinics. The transactions are immediately accretive and expand our margin contribution. On 03/31/2021, 68% of our clinics were supported by our 21 RDs, which covered 57 of the Metropolitan Statistical Areas or MSAs. Today, our aggregate ten year minimum development schedule for new RD territories established since 2017 comes to four eighty six clinics.

This large foundation of clinic commitment bodes well for our continued clinic expansion and sales growth. Turning to slide eight, let's discuss marketing. In March, we are pleased to attract a record number of new patients in our system. This was 11% greater than our previous system high, which was in March. This is a significant development as the average number of new patients was the metric most negatively impacted by the pandemic and is a key ingredient for our growth of our membership model.

Many factors are driving our momentum from easing of COVID related restrictions by local government to increases in local advertising spending by our franchisees to continued success of our brand building efforts to the growing market strength of our regional co ops and the innovations in our marketing technology platforms. In addition to new patient records, we also rolled out a new grand opening program for our clinics in Q1 twenty twenty one, strengthening awareness marketing, enhancing our digital tactics and lead nurturing as well as refreshing our advertising and sign our clinic signage. During 2020, our average clinic breakeven sales levels was reached within six months of operation. We expect the program to further strengthen our new clinic sales ramps, while also enabling us to scale better with our accelerated pace of expansion. Turning to slide nine, let's review AXIS, our new IT platform.

Access continues to be the most important initiative of the year and I'm excited to say that we're getting closer to delivering version one point zero. Initially, it will be a lift and shift, meaning that the first version we're simply replicating the functionality of our current system. Once that conversion is complete and we're established on this powerful new SugarCRM platform, it ultimately will provide an improved point of purchase systems, financial systems, business intelligence, marketing automation and patient feedback capabilities among many other features. We're now focused on training heavy users and finalizing our due diligence to minimize system disruptions on the rollout. It's essential that this new platform be fully tested and that every franchisee is prepared for acceptance of the new system.

We will complete this crucial project as we complete this crucial project, we will not jeopardize it by rushing or shortcutting the process to meet an artificial timeline. We continue to target summer twenty twenty one for our formal rollout. And with that Jake, I'll turn it over to you.

Speaker 3

Thank you, Peter. Turning to slide 10, comparing first quarter twenty twenty one to first quarter twenty twenty. System wide sales for all clinics open for any amount of time increased to $77,800,000 up 28% year over year. System wide comp sales for all clinics opened thirteen months or more or twenty one percent compared to 15% in the prior year. System wide comp sales for mature clinics opened forty eight months or more were 14% compared to 10% in the prior year.

Revenue was $17,500,000 up $3,900,000 or 29 percent. Company owned or managed clinics contributed revenue of $9,500,000 increasing 30% from the same period a year ago. Franchise operations contributed 8,100,000.0 Cost of revenue was $2,800,000 up 19% over the same period last year, reflecting the increase in franchises that resulted in higher RD royalties and commissions. Selling and marketing expenses were $2,500,000 up 21% over the same period last year, driven by an increase in advertising fund expenditures from a larger franchise base and an increase in local marketing expenditures by the company owned or managed clinics. G and A expenses were $10,100,000 compared to $8,700,000 The $1,400,000 increase was primarily due to higher payroll and related expenses as we scale our infrastructure for rapid growth.

G and A as a percentage of revenue in Q1 twenty twenty one was 57%, down from 64% in Q1 twenty twenty, reflecting improved leverage of our operating model. Given the slower pace of greenfield development in Q1, we believe it represents a proxy for mature operating system. However, with our planned accelerated greenfield openings, we do not expect the same level of operating leverage over the next several quarters. Operating income was $2,000,000 compared to $753,000 in 2020. Income tax benefit was $364,000 compared to $66,000 in the prior year.

The income tax benefit was primarily driven by excess tax benefits from the exercise of stock options. Net income was $2,300,000 or $0.16 per diluted share compared to $815,000 or $06 per diluted share in the first quarter of twenty twenty. We delivered total adjusted EBITDA of $3,500,000 which increased 108% compared to the same period last year. Franchise clinic adjusted EBITDA increased 35% to $3,900,000 Company owned or managed clinic adjusted EBITDA increased 84% to $2,500,000 Corporate expense as a component of adjusted EBITDA loss increased 13% to $2,900,000 reflecting our infrastructure investment as we scale for growth. At 03/31/2021, our unrestricted cash was $17,800,000 compared to $20,600,000 at 12/31/2020.

