Park City Group Reports Third Quarter Financial Results
Quarterly Results Exceed Guidance
May 26, 2009 8:31:00 AM
Copyright Business Wire 2009
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View Additional ProfilesPARK CITY, Utah--(BUSINESS WIRE)-- Park City Group, Inc. (OTCBB: PCYG), a developer of patented, innovative retail supply chain solutions and services, today announced its financial results for the three months ended March 31, 2009. The operating results include the combined results of both Park City Group and Prescient Applied Intelligence, Inc. as a result of the completion of the merger of Prescient and Park City Group on January 13, 2009.
Third Quarter Highlights:
-- Revenue increased 118% to $2.503 million, from $1.149 million in the
comparable quarter in 2008;
-- Adjusted earnings before interest, taxes, depreciation and amortization
increased 150% to $213,000 compared to $(422,000) in 2008;
-- Integration of Prescient and Park City Group is successfully completed;
and
-- Collaborative sales and marketing efforts are yielding positive and
tangible early results
The Company reported total revenue of $2,503,115 for the fiscal quarter ended March 31, 2009, compared with $1,149,521 for the fiscal quarter ended March 31, 2008. Total revenue in the comparable quarter in 2008 included a $700,000 license sale that did not occur in the quarter ended March 31, 2009. Operating expenses for the fiscal quarter ended March 31, 2009 were $4,081,883 compared with $1,743,424 for the quarter ended March 31, 2008. Operating expenses in the most recent quarter include a $1,457,383 non-cash charge related to impairment of capitalized software acquired in connection with acquisition of Prescient, as well as approximately $75,800 in non-recurring costs incurred in connection with the consummation of the merger. Operating expenses are anticipated to substantially decline as a percentage of revenue as a result of cost reduction measures initiated during the quarter.
Adjusted for the non-recurring costs and charges incurred in connection with consummation of merger, including the impairment charge to capitalized software, consolidated earnings before interest, taxes, depreciation and amortization ("EBITDA"), increased approximately 150% to $213,000 in the quarter ended March 31, 2009 compared with consolidated EBITDA of $(422,000) in 2008. Including the impairment charge to capitalized software, and interest, taxes, depreciation and amortization, net loss for the quarter ended March 31, 2009 was $2,035,944, or $(0.21) per common share, compared with a net loss of $289,610 in the quarter ended March 31, 2008, or $(0.03) per common share.
"The combined results from Park City and Prescient reported in the recently completed quarter are solid indicators that the anticipated benefits resulting from the consummation of the merger have been achieved. The financial results actually exceeded our guidance provided in our last quarterly conference call, and are a positive reflection of our ability to successfully integrate the operations," said Randall K. Fields, Park City Group's Chairman and CEO. "The early results from our collaborative sales and marketing efforts, together with the operational efficiencies gained during the quarter, position the combined company to further increase sales and realize our objective of achieving profitability."
EBITDA is calculated as net income before deducting interest, taxes, depreciation and amortization. Although EBITDA is not a measure of actual cash flow because it does not consider changes in assets and liabilities that may impact cash balances, the Company's management reviews these non-GAAP financial measures internally to evaluate the Company's performance and manage the operations. Additionally, the Company believes it is a useful metric to evaluate operating performance and has therefore included such measures in the reporting of operating results.
Conference Call
The Company will host a conference call Tuesday, May 26, 2009 at 4:30 P.M. EDT to discuss third quarter 2009 financial results.
Shareholders and other interested parties may participate in the conference call by dialing 877-407-9205 or (International) 201-689-8054 a few minutes before 4:30 P.M. EDT on the 26th. The call is being webcast by Vcall and can be accessed at www.InvestorCalendar.com.
The webcast will be available for replay through August 25th, 2009. A replay of the conference call will be accessible until June 25th, 2009 by dialing 877-660-6853 and entering the Account # 286 and the Conference ID # 323866.
About Park City Group
Park City Group is a trusted business solutions and services provider that enables retailers and suppliers to work collaboratively as strategic partners to reduce out-of-stocks, shrink, inventory and labor while improving profits, efficiencies and customer service. Our innovative solutions provide trading partners a common platform on which they can capture, manage, analyze and share critical data, bringing greater visibility throughout the supply chain, and giving them the power to make better and more informed decisions. For more information, go to www.parkcitygroup.com.
Park City Group recently acquired Prescient Applied Intelligence, click here to read more.
