Simeon Gutman: And may I ask on the Glass business, I think Danny mentioned a couple of things, both in terms of revenue outlook and then in terms of, I don’t know profit normalization or the streamlining of some of these acquisitions, respecting it could take some time, but curious what the time frame, the pace of progress and again, not getting ahead of yourselves, but just what’s a realistic time frame for the margin rate of that business to ramp and then move up into the right.
Jonathan Fitzpatrick: We are dealing with self-inflicted execution issues on the integration Simeon, and we hold ourselves fully accountable for that. But stepping back, when I look at the underwriting thesis for Driven Brands getting into the Glass business in the United States, nothing and I repeat, nothing has changed in our conviction around the long-term opportunity there. There is an opportunity for us to be a really large-scale player. We’ve got the ability to execute on retail customers, commercial customers and grow our insurance business. The unit economics will be very powerful in this business. The capital required to open new stores will be very attractive. So nothing has changed in terms of our long-term optimism around this business. And as Danny said, we hope to have the majority of these integration challenges behind us as we exit Q1 of next year. So we remain really, really bullish on the long-term opportunities for this Glass business.
Simeon Gutman: Okay. Thanks guys. Good luck.
Operator: Your next question comes from the line of Liz Suzuki from Bank of America. Please go ahead.
Liz Suzuki: Great. Thank you. Just a follow-up on the Car wash business. You mentioned that the international operations are performing a little better than the U.S. Can you help us that in terms of comp growth in the U.S. versus international? And then additionally what the U.S. Car Wash comp would have looked like excluding the 29 underperforming stores that you’re closing?
Jonathan Fitzpatrick : Hey, Liz, it’s Jonathan. Yes. Look, first of all, I’ll just congratulate Tracy and the European team for just continuing to deliver really solid results in fairly challenging economic conditions in Europe that European team has really delivered a really good sort of first three quarters of the year and expect them to sort of finish the year strong. Liz, we don’t dissect sort of the comps within the subsegments within car wash. I will tell you that very proud of the European business, but the landscape there is generally different and doesn’t have some of the sort of competitive natures and forces that the U.S. business has. In terms of — so I would stop there, but we’re not — and in terms of the store closures, Liz, we’re going to close 29 stores, U.S. car wash stores in Q4, those stores were 13 years of age on average the vast majority of them had competitors open up within a close proximity to those stores.
Every one of them on an LTM basis had negative same-store sales, negative traffic and therefore also negative EBITDA. As I mentioned, we’ll have a nominal benefit small benefit in Q4, and we’ll reap the full benefit of those closures on the financials in 2024. But we’re not disclosing the specific amount. But it’s again, nominal in Q4 and we’ll see some full year benefit next year.
Liz Suzuki: Understood. And just on the competitive environment in Car wash, what do you think has really changed in the last couple of quarters as you’ve been talking about it more? And are you seeing irrational competitive behavior coming from any of the larger chains? Is it competitors? Like where are you seeing the bad actors in that sector?
Jonathan Fitzpatrick : Yes. Look I wouldn’t call any of my competitors’ bad actors. We’re all fighting for our share in the market. I think Liz what’s happened as we’ve been in this industry now for over three years, it has at least from our perspective changed from a competitive dynamic when we first got into this industry back in late 2020. I think, I’ve mentioned before that we now have almost 20. I think the exact number we’ve reported is 19, “platform” platforms in car wash with sort of institutional capital behind them. So what we’ve seen is just a pretty seismic shift in the number of new units that have opened over the last three years. We do think that that’s likely to continue although moderate as we look into 2024 and 2025. So I think we’ve just got a lot more competition within the U.S. car wash space than we did three, four years ago. So I don’t see that dramatically changing but I wouldn’t call any of my competitors’ bad actors.
Liz Suzuki: Okay. Thank you. Operator: Your next question comes from the line of Kate McShane from Goldman Sachs. Please go ahead.
Kate McShane: Hi, good morning. Thanks for taking our question. At the Investor Day, you outlined expectations for adjusted EBITDA growth to more than double in 2024. Is that still how you’re thinking about the business next year especially in the context of the Car Wash asset sales?
Jonathan Fitzpatrick: Hey, Kate, Jonathan. Yes look, we’re obviously not going to give 2024 guidance at this point but nothing has changed in our narrative from the Investor Day. So I can reaffirm what we said at Investor Day, but we’re not going to give 2024 guidance just yet.
Kate McShane: Okay. And then if we could just ask a follow-up question also on Car Wash. We just wondered if you could talk about what you’re seeing in the subscription growth or what you saw in the third quarter for subscription growth with car wash.
Jonathan Fitzpatrick: Yes. Trends have been pretty similar there, Kate. We’ve seen net membership growth in Q3 very similar to what we’ve seen over the past. I think what Danny is doing and appropriately so is looking at the discounting and promotional activity that has been used in the past to drive some of those new members and really looking at the economic lifetime value of what those memberships are based on discount levels. So we have seen still net member growth in Q3. But I think one of the things that we’re working through is what is the right pricing promotion discounting strategy both for retail customers and on the membership side. So more to come on that but we did see net growth in members.
Kate McShane: Thank you.
Operator: Your next question comes from the line of Christopher Horvers from JPMorgan. Please go ahead.
Christian Carlino: Hi, good morning. It’s Christian Carlino on for Chris. We were just wondering, are there any particular markets where the Car Wash closings are concentrated in? And any early read from the cross marketing – the Car Wash locations at the Quick Lube?
Jonathan Fitzpatrick: Hey, Chris, it’s Jonathan. Yes, there’s no one market where we’re over concentrated. Some of our – as I mentioned some of those assets were 13 years old. They were typically some of the legacy assets that we purchased back in August of 2020. So you see probably a little over-indexing in some of the – I’ll call it the Southeast markets but there’s not one market in particular. So that’s data point number one. Data point number two, on the loyalty platform that Danny and team will be rolling out. That test will start in Q4. We’re excited about getting that up and running. And look forward to reporting on that as we sort of progress the hopefully, test and to full rollout and we’ll certainly be updating as we go through the quarters next year.
Christian Carlino: Got it. That’s helpful. And then just to clarify on an earlier question some of the parts retailers are talking about deferred maintenance. The macro is – it’s a pressure and even nondiscretionary services deferral into a recession before you see things snap back. You’re clearly gaining share but are there any signs of this? Any read into the consumer?
