NRC - Earnings call transcript Q2 2018 | National Research Corporation

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Operator

Ladies and gentlemen, thank you for standing by. Welcome to the National Research Corporation second quarter 2018 conference call.

During the presentation, all participants will be in a listen-only mode. And afterwards, we will conduct a question-and-answer session. [Operator Instructions].

conference recorded this XXXX. August reminder, a is Wednesday, being X, As now turn Executive Hays, to would Officer. conference And like Michael the I over to Chief Please go ahead.

Michael Hays

second to Thank Hays, Mike Financial is CEO on Research welcome Kevin Scott me company's call. everyone joining call you Corporation's name and the XXXX Officer. the quarter and is Karas, earnings My Chief National today our

of would to be I continue, ask call. part any made statements we review related Kevin Before conditions might forward-looking that as today's Kevin? to

Kevin Karas

Thank This to call that Litigation Securities forward-looking the provisions are or from includes company actual of statements Act pursuant uncertainties Reform forward-looking materially outcomes made cause Harbor you of and those to conference the Mike. These Safe XXXX. statements currently to differ Private that related involve could anticipated. results risks the

about future, company's Securities I information you back affect further with please Exchange to see the will Commission. facts could the company's With that, filings it and that the For turn the Mike.

Michael Hays

welcome and everyone. again Thanks

wins differentiation unique enhanced vendors the product accelerating our we of Let doubling point-of-sale dollar now legacy advantages, paper-based surveys. new have important transparency I the our within XXXX client highlighted of entire patient the Market clients of to satisfaction with year an regarding is XXXX. the platform's we dollar of new me visibility of value customer attraction a value half third contract quarter. use average further such the value current With advantages Creating of contract over XX% current of increased client platform, comments. Last customer experienced variety on of is as doubling and wins value real with our quarter, call value not first has stickiness. of year-over-year. time our star physicians our contract has of point platform. limited start This the the establishes in voice clients the This legacy digital which ratings, offering, our migration cases entered for fact, In few XXXX proof voice a from matching a the for gain

of prepared XXXX call we have. any balance you second that may which the questions our will Kevin For regarding remarks address has quarter, our today, after some

to I free financial now call as back turn feel queue, Kevin. Kevin please shares the performance enter question would So to highlights. the

Kevin Karas

Thank you Mike.

recurring the of end XX% Subscription-based of to our value. total value of XXXX, represented for quarter multiple of million the to growth Our revenue for same second XX% the quarter. of from contract XXXX of up agreements quarterly over last $XX $X.X quarter Total client contract prior solutions million, total value $XXX.X with $XXX.X care quarter up the value clients period our same XX% of second the contract million the million, at the Total second the at represented end year. XXXX. at of the in the for voice the system at digital at increased first year. agreements second of a of contract our representing ended platform X% $XX.X quarter million time end over the customer compared Health base

million, in decreases a result a services revenue. our from post-acute XXXX governance primarily XXXX, revenue decrease $XX of Second as X% quarter quarter second of was and the of

the sales range. performance is XXXX improved However, quarter to retention, the estimated given X% growth of X% and third to client positive in revenue higher for be

Consolidated Total $XX second of same of compared platform same $XX our quarter operating the million the period compared $XX.X quarter the the million the compared X% for last of XXXX million X% year. period the to to by revenue expenses voice for second for to to XXXX, expenses $XX customer the by XXXX. second second last revenue XXXX, quarter Direct operating for for total second of million quarter quarter $X.X Direct increased conference of year. and million XXXX was of quarter period decreased increased expenses. for to million compared percent XX% decreased were $X.X expenses revenue, expenses to for second same of in of or digital XXXX. the the result costs in the XXXX. lower and quarter total a XX% or XX% for income Direct as revenue for lower as XX% in of revenue collection revenue of XX% a Second to XX% data

