National Research Corporation Announces Second Quarter 2022 Results

National Research Corporation Announces Second Quarter 2022 Results




National Research Corporation Announces Second Quarter 2022 Results

LINCOLN, Neb., Aug. 02, 2022 (GLOBE NEWSWIRE) — National Research Corporation, dba NRC Health, (NASDAQ:NRC) today announced results for the second quarter 2022.

Q2 2022 financial results compared to Q2 2021:

  • Revenue increased 2% to $37.3 million
  • Operating income decreased 6% to $11.5 million

In commenting on recent events, Michael Hays, Chief Executive Officer, said, “In the second quarter, our team secured the first official contract for the Human Understanding Program with Novant Health, an integrated health system serving four states and comprised of 15 medical centers and 600 clinics. We look forward to additional notable health systems adopting the Program which will take center stage at NRC Health’s 28th annual Symposium August 21–23 in Seattle. Hundreds of organizations will experience the power of delivering personalized health care at scale.”

Regarding the Company’s 2022 second quarter financial performance, Kevin Karas, Chief Financial Officer, said, “Our growth strategy continues to focus on organic growth levers of increasing revenue from our core offerings, including our new Human Understanding Program, within our existing client base, as well as adding new clients to increase market share. While growth in our core offerings remains strong, decreases in revenue from discontinued and non-core offerings reduced our consolidated revenue growth rate to 2% for the quarter. Consistent with our long-term focus, we increased resource allocation for innovation initiatives, marketing and associate retention, increasing operating expenses for the quarter. We also continued to follow our capital allocation strategy, funding our quarterly dividend and additional share repurchases in the second quarter.”

Revenue for the second quarter ended June 30, 2022, was $37.3 million, compared to $36.4 million for the same quarter in 2021. Net income for the quarter ended June 30, 2022, was $8.3 million, compared to $8.9 million for the quarter ended June 30, 2021.

Diluted earnings per share decreased to $0.33 for the quarter ended June 30, 2022, from diluted earnings per share of $0.35 for the quarter ended June 30, 2021.

A live simulcast of National Research Corporation’s 2022 second quarter conference call will be available online at https://events.q4inc.com/attendee/350372698 on August 3, 2022, 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 40 years, National Research Corporation has been a leading provider of analytics and insights that facilitate measurement and improvement to increase patient engagement and customer loyalty for healthcare providers, payers and other healthcare organizations in the United States and Canada. Our purpose is to enable human understanding by helping our clients to understand what matters most to each person that they serve.

This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. Such statements may be identified by their use of terms or phrases such as “believes,” “expect,” derivations thereof, and similar terms and phrases. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements, including those risks and uncertainties as set forth in the Risk Factors section of our Annual Report on Form 10-K for the year ended December 31, 2021 and various disclosures in our press releases, stockholder reports, and other filings with the Securities and Exchange Commission. We disclaim any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information.

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
 
  2022     2021     2022     2021  
                               
Revenue $ 37,292     $ 36,425     $ 75,734     $ 71,889  
                               
Operating expenses:                              
Direct   13,758       12,536       28,537       24,476  
Selling, general and administrative   10,748       10,016       21,397       19,536  
Depreciation, amortization and impairment   1,290       1,634       2,606       3,618  
Total operating expenses   25,796       24,186       52,540       47,630  
                               
Operating income   11,496       12,239       23,194       24,259  
                               
Other income (expense):                              
Interest income   14       3       19       6  
Interest expense   (318 )     (423 )     (635 )     (855 )
Other, net   (128 )     75       (81 )     96  
                               
Total other income (expense)   (432 )     (345 )     (697 )     (753 )
                               
Income before income taxes   11,064       11,894       22,497       23,506  
                               
Provision for income taxes   2,742       2,950       5,636       5,330  
                               
Net income $ 8,322     $ 8,944     $ 16,861     $ 18,176  
                               
Earnings Per Share of Common Stock:                              
Basic Earnings Per Share $ 0.33     $ 0.35     $ 0.67     $ 0.71  
Diluted Earnings Per Share $ 0.33     $ 0.35     $ 0.67     $ 0.71  
                               
Weighted average shares and share equivalents outstanding:                              
Basic   25,083       25,426       25,166       25,420  
Diluted   25,211       25,645       25,300       25,656  
                               

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

           
  June 30,
2022
    December 31,
2021
 
Assets          
Current assets:          
Cash and cash equivalents $ 32,974     $ 54,361  
Accounts receivable, net 13,112     13,728  
Other current assets 5,694     5,618  
Total current assets 51,780     73,707  
           
Property and equipment, net 13,602     12,391  
Goodwill 61,614     61,614  
Other, net 9,237     9,828  
Total assets $ 136,233     $ 157,540  
           
Liabilities and Shareholders’ Equity          
Current liabilities:          
Current portion of notes payable, net unamortized debt issuance costs $ 4,390     $ 4,278  
Accounts payable and accrued expenses 4,973     7,393  
Accrued compensation 6,914     7,139  
Deferred revenue 15,496     17,213  
Dividends payable 5,944     3,044  
Other current liabilities 1,870     1,321  
Total current liabilities 39,587     40,388  
           
Notes payable, net of current portion and unamortized debt issuance costs 20,044     22,269  
Other non-current liabilities 7,978     9,546  
Total liabilities 67,609     72,203  
           
Shareholders’ equity:          
Preferred stock, $0.01 par value, authorized 2,000,000 shares, none issued      
Common stock, $0.001 par value; authorized 110,000,000 shares, issued 30,898,600 in 2022 and 2021, outstanding 24,767,118 in 2022 and 25,361,409 in 2021 31     31  
Additional paid-in capital 174,561     173,942  
Retained earnings (accumulated deficit) (31,242 )   (36,112 )
Accumulated other comprehensive loss, foreign currency translation adjustment (2,423 )   (2,375 )
Treasury stock (72,303 )   (50,149 )
Total shareholders’ equity 68,624     85,337  
Total liabilities and shareholders’ equity $ 136,233     $ 157,540  
               

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