Exhibit 99.1 Contact: Dean J. Brydon, CEO Jonathan A. Fischer, President & COO Marci A. Basich, CFO (360) 533-4747 www.timberlandbank.com Timberland Bancorp Third Fiscal Quarter Net Income Increases to $7.10 Million HOQUIAM, WA – July 22, 2025 – Timberland Bancorp, Inc. (NASDAQ: TSBK) ("Timberland" or "the Company"), the holding company for Timberland Bank (the "Bank"), today reported net income of $7.10 million, or $0.90 per diluted common share for the quarter ended June 30, 2025. This compares to net inc ...

Core Viewpoint - Timberland Bancorp, Inc. reported strong financial results for the third fiscal quarter of 2025, with significant increases in net income and earnings per share, driven by net interest margin expansion and steady balance sheet growth [3][9]. Earnings Highlights - Net income for the quarter ended June 30, 2025, was $7.10 million, or $0.90 per diluted common share, representing a 5% increase from the previous quarter and a 20% increase year-over-year [1][9]. - For the first nine months of fiscal 2025, net income rose 16% to $20.72 million, or $2.60 per diluted common share, compared to $17.93 million, or $2.21 per diluted common share for the same period in fiscal 2024 [2][9]. - The quarterly return on average assets increased to 1.47%, and return on average equity rose to 11.23% [9][5]. Balance Sheet Highlights - Total assets increased by 1% from the prior quarter to $1.96 billion and grew 3% year-over-year [15][9]. - Total deposits rose by $18.65 million, or 1%, to $1.67 billion during the quarter, with significant increases in certificates of deposit and money market accounts [24][9]. - Total shareholders' equity increased by 2% from the prior quarter to $256.66 million, reflecting strong earnings and a stock repurchase program [28][9]. Net Interest Margin and Income - The net interest margin expanded to 3.80%, a one basis point increase from the prior quarter and a 27 basis point improvement year-over-year [3][9]. - Net interest income for the current quarter increased by 2% to $17.62 million, and for the first nine months of fiscal 2025, it rose by 9% to $51.81 million [8][10]. Stock Repurchase Program - The Board of Directors announced a new stock repurchase program allowing the company to repurchase up to 5% of outstanding shares, replacing the previous program [30][31]. Asset Quality - The non-performing assets to total assets ratio was 0.21% at June 30, 2025, compared to 0.13% at March 31, 2025, and 0.22% at June 30, 2024 [32][9]. - Total delinquent loans increased by 86% to $6.18 million, primarily due to one loan being past maturity [33][9]. Loan Portfolio - Net loans receivable increased by 2% during the quarter to $1.44 billion, with notable growth in multi-family and commercial real estate loans [17][9]. - Timberland originated $81.99 million in loans during the quarter, compared to $56.76 million for the preceding quarter [22][9].

Group 1 - Timberland Bancorp (NASDAQ: TSBK) has a robust balance sheet and a loan book with a low amount of loans past due, making it an attractive investment opportunity [1] - The investment group European Small Cap Ideas focuses on high-quality small-cap investment opportunities in Europe, emphasizing capital gains and dividend income for continuous cash flow [1] - The group offers two model portfolios: the European Small Cap Ideas portfolio and the European REIT Portfolio, along with weekly updates and educational content [1]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(unaudited)) This section presents Timberland Bancorp, Inc.'s unaudited consolidated financial statements, including balance sheets, income statements, and cash flows, for the periods ended March 31, 2025 [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets reached $1.93 billion as of March 31, 2025, with shareholders' equity increasing to $252.52 million Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 (Unaudited) | September 30, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$1,932,730** | **$1,923,475** | | Cash and cash equivalents | $191,211 | $164,728 | | Loans receivable, net | $1,420,074 | $1,421,523 | | Total deposits | $1,650,830 | $1,647,668 | | **Total Liabilities** | **$1,680,206** | **$1,678,062** | | **Total Shareholders' Equity** | **$252,524** | **$245,413** | [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income) Quarterly net income increased to $6.76 million, driven by higher net interest income, with diluted EPS reaching $0.85 Key Income Statement Data (in thousands, except per share amounts) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $17,213 | $15,635 | $34,182 | $31,639 | | Provision for Credit Losses | $246 | $81 | $272 | $417 | | Non-interest Income | $2,687 | $2,615 | $5,384 | $5,413 | | Non-interest Expense | $11,194 | $10,991 | $22,260 | $21,615 | | **Net Income** | **$6,755** | **$5,708** | **$13,615** | **$12,004** | | **Diluted EPS** | **$0.85** | **$0.70** | **$1.71** | **$1.47** | [Consolidated Statements of Comprehensive Income](index=8&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Total comprehensive income for the quarter ended March 31, 2025, was $6.88 million, primarily driven by net income Comprehensive Income (in thousands) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | Six Months Ended Mar 31, 2025 | Six Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $6,755 | $5,708 | $13,615 | $12,004 | | Other Comprehensive Income (Loss) | $122 | $82 | $(690) | $339 | | **Total Comprehensive Income** | **$6,877** | **$5,790** | **$12,925** | **$12,343** | [Consolidated