Archive for 2012

Park City Group to Present at the LD MICRO Investor Conference December 6, 2012 in Los Angeles

PARK CITY, Utah — November 30, 2012 — Park City Group, (NYSE MKT: PCYG), a Software-as-a-Service (SaaS) provider of unique supply chain solutions for retailers and their suppliers, today announced that Randall K. Fields, Chairman and Chief Executive Officer, will present at the LD MICRO Investor Conference on December 6, 2012, at the Luxe Sunset Bel Air Hotel in Los Angeles. Park City Group’s presentation is scheduled to begin at 8:00 a.m. Pacific Time.

For additional information regarding the LD Micro Conference, please visit: www.ldmicro.com.

Park City Group (NYSE Amex: PCYG) is a Software-as-a-Service (“SaaS”) provider that brings unique visibility to the consumer goods supply chain, delivering actionable information that ensures product is on the shelf when the consumer expects it as well as providing food safety tracking information. The Company’s services increase customers’ sales and profitability while enabling lower inventory levels and ensuring regulatory compliance for both retailers and their suppliers.

Through a process known as Consumer Driven Sales OptimizationTM, Park City Group helps its customers turn information into cash and increased sales, using the largest scan based platform in the world. Scan based trading provides retail trading partners with a distinct competitive advantage through scan sales that provides store level visibility and sets the supply chain in motion. And since it is scan based, it can be used in a Direct Store Delivery (DSD) or warehouse setting.

ReposiTrakTM provides food retailers and suppliers with a robust solution that will help them protect their brands and remain in compliance with rapidly evolving regulations in the recently passed Food Safety Modernization Act. An internet-based technology, ReposiTrakTM, will enable all participants in the farm-to-table supply chain to easily manage tracking and traceability requirements as products move between trading partners.

Park City Group Issues Annual Letter to Shareholders

Highlights Progress; Discusses Customer Base and Software Solutions

PARK CITY, Utah – November 26, 2012– Park City Group (NYSE MKT: PCYG), a Software-as-a-Service (SaaS) provider of unique supply chain solutions for retailers and their suppliers, today released its annual letter from Chairman and CEO, Randall K. Fields, to the Company’s shareholders.

To our Shareholders:

Fiscal 2012 marked the successful completion of a three-year transition of our business from a license to a software-as-a-service model. During this process our subscription revenue, which reached a record level of $7.0 million, increased from 10% to 70% of total revenue. With subscription customer renewal rates in excess of 90 percent, going forward our new business model will have a more predictable recurring revenue stream. Within the revenue mix, we expect “other revenue”, which includes legacy license revenue, to remain at approximately 30 percent of overall sales and total revenue to grow more closely in parallel to that of subscription revenue.

Like most software companies, we have an “asset-light” business model, in which a large portion of each incremental sales dollar falls to the bottom line. We have the infrastructure in place to scale our business to well over $100 million in revenue without having to add substantially to our fixed costs. With the strength of this model, we are currently generating positive free cash flow and using that cash to pay down debt. Over the past three years, we have reduced debt from $8.7 million to $2.7 million, a decrease of 69 percent.

During the past 15 years, our Company has invested more than $150 million to develop a cloud-based technology platform that allows retailers and their suppliers to make sense of the millions of consumer transactions that occur daily and use that information to reduce out of stocks, increase sales, and lower inventory levels throughout the supply chain.

Beyond the financial benefits of increased sales and lower inventories, our supply chain management solutions also offer long-term strategic benefits to retailers and suppliers. By increasing their in-stock positioning and using capital freed up from lower inventories to remodel their stores, our retail customers are able to improve the shopping experience and create greater customer loyalty. By enabling retailers and suppliers to share accurate information about store level sales, our solutions align the financial interest of both parties. Retailers enlist the brain power of the suppliers to keep the stores in stock and suppliers are able to use more accurate information to have the right amount of inventory at each stage of the supply chain. With accurate inventory levels, there is less need to sell “on deal” to clear out excess inventory, allowing suppliers to capture more margin dollars.

