ReposiTrak FY2026 operating income rises 26% to $7.8M
Annual operating income rose 26%, while ReposiTrak reported $27.3 million in cash and no bank debt at fiscal year-end.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Filing Summary
ReposiTrak, Inc. reported fiscal 2026 revenue of $23.3 million, up 3% from $22.6 million, as operating expenses fell 6% to $15.4 million. Income from operations rose 26% to $7.8 million and GAAP net income increased 8% to $7.6 million. Net income to common shareholders was $7.4 million, up 12%, and diluted EPS was $0.39 versus $0.35.
For the quarter ended June 30, 2026, revenue was $5.6 million, down 3%, while GAAP net income rose 16% to $2.1 million. The company generated $8.2 million in operating cash flow, ended June 30, 2026 with $27.3 million in cash and no bank debt, and returned $5.3 million of capital to shareholders through dividends, common stock repurchases and preferred share redemptions.
ReposiTrak entered an agreement to provide SPAR Group a $4.0 million credit facility and separately acquired approximately $2.4 million of its common stock. The companies introduced Touchless Merchandising; ReposiTrak reported initial supplier agreements and expected a little revenue in the current quarter, with a significant contribution in 2027 and beyond. The FDA extended the food traceability compliance date to July 20, 2028, and Congress directed the FDA not to enforce the rule before then.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointFiscal 2026 operating income rose 26% to $7.8 million.
- Moderate pointFiscal 2026 GAAP net income increased 8% to $7.6 million.
- Minor pointFourth-quarter GAAP net income rose 16% to $2.1 million.
Negative
- None.
Filing Explained
The December two thousand twenty-six preferred-share redemption goal remains conditional and incomplete.
The 8-K reports that ReposiTrak declared a September quarterly cash dividend of
At
At
8-K Event Classification
Key Figures
Key Terms
operating leverage financial
recurring SaaS revenue financial
net operating losses financial
direct store delivery technical
Traceability Rule 204 regulatory
Earnings Snapshot
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How did TRAK perform financially in fiscal 2026?
What agreement did TRAK enter into with SPAR Group?
When is the food traceability compliance deadline?
What dividend did TRAK declare for September 2026?
AI-generated analysis. How Rhea-AI works. Not financial advice.
(State or other jurisdiction of incorporation) | (Commission File No.) | (IRS Employer Identification No.) |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of exchange on which registered |
Exhibit Number | Description |
|
99.1 | Press Release, dated September 28, 2026 |
|
99.2 | Earnings Call Transcript |
|
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
REPOSITRAK, INC. |
|
Date: September 30, 2026 | /s/ John Merrill |
John Merrill |
|
Chief Financial Officer |
Exhibit 99.1
ReposiTrak Reports 16% Increase in Net Income 20% Increase in EPS,
for Fourth Quarter of Fiscal 2026
Full-Year Net Income Up 8%; Full-Year Diluted EPS of $0.39;
Company Returns $5.3 Million of Capital to Shareholders, Ends Year with $27.3 Million in Cash & No Bank Debt
Salt Lake City, UT – September 28, 2026 –ReposiTrak (NYSE: TRAK), an AI-powered, integrated supply chain platform, today announced financial results for the fourth fiscal quarter and full year ended June 30, 2026.
Fiscal Year Financial Highlights (12 months ended June 30, 2026 vs. 12 months ended June 30, 2025):
| ● | Full fiscal year revenue of $23.3 million, up 3% year-over-year. |
| ● | Operating expense decreased 6% to $15.4 million. |
| ● | Operating income increased 26% to $7.8 million. |
| ● | GAAP net income increased 8% to $7.6 million. |
| ● | Net income to common shareholders was $7.4 million, up 12.0%. |
| ● | EPS of $0.41 per basic and $0.39 per diluted share. |
| ● | The Company finished the period with $27.3 million in cash and no bank debt. |
| ● | The Company generated $8.2 million in cash from operations for fiscal 2026. |
| ● | During the fiscal year, the Company redeemed 175,233 preferred shares for the stated redemption price of $10.70 per share for a total of $1,874,993. |
| ● | During the fiscal year, the Company repurchased and cancelled 143,904 common shares for an average price of $12.50 per share for a total of $1,798,537. |
Fourth Fiscal Quarter Financial Highlights (three months ended June 30, 2026 vs. three months ended June 30, 2025):
| ● | Fourth quarter total revenue of $5.6 million, down 3% year-over-year. |
| ● | Operating expense decreased 11% to $3.7 million. |
| ● | Operating income increased 19% to $1.9 million. |
| ● | GAAP net income increased 16% to $2.1 million. |
| ● | Net income to common shareholders was $2.1 million, up 16%. |
| ● | EPS of $0.11 per basic and diluted share. |
| ● | On June 18, 2026, the Board declared a quarterly dividend of $0.02 per quarter ($0.08 per share annually) to shareholders of record on June 30, 2026. The cash dividends were paid to shareholders of record on or about August 14, 2026. Subsequent dividends will be paid within 45 days of each fiscal quarter end. |
Randall K. Fields, Chairman and Chief Executive Officer of ReposiTrak, commented: "We continue to make progress across each of our businesses, while also developing and scaling our new offering with the SPAR Group. Touchless Merchandising leverages ReposiTrak’s technology, identifying supply chain and inventory issues in real time, and SPAR’s field organization, which addresses those issues in the store. Together, we believe this creates an innovative and differentiated scan-based trading solution that can deliver meaningful value to both retailers and brands. Customer interest has been strong, and we have already signed initial agreements with suppliers.”
