Board Increases Quarterly Cash Dividend by 10%
to 6.6 Cents Per Share Annually
Park City Group, Inc., d/b/a ReposiTrak (NYSE: TRAK), the
world's largest food traceability and regulatory compliance
network, built upon its proven inventory management and
out-of-stock reduction SaaS platform, today announced financial
results for the first fiscal quarter (“FQ1 2024”) ended September
30, 2023.
First Quarter Financial Highlights:
- First quarter total revenue increased 7% to $5.1 million from
$4.7 million.
- Recurring revenue increased 8%, net of the planned elimination
of high-touch, low-opportunity revenue, to $5.0 million from $4.7
million, representing approximately 99.7% of total revenue.
- Quarterly operating expense increased 11% to $3.9 million from
$3.5 million, representing primarily one-time investment in sales
and marketing to raise awareness about the FDA mandate and the
ReposiTrak Traceability Network solution.
- Quarterly operating income decreased 2% to $1.2 million from
$1.2 million last year.
- Quarterly GAAP net income increased 7% to $1.4 million from
$1.3 million last year.
- Quarterly net income to common shareholders was $1.2 million,
up 8% from $1.1 million last year.
- Quarterly EPS of $0.07, up 17% from $0.06 last year.
- During the quarter, the Company repurchased 155,025 shares at
an average price of $8.53 for a total of $1.3 million.
- The Board of Directors approved an increase in the Company’s
quarterly cash dividend, to 6.6 cents per share annually (1.65
cents per share quarterly), effective with the December
dividend.
Randall K. Fields, Chairman and CEO of Park City Group
commented, “As we expected, we continued to grow our recurring
revenue, income and cash flow, while intensely focusing on our
Traceability initiative. Our financial results this quarter
reflected the success of that strategy. Our consistent cash
generation has enabled the Board of Directors to authorize a 10%
increase in our quarterly cash dividend starting with shareholders
of record on December 29, 2023.”
“During the quarter, we invested more heavily than usual in
sales and marketing expense to build the infrastructure for
Traceability and continue to increase awareness,” continued Mr.
Fields. “As a result, we have seen an acceleration in the adoption
of Traceability – faster than we originally anticipated. We now
have nearly 500 suppliers in the enrollment cycle, and about 1,000
in the queue that we anticipate will be added over the next nine to
12 months. Our Traceability revenues are modest at this point, but
our pipeline is deep and we expect more hubs (and as a result,
their many suppliers) accelerating implementations as the 2026
deadline looms.”
Mr. Fields continued, “Our current backlog will keep us very
busy through the end of our current fiscal year, as we accelerate
our implementation process. The revenue ramp from Traceability will
grow accordingly throughout the year. We have created a durable
moat around our business as we become the largest and preferred
provider for the industry. As I have said before, while many are
talking about traceability, we are the ones actually doing it, with
live customers, operating at scale.”
First Fiscal Quarter Financial Results (three months
ended September 30, 2023, vs. three months ended September 30,
2022):
Total revenue was up 7% to $5.06 million as compared to $4.72
million in the prior-year first quarter. Total operating expense
was $3.86 million, up 11% compared to $3.49 million last year,
reflecting a 25% increase in sales and marketing expense related to
building awareness for Traceability and other growth initiatives.
General and administrative expense increased by 5%. GAAP net income
was $1.38 million compared to $1.29 million. Net income to common
shareholders was $1.23 million, or $0.07 per diluted share,
compared to $1.14 million, or $0.06 per diluted share.
Return of Capital:
In the first fiscal quarter of fiscal 2024, the Company
repurchased 155,025 shares of common stock at an average price of
$8.53 for a total of $1.3 million. Since inception, the Company has
repurchased 2.05 million shares of common stock for $12.5 million
at an average price per share of $6.22. The Company has
approximately $8.5 million remaining on the $21 million total
buyback authorization since inception.
In September 2022, the Company’s Board of Directors declared a
quarterly cash dividend of $0.015 per share ($0.06 per year). In
November 2023, the Board of Directors approved a 10% increase in
the quarterly cash dividend, to 6.6 cents per share annually, or
1.65 cents per share quarterly, effective with the December 2023
dividend.
In September 2023, the Company announced it plans to redeem its
Preferred Stock over the next three fiscal years. No Preferred
Stock was redeemed during the quarter.
