Financial Data and Key Metrics Changes - The company achieved a record AUM of $2.1 trillion, with net long-term inflows of nearly $29 billion, representing an 8% annualized organic growth, the best flow quarter since 2021 [13][24] - Total AUM increased by $123 billion, or 6%, from the previous quarter, and by $329 billion, or 18%, year-over-year [24] - Adjusted diluted earnings per share for the third quarter was $0.61, with a significant improvement in operating margin to 34.2% [25][36] Business Line Data and Key Metrics Changes - The ETF platform reached a milestone of $1 trillion in AUM, with an annualized organic growth of 15% [14] - Fundamental fixed income garnered over $4 billion in net long-term inflows, with total fixed income inflows reaching nearly $13 billion when including ETFs [16] - The company recorded net outflows of $5 billion in fundamental equities, primarily due to a broader secular outflow trend in actively managed equities [21] Market Data and Key Metrics Changes - Nearly 40% of long-term AUM is now from clients outside the U.S., with two-thirds of net inflows this quarter coming from EMEA and Asia-Pacific regions [13] - The China joint venture reached a record high AUM of $122 billion, reflecting a 16% increase over the last quarter, with $8.1 billion in net long-term inflows [17] - The company launched 12 new products in its China JV, including its first fixed income ETF, indicating strong demand for innovative products [19] Company Strategy and Development Direction - The company is focused on capital management and has repaid approximately 25% of the term loans used for a $1 billion preferred stock repurchase, enhancing earnings accretion [5][26] - A hybrid investment platform is being implemented, expected to be completed by the end of 2026, aimed at simplifying operations and improving investment performance [7][32] - The company is pursuing growth through partnerships, such as the Barings private markets partnership, which has already launched its first joint product [9][10] Management's Comments on Operating Environment and Future Outlook - Management noted strong momentum in the market, with key indices reaching new highs and increased investor confidence following a Fed rate cut [12] - The company is optimistic about future growth, particularly in fixed income and private markets, despite some volatility in the credit space [56][57] - Management emphasized the importance of investment performance, with over half of funds performing in the top quartile of peers on a three-year basis [23] Other Important Information - The company is in the process of selling a majority interest in its Indian business, expecting cash proceeds of $140 million to $150 million [35] - A non-cash impairment charge of $36 million was recorded related to the sale of intelliflo, which is expected to close in the fourth quarter [33][34] - The effective non-GAAP tax rate for the third quarter was significantly impacted by a favorable resolution of a tax matter, resulting in an effective rate of 11.2% [34] Q&A Session Summary Question: Update on QQQ shareholder vote and marketing expenses - Management is pleased with the progress of the QQQ shareholder vote, noting overwhelming support for the fee change, but cannot disclose specific quorum details [40][41] - The reclassification of marketing expenses does not impact operating income or the proposal's approval likelihood [42] Question: Use of proxy voting firm and expense classification - The proxy solicitation firm's expenses are considered marketing expenses of the fund and are not expected to affect Invesco's operating expenses [45][46] Question: Fixed income flows and market outlook - Management reported strong fixed income performance and organic growth, with no material implications from recent market events [55][56] Question: Details on divestitures and capital return priorities - Proceeds from the India sale are expected to enhance balance sheet flexibility, while the intelliflo sale is anticipated to have negligible impact on overall results [61][63] Question: Expense growth and Alpha platform integration - Implementation costs for the Alpha platform are expected to remain high through 2026, with a focus on managing fixed expenses [67][68] Question: Variable expenses and operating leverage - Variable expenses are expected to fluctuate with revenue, while fixed expenses will be closely managed to drive operating leverage [75][76]

Noble (NYSE:NE) Q3 2025 Earnings Call October 28, 2025 09:00 AM ET Company ParticipantsRichard Barker - CFOIan Macpherson - VP of Investor RelationsRobert Eifler - President and CEOConference Call ParticipantsDouglas Becker - AnalystNoel Parks - AnalystGregory Lewis - AnalystFredrik Stene - AnalystJosh Jayne - AnalystArun Jayaram - AnalystEddie Kim - AnalystOperatorThank you for standing by. My name is Carly, and I will be your conference operator today. At this time, I would like to welcome everyone to the ...