During the quarter, we voluntarily repaid our $2,700,000 PPP loan and invested 2,300,000 in corporate expansion, including $1,400,000 for the January RD territory repurchase and $900,000 in greenfield development and IT capital expenditures. This was offset by cash inflows from operating activities of $2,300,000 On to slide 11 to review our guidance for 2021. On the strength of our Q1 performance, we're increasing our revenue expectations to be between $73,500,000 and $77,500,000 compared to $58,700,000 in 2020. Due to the delay in Greenfield clinic openings and their related earnings suppression, our Q1 twenty twenty one adjusted EBITDA was higher than originally expected. Therefore, we're raising our 2021 adjusted EBITDA guidance to be between 11,000,000 and $12,500,000 compared to $9,100,000 in 2020.

We continue to expect franchise clinic openings to be between 8,100 compared to 70 in 2020. We continue to expect company owned or managed clinic increases through a combination of both greenfields and acquisitions of franchise clinics to be between twenty and thirty compared to four in 2020. We will continue to evaluate acquisitions opportunistically. However, we will prioritize growth through greenfield and franchise clinic openings as we drive towards our goal of 1,000 clinics opened by the end of twenty twenty three. We are building Greenfield strategically located within our clusters and in new markets.

We now expect to accelerate openings in late Q2 and Q3 supported by the fact that we currently have 20 signed leases. Consequently, we expect increased corporate expenses and suppressed total company earnings during the remainder of 2021. However, we're quite confident that the greenfields will be accretive in the long run. I will now turn the call back over to you Peter.

Speaker 2

Thanks, Jake. Turning to slide 12. As discussed, we're investing in our future. We'll make decisions that impact our short term profitability in favor for long term growth like increasing greenfield clinics that expand our market position and brand awareness. In April, we're pleased to welcome Mark Miller into the newly created position of Vice President of Real Estate and Construction.

Mark is a proven leader with more than thirty years of experience accelerating unit growth Fortune 500 companies and industry leaders such as Panda Restaurant Group, CVS and McDonald's. Mark will work closely with our Vice President of Franchise Sales and Development to bring additional expertise and horsepower to our already talented development team as we march toward our goal of reaching 1,000 units in operation by the end of twenty twenty three. Speaking of this goal, we believe that this is the only the starting point for our new phase of development, our next phase of development. 1,000 clinics is a known tipping point for franchise systems in achieving national brand awareness. At that scale of that magnitude, we can more easily and effectively leverage our brand, marketing and operational infrastructure, which we expect to drive growth at an even faster pace.

This model of accelerated expansion has been proven repeatedly by household name franchise systems operating in that small box retail space of approximately 1,000 square feet. The power of franchising that it brings together like minded people to build a brand. It drives faster expansion. It increases market awareness and education and accelerated innovation. Looking ahead, we have a map that identifies more than 1,800 clinic targets based on the analysis of actual patient demographic and psychographics.

To be clear, this is just the tip of the iceberg. Only 50% of The U. S. Population knows what chiropractic care is, yet there's over 41,000 private practitioners in The U. S.

Today, making this group both our largest competitor and most significant part of our hiring base. In a similar healthcare market, dental service organizations represent 12% of their field, whereas we estimate the joint accounts for only 1% of the chiropractic care market today and all chains including franchise systems account for only 3% of market share. Naturally, our success has spawned copycats, which is an expected evolution in the growth of any attractive and emerging category. To combat the competition, we leverage our first mover advantage as every new clinic strengthens our brand. We support our RDs and franchisees as they blaze new trails in new markets.

We grow and nurture our marketing co ops as they leverage their collective spend in their region. We secure the best sites and trade areas. We recruit and retain the best as we strive to be the employer brand of choice for doctors of chiropractic. Ultimately, we provide the best patient experience delivering on our brand pillars of accessibility, credibility and empathy. Turning to slide 13.