Statements of Shareholders' Equity](index=9&type=section&id=Consolidated%20Statements%20of%20Shareholders%27%20Equity) Shareholders' equity increased to $252.52 million at March 31, 2025, primarily due to net income, offset by stock repurchases and dividends Changes in Shareholders' Equity (Six Months Ended Mar 31, 2025, in thousands) | Description | Amount | | :--- | :--- | | **Beginning Balance (Sep 30, 2024)** | **$245,413** | | Net Income | $13,615 | | Other Comprehensive Loss | $(690) | | Repurchase of Common Stock | $(2,792) | | Common Stock Dividends | $(3,980) | | Other (Stock Options, etc.) | $968 | | **Ending Balance (Mar 31, 2025)** | **$252,524** | [Consolidated Statements of Cash Flows](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash provided by operating activities was $9.30 million and by investing activities $20.11 million, leading to a $26.48 million increase in cash Cash Flow Summary (Six Months Ended, in thousands) | Cash Flow Category | March 31, 2025 | March 31, 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $9,298 | $8,975 | | Net Cash from Investing Activities | $20,109 | $(13,506) | | Net Cash from Financing Activities | $(2,924) | $56,159 | | **Net Increase in Cash** | **$26,483** | **$51,628** | [Notes to Unaudited Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) Notes detail accounting policies, investment securities, loans, and the Allowance for Credit Losses, confirming the company operates as a single community banking segment - The company has one reportable operating segment, defined as community banking in western Washington under the name 'Timberland Bank'[27](index=27&type=chunk) - The Allowance for Credit Losses (ACL) on loans was **$17.53 million** at March 31, 2025, compared to $17.48 million at September 30, 2024[47](index=47&type=chunk) - **Non-accrual loans decreased to $2.33 million** at March 31, 2025, from $3.89 million at September 30, 2024[68](index=68&type=chunk)[71](index=71&type=chunk) - As of March 31, 2025, the Company had commitments to extend credit and undisbursed lines of credit totaling **$220.22 million**[116](index=116&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=43&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition and operations, highlighting an 18.3% increase in quarterly net income, a 3.79% net interest margin, and improved asset quality [Overview](index=45&type=section&id=Overview) Timberland Bancorp, Inc. is a community bank with $1.93 billion in assets, whose profitability primarily depends on net interest income after credit loss provision - As of March 31, 2025, the Company had **total assets of $1.93 billion**, **net loans receivable of $1.42 billion**, and **total deposits of $1.65 billion**[128](index=128&type=chunk) - Profitability is primarily dependent on net interest income after the provision for credit losses[130](index=130&type=chunk) - A provision for credit losses on loans of **$0.24 million** was recorded for the quarter ended March 31, 2025, mainly due to changes in the loan portfolio's composition[132](index=132&type=chunk) [Comparison of Financial Condition](index=46&type=section&id=Comparison%20of%20Financial%20Condition) Total assets grew 0.5% to $1.93 billion, shareholders' equity rose 2.9% to $252.52 million, and non-performing assets decreased 34.2% to $2.59 million Financial Condition Changes (Mar 31, 2025 vs. Sep 30, 2024) | Item | Change ($M) | Change (%) | | :--- | :--- | :--- | | Total Assets | +$9.26 | +0.5% | | Net Loans Receivable | -$1.45 | -0.1% | | Total Deposits | +$3.16 | +0.2% | | Shareholders' Equity | +$7.11 | +2.9% | - **Non-performing assets decreased by $1.35 million (34.2%) to $2.59 million** at March 31, 2025, from $3.94 million at September 30, 2024, primarily due to a decrease in non-accrual loans[157](index=157&type=chunk) - The Commercial Real Estate (CRE) loan portfolio's largest collateral types at March 31, 2025, were **industrial/warehouse (21.2%)** and **medical/dental offices (14.0%)**[161](index=161&type=chunk) [Comparison of Operating Results](index=54&type=section&id=Comparison%20of%20Operating%20Results) Quarterly net income rose 18.3% to $6.76 million, driven by a 10.1% increase in net interest income and a 3.79% Net Interest Margin, reflecting improved efficiency Quarterly Performance Comparison (Q2 2025 vs. Q2 2024) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income | $6.76M | $5.71M | +18.3% | | Diluted EPS | $0.85 | $0.70 | +21.4% | | Net Interest Income | $17.21M | $15.64M | +10.1% | | Net Interest Margin | 3.79% | 3.48% | +31 bps | - The **efficiency ratio for Q2 2025 improved to 56.25%** from 60.22% in Q2 2024, indicating better profitability relative to expenses[194](index=194&type=chunk) - For the six months ended March 31, 2025, **net income increased 13.4% to $13.62 million** from $12.00 million in the prior year period[166](index=166&type=chunk) [Liquidity and Capital Resources](index=61&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity and remains 'well-capitalized' with significant borrowing capacity, increasing its quarterly dividend and continuing stock repurchases Bank Regulatory Capital Ratios (March 31, 2025) | Ratio | Actual | To Be "Well Capitalized" | | :--- | :--- | :--- | | Tier 1 Leverage Ratio | 12.49% | 5.00% | | Common Equity Tier 1 Ratio | 18.99% | 6.50% | | Tier 1 Capital Ratio | 18.99% | 8.00% | | Total Capital Ratio | 20.24% | 10.00% | - The Bank has significant available liquidity, including **$618.87 million in FHLB borrowing capacity** and **$76.03 