“Simultaneously, we continue to expand our leadership position in traceability,” continued Mr. Fields. “Food safety remains a significant challenge for the industry. So far in 2026, the industry has faced issues related to Cyclospora, Salmonella Javiana, Listeria and E. coli, resulting in well over 100 recalls, hundreds of hospitalizations and multiple deaths. As we move closer to the government’s traceability deadline, we expect these events to further reinforce the need for reliable, end-to-end traceability. ReposiTrak is uniquely positioned as the only provider offering true, touchless traceability from farm to shelf, and we expect demand to accelerate as the deadline approaches.”
“Our fiscal 2026 results demonstrate the operating leverage in our business model,” concluded Mr. Fields. “Revenue increased 3%, while operating expenses declined 6%, driving a 26% increase in operating income. We also generated $8.2 million in cash from operations and ended the year with more than $27 million in cash and no bank debt. At the same time, we continued to invest in our technology and returned $5.3 million of capital to shareholders through dividends, common stock repurchases and preferred share redemptions. We believe our profitability; cash generation and strong balance sheet give us considerable flexibility to invest in growth while continuing to return capital to shareholders.”
Fourth Fiscal Quarter Financial Results (three months ended June 30, 2026, vs. three months ended June 30, 2025):
Revenue was $5.6 million as compared to $5.8 million in the prior-year fourth quarter. Total operating expense was $3.7 million, down 11% compared to $4.2 million last year. SG&A expense was $2.8 million, down 4% from $2.9 million last year. GAAP net income was $2.1 million compared to $1.8 million, an increase of 16%. Net income to common shareholders was $2.1 million, or $0.11 per basic and diluted share, compared to $1.7 million, or $0.09 per basic and diluted share, representing an increase of 19%.
Fiscal Year Financial Results (12 months ended June 30, 2026, vs. 12 months ended June 30, 2025):
Revenue increased 3% to $23.3 million as compared to $22.6 million in the prior-year period. Total operating expense was $15.4 million, down 6% compared to $16.4 million last year. SG&A expense was $11.5 million, up less than 1% from $11.4 million last year. GAAP net income was $7.6 million compared to $7.0 million, an increase of 8%. Net income to common shareholders was $7.4 million, or $0.41 per basic and $0.39 per diluted share, compared to $6.6 million, or $0.36 per basic and $0.35 per diluted share, representing an increase of 12%.
Return of Capital:
During the fiscal year, the Company redeemed 175,233 preferred shares at the stated redemption price of $10.70 per share for a total of approximately $1.9 million. As of June 30, 2026, a total of 160,865 shares of Series B preferred remained issued and outstanding. Since inception, a total of 676,912 preferred shares, including Series B and Series B-1 preferred, at the redemption price of $10.70 per share have been redeemed for a total of approximately $7.2 million. All Series B-1 preferred shares have been redeemed. The remaining amount available for future preferred redemptions is $1.72 million.
During the fiscal year, the Company repurchased 143,904 common shares for a total of $1.8 million at an average of $12.50 per share. The Company has approximately $6.0 million remaining on the $21.0 million total common share buyback authorization.
On June 18, 2026, the Board declared a quarterly dividend of $0.02 per quarter ($0.08 per share annually) to shareholders of record on June 30, 2026. The cash dividends have been paid to shareholders of record on or about August 14, 2026. Subsequent dividends will be paid within 45 days of each fiscal quarter end.
Balance Sheet:
The Company had $27.3 million in cash and cash equivalents at June 30, 2026, compared to $28.6 million at June 30, 2025. As part of a go-to-market collaboration with SPAR Group, ReposiTrak entered into an agreement to provide SPAR with a $4.0 million credit facility and separately acquired approximately $2.4 million of SPAR Group common stock.
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: Monday, September 28, 2026
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: 13762421
Replay Dial-In Numbers:
Toll Free: 1-844-512-2921
Toll/International: 1-412-317-6671
Conference ID: 13760307
Replay Start: Monday, September 28, 2026, 7:15 p.m. ET
Replay Expiry: Wednesday, October 28, 2026 at 11:59 p.m. ET
About ReposiTrak
ReposiTrak, Inc. (NYSE: TRAK) is an AI-powered, integrated platform that connects retailers, wholesalers, suppliers, and food manufacturers through a suite of applications designed to reduce risk, support regulatory compliance, strengthen operational controls, and protect brand integrity. The ReposiTrak platform serves as a shared system of record across its solution areas, maintaining and synchronizing complex supplier and customer data to enable secure, accurate, and scalable information exchange.
ReposiTrak’s solutions are organized into three core product families: traceability, compliance and risk management, and supply chain solutions. Through its scalable, cloud-based platform and U.S.-based team of experts, the Company helps organizations streamline operations, improve data transparency, and meet evolving regulatory requirements across the food supply chain. For more information, visit www.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.
Investor Relations Contact:
John Merrill, CFO
Investor-relations@repositrak.com
Or
FNK IR
Rob Fink
646.809.4048
rob@fnkir.com
REPOSITRAK, INC.
