Business Wire | Sep 28, 2021 04:01PM EDT

Park City Group Reports 158% Increase in Net Income for Fiscal Full-Year 2021

Sep. 28, 2021

SALT LAKE CITY--(BUSINESS WIRE)--Sep. 28, 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, improve supply chain efficiencies, and source hard-to-find items, today announced financial results for the fourth fiscal quarter and full-year period ended June 30, 2021.

Full-Year Financial Highlights:

* Total revenue increased 5% to $21.0 million from $20.0 million in the prior fiscal year due to higher MarketPlace revenue and an increase in SaaS subscription revenue, partially offset by lower one-time revenue. * Recurring SaaS revenue increased 11% to $17.7 million. The annualized run rate (ARR) of recurring revenue exiting the year was $18.4 million. * Total operating expenses declined 2% to $18.1 million from $18.6 million in the prior fiscal year. * GAAP net income increased 158% to $4.1 million vs. GAAP net income of $1.6 million in the prior fiscal year. * Net income to common shareholders of $3.5 million, up 251% compared to $1.0 million last year. * EPS increased 251% to $0.18 vs. $0.05 in the prior fiscal year. * Cash from operations increased 29% to $5.4 million from $4.2 million in the prior fiscal year.

Fourth Quarter Financial Highlights:

* Total revenue decreased 21% to $4.6 million from $5.8 million in the prior fiscal quarter due to lower MarketPlace revenue. * Recurring SaaS revenue increased 8% to $4.5 million. * Total operating expenses declined 35% to $3.4 million from $5.3 million in the prior fiscal quarter due to lower cost of goods associated with lower Marketplace revenue. * GAAP net income increased 143% to $1.2 million vs. GAAP net income of $480,000 in the prior fiscal quarter. * Net income to common shareholders increased 206% to $1.0 million, vs. $333,000 in the prior fiscal quarter. * EPS increased 207% to $0.05 vs. $0.02 in the prior fiscal quarter.

Randall K. Fields, Chairman and CEO of Park City Group commented, "We continue to grow our recurring revenue, our earnings per share and our cash balances. We are laser focused on growing long-term and increasing profitability as we expand our offerings. Recurring revenue increased 11% this year, and our net income grew 158%, enabling us to increase our cash balances by nearly $4 million. We achieved this while simultaneously buying back $1.3 million in common stock - all in the midst of a global pandemic."

"We enter fiscal 2022 with the strongest balance sheet in our history," added Mr. Fields. "Our $17.7 million in base recurring revenue covers our SaaS cash fixed costs. And, we continue to offer a growing portfolio of solutions which our customers need and demand. Our current fiscal year is off to a strong start, with both of our SaaS family of products continuing the momentum from last year. In response to the FDA's traceability rule as part of the Food Safety Modernization Act (FSMA), we are collaborating closely with industry thought leaders to bring a sophisticated and affordable Track and Trace solution to the larger market. Several of our customers have already begun to utilize our traceability solution with their suppliers. We already provide Track and Trace, affordably, effectively and at scale, so we are uniquely qualified to address this traceability requirement - it's what we do."

Fiscal 2021 Full-Year Results (fiscal year ended June 30, 2021 vs. fiscal year ended June 30, 2020):

Total revenue increased 5% to $21.0 million, as compared to $20.0 million last year. Total operating expense was $18.1 million, a decrease of 2% from $18.6 million a year ago. GAAP net income was $4.1 million versus $1.6 million a year ago, and GAAP net income to common shareholders was $3.5 million, or $0.18 per diluted share, compared to $1.0 million, or $0.05 per diluted share, a year ago.

Fourth Quarter Financial Results (three months ended June 30, 2021 vs. three months ended June 30, 2020):

Total revenue decreased 21% to $4.6 million as compared to $5.8 million due largely to decreases in MarketPlace revenue as demand for COVID items began to abate. This is partially offset by an 8% increase in quarterly recurring revenue. Total operating expense decreased 35% to $3.4 million due to a decrease in cost of goods related to the lower MarketPlace revenue. GAAP net income was $1.2 million, versus $480,000. GAAP net income to common shareholders was $1.0 million, or $0.05 per diluted share, compared to $333,000, or $0.02 per diluted share.

Share Repurchases:

In the fourth quarter, the Company repurchased 126,927 shares at an average price of $6.30 for a total of $800,000. To date, the Company has repurchased 710,713 shares at an average price of $5.55 for a total of $3.95 million.

Subsequent to the end of the fiscal year, Park City Group's Board of Directors authorized an additional $12 million buyback.

Balance Sheet:

The Company had $24.0 million in cash and cash equivalents at June 30, 2021, compared to $20.3 million at June 30, 2020, an 18% increase.

