Exhibit 99.1

YOGAWORKS, INC. REPORTS SECOND QUARTER 2017 FINANCIAL RESULTS

LOS ANGELES, September 21, 2017 – YogaWorks, Inc. (the “Company”), one of the largest providers of high quality yoga instruction in the U.S., today announced financial results for the second quarter ended June 30, 2017.

Rosanna McCollough, President and Chief Executive Officer of YogaWorks, stated, “Our second quarter results were in line with our expectations and we remain pleased with the progress in our business. Following our IPO, we have the capital in place and are well positioned, as the acquirer of choice within the large and highly fragmented yoga industry, to execute our growth plan of acquiring premier studios. In August, we completed the acquisition of two studios: our first in Virginia, in the city of Arlington, and one in the Dupont Circle neighborhood of Washington, D.C., extending our footprint in the D.C. area while leveraging our regional infrastructure.”

Ms. McCollough continued, “As we look ahead, we plan to drive growth primarily through acquisitions and have letters of intent signed to add 15 studios to our family. In addition, we remain focused on driving solid performance across our studio base through national and local marketing, localized programming, best-in-class teacher trainings and workshops as well as our online offering. We look forward to growing our business while helping people reach their personal goals of physical and mental well-being.”  

Results for the Second Quarter Ended June 30, 2017

 

 

June 30, 2017

June 30, 2016

GAAP Results

 

 

  Net revenue

$12.5 million

$13.3 million

  Net loss

$4.4 million

$2.8 million

 

 

 

Non-GAAP Results(1)

 

 

  Adjusted EBITDA

$(551,000)

$(46,000)

  Studio-Level EBITDA

$2.2 million

$2.6 million

  Adjusted net loss

$3.1 million

$2.7 million

 

 

(1)

Adjusted EBITDA, Studio-Level EBITDA and Adjusted net loss are non-U.S. generally accepted accounting principles (“GAAP”) measures. For reconciliations to GAAP net loss, see "Reconciliations of Non-GAAP Financial Measures" accompanying this press release.

Net revenue was $12.5 million for the second quarter of 2017, a 6.3% decrease compared to $13.3 million for the second quarter of 2016. The decrease was primarily due to a larger portion of sales being classified as deferred revenue which will be recognized as net revenue in future periods.  The increase in deferred revenue in the second quarter as compared to the same period last year was principally the result of a sales mix shift from monthly memberships toward class packages which were offered at all of our studios as of July 2016.  The Company believes that offering class packages allows it to broaden the student base over time and better serve students overall.

The Company ended the quarter with 50 studios in six regional markets with one closure and one opening since the quarter ended 2016.

Total cost of revenue and operating expenses for the quarter increased 5.6% to $16.7 million compared to $15.8 million for the second quarter of last year. This increase was primarily due to a $0.9 million accrual for a legal settlement.

Adjusted EBITDA was $(551,000) for the second quarter of 2017 compared to Adjusted EBITDA of $(46,000) for the same quarter last year. Adjusted net loss for the second quarter of 2017 was $3.1 million compared to Adjusted net loss of $2.7 million for the same period last year.  For a reconciliation of GAAP net loss to Adjusted EBITDA and GAAP net loss to Adjusted net loss, please see “Reconciliations of Non-GAAP Financial Measures” accompanying this press release.


Balance Sheet and Cash Flow Highlights

Cash and cash equivalents were $3.5 million as of June 30, 2017, and $1.9 million as of December 31, 2016. The deferred revenue balance increased $0.6 million for the second quarter of 2017 compared to a $0.1 million increase during the second quarter of 2016.

Initial Public Offering

On August 16, 2017, the Company completed its initial public offering (“IPO”) of common stock at a price to the public of $5.50 per share. The Company issued 7,300,000 shares of common stock and received proceeds of $37.6 million, net of underwriting fees, but before offering costs of $2.1 million. The Company used $10.2 million of proceeds from the IPO to pay off debt and related interest and fees, resulting in net proceeds of approximately $27.4 million.

Guidance

For the third quarter of 2017, the Company expects net revenue between $12.7 million and $13.2 million and Adjusted EBITDA between $(0.3) million and $(0.8) million.

