TRAK - Earnings call transcript Q4 2024

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Operator

Greetings, and welcome to the ReposiTrak Fiscal Fourth Quarter 2024 Earnings Call. [Operator Instructions] As a reminder, this call is being recorded.

I would now like to turn the call over to Rob Fink with FNK IR. Mr. Fink, you may begin.

Rob Fink

good and operator, you, afternoon, everyone. Thank for Fourth Quarter you joining us Fiscal ReposiTrak the for Earnings today Thank Call. Hosting the and CFO. CEO; ReposiTrak's Chairman call today are John Randy Merrill, Fields, and ReposiTrak's

this like within ReposiTrak meaning XXXX. of Litigation remind would statements Securities the I Private Act begin, contain forward-looking we everyone Before that Reform call the could about to of

expectations. Such based upon are statements statements are statements that Forward-looking beliefs are and forward-looking not historical facts. current

Such risks ReposiTrak today, The subject materially. results results issued risks the can to may company's uncertainties, the information and to information of herein release should SEC. press company's actual fully overviewing remarks will be the light that which are visit filings does press section ReposiTrak the contained considered today's update any are this to not risks. market website forth the company obligation the in discussed call. in in a differ call. financial with conference such discussed Shortly assume be release. repositrak.com of set on after Relations Investors this Investor closed access the

that now like to John. John, turn All the call said, yours. call over is the I'd to

John Merrill

everyone. ReposiTrak. again This good milestone year a for Thanks, and Rob, afternoon, was

invested sales, the million cybersecurity As dividend over expanded development history. income further shares. more returned traceability even the shares in the to our margins, faster. our accelerate now At increased preferred cash sheet, and resources we revenue, We the capital time, $X.X stock to grew in anticipated, platform company's At we common common and shareholders marketing, to delivered cash highest we solid time, the implementation added redemption growing and recurring buyback solution. same bolster net our EPS in our and of through retirement balance a our and same of heavily

doing significant we to it, are the leader an position. and tailwinds traceability, We XXXX enviable in be about talking have and it. competitive continue will entered with not fiscal just I believe

fiscal our to of to popular year-over-year or continues but moving X% profitable and more derived traceability our run high low traceability and margins delivered, million the will XX-plus comparative from I which last believe of solutions. but as growth resources served million. next touch I revenue the our suite flow, percent more drag solution revenue, to comparisons rate at traceability opportunity, revenue X share opportunity eliminated are annual the We recurring earnings historically us a accelerate. we just XXXX, cash of In was better operating believe years us before. a herd of capitalize making per period revenue $X.X have as on on the over not yielding proper, higher the will decision as traceability than double have actual revenue decision and not the The free continue our up necessary, XX permit accelerate, even to logical just or appeared ever $X.X culling total on for may represented of to months. we entire

$X.X million. X% I numbers are results higher fiscal profitability follows: ARR, right themselves, the versus we revenue speak as Generating million as levels Total of quarter XXXX it. to quarter, scale. EPS was and Fourth for million expenses the let's get from so $X.X up Operating June net revenue $X.X believe for shareholders income $X.X income of million. versus million. $X.X net versus $X.X was increased XX% XX%, Recurring increased XXX% to GAAP increased in fiscal to $X.X $X.X million X%, essentially million XXXX. GAAP common million total revenue.

we redeemed of the just price share year. share $XX.XX and to compared $XXX,XXX. preferred stock per last under redemption per Earnings per share was shares for at XX,XXX $X.XX $X.XX

year fiscal full XXXX Turning the to numbers.

recurring net million. and and versus cybersecurity revenue campaigns. This GAAP and versus share income fiscal expenses During million X% investment to Traceability and with common and XXXX, $X.X or $X.XX X%, XX%, $X.XX Earnings of shareholders marketing last ReposiTrak X%, million. increased income investments both in share year, was $X.X was total awareness other $X focus increased $X.XX participation the Network to revenue. was increased basic more net RTN, in Operating XX% trade $X.X million compared is per diluted. GAAP basic and revenue per shows on sales reflecting total diluted. up in

price total year, $X.X million. We a fiscal the for shares preferred $X.X repurchased the XXX,XXX redeemed common million. of redemption we of a of During for roughly total $XX.XX for stated XXX,XXX shares

in to continue is our Stock $XX It increased no repurchased canceled. paid shares off years. reiterate line stock have if to it's or subsequently and or shareholders bank common common Again, fully matter X credit quarterly the remaining the our We doesn't no fiscal in we hold over debt. We and dividends goal in million the XXXX, paid treasury redeemed preferred. of stock. bank. preferred $X.X have common to million redeem the We in cash all and cash we dividend

