LCNB (LCNB) Q2 2024 earnings summary

Executive summary

• Net income for Q2 2024 was $925,000 ($0.07 per share), down from $4.7 million ($0.42 per share) in Q2 2023, impacted by acquisition-related expenses for Eagle Financial Bancorp and Cincinnati Bancorp.

• Second quarter results reflect initial contribution from Eagle Financial Bancorp acquisition and ongoing benefits from Cincinnati Bancorp acquisition.

• Record total assets, wealth management assets, and total assets managed of $4.21 billion at quarter end.

• Integration of Eagle and Cincinnati Federal completed, with all customers now on one system.

• Effective tax rate for Q2 2024 was 2.0%, significantly lower than 17.9% in Q2 2023, due to tax-exempt items not decreasing in proportion to earnings.

Financial highlights

• Net interest income for Q2 2024 rose to $15.2 million from $14.2 million in Q2 2023; net interest margin was 2.86%, down from 3.28%.

• Non-interest expense for Q2 2024 was $17.8 million, up from $12.1 million, mainly due to higher personnel and merger-related costs.

• Non-interest income for Q2 2024 increased 11.9% year-over-year to $4.1 million, with higher fiduciary income and loan sale gains, partially offset by losses on loan sales.

• Provision for credit losses was $528,000 in Q2 2024, up from $30,000 in Q2 2023, including $763,000 for non-PCD loans from the EFBI merger.

• Total assets increased to $2.37 billion at June 30, 2024, up 21.6% year-over-year and 3.5% from December 31, 2023.

Outlook and guidance

• Management expects year-over-year earnings growth to reaccelerate in Q4 2024.

• Company anticipates continued improvements in profitability due to completed integrations and strong asset quality.

• Management expects continued integration of recent acquisitions and ongoing focus on loan and deposit growth.

• Interest rate environment and economic conditions remain key uncertainties impacting net interest margin and credit quality.