EX-99.1 2 cmw3112a.htm PRESS RELEASE

Contact: Patrick E. Beans
Chief Financial Officer
402-475-2525

NATIONAL RESEARCH CORPORATION ANNOUNCES
THIRD QUARTER 2007 RESULTS AND FOURTH QUARTER DIVIDEND

Company Reports Record Revenue and Earnings

LINCOLN, Nebraska (November 6, 2007) — National Research Corporation (NASDAQ:NRCI) today announced results for the third quarter ended September 30, 2007.

  • Quarterly revenue increased by 5%
  • Quarterly net income increased by 7%
  • Quarterly diluted earnings per share of $0.36
  • Quarterly net new contracts of $2.5 million

        Commenting on the third quarter results, Michael D. Hays, chief executive officer of National Research Corporation, said, “Posting record revenue and earnings is a great achievement and we’re always pleased to exceed EPS estimates. However, our revenue growth rate is not at plan given our 20% plus increase in commercial contract value has gone towards replacing government sector revenues. Once that has been worked through, I personally feel our performance will be more rewarding.”

        Revenue for the quarter ended September 30, 2007, was $14.0 million, compared to $13.3 million for the same period in 2006. Net income for the quarter ended September 30, 2007, was $2.5 million, or $0.36 per basic and diluted earnings per share, compared with net income of $2.3 million, or $0.34 per basic and diluted earnings per share, in the prior year period.

        Revenue for the nine months ended September 30, 2007, increased 14% to $38.1 million, compared to $33.5 million for the same period in 2006. Net income for the nine months ended September 30, 2007, increased 17% to $5.7 million, resulting in $0.84 per basic and $0.82 per diluted earnings per share, up 18% and 17%, respectively, over the same period in 2006.

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NRCI Announces Third Quarter Results
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November 6, 2007

        In closing, Patrick E. Beans, chief financial officer of National Research Corporation, said, “Even with the modest revenue growth in the third quarter 2007, period over period we exceeded our operating and net income targets placing our year-to-date net income of 15% right at model. The continual growth in higher margin subscription-based products is clearly benefiting the Company.”

        The Company also announced that its Board of Directors has declared a regular quarterly cash dividend of $0.12 (twelve cents) per share payable December 31, 2007, to shareholders of record as of the close of business on December 17, 2007.

        A listen-only simulcast of National Research Corporation’s year-end conference call will be available online at www.earnings.com on November 7, 2007, beginning at 11:00 a.m. Eastern time. The online replay will follow approximately an hour later and continue for 30 days.

        National Research Corporation, headquartered in Lincoln, Nebraska, is a leading provider of performance measurement, improvement services, and governance education to the healthcare industry in the United States and Canada.

        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.





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NRCI Announces Third Quarter Results
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November 6, 2007

NATIONAL RESEARCH CORPORATION
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)

Three Months Ended
September 30,
 Nine Months Ended
September 30,
2007
 2006
 2007
 2006

Revenue		     $ 13,952   $ 13,313   $ 38,102   $ 33,453  

Operating expenses:		  
    Direct expenses    5,930    5,761    16,744    14,841  
    Selling, general and administrative    3,240    2,960    9,890    9,009  
    Depreciation and amortization    672    600    1,922    1,570  
        Total operating expenses    9,842    9,321    28,556    25,420  

        Operating income		    4,110    3,992    9,546    8,033  

Other income (expense):		  
    Interest income    32    18    101    156  
    Interest expense    (110 )  (225 )  (413 )  (317 )
    Other, net    21    7    88    (17 )

        Total other income (expense)		    (57 )  (200 )  (224 )  (178 )

        Income before income taxes		    4,053    3,792    9,322    7,855  
        Provision for income taxes    1,558    1,450    3,592    2,977  

Net income		   $ 2,495   $ 2,342   $ 5,730   $ 4,878  

Net income per share, basic		   $ 0.36   $ 0.34   $ 0.84   $ 0.71  
Net income per share, diluted   $ 0.36   $ 0.34   $ 0.82   $ 0.70  

Weighted average shares outstanding:		  
    Basic    6,851    6,845    6,846    6,836  
    Diluted    7,013    6,986    6,995    6,951  


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NRCI Announces Third Quarter Results
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November 6, 2007

NATIONAL RESEARCH CORPORATION
Consolidated Condensed Balance Sheets
(Dollars in thousands)

Sept. 30,
2007
 Dec. 31,
2006
ASSETS (Unaudited)
Current Assets:            
    Cash and cash equivalents   $ 2,059   $ 876  
    Short-term investments    497    1,110  
    Accounts receivable, net    10,136    6,734  
    Income taxes recoverable    --    898  
    Other current assets    2,425    3,379  
           Total current assets    15,117    12,997  

Net property and equipment		    11,523    11,716  
Other, net    37,401    36,819  

           Total Assets		   $ 64,041   $ 61,532  

LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:  
    Accounts payable and accrued expenses   $ 1,333   $ 1,511  
    Deferred revenue    10,535    8,264  
    Accrued compensation    1,692    1,594  
    Income taxes payable    843    --  
    Notes payable    1,036    3,110  
           Total current liabilities    15,439    14,479  

Non-current liabilities		    6,988    10,303  

           Total Liabilities		    22,427    24,782  

Shareholders’ Equity:		  
    Common stock, $0.001 par value; 20,000,000 shares authorized;  
      issued 7,878,506 in 2007 and 7,837,848 in 2006;  
      outstanding 6,923,894 in 2007 and 6,890,631 in 2006    8    8  
    Additional paid-in capital    23,078    21,820  
    Retained earnings    29,726    26,488  
    Accumulated other comprehensive income    907    358  
    Treasury stock    (12,105 )  (11,924 )
           Total shareholders’ equity    41,614    36,750  
           Total liabilities and shareholders’ equity   $ 64,041   $ 61,532  

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