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Track Group, Inc. (TRCK) SEC Filing 10-Q Quarterly Report for the period ending Friday, December 31, 2021

Track Group, Inc.

CIK: 1045942 Ticker: TRCK

 

Exhibit 99.1

 

Track Group Reports 1st Quarter Fiscal 2022 Financial Results

Total Revenue up 2%, Operating Income Declines 58% and Net Income Reversal

 

NAPERVILLE, ILLINOIS – Track Group, Inc. (OTCQX: TRCK), a global leader in offender tracking and monitoring services, today announced financial results for its fiscal quarter ended December 31, 2021 (“Q1 FY22”). In Q1 FY22, the Company posted (i) total revenue of $9.6M, an increase of approximately 2% over total revenue of $9.4M for the quarter ended December 31, 2020 (“Q1 FY21”); (ii) Q1 FY22 operating income of $0.6M, representing a decline of 58% compared to Q1 FY21 operating income of $1.4M, and (iii) a net loss attributable to common shareholders of $0.3M in Q1 FY22 compared to net income attributable to common shareholders of $1.3M in Q1 FY21.

 

“The conditions under which we operate today remain challenging as we adjust to supply chain constraints and the telecommunication carrier’s transition from 3G to 5G, despite setbacks created for a number of industries. As a result, our financial results for the first quarter ended December 31, 2021, were adversely impacted. Notwithstanding, we will continue to adapt to these challenges, add new products, and customers, who remain in need of and are confident in our ability to innovate solutions,” said Derek Cassell, Track Group’s CEO.

 

FINANCIAL HIGHLIGHTS

 

 

Total revenue of $9.6M for Q1 FY22, up 2% compared to Q1 FY21 revenue of $9.4M.

 

 

Gross profit of $4.8M in the Q1 FY22, down approximately 8% compared to gross profit of $5.2M for Q1 FY21, due to increases in certain costs of revenue, including, the amortization expense for the new software platform.

 

 

Operating income in Q1 FY22 of $0.6M, down approximately 58% compared to operating income of $1.4M for Q1 FY21, due to the higher cost of revenue and the increase in certain operating expenses.

 

 

Adjusted EBITDA for Q1 FY22 of $2.2M, down 17% compared to adjusted EBITDA of $2.7M for Q1 FY21. Adjusted EBITDA in Q1 FY22 as a percentage of revenue also decreased to 22.9%, compared to 28.2% for Q1 FY21. The reduction in adjusted EBITDA is due to the decline in operating income offset by the increase in total depreciation and amortization.

 

 

Cash balance for Q1 FY22 of $8.6M, up 47% compared to a cash balance of $5.9M for Q1 FY21, and up 2% compared to a cash balance of $8.4M for the quarter ended September 30, 2021.

 

 

Net loss attributable to shareholders for the Q1 FY22 was ($0.3M), compared to net income attributable to shareholders of $1.3M in Q1 FY21, a change principally attributable to the decline in the Company’s operating income and a swing from a currency exchange gain to a loss.

 

Business Outlook

The extent to which supply chain delays, the Coronavirus, and the telecommunications 5G transition impact our future operations will depend on numerous factors that we cannot accurately predict, although we anticipate that it will be difficult to match our results for the fiscal year ended September 2021 ("FY21") in the upcoming year ending September 30, 2022 ("FY22"). Despite these short-term challenges faced by companies worldwide, Track Group remains confident that our continued focus on strategic adaptation, which evidenced success in FY21, will allow us to be well-positioned for a return to growth in FY23.

 

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.

 

 

-1-

The following information was filed by Track Group, Inc. (TRCK) on Thursday, February 10, 2022 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.

