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Press Release

National Research Corporation Announces Second Quarter 2018 Results


Posted on: 07 Aug 18

Strong Market Adoption of Digital Voice of Customer (VOC) Platform

LINCOLN, Neb., Aug. 07, 2018 (GLOBE NEWSWIRE) -- National Research Corporation (NASDAQ:NRC) today announced results for the second quarter of 2018.

Digital VOC Platform highlights:

  • VOC contract value increased to $33 million
  • Year-to-date platform revenue increased to 23%, up from 11% year-over-year
  • Platform differentiation continues to drive new client sales activity

Remarking on Company performance, Michael D. Hays, chief executive officer of National Research Corporation said, “We ended the first half of the year exceeding the total dollar value of new client wins in all of 2017. Our VOC platform, combined with unmatched product extensions, is capturing the spend of legacy patient satisfaction vendors.”

Kevin Karas, chief financial officer commented, “Second quarter revenue decreased 1.5% from prior year in line with earlier visibility. We are expecting third quarter revenue growth in the 4% to 5% range compared to the third quarter of 2017 based on the trend in contract value growth.  It is important to note that second quarter results reflect the financial impact of the recapitalization that was approved by shareholders on April 16, 2018. The recapitalization impact included additional bank financing, legal fees, accelerated share-based compensation expense, income tax benefits, adjustments to shareholder’s equity and adjustments to the earnings-per-share calculation.”

Revenue for the quarter ended June 30, 2018, was $28.0 million, compared to $28.4 million for the same quarter in 2017. Net income for the quarter ended June 30, 2018, was $7.9 million, compared to $5.8 million for the quarter ended June 30, 2017. Diluted earnings per share increased to $0.28 for the common shares (formerly Class A) and decreased to $0.26 for Class B shares for the quarter ended June 30, 2018, from diluted earnings per share of $0.13 for Class A shares and $0.80 for Class B shares for the quarter ended June 30, 2017. Due to the recapitalization transaction on April 17, 2018, income has been allocated to both classes of shares through April 16, and allocated only to common stock (formerly Class A) after April 16. 

A listen-only simulcast of National Research Corporation’s 2018 second quarter conference call will be available online at http://edge.media-server.com/m6/p/2sqp4p7k on August 8, 2018, beginning at 11:00 a.m. Eastern time. The online replay will follow approximately one hour later and continue for 30 days.

For more than 37 years, National Research Corporation has been a leading provider of analytics and insights that facilitate measurement and improvement of the patient and employee experience while also increasing patient engagement and customer loyalty for healthcare providers, payers and other healthcare organizations in the United States and Canada.  The Company’s solutions enable its clients to understand the voice of the customer with greater clarity, immediacy and depth.

This press release includes “forward-looking” statements related to the Company that can generally be identified as describing the Company’s future plans, objectives or goals.  Such forward-looking statements are subject to risks and uncertainties that could cause actual results or outcomes to differ materially from those currently anticipated.  These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  For further information about the factors that could affect the Company’s future results, please see the Company’s filings with the Securities and Exchange Commission.

 

NATIONAL RESEARCH CORPORATION AND SUBSIDIARY
Unaudited Condensed Consolidated Statements of Income
(In thousands, except per share data)

 Three months ended
   June 30,    
 Six months ended
   June 30,    
    2018    2017     2018   2017 
              
Revenue$  28,017  $  28,435  $  59,034  $  58,710 
     
Operating expenses:    
Direct expenses 10,996   11,939     23,904     24,439 
Selling, general and administrative 7,940   6,905   15,808     13,591 
Depreciation and amortization   1,325     1,139      2,608       2,244 
Total operating expenses   20,261     19,983     42,320     40,274 
                  
Operating income 7,756   8,452   16,714   18,436 
     
Other income (expense):    
Interest income 9   15   54   29 
Interest expense (439)  (23)  (447)  (50)
Other, net   493   27     464     35 
                    
Total other income (expense)   63     19     71     14 
                    
Income before income taxes 7,819   8,471   16,785   18,450 
     
Provision (benefit) for income taxes   (129)    2,719     1,531     6,178 
                    
Net income$  7,948  $  5,752  $  15,254  $  12,272 
                    
Earnings Per Share of Common Stock:    
Basic Earnings Per Share:    
Common (formerly Class A)$    0.29  $    0.14  $  0.47  $  0.29 
Class B$    0.27  $    0.82  $  1.31  $  1.75 
Diluted Earnings Per Share:                   
Common (formerly Class A)$  0.28  $  0.13  $  0.45  $  0.28 
Class B$  0.26  $  0.80  $  1.27  $  1.71 
                    
Weighted average shares and share equivalents outstanding                   
Common (formerly Class A) - basic   23,957     20,752     22,429     20,745 
Class B - basic   3,527      3,514     3,527     3,514 
Common (formerly Class A) - diluted   24,846     21,525     23,350     21,404 
Class B - diluted   3,620     3,591     3,628     3,584 
                

 

  

NATIONAL RESEARCH CORPORATION AND SUBSIDIARY
Unaudited Condensed Consolidated Balance Sheets
(Dollars in thousands, except per share amounts and par value)

    Jun. 30,    Dec. 31, 
 2018  2017 
ASSETS       
Current Assets: 
Cash and cash equivalents$6,698  $34,733 
Accounts receivable, net 10,689   14,806 
Income taxes receivable 1,713   375 
Other current assets 4,533   2,345 
Total Current Assets 23,633   52,259 
        
Property and equipment, net 13,320   12,359 
Goodwill 57,913   58,021 
Deferred contract costs  3,369   -- 
Other, net 4,650   4,677 
Total Assets$102,885  127,316 
        
LIABILITIES AND SHAREHOLDERS’ EQUITY 
  
Current Liabilities: 
Accounts payable and accrued expenses$3,710   $3,546 
Deferred revenue 16,660   16,878 
Accrued compensation 4,669   6,597 
Dividends payable 4,206   4,222 
Income taxes payable 97   -- 
Notes payable 3,575   1,067 
Total Current Liabilities 32,917   32,310 
        
Non-Current Liabilities 43,151   4,965 
        
Total Liabilities 76,068   37,275 
  
Shareholders’ Equity: 
Preferred stock, $0.01 par value, authorized 2,000,000 shares, none issued --   --  
Common stock (formerly Class A Common stock) $0.001 par value; authorized 60,000,000 shares,
  issued 29,794,307 in 2018 and 25,835,230 in 2017, outstanding 24,783,983 in 2018 and 20,936,703 in 2017
 30   26 
Class B Common stock, $0.001 par value; 4,319,256 issued and 3,535,238 outstanding in 2017 --   4 
Additional paid-in capital 155,614   51,025 
Retained earnings (99,810  77,574 
Accumulated other comprehensive loss (2,333  (1,635)
Treasury stock (26,684  (36,953)
Total Shareholders’ Equity 26,817   90,041 
Total Liabilities and Shareholders’ Equity$102,885  127,316 
        

 

Contact:  
Kevin R. Karas  
Chief Financial Officer
402-475-2525

GlobeNewswire
globenewswire.com

Last updated on: 08/08/2018

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