National Research Corporation today provided insights into its financial performance and operations. The company, founded in 1981 and headquartered in Lincoln, Nebraska, offers subscription-based solutions that provide actionable information and analysis to healthcare organizations in the United States and Canada. These solutions cover various critical elements such as patient experience, service recovery, care transitions, employee engagement, reputation management, and brand loyalty.
The 10-K report details the company's critical accounting policies and estimates, including revenue recognition and valuation of goodwill and identifiable intangible assets. National Research Corporation's revenue for the year ended December 31, 2023, amounted to $148.6 million, showing a slight decrease from the previous year. Direct expenses totaled $56.0 million, with a 2% decrease from 2022, while selling, general, and administrative expenses increased by 9% to $46.6 million. Depreciation, amortization, and impairment expenses also rose by 12% to $5.9 million.
The report further highlights a decline in operating income and margin in 2023 compared to the previous year, primarily attributed to a reduction in revenue and increased investments in marketing and technology. Additionally, the provision for income taxes decreased in 2023, resulting in an effective tax rate of 22%. Recurring contract value also declined in 2023, mainly due to the company's strategy to focus on core digital solutions and lower net sales.
In terms of liquidity and capital resources, National Research Corporation reported $6.7 million in cash and cash equivalents as of December 31, 2023, along with up to $30 million of unused borrowings under its line of credit and an additional $56 million on its delayed draw term note. The company's cash flows from operating activities increased primarily due to working capital changes, including adjustments for non-cash items such as depreciation, amortization, and impairments.
Despite a working capital deficit of $11.8 million on December 31, 2023, National Research Corporation expressed confidence in its existing sources of liquidity, including cash and cash equivalents, borrowing availability, and operating cash flows, to meet its projected capital and debt maturity needs for the foreseeable future.
The market has reacted to these announcements by moving the company's shares 1.2% to a price of $41.04. If you want to know more, read the company's complete 10-K report here.
