Investor Relations Contact:
Kevin Karas, Chief Financial Officer at 402.475.2525 or click here for more information.
TO OUR SHAREHOLDERS:
National Research Corporation’s 2013 revenue increased by 7% to $93 million, and operating income grew by 9%. The fact that operating income growth outpaced revenue growth speaks to the leverage inherent in our subscription-based business model, a hallmark of our success. However, to really benefit from this leverage we need more top-line growth.
Compared to many organizations, a 7% top-line growth would be satisfying. I believe in light of the healthcare industry transformation, far greater revenue growth rates are possible. For the first time, every aspect of healthcare is changing—and central to all is the changing role of the patient.
Patients are becoming engaged healthcare customers as the cost of care shifts to them. This, combined with ready access to quality information, has imploded the black box of choice when it comes to care options and providers.
In addition, healthcare providers are expanding service offerings to be relevant across the entire care continuum only to find a new competitive set. Retail-based businesses that are clearly more agile in meeting customer needs have introduced the value of convenience for basic healthcare services and it’s succeeding.
Given these and other drivers, most players in healthcare are imagining a very different world where the customer is king. And when the customer is king, the key to the kingdom is to understand what the customer values. This simple truth frames your Company’s opportunity. Everything we do for our healthcare clients focuses on listening and understanding what their customers value.
For an industry far from adept in understanding customer needs or, for that matter, even thinking in terms of customers, your Company has unbridled opportunities to bring value to healthcare providers and payers.
This fact was vividly reinforced recently in a YouTube video sent to me by our Chief Financial Officer, Kevin Karas. The clarity surrounding the importance of what we do has never been more apparent. Viewing this video is the most valuable 13 minutes and 52 seconds that I have spent since founding National Research Corporation 33 years ago. I urge you to watch the video, “Outside-In Perspective and the Agile Organization” by Don Smith.
All the best,
Michael D. Hays,
Chief Executive Officer and Fellow Shareholder