Using our base-level service, our customers are able to create perpetual inventories by store and by SKU to diagnose out-of-stocks and overstocked situations. Increasingly, our customers are also buying additional supply chain modules that allow them to not only diagnose issues within their supply chain, but also to solve those issues. Expanding services with existing customers further strengthens the strategic aspect of our relationship and expands the average revenue generated per customer by an order of magnitude from a few hundred dollars per month per connection to a few thousand dollars per month. Here are a few examples:

Retailer Example: A northeastern, ‘Best-in-Class’ Retailer implemented Park City Group’s Computer Assisted Ordering from their distribution centers. They subsequently reduced inventory quantities by a third, reduced inventory costs by $125 million across grocery, dairy, frozen, general merchandise and health and beauty care departments, and reduced safety stock by 55%.

Supplier Example: Required to manage their own ordering and replenishment, a mid-western dairy implemented Park City Group’s Store-level Replenishment solution and documented a 75% time savings in ordering, and reduced their returned product (known as dumps in the dairy business) by 50% in one retailer’s chain and 15% in another.

Supplier Example: A well-known national bakery implemented Park City Group’s scan-based trading platform to manage all of their SBT business with a consistent process. As a result of better process management of errors that typically contribute to shrink, they are able to maintain a shrink percentage of 0.40% or less, whereas the industry retailer average is 1% to 2%.

Retailer Example: Park City Group showed a southeastern regional retailer that their top five dollar volume SKUs made up over 29% of their lost sales opportunities equaling over $20,000 during a 2-month period. Proactive identification and management of these ‘outside the norm’ sales trends through Park City Group’s DSD Visibility & Analytics solution signaled the store personnel to take action.

Supplier Example: After implementing Park City Group’s Store-level Replenishment solution, a mid-western dairy documented a 35% increase in unit sales, a 50% to 66% reduction in store-level inventory and were able to reduce expensive in-freezer assets (carts).

Retailer Example: Using visibility into point-of-sale and trends in purchasing, Park City Group used their DSD Visibility & Analytics solution to show a northwest regional retailer how adjusting shelf facings and inventory based on point-of-sale data could increase sales and reduce slow moving product from their expansive cereal aisle. Net results focused on a $5k per month sales increase and a $120k inventory reduction.

We have established a leadership position in the grocery store industry and have customer relationships with more than 40 grocery chains, including well-known chains such as Target, Wal-Mart, and Meyer. We have also established a leadership position in certain consumer packaged goods categories such as bread and dairy, and are rapidly moving into new categories. We have more than 150 supplier customers, many of which view us as strategic partners.

During 2012, we entered into two new retail verticals with our first drug store chain and club warehouse customer wins. I am particularly excited about the large drug store chain, which has more than 7,000 doors across the country. At maturity, we expect subscription revenue generated from suppliers connected to this customer to be significantly larger than any of our existing customers.

Since the end of the fiscal year, our Food & Drug Safety partnership with Leavitt Partners has begun its first two implementations of the ReposiTrakTM track and trace solution. With a very low monthly cost per supplier per month and each retailer having thousands of supplier connections, we believe that there is a very large addressable market for this solution and are excited about our initial engagements and the response we have received. We expect that this partnership will also fuel growth of our supply chain management solutions, as many of our launch customers for ReposiTrakTM have led to follow-on conversations about our other end-to-end solutions.

We are beginning to gain critical mass in the grocery store vertical by clearly demonstrating our value proposition to a growing list of retailer and supplier customers. It is important to remember that we are changing the way retailers and suppliers do business with each other and at the earlier stages of change, customers are often cautious about their pace of adoption. During this period, we are also carefully managing the pace of growth, as it is critical that we deliver flawless execution for our customers. With that said, over the past several quarters, our pace of growth has begun to accelerate and we expect that pace to accelerate substantially in 2013. In addition to the benefit from our expanding hub and spoke network, we expect growth to be fueled by our entrance into new vertical markets and the adoption of our food and drug safety track and trace solution.

As the chairman and largest shareholder of Park City Group, I am proud of the accomplishments of our team over the last three years and I am excited about the future of our company. I want to recognize the hard work and dedication of our employees. We have a great staff in place and I appreciate their extra and ongoing efforts to execute our plan. We are committed to making Park City Group a truly great company, partner, investment, and employer. I look forward to keeping you apprised of our progress.