For fiscal 2017, the Company expects net revenue between $53.2 million and $54.2 million and Adjusted EBITDA between $(0.5) million and $(1.5) million. Net revenue for fiscal 2017 assumes the acquisition of 10 to 13 studios in the second half of the year.  

Conference Call to Discuss Second Quarter Results

The Company will host a conference call and webcast to discuss its financial results for the second quarter ended June 30, 2017, today, September 21, 2017, beginning at 4:30 p.m. Eastern Time. A live webcast of the conference call will be available online at www.yogaworks.com under the Investor Relations section and will remain available for 30 days following the live call. A replay will also be available two hours following the call through October 5, 2017, via telephone at 1-844-512-2921 (U.S.) and 1-412-317-6671 (international) by entering the replay pin 13670114.

About YogaWorks, Inc.  

YogaWorks, Inc. is one of the largest providers of high quality yoga instruction in the U.S., operating 52 studios in six regions. Through its studios, the Company offers yoga classes, integrated fitness classes, workshops, teacher training programs, and highly curated assortment of yoga merchandise. In addition to its studio locations, YogaWorks offers online instruction through its MyYogaWorks web platform which provides users access to an on-demand library of over 1,000 yoga and meditation classes. YogaWorks strives to make yoga accessible to everybody and offers a wide range of class styles for people of all ages and abilities. More information is available at www.yogaworks.com.

Forward-Looking Statements

This press release may include forward-looking statements that reflect the Company’s current views about future events and financial performance. All statements other than statements of historical facts included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Words such as “estimates,” “expects,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “forecasts” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events are forward-looking statements.


These forward-looking statements are expressed in good faith and the Company believes there is a reasonable basis for them. However, there can be no assurance that the events, results or trends identified in these forward-looking statements will occur or be achieved. Investors should not place undue reliance on any of the Company’s forward-looking statements because they are subject to a variety of risks and uncertainties. Factors that could cause results to differ from those reflected in the forward-looking statements are set forth in the Company’s prior press releases and public filings with the Securities and Exchange Commission, which are available via the Company’s website at www.yogaworks.com. The forward-looking statements in this press release speak only as of the date of this release and, except as required by law, the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances.

Contacts:

Investor Relations:

Jean Fontana, ICR, Inc.

646-277-1200

IR@yogaworks.com

Media:

Alecia Pulman, Brittany Fraser, or John Kell, ICR, Inc.

646-277-1200

YogaWorks@icrinc.com


YogaWorks, Inc.

 

Condensed Consolidated Balance Sheets

 

 

 

 

As of

June 30, 2017

 

 

As of

December 31, 2016

 

 

 

 

(Unaudited)

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

3,547,025

 

 

$

1,912,421

 

Inventories, net

 

 

878,589

 

 

 

948,194

 

Prepaid expenses and other current assets

 

 

1,913,317

 

 

 

1,318,137

 

Total current assets

 

 

6,338,931

 

 

 

4,178,752

 

Property and equipment, net

 

 

7,653,492

 

 

 

8,552,674

 

Intangible assets, net

 

 

22,654,589

 

 

 

25,654,823

 

Goodwill

 

 

17,746,570

 

 

 

17,746,570

 

Other non-current assets

 

 

1,057,299

 

 

 

1,015,079

 

Total assets

 

$

55,450,881

 

 

$

57,147,898

 

 

 

 

 

 

 

 

 

 

Liabilities, Redeemable Preferred Stock and Stockholders’ Equity/(Deficit)

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$

1,807,265

 

 

$

1,162,675

 

Accrued compensation

 

 

1,399,703

 

 

 

1,504,034

 

Current portion of long-term debt, net of debt issuance costs

 

 

6,537,007

 

 

 

418,750

 

Deferred revenue

 

 

5,101,146

 

 

 

4,593,076

 

Convertible note due to related party

 

 

3,267,905

 

 

 

 

Current portion of deferred rent

 

 

124,817

 

 

 

192,569

 

Total current liabilities

 

 

18,237,843

 

 

 

7,871,104

 

Deferred rent, net of current portion

 

 

2,599,932

 

 

 