million with the FRB** as of March 31, 2025[198](index=198&type=chunk) - The quarterly dividend was increased to **$0.26 per share**, and the active stock repurchase program had **65,998 shares remaining** for purchase as of March 31, 2025[207](index=207&type=chunk)[208](index=208&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=63&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No material changes in market risk disclosures were reported from the 2024 Form 10-K - There were no material changes in market risk disclosures from those reported in the 2024 Form 10-K[215](index=215&type=chunk) [Controls and Procedures](index=63&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of March 31, 2025, with no material changes to internal control over financial reporting during the quarter - The CEO and CFO concluded that as of March 31, 2025, the Company's disclosure controls and procedures were effective[216](index=216&type=chunk) - There were no changes in internal control over financial reporting during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, internal controls[216](index=216&type=chunk) [PART II. OTHER INFORMATION](index=64&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=64&type=section&id=Item%201.%20Legal%20Proceedings) Neither the company nor its subsidiary is a party to any material legal proceedings, though routine claims arise in the ordinary course of business - Neither the Company nor the Bank is a party to any material legal proceedings at this time[218](index=218&type=chunk) [Risk Factors](index=64&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors from the 2024 Form 10-K, except for a new risk concerning Artificial Intelligence use - A new risk factor has been added regarding the current and future uses of Artificial Intelligence (AI) and other emerging technologies[219](index=219&type=chunk) - AI-related risks include **model risk from flawed algorithms or biased data**, **cybersecurity threats**, **regulatory compliance issues** due to the opaque nature of some AI models, and potential operational failures[219](index=219&type=chunk)[220](index=220&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=64&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 61,764 shares at an average price of $30.85 during the quarter, with 65,998 shares remaining for repurchase Stock Repurchases (Quarter Ended March 31, 2025) | Period | Shares Repurchased | Average Price Paid | | :--- | :--- | :--- | | Jan 2025 | 0 | $— | | Feb 2025 | 41,764 | $31.25 | | Mar 2025 | 20,000 | $30.01 | | **Total** | **61,764** | **$30.85** | - As of March 31, 2025, **65,998 shares remained available for repurchase** under the Company's 19th stock repurchase plan announced on July 25, 2023[223](index=223&type=chunk) [Defaults Upon Senior Securities](index=66&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports that this item is not applicable - Not applicable[225](index=225&type=chunk) [Mine Safety Disclosures](index=66&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) The company reports that this item is not applicable - Not applicable[226](index=226&type=chunk) [Other Information](index=66&type=section&id=Item%205.%20Other%20Information) No other material information is disclosed, and no director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the quarter - During the quarter ended March 31, 2025, no director or officer adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement'[229](index=229&type=chunk) [Exhibits](index=67&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including corporate governance documents, employment agreements, and CEO/CFO certifications - The report includes required certifications from the Chief Executive Officer and Chief Financial Officer pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[231](index=231&type=chunk) - Financial statements and notes formatted in XBRL are included as Exhibit 101[231](index=231&type=chunk)

Financial Performance - Timberland Bancorp reported net income of $6.76 million, or $0.85 per diluted common share for Q2 2025, a decrease of 2% from the previous quarter but an increase of 18% year-over-year[1][9]. - For the first six months of fiscal 2025, net income increased 13% to $13.62 million, or $1.71 per diluted common share, compared to $12.00 million, or $1.47 per diluted common share for the same period in fiscal 2024[2][9]. - Net income for Q2 2025 was $6,755,000, a decrease of 1.53% from $6,860,000 in Q1 2025 and an increase of 18.34% from $5,708,000 in Q2 2024[39]. - Net income for the six months ended March 31, 2025, was $13,615,000, an increase of 13.43% from $12,004,000 for the same period in 2024[40]. Asset and Deposit Growth - Total assets increased by 1% to $1.93 billion, with a $27.14 million increase in cash and cash equivalents contributing to this growth[15][9]. - Total deposits increased by $20 million, or 1%, during the quarter, driven by increases in checking and certificates of deposit account balances[3][9]. - Total deposits rose by $20.41 million, or 1%, to $1.65 billion at March 31, 2025, driven by increases in certificates of deposit and NOW checking accounts[24]. - Total assets increased to $1,932,730 thousand as of March 31, 2025, up from $1,909,480 thousand at December 31, 2024, representing a growth of 1.3%[41]. - Total deposits reached $1,650,830 thousand, an increase from $1,630,416 thousand at the end of 2024, marking a growth of 1.3%[41]. Loan Portfolio - The loan portfolio grew by 1% from the prior quarter and 4% year-over-year, with net loans