CORRECTING and REPLACING Park City Group Reports EPS of $0.05 for Fiscal Fourth Quarter of 2022, $0.18 Per Share for Full Year

 Board of Directors Announces Quarterly Cash Dividend of $0.015 Per Share

SALT LAKE CITY–(BUSINESS WIRE)–The press release issued September 28, 2022 contained incorrect comparisons for the prior-year quarterly financial results. The rest of the financial results were correct as originally presented.

The updated release reads:

PARK CITY GROUP REPORTS EPS OF $0.05 FOR FISCAL FOURTH QUARTER OF 2022, $0.18 PER SHARE FOR FULL YEAR

Board of Directors Announces Quarterly Cash Dividend of $0.015 Per Share

Park City Group, Inc. (NASDAQ: PCYG), the parent company of ReposiTrak, Inc., which operates a B2B ecommerce, compliance, and supply chain platform that largely partners with grocery 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 quarter of fiscal 2022, the period ended June 30, 2022.

Full-Year Financial Highlights:

  • Recurring revenue increased 6% to $17.9 million.
  • Recurring SaaS revenue increased from 80% of total revenue to 99% of revenue.
  • Total revenue decreased to $18.0 million from $21.0 million, down 14% due to the planned elimination of essentially all non-recurring revenue.
  • Total operating expense decreased 25% to $13.6 million from $18.1 million.
  • Operating income increased 53% to $4.4 million from $2.9 million last year.
  • GAAP net income decreased 3% to $4.0 million vs. net income of $4.1 million (which included a $1.1 million gain on the forgiveness of the Company’s PPP loan last year)
  • Net income to common shareholders was $3.4 million, vs. $3.5 million, which included the $1.1 million non-operational gain last year.
  • Full year EPS of $0.18, unchanged from $0.18 last year.
  • Full-year cash from operations of $6.1 million.
  • The Company repurchased 983,275 shares at an average price of $6.24 for a total of $6.1 million during the year.
  • Cash at June 30, 2022 was $21.5 million.

Fourth Fiscal Quarter Financial Highlights:

  • Recurring revenue increased 7% to $4.6 million.
  • Total revenue of $4.6 million.
  • Total operating expense of $3.5 million vs. $3.4 million.
  • Operating income of $1.1 million vs. $1.2 million in the fourth fiscal quarter last year.
  • GAAP net income of $1.1 million vs. net income of $1.2 million.
  • Net income to common shareholders of $1 million .
  • EPS of $0.05, the same as the prior year fourth fiscal quarter.
  • The Company repurchased 192,747 shares at an average price of $4.78 per share for a total of $921,330.

Randall K. Fields, Chairman and CEO of Park City Group commented, “Park City continues to make progress in our focus on recurring revenue and our earnings per share growth – with the virtual elimination of non-recurring revenue, consistent GAAP net income, along with the repurchase and retirement of more than 192,700 shares in the quarter, meaningfully reducing our capitalization by over 8% since inception.”

“Park City maintains a fortress balance sheet, including more than $1.10 per share in cash, and has delivered consistent profitability, with over 20 consecutive GAAP profitable quarters, and continued strong cash generation. As a result, the Board of Directors has determined that the time is appropriate to return a portion of our future cash flow to shareholders, in the form of a quarterly cash dividend of $0.015 per share, to augment our stock buyback authorization and our investments for organic growth.”

“As the pandemic wanes, we are seeing demand for our SaaS solutions continues to grow, and we are preparing our company and our base of loyal customers to ultimately benefit from our traceability solution,” added Mr. Fields. “Our partnership with the National Grocers Association, a leading trade organization that covers one-third of all grocery stores and more independent owners than any other trade group, serves as a powerful validation of our capability to help retailers, wholesalers and suppliers navigate the profound challenges associated with the Food Safety Modernization Act’s Section 204, scheduled to be published in November 2022. Rule 204 will be the single largest change to the food supply chain collaboration in history. Park City Group is the proven partner, well-positioned to help the industry navigate these changes.”

Fourth Quarter Financial Results (three months ended June 30, 2022, vs. three months ended June 30, 2021):

Total revenue was $4.6 million as compared to $4.6 million due to eliminating MarketPlace non-recurring revenue and sunsetting recurring revenue for products and services in order to focus on traceability. Total operating expense of $3.5 million due to lower corresponding MarketPlace revenue and lower overall SG&A expense. GAAP net income was $1.1 million compared to $1.2 million. Net income to common shareholders $1 million, or $0.05 per diluted share, compared to $1 million, or $0.05 per diluted share.

Full-Year Financial Results (12 months ended June 30, 2022, vs. 12 months ended June 30, 2021):

Total revenue decreased 14% to $18.0 million as compared to $21.0 million due to the over $4 million planned elimination of all non-recurring revenue. Total operating expense decreased 25% to $13.6 million due to elimination of MarketPlace costs and lower overall SG&A. GAAP net income was $4.0 million versus $4.1 million. The prior-year period included a $1.1 million gain related to the forgiveness of the Company’s PPP loan. Absent the one-time gain, net income increased 33%. Net income to common shareholders was $3.4 million, or $0.18 per diluted share, compared to $3.5 million (inclusive of the $1.1 million non-recurring gain), or $0.18 per diluted share.

