Business Wire | Nov 16, 2020 08:30AM EST

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

Nov. 16, 2020

SALT LAKE CITY--(BUSINESS WIRE)--Nov. 16, 2020--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)

September 30, June 30,Assets 2020 2020

Current Assets

Cash $ 21,158,716 $ 20,345,330

Receivables, net of allowance for doubtfulaccounts of $376,954 and $251,954 at 3,895,158 4,007,316 September 30, 2020 and June 30, 2020,respectively

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 668,457 479,866 program loans



Total current liabilities 10,164,131 8,912,247



Long-term liabilities

Operating lease liability - less current 673,318 695,369 portion

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 sharesauthorized; 625,375 shares issued and 6,254 6,254 outstanding at September 30, 2020 and June30, 2020, respectively

Series B-1 Preferred, 550,000 sharesauthorized; 212,402 shares issued and 2,124 2,124 outstanding at September 30, 2020 and June30, 2020, respectively

Common Stock, $0.01 par value, 50,000,000shares authorized: 19,499,767 and19,484,485 issued and outstanding at 195,000 194,847 September 30, 2020 and June 30, 2020,respectively

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 (16,263 ) - investments



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 691,245 730,563 assets

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 813,386 (313,980 )equivalents



Cash and cash equivalents at beginning of 20,345,330 18,609,423 period

Cash and cash equivalents at end of period $ 21,158,716 $ 18,295,443



View source version on businesswire.com: https://www.businesswire.com/news/home/20201116005371/en/

CONTACT: Investor Relations: John Merrill, CFO investor-relations@parkcitygroup.com Or FNK IR Rob Fink 646.809.4048 rob@fnkir.com