Warmest regards,

Randall K. Fields, Chairman and CEO

About Park City Group

Park City Group (NYSE Amex: PCYG) is a Software-as-a-Service (“SaaS”) provider that brings unique visibility to the consumer goods supply chain, delivering actionable information that ensures product is on the shelf when the consumer expects it as well as providing food safety tracking information. The Company’s services increase customers’ sales and profitability while enabling lower inventory levels and ensuring regulatory compliance for both retailers and their suppliers.

Through a process known as Consumer Driven Sales OptimizationTM, Park City Group helps its customers turn information into cash and increased sales, using the largest scan based platform in the world. Scan based trading provides retail trading partners with a distinct competitive advantage through scan sales that provides store level visibility and sets the supply chain in motion. And since it is scan based, it can be used in a Direct Store Delivery (DSD) or warehouse setting.

ReposiTrakTM provides food retailers and suppliers with a robust solution that will help them protect their brands and remain in compliance with rapidly evolving regulations in the recently passed Food Safety Modernization Act. An internet-based technology, ReposiTrakTM, will enable all participants in the farm-to-table supply chain to easily manage tracking and traceability requirements as products move between trading partners.

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.

Investor Relations Contact:

Dave Mossberg
Three Part Advisors, LLC
P.O. Box 92698
Southlake, TX 76092
Phone: (817) 310-0051
dmossberg@threepa.com
www.threepa.com

Park City Group Reports Record First Quarter Fiscal 2013 Results

Record Quarterly Subscription Revenue and Net Income

  • Record quarterly subscription revenue of $2.0 million, a 12% increase year over year
  • Total quarterly revenue of $2.7 million, a 5% increase year over year
  • Quarterly free cash flow of $222,000, versus ($76,000) during the same quarter last year
  • Record quarterly net income of $204,000, versus a net loss of ($280,000) during prior year
  • Quarterly non-GAAP EPS of $0.03, versus non-GAAP EPS of ($0.00) during the prior year
  • Net debt decreased 36% to $1.5, versus $2.4 million at the same time last year.
  • Provides outlook for record financial results during FY13.


PARK CITY, Utah – November 8, 2012 — Park City Group (NYSE MKT: PCYG), a Software-as-a-Service (SaaS) provider of unique supply chain solutions for retailers and their suppliers, today announced results for its fiscal first quarter ended September 30, 2012.
 
“Since we began the shift from a licensing to a subscription model, our quarterly subscription revenue has grown from less than $100,000, to a record of $2.0 million during the first quarter of fiscal 2013. Due to the recurring nature of subscription revenue and our high rates of renewal, we have a revenue engine that can deliver predictable and sustainable growth for the next several years. Combined with the “asset light” nature of our business model that supports significant growth with limited incremental fixed costs, our bottom line growth will outpace the top line and we will continue to build on the record performance we delivered during the first quarter,” said Randall K. Fields, Park City Group’s Chairman and CEO.

Subscription revenue during the first quarter increased 12% to $2.0 million, reflecting growth in sales to new and existing customers. Total revenue increased 5% to $2.7 million, as double digit growth in subscription revenue was partially offset by a 9% decrease in other revenue. “The growth of subscription revenue kept up with the accelerated pace of recent quarters, as we expanded the scope of our existing customer relationships, moved into new retail verticals outside of the grocery industry, and benefited from the adoption of our technology as the standard for tracking and tracing food and drugs safely throughout the global supply chain. In the coming quarters, we expect further acceleration as recent agreements with large retail hubs begin to contribute to revenue,” said Mr. Fields.

Profitability

Total operating expenses during the quarter ended September 30, 2012 decreased 12% year over year to $2.5 million. The decrease in operating expenses was due to decreases in all expense categories, with the exception of depreciation and amortization costs, which remained relatively unchanged versus the prior year. Combined with incremental margin contribution from increased sales and lower interest costs, first quarter net income increased to a record $204,000 versus a net loss of ($280,000) during the same period last year. “We saw a $480,000 swing in profitability during the first quarter, which illustrates our continued focus on cost control and the operating leverage in our business model. While we expect the operating expense run rate to increase modestly during the course of the year, primarily due to additional sales headcount, we expect our bottom line growth to continue to outpace the top line as we continue to benefit from this leverage,” said Mr. Fields.

