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First Financial Corporation Reports First Quarter Results

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First Financial reported a net income of $10.9 million for Q1 2024 compared to $16.0 million in Q1 2023. Diluted net income per share was $0.93 versus $1.33 for the same period in 2023. Return on average assets decreased to 0.91% from 1.32% in Q1 2023. Credit loss provision remained unchanged at $1.8 million. Pre-tax, pre-provision net income was $14.9 million versus $21.4 million in Q1 2023. Total loans outstanding and deposits increased, while nonperforming loans, net interest income, and net interest margin saw declines.

First Financial ha riportato un utile netto di $10,9 milioni per il primo trimestre del 2024 rispetto ai $16,0 milioni nello stesso periodo del 2023. L'utile netto diluito per azione è stato di $0,93 contro $1,33 nel 2023. Il ritorno sugli asset medi è diminuito al 0,91% dal 1,32% nel primo trimestre del 2023. La provvista per perdite su crediti è rimasta invariata a $1,8 milioni. Il reddito netto pre-tasse e pre-provvigioni è stato di $14,9 milioni contro i $21,4 milioni nel primo trimestre del 2023. Il totale dei prestiti in sospeso e dei depositi è aumentato, mentre i prestiti non performanti, il reddito netto da interessi e il margine di interesse netto hanno registrato cali.
First Financial reportó un ingreso neto de $10.9 millones para el primer trimestre de 2024 en comparación con los $16.0 millones en el mismo período de 2023. La ganancia neta diluida por acción fue de $0.93 versus $1.33 para el mismo período en 2023. El retorno sobre los activos promedio disminuyó al 0.91% del 1.32% en el primer trimestre de 2023. La provisión para pérdidas crediticias se mantuvo sin cambios en $1.8 millones. El ingreso neto antes de impuestos y provisiones fue de $14.9 millones frente a $21.4 millones en el primer trimestre de 2023. Los préstamos totales pendientes y los depósitos aumentaron, mientras que los préstamos no productivos, los ingresos netos por intereses y el margen de interés neto disminuyeron.
퍼스트 파이낸셜은 2024년 1분기에 1090만 달러의 순수익을 보고하였습니다. 이는 2023년 같은 기간의 1600만 달러와 비교됩니다. 주당 순수익은 0.93달러로, 2023년 동기의 1.33달러와 비교되었습니다. 평균 자산수익률은 2023년 1분기의 1.32%에서 0.91%로 감소하였습니다. 신용손실 준비금은 180만 달러로 변동이 없었습니다. 세전 및 준비금 이전 순수익은 1490만 달러로, 2023년 1분기의 2140만 달러와 비교됩니다. 총 대출 및 예금은 증가했으나, 부실 대출, 순이자 수익, 순이자 마진은 감소하였습니다.
First Financial a déclaré un bénéfice net de 10,9 millions de dollars pour le premier trimestre 2024, par rapport à 16,0 millions de dollars au premier trimestre 2023. Le bénéfice net dilué par action était de 0,93 $ contre 1,33 $ pour la même période en 2023. Le rendement des actifs moyens a diminué, passant de 1,32 % au premier trimestre 2023 à 0,91 %. La provision pour pertes sur crédits est restée inchangée à 1,8 million de dollars. Le revenu net avant impôts et provisions était de 14,9 millions de dollars contre 21,4 millions de dollars au premier trimestre 2023. Les prêts totaux en cours et les dépôts ont augmenté, tandis que les prêts non performants, le revenu net d'intérêts et la marge nette d'intérêts ont diminué.
First Financial meldete für das erste Quartal 2024 einen Nettogewinn von 10,9 Millionen Dollar im Vergleich zu 16,0 Millionen Dollar im gleichen Zeitraum von 2023. Der verwässerte Nettogewinn pro Aktie betrug 0,93 Dollar gegenüber 1,33 Dollar im Jahr 2023. Die Rendite der durchschnittlichen Aktiva sank von 1,32% im ersten Quartal 2023 auf 0,91%. Die Rückstellung für Kreditverluste blieb unverändert bei 1,8 Millionen Dollar. Das Nettoeinkommen vor Steuern und Rückstellungen betrug 14,9 Millionen Dollar verglichen mit 21,4 Millionen Dollar im ersten Quartal 2023. Die gesamten ausstehenden Darlehen und Einlagen stiegen, während notleidende Kredite, der Nettozinsertrag und die Nettozinsmarge zurückgingen.
Positive
  • Strong loan growth with total loans outstanding and average total loans increasing.

  • Stable asset quality and strong capital levels reported by the company.