2,471,734

 

Deferred tax liability

 

 

104,401

 

 

 

59,536

 

Convertible note due to related party

 

 

 

 

 

11,634,592

 

Long-term debt, net of current portion and debt issuance costs

 

 

 

 

 

6,350,320

 

Total liabilities

 

 

20,942,176

 

 

 

28,387,286

 

Commitments and Contingencies

 

 

 

 

 

 

 

 

Redeemable preferred stock, Redeemed and converted as of June 30,

   2017. $0.001 par value; 10,000 shares authorized, issued and outstanding at

   December 31, 2016; Liquidation Preference $61,392,824 at

   December 31, 2016

 

 

 

 

 

61,392,824

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity (deficit)

 

 

 

 

 

 

 

 

Common stock at June 30, 2017, $0.001 par value; 14,131,017 shares

   authorized and 8,909,078 shares issued and outstanding and $0.001

   par value; 100,000 shares authorized and 74,559 shares issued and

   outstanding at December 31, 2016

 

 

8,909

 

 

 

75

 

Additional paid in capital

 

 

75,259,516

 

 

 

67,187

 

Accumulated deficit

 

 

(40,759,720

)

 

 

(32,699,474

)

Total stockholders’ equity (deficit)

 

 

34,508,705

 

 

 

(32,632,212

)

Total liabilities, redeemable preferred stock, and stockholders’ equity (deficit)

 

$

55,450,881

 

 

$

57,147,898

 

 


YogaWorks, Inc.

 

Condensed Consolidated Statements of Operations (Unaudited)

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

Net revenues

 

$

12,493,461

 

 

$

13,330,076

 

 

$

26,483,555

 

 

$

28,421,723

 

Cost of revenues and operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of revenues

 

 

4,805,637

 

 

 

5,283,949

 

 

 

9,934,389

 

 

 

10,602,309

 

Center operations

 

 

5,583,228

 

 

 

5,532,241

 

 

 

11,269,866

 

 

 

11,094,949

 

General and administrative expenses

 

 

4,094,443

 

 

 

2,725,056

 

 

 

7,104,829

 

 

 

5,903,352

 

Depreciation and amortization

 

 

2,167,877

 

 

 

2,227,145

 

 

 

4,369,462

 

 

 

4,407,562

 

Total cost of revenues and operating

   expenses

 

 

16,651,185

 

 

 

15,768,391

 

 

 

32,678,546

 

 

 

32,008,172

 

Loss from operations

 

 

(4,157,724

)

 

 

(2,438,315

)

 

 

(6,194,991

)

 

 

(3,586,449

)

Interest expense, net

 

 

248,874

 

 

 

390,265

 

 

 

810,506

 

 

 

781,181

 

Net loss before provision

   for income taxes

 

 

(4,406,598

)

 

 

(2,828,580

)

 

 

(7,005,497

)

 

 

(4,367,630

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Provision for income taxes

 

 

41,107

 

 

 

3,882

 

 

 

59,006

 

 

 

10,625

 

Net loss

 

 

(4,447,705

)

 

 

(2,832,462

)

 

 

(7,064,503

)

 

 

(4,378,255

)

Less preferred rights dividend on redeemable

   preferred stock

 

 

 

 

 

(1,153,557

)

 

 

(995,743

)

 

 

(2,284,556

)

Net loss attributable to common

   stockholders

 

$

(4,447,705

)

 

$

(3,986,019

)

 

$

(8,060,246

)

 

$

(6,662,811

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net loss per share

   attributable to common stockholders

 

$

(0.50

)

 

$

(54.18

)

 

$

(1.66

)

 

$

(91.08

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average number of shares used in

   calculating loss per share attributable to

   common stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted common shares

 

 

8,908,188

 

 

 

73,570

 

 

 

4,857,160

 

 

 

73,155

 

 


