Revenue Performance - Revenue for the three months ended December 31, 2020, was $5,174,204, representing a 7% increase from $4,837,332 in the same period of 2019, primarily driven by growth in MarketPlace and software subscription revenue[82] - Revenue for the six months ended December 31, 2020, was $10,399,606, an 8% increase from $9,637,416 in 2019, driven by growth in subscription and Marketplace revenue[94] Cost and Expenses - Cost of services and product support increased by 47% to $2,091,588 for the three months ended December 31, 2020, compared to $1,425,309 in 2019, mainly due to higher expenses associated with MarketPlace[85] - Cost of services and product support for the six months ended December 31, 2020, was $4,072,545, a 25% increase from $3,253,423 in 2019, mainly due to higher MarketPlace expenses and increased hardware/software costs[95] - Sales and marketing expenses decreased by 17% to $1,205,295 for the three months ended December 31, 2020, down from $1,446,517 in 2019, attributed to reduced contractor fees and travel expenses due to COVID-19[87] - Sales and marketing expense decreased by 13% to $2,488,336 for the six months ended December 31, 2020, compared to $2,861,380 in 2019[96] - General and administrative expenses rose by 10% to $1,231,139 for the three months ended December 31, 2020, compared to $1,114,251 in 2019, primarily due to increased bad debt expense and legal fees[89] - General and administrative expense slightly decreased by 1% to $2,313,064 for the six months ended December 31, 2020, from $2,336,462 in 2019[97] - Depreciation and amortization expense increased by 23% to $510,097 for the six months ended December 31, 2020, compared to $416,177 in 2019[98] Other Income - Net other income for the three months ended December 31, 2020, was $1,250,774, a significant increase of 2,405% from $49,940 in the same period of 2019, due to a gain on debt extinguishment and higher interest income[92] - Net other income surged by 969% to $1,198,307 for the six months ended December 31, 2020, from $112,073 in 2019[99] Cash Flow and Working Capital - Cash and cash equivalents increased by 17% to $23,894,653 as of December 31, 2020, compared to $20,345,330 as of June 30, 2020[102] - Net cash provided by operating activities rose by 41% to $3,756,014 for the six months ended December 31, 2020, from $2,671,585 in 2019[104] - Cash used in investing activities decreased by 82% to $103,218 for the six months ended December 31, 2020, compared to $581,750 in 2019[105] - Cash used in financing activities significantly decreased by 94% to $103,473 for the six months ended December 31, 2020, from $1,730,483 in 2019[107] - Working capital increased by $1,667,283 to $19,903,947 as of December 31, 2020, compared to $18,236,664 at June 30, 2020[108] - Current assets rose by 9% to $29,600,792 as of December 31, 2020, from $27,148,911 as of June 30, 2020[109] Strategic Initiatives - The company launched a pilot program in December 2020 to address emergency grant management requests, aimed at improving tracking and compliance for federal disaster grants[78] - The FoodSourceUSA platform was introduced in July 2020 to address food supply chain imbalances caused by COVID-19, facilitating the redistribution of excess perishable food products[80] - Management anticipates a continued focus on recurring subscription revenue while reducing reliance on non-recurring transactional revenue[83] Debt and Interest - As of December 31, 2020, the total debt was $5,720,175, consisting of 0% fixed rate debt and 100% variable rate debt[126] - The weighted average interest rate for cash holdings was 2.14%, with a fair value of $23,894,653 as of December 31, 2020[127] Accounting Standards - The company adopted Accounting Standards Update No. 2016-02, "Leases (Topic 842)" effective July 1, 2019, with updated disclosures for reporting periods beginning after this date[122]

Park City Group, Inc. (PCYG) Q1 2021 Earnings Conference Call November 16, 2020 4:15 PM ET Company Participants Rob Fink - IR, FNK IR John Merrill - Chief Financial Officer Randy Fields - Chairman & Chief Executive Officer Conference Call Participants Thomas Forte - D.A. Davidson Operator Greetings and welcome to the Park City Group's Fiscal First Quarter 2021 Earnings Call. At this time, all participants are in a listen-only mode. Our question-and-answer session will follow the formal presentation. [Operat ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended September 30, 2020 ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from __________ to _________. Commission File Number 001-34941 PARK CITY GROUP, INC. (Exact name of small business issuer as specified in its charter) (State or other jurisd ...

