Exhibit 99.1
  
 
 
 
FOR IMMEDIATE RELEASE May 10, 2019
 
Peter Poli
 
Chief Financial Officer 877-260-2010
peter.poli@trackgrp.com
 
Track Group Reports 2nd Quarter Fiscal 2019 Financial Results
 
Revenue Up 11%, Operating loss improves 61%, and Adjusted EBITDA Up 28%
 
NAPERVILLE, ILLINOIS – Track Group, Inc. (OTCQX: TRCK), a global leader in offender tracking and monitoring services, today announced financial results for its second quarter ended March 31, 2019 (the “Q2 FY19”). In Q2 FY19, the Company posted (i) revenue of $8.1M, an increase of 11% over the same period last year, (ii) an operating loss of $0.3M compared to an operating loss of $0.7M for the quarter ended March 31, 2018 (“Q2 FY18”), (iii) adjusted EBITDA of $1.6M, up 28% compared to Q2 FY18, and (iv) a cash balance at March 31, 2019 of $5.7M, representing an increase of 4% over September 30, 2018 and down 3% compared to December 31, 2018.
 
“Track Group’s first half of Fiscal 2019 produced records in revenue, gross profit, Adjusted EBITDA and active devices,” said Derek Cassell, Track Group’s CEO. “Our hard work and focus on customer service are paying off and paving the way for a record year come September 30, 2019.”
  
FINANCIAL HIGHLIGHTS
 
Quarterly revenue of $8.1M in Q2 FY19, up 11% over Q2 FY18 of $7.3M. Revenue for the 6 months ended March 31, 2019 (“6M FY19”) of $16.3M was up approximately 10% compared to revenue of $14.8M for the 6 months ended March 31, 2018 (“6M FY18”).
 
Quarterly gross profit of $4.5M in Q2 FY19, up 12% over Q2 FY18 of $4.0M. Gross Profit for 6M FY19 was $9.1 million, up 7% compared to Gross Profit of $8.5 million for 6M FY18.
 
Total operating expense for Q2 FY19 of $4.77M is up nominally versus Q2 FY18’s $4.74M of operating expenses. The small jump in quarterly operating expense when combined with Q2 FY19 gross profit of $4.5M led to a quarterly loss of only $276K, which is an improvement of 61% compared to $716K operating loss for Q2 FY18. For 6M FY19, the loss from operations was $333K compared to loss from operations of $1.041M for 6M FY18, representing an improvement of approximately 68%.
 
Adjusted EBITDA in the Q2 FY19 finished at $1.6M, up 28% compared to $1.3M for Q2 FY18. Adjusted EBITDA for 6M FY19 of $3.3M, up approximately 18% vs $2.8M for 6M FY18.
  
 
5thAvenue Station                           877.260.2010
200 E. 5th Avenue,Suite 100           trackgrp.com 
Naperville, IL 60563
 
 
 
 
 
Cash balance of $5.7M for Q2 FY19, up 113% compared to $2.7M for Q2 FY18 and down 3% over the December 31, 2018 cash balance of $5.9M.
 
Net loss attributable to shareholders in the Q2 FY19 was $0.3M compared to a net loss of $1.7M in Q2 FY18, an improvement of approximately 85%. The net loss attributable to shareholders for the 6M FY19 was $2.0 million compared to a net loss of $2.8 million in 6M FY18 representing an improvement of approximately 28%.
 
BUSINESS OUTLOOK
  
 
Actual
Outlook
 
FY 2017
FY 2018
FY 2019
 
 
 
 
Revenue:
$29.7M
$30.6M
$33-37M
 
 
 
 
Adjusted EBITDA Margin:
12.2%
19.2%
18-23%
 
About Track Group, Inc.
 
Track Group designs, manufactures, and markets location tracking devices; as well as develops and sells a variety of related software, services, accessories, networking solutions, and monitoring applications. The Company's products and services are designed to empower professionals in security, law enforcement, corrections and rehabilitation organizations worldwide with single-sourced offender management solutions that integrate reliable intervention technologies to support re-socialization and monitoring initiatives.
 
