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TMCNet:  Park City Group Reports 7% Increase in Revenue, Net Income More than Doubles, Cash of $23.9 Million for Fiscal Second Quarter 2021

[February 16, 2021]

Park City Group Reports 7% Increase in Revenue, Net Income More than Doubles, Cash of $23.9 Million for Fiscal Second Quarter 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 second fiscal quarter ended December 31, 2020.

Second Quarter Financial and Recent Business Highlights:

  • Total revenue increased to $5.2 million from $4.8 million, a 7% year-over-year increase resulting from higher MarketPlace revenue and recurring SaaS revenue. Fiscal 2020 revenue included $410,000 of one-time revenue that did not reoccur in fiscal 2021.
  • GAAP net income of $1.6 million which includes a $72,000 unrealized gain on investment and a $1.1 million gain on forgiveness of debt vs. net income of $660,000 in the prior year.
  • Net income to common shareholders of $1.5 million, inclusive of above-mentioned gains, vs. $516,000.
  • EPS $0.08 vs. $0.03 in the prior year second quarter.

Randall K. Fields, Chairman and CEO of Park City Group commented, "We continue to experience increased interest and higher levels of buying and selling activity across MarketPlace beyond our traditional base of food retailers who utilize our concierge and automated platform to secure hard-to-source supplies. Importantly, we have reached sufficient scale and established pricing models that enable sustainable profitability. With this, we can leverage our profitable business model to generate steady bottom-line growth, even if transactional revenues for hard-to-source items fluctuate from quarter to quarter."

"In parallel, we are beginning to rollout two added offerings to our platform, which are expected to contribute to revenue as the year progresses," continued Mr. Fields. "The first, within our MarketPlace solution, is a grant reconciliation solution, helping states accurately manage their FEMA procurement efforts before, during and after emergencies. Park City has signed up a U.S. state to pilot this offering, and we anticipate incremental revenue from this solution in this year. Our second offering is a Quality Management Solution or QMS, which is an extension of our existing compliance offering. We have experienced a high level of interest from customers and expect more revenue contribution from this in the coming quarters."

Second Quarter Financial Results (three months ended December 31, 2020 vs. three months ended December 31, 2019):

Total revenue increased 7% to $5.2 million as compared to $4.8 million due largely to growth in MarketPlace revenue and a 7% increase in recurring revenue. Total operating expense increased 14% to $4.8 million due to increased cost of revenue and product support due to the revenue mix, reflecting a greater portion of MarketPlace. GAAP net income was $1.6 million, inclusive of unrealized gains on investment activities and the forgiveness of a of $1.1 million PPP loan, versus $663,000. GAAP net income to common shareholders was $1.5 million, inclusive of the aforementioned gains, or $0.08 per diluted share, compared to $516,000, or $0.03 per diluted share.

Fiscal 2020 Year to Date Results (six months ended December 31, 2020 vs. six months ended December 31, 2019):

Total revenue increased 8.3% to $10.4 million for the six months ended December 31, 2020, as compared to $9.6 million during the same period a year ago. Total operating expense was $9.4 million, an increase of 5.6% from $8.9 million a year ago. GAAP net income was $2.2 million versus $842,000 a year ago, and GAAP net income to common shareholders was $1.9 million, or $0.10 per diluted share, compared to $548,000, or $0.03 per diluted share, a year ago.

Balance Sheet:

The Company had $23.9 million in cash and cash equivalents at December 31, 2020, compared to $19.0 million at December 31, 2019 and $20.4 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: Tuesday, February 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: 13715993

Replay Dial-In Numbers:
TOLL-FREE 1-844-512-2921
TOLL/INTERNATIONAL 1-412-317-6671
From: 2/16/21 @ 7:15 P.M. Eastern Time
To: 3/16/21 @ 11:59 P.M. Eastern Time
Replay Pin Number: 13715993

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 Condensed Balance Sheets (Unaudited)

 

Assets

 

December 31,
2020

 

 

June 30,
2020

 

Current Assets

 

 

 

 

 

 

Cash

 

$

23,894,653

 

 

$

20,345,330

 

Receivables, net of allowance for doubtful accounts of $338,684 and $251,954 at December 31, 2020 and June 30, 2020, respectively

 

 

3,043,727

 

 

 

4,007,316

 

Contract asset - unbilled current portion

 

 

2,122,958

 

