Park City Group Inc. (NASDAQ:PCYG) Q4 2020 Earnings Conference Call - Final Transcript
Sep 28, 2020 • 04:15 pm ET
Thank you. Our first question comes from Elliot Alper from D.A. Davidson.
Great, thank you. So, you've done a great job in maximizing our efforts in recurring revenue. So, congrats on that. That said, how should we think about the next 12 months when it comes to the factors that will drive our non-recurring revenue. And secondly, Amazon reported a 300% increase in the online grocery in the June quarter, wondering what the implications are to Park City Group? I just have one follow-up after that. Thank you.
John R. Merrill
Okay. So, why don't I take them and John, then if you have something to add chime in. First Amazon, the truth is that Amazon is the enemy of all of our friends. Everyone in the supermarket industry is worried about Amazon and their primary fear for online activity comes from Amazon. So, the better in a way that Amazon does the more the people recognize that they cannot continue to do business the way they have, it's unsettling and frankly steering the pod in this case is in fact good for us.
In terms of, and I think this is a very difficult question, in terms of how we expect the non-recurring revenue to do in the next year. The truth is, we don't know yet. We think of the business and we would encourage you to think this way as now we have to fully recurring software SaaS business that's going to continue to grow, generates very significant underlined here GAAP profitability, can you imagine that, GAAP profitability, and an additional business that to serve dysfunction to our customers that we call marketplace.
To a certain extent marketplace is derivative of the fact that our compliance work causes our customers to have to rethink suppliers in their supply chain if we help them uncover a supplier who's not doing the kind of job they ought to be from a compliance perspective, they are naturally going to turn to us for finding other vendors.
So, we've been doing this as a service. We think it has very interesting upside, but the fact of the matter is, and we're resourcing it more heavily this year. That means we're investing in it, but we think it's got interesting upside. We just don't think that we're in a place yet to forecast it. So it's fair to say that if shortages continue for some period of time then we would expect that hard to find things will be in demand by definition and that our marketplace revenue would be up. So, it's a difficult question to answer, I think if I were an investor, I would really mostly be focused on the rest of the business.
Okay, great. And then lastly, just from an operating expenses standpoint, how has COVID-19 impacted your expenses? John I think in the past you've talked about how much money it costs to run your business a year? Is that figure higher or lower now because of COVID?
John R. Merrill