National Research (US:NRC)2019-11-09 20:28Financial Data and Key Metrics Changes - Total contract value at the end of Q3 2019 was $140.5 million, representing an 11% growth year-over-year [6] - Q3 2019 revenue was $32.5 million, an increase of 8% compared to Q3 2018 [7] - Net income for Q3 2019 was $8.1 million, up from $7 million in Q3 2018 [11] Business Line Data and Key Metrics Changes - Revenue from the digital Voice of the Customer platform solutions increased to 64% of total revenue in Q3 2019, compared to 51% in Q3 2018 [7] - Total contract value for digital Voice of the Customer platform solutions rose to $93 million from $69.8 million year-over-year [6] Market Data and Key Metrics Changes - Health care system clients with agreements for multiple solutions represented 27% of the client base at the end of Q3 2019, up from 24% the previous year [6] Company Strategy and Development Direction - The company is focusing on the Voice of the Customer platform as a key revenue growth engine, registering year-to-date revenue growth of 35% in 2019 over 2018 [13] - The strategy includes converting current clients to the VoC platform, winning new clients, and capitalizing on the existing installed base by adding value through additional use cases [14] Management's Comments on Operating Environment and Future Outlook - Management noted that healthcare systems are prioritizing efficiency and scrutinizing their spending, which presents challenges but also opportunities to demonstrate ROI [22][23] - The company is experiencing strong sales momentum, setting a new record of $10 million in net new sales for the quarter [5] Other Important Information - Total operating expenses for Q3 2019 were $22.2 million, an increase of 7% compared to the prior year [8] - Selling, general, and administrative expenses increased to $8.7 million in Q3 2019 from $7.7 million in Q3 2018 [10] Q&A Session Summary Question: Can you expand on the additional products or services being sold into the existing customer base? - The company is integrating historically separate offerings into the VoC platform, such as transitions calls, to provide broader value across the platform [17][18] Question: How are competitors responding in the sales cycles? - The company is becoming more comfortable with its value proposition, showing tangible differences compared to competitors like PRC and Press Ganey, particularly in product offerings [20][21] Question: Any comments on the macro environment and its impact on IT or operating budgets? - The company acknowledges that healthcare systems are focused on efficiency and cost-cutting, but has been successful in demonstrating value and ROI to both prospects and existing customers [22][23]