Welcome to The Joint Corp. second quarter 2022 financial results conference call. All participants will be in a listen-only mode. Should you need any assistance, please dial a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press the star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to David Barnard with LHA Investor Relations. Please go ahead. Thank you, Victoria. Good afternoon, everyone. This is David Barnard of LHA Investor Relations. On the call today, President and CEO Peter Holt will review our second quarter 2022 performance metrics and provide an update on the business. CFO Jake Singleton will detail our financial results and guidance. 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 https://ir.thejoint.com under Events. Today, after the close of the market, The Joint Corporation issued its financial results for the quarter ended June 30, 2022. 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-19 outbreak on the economy and our operations, including temporary clinic closures, shortened business hours, and reduced patient demand, inflation exacerbated by COVID-19 and the current war in Ukraine, 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, our inability to identify and recruit enough qualified chiropractors and other personnel to staff our clinics, due in part to the nationwide labor shortage, 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 the current or future material weaknesses in our internal controls 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 for the year ended December 31, 2021, filed with the SEC on March 14, 2022, and subsequently filed current and quarterly reports. 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 or net gain or loss on disposition or impairment, and stock-based compensation expenses. Management also includes commonly discussed performance metrics. System-wide sales include revenues at all clinics, whether operated by the company or by franchisees. While franchise 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 franchise base. Comp sales include the revenues from both company-owned or managed clinics and franchise clinics that, in each case, have been open at least 13 full months and exclude any clinics that have closed. Turning to slide three, it is now my pleasure to turn the call over to Peter Holt. Thank you, David, and I welcome everybody to the call. During the second quarter of 2022, our growth momentum continued. Before I go into greater detail, I'd like to welcome our new and returning investors in addition to our existing shareholders. As you know, The Joint is revolutionizing access to chiropractic care by providing affordable, concierge-style, membership-based service in convenient retail setting. We've had a huge addressable market in both size and opportunity. First, The Joint accounts for only 2% of nearly $18 billion spent annually in the United States on chiropractic care. Next, our system provides the most robust environment for chiropractic clinics to excel financially, demonstrated by our research comparing average collections of independent practices to average sales of our clinics in our network. In addition to our strong unit economics, our hybrid business model continues to position us for long-term growth. Our corporate clinics will drive long-term bottom-line improvement. Our franchisees will continue to fuel our expansion in a capital-light fashion. As we increase our scale and presence, bringing us closer to our interim goal of 1,000 clinics, our national brand awareness also increases, adding further momentum to our expansion. That said, it's important to reiterate our commitment to responsible growth, which means our highest priority remains maintaining our high standards in providing quality patient care. To that end, we closely monitor clinic performance. As discussed during our Q1 2022 earnings call, with the large influx of greenfield openings in late 2021, coupled now with our managing a portfolio of over 100 units, we experienced a temporary negative impact on our corporate clinic portfolio, and we took swift action. We've sharpened our focus on supporting our doctors of chiropractic and our Wellness coordinators, and we've strengthened our oversight of our corporate units. As a result, we delivered improved Q2 2022 clinic performance compared to Q1 2022. Turning to slide 4, I'd like to review our financial highlights for Q2 2022 metrics compared to Q2 2021. Jake will discuss our results in greater detail in a moment. System-wide sales grew to $106 million, increasing 21%. Our comp sales for clinics that have been open for at least 13 full months grew to 8%. Revenue increased 24%. Adjusted EBITDA was $2.6 million. At the end of June 30, 2022, our unrestricted cash was $9.4 million compared to $19.5 million on December 31, 2021, reflecting our strategy of investing in our corporate clinic portfolio as well as our acquisition of regional developer territory rights. Turning to slide 5, again, Q2 performance improved compared to Q1 2022. It also compared well to Q2 2021, especially when taking into consideration that quarter delivered record-breaking performance due to an exceptional rebound from COVID and capture of pent-up demand in both clinic openings and franchise license sales. Regarding clinic expansion, during Q2 2022, we opened 34 clinics, up from 31 clinics in Q1 2022. Of the 34 opened in Q2, 3three were greenfield clinics and 31 were franchise clinics. Also, during Q2, 1 franchise clinic closed, compared to none in Q2 2021. The Joint continues to have very low clinic closure rates as less than 1% annually. In Q2, consistent with our growth strategy, we opened three greenfield clinics in Arizona, Virginia, and New Mexico, which have increased our presence in existing corporate clusters. Year to date in 2022, we opened 65 clinics, 58 franchises, and 7seven greenfields. This compares to 54 openings in the first six months of 2021 that consisted of 48 franchises and six greenfields. Also in May, we acquired 4 previously franchised clinics. A multi-unit franchisee with clinics in both Arizona and California wanted to consolidate their clinic ownership to California, thus creating the opportunity for us to buy their high-performing mature clinics in Arizona. This expanded our headquartered region cluster to 24. Easily incorporated into the portfolio, these clinics improved our corporate clinic operating