Looking ahead, Kalani said the company expects funding costs to begin declining in the first quarter of 2026 and projected 2026 net interest margin in the range of 3.90% to 4.00%. He added that if there were no rate cuts in 2026, margin would be expected to come in “a little higher.” Excluding purchase accounting impact, fourth-quarter margin was 3.53% versus 3.59% in the third quarter, primarily due to the deposit-rate lag.CFO Neil Kalani said fourth-quarter net interest margin was 4.00%, down from 4.11% i ...

Orrstown Financial Services (NasdaqCM:ORRF) Q4 2025 Earnings call January 28, 2026 09:00 AM ET Company ParticipantsAdam Metz - COOKyle Gierman - Equity Research AssociateNeelesh Kalani - CFOTimothy P. Switzer - VP, Equity ResearchTom Quinn - President and CEOConference Call ParticipantsGregory Zingone - Equity Research AnalystOperatorGood morning. My name is Sarah, and I will be your conference operator today. At this time, I would like to welcome everyone to the Orrstown Financial Services, Inc., fourth qu ...

Orrstown Financial Services (NasdaqCM:ORRF) Q4 2025 Earnings call January 28, 2026 09:00 AM ET Company ParticipantsAdam Metz - COOKyle Gierman - Equity Research AssociateNeelesh Kalani - CFOThomas R. Quinn - President and CEOTimothy P. Switzer - VP, Equity ResearchConference Call ParticipantsGregory Zingone - Equity Research AnalystOperatorGood morning. My name is Sarah, and I will be your conference operator today. At this time, I would like to welcome everyone to the Orrstown Financial Services, Inc., Fou ...

Financial Data and Key Metrics Changes - Orrstown achieved a record annual net income of $80.9 million, or $4.18 per diluted share, with a return on average equity of 14.76% and return on average assets of 1.49% [3] - For Q4 2025, net income was $21.5 million, or $1.11 per diluted share, with a net interest margin of 4.00%, down from 4.11% in Q3 [9][10] - Fee income for the quarter was $14.4 million, contributing to 22% of total revenues, marking the third consecutive quarter above 20% [5][11] Business Line Data and Key Metrics Changes - Loan growth was steady at 4% during Q4, with a balanced mix across commercial and real estate lending [6][15] - Non-interest income increased to $14.4 million in Q4 from $13.4 million in Q3, driven by growth in wealth management and treasury management services [11][12] - The bank recorded minimal provision expense of $0.1 million and net charge-offs of $0.5 million, with classified loans decreasing by $5.7 million from the prior quarter [7][14] Market Data and Key Metrics Changes - Deposits were relatively flat, declining slightly by $5 million, with a loan-to-deposit ratio of 89% [16] - The cost of deposits was 1.98% for Q4, with expectations for reductions in funding costs starting in Q1 2026 [16][10] Company Strategy and Development Direction - The company continues to focus on enhancing fee income and investing in talent, with recent hiring of a Chief Wealth Officer to drive growth in wealth management [5][6] - Orrstown is strategically investing in the middle-market commercial lending platform and expanding its presence in growth markets [38] - The company remains committed to organic growth, with M&A being a lower priority unless suitable opportunities arise [41] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining strong profitability and anticipates continued growth in loan production and fee income [19] - The company expects net interest margin to stabilize around 4% despite anticipated rate cuts in 2026 [10][31] - Management remains optimistic about the future, citing a robust loan pipeline and strong credit quality [7][19] Other Important Information - The board approved a quarterly dividend increase from $0.27 to $0.30 per share, marking a 50% increase since the merger date [8] - The investment portfolio yield decreased to 4.58% from 4.67% due to declining rates, but the portfolio is positioned well for earnings growth [17] Q&A Session Summary Question: What drove the increase in guidance for non-interest income and expenses? - Management clarified that the increase reflects ongoing strategy to invest in talent to drive future earnings, not a change in strategy [24][25] Question: Can you clarify the NIM trajectory for the year? - Management indicated that core NIM is expected to increase in Q1, with a decline in purchase accounting accretion of about 2-3 basis points each quarter [28][30] Question: What is the current AUM or AUA and success in onboarding Codorus Valley customers? - Total AUM was over $3 billion, with no significant decline in the portfolio from Codorus Valley customers [36][37] Question: What areas is the company focusing on for hiring? - The company is focusing on building out the middle-market commercial lending platform and enhancing wealth management in growth markets [38] Question: What is the current thinking around share buybacks? - Management is monitoring share buyback opportunities but has not found the current stock price favorable for repurchases [46] Question: What yields were achieved on recent securities purchases? - The average yield on recent purchases was 4.92%, with expectations for continued benefits from the investment portfolio [47]