Share Repurchases:

In the fourth quarter, the Company repurchased 192,747 shares at an average price of $4.78 for a total of $0.92 million. During the fiscal year, Park City repurchased $6.2 million in stock and to date, the Company has repurchased a total of $10.2 million worth of stock, retiring an aggregate of 1.71 million shares. The Company has approximately $10.2 million remaining on the $21 million total buyback authorization since inception.

Balance Sheet:

The Company had $21.5 million in cash and cash equivalents at June 30, 2022, compared to $24.1 million at June 30, 2021. The Company had $2.6 million drawn on its working line of credit as of June 30, 2022. Funds were utilized to buy back additional shares of stock.

Dividend:

Park City’s Board of Directors declared a quarterly cash dividend of $0.015 per share ($0.06 per year), payable to shareholders of record on October 17 and to be paid on or about November 15. Based on the closing price on September 27, 2022, this represented an annual dividend yield of approximately 1.06%. Subsequent quarterly dividends will be paid within 45 days of the shareholders of record date of December 31, March 31, June 30 and September 30.

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: Wednesday, September 28, 2022

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: 13732847

Replay Dial-In Numbers:

Toll Free: 1-844-512-2921

Toll/International: 1-412-317-6671

Replay Start: Wednesday September 28, 2022, 7:15 p.m. ET

Replay Expiry: Friday, October 28, 2022, 11:59 p.m. ET

Replay Pin Number: 13732847

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, 2022 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,

2022

 

 

June 30,

2021

 

Assets

 

 

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

 

 

Cash

 

$

21,460,948

 

 

$

24,070,322

 

Receivables, net of allowance for doubtful accounts of $206,093 and $234,693 at June 30, 2022 and 2021, respectively

 

 

3,165,200

 

 

 

3,891,699

 

Contract asset – unbilled current portion

 

 

649,433

 

 

 

1,248,936

 

Prepaid expense and other current assets

 

 

1,307,128

 

 

 

490,817

 

Total Current Assets

 

 

26,582,709

 

 

 

29,701,774

 

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

764,517

 

 

 

2,589,194

 

 

 

 

 

 

 

 

 

 

Other Assets:

 

 

 

 

 

 

 

 

Deposits and other assets

 

 

22,414

 

 

 

22,414

 

Prepaid expense – less current portion

 

 

82,934

 

 

 

47,987

 

Contract asset – unbilled long-term portion

 

 

108,052

 

 

 

408,925

 

Operating lease – right-of-use asset

 

 

368,512

 

 

 

695,371

 

Customer relationships

 

 

394,200

 

 

 

525,600

 

Goodwill

 

 

20,883,886

 

 

 

20,883,886

 

Capitalized software costs, net

 

 

114,488

 

 

 

171,732

 

Total Other Assets

 

 

21,974,486

 

 

 

22,755,915

 

 

 

 

 

 

 

 

 

 

Total Assets

 

$

49,321,712

 

 

$

55,046,883

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders Equity

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

$

690,638

 

 

$

467,194

 

Accrued liabilities

 

 

1,206,284

 

 

 

988,092

 

Contract liability – deferred revenue

 

 

1,555,143

 

 

 

1,755,341

 

Lines of credit

 

 

2,590,907

 

 

 

6,000,000

 

Operating lease liability – current

 

 

53,862

 

 

 

90,156

 

Total current liabilities

 

 

6,096,834

 

 

 

9,300,783

 

 

 

 

 

 

 

 

 

 

Long-term liabilities

 

 

 

 

 

 

 

 

Operating lease liability – less current portion

 

 

321,818

 

 

 

605,214

 

Total liabilities

 

 

6,418,652

 

 

 

9,905,997

 

 

 

 

 

 

 

 

 

 

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 June 30, 2022 and 2021;

 

 

6,254

 

 

 

6,254

 

Series B-1 Preferred, 550,000 shares authorized; 212,402 shares issued and outstanding at June 30, 2022 and 2021, respectively

 

 

2,124

 

 

 

2,124

 

Common Stock, $0.01 par value, 50,000,000 shares authorized; 18,460,538 and 19,351,935 issued and outstanding at June 30, 2022 and 2021, respectively

 

 

184,608

 

 

 

193,522

 

Additional paid-in capital

 

 

68,653,361

 

 

 

74,298,924

 

Accumulated deficit

 

 

(25,943,287

)

 

 

(29,359,938

)

Total stockholders equity

 

 

42,903,060

 

 

 

45,140,886

 

Total liabilities and stockholders equity

 

$

49,321,712

 

 

$

55,046,883

 

 
 

PARK CITY GROUP, INC. AND SUBSIDIARIES

Consolidated Statements of Operations

 

 

For the Years Ended

June 30,

 

 

 

2022

 

 

2021

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

18,046,941

 

 

$

21,007,076

 

 

 

 

 

 

 

 

 

 

Operating expense:

 

 

 

 

 

 

 

 

Cost of revenue and product support

 

 

3,186,712

 

 

 

6,884,647

 