Consolidated Balance Sheets
| | June 30, | | | June 30, | |
||
| | 2026 | | | 2025 | |
||
Assets | | | | | | | | |
Current Assets | | | | | | | | |
Cash | | $ | 27,256,008 | | | $ | 28,568,805 | |
Receivables, net of allowance for doubtful accounts of $249,818 and $242,437 at June 30, 2026 and 2025, respectively | | | 4,613,739 | | | | 4,133,026 | |
Contract asset – unbilled current portion | | | 433,783 | | | | 428,585 | |
Prepaid expense and other current assets | | | 449,298 | | | | 555,384 | |
Total Current Assets | | | 32,752,828 | | | | 33,685,800 | |
| | | | | | | | |
Property and equipment, net | | | 303,896 | | | | 602,172 | |
| | | | | | | | |
Other Assets: | | | | | | | | |
Note receivable, net | | | 2,277,778 | | | | - | |
Investment in equity securities, at fair value | | | 3,462,700 | | | | - | |
Deposits and other assets | | | 122,414 | | | | 22,414 | |
Prepaid expense – less current portion | | | 2,762 | | | | 6,568 | |
Goodwill | | | 20,883,886 | | | | 20,883,886 | |
Deferred income taxes | | | 51,035 | | | | - | |
Capitalized software costs, net | | | - | | | | 128,207 | |
Capitalized software development in progress | | | 1,000,412 | | | | - | |
Total Other Assets | | | 27,800,987 | | | | 21,041,075 | |
| | | | | | | | |
Total Assets | | $ | 60,857,711 | | | $ | 55,329,047 | |
| | | | | | | | |
Liabilities and Shareholders’ Equity | | | | | | | | |
Current liabilities | | | | | | | | |
Accounts payable | | $ | 522,404 | | | $ | 282,146 | |
Accrued liabilities | | | 3,240,318 | | | | 1,841,839 | |
Contract liability – deferred revenue | | | 4,509,815 | | | | 3,175,908 | |
Notes payable and financing leases – current | | | 232,842 | | | | 231,225 | |
Total current liabilities | | | 8,505,379 | | | | 5,531,118 | |
| | | | | | | | |
Long-term liabilities | | | | | | | | |
Notes payable and financing leases – less current portion | | | 61,498 | | | | 278,748 | |
Total liabilities | | | 8,566,877 | | | | 5,809,866 | |
| | | | | | | | |
Commitments and contingencies | | | | | | | | |
| | | | | | | | |
Stockholders’ equity: | | | | | | | | |
Preferred Stock; $0.01 par value, 30,000,000 shares authorized; | | | | | | | | |
Series B Preferred, 700,000 shares authorized; 160,865 and 336,098 shares issued and outstanding at June 30, 2026 and 2025 respectively | | | 1,609 | | | | 3,361 | |
Common Stock, $0.01 par value, 50,000,000 shares authorized; 18,189,408 and 18,282,805 issued and outstanding at June 30, 2026 and 2025, respectively | | | 181,896 | | | | 182,830 | |
Additional paid-in capital | | | 59,159,098 | | | | 62,181,156 | |
Accumulated other comprehensive loss | | | (36,708 | ) | | | (11,256 | ) |
Accumulated deficit | | | (7,015,061 | ) | | | (12,836,910 | ) |
Total stockholders’ equity | | | 52,290,834 | | | | 49,519,181 | |
Total liabilities and stockholders’ equity | | $ | 60,857,711 | | | $ | 55,329,047 | |
REPOSITRAK, INC.
Consolidated Statements of Operations
| | For the Years Ended | |
|||||
| | June 30, | |
|||||
| | 2026 | | | 2025 | |
||
| | | | | | | | |
Revenue | | $ | 23,287,319 | | | $ | 22,606,066 | |
| | | | | | | | |
Operating expense: | | | | | | | | |
Cost of revenue and product support | | | 3,306,855 | | | | 3,681,330 | |
Sales and marketing | | | 5,751,151 | | | | 5,843,272 | |
General and administrative | | | 5,738,314 | | | | 5,602,807 | |
Depreciation and amortization | | | 647,637 | | | | 1,251,514 | |
Total operating expense | | | 15,443,957 | | | | 16,378,923 | |
| | | | | | | | |
Income from operations | | | 7,843,362 | | | | 6,227,143 | |
| | | | | | | | |
Other income (expense): | | | | | | | | |
Interest income | | | 1,541,459 | | | | 1,383,535 | |
Interest expense | | | (38,483 | ) | | | (48,671 | ) |
Gain on lease termination | | | - | | | | 12,262 | |
Realized gain (loss) on short term investments | | | (19,052 | ) | | | 97,384 | |
Unrealized gain (loss) on short term investments | | | 192,200 | | | | (17,676 | ) |
Income before income taxes | | | 9,519,486 | | | | 7,653,977 | |
| | | | | | | | |
(Provision) for income taxes | | | (1,949,999 | ) | | | (675,850 | ) |
Net income | | | 7,569,487 | | | | 6,978,127 | |
| | | | | | | | |
Dividends on Preferred Stock | | | (167,804 | ) | | | (360,306 | ) |
| | | | | | | | |
Net income applicable to common shareholders | | $ | 7,401,683 | | | $ | 6,617,821 | |
| | | | | | | | |
Weighted average shares, basic | | | 18,236,000 | | | | 18,262,000 | |
Weighted average shares, diluted | | | 18,981,000 | | | | 19,141,000 | |
Basic earnings per share | | $ | 0.41 | | | $ | 0.36 | |
Diluted earnings per share | | $ | 0.39 | | | $ | 0.35 | |
| | | | | | | | |
Comprehensive income: | | | | | | | | |
Net income | | $ | 7,569,487 | | | $ | 6,978,127 | |
Other comprehensive loss: | | | | | | | | |
Unrealized gain (loss) on available-for-sale securities | | | (25,452 | ) | | | 16,134 | |
Total comprehensive income | | $ | 7,544,035 | | | $ | 6,994,261 | |
REPOSITRAK, INC.