Our model carries tremendous beauty and power in its simplicity and focus. We continue to expand faster than the chiropractic market as a whole as evidenced by our ten year CAGR of seventy percent and the fact that twenty seven percent of our new patients who visited The Joint in 2020 had never seen a chiropractor before. Chiropractic Care truly is an essential health care service. I'm so grateful for our entire system, our doctors, our wellness coordinators, franchisees, regional developers and corporate staff for their dedication to our mission of improving quality of life for our patients. With that Rachel, I'm ready to begin the Q and A.

Speaker 0

Thank you, Peter. Our first question comes from the line of Frank Takinen from Lake Street Capital. Sir, your line is open.

Speaker 4

Great. Thanks for taking my question and congrats on another good quarter.

Speaker 3

Thanks, Frank.

Speaker 2

Thanks, Frank.

Speaker 4

Absolutely. So starting with the increased commentary beyond 1,000 being just the starting point to the growth of The Joint over time. Can you just bring us a little deeper into how you're thinking about how this could unfold over the next three to five years after you hit that twenty twenty three one thousand clinic mark? And just given your experience in getting clinics to this 1,000 tipping point explain the importance of that and how you expect to accelerate growth from there when the base will be getting very large from that point forward?

Speaker 2

Frank, those are two very great questions. I'll take the second question first and that's in terms of how do we expect to see that expansion when we're already moving so quickly. And I would say the answer is the market itself is growing. As I mentioned on the call that twenty seven percent of all of the patients who opened the door for the very first time to The Joint last year had never seen a chiropractor before. So this isn't simply trading off market share.

So we know it's roughly a $16,000,000,000 market and we know we have roughly 1% of that market. What we're doing is redefining the market. We're expanding the market which is absolutely one of the most important parts of that accelerated growth. Yes, we know we can get to 1,000 units. And why 1,000 units is so important is that this is in that small box retail space.

We're not a Procter and Gamble. I don't have $100,000,000 to get you to change your toothpaste. What I have as in those other small box retail concepts is that we have storefronts. And with that storefronts, we educate our consumer to open that door for the first time and wow this is a really interesting service. I'm going to use it.

Oh my gosh, I'll tell my friends, I'll continue to use it. And you see that expand. So it's those storefronts that becomes one of the most powerful accelerators of the growth of this business or the building of that brand. That's why there's such a focus on getting those units out and open. And if you look at our growth patterns is where do you see most of our new growth coming from?

From our existing markets. Because what happens is and this again that space where you've got your customers coming in, they love your product and service and they're like, my gosh, this is amazing. Are you franchised? Why not? So some of the leads that we get for the new franchisees come direct from being patients of our clinics.

So as you have more clinics out there and you have more patients out there, have more leads who are interested in growing and you have a market that is only expanding. You can't have these incredible comps that are purely organically grown. So we just reported 21% comps in Q1 twenty twenty one with mature units at that over forty eight months doing 14%. You can't have that kind of growth if you don't have an extraordinarily expanding market.

Speaker 4

That's great. And then on my second question, just wanted to ask about the guidance a little bit more specifically. Given your previous years of seasonality excluding 2020 due to COVID, there's been this cadence of a building throughout the year at a likely strong quarter in Q4 with normally a pretty sizable bolus of open new franchise openings. So I wanted to ask just if there was an extra layer of conservatism built into the number here given the strong start at $17,500,000 for Q1. So is there anything you're seeing that's given you a little bit more conservatism here?

Or is it just purely keep it prudent and conservative and continue your beat and raise mentality?

Speaker 2

Well, Frank you've spent enough time around us. We're going to be thoughtful about the numbers we put out there and that yes, that we've had a remarkable response to the pandemic, but we still are in the middle of the pandemic and there's things that are out there that could happen that we're not anticipating at this point. And so that we're thoughtful. As we said, we're increasing our guidance both on the adjusted EBITDA and on the gross sales. You're right to expect that typically we have a much stronger fourth quarter than we do any other quarter.

You're right that we saw it more times than not that our growth comes from new franchise sales more in the second half of the year than the first half of the year. So I mean we really are anticipating those to continue to influence where we go, but we want to be really thoughtful about that.

Speaker 4

Perfect. Thanks for taking my questions. Congrats on another good quarter.

Speaker 5

Thank you. Thank

Speaker 0

you. Our next question comes from the line of Jeff Van Sinderen from B. Riley. Sir, your line is open.

Speaker 6

Hi, everyone. And let me add my congratulations on your strong metrics. It's great to see.

