First National (US:FXNC)2025-04-30 13:31Financial Performance - First National Corporation reported earnings of $1.52 million for Q1 2025, with adjusted earnings of $3.1 million, resulting in adjusted earnings per share of $0.35[1][4] - The company reported net income of $1,598,000 for the quarter, compared to a net loss of $933,000 in Q4 2024, marking a turnaround in profitability[30] - Basic earnings per common share for Q1 2025 was $0.18, compared to a loss of $0.10 in Q4 2024[31] - Adjusted earnings per common share for Q1 2025 was $0.35, down from $0.66 in Q4 2024[31] - Adjusted operating net income (non-GAAP) for Q1 2025 was $3,157,000, a decrease from $5,955,000 in Q4 2024[33] Asset and Deposit Growth - Total assets reached $2.033 billion, a 40.5% increase from the previous year, while total deposits increased to $1.825 billion, up 44.9% year-over-year[6][13] - Total assets as of March 31, 2025, were $2,033,346,000, an increase from $2,010,281,000 at the end of the previous quarter, representing a growth of 1.16%[35] - Total deposits rose to $1,824,976 thousand, compared to $1,803,778 thousand, reflecting an increase of 1.2%[32] - Noninterest-bearing demand deposits increased to $540,387 thousand, up from $520,153 thousand, a growth of 3.0%[32] Interest Income and Expenses - Net interest income for Q1 2025 was $17.5 million, a decrease of $908 thousand from the previous quarter, attributed to amortization on early payoffs of Touchstone loans[5] - Total interest and dividend income was $24,022,000, a decrease from $25,486,000 in the previous quarter[30] - Interest expense decreased to $6,571,000 from $7,127,000 in the previous quarter, reflecting lower borrowing costs[30] - Interest expense on deposits was $6,038,000 for the three months ended March 31, 2025, compared to $6,415,000 in the previous quarter, a decrease of 5.87%[35] Non-Interest Income and Expenses - Non-interest income decreased to $3.6 million in Q1 2025, down from $6.4 million in the prior quarter, primarily due to a one-time bargain purchase gain in Q4 2024[7] - Total noninterest income for the quarter was $3,611,000, down from $6,444,000 in the previous quarter, indicating a decline in service-related revenues[30] - Total noninterest expense was $18,335,000, a decrease from $21,929,000 in the previous quarter, showing cost management efforts[30] Credit Quality and Allowance for Credit Losses - The allowance for credit losses on loans was $14.7 million, or 1.02% of total loans, with a provision for credit losses of $832 thousand in Q1 2025[21] - Nonperforming assets as a percentage of total assets decreased to 0.24% in Q1 2025, compared to 0.35% in Q4 2024[17][18] - Provision for credit losses was $832,000, significantly lower than $4,750,000 in the previous quarter, indicating improved credit quality[30] - Nonperforming assets as of Q1 2025 totaled $4,864,000, down from $7,024,000 in Q4 2024[31] Capital and Efficiency Ratios - Total capital as of Q1 2025 was $182,563,000, up from $181,449,000 in Q4 2024[31] - Tier 1 capital to risk-weighted assets ratio for Q1 2025 was 11.39%, compared to 11.19% in Q4 2024[31] - The efficiency ratio improved to 52.0% from 61.0% in the previous quarter, demonstrating enhanced operational efficiency[30] - The efficiency ratio (non-GAAP) for Q1 2025 was 75.44%, compared to 63.97% in Q4 2024[34] Future Outlook - The company plans to continue focusing on cost management and improving operational efficiency in future quarters[28]