Balance Sheet:
The Company had $23.7 million in cash and cash equivalents at
September 30, 2023, compared to $24.0 million at June 30, 2023. The
Company had nothing drawn on its working line of credit as of
September 30, 2023 or June 30, 2023.
Conference Call:
The Company will host a conference call at 4:15 p.m. Eastern
today to discuss the Company’s results. The conference call will
also be webcast and will be available via the investor relations
section of the Company’s website, www.parkcitygroup.com.
Participant Dial-In Numbers: Date: Tuesday, November 14,
2023 Time: 4:15 p.m. ET (1:15 p.m. PT) Toll-Free: 1-877-300-8521
Toll/International 1-412-317-6026 Conference ID: 7050708
Replay Dial-In Numbers: Toll Free: 1-844-512-2921
Toll/International: 1-412-317-6671 Replay Start: Tuesday, November
14, 2023, 7:15 p.m. ET Replay Expiry: Thursday, December 14, 2023
at 11:59 PM ET Replay Pin Number: 10184210
About Park City Group (d/b/a ReposiTrak)
Park City Group, Inc. d/b/a ReposiTrak (NYSE: TRAK), a
compliance, supply chain, and e-commerce platform that partners
with retailers, wholesalers, and their suppliers, to accelerate
sales, control risk, and improve supply chain efficiencies. More
information is available at www.repositrak.com.
Specific disclosure relating to Park City Group, including
management's analysis of results from operations and financial
condition, are contained in the Company's annual report on Form
10-K for the fiscal year ended June 30, 2023, and other reports
filed with the Securities and Exchange Commission. Investors are
encouraged to read and consider such disclosure and analysis
contained in the Company's Form 10-K and other reports, including
the risk factors contained in the Form 10-K.
Forward-Looking Statement
Any statements contained in this document that are not
historical facts are forward-looking statements as defined in the
U.S. Private Securities Litigation Reform Act of 1995. Words such
as “anticipate,” “believe,” “estimate,” “expect,” “forecast,”
“intend,” “may,” “plan,” “project,” “predict,” “if”, “should” and
“will” and similar expressions as they relate to Park City Group,
Inc., Park City Group d/b/a ReposiTrak, or ReposiTrak (“Park City
Group”) are intended to identify such forward-looking statements.
Park City Group may from time-to-time update these publicly
announced projections, but it is not obligated to do so. Any
projections of future results of operations should not be construed
in any manner as a guarantee that such results will in fact occur.
These projections are subject to change and could differ materially
from final reported results. For a discussion of such risks and
uncertainties, see “Risk Factors” in Park City Group annual report
on Form 10-K, its quarterly report on Form 10-Q, and its other
reports filed with the Securities and Exchange Commission under the
Securities Exchange Act of 1934, as amended. Readers are cautioned
not to place undue reliance on these forward-looking statements,
which speak only as of the dates on which they are made.
PARK CITY GROUP, INC.
Consolidated Condensed Balance
Sheets (Unaudited)
September 30,
2023
June 30, 2023
Assets
Current Assets
Cash
$
23,697,228
$
23,990,879
Receivables, net of allowance for doubtful
accounts of $194,656 and $170,103 at September 30, 2023 and June
30, 2023, respectively
3,022,038
2,523,019
Contract asset – unbilled current
portion
160,749
186,959
Prepaid expense and other current
assets
316,473
573,763
Total Current Assets
27,196,488
27,274,620
Property and equipment, net
844,705
986,300
Other Assets:
Deposits and other assets
22,414
22,414
Prepaid expense – less current portion
21,147
36,282
Contract asset – unbilled long-term
portion
108,052
108,052
Operating lease – right-of-use asset
295,967
310,796
Customer relationships
229,950
262,800
Goodwill
20,883,886
20,883,886
Capitalized software costs, net
619,866
698,281
Total Other Assets
22,181,282
22,322,511
Total Assets
$
50,222,475
$
50,583,431
Liabilities and Shareholders’
Equity
Current liabilities
Accounts payable
$
314,888
$
431,387
Accrued liabilities
1,608,640
1,620,000
Contract liability – deferred revenue
2,080,424
1,903,001
Operating lease liability – current
60,063
58,771
Notes payable and financing leases –