Net loss available to common shareholders for the quarter ended September 30, 2012 was ($6,000), or break even on a per share basis, as compared to a net loss of ($488,000), or ($0.04) per share, during the prior year period. Non-GAAP earnings per share for the first quarter was $0.03 versus break even during the same period last year.

Cash

During the quarter ended September 30, 2012, free cash flow was $222,000, compared to ($76,000) during the same period last year. Total Cash at the end of the September 30, 2012 was $1.1 million, and net debt declined by 36% to $1.5 million, versus $2.4 million at the end of September 30, 2011. The Company expects to use its free cash flow to continue to reduce net debt to a level at, or below $1.0 million. Beyond that, excess free cash flow is expected to be used to repurchase shares under the Company’s recently announced share repurchase plan.

“With our strong performance in the first quarter, we are on track to achieve record subscription revenue, record total revenue, and record net income for the fiscal year. Our food and drug safety partnership, ReposiTrak™, is already garnering significant interest and is helping us to access a much larger base of global food and drug retailers and suppliers. Not only does this greatly expand the size and rate of growth of our “hub and spoke” network, it also provides significant opportunity to upsell these network connections to purchase additional supply chain management solutions. In addition, increasingly our focus is turning to larger customer opportunities. Both of these factors will provide meaningful revenue contribution in the quarters and years to come,” Mr. Fields concluded.

The conference call is also being webcast and is available via the investor relations section.

About Park City Group

Park City Group (NYSE Amex: PCYG) is a Software-as-a-Service (“SaaS”) provider that brings unique visibility to the consumer goods supply chain, delivering actionable information that ensures product is on the shelf when the consumer expects it as well as providing food safety tracking information. The Company’s service increases customers’ sales and profitability while enabling lower inventory levels and ensuring regulatory compliance for both retailers and their suppliers.

Through a process known as Consumer Driven Sales OptimizationTM, Park City Group helps its customers turn information into cash and increased sales, using the largest scan based platform in the world. Scan based trading provides retail trading partners with a distinct competitive advantage through scan sales that provides store level visibility and sets the supply chain in motion. And since it is scan based, it can be used in a Direct Store Delivery (DSD) or warehouse setting.

ReposiTrak™ provides food retailers and suppliers with a robust solution that will help them protect their brands and remain in compliance with rapidly evolving regulations in the recently passed Food Safety Modernization Act. An internet-based technology, ReposiTrak™, will enable all participants in the farm-to-table supply chain to easily manage tracking and traceability requirements as products move between trading partners.

Non-GAAP Financial Measures

This press release includes the following financial measures defined as “non-GAAP financial measures” by the Securities and Exchange Commission: non-GAAP EBITDA, non-GAAP earnings per share, net debt and free cash flow. 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, charges to consolidate and integrate recently acquired businesses, costs of closing corporate facilities, 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, charges to consolidate and integrate recently acquired businesses, costs for closing corporate facilities, amortization of acquired intangible assets and other one-time cash and non-cash charges. Net debt is the total debt balance less the cash balance. Free cash flow includes net cash provided (used) by operating activities less replacement purchases of property and equipment. 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. In addition, because Park City Group has historically reported certain non-GAAP results to investors, the Company believes that the inclusion of non-GAAP measures provides consistency in the Company’s financial reporting.

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.

Dave Mossberg
Three Part Advisors, LLC
P.O. Box 92698
Southlake, TX 76092
Phone: (817) 310-0051
dmossberg@threepa.com
www.threepa.com



PARK CITY GROUP, INC. AND SUBSIDIARIES
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PARK CITY GROUP, INC. AND SUBSIDIARIES
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PARK CITY GROUP, INC. AND SUBSIDIARIES
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Adjusted EBITDA
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PARK CITY GROUP, INC. AND SUBSIDIARIES
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PARK CITY GROUP, INC. AND SUBSIDIARIES
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Supermarket Industry Veterans Richard Juliano and Austin Noll Join Park City Group Board

Former Daymon President Peter Brennan to retire from board

PARK CITY, UTAH – Park City Group (NYSE Amex: PCYG), a leader in consumer goods supply chain technology designed to increase sales and reduce out-of-stocks, today announced the addition of food industry insiders Austin F. Noll, Jr. and Richard Juliano to the company’s Board of Directors. Peter Brennan, who has served on the board since 2009, has announced his retirement from the board for personal reasons. All moves are effective immediately.