margin and were immediately accretive to our bottom line. The purchase price of $5.8 million reflected the strength of these clinics and was in line with previous acquisition valuations. In summary, at June 30, 2022, we had 769 clinics in operation consisting of 662 franchise clinics and 107 company-owned or managed clinics, maintaining a portfolio mix of 14% corporate clinics to 86% franchise clinics. At the end of the quarter, we also had 270 franchise licenses in active development compared to 283 on December 31, 2021. This metric continues to demonstrate the strong pipeline for franchise clinic openings and reflects both the accelerated number of franchise openings as well as ongoing increased interest in our franchise system. Subsequent to quarter end, we have completed several more transactions that built upon our clustered location strategy. We acquired three previously franchised clinics in North Carolina and 1 clinic in Scottsdale, Arizona. We also opened up one greenfield clinic in California and our first two greenfield clinics in Kansas City, which is a new market for us, where we expect to expand to at least five clinics in a relatively short period. This increased our corporate portfolio to 114 clinics as of August 4, 2022. Turning to slide six, in Q2 2022, we sold 24 franchise licenses, up from 22 licenses in Q1 2022, compared to 63 in Q2 2021. Year to date, 2022, 46 licenses were sold, 67% by regional developers. This compares to 89 licenses sold in the first six months of 2021. As of June 30, we had 19 RDs supporting 67% of our franchise clinics. Their territories covered 55% of the metropolitan statistical areas or MSAs. The aggregate ten-year minimum development schedule for our new RD territories established since 2017 was 640 clinics as of June 30. Keep in mind that a portion of this clinic count is already opened, but the remaining unopened clinics still provide a large foundation to fuel our continued clinic expansion and sales growth. Our RD program continues to deliver accelerated expansion. However, under certain circumstances and when territories mature, we'll acquire RD territories. In April, we purchased the rights for Northern California for $2.4 million. Our model indicates that the region has a potential for 75 clinics. Already, 20 franchise clinics are in operation, and 36 sold licenses are in active development. This leaves room for another 19 sites for future corporate or franchise clinic development. In May, we hosted our national franchise conference with the theme Align '22. During this well-attended event, we aligned our strategies and our tactics, celebrated our successes and culture, shared our latest research, listened to inspiring industry and business visionaries, and continued developing the future leaders of our growing chiropractic movement. There were multiple noteworthy takeaways, and I'll share some of the compelling research that we reviewed during that event. Turning to slide seven. According to FRANdata, which analyzes the franchise landscape, of approximately 3,500 franchise businesses in the United States today, only 4.9% have more than 500 units. Even more notably, only 94 brands, approximately 2.7%, have grown to over 1,000 units and benefit from the significant brand awareness that creates. According to the 2022 Essential Guide to Pricing Businesses and Franchises, The Joint is an elite franchise system, and based on analysis of the franchise unit sales price, our clinics garner higher valuations than the majority of franchise concepts, further enhancing the attractiveness of our franchise offering. Turning to slide eight. We also evaluated data from the annual Chiropractic Economics Compensation Survey, comparing two alternatives available to chiropractors, becoming an independent practice or joining our franchise concept. According to the survey, the average independent practitioner collected about $264,000 per clinic in 2021. By comparison, in 2021, the average gross sales per clinic of The Joint was 2.3 times greater at almost $600,000. Further, the study in the data from 2017 to 2022, independent clinics' billings decreased 14% and collections decreased 11%, while the average gross sales per Joint clinic grew 76%. Turning to slide nine. During our national conference, we were also presenting awards to our high-performing clinics. The number of 2021 bronze, silver, gold, platinum, and diamond honorees grew markedly over 2020. In 2021, 308 clinics achieved sales greater than $550,000 or up 82% from the 169 clinics of 2020. That included 41 platinum clinics with over $1 million in sales, more than four times higher than the nine platinum clinics in 2020. Finally, in 2021, we doubled our diamond category as a second clinic achieved a remarkable milestone of over $1.5 million in sales for the year. This unit volume increase success continues to attract more sophisticated franchisees and the positive cycle repeats itself. It also illustrates that our clinics have more room to expand their patient base, creating additional clinic value as well as overall enterprise value. Turning to slide ten, let's review our marketing efforts. In Q2, we continued to leverage our growing scale and resources by investing in brand building and lead generation at the national, regional, and local levels. This tiered approach provides clinics with a degree of marketing support and sophistication that is unprecedented in chiropractic. It also enables us to test tactics before they're added to the toolkit for individual clinics. Nationally, we're consistent advertisers on multiple digital marketing platforms. Regionally, we made many of our co-ops invest in broadcast media and support sponsorships, such as our June announcements with the Norfolk Tides, a minor league baseball team. Locally, our clinics nurture prospects within their own trade areas by utilizing our proven local marketing tactics. This support, combined with the power of our data from millions of patient transactions, provides clinics with a significant competitive advantage in attracting new patients. Another facet in the development and management of our online marketing strategy, which is essential for reaching Millennial and Gen Z consumers seeking solution for pain relief. One challenge we navigate is adapting to Google's frequent changes in their search algorithms, which can impact our online visibility. Such a change