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| Contact: | Patrick E. Beans Chief Financial Officer 402-475-2525 |
NATIONAL RESEARCH CORPORATION ANNOUNCES
THIRD QUARTER 2008 RESULTS AND
FOURTH QUARTER DIVIDEND
__________________________________________________
Revenue and Earnings Surpass Expectations
LINCOLN, Nebraska (November 4, 2008) — National Research Corporation (NASDAQ:NRCI) today announced results for the third quarter ended September 30, 2008.
| • | Quarterly revenue $13.5 million |
| • | Quarterly diluted earnings per share of $0.29 |
| • | NRC quarterly net new contracts $2.7 million |
| • | New contracts for subscription-based products continue rapid growth--up 67% for the quarter and 170% year-to-date |
| • | Total recurring contract value $56.5 million, up 16% over third quarter 2007 |
Commenting on the third quarter results, Michael D. Hays, president and chief executive officer of National Research Corporation, said, “We had a good quarter. Traditionally HealthCare Market Guide has driven our third quarter revenue and we knew, given the deferred nature of our new HCMG Ticker product, we had a hurdle to make up. The balance of the organization’s growth did just that and largely offsets HCMG revenue.”
Revenue for the quarter ended September 30, 2008, was $13.5 million compared to $14.0 million for the same quarter 2007. Net income for the quarter ended September 30, 2008, was $2.0 million compared to $2.5 million for the third quarter 2007.
Revenue for the first nine months of 2008 was $38.8 million, compared to $38.1 million for the same period in 2007. Net income for the first nine months of 2008 was $5.6 million resulting in $.83 per basic and $.81 per diluted earnings per share.
The Company also announced that its Board of Directors has declared a regular quarterly cash dividend of $0.14 (fourteen cents) per share payable December 31, 2008, to shareholders of record as of the close of business on December 5, 2008.
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NRCI Announces Third Quarter Results
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November 4, 2008
In closing, Patrick E. Beans, chief financial officer of National Research Corporation, said, “Happily, we are debt free today having paid off the $12.5 million loan in 30 months in conjunction with our acquisition of TGI in May 2006. This, along with having paid $8.2 million in dividends and $8.9 million in repurchasing stock during that same period, speaks to our constant profitability and a very strong cash flow.”
A listen-only simulcast of National Research Corporation’s third quarter conference call will be available online atwww.earnings.com on November 5, 2008, 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 performance measurement, improvement services, and governance education to the healthcare industry in the United States and Canada.
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.
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NRCI Announces Third Quarter Results
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November 4, 2008
NATIONAL RESEARCH CORPORATION
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2008 | 2007 | 2008 | 2007 | |||||||||||
Revenue | $ | 13,469 | $ | 13,952 | $ | 38,824 | $ | 38,102 | ||||||
Operating expenses: | ||||||||||||||
| Direct expenses | 6,598 | 5,930 | 17,845 | 16,744 | ||||||||||
| Selling, general and administrative | 3,053 | 3,240 | 9,960 | 9,890 | ||||||||||
| Depreciation and amortization | 661 | 672 | 2,003 | 1,922 | ||||||||||
| Total operating expenses | 10,312 | 9,842 | 29,808 | 28,556 | ||||||||||
Operating income | 3,157 | 4,110 | 9,016 | 9,546 | ||||||||||
Other income (expense): | ||||||||||||||
| Interest income | 6 | 32 | 33 | 101 | ||||||||||
| Interest expense | (21 | ) | (110 | ) | (118 | ) | (413 | ) | ||||||
| Other, net | 29 | 21 | 9 | 88 | ||||||||||
Total other income (expense) | 14 | (57 | ) | (76 | ) | (224 | ) | |||||||
Income before income taxes | 3,171 | 4,053 | 8,940 | 9,322 | ||||||||||
| Provision for income taxes | 1,205 | 1,558 | 3,390 | 3,592 | ||||||||||
Net income | $ | 1,966 | $ | 2,495 | $ | 5,550 | $ | 5,730 | ||||||
Net income per share, basic | $ | 0.30 | $ | 0.36 | $ | 0.83 | $ | 0.84 | ||||||
| Net income per share, diluted | $ | 0.29 | $ | 0.36 | $ | 0.81 | $ | 0.82 | ||||||
Weighted average shares outstanding: | ||||||||||||||
| Basic | 6,644 | 6,851 | 6,699 | 6,846 | ||||||||||
| Diluted | 6,803 | 7,013 | 6,845 | 6,995 | ||||||||||
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NRCI Announces Third Quarter Results
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November 4, 2008
NATIONAL RESEARCH CORPORATION
Unaudited Consolidated Condensed Balance Sheets
(Dollars in thousands)
| Sept. 30, 2008 | Dec. 31, 2007 | |||||||
|---|---|---|---|---|---|---|---|---|
| ASSETS | ||||||||
Current Assets: | ||||||||
| Cash and cash equivalents | $ | 677 | $ | 3,355 | ||||
| Short-term investments | -- | 99 | ||||||
| Accounts receivable, net | 9,785 | 6,379 | ||||||
| Income taxes recoverable | 55 | 272 | ||||||
| Other current assets | 1,780 | 2,495 | ||||||
| Total current assets | 12,297 | 12,600 | ||||||
Net property and equipment | 12,595 | 11,974 | ||||||
| Other, net | 36,215 | 37,295 | ||||||
Total Assets | $ | 61,107 | $ | 61,869 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 2,152 | $ | 2,492 | ||||
| Deferred revenue | 15,313 | 9,922 | ||||||
| Accrued compensation | 1,457 | 1,477 | ||||||
| Notes payable | 239 | 1,093 | ||||||
| Total current liabilities | 19,161 | 14,984 | ||||||
Non-current liabilities | 2,339 | 4,598 | ||||||
Total Liabilities | 21,500 | 19,582 | ||||||
Shareholders’ Equity: | ||||||||
| Common stock, $0.001 par value; 20,000,000 shares authorized; | ||||||||
| issued 7,942,559 in 2008 and 7,883,289 in 2007; | ||||||||
| outstanding 6,698,480 in 2008 and 6,926,442 in 2007 | 8 | 8 | ||||||
| Additional paid-in capital | 25,807 | 23,508 | ||||||
| Retained earnings | 32,712 | 30,004 | ||||||
| Accumulated other comprehensive income | 694 | 932 | ||||||
| Treasury stock | (19,614 | ) | (12,165 | ) | ||||
| Total shareholders’ equity | 39,607 | 42,287 | ||||||
| Total liabilities and shareholders’ equity | $ | 61,107 | $ | 61,869 | ||||
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