Record 29% Growth in Core Supply Chain Subscription Revenue
Total Revenue Increases 20% to Record Level
ReposiTrak on Plan to Have 2,000 Connections by Mid-2015
SALT LAKE CITY, Nov. 6, 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 financial results for its fiscal first quarter-ended September 30, 2014.
Strategic and Financial highlights:
- Record subscription and record total revenue – For the quarter ended September 30, 2014, the Company posted year-over-year growth in subscription revenue of 24%. Total revenue grew 20% to a record level of $3.3 million.
- Record 29% growth in core supply chain subscription revenue – "Subscription revenue, net of ReposiTrak-related revenue, grew at a record pace of 29% during the quarter. By delivering on our brand promise to help customers 'Sell more, Stock less and See everything,' we continue to drive expansion among existing customers," said Randall K. Fields, Park City Group's Chairman and CEO. "As we anticipated, recurring revenue is clearly accelerating, and we continue to expect faster annual growth rates in each of the next several years."
- Significant improvement in profitability and cash flow – For the quarter ended September 30, 2014, the Company posted $303,000 in adjusted EBITDA, a $747,000 improvement from the same period a year ago. Free cash flow for the fiscal first quarter of 2015 was $479,000, a $1.1 million improvement from the first quarter of the prior year. "We continue to expect that the rate of revenue growth will significantly outpace the growth in costs," said Mr. Fields. "We expect to be a cash flow generator during the balance of fiscal 2015, and feel that our net cash position is adequate to fund our growth plans."
A Subscription Revenue Growth chart is available here: http://media.globenewswire.com/cache/14562/file/30040.pdf
Total operating expenses during the quarter ended September 30, 2014 were $3.8 million, a decrease of $57,000 from the same quarter a year ago. Non-GAAP income per share to common shareholders for the third quarter was $0.01 per share, as compared to a net loss per share of ($0.04) during the same period last year. GAAP net loss per share to common shareholders for the third quarter was ($0.03) per share, as compared to a net loss per share of ($0.07) during the same period last year.
Total cash at the end of September 30, 2014 was $3.3 million as compared to $3.4 million at June 30, 2014, and debt levels decreased to $1.8 million, versus $1.9 million at June 30, 2014.
ReposiTrak® highlights: ReposiTrak, the Company's collaboration with Leavitt Partners, provides food and drug retailers and their suppliers with a cost-effective service to help protect their brands, and reduce regulatory and financial risk associated with the rapidly evolving Food Safety Modernization Act.
- Upstream suppliers begin adoption of ReposiTrak – ReposiTrak recently announced that the first two upstream food suppliers to its wholesaler customers have begun to deploy its food safety services. These two upstream food suppliers plan to deploy ReposiTrak throughout their own supply chain, which has nearly 600 vendors combined.
- Sixth member of leading supermarket group adopts ReposiTrak - The sixth member of the Retailer Owned Food Distributors & Associates (ROFDA), a cooperative of 13 wholesale members that represent 20% of the supermarket industry, has chosen ReposiTrak to manage their food safety-related risk.
"ReposiTrak is on plan to add two additional wholesalers and/or retailers, and have 2,000 connections by June of next year," said Mr. Fields.