receivable reaching $1.42 billion[3][9][17]. - Total mortgage loans increased to $1,336.74 million, representing 88% of total loans as of March 31, 2025, compared to $1,277.46 million and 88% a year ago[19]. - Commercial loans totaled $131.40 million, accounting for 9% of total loans, with a slight decrease from $135.87 million in the previous year[19]. - Timberland originated $56.76 million in loans during the quarter, a decrease from $72.07 million in the prior quarter[22]. - Net loans receivable rose to $1,420,074 thousand, compared to $1,411,819 thousand at the end of 2024, reflecting an increase of 0.9%[41]. Income and Expenses - Total interest and dividend income for Q2 2025 was $24,865,000, a decrease of 1.55% from $25,257,000 in Q1 2025 and an increase of 7.37% from $23,156,000 in Q2 2024[39]. - Net interest income for Q2 2025 was $17,213,000, up 1.43% from $16,970,000 in Q1 2025 and up 9.73% from $15,635,000 in Q2 2024[39]. - Total non-interest income for Q2 2025 was $2,687,000, a slight decrease from $2,697,000 in Q1 2025 and an increase from $2,615,000 in Q2 2024[39]. - Total non-interest expense for Q2 2025 was $11,194,000, an increase from $11,067,000 in Q1 2025 and from $10,991,000 in Q2 2024[39]. Capital and Efficiency - The efficiency ratio improved to 56.25% from 56.27% in the previous quarter and 60.22% a year ago[9][13]. - Shareholders' equity increased by $3.32 million, or 1%, to $252.52 million, supported by net income of $6.76 million for the quarter[28]. - The total risk-based capital ratio stood at 20.29%, indicating strong capitalization as of March 31, 2025[29]. - Return on average assets improved to 1.43% for the three months ended March 31, 2025, up from 1.41% in the previous quarter and 1.22% a year ago[42]. - Return on average equity was 10.95% for Q2 2025, slightly down from 11.03% in Q1 2025 but up from 9.67% in Q2 2024[42]. - The efficiency ratio improved to 56.25% for Q2 2025, down from 56.27% in Q1 2025 and significantly better than 60.22% in Q2 2024[42]. Credit Quality - A provision for credit losses of $237,000 was recorded for the quarter, reflecting loan portfolio growth and changes in composition[11]. - Non-performing assets to total assets ratio improved to 0.13%, down from 0.19% a year ago, reflecting enhanced asset quality[30]. - Total delinquent loans decreased by $697,000, or 17%, to $3.32 million compared to the previous quarter[31]. - Non-performing assets decreased to $2,589 thousand, down from $2,999 thousand at December 31, 2024, indicating improved asset quality[42]. - The allowance for credit losses for loans was 1.22% of loans receivable, consistent with the previous year[30]. Dividends - The Board of Directors announced a 4% increase in the quarterly cash dividend to $0.26 per share, marking the 50th consecutive quarter of dividend payments[3][4]. Economic Outlook - The company anticipates continued challenges from economic conditions, including inflation and potential recession risks, which may impact future performance[37].

Core Viewpoint - Timberland Bancorp, Inc. reported a net income of $6.76 million for the quarter ended March 31, 2025, reflecting a slight decrease from the previous quarter but a significant increase compared to the same quarter last year, driven by improved net interest margins and a solid capital position [1][6][10]. Earnings Highlights - Net income for the first six months of fiscal 2025 increased 13% to $13.62 million, or $1.71 per diluted common share, compared to $12.00 million, or $1.47 per diluted common share for the same period in fiscal 2024 [2][6]. - Quarterly earnings per diluted common share (EPS) decreased 1% to $0.85 from $0.86 in the preceding quarter but increased 21% from $0.70 in the comparable quarter one year ago [5][6]. - The net interest margin (NIM) expanded to 3.79% for the current quarter, up from 3.64% in the previous quarter and 3.48% a year ago [5][10]. Balance Sheet Highlights - Total assets increased 1% to $1.93 billion at March 31, 2025, compared to $1.91 billion at December 31, 2024, and also increased 1% year-over-year [15][30]. - Total deposits rose by $20 million, or 1%, during the quarter to $1.65 billion, with increases in various account types including certificates of deposit and checking accounts [25][27]. - Total shareholders' equity increased 1% to $252.52 million, driven by net income and partially offset by dividends and stock repurchases [29][30]. Operating Results - Operating revenue for the current quarter increased 1% to $19.90 million from $19.67 million in the preceding quarter and increased 9% from $18.25 million a year ago [8]. - Net interest income rose by $243,000, or 1%, to $17.21 million for the current quarter, with a 10% increase year-over-year [9][10]. - Non-interest income decreased slightly by less than 1% to $2.69 million for the current quarter but increased 3% from the comparable quarter one year ago [12]. Loan Portfolio and Asset Quality - The loan portfolio grew by 1% from the prior quarter and 4% year-over-year, with net loans receivable at $1.42 billion [17][31]. - The non-performing assets to total assets ratio improved to 0.13% at March 31, 2025, down from 0.16% at December 31, 2024, and 0.19% a year ago [31][32]. - Provisions for credit losses on loans totaled $237,000 for the quarter, reflecting growth in the loan portfolio [10][31]. Dividend Announcement - The Board of Directors announced a 4% increase in the quarterly cash dividend to $0.26 per share, marking the 50th consecutive quarter of dividend payments [3][5].

