YogaWorks, Inc. engages in the ownership and operation of yoga studios and training centers. The firm provides yoga space, teachers at studios, training program, workshops, retreats, and online lessons including Vinyasa, Gentle Yoga, Ashtanga, hot yoga, prenatal classes, and community classes. It also offers a variety of fitness classes. Yoga Works was founded by Maty Ezraty, Chuck Miller, and Alan Finger in 1987 and is headquartered in Culver City, CA.
Our growth strategy is highly dependent on our ability to successfully identify and acquire studio targets and integrate their operations with ours.
Our recently acquired or newly opened studios may negatively impact our financial results in the short-term and may not achieve sales and operating levels consistent with our existing studios on a timely basis or at all.
Acquiring or opening new studios in close proximity to existing studios may negatively impact our existing studios’ revenues and profitability.
Our history of continued losses has raised substantial doubt regarding our ability to continue as a going concern. If we do not continue as a going concern, investors could lose their entire investment.
We expect to make capital expenditures to pursue our growth strategy, which may be significant and will adversely impact our cash flow and liquidity.
To finance our growth strategy, we may have to incur additional indebtedness or issue new equity securities and, if we are not able to obtain additional capital, our ability to operate or expand our business may be impaired and our results of operations could be adversely affected.
We have grown rapidly in recent years and have limited operating experience at our current scale of operations. Our growth could place strains on our management, employees, information systems and internal controls, which may adversely impact our business.
An economic downturn or economic uncertainty in our markets may adversely affect discretionary spending and demand for our services.
Increases in labor costs, including wages, could adversely affect our business, financial condition and results of operations.
Our profitability is vulnerable to cost increases and inflation.
Our growth and profitability could be negatively impacted if we are unable to renew or replace our current studio leases on favorable terms, or at all, and we cannot find suitable alternate locations.
If we fail to attract new students and teachers and retain existing students and teachers, it could have an adverse impact on our growth strategy as we may not be able to increase the number of visits to our studios or students that go through our teacher training.
We may be adversely affected by any negative publicity, regardless of its accuracy, that could harm our business.
Our financial and operating performance may be adversely affected by epidemics, adverse weather conditions, natural disasters and other catastrophes.
The level of competition we face could negatively impact our revenue growth and profitability.
We have experienced significant recent turnover in our executive leadership team. If we fail to effectively integrate and retain these new executives, we may not be able to accomplish our growth strategy and our financial performance may suffer.
If we are unable to anticipate student preferences and provide high quality yoga offerings, we may not be able to maintain or increase our membership base, sales from class packages, drop-ins and teacher trainings, participation in MyYogaWorks.com and profitability.
Changes in government regulations or a failure to comply with them could have a negative effect on our financial condition.
We are, or may become, subject to risks associated with our teacher training sessions or workshops held in international countries.
We are subject to a number of risks related to credit card and debit card payments we accept.
We rely on third parties to provide services in connection with our business, and any failure by these third parties to perform their obligations could have an adverse effect on our business, financial condition and results of operations.
Disruptions and failures involving our information systems could cause dissatisfaction and adversely affect our billing and other administrative functions.
We face continuing and growing security risks to our information base, including the information we maintain relating to our customers.
We rely on a limited number of vendors for our retail product offerings and fitness equipment. A loss of any of our vendors could negatively affect our business.
Our operating results are subject to seasonal and quarterly variations in our net revenues and income from operations, which could adversely affect the price of our publicly traded common stock.
We are involved, and may become involved in the future, in legal proceedings that, if adversely adjudicated or settled, could adversely affect our financial results.
We could be subject to legal claims, including labor and employment related claims and personal injury claims or claims of teacher or employee impropriety related to the use of our studios.
Our trademarks and trade names may be infringed, misappropriated or challenged by others.
We may be subject to liability if we infringe upon the intellectual property rights of third parties.
Any further impairment of goodwill could adversely affect our financial condition and results of operations.
Changes in lease accounting standards may materially and adversely affect us.
Changes in accounting standards and subjective assumptions, estimates and judgments by management related to complex accounting matters could significantly affect our financial results or financial condition.
Our internal controls and accounting methods may require modification.
Our insurance may not provide adequate levels of coverage against claims.
Inventory shrinkage could have a negative impact on our business, financial condition and results of operations.
Our ability to use our net operating losses to offset future taxable income may be subject to limitations.
If we are unable to implement and maintain effective internal control over financial reporting in the future, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock may be negatively affected.
If our stock price fluctuates, you could lose a significant part of your investment.
Your ability to influence corporate matters may be limited because Great Hill Partners beneficially owns a substantial amount of our common stock and will continue to have substantial control over us.
Two of our directors have relationships with Great Hill Partners, which may cause conflicts of interest with respect to our business.
Our certificate of incorporation contains a provision renouncing our interest and expectancy in corporate opportunities.
Our management has broad discretion over the use of the proceeds we received in the IPO and might not apply the proceeds in ways that increase the value of your investment.
Our fourth amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware is the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.
We do not expect to declare any dividends in the foreseeable future.
If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.
We are a “controlled company” within the meaning of the Nasdaq rules. As a result, we qualify for, and intend to continue to rely on, exemptions from corporate governance requirements that provide protection to stockholders of other companies.
This Annual Report on Form 10-K contains forward-looking statements, including statements based upon or relating to our expectations, estimates, and projections. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. These statements are not guarantees of future performance; they reflect our current views with respect to future events and are based on assumptions and are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from expectations or results projected or implied by forward-looking statements.