But we’re also looking at some of the interest that’s been out, especially as we’ve opened this outside of the group. The Joint franchisees, there is some very sophisticated groups, who are interested in larger territory of our clinics. We’ve got 135 corporate clinics, we’ve talked about the vast majority being up for sale, so I think that we have some real opportunities to look at those transactions. And so those transactions, of course, they are a little more – they will take a little more due diligence, take a little more time to put together. But what I would say is that we are certainly pleased with the interest in this refranchising effort, and that from our perspective, having said all I just said, we would like to get this done as quickly as possible because it does take a toll on continuing to run these units when they know that they’re – if you are an employee or outside the four wall employed before those units, it creates uncertainty and people don’t like uncertainty.
And so we would expect that the majority of those employees would be hired by the new owners, but it creates that uncertainty that you just want to minimize as we go through this effort. I don’t know Jake if you have anything more to add.
Jake Singleton: I think there was a part of the question there on valuation. And we are in active negotiations, so probably don’t want to give too much out there. But we’ve done historical look-back analysis. We were purchasers of clinics for a lot of years, and we also see all the franchisee-to-franchisee transfers that happen within our system because we do hold that right of first refusal. So we have a pretty good sense for historical multiples of EBITDA that these trade for. And we will continue to partner with the right groups that can maximize that value and generate the proceeds that these quality assets deserve.
C. J. Dipollino: Okay, understood. Thank you. And then moving on to the P&L, it looks like general and administrative was up year-over-year on an absolute basis. Just curious how you guys are thinking about G&A moving forward and if we should expect more absolute increases year-over-year.
Jake Singleton: Yes. I think Q1 last year was $20.3 million – or $20 million. I think it was $20.3 million for this quarter, so up slightly. We did have some accounting, and legal and professional service costs associated with some of the refranchising effort. We do have a year’s worth of additional headcount that’s rolling over on a 100-plus unit increased base. I think the critical piece of that question is, is we understand that for the refranchising strategy to work, we have to be critically focused on cutting the necessary G&A to reach those profitability targets that we have. So that will be something that we consistently monitor. As you gleaned from the call, we have not executed through March 31 a ton of those deals yet and you’ll expect to see that G&A begin to taper as we continue our progress through that refranchising effort.
So it will really be dependent on when the refranchising transactions, how large they are and then we’ll be able to shed the associated G&A, but that will be a critical focus of management as we continue this process.
C. J. Dipollino: Okay, cool. Thank you. And then one more. So the FAST Act came into place about a month ago. Curious, especially with the California stores, curious if you have seen any attritional labor of maybe some of the lower-paying jobs going and finding work elsewhere?
Jake Singleton: Yes I think from our perspective that had been rumored for a long time. So, I think we started to see the wage pressures on that certainly before the bill was officially executed. We haven’t seen really an uptick in turnover as it relates to ours roles and knowing that they now have kind of a competitive benchmark out there for some other QSR-type concepts. It’s something that we’ll continue to monitor, but we haven’t really felt a direct and immediate impact so far as it relates to our wage levels, because I think, we had largely absorbed a lot of that pressure kind of leading up to the actual finalization.
Peter Holt: And internally, its impacting the market, but it allows specifically the QSR.
C. J. Dipollino: All right, okay. Thank you. Ill hop back in the queue.
Operator: That does conclude our question-and-answer session. I would like to turn the conference back over to Peter for any closing remarks.
Peter Holt: Thank you, Kaley. And thank you all for attending the call. Today, I’d like to share a note from our VP of Chiropractic and Compliance he had received from a prior student who went through a preceptorship program at The Joint and is now a full-time employee. And I’m quoting, “My preceptorship with The Joint chiropractic was an enriching experience that provided me the invaluable hands-on practice and deepened my understanding of patient care. The mentorship I received was top notch with so many different doctors providing helpful input in my technique and flow. The opportunity to work with a diverse patient population allowed me to hone my adjusting skills and tailor my treatment plans to individual needs. This preceptorship bolstered my confidence in my chiropractic ability and reinforced my commitment to this healing profession.” And were so pleased to have had that doctor join our team. Thank you. And stay well-adjusted.
Operator: That does conclude our conference for today. Thank you for participating. You may now disconnect.