 

 

2,300,754

 

Prepaid expense and other current assets

 

 

539,454

 

 

 

495,511

 

 

 

 

 

 

 

 

 

 

Total Current Assets

 

 

29,600,792

 

 

 

27,148,911

 

 

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

2,817,608

 

 

 

3,003,402

 

 

 

 

 

 

 

 

 

 

Other Assets:

 

 

 

 

 

 

 

 

Deposits, and other assets

 

 

22,414

 

 

 

22,414

 

Prepaid expense - less current portion

 

 

49,819

 

 

 

77,030

 

Contract asset - unbilled long-term portion

 

 

310,656

 

 

 

838,726

 

Operating lease - right-of-use asset

 

 

738,941

 

 

 

781,137

 

Customer relationships

 

 

591,300

 

 

 

657,000

 

Goodwill

 

 

20,883,886

 

 

 

20,883,886

 

Capitalized software costs, net

 

 

-

 

 

 

18,539

 

 

 

 

 

 

 

 

 

 

Total Other Assets

 

 

22,597,016

 

 

 

23,278,732

 

 

 

 

 

 

 

 

 

 

Total Assets

 

$

55,015,416

 

 

$

53,431,045

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

$

539,151

 

 

$

407,497

 

Accrued liabilities

 

 

1,741,087

 

 

 

1,123,528

 

Contract liability - deferred revenue

 

 

1,608,480

 

 

 

1,845,347

 

Lines of credit

 

 

5,720,175

 

 

 

4,660,000

 

Operating lease liability - current

 

 

87,952

 

 

 

85,767

 

Current portion of notes payable

 

 

-

 

 

 

310,242

 

Current portion of paycheck protection program loans

 

 

-

 

 

 

479,866

 

 

 

 

 

 

 

 

 

 

Total current liabilities

 

 

9,696,845

 

 

 

8,912,247

 

 

 

 

 

 

 

 

 

 

Long-term liabilities

 

 

 

 

 

 

 

 

Operating lease liability - less current portion

 

 

650,988

 

 

 

695,369

 

Notes payable - less current portion

 

 

-

 

 

 

610,512

 

Paycheck protection program loans

 

 

10,000

 

 

 

629,484

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

10,357,833

 

 

 

10,847,612

 

 

 

 

 

 

 

 

 

 

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 December 31, 2020 and June 30, 2020, respectively

 

 

6,254

 

 

 

6,254

 

Series B-1 Preferred, 550,000 shares authorized; 212,402 shares issued and outstanding at December 31, 2020 and June 30, 2020, respectively

 

 

2,124

 

 

 

2,124

 

Common Stock, $0.01 par value, 50,000,000 shares authorized; 19,529,422 and 19,484,485 issued and outstanding at December 31, 2020 and June 30, 2020, respectively

 

 

195,297

 

 

 

194,847

 

Additional paid-in capital

 

 

75,460,334

 

 

 

75,271,097

 

Accumulated deficit

 

 

(31,006,426

)

 

 

(32,890,889

)

 

 

 

 

 

 

 

 

 

Total stockholders' equity

 

 

44,657,583

 

 

 

42,583,433

 

 

 

 

 

 

 

 

 

 

Total liabilities and stockholders' equity

 

$

55,015,416

 

 

$

53,431,045

 

PARK CITY GROUP, INC.

Consolidated Condensed Statements of Operations (Unaudited)

 

 

 

Three Months Ended
December 31,

 

 

Six Months Ended
December 31,

 

 

 

2020

 

 

2019

 

 

2020

 

 

2019

 

 

 

 

 

 

 

 

Revenue

 

$

5,174,204

 

 

$

4,837,332

 

 

$

10,399,606

 

 

$

9,637,416

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of services and product support

 

 

2,091,588

 

 

 

1,425,309

 

 

 

4,072,545

 

 

 

3,253,423

 

Sales and marketing

 

 

1,205,295

 

 

 

1,446,517

 

 

 

2,488,336

 

 

 

2,861,380

 

General and administrative

 

 

1,231,139

 

 

 

1,114,251

 

 

 

2,313,064

 

 

 

2,336,462

 

Depreciation and amortization

 

 

261,597

 

 

 

222,499

 

 

 

510,097

 

 

 

416,177

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total operating expense

 

 

4,789,619

 

 

 

4,208,576

 

