Financial Data and Key Metrics Changes - The company reported a fully diluted EPS of $0.38, a 65% increase compared to the prior year [4][12] - Net income for the quarter was $0.38 per diluted share, up 65% over the prior year [12] - Return on average assets was 1.19% and return on average equity was 14.15% [13] - Net interest margin (NIM) was 3.10%, down slightly from the prior quarter [13][22] - Efficiency ratio improved to 52.79% [13] - Tangible book value per share increased by $0.42 to $11.23 [13] Business Line Data and Key Metrics Changes - Average loans increased by $205.3 million or 11.5% compared to Q1 2024 [7][18] - Average deposits grew by $166.6 million or 8.1% compared to the same quarter last year [7] - Loan production was robust, with end-of-period net loan growth of $63.4 million or 13% annualized compared to the prior quarter [19] - Non-interest income was 16.3% of total revenue, consistent with prior quarters and higher than Q1 2024 [34] Market Data and Key Metrics Changes - The Florida economy is forecasted to grow steadily in 2025, with a growing labor force and low unemployment [7][40] - The company anticipates high-single digit to low double-digit loan and deposit growth in the upcoming quarters [7][41] Company Strategy and Development Direction - The company emphasizes relationship-driven organic growth and has onboarded additional senior bankers to support business lending and deposit production [6][8] - The strategy includes cautious optimism regarding economic uncertainties and a focus on maintaining credit quality [6][41] - The company plans to continue disciplined expense control to improve operating leverage [41] Management's Comments on Operating Environment and Future Outlook - Management noted heightened volatility in the market due to recent tariff announcements but expressed cautious optimism about the diversified business lines [5][6] - The company is prepared for both upward and downward shifts in interest rates, reflecting a neutral balance sheet position [25] - The management expects to see improvements in non-performing assets and classified loans in the upcoming quarters [82] Other Important Information - The Board of Directors declared a cash dividend of $0.10 per share, to be paid on June 5, 2025 [9][10] - The company has a strong focus on maintaining a robust balance sheet while returning capital to investors [10] Q&A Session Summary Question: What drove the deposit growth in the quarter? - The deposit growth was seen in key areas like correspondent banking and business banking, with a balanced contribution from various segments [47] Question: What is the outlook for NIM? - The guidance for NIM is flat to slightly up, with expectations of rate cuts benefiting deposit costs [49][54] Question: What is the impact of specialty verticals on deposits? - New hires in production personnel for various verticals are expected to support continued deposit growth [60] Question: How should we think about the expense base moving forward? - The expense base is expected to gradually increase due to new hires and performance-based bonuses [65] Question: What is the focus regarding capital? - The focus remains on organic growth rather than buybacks, given solid growth prospects [66] Question: What is the outlook for credit quality? - Management anticipates improvements in non-performing and classified loans in the second quarter [82]

Financial Data and Key Metrics Changes - The company reported a fully diluted EPS of $0.38, a 65% increase over the prior year [4] - Net income for the quarter was $0.38 per diluted share, up 65% over the prior year [8] - Return on average assets was 1.19% and return on average equity was 14.15% [9] - Net interest margin (NIM) was 3.1%, down slightly from the prior quarter [9] - The efficiency ratio improved to 52.79% [9] - Tangible book value per share increased by $0.42 to $11.23 [9] Business Line Data and Key Metrics Changes - Average loans increased by $205.3 million or 11.5% compared to Q1 2024 [5] - Average deposits grew by $166.6 million or 8.1% compared to the same quarter last year [5] - The loan pipeline remains robust and diversified, with expectations for high single-digit to low double-digit loan and deposit growth in Q2 [6] Market Data and Key Metrics Changes - The Florida economy is forecasted to grow steadily in 2025, with a growing labor force and low unemployment [5] - The company surpassed the $2 billion loan mark, achieving a significant milestone [8] Company Strategy and Development Direction - The company emphasizes relationship-driven organic growth and has onboarded additional senior bankers to support business lending and deposit production [6][29] - The strategic focus is on maintaining credit quality and carefully vetting new loan production amid economic uncertainties [4][29] - The company plans for disciplined expense control to improve operating leverage [29] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the economic environment, particularly in light of recent trade deal progress [4] - The company anticipates continued growth in loans and deposits, tempered by economic uncertainties related to trade policies [29] - The management team is focused on maintaining a strong balance sheet while returning capital to investors through dividends [6][28] Other Important Information - The Board of Directors declared a cash dividend of $0.10 per share, to be paid on June 5, 2025 [6] - Noninterest income was 16.3% of total revenue, consistent with prior quarters [25] Q&A Session Summary Question: What drove the deposit growth in the quarter? - Management noted positive growth in Correspondent Banking and business banking, contributing to balanced deposit growth [36] Question: What is the outlook for NIM given the current conditions? - Management expects NIM to be flat to slightly up, anticipating potential rate cuts that could benefit deposit costs [38][40] Question: What is the impact of specialty verticals on deposits? - New hires in various verticals are expected to enhance deposit growth, particularly in HOA and business banking [46][48] Question: How should the expense base be viewed moving forward? - The expense base is expected to gradually increase due to new hires and performance-based bonuses [50] Question: What is the focus regarding capital growth? - The focus remains on organic growth rather than buybacks, given solid growth prospects [52]

Group 1: Earnings Performance - USCB Financial Holdings, Inc. reported quarterly earnings of $0.38 per share, matching the Zacks Consensus Estimate and showing an increase from $0.23 per share a year ago [1] - The company had a previous expectation of $0.37 per share but reported $0.34, resulting in a surprise of -8.11% [1] - Over the last four quarters, USCB has surpassed consensus EPS estimates two times [1] Group 2: Revenue Performance - For the quarter ended March 2025, USCB Financial posted revenues of $22.83 million, missing the Zacks Consensus Estimate by 0.92% and increasing from $17.62 million year-over-year [2] - The company has topped consensus revenue estimates three times over the last four quarters [2] Group 3: Stock Performance and Outlook - USCB Financial shares have increased by approximately 2.1% since the beginning of the year, contrasting with the S&P 500's decline of -8.6% [3] - The future performance of the stock will depend on management's commentary during the earnings call and the company's earnings outlook [4][6] - The current consensus EPS estimate for the upcoming quarter is $0.39 on revenues of $23.8 million, and for the current fiscal year, it is $1.58 on revenues of $96.44 million [7] Group 4: Industry Context - The Banks - Southeast industry, to which USCB Financial belongs, is currently in the top 25% of over 250 Zacks industries, indicating a favorable outlook [8] - Research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1 [8]

Core Viewpoint - USCB Financial Holdings, Inc. reported a record net income of $7.7 million or $0.38 per fully diluted share for Q1 2025, reflecting strong performance across strategic priorities and significant growth in loans and deposits compared to the same period in 2024 [1][2]. Profitability - Net income for Q1 2025 was $7.7 million, up from $4.6 million in Q1 2024, representing a 67.4% increase [1][20]. - The annualized return on average assets was 1.19% for Q1 2025, compared to 0.76% for Q1 2024 [7][25]. - The annualized return on average stockholders' equity was 14.15% for Q1 2025, up from 9.61% in Q1 2024 [7][25]. - The efficiency ratio improved to 52.79% in Q1 2025 from 63.41% in Q1 2024 [7][25]. Balance Sheet - Total assets increased to $2.7 billion as of March 31, 2025, a rise of $188.2 million or 7.6% from $2.5 billion a year earlier [7][22]. - Total loans held for investment reached $2.0 billion, up $215.0 million or 11.8% from $1.8 billion in Q1 2024 [7][22]. - Total deposits grew to $2.3 billion, an increase of $206.8 million or 9.8% from $2.1 billion in Q1 2024 [7][22]. - Total stockholders' equity was $225.1 million, reflecting a $30.1 million or 15.4% increase from $195.0 million in Q1 2024 [7][22]. Asset Quality - The allowance for credit losses increased by $3.3 million to $24.7 million, representing 1.22% of total loans as of March 31, 2025, compared to 1.18% a year earlier [7][22]. - The ratio of non-performing loans to total loans was 0.20% at March 31, 2025, up from 0.03% at March 31, 2024, with non-performing loans totaling $4.2 million compared to $456 thousand a year earlier [7][22]. Non-interest Income and Non-interest Expense - Non-interest income for Q1 2025 was $3.7 million, an increase of $1.3 million or 50.8% from $2.5 million in Q1 2024 [6][20]. - Non-interest expense rose to $12.1 million, an increase of $0.9 million or 7.9% compared to $11.2 million in Q1 2024 [8][20].