Consolidated Statements of Cash Flows
| | For the Years Ended | |
|||||
| | June 30, | |
|||||
| | 2026 | | | 2025 | |
||
Cash flows from operating activities: | | | | | | | | |
Net income | | $ | 7,569,487 | | | $ | 6,978,127 | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | | |
Depreciation and amortization | | | 647,637 | | | | 1,251,514 | |
Amortization of operating right of use asset | | | - | | | | 63,597 | |
Amortization of loan discount | | | (77,778 | ) | | | - | |
Stock compensation expense | | | 444,510 | | | | 403,783 | |
Gain on termination of operating lease | | | - | | | | (12,262 | ) |
Unrealized gain (loss) on investments | | | (192,200 | ) | | | 17,676 | |
Net amortization/accretion | | | (81,235 | ) | | | - | |
Realized loss on investments | | | 19,052 | | | | (97,384 | ) |
Common stock received in settlement of accounts receivable | | | (2,325,000 | ) | | | - | |
Deferred income tax benefit | | | (51,035 | ) | | | - | |
Bad debt expense | | | 950,000 | | | | 600,000 | |
(Increase) decrease in: | | | | | | | | |
Accounts receivables | | | (1,744,042 | ) | | | (1,221,596 | ) |
Operating right of use asset | | | - | | | | 186,709 | |
Contract assets and unbilled receivables | | | (5,197 | ) | | | - | |
Long-term receivables, prepaids and other assets | | | 109,892 | | | | (447,479 | ) |
Increase (decrease) in: | | | | | | | | |
Accounts payable | | | 240,258 | | | | 17,060 | |
Operating lease liability | | | - | | | | (250,786 | ) |
Accrued liabilities | | | 1,386,550 | | | | 196,499 | |
Deferred revenue | | | 1,333,907 | | | | 734,674 | |
Net cash provided by operating activities | | | 8,224,806 | | | | 8,420,132 | |
| | | | | | | | |
Cash flows from investing activities: | | | | | | | | |
Issuance of note receivable | | | (3,000,000 | ) | | | - | |
Purchase of property and equipment | | | (16,594 | ) | | | (15,965 | ) |
Investment deposit | | | (100,000 | ) | | | - | |
Capitalization of software development costs in progress | | | (1,000,412 | ) | | | - | |
Sale (purchase) of marketable securities | | | - | | | | 16,134 | |
Net cash (used in) provided by investing activities | | | (4,117,006 | ) | | | 169 | |
| | | | | | | | |
Cash flows from financing activities: | | | | | | | | |
Common stock buyback/retirement | | | (1,798,537 | ) | | | (200,035 | ) |
Redemption of Series B Preferred | | | (1,874,993 | ) | | | (2,999,970 | ) |
Proceeds from exercise of warrants | | | - | | | | 79,120 | |
Proceeds from employee stock plan | | | 104,519 | | | | 134,346 | |
Dividends paid | | | (1,635,953 | ) | | | (1,656,377 | ) |
Payments on notes payable and capital leases | | | (215,633 | ) | | | (362,442 | ) |
Net cash used in financing activities | | | (5,420,597 | ) | | | (5,005,358 | ) |
| | | | | | | | |
Net (decrease) increase in cash and cash equivalents | | | (1,312,797 | ) | | | 3,414,943 | |
| | | | | | | | |
Cash and cash equivalents at beginning of period | | | 28,568,805 | | | | 25,153,862 | |
Cash and cash equivalents at end of period | | $ | 27,256,008 | | | $ | 28,568,805 | |
| | | | | | | | |
Supplemental Disclosure of Cash Flow Information | | | | | | | | |
Cash paid for income taxes | | $ | 734,928 | | | $ | 435,059 | |
Cash paid for interest | | $ | 15,411 | | | $ | 21,023 | |
Cash paid for operating leases | | $ | - | | | $ | 56,244 | |
| | | | | | | | |
Supplemental Disclosure of Non-Cash Investing and Financing Activities | | | | | | | | |
Common Stock to pay accrued liabilities | | $ | 421,604 | | | $ | 313,218 | |
Dividends accrued on Preferred Stock | | $ | 167,804 | | | $ | 360,306 | |
Right of use asset | | $ | - | | | $ | 654,444 | |
Exhibit 99.2
ReposiTrak
Fiscal Fourth Quarter 2026 Earnings Call
September 28, 2026
C O R P O R A T E P A R T I C I P A N T S
Jeff Stanlis, FNK IR, LLC
John Merrill, Chief Financial Officer
Randy Fields, Chairman and Chief Executive Officer
C O N F E R E N C E C A L L P A R T I C I P A N T S
Thomas Forte, Maxim Group
1
P R E S E N T A T I O N
Operator
Greetings and welcome to the ReposiTrak Fiscal Fourth Quarter 2026 Earnings Call.