Noll and Juliano join Randall Fields, Robert Allen, James Gillis, Bob Hermanns and William Kies, Jr. on one of retail technology’s most experienced boards, with an average of more than 35 years in the industry. The group represents all areas of the retail grocery, convenience, foodservice and discount channels, as well as trading partners and industry groups.

“The addition of Rich and Austin creates a powerhouse Board of Directors, extending our already impressive reach into retailers, distributors and manufacturers throughout the industry. Through these relationships, we now have access to most of the key executives at leading food and supermarket companies across the country and will use these connections to expand our footprint in the sector,” said Randall K. Fields, Chairman and CEO of Park City Group.

“The Park City Group Board of Directors also thanks Peter Brennan for his years of service and support of the company. We will miss his sage advice and wish him well.”

Rich Juliano

Juliano is currently engaged with The Radian Group, based in Minneapolis, and operates his own consulting firm. He began his career with Giant Eagle Super Markets, becoming the Senior Vice President and General Manager of the GM/HBC Division and then Senior Vice President of Merchandising and Marketing of the Phar-Mor Division. Juliano then served as Executive Vice President at Thrifty Payless Drug and Vice President of Marketing and Merchandising at Genuardis Family Markets in Philadelphia. Most recently, he was a senior executive at SUPERVALU, joining the company as Executive Vice President of Supply Chain Services for the Central Region and then moving to the Corporate Retail group as Vice President, GM/HBC, and ultimately Group Vice President of Center Store Merchandising.

Juliano has served on the Red Cross of Columbiana County Board of Directors, National Association of Chain Drug Stores Advisory Board, Global Market Development Center Board of Directors and Youngstown State University Athletic Board. He currently is on the President’s Innovative Network Board at GMDC.

Austin Noll

Noll is the owner of Austin Noll & Associates, a trade relations and industry affairs consultancy based in New Jersey. Noll started his career with General Foods, spending 22 years in sales related positions. He then became Vice President of Trade Relations for the grocery division of Borden Inc., and was promoted to Vice President of Industry and Trade Relations, before moving to Nabisco Inc. as Senior Vice President of Industry and Trade Relations.

Noll has served on the Trade Advisory Boards of Grocery Manufacturing Association, Food Marketing Institute, National Grocers Association, North American Wholesale Grocers Association, Western Association of Food Chains and IGA. He is currently a member of the Board of Directors of Food for All and a founding member of the Trade Advisory Board of Instant Combo Savings.

About Park City Group

Park City Group (NYSE Amex: PCYG) is a Software-as-a-Service (“SaaS”) provider that brings unique visibility to the consumer goods supply chain, delivering actionable information that ensures product is on the shelf when the consumer expects it as well as providing food safety tracking information. The Company’s service increases customers’ sales and profitability while enabling lower inventory levels and ensuring regulatory compliance for both retailers and their suppliers.

Through a process known as Consumer Driven Sales OptimizationTM, Park City Group helps its customers turn information into cash and increased sales, using the largest scan based platform in the world. Scan based trading provides retail trading partners with a distinct competitive advantage through scan sales that provides store level visibility and sets the supply chain in motion. And since it is scan based, it can be used in a Direct Store Delivery (DSD) or warehouse setting.

ReposiTrakTM provides food retailers and suppliers with a robust solution that will help them protect their brands and remain in compliance with rapidly evolving regulations in the recently passed Food Safety Modernization Act. An internet-based technology, ReposiTrakTM, will enable all participants in the farm-to-table supply chain to easily manage tracking and traceability requirements as products move between trading partners.

Hispanic Retailer Cardenas Markets Picks Park City Group to Optimize Store-Level Inventory

ONTARIO, CA – Cardenas Markets, a 28-store chain operating in California and Nevada, is partnering with Park City Group (NYSE Amex: PCYG), a leader in consumer goods supply chain technology, to increase sales and reduce out-of-stocks. Cardenas Markets will use technology from Park City Group to increase shelf visibility of products delivered directly by suppliers and optimize inventory at each store based on consumer demand.

