SALT LAKE CITY, Sept. 11, 2014 (GLOBE NEWSWIRE) -- Park City Group (Nasdaq:PCYG), a cloud-based software company that uses big data management to help retailers and their suppliers "Sell More, Stock Less, and See Everything", today announced results for its fiscal year-ended June 30, 2014.
Strategic and Financial highlights:
- Record annual subscription revenue – Subscription revenue increased at a record annual pace of 17% to $9.4 million for fiscal year-ended June 30, 2014. "Our record growth rate was driven by the strategy we adopted to focus our resources on new business development with larger retailers and suppliers. Our intent is to continue to execute against that strategy, and continue extend our industry reach," said Randall K. Fields, Park City Group's Chairman and CEO.
- Large international retailer trial exceeds expectations – Successful results achieved during recently completed tests are expected to accelerate the use and expansion of Park City Group's services among large retailers and suppliers. "Results of the trial we completed this year clearly validate our brand promise to 'Sell More, Stock Less, and See Everything'. Park City Group enabled trial participants to achieve significant sales increases, as much as a 50% reduction in waste and improved inventory turns," said Mr. Fields. "Our most important accomplishment last year was our customers' success, which is enhancing our reputation and generating a network growth effect in our business… more retailers connecting to more suppliers… both using more services."
- Strategic relationships to accelerate growth – The Company announced an additional strategy to accelerate growth by forming strategic alliances to extend the reach of its supply chain services into a substantially larger number of new customers. "With these new strategic relationships and the continued success of our programs at larger retailers and suppliers, we expect subscription revenue growth of our supply chain services to continue to accelerate during fiscal 2015," said Mr. Fields.
- ReposiTrak™ connections accelerate – During the fiscal year, ReposiTrak made significant progress in establishing itself as the industry standard food safety platform. "Recent developments are continuing to support the business case for the use of ReposiTrak by participants in the global food supply chain. Lawsuits were recently settled by a high-profile international retailer, which creates a new liability retailers face when they sell a product; and the FDA has indicated additional regulations will be published, which further establish the need for a system such as ReposiTrak," said Mr. Fields. "To facilitate the growing pipeline of supplier connections, ReposiTrak made significant enhancements to its on-boarding process this year. In addition, ReposiTrak is exploring several strategic relationships that would effectively subsidize the cost of participation and thereby further accelerate adoption of its services."
Total operating expenses during the fiscal year-ended June 30, 2014 were $14.5 million, an increase of $3.6 million from the prior year. The majority of the increase in operating expenses reflects increased sales, marketing and account management costs. "With costs expected to be relatively flat over the next several quarters, a large portion of each incremental sales dollar should fall to the bottom line and allow for continued improvements in profit margin and cash flows," said Mr. Fields.
Net loss applicable to common shareholders for the fiscal year-ended June 30, 2014 was ($3.1 million), as compared to a net loss of ($654,000) during the prior year period. Non-GAAP loss per common shareholder for the fiscal year was ($0.05), versus non-GAAP net income per share of $0.05 during the prior year.
Cash
Total cash at the end of June 30, 2014 was $3.4 million as compared to $3.6 million at June 30, 2013, and debt levels decreased to $1.9 million, versus $2.2 million at the same time last year.
"This past year, we delivered on our brand promise to our customers by enabling them to 'Sell More, Stock Less, and See Everything'. As a result, we are entering 2015 with increased customer satisfaction, a stronger pipeline and a number of potential strategic relationships that positions the next several years for accelerated growth," concluded Mr. Fields.
The Company will host a conference call at 4:15 P.M. Eastern today, September 11, 2014, to discuss the results. Investors and interested parties may participate in the call by dialing (877) 675-3568 and referring to Conference ID: 93250811. The conference call is also being webcast and is available via the investor relations section of the Company's website, www.parkcitygroup.com.