  • Shareholders' equity increased to $520.8 million, with a rise in Book Value and Tangible Book Value per share.

Negative
  • Decline in net income, diluted net income per share, and return on average assets compared to Q1 2023.

  • Decrease in net interest income and net interest margin for Q1 2024.

  • Increase in nonperforming loans and non-interest expense for the company.

Insights

First Financial Corporation's Q1 results reveal a contraction in net income to $10.9 million from $16.0 million year-over-year, a substantial 31.9% reduction. Diluted EPS has decreased from $1.33 to $0.93. These metrics indicate a compression in profitability, which might concern investors as it suggests a potentially challenging economic environment or internal inefficiencies. However, an increase in average total loans signifies business growth potential.

Another indicator to consider is the Return on Average Assets (ROAA), which has decreased from 1.32% to 0.91%. This can be reflective of asset performance, affecting overall returns for shareholders. Furthermore, the unchanged Credit Loss Provision year-over-year implies a steady management outlook on potential credit losses, even amid changing economic conditions.

Lastly, the efficiency ratio has deteriorated from 58.73% to 67.21%, suggesting rising costs or declining revenues relative to the bank's total income. For investors, these changes underscore the importance of monitoring cost control and operational efficiency as indicators of management's effectiveness.

The Q1 results exhibit a mixed financial landscape for First Financial Corporation. Loan growth, driven by Commercial Real Estate and Consumer Auto segments, signifies an active lending market and potential interest income streams. Conversely, average total deposits contraction from $4.25 billion to $4.05 billion might reflect shifts in consumer behavior or competitive dynamics within the banking sector.

While the balance sheet shows a steady increase in total loans outstanding and shareholders' equity, the rise in nonperforming loans from $12.1 million to $24.3 million could be a red flag signaling credit risk exposure. Investors could see this as an indication of the economic health of borrowers and the potential for future write-downs affecting profitability. Moreover, the net interest margin decline from 3.96% to 3.53% potentially points to narrower profitability on interest-earning assets, a key factor for revenue generation in banking.

When dissecting First Financial Corporation's Q1 results, one must consider the tangible book value per share increment from $34.16 to $36.26 alongside the Tangible Common Equity to Tangible Assets Ratio uptick from 8.63% to 9.00%. These improvements suggest a solidification of the bank's intrinsic value, which could provide a cushion during economic downturns.

However, investors should weigh these positive aspects against the diminished net interest income, which has decreased from $44.3 million to $38.9 million, reflecting pressures on the core business operations. The effective tax rate has seen a minor decline to 16.79%, which might offer slight relief in tax burden but is rather insubstantial in the bigger profitability picture. In essence, retail investors should consider both the strengthening of the bank's core capital metrics and the pressing issues in income and loan performance when evaluating the stock's potential.

TERRE HAUTE, Ind., April 30, 2024 (GLOBE NEWSWIRE) -- First Financial Corporation (NASDAQ:THFF) today announced results for the first quarter of 2024.

  • Net income was $10.9 million compared to the $16.0 million reported for the same period of 2023;
  • Diluted net income per common share of $0.93 compared to $1.33 for the same period of 2023;
  • Return on average assets was 0.91% compared to 1.32% for the three months ended March 31, 2023;
  • Credit loss provision was $1.8 million compared to provision of $1.8 million for the first quarter 2023; and
  • Pre-tax, pre-provision net income was $14.9 million compared to $21.4 million for the same period in 2023.1

1 Non-GAAP financial measure that Management believes is useful for investors and management to understand pre-tax profitability before giving effect to credit loss expense and to provide additional perspective on the Corporations performance over time as well as comparison to the Corporations peers and evaluating the financial results of the Corporation – please refer to the Non GAAP reconciliations contained in this release.

Average Total Loans

Average total loans for the first quarter of 2024 were $3.18 billion versus $3.07 billion for the comparable period in 2023, an increase of $111 million or 3.63%. On a linked quarter basis, average loans increased $47 million or 1.50% from $3.13 billion as of December 31, 2023.

Total Loans Outstanding

Total loans outstanding as of March 31, 2024, were $3.19 billion compared to $3.08 billion as of March 31, 2023, an increase of $112 million or 3.63%, primarily driven by increases in Commercial Real Estate and Consumer Auto loans. On a linked quarter basis, total loans increased $24.2 million or 0.76% from $3.17 billion as of December 31, 2023.

“We are pleased with our first quarter results, as we experienced another quarter of solid loan growth,” said Norman D. Lowery, President and Chief Executive Officer. “Our balance sheet is strong, our asset quality is stable, and our capital levels remain strong.”