Park City Group’s suite of solutions will enable Cardenas Markets and their trading partners to drive operational efficiencies, increase sales and optimize performance in their supply chains. The web-based applications provide visibility into store-level product movement, allowing suppliers to spend more time merchandising product and removing time-consuming operational labor from the retailer-supplier relationship.

Quotes

“At Cardenas Markets, we are all about engaging our customers by anticipating and fulfilling their needs. Park City Group solutions help us improve our knowledge of shopper behaviors and enable us to make better marketing and merchandising decisions.”
Trina Guoz, Director of Purchasing, Cardenas Markets, Inc.

“We’re proud of our partnership with Cardenas Markets, a well respected, innovative and successful retailer. As the retail industry becomes more competitive, leading retailers will continue to find new ways to offer great value based on a comprehensive understanding of their shoppers.”
Randall K. Fields, Chairman and CEO of Park City Group.

About Cardenas Markets

At Cardenas Markets our customers are part of the family. Our commitment is to make your shopping experience unique and enjoyable, and to provide you with an excellent selection of quality products, with specialties and flavors from Latin America. From our house to yours, we are proud to serve you. More information is available at www.cardenasmarkets.com.

About Park City Group

Park City Group (NYSE Amex: PCYG) is a Software-as-a-Service provider that brings unique visibility to the consumer goods supply chain. With over $100 million invested in development and 16 years of commercialization surrounding its proprietary scan based data platform, the Company’s services increase customers’ sales and profitability, while ensuring regulatory compliance for both retailers and their suppliers. Through a process known as Consumer Driven Sales OptimizationTM, Park City Group helps retail and consumer packaged goods customers turn transactional information into actionable strategies to lower inventory, increase sales and improve efficiencies in the supply chain.

Media Contacts
Ronald Margulis (For Park City)
RAM Communications
908.272.3930
ron@rampr.com

Trina Guoz, Director of Purchasing
Cardenas Markets, Inc.
909.923.7426
tguoz@cmkts.com

Investor Contact
Dave Mossberg (For Park City)
Three Part Advisors, LLC
817.310.0051

Park City Group Reports Fourth Quarter and Full Year 2012 Results

Successfully Completes 3-year Transition from License to Software-as-a-Service Model Reports Record Annual Subscription Revenue

  • 4Q12 record subscription revenue of $1.9 million, an 11% increase year over year
  • Fiscal 2012 record annual subscription revenue of $7.0 million, a 7% increase year over year
  • 4Q12 free cash flow of $270,000
  • Fiscal 2012 free cash flow of $769,000
  • 4Q12 GAAP EPS ($0.02), versus ($0.00) during 4Q11
  • Fiscal 2012 GAAP loss per share ($0.14), versus ($0.09) during Fiscal 2011
  • 4Q12 non-GAAP EPS of $0.01, versus EPS of $0.03 during 4Q11
  • Fiscal 2012 non-GAAP loss per share of ($0.00), versus EPS of $0.07 during Fiscal 2011
  • First major win in new retail vertical market
  • Food safety partnership begins major implementations with the first retailer and supplier

PARK CITY, Utah – September 25, 2012 — Park City Group (NYSE Amex: PCYG), a Software-as-a-Service (SaaS) provider of unique supply chain solutions for retailers and their suppliers, today announced results for its fiscal fourth quarter and fiscal year ended June 30, 2012.

“2012 marked the successful completion of our three-year plan to transform the company from a license to a subscription revenue model. During the process we were successful in doubling the size of the business, shifting the mix of subscription revenue from 6% to 70% of total revenue, organically growing subscription revenue by nearly 40%, and at the same time reducing debt by nearly 70%,” said Randall K. Fields, Park City Group’s Chairman and CEO. “During that same period, we proved our ability to add new retailers “hubs” and suppliers “spokes” to our network, put in place the infrastructure to support rapid growth in connections between suppliers and retailers, and sell additional services to both suppliers and retailers in our network. With that process in our rear view mirror we are well positioned and will now accelerate the pace of growth.”