occurred in late 2021 and continued to negatively impact our organic search traffic into Q2. While our new patient acquisition remains exceptionally high when compared to historic levels, we've been implementing changes to our search engine optimization activities across the network. As a result, our July online traffic improved, which indicates our new patient acquisition pipeline is increasing. In June, we executed our annual summer sale direct marketing promotion, where we targeted lapsed patients with a limited time offer to restart their membership with The Joint. We achieved the highest number of conversions per clinic and our highest ever conversion rate as the promotion with a five-year history. The success of the summer sale once again demonstrates the potential growth in marketing to our own database as well as the progression of our digital marketing tactics, which we expect to further leverage with the harness of the power of our data enterprise initiative. With that, Jake, I'll turn it over to you. Thank you, Peter. Turning to slide eleven. I'll review the financial results for Q2 2022 compared to Q2 2021, which as Peter mentioned, was a record-breaking quarter benefiting from demand built up during the early part of the pandemic. System-wide sales for all clinics open for any amount of time increased to $106 million, up 21%. System-wide comp sales for all clinics open 13 months or more were 8%. System-wide comp sales for mature clinics open 48 months or more were 3%. It's worth noting that both the franchise and corporate clinic cohorts comped positively, and we look forward to growth as the impact of our price increase continues to come into effect. Revenue was $25.1 million, up $4.8 million or 24%. Company-owned or managed clinic revenue increased 27%, contributing $14.5 million. Franchise operations increased 20%, contributing $10.6 million. The increases represent growth in both the corporate portfolio and the franchise base. On March first, we implemented a price increase in the majority of our clinics. However, existing patient memberships are currently grandfathered at their original price. Therefore, the revenue impact from the price adjustment will be gradual and incremental. Cost of revenues was $2.4 million, up 19% over the same period last year, reflecting the increase in franchise clinics, the associated higher regional developer royalties and commissions, and higher website hosting costs related to the new IT platform. Selling and marketing expenses were $3.8 million, up 23% 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. Depreciation and amortization expenses increased compared to the prior year period, primarily due to the depreciation expenses associated with our new IT platform and continued greenfield development. G&A expenses were $16.5 million compared to $11.6 million, up 42%, reflecting the cost to support total clinic and revenue growth, greater IT expenses, higher payroll, including the increase in salaries for DCs, which began in the latter half of 2021, and for Wellness Coordinators, which continued through the second quarter of 2022, all these to remain competitive in the tight labor market. As noted previously, our pace of greenfield openings will increase G&A as a percentage of revenue over the next several quarters and will also compress earnings. As a result, we reported an operating income of $473 thousand, which reflects the compressed margins from accelerated greenfield development, the aforementioned higher depreciation, and higher G&A expenses. This compares to $2 million in Q2 2021. Income tax expense was $109 thousand compared to a benefit of $666 thousand in Q2 2021. Net income was $345 thousand or $0.02 per diluted share compared to net income of $2.7 million or $0.18 per diluted share in Q2 of 2021. Adjusted EBITDA was $2.6 million compared to $3.8 million for the same period last year. Franchise clinic Adjusted EBITDA increased 13% to $4.4 million. Company-owned or managed clinic Adjusted EBITDA was $1.8 million. While the Q2 2022 margin for corporate clinics has improved over the Q1 2022, compared to Q2 of last year, it decreased $1.2 million, reflecting the margin compression related to the greenfield development and higher payroll expenses. Corporate expense as a component of Adjusted EBITDA loss was $3.6 million, increasing $433,000 compared to Q2 2021. On to our balance sheet and cash flow review. At June 30, 2022, our unrestricted cash was $9.4 million compared to $19.5 million at December 31, 2021. During the first half of the year, our investing activities of $11.4 million consisted of the acquisition of RD territory rights, franchise clinic acquisitions, and continued greenfield developments, which were partially offset by $1.5 million provided by operating activities. On to slide 12. I'll review our results for this first 6 months of 2022 compared to the same period in 2021. Revenue increased 26% to $47.5 million, and Adjusted EBITDA was $4.4 million compared to $7.2 million in the prior year period, reflecting the compression of earnings by the influx of new corporate greenfield clinics and higher payroll expenses associated with the tight labor market. On to slide 13. We are reaffirming all elements of our guidance for 2022. We continue to expect revenue to be between $98 million and $102 million. The midpoint is up 24% compared to the $80.9 million in 2021. We continue to expect adjusted EBITDA to be between $12 million and $14 million compared to $12.6 million in 2021. We continue to expect franchise clinic openings to be between 110 and 130 compared to 110 in 2021. We continue to expect to increase our company-owned or managed clinics by between 30 and 40 through a combination of greenfield openings and franchise clinic purchases. This compares to 32 in 2021. With that, I'll turn the call back over to you, Peter. Thanks, Jake. Turning to slide 14. As noted, our hybrid business model has supported our long-term growth through various market cycles, and our momentum continues as demonstrated by our performance. Even though we're all experiencing macroeconomic issues outside of our control, we continue to focus on what we can manage. For 2022, our three enterprise initiatives are to forge the chiropractic dream, harness the power of our data, and accelerate the pace of our clinic growth. With an eye for long-term benefits, we are implementing these