Financial Performance - USCB Financial Holdings reported a record fully diluted EPS of $0.38 for Q1 2025, a 65% increase from $0.23 in Q1 2024[1][2]. - Net income for Q1 2025 was $7.7 million, compared to $4.6 million in the same period last year, reflecting a significant year-over-year growth[1][2]. - Net income for Q1 2025 reached $7,658 million, compared to $4,612 million in Q1 2024, reflecting a significant increase of 66.4%[21]. - The company reported a pre-tax pre-provision (PTPP) income of $10,779,000 for Q1 2025, up from $6,448,000 in Q1 2024, a significant increase of 67.5%[30]. - The operating return on average assets for Q1 2025 was 1.19%, up from 0.76% in Q1 2024, indicating improved asset utilization[30]. Asset Growth - Total assets increased by $188.2 million or 7.6% to $2.7 billion as of March 31, 2025, compared to $2.5 billion a year earlier[6]. - Total assets as of March 31, 2025, were $2,677,382 million, up from $2,489,142 million a year earlier, indicating a growth of 7.6%[21]. - Total assets as of March 31, 2025, were $2,606,593,000, up from $2,436,103,000 as of March 31, 2024, indicating a growth of 7%[30]. - Average assets for Q1 2025 were $2,606,593,000, compared to $2,436,103,000 in Q1 2024, reflecting a year-over-year increase of 7%[30]. Loan and Deposit Growth - Total loans held for investment rose by $215.0 million or 11.8% to $2.0 billion in Q1 2025, compared to $1.8 billion in Q1 2024[6]. - Total deposits grew by $206.8 million or 9.8% to $2.3 billion as of March 31, 2025, compared to $2.1 billion a year earlier[6]. - Total deposits increased to $2,309,569 million as of March 31, 2025, compared to $2,102,794 million a year ago, marking a growth of 9.8%[21]. Income and Efficiency - Net interest income for Q1 2025 was $19,115 million, an increase from $15,158 million in Q1 2024, representing a year-over-year growth of 26.5%[21]. - The net interest margin improved to 3.10% in Q1 2025 from 2.62% in Q1 2024, reflecting enhanced profitability on interest-earning assets[27]. - The efficiency ratio improved to 52.79% in Q1 2025 from 63.41% in Q1 2024, reflecting better cost management[6]. - The operating efficiency ratio decreased to 52.79% in Q1 2025 from 63.41% in Q1 2024, indicating improved cost management[30]. Dividends and Shareholder Returns - The Company declared a quarterly cash dividend of $0.10 per share, up from $0.05 in the previous year, to be paid on June 5, 2025[13]. - Cash dividends declared increased to $0.10 per share in Q1 2025, compared to $0.05 per share in Q1 2024[21]. Credit Quality - The provision for credit losses was $681 thousand in Q1 2025, an increase of $271 thousand from $410 thousand in Q1 2024[13]. - The allowance for credit losses to total loans ratio remained stable at 1.22% as of March 31, 2025[24]. - Non-performing loans increased to $4,156 million as of March 31, 2025, from $456 million in Q1 2024, indicating a rise in asset quality concerns[24]. Capital Position - The leverage ratio improved to 9.61% as of March 31, 2025, compared to 8.91% a year earlier, reflecting a stronger capital position[21]. - The tangible book value per common share increased to $11.23 as of March 31, 2025, compared to $9.92 a year earlier, marking a growth of 13.2%[33].

