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February 2018

Track Group Reports 1st Quarter Fiscal 2018 Financial Results

By News, Quarterly Reports

NAPERVILLE, ILLINOIS, February 8, 2018 – Track Group, Inc. (OTCQX: TRCK), a global leader in offender tracking and monitoring services, today announced financial results for its first quarter ended December 31, 2017 (the “First Quarter”). The Company posted gross profit of $4.5M, an increase of 26% over last year on total revenue of $7.5M, a quarterly record Adjusted EBITDA of $1.6M up 286% compared to FY2016 and total operating expenses of $4.8M, a decrease of 11% which reduced the First Quarter operating loss to its lowest level in over three years to ($0.3M).

“We’re delighted to start our fiscal year 2018 off strongly with another quarterly record for Adjusted EBITDA and the fifth consecutive quarter of growth in Adjusted EBITDA,” said Derek Cassell, Track Group’s CEO. “We are looking forward to capitalizing on a number of new customer opportunities in our pipeline so we can continue the top-line growth we have generated over the last three years.”

Business and Financial Highlights

  • The Company announced signing two large contracts totaling in excess of $30M with Marion County Community Corrections and Gendarmeria de Chile, the Republic of Chile’s prison service, shortly after the conclusion of the First Quarter;
  • Gross profit for the First Quarter $4.5M which is the best gross profit in the past five quarters and up 26% over last year ($4.5M vs. $3.5M) on quarterly revenue that was nominally down from the same period last year;
  • Total operating expenses for First Quarter ($4.8M) are down 11% vs. last year ($5.4M) and the 2nd lowest quarterly operating expenses in the last two fiscal years;
  • The lowest quarterly operating loss ($0.3M) in over three years and a 82% improvement over the quarterly operating loss of ($1.9M) in the same period last year due to a combination of a strong gross profit result and lower operating expenses;
  • Adjusted EBITDA in the First Quarter finished at a quarterly record of $1.6M up 286% compared to $0.4M last year and represented the fifth consecutive quarter that Adjusted EBITDA has increased;
  • Net loss attributable to shareholders in the First Quarter ended December 31, 2017 improved to ($1.0M) or 60% compared to ($2.6M) for the same quarter last year;
  • Net cash provided by operating activities remained positive at $0.3M in the First Quarter compared to $2.1M for last year principally due to the timing of working capital expenditures; and
  • The new CEO, Derek Cassell, appointed January 1, 2018, has realigned the management team to execute the Company’s strategy including the appointment of an industry veteran, Matt Swando, as the new Vice President of Sales and Marketing.