Primis Financial Corp. · NASDAQ:FRST
Primis Financial — Q3 2024 Earnings Presentation
21 slides from Primis Financial's earnings presentation, Oct 25, 2024
Slide 1: Third Quarter 2024
Third Quarter 2024 NASDAQ: FRST
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 financial 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 net income adjusted for nonrecurring income and expenses; pre-tax pre-provisio
Slide 4: Company overview and valuation
Corp. Headquarters: McLean, VA Bank Headquarters: Glen Allen, VA Branches: 24 Ticker (NASDAQ): FRST Valuation Market Capitalization: $297 million Price / Book Value per Share 0.78x Price / Tangible Book Value(1): 1.03x Price / 2024 Estimated EPS(2): 7.28x Price / 2025 Estimated EPS(2): 6.67x Dividen
Slide 5: Community bank deposit base and V1BE update
V1BE Update(1) Deposits per Branch(2) 82% ~$189 million 2,497 11,268 $136.3 $138.1 $139.0 $137.8 % of active V1BE Deposit balance of Users with 131 Q3 Transactions Users are SMBs V1BE users added in Q3’24 $102.9 Q3'23 Q4'23 Q1'24 Q2'24 Q3'24 • Attractive community bank deposit base with core bank co
Slide 6: Sale of Life Premium Finance division to EverBank
• On October 24, 2024, the Bank entered into a purchase and assumption agreement with EverBank, N.A. to acquire Primis’ Life Premium Finance Division • EverBank will acquire the substantial majority of the associated loans along with the operations and employees of the division for a premium of $6 m
Slide 7: Expanded Mortgage Warehouse Lending effort
• Hired a seasoned team of professionals in October 2024 to lead an expanded Mortgage Warehouse Lending effort • Long track record in the space and most recently at a large bank that is exiting the business due to its pending sale • Four key leadership individuals covering sales, operations, credit
Slide 8: Panacea Financial Q3'24 summary and loan composition
Q3’24 Loan Composition ($392 million) Q3’24 Summary 11.1% • Life-to-date loan originations of ~$550 mil. (committed bal.), +33% y/y • Q3’24 originations of $28.3 mil. • Total deposits of $90 mil., +69% y/y 17.6% • 9/30/24 deposit cost of 2.00% • YTD Pre-Tax 1.90% ROA and $4.8 million pre-tax earning
Slide 9: Mortgage segment Q3 highlights
• Pre-tax earnings for Q3: $1.0MM • Aggressively managing costs to preserve profitability in lower volume environment • Funded production of $230 million in Q3’24 • Now licensed in 43 states and D.C. • Continue to add reliable performers using our culture and commitment to the industry versus signin
Slide 10: Third Quarter Results
Third Quarter Results
Slide 11: Total assets, gross loans, deposits and TCE/TA
7.53% $3,966 $4,025 $3,839 $3,857 $3,890 7.46% $3,293 $3,270 $3,315 $3,335 $3,306 $3,228 $3,301 $3,174 $3,219 $2,965 7.36% 7.30% 7.27% Q3'23 Q4'23 Q1'24 Q2'24 Q3'24 (1) Total Assets Gross Loans (2) Deposits TCE/TA Dollars in millions. (1) See reconciliation of Non-GAAP financial measures on slide 21
Slide 12: Results and corrected Consumer Program accounting
• Results include impact of corrected accounting for a third-party originated consumer loan program (the “Consumer Program”) • Subset of loans with promotional features do not accrue interest until the end of the promotional period • Third-party reimbursement for waived interest on promotional loans
Slide 13: Net interest income and margin
3Q 2024 2Q 2024 1Q 2024 4Q 2023 3Q 2023 Interest Income 57,112 52,199 50,345 50,163 48,027 Interest Expense 29,089 27,346 25,076 24,437 23,697 Net Interest Income 28,023 24,853 25,269 25,726 24,330 Yield on Loans 6.31% 5.91% 5.87% 5.78% 5.52% Yield on Earning Assets 6.06% 5.72% 5.65% 5.58% 5.33% Cos
Slide 14: Noninterest expense and core operating expense burden
3Q 2024 2Q 2024 1Q 2024 4Q 2023 3Q 2023 Reported Noninterest Expense 31,045 29,786 27,538 27,780 36,950 Panacea Fin. Holdings Consolidated Exp. (2,666) (2,347) (2,119) (2,813) - Noninterest Expense Excluding PFH 28,379 27,439 25,419 24,967 36,950 Nonrecurring Items / Goodwill Impair. (1,352) (1,453)
Slide 15: Deposit composition and core deposit growth
Deposit Composition – Q3’24 Core Deposit Growth(1) Time Deposits Demand Deposits 12.9% 12.7% 2.82% 2.98% 3.04% 2.60% 2.69% NOW Accounts Savings Accounts 22.6% $2,842 $2,824 $2,892 $2,912 $2,879 26.4% $420 $491 $473 $463 $421 $2,351 $2,351 $2,429 $2,492 $2,458 Money Market Accounts 25.3% Q3'23 Q4'23
Slide 16: Non-owner occupied CRE by collateral type
Non-Owner Occupied Office CRE NOO CRE By Collateral Type(1) $136 4% Non-Owner-Occupied CRE by Type Total Outstanding % of Portfolio Excl PPP Hotel $193 5.8% Office $136 4.1% Non-Owner Occupied Non-Office CRE Retail $93 2.8% $468 Assisted Living $61 1.8% 14% All other $34 1.0% Warehouse/Industrial $2
Slide 17: Criticized and classified loans, NPAs and net charge-offs
• Nonperforming assets, excluding portions guaranteed by the SBA, were $10.2 million at September 30, 2024, compared to $9.9 million at June 30, Criticized & Classified Loans / Total Loans (Ex. PPP) 2024 3.02% • Loans rated substandard or doubtful increased to $47.6 million in the third 2.85% quarte
Slide 18: ACL walk forward and provision for credit losses
ACL Walk Forward ACL / Gross Loans (Ex. PPP)(1) 11.38% 11.37% 11.61% 10.87% 1.62% 1.66% 1.56% 1.53% 1.13% 2.24% 1.06% 0.99% 1.01% 0.94% 1.00% Q3'23 Q4'23 Q1'24 Q2'24 Q3'24 Core Consumer Program • Provision for credit losses of $7.5 million in Q3 versus provision of $3.1 million in Q2 • Provision inc
Slide 19: Investment highlights
• Talented management team and board committed to building long-term shareholder value • Attractive core-funded community bank with a complementary digital funding platform • Aggressive and early use of technology positioning the Bank for superior performance as the industry evolves • Significant va
Slide 20: Appendix
Appendix 20
Slide 21: Reconciliation of Non-GAAP items
Primis Financial Corp. (Dollars in thousands, except per share data) For Three Months Ended: For Nine Months Ended: Reconciliation of Non-GAAP items: 3Q 2024 2Q 2024 1Q 2024 4Q 2023 3Q 2023 3Q 2024 3Q 2023 Net income (loss) attributable to Primis' common shareholders $ 1,212 $ 3,782 $ 2,466 $ (8,171