financial net of revenue XXXX investments from net our bolster contribution performance of ongoing streams. sunsetting traceability, to revenue Again, and fiscal reflects X% noncore of our a position

and sequentially suppliers. forecast we difficult to increase collected the be or FDA enrollment deadline. as manually as to systems extracted routinely then of from supplier's the discovery help and the to need trajectory process have complex mandate expect to establish in the closer Data the X FDA We several identify the where in There's accurately. contribution the enrolling continue a move traceability for FDA files We suppliers that and requirements in requires period multistep fiscal of quarter-by-quarter requirements the accelerate written live and data what e-mails and to supplier. to a of is various explain remains It will acquired XXXX lives.

X not size complex. is all. It's It a fits

where that's in more color However, excel. Randy we commentary. add will his

enrollment process. the expenses part were you are the supply with network can more We to process, a I and It's the facilitate seeing. retailers chain and automate suppliers making faster compliance That line learning the efficient. offering. hubs educate to and and believe or more financial implemented maintain it continue are increased in their of the parent to and we once is enrolled requirements everywhere our

of with compliance touch, chain us. solid despite know I clear, lost traceability growth chain, problem. and a traceability. not about customers lot laser-focused supply opportunity talking time are we suite growth growth we revenue. same The a solutions Be of to entire of figures The elimination and simultaneously deliver on high opportunity also the we Compliance spent from have the management, on is discovery continued of cross-sell provide. the low supply

long-term our common of with increased revenue, and drive cash. customer chain very opportunity, care Take dividend remains manage strategy the grow summary, simple. offerings, supply continue In EPS, recurring buyback income increase costs more common and with traceability, the compliance net the and of stock, balancing opportunity, and preferred cost

and and stock in flow all balances. of $X.X cash buybacks, cash was redemption at June to $XX year XX, million now over returning a on at $XX.X common bank dividends. XXXX. Turning record to the after cash fiscal preferred million cash cash This end XXXX, capital shareholders debt was to year for stock Total off paying and even million compared us

buyback The has nearly from $X the authorization. million $XX of For million. remaining year, $X we fiscal operations company generated common the million on cash stock total

stated remaining years. earlier, As outstanding have per shares at repurchased redeeming about The the $XX.XX of next stock is of share. redemption redemption and the over a and XXX,XXX preferred X amount of the preferred $X.X we price we preferred I million, anticipate said stock all issued

shareholders take whichever in will a we operations before, said the additional the cash sense stock of at that have buying common form we dividend, the and preferred most annual makes of at from generated As it least the lever return dividend, increasing to back time. half or shares and

goes or to fund M&A, bank strategically time. in and and favorable at will half our evaluate other whichever to capital strategy is allocation used continues be may levers, otherwise. adjust The capital that different products The more shareholders the new the initiatives, lever to Board

seen cash you with increase December record dividend earnings in quarterly have our of starting yet the XX% shareholders the approved XX, common release As today, in stock again another may XXXX. Board on

all that's Randy. At to the over So for have this point, I time. everyone, Thanks, your call today. Randy? pass I'll

Randall Fields

was important ReposiTrak. for Fiscal evolution Thanks, XXXX really John. of year another

redemption preferred shares. returned common partial further we our with Here's the the time, and redeem paying strengthened our We out cash New Stock York We We business identity and sheet. to balance shareholders the already quarterly industry-leading $X.X shares preferred dividend, done. of a XXXX corporate to of year align same million during rebranded cash fortress at got fiscal Exchange. purchases, uplisted our dividends to just increased list We stock what we our more our common repurchased through platform. than

to obvious it. FDA's Safety We said faster. even as We revenues, traceability choice low increased the some and or call related ReposiTrak the certain [ opportunity revenue and EPS better signed we in X% Food industry wholesalers our opportunity Act, ] grew the lines resources an up that Network the At to we the to high RTN, suppliers ] endorsement, the income net same XXX. address Q establish We free while address to added solution traceability we're revenue leader of beginning journey It's amazing [ to traceability growth. our to as thought term on. delivering long the that thousands ReposiTrak still and major secured time, Rule the recurring touch, established Modernization space. is retailers

the of food our More stores, what we for will other out traceability for The in adoption Traceability in some is team the rolling our that obviously. And later, about exceed than The pace expectations larger we've proud accomplished. exceeding of market products size to beyond there's expectations. almost I'm in convenience expected. of extremely add-on many, way. ancillary XXXX. every verticals continues service, is be many opportunities and grocery, that amazing initially