Financial Position - Total assets decreased by $14.00 million, or 0.7%, to $1.91 billion at December 31, 2024, from $1.92 billion at September 30, 2024[136]. - Total deposits decreased by $17.25 million, or 1.0%, to $1.63 billion at December 31, 2024, primarily due to decreases in money market and non-interest bearing account balances[138]. - Cash and cash equivalents and CDs held for investment decreased by $3.40 million, or 1.9%, to $171.54 million at December 31, 2024[140]. - Investment securities decreased by $11.19 million, or 4.6%, to $234.03 million at December 31, 2024, primarily due to maturities and prepayments[141]. - The principal amount of loans serviced for Freddie Mac and SBA decreased by $7.46 million to $363.10 million at December 31, 2024, from $370.56 million at September 30, 2024[148]. - The Bank's liquid assets increased to $249.46 million at December 31, 2024, up from $248.06 million at September 30, 2024[185]. - Timberland Bancorp had liquid assets of $1.73 million on an unconsolidated basis as of December 31, 2024[189]. Loan Performance - Net loans receivable decreased by $9.70 million, or 0.7%, to $1.41 billion at December 31, 2024, primarily due to decreases in commercial business and commercial real estate loans[137]. - Loan originations decreased by $16.86 million, or 19.1%, to $72.07 million for the three months ended December 31, 2024, from $88.93 million for the same period in 2023[144]. - The Company recorded a decrease in commercial business loans by $3.43 million and commercial real estate loans by $2.17 million during the reporting period[143]. - The Bank originated $72.07 million in loans during the three months ended December 31, 2024, compared to $88.93 million in the same period of 2023[183]. Income and Expenses - Net income increased by $564,000, or 9.0%, to $6.86 million for the quarter ended December 31, 2024, compared to $6.30 million for the same quarter in 2023[160]. - Total interest and dividend income increased by $2.76 million, or 12.3%, to $25.26 million for the quarter ended December 31, 2024, from $22.50 million for the same quarter in 2023[162]. - Net interest income rose by $966,000, or 6.0%, to $16.97 million for the quarter ended December 31, 2024, from $16.00 million for the same quarter in 2023[161]. - Total non-interest income decreased by $101,000, or 3.6%, to $2.70 million for the quarter ended December 31, 2024, from $2.80 million for the same quarter in 2023[176]. - Total non-interest expense increased by $443,000, or 4.2%, to $11.07 million for the quarter ended December 31, 2024, from $10.62 million for the same quarter in 2023[177]. - Total interest expense increased by $1.80 million, or 27.6%, to $8.29 million for the quarter ended December 31, 2024, from $6.49 million for the same quarter in 2023[164]. Credit Quality - The provision for credit losses on loans was $52,000 for the three months ended December 31, 2024, compared to $379,000 for the same period in 2023[131]. - A provision for credit losses of $27,000 was recorded for the quarter ended December 31, 2024, compared to $336,000 for the same quarter in 2023[171]. - Net charge-offs were $242,000 for the quarter ended December 31, 2024, compared to $2,000 for the same quarter in 2023[172]. - Non-performing assets decreased by $937,000, or 23.8%, to $3.00 million at December 31, 2024, from $3.94 million at September 30, 2024[152]. Shareholders' Equity - Shareholders' equity increased by $3.79 million, or 1.5%, to $249.20 million at December 31, 2024, primarily due to net income and proceeds from stock option exercises[139]. - Total shareholders' equity increased by $3.79 million, or 1.5%, to $249.20 million at December 31, 2024, from $245.41 million at September 30, 2024[151]. - The current quarterly common stock dividend rate is $0.25 per share, resulting in an average total dividend of approximately $1.99 million per quarter[190]. Regulatory and Capital Ratios - The Bank's Tier 1 capital was $233.57 million, with a Tier 1 capital ratio of 12.23% as of December 31, 2024[195]. - As of December 31, 2024, the Bank's regulatory liquidity ratio was 12.92%[180]. - The Bank had undisbursed lines of credit and commitments to extend credit totaling $131.54 million as of December 31, 2024[183]. Efficiency Metrics - The efficiency ratio improved slightly to 56.27% for the current quarter compared to 56.50% for the same quarter one year ago[177]. - The efficiency ratio improved to 56.27% for the three months ended December 31, 2024, compared to 56.50% in 2023[197]. Interest Margin - The net interest margin increased to 3.64% for the quarter ended December 31, 2024, up from 3.60% for the same quarter in 2023[165]. - The average balance of total interest-earning assets increased by $75.76 million, or 4.3%, to $1.85 billion for the quarter ended December 31, 2024, compared to $1.78 billion for the same quarter in 2023[163]. - The average balance of loans receivable increased by $105.17 million, or 7.9%, while the average balance of interest-bearing deposits in banks and CDs increased by $40.51 million, or 32.1%[163]. Taxation - The provision for income taxes increased by $167,000, or 10.8%, to $1.71 million for the quarter ended December 31, 2024, from $1.55 million for the same quarter in 2023[178].