2012 Accomplishments

  • New Retail Vertical Market –During 2012, the Company made an agreement with one of a leading drug store chains in the U.S., marking its first retail customer outside of the grocery industry. “This, along with several other initiatives, demonstrates the value proposition of our technology in other new markets,” said Mr. Fields.
  • Growth of End-to-end Supply Chain Services – The Company announced that it is implementing additional supply chain management point solutions with a number of existing retail and supplier customers. “This year we have proven our ability to transition from a supplier of a diagnostic tool to a strategic partner offering end-to-end supply chain management solutions that can not only diagnose problems within customer supply chains, but also provide solutions to fix those problems,” Mr. Fields said.
  • Food Safety –The Company announced that its Food & Drug Safety partnership with Leavitt Partners has begun its first two implementations of the ReposiTrakTM track and trace solution. “We believe that there is a very large addressable market for this solution and are excited about our initial engagements and the response we have received. We expect this partnership will also fuel the growth of our supply chain management solutions, as many of our launch customers for ReposiTrakTM have led to follow-on conversations about our other end-to-end solutions,” said Mr. Fields.

Revenue

Subscription revenue during the fourth quarter increased 11% to $1.9 million, reflecting growth in sales to new and existing customers. Primarily related to the Company’s strategic shift to a subscription revenue model, total revenue and other revenue declined 17%, and 56% respectively. “As anticipated, subscription revenue growth accelerated during the fourth quarter. In addition, we finalized agreements with large retail hubs that should allow for further acceleration in the coming quarters. With our transition to a subscription model complete, we believe license related revenue will stabilize at its current level of approximately 30% of sales,” said Mr. Fields.

Subscription revenue from new and existing customers increased $1.2 million, or 18% from the prior year, and was offset by previously announced customer attrition, which included the non-renewal of a significant retail client and related connections in January 2012. As a result, subscription revenue increased 7% to $7.0 million during the fiscal year. “Accelerating growth of new and existing customers more than offset business that we believed was not in the best interest of the Company and elected not to pursue,” said Edward L. Clissold, Park City Group’s Chief Financial Officer. Other revenue for the fiscal year ended June 30, 2012 was $3.1 million, a decrease of 26% over the prior year. Total revenue for fiscal 2012 was $10.1 million, a 6% decrease from the prior year. The decline was principally due to the Company’s strategic shift to a subscription revenue model.

Net (Loss) Income

Net loss available to common shareholders for the quarter ended June 30, 2012 was ($259,000), or ($0.02) per share, as compared to a net loss of ($49,000), or ($0.00) per share, during the prior year period. Non-GAAP earnings per share for the fourth quarter was $0.01 versus $0.03 during the same period last year.

For the fiscal year ended June 30, 2012, the net loss available to common shareholders was $1.7 million, or ($0.14) per share, compared to a net loss of $1.0 million, or ($0.09) per share, during the same period in fiscal 2011. Non-GAAP loss per share for fiscal 2012 was ($0.00) versus earnings per share of $0.07 during the same period last year.

Cash

During the quarter ended June 30, 2012, free cash flow was $270,000, compared to $524,000 during the same period last year. For fiscal 2012, free cash flow was $769,000 versus $1,194,000 reported during fiscal 2011. Total cash at the end of the fiscal 2012 was $1.1 million, and net debt declined by 29% to $1.6 million at June 30, 2012.

“The heavy lifting has been done to build an infrastructure capable of providing exceptional service to our customers. The fourth quarter marked an inflection point in the growth of our subscription revenue. With opportunities that we already have in place to provide base-level services to our existing retail/ supplier network, we can reasonably anticipate significant revenue growth for the next several years. Beyond that, we expect to layer on additional growth as we take advantage of opportunities with food and drug safety, new retail verticals, new services, and continue to expand the size of the network,” Mr. Fields concluded.

The Company will host a conference call at 4:30 P.M. Eastern today, September 25, 2012, to discuss the results. Investors and interested parties may participate in the call by dialing (877) 675-3568 and referring to Conference ID: 33030391. The conference call is also being webcast and is available via the investor relations section. A toll free replay of the conference call will be available until October 2, 2012 by dialing (855) 859-2056 and entering conference ID: 33030391.

About Park City Group

Park City Group (NYSE Amex: PCYG) is a Software-as-a-Service (“SaaS”) provider that brings unique visibility to the consumer goods supply chain, delivering actionable information that ensures product is on the shelf when the consumer expects it as well as providing food safety tracking information. The Company’s service increases customers’ sales and profitability while enabling lower inventory levels and ensuring regulatory compliance for both retailers and their suppliers.

