SmartFinancial, Inc. (SMBK) Q1 2025 Earnings Conference Call April 22, 2025 10:00 AM ET Company Participants Operator - Conference Call OperatorBrett Trabaton - Hovde GroupEzra - Call CoordinatorNathan Stroll - Director of Investor RelationsRon Garzynski - Chief Financial OfficerMellor Welburn - Chairman of the BoardBilly Carroll - President and Chief Executive OfficerChristopher Marinak - Representative, Janey Montgomery ScottSteve Moss - Raymond JamesRussell Gunther - Stevens Conference Call Participants ...

United Community Banks, Inc. (UCBI) Q1 2025 Earnings Conference Call April 22, 2025 09:00 AM ET Company Participants Operator - Pre-call Disclosure / Conference IntroductionModerator - Conference Call ModeratorLynn Harten - Company Executive (Presenter)Rob - Credit/Portfolio OfficerRich - Executive RepresentativeJefferson - Chief Financial Officer (CFO) Conference Call Participants Gary Tenner - Analyst, D.A. DavidsonRussell Gunther - Analyst, StevensMultiple Analysts (Steven Scouten of Piper Sandler; Micha ...

Financial Data and Key Metrics Changes - In Q1, the company delivered over 6,500 homes, achieving gross margins of 27.5%, with net income of $523 million, translating to $2.57 per share, down from $663 million or $3.10 per share in Q1 2024 [10][36][37] - The trailing 12-month return on equity was reported at 25.4% [10] - Home sale revenues totaled $3.7 billion, a decrease of 2% from $3.8 billion in the previous year [24] Business Line Data and Key Metrics Changes - Net new orders totaled 7,765 homes, a decrease of 7% year-over-year, with a 10% decrease in net new orders per store [21] - The average spend on options and lot premiums per home increased to $110,000 in Q1, up from $102,000 and $107,000 in the first and fourth quarters of the previous year [13] - The cancellation rate increased slightly to 11% compared to 10% in the prior year [21] Market Data and Key Metrics Changes - The company noted that 20% of its divisions were able to increase prices due to a drop in the 30-year mortgage rate below 7% [13] - The financial strength of move-up and active adult home buyers led to 60% of the portfolio being aligned to serve these key buyer groups [14] Company Strategy and Development Direction - The company aims to balance price and pace to drive high returns, prioritizing price over volume in the current environment [29][45] - The land investment for 2025 is expected to be approximately $5 billion, reflecting a more prudent approach in the current market [39][46] - The company plans to deliver between 29,000 and 30,000 homes for the full year, slightly below prior guidance of 31,000 [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term demand dynamics within the housing industry, despite current macroeconomic uncertainties [48] - The company is prepared to adjust land spending in response to changes in buyer demand, while maintaining a strong financial position [40][42] - Management acknowledged the volatility in consumer demand due to economic concerns but remains optimistic about future sales [17][90] Other Important Information - The company reported a gross margin of 27.5% in Q1, flat sequentially but down from the previous year [32] - SG&A expenses for Q1 were $393 million, or 10.5% of home sale revenues, compared to $358 million, or 9.4% of home sale revenues in the prior year [33] Q&A Session Summary Question: Second half margin expectations and tariff impact - Management confirmed that the incentive load for orders in Q1 was consistent with the 8% realized in deliveries, and the tariff impact is estimated at 1% of average sales price, approximately $5,000 [56][57] Question: Share repurchases - The company repurchased $300 million in shares during the quarter and has $1.9 billion remaining under its share repurchase authorization [60][61] Question: Cash flow guidance - The cash flow guide of $1.4 billion assumes homes needed to meet the delivery target, with adjustments made for land spend [64][66] Question: Market conditions and demand - Management acknowledged persistent demand but noted that exceeding this demand could require significant price reductions [73][76] Question: Tariff impact and guidance changes - The tariff impact is expected primarily in the fourth quarter, with specific categories identified, and the guidance reflects adjustments based on current market conditions [108][109] Question: Land spend and growth intentions - The reduction in land spend to $5 billion signals a prudent approach, with no impact on long-term growth plans [112][116]