independent programs simultaneously. First, we wanna become the career path of choice for DCs while we're improving our team members' experience by enhancing their culture and providing training and benefits and increased compensation. Forging the chiropractic dream will help us differentiate ourselves as an employer in a very tight labor market. We're distributing new recruitment materials and evangelizing our system. Our team is also deepening our relationships with chiropractic universities and associations to educate current and future DCs. To date, we are excited about the reception inroads we're making in this crucial area. Next, we wanna make sure our information is more accessible and actionable by decision-makers by harnessing the power of our data. This includes development of a data warehouse to enable more real-time, self-serve reporting of capabilities at the corporate office and in the field. This also includes advancement in marketing automation and development of our mobile app for direct patient engagement. Finally, we wanna increase our long-term return on investment for franchisees, employees, and shareholders by accelerating the pace of our clinic growth. As emphasized in my earlier comments, we are committed to responsible growth and closely monitoring the system to ensure we uphold our clinic performance standards. We can implement tactics to support this expansion by shortening our clinic development timeline, enhancing regional support, evaluating nontraditional site options, including rural, urban, micro, military, and even international locations, and increasing national brand awareness. Turning to slide 15, I'm confident in our ability to drive long-term growth and stakeholder value. Victoria, I'm ready to turn it over for Q&A. Thank you. We will now begin the question-and-answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, press star then two. At this time, we will pause momentarily to assemble our roster. The first question comes from Jeremy Hamblin with Craig-Hallum Capital Group. Please go ahead. Thanks for taking the questions. I wanted to start with a comment you made about you know kind of Google Search traffic data and improvement on your algorithms and your working with the changes in their service. I think you noted that you saw an improvement in July inbound traffic into your website over the last several months. You know, how would you characterize that? Would you say, you know, kind of maybe March was kind of the low point in that, and you've seen continuous improvement, or are you seeing something, you know, more specific to let's say the last 30-45 days? Well, when we look at this, Jeremy, thank you for the question, and we all know how important our digital marketing campaign is to our new patient count. As we talked about on the last quarter, is that we can identify that at least 63% of our new patients at some point touch our digital marketing campaign. It's obviously really critical for us as we go forward. We did, as we talked about in Q1, is with the algorithmic change, we saw a drop, particularly in our organic search of new patients. We have made adjustments to how we are managing that process literally on the line level, so that we're upgrading our microsites. We're enhancing the bios of our doctors. We're putting back links on those sites. All these different SEO strategies that you utilize to increase your standing when that patient or potential patient is doing their search. What we saw was that, particularly in the month of July, you know, 'cause we were probably down compared to last year, around 20%, with this impact. When we look at July was where we really saw that significantly increasing. We haven't hit where we were last year, but we're believing that the changes that we're making, working through our franchise system, that we are in fact seeing an increase now in that digital, you know, lead of our potential patients. Okay, great. That's helpful. Understanding the kind of margins here, right? You're gonna continue to see, you know, G&A costs that are higher, sales and marketing costs that are higher. You know, some of the acquisitions that you've made over the last, you know, four or five months. I think you noted or how you characterized it on the call was that it would be several quarters in which you would see margin headwind and G&A deleverage. You know, with you know, the benefit now of being more than halfway through 2022, do you have a better sense of when you think that you know, inflection or that headwind might you know, kind of bottom out and you start to see margins or in particular G&A start to inflect positively and gain some leverage? Yeah, another good question, Jeremy. I think it's really dependent on the cadence of our greenfield development. You know, when you put in, you know, 13, 14 clinics in the last 100 days of 2021, you're gonna have a very significant suppression, you know, in the quarters where they're, you know, still in their working capital loss period. I think it's somewhat dependent on the pace of our greenfield development. I think you've seen in the first couple quarters that that pace, you know, has softened from what we saw at the back half of 2021. In turn, you're seeing, you know, the clinics continue to mature, and you're seeing those margins expand, which is exactly kinda what we would expect as they go on to mature and reach those break-even points. You know, as we mentioned in previous calls and continue to see, you know, the clinics are still starting strong, and they're performing to what we would expect from a pro forma ramp perspective. I think part of that in terms of, you know, when the potential nadir would be, is really dependent on the pace of development. You know, we're gonna continue to invest in greenfields, but to do that many in a short period of time, you know, I don't know if we'll get back to that pace. Again, that's really what drives the compression. You know, in clarifying the comment, you know. The more we do greenfield development, you'll continue to see those early period losses compress margins. It's really dependent on the cadence, I think, in terms of where you might see that bottom out. I think Q2 is a good example of when the pace moderates, you can see that margin expansion start to come back. Getting to your $12 million-$14 million of Adjusted EBITDA guidance for the year, you know, would