Through a process known as Consumer Driven Sales OptimizationTM, Park City Group helps its customers turn information into cash and increased sales, using the largest scan based platform in the world. Scan based trading provides retail trading partners with a distinct competitive advantage through scan sales that provides store level visibility and sets the supply chain in motion. And since it is scan based, it can be used in a Direct Store Delivery (DSD) or warehouse setting.

ReposiTrakTM provides food retailers and suppliers with a robust solution that will help them protect their brands and remain in compliance with rapidly evolving regulations in the recently passed Food Safety Modernization Act. An internet-based technology, ReposiTrak™, will enable all participants in the farm-to-table supply chain to easily manage tracking and traceability requirements as products move between trading partners.

Non-GAAP Financial Measures

This press release includes the following financial measures defined as “non-GAAP financial measures” by the Securities and Exchange Commission: non-GAAP EBITDA, non-GAAP earnings per share, non-GAAP loss per share, net debt and free cash flow. 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, charges to consolidate and integrate recently acquired businesses, costs of closing corporate facilities, 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, charges to consolidate and integrate recently acquired businesses, costs for closing corporate facilities, amortization of acquired intangible assets and other one-time cash and non-cash charges. Net debt is the total debt balance less the cash balance. Free cash flow includes net cash provided (used) by operating activities less replacement purchases of property and equipment. 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 operating results and business outlook. In addition, because Park City Group has historically reported certain non-GAAP results to investors, the Company believes that the inclusion of non-GAAP measures provides consistency in the Company’s financial reporting.

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.

Dave Mossberg
Three Part Advisors, LLC
P.O. Box 92698
Southlake, TX 76092
Phone: (817) 310-0051
dmossberg@threepa.com
www.threepa.com



PARK CITY GROUP, INC. AND SUBSIDIARIES
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PARK CITY GROUP, INC. AND SUBSIDIARIES
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PARK CITY GROUP, INC. AND SUBSIDIARIES
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PARK CITY GROUP, INC. AND SUBSIDIARIES
Reconciliation of GAAP and Non-GAAP Financial Measures


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Park City Group, Inc. Schedules Fourth Quarter and Fiscal Year-end 2012 Earnings Conference Call and Webcast

PARK CITY, Utah. – Sept 10, 2012 – Park City Group (NYSE Amex: PCYG), a Software-as-a-Service provider of unique supply chain solutions for retailers and their suppliers, today announced the Company plans to release results for its fiscal fourth quarter and year-end 2012 after the Market closes on Tuesday, September 25, 2012. Randall K. Fields, Chairman and CEO, will host a conference call at 4:30 P.M. Eastern that day to discuss the Company’s results. Investors and interested parties may participate in the call by dialing (877)675-3568 and referring to Conference ID: 26933476. The conference call is also being webcast and is available via the investor relations section.

Park City Group (NYSE Amex: PCYG) is a Software-as-a-Service (“SaaS”) provider that brings unique visibility to the consumer goods supply chain, delivering actionable information that ensures product is on the shelf when the consumer expects it as well as providing food safety tracking information. The Company’s service increases customers’ sales and profitability while enabling lower inventory levels and ensuring regulatory compliance for both retailers and their suppliers.

Through a process known as Consumer Driven Sales OptimizationTM, Park City Group helps its customers turn information into cash and increased sales, using the largest scan based platform in the world. Scan based trading provides retail trading partners with a distinct competitive advantage through scan sales that provides store level visibility and sets the supply chain in motion. And since it is scan based, it can be used in a Direct Store Delivery (DSD) or warehouse setting.

ReposiTrakTM provides food retailers and suppliers with a robust solution that will help them protect their brands and remain in compliance with rapidly evolving regulations in the recently passed Food Safety Modernization Act. An internet-based technology, ReposiTrak™, will enable all participants in the farm-to-table supply chain to easily manage tracking and traceability requirements as products move between trading partners.

Dave Mossberg
Three Part Advisors, LLC
P.O. Box 92698
Southlake, TX 76092
Phone: (817) 310-0051
dmossberg@threepa.com
www.threepa.com


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