we? facilities retail wholesale being our customers. and by have currently and roughly are where We actively X,XXX X,XXX that companies enrolled So are

deadline the Representing revenue months. of rate for XX is next us XX in The run about FDA to XXXX. $XX annual current million January recurring

more The for Importantly, competitive recent and spate what frankly, of about and reinforcing traceability more you've we a do. less safety a pull. is and less the push market and heard is that regulatory issues demand accelerating food becoming actually

fact, multiples we on But size This to suppliers, do of requiring In the total it's obviously all the market. retailers see. not are and some currently food increases traceability. clear, those wholesalers FDA what of be the large just list

would has welcome to we'd line. deadline time a in not But to time industry the date, the XXXX adjusted meet said, the January delay requirements. the we've provide As additional the FDA

establish mandates Nevertheless, traceability to appear than eager many FDA the retailers even more faster it.

For require means Knowing compliance, quickly have ahead retailers FDA we'll traceability. We dictated it and We're this, get doesn't for more drop again meet the risk requirements from with that obvious the prepared. that the FDA the is regulatory, for January fully suppliers, of their and are line us, or legal do in procrastinators. and to the own product. of retailer Retailers date. the XXX the current adjusted reason. seriously with really XXXX Keep mind a means owns that faster. its Rule it dead deadlines traceability taking financial associated

stories all them. actually pressure are to them. food from that Obviously, comply lawyers XXX, suppliers there's going about by get suppliers accepting retailer to customers stop Given are illnesses, the doing or the we're to Rule their unrelenting product covered seeing new either fire demand that or is part advising an

provided rata being John about $X.X are XX This the who've suppliers XXXX. to the built. pro our portion necessary now X% enrolled and revenue, fiscal XX about months, reflects only out, As implemented over in pointed the fully been last contribute data enrolled total and of that traceability the of million

As accelerating by driven quarter-to-quarter, now by lines the John sequentially hubs. our stated, and created rapidly we're enrollment

now. ask ramp the For who revenue answer those when is begin, will you of the

manage make how is our to and job them. it sure customers thrilled handle smooth Our are it, with that we

traceability Let me the little a bit. enrollment explain process

alluded traceability As a onboarding process. as complex John multistep to, suppliers

suppliers to FDA's hub those and have governed that impacted mandate. a those categories: one, two, into by X by broken there's or we phase the may the law; suppliers directly First, discovery indirectly identify be a not

of data the required every what the and no cetera, actual all traceability have data not reach Many identify lives. There's to enrollment information out. where, with of Next, suppliers it. at supplier, and the the and explain don't have work collection. over hub them help et requirements the standardization of out of to period that We they selected provide time, each simple required rolls the or least a

of an of and the collected is et be and the accurate data Some assist. need on written XX% particularly a is one more may fact staff out, and have routine basis. to files The IT technology systems even don't and e-mails It extracted be if than cetera. you files the department that suppliers supplier consider complex, to or

assist it we what platform. our We to set understand required, navigate up collect data is in and it that. We the supplier

advance begin at onboarding line to has from initial We a identifying connected, be in resulted Once billing. we vendors remember, continue which speed the revenue. suppliers. months, our time The XX year can to increasing the which platform, was if we can to monthly you

we've the hubs, reduce represents The today, now half. for to the likely the of recurring FDA is that that annualized that market us. time X,XXX revenue suppliers forces period can't implementation. number of trajectory even sheer pressure of contracted we enroll required to As to of in in their project more. The Again, cut automation are hubs by $XX full million adoption

wholesalers the retailers, way, increases and our hubs, significant very ARR. we of Why? quarter-by-quarter, as current to by call market we the others, attractive scale The will However, additional penetration them. is you in believe see

have already in in them their up most traceability easier. That traceability because of -- even the some Well, in network. job suppliers we of and ReposiTrak makes many cases, getting running

why Our retailers very, additional not but about talking everyone systems. pipeline and others an a have only That's that and will multiple we're suppliers onboarded. traceability type is we and the mind else likely of thousands current position. and add in doing have tout, it. competitive of wholesalers traceability enviable are say enrolled I'm suppliers very being to deep we to Keep is and

a really not it's game. So zero-sum

traceability are is our they supply focus primary chain traceability. and growing, our moment, at the businesses augment While also compliance

can our have compliance do both customers positioned well services with. our problems chain we still solutions, are that and of supply provide traceability assist to suite While