About Park City Group
Park City Group (Nasdaq:PCYG) is a Software-as-a-Service ("SaaS") provider that brings unique visibility to the consumer goods supply chain, delivering actionable information that ensures product is on the shelf when the consumer expects it to be. Park City Group's services enable customers to "Sell More, Stock Less, and See Everything". More information is available at www.parkcitygroup.com
About ReposiTrak
ReposiTrak is collaboration between Leavitt Partners and Park City Group. ReposiTrak provides food retailers and suppliers with a robust solution to help protect their brands and remain in compliance with rapidly evolving regulations in the Food Safety Modernization Act. Powered by Park City Group's technology, the ReposiTrak® solution is internet-based and enables all participants in the farm-to-shelf supply chain easily manage both document management and tracking and traceability requirements as products move between trading partners. More information is available at www.repositrak.com.
Non-GAAP Financial Measures
This press release includes the following financial measures defined as "non-GAAP financial measures" by the Securities and Exchange Commission: non-GAAP EBITDA, non-GAAP earnings per share, net debt and free cash flow. These measures may be different from non-GAAP financial measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles. Reconciliations of these non-GAAP financial measures to the nearest comparable GAAP measures will be provided upon the completion of the Company's annual audit.
Non-GAAP EBITDA excludes items such as impairment charges, allowance for doubtful accounts, charges to consolidate and integrate recently acquired businesses, costs of closing corporate facilities, non-cash stock based compensation and other one-time cash and non-cash charges. Non-GAAP EPS excludes items such as non-cash stock based compensation, charges to consolidate and integrate recently acquired businesses, costs for closing corporate facilities, amortization of acquired intangible assets and other one-time cash and non-cash charges. Net debt is the total debt balance less the cash balance. Free cash flow includes net cash provided (used) by operating activities less replacement purchases of property and equipment. The Company believes the non-GAAP measures provide useful information to both management and investors by excluding certain expenses, gains and losses or net purchases of property and equipment, as the case may be, which may not be indicative of its core operation results and business outlook. In addition, because Park City Group has historically reported certain non-GAAP results to investors, the Company believes that the inclusion of non-GAAP measures provides consistency in the Company's financial reporting.
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 | ||
| Assets | June 30, 2014 | June 30, 2013 |
| Current Assets: | ||
| Cash and cash equivalents | $ 3,352,559 | $ 3,616,585 |
| Receivables, net of allowance of $70,000 and $190,000 at June 30, 2014 and 2013, respectively | 2,857,983 | 2,383,366 |
| Prepaid expense and other current assets | 250,855 | 403,909 |
| Total current assets | 6,461,397 | 6,403,860 |
| Property and equipment, net | 740,753 | 671,959 |
| Other assets: | ||
| Deposits and other assets | 14,866 | 14,866 |
| Note receivable | 2,996,664 | 1,622,863 |
| Customer relationships | 1,918,019 | 2,340,335 |
| Goodwill | 4,805,933 | 4,805,933 |
| Capitalized software costs, net | -- | 73,082 |
| Total other assets | 9,735,482 | 8,857,079 |
| Total assets | $ 16,937,632 | $ 15,932,898 |
