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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, net13,112  13,728 
Other current assets5,694  5,618 
Total current assets51,780  73,707 
      
Property and equipment, net13,602  12,391 
Goodwill61,614  61,614 
Other, net9,237  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 expenses4,973  7,393 
Accrued compensation6,914  7,139 
Deferred revenue15,496  17,213 
Dividends payable5,944  3,044 
Other current liabilities1,870  1,321 
Total current liabilities39,587  40,388 
      
Notes payable, net of current portion and unamortized debt issuance costs20,044  22,269 
Other non-current liabilities7,978  9,546 
Total liabilities67,609  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 202131  31 
Additional paid-in capital174,561  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’ equity68,624  85,337 
Total liabilities and shareholders’ equity$136,233  $157,540 
        

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