National Research Corporation Announces Third Quarter 2015 Results

LINCOLN, Neb., Nov. 03, 2015 (GLOBE NEWSWIRE) — National Research Corporation (NASDAQ:NRCIA) (NASDAQ:NRCIB) today announced results for the third quarter of 2015.

  • Net New Sales $5.9 million
  • Total Contract Value $109.3 million
  • Revenue up 7% to $25.2 million
  • Net Income of $4.1 million

Remarking on Company performance, Michael D. Hays, chief executive officer of National Research Corporation said, “The market continues to validate the uniqueness of our product offerings accelerating our goal of distancing ourselves from traditional competitors. In addition to product investments, we are aggressively investing in talent, a great example of which being the recent promotion of Steve Jackson to President of NRC.”

Revenue for the quarter ended September 30, 2015, was $25.2 million, compared to $23.7 million for the same quarter in 2014. Net income for the quarter ended September 30, 2015, was $4.1 million, compared to $4.6 million for the same quarter in 2014. Diluted earnings per share decreased to $0.10 for Class A shares and $0.59 for Class B shares for the quarter ended September 30, 2015, from diluted earnings per share of $0.11 for Class A shares and $0.64 for Class B shares for the quarter ended September 30, 2014. Combined diluted earnings per share (a non-GAAP measure) decreased to $0.17 for the quarter ended September 30, 2015, from $0.19 for the third quarter of 2014.

Regarding third quarter performance, Kevin Karas, chief financial officer of National Research Corporation, said, “We are encouraged by the improved revenue growth in the third quarter as our net new sales growth from prior quarters translates into increased revenue.”

A listen-only simulcast of National Research Corporation’s 2015 third quarter conference call will be available online at http://edge.media-server.com/m/p/zwxoje6f on November 3, 2015, 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 34 years, National Research Corporation has been at the forefront of patient-centered care, helping healthcare providers measure and improve quality and services through analytics that offer a rich understanding of customers’ experiences, preferences, risks and behaviors across the healthcare continuum.

The information discussed within this release includes financial results and projections that are in accordance with accounting principles generally accepted in the United States (GAAP). In addition, certain non-GAAP financial measures have been provided that calculate combined earnings per share based on combined Class A and Class B shares and share equivalents outstanding, respectively. The non-GAAP measures should be read in conjunction with the corresponding GAAP measures and should be considered in addition to, and not as an alternative or substitute for, the measures prepared in accordance with GAAP. Please note that the Company’s non-GAAP measures may be different than those used by other companies.  The additional non-GAAP financial information the Company presents should be considered in conjunction with, and not as a substitute for, the Company’s financial information presented in accordance with GAAP.  The non-GAAP financial measures are provided in an effort to provide information that investors may deem relevant to evaluate results from the company’s core business operations and to compare the company’s performance with prior periods.  The company uses both GAAP and these non-GAAP financial measures for evaluating comparable financial performance against prior periods. 

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
   September 30,  
Nine months ended
  September 30,    
       2015        2014       2015       2014   
         
Revenue $   25,244         $   23,682   $   75,979   $   73,713  
         
Operating expenses:        
Direct expenses   11,006     9,769       33,246     30,871  
Selling, general and administrative   6,620     5,805     20,883     18,154  
Depreciation and amortization     1,070       949       3,109         2,810  
Total operating expenses     18,696             16,523       57,238         51,835  
         
Operating income   6,548      7,159     18,741     21,878  
         
Other income (expense):        
Interest income   14     22     46     58  
Interest expense   (52 )   (76 )   (172 )   (236 )
Other, net     (25 )     2       (22 )     16  
         
Total other expense     (63 )     (52 )     (148 )       (162 )
         
Income before income taxes   6,485     7,107     18,593     21,716  
         
Provision for income taxes     2,346       2,555       6,910       7,659  
         
Net income $   4,139   $   4,552   $   11,683   $   14,057  
         
Earnings Per Share of Common Stock:        
Basic Earnings Per Share:        
Class A $     0.10   $     0.11   $   0.28   $   0.34  
Class B $     0.59   $     0.66   $   1.67   $   2.03  
Diluted Earnings Per Share:        
Class A $   0.10   $   0.11   $   0.28   $   0.33  
Class B $   0.59   $   0.64   $   1.65   $   1.99  
         
Weighted average shares and share equivalents outstanding        
Class A – basic     20,726       20,771       20,769         20,761  
Class B – basic      3,478        3,474       3,478       3,472  
Class A – diluted     20,937       21,035       21,002       21,078  
Class B – diluted     3,521       3,536       3,522       3,538  

NATIONAL RESEARCH CORPORATION AND SUBSIDIARY
Unaudited Condensed Consolidated Balance Sheets
(Dollars in thousands, except per share amounts and par value)
     
  Sep. 30,   Dec. 31,
    2015     2014  
ASSETS
Current Assets:    
Cash and cash equivalents $   37,580   $   40,042  
Accounts receivable, net   12,889     8,116  
Income taxes receivable   723     1,100  
Assets held-for-sale   1,341      
Other current assets   3,534     3,930  
Total current assets   56,067     53,188  
     
Property and equipment, net   11,161     12,143  
Goodwill   57,867     58,489  
Other, net   4,381     5,690  
Total Assets $ 129,476   $ 129,510  
     
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:    
Accounts payable and accrued expenses $   6,449   $   6,028  
Deferred revenue   17,454     15,095  
Accrued compensation   4,730     4,365  
Income taxes payable       110  
Notes payable   2,383     2,328  
Liabilities held-for-sale   568      
Total Current Liabilities   31,584     27,926  
     
Non-current liabilities   11,302     13,836  
     
Total Liabilities   42,886     41,762  
     
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 25,538,056 in 2015 and 25,475,662 in 2014, outstanding 20,802,881 in 2015 and 20,894,286 in 2014   26     25  
Class B Common stock, $0.001 par value; authorized 80,000,000 shares, issued 4,262,287 in 2015 and 4,251,889 in 2014, outstanding 3,502,344 in 2015 and 3,494,865 in 2014   4     4  
Additional paid-in capital   43,335     44,864  
Retained earnings   77,826     73,686  
Accumulated other comprehensive loss   (2,570 )   (773 )
Treasury stock   (32,031 )   (30,058 )
Total shareholders’ equity   86,590     87,748  
Total liabilities and shareholders’ equity $ 129,476   $ 129,510  

NATIONAL RESEARCH CORPORATION AND SUBSIDIARY
Unaudited Non-GAAP Combined Earnings Per Share Schedule
(In thousands, except per share data) 
 
  Three months ended
   September 30,  
Nine months ended
  September 30,    
      2015        2014       2015       2014   
         
 

Combined Earnings Per Share

       
Basic Earnings Per Share $   0.17   $   0.19   $   0.48   $   0.58  
Diluted Earnings Per Share $   0.17   $     0.19   $   0.47   $   0.57  
                         
Combined weighted average shares and share equivalents outstanding                        
Combined – Basic     24,204        24,245       24,247       24,324  
Combined – Diluted      24,458        24,571       24,524       24,617  

 

 

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