Financial Data and Key Metrics Changes - Annual recurring revenue for the software business grew by 13%, with 98% of the software business now being recurring revenue, up from 77% in 2019 and 69% in 2018 [6][10] - Total topline revenue for fiscal 2020 was $20 million, down 5% from $21 million in 2019, primarily due to a planned reduction in one-time software revenue [23] - GAAP net income for fiscal 2020 was $1.6 million, or 8% of revenue, compared to $3.3 million, or 16% of revenue in the previous year [29] Business Line Data and Key Metrics Changes - Marketplace revenue grew by 62%, with a significant increase of 177% in the fourth quarter to $1.3 million [6][17] - Operating expenses increased by 8% year-over-year, from $17.2 million in 2019 to $18.6 million in 2020, largely due to increased costs associated with marketplace revenue [24][25] Market Data and Key Metrics Changes - The number of Tier 2 customers increased by 75%, from 60 in 2019 to 105 in 2020 [6][46] - Marketplace has benefited from the demand for hard-to-find goods during the pandemic, contributing to significant transactional revenue [17][42] Company Strategy and Development Direction - The company is focused on transitioning from one-time software revenue to recurring revenue, which is expected to enhance predictability and profitability [33][36] - The strategy includes reducing operating expenses, generating cash, and strengthening the balance sheet while continuing to grow the network [18][39] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by COVID-19 but remains optimistic about the long-term growth potential, particularly in the grocery supply chain sector [40][53] - The company expects recurring revenue to grow at a low double-digit rate in fiscal 2021, despite the ongoing economic uncertainty [53][76] Other Important Information - The company has a strong balance sheet with total cash at the end of fiscal 2020 amounting to $20.4 million, up from $18.6 million in the previous year [30] - The stock buyback program was halted during the pandemic, with approximately 1.36 million remaining on the existing buyback program [31][32] Q&A Session Summary Question: What factors will drive non-recurring revenue in the next 12 months? - Management indicated uncertainty regarding non-recurring revenue but emphasized the growth of the recurring software SaaS business and the marketplace's potential [56][57] Question: How has COVID-19 impacted operating expenses? - Management stated that COVID-19 has not significantly affected expenses beyond the cost-cutting measures already implemented, with a projected reduction of about $1.2 million over the next year [61][62] Question: When will the revenue headwind from transactional revenue subside? - Management expects that by the next quarter, the company will be close to pure recurring revenue, leading to overall revenue growth [69] Question: Is recurring revenue tracking higher than initially expected? - Management confirmed that recurring revenue growth is tracking higher than previously anticipated, driven by successful cross-selling initiatives [71][74] Question: What are the strategic priorities moving forward? - The company will continue to focus on adding Tier 1 and Tier 2 hubs and enhancing cross-selling efforts within existing customer relationships [79]

Company Overview - Park City Group is a Software-as-a-Service (SaaS) provider focused on B2B e-commerce, compliance, and supply chain management, primarily serving the food retail sector[18]. - The company operates a hub and spoke business model, engaging retailers and wholesalers as "Hubs" that require their suppliers, or "Spokes," to utilize its services[22]. Product and Service Offerings - The company’s solutions include ReposiTrak MarketPlace, Compliance and Food Safety, and Supply Chain solutions, which enhance supplier discovery, compliance management, and supply chain efficiency[19][20]. - The company’s Compliance and Food Safety solutions include applications for Vendor Validation, Compliance Management, and Quality Management Systems, ensuring supplier compliance with food safety regulations[38]. - The company’s cloud-based solutions are designed to help customers manage inventory, reduce costs, and improve sales through enhanced visibility and forecasting[38]. Financial Performance - Target Corporation accounted for approximately 8.1% of the company's total revenue in the fiscal year ended June 30, 2020[42]. - The company received a loan of approximately $1.1 million under the Paycheck Protection Program (PPP) to support payroll costs and other expenses during the COVID-19 pandemic[28]. Strategic Initiatives - The company launched FoodSourceUSA in April 2020 to address food supply chain imbalances caused by COVID-19, facilitating the redistribution of excess perishable food[25][26]. - The company has streamlined its sales force to enable cross-selling and shifted emphasis towards its inside sales team located in Murray, Utah[46]. - The company’s product development strategy focuses on creating common technology elements for multiple applications across core markets, enhancing competitiveness[40]. Intellectual Property - The Company has been awarded nine U.S. patents and has a policy to seek patent protection for all patentable developments[50]. - The Company is not aware of any patent infringement claims against it, but potential litigation could incur significant costs and affect operations[51]. Workforce and Operations - As of June 30, 2020, the Company employed a total of 81 employees, with plans to expand its offshore workforce to enhance analytics services and programming resources[52]. Regulatory Compliance - The Company currently has no costs associated with compliance with environmental regulations and does not anticipate future costs[56]. - The Company does not engage in hedging transactions for currency exchange rate exposure, as all contracts require payment in U.S. dollars[167].

