National Research Corporation Announces Fourth Quarter and Calendar Year 2022 Results

Rhea-AI Summary

National Research Corporation (NRC) reported 7% year-over-year revenue growth for 2022, driven by its Human Understanding Program. The company added notable clients like St. Bernards Healthcare and received the Best in KLAS 2023 Award for Patient Experience Improvement. However, revenue growth was partially offset by the phase-out of Canadian operations. For 2022, NRC allocated $12.2 million for innovation, $21.0 million for dividends, and $27.6 million for share repurchases. Diluted earnings per share fell to $1.27 for the year from $1.46 in 2021, highlighting financial challenges amidst strategic investments.

Positive

• 7% year-over-year revenue growth attributed to core offerings.
• Successful adoption of the Human Understanding Program with new clients.
• Recognition with the Best in KLAS 2023 Award for Patient Experience Improvement.
• Significant capital allocation for innovation and growth initiatives.

Negative

• Diluted earnings per share decreased to $1.27 from $1.46 in 2021.
• Revenue growth partially offset by phase-out of Canadian operations.

LINCOLN, Neb., Feb. 14, 2023 (GLOBE NEWSWIRE) -- National Research Corporation, dba NRC Health, (NASDAQ:NRC) today announced results for the fourth quarter and calendar year 2022.

Regarding the Company’s 2022 annual performance, Kevin Karas, Chief Financial Officer, said, “We continued to grow revenue from core offerings, including our Human Understanding Program, resulting in 7% year-over-year revenue growth, partially offset by the phase out of our Canadian operations and other non-core offerings. Adoption of the Human Understanding Program has continued to increase with recent new client additions including St. Bernards Healthcare, Longstreet Clinic, and Legacy Community Health. In addition, we are proud to have recently received the Best in KLAS 2023 Award for Patient Experience Improvement. This recognition affirms our leadership position and focus on transforming the healthcare industry with a human-first approach.”

The Company’s Board of Directors maintained its capital allocation priorities of funding innovation and growth investments, including merger and acquisition activity as well as internal projects, shareholder dividends and share repurchases during 2022. For the full year, the Company funded $12.2 million for innovation and growth, $21.0 million for dividend payments, and $27.6 million for share repurchases.

Related to the fourth quarter ended December 31, 2022, other expense increased primarily due to a $2.6 million reclassification of the cumulative translation adjustment into earnings from the substantial liquidation of our investment in our Canadian subsidiary.

Diluted earnings per share decreased to $0.27 for the quarter ended December 31, 2022, from diluted earnings per share of $0.38 for the quarter ended December 31, 2021. Diluted earnings per share decreased to $1.27 for the year ended December 31, 2022, from diluted earnings per share of $1.46 for the year ended December 31, 2021.

A live simulcast of National Research Corporation’s 2022 fourth quarter conference call will be available online at https://events.q4inc.com/attendee/759565253 on February 15, 2023, 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, NRC Health (NASDAQ: NRC) has led the charge to humanize healthcare and support organizations in their understanding of each unique individual. NRC Health’s commitment to Human Understanding® helps leading healthcare systems get to know each person they serve not as point-in-time insights, but as an ongoing relationship. Guided by its uniquely empathic heritage, NRC Health’s patient-focused approach, unmatched market research, and emphasis on consumer preferences are transforming the healthcare experience, creating strong outcomes for patients and entire healthcare systems. For more information, email info@nrchealth.com, or visit www.nrchealth.com.

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 December 31								Twelve months ended December 31
		2022				2021				2022				2021
Revenue		$	38,144			$	38,298			$	151,568			$	147,954
Operating expenses:
Direct			13,987				14,167				57,049				52,350
Selling, general and administrative			10,541				9,901				42,699				38,960
Depreciation, amortization and impairment			1,375				1,357				5,277				6,374
Total operating expenses			25,903				25,425				105,025				97,684
Operating income			12,241				12,873				46,543				50,270
Other income (expense):
Interest income			134				4				168				14
Interest expense			(286	)			(399	)			(1,209	)			(1,667	)
Reclassification of cumulative translation into earnings			(2,569	)			--				(2,569	)			--
Other, net			(49	)			13				(118	)			4
Total other income (expense)			(2,770	)			(382	)			(3,728	)			(1,649	)
Income before income taxes			9,471				12,491				42,815				48,621
Provision for income taxes			2,830				2,858				11,015				11,155
Net income		$	6,641			$	9,633			$	31,800			$	37,466
Earnings Per Share of Common Stock:
Basic Earnings Per Share		$	0.27			$	0.38			$	1.28			$	1.47
Diluted Earnings Per Share		$	0.27			$	0.38			$	1.27			$	1.46
Weighted average shares and share equivalents outstanding:
Basic			24,648				25,419				24,922				25,422
Diluted			24,775				25,597				25,052				25,640

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

		December 31, 2022				December 31, 2021
Assets
Current assets:
Cash and cash equivalents		$	25,026			$	54,361
Accounts receivable, net			14,461				13,728
Other current assets			4,229				5,618
Total current assets			43,716				73,707
Property and equipment, net			17,248				12,391
Goodwill			61,614				61,614
Other, net			7,883				9,828
Total assets		$	130,461			$	157,540
Liabilities and Shareholders’ Equity
Current liabilities:
Current portion of notes payable, net unamortized debt issuance costs		$	4,491			$	4,278
Accounts payable and accrued expenses			5,136				7,393
Accrued compensation			4,551				7,139
Deferred revenue			15,198				17,213
Dividends payable			2,956				3,044
Other current liabilities			1,085				1,321
Total current liabilities			33,417				40,388
Notes payable, net of current portion and unamortized debt issuance costs			17,690				22,269
Other non-current liabilities			7,321				9,546
Total liabilities			58,428				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 30,922,181 in 2022 and 30,898,600 in 2021, outstanding 24,628,173 in 2022 and 25,361,409 in 2021			31				31
Additional paid-in capital			175,453				173,942
Retained earnings (accumulated deficit)			(25,184	)			(36,112	)
Accumulated other comprehensive loss, foreign currency translation adjustment			--				(2,375	)
Treasury stock			(78,267	)			(50,149	)
Total shareholders’ equity			72,033				85,337
Total liabilities and shareholders’ equity		$	130,461			$	157,540

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

 

FAQ

What were NRC's fourth quarter results for 2022?

NRC reported diluted earnings per share of $0.27 for Q4 2022, down from $0.38 in Q4 2021.

How much did NRC allocate for shareholder dividends in 2022?

NRC allocated $21.0 million for shareholder dividends in 2022.

What is the revenue growth percentage for NRC in 2022?

NRC achieved a 7% year-over-year revenue growth in 2022.

Who are some of NRC's new clients in 2022?

New clients added in 2022 include St. Bernards Healthcare, Longstreet Clinic, and Legacy Community Health.

What award did NRC receive in 2023?

NRC received the Best in KLAS 2023 Award for Patient Experience Improvement.