1245 “Q” Street
Lincoln, NE 68508
Phone: 402-475-2525
Fax: 402-475-9061
| Contact: | Patrick E. Beans Chief Financial Officer 402-475-2525 |
NATIONAL RESEARCH CORPORATION ANNOUNCES
FOURTH QUARTER AND YEAR-END 2005 RESULTS
Board of Directors Authorizes Increase in Quarterly Dividend
and Implementation of Stock Repurchase Program
LINCOLN, Nebraska (February 14, 2006) — National Research Corporation (NASDAQ/NM:NRCI), a leader in healthcare performance measurement, today announced results for the fourth quarter and year ended December 31, 2005.
The Company also announced that its Board of Directors has increased the Company’s regular quarterly cash dividend to $0.10 (ten cents) per share. The dividend is payable on March 31, 2006, to shareholders of record as of the close of business on March 10, 2006.
In addition, the Company’s Board of Directors has authorized the repurchase of up to 750,000 shares of the Company’s common stock. The repurchased shares will be added to the treasury shares of the Company and may be used for employee stock plans and other corporate purposes.
Commenting on the results, Michael D. Hays, chief executive officer of National Research Corporation, said, “Our fourth quarter performance provided for a strong finish to 2005. I am even more pleased that we began 2006 with a backlog of $37.7 million in recurring contract value, which is 28% greater than our starting point for 2005.”
Revenues for the quarter ended December 31, 2005, were $8.6 million compared with revenues of $6.4 million for the same period in 2004. Net income for the quarter ended December 31, 2005, was $1.5 million, or $0.22 per basic and diluted share, compared with net income of $921,000, or $0.13 per basic and diluted share, in the prior year period.
-MORE-
NRCI Announces Fourth Quarter and Year-End Results
Page 2
February 14, 2006
Revenues for the year ended December 31, 2005, were $32.4 million compared with revenues of $29.7 million for the same period in 2004. Net income for the year ended December 31, 2005, was $5.2 million, or $0.74 per basic and diluted share, compared with $4.6 million, or $0.63 per basic and diluted share, in the prior-year period.
In closing, Patrick E. Beans, chief financial officer of National Research Corporation, added, “Our sales expansion efforts are delivering top line growth, which, in concert with our history of fiscal discipline, speaks well for continuing earnings growth.”
A listen-only simulcast of National Research Corporation’s fourth quarter and year-end 2005 conference call will be available online atwww.earnings.com on February 15, 2006, beginning at 11:00 a.m. Eastern time. The online replay will follow approximately an hour later and continue for 30 days.
National Research Corporation, headquartered in Lincoln, Nebraska, is a leading provider of ongoing survey-based performance measurement, analysis, tracking and improvement services to the healthcare industry in the United States and Canada. The Company addresses the growing need of healthcare providers and payors to measure the care outcomes, specifically satisfaction and health status, of their patients and/or members. The Company develops tools that enable healthcare organizations to obtain performance measurement information necessary to improve their business practices.
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.
-MORE-
NRCI Announces Fourth Quarter and Year-End Results
Page 3
February 14, 2006
NATIONAL RESEARCH CORPORATION
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)
| Three Months Ended December 31, | Year Ended December 31, | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2005 | 2004 | 2005 | 2004 | |||||||||||
Revenues | $ | 8,558 | $ | 6,430 | $ | 32,436 | $ | 29,683 | ||||||
Operating expenses: | ||||||||||||||
| Direct expenses | 3,801 | 2,680 | 13,642 | 12,869 | ||||||||||
| Selling, general and administrative | 2,012 | 1,817 | 8,617 | 7,394 | ||||||||||
| Depreciation and amortization | 428 | 526 | 1,762 | 2,018 | ||||||||||
Total operating expenses | 6,241 | 5,023 | 24,021 | 22,281 | ||||||||||
Operating income | 2,317 | 1,407 | 8,415 | 7,402 | ||||||||||
Other income (expense): | ||||||||||||||
| Interest income | 120 | 96 | 488 | 345 | ||||||||||
| Interest expense | (76 | ) | (104 | ) | (380 | ) | (459 | ) | ||||||
| Other, net | -- | 32 | (9 | ) | (5 | ) | ||||||||
Total other income (expense) | 44 | 24 | 99 | (119 | ) | |||||||||
Income before income taxes | 2,361 | 1,431 | 8,514 | 7,283 | ||||||||||
| Provision for income taxes | 827 | 510 | 3,278 | 2,732 | ||||||||||
Net income | $ | 1,534 | $ | 921 | $ | 5,236 | $ | 4,551 | ||||||
Net income per share, basic | $ | 0.22 | $ | 0.13 | $ | 0.74 | $ | 0.63 | ||||||
| Net income per share, diluted | $ | 0.22 | $ | 0.13 | $ | 0.74 | $ | 0.63 | ||||||
Weighted average shares outstanding: | ||||||||||||||
| Basic | 6,921 | 7,142 | 7,038 | 7,181 | ||||||||||
| Diluted | 7,012 | 7,211 | 7,118 | 7,249 | ||||||||||
-MORE-
NRCI Announces Fourth Quarter and Year-End Results
Page 4
February 14, 2006
NATIONAL RESEARCH CORPORATION
Unaudited Consolidated Condensed Balance Sheets
(Dollars in thousands)
| Dec. 31, 2005 | Dec. 31, 2004 | |||||||
|---|---|---|---|---|---|---|---|---|
| ASSETS | ||||||||
Current Assets: | ||||||||
| Cash and cash equivalents | $ | 844 | $ | 3,648 | ||||
| Short-term investments | 9,452 | 15,348 | ||||||
| Accounts receivable, net | 5,495 | 3,392 | ||||||
| Other current assets | 2,427 | 3,066 | ||||||
| Total current assets | 18,218 | 25,454 | ||||||
Net property and equipment | 11,891 | 12,355 | ||||||
| Other, net | 14,438 | 10,145 | ||||||
Total Assets | $ | 44,547 | $ | 47,954 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 1,878 | $ | 851 | ||||
| Deferred revenue | 5,434 | 4,036 | ||||||
| Accrued compensation | 1,248 | 976 | ||||||
| Notes payable | 1,471 | 156 | ||||||
| Income taxes payable | -- | -- | ||||||
| Total current liabilities | 10,031 | 6,019 | ||||||
Non-current liabilities | 1,922 | 6,917 | ||||||
Total Liabilities | 11,953 | 12,936 | ||||||
Shareholders’ Equity: | ||||||||
| Common stock, $0.001 par value; 20,000,000 shares authorized; | ||||||||
| issued 7,740,571 in 2005 and 7,684,006 in 2004; | ||||||||
| outstanding 6,845,571 in 2005 and 7,174,706 in 2004 | 8 | 8 | ||||||
| Additional paid-in capital | 20,046 | 19,346 | ||||||
| Retained earnings | 23,360 | 20,382 | ||||||
| Unearned compensation | (432 | ) | (182 | ) | ||||
| Accumulated other comprehensive income | 300 | 220 | ||||||
| Treasury stock | (10,688 | ) | (4,756 | ) | ||||
| Total shareholders’ equity | 32,594 | 35,018 | ||||||
Total Liabilities and Shareholders’ Equity | $ | 44,547 | $ | 47,954 | ||||
-END-