Financial Data and Key Metrics Changes - Total revenue for Q3 2020 was $4.63 million, down 7% from $5 million in Q3 2019 [18] - Recurring revenue grew 5% to $4.2 million for Q3 2020, up from $4 million in the same quarter of 2019, increasing its percentage of total revenue from 80% to 90% [18] - Year-to-date total revenue decreased from $16.5 million to $14.3 million, down 14% from the same period in fiscal 2019 [19] - Net income for Q3 2020 was $125,000, or $0.01 per diluted share, compared to $921,000, or $0.05 per diluted share in the year-ago quarter [23] - Total cash as of March 31, 2020, was $17.9 million, down $5.3 million sequentially from $19 million at December 31, 2019 [16] Business Line Data and Key Metrics Changes - Marketplace revenue was up 66% in Q3 2020, primarily due to increased demand for hard-to-find items related to the pandemic [14] - Total operating expenses for Q3 2020 were $4.4 million, an increase of 10% from $4 million in Q3 2019, largely due to higher marketplace costs and increased telecommuting expenses [21] - Deferred revenue decreased by 11% or $213,000 due to delays in implementations and completed contracts [17] Market Data and Key Metrics Changes - The grocery industry faced unique challenges during the pandemic, with supply chain disruptions leading to out-of-stock situations for essential items [29] - The pandemic has highlighted the importance of food safety and compliance, with the company positioned as essential to the grocery supply chain [32] Company Strategy and Development Direction - The company is focused on prioritizing recurring revenue over non-recurring revenue, which has been a consistent strategy [8] - Efforts to strengthen the balance sheet are critical as the company navigates the uncertainties of the pandemic [9] - The company aims to grow its network, although this effort was deprioritized during the pandemic [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future opportunities as customers stabilize their supply chains post-pandemic [10] - The company anticipates that the grocery industry will become more selective in partnerships, emphasizing the need for financial stability [11] - Management believes that the pandemic has reinforced the company's essential role in the grocery supply chain [36] Other Important Information - The company launched the FoodSourceUSA program to assist the Department of Defense in addressing food supply chain imbalances caused by COVID-19 [13] - The stock buyback program was halted on March 17, 2020, due to the pandemic [16][26] Q&A Session Summary Question: Can you clarify the revenue growth this quarter? - Management indicated that recurring revenue is growing, with marketplace revenue also seeing substantial increases, especially in the last few weeks of March [43] Question: What does the outlook for the June quarter look like? - Management expressed confidence in achieving year-over-year revenue growth in the June quarter, driven by recurring revenue and incremental marketplace growth [45][48] Question: How has licensing and services been impacted? - Management noted that the environment has made it easier to convert licensing revenue into recurring revenue as customers conserve cash [50] Question: What opportunities exist for scan-based trading? - Management sees potential for reshaping retailer-supplier relationships post-pandemic, with increased interest in scan-based trading initiatives [54] Question: How is the company positioned regarding online grocery? - Management acknowledged that while online grocery has seen growth, there are significant challenges in inventory accuracy that the company can help address [79] Question: What is the current M&A strategy? - Management is open to M&A opportunities, especially given the financial pressures many companies are facing, but is currently focused on execution [81]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended March 31, 2020 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from __________ to _________. Commission File Number 001-34941 PARK CITY GROUP, INC. (Exact name of small business issuer as specified in its charter) Nevada 37-1454128 (State ...

Financial Data and Key Metrics Changes - Total revenue for Q2 of fiscal 2020 was $4.84 million, down 13% from $5.56 million in the same quarter in 2019, largely due to a decrease in one-time revenue [15] - Recurring revenue for Q2 of 2020 grew 3% to $4.04 million, up from $3.89 million in the same quarter of fiscal 2019, with recurring revenue as a percentage of total revenue increasing to 83% [16] - Year-to-date total revenue decreased from $11.51 million to $9.64 million, down 16% from the same period of fiscal 2019, attributed to a decline in one-time revenue [17] - Net income for Q2 of fiscal 2020 was $517,000, or $0.03 per diluted share, compared to $1.5 million or $0.08 per diluted share in the prior year [21] - Total cash as of December 31, 2019, reached $19 million, with $2.7 million generated in cash from operations for the first six months of fiscal 2020, a 46% increase from the prior year [14][18] Business Line Data and Key Metrics Changes - The company added 42 new Tier 2 hubs since June 30, 2019, bringing the total to 90 as of December 31, 2019, an increase of 88% [10] - The supplier network grew from 23,000 unique participants to over 27,000, a 16% increase, largely driven by the addition of Tier 2 hubs [12] - The marketplace grew 13% year-over-year, although it remains largely transactional and difficult to predict [13] Market Data and Key Metrics Changes - The company anticipates a significant increase in the number of customers, projecting nearly 12,000 new customers this year, which would represent a 50% increase from the beginning of the year [41] - The exit rate for monthly recurring revenue increased to 8% by the end of December, doubling the rate from the previous quarter [42] Company Strategy and Development Direction - The company aims to grow recurring