The Company will host a conference call at 4:15 P.M. Eastern today, November 6, 2014, to discuss the results. Investors and interested parties may participate in the call by dialing (877) 675-3568 and referring to Conference ID: 17913698. 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 a 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 | ||
| September 30, | June 30, | |
| 2014 | 2014 | |
| Assets | (unaudited) | |
| Current assets: | ||
| Cash and cash equivalents | $ 3,277,949 | $ 3,352,559 |
| Receivables, net of allowance of $75,000 and $70,000 at September 30, 2014 and June 30, 2014, respectively | 2,635,208 | 2,857,983 |
| Prepaid expenses and other current assets | 324,824 | 250,855 |
| Total current assets | 6,237,981 | 6,461,397 |
| Property and equipment, net | 667,934 | 740,753 |
| Other assets: | ||
| Deposits and other assets | 14,866 | 14,866 |
| Note receivable | 3,458,111 | 2,996,664 |
| Customer relationships | 1,812,440 | 1,918,019 |
| Goodwill | 4,805,933 | 4,805,933 |
| Capitalized software costs, net | -- | -- |
| Total other assets | 10,091,350 | 9,735,482 |
| Total assets | $ 16,997,265 | $ 16,937,632 |
| Liabilities and Stockholders' Equity | ||
| Current liabilities: | ||
| Accounts payable | $ 905,412 | $ 738,289 |
| Accrued liabilities | 1,566,816 | 1,801,355 |
| Deferred revenue | 1,754,234 | 1,840,811 |
| Line of credit | 1,200,000 | 1,200,000 |
| Notes payable | 169,412 | 226,900 |
| Total current liabilities | 5,595,874 | 5,807,355 |
| Long-term liabilities: | ||
| Notes payable, less current portion | 381,751 | 422,248 |
| Other long-term liabilities | 87,433 | 88,948 |
| Total liabilities | 6,065,058 | 6,318,551 |
| 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 September 30, 2014 and June 30, 2014. | 4,119 | 4,119 |
| Common Stock, $0.01 par value, 50,000,000 shares authorized; 17,106,645 and 16,928,025 shares issued and outstanding at September 30, 2014 and June 30, 2014, respectively | 171,066 | 169,280 |
| Additional paid-in capital | 47,634,612 | 46,792,736 |
| Accumulated deficit | (36,877,590) | (36,347,054) |
| Total stockholders' equity | 10,932,207 | 10,619,081 |
| Total liabilities and stockholders' equity | $ 16,997,265 | $ 16,937,632 |
| See accompanying notes to consolidated condensed financial statements. | ||
| PARK CITY GROUP, INC. | ||
| Consolidated Condensed Statements of Operations (Unaudited) | ||
| Three Months Ended | ||
| September 30, | ||
| 2014 | 2013 | |
| Revenues: | ||
| Subscription | $ 2,637,084 | $ 2,134,656 |
| Other Revenue | 696,435 | 641,280 |
| Total revenues | 3,333,519 | 2,775,936 |
| Operating expenses: | ||
| Cost of services and product support | 1,348,379 | 1,209,103 |
| Sales and marketing | 1,337,435 | 1,239,643 |
| General and administrative | 894,972 | 1,148,473 |
| Depreciation and amortization | 187,395 | 227,575 |
| Total operating expenses | 3,768,181 | 3,824,794 |
| (Loss) income from operations | (434,662) | (1,048,858) |
| Other expense: | ||
| Interest income (expense) | 58,599 | 1,493 |
| (Loss) income before income taxes | (376,063) | (1,047,365) |
| (Provision) benefit for income taxes: | -- | -- |
| Net (loss) income | (376,063) | (1,047,365) |
| Dividends on preferred stock | (154,473) | (154,473) |
| Net (loss) applicable to common shareholders | $ (530,536) | $ (1,201,838) |
| Weighted average shares, basic and diluted | 17,088,000 | 16,364,000 |
| Basic and diluted loss per share | $ (0.03) | $ (0.07) |
| See accompanying notes to consolidated condensed financial statements. | ||
| PARK CITY GROUP, INC. | ||
| Consolidated Condensed Statements of Cash Flows (Unaudited) | ||
| Three Months Ended | ||
