Datatrak International, Inc. Reports Second Quarter Results of 2019

CLEVELAND, August 14 /PRNewswire/ – Datatrak International, Inc. (OTC Markets: DTRK), a worldwide software-as-a-service provider and innovation leader of cloud-based technologies for the life sciences industry, today announced its operating results for the second quarter of 2019.

Financial Highlights:

Datatrak achieved its fifth consecutive quarter of profitability and saw an increase in backlog during the six months ended June 30, 2019.  Revenue for the second quarter of 2019 was $1,884,000 compared to $1,931,000 for the second quarter of 2018.  Direct costs increased $61,000 for the three months ended June 30, 2019 compared to the three months ended June 30, 2018 due to new employees hired in the third quarter of 2018.  The Company’s gross profit margin was 80% for the second quarter of 2019 compared to 83% for the second quarter of 2018.  SG&A expenses decreased slightly to $1,280,000 for the three months ended June 30, 2019 compared to $1,282,000 for the three months ended June 30, 2018.  Depreciation and amortization increased for the second quarter of 2019 to $194,000 compared to $168,000 for the second quarter of 2018, due to capitalized software development that was released into production.  As a result of the items discussed, Datatrak had income from operations for the three months ended June 30, 2019 of $28,000 compared to $159,000 for the three months ended June 30, 2018.  After other income of $2,000 for the second quarter of 2019 and $1,000 for the second quarter of 2018, the Company’s net income for the three months ended June 30, 2019 was $30,000 compared to $160,000 for the three months ended June 30, 2018.

 

Revenue increased for the six months ended June 30, 2019 by $120,000, to $3,806,000 compared to $3,686,000 for the six months ended June 30, 2018.  Direct costs increased $63,000 for the six months ended June 30, 2019 compared to the six months ended June 30, 2018 due to new employees hired in the third quarter of 2018.  The Company’s gross margin was 81% for the six months ended June 30, 2019 compared to a gross margin of 82% for the six months ended June 30, 2018.  SG&A expenses decreased by $156,000, or 6%, for the six months ended June 30, 2019 compared to the six months ended June 30, 2018.  The decrease in SG&A expenses was driven by lower employee expenses and lower legal costs and was partially offset by higher director fees.  Depreciation and amortization also increased for the six months ended June 30, 2019 to $385,000 compared to $317,000 for the six months ended June 30, 2018, due to capitalized software development that was released into production.  As a result of the items discussed, Datatrak had income from operations of $193,000 and $48,000 for the six months ended June 30, 2019 and 2018, respectively.  After other income of $4,000 for the six months ended June 30, 2019 and $2,000 for the six months ended June 30, 2018, the Company’s net income for the six months ended June 30, 2019 was $197,000 compared to $50,000 for the six months ended June 30, 2018.

 

Datatrak’s backlog at June 30, 2019 was $16.2 million compared to a backlog of $15.3 million at December 31, 2018, which is a 6% increase. Backlog consists of future value from authorization letters to commence services, statements of work, technology and services agreements, change orders and other customer contracts, billed and unbilled.

 

All contracts are subject to possible delays or cancellation or can change in scope in a positive or negative direction. Therefore, current backlog is not necessarily indicative of the Company’s future quarterly or annual revenue. Historically, backlog has not always been an accurate predictor of the Company’s short-term revenue.

 

Executive Highlights:

Datatrak continues to expand the functionality of its Enterprise Cloud Platform with the announcement of Datatrak Direct, a development platform to collect ePRO, eCOA and eConsent data directly from patients. 

“With the addition of Datatrak Direct, we continue to expand our capabilities of putting the power of design and site, lab, patient and wearable device data capture in the hands of our clients.  Datatrak Direct, along with our new Endpoint Adjudication workflows for safety events and imaging, gives our clients the ability to conduct their trials within a central vendor platform for all data capture, management and Business Intelligence needs,” said Scott DeMell, VP of Sales at Datatrak. “Providing our clients a streamlined approach to contracting, training, implementing and executing their eClinical systems enables them to have more time to concentrate on their pipeline and getting their products to market faster.”

In June 2019, Datatrak showcased the entire suite of unified products in its Enterprise Cloud Platform at the annual DIA meeting in San Diego. “With our user-group speaking engagements in Japan, Business Intelligence presentation at the DIA 2019 meetings in China and client demonstrations at the DIA meetings in the U.S., we continue to receive support from our current and prospective clients on the new Datatrak products and our commitment to innovation.  The old best of breed, integrated models no longer meet today’s global challenges,“ said Jim Bob Ward, CEO and President at Datatrak.  “We are seeing an increased demand in the U.S., EU and APAC regions for fully translated eClinical solutions delivered through cloud-based platforms that not only manage the clinical data but also manage clinical teams.” 

Scott DeMell stated, “Several recent acquisitions in our market validate the move to SaaS platforms like Microsoft Azure or Amazon AWS, which can be modified to meet the increasingly complex needs in clinical research today. As the first EDC company, and the first SaaS cloud platform, in the industry, we believe Datatrak is uniquely positioned with our Enterprise Cloud platform to meet these needs with information segregation based on study teams and the ability to turn on and off products and features based on each trial specification. Our clients can use our technology to not only manage their current trials and trial teams, but to gain better insight into their data via our Business Intelligence tools which should assist in future research and product development.”