imply that you're gonna, you know, generate at least $7.5 million, you know, and up to, you know, nearly $10 million in Adjusted EBITDA in the back half of the year, which would require, you know, kind of a margin improvement in the back half of the year. You know, in terms of just giving us a little bit of confidence around that, you know, presumably you would see some sort of inflection here in the back half of the year. Is that a fair assumption? Yes. Some tailwinds that you'll see in the second half of the year are the continued benefits of our price increase. You know, the more new patients that roll on to that higher price point will certainly have an advantage for us. Then also the fourth quarter are two of our heaviest promotions, which really, you know, help boost from a franchise margin perspective, which is just a natural kind of recurring phenomenon for us just in our promotional calendar. I think those two things with, you know, our continued dual strategy. We're gonna continue to invest in greenfields, and we're gonna continue to target, you know, accretive acquisitions, the same that we always have. I think all those, you know, we're taking into account when reaffirming that guidance for the year. Okay. Last one for me then. You're just looking ahead even a little bit further than you know. You did 32 company-operated last year. You know, you're looking for 30-40 this year. You know, is that probably a fair, you know, number to think about as you look towards 2023? Or is there something where there's gonna be a meaningful change either up or down to that range that you've been in now for the last couple years? Yeah. As of right now, you know, we see nothing that changes our strategy. We'll continue to invest in the unit growth and, you know, we're still seeing the clinics ramp strong and contribute strong as they go on to mature. While we don't give any, you know, forward guidance for 2023, to this point, you know, we're not seeing anything that would cause us to deviate from our strategy. Got it. Thanks so much for answering the question. Best wishes. Thanks, Jeremy. Thanks a lot. Next question comes from Jeff Van Sinderen with B. Riley. Please go ahead. Hi, everyone. You know, I guess one thing I wanted to start with, is there any more color you can give us on sort of the underlying KPIs around new customers, retention, average size of packages purchased? Then I guess, you know, plans to further improve those metrics in second half. Obviously Q4, you do run a big promo. Then I guess overall impact around your thinking, or overall impact, from a slower consumer discretionary environment in general. Yeah. I think I'll start, Jeff, and Peter you can layer on. As I think about, you know, three of our core metrics, new patients, conversion, and attrition, as we look at the, you know, kind of phenomenon through the second quarter, again, we mentioned it in the script, new patients continue to be strong, although they're lower than we saw during Q2 2021. I think, you know, we've got a little bit of a headwind as it relates to the new patients. While they're still healthy, you know, it's down year-over-year. As I look at the other two metrics, you know, we're seeing favorable conversion, and we're seeing favorable attrition. Those two are trending well for us in the second quarter. Those really are, you know, core items that we monitor in terms of the unit health and how we're, you know, continuing to grow our active member bases. Those are looking strong. You know, we had the price increase that came into effect March first. We've now got, you know, a number of months under our belt to see what that is looking like. Again, you know, similar to our previous increases, those KPIs are holding up for us. You know, we mentioned the Google changes that we continue to work on. We're seeing those SEO and organic search numbers continue to rebound, which I think will help our new patient traffic into the third quarter and beyond. We're looking for our clinic teams to continue to execute and keep those conversion and attrition metrics strong. No, I think that's absolutely right. I think to answer your question about the impact of a slowing consumer confidence or a recession or whatever we're talking about is that obviously, you know, I don't know if we're there or not, but you can see in our continued performance of the quarter is that you would say that it certainly doesn't feel like it's impacting us in any measurable degree. As I think about going forward and if we truly go into recession and you have that consumer who's tightening their belt and really making choices about what they're gonna do with that discretionary income, I would believe, and I think it's true, is that the management of pain has a higher priority than, you know, buying their frozen yogurt or getting a cup of coffee. I think we saw that as well in the pandemic, which is if we think about, you know, consumer confidence is one of the biggest challenges I certainly have faced in my life is the pandemic. What we saw is that just the remarkable resilience of this concept in that period, and then that was truly driven by the fact that our patients saw their healthcare is essential to healthcare through getting your chiropractic care was essential to their health. When I think about some pending recession or what that's gonna impact, we know that affordability is essential to this brand. We talk about our ideal family income somewhere between 50 and 105,000. I think if we look at the bottom of that funnel, as people are tightening up their belt, would we expect to see some fallout there? I think so. I think this also opens us up on the higher end of that funnel because historically, for that higher income family that is paying that $75 or $150 for an adjustment, and as they're tightening their belt, I could imagine them asking themselves, "Well, how bad could be that $29 adjustment at The Joint?" And so I think there's an opportunity that on the upper end of that funnel that it will increase, that could offset any kind of, you know, potential losses, for those families who are truly tightening their belt. We also have to remember, this is not a very discretionary service. This is something that is core to our patients, their health. Sure. All good points. I wanted to circle back, if we could, just to the level of improvement that you're seeing in the