So summarize. let me

our our growth execution profitability to of could that rate. recurring ability won't speed have We moderate prioritizing great care take maximizing prefer increasing deliver will current allow growth enrollment the and continue We current The We to our our customers. customers. rate, for effect jeopardize revenue a will that. inevitable over of

so will be back better to cash stock, buy long continue confidence. our maintain the to still and and give execution. We more automate We can strategy we customers allocation continue increasing even faster to capital We'll our to at every flawless balances opportunity. dividend, common as deploy paying our preferred continue

that Hopefully, did how shareholders This an record today's seen voted optimistic with increase common Board the may stock you of of dividend another increase XX% as exciting XX%, next has just dividend of earnings I'm John in announce Finally, and all starting release, the have to in press again this, with the both in to and years. common November hear you we the XXXX. XXXX is December as confident can XX, from be IR. going few to proud

that, to for with call like now Operator? open questions. I'd So the

Operator

Forte [Operator Instructions] Maxim Our Group. with is question Thomas from first

Thomas Forte

the X anyone congrats So fantastic in X a first off, in year. on Randy, quarter if have advance John, and I'll Apologies else is a go time. questions. queue. and I at

adjusting finished is, effort? remove that The is your to Or you permanent customer ones? a have low-margin high-touch first X portfolio

Randall Fields

that is where yes. to answer from today, the Well, we are

of layer want think we fact, at influx we if, on have with. onion that that deal it's certain more to that's of traceability we say the is not because of However, stay. where XXX% our to But requirement part we'll another that, an be, where point, that's this there we in but can

Thomas Forte

quarters. health care, not expand [ on then discuss your Okay. care? tease But health I says [ future so thoughts to and efforts that give the part call, to restaurants, your current for so tease ], but don't you markets, willingness on regulated ] want teased then who restaurants [ adjacent this, in And you ] on can think your your to into

Randall Fields

opportunity do profitability it. both can and we the from the take at obvious. we get look a what that We Well, size market is

same products are us. certain a extent, the to more So profitable follow-on for to customers

year. So there from will follow-on today, exciting. available are extraordinarily be are some stand IT after new products the the that that of where -- first we That

question And so the to verticals. other continue push is we'll into

bringing prospective will and forward same that the to us of we traceability, that. sit time, customers. make products our extremely we on think are at And doing are top We these attractive

we're try not -- do your to So to answer both. is and the answer question going vague the

Thomas Forte

Okay. All your efforts next right. you -- And opportunity? updates is give can international and the question then on

Randall Fields

the U.S., for to what is, It unfortunately, be suppliers next of U.S. It's U.S. the platform opportunity think, to have have are we dominant imagine outside whatever are and doing becomes however, us. extremely part the that with we on we're I likely is is, too execution us that thousands greatest doing most likely sure the outside that that, that's years few the over Well, of the to so onboarded. today focused much business

form more outside rather much to than our own personnel. Our our is approach, however, the U.S. likely execution ventures the with in be of

Thomas Forte

Okay. on onetime All the the other capital the ever And Would then regular is dividend dividend? I wanted things dividend increase to were for fantastic. allocation, quarterly fantastic. ask you a the consider

Randall Fields

John?

John Merrill

people can Is gives of but that some the to I table, the don't to an think would where a much want Of it's at course, Board I as sight approve look the the I'd that I I to possible? think future? just dividend sight quarter-to-quarter. line opposed it's count dividend in would rather off line possible, as quarterly increase it dividend of have what rather to quarterly investors. but investor, on

Thomas Forte

Okay.

differently, John So and then stated Randy.

far margin would a on had you you exceeded had So of it, if an expectations What the of with hypothetically? level -- do you your cash just dollar, if incremental high and massive pace adoption given influx. contribution

John Merrill

dividend. assume you the would To would saying of that. from and operations preferred a operations we're what that what To form cash, It's of the buying exactly half return at mean influx big and take well. had change shares could that that we back influx least saying. least have also would consider half of we're cash your We to special the That that in we point, the of take your anything. increasing sign-up a dividend. number look doesn't cash the we redeeming at that we're doing. at Exactly half point, if and and rapid from as would -- It

Thomas Forte

won't ask I third a you right. question. All

what doing artificial bottom So And with are our artificial intelligence-related top future might improves today how line? Randy, efforts and intelligence? you your