[Financial Performance Summary (Q1 FY2025)](index=1&type=section&id=Financial%20Performance%20Summary%20(Q1%20FY22025)) Timberland Bancorp reported strong Q1 FY2025 results with increased net income, improved profitability ratios, and expanded net interest margin [Overview of Quarterly Results](index=1&type=section&id=Overview%20of%20Quarterly%20Results) Timberland Bancorp reported strong Q1 FY2025 net income of **$6.86 million** and **$0.86** diluted EPS, reflecting sequential and year-over-year growth, alongside a declared quarterly dividend | Metric | Q1 FY2025 (ended Dec 31, 2024) | Q4 FY2024 (ended Sep 30, 2024) | Q1 FY2024 (ended Dec 31, 2023) | | :--- | :--- | :--- | :--- | | Net Income | $6.86 million | $6.36 million | $6.30 million | | Diluted EPS | $0.86 | $0.79 | $0.77 | - Year-over-year, net income and EPS increased by **9%** and **12%**, respectively. Sequentially, they grew by **8%** and **9%**[2](index=2&type=chunk) - The Board of Directors announced a quarterly cash dividend of **$0.25 per share**, marking the 49th consecutive quarterly cash dividend[2](index=2&type=chunk) [Key Performance Metrics](index=1&type=section&id=Key%20Performance%20Metrics) Key profitability ratios improved in Q1 FY2025, with ROA at **1.41%**, ROE at **11.03%**, NIM at **3.64%**, and an improved efficiency ratio of **56.27%** | Performance Metric | Q1 FY2025 (ended Dec 31, 2024) | Q4 FY2024 (ended Sep 30, 2024) | Q1 FY2024 (ended Dec 31, 2023) | | :--- | :--- | :--- | :--- | | Return on Average Assets (ROA) | 1.41% | 1.32% | 1.36% | | Return on Average Equity (ROE) | 11.03% | 10.43% | 10.75% | | Net Interest Margin (NIM) | 3.64% | 3.58% | 3.60% | | Efficiency Ratio | 56.27% | 56.79% | 56.50% | - Tangible book value per share continued its upward trend, increasing to **$29.37** at quarter-end[2](index=2&type=chunk)[5](index=5&type=chunk) [Operating Results](index=2&type=section&id=Operating%20Results) Operating results for the quarter showed increased net interest income driven by an expanded net interest margin, reduced credit loss provisions, and stable non-interest expenses [Net Interest Income and Margin (NIM)](index=2&type=section&id=Net%20Interest%20Income%20and%20Margin%20(NIM)) Net interest income for the quarter increased **3%** sequentially to **$16.97 million**, with the net interest margin expanding to **3.64%** due to lower funding costs - Net interest income rose to **$16.97 million**, a **3%** increase from the preceding quarter and a **6%** increase from the year-ago quarter[7](index=7&type=chunk) - The NIM expanded to **3.64%** from **3.58%** in the prior quarter, driven by a reduction in funding costs as the weighted average cost of interest-bearing liabilities fell **8 basis points**[2](index=2&type=chunk)[7](index=7&type=chunk) - The current quarter's NIM was positively impacted by approximately **3 basis points** due to the collection of **$115,000** in pre-payment penalties, non-accrual interest, and late fees[7](index=7&type=chunk) [Provision for Credit Losses](index=2&type=section&id=Provision%20for%20Credit%20Losses) The company recorded a modest provision for credit losses on loans of **$52,000**, a significant decrease from the prior quarter, partially offset by recaptures on unfunded commitments and investment securities | Provision/Recapture Category | Q1 FY2025 (ended Dec 31, 2024) | Q4 FY2024 (ended Sep 30, 2024) | | :--- | :--- | :--- | | Provision for credit losses - loans | $52,000 | $444,000 | | Recapture of credit losses - unfunded commitments | ($20,000) | ($59,000 provision) | | Recapture of credit losses - investment securities | ($5,000) | ($13,000) | [Non-Interest Income and Expense](index=3&type=section&id=Non-Interest%20Income%20and%20Expense) Non-interest income decreased by **8%** sequentially to **$2.70 million**, mainly due to lower gain on sales of loans, while non-interest expenses remained relatively flat - Non-interest income fell to **$2.70 million** from **$2.93 million** in the prior quarter, primarily due to a decrease in gain on sales of loans[10](index=10&type=chunk) - Operating expenses were stable at **$11.07 million**, a slight increase from **$11.06 million** in the preceding quarter[11](index=11&type=chunk) [Balance Sheet Analysis](index=3&type=section&id=Balance%20Sheet%20Analysis) The balance sheet reflects a slight decrease in total assets and deposits, a stable loan portfolio composition, and robust capital adequacy with strong liquidity [Asset and Liquidity Position](index=3&type=section&id=Asset%20and%20Liquidity%20Position) Total assets decreased by **1%** to **$1.91 billion**, while the company maintained a strong liquidity position with substantial secured borrowing capacity and a diversified deposit base - Total assets stood at **$1.91 billion** as of December 31, 2024, a **1%** decrease from the prior quarter but a **1%** increase year-over-year[5](index=5&type=chunk)[13](index=13&type=chunk) - The company has significant off-balance sheet liquidity, with **$656 million** in available secured borrowing line capacity through the FHLB and the Federal Reserve[5](index=5&type=chunk)[14](index=14&type=chunk) - Only **19%** of Timberland's deposits were uninsured or uncollateralized at December 31, 2024, indicating a strong and diversified deposit base[14](index=14&type=chunk) [Loan Portfolio](index=3&type=section&id=Loan%20Portfolio) Net loans receivable decreased by **1%** to **$1.41 billion** despite higher originations, with mortgage loans comprising **88%** of the stable portfolio composition - Net loans receivable decreased by **$9.70 million**, or **1%**, during the quarter to **$1.41 billion**[15](index=15&type=chunk) - Loan originations increased to **$72.07 million** during the quarter, compared to **$48.82 