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Inside this 10-Q Quarterly Report

Document And Entity Information
Condensed Consolidated Balance Sheets (Current Period Unaudited)
Condensed Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals)
Condensed Consolidated Statement Of Changes In Stockholders' Equity (Deficit) (Unaudited)
Condensed Consolidated Statements Of Cash Flows (Unaudited)
Condensed Consolidated Statements Of Operations And Comprehensive Income (Loss) (Unaudited)
Note 1 - Basis Of Presentation
Note 1 - Basis Of Presentation (Details Textual)
Note 10 - Inventory
Note 10 - Inventory (Details Textual)
Note 10 - Inventory (Tables)
Note 10 - Inventory - Summary Of Inventory (Details)
Note 11 - Property And Equipment
Note 11 - Property And Equipment (Details Textual)
Note 11 - Property And Equipment (Tables)
Note 11 - Property And Equipment - Property And Equipment (Details)
Note 12 - Monitoring Equipment
Note 12 - Monitoring Equipment (Details Textual)
Note 12 - Monitoring Equipment (Tables)
Note 12 - Monitoring Equipment - Schedule Of Monitoring Equipment (Details)
Note 13 - Intangible Assets
Note 13 - Intangible Assets (Details Textual)
Note 13 - Intangible Assets (Tables)
Note 13 - Intangible Assets - Intangible Asset Activity (Details)
Note 14 - Goodwill
Note 14 - Goodwill (Details Textual)
Note 14 - Goodwill (Tables)
Note 14 - Goodwill - Schedule Of Goodwill (Details)
Note 15 - Other Assets
Note 15 - Other Assets (Details Textual)
Note 16 - Leases
Note 16 - Leases (Details Textual)
Note 16 - Leases (Tables)
Note 16 - Leases - Schedule Of Cash Flow Information (Details)
Note 16 - Leases - Schedule Of Future Minimum Lease Payments (Details)
Note 16 - Leases - Schedule Of Right Of Use Assets And Lease Liabilities (Details)
Note 17 - Accrued Liabilities
Note 17 - Accrued Liabilities (Tables)
Note 17 - Accrued Liabilities - Schedule Of Accrued Liabilities (Details)
Note 18 - Related Parties
Note 18 - Related Parties (Details Textual)
Note 19 - Debt Obligations
Note 19 - Debt Obligations (Details Textual)
Note 19 - Debt Obligations (Tables)
Note 19 - Debt Obligations - Future Maturities Of Debt Obligations (Details)
Note 19 - Debt Obligations - Summary Of Debt Obligations (Details)
Note 19 - Debt Obligations - Summary Of Debt Obligations (Details) (Parentheticals)
Note 2 - Principles Of Consolidation
Note 20 - Preferred And Common Stock
Note 20 - Preferred And Common Stock (Details Textual)
Note 21 - Stock Options And Warrants
Note 21 - Stock Options And Warrants (Details Textual)
Note 21 - Stock Options And Warrants (Tables)
Note 21 - Stock Options And Warrants - Summary Of Stock Options And Warrants Activity (Details)
Note 22 - Income Taxes
Note 22 - Income Taxes (Details Textual)
Note 23 - Commitments And Contingencies
Note 23 - Commitments And Contingencies (Details Textual)
Note 23 - Commitments And Contingencies (Tables)
Note 23 - Commitments And Contingencies - Operating Lease Revenue Associated With Monitoring Equipment (Details)
Note 24 - Subsequent Events
Note 24 - Subsequent Events (Details Textual)
Note 3 - Recent Accounting Standards
Note 4 - Impairment Of Long-Lived Assets
Note 5 - Business Combinations
Note 6 - Accumulated Other Comprehensive Income (Loss)
Note 7 - Net Income (Loss) Per Common Share
Note 7 - Net Income (Loss) Per Common Share (Details Textual)
Note 7 - Net Income (Loss) Per Common Share (Tables)
Note 7 - Net Income (Loss) Per Common Share - Schedule Of Common Stock Equivalents (Details)
Note 8 - Revenue Recognition
Note 8 - Revenue Recognition (Details Textual)
Note 8 - Revenue Recognition (Tables)
Note 8 - Revenue Recognition - Disaggregation Of Revenue (Details)
Note 9 - Prepaid Expense And Deposits
Note 9 - Prepaid Expense And Deposits (Details Textual)
Ticker: TRCK
CIK: 1045942
Form Type: 10-Q Quarterly Report
Accession Number: 0001851734-22-000072
Submitted to the SEC: Wed Feb 09 2022 8:52:58 PM EST
Accepted by the SEC: Thu Feb 10 2022
Period: Friday, December 31, 2021
Industry: Communications Equipment

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