XWELL, Inc. (Nasdaq: XWEL) ("XWELL" or the "Company"), an
authority in health and wellness solutions for people on the go,
today reported results for the second quarter ended June 30, 2023.
Financial and Business
- Second quarter 2023 revenue at the
Company’s XpresSpa business increased approximately 59% versus the
same quarter in 2022.
- Second quarter 2023 Operating
Expenses decreased approximately 13% sequentially and decreased
approximately 52% from the same quarter in 2022. This progress
demonstrates the positive effect of the Company’s cost-savings
initiatives and focus on delivering a leaner, more profitable
- To further advance the Company’s
efforts to drive profitability and growth, the Company appointed
Suzanne A. Scrabis as Chief Financial Officer of the Company,
effective July 10, 2023
- Focused on growth internationally,
the Company plans to open a new XpresSpa location in Abu Dhabi
during the second half of 2023.
- Continued to successfully integrate
new products and technologies designed to meet customer preferences
and leverage efficiencies to drive profit including expansion of
autonomous services and equipment.
- XWELL continued to focus on growing
its business through acquisitions outside of its airport spa
“XWELL remains committed to improving our
operating performance, investing for growth and returning the
business to profitability,” commented Scott Milford, XWELL’s Chief
Executive Officer. “We continue to benefit from our cost-savings
initiatives as well as progress in advancing a leaner business.
Looking ahead, we’re executing against our plans to transform XWELL
into a leading provider of wellness services for people on the go.
This includes smart expansion of our spa brand as well as the
acquisition and development of businesses outside the airport.
Further, we continue to build on our momentum internationally
including opening our newest XpresSpa location in Abu Dhabi during
the fourth quarter of 2023 and looking at other transit hubs
throughout Europe to launch our labor-lite spa concept.”
Mr. Milford added, “To help accelerate the
implementation of XWELL’s strategy, we’re extremely pleased with
our recent appointment of Suzanne Scrabis as CFO. She has an
impressive track record of efficiently operating companies at
scale, seamlessly integrating M&A transactions, and driving
profitable growth. Her value-oriented mindset makes her an
invaluable asset to our leadership team as we continue to execute
plans to build long-term profitability through continued innovation
Second Quarter Business
There are currently 36 operating XpresSpa
locations, including 10 locations internationally. These
international locations consist of two at Dubai International
Airport in the UAE, three at Schiphol Amsterdam Airport in the
Netherlands, and five at Istanbul Airport in Turkey.
The Company expects to open a new location in
Abu Dhabi during the second half of 2023. The Company’s continued
international expansion allows management the opportunity to
further leverage its expertise in providing premium wellness
services to more international passengers who appreciate health and
wellness services and are willing to spend more in pursuit of their
The Company continues to execute its new retail
strategy to drive more foot traffic into its airport locations and
augment its on-line presence. This includes bringing new
technologies and trends, including new tech-forward equipment,
adding new products in-store and on-line, as well as deploying
plans to refresh the look and appearance of some XpresSpa
locations. These automated offerings include Novo XT massage
chairs, HydroMassage units and fully autonomous, AI-powered express
manicure units, provide self-care to guests while bringing
operational efficiency to the Company’s business model.
Treat is a travel wellness brand and a fully
integrated concept blending technology with traditional brick and
mortar offerings to provide a holistic approach to physical and
mental well-being for travelers. Treat’s on-site centers are
currently located at JFK International Airport in New York and Salt
Lake City International Airport in Utah.
As previously announced, during 2023, XWELL
plans to integrate all existing wellness locations under a single
XpresCheck® and Biosurveillance
Partnership with Ginkgo BioworksThe Company, in
collaboration with the Centers for Disease Control and Prevention
(“CDC”) and Ginkgo Bioworks, currently operates eight
biosurveillance stations in six of the nation’s busiest airports.
On August 12, 2023, the CDC renewed the traveler-based SARS-CoV-2
Genomic Surveillance program through a new one-year contract. The
partnership will support public health and biosecurity services
with a contract value totaling approximately $15.9 million.
As background, in late 2021, in collaboration
with the CDC and Ginkgo Bioworks, XWELL’s XpresTest, Inc.
subsidiary (“XpresCheck”) began conducting biosurveillance
monitoring aimed at identifying existing and new SARS-CoV-2
variants. During the third quarter of 2022, XpresCheck, in
partnership with Ginkgo Bioworks were awarded a new contract in
continuation of their support to the CDC’s traveler-based
SARS-CoV-2 Genomic Surveillance program. In the first quarter of
2023, XpresCheck and Ginkgo Bioworks announced they expanded
their support of the program to include a pilot study monitoring
influenza viruses in addition to SARS-CoV-2, providing an
additional source of viral surveillance to inform the selection of
influenza vaccine viruses for the forthcoming 2023-2024 flu
XpresCheck also provided medical diagnostic
testing services during the outbreak of COVID-19. Following the
relaxation of testing requirements by the United States and other
countries in 2022, XpresCheck locations began to close. As of June
30, 2023, all of the Company’s XpresCheck locations have been
In January 2022, the Company announced and
closed on the acquisition of GCG Connect, LLC d/b/a HyperPointe.