million** in the preceding quarter[20](index=20&type=chunk) [Overall Loan Portfolio Composition](index=4&type=section&id=Overall%20Loan%20Portfolio%20Composition) As of December 31, 2024, total loans were **$1.52 billion**, with commercial real estate and one- to four-family mortgage loans being the largest categories | Loan Category | Amount (Dec 31, 2024) | Percent of Total | | :--- | :--- | :--- | | **Mortgage Loans** | **$1,332.6M** | **88%** | | - Commercial | $597.1M | 39% | | - One- to four-family | $306.4M | 20% | | - Multi-family | $177.9M | 12% | | - Construction (all types) | $220.0M | 15% | | **Commercial Loans** | **$135.5M** | **9%** | | **Consumer Loans** | **$51.7M** | **3%** | | **Total Loans** | **$1,519.9M** | **100%** | [Commercial Real Estate (CRE) Portfolio](index=5&type=section&id=Commercial%20Real%20Estate%20(CRE)%20Portfolio) The Commercial Real Estate (CRE) portfolio totaled **$597.1 million**, representing **39%** of the total loan portfolio, diversified across various collateral types with industrial warehouse properties as the largest segment | CRE Collateral Type | Balance | % of CRE Portfolio | % of Total Loan Portfolio | | :--- | :--- | :--- | :--- | | Industrial warehouse | $126.4M | 21% | 8% | | Medical/dental offices | $84.8M | 14% | 6% | | Office buildings | $67.6M | 11% | 4% | | Other retail buildings | $52.3M | 9% | 3% | | **Total CRE** | **$597.1M** | **100%** | **39%** | [Deposits](index=5&type=section&id=Deposits) Total deposits decreased by **1%** to **$1.63 billion**, driven by shifts from non-interest-bearing accounts to higher-yielding certificates of deposit - Total deposits decreased by **$17.25 million**, or **1%**, to **$1.63 billion** at December 31, 2024[22](index=22&type=chunk) | Deposit Category | Amount (Dec 31, 2024) | Percent of Total | | :--- | :--- | :--- | | Non-interest-bearing demand | $402.9M | 25% | | NOW checking | $323.4M | 20% | | Money market | $311.4M | 19% | | Savings | $206.8M | 13% | | Certificates of deposit (CDs) | $385.8M | 23% | | **Total Deposits** | **$1,630.4M** | **100%** | [Shareholders' Equity and Capital Adequacy](index=6&type=section&id=Shareholders'%20Equity%20and%20Capital%20Adequacy) Shareholders' equity increased by **2%** to **$249.20 million**, supported by net income and share repurchases, with capital ratios remaining well above regulatory requirements - Total shareholders' equity increased by **$3.79 million** (**2%**) during the quarter to **$249.20 million**[26](index=26&type=chunk) - The company repurchased **27,260 shares** of common stock at an average price of **$32.38 per share**[26](index=26&type=chunk) - The bank remains well-capitalized, with a total risk-based capital ratio of **19.95%** and a tangible common equity to tangible assets ratio of **12.34%**[27](index=27&type=chunk) [Asset Quality](index=6&type=section&id=Asset%20Quality) Asset quality improved with a decrease in non-performing assets and non-accrual loans, while the allowance for credit losses remained strong [Non-Performing Assets and Delinquencies](index=6&type=section&id=Non-Performing%20Assets%20and%20Delinquencies) Asset quality metrics improved, with non-performing assets to total assets decreasing to **0.16%** and non-accrual loans falling **30%** to **$2.73 million** - The non-performing assets to total assets ratio improved to **0.16%** at Dec 31, 2024, down from **0.20%** at Sep 30, 2024[28](index=28&type=chunk) - Non-accrual loans decreased by **$1.15 million**, or **30%**, to **$2.73 million** from **$3.89 million** in the prior quarter[29](index=29&type=chunk) | Non-Accrual Loan Category | Amount (Dec 31, 2024) | Amount (Sep 30, 2024) | | :--- | :--- | :--- | | Commercial business loans | $1,401k | $2,060k | | Mortgage loans | $745k | $1,207k | | Consumer loans | $587k | $618k | | **Total Non-Accrual Loans** | **$2,733k** | **$3,885k** | - The allowance for credit losses (ACL) for loans was **1.21%** of loans receivable, stable with the prior quarter, and provided coverage of **633%** of non-accrual loans[28](index=28&type=chunk)[38](index=38&type=chunk) [Financial Statements](index=9&type=section&id=Financial%20Statements) The consolidated financial statements provide a detailed overview of the company's income and financial position for the quarter [Consolidated Statements of Income](index=9&type=section&id=Consolidated%20Statements%20of%20Income) For the three months ended December 31, 2024, the company reported total interest income of **$25.26 million** and net income of **$6.86 million** after provisions and non-interest items | Income Statement (in thousands) | Three Months Ended Dec 31, 2024 | | :--- | :--- | | Net Interest Income | $16,970 | | Provision for Credit Losses (Net) | $27 | | Net Interest Income after Provision | $16,943 | | Total Non-interest Income | $2,697 | | Total Non-interest Expense | $11,067 | | Income Before Income Taxes | $8,573 | | **Net Income** | **$6,860** | [Consolidated Balance Sheets](index=11&type=section&id=Consolidated%20Balance%20Sheets) As of December 31, 2024, Timberland Bancorp's balance sheet showed total assets of **$1.91 billion**, with **$1.41 billion** in net loans and **$1.63 billion** in total deposits | Balance Sheet (in thousands) | As of Dec 31, 2024 | | :--- | :--- | | **Assets** | | | Total Cash and Cash Equivalents | $164,071 | | Net Loans Receivable | $1,411,819 | | Investment Securities (Net) | $234,025 | | **Total Assets** | **$1,909,480** | | **Liabilities & Equity** | | | Total Deposits | $1,630,416 | | FHLB Borrowings | $20,000 | | **Total Liabilities** | **$1,660,281** | | **Total Shareholders' Equity** | **$249,199** | [Supplementary Information](index=12&type=section&id=Supplementary%20Information) Supplementary information includes reconciliations of GAAP to non-GAAP financial measures, providing additional insights into capital adequacy [Non-GAAP Financial Measures](index=14&type=section&id=Non-GAAP%20Financial%20Measures) The company provides non-GAAP measures like tangible common equity and tangible assets to offer a broader understanding of capital adequacy by excluding intangible assets Reconciliation of GAAP to Non-GAAP Measures (in thousands) | Measure | Dec 31, 2024 | Sep 30, 2024 | | :--- | :--- | :--- | | Shareholders' Equity (GAAP) | $249,199 | $245,413 | | Less: Goodwill and CDI | ($15,537) | ($15,582) | | **Tangible Common Equity (Non-GAAP)** | **$233,662** | **$229,831** | | Total Assets (GAAP) | $1,909,480 | $1,923,475 | | Less: Goodwill and CDI | ($15,537) | ($15,582) | | **Tangible Assets (Non-GAAP)** | **$1,893,943** | **$1,907,893** |