Financial Data and Key Metrics Changes - The company's top line was somewhat softer than expectations, but overall results were consistent with the full-year plan [7] - Organic sales growth for the first quarter was slightly below expectations, while profitability was in line, supported by strong productivity delivery [18][19] - The company is targeting a volume and mix-based organic growth for the year that is ahead of the categories in its markets [22] Business Line Data and Key Metrics Changes - The company is on track to generate approximately $200 million of SG&A savings in the next few years [9] - The first quarter saw a decline in North America private label shipments, impacting total company organic sales [20] Market Data and Key Metrics Changes - Weighted average category growth was expected to be around 2% but was in the 1.5% to 2% range for the first quarter [19] - The company faced lower year-on-year North America private label shipments, which represented about 40 basis points to total company organic sales [20] Company Strategy and Development Direction - The company continues to execute its "Powering Care" strategy, focusing on differentiation, productivity, and agility [10][11] - The strategy includes delivering stronger differentiation at every rung of the good-better-best ladder and enabling a faster, more agile organization [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to execute the plan despite external headwinds, emphasizing the importance of innovation and consumer value propositions [26][27] - The company is addressing a $300 million tariff impact, with two-thirds attributed to US tariffs on China, and is working to mitigate these costs through supply chain adjustments [56][60] Other Important Information - The company is maintaining its investments in innovation and marketing despite the cost pressures from tariffs [81] - The management highlighted the importance of affordability for consumers, especially in the current economic environment [71] Q&A Session Summary Question: Organic growth performance in North America - Management acknowledged that organic sales were below expectations and discussed factors affecting this, including a lower category growth rate and strategic pricing investments [18][19][20] Question: Impact of tariffs on costs - Management detailed the $300 million tariff impact, with two-thirds coming from US tariffs on China, and discussed strategies to mitigate these costs [56][60] Question: Pricing strategy and consumer behavior - Management emphasized the importance of maintaining product quality while managing pricing and highlighted the shift towards more affordable product offerings [71][72] Question: Guidance on EPS growth - Management explained that the primary change in guidance was due to the $300 million gross impact from tariffs, while still planning to invest in innovation and marketing [117][120] Question: Savings program and productivity - Management confirmed that they are ahead of their productivity savings targets and are optimistic about future savings opportunities [149][151]

Financial Data and Key Metrics Changes - Total GPC sales for Q1 2025 were $5.9 billion, up 0.4% year-over-year, primarily driven by acquisitions and improving sales in the industrial business, partially offset by one less selling day impacting sales growth by 110 basis points [18] - Adjusted EPS for Q1 2025 was $1.75, down 21% from the prior year, influenced by one less selling day, lower pension income, higher depreciation and interest expense, and foreign currency headwinds [36] - Gross margin increased by 120 basis points to 37.1% in Q1 2025, driven by acquisitions and favorable vendor rebates [38] Business Segment Performance Changes - Global industrial segment sales were approximately flat at $2.2 billion, with comparable sales decreasing less than 1%, negatively impacted by one less selling day [19] - Global automotive segment sales increased by 0.5%, with comparable sales decreasing by 0.8%, also affected by one less selling day [24] - In the automotive segment, total sales in the U.S. were up approximately 4%, while comparable sales declined approximately 3% [25] Market Performance Changes - In Canada, total sales increased approximately 5% in local currency, with comparable sales up approximately 4% [28] - European total sales increased approximately 3% in local currency, with comparable sales essentially flat [29] - Asia Pacific delivered double-digit growth in local currency, with total sales up approximately 12% and comparable sales growth of approximately 3% [30] Company Strategy and Industry Competition - The company is focused on enhancing customer service and executing strategic initiatives to improve operational efficiency [12][15] - The rollout of the modernized e-commerce platform, Napa ProLink, is aimed at improving customer experience and driving sales growth [16] - The company continues to pursue acquisitions to strengthen its market position, with 44 stores acquired from independent owners and competitors [27] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a dynamic external environment influenced by tariffs, trade, inflation, and interest rates, which are creating a cautious demand backdrop [12][13] - The company maintains its outlook for 2025, expecting diluted EPS in the range of $6.95 to $7.45 and adjusted diluted EPS between $7.75 and $8.25 [45] - Management expressed cautious optimism about a potential recovery in the second half of 2025, despite current market softness [51] Other Important Information - The company incurred $69 million in pre-tax adjustments related to restructuring and acquisitions during Q1 2025 [35] - Cash from operations was down $41 million, and free cash flow decreased by approximately $160 million due to investments in inventory and capital expenditures [42][43] - The company returned approximately $135 million to shareholders through dividends during the quarter [44] Q&A Session Summary Question: What was the inflation impact in Q1 for both motion and automotive businesses? - Inflation was slightly less than one point across both businesses, with SG&A costs increasing around 2% [65][66] Question: How is the performance in Europe Automotive relative to the market? - The company is seeing growth in Napa branded products, with market share in line or slightly better than the market [69][70] Question: Update on North American auto and independent store acquisitions? - The company added approximately 40-45 stores and will continue to focus on running great stores while moderating acquisition pace [74][76] Question: Is there a scenario that could improve the tariff situation? - If tariffs are resolved quickly, it could lead to a more robust second half, but currently, the company is in a wait-and-see mode [80][81] Question: What is the cost impact of current tariffs on goods? - The complexity of tariffs makes it difficult to quantify the exact cost impact, as it varies by product and country of origin [107][110] Question: How are independent owners navigating the current environment? - There has not been a significant rush to stock up on inventory due to tariffs, and the company is working with owners to ensure they are appropriately stocked [125][126]