At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require Operator assistance, please press star zero on your telephone keypad.
As a reminder, this conference is being recorded.
It is now my pleasure to introduce Jeff Stanlis of FNK IR. Please go ahead.
Jeff Stanlis
Thank you, Operator, and good afternoon, everyone. Thank you for joining us today for ReposiTrak's fiscal fourth quarter 2026 earnings conference call.
Hosting the call today are Randy Fields, ReposiTrak's Chairman and CEO, and John Merrill, ReposiTrak's CFO.
Before we begin, I would like to remind everyone that this call could contain forward-looking statements about ReposiTrak within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that are not subject to historical facts. Such forward-looking statements are based on current beliefs and expectations. ReposiTrak's remarks are subject to risks and uncertainties, and actual results may differ materially. Such risks are fully discussed in the Company's filings with the Securities and Exchange Commission. The information set forth herein should be considered in light of such risks. ReposiTrak does not assume any obligation to update information contained on this conference call.
Shortly after the market closed today, the Company issued a press release overviewing the financial results we will discuss on today's call. Investors can visit the Investor Relations section of the Company's website at ReposiTrak.com to access this press release.
With all that said, I would now like to turn the call over to John Merrill. John, the call is yours.
John Merrill
Thanks, Jeff, and good afternoon, everyone.
Our strong results for fiscal 2026 demonstrate continued execution against our stated strategy. We've continued to shift our revenue mix towards highly predictable recurring SaaS revenue. We continue to grow this revenue while simultaneously improving our operating cost structure. During the fiscal year, total revenue grew 3%, recurring revenue grew 4%, while total operating expenses declined 6%.
As part of our ongoing strategy, we deliberately de-emphasized certain high-touch, low-margin revenue streams, focusing instead on opportunities with the greatest growth potential and profitability. This moderated our revenue growth while contributing to an improved operating margin profile. The result is clear operating leverage, higher GAAP net income, higher earnings per share, solid cash generation, and the continued return of capital to Shareholders.
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in the reporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 https://viavid.com/
2
At the same time, we are investing in the long-term infrastructure of our business, both organically through the refresh of our technology stack and continued investment in our traceability solution and through our collaborative relationship and investment in SPAR Group, which supports our newest initiative, Touchless Merchandising. Randy will discuss Touchless Merchandising in his prepared comment shortly. We view this initiative as a natural extension of our broader platform strategy across traceability, compliance, risk management, and supply chain solutions. I will focus my comments today on the financial results and our capital allocation priorities.
Let's get to the numbers. For the full fiscal year, total revenue increased 3% from $22.6 million to $23.3 million. Total operating expenses for the fiscal year were $15.4 million versus $16.4 million last year, a decrease of 6%. These results demonstrate the operating leverage in our business model as we continue to scale our SaaS platform and improve automation.
Operating margin expanded to approximately 33.7% from 27.5% last year, an increase of approximately 620 basis points. Income from operations was up 26% for the fiscal year to $7.8 million versus $6.2 million. GAAP net income increased 8% from $7 million to $7.6 million.
As previously communicated, the Company is nearing the end of the benefit period associated with historical federal and state net operating losses, or NOLs. Our effective tax rate for fiscal 2026 was approximately 21% for federal, 3% for state. As those historical tax benefits diminish, we expect our overall effective tax rate may increase subject to available state and federal tax credits and other tax attributes.
GAAP net income to common Shareholders increased 12% from $6.6 million in fiscal 2025 to $7.4 million in fiscal 2026, despite an income tax provision of approximately $2 million compared with approximately $700,000 last year, an increase of approximately 190%.
Fiscal 2026 earnings per share were $0.41 basic and $0.39 diluted, based on approximately 18.3 million weighted average basic shares and 19 million weighted average diluted shares, respectively. Diluted earnings per share increased 13% to $0.39 compared with $0.35 for fiscal 2025.
Turning to the fourth quarter numbers, fourth fiscal quarter 2026, revenue was down 3% year-over-year at $5.6 million. As a reminder, the second half of last year included an accelerated pace of traceability activity as the FDA's original January 20, 2026, compliance date approached. As previously communicated, the FDA has extended the compliance date to July 20, 2028, and Congress has directed FDA not to enforce the food traceability rule before that date. We believe customer activity could increase as the industry prepares for that new deadline date.
Total operating expenses for the quarter were down 11% to $3.7 million from $4.2 million, reflecting continued cost discipline and operating efficiencies. Cost of services was down 12% due partially to capitalized software costs as we significantly enhance our software stack. Sales and marketing was down 11%. G&A expense was up 3% due to higher benefit costs and other employee costs. Depreciation and amortization declined 75%, primarily because intangible and hard assets became fully amortized or depreciated. Income from operations was up 19% to $1.9 million versus $1.6 million.
GAAP net income for the fourth fiscal quarter of 2026 was $2.1 million, up 16% versus $1.8 million last year. Keep in mind this also considers an almost 200% increase in income tax expense. GAAP net income to common Shareholders increased 19% to $2.1 million from $1.7 million.
Earnings per share for the quarter were $0.11 per basic and diluted share, based on approximately 18.2 million weighted average basic shares and 19 million weighted average diluted shares. Diluted earnings per share increased approximately 20% year-over-year, despite the higher income tax burden.
