TRAK ReposiTrak Inc

Traceability Onboarding Continues to Accelerate as Industry Recalls Drive Supplier Urgency

ReposiTrak (NYSE: TRAK), the world's largest food traceability and regulatory compliance network, built upon its proven inventory management and out-of-stock reduction SaaS platform, today announced financial results for the first fiscal quarter (“FQ1 2025”) ended September 30, 2024.

First Fiscal Quarter Financial Highlights:

• First quarter total revenue increased 8% to $5.4 million from $5.1 million.
• Recurring revenue increased 6%, reflecting non-recurring initial set-up fees for the rapidly increasing number of traceability customers onboarding to the system.
• Quarterly operating expense increased 3% to $4.0 million from $3.9 million.
• Quarterly operating income increased 23% to $1.5 million from $1.2 million last year.
• Quarterly GAAP net income increased 21% to $1.7 million from $1.4 million last year.
• Quarterly net income to common shareholders was $1.6 million, up 26% from $1.2 million last year.
• Quarterly EPS of $0.09 compared to $0.07 in the prior year first fiscal quarter.
• The Company finished the quarter with $25.8 million in cash and no bank debt.
• During the quarter, the Company redeemed 70,093 preferred shares for the stated redemption price of $10.70 per share for a total of $749,995.

Randall K. Fields, Chairman and CEO of ReposiTrak, commented, “Traceability continues to exceed our expectations. The cadence of onboarding is accelerating, reaching a record level in the last month, driven by three significant catalysts. First, the recent spate of recalls due to deadly listeria, E. coli and other contaminations, is driving demands for improved food safety. Second, more and more major retailers, including the three largest in the U.S., are now requiring all food be traced, massively increasing the addressable market. And third, the FDA mandate deadline is rapidly approaching.”

“We are well-positioned to address the growing challenge of enabling the industry to meet the requirements,” continued Mr. Fields. “We continue to utilize automation to more efficiently collect the required data, but our commitment to our customers requires us to move at a measured pace to ensure accuracy. When fully onboarded, customers in-hand today are sufficient to increase our revenue by approximately 50%. We will continue to add to this pipeline as we approach the January, 2026 deadline.”

“We are confident that customers in-hand plus our pipeline will result in a doubling of our annual recurring revenue over the next three years,” concluded Mr. Fields. “This confidence is supported by our growing pipeline, the commitment from major retailers, including three of the largest food retailers in the United States, to expand traceability to the entire food supply chain.”

First Fiscal Quarter Financial Results (three months ended September 30, 2024, vs. three months ended September 30, 2023):

Total revenue was up 8% to $5.4 million as compared to $5.1 million in the prior-year first quarter. Total operating expense was $4.0 million, up 3% compared to $3.9 million last year. General and administrative expense increased by 1%. GAAP net income was $1.7 million compared to $1.4 million. Net income to common shareholders was $1.6 million, or $0.09 per basic and $0.08 per fully diluted share, compared to $1.2 million, or $0.07 per basic and fully diluted share.

Return of Capital:

In the first quarter of fiscal 2025, the Company redeemed 70,093 preferred shares at the stated redemption price of $10.70 per share for a total of $749,995. To date, the Company has redeemed 291,400 shares of preferred stock for a total of $3.1 million. The remaining amount of the preferred share redemption is $5.8 million. As previously announced, the Company anticipates redeeming all of its preferred shares issued and outstanding over the next three years. In addition, the Company has approximately $8 million remaining of the $21 million total common share buyback authorization.

On September 19, 2024, the Company’s Board of Directors declared a quarterly cash dividend of $0.0165 per share ($0.066 per year), payable to shareholders of record on September 30, 2024, which was paid to shareholders of record on or about November 13, 2024. On September 30, 2024, the Board of Directors approved another 10% increase to ReposiTrak’s quarterly dividend, to $0.01815 per quarter ($0.0726 per share annually) beginning with the dividend payable to shareholders of record on December 31, 2024. Subsequent dividends will be paid within 45 days of each fiscal quarter end.

Balance Sheet:

The Company had $25.8 million in cash and cash equivalents at September 30, 2024, compared to $25.2 million at June 30, 2024. Given the Company’s liquidity, the Company chose not to renew its working line of credit. The Company carries no bank debt.

Conference Call:

The Company will host a conference call at 4:15 p.m. Eastern today to discuss the Company’s results. The conference call will also be webcast and will be available via the investor relations section of the Company’s website, www.repositrak.com.

