The First Bancorp (FNLC) Q3 2024 earnings summary

Executive summary

• Net income for the nine months ended September 30, 2024 was $19.8M, down 13.5% year-over-year, mainly due to higher funding costs, but Q3 net income rose 22.7% sequentially to $7.6M.

• Diluted EPS for the nine months was $1.78, down 13.9% from 2023; Q3 diluted EPS was $0.68, up 22.6% from Q2.

• Total assets grew to $3.14B, with loan balances up at a 10.6% annualized rate and deposits up 4.0%.

• Asset quality remains strong, with non-performing assets at 0.08% of total assets and past-due loans at 0.14%.

• Dividends declared year-to-date totaled $1.07 per share, with a Q3 dividend of $0.36 per share and a 59.8% payout ratio.

Financial highlights

• Net interest income for the nine months was $46.4M, down 6.1% year-over-year, but Q3 net interest income hit a six-quarter high at $16.4M, up 8.8% from Q2.

• Net interest margin was 2.25% for the nine months, up to 2.32% in Q3.

• Non-interest income rose 5.2% year-to-date to $11.9M; Q3 non-interest income was $4.1M, stable quarter-over-quarter.

• Non-interest expense increased 7.5% year-to-date to $35.0M; Q3 expense rose 6.7% to $12.0M.

• Provision for credit losses on loans was $58K for the nine months, with a Q3 reversal of $580K; net charge-offs were $89K year-to-date and $113K in Q3.

Outlook and guidance

• Management expects to remain well capitalized and maintain strong asset quality, with capital ratios well above regulatory minimums.

• Gradual net interest margin improvement is expected as funding cost pressures ease following Fed rate cuts.

• The Bank's capital plan projects well-capitalized status under base and stress scenarios for the next five years.

• Interest rate risk modeling projects net interest income would increase if rates fall and decrease moderately if rates rise, all within policy limits.