First Horizon Corporation's Momentum Continues with Strong First Quarter 2024 Results; Net Income Available to Common Shareholders of $184 Million or EPS of $0.33; $195 Million or $0.35 on an Adjusted Basis - up 9% Over Prior Quarter*

Rhea-AI Summary

First Horizon reported strong first quarter 2024 results with net income available to common shareholders of $184 million or EPS of $0.33, up 9% over the prior quarter. Adjusted net income available to common shareholders was $195 million or $0.35 per share. The company achieved a 10% growth in adjusted net income, positive operating leverage, stable credit quality, and strong capital and liquidity positions. The Chairman, President, and CEO expressed confidence in the organization's ability to deliver exceptional results to shareholders.

Positive

• First Horizon reported a net income available to common shareholders of $184 million or EPS of $0.33 for the first quarter of 2024, a 9% increase over the prior quarter.
• Adjusted net income available to common shareholders was $195 million or $0.35 per share, showing a 10% growth from the fourth quarter of 2023.
• The company achieved positive operating leverage with revenue growth driven by margin expansion in the core banking franchise and improvement in counter-cyclical businesses.
• Credit quality remained stable, and First Horizon holds a strong capital and liquidity position to attract new client relationships and deepen existing ones.
• The Chairman, President, and CEO expressed confidence in the organization's ability to build on its value and earnings power to deliver exceptional results to shareholders.

Negative

• None.

Insights

Financial Analyst

First Horizon Corporation's report presents net income available to common shareholders of $184 million, a modest increase from the previous quarter. The earnings per share (EPS) of $0.33 and an adjusted EPS of $0.35, reflective of a 9% rise, suggest a firm in a solid financial position. This performance is indicative of effective cost management and revenue growth, particularly as the company cites expansion of margins in their core banking franchise.

Return on Tangible Common Equity (ROTCE), a measure of profitability that gauges how well a company is using its capital to generate profits, stands at 11.0% and an adjusted 11.6%. This metric is essential for investors looking at the efficiency of the company's use of equity. Alongside a marginal increase in tangible book value per share to $12.16, these indicators may attract investors seeking companies with prudent growth and stable credit quality.

Market Research Analyst

First Horizon Corporation's emphasis on positive operating leverage and improved performance in counter-cyclical businesses implies a strategic diversification that investors often look for. Companies that show resilience and adaptability in various market conditions can be more attractive in the long term. Additionally, stable credit quality and a strong capital and liquidity profile provide a buffer against potential economic downturns and support ongoing business expansion and client acquisition efforts. Such a comprehensive approach can be a compelling narrative for potential investors, emphasizing the company's positioning for continued growth.

Investment Advisor Perspective

Apart from the hard numbers, it's important to consider the executive optimism, with the CEO's confidence in the company's capability to 'deliver exceptional results to shareholders'. This bullish statement should be weighed against broader market trends and the bank's historical performance. Considering the company's longevity and reported results, investors might view First Horizon as a potentially stable addition to a diversified portfolio. However, tempering enthusiasm with caution is advised, as the financial sector can be sensitive to regulatory changes, interest rate fluctuations and economic cycles.

1Q24 ROTCE of 11.0% and Adjusted ROTCE of 11.6% with Tangible Book Value per Share of $12.16, up $0.03 QoQ*

MEMPHIS, Tenn., April 17, 2024 /PRNewswire/ -- First Horizon Corporation (NYSE: FHN or "First Horizon") today reported first quarter net income available to common shareholders of $184 million or earnings per share of $0.33, compared with fourth quarter 2023 NIAC of $175 million or earnings per share of $0.31.  First quarter 2024 results were reduced by a net $12 million after-tax or $0.02 per share of notable items compared with $3 million or $0.01 per share in fourth quarter 2023. Excluding notable items, adjusted first quarter 2024 NIAC of $195 million or $0.35 per share increased from $178 million or $0.32 per share in fourth quarter 2023.

"We reported a strong quarter with 10% growth in adjusted net income available to common shareholders from the fourth quarter. We achieved positive operating leverage versus the prior quarter, as revenue increased and expenses declined. Revenue growth was driven by margin expansion in the core banking franchise, as well as significant improvement in our counter-cyclical businesses," said Chairman, President and Chief Executive Officer Bryan Jordan. "Credit quality remains stable, and our strong capital and liquidity position us to continue to win new client relationships and deepen existing ones."

Jordan continued, "As we celebrate our 160th year in business, I remain confident in our ability to build on the value and earnings power of our long-standing organization to deliver exceptional results to our shareholders."

Conference Call Information

Analysts, investors and interested parties may call toll-free starting at 8:15 a.m. CT on April 17, 2024 by dialing 1-833-470-1428 (if calling from the U.S.) or 404-975-4839 (if calling from outside the U.S) and entering access code 883096. The conference call will begin at 8:30 a.m. CT.

Participants can also opt to listen to the live audio webcast at https://ir.firsthorizon.com/events-and-presentations/default.aspx. 

A replay of the call will be available beginning at noon CT on April 17 until midnight CT on May 1, 2024. To listen to the replay, dial 1-866-813-9403 (U.S. callers); the access code is 492536. A replay of the webcast will also be available on our website on April 17 and will be archived on the site for one year.