Participant Dial-In Numbers: Date: Thursday, November 14, 2024 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: 13749798

Replay Dial-In Numbers: Toll Free: 1-844-512-2921 Toll/International: 1-412-317-6671 Replay Start: Thursday, November 14, 2024, 7:15 p.m. ET Replay Expiry: Saturday, December 14, 2024, at 11:59 PM ET Replay Pin Number: 13749798

About ReposiTrak:

ReposiTrak (NYSE: TRAK) provides retailers, suppliers, food manufacturers and wholesalers with a robust solution suite to help reduce risk and remain in compliance with regulatory requirements, enhance operational controls and increase sales with unrivaled brand protection. Consisting of three product families – food traceability, compliance and risk management and supply chain solutions – ReposiTrak’s integrated, cloud-based applications are supported by an unparalleled team of experts. For more information, please visit https://repositrak.com.

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 ReposiTrak Inc. (“ReposiTrak”) are intended to identify such forward-looking statements. ReposiTrak 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 ReposiTrak 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.

 

REPOSITRAK, INC.

Consolidated Condensed Balance Sheets (Unaudited)

 

 

 

September 30,

 

June 30,

 

 

2024

 

2024

Assets

 

 

 

 

 

 

Current Assets

 

 

 

 

 

 

Cash

 

$

25,790,206

 

 

$

25,153,862

 

Receivables, net of allowance for doubtful accounts of $215,480 and $227,573 at September 30, 2024 and June 30, 2024, respectively

 

 

3,297,932

 

 

 

3,678,627

 

Contract asset – unbilled current portion

 

 

671,763

 

 

 

181,680

 

Prepaid expense and other current assets

 

 

332,018

 

 

 

285,998

 

Total Current Assets

 

 

30,091,919

 

 

 

29,300,167

 

 

 

 

 

 

 

 

Property and equipment, net

 

 

675,721

 

 

 

513,277

 

 

 

 

 

 

 

 

Other Assets:

 

 

 

 

 

 

Deposits and other assets

 

 

22,414

 

 

 

22,414

 

Prepaid expense – less current portion

 

 

2,218

 

 

 

2,609

 

Contract asset – unbilled long-term portion

 

 

-

 

 

 

108,052

 

Operating lease – right-of-use asset

 

 

234,729

 

 

 

250,306

 

Customer relationships

 

 

98,550

 

 

 

131,400

 

Goodwill

 

 

20,883,886

 

 

 

20,883,886

 

Capitalized software costs, net

 

 

320,518

 

 

 

384,621

 

Total Other Assets

 

 

21,562,315

 

 

 

21,783,288

 

 

 

 

 

 

 

 

Total Assets

 

$

52,329,955

 

 

$

51,596,732

 

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Accounts payable

 

$

331,755

 

 

$

265,086

 

Accrued liabilities

 

 

1,286,725

 

 

 

1,554,775

 

Contract liability – deferred revenue

 

 

2,585,019

 

 

 

2,441,234

 

Operating lease liability – current

 

 

65,452

 

 

 

64,076

 

Notes payable and financing leases – current

 

 

188,425

 

 

 

217,971

 

Total current liabilities

 

 

4,457,376

 

 

 

4,543,142

 

 

 

 

 

 

 

 

Long-term liabilities

 

 

 

 

 

 

Operating lease liability – less current portion

 

 

182,085

 

 

 

198,972

 

Notes payable and financing leases – less current portion

 

 

165,735

 

 

 

-

 

Total liabilities

 

 

4,805,196

 

 

 

4,742,114

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

Preferred Stock; $0.01 par value, 30,000,000 shares authorized;

 

 

 

 

 

 

Series B Preferred, 700,000 shares authorized; 546,377 and 616,470 shares issued and outstanding at September 30, 2024 and June 30, 2024, respectively

 

 

5,464

 

 

 

6,165

 

Common Stock, $0.01 par value, 50,000,000 shares authorized; 18,246,090 and 18,234,893 and issued and outstanding at September 30, 2024 and June 30, 2024, respectively

 

 

182,463

 

 

 

182,351

 

Additional paid-in capital

 

 

64,085,398

 

 

 

64,655,902

 

Accumulated other comprehensive loss

 

 

6,696

 

 

 

(27,390

)

Accumulated deficit

 

 

(16,755,262

)

 

 

(17,962,410

)

Total stockholders’ equity

 

 

47,524,759

 

 

 

46,854,618

 

Total liabilities and stockholders’ equity

 

$

52,329,955

 

 

$

51,596,732

 

 

REPOSITRAK, INC.

