National Research (NRC) 3 Nov 222022 Q3 Earnings call transcript

Hello, and welcome to the National Research Corporation’s Third Quarter 2022 Earnings Call. My name is Bailey and I'll be your moderator for today's today. [Operator Instructions]

I would now like to pass the call over to Kevin Karas, Chief Financial Officer. Sir please go ahead when you are ready.

welcome call. National and third Corporation Bailey earnings quarter you, everyone Research to XXXX Thank is Karas, Stacy, name the of My Kevin call me and Finance. today on joining is Linda our President the Vice company's CFO,

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

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

that For and the company's affect Securities the please Commission. filings further the future with information Exchange facts could see about results, the company's

you, it I'll Kevin. With to that, turn back

Thanks Linda.

quarter, and Last our expectations see in to focus quarter, unique the and noted person. successful extremely symposium care human of Stories. of XXX event most our with both drawing person third annual During theme symposium August. was program understand patient what each the understanding continue understand and in The teams at patient's use adoption matters treat at as we Understanding the provides through in Novant Connecting by over interest each the This understanding program and Human the attendees, and we that program. Health information and adoption human every insights virtually interaction the growth of to fears

several to in more focused quarter. adoptions the growth hiring increased interest. with also sales is resulted our this client contract value pipeline, driving our client base understanding increased on associate more of throughout in in and program sales We're the and resources our understanding The growth accelerate and human third building interest more

then turn the performance call to for the to back questions. call Linda over Let and review open me the financial

TRCV. value total million the quarter Thank with or ended contract you, Kevin. recurring $XXX in third We

represents the down the most prior metric renewal decreased the XXXX discontinuing all contracts under cancellation business for no TRCV XXXX upsells our quarter price recent impacted rate total on non-core as certain strategy quarter growing measured the sales third renewable we or or annual X% to was evolve next assuming our by TRCV in by Our to ending TRCV in decline growth continue respective increases legacy projected year. the end, revenue periods mix solutions at core our over time same The our solutions. focus while digital as

rate XX to was September September compared of XXXX. As XXXX a core TRCV growth X% solution XX, increase our

decrease the base. for due quarter compared closure growth growth the the the third U.S. revenue Revenue quarter XXXX to scheduled reduction $XXX,XXX client our in revenues recurring primarily a existing mainly location. Canadian from Revenue and in our third of increased XXX,XXX, of the from to XXXX

business. XXXX operating $X to by allocate slightly Third an compared a of income and approximately as as to quarter to of term same increase support result the of more success XX%, lower long operating expenses the declined in continue the XXXX resources period we million in revenue

quarter interest $X lead result the believe these We to approximately quarter understanding generation. and brand million by in increased will third XXXX driving compared sales to the expense awareness of Marketing third the in investments of building program. human increased programs, support XXXX in

add prior associates to our their expense $XXX,XXX in an increase in our more is on skills to leverage supporting to our and XXX,XXX resulted our quarter. value essential talent in the retaining automation in Associated initiatives and year associates. automation XXXX focus of believe to that in our We third approximately continued enable better growing we third important approximately clients. asset and the the by increased expenses quarter Investments continue that as compared most to being base

to XXXX XXXX in compared XX%. Third XXXX third tax and as lower quarter both third income. result the XXXX of a rate for quarter the income was operating effective quarter decreased $XXX,XXX, tax by The expense

Net same quarter income million, and for the third the period million XXXX XXXX. $X.X was compared $X.X to for

For increased XXXX. Net $XXX.X million to revenue nine by nine X% decreased million in to of the to first compared $XXX.X for months of nine the income first million $XX.X the XXXX months months XXXX XXXX. to compared first $XX.X million, of for

for preferred priorities The including company's growth board both funded of of nine and to first share totaling innovation months M&A million $X.X capital projects payments funding to capital. $XX.X and of activity dividend company in allocation $XX million internal The investments growth directors as for have for use the innovation in million shareholders repurchases. quarterly purposes established of and with XXXX and addition

turn comments Kevin. my I'll now you, concludes back the for this to morning. call That

Linda. remarks. Thank our prepared you, completes This

So you Bailey, to open call questions. any I the now to ask will

[Operator you. the Peaks comes Alpine from D'Angelo go first Capital. Thank of George Instructions] question today The from line ahead. Please

line Your open. now is

can revenue And things Hey, quarter. give a press of The understanding more in that? from upsells good the clients human morning that grew new little information and or on that like Kevin release us you said types Linda. clients,

to some then other information two four current clients. are clients the to are services agreements were We understanding Yes, those adopt actually their the provide that. with can human that on more Two existing program. new clients we more and adding that added of or feature

joined the and systems to that program that Health will human we are for NRC services understanding adding healthcare new them. So be are to providing

And that's really good.

to update and Can broadly give so on the sounds ongoing force sales expand. force us like with more the you force? sales that continues are an changes And sales

I we saw of been higher turnover of also little move to looking increase fact companies overall pipeline. an positions, as with now actively in sales open pretty bit alignment had we focus only years. of Sure, backfill the that we've we sales And that not we're have. the increasing the to force our rate last lot couple George. over we where the The is forward but looking in a increasing on seeing we're a essentially We, think, like number associates

to that we opportunities therefore us have. more number for follow are of there we and on that to up there salespeople want the overall increase are So

focus So now. that's really our right

can more that upsells you us well give of on color on pipeline, That's helpful. clients new existing as little a as both potential adds. client And

any Generally speaking for opportunities and split between are sell of organizations in that pipeline, fairly in not new well time, doing generally upsell point existing the cross the opportunities opportunities that are currently us. at as as are business with clients

the So growth number opportunities. of increased fairly amount, of in and of in I the that split. as evenly terms generally dollar that's terms what we've today we're say would new the saying And seeing, case we're it's

try Are these discrete this like that say lives would now quarter. to investments, up and hire they And or they're it. at more Got on to or it expenses, longer looks step expenses? least continue you permanent,

our some programs increases is pretty investment have done advertising marketing made this expenses. targeted And biggest doing significant not One in we've both and the in year, terms we're a that of the that communications of staff in in and we past.

to So we really terms generation. that lead and already increase see starting results believe we're of in

contract incremental So relatively that speaking will growth in continue the marketing of will that And in increase going that terms spend future. off value. and into we pay in sales the believe

discrete. we did be increase spending of to the where are other Some more areas going

more the will terms off automation finishing productivity. time of up future pay in the discrete in those one that that associate investments. investments But Some investments are are of we're really really

are of on headquarters I on And working is doing some any or or investments, investments P&L a fund know guys work your that are cash you these mostly flow? any your

but early the and some through expense year, essentially costs this point, the XXXX renovation demolition this those at this going capitalized. some are running At We vast and majority P&L are work or forward, all in being capitalized. costs point, being done, of did was have those as

lot, Great. a guys. Thanks

welcome. You're

more At Kevin time, to Thank for pass the like back you. over I'd [Operator any questions Instructions] conference currently There are to remarks. closing this registered. no

look today you, I that everyone Thank next forward for say time again you. their results to to quarter. wanted our Thank thank Bailey. and sharing we just

today's conference Thank concludes all participation. That you for your call.

You disconnect lines. may now your