YogaWorks, Culver City, California, reported its third quarter 2019 financial results via a Nov. 14 filing with the United States Securities and Exchange Commission (SEC), despite delisting from the NASDAQ Global Market (YOGA) on Aug. 1.
The company's quarterly revenue increased by 9 percent to $16.5 million, according to the filing. It also reported $4.65 million in net losses (a positive decrease of 66.5 percent). Adjusted EBITDA data was not included in the filing.
The company claimed 63 studios as of Sept. 30, 2019, compared to 70 during the same period last year.
The filing also confirmed the resignation of CEO Rosanna McCollough on Oct. 31, 2019. Reasons for her resignation were not detailed, but McCollough will receive severance pay and benefits per her employment contract as well as a 2019 target bonus of $100,000 that will be paid by March 1, 2020, according to the announcement.
McCollough joined YogaWorks as president and COO in February 2015 and was promoted to CEO and board member in March 2016.
In other news, a Dec. 9 hearing is scheduled for YogaWorks’ proposed dismissal of a class action lawsuit filed against the company in California federal court in December 2018. The suit, filed by shareholder Craig Cohen, claimed YogaWorks did not disclose critical financial issues prior to its 2017 IPO, ultimately misleading stakeholders. Yogaworks’ lawyers have counter-argued the validity of Cohen’s claims and questioned the time lapse between YogaWorks’ IPO and the filing of this lawsuit.
The complaint stated: "[T]here existed a trend known to YogaWorks that was likely, and did, impact its financial performance going forward at the time of the IPO, as evidenced by the delayed offering date and downsized IPO that the defendants [were] required to include in its disclosures in the offering materials for the benefit of investors, which they did not do," the complaint continued.
YogaWorks ranked No. 24 on Club Industry's Top 100 Health Clubs of 2019 list with $59.6 million in 2018 revenue.
McCollough contributed to Club Industry's Follow the Fitness Leaders Q&A series throughout 2019.