Consolidated Condensed Statements of Operations and Comprehensive Income (Unaudited)

 

 

 

Three Months Ended

 

 

September 30,

 

 

2024

 

2023

 

 

 

 

 

 

 

Revenue

 

$

5,441,142

 

 

$

5,060,112

 

 

 

 

 

 

 

 

Operating expense:

 

 

 

 

 

 

Cost of revenue and product support

 

 

859,219

 

 

 

766,334

 

Sales and marketing

 

 

1,529,100

 

 

 

1,505,501

 

General and administrative

 

 

1,292,551

 

 

 

1,279,323

 

Depreciation and amortization

 

 

280,211

 

 

 

308,945

 

Total operating expense

 

 

3,961,081

 

 

 

3,860,103

 

 

 

 

 

 

 

 

Income from operations

 

 

1,480,061

 

 

 

1,200,009

 

 

 

 

 

 

 

 

Other income (expense):

 

 

 

 

 

 

Interest income

 

 

349,533

 

 

 

258,161

 

Interest expense

 

 

(10,172

)

 

 

(6,344

)

Unrealized gain (loss) on short term investments

 

 

(4,267

)

 

 

27,186

 

Income before income taxes

 

 

1,815,155

 

 

 

1,479,012

 

 

 

 

 

 

 

 

(Provision) for income taxes:

 

 

(150,000

)

 

 

(100,464

)

Net income

 

 

1,665,155

 

 

 

1,378,548

 

 

 

 

 

 

 

 

Dividends on preferred stock

 

 

(107,882

)

 

 

(146,611

)

 

 

 

 

 

 

 

Net income applicable to common shareholders

 

$

1,557,273

 

 

$

1,231,937

 

 

 

 

 

 

 

 

Weighted average shares, basic

 

 

18,244,000

 

 

 

18,225,000

 

Weighted average shares, diluted

 

 

19,102,000

 

 

 

18,839,000

 

Basic income per share

 

$

0.09

 

 

$

0.07

 

Diluted income per share

 

$

0.08

 

 

$

0.07

 

Comprehensive income:

 

 

 

 

 

 

Net income

 

$

1,665,155

 

 

$

1,378,548

 

Other comprehensive gain (loss):

 

 

 

 

 

 

Unrealized gain (loss) on available-for-sale securities

 

 

34,086

 

 

 

-

 

Total comprehensive income

 

$

1,699,241

 

 

$

1,378,548

 

 

REPOSITRAK, INC.

Consolidated Condensed Statements of Cash Flows (Unaudited)

 

 

 

Three Months Ended

 

 

September 30,

 

 

2024

 

2023

Cash flows from operating activities:

 

 

 

 

 

 

Net income

 

$

1,665,155

 

 

$

1,378,548

 

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

 

 

 

 

 

 

Depreciation and amortization

 

 

280,211

 

 

 

308,945

 

Amortization of operating right of use asset

 

 

15,577

 

 

 

14,829

 

Stock compensation expense

 

 

150,000

 

 

 

85,375

 

Bad debt expense

 

 

100,044

 

 

 

75,000

 

(Increase) decrease in:

 

 

 

 

 

 

Accounts receivables

 

 

(259,388

)

 

 

(547,809

)

Long-term receivables, prepaids and other assets

 

 

6,455

 

 

 

216,340

 

Increase (decrease) in:

 

 

 

 

 

 

Accounts payable

 

 

66,669

 

 

 

(116,499

)

Operating lease liability

 

 

(15,511

)

 

 

(57,164

)

Accrued liabilities

 

 

(284,097

)

 

 

(14,218

)

Deferred revenue

 

 

143,785

 

 

 

177,423

 

Net cash provided by operating activities

 

 

1,868,900

 

 

 

1,520,770

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

Sale of marketable securities

 

 

34,086

 

 

 

-

 

Net cash provided by investing activities

 

 

34,086

 

 

 

-

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

Common Stock buyback/retirement

 

 

-

 

 

 

(1,322,082

)

Redemption of Series B Preferred

 

 

(749,995

)

 

 

-

 

Proceeds from employee stock plan

 

 

59,852

 

 

 

57,743

 

Dividends paid

 

 

(422,954

)

 

 

(421,248

)

Payments on notes payable and capital leases

 

 

(153,545

)

 

 

(128,834

)

Net cash used in financing activities

 

 

(1,266,642

)

 

 

(1,814,421

)

 

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

 

636,344

 

 

 

(293,651

)

 

 

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

 

25,153,862

 

 

 

23,990,879

 

Cash and cash equivalents at end of period

 

$

25,790,206

 

 

$

23,697,228

 

 

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

 

Cash paid for income taxes

 

$

312,098

 

 

$

221,661

 

Cash paid for interest

 

$

2,005

 

 

$

2,329

 

Cash paid for operating leases

 

$

18,686

 

 

$

18,141

 

 

 

 

 

 

 

 

Supplemental disclosure of non-cash investing and financing activities:

 

 

 

 

 

 

Common stock to pay accrued liabilities

 

$

69,985

 

 

$

37,500

 

Dividends accrued on preferred stock

 

$

107,882

 

 

$

146,611

 

Right-of-use asset

 

$

289,734

 

 

$

-

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20241114917941/en/

Investor Relations Contact:

John Merrill, CFO Investor-relations@repositrak.com

Or

FNK IR Rob Fink 646.809.4048 rob@fnkir.com