Core Viewpoint - USCB Financial Holdings, Inc. is set to report its financial results for the quarter ended March 31, 2025, on April 24, 2025, after market close [1] Group 1: Financial Reporting - The financial results will be discussed in a conference call on April 25, 2025, at 11:00 am Eastern Time, featuring key executives including the Chairman, President, and CEO, Luis de la Aguilera [1][2] - A live audio webcast of the conference call will be available on the investor relations page of the Company's website [2] - A replay of the webcast will be archived shortly after the conference call concludes [3] Group 2: Company Overview - USCB Financial Holdings, Inc. is the bank holding company for U.S. Century Bank, established in 2002, and is one of the largest community banks in Miami and Florida [4] - U.S. Century Bank holds a 5-Star rating from BauerFinancial, indicating strong financial health [4] - The bank offers a wide range of financial products and services and actively supports community organizations [4]

Group 1 - USCB Financial Holdings, Inc. (USCB) shares increased by 5.5% to close at $19.33, following a solid trading volume, contrasting with a 4.5% loss over the past four weeks [1] - The stock rally is attributed to the Federal Reserve's decision to keep interest rates steady, which is expected to improve the company's net interest income and margin [2] - USCB is projected to report quarterly earnings of $0.38 per share, reflecting a year-over-year increase of 65.2%, with revenues anticipated at $23.04 million, up 30.8% from the previous year [2] Group 2 - The consensus EPS estimate for USCB has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [4] - USCB Financial holds a Zacks Rank of 3 (Hold), while another company in the same industry, Origin Bancorp (OBK), has a Zacks Rank of 1 (Strong Buy) [4] - Origin Bancorp's consensus EPS estimate is $0.68, which is a decrease of 6.9% compared to the previous year [5]

Regulatory Environment - The company operates in a highly regulated environment, subject to extensive regulation and supervision by federal and state agencies, which could adversely affect its operations and financial condition [230]. - The company is required to maintain a Common Equity Tier 1 (CET1) capital ratio of 7.0% or more, a Tier 1 capital ratio of 8.5% or more, and a total capital ratio of 10.5% or more under Basel III rules [238]. - The company currently meets the Basel III capital requirements but may face challenges in maintaining compliance in the future, which could impact growth initiatives and investor confidence [239]. - The company has dedicated significant resources to its anti-money laundering program due to increased regulatory scrutiny, especially in high-risk areas like South Florida [233]. - Regulatory changes, such as those from the Dodd-Frank Act, could impose additional compliance costs and operational restrictions on the company [232]. - The company may incur costs related to improving its internal control systems to comply with Section 404 of the Sarbanes-Oxley Act [228]. - The company faces risks of noncompliance with the Bank Secrecy Act, which could lead to significant penalties and reputational damage [233]. - The company is subject to periodic examinations by banking agencies, which could result in remedial actions that negatively impact its operations [241]. - The company must obtain regulatory approvals for many activities, and failure to do so could restrict its business operations [230]. - Heightened regulatory scrutiny following recent banking stresses could lead to increased compliance costs and operational risks for the company [236]. - The company is subject to numerous laws and regulations, including the Community Reinvestment Act, which could lead to sanctions if not complied with [243]. Financial Performance - Total assets increased to $2,581,216 thousand in 2024 from $2,339,093 thousand in 2023, representing a growth of 10.4% [456]. - Net income rose to $24,674 thousand in 2024, up 49% from $16,545 thousand in 2023 [459]. - Total interest income increased to $131,233 thousand in 2024, a 30% increase from $101,017 thousand in 2023 [459]. - Loans held for investment grew to $1,948,778 thousand in 2024, compared to $1,759,743 thousand in 2023, marking an increase of 10.7% [456]. - Total deposits reached $2,174,004 thousand in 2024, up 