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, September 28th 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: 13722947

Replay Dial-In Numbers: Toll Free: 1-844-512-2921 Toll/International: 1-412-317-6671 Replay Start: Tuesday September 28, 2021, 7:15 p.m. ET Replay Expiry: Thursday October 28, 2021, 11:59 p.m. ET Replay Pin Number: 13722947

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 June 30, 2020 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 Balance Sheets

June 30, June 30,Assets 2021 2020

Current Assets

Cash $ 24,070,322 $ 20,345,330

Receivables, net of allowance for doubtfulaccounts of $234,693 and $251,954 at June 3,891,699 4,007,316 30, 2021 and 2020, respectively

Contract asset - unbilled current portion 1,248,936 2,300,754

Prepaid expense and other current assets 490,817 495,511



Total Current Assets 29,701,774 27,148,911



Property and equipment, net 2,589,194 3,003,402



Other Assets:

Deposits, and other assets 22,414 22,414

Prepaid expense - less current portion 47,987 77,030

Contract asset - unbilled long-term portion 408,925 838,726

Operating lease - right-of-use asset 695,371 781,137

Customer relationships 525,600 657,000

Goodwill 20,883,886 20,883,886

Capitalized software costs, net 171,732 18,539



Total Other Assets 22,755,915 23,278,732



Total Assets $ 55,046,883 $ 53,431,045



Liabilities and Shareholders' Equity

Current liabilities

Accounts payable $ 467,194 $ 407,497

Accrued liabilities 988,092 1,123,528

Contract liability - deferred revenue 1,755,341 1,845,347

Lines of credit 6,000,000 4,660,000

Operating lease liability - current 90,156 85,767

Current portion of notes payable - 310,242

Current portion of paycheck protection - 479,866 program loans



Total current liabilities 9,300,783 8,912,247



Long-term liabilities

Operating lease liability - less current 605,214 695,369 portion

Notes payable, less current portion - 610,512

Paycheck protection program loans - 629,484



Total liabilities 9,905,997 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 June 30, 2021 and 2020;

Series B-1 Preferred, 550,000 sharesauthorized; 212,402 shares issued and 2,124 2,124 outstanding at June 30, 2021 and 2020,respectively

Common Stock, $0.01 par value, 50,000,000shares authorized; 19,351,935 and 193,522 194,847 19,484,485 issued and outstanding at June30, 2021 and 2020, respectively

Additional paid-in capital 74,298,924 75,271,097

Accumulated deficit (29,359,938 ) (32,890,889 )



Total stockholders' equity 45,140,886 42,583,433



Total liabilities and stockholders' equity $ 55,046,883 $ 53,431,045

PARK CITY GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Operations

For the Years Ended June 30,

2021 2020



Revenue $ 21,007,076 $ 20,038,054



Operating expense:

Cost of revenue and product support 6,884,647 6,997,424

Sales and marketing 4,995,578 5,775,309

General and administrative 5,214,936 4,948,443

Depreciation and amortization 1,019,515 838,866

Total operating expense 18,114,676 18,560,042



Income from operations 2,892,400 1,478,012



Other income (expense):

Interest income 237,269 224,908

Interest expense (106,680 ) (67,732 )

Unrealized gain on short term investments 61,953 -

Gain on debt extinguishment 1,109,350 -



Income before income taxes 4,194,292 1,635,188



(Provision) for income taxes (76,897 ) (41,919 )



Net income 4,117,395 1,593,269



Dividends on Preferred Stock (586,444 ) (586,444 )



Net income applicable to common shareholders $ 3,530,951 $ 1,006,825



Weighted average shares, basic 19,502,000 19,651,000

Weighted average shares, diluted 19,754,000 19,863,000

Basic earnings per share $ 0.18 $ 0.05

Diluted earnings per share $ 0.18 $ 0.05

PARK CITY GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows

For the Years Ended June 30,

2021 2020

Cash flows from operating activities:

Net income $ 4,117,395 $ 1,593,269

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization 1,019,515 803,002

Amortization of operating right of use asset 85,766 81,604

Stock compensation expense 336,695 399,681

Bad debt expense 1,056,205 800,000

Gain on debt extinguishment (1,109,350 ) -

Decrease (increase) in:

Trade receivables (199,437 ) (205,718 )

Long-term receivables, prepaids and other 465,978 1,279,674 assets

Increase (decrease) in:

Accounts payable 59,697 (122,797 )

Accrued liabilities (254,601 ) (278,255 )

Operating lease liability (85,766 ) (81,605 )

Deferred revenue (90,282 ) (72,716 )



Net cash provided by operating activities 5,401,815 4,196,139



Cash flows from investing activities:

Purchase of property and equipment (147,140 ) (650,422 )

Capitalization of software development costs (171,733 ) -



Net cash used in investing activities (318,873 ) (650,422 )



Cash flows from financing activities:

Proceeds from employee stock purchase plans 117,487 120,923

Proceeds from issuance of note payable - 1,109,350

Net increase in lines of credit 1,340,000 -

Dividends paid (586,444 ) (586,444 )

Common stock buy-back (1,308,238 ) (2,158,471 )

Payments on notes payable and capital leases (920,755 ) (295,168 )



Net cash used in financing activities (1,357,950 ) (1,809,810 )



Net increase in cash and cash equivalents 3,724,992 1,735,907



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



Cash and cash equivalents at end of period $ 24,070,322 $ 20,345,330



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