The company currently trades under the ticker symbol "TRCK" on the OTCQX exchange. For more information, visit www.trackgrp.com.
 
 
Forward-Looking Statements
 
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 Track Group, Inc. and subsidiaries ("Track Group") are intended to identify such forward-looking statements. These statements are only predictions and reflect Track Group's current beliefs and expectations with respect to future events and are based on assumptions and subject to risks and uncertainties and subject to change at any time. Track 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 Track Group'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. New risks emerge from time to time. 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.
 
 
 
  
Non-GAAP Financial Measures
 
This release includes financial measures defined as “non-GAAP financial measures” by the Securities and Exchange Commission including non-GAAP EBITDA. 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 are based on the financial figures for the respective period.
 
Non-GAAP Adjusted EBITDA excludes items included but not limited to interest, taxes, depreciation, amortization, impairment charges, gains and losses, currency effects, one time charges or benefits that are not indicative of operations, charges to consolidate, integrate or consider recently acquired businesses, costs of closing facilities, stock based or other non-cash compensation or other stated cash and non-cash charges (the “Adjustments”).
 
The Company believes the non-GAAP measures provide useful information to both management and investors when factoring in the Adjustments. Specific disclosure regarding the Company’s financial results, including management’s analysis of results from operations and financial condition, are contained in the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2018, and other reports filed with the Securities and Exchange Commission. Investors are encouraged to carefully read and consider such disclosure and analysis contained in the Company’s Form 10-K and other reports, including the risk factors contained in such Form 10-K.
 
 
 
 

 
 
TRACK GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
 

 
March 31,
2019
(unaudited)
 
 
 
September 30,
2018
 
Assets
 
 
 
 
 
 
Current assets:
 
 
 
 
 
 
Cash
 $5,665,109 
 $5,446,557 
Accounts receivable, net of allowance for doubtful accounts of $3,345,012 and $3,152,966, respectively
  5,937,747 
  5,978,896 
Note receivable, net of allowance for doubtful accounts of $234,733, respectively
  - 
  - 
Prepaid expense and other
  1,498,775 
  1,270,043 
Inventory, net of reserves of $26,934, respectively
  86,814 
  277,119 
Total current assets
  13,188,445 
  12,972,615 
Property and equipment, net of accumulated depreciation of $2,140,734 and $1,999,222, respectively
  783,871 
  745,475 
Monitoring equipment, net of accumulated amortization of $6,159,826 and $5,325,654, respectively
  2,986,212 
  3,162,542 
Intangible assets, net of accumulated amortization of $13,031,721 and $12,016,512, respectively
  22,406,455 
  23,253,054 
Goodwill
  8,033,631 
  8,076,759 
Other assets
  124,453 
  145,839 
Total assets
 $47,523,067 
 $48,356,284 
 
    
    
Liabilities and Stockholders’ Equity (Deficit)
    
    
Current liabilities:
    
    
Accounts payable
 $2,385,082 
 $2,518,030 
Accrued liabilities
  11,797,155 
  10,333,103 
Current portion of long-term debt
  37,810 
  30,437,810 
Total current liabilities
  14,220,047 
  43,288,943 
Long-term debt, net of current portion
  33,808,193 
  3,428,975 
Total liabilities
  48,028,240 
  46,717,918 
 
    
    
   Commitments and contingencies
  - 
  - 
 
    
    
Stockholders’ equity (deficit):
    
    
Common stock, $0.0001 par value: 30,000,000 shares authorized;11,401,650 shares outstanding, respectively
  1,140 
  1,140 
Series A Convertible Preferred stock, $0.0001 par value: 1,200,000 shares authorized; 0 shares outstanding
    
  - 
Paid in capital
  302,211,181 
  302,102,866 
Accumulated deficit
  (301,587,916)
  (299,495,370)
Accumulated other comprehensive loss
  (1,129,578)
  (970,270)
Total equity (deficit)
  (505,173)
  1,638,366 
Total liabilities and stockholders’ equity (deficit)
 $47,523,067 
 $48,356,284 
 
 
 
 
 
 
TRACK GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited)
 
 
 
Three Months Ended
 
 
Six Months Ended
 
 
 