Reconciliations of Non-GAAP Financial Measures

This press release contains financial measures called Adjusted EBITDA, Studio-Level EBITDA and Adjusted net loss which are not calculated in accordance with GAAP. The Company uses these financial measures to understand and evaluate the business. Adjusted EBITDA is a supplemental measure of the operating performance of the core business operations. Studio-Level EBITDA is a supplemental measure of the operating performance of the studios. Adjusted net loss is a supplemental measure of operating performance that is adjusted for certain non-recurring items that we do not believe directly reflect our core business operations. Accordingly, the Company believes Adjusted EBITDA, Studio-Level EBITDA and Adjusted net loss provide useful information to investors and others in understanding and evaluating the Company’s operating results in the same manner as management and the board of directors. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

Adjusted EBITDA and Studio-Level EBITDA

The following table presents a reconciliation of Adjusted EBITDA and Studio-Level EBITDA to Net loss for each of the periods indicated:

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

(in thousands)

 

(Unaudited)

 

Net loss

 

$

(4,448

)

 

$

(2,832

)

 

$

(7,065

)

 

$

(4,378

)

Interest expense, net

 

 

249

 

 

 

390

 

 

 

810

 

 

 

781

 

Provision for income taxes

 

 

41

 

 

 

4

 

 

 

59

 

 

 

11

 

Depreciation and amortization

 

 

2,168

 

 

 

2,227

 

 

 

4,369

 

 

 

4,408

 

Deferred rent(a)

 

 

69

 

 

 

66

 

 

 

100

 

 

 

247

 

Stock based compensation(b)

 

 

286

 

 

 

12

 

 

 

825

 

 

 

19

 

Legal settlement(c)

 

 

865

 

 

 

 

 

 

865

 

 

 

 

Severance(d)

 

 

3

 

 

 

15

 

 

 

85

 

 

 

15

 

Executive recruiting(e)

 

 

30

 

 

 

47

 

 

 

30

 

 

 

47

 

Professional fees(f)

 

 

161

 

 

 

 

 

 

161

 

 

 

 

Great Hill Partners expense

   reimbursement fees(g)

 

 

25

 

 

 

25

 

 

 

50

 

 

 

50

 

Adjusted EBITDA

 

$

(551

)

 

$

(46

)

 

$

289

 

 

$

1,200

 

Other general and administrative

   expenses(h)

 

 

2,723

 

 

 

2,627

 

 

 

5,088

 

 

 

5,773

 

Studio-Level EBITDA

 

$

2,172

 

 

$

2,581

 

 

$

5,377

 

 

$

6,973

 

 

 

(a)

Reflects the extent to which our rent expense for the period has been above or below our cash rent payments.

 

(b)

Non-cash charges related to equity-based compensation programs, which vary from period to period depending on timing of awards and forfeitures.

 

(c)

Legal settlement expense related to a wage settlement case with the state of California.

 

(d)

Severance expenses incurred in the period related to the termination of studio and non-studio employees.

 

(e)

Executive recruiting expenses incurred in connection with the recruitment and hiring of members of our executive management team, including Ms. Dawson (2016) and Mr. Chang (2016).

 

(f)

Professional fees related to accounting, tax and consulting services that were expensed in connection with the IPO.

 

(g)

Represents expense reimbursement fees incurred in connection with our Expense Reimbursement Agreement with Great Hill Partners, which ended with the filing of the Company’s IPO.

 

(h)

Represents general and administrative expenses that are corporate and regional expenses and not incurred by our studios, and which are primarily comprised of expenses related to (i) wages and benefits of corporate and regional employees, (ii) non-studio rent, utilities and maintenance, (iii) corporate and regional marketing and advertising and (iv) corporate professional fees. Other general and administrative expenses exclude any general and administrative expenses related to deferred rent, stock based compensation, legal settlement, severance, executive recruiting, professional fees and the Great Hill Partners expense reimbursement fees or any other general and administrative expenses that are included in the reconciliation of net loss to Adjusted EBITDA.

