Track Group Reports 2nd Quarter Fiscal 2025 Financial Results

NAPERVILLE, Ill., May 14, 2025 (GLOBE NEWSWIRE) — Track Group, Inc. (OTCQB: TRCK), a global leader in offender tracking and monitoring services, today announced financial results for its fiscal quarter ended March 31, 2025 (“Q2 FY25”). In Q2 FY25, the Company posted (i) total revenue of $8.4 Million (“M”), a decrease of approximately 7% over total revenue of $9.0M for the quarter ended March 31, 2024 (“Q2 FY24”); (ii) Q2 FY25 gross profit of $4.1M representing an increase of approximately 4% over Q2 FY24 of $4.0M; (iii) Q2 FY25 operating income of $0.04M compared to Q2 FY24 operating loss of ($0.96M); and (iv) net loss attributable to common shareholders of ($0.5M) in Q2 FY25 compared to ($1.9M) in Q2 FY24.

FINANCIAL HIGHLIGHTS 

• Total Q2 FY25 revenue of $8.4M was down 7% compared to Q2 FY24 revenue of $9.0M. Revenue for the six months ended March 31, 2025 (“6M FY25’) of $17.0M was down approximately 5% compared to revenue of $18.0M for the six months ended March 31, 2024 (“6M FY24”). The decrease in monitoring revenues is driven principally by a decrease in people assigned to monitoring for clients in Virginia, and due to our recently sold Chilean subsidiary. This decrease was partially offset by revenue increases for clients in Illinois, Puerto Rico and the Bahamas who experienced increases in the number of people assigned to monitoring.
• Gross Profit of $4.1M rose by 4% ($0.1M) in Q2 FY25 compared to Q2 FY24. Gross profit for 6M FY25 was $8.5M compared to gross profit of $8.2M for 6M FY24. This improvement stems from factors including reduced monitoring center costs, partly offset by a decrease in revenue.Â
• Operating income in Q2 FY25 of $0.04M was up approximately 105% compared to an operating loss of ($0.96M) in Q2 FY24. Operating income for 6M FY25 of $0.2M was up approximately 115% compared to operating loss of ($1.1M) for 6M FY24. This rise in operating income is primarily due to a decrease in cost of revenue and a decrease in operating expense, partially offset by a decrease in revenue. Operating expenses were down $0.8M in Q2 FY25 compared to Q2 FY24, primarily due to a decrease in general and administrative payroll, benefits, and payroll taxes of $0.5M due to the sale of our Chilean subsidiary on November 1, 2024 and a settlement expense related to a contract dispute of $0.5M in Q2 FY24.
• Adjusted EBITDA for Q2 FY25 was $1.3M compared to $0.8M for Q2 FY24. Adjusted EBITDA for 6M FY25 was $2.6M compared to Adjusted EBITDA for 6M FY24 of $1.9M primarily due to negative currency exchange rate movements of $0.6M in Q2 FY25 compared to Q2 FY24. Adjusted EBITDA in 6M FY25 as a percentage of revenue increased to 15.1%, compared to 10.3% for 6M FY24.
• Cash balance of $3.4M at March 31, 2025 declined 4% compared to $3.6M at September 30, 2024.  The modest decrease in cash position was due to increases in inventory purchases and payments to vendors, partially offset by an increase in accrued liabilities.
• Net loss attributable to shareholders in Q2 FY25 was ($0.5M) compared to ($1.9M) in Q2 FY24, a decrease of $1.4M. Net loss attributable to shareholders in 6M FY25 was ($2.5M), compared to ($1.9M) for 6M FY24, a change principally attributable to negative currency exchange rate movements, partially offset by an increase in operating income.

“In the quarter ended March 31, 2025, we achieved strong gains in profitability, with both gross profit and operating income showing robust growth and Adjusted EBITDA surpassing Q2 FY24 results,” said Derek Cassell, Track Group’s CEO. “Gross profit rose by 4% year-over-year ($4.1M vs $4.0M in Q2 FY24), marking a clear indication of our operational resilience and focus on delivering higher-value, higher-margin business. Adjusted EBITDA also climbed to $1.3M in Q2 FY25, a 63% increase from $0.8M in Q2 FY24, reflecting our focus on cost management and strategic execution over the last six months.”

Business Outlook

Despite previous challenges from supply chain delays, the impact of the Coronavirus, and the phase-out of our 3G-based cellular devices in the U.S., Track Group stands resilient. The demonstrated financial growth evidenced in Q2 FY25 reinforces our confidence in the strategic reinvestment in technology and the implementation of new programs initiated in late FY24. These endeavors position us well for a sustained return to growth throughout FY25. Our outlook for FY25 is as follows: 

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, and 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 OTCQB exchange. For more information, visit www.trackgrp.com. 

Forward-Looking Statements

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 Track Group, Inc., and subsidiaries (“Track Group”) are intended to identify such forward-looking statements. These statements are only predictions and reflect Track Group’s current beliefs and expectations with respect to future events and are based on assumptions and subject to risks and uncertainties and subject to change at any time. Track Group 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 Track Group’s 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. New risks emerge from time to time. 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.

Non-GAAP Financial Measures

This release includes financial measures defined as “non-GAAP financial measures” by the Securities and Exchange Commission including non-GAAP EBITDA. These measures may be different from non- GAAP financial measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles. Reconciliations of these non-GAAP financial measures are based on the financial figures for the respective period.

Non-GAAP Adjusted EBITDA excludes items included but not limited to interest, taxes, depreciation, amortization, impairment charges, gains and losses, currency effects, one-time charges or benefits that are not indicative of operations, charges to consolidate, integrate or consider recently acquired businesses, costs of closing facilities, stock based or other non-cash compensation or other stated cash and non-cash charges (the “Adjustments”).

The Company believes the non-GAAP measures provide useful information to both management and investors when factoring in the Adjustments. Specific disclosure regarding the Company’s financial results, including management’s analysis of results from operations and financial condition, are contained in the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2023, and other reports filed with the Securities and Exchange Commission. Investors are encouraged to carefully read and consider such disclosure and analysis contained in the Company’s Form 10-K and other reports, including the risk factors contained in such Form 10-K.

James Berg
Chief Financial Officer
jim.berg@trackgrp.com