Financial Data and Key Metrics Changes - The company recorded a comprehensive loss of $80.2 million, or $0.77 per share, including a litigation settlement expense of $175.1 million, which equates to $1.68 per share [16][17] - The return on book value was -0.63% including the litigation expense, while it would have been +7.6% excluding the expense [16] - Total economic return for the third quarter was -6.3%, and +7.6% without the litigation expense [9] Business Line Data and Key Metrics Changes - The RMBS portfolio decreased from $11.4 billion to $10.9 billion due to agency securities sales [6] - The company funded $49 million of UPB in first and second liens during the third quarter, with an additional $52 million UPB in the origination pipeline at quarter-end [12] - The company brokered $60 million UPB in second liens, a significant increase from $44 million in Q2 [12] Market Data and Key Metrics Changes - The Fed cut rates by 25 basis points in September, marking the first cut since November 2024, which positively impacted equity markets, with the S&P 500 up almost 8% by quarter-end [10] - The nominal spread for current coupon RMBS tightened by 26 basis points to 145 basis points to the swap curve [22] Company Strategy and Development Direction - The company aims to enhance and grow its servicing and origination activities while focusing on a MSR-focused investment strategy [9] - The company plans to redeem $262 million of outstanding convertible notes to reduce structural leverage to historical levels [8] - The company is optimistic about the investment opportunities available in the market, particularly in the MSR and MBS portfolio [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's liquidity and risk metrics following the litigation settlement [5] - The company sees no reason for its stock to trade at an 11% discount to book value, given the quality of its assets and the uncertainty created by the litigation now resolved [13] - Management highlighted the importance of technology investments to maintain growth in the direct-to-consumer origination platform [69] Other Important Information - The company has established a significant relationship with a new sub-servicing client, bringing the total sub-servicing UPB to approximately $40 billion [11] - The company is focused on improving efficiencies and lowering costs in light of the recent settlement payments [9] Q&A Session Summary Question: What are the key drivers of the increase in the EAD in the third quarter relative to the second quarter? - The increase in EAD is attributed to the decrease in financing costs, allowing asset yields to remain constant [34] Question: Can you give us an update on your book value quarter to date? - The book value was up about 1% as of last Friday [37] Question: Can you talk about the various risk metrics as you think about the size of the portfolio? - The company considers multiple risk metrics, including returns available on asset classes and the ideal mix in the current market context [41][43] Question: Does the return potential slide factor in potential cost savings? - The return potential slide reflects current costs, and there is potential upside as cost savings are realized [44][46] Question: Can you help us understand the strategy behind the coupon positioning? - The coupon exposure is managed based on how rates move and the current coupon's position relative to risk exposures [51][52] Question: Can you give us color on growth opportunities in the sub-servicing business? - The company is focused on developing relationships and attracting clients dissatisfied with their current sub-servicers [60] Question: How do you see MSR valuations responding to a further drop in interest rates? - MSR valuations are expected to remain stable, with strong demand for low gross WAC MSR despite potential declines in prices [87][88] Question: What is the valuation of the flow MSRs that you're originating versus your existing portfolio? - The price multiple for the entire portfolio is 5.8x, with variations based on coupon rates [99]

Financial Data and Key Metrics Changes - The company reported net income of $106 million, or $1.54 per diluted share, with a return on assets at 1.56% and return on tangible common equity at 14.6% [9][10] - The efficiency ratio improved to 49.19% from 51.63% in the previous quarter, driven by a strong 17.8% annualized revenue growth [9][12] - Tangible book value per share grew to $42.90, reflecting a strong 15.2% annualized growth [9][10] Business Line Data and Key Metrics Changes - Loan portfolio production topped $2 billion, with a 4% annualized loan growth primarily from commercial and industrial (C&I) and commercial real estate (CRE) [6][7] - Non-interest income increased by $7.4 million, mainly from better equipment finance fees and a non-recurring gain on securities [11] - The company repurchased approximately $8.5 million of common stock, with a new share repurchase plan of $200 million approved [10] Market Data and Key Metrics Changes - Deposits increased by $295 million, with core deposits growing by $355 million, while brokered CDs represented only 5% of total deposits [13][14] - Non-interest-bearing deposits remained strong at 30.4% of total deposits [14] Company Strategy and Development Direction - The company remains focused on growing its core deposit base and tangible book value per share, with an emphasis on revenue growth and positive operating leverage [4][8] - The management is optimistic about capitalizing on growth opportunities in the Southeastern markets, particularly amid ongoing banking disruptions [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding loan demand and pipeline trends, anticipating potential growth acceleration into 2026 [19][49] - The company expects some margin compression in the coming quarters due to rising deposit costs, but remains focused on net interest income growth [11][41] Other Important Information - The company’s capital ratios improved, with common