Our expense our awards of revenue with for share-based compensation equity XXXX second were the administrative associated the XX% vesting revenue of The to associated and from for the million expense period second XX% XXXX. expenses expenses, for recapitalization. to increase due compared recapitalization and legal quarter and same million SG&A XXXX in the in $X.X of SG&A incremental of software and selling, accelerated hosting for increased same is accounting $X.X platform last general to quarter of year. expenses period to compared with higher fees the

the enacted XXXX. act million in tax increase tax our period income depreciation The in period the of tax and rate of income effective to of rate increased that Our provision of to $XXX,XXX in XXXX. of is for due rate $X.X to primarily from for for $X.X technology XX% platform. is compared an benefit The a rate second in XXXX to corporate XXXX. tax effective the X% recapitalization first second $X.X in XXXX the for of million XXXX XXXX. amortization negative the the an expense compared the the million due million driven was benefit for quarter the XX% The to realized in quarter decrease company The of same effective XX% from quarter to additional same the totaling by $X.X December was compared expense and reduction to investments tax in

expenses. [ph] to $X.X $X.X from the in in income turn from addition, Mike. and nonvested was tax had recapitalization Net by XXXX of that, $XXX,XXX the additional tax In paid XXXX. compared nondeductible call will company offset second million to shareholders, With exercise of of million I dividends options the the benefits back for partially $XX,XXX to expense quarter

Michael Hays

prepared completes remarks. our This you Thank Kevin.

the would I to questions, ask open call please. So Scott to

Operator

we [Operator a Sparacino from question First ahead. go Instructions]. Frank Please have with Analysis. And

Frank Sparacino

Hi you. first for Maybe, Kevin, guys.

wanted where I should I on clear be operating are the side normal some one-time and rate be there What forward, SG&A, on the the in guess quarter. items? things expense to going one-time of Just expenses run ex those the

Kevin Karas

This Hi Frank. is Kevin.

recapitalization in second that things totaled The approximately of couple the a incurred the expenses we second to in related So the $XXX,XXX. quarter quarter.

increase to is related So been prior quarter, to unusually XX% Last the range. typical I we in was would $X $XXX,XXX share-based recap. million, the XX% that compensation. second our year, has compared in related to the credits the SG&A other low say, of some year running had historically, to consider to was due that about to XX% aspect

a So potentially of I give for to expenses $XXX,XXX that think you the if recapitalization QX, forward. you backed the normal of impact for and expense our would out expect SG&A view going more of what quarter the

Frank Sparacino

Kevin. one other And maybe then Thank for me. you

we the simply I Mike clients VOC being customer think long today or I of migration higher base how get of in waiting where trying are agreements or things? are XX% you Kevin, percentage think, a at, significantly of terms platform, it do discussions about, of come Are of you the would digital One, or about? in first the those then to just to current at Just, are talk be existing aggressive for you renewal how some the How migrating. you secondly, of two to today? can guess, the terms XX% And to migrate than takes base? the we

Michael Hays

with the having ways. is conversations Both fairly One we benefits. are reaching in good to questions. understand them it's out The helping coming aggressive organizations unique are and clients we proactively is, two

would from the what clients reach their hearing are our is other other client experience at the paper-and-pencil about the platform out is, to us. legacy on and clients The on so conferences product

and terms business commitments don't either be inbound the of non-caps, the is of that that in paper-and-pencil absolute that the meaning both join guess contracts to would it's So vast but platform. conversations. have exact outbound verbal converted, and/or percentage, majority I the the can I have

So matter them now, And probably up. say, in north and/or of to getting official of and commitments way in would a them the queue I right XX% transition verbal migrate. to ramping we it's of are terms or

safe when the that doing are a part but have in up, client our sure we So premeditated of a logical way gets they experience. it it making set is, side, on great

committed fence. are we on side in have that what the So the the than of more primarily to system, is convert our pipeline

yet there's is, but go, few the still that is will. that I this other am clients to be sure they right a to way The convinced

do of be you point hit think, terms the in tipping year? your Kevin, to of that, I end think, what revenue, we might XX%

Kevin Karas

realistic, think yes. I that's

Michael Hays

Okay.

Frank Sparacino

in that just legacy conversion, one maybe did at then the kind of terms what you of $X on translating look to That's it platform? follow-up. very And is What look helpful. VOC like digital last the When CV?

Michael Hays

now, into And cases into are $X we that bundling Right additional because weren't it's paper-and-pencil use that's environment. turns under contract primarily feasible a that $X.XX.

products platform. as on the purchasing is the of able the that best multiple a there's result client is So purchase or example. to Transparency getting be would

Frank Sparacino

you. Great. Thank

Operator

no are further time. this at [Operator And Instructions]. questions there

Michael Hays

thank next forward look and reporting I Thank Thank to all Kevin you you you progress joining We again. today. for Scott our quarter. and

Operator

you your participation that and line. for the disconnect does conclude your call for We and gentlemen, today. Ladies thank that you ask please

National Research (NRC) 11 Aug 182018 Q2 Earnings call transcript