12.2% from $1,937,139 thousand in 2023 [456]. - Net interest income after provision for credit losses was $66,779 thousand in 2024, a 19% increase from $56,201 thousand in 2023 [459]. - Non-interest income increased to $12,740 thousand in 2024, up 72% from $7,403 thousand in 2023 [459]. - The provision for credit losses was $3,157 thousand in 2024, compared to $2,367 thousand in 2023, reflecting a 33.4% increase [459]. - Total stockholders' equity increased to $215,388 thousand in 2024 from $191,968 thousand in 2023, a rise of 12.1% [456]. - Net income per share, basic, increased to $1.25 in 2024 from $0.84 in 2023, representing a growth of 49% [459]. - Net cash provided by operating activities rose to $34,090 thousand in 2024, up from $22,546 thousand in 2023, an increase of 51.2% [471]. - The net increase in deposits for 2024 was $236,865 thousand, compared to $107,858 thousand in 2023, reflecting a growth of 119.5% [471]. - Cash and cash equivalents at the end of 2024 were $77,035 thousand, up from $41,062 thousand at the end of 2023, marking an increase of 87.6% [471]. - The net cash used in investing activities decreased to $211,861 thousand in 2024 from $273,002 thousand in 2023, a reduction of 22.4% [471]. - The company reported interest paid of $60,544 thousand in 2024, up from $41,306 thousand in 2023, an increase of 46.5% [471]. - The net cash provided by financing activities was $213,744 thousand in 2024, compared to $237,350 thousand in 2023, a decrease of 10.0% [471]. Loan Portfolio and Credit Quality - The Company had a concentration of risk with loans outstanding to the top ten lending relationships totaling $236.2 million, representing 12.0% of net loans outstanding as of December 31, 2024 [509]. - The Company segments its loan portfolio based on collateral codes to establish reserves, utilizing regression models based on peer data for loans of similar risk characteristics [502]. - The Company’s loan portfolio is concentrated largely in real estate and commercial loans in South Florida, which could be adversely impacted by negative conditions in the local economy [507]. - The Company applies qualitative adjustments to expected credit losses to account for risk factors not captured in quantitative analysis [503]. - The allowance for credit losses (ACL) was $24.1 million as of December 31, 2024, compared to $21.1 million in 2023, indicating a rise of 14.2% [573]. - The provision for credit losses for 2024 was $2,960 thousand, compared to $2,503 thousand in 2023, indicating a 18.2% increase year-over-year [578]. - Total loans outstanding increased from $1,778,644 thousand as of December 31, 2023, to $1,965,218 thousand as of December 31, 2024, reflecting a growth of 10.5% [590]. - The total balance of collectively evaluated loans rose from $20,811 thousand in 2023 to $23,352 thousand in 2024, marking a 12.9% increase [579]. - The company reported a total of $2,280 thousand in substandard loans as of December 31, 2024, compared to $9,481 thousand in 2023, indicating a decrease of 76.0% [590]. - The total charge-offs for 2024 were $19 thousand, compared to $57 thousand in 2023, showing a decrease of 66.7% [578]. - The company’s recoveries increased from $85 thousand in 2023 to $45 thousand in 2024, reflecting a decrease of 47.1% [578]. - As of December 31, 2024, total accruing loans amounted to $1,962,511 thousand, with non-accruing loans totaling $2,707 thousand [592]. - Non-accrual loans with related allowance as of December 31, 2024, were $2,393 thousand, compared to $468 thousand in 2023, reflecting a significant increase [596]. - The company had two collateral-dependent loans as of December 31, 2024, with a recorded investment of $1,990 thousand [599]. Securities and Investments - The total amortized cost of available-for-sale investment securities as of December 31, 2024, was $310.9 million, with unrealized losses amounting to $51.2 million, resulting in a fair value of $260.2 million [551]. - For the year ended December 31, 2024, the proceeds from sales and calls of available-for-sale securities were $34.8 million, with net realized gains of $14 thousand [556]. - The allowance for credit losses on securities held-to-maturity was reported as $(6) thousand, indicating a minimal impact on the overall financial position [551]. - The total unrealized losses retained in accumulated other comprehensive