HyperPointe is a leading digital healthcare and data analytics
relationship marketing agency, servicing the global healthcare and
pharmaceutical industry. HyperPointe has significant experience in
patient and healthcare professional marketing and deep
technological experience with CXM (customer experience management)
and data analytics.
Since June 2020, HyperPointe’s management team
and suite of services and technology have been utilized to develop
and deploy the technological infrastructure necessary to scale the
growth of our XpresCheck business. HyperPointe’s experience in this
space continues play a critical role in the expansion of ongoing
biosurveillance efforts created in partnership with Ginkgo Bioworks
and the CDC.
Liquidity and Financial Condition
As of June 30, 2023, the Company had cash and
cash equivalents, excluding restricted cash, of approximately $6.4
million, marketable securities of approximately $25.5 million,
total net working capital of approximately $26.8 million, and no
Summary Second Quarter 2023 Financial
Total revenue during the second quarter ended
June 30, 2023, was $8.2 million compared to $13.6 million in the
prior year second quarter. The decline in revenue was primarily
related to the relaxation of COVID-19 testing requirements by the
United States and other countries in 2022 and the closure of
Revenue for the second quarter of 2023 primarily
consisted of approximately $5.3 million from XpresSpa locations and
Treat locations, $2.3 million in revenue from our bio-surveillance
partnership, and $0.6 million from our HyperPointe segment.
Cost of Sales
Cost of sales decreased to approximately $7.0
million for the second quarter of 2023 compared with approximately
$12.4 million in the second quarter of 2022.
Demonstrating the effect of the Company’s
cost-savings initiatives, total Operating expenses decreased to
approximately $5.9 million for the second quarter of 2023, compared
to approximately $9.0 million for the second quarter of 2022. The
decrease was primarily a result of closing underperforming
locations and right-sizing efforts of the Company’s overall cost
Income from Operations
Loss from operations for the second quarter of
2023 was approximately $4.7 million compared to a loss from
operations of approximately $7.8 million in the second quarter of
Net Income Attributable to Common Shareholders
Net loss attributable to common shareholders was
approximately $5.7 million for the second quarter of 2023 compared
to net loss attributable to common shareholders of approximately
$7.9 million in the second quarter of 2022.
XWELL will host a webcast and conference call at
5:00 pm Eastern Time today. We encourage investors and all
interested parties to listen via webcast as there is a limited
capacity to access the conference call by dialing 412-317-6060.
The live and later archived webcast can be
accessed from the Investor Relations section of the Company’s
website at http://xwell.com. Visitors to the website should select
the “Investors” tab and navigate to the “Events” link to access the
About XWELL, Inc.
XWELL, Inc. (Nasdaq: XWEL) is a leading
global health and wellness holding company operating four brands:
XpresSpa®, Treat™, XpresCheck® and HyperPointe™
- XpresSpa is a
leading airport retailer of wellness services and related products,
with 36 locations in 15 airports globally.
- Treat is a
travel wellness brand and a fully integrated concept blending
technology with traditional brick and mortar offerings to provide a
holistic approach to physical and mental well-being for
- XpresCheck is a
provider of screening and diagnostic testing in partnership with
the CDC and Concentric by Ginkgo, conducting bio-surveillance
monitoring in its airport locations to identify new SARS-CoV2
variants of interest and concern as well as other pathogens
entering the country from across the world.
- HyperPointe is a
leading digital healthcare and data analytics relationship company
serving the global healthcare industry.
This press release may contain "forward-looking"
statements within the meaning of Section 27A of the Securities Act
of 1933, and Section 21E of the Securities Exchange Act of 1934.
These include statements preceded by, followed by or that otherwise
include the words "believes," "expects," "anticipates,"
"estimates," "projects," "intends," "should," "seeks," "future,"
"continue," or the negative of such terms, or other comparable
terminology. Forward-looking statements relating to expectations
about future results or events are based upon information available
to XWELL as of today's date and are not guarantees of the future
performance of the Company, and actual results may vary materially
from the results and expectations discussed. Additional information
concerning these and other risks is contained in the Company’s
Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K, and other Securities and Exchange
Commission filings (which reports were filed under the Company’s
former name, XpresSpa Group, Inc., prior to its previously
announced name change effective October 25, 2022). All subsequent
written and oral forward-looking statements concerning XWELL, or
other matters and attributable to XWELL or any person acting on its
behalf are expressly qualified in their entirety by the cautionary
statements above. XWELL does not undertake any obligation to
publicly update any of these forward-looking statements to reflect
events or circumstances that may arise after the date hereof.
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