Park City Group Reports 9% Increase in Revenue, Net Income More than Triples for Fiscal First Quarter 2021

Park City Group, Inc. (NASDAQ: PCYG), the parent company of ReposiTrak, Inc., which operates a B2B ecommerce, compliance, and supply chain platform that partners with retailers, wholesalers, and their suppliers, to accelerate sales, control risk, and improve supply chain efficiencies, today announced financial results for the first fiscal quarter ended September 30, 2020.

First Quarter Financial and Recent Business Highlights:

  • Total revenue increased to $5.23 million from $4.80 million, a 9% year-over-year increase resulting from higher MarketPlace revenue and recurring SaaS revenue.
  • Operating expense decreased 1% year-over-year.
  • GAAP net income up 212% to $555,000 vs. $178,000.
  • Net income to common shareholders of $408,000 vs. $32,000.
  • EPS $0.02 vs. $0.00 in the prior year first quarter.

Randall K. Fields, Chairman and CEO of Park City Group commented, “We grew revenue in both our SaaS offerings which includes supply chain and compliance, and delivered double-digit growth in MarketPlace as customers continue to utilize our platform for safely sourcing hard-to-find items. The result was a 9% consolidated revenue growth, which is noteworthy considering the pandemic business environment. We achieved these results while simultaneously decreasing selling, general, and administrative expenses by more than $270,000 compared to last year.”

“The pandemic-related challenges within the supply chain continue to serve as tailwinds for our MarketPlace offering for the foreseeable future,” continued Mr. Fields. “We are beginning to secure opportunities beyond the traditional grocery sector. Government entities are evaluating MarketPlace as a platform to help source COVID and other emergency supplies, personal protective apparel, and other high-demand items. Our pipeline of potential opportunities in the government sector is growing.”

“Simultaneously, we continue to grow our SaaS offerings, which give us greater long-term visibility into our predictable results as the economy begins to normalize,” added Mr. Fields. “The growing base of recurring SaaS revenue enables consistent profitability, as evidenced by our more than ten-fold improvement in net income to common shareholders. In addition, we delivered a $2.9 million, or 16%, year-over-year increase in our net cash generated in the quarter, giving us a strong start in the new fiscal year. Our customers continue to navigate unprecedented challenges, impacting our sales cycle, but we continue to adapt our cost structure and believe we are well-positioned for the balance of our fiscal year.”

First Quarter Financial Results (three months ended September 30, 2020 vs. three months ended September 30, 2019):

Total revenue increased 9% to $5.23 million as compared to $4.80 million due to growth in MarketPlace revenue and a 6% increase in recurring revenue. Total operating expense was $4.6 million, a 1.4% decrease from $4.7 million. GAAP net income was $555,000, or 10.6% of revenue, versus $178,000, or 3.7% of revenue, and GAAP net income to common shareholders was $408,000, or $0.02 per diluted share, compared to $32,000, or $0.00 per diluted share.

Balance Sheet:

The Company had $21.2 million in cash and cash equivalents at September 30, 2020, compared to $20.3 million at June 30, 2020.

Conference Call:

The Company will host a conference call at 4:15 p.m. Eastern today. 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: Monday, November 16th

Time: 4:15 p.m. ET (1:15 p.m. PT)

Toll-Free 1-877-407-9716

Toll/International 1-201-493-6779

Conference ID: 13713020

Replay Dial-In Numbers:

Toll-Free 1-844-512-2921

Toll/International 1-412-317-6671

From: 11/16/20 @ 7:15 p.m. Eastern Time

To: 12/16/20 @ 11:59 p.m. Eastern Time

Replay Pin Number: 13713020

About Park City Group:

Park City Group, Inc. (NASDAQ:PCYG), the parent company of ReposiTrak, Inc., a compliance, supply chain, and e-commerce platform that enables retailers, wholesalers, and their suppliers, to accelerate sales, control risk, and improve supply chain efficiencies. More information is available at www.parkcitygroup.com and 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 September 30, 2019 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”) 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’s 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)

Assets

September 30,

2020

June 30,

2020

Current Assets

Cash

$

21,158,716

$

20,345,330

Receivables, net of allowance for doubtful accounts of $376,954 and $251,954 at September 30, 2020 and June 30, 2020, respectively

3,895,158

4,007,316

Contract asset – unbilled current portion

2,899,819

2,300,754

Prepaid expense and other current assets

594,245

495,511

Total Current Assets

28,547,938

27,148,911

Property and equipment, net

2,872,805

3,003,402

Other Assets:

