EX-99.1 2 ex_120987.htm EXHIBIT 99.1 ex_120987.htm

Exhibit 99.1

1245 “Q” Street

Lincoln, NE 68508

Phone: 402-475-2525

Fax: 402-475-9061

 

 

Contact:

Kevin R. Karas

Chief Financial Officer

402-475-2525

 

 

NATIONAL RESEARCH CORPORATION ANNOUNCES

SECOND QUARTER 2018 RESULTS

 

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

 



LINCOLN, Nebraska (August 7, 2018) — 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.

 

 

 

NRC Announces Second Quarter 2018 Results

Page 2

August 7, 2018

 

 

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.

 

 

 

NRC Announces Second Quarter 2018 Results

Page 3

August 7, 2018

 

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  

 

 

 

NRC Announces Second Quarter 2018 Results

Page 4

August 7, 2018

 

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  

 

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