income (AOCI) for securities transferred from available-for-sale to held-to-maturity was $9.3 million as of December 31, 2024 [555]. - The company reported a total of $164.7 million in held-to-maturity securities, net of allowance for credit losses, as of December 31, 2024 [551]. - The company monitors credit quality of held-to-maturity securities quarterly, with all such securities rated investment grade as of December 31, 2024 [564]. - The unrealized losses on investment securities were attributed to changes in interest rates rather than credit quality, reflecting management's assessment [567]. - The company had $66.1 million in securities pledged to the State of Florida under the public funds program as of December 31, 2024, down from $86.9 million in 2023 [569]. Accounting and Reporting - The company has elected to use an extended transition period for complying with new accounting standards, which may affect the comparability of its financial statements with other public companies [256]. - The adoption of ASU 2016-13 on January 1, 2023, resulted in an increase to the allowance for credit losses (ACL) on loan receivables of $1.1 million and a reserve for unfunded commitments of $259 thousand, leading to a cumulative adjustment of $1.0 million in accumulated deficit [545]. - As of January 1, 2023, 84% or $1.3 billion of loan receivables were evaluated under the Discounted Cash Flow (DCF) method, while 16% or $251 million were evaluated under the Remaining Life method [543]. - The company implemented ASU 2022-02 concurrently with ASU 2016-13, enhancing disclosures related to troubled debt restructurings [546]. - The impact of adopting CECL included an increase in the allowance for credit losses and adjustments to the deferred tax asset, reflecting changes in credit loss measurement methodologies [545]. Corporate Governance and Ownership - Significant investors, including Patriot Financial Partners and Priam Capital Fund, own approximately 22.4% and 22.5% of the company's Class A common stock, respectively, influencing corporate governance and decision-making [257]. - The company's ability to pay dividends is subject to restrictions and depends on the profitability of its bank subsidiary, which is regulated by the FDIC [248]. - The market price and trading volume of the company's Class A common stock may be volatile, influenced by various external factors unrelated to its performance [249]. - The company's governing documents include provisions that may have an anti-takeover effect, potentially delaying or preventing acquisitions [260].

Financial Data and Key Metrics - Diluted EPS increased from $0 14 in Q4 2023 to $0 34 in Q4 2024, more than doubling year-over-year [3] - Net interest margin expanded due to the company's focus on reducing deposit costs, contributing to solid profitability [3] Business Line Performance - The company achieved strong gains in assets, deposits, diversified quality loan production, and profitability, driven by disciplined execution of its commercial banking initiatives [3] Market Performance - The company benefited from Florida's strong, resilient, and growing economy, which supported its performance [3] Strategic Direction and Industry Competition - The company's business plan focuses on commercial banking initiatives aimed at profitably expanding existing client relationships and growing new ones [3] Management Commentary on Operating Environment and Future Outlook - Management highlighted the company's record year, outperforming internal budgets and delivering impressive results for shareholders [3] - The company's performance underscores its disciplined execution and focus on profitability [3] Other Important Information - The company's Q4 2024 results were reviewed by the President and CEO, CFO, and Chief Credit Officer, with highlights commencing on Slide 3 [2] Q&A Session - No Q&A session details were provided in the content

EARNINGS PRESENTATION FOURTH QUARTER 2024 NASDAQ: USCB FORWARD-LOOKING STATEMENTS This presentation may contain statements that are not historical in nature and are intended to be, and are hereby identified as, forward-looking statements for purposes of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are those that are not historical facts. The words "may," "will," "anticipate," "could," " should," "would," "believe," "contemplate," "exp ...