March 31,
 
 
March 31,
 
 
March 31,
 
 
March 31,
 
 
 
2019
 
 
2018
 
 
2019
 
 
2018
 
Revenue:
 
 
 
 
 
 
 
 
 
 
 
 
Monitoring and other related services
 $7,877,403 
 $7,162,205 
 $15,937,731 
 $14,513,010 
Product sales and other
  213,839 
  153,971 
  365,046 
  293,860 
Total revenue
  8,091,242 
  7,316,176 
  16,302,777 
  14,806,870 
 
    
    
    
    
Cost of revenue:
    
    
    
    
Monitoring, products and other related services
  3,065,710 
  2,827,842 
  6,165,903 
  5,369,849 
Depreciation and amortization included in cost of revenue
  533,590 
  467,666 
  1,011,879 
  944,808 
Total cost of revenue
  3,599,300 
  3,295,508 
  7,177,782 
  6,314,657 
 
    
    
    
    
 Gross profit
  4,491,942 
  4,020,668 
  9,124,995 
  8,492,213 
 
    
    
    
    
 Operating expense:
    
    
    
    
General & administrative
  3,316,069 
  3,495,343 
  6,738,341 
  7,153,081 
Selling & marketing
  576,974 
  518,993 
  1,080,904 
  928,730 
Research & development
  354,879 
  182,808 
  603,744 
  346,754 
Depreciation & amortization
  520,384 
  539,537 
  1,035,365 
  1,104,277 
Total operating expense
  4,768,306 
  4,736,681 
  9,458,354 
  9,532,842 
 
    
    
    
    
Loss from operations
  (276,364)
  (716,013)
  (333,359)
  (1,040,629)
 
    
    
    
    
Other income (expense):
    
    
    
    
Interest expense, net
  (584,348)
  (805,966)
  (1,185,587)
  (1,479,793)
Currency exchange rate gain (loss)
  595,910 
  (221,048)
  (336,767)
  (276,120)
Other income, net
  143 
  6,542 
  143 
  17,466 
Total other income (expense)
  11,705 
  (1,020,472)
  (1,522,211)
  (1,738,447)
Loss before income taxes
  (264,659)
  (1,736,485)
  (1,855,570)
  (2,779,076)
Income tax expense
  - 
  - 
  144,007 
  - 
Net loss attributable to common shareholders
  (264,659)
  (1,736,485)
  (1,999,577)
  (2,779,076)
Foreign currency translation adjustments
  (255,981)
  241,726 
  (159,308)
  430,451 
Comprehensive loss
 $(520,640)
 $(1,494,759)
 $(2,158,885)
 $(2,348,625)
Net loss per common share, basic and diluted
 $(0.02)
 $(0.17)
 $(0.18)
 $(0.27)
Weighted average common shares outstanding, basic and diluted
  11,251,650 
  10,462,433 
  11,175,002 
  10,469,466 
 
 
 
 
 
 
 
 
Three Months Ended
March 31,
 
 
Six Months Ended
March 31,
 
 
 
2019
 
 
2018
 
 
2019
 
 
2018
 
Non-GAAP Adjusted EBITDA
 
 
 
 
 
 
 
 
 
 
 
 
Net loss attributable to common shareholders
 $(265)
 $(1,736)
 $(2,000)
 $(2,779)
Interest expense, net
  585 
  806 
  1,186 
  1,480 
Depreciation and amortization
  1,054 
  1,008 
  2,047 
  2,050 
Income taxes (1)
  - 
  - 
  144 
  - 
Board compensation and stock-based compensation
  100 
  557 
  258 
  1,345 
Foreign exchange expense
  (596)
  55 
  337 
  275 
Other charges, net (2)
  740 
  571 
  1,364 
  457 
Non GAAP Adjusted EBITDA
 $1,618 
 $1,261
 
 $3,336 
 $2,828 
Non GAAP Adjusted EBITDA, percent of revenue
  20.0%
  17.2%
  20.5%
  19.1%
 
 
 
Three Months Ended
March 31,
 
 
Six Months Ended
March 31,
 
 
 