Sales and marketing

 

 

4,853,926

 

 

 

4,995,578

 

General and administrative

 

 

4,716,131

 

 

 

5,214,936

 

Depreciation and amortization

 

 

875,551

 

 

 

1,019,515

 

Total operating expense

 

 

13,632,320

 

 

 

18,114,676

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

4,414,621

 

 

 

2,892,400

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

Interest income

 

 

199,124

 

 

 

237,269

 

Interest expense

 

 

(44,307

)

 

 

(106,680

)

Realized loss on short term investments

 

 

(347,645

)

 

 

 

Unrealized gain on short term investments

 

 

 

 

 

61,953

 

Other gain (loss)

 

 

(88,730

)

 

 

1,109,350

 

Income before income taxes

 

 

4,133,063

 

 

 

4,194,292

 

 

 

 

 

 

 

 

 

 

(Provision) for income taxes

 

 

(129,968

)

 

 

(76,897

)

Net income

 

 

4,003,095

 

 

 

4,117,395

 

 

 

 

 

 

 

 

 

 

Dividends on Preferred Stock

 

 

(586,444

)

 

 

(586,444

)

 

 

 

 

 

 

 

 

 

Net income applicable to common shareholders

 

$

3,416,651

 

 

$

3,530,951

 

 

 

 

 

 

 

 

 

 

Weighted average shares, basic

 

 

19,087,000

 

 

 

19,502,000

 

Weighted average shares, diluted

 

 

19,380,000

 

 

 

19,754,000

 

Basic earnings per share

 

$

0.18

 

 

$

0.18

 

Diluted earnings per share

 

$

0.18

 

 

$

0.18

 

 
 

PARK CITY GROUP, INC. AND SUBSIDIARIES

Consolidated Statements of Cash Flows

 

 

For the Years Ended

June 30,

 

 

 

2022

 

 

2021

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net income

 

$

4,003,095

 

 

$

4,117,395

 

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

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

875,551

 

 

 

1,019,515

 

Amortization of operating right of use asset

 

 

326,858

 

 

 

85,766

 

Stock compensation expense

 

 

422,101

 

 

 

336,695

 

Bad debt expense

 

 

621,667

 

 

 

1,056,205

 

Gain on disposal of assets

 

 

(24,737

)

 

 

 

Gain on debt extinguishment

 

 

 

 

 

(1,109,350

)

Loss on sale of property and equipment

 

 

107,820

 

 

 

 

(Increase) decrease in:

 

 

 

 

 

 

 

 

Trade receivables

 

 

412,502

 

 

 

(199,437

)

Long-term receivables, prepaids and other assets

 

 

(527,126

)

 

 

465,978

 

(Decrease) (increase) in:

 

 

 

 

 

 

 

 

Accounts payable

 

 

223,444

 

 

 

59,697

 

Operating lease liability

 

 

(319,690

)

 

 

(85,766

)

Accrued liabilities

 

 

180,330

 

 

 

(254,601

)

Deferred revenue

 

 

(200,198

)

 

 

(90,282

)

Net cash provided by operating activities

 

 

6,101,617

 

 

 

5,401,815

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Sale of property and equipment

 

 

1,374,085

 

 

 

 

Purchase of property and equipment

 

 

(50,823

)

 

 

(147,140

)

Capitalization of software development costs

 

 

 

 

 

(171,733

)

Net cash used in investing activities

 

 

1,323,262

 

 

 

(318,873

)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Net (decrease) increase in lines of credit

 

 

(3,409,093

)

 

 

1,340,000

 

Common stock buy-back/retirement

 

 

(6,147,893

)

 

 

(1,308,238

)

Proceeds from employee stock plan

 

 

109,177

 

 

 

117,487

 

Dividends paid

 

 

(586,444

)

 

 

(586,444

)

Payments on notes payable and capital leases

 

 

 

 

 

(920,755

)

Net cash used in financing activities

 

 

(10,034,253

)

 

 

(1,357,950

)

 

 

 

 

 

 

 

 

 

Net (decrease) increase in cash and cash equivalents

 

 

(2,609,374

)

 

 

3,724,992

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

 

24,070,322

 

 

 

20,345,330

 

Cash and cash equivalents at end of period

 

$

21,460,948

 

 

$

24,070,322

 

 

 

 

 

 

 

 

 

 

Supplemental Disclosure of Cash Flow Information

 

 

 

 

 

 

 

 

Cash paid for income taxes

 

$

185,068

 

 

$

167,185

 

Cash paid for interest

 

$

45,777

 

 

$

103,411

 

Cash paid for operating leases

 

$

105,084

 

 

$

122,400

 

 

 

 

 

 

 

 

 

 

Supplemental Disclosure of Non-Cash Investing and Financing Activities

 

 

 

 

 

 

 

 

Common Stock to pay accrued liabilities

 

$

384,239

 

 

$

217,253

 

Dividends accrued on Preferred Stock

 

$

586,444

 

 

$

586,444

 

 

Contacts

Investor Relations:
John Merrill, CFO

Investor-relations@parkcitygroup.com

Or

FNK IR

Rob Fink

646.809.4048

rob@fnkir.com