Speaker 2

Thank you,

Speaker 6

I guess my first it's kind of a multi part question if you guys can bear with me, but and understand that some of this is a little tough to parse out. But can you speak more about what you're seeing in markets that have broadly reopened more recently versus markets that reopened earlier? And in general, how much tailwind do you think you're getting from people being vaccinated and also from stimulus checks if at all? Just wondering on those things.

Speaker 2

It's an interesting question. And I would tell you that one of the things that has been so significant as we look at our experience through the pandemic and where we are today and obviously it's we're making great inroads through the use of vaccines, but it's not over is how little the markets have been impacted by whether it was a market that was wide open or a market that was shut down. So we've got a lot of clinics in California for example, has been one of the more shutdown markets. We have a lot of clinics in Texas, in Florida and in Atlanta or in Georgia, which has been more open markets. And when we look at that and try to compare, okay, did one move faster than the other, it's shockingly consistent across all those markets.

Now the one market where I'd say that we really did see a significant impact just separate from almost any other place that we were, we talked about this before and that was market. And in Colorado unlike in any other market that we faced as part of the Governor's directive was that you in order to protect PPE, they didn't they wanted any medical service being shut down that was not providing acute care. And so that they part of their directive was that we were shut down for I think seventeen days and then they came back with an additional directive that said okay you can open but only on an appointment basis. And so that had a significant impact on those 28 clinics in the Colorado market. That directive has now been changed and so that we are back to a non appointment basis in Colorado.

But if I'm looking across the country and trying to understand what are the factors that have influenced the performance of the clinics? And is there a regional variance or cadence to that is I would say not very distinguishable outside of the Colorado market.

Speaker 6

Okay. That's helpful. And then just turning to the eight clinics that you just bought. I guess I'm wondering are you do you feel like there's an increasing probability that more potential deals like that will come to the table? Or were the six units in North Carolina somewhat more a function of having bought back the RD rights for that territory?

Just wondering how you're thinking about that?

Speaker 3

Sure. Jeff, it's a good question. I think it absolutely by buying back the North Carolina territory it created that opportunity. But we look at those acquisitions as being an opportunistic part of our strategy. We do hold the right of first refusal.

So if any clinics are changing hands or prospectively changing hands, we have the right to look at that deal. In the case of North Carolina, was an opportunity that came across at the right valuation and we capitalized on that. So I think that still remains an opportunistic strategy. If I acquire a unit, it doesn't add a net positive unit to my unit growth total, right? So that's why I think we're still strategically focused on opening the greenfields, supporting our franchisees and RDs as they open their units to try to reach that scale and that 1,000 unit goal.

Speaker 6

Okay. Thanks for taking my questions and continued success.

Speaker 2

Thank you very much.

Speaker 0

Thank you. Our next question comes from the line of Anthony Vendetti from Maxim Group. Sir, your line is open.

Speaker 5

Thanks. Just on that follow-up on the 1,000 clinic goal, is the cadence pretty much equal throughout these next couple of years? It looks like it's probably going to accelerate. And then what's the breakout likely to be in terms of franchise versus corporate owned?

Speaker 2

Hey, Anthony. Two great questions. And I would say absolutely there's an expectation of acceleration. And certainly in the thirty plus years I've been building and managing franchise systems that is a very common experience. Because again as I was talking earlier on one of the questions is that it builds upon itself.

As you have more units out there, you have more exposure, you have more interest in the franchise as the market is expanding. And so that you absolutely see this accelerated year over year over year. I would have expected us to have a much higher acceleration in 2020 if we had not had the pandemic. If you look at our numbers, so we sold 37 clinics in 2017. We sold 99 in 2018.

We sold 126 in 2019. And I would have expected that just to continue to go forward if we weren't hit by the pandemic. But even in that pandemic, hit we 121 sales. And so obviously with the numbers that we're posting you can do the math. We're sitting here at 600 units.

We've got until 2023 to say we're going get 1,000 units open. You can do it evenly and say okay this is the number you have each year. But the way I would look at is absolutely year by year we'll see an acceleration of the number of those units opening. To your question about the mix is that right now as you know we're at 89% franchise 11% corporate. With the speed of the franchise system growing, it's going to be hard to push that number too hard, too much harder the corporate side of it large without doing an acceleration of the corporate greenfields.