current
214,926
219,262
Total current liabilities
4,278,941
4,232,421
Long-term liabilities
Operating lease liability – less current
portion
247,537
263,047
Notes payable and financing leases – less
current portion
81,534
206,032
Total liabilities
4,608,012
4,701,500
Commitments and contingencies
Stockholders’ equity:
Preferred Stock; $0.01 par value,
30,000,000 shares authorized;
Series B Preferred, 700,000 shares
authorized; 625,375 shares issued and outstanding at September 30,
2023 and June 30, 2023;
6,254
6,254
Series B-1 Preferred, 550,000 shares
authorized; 212,402 shares issued and outstanding at September 30,
2023 and June 30, 2023, respectively
2,124
2,124
Common Stock, $0.01 par value, 50,000,000
shares authorized; 18,171,068 and 18,309,051 issued and outstanding
at September 30, 2023 and June 30, 2023, respectively
181,713
183,093
Additional paid-in capital
66,507,428
67,732,887
Accumulated deficit
(21,083,056
)
(22,042,427
)
Total stockholders’
equity
45,614,463
45,881,931
Total liabilities and stockholders’
equity
$
50,222,475
$
50,583,431
PARK CITY GROUP, INC. AND
SUBSIDIARIES
Consolidated Statements of
Operations
Three Months Ended
September 30,
2023
2022
Revenue
$
5,060,112
$
4,720,477
Operating expense:
Cost of revenue and product support
766,334
832,704
Sales and marketing
1,505,501
1,200,259
General and administrative
1,279,323
1,223,462
Depreciation and amortization
308,945
236,006
Total operating expense
3,860,103
3,492,431
Income from operations
1,200,009
1,228,046
Other income (expense):
Interest income
258,161
79,092
Interest expense
(6,344
)
(24,652
)
Unrealized gain (loss) on short term
investments
27,186
(7,415
)
Other gain (loss)
-
70,047
Income before income taxes
1,479,012
1,345,118
(Provision) for income taxes:
(100,464
)
(60,006
)
Net income
1,378,548
1,285,112
Dividends on preferred stock
(146,611
)
(146,611
)
Net income applicable to common
shareholders
$
1,231,937
$
1,138,501
Weighted average shares, basic
18,225,000
18,465,000
Weighted average shares, diluted
18,839,000
18,753,000
Basic income per share
$
0.07
$
0.06
Diluted income per share
$
0.07
$
0.06
PARK CITY GROUP, INC. AND
SUBSIDIARIES
Consolidated Statements of
Cash Flows
Three Months Ended
September 30,
2023
2022
Cash flows from operating activities:
Net income
$
1,378,548
$
1,285,112
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
308,945
236,006
Amortization of operating right of use
asset
14,829
14,142
Stock compensation expense
85,375
111,046
Bad debt expense
75,000
150,000
(Increase) decrease in:
Accounts receivables
(547,809
)
(255,281
)
Long-term receivables, prepaids and other
assets
216,340
434,448
Increase (decrease) in:
Accounts payable
(116,499
)
(264,711
)
Operating lease liability
(57,164
)
(13,003
)
Accrued liabilities
(14,218
)
(58,182
)
Deferred revenue
177,423
171,898
Net cash provided by operating
activities
1,520,770
1,811,475
Cash flows from investing activities:
Purchase of property and equipment
-
(19,533
)
Net cash provided by (used in)
investing activities
-
(19,533
)
Cash flows from financing activities:
Net (decrease) increase in lines of
credit
-
(1,294,317
)
Common Stock buyback/retirement
(1,322,082
)
(103,657
)
Proceeds from employee stock plan
57,743
48,903
Dividends paid
(421,248
)
(146,611
)
Payments on notes payable and capital
leases
(128,834
)
(129,481
)
Net cash used in financing
activities
(1,814,421
)
(1,625,163
)
Net increase (decrease) in cash and
cash equivalents
(293,651
)
166,779
Cash and cash equivalents at beginning of
period
23,990,879
21,460,948
Cash and cash equivalents at end of
period
$
23,697,228
$
21,627,727
Supplemental disclosure of cash flow
information:
Cash paid for income taxes
$
221,661
$
146,723
Cash paid for interest
$
2,329
$
24,653
Cash paid for operating leases
$
18,141
$
17,613
Supplemental disclosure of non-cash
investing and financing activities:
Common stock to pay accrued
liabilities
$
37,500
$
76,873
Dividends accrued on preferred stock
$
146,611
$
146,611
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231114951385/en/
Investor Relations Contact: John Merrill, CFO
Investor-relations@repositrak.com
Or
FNK IR Rob Fink 646.809.4048 rob@fnkir.com
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