Average Total Deposits

Average total deposits for the quarter ended March 31, 2024, were $4.05 billion versus $4.25 billion as of March 31, 2023.

Total Deposits

Total deposits were $4.11 billion as of March 31, 2024, compared to $4.17 billion as of March 31, 2023. On a linked quarter basis, total deposits increased $15.0 million, or 0.37% from $4.09 billion. Non-interest bearing deposits were $738 million and time deposits were $581 million as of March 31, 2024.

Shareholders’ Equity

Shareholders’ equity at March 31, 2024, was $520.8 million compared to $505.5 million on March 31, 2023. During the last twelve months, the Corporation has repurchased 311,360 shares of its common stock. There were no shares repurchased during the quarter. 518,860 shares remain available for repurchase under the current repurchase authorization. During the quarter, the Corporation paid a $0.45 per share quarterly dividend and declared a $0.45 quarterly dividend payable April 15, 2024.

Book Value Per Share

Book Value per share was $44.08 as of March 31, 2024, compared to $41.89 as of March 31, 2023, an increase of $2.19 per share or 5.22%. Tangible Book Value per share was $36.26 as of March 31, 2024, compared to $34.16 as of March 31, 2023, an increase of $2.10 per share or 6.15%.

Tangible Common Equity to Tangible Asset Ratio

The Corporation’s tangible common equity to tangible asset ratio was 9.00% at March 31, 2024, compared to 8.63% at March 31, 2023.

Net Interest Income

Net interest income for the first quarter of 2024 was $38.9 million, compared to $44.3 million reported for the same period of 2023. Interest income increased $4.7 million and interest expense increased $10.1 million year over year.

Net Interest Margin

The net interest margin for the quarter ended March 31, 2024, was 3.53% compared to the 3.96% reported at March 31, 2023.

Nonperforming Loans

Nonperforming loans as of March 31, 2024, were $24.3 million versus $12.1 million as of March 31, 2023. The ratio of nonperforming loans to total loans and leases was 0.76% as of March 31, 2024, versus 0.39% as of March 31, 2023. The increase was driven primarily by the addition of one credit placed on non-accrual in fourth quarter 2023.

Credit Loss Provision

The provision for credit losses for the three months ended March 31, 2024, was $1.8 million, unchanged from the first quarter 2023.

Net Charge-Offs

In the first quarter of 2024 net charge-offs were $1.5 million compared to $2.0 million in the same period of 2023.

Allowance for Credit Losses

The Corporation’s allowance for credit losses as of March 31, 2024, was $40.0 million compared to $39.6 million as of March 31, 2023. The allowance for credit losses as a percent of total loans was 1.25% as of March 31, 2024, compared to 1.29% as of March 31, 2023. On a linked quarter basis, the allowance for credit losses as a percent of total loans decreased 1 basis point from 1.26% as of December 31, 2023.

Non-Interest Income

Non-interest income for the three months ended March 31, 2024 was $9.4 million unchanged from the first quarter 2023.

Non-Interest Expense

Non-interest expense for the three months ended March 31, 2024, was $33.4 million compared to $32.3 million in 2023, an increase of 3.4% reflective of our history of strong expense control.

Efficiency Ratio

The Corporation’s efficiency ratio was 67.21% for the quarter ending March 31, 2024, versus 58.73% for the same period in 2023.

Income Taxes

Income tax expense for the three months ended March 31, 2024, was $2.2 million versus $3.6 million for the same period in 2023. The effective tax rate for 2024 was 16.79% compared to 18.42% for 2023.

About First Financial Corporation

First Financial Corporation (NASDAQ:THFF) is the holding company for First Financial Bank N.A. First Financial Bank N.A., the fifth oldest national bank in the United States, operates 70 banking centers in Illinois, Indiana, Kentucky and Tennessee. Additional information is available at www.first-online.bank.

Investor Contact:
Rodger A. McHargue
Chief Financial Officer
P: 812-238-6334
E: rmchargue@first-online.com

            
 Three Months Ended 
 March 31, December 31, March 31, 
 2024 2023 2023 
END OF PERIOD BALANCES           
Assets$4,852,615  $4,851,146  $4,866,821 
Deposits$4,105,103  $4,090,068  $4,165,398 
Loans, including net deferred loan costs$3,191,983  $3,167,821  $3,080,044 
Allowance for Credit Losses$40,045  $39,767  $39,620 
Total Equity$520,766  $527,976  $505,499 
Tangible Common Equity(a)$428,430  $435,405  $412,118 
            