As we've talked on the call today, as we expect to see an increase from what we've done in the past that I think you can see in the numbers that we're getting better and better in running those corporate clinics. And by being better and better running those corporate clinics, there's a greater interest in getting more of them out in the field. But we've given really broad ranges when we talk about what will that percentage be. And I've said somewhere between that let's say 1025%. And so I know that's not real helpful for modeling, but I think that's a reasonable range to be thinking through is okay what is that corporate clinic growth going to look like in the 1,000 units.

Speaker 5

Okay. No, no, that's helpful. And then obviously this is a big undertaking switching out your IT services. And I think you mentioned Peter that expected to be complete by June?

Speaker 2

Well, said

Speaker 5

summer. Summer, okay. Sorry. Summer, summer. But okay, so maybe July, August.

IT issues sometimes take longer just like construction unless you have a very well oiled machine like you guys have at this point. But if we look at the advantages of this, what metrics are you looking at that the practices or the clinics are going to see? What's the overall benefit?

Speaker 2

Well, it's a great question and I think it's one that changes over time. As I said on the call, this initially is a lift and shift. So the impact I expect to have in the benefits, there are certain benefits that are getting built in, in that first version. But the reality of it is, all that we're trying to do is to take our homegrown platform and put it on this new platform and retain all of the functionality that we have. But on that new platform, then as we grow and build and improve it, there's a whole set of things that we can do that we are not able to accomplish in on our current homegrown platform.

And they have they are they ultimately Anthony affect every aspect of the business. I mean a really simple one. One of the first things we want to do is get a mobile check-in out there. We don't I mean it's just we're so behind by not having that in place today and we haven't had the platform that allowed us to do it, but we will. Now that's not going to come out in summer, but that will be one of the top priorities going forward creating a patient portal.

This whole issue if you look at the twenty first Century is this marketing to you as an individual we can access who you are and target what you want or what your issues are and craft a message to you which improves the ability to your whole marketing strategy in a way that we've never had access before. I've always thought that this concept one of the most powerful assets we have is our data. And on this new platform it allows us to do so many things with that data that we simply can't do until we get to that newer platform. But these are all things coming down the road. This is Access one point zero.

And so I don't want you to get ahead of ourselves. I know that this absolutely creates the foundation that propels us into that twenty first century, but we've got to get through this lift and shift first.

Speaker 5

Okay. Sounds great. I'll turn it back to the queue. Thank you.

Speaker 0

Thank you. Our next question comes from the line of Jeff Geiser from Geiser Wealth Management. Please go ahead.

Speaker 7

Hey, Great quarter. Just one quick question. Is striving for the goal of $1,000 in 2023 the same as reaffirming guidance for $1,000

Speaker 2

Yes, it is. I mean we're striving. But yes, we're putting it out there because we believe that we can

Speaker 7

Great. Well, I can't think of two other people I'd rather have at the helm. Great Board, great management. Thanks so much for being great stewards of my clients' capital.

Speaker 2

Thanks a lot, Jeff. We appreciate the support.

Speaker 5

We'll talk with you soon.

Speaker 0

Thank you. There are no lines for question in queue. I'm now turning the call

Speaker 1

back to Peter Hall. Sir, please go ahead.

Speaker 2

Thank you all for your time today. Please note that on June 2, we plan to participate virtually in the Craig Hallumannual Conference. Each quarter I close with a patient story. And this one reminds and educates us that so often pain felt in one part of our body is actually caused by an issue in another part. A patient from Phoenix wrote and I quote, I woke up and I work at a computer all day.

I started noticing pain in my upper arm and was having trouble lifting my arms. One morning I woke up in excruciating pain and could literally could not lift either of my arms. I was in tears and couldn't go to work. My daughter had been going to The Joint and was very happy with her treatment, so I decided to give it a try. My doctor was so comforting and kind.

He took the time to go over all of my symptoms and areas of pain. I truly thought that I was having a problem with my back and turned out to be my neck. We set up a plan that worked for my schedule and after every visit I feel better. The pain in my arms went away and I can lift them without any problem and my mobility has come a long way. I can't thank my doctor or not.

Thank you and stay well adjusted.

Speaker 0

This concludes today's conference call. Thank you for participating. You may now disconnect.