National Research Corporation Announces First Quarter 2018 Results

Company Pivots Clients to Digital Voice of Customer (VOC) Platform

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| Source: National Research Corporation

LINCOLN, Neb., May 01, 2018 (GLOBE NEWSWIRE) -- National Research Corporation (NASDAQ:NRC) today announced results for the first quarter of 2018.

Digital VOC Platform highlights:

  • VOC contract value doubles to $29 million
  • Platform accounts for 21% of total first quarter revenue up from 10% year-over-year
  • Platform variable direct expense drops in half
  • Major back-to-back wins confirm emerging advantage at point of sale

Remarking on Company performance, Michael D. Hays, chief executive officer of National Research Corporation said, “The quarter is less about consolidated performance and all about our unwavering focus in migrating current clients to our digital VOC platform. Early results are ahead of my expectations and our point of sale advantage is becoming confirmed.”

Kevin Karas, chief financial officer commented, “The quarter was noisy driven by unique events including our recapitalization, adoption of the new revenue recognition standard, impact of the 2017 Tax Act and redirection of sales resources to convert existing clients to the digital platform.”

Revenue for the quarter ended March 31, 2018 was $31.0 million, compared to $30.3 million for the same quarter in 2017. Net income for the quarter ended March 31, 2018, was $7.3 million, compared to $6.5 million for the quarter ended March 31, 2017. Diluted earnings per share increased to $0.17 for Class A shares and $1.01 for Class B shares for the quarter ended March 31 2018, from diluted earnings per share of $0.15 for Class A shares and $0.91 for Class B shares for the quarter ended March 31, 2017.

A listen-only simulcast of National Research Corporation’s 2018 first quarter conference call will be available online at http://edge.media-server.com/m6/p/9zmhhi86 on May 2, 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
 March 31,
  2018   2017 
   
Revenue$  31,017  $  30,276 
   
Operating expenses:  
Direct 12,909   12,500 
Selling, general and administrative 7,867   6,686 
Depreciation and amortization   1,283     1,106 
Total operating expenses   22,059     20,292 
   
Operating income 8,958   9,984 
   
Other income (expense):  
Interest income 45   14 
Interest expense (8)  (27)
Other, net   (28)    9 
   
Total other income (expense)   9     (4)
   
Income before income taxes 8,967   9,980 
   
Provision for income taxes   1,661     3,459 
   
Net income$  7,306  $  6,521 
   
Earnings Per Share of Common Stock:  
Basic Earnings Per Share:  
Class A$    0.17  $    0.15 
Class B$    1.04  $    0.93 
Diluted Earnings Per Share:  
Class A$  0.17  $  0.15 
Class B$  1.01  $  0.91 
   
Weighted average shares and share equivalents outstanding       
Class A - Basic   20,884     20,737 
Class B - Basic    3,527      3,513 
Class A - Diluted   21,837     21,245 
Class B - Diluted    3,630      3,576 

 

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

 Mar. 31,
 Dec. 31,
 2018
 2017
ASSETS
Current Assets:  
Cash and cash equivalents$35,478  $34,733 
Accounts receivable, net 14,306   14,806 
Income taxes receivable 68   375 
Other current assets   2,426     2,345 
Total Current Assets 52,278   52,259 
        
Property and equipment, net 12,456   12,359 
Goodwill 57,956   58,021 
Deferred contract costs 3,571   -- 
Other, net 4,715   4,677 
Total Assets$ 130,976  $127,316 
   
LIABILITIES AND SHAREHOLDERS’ EQUITY
   
Current Liabilities:  
Accounts payable and accrued expenses3,893  $3,546 
Deferred revenue 16,965   16,878 
Accrued compensation 3,538   6,597 
Dividends payable 4,223   4,222 
Income taxes payable 865   -- 
Notes payable --  
 1,067 
Total Current Liabilities 29,484   32,310 
   
Non-Current Liabilities 6,128   4,965 
     
Total Liabilities 35,612   37,275 
     
Shareholders’ Equity:    
Preferred stock, $0.01 par value, authorized 2,000,000 shares, none issued    
Class A Common stock, $0.001 par value; authorized 60,000,000 shares, issued 25,916,792 in 2018 and 25,835,230 in 2017, outstanding 20,988,085 in 2018 and 20,936,703 in 2017  26    26 
Class B Common stock, $0.001 par value; authorized 80,000,000 shares, issued 4,328,552 in 2018 and 4,319,256 in 2017, outstanding 3,540,857 in 2018 and 3,535,238 in 2017 4    4 
Additional paid-in capital 52,216   51,025 
Retained earnings 83,392   77,574 
Accumulated other comprehensive loss (2,049)  (1,635
Treasury stock (38,225)  (36,953)
Total Shareholders’ Equity  95,364     90,041 
Total Liabilities and Shareholders’ Equity$ 130,976  $ 127,316 
Contact: Kevin R. Karas
Chief Financial Officer 
402-475-2525