corporate-owned clinics, the performance metrics there versus maybe franchise performance. I'm just wondering if we've gotten back to where the corporate clinics are performing above the franchise clinics. I guess along those lines, what other initiatives do you have planned to improve corporate-owned performance to get that metric at the highest level you possibly can? Sure. What I would say, Jeff, is that absolutely is that we want the whole system to perform well, that we compare ourselves to each other. When I look at those three metrics that Jake mentioned, our new patient counts, our conversion and our attrition, and I compare the improvements made by the franchise clinics before, you know, compared to the corporate units, in all three instances, we were higher in our performance in the corporate portfolio than the franchise. Now, where we are still seeing a difference is our corporate portfolio is underperforming compared to the franchise when we look at comps. Part of that is just the age of our overall portfolio compared to the age of the overall franchise system. There's also kind of a trailing component to comps as it relates to our membership, so we expected that to improve going forward. What gives me confidence is I think the changes that we made in these last six months in improving our onboarding, our training, our compensation, creating more of a connection to our employees and what we're doing on the field, is that we are seeing improved performance on the clinic level. I would expect that to continue to perform as we go through the rest of the year. Okay. If I could just squeeze in one more and, you know, you may not wanna answer this question, but, as you're looking forward and kinda looking at your model and the number of corporate clinics you'll have, new greenfield openings, any thoughts on when you anticipate year-over-year inflection in EBITDA for the whole company? I'm not sure I understand. The inflection in EBITDA for the consolidated company? Yeah, correct. Yeah. I'm just trying to get a sense of when you think we'll see. Obviously, there's, you know, pressure on expenses with more corporate. You have, you know, you're opening more greenfield. When do you think we sort of get back to a trend of running a, let's call it Adjusted EBITDA sort of positive year-over-year on an ongoing basis, I'd say? Sure. Yeah. Again, a lot of that is dependent on, you know, the continued greenfield development. You know, that's gonna be a consistent phenomenon model, and I just can't stress it enough. You know, the clinics take time to ramp. You know, if we're continuing to invest in those, and certainly investing in new markets, there's amount of infrastructure that goes with that. We just announced that we opened up the Kansas City market, and we'll continue to invest in our infill markets and new markets. With that, it takes time to scale. You know, as we've developed the model and as we look at the pace, you know, there will be a near-term suppression as we continue to work through those, you know, greenfield development and those early working capital losses. You know, where you get the inflection point is at any time we have the ability to slow the pace of that development and just let those clinics continue to mature. You know, looking at the pro forma ramps and how they're starting, you know, we still expect those same four-wall margin potentials that we've seen. As you build out and develop out your clusters, you get the leverage from your field overhead and all the infrastructure investments that you've made. That's always a lever that we have at our disposal. Really, you know, when is that inflection point? You know, until we signal that we're, you know, slowing the pace of that development, you know, you're gonna continue to see the phenomenon. It's really just dependent on how quickly we go and how much of that is dedicated to greenfield pace. Okay. Fair enough. Thanks for taking my questions, and best of luck for the rest of the quarter. Thanks, Jeff. Thank you very much. The next question comes from Brooks O'Neil with Lake Street Capital. Please go ahead. Thank you. Good afternoon. You guys always provide such comprehensive information. We really appreciate it out here. I guess one piece that I'm not sure I heard or I probably missed in your conversation is kind of the time to break even that you're seeing with these new corporate stores. I personally think that's one of the most notable and positive things about your performance. How's it going out there now? Yeah, great question, Brooks. We continue to see similar performance that we talked about in the first quarter. The top line is performing to expectation. You know, we have a great grand opening marketing plan in place. Our operational execution in the early months is really strong. We continue to learn things from our great franchise operators. So our top line performance is there, and we're attracting, you know, a lot of interest in the early months of these clinics. You know, same thing that we said in the first quarter is we continue to see the wage pressure. You know, the DCs and the WC wages have increased from our historical levels, but really, that's pushed our time to breakeven by maybe one or two months. You know, if your top line is still performing strongly, again, we've got additional favorability that's coming from the price increase. The clinics that are opening now are all on the higher price points, which will continue to help that. My pro forma models still look very similar in the long run in terms of margin potential. Certainly, we're encouraged by all the starts and performing to top line ramp to date. Yeah, that's great. I'm glad to hear that, and I'm sure you're really pleased to see it as well. Let me ask one more. Obviously, for a number of years that I've followed you guys' performance, you've delivered just unbelievable comp store sales growth. Obviously, in the last couple quarters, the numbers are still tremendous relative to the rest of the world, but they're lower than they have been historically. Why don't you just talk a little bit about, you know, what's going on there, and maybe if you would, what do you think we should expect to see over the next few quarters or the next year or whatever timeframe you'd like to talk about? Sure. As you know, we don't guide on our comps, and you're absolutely right. If we look at Q2 