Turning to capital allocation and liquidity. We ended fiscal 2026 with $27.3 million in cash, plus our $3 million note receivable from SPAR Group as of June 30, 2026. For fiscal 2026, we generated approximately $8.3 million of cash from operations, compared with $8.4 million last year. Our strong balance sheet, continued profitability, and cash generation provides meaningful financial flexibility. The Company continues to have zero bank debt.
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During fiscal 2026, the Company repurchased and canceled approximately 144,000 common shares for an average price of $12.50 per share, for a total of approximately $1.8 million. Since inception of the buyback program, we have repurchased and canceled approximately 2.3 million common shares for approximately $15.2 million, at an average price of $6.60 per share. As of June 30, 2026, approximately $6 million remained under the $21 million total common share repurchase authorization.
The Company holds no treasury stock. Shares are simply repurchased and subsequently canceled. During the year, we redeemed 175,000 preferred shares at the stated redemption price of $10.70 per share, for a total of approximately $1.9 million. Since inception, the Company has redeemed approximately 677,000 preferred shares at the stated redemption price of $10.70 per share, for a total of approximately $7.3 million. We have approximately 161,000 preferred shares remaining, representing approximately $1.7 million at the stated redemption price. Our current goal remains to redeem all remaining preferred shares outstanding on or before December 2026, subject to business conditions, liquidity requirements, and the Board's ongoing evaluation of our capital allocation priorities.
On June 18, 2026, the Board declared a quarterly dividend of $0.02 per share, $0.08 per share annually, to Shareholders of record on June 30, 2026. The cash dividends were paid to Shareholders of record on or about August 14, 2026. Again, on September 15, 2026, the Board declared a September quarterly dividend of $0.02 to Shareholders of record on September 30, 2026. It is anticipated that cash dividends will be paid to September 2026 Shareholders on or about November 14, 2026.
As previously communicated, all declared dividends will be paid within 45 days of each fiscal quarter end. From time to time, the Board will evaluate our capital allocation strategy and make adjustments based on business conditions in the approach it believes is most favorable for the Company and its Shareholders at that time. Our continued capital allocation objective is to return approximately 50% of annual cash from operations to Shareholders while retaining the balance to strengthen the balance sheet and fund future operations.
In summary, our strategy has not changed. First and foremost, take exceptional care of the customer and execute flawlessly. Next, grow recurring revenue, increase profitability faster than revenue, use cash to repurchase common stock and redeem the preferred shares, maintain a debt-free balance sheet and return capital to Shareholders through our cash dividend.
That's all I have today. Thanks, everyone, for your time. At this point, I'll pass the call over to Randy. Randy?
Randy Fields
Thanks, John.
ReposiTrak is continuing to expand its strategic position as the go-to vendor for food safety and on-shelf availability for the retail food industry. From compliance to supply chain to traceability, we've set the standard for highly automated, incredibly accurate, remarkably simple, and very affordable solutions.
Each of our businesses performed well during the quarter in spite of the fact that we put a great deal of focus on a new, very large supply chain opportunity, touchless retailing. This particular supply chain initiative is an important one because we believe it's not only a great market opportunity for us, but critically, it solves a set of issues that our customers all experience.
As technology gets better and problems are more easily identified, the bottleneck isn't knowing what needs to be done, but rather actually getting it done. In other words, having the people actually fix the problems. Those problems are especially acute in the direct store delivery segment of the retail food industry, and that's where we're focused.
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Remember, the idea behind the entire concept of direct store delivery, which is now more than 30% of grocery sales, was that the retailer would not have to provide labor to keep the product on the shelf. The DSD vendor would take that on with their own people or with third parties. In short, the retailer provided the shelf, and the vendor provided the people to take care of the shelf. That promise is not being kept.
Right now, merchandising cost and quality are major pain points for both suppliers and for retailers. Suppliers pay merchandisers to keep shelves stocked, but the work is expensive, and frankly, it's not done very well. Over the years, the cost of merchandising has gone up. DSD suppliers have done the obvious. They cut the frequency of touching the merchandise. That, in turn, has resulted in more out-of-stocks and lower sales. Simple, just like you'd expect. The industry's in a spiral, and we think touchless retailing, as we call it, may be an important part of the ultimate answer.
For years, ReposiTrak has been superb at telling retailers and suppliers about supply chain issues, out-of-stocks, etc. We have tremendous visibility into data and trends, and we can note which stores sell more of a certain product and therefore need more merchandising attention, and which ones lag. But visibility without action doesn't solve the root problems for either the suppliers or the retailers.
Our touchless retail offering gives our customers the ability to actually fix the problems, not just identify them. We believe that our new service will not only reduce the merchandising costs for our customers, but even more importantly, will enable them to increase sales in a meaningful way. Over the next several months, we'll begin to generate the data that we think, in terms of sales increases, supports the fact that we can do that, and we suspect that will help us get many, many additional customers.
Beyond that, adding an ability to fix identified problems through people is the ultimate anti-AI strategy for us. In simplest terms, AI will never have arms and legs that can go into a store and touch product. It's obvious, by the way, that we can charge more for such a service, not just to diagnose the problem, but to actually fix it. Our retail customers win with higher sales, our supplier customers win with higher sales, and we get higher sales.