Core Viewpoint - Timberland Bancorp, Inc. reported a solid start to its 2025 fiscal year with improvements in net income, earnings per share, and profitability metrics compared to the prior quarter and the same quarter last year [2][5]. Earnings Highlights - Net income for the quarter ended December 31, 2024, was $6.86 million, or $0.86 per diluted common share, representing an 8% increase from $6.36 million in the previous quarter and a 9% increase from $6.30 million a year ago [1][5]. - Earnings per diluted common share increased 9% from $0.79 in the previous quarter and 12% from $0.77 a year ago [4][5]. - Return on average assets rose to 1.41% and return on average equity increased to 11.03% [4][11]. Balance Sheet Highlights - Total assets decreased by 1% to $1.91 billion from the previous quarter but increased by 1% year-over-year [14][11]. - Total deposits decreased by $17 million, or 1%, during the quarter, while total borrowings remained unchanged at $20 million [11][24]. - Total shareholders' equity increased by 2% from the previous quarter to $249.20 million, reflecting a strong capital position [28][11]. Operating Results - Operating revenue increased by 1% to $19.67 million from the previous quarter and by 5% from a year ago [7]. - Net interest income rose by 3% to $16.97 million compared to the previous quarter and by 6% from the same quarter last year [8]. - Non-interest income decreased by 8% to $2.70 million from the previous quarter, primarily due to a decrease in gains on sales of loans [10]. Loan Portfolio - Net loans receivable decreased by 1% to $1.41 billion during the quarter, influenced by an increase in loan payoffs [16][11]. - Timberland originated $72.07 million in loans during the quarter, compared to $48.82 million in the previous quarter [22]. Asset Quality - Non-performing assets to total assets ratio improved to 0.16% from 0.20% in the previous quarter [30]. - Total delinquent loans decreased by 10% to $4.02 million, and non-accrual loans decreased by nearly 30% to $2.73 million [31][30]. Liquidity - Liquidity remained strong, with cash and cash equivalents representing 15.0% of total liabilities at December 31, 2024 [15]. - Timberland had secured borrowing line capacity of $656 million available through the Federal Home Loan Bank and the Federal Reserve [15].

Core Points - Timberland Bancorp reported a net income of $6.86 million, or $0.86 per diluted common share for the quarter ended December 31, 2024, representing an increase of 8% from the previous quarter and 9% year-over-year [1][5][41] - The company experienced improvements in key performance metrics, including a 9% increase in earnings per share compared to the prior quarter and a 12% increase year-over-year [2][5] - A quarterly cash dividend of $0.25 per share was announced, marking the 49th consecutive quarter of dividend payments [2] Earnings Highlights - Quarterly earnings per diluted common share increased 9% to $0.86 from $0.79 for the preceding quarter and 12% from $0.77 for the comparable quarter one year ago [5][4] - Net income increased 8% to $6.86 million for the current quarter from $6.36 million for the preceding quarter and 9% from $6.30 million for the comparable quarter one year ago [5][4] Balance Sheet Highlights - Total assets decreased 1% from the prior quarter to $1.91 billion, while increasing 1% year-over-year [11][14] - Total shareholders' equity increased 2% from the prior quarter to $249.20 million, and increased 5% year-over-year [28] - The non-performing assets to total assets ratio improved to 0.16% at December 31, 2024, compared to 0.20% at September 30, 2024 [31] Operating Results - Operating revenue for the current quarter increased 1% to $19.67 million from $19.48 million for the preceding quarter and increased 5% from $18.80 million for the comparable quarter one year ago [7] - Net interest income increased 3% to $16.97 million for the current quarter from $16.55 million for the preceding quarter and increased 6% from $16.00 million for the comparable quarter one year ago [8] - Non-interest income decreased 8% to $2.70 million for the current quarter from $2.93 million for the preceding quarter [10] Loan and Deposit Activity - Total deposits decreased 1% during the quarter to $1.63 billion, with a notable decrease in money market account balances [24][26] - Net loans receivable decreased 1% during the quarter to $1.41 billion, primarily due to an increase in the undisbursed portion of construction loans [16][22] - Timberland originated $72.07 million in loans during the quarter, compared to $48.82 million for the preceding quarter [22] Credit Quality - The provision for credit losses on loans was recorded at $52,000 for the quarter, significantly lower than the $444,000 provision for the preceding quarter [9] - Total delinquent loans decreased 10% to $4.02 million at December 31, 2024, from $4.49 million at September 30, 2024 [32]