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Park City Group Reports First Fiscal Quarter 2019 ResultsPark City Group, Inc. (NASDAQ:PCYG), the parent company of ReposiTrak, Inc., which operates a B2B e-commerce, compliance, and supply chain platform that partners with retailers, wholesalers, and their suppliers, to accelerate sales, control risk, and improve supply chain efficiencies, announced financial results for the first fiscal quarter ended September 30, 2018. First Fiscal Quarter Financial and Recent Business Highlights:
"We began fiscal 2019 with strong momentum and continued growth across all areas of our business," said Randall K. Fields, Chairman and Chief Executive Officer of Park City Group. "Total revenues increased 26% in the first quarter, and we delivered a near tripling of net income, and record operating cash flows. Results for the quarter were driven by our Compliance business, with growth of both Tier 1 and Tier 2 connections, continued growth in high quality Supply Chain subscription revenue, and a large year-over-year increase in revenues from our MarketPlace initiative." Mr. Fields added. "With the convergence of our Supply Chain offering into ReposiTrack and the launch of MarketPlace we have created a single platform to address our customers' needs across every aspect of the supply chain. This is allowing us to better cross-sell our solutions within our network which positions us to more effectively drive growth and accelerate profitability. As a result, we are winning larger mandates from our retail and wholesale HUBs for both our Compliance and Supply Chain solutions and driving sales of our applications deeper into their supplier bases, most notably with our Tier 2 Supplier HUB growth initiative." "With MarketPlace up and running, and revenues accelerating, we rotated our focus back to Compliance," Mr. Fields added. "As a result, we generated strong results from Compliance activities during the first quarter. We saw near record growth in Tier-1 Compliance connections, while our Success Team's increased focus on signing up Tier-2 Supplier Hubs accelerated the pace of this activity from prior quarters. This gives us even greater confidence that this offering will be a catalyst for growth beginning in the second half of this year as we leverage our relationship with the thousands of suppliers in our Compliance network." "Our Supply Chain business continues to deliver solid revenue growth," said Mr. Fields. "This is increasingly being driven by larger mandates from retail and wholesale HUBs seeking to drive our applications deeper into their supply chains as they see the benefit from our solutions to their competitive capabilities. However, overall results are also clearly underpinned by low churn of both Supply Chain and Compliance customers due to our relentless pursuit of customer satisfaction, with overall churn less than 2% of total revenues in the past year." "Last, but certainly not least, we continue to be encouraged by the results we are achieving from MarketPlace with one of the largest retailers in the country," concluded Mr. Fields. "During the first quarter, we expanded our program with this customer to a second category, improved our execution capabilities, and are working to onboard new retail HUB buyers to the platform. As expected, we experienced some seasonality during the first quarter, which will likely continue into our second quarter. Nevertheless, year-over-year growth remains significant and we remain confident we will add at least two more buyer HUBs to MarketPlace in fiscal 2019." Financial Results Summary: First Fiscal Quarter Results: Total revenue increased 26% to $5.9 million for the three months ended September 30, 2018, as compared to $4.7 million during the same period a year ago. Total operating expenses were $4.9 million, a 15% increase from $4.3 million a year ago, as the Company begins to leverage investments made in increasing productivity. GAAP net income was $996,000, or 16.3% of revenue, versus $331,000, or 7.0% of revenue, a year ago, and GAAP net income to common shareholders was $820,000, or $0.04 per diluted share, compared to $214,000, or $0.01 per diluted share, a year ago. Conference Call: The Company will host a conference call at 4:30 P.M. ET today, November 8, 2018 to discuss the Company's results. Investors and interested parties may participate in the call by dialing 877-830-2597 or 785-424-1744 (international) and referring Conference ID: PARKCITY. The conference call is also being webcast and is available via the investor relations section of the Company's website, www.parkcitygroup.com. A replay of the conference call will be available from 7:30 ET today until 11:59 p.m. ET on December 8, 2018. The Replay can be accessed by calling 844-512-2921 (toll-free) or 412-317-6671 (international). Please enter pin number 132193 to access the replay. 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 partners with 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 quarter ended September 30, 2018 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. -- Financial Tables Follow --
Non-GAAP Financial Measures While this press release does not include non-GAAP financial measures, the financial presentation below contains certain financial measures defined as "non-GAAP financial measures" by the Securities and Exchange Commission, including non-GAAP EBITDA and non-GAAP earnings per share. 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, 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, amortization of acquired intangible assets and other one-time cash and non-cash charges. 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. Because Park City Group has historically reported certain non-GAAP results to investors, the Company believes that the inclusion of non-GAAP measures in the financial presentation below allows investors to compare the Company's financial results with the Company's historical financial results reported using non-GAAP financial measures, as well as with the financial results reported by others. 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.
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