revenue and reduce reliance on one-time revenue, with a focus on maintaining flat annual operating expenses and increasing profitability [8] - The strategy includes expanding the network, cross-selling, and upselling within the supply chain offering [9] - The company is focused on further penetrating its current customer base and enhancing its sales force to support growth initiatives [33][79] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the transition to a recurring revenue model, indicating that revenue declines from this transition are transient and already abating [28] - The company expects to achieve double-digit growth in recurring revenue by the end of fiscal 2020, with a strong line of sight for future growth [30][74] - Management highlighted the importance of maintaining a strong balance sheet and generating cash, which is critical for customer confidence [32] Other Important Information - The company has repurchased a total of 342,170 shares of common stock at an average price of $5.37 per share under its stock buyback program [24] - The Out-of-Stock management solution has been endorsed by the Food Marketing Institute, which is expected to enhance the company's market position [46] Q&A Session Summary Question: Impact of global events on Park City Group - Management noted that the coronavirus has heightened awareness of food safety issues, which could benefit the company's business model [60] - There has been increased interest in the marketplace for sourcing products that are not stuck in ports due to supply chain disruptions [61] Question: Structure of the sales force - The company has two different sales organizations, one focused on compliance and the other on supply chain, both of which have been expanded recently [62] Question: Return to revenue growth - Management expressed optimism about achieving positive revenue growth before the end of the fiscal year, with expectations for double-digit growth in the following year [70][71] Question: Key initiatives for the year - The focus remains on the Tier 2 initiative, growing the network, and enhancing customer service, with expectations for significant growth in the number of participants [78]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended December 31, 2019 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from __________ to _________. Commission File Number 001-34941 PARK CITY GROUP, INC. (Exact name of small business issuer as specified in its charter) (State or other juris ...

Financial Data and Key Metrics Changes - In Q1 of fiscal 2020, revenue was $4.8 million, down 19% from $5.9 million in the same quarter in 2019, primarily due to a decrease in non-recurring revenue [14] - Recurring revenue grew 4% to $4.1 million, up from $3.9 million in the same quarter of 2019, with total recurring revenue increasing from 66% to 85% of total revenue [14][15] - Net income for Q1 of fiscal 2020 was $32,000 or $0.00 per diluted share, compared to $820,000 or $0.04 per diluted share in the prior year [18] Business Line Data and Key Metrics Changes - Non-recurring revenue was $700,000 in Q1 of fiscal 2020, down from over $2 million in the same quarter last year [16] - Total operating expenses decreased by 5% to $4.7 million, largely due to lower sales and marketing expenses [17] - Customer churn remained below 2%, indicating strong customer retention [15] Market Data and Key Metrics Changes - As of September 30, the company had approximately 340,000 total connections, a 13% increase year-over-year [30] - Tier 2 revenue increased 8% year-over-year for the quarter, with a run rate at the end of the quarter 35% higher than the same point last year [31] Company Strategy and Development Direction - The company is focused on transitioning to a more predictable and profitable recurring revenue model, aiming to increase the percentage of recurring revenue to 80% or more [10][55] - The strategy includes expanding the network of blue-chip customers and enhancing the MarketPlace solution to drive transactional business [10][41] - The company plans to grow its Tier 2 initiative significantly, targeting a 400% increase in Tier 2 hubs by the end of the fiscal year [38][53] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by online retailers like Amazon and emphasized the importance of their out-of-stock management capabilities [44][82] - The management expressed confidence in the company's ability to grow recurring revenue and improve forecasting for Wall Street [55][70] - The company aims to maintain a strong balance sheet while continuing to buy back shares without additional borrowing [56] Other Important Information - Cash flow from operations for Q1 of fiscal 2020 was $713,000, down from $1.6 million in the prior year [19] - The company repurchased 79,955 shares of common stock at an average price of $6.47 per share during the quarter [20] Q&A Session Summary Question: Update on hiring specialists for Tier 2 or MarketPlace - Management confirmed two specialists are focused on Tier 2 conversions, with plans to add more personnel in the future [60][61] Question: Any large license deals in upcoming quarters that could create lumpiness? - Management indicated that there are license deals in the next quarter, but the focus is on avoiding such transactions moving forward [66][67] Question: How are cross-selling efforts performing? - Management reported better-than-expected results, with examples of compliance hubs transitioning to supply chain services [77] Question: Impact of Amazon's free delivery for grocery on the industry - Management highlighted that Amazon's quick delivery poses a significant threat to physical retail, emphasizing the importance of addressing out-of-stock issues [82] Question: What might margins look like when recurring revenue targets are met? - Management stated that the margins for recurring revenue would be similar to those for one-time revenue, with a strong cash flow structure in place [87][88]