  2019 
 
 
2018 
 
 
2019
 
 
2018
 
Non-GAAP EPS (in $000’s, except share data)
 
 
 
 
 
 
 
 
 
 
 
 
Net loss attributable to common shareholders
 $(265)
 $(1,736)
 $(2,000)
 $(2,779)
Interest expense, net
  585 
  806 
  1,186 
  1,480 
Depreciation and amortization
  1,054 
  1,008 
  2,047 
  2,050 
Income taxes (1)
  - 
  - 
  144 
  - 
Board compensation and stock-based compensation
  100 
  557 
  258 
  1,345 
Foreign exchange expense
  (596)
  55 
  337 
  275 
Other charges, net (2)
  740 
  571 
  1,364 
  457 
Non GAAP net income to common shareholders
 $1,618 
 $1,261 
 $3,336 
 $2,828 
Weighted average common shares outstanding
  11,251,650 
  10,462,433 
  11,175,002 
  10,469,466 
Non-GAAP earnings per share
 $0.14 
 $0.12 
 $0.30 
 $0.27 
 
(1)
Currently, the Company has significant U.S. tax loss carryforwards that may be used to offset future taxable income, subject to IRS limitations. However, the Company is still subject to certain state, commonwealth, and other foreign based taxes.
 
(2)
Other charges may include gains or losses and non-recurring accrual adjustments.
 
 
 
 
 
 
 

The following information was filed by Track Group, Inc. (TRCK) on Friday, May 10, 2019 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

View differences made from one quarter to another to evaluate Track Group, Inc.'s financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 10-Q Quarterly Report to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Track Group, Inc..

Continue

Never Miss A New SEC Filing Again


Real-Time SEC Filing Notifications
Screenshot taken from Gmail for a new 10-K Annual Report
Last10K.com Member Feature

Receive an e-mail as soon as a company files an Annual Report, Quarterly Report or has new 8-K corporate news.

Continue

We Highlighted This SEC Filing For You


SEC Filing Sentiment Analysis - Bullish, Bearish, Neutral
Screenshot taken from Wynn's 2018 10-K Annual Report
Last10K.com Member Feature

Read positive and negative remarks made by management in their entirety without having to find them in a 10-K/Q.

Continue

Widen Your SEC Filing Reading Experience


Increased Reading Area for SEC Filings
Screenshot taken from Adobe Inc.'s 10-Q Quarterly Report
Last10K.com Member Feature

Remove data columns and navigations in order to see much more filing content and tables in one view

Continue

Uncover Actionable Information Inside SEC Filings


SEC Filing Disclosures
Screenshot taken from Lumber Liquidators 10-K Annual Report
Last10K.com Member Feature

Read both hidden opportunities and early signs of potential problems without having to find them in a 10-K/Q

Continue

Adobe PDF, Microsoft Word and Excel Downloads


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshots of actual 10-K and 10-Q SEC Filings in PDF, Word and Excel formats
Last10K.com Member Feature

Export Annual and Quarterly Reports to Adobe PDF, Microsoft Word and Excel for offline viewing, annotations and analysis

Continue

FREE Financial Statements


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshot of actual balance sheet from company 10-K Annual Report
Last10K.com Member Feature

Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports

Continue for FREE

Intrinsic Value Calculator


Intrinsic Value Calculator
Screenshot of intrinsic value for AT&T (2019)
Last10K.com Member Feature

Our Intrinsic Value calculator estimates what an entire company is worth using up to 10 years of financial ratios to determine if a stock is overvalued or not

Continue

Financial Stability Report


Financial Stability Report
Screenshot of financial stability report for Coco-Cola (2019)
Last10K.com Member Feature

Our Financial Stability reports uses up to 10 years of financial ratios to determine the health of a company's EPS, Dividends, Book Value, Return on Equity, Current Ratio and Debt-to-Equity

Continue

Get a Better Picture of a Company's Performance


Financial Ratios
Available Financial Ratios
Last10K.com Member Feature

See how over 70 Growth, Profitability and Financial Ratios perform over 10 Years

Continue

Log in with your credentials

or    

Forgot your details?

Create Account