| Liabilities and Stockholders' Equity | ||
| Current liabilities: | ||
| Accounts payable | $ 738,289 | $ 653,655 |
| Accrued liabilities | 1,801,355 | 1,096,982 |
| Deferred revenue | 1,840,811 | 1,777,326 |
| Line of credit | 1,200,000 | 1,200,000 |
| Note payable | 226,900 | 551,421 |
| Total current liabilities | 5,807,355 | 5,279,384 |
| Long-term liabilities: | ||
| Notes payable, less current portion | 422,248 | 310,642 |
| Other long-term liabilities | 88,948 | 101,500 |
| Total liabilities | 6,318,551 | 5,691,526 |
| Commitments and contingencies | ||
| Stockholders' equity: | ||
| Series B Convertible Preferred stock, $0.01 par value, 30,000,000 shares authorized; 411,927 shares issued and outstanding at June 30, 2014 and 2013 | 4,119 | 4,119 |
| Common stock, $0.01 par value, 50,000,000 shares authorized; 16,928,025 and 16,128,530 issued and outstanding at June 30, 2014 and 2013, respectively | 169,280 | 161,285 |
| Additional paid-in capital | 46,792,736 | 43,314,986 |
| Accumulated deficit | (36,347,054) | (33,239,018) |
| Total stockholders' equity | 10,619,081 | 10,241,372 |
| Total liabilities and stockholders' equity | $ 16,937,632 | $ 15,932,898 |
| PARK CITY GROUP, INC. | ||||
| Consolidated Condensed Statements of Operations (unaudited) | ||||
| Three Months Ended | Twelve Months Ended | |||
| June 30, | June 30, | |||
| 2014 | 2013 | 2014 | 2013 | |
| Revenues: | ||||
| Subscription | $ 2,429,771 | $ 2,107,047 | $ 9,398,377 | $ 8,025,025 |
| Other revenue | 614,598 | 792,810 | 2,530,039 | 3,293,549 |
| Total revenues | 3,044,369 | 2,899,857 | 11,928,416 | 11,318,574 |
| Operating expenses: | ||||
| Cost of services and product support | 1,295,609 | 1,169,148 | 5,087,973 | 4,490,438 |
| Sales and marketing | 1,298,899 | 963,584 | 4,741,574 | 3,054,361 |
| General and administrative | 779,423 | 612,120 | 3,812,265 | 2,474,169 |
| Depreciation and amortization | 199,366 | 218,282 | 879,329 | 901,407 |
| Total operating expenses | 3,573,297 | 2,963,134 | 14,521,141 | 10,920,375 |
| (Loss) income from operations | (528,928) | (63,277) | (2,592,725) | 398,199 |
| Other income (expense): | ||||
| Interest income (expense) | 42,653 | (29,063) | 102,580 | (140,712) |
| (Loss) income before income taxes | (486,275) | (92,340) | (2,490,145) | 257,487 |
| (Provision) benefit for income taxes: | -- | -- | -- | -- |
| Net (loss) income | (486,275) | (92,340) | (2,490,145) | 257,487 |
| Dividends on preferred stock | (154,472) | (123,578) | (617,891) | (911,580) |
| Net loss applicable to common shareholders | $ (640,747) | $ (215,918) | $ (3,108,036) | $ (654,093) |
| Weighted average shares, basic and diluted | 16,921,000 | 15,734,000 | 16,710,000 | 13,246,000 |
| Basic and diluted loss per share | $ (0.04) | $ (0.01) | $ (0.19) | $ (0.05) |
| PARK CITY GROUP, INC. | ||
| Consolidated Condensed Statements of Cash Flows (Unaudited) | ||
| For the 12 months Ended | ||
| June 30, | ||
| 2014 | 2013 | |
| Cash Flows from Operating Activities: | ||
| Net (loss) income | $ (2,490,145) | $ 257,487 |
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
| Depreciation and amortization | 879,329 | 901,407 |
| Bad debt expense | 186,740 | 144,617 |
| Stock compensation expense | 1,719,375 | 843,645 |
| Stock issued for charitable contribution | 96,900 | -- |
| Decrease (increase) in: | ||
| Receivables | (661,357) | (1,859,987) |
| Prepaids and other assets | (20,747) | (226,552) |
| Increase (decrease) in: | ||
| Accounts payable | 84,634 | 102,809 |
| Accrued liabilities | 49,252 | (8,357) |
| Deferred revenue | 63,485 | (304,133) |
| Net cash used in operating activities | (92,534) | (149,064) |