equity tier one at 13.2% and tangible common equity at 11.3% [5] - Asset quality remains stable, with low levels of net charge-offs and non-performing assets [12] Q&A Session Summary Question: Loan demand and pipeline trends - Management noted strong demand across all verticals and steady payoffs, expressing optimism for the fourth quarter and beyond [18][19] Question: Competition landscape - Competition is primarily on pricing, but management believes disruption in the market will provide additional volume opportunities [20][21] Question: Equipment finance demand and credit trends - Demand in equipment finance is picking up, with declining charge-offs indicating a healthy credit environment [24][25] Question: Expense growth outlook - Management anticipates a 5.5% increase in expenses next year, driven by salary and benefit increases [36][37] Question: Margin outlook and deposit costs - Management expects margin compression due to deposit repricing and competition, but remains focused on growing non-interest-bearing deposits [40][41] Question: Loan growth potential - Management is optimistic about the potential for loan growth to accelerate into the high single digits or even double digits, depending on macroeconomic conditions [49][50] Question: Investment portfolio size - The investment portfolio is expected to stabilize around 9% to 10% of total assets, with a focus on deposit growth [51] Question: M&A versus organic growth - Management prioritizes organic growth opportunities over M&A, given the current market disruption [53] Question: Mortgage activity and demand - Management is hopeful for increased mortgage activity as interest rates stabilize, with a significant increase in applications noted [60]

Financial Data and Key Metrics Changes - Total assets reached $16.4 billion, total deposits were $13.7 billion, and total loans amounted to $12.9 billion [7] - Revenue for the third quarter was a record $168 million, reflecting over 20% year-over-year growth [7][11] - Net interest margin improved by nine basis points quarter-over-quarter to 3.65% [7][10] - GAAP EPS for the nine months ended September 30, 2025, increased by $0.08 or 15%, while adjusted EPS rose by $0.16 or 21% [8] Business Line Data and Key Metrics Changes - Commercial and industrial loan growth exceeded 25% year-over-year [7] - Non-interest income increased by $1.3 million or 4% quarter-over-quarter, driven by service charges [11][19] - Adjusted pre-tax, pre-provision net revenue rose to almost $66 million, an 11.5% increase quarter-over-quarter [12] Market Data and Key Metrics Changes - The company has over 150 financial centers across Pennsylvania, New York, Ohio, and Indiana, with plans to open three new centers in the Columbus market [4][5] - The company was named a top 50 SBA lender nationally by volume [7] Company Strategy and Development Direction - The merger with Penns Woods Bancorp was completed, enhancing balance sheet scale and expected to achieve full cost savings by the second quarter of 2026 [3][25] - The company is focusing on organic growth and de novo branching in high-growth markets, particularly Columbus and Indianapolis [5][54] - Management emphasized maintaining tight cost controls and risk management discipline while pursuing sustainable growth [10][88] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining net interest margin levels in the mid-360s and expects to see continued growth in loan pipelines [24] - The company is managing credit risk tightly, with no direct exposure to companies with recent credit issues [8][22] - Future guidance for non-interest income is expected to be between $32 million to $33 million for the fourth quarter [24] Other Important Information - The company declared a quarterly dividend of $0.20 per share, representing an annualized yield of approximately 6.5% [9] - The liquidity position is strong, with available sources covering approximately 250% of uninsured deposits [14] Q&A Session Summary Question: Loan growth expectations and impact of new branches - Management indicated that while the acquisition had a significant impact on loan growth, they expect to hold the balance sheet stable and look for growth opportunities in the fourth quarter [30][31] Question: Expense management and future guidance - Management aims to manage positive operating leverage while investing for growth, with expectations of holding expenses at current levels [34][36] Question: Capital management and targets - The company is comfortable with its capital levels and will consider opportunities for buybacks or acquisitions as they arise [43] Question: Trends in the consumer portfolio and deposit accounts - Management noted elevated delinquencies due to administrative issues from the acquisition but remains comfortable with the overall consumer exposure [50][51] Question: Scaling the bank and future growth strategies - The focus is on maximizing integration and efficiency from the Penns Woods merger while considering both organic growth and M&A opportunities [52][54] Question: Funding loan growth and securities portfolio - Management expressed confidence in their ability to fund loan growth through deposits and securities, with a flexible approach to managing their funding mix [60][64]