 

 

9,384,042

 

 

 

8,867,442

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

 

 

384,585

 

 

 

628,756

 

 

 

1,015,564

 

 

 

769,974

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

81,503

 

 

 

65,982

 

 

 

115,844

 

 

 

148,713

 

Interest expense

 

 

(1,907

)

 

 

(16,042

)

 

 

(72,452

)

 

 

(36,640

)

Unrealized gain (loss) on short term investments

 

 

71,828

 

 

 

-

 

 

 

55,565

 

 

 

-

 

Gain on debt extinguishment

 

 

1,099,350

 

 

 

-

 

 

 

1,099,350

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

1,635,359

 

 

 

678,696

 

 

 

2,213,871

 

 

 

882,047

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Provision) for income taxes:

 

 

(12,500

)

 

 

(15,593

)

 

 

(36,186

)

 

 

(40,593

)

Net income

 

 

1,622,859

 

 

 

663,103

 

 

 

2,177,685

 

 

 

841,454

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends on preferred stock

 

 

(146,611

)

 

 

(146,611

)

 

 

(293,222

)

 

 

(293,222

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income applicable to common shareholders

 

$

1,476,248

 

 

$

516,492

 

 

$

1,884,463

 

 

$

548,232

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares, basic

 

 

19,526,000

 

 

 

19,741,000

 

 

 

19,508,000

 

 

 

19,775,000

 

Weighted average shares, diluted

 

 

19,716,000

 

 

 

20,052,000

 

 

 

19,653,000

 

 

 

20,033,000

 

Basic income per share

 

$

0.08

 

 

$

0.03

 

 

$

0.10

 

 

$

0.03

 

Diluted income per share

 

$

0.08

 

 

$

0.03

 

 

$

0.10

 

 

$

0.03

 

PARK CITY GROUP, INC.

Consolidated Condensed Statements of Cash Flows (Unaudited)

 

 

 

Six Months
Ended December 31,

 

 

 

2020

 

 

2019

 

Cash flows operating activities:

 

 

 

 

 

 

Net income

 

$

2,177,685

 

 

$

841,454

 

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

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

510,097

 

 

 

416,177

 

Amortization of operating right of use asset

 

 

42,196

 

 

 

40,239

 

Stock compensation expense

 

 

166,923

 

 

 

244,505

 

Bad debt expense

 

 

310,000

 

 

 

250,000

 

Gain on debt extinguishment

 

 

(1,099,350

)

 

 

-

 

(Increase) decrease in:

 

 

 

 

 

 

 

 

Accounts receivables

 

 

520,719

 

 

 

(231,438

)

Long-term receivables, prepaids and other assets

 

 

685,158

 

 

 

665,474

 

(Decrease) increase in:

 

 

 

 

 

 

 

 

Accounts payable

 

 

131,654

 

 

 

225,970

 

Operating lease liability

 

 

(42,196

)

 

 

(40,239

)

Accrued liabilities

 

 

590,271

 

 

 

(284,418

)

Deferred revenue

 

 

(237,143

)

 

 

543,861

 

Net cash provided by operating activities

 

 

3,756,014

 

 

 

2,671,585

 

 

 

 

 

 

 

 

 

 

Cash flows investing activities:

 

 

 

 

 

 

 

 

Purchase of property and equipment

 

 

(103,218

)

 

 

(581,750

)

Net cash used in investing activities

 

 

(103,218

)

 

 

(581,750

)

 

 

 

 

 

 

 

 

 

Cash flows financing activities:

 

 

 

 

 

 

 

 

Net increase in lines of credit

 

 

1,060,175

 

 

 

-

 

Common Stock buyback/retirement

 

 

-

 

 

 

(1,355,037

)

Proceeds from employee stock plan

 

 

50,328

 

 

 

63,523

 

Dividends paid

 

 

(293,222

)

 

 

(293,222

)

Payments on notes payable and capital leases

 

 

(920,754

)

 

 

(145,747

)

Net cash used in financing activities

 

 

(103,473

)

 

 

(1,730,483

)

 

 

 

 

 

 

 

 

 

Net increase in cash and cash equivalents

 

 

3,549,323

 

 

 

359,352

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

 

20,345,330

 

 

 

18,609,423

 

Cash and cash equivalents at end of period

 

$

23,894,653

 

 

$

18,968,775

 

 


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