| Cash Flows From Investing Activities: | ||
| Purchase of property and equipment | (459,230) | (445,744) |
| Cash advanced on note receivable | (1,200,000) | -- |
| Cash from sale of property and equipment | 6,505 | -- |
| Net cash used in investing activities | (1,652,725) | (445,744) |
| Cash Flows From Financing Activities: | ||
| Proceeds from issuance of stock | 1,493,818 | 4,162,920 |
| Proceeds from exercise of options and warrants | 633,454 | -- |
| Proceeds from issuance of notes payable | 338,287 | 176,797 |
| Proceeds from employee stock plans | 153,875 | 156,741 |
| Series A redemption | -- | (21,720) |
| Dividends paid | (586,999) | (503,311) |
| Payments on notes payable | (551,202) | (866,210) |
| Net cash provided by financing activities | 1,481,233 | 3,105,217 |
| Net (decrease) increase in cash and cash equivalents | (264,026) | 2,510,409 |
| Cash and cash equivalents at beginning of period | 3,616,585 | 1,106,176 |
| Cash and cash equivalents at end of period | $ 3,352,559 | $ 3,616,585 |
| Supplemental Disclosure of Cash Flow Information | ||
| Cash paid for income taxes | $ 6,634 | $ -- |
| Cash paid for interest | $ 75,343 | $ 142,491 |
| Common Stock to pay accrued liabilities | $ 1,107,698 | $ 786,343 |
| Dividends accrued on preferred stock | $ 617,891 | $ 911,580 |
| Dividends paid with preferred stock | $ -- | $ 501,060 |
| Conversion of accounts receivable into notes receivable | $ -- | $ 1,622,863 |
| PARK CITY GROUP, INC. AND SUBSIDIARIES | ||||
| Reconciliation of GAAP and Non-GAAP Financial Measures | ||||
| Adjusted EBITDA | ||||
| (In $000's) | ||||
| Three Months Ended June 30, | Twelve Months Ended June 30, | |||
| 2014 | 2013 | 2014 | 2013 | |
| Net Income (loss) | ($486) | ($92) | ($2,490) | $257 |
| Adjusted EBITDA Reconciliation Adjustments: | ||||
| Depreciation and amortization | 199 | 218 | 879 | 901 |
| Bad debt expense | 15 | 64 | 187 | 145 |
| Interest, net | (43) | 29 | (103) | 141 |
| Stock based compensation | 395 | 182 | 1,719 | 844 |
| Adjusted EBITDA | $80 | $401 | $192 | $2,288 |
| Non-GAAP Net Income (Loss) to Common Shareholders and EPS | ||||
| (In $000's, except per share) | ||||
| Three Months Ended June 30, | Twelve Months Ended June 30, | |||
| 2014 | 2013 | 2014 | 2013 | |
| Net (loss) income | ($486) | ($92) | ($2,490) | $257 |
| Non-GAAP Net (Loss) Income Reconciliation Adjustments: | ||||
| Stock based compensation | 395 | 182 | 1,719 | 844 |
| Acquisition related amortization | 106 | 126 | 495 | 504 |
| Non-GAAP Net Income | $15 | $216 | ($276) | $1,605 |
| Preferred dividends | (154) | (124) | (618) | (912) |
| Non-GAAP Net Income to Common Shareholders | ($139) | $92 | ($894) | $693 |
| Weighted average shares, diluted | 16,921,000 | 15,734,000 | 16,710,000 | 13,246,000 |
| Non-GAAP EPS, diluted | ($0.01) | ($0.01) | ($0.05) | $0.05 |
| Non-GAAP Free Cash Flow | ||
| (In $000's) | ||
| Twelve Months Ended June 30, | ||
| 2014 | 2013 | |
| Net Cash Provided by Operating Activities | ($93) | ($149) |
| Non-GAAP Free Cash Flow Reconciliation Adjustments: | ||
| Purchase of property and equipment | (459) | (446) |
| Non-GAAP Free Cash Flow | ($552) | ($595) |
Free cash flow includes net cash provided (used) by operating activities less replacement purchases of property and equipment. Capital expenditures related to long-term investments and new technology developments are omitted. During 2Q13 the Company invested $232,000 in leasehold improvements for its new corporate headquarters located in Salt Lake City, UT, this amount is excluded from the Free Cash Flow calculation.