Earnings Presentation Fourth Quarter 2025 January 28, 2026 Non-GAAP Disclosures In this presentation, we refer to tangible book value per share, fee income to operating revenue, adjusted net income, adjusted diluted EPS, adjusted ROAA, adjusted ROAE and the efficiency ratio, which are non-GAAP measures. For a reconciliation of these non-GAAP measures to GAAP results and our rationale for usage of non-GAAP measures, please refer to the GAAP to Non- GAAP reconciliation. 2 Financial Highlights Cautionary Note ...

Financial Performance - Net income for Q4 2025 was $21.5 million, or $1.11 per diluted share, compared to $21.9 million, or $1.13 per diluted share in Q3 2025[3] - For the year ended December 31, 2025, net income totaled $80.9 million, with diluted earnings per share of $4.18, compared to $22.1 million and $1.48 for 2024[3] - Basic earnings per share increased to $1.12 for Q4 2025, compared to $0.72 in Q4 2024, demonstrating significant growth in profitability[29] - Net income for the twelve months ended December 31, 2025, reached $80,855,000, significantly higher than $22,050,000 in 2024, marking a growth of 267.5%[33] - Net income for the quarter was $21,491 thousand, a significant increase from $13,684 thousand in the same quarter of the previous year, representing a growth of 56.8%[51] Income and Expenses - Noninterest income rose by $1.0 million to $14.4 million in Q4 2025, driven by growth in wealth management and swap fees[18] - Noninterest expenses increased by $1.1 million to $37.4 million in Q4 2025, primarily due to higher healthcare and professional service costs[20] - Total noninterest expenses decreased to $37,355,000 in Q4 2025 from $42,930,000 in Q4 2024, a reduction of 12.5%[33] - Adjusted noninterest expense for the twelve months ended December 31, 2025, was $146,825,000, compared to $120,396,000 in 2024, an increase of 22%[54] Asset and Loan Growth - Total loans increased by $41.0 million, or approximately 4% annualized, from Q3 2025 to Q4 2025, totaling $4.0 billion[5] - Total assets increased to $5.542 billion at December 31, 2025, compared to $5.442 billion at December 31, 2024, indicating growth in the asset base[30] - Total interest-earning assets increased to $4,995,061,000 in 2025 from $3,991,148,000 in 2024, reflecting a growth of approximately 25.2%[37] - Average balances of loans increased to $3,945,723,000 in 2025 from $3,150,425,000 in 2024, a growth of approximately 25.3%[37] Capital and Equity - Shareholders' equity increased to $591.5 million at December 31, 2025, up from $571.9 million at September 30, 2025, driven by net income of $21.5 million and other comprehensive income of $2.3 million[24] - The tangible book value per common share rose to $25.21 at December 31, 2025, compared to $24.12 at September 30, 2025, reflecting a stronger capital position[25] - The Company’s total risk-based capital ratio improved to 13.3% at December 31, 2025, compared to 12.4% at December 31, 2024, reflecting enhanced capital adequacy[30] Profitability Ratios - The return on average assets was 1.55% and return on average equity was 14.73% for Q4 2025, compared to 1.60% and 15.72% in Q3 2025[3] - The Company reported a return on average tangible common equity of 18.15% for Q4 2025, down from 19.70% in Q3 2025, attributed to an increase in average shareholders' equity[25] - Return on average tangible equity was 18.15% for the quarter ended December 31, 2025, compared to 13.62% a year earlier, indicating improved profitability[51] Dividend Information - The Board of Directors declared a cash dividend of $0.30 per common share, representing a $0.03 increase from the previous quarter[3] - Dividends paid per share increased to $0.27 in Q4 2025 from $0.23 in Q4 2024, reflecting a growth of 17.4%[34] Credit Quality - Classified loans decreased by $5.7 million to $58.4 million at December 31, 2025, while non-accrual loans increased to $28.0 million[17] - The allowance for credit losses to total loans ratio was 1.19% as of December 31, 2025, compared to 1.24% a year earlier, indicating improved credit quality[45] - The provision for credit losses on loans was $75,000 in Q4 2025, a significant decrease from $2,617,000 in Q4 2024[33] Market and Economic Factors - The company emphasizes that forward-looking statements are based on current expectations and are subject to risks and uncertainties that could lead to actual results differing materially from those anticipated[57] - Factors affecting future performance include interest rate changes, economic conditions, competition, and changes in consumer behavior[57] - The company warns that reliance on forward-looking statements should be limited, as they may not be updated publicly after the date made[58]

