Brian Harbour: Okay, thank you.
Operator: Thank you. The next question is from Jonathan Komp of Baird. Please go ahead.
Jonathan Komp: Yes, hi, thank you. Good afternoon everyone. I want to just ask about the same-store sales trend that you’re seeing. And first quarter, you were at 20%, second quarter at 15%, strong numbers, but obviously, different ways you could interpret the trend and trajectory. So can you give any more insight in terms of the trend that you’re seeing for same-store sales? And then any color what we should expect going into the back half?
John Meloun: Yes. So first quarter, obviously, 20%, as you mentioned, 15% in the second quarter. I do see, obviously, system-wide sales as they continue to grow. I do expect to see same-store sales normalize over time. I mentioned on previous calls that I do believe in 2023, you’re still benefiting from a pretty strong growth perspective on studios getting into — as they kind of grow into maturities, we continue to open more studios, you’re going to see elevated same-store sales over the coming quarters. Mid- to high single digits is still my long-term kind of guidance or expectation on how studios will perform. But I do expect 2023 to be in the mid-teens, the 15%, 16% range in same-store sales, you look in the second half of this year.
As I mentioned, Q3 is typically a strong quarter when you look at it quarter-on-quarter, and you see strong growth. So I do expect Q3 and Q4 to stay somewhat elevated as you benefit from people, as I mentioned, the seasonality going back to — kids going back to school, parents start going back to their workouts from vacation. And then also in Q4, we always have our Black Friday holiday promotions, and we typically see strong sales in that quarter. So I expect 16%-ish range for the full-year. I think Q3 and Q4, you’ll see around that level as well. And then as you kind of roll into 2024, as we kind of continue to monitor, assess, measure, see how studios are opening up, we’ll get a better idea. But long-term, mid- to high single-digits as you start looking beyond 2023.
Jonathan Komp: Got it. That’s helpful color. And then I want to follow-up to ask about the Board’s decision to initiate the buyback program and to do so with taking on incremental debt. Just — any thoughts to the process there and weighing the different options relative to using internally generated cash or further simplifying the capital structure. I know you bought back some of the preferred shares in the past or the convertible debt. So just any additional thoughts on the thought process and how the Board may have settled on the path that it did.
John Meloun: Yes. I mean, we finished the quarter with $40 million in cash. Obviously, we announced a $50 million repurchase. The long-term goal was always to kind of put in place a more efficient capital structure with the securitization. So we had always talked about the preferred shares and wanting to repurchase those. It’s all — to me, it’s all fungible, whether it’s Class A, Class B preferred. The ultimate goal is to have as few shares out there as possible, I guess, from an antidilutive perspective. So for us, the way we looked at it is the debt was available to us. We have a great partner, MSD, who offered to say, “Listen, we’ll be willing to give you guys the capital to do the shares”, because they also see this as shareholders from their perspective, but they also see it as the stock being undervalued at these levels.