AVERAGE BALANCES           
Total Assets$4,804,364  $4,725,297  $4,851,484 
Earning Assets$4,566,461  $4,485,766  $4,613,126 
Investments$1,308,322  $1,279,821  $1,407,944 
Loans$3,180,147  $3,133,267  $3,068,716 
Total Deposits$4,045,838  $4,050,968  $4,252,161 
Interest-Bearing Deposits$3,326,090  $3,291,931  $3,407,590 
Interest-Bearing Liabilities$221,425  $206,778  $96,160 
Total Equity$522,720  $463,004  $487,834 
            
INCOME STATEMENT DATA           
Net Interest Income$38,920  $39,590  $44,335 
Net Interest Income Fully Tax Equivalent(b)$40,297  $40,942  $45,654 
Provision for Credit Losses$1,800  $2,495  $1,800 
Non-interest Income$9,431  $11,247  $9,375 
Non-interest Expense$33,422  $34,244  $32,321 
Net Income$10,924  $12,420  $15,980 
            
PER SHARE DATA           
Basic and Diluted Net Income Per Common Share$0.93  $1.06  $1.33 
Cash Dividends Declared Per Common Share$0.45  $0.45  $ 
Book Value Per Common Share$44.08  $44.76  $41.89 
Tangible Book Value Per Common Share(c)$36.26  $31.47  $34.16 
Basic Weighted Average Common Shares Outstanding 11,803   11,772   12,058 
            

(a) Tangible common equity is a non-GAAP financial measure derived from GAAP-based amounts. We calculate tangible common equity by excluding goodwill and other intangible assets from shareholder’s equity.
(b) Net interest income fully tax equivalent is a non-GAAP financial measure derived from GAAP-based amounts. We calculate net interest income fully tax equivalent by adding back the tax equivalent factor of tax exempt income to net interest income. We calculate the tax equivalent factor of tax exempt income by dividing tax exempt income by the net of tax rate of 75%.
(c) Tangible book value per common share is a non-GAAP financial measure derived from GAAP-based amounts. We calculate the factor by dividing average tangible common equity by average shares outstanding. We calculate average tangible common equity by excluding average intangible assets from average shareholder’s equity.



Key RatiosThree Months Ended 
  March 31,   December 31,   March 31, 
  2024   2023   2023 
Return on average assets 0.91%  1.05%  1.32%
Return on average common shareholder's equity 8.36%  10.73%  13.10%
Efficiency ratio 67.21%  65.62%  58.73%
Average equity to average assets 10.88%  9.80%  10.06%
Net interest margin(a) 3.53%  3.63%  3.96%
Net charge-offs to average loans and leases 0.19%  0.22%  0.26%
Credit loss reserve to loans and leases 1.25%  1.26%  1.29%
Credit loss reserve to nonperforming loans 165.12%  161.94%  328.06%
Nonperforming loans to loans and leases 0.76%  0.78%  0.39%
Tier 1 leverage 12.02%  12.14%  11.30%
Risk-based capital - Tier 1 14.69%  14.76%  14.27%
            

(a) Net interest margin is calculated on a tax equivalent basis.


Asset QualityThree Months Ended
 March 31, December 31, March 31,
 2024 2023 2023
Accruing loans and leases past due 30-89 days$17,937  $20,168  $18,934 
Accruing loans and leases past due 90 days or more$1,395  $960  $1,157 
Nonaccrual loans and leases$22,857  $23,596  $10,920 
Other real estate owned$167  $107  $336 
Nonperforming loans and other real estate owned$24,419  $24,663  $12,413 
Total nonperforming assets$27,307  $27,665  $15,327 
Gross charge-offs$3,192  $3,976  $4,376 
Recoveries$1,670  $2,213  $2,417 
Net charge-offs/(recoveries)$1,522  $1,763  $1,959 


Non-GAAP ReconciliationsThree Months Ended March 31,
 2024 2023
($in thousands, except EPS)       
Income before Income Taxes$13,129  $19,589 
Provision for credit losses 1,800   1,800 
Provision for unfunded commitments     
Pre-tax, Pre-provision Income$14,929  $21,389 



CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands, except per share data)
      
 March 31, December 31,
  2024   2023 
 (unaudited)
ASSETS     
Cash and due from banks$69,231  $76,759 
Federal funds sold    282 
Securities available-for-sale 1,218,287   1,259,137 
Loans:     
Commercial 1,816,854   1,817,526 
Residential 710,496   695,788 
Consumer 657,299   646,758 
  3,184,649   3,160,072 
(Less) plus:     
Net deferred loan costs 7,334   7,749 
Allowance for credit losses (40,045)  (39,767)
  3,151,938   3,128,054 
Restricted stock 15,371   15,364 
Accrued interest receivable 23,851   24,877 
Premises and equipment, net 66,830   67,286 
Bank-owned life insurance 114,683   114,122 
Goodwill 86,985   86,985 
Other intangible assets 5,351   5,586 
Other real estate owned 167   107 
Other assets 99,921   72,587 
TOTAL ASSETS$4,852,615  $4,851,146 
      