Core Insights - Orrstown Financial Services (ORRF) reported revenue of $64.92 million for the quarter ended December 2025, marking a year-over-year increase of 5% and exceeding the Zacks Consensus Estimate of $64.55 million by 0.58% [1] - The company's earnings per share (EPS) for the same period was $1.11, compared to $0.87 a year ago, representing an EPS surprise of 2.47% against the consensus estimate of $1.08 [1] Financial Metrics - The efficiency ratio was reported at 57.5%, higher than the three-analyst average estimate of 56.7% [4] - Average interest-earning assets amounted to $5.08 billion, slightly above the estimated $5.03 billion [4] - The net interest margin was recorded at 4%, compared to the average estimate of 4.1% [4] - Total non-interest income reached $14.39 million, exceeding the average estimate of $13.06 million [4] - Other income was reported at $2.17 million, above the average estimate of $1.99 million [4] - Interchange income was $1.55 million, below the average estimate of $1.8 million [4] - Service charges on deposit accounts totaled $3.23 million, surpassing the average estimate of $2.91 million [4] - Wealth management income was reported at $5.74 million, exceeding the average estimate of $5.17 million [4] - Net interest income was $50.53 million, below the average estimate of $51.55 million [4] Stock Performance - Shares of Orrstown have returned +0.9% over the past month, outperforming the Zacks S&P 500 composite's +0.4% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Orrstown Financial Services (ORRF) came out with quarterly earnings of $1.11 per share, beating the Zacks Consensus Estimate of $1.08 per share. This compares to earnings of $0.87 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of +2.47%. A quarter ago, it was expected that this holding company for Orrstown Bank would post earnings of $1.06 per share when it actually produced earnings of $1.13, delivering a surprise of +6.6%.Over ...

Net income of $21.5 million, or $1.11 per diluted earnings per share, for the three months ended December 31, 2025 compared to net income of $21.9 million, or $1.13 per diluted earnings per share, for the three months ended September 30, 2025;Net income of $80.9 million and diluted earnings per share of $4.18 for the year ended December 31, 2025 compared to net income of $22.1 million and diluted earnings per share of $1.48 for the year ended December 31, 2024;Adjusted net income and diluted earnings per sh ...

HARRISBURG, Pa., Jan. 20, 2026 (GLOBE NEWSWIRE) -- Orrstown Financial Services, Inc. (NASDAQ: ORRF), the holding company of Orrstown Bank, announced today that it will report fourth quarter 2025 earnings at the close of business on Tuesday, January 27, 2026. Management will host a conference call and webcast to review the Company’s quarterly results on Wednesday, January 28, 2026, at 9:00 am ET. The conference call and webcast details are below: Earnings Release: Tuesday, January 27, 2026, After Market Clos ...