Sify Technologies (SIFY) Q4 2025 Earnings Call April 22, 2025 08:29 AM ET Company Participants Praveen Krishna - Deputy General ManagerRaju Vegesna - Chairman & Managing DirectorM P Vijay Kumar - Executive Director & Group CFOJonathan Atkin - Managing Director Conference Call Participants Gregory Burns - Analyst Operator Greetings. Welcome to the SIFI Technologies Financial Results for Full Year '20 '20 four-twenty '20 '5. At this time, all participants are in a listen only mode. A question and answer sessi ...

Financial Data and Key Metrics Changes - Total revenue for the first quarter of 2024 was 197.1 million RMB, compared to 149.1 million RMB a year ago, reflecting a significant increase [30] - Gross margin improved to 48.3%, driven by customer loyalty towards private labels and effective product creation strategies [31] - Net loss was 85 million RMB, compared to 65.9 million RMB a year ago, indicating a worsening financial position [34] Business Line Data and Key Metrics Changes - Revenue from sales and merchandise was 75.5 million RMB, while revenue from the marketplace business was 19.4 million RMB, showing growth in both segments [30] - The ProBioDisc bonus achieved sales of nearly 5 million RMB in Q1 2024 and over 6 million RMB in Q1 2025, indicating strong performance in organic health products [11][13] Market Data and Key Metrics Changes - The user repurchase rate maintained a strong 71.9%, reflecting consumer trust in the company's offerings [8] - The new Qingran coffee launched in March 2024 generated over 5 million RMB in sales within half a month, showcasing rapid market acceptance [11][13] Company Strategy and Development Direction - The company aims to strengthen its private label brand, Suye, and expand its product lines to enhance customer value and drive growth [15][16] - A strategic upgrade from Suye's messaging to its visual identity was completed, focusing on advanced skincare technology [15] - The company is evolving into a service experience platform, particularly through innovative tea therapy wellness courses, to build health-focused communities [24] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of organic health as a strategic goal and highlighted the need for operational alignment and efficiency improvements [6][9] - The company plans to maintain financial discipline while strategically investing to drive sustainable growth and improve profitability [36] - Future initiatives will focus on product innovation and enhancing core competencies to create greater social value for Chinese families [25] Other Important Information - The Jianxing Tea Therapy Program is set to launch in May 2025, combining tea tasting, meditation, and stretching lessons to promote holistic health [19][50] - The program aims to strengthen community ties and drive sales of organic health products, integrating cultural experiences with wellness [50] Q&A Session Summary Question: Can you provide more color about the upcoming T3P project? - The Jianxing Tea Therapy product will launch in May, offering a unique wellness experience that combines tea with a ritualized service model, promoting a healthy lifestyle [42] - The program includes an 18-minute experience with traditional stretching, tea tasting, and meditation, aimed at self-healing and community engagement [46][48]

Financial Data and Key Metrics Changes - Total assets increased by approximately $37 million during Q1 2025 [8] - Net income for Q1 2025 was $8.6 million, equating to $0.76 per basic share, down from $0.88 per share in the previous quarter but up from $0.58 per share in Q1 2024 [12] - The net interest margin (NIM) improved to 0.7% in Q1 2025, up from 0.54% in Q4 2024 and 0.16% in Q1 2024 [13] - Total equity increased by $6.7 million, primarily due to net income and employee stock option exercises [11] Business Line Data and Key Metrics Changes - The loan book decreased by $23 million in Q1 2025, with a strong loan pipeline anticipated for Q2 [5][22] - Non-interest income decreased by $693,000 compared to the previous quarter, primarily due to elevated non-interest income in Q4 2024 [17] - Non-interest expense increased by $1.3 million, mainly due to employee compensation and related benefits [19] Market Data and Key Metrics Changes - The Texas economy remains strong and growing, with no negative impacts observed from national economic uncertainties [3][4] - Non-performing assets (NPAs) remained low at 0.15% of total assets, slightly improved from 0.16% at year-end [24] Company Strategy and Development Direction - The company is focused on maintaining a granular and stable core deposit base, with plans to open 10,000 checking accounts this year [60] - The strategy includes systematic investment in the bond portfolio as opportunities arise, utilizing cash flows from maturing securities [66] - The company anticipates a 2% to 5% net growth in the deposit book for the year [61] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the loan portfolio and the quality of the customer base, despite national uncertainties [71] - The company is prepared for potential economic slowdowns while also being positioned for future growth [7][30] - Management does not expect to build reserves unless significant systemic concerns arise [46][50] Other Important Information - The company increased its dividend to $0.25 per share in Q1 2025, up from $0.24 per share in 2024 [12] - The liquidity ratio improved to 0.8% compared to 0.5% at year-end [30] Q&A Session Summary Question: Can you provide insights on the loan pipeline and its composition? - The loan pipeline is strong and similar to the current loan portfolio composition, with opportunities across all regions [39] Question: What are clients looking for to feel comfortable in the current environment? - Clients are cautious due to national uncertainties but see strength in local markets [44] Question: Can you elaborate on the CNI loan portfolio and the recent contraction? - The contraction was primarily due to lower utilization and paydowns in CNI lines [58] Question: What is the outlook for deposit growth for the full year? - The company anticipates a 2% to 5% net growth in deposits, focusing on core deposit relationships [61] Question: What is the plan for cash flows from the securities portfolio? - The plan is to systematically add to the bond portfolio as opportunities arise [66] Question: What areas of the portfolio are being closely monitored for credit risks? - The company is monitoring customers with potential direct impacts from tariffs, but currently sees no significant concerns [71] Question: What is the company's approach to share repurchases? - The company views share repurchases as a good utilization of excess capital and plans to continue this strategy [81] Question: What is the target for the expense to average asset ratio? - The target remains around 2.5%, with flexibility to adjust based on revenue and growth opportunities [84]

Financial Data and Key Metrics Changes - The company reported net income of $12.2 million, or $0.63 per share, with adjusted net income at $11.8 million, or $0.61 per share [11] - Net interest income increased to $36.4 million, up by $3.5 million or 11% on a linked quarter basis, with a margin of 229 basis points, reflecting a 34 basis point improvement [12] - Total loans decreased by $42 million or 1% from the previous quarter, including a 1% reduction in both residential and commercial loans [16] - In-market deposits reached an all-time high of $5.13 billion, up by $195 million or 4% [17] - Total equity increased to $522 million, up by $22 million from the end of Q4 [17] - The CET1 capital ratio improved by 56 basis points to 11.76% [18] Business Line Data and Key Metrics Changes - Wealth management revenues decreased to $9.9 million, down by $158,000 or 2% [13] - Mortgage banking revenues totaled $2.3 million, down by $544,000 or 19% [13] - The mortgage pipeline at March 31 was $95 million, up by $35 million or 59% from the end of December [14] Market Data and Key Metrics Changes - Broker deposits decreased by $270 million, and FHLB borrowings were down by $275 million, reflecting increases in deposits and cash redeployment [17] - The loan-to-deposit ratio decreased from 105.5% to 100.7% [17] Company Strategy and Development Direction - The company is focused on deposit growth strategies, achieving results in both in-market deposits and new households [7] - Retail branches are competing effectively, supplemented by a team of retail sales officers dedicated to enhancing loan and deposit opportunities [8] - The company aims for low single-digit growth in loans, with a strong pipeline building [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving low single-digit growth in loans despite challenges in the mortgage portfolio [30] - The company is closely monitoring the Fed's rate policy, with expectations for a net interest margin of 235 basis points for the next quarter [35] - Management indicated that the effective tax rate for the full year is expected to be 22.4% [16] Other Important Information - A pre-tax non-cash pension settlement charge of $6.4 million was recognized within non-interest expenses [14] - The allowance for credit losses totaled $41.1 million, providing MPL coverage of 190% [18] Q&A Session Summary Question: Impact of sale-leaseback and pension curtailment on operating costs - The sale-leaseback adds about $700,000 to occupancy and equipment costs annually, and there are no ongoing expenses related to the pension [24][26] Question: Size and complexion of loan pipelines - The commercial pipeline is a little over $100 million, with strong early-stage activity [30] Question: Expectations for net interest margin - The company anticipates a steady rise in net interest margin, with guidance limited to the next quarter [35] Question: Dividend payout ratio targets - The company aims to lower the dividend payout ratio, expecting to be in the mid to low 80s by the end of the year [37] Question: Interest rate sensitivity changes - The company has moved closer to rate neutral due to recent restructuring, reducing liability sensitivity [45] Question: Drivers of in-market core deposit growth - Strong organic deposit growth and targeted efforts by newly hired retail sales officers contributed to deposit growth [48] Question: Details on credit quality and specific loans - Management provided updates on non-accruing loans and ongoing efforts to resolve issues with specific properties [66][70]

Financial Data and Key Metrics Changes - Consolidated net sales for Q1 2025 were $969.3 million, a decrease of 0.9% year-over-year, but increased modestly on a constant currency basis [35][46] - Gross margin was 30%, down 130 basis points from the prior year, primarily due to a higher mix of international projects in the agriculture segment [35] - Operating income was $128.3 million, representing 13.2% of sales, with diluted earnings per share at $4.32, consistent with the prior year [35][46] Business Line Data and Key Metrics Changes - Infrastructure sales decreased by 2.4%, with utility sales increasing by 2.4% driven by higher volumes and average selling prices [37] - Agriculture sales increased by 3.3%, approximately 6% on a constant currency basis, with international sales significantly up, particularly in the EMEA region and Brazil [40][41] Market Data and Key Metrics Changes - North American market conditions for agriculture remain challenged, with projected declines in corn and soybean prices [26] - The telecommunications business saw strong sales growth of nearly 30%, driven by favorable carrier spending [39] Company Strategy and Development Direction - The company is focused on capturing the global infrastructure wave by expanding capabilities and optimizing capacity, with a $30 million investment in CapEx for Q1 2025 [11][12] - A local-for-local supply chain strategy has been implemented to reduce exposure to tariffs and better serve global customers [9][48] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating disruptions while positioning the business for long-term growth, despite slight declines in consolidated net sales [6][7] - The outlook for 2025 remains optimistic, with net sales projected between $4.0 billion and $4.2 billion and diluted earnings per share expected between $17.20 and $18.80 [46][53] Other Important Information - The company is actively mitigating near-term tariffs, with a comprehensive plan to offset an estimated $80 million in tariff exposure [48][50] - A 13% dividend increase was announced during the quarter, and a stock repurchase program of $700 million was initiated [44] Q&A Session Summary Question: Have price actions been implemented to offset all of the tariff impacts to date? - Management indicated that about half of the $80 million tariff exposure is being addressed through pricing actions, with expectations for higher pricing and possibly lower volumes included in guidance [58][60] Question: What is the outlook for the telecom business for the rest of the year? - Management expressed strong confidence in continued growth in telecom, driven by carrier investments in 5G upgrades and modernization [63][64] Question: What is the expectation for volume growth in the utility and lighting & transportation segments? - Management expects mid-single-digit volume growth for infrastructure, excluding solar, with improvements noted in order rates for lighting [108][117] Question: How is the company managing its tariff situation and USMCA compliance? - Management confirmed that their Mexico operations are USMCA compliant and emphasized ongoing efforts to manage tariffs and costs effectively [121][122]