 

 


Adjusted Net Loss

The following table presents a reconciliation of Adjusted net loss to Net loss for each of the periods indicated:

 

 

 

Three Months Ended June 30,

 

 

Six Months Ended June 30,

 

 

 

2017

 

 

2016

 

 

2017

 

 

2016

 

(in thousands)

 

(Unaudited)

 

Net loss

 

$

(4,448

)

 

$

(2,832

)

 

$

(7,065

)

 

$

(4,378

)

Stock based compensation(a)

 

 

286

 

 

 

12

 

 

 

825

 

 

 

19

 

Legal settlement(b)

 

 

865

 

 

 

 

 

 

865

 

 

 

 

Severance(c)

 

 

3

 

 

 

15

 

 

 

85

 

 

 

15

 

Executive recruiting(d)

 

 

30

 

 

 

47

 

 

 

30

 

 

 

47

 

Professional fees(e)

 

 

161

 

 

 

 

 

 

161

 

 

 

 

Great Hill Partners expense

   reimbursement fees(f)

 

 

25

 

 

 

25

 

 

 

50

 

 

 

50

 

Adjusted net loss

 

$

(3,078

)

 

$

(2,733

)

 

$

(5,049

)

 

$

(4,247

)

 

 

(a)

Non-cash charges related to equity-based compensation programs, which vary from period to period depending on timing of awards and forfeitures.

 

(b)

Legal settlement expense related to a wage settlement case with the state of California.

 

(c)

Severance expenses incurred in the period related to the termination of studio and non-studio employees.

 

(d)

Executive recruiting expenses incurred in connection with the recruitment and hiring of members of our executive management team, including Ms. Dawson (2016) and Mr. Chang (2016).

 

(e)

Professional fees related to accounting, tax and consulting services that were expensed in connection with the IPO.

 

(f)

Represents expense reimbursement fees incurred in connection with our Expense Reimbursement Agreement with Great Hill Partners which ended with the filing of the Company’s IPO.

 

View differences made from one to another to evaluate Yogaworks, Inc.'s financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 8-K Corporate News to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Yogaworks, Inc..

Continue

Never Miss A New SEC Filing Again


Real-Time SEC Filing Notifications
Screenshot taken from Gmail for a new 10-K Annual Report
Last10K.com Member Feature

Receive an e-mail as soon as a company files an Annual Report, Quarterly Report or has new 8-K corporate news.

Continue

We Highlighted This SEC Filing For You


SEC Filing Sentiment Analysis - Bullish, Bearish, Neutral
Screenshot taken from Wynn's 2018 10-K Annual Report
Last10K.com Member Feature

Read positive and negative remarks made by management in their entirety without having to find them in a 10-K/Q.

Continue

Widen Your SEC Filing Reading Experience


Increased Reading Area for SEC Filings
Screenshot taken from Adobe Inc.'s 10-Q Quarterly Report
Last10K.com Member Feature

Remove data columns and navigations in order to see much more filing content and tables in one view

Continue

Uncover Actionable Information Inside SEC Filings


SEC Filing Disclosures
Screenshot taken from Lumber Liquidators 10-K Annual Report
Last10K.com Member Feature

Read both hidden opportunities and early signs of potential problems without having to find them in a 10-K/Q

Continue

Adobe PDF, Microsoft Word and Excel Downloads


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshots of actual 10-K and 10-Q SEC Filings in PDF, Word and Excel formats
Last10K.com Member Feature

Export Annual and Quarterly Reports to Adobe PDF, Microsoft Word and Excel for offline viewing, annotations and analysis

Continue

FREE Financial Statements


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshot of actual balance sheet from company 10-K Annual Report
Last10K.com Member Feature

Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports

Continue for FREE

Intrinsic Value Calculator


Intrinsic Value Calculator
Screenshot of intrinsic value for AT&T (2019)
Last10K.com Member Feature

Our Intrinsic Value calculator estimates what an entire company is worth using up to 10 years of financial ratios to determine if a stock is overvalued or not

Continue

Financial Stability Report


Financial Stability Report
Screenshot of financial stability report for Coco-Cola (2019)
Last10K.com Member Feature

Our Financial Stability reports uses up to 10 years of financial ratios to determine the health of a company's EPS, Dividends, Book Value, Return on Equity, Current Ratio and Debt-to-Equity

Continue

Get a Better Picture of a Company's Performance


Financial Ratios
Available Financial Ratios
Last10K.com Member Feature

See how over 70 Growth, Profitability and Financial Ratios perform over 10 Years

Continue

Log in with your credentials

or    

Forgot your details?

Create Account