LIABILITIES AND SHAREHOLDERS’ EQUITY     
Deposits:     
Non-interest-bearing$738,478  $750,335 
Interest-bearing:     
Certificates of deposit exceeding the FDIC insurance limits 109,228   92,921 
Other interest-bearing deposits 3,257,397   3,246,812 
  4,105,103   4,090,068 
Short-term borrowings 88,873   67,221 
FHLB advances 58,576   108,577 
Other liabilities 79,297   57,304 
TOTAL LIABILITIES 4,331,849   4,323,170 
      
Shareholders’ equity     
Common stock, $.125 stated value per share;     
Authorized shares-40,000,000     
Issued shares-16,165,023 in 2024 and 16,137,220 in 2023     
Outstanding shares-11,814,093 in 2024 and 11,795,024 in 2023 2,015   2,014 
Additional paid-in capital 144,391   144,152 
Retained earnings 667,675   663,726 
Accumulated other comprehensive income/(loss) (138,110)  (127,087)
Less: Treasury shares at cost-4,350,930 in 2024 and 4,342,196 in 2023 (155,205)  (154,829)
TOTAL SHAREHOLDERS’ EQUITY 520,766   527,976 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$4,852,615  $4,851,146 



CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
(Dollar amounts in thousands, except per share data)
       
 Three Months Ended 
 March 31, 
  2024   2023 
       
INTEREST INCOME:      
Loans, including related fees$50,052  $44,595 
Securities:      
Taxable 5,931   6,236 
Tax-exempt 2,603   2,598 
Other 817   1,271 
TOTAL INTEREST INCOME 59,403   54,700 
INTEREST EXPENSE:      
Deposits 17,731   9,527 
Short-term borrowings 976   808 
Other borrowings 1,776   30 
TOTAL INTEREST EXPENSE 20,483   10,365 
NET INTEREST INCOME 38,920   44,335 
Provision for credit losses 1,800   1,800 
NET INTEREST INCOME AFTER PROVISION      
FOR LOAN LOSSES 37,120   42,535 
NON-INTEREST INCOME:      
Trust and financial services 1,333   1,317 
Service charges and fees on deposit accounts 6,708   6,818 
Other service charges and fees 223   204 
Securities gains (losses), net     
Interchange income 179   47 
Loan servicing fees 269   285 
Gain on sales of mortgage loans 176   180 
Other 543   524 
TOTAL NON-INTEREST INCOME 9,431   9,375 
NON-INTEREST EXPENSE:      
Salaries and employee benefits 17,330   17,158 
Occupancy expense 2,359   2,599 
Equipment expense 4,144   3,299 
FDIC Expense 662   787 
Other 8,927   8,478 
TOTAL NON-INTEREST EXPENSE 33,422   32,321 
INCOME BEFORE INCOME TAXES 13,129   19,589 
Provision for income taxes 2,205   3,609 
NET INCOME 10,924   15,980 
OTHER COMPREHENSIVE INCOME (LOSS)      
Change in unrealized gains/(losses) on securities, net of reclassifications and taxes (11,096)  14,238 
Change in funded status of post retirement benefits, net of taxes 73   147 
COMPREHENSIVE INCOME (LOSS)$(99) $30,365 
PER SHARE DATA      
Basic and Diluted Earnings per Share$0.93  $1.33 
Weighted average number of shares outstanding (in thousands) 11,803   12,058 


FAQ

What was the net income for First Financial in Q1 2024?

First Financial reported a net income of $10.9 million for the first quarter of 2024.

What was the diluted net income per share for the company in Q1 2024?

The diluted net income per common share for First Financial was $0.93 in Q1 2024.

How did the return on average assets change for First Financial in Q1 2024 compared to Q1 2023?

The return on average assets decreased to 0.91% in Q1 2024 from 1.32% in Q1 2023 for First Financial

What was the credit loss provision for the company in the first quarter of 2024?

The credit loss provision for First Financial remained unchanged at $1.8 million in Q1 2024.

How did total loans and deposits change for First Financial in Q1 2024?

Total loans outstanding and deposits increased for First Financial in the first quarter of 2024.

First Financial Corp/Indiana

NASDAQ:THFF

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579.14M
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77.52%
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Banks - Regional
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TERRE HAUTE