In order to add this uniquely human capability, ReposiTrak has now aligned itself with the SPAR Group, one of the largest U.S. merchandising companies. In fact, I believe we are now the largest shareholder of the SPAR Group, and our touchless retail offering is designed to address every single one of these pain points for our DSD suppliers. We pair our data and our visibility with the very best team at SPAR. Seriously, only the top performers of SPAR.
We create a squad of very talented, proven merchandising experts that can remediate these stocking issues, and the program's resonating. We introduced the service about a month ago, and we've already signed and begun executing several contracts. The technical integration with SPAR and the ramp-up of this offering is taking a lot of time and focus for us, especially over the last quarter, but the market reception's been exceptionally high.
Incidentally, the integration, as you would imagine, is non-trivial. We're deeply integrating at a technical and reporting level to make sure that we have a common view of a customer, and that we can serve them as if we were joined at the hip with SPAR. We expect touchless retailing to generate a little revenue in the current quarter that's coming up and become a very significant and meaningful contributor in 2027 and beyond. That'll have been the fastest concept to revenue of any product we've ever introduced.
Beyond the joint offering and its revenue potential as a joint offering, we also have significant cross-sale opportunities. SPAR has a number of customers that can benefit from our technology, and we have technology customers that can use their merchandising services. If we can execute as well as I expect, this will be a very significant part of our business over the next few years. Very significant.
On to traceability. We recently spent time with the FDA staff, and especially after the summer we just experienced with food safety issues, they made it clear they have no desire to postpone the implementation of Traceability Rule 204. We continue to expect that by year end, inbound inquiry rate and interest in traceability will increase. This will have a meaningful impact on our business in 2027 as we get closer to the ‘28 deadlines.
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The headlines of the past few months reiterate why traceability is critical. As of a few weeks ago, we've had over 160 food-related recalls, way ahead of the already accelerated pace from 2025. More importantly, these recalls involve serious, sometimes deadly outbreaks. We all heard about the Cyclospora outbreak in July and August. Iceberg lettuce from a farm in Mexico led to something in excess of 11,000 illnesses across 20 states, 500 hospitalizations, and two deaths. As a result, bagged lettuce sales, for example, are down 30%. Lettuce fields in California are being plowed under.
But that's not the only outbreak. Jalapenos from Mexico led to a salmonella outbreak, resulting in, I don't know, 431 sick people in 32 states with 57 hospitalizations. Food safety problems exacerbated by a lack of traceability create an enormous cost burden to the industry. That doesn't include what you can imagine the litigation costs are likely to be. These are case studies for the importance of end-to-end traceability. It was a hell of a summer.
Traceability is critical because it enables retailers and suppliers to identify a problem quickly at the source and remove all potentially impacted products from shelves to reduce both human suffering and economic costs and do it far, far faster. That's why another FDA extension of the deadline is frankly quite unlikely.
For the year, as John mentioned, we grew revenue and simultaneously reduced our operating expenses. Our fixed costs actually went down even as we added revenue, added customers, and added offerings. The result was a significant increase again in our profitability. From a balance sheet perspective, we maintained substantial cash, giving our customers comfort and confidence in ReposiTrak, even as we invested in the SPAR Group and continued to return over $5 million of capital to the Shareholders.
Over the next fiscal year, you will see both our touchless offerings expand. As we continue to move toward the FDA deadline, we expect traceability revenue to grow more rapidly and our touchless merchandising offering to also rapidly expand revenue. Overall, we feel very, very confident about the next few years.
With that, I'd like to open the call now for questions. Operator?
Operator
Thank you. We'll now be conducting a question-and-answer session. If you would like to ask a question, please press star, one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star, two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. One moment, please, while we poll for questions.
Thank you. Our first question is from Thomas Forte with Maxim Group.
Thomas Forte
Great. John and Randy, congratulations on another good fiscal year. I'll just go one at a time on my questions. John, I apologize, you get the least interesting one first. When you compare your fiscal ‘26 results with your fiscal ‘25 results on an earnings per share basis, how much did it cost you with the higher tax rate for the full year versus last year?
John Merrill
In my remarks, it was about $2 million for this year. Last year, the expense was $700,000. I went to public school, but that's $1.3 million, that like for like was an increase between fiscal 2026 and 2025.
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Thomas Forte
How much is that in EPS?
John Merrill
You figure $200,000 for each penny. What is that $0.065 cents?
Thomas Forte
Thank you. All right. Then on the investment spending related to your software, can you talk about high level what you're investing in there?
Randy Fields
Do you mean what kinds of things are we doing investment-wise with our software?
Thomas Forte
Yes.
Randy Fields
God, there's a whole variety of things that are actually going on. We're in the process of rewriting almost the entirety of our technology stack with three intentions. We're going to more deeply embed AI capabilities in what we're doing. We've always been a pioneer in the area of AI, but we're going to more deeply embed it. That's number one.
Number two is we're now going to be sharing customers with SPAR. We're modifying our technology to create the ability for both companies to act as one. I know that sounds relatively trivial, but it's actually very difficult. We both want to be able to look at a customer, the results. We want to treat the customer between us in a way so that things never fall through the cracks. We're doing major technology changes both for SPAR and ourselves in order to have that capability.
We've announced several new products, as you know, and we're investing in those products as well. Perhaps the most interesting thing that will change, we think, how the world sees us is, as we now have the capability to fix problems with people with SPAR, we're going to go much deeper into the analytics of the supply chain so we can identify out-of-stocks and whatnot more quickly and deal with them more in real time. There's an enormous amount of development work going on.