with the 8%, if I was, you know, any other company but us, they'd be wildly happy about it. For us, it's like, wow, only 8%. Right. I also think you have to put it into a context, is that we had a record-breaking Q2 2021. If you do like a two-year, you know, stack comp, it's almost 60%. What we're doing in all of these numbers is we're measuring performance of Q2 2022 compared to Q2 2021, is that we are overcoming one of the strongest quarters in the history of this company. Even in that case, you're seeing growth virtually in every one of those numbers, which gives us confidence of our momentum continuing to build. As we look at the performance of our portfolio, we believe, again, with the price increase coming in, we'll continue to see positive comps for the rest of the year. We're seeing that as we continue to build this business. As we measure every cohort that we've got out there, they're all positive comps to date. We've got the price increase that's gonna be continuing to support those comps as we go forward. We see continued interest in the business, attracting those new patients, which continues to help build the business of all of our clinics so that we are, you know, strong in our belief in the momentum that will continue to fuel the growth of this business. Great. Thank you very much for taking my questions. Thank you. The next question comes from George Kelly with ROTH Capital Partners. Please go ahead. Hi, everybody. Thanks for taking my questions. First, I wanted to just revisit one of the last questions that you just answered about the ramp. Could you quantify just how many months is it at this point as you're looking at these recent openings, you know, going back over the last few quarters? When is the breakeven? Is it still around six months? And what is the amount, if you could quantify that, just that's invested in that until breakeven? Sure. Yeah, it really depends on how quickly they ramp in terms of a quantified, you know, total impact in terms of time to breakeven on a gross dollars basis. You're right. Historically, we were seeing, you know, around that 6-month timeframe. I think with the additional cost, you know, you're probably looking at 7- to 8-month timeframe. That's that 1- to 2-month slide that I was talking about. You know, we used to, you know, see breakevens on a monthly basis around $25,000 a month maybe. You know, that's probably $27,000-$30,000 a month now. You know, again, you're not talking about, you know, a half a year later it's taking. It's really just a couple of months to get to that breakeven point. I'd say it's probably around, you know, 7-8 months at this point. Okay. Maybe all in, it's somewhere in the neighborhood of $110,000-$120,000 that it takes to get to that breakeven? Yeah, it really just depends. On a twelve-month basis, you know, you're probably looking at $75,000. So that's them incurring, you know, kind of the swath of losses in the earliest months, and that dwindles as you reach that breakeven point, and then you get some offset, in the second portion of that year as you've turned the corner from a breakeven perspective. But again, it really just depends on how quickly clinics are ramping, in terms of how much accumulated losses they're seeing. But on an annualized basis, you know, it's probably somewhere around that $75,000-$80,000. Okay, great. Then I wanted to follow up on pricing. It seems like it, but just sort of make sure that I or confirm that I've heard you right on it. You're really not seeing much of a negative impact from the pricing increase as far as on transactions or volume. I mean, why should I not read into the commentary about, you know, new patients being a little weaker than expected and think that there's been pressure from pricing? Is there a way for you to kinda isolate pricing when you were testing? Yesterday, we've looked at it in the past when we've done for the last time we did a full national price increase was 2016, and then we did those market adjustments in 2019. When we're looking at the metrics that new patient count, the conversion, the attrition overall, we saw that the price increases were either neutral or positive to the business, and that in the analysis we've done so far since the price increase in March 1, we're finding the same thing. Our attrition is actually improving. Our conversion is actually improving. When we talk about the new patient count being down a little bit, I think we associate far more with the organic search algorithm, you know, or the algorithm change that Google made impacting our organic search than a patient, you know, not taking a membership because of the higher price increase. Okay. That's what our data would show us. Yeah. Another layer to that, George, is you know not every clinic in our system moved. We had some that had benefited from a market adjustment fairly recently. Not all of our clinics moved, so we actually had a static control group where we could look at their KPIs as well and kind of give us a basis to how clinics that changed are performing versus clinics that did not have a price change, and we're seeing very similar results. To me, that indicates that there's some more macro issues or search issues versus true representation from price increases. Okay. Last question from me is on your, the Wellness Coordinators and other employees, the chiropractors and regional managers. I know that there's been a lot of discussion for the last few quarters just about turnover and, you know, retaining employees and challenges there and changing pay. Is it feeling more stable, or is it still kind of something you're having to adjust to, you know, all the time? It's still tough. Listen, it's a tough market. Now we have to start with that. I've never been in a market that is so employee positive if you're looking for a job, but there's no question that we have seen improvement. We talked about that with the DCs in terms of making the pricing or their compensation changes in August of last year. We have seen a drop in that turnover rate, and we're continuing to see a stabilization in that area, so we feel you know, we're not done, but we're feeling positive about that. We're a little slower to work with the WCs. We've made those changes earlier this year. Again, while we wanna continue to see that turnover rate come down, is that we have significantly improved it compared to where we were, let's say, in