National Research Corp. Q4 FY2023 earnings call

• Reset strategy to address client demand for expanded market coverage, value-added solutions and greater strategic impact with key principles like doubling total addressable market, being essential to clients' success, ramping up sales efforts, improving associates' careers, and delivering more to stockholders.
• Achieved milestones such as expanding employee and consumer experience capabilities, core revenue over 90% of total revenue, sales team growth, reduced headcount, sales pipeline over $100M, recurring new sales up 18% in Q4 2023 vs Q4 2022, revenue per FTE up 10%, operating margin improvement, customer NPS at 75, $55M returned to stockholders in 2023, and win with Advocate Health as the largest client.
• Added new executives like Chief Revenue Officer, Chief Product Technology Officer, and Chief Corporate Development Officer in January 2024.

Core revenue is over 90% of total revenue. Since mid-2022, the sales team has grown by over 20% while overall associate headcount has been reduced by 16%. Sales pipeline exceeds $100 million, and recurring new sales were up 18% in the fourth quarter of 2023 compared with the fourth quarter of 2022. Revenue per FTE was up 10% this year over last year. Operating margin has improved throughout the year. Customer NPS hit 75 in the last quarter, which is the highest ever.

• 2024 business goals: expand total addressable market, use technology including AI to launch innovative products generating ROI, accelerate sales pipeline growth and conversion, expand efficiency and automation.
• Financial perspective: expect 2024 revenue and earnings trends to start relatively flat year-over-year, with higher tech, sales, and executive expenses weighing on margins initially, then double-digit growth and expanded margins beyond 2024.
• Capital allocation: purchased $15M of stock and paid $3M in dividends in Jan 2024, focus on growth and innovation investments including building renovation and quarterly dividends.

This conference call includes forward-looking statements related to the company that involve 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 facts that could affect the company's future results, please see the company's filings with the Securities and Exchange Commission.

Q: A: Q: A: We have no questions registered at this time