Thomas Forte
All right. Then...
Randy Fields
Is that the question you were asking? I just want to make sure I answered the question.
Thomas Forte
Yes. Thank you for that. John, historically, you've provided a number on the amount of money it requires to run the business. With Randy talking about embedding AI more deeply, does that change that number?
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John Merrill
Not at all. I mean, we still maintain that we're sub-$12 million in cash, take accounting out of it, bad debt expense, stock comp, accounting. We're still sub-$12. It's about $11.4 million right now. Now, will those increases or those significant enhancements to our software stack change that? The answer is no, because as we've done in the past, we would just reallocate, like you've seen with our total expenses have gone down dramatically. We would just reallocate. We wouldn't spend more on those enhancements with the software development.
Randy Fields
Actually, I think he was asking—I could be wrong, John, but I think he was actually asking the reverse question. Will this ultimately enable our cost structure to be lower as time goes on? Some of the things that we're doing will take more human requirements out of the equation. As we do more work with SPAR, it's not unreasonable to imagine our expenses lightening up a little bit even from where they are. They'll definitely not go up significantly.
Thomas Forte
Okay. Then, Randy, did you give a statistic on the percent of food retailers' orders that are essentially online deliveries? I think I saw you gave a statistic there.
Randy Fields
I didn't. I think the stat that I gave relates to direct store delivery, which is how suppliers get product to the stores. Really, there's multiple paths. The two biggest paths are through a warehouse, a distributor-owned warehouse, or we call it self-distributor, where the retailer owns his own distribution centers. That's about 70%.
The remainder, 30%, is direct store delivery, where vendors like Coke and Pepsi and others come directly to each of the retail stores, bring product in, put it on the shelf, and take care of the product, easing the labor pains of a retailer. That's the area where we have both the greatest market penetration and, frankly, the greatest expertise. That's the area that is fraught with poor ordering. You have to think about it, there are thousands and thousands of relatively small vendors, notwithstanding the Cokes and Pepsis. The rest are small. These smaller vendors have trouble first staffing to get into stores to address the merchandising issue, secondly, to figure out what the order ought to be, and they just don't have the tools.
That's our market opportunity. There are thousands of these vendors that have the need that they've got to have better merchandising capability than they do today. They need that and want that at a lower cost with higher effectiveness. They need the ability to have automated ordering that we bring to the table. The maintenance of perpetual inventories and whatnot, all of which are part of the service that we provide to DSD vendors. This segment of the market, this 30% of the entire grocery market, really needs what we do.
Thomas Forte
All right. %hen I hate to end on a negative, but, all right, can you specifically address two macro and how they're affecting maybe your customer and you indirectly? One is just elevated price of oil. Then you had made, Randy, some pretty specific comments earlier this fiscal year on the perceived AI threat and your efforts to address that, mitigate that. Can you, I know you touched on your prepared remarks, but I'd appreciate if you expanded a little.
Randy Fields
Yeah. There's zero doubt that the increase in transportation costs, primarily because of diesel fuel, is putting more upward pressure on every aspect of the supply chain. Food moves by truck by and large. As a result, it is definitely impacted by the change in diesel prices. The result of that is that people are cautious. They're very much concerned that consumers have reached the end point of willingness to pay. It's causing the industry certainly pain and doesn't affect us per se, but it certainly is affecting the way supermarkets are approaching their business. The example is with the change in management recently, Kroger is going all in on bringing grocery prices down. They think market share now depends upon the perception that consumers have of the prices of groceries in their stores. The price battle has certainly begun.
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In terms of AI, you can tell that that seems to have quieted down a little bit. AI will enable large companies to try and bring more software systems in-house, roll your own as we call it, where they build their own systems, potentially with the aid of AI, which incidentally we think is one of the reasons that the SPAR relationship is so important to us longer term. The tool that AI can build, software, can be really good as we know, because we do it, at the identification of problems. But there's simply an issue with retailers and suppliers. It's one thing to know that there's a problem, and it's a whole different thing, who the hell goes into the store to fix it?
We believe that the future is in that ability to dispatch people, get the problem fixed, and own that space. I can't think of a more rightful heir than us. We're tremendous at the identification of issues, and with the addition of our relationship with SPAR, we're going to be even better at the full solution of how do you find and then how do you fix issues inside of retail grocery stores. We think it'll be a pretty significant addition to what we're doing. Not a substitute, it's an addition.
Thomas Forte
Excellent. Thank you so much, Randy and John, for taking on my question. Thank you, guys.
John Merrill
Thanks, Tom.
Operator
Thank you. There are no further questions at this time. I'd like to hand the floor back over to Randy Fields for any closing comments.
Randy Fields
Paul, thank you.
Thanks, everybody, for taking time this afternoon. We're obviously excited about where we are. As I said earlier, we've never introduced a product like we have with Touchless Retailing that went from a press release to revenue in about 45 days. It's pretty remarkable. We feel very good about how that's doing. We certainly feel good about how the trends in the traceability market that we've opened up are likely to be coming our way here in the next few months. We feel great about our current position. Thank you all. Talk to you soon.
John Merrill
Thank you.
Operator
This concludes today's conference. You may disconnect your lines at this time. Thank you again for your participation.
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