Q4 2021. We are laser-like focused on this issue. It's very essential for us as we continue to improve the performance of our clinics, but we are definitely seeing improvement compared to where we were. Okay. Thank you. Next question comes from Anthony Vendetti with Maxim Group. Please go ahead. Thank you. Yes, just you know in this current environment you know whether we're in a recession or we might enter one you know through COVID you didn't have any issues at all. It seemed like you know certainly throughput through your clinics didn't decline at all. If we were to go into a recession have you done any studies or do you have any data to show what the impact would be to your centers? What do you anticipate the impact to be if you go into a recession? Well, I mean. Metaphorically. Sure. It's always a pleasure. The answer is that this company's never actually gone through a recession, so I don't have any data or experience to say, "Okay, this is what we would've, you know, what we experienced when we saw this level of recession," and so that we could extrapolate to expect that in this one. Well, you're absolutely right. I don't know if we're in a recession. We've had, you know, two quarters of negative growth, but very minor. Most recessions in my career are also associated with a high unemployment. In those same two quarters, that was 3.6% unemployment for both quarters. This is different. I don't. It's hard to imagine what to expect. Like I said earlier in the you know the previous question, is that if we're trying to understand the impact of the recession, it feels like the pandemic is a good indicator of what to expect. The resiliency of this concept through the pandemic gives me comfort that if and whatever we come with that we face with the recession and how deep it is and how long it is, I feel that the nature of our service being so essential to helping people get to relieve their pain feels like it will take precedence over all other discretionary choices that they're going to be making. I think that we would expect to see, like in the pandemic, we would be less impacted by a recession than certainly other kind of retail concepts that we track. That's kind of what I thought, Peter. Just if it were to happen, and you did see some pullback, as you're going through your planning, because there's obviously a planning stage and there's a build-out of some of these corporate-owned centers, how much flexibility do you have to pull back on the greenfields? Would it take months to do that because it's months in the planning session? You know, just give us a little bit of color. Sure. On how you look at that. Sure. Let's say that we're going into a recession, we're in an environment or in a space where we really wanna preserve cash, and we would think, okay, what are the things that we do to manage our cash or utilize our cash? One of the first things is acquisitions. That's 100% discretionary. That you can turn it off with a dime, and boom. You know, so that's easy. You're right, the greenfields do have a longer tail because you're going through that site selection, you're getting up to lease negotiation, you're gonna sign the LOI. Once the LOI is built, then you have the lease negotiations, then you have the build-out of the clinic. There are moments all along that way that you can pause at no cost. For example, okay, I'm just not gonna look for any new site for a period. Or that you say, "Okay, I'll move forward in some of these things, but I may slow down the time I'm taking, the time I get open," because we know the real cost of that greenfield isn't so much in the build-up, but more in those operating losses until we get to breakeven. If you look at 2020, that's exactly what we did, with none of us assuming that the pandemic was gonna hit. In March 2020, or let's say January of 2020, we had plans of opening a fair number of greenfields. The pandemic hit. We said, "You know what? We need to preserve cash." You saw that we did. You know, so that we drew down on our line of credit. We slowed down on greenfield. I think we opened up one greenfield in 2020. We picked it back up in 2021 when we saw, okay, you know what? We can get through this. We do have some levers there to protect our capital. We also are very capital generative. We generated $1.5 million in operating capital this quarter. We generated $15 million you know, the full year 2021. I feel like we have some strong support there to face whatever is gonna happen in the next six months or so. Okay, great. Just maybe one question for Jake. You know, the first margin was a shade over 90%. Is that a good base to go off of, or is it gonna fluctuate in the very high 80s to this 90% or so? No, I think it's fairly representative. You know, most of our clinic level costs are down in G&A. Really the components of cost of revenue for us on a consolidated basis are relatively predictable. You know, we are seeing continued web hosting costs, which we put into that line, just as our platform scales and the amount of data that we have. But I think, you know, as a percentage of sales, I think it's pretty representative. Excellent. Thanks. I'll jump in back in the queue. Thank you. Thank you. This concludes our question and answer session. I would like to turn the conference over back to Peter Holt for any closing remarks. I wanna thank everybody for their time today. Before I close, I'll share a few comments from an expanding franchisee who was named our Joint Rookie of the Year award in 2021. He owns multiple businesses, including several franchise concepts and a real estate brokerage. After he and his wife visited the first Joint, he decided immediately to buy a franchise. He stated, "The Joint is in line with my vision of health and wellness, is a straightforward business model, and the management was easily available to address all of my questions, making the process very quick." He was set to open his first clinic in March of 2021. In the middle of the pandemic, he encountered external setbacks. However, the franchisee decided that the proactive support from the Joint team led him to push ahead. He also noted that The Joint concept is highly scalable and easy to set up due to the support system. Now he's preparing to open up his second clinic in the fall of 2022 and his third in 2023. Thank you, and stay well adjusted. Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.