Randall Fields

we paper is less focus of own most to we how in to and decisions, work better administrivia, directed to call that moving on customers. their Well, people, our able better what AI toward around do allow them the make candidly and stuff do

of a other pursuing we've been can of as we have that I'd of size double but based, We many double. double. couple the are a additional another have have the we we're We from stuff words, people. the of of Again, control that perhaps not workload very you company spans ideas expand we, executing another company comes that opportunities think people think our say, know, other for aggressively In the AI AI years. doing could we couple that the

our So it's moving along, with having interacting people higher always and we them. benefit customers from level think

Thomas Forte

John, much number how I . you you're Okay. costs it the specific apologize, an on And usually pretty updated the this there? then number but on if you business. Can call, gave to run give

John Merrill

have I in That's million meaning back said I sales would where percentage cybersecurity or and short and in not cybersecurity front-loading think question? just time, forecast. mean get that's on to smooth, expenses what fast see million. the But the above million your of I go marketing going maybe may think, on takes trade we type my as or it don't you'll onboarding million. million shows million $XX it's incremental and that marketing, get in efforts. investing place. get this or that comments, I answer at that we're beyond $XX we're a And are I've at sales, the see I it where stabilize investing that same the I down. put of that -- to to would going that's same run can't And obviously, $XX we're unless out $XX getting better I $XX if up we're it Does that or it, course it over look the as thing. we say at, $XX that term

Thomas Forte

Yes. new All right. then question, And have one original one. then I my I had

at on often you imagining thoughts strong give So balance are executing what your -- you're M&A? have I'm can you're current very a very thoughts? sheet opportunities a your level. getting high You presented

Randall Fields

John thought. and the think same I have Well, I

If And the be We off laser-focused our is can are where is execution. we of the to if take that are. as execution. screw anything our or workload. the company, the do on we execution in in will history god it there's we as of an It been risk part the an run acquisition what ball where we our enormous knows we've eye else, flawless, up

magnificent team they're The really caring that's are We and do is about we why operationally inclined. and it. customers,

So we is go ball. the if do eye we the to take our acquisition, risk off an

not a in say focused be not now, that's staying bringing year it for to but on might Now different, these from now that X,XXX.

are pretty next X,XXX And the the few next we that another X,XXX new the comes queue. in odds time Remember, a hub. enter month, in are another hub be in from anywhere to more a today, There'll hundred where month, suppliers good. hub the each are

imagine number hot deal. the hand. larger. is And up of a that I got a to X,XXX isn't that do the now, little what screwing It that would will from in we've opportunity So risk very significantly year just our worth be

Thomas Forte

get right. really answer indirect then this I my hoping I was could I but is we important. this want All an to questions, And that ask you for directly. think

all to was on the confident. really really chain you're initiative, supply it and a So, what comment and ability to time, it's like the to hearing my when sometimes of lot on augment deck that it me remarks when initial But feels compliance in you're hand, like meaning feels initiatives. to made have confidence hyper-focused you about answers And I hands hear your you the there that questions, an do are this traceability. I'm prepared that --

understand you to like what I'd confidence. gives that So

Randall Fields

as whom for are is, we have the requirements now with established described number around ours reality X,XXX brought we contracted will be network. have we that that their that of it, customers customers the suppliers into Well,

in little in of that into call our I will have X,XXX time. around X,XXX hands some reasonably to network hot say, it, period can't months. up. we've now. A and that XX are ago, to for XX where we time screw year what to over all other words, the into as close be was us put like hoping We we traceability effort brought that So suppliers, in facilities were exactly the we of get

So before hopefully feeling translated hearing of about people the for. ReposiTrak were a and of the good traceability team we were that that do. difference hoping we are we will and the is where into we that and feeling business has the obligations had preeminence the what drive That revenue contractual

real. hope a difference it's between and So

Thomas Forte

my again. Okay. I've exhausted Congrats questions.

Randall Fields

you. Thank

Jeff Stanlis

Tom. Thanks,

Operator

Thank this time. hand closing to any the you. at would There for Randy questions like are floor I no to further comments. over Fields back

Randall Fields

of for John, talking thank on support. you guys afternoon, way Rob. know going the very We very, where about to Thank heads and be and call say we're in feel there's just you thank done. it work nothing getting down Thank are. But to all the we'll is. It's you, the whatnot. absorption be for we the this good soon. to We being closing, we Really of you. you issues

John Merrill

everyone. Thanks, a great Have day.

Operator

concludes conference This call. today's

time. disconnect your for may lines your Thank at participation. you You this

ReposiTrak (TRAK) 30 Sep 242024 Q4 Earnings call transcript