Deposits, and other assets

22,414

22,414

Prepaid expense – less current portion

62,919

77,030

Contract asset – unbilled long-term portion

542,170

838,726

Operating lease – right-of-use asset

760,172

781,137

Customer relationships

624,150

657,000

Goodwill

20,883,886

20,883,886

Capitalized software costs, net

9,269

18,539

Total Other Assets

22,904,980

23,278,732

Total Assets

$

54,325,723

$

53,431,045

Liabilities and Shareholders’ Equity

Current liabilities

Accounts payable

$

465,012

$

407,497

Accrued liabilities

1,712,342

1,123,528

Contract liability – deferred revenue

1,951,467

1,845,347

Lines of credit

5,280,000

4,660,000

Operating lease liability – current

86,853

85,767

Current portion of notes payable

-

310,242

Current portion of paycheck protection program loans

668,457

479,866

Total current liabilities

10,164,131

8,912,247

Long-term liabilities

Operating lease liability – less current portion

673,318

695,369

Notes payable – less current portion

-

610,512

Paycheck protection program loans

440,893

629,484

Total liabilities

11,278,342

10,847,612

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, 2020 and June 30, 2020, respectively

6,254

6,254

Series B-1 Preferred, 550,000 shares authorized; 212,402 shares issued and outstanding at September 30, 2020 and June 30, 2020, respectively

2,124

2,124

Common Stock, $0.01 par value, 50,000,000 shares authorized: 19,499,767 and 19,484,485 issued and outstanding at September 30, 2020 and June 30, 2020, respectively

195,000

194,847

Additional paid-in capital

75,326,677

75,271,097

Accumulated deficit

(32,482,674

)

(32,890,889

)

Total stockholders’ equity

43,047,381

42,583,433

Total liabilities and stockholders’ equity

$

54,325,723

$

53,431,045

PARK CITY GROUP, INC.

Consolidated Condensed Statements of Operations (Unaudited)

Three Months Ended

September 30,

2020

2019

Revenue:

$

5,225,402

$

4,800,084

Operating expense:

Cost of services and product support

1,980,957

1,828,114

Sales and marketing

1,283,041

1,414,863

General and administrative

1,081,925

1,222,212

Depreciation and amortization

248,500

193,677

Total operating expense

4,594,423

4,658,866

Income from operations

630,979

141,218

Other income (expense):

Interest income

34,341

82,731

Interest expense

(70,545

)

(20,598

)

Unrealized gain (loss) on short term investments

(16,263

)

-

Income before income taxes

578,512

203,351

(Provision) for income taxes:

(23,686

)

(25,000

)

Net income

554,826

178,351

Dividends on preferred stock

(146,611

)

(146,611

)

Net income applicable to Common Stockholders

$

408,215

$

31,740

Weighted average shares, basic

19,489,000

19,811,000

Weighted average shares, diluted

19,642,000

20,122,000

Basic income per share

$

0.02

$

0.00

Diluted income per share

$

0.02

$

0.00

PARK CITY GROUP, INC.

Consolidated Condensed Statements of Cash Flows (Unaudited)

Three Months Ended

September 30,

2020

2019

Cash flows from operating activities:

Net income

$

554,826

$

178,351

Adjustments to reconcile net income to net cash used in operating activities:

Depreciation and amortization

248,500

193,677

Amortization of operating right-of-use asset

20,965

-

Stock compensation expense

93,432

119,567

Bad debt expense

125,000

125,000

(Increase) decrease in:

Accounts receivables

(1,154,077

)

(321,246

)

Long-term receivables, prepaid and other assets

691,245

730,563

Right-of-use asset

-

(842,689

)

(Decrease) increase in:

Accounts payable

57,515

(89,198

)

Accrued liabilities

501,063

(261,758

)

Operating lease liability

(20,965

)

842,689

Deferred revenue

105,844

37,638

Net cash provided by operating activities

1,223,348

712,594

Cash flows from investing activities:

Purchase of property and equipment

(12,925

)

(353,706

)

Net cash used in investing activities

(12,925

)

(353,706

)

Cash flows financing activities:

Net increase in lines of credit

620,000

-

Common Stock buyback/retirement

-

(517,360

)

Proceeds from employee stock plans

50,328

63,523

Dividends paid

(146,611

)

(146,611

)

Payments on notes payable and capital leases

(920,754

)

(72,420

)

Net cash used in financing activities

(397,037

)

(672,868

)

Net (decrease) increase in cash and cash equivalents

813,386

(313,980

)

Cash and cash equivalents at beginning of period

20,345,330

18,609,423

Cash and cash equivalents at end of period

$

21,158,716

$

18,295,443

Contacts:

Investor Relations:
John Merrill, CFO
investor-relations@parkcitygroup.com

Or

FNK IR
Rob Fink
646.809.4048
rob@fnkir.com

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