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-KSB for the fiscal year ended June 30, 2008, its quarterly report on Form 10-Q for the quarter ended March 31, 2009, 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 Statements of Operations (Unaudited)
For the Three and Nine Months Ended March 31, 2009 and 2008
Three Months Ended Nine Months Ended
March 31, 2009 March 31, 2009
Park City
Group, Inc. &
Subs
(Unaudited)
Revenues:
Subscriptions $ 1,372,127 $ 36,750 $ 1,509,397 $ 156,694
Maintenance 676,176 378,470 1,264,494 1,138,978
Professional 281,114 26,366 492,066 231,606
services
License fees 173,698 707,935 221,498 971,004
Total 2,503,115 1,149,521 3,487,455 2,498,282
revenues
Operating
expenses:
Cost of
services and 1,293,332 618,380 2,329,098 1,779,530
product
support
Sales and 445,677 467,284 978,681 1,469,130
marketing
General and 646,994 522,312 1,570,836 1,726,381
administrative
Impairment of
intangible 1,457,383 - 1,457,383 -
assets
Depreciation
and 238,497 135,448 511,738 369,991
amortization
Total
operating 4,081,883 1,743,424 6,847,736 5,345,032
expenses
Income (Loss)
from (1,578,768 ) (593,903 ) (3,360,281 ) (2,846,750 )
operations
Other income
(expense):
Income from
patent - 400,000 - 600,000
activities
Loss on equity
method - - (162,796 ) -
investment
Loss on
disposal of (295 ) 100 (295 )
assets
Interest
(expense) (257,068 ) 2,876 (337,001 ) 39,930
income
Loss before (1,835,836 ) (191,322 ) (3,859,978 ) (2,207,115 )
income taxes
(Provision)
benefit for - - - -
income taxes
Net (loss) $ (1,835,836 ) $ (191,322 ) $ (3,859,978 ) $ (2,207,115 )
income
Dividends on
preferred $ (200,108 ) $ (98,288 ) $ (528,182 ) $ (255,414 )
stock
Net loss
applicable to (2,035,944 ) $ (289,610 ) $ (4,388,160 ) $ (2,462,529 )
common
shareholders
Weighted
average 9,872,000 9,209,000 9,534,000 9,128,000
shares, basic
Basic (loss)
income per $ (0.21 ) $ (0.03 ) $ (0.46 ) $ (0.27 )
share
Three Months Ended Nine Months Ended
(In 000's) March 31, March 31,
Unaudited
Statement of FY 2009 FY 2008 FY 2009 FY 2008
Operations
Net loss
applicable to $ (2,036 ) $ (290 ) $ (4,388 ) $ (2,463 )
common
shareholders
Non-GAAP
Adjustments:
Impairment of
capitalized $ 1,457 $ - $ $ 1,457 $ -
software
Impairment of - - - -
goodwill
Depreciation
and 238 135 512 370
amortization
Bad debt - 18 81 75
expense
Stock issued
for services 20 18 76 75
and expenses
Income from
patent - (400 ) - (600 )
activities
Gain (loss) on
equity method - - 163 -
investment
Interest
income 257 (3 ) 337 (40 )
(expense)
Dividends on
preferred 200 98 528 255
stock
(b)
Acquisition 76 - 210 -
related costs
Adjusted
Non-GAAP $ 213 $ (422 ) $ (1,024 ) $ (2,327 )
EBITDA
Three Months Ended Nine Months Ended
(In 000's) March 31, March 31,
Unaudited
pro-forma
combined FY 2009 FY 2008 FY 2009 FY 2008
condensed
Statement of
Operations
Net loss
applicable to $ (2,036 ) $ (535 ) $ (6,916 ) $ (3,588 )
common
shareholders
Non-GAAP
Adjustments:
Impairment of
capitalized $ 1,457 $ - $ 1,457 $ -
software
Impairment of - - 2,370 -
goodwill
Depreciation
and 238 135 755 728
amortization
Bad debt - 18 102 90
expense
Stock issued
for services 20 18 71 142
and expenses
Income from
patent - (400 ) - 600
activities
Interest
income 257 (3 ) 415 (130 )
(expense)
Provision for - - 23 38
income taxes
Dividends on
preferred 200 98 1,537 1,961
stock
(b)
Acquisition 76 - 210 -
related costs
(a) Adjusted
Pro Forma $ 213 $ (668 ) $ 24 $ (160 )
EBITDA
(a) The unaudited pro-forma results of operations for the three and nine months ended
March 31, 2009 and 2008 include the operating results of Prescient, and assumes
Prescient had been acquired as of July 1, 2007.
(b) Acquisition related costs are certain costs that were incurred during the period
that were not capitalized. These costs include travel costs, rents incurred on vacant
corporate facilities, training and costs to rebrand the combined Company.
Source: Park City Group, Inc.
----------------------------------------------
PR Contact:
Park City Group
Courtney Behrens
610-719-1600 x332
cbehrens@prescient.com
or
IR Contact:
Bibicoff & MacInnis
Inc.
Terri MacInnis
818-379-8500
terri@bibimac.com