| September 30, | ||
| 2014 | 2013 | |
| Cash Flows From Operating Activities: | ||
| Net (loss) income | $ (376,063) | $ (1,047,365) |
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
| Depreciation and amortization | 187,395 | 227,575 |
| Stock issued for charitable contribution | -- | 96,900 |
| Stock compensation expense | 543,972 | 375,515 |
| Bad debt expense | 7,033 | -- |
| (Increase) decrease in: | ||
| Receivables | 215,742 | 2,882 |
| Prepaids and other assets | (135,416) | 57,805 |
| (Decrease) increase in: | ||
| Accounts payable | 167,123 | (193,771) |
| Accrued liabilities | (34,778) | 352,126 |
| Deferred revenue | (86,577) | (466,637) |
| Net cash provided by (used in) operating activities | 488,431 | (594,970) |
| Cash Flows From Investing Activities: | ||
| Cash from sales of property and equipment | -- | 6,505 |
| Cash advanced on note receivable | (400,000) | -- |
| Purchase of property and equipment | (8,997) | (66,590) |
| Net cash used in investing activities | (408,997) | (60,085) |
| Cash Flows From Financing Activities: | ||
| Proceeds from issuance of stock | -- | 1,493,818 |
| Proceeds from exercise of options and warrants | -- | 129,043 |
| Proceeds from employee stock plans | 98,414 | 62,134 |
| Proceeds from issuance of note payable | 8,213 | -- |
| Dividends paid | (154,473) | (123,578) |
| Payments on notes payable | (106,198) | (225,678) |
| Net cash provided by financing activities | (154,044) | 1,335,739 |
| Net (decrease) increase in cash and cash equivalents | (74,610) | 680,684 |
| Cash and cash equivalents at beginning of period | 3,352,559 | 3,616,585 |
| Cash and cash equivalents at end of period | $3,277,949 | $ 4,297,269 |
| Supplemental Disclosure of Cash Flow Information: | ||
| Cash paid for income taxes | $ -- | $ 6,500 |
| Cash paid for interest | $ 10,016.00 | $ 31,793.00 |
| Supplemental Disclosure of Non-Cash Investing and Financing Activities: | ||
| Common stock to pay accrued liabilities | $ 745,248 | $ 257,209 |
| Dividends accrued on preferred stock | $ 154,473 | $ 154,473 |
| Dividends paid with preferred stock | $ -- | $ -- |
| See accompanying notes to consolidated condensed financial statements. | ||
| PARK CITY GROUP, INC. AND SUBSIDIARIES | ||
| Reconciliation of GAAP and Non-GAAP Financial Measures | ||
| Adjusted EBITDA | ||
| (In $000's) | ||
|
Three Months Ended September 30, |
||
| 2014 | 2013 | |
| Net Loss | $ (376) | $ (1,047) |
| Adjusted EBITDA Reconciliation Adjustments: | ||
| Depreciation and amortization | 187 | 228 |
| Bad debt expense | 7 | -- |
| Interest, net | (59) | (1) |
| Stock based compensation | 544 | 376 |
| Adjusted EBITDA | $ 303 | $ (444) |
| Non-GAAP Net Income (Loss) to Common Shareholders and EPS | ||
| (In $000's, except per share) | ||
|
Three Months Ended September 30, |
||
| 2014 | 2013 | |
| Net (loss) income | $ (376) | $ (1,047) |
| Non-GAAP Net (Loss) Income Reconciliation Adjustments: | ||
| Stock based compensation | 544 | 376 |
| Acquisition related amortization | 106 | 126 |
| Non-GAAP Net Income | $ 274 | $ (545) |
| Preferred dividends | (154) | (154) |
| Non-GAAP Net Income to Common Shareholders | $ 120 | $ (699) |
| Weighted average shares, diluted | 17,088,000 | 16,364,000 |
| Non-GAAP EPS, diluted | $ 0.01 | $ (0.04) |
| Non-GAAP Free Cash Flow | ||
| (In $000's) | ||
|
Three Months Ended September 30, |
||
| 2014 | 2013 | |
| Net Cash Provided by Operating Activities | $ 488 | $ (595) |
| Non-GAAP Free Cash Flow Reconciliation Adjustments: | ||
| Purchase of property and equipment | (9) | (67) |
| Non-GAAP Free Cash Flow | $ 479 | $ (662) |
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.
