Primis Financial Corp. · NASDAQ:FRST
Primis Financial — Q2 2022 Earnings Presentation
23 slides from Primis Financial's earnings presentation, Jul 28, 2022
Slide 1: Second Quarter 2022
Second Quarter 2022 NASDAQ: FRST Exhibit 99.2
Slide 2: Forward-Looking Statements
This presentation and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Secur
Slide 3: Non-GAAP Measures
Statements included in this presentation include non-GAAP financial measures and should be read along with the accompanying tables. Primis uses non-GAAP financial measures to analyze its performance. The measures entitled pre-tax pre-provision operating earnings from continuing operations; pre-tax p
Slide 4: Welcome to Primis
A pioneering bank, committed to imagining a faster and more convenient way to serve you. WELCOME TO PRIMIS Corp. Headquarters: McLean, VA Bank Headquarters: Glen Allen, VA Branches: 34 Ticker (NASDAQ): FRST Valuation Market Capitalization: $327 million Price / Book Value per Share 0.82x Price / Tang
Slide 5: High Performing Community Bank / V1BE Update
High Performing Community Bank 5 V1BE adoption/utilization accelerating with transactions up 31% in Q2 Impressive core market loan growth with 19.8% annualized loan growth in Q2(2) 6 branches consolidated in Q2’22, 2 branches consolidating in Q3’22 Deposits per Branch (1) Pro forma for 2 branch clos
Slide 6: Digital Bank Update
Digital Bank Update 6 Initial consumer launch – July 25, 2022 Business launch anticipated late Q3 Initial products include consumer and business deposit accounts with novel features Significant debit card rewards Free overdraft Embedded V1BE functionality Build out small-business offerings, includin
Slide 7: Panacea Financial Update
7 $61.4 million growth in loan balances in Q2 Q2’22 originations of $69.4 million Now banking >2,000 doctor households across all 50 states Opened 481 new checking and savings accounts in Q2’22 0.0% net charge offs in Q2’22 10 national and state association partnerships Increasing 2022 loan growth g
Slide 8: Life Insurance Premium Finance Update
4 8 Life Insurance Premium Finance Update Key Portfolio Metrics Key Performance Metrics Average Actual Primis Processing Time is ~5 Days Placement Ratio Carrier Approvals Top-Tier Partners Facilitators 72% 24 29 4 Portfolio is over secured by discounted collateral 8.8MM SECURED 27 ORIGINATION CYCLE
Slide 9: Second Quarter Results
Second Quarter Results
Slide 10: Second Quarter Highlights
Net income from continuing operations of $5.0 million or $0.20 per basic and diluted share Adjusted net income from continuing operations of $6.0 million(1) or $0.25 per basic share and $0.24 per diluted share Gross loans, excluding PPP balances and HFS, grew approx. 42% annualized with solid contri
Slide 11: Balance Sheet Trends
Dollars in millions. (1) See reconciliation of Non-GAAP financial measures on slide 23. Balance Sheet Trends 11 $2,629 $2,394 $2,340 $2,315 $2,286 $2,683 $2,686 $2,763 $2,807 $2,751 $3,237 $3,220 $3,407 $3,452 $3,395 9.27% 9.57% 9.26% 9.02% 9.12% Q2'22 Q1'22 Q4'21 Q3'21 Q2'21 Gross Loans Deposits To
Slide 12: Lines of Business
Lines of Business Dollars in thousands. * Net interest income assumes business line funding requirements are provided by the Company at it's cost of funds plus 100 basis points. 12 Bank Panacea LPF Mortgage Q2 '22 Q1 '22 Chg Q2 '22 Q1 '22 Chg Q2 '22 Q1 '22 Chg Q2 '22 Q1 '22 Chg Net Interest Income *
Slide 13: Loan Composition and Trends
Dollars in millions. Loan Composition and Trends 13 Loan Trends and Yields Q2’22 Loan Composition (Ex. PPP) Robust loan growth of 10.5%, or 42% annualized, linked-quarter excluding PPP balances (30.8% annualized for 1H’22) Already exceeded loan growth expectations for 2022, excluding PPP balances, a
Slide 14: Asset Quality
Classified loans and NPAs exclude guaranteed portion of SBA loans. Asset Quality 14 NPAs / Loans (Ex. PPP) + OREO NCOs / Average Loans Criticized & Classified Loans / Total Loans (Ex. PPP) Nonperforming loans increased $4.7 million in Q2, primarily due to one large residential property (<50% LTV) Cl
Slide 15: Allowance for Credit Losses
Classified loans exclude guaranteed portion of SBA loans. Allowance for Credit Losses 15 ACL / Gross Loans (Ex. PPP) ACL / Classified Loans Provision for credit losses of $0.4 million in Q2 versus provision of $0.1 million in Q1 ACL coverage of gross loans declined to 1.16% from 1.24% in Q1 81.5% 71
Slide 16: Deposit Trends
Dollars in millions. (1) Core deposits exclude time deposits. Deposit Trends 16 Deposit Composition – Q2’22 Core Deposit Growth (1) Total deposits were essentially flat in Q2 versus Q1 while NIB increased to 24.3% of total deposits Focus remains on building customer relationships and continuing to g
Slide 17: Margin Progression
Margin Progression Dollars in millions. (1) See reconciliation of Non-GAAP financial measures on slide 23 Net Interest Income and Net Interest Margin 17 Excluding PPP impacts, Q2’22 was the fifth consecutive quarter of increasing net interest income and fourth consecutive quarter of margin expansion
Slide 18: Non-Interest Expense and Efficiency Ratio
Q2 NIE, excluding unfunded commitment expense, impacted by the following: $401K merger-related expenses (up from $115K in Q1) Branch closure-related expenses of $901K Addition of Primis Mortgage expenses for June of $759K Excluding nonrecurring items and impact of mortgage, Q2 NIE was down slightly
Slide 19: Profitability
Dollars in millions. (1) Results from continuing operations. (2) See reconciliation of Non-GAAP financial measures on slide 23. Profitability 19 Return on Average Assets Pre-Tax Pre-Provision Operating Earnings (1) Meaningful operating leverage in Q2’22 expected to continue PTPP Operating ROAA highe
Slide 20: Per Share Results
Tangible Book Value Per Share Diluted Earnings Per Share and Adjusted Diluted EPS (1) See reconciliation of Non-GAAP financial measures on slide 23. Per Share Results 20 (1) Tangible book value per share adversely impacted by $8.5 million change in unrealized mark-to-market adjustments on the Compan
Slide 21: Summary
Talented management team and board committed to building long-term shareholder value Attractive multi-pronged strategy for growth beginning to pay dividends Aggressive and early use of technology positioning the bank for superior performance as the industry evolves Significant valuation upside as st
Slide 22: Appendix
Appendix 22
Slide 23: Non-GAAP Reconciliation
*Net interest margin excluding the effect of PPP loans assumes a funding cost of 35 bps on average PPP balances in all applicable periods. Non-GAAP Reconciliation 23 Primis Financial Corp. (Dollars in thousands, except per share data)For Three Months Ended:Reconciliation of Non-GAAP items:2Q 20221Q