Heritage Financial (US:HFWA)2025-05-06 16:32Financial Performance - Net income for the three months ended March 31, 2025, was $13,911 thousand, a significant increase of 142.5% from $5,748 thousand in the same period of 2024[16]. - Basic earnings per share increased to $0.41 for Q1 2025, compared to $0.17 for Q1 2024, reflecting a growth of 141.2%[16]. - Other comprehensive income for Q1 2025 was $11,898 thousand, compared to $1,791 thousand in Q1 2024, showing a substantial improvement[18]. - Net income for the three months ended March 31, 2025, was $13,911,000, a significant increase from $5,748,000 in the same period of 2024, representing a growth of 142%[23]. - Net cash provided by operating activities increased to $19,253,000 in Q1 2025 from $12,899,000 in Q1 2024, reflecting a growth of 49%[23]. - Income before income taxes increased to $16,159 thousand in Q1 2025 from $6,868 thousand in Q1 2024, a change of $9,291 thousand[142]. - The effective income tax expense for the three months ended March 31, 2025, was $2.248 million, compared to $1.120 million for the same period in 2024[111]. Asset and Liability Management - Total assets increased to $7,129,862 thousand as of March 31, 2025, compared to $7,106,278 thousand at December 31, 2024, reflecting a growth of 0.33%[14]. - Total liabilities remained stable at $6,248,347 thousand as of March 31, 2025, compared to $6,242,751 thousand at December 31, 2024[14]. - Total deposits increased to $5,845,335 thousand as of March 31, 2025, up 2.83% from $5,684,613 thousand at the end of 2024[14]. - Total cash and cash equivalents at the end of the period rose to $248,660,000, compared to $189,647,000 at the end of Q1 2024, marking an increase of 31%[23]. - The company’s total capital ratio is 13.6%, exceeding the regulatory minimum of 8.0% for "adequately capitalized" institutions[165]. - The Company maintains a leverage ratio of 10.2% as of March 31, 2025, above the regulatory minimum of 4.0%[165]. Credit Quality and Loan Performance - The provision for credit losses decreased significantly to $51 thousand in Q1 2025 from $1,392 thousand in Q1 2024, indicating improved credit quality[16]. - The allowance for credit losses (ACL) on loans is $52,160,000 as of March 31, 2025, slightly down from $52,468,000, indicating a reduction of about 0.59%[54]. - As of March 31, 2025, there were no loans graded as Doubtful or Loss, maintaining a stable credit quality profile[59]. - The company actively monitors credit quality indicators, including trends in risk grades and nonperforming loans, to manage its loan portfolio effectively[56]. - The total past due loans as of March 31, 2025, were $9,325,000, with $8,339,000 categorized as 30-89 days past due and $986,000 as 90 days or more past due[64]. - The total gross charge-offs for the three months ended March 31, 2025, were $376,000, compared to $200,000 for the same period in 2024, reflecting an increase of 88%[62]. Investment Securities - As of March 31, 2025, the total investment securities held to maturity amounted to $697,561,000 with a fair value of $632,648,000, reflecting a gross unrealized loss of $64,941,000[40]. - The total investment securities available for sale were valued at $835,592,000 with a fair value of $764,394,000, resulting in gross unrealized losses of $72,283,000[42]. - The company reported net realized losses of $3,887,000 for the three months ended March 31, 2025, compared to $9,973,000 for the same period in 2024[46]. - The fair value of investment securities held to maturity was $632,648,000 as of March 31, 2025, compared to a carrying value of $697,561,000[104]. Dividends and Shareholder Returns - The company declared dividends of $0.24 per share in Q1 2025, slightly up from $0.23 per share in Q1 2024[16]. - The Company declared a cash dividend of $0.24 per share on January 22, 2025, reflecting a slight increase from the previous dividend of $0.23 per share[91]. - The Company authorized a new stock repurchase program on April 24, 2024, allowing the repurchase of up to 5% of outstanding common shares, totaling 1,734,492 shares, with 990,522 shares remaining available for repurchase as of March 31, 2025[92]. Market and Economic Conditions - The estimated effect on net interest income for a +200 basis points shock is an increase of $3.3 million (1.4%) as of March 31, 2025[173]. - The Company expects to fund LIHTC commitments totaling $31.4 million during the year ending December 31, 2025[108]. - The Company has not experienced any material changes in critical accounting estimates during the three months ended March 31, 2025[169]. - There have been no material changes to the risk factors outlined in the Company's 2024 Annual Form 10-K[180].