Forward-Looking Statements 

This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Forward-looking statements pertain to FHN's beliefs, plans, goals, expectations, and estimates. Forward-looking statements are not a representation of historical information, but instead pertain to future operations, strategies, financial results, or other developments. Forward-looking statements can be identified by the words "believe," "expect," "anticipate," "intend," "estimate," "should," "is likely," "will," "going forward," and other expressions that indicate future events and trends.

Forward-looking statements are necessarily based upon estimates and assumptions that are inherently subject to significant business, operational, economic, and competitive uncertainties and contingencies, many of which are beyond FHN's control, and many of which, with respect to future business decisions and actions (including acquisitions and divestitures), are subject to change and could cause FHN's actual future results and outcomes to differ materially from those contemplated or implied by forward-looking statements or historical performance. Examples of uncertainties and contingencies include those mentioned: in this document; in Items 2.02 and 7.01 of FHN's Current Report on Form 8-K to which this document has been filed as an exhibit; in the forepart, and in Items 1, 1A, and 7, of FHN's most recent Annual Report on Form 10-K; and in the forepart, and in Item 1A of Part II, of FHN's Quarterly Report(s) on Form 10-Q filed after that Annual Report.

FHN assumes no obligation to update or revise any forward-looking statements that are made in this document or in any other statement, release, report, or filing from time to time.

Use of Non-GAAP Measures and Regulatory Measures that are not GAAP

Certain measures included in this report are "non-GAAP," meaning they are not presented in accordance with generally accepted accounting principles in the U.S. and also are not codified in U.S. banking regulations currently applicable to FHN. Although other entities may use calculation methods that differ from those used by FHN for non-GAAP measures, FHN's management believes such measures are relevant to understanding the financial condition, capital position, and financial results of FHN and its business segments. Non-GAAP measures are reported to FHN's management and Board of Directors through various internal reports.

The non-GAAP measures presented in this earnings release are fully taxable equivalent measures, pre-provision net revenue ("PPNR"), return on average tangible common equity ("ROTCE"), tangible common equity ("TCE") to tangible assets ("TA"), tangible book value ("TBV") per common share, and various consolidated and segment results and performance measures and ratios adjusted for notable items.

Presentation of regulatory measures, even those which are not GAAP, provide a meaningful base for comparability to other financial institutions subject to the same regulations as FHN, as demonstrated by their use by banking regulators in reviewing capital adequacy of financial institutions. Although not GAAP terms, these regulatory measures are not considered "non-GAAP" under U.S. financial reporting rules as long as their presentation conforms to regulatory standards. Regulatory measures used in this financial supplement include: common equity tier 1 capital ("CET1"), generally defined as common equity less goodwill, other intangibles, and certain other required regulatory deductions; tier 1 capital, generally defined as the sum of core capital (including common equity and instruments that cannot be redeemed at the option of the holder) adjusted for certain items under risk based capital regulations; and risk-weighted assets, which is a measure of total on- and off-balance sheet assets adjusted for credit and market risk, used to determine regulatory capital ratios.

Refer to the tabular reconciliation of non-GAAP to GAAP measures and presentation of the most comparable GAAP items, beginning on page 20 of FHN's complete 1Q24 earnings release available at https://ir.firsthorizon.com. 

First Horizon Corp. (NYSE: FHN), with $81.8 billion in assets as of March 31, 2024, is a leading regional financial services company, dedicated to helping our clients, communities and associates unlock their full potential with capital and counsel. Headquartered in Memphis, TN, the banking subsidiary First Horizon Bank operates in 12 states across the southern U.S. The Company and its subsidiaries offer commercial, private banking, consumer, small business, wealth and trust management, retail brokerage, capital markets, fixed income, and mortgage banking services. First Horizon has been recognized as one of the nation's best employers by Fortune and Forbes magazines and a Top 10 Most Reputable U.S. Bank. More information is available at www.FirstHorizon.com. 

*References to "Adjusted" results exclude notable items and are Non-GAAP Financial Measures. All references to loans include leases. All references to earnings per share are based on diluted shares. Please see page 4 for information on our use of Non-GAAP measures and a reconciliation of these measures to GAAP beginning on page 20 of FHN's complete 1Q24 earnings release available at https://ir.firsthorizon.com.

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SOURCE First Horizon Corporation

FAQ

What was First Horizon 's net income available to common shareholders for the first quarter of 2024?

First Horizon reported a net income available to common shareholders of $184 million for the first quarter of 2024.

What was the adjusted net income available to common shareholders for First Horizon in the first quarter of 2024?

The adjusted net income available to common shareholders for First Horizon in the first quarter of 2024 was $195 million.

Did First Horizon experience revenue growth in the first quarter of 2024?

Yes, First Horizon experienced revenue growth driven by margin expansion in the core banking franchise and improvement in counter-cyclical businesses.

What did the Chairman, President, and CEO of First Horizon express confidence in?

The Chairman, President, and CEO of First Horizon expressed confidence in the organization's ability to deliver exceptional results to shareholders.

How did First Horizon 's credit quality perform in the first quarter of 2024?

First Horizon 's credit quality remained stable in the first quarter of 2024.