Datatrak will be presenting its Datatrak Direct, Image and Safety Adjudication, Business Intelligence and the rest of the Enterprise Cloud Platform at the upcoming SCDM 2019 Annual Conference September 29th through October 2nd in Baltimore, Maryland.

 

Join Datatrak thought leaders:

 

 

About Datatrak International, Inc.

 

Datatrak International, Inc. is a software-as-a-service provider of enterprise cloud-based technologies for the life sciences industry.  Datatrak’s unified eClinical solutions and related services help improve cost and time efficiencies for the clinical trials industry. Datatrak built its multi-component, comprehensive solution on a single, unified platform and expanded this concept to include services delivery via Datatrak’s Clinical and Consulting Services group. The Company delivers a complete portfolio of software products designed to accelerate the reporting of clinical research data from sites to sponsors and ultimately regulatory authorities, faster and more efficiently than loosely integrated technologies. The Datatrak Enterprise Cloud software solution, deployed worldwide through an ASP or Enterprise Transfer offering, supports Preclinical and Phase I – Phase IV drug and device studies in multiple languages throughout the world. Datatrak is located in Cleveland, Ohio and College Station, Texas.  For more information, visit http://www.datatrak.com.

 

Except for the historical information contained in this press release, the statements made in this release are forward-looking statements. These forward-looking statements
are made based on management’s expectations, assumptions, estimates and current beliefs concerning the operations, future results and prospects of the Company and are subject to uncertainties and factors which are difficult to predict and, in many instances, are beyond the control of the Company, and which could cause actual results to differ materially from those contemplated in these forward-looking statements. All statements that address operating performance, events or developments that management anticipates will occur in the future, including statements related to future revenue, profits, expenses, cost reductions, cash management alternatives and working capital requirements, release of new products, market share, strategic alternatives, raising additional funds, income and earnings per share or statements expressing general opinion about future results, are forward-looking statements.  For a list of certain factors that may cause actual results to differ materially from those contemplated in these forward looking statements, please see the Company’s report filed with the OTC Markets on March 21, 2019 announcing its results for the full-year period ended December 31, 2018 and subsequent filings with the OTC Markets. The Company undertakes no obligation to update publicly or revise any forward-looking statement whether as a result of new information, future events or otherwise.

 

Contacts:

Sales: Scott DeMell                                        Employment Opportunities: Laura Stuebbe

Scott.DeMell@datatrak.com                         Laura.Stuebbe@datatrak.com

 

Shareholders: Alex Tabatabai

investor@datatrak.com  

 

 

 

Datatrak International, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet Data

 (Unaudited)

 

 

June 30, 2019 December 31, 2018
Cash and cash equivalents $1,825,434 $2,349,348
Marketable securities 6,972 8,230
Certificate of deposit 165,057 225,235
Accounts receivable, net 2,918,771 838,389
Operating right-of-use asset, net 1,990,474               —
Property & equipment, net 1,455,644 1,408,827
Other      503,472      447,483
   Total assets $8,865,824 $5,277,512
Accounts payable and other current liabilities $1,114,535 $1,101,254
Deferred revenue 4,685,142 3,520,065
Other long-term liabilities 2,197,407 151,359
Shareholders’ equity     868,740     504,834
   Total liabilities and shareholders’ equity $8,865,824 $5,277,512
 

 

Datatrak International, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

 

 

For the 3 Months Ended June 30,
                       2019                        2018
Revenue $1,883,567 $1,931,340
Direct costs     381,607     321,112
   Gross profit 1,501,960 1,610,228
Selling, general and administrative expenses 1,279,818 1,282,492
Depreciation and amortization     193,755     168,346
   Income from operations 28,387 159,390
Interest income 3,819 746
Interest expense          (1,220)          (1,044)
Other income (expense)          (645)         1,000
   Net income before tax provision $    30,341 $  160,092
Tax provision              —               —
   Net income $    30,341 $  160,092
     Net income per share:    
          Net income per share, basic $        0.01 $        0.07
          Weighted-average shares outstanding, basic  2,343,924  2,296,887
          Net income per share, diluted $        0.01 $        0.07 
          Weighted-average shares outstanding, diluted  2,374,456  2,326,173
Datatrak International, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

 

 

For the 6 Months Ended June 30,
                       2019                        2018
Revenue $3,805,675 $3,685,653
Direct costs     732,867     669,726
   Gross profit 3,072,808 3,015,927
Selling, general and administrative expenses 2,495,039 2,650,993
Depreciation and amortization     384,709    317,370
   Income from operations 193,060 47,564
Interest income 6,568 1,642
Interest expense          (1,569)          (1,439)
Other income (expense)       (1,317)        2,600
   Net income before tax provision $  196,742 $   50,367
Tax provision              —             —
   Net income $  196,742 $   50,367
     Net income per share:    
          Net income per share, basic $        0.08 $        0.02
          Weighted-average shares outstanding, basic  2,337,154  2,289,231
          Net income per share, diluted $        0.08 $        0.02
          Weighted-average shares outstanding, diluted  2,368,200  2,310,287