Financial Data and Key Metrics Changes - Revenue grew by 7% in the quarter, driven by strong performance in Measurement and Control Solutions (MCS) and Water Solutions and Services (WSS) [9][10] - EBITDA margin expanded by 200 basis points year-over-year to over 23%, with EPS growth of 23% [5][10] - Year-to-date free cash flow is down modestly, primarily due to outsourced water projects and restructuring payments, but offset by higher net income and improved net working capital [10] Business Line Data and Key Metrics Changes - Measurement and Control Solutions saw an 11% organic growth in orders, with revenue also up 11%, driven by energy metering demand [10][11] - Water Infrastructure revenue grew by 5%, with a robust EBITDA margin expansion of 400 basis points to 24.4% [13] - Applied Water reported a 1% revenue increase, marking its seventh consecutive quarter of order growth, with an EBITDA margin expansion of 310 basis points to 21.7% [14] - Water Solutions and Services experienced a 10% revenue growth, despite an 11% decline in orders [15] Market Data and Key Metrics Changes - Orders were down 2% in the quarter, primarily due to softness in China, but growth was noted in the U.S. and Western Europe [9][10] - Backlog remains robust at approximately $5 billion, with a book-to-bill ratio near one [10] - The company anticipates continued momentum in North America, with expectations for double-digit growth in water meter projects [30] Company Strategy and Development Direction - The company is focusing on portfolio optimization and disciplined capital deployment, as evidenced by the divestiture of the international metering business [8][10] - The ongoing simplification efforts and 80/20 implementations are driving margin improvement and resource allocation towards high-value opportunities [7][8] - The company raised its full-year guidance for revenue, margin, and EPS, reflecting confidence in its ability to deliver commitments amid macro uncertainties [8][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term growth potential, particularly in digital water solutions and partnerships with major clients like Amazon [18][20] - The company is navigating macro uncertainties, including tariffs and foreign exchange movements, but remains confident in its operational execution and demand [17][20] - Management noted that while there are challenges in China, they are right-sizing the business to align with current market demand [79] Other Important Information - The updated annualized tariff impact is approximately $180 million, with expectations to offset this through pricing actions and supply chain adjustments [15] - The company is committed to maintaining a strong balance sheet, with a net debt to adjusted EBITDA ratio of 0.4x [10] Q&A Session Summary Question: What is the potential for EBITDA margin improvement in 2026 and beyond? - Management indicated that there is likely upside to long-term targets, with a focus on delivering 2025 commitments first [26][28] Question: How is the demand landscape shaping up for MCS? - Demand remains healthy, with a strong pipeline and expectations for high single-digit growth in 2026 [29][30] Question: What impact is the government shutdown having on projects? - Management noted no significant impact from the government shutdown, with previously allocated funds still expected to flow to projects [36] Question: What is the status of the 80/20 implementation? - Approximately 80% of the business is in some phase of 80/20 implementation, with ongoing efforts to simplify operations and improve margins [39][40] Question: How does the company plan to manage the challenges in China? - The company is restructuring its operations in China, reducing workforce size to align with market demand while maintaining a long-term positive outlook for the region [79][80]

Financial Data and Key Metrics Changes - Invesco reported a record AUM of $2.1 trillion, which is $123 billion or 6% higher than the previous quarter and $329 billion or 18% higher year-over-year [24] - Average long-term AUM increased by 9% sequentially and 16% year-over-year to $1.46 trillion [24] - Net revenues for the third quarter were $1.2 billion, an increase of $82 million compared to the same quarter last year, primarily driven by higher investment management fees [30] Business Line Data and Key Metrics Changes - The ETF platform reached a milestone of $1 trillion in AUM, with an annualized organic growth of 15% [14] - Fundamental fixed income garnered over $4 billion in net long-term inflows, with total fixed income inflows reaching nearly $13 billion when including ETFs [16] - The China joint venture achieved a record AUM of $122 billion, reflecting a 16% increase over the last quarter, with net long-term inflows of $8.1 billion [17] Market Data and Key Metrics Changes - Nearly 40% of long-term AUM is now from clients outside the U.S., with two-thirds of net inflows this quarter coming from AMEA and Asia-Pacific regions [13] - The U.S. wealth management SMA platform reached nearly $34 billion in AUM, with an annualized organic growth rate of 19% [17] - The company experienced strong demand for fixed income products, particularly in Asia, driving net inflows [16] Company Strategy and Development Direction - Invesco is focused on capital management and has repaid approximately 25% of the term loans used for a $1 billion preferred stock repurchase, enhancing earnings accretion [5] - The company is implementing a hybrid investment platform to streamline operations and improve investment performance, expected to be completed by the end of 2026 [7][32] - A significant growth initiative is underway to modernize the QQQ ETF structure, with strong shareholder participation in the proposals [11] Management's Comments on Operating Environment and Future Outlook - Management noted strong momentum in the market, with key indices reaching new highs and increased investor confidence following a Fed rate cut [12] - The company is optimistic about future growth opportunities, particularly in private markets and the evolving demand for income-oriented solutions [9] - Management expressed confidence in the ongoing improvements in investment performance, which is crucial for maintaining market share [22] Other Important Information - The sale of IntelliFlow is expected to generate approximately $100 million in net cash, with potential future earnouts of up to $65 million [8] - The company anticipates closing the transaction for a majority interest in its Indian business, expecting cash proceeds of $140 million to $150 million [35] - The effective non-GAAP tax rate for the third quarter was significantly impacted by a favorable resolution of a tax matter, resulting in an 11.2% rate [34] Q&A