National Research Corporation Announces Fourth Quarter and Calendar Year 2021 Results

Rhea-AI Summary

National Research Corporation (NASDAQ:NRC) reported strong Q4 2021 results, with a 10% revenue increase to $38.3 million and a 26% operating income rise to $12.9 million, resulting in an operating margin of 34%. For the full year, revenue was $148.0 million (+11%) and operating income was $50.3 million (+18%). Diluted EPS increased to $0.38 in Q4 and $1.46 for the year. The launch of the Human Understanding Program aims to enhance personalized care across healthcare systems. The company's cash flow from operations grew to $46.3 million, boosting net cash to $27.8 million.

Positive

• Revenue for Q4 2021 increased by 10% to $38.3 million.
• Operating income rose by 26% to $12.9 million in Q4 2021.
• Annual revenue for 2021 increased by 11% to $148.0 million.
• Operating income for 2021 increased by 18% to $50.3 million.
• Diluted earnings per share rose to $0.38 in Q4 and $1.46 for the year.
• Cash flow from operations increased to $46.3 million, up from $40.6 million.

Negative

• None.

LINCOLN, Neb., Feb. 08, 2022 (GLOBE NEWSWIRE) -- National Research Corporation (NASDAQ:NRC) today announced results for the fourth quarter of 2021.

Q4 2021 financial results compared to Q4 2020:

• Revenue increased 10% to $38.3 million
• Operating Income increased 26% to $12.9 million
• Operating Income margin increased to 34% of revenue, up from 29%
  

Calendar year 2021 results compared to 2020:

• Revenue increased 11% to $148.0 million
• Operating Income increased 18% to $50.3 million
• Operating Income margin increased to 34% of revenue, up from 32%
  

In commenting on events at year-end, Michael Hays, Chief Executive Officer, said “I’m pleased to announce the launch of NRC’s Health’s Human Understanding Program as a major extension to our offerings. Our Human Understanding Program enables health systems to deliver personalized care at scale, resulting in each patient being treated as a unique person, a long sought-after outcome. As part of the Program’s launch, we benchmarked the extent to which care is being personalized at every major healthcare organization in the 200 largest U.S. markets. This study documented patients being treated as unique reported an amazingly high Net Promotor Score of 82, while patients not treated as such resulted in an extremely low Net Promotor Score of negative 50.”

In closing, Mr. Hays offered an invitation to join the upcoming earnings call to learn more about the Human Understanding Program’s launch.

Regarding the Company’s fourth quarter financial performance, Kevin Karas, Chief Financial Officer, said, “We are pleased with our solid fourth-quarter results and the continuation of our strong performance for this year. 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. As a result, we continued to achieve double-digit revenue and operating income growth rates, as well as continued margin expansion. We also utilized our strong cash flow from operations to continue our quarterly dividend and fund share repurchases in the fourth quarter.”

Revenue for the quarter ended December 31, 2021, was $38.3 million, compared to $34.8 million for the same quarter in 2020. Net income for the quarter ended December 31, 2021, was $9.6 million, compared to $8.2 million for the quarter ended December 31, 2020.

Diluted earnings per share increased to $0.38 for the quarter ended December 31, 2021, from diluted earnings per share of $0.32 for the quarter ended December 31, 2020.

For calendar year 2021, revenue increased by 11% to $148.0 million, compared to $133.3 million in 2020. Operating income in 2021 increased by 18%, from $42.7 million in 2020 to $50.3 million in 2021. Diluted earnings per share increased to $1.46 for the year ended December 31, 2021, from diluted earnings per share of $1.45 for the year ended December 31, 2020.

Cash Flow from Operations was $46.3 million up from $40.6 million, leaving us with a Net Cash position (Cash minus Notes Payable) of $27.8 million, up from $4.1 million at year end 2020.

A live simulcast of National Research Corporation’s 2021 fourth quarter and year-end conference call will be available online at https://events.q4inc.com/attendee/203117621 on February 9, 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, 2020 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,
		2021				2020				2021				2020
Revenue	$	38,298			$	34,774			$	147,954			$	133,277
Insurance Recoveries		-				-				-				533
Operating expenses:
Direct expenses		14,167				12,818				52,350				49,187
Selling, general and administrative		9,901				8,887				38,960				34,441
Depreciation and amortization		1,357				2,882				6,374				7,505
Total operating expenses		25,425				24,587				97,684				91,133
Operating income		12,873				10,187				50,270				42,677
Other income (expense):
Interest income		4				3				14				18
Interest expense		(399	)			(447	)			(1,667	)			(1,813	)
Other, net		13				131				4				585
Total other expense		(382	)			(313	)			(1,649	)			(1,210	)
Income before income taxes		12,491				9,874				48,621				41,467
Provision for income taxes		2,858				1,662				11,155				4,207
Net income	$	9,633			$	8,212			$	37,466			$	37,260
Earnings Per Share of Common Stock:
Basic Earnings Per Share	$	0.38			$	0.32			$	1.47			$	1.48
Diluted Earnings Per Share	$	0.38			$	0.32			$	1.46			$	1.45
Weighted average shares and share equivalents outstanding
Basic		25,419				25,337				25,422				25,170
Diluted		25,597				25,684				25,640				25,696

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

	December 31, 2021				December 31, 2020
Assets
Current assets:
Cash and cash equivalents	$	54,361			$	34,690
Accounts receivable, net		13,728				13,923
Income taxes receivable		752				1,235
Other current assets		4,866				4,264
Total current assets		73,707				54,112
Property and equipment, net		12,391				11,726
Goodwill		61,614				57,255
Other, net		9,828				10,330
Total assets	$	157,540			$	133,423
Liabilities and Shareholders’ Equity
Current liabilities:
Current portion of notes payable, net unamortized debt issuance costs	$	4,278			$	4,061
Accounts payable and accrued expenses		7,393				4,279
Accrued compensation		7,139				6,460
Deferred revenue		17,213				15,585
Other current liabilities		1,321				1,296
Dividends payable		3,044				--
Total current liabilities		40,388				31,681
Notes payable, net of current portion and unamortized debt issuance costs		22,269				26,547
Other non-current liabilities		9,546				10,880
Total liabilities		72,203				69,108
Shareholders’ equity:
Preferred stock, $0.01 par value, authorized 2,000,000 shares, none issued		--				--
Common stock, $0.001 par value; authorized 110,000,0000 shares in 2021 and 60,000,000 shares in 2020, issued 30,898,600 in 2021 and 30,775,154 in 2020, outstanding 25,361,409 in 2021 and 25,390,968 in 2020		31				31
Additional paid-in capital		173,942				171,785
Retained earnings (accumulated deficit)		(36,112	)			(61,375	)
Accumulated other comprehensive loss, foreign currency translation adjustment		(2,375	)			(2,399	)
Treasury stock		(50,149	)			(43,727	)
Total shareholders’ equity		85,337				64,315
Total liabilities and shareholders’ equity	$	157,540			$	133,423

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

FAQ

What were National Research Corporation's Q4 2021 revenue results?

National Research Corporation reported Q4 2021 revenue of $38.3 million, a 10% increase from Q4 2020.

How did NRC's operating income change in Q4 2021?

Operating income for NRC increased by 26% to $12.9 million in Q4 2021.

What was the diluted earnings per share for NRC in Q4 2021?

Diluted earnings per share for NRC increased to $0.38 in Q4 2021.

What is the Human Understanding Program launched by NRC?

The Human Understanding Program is designed to enhance personalized care in healthcare systems.

How much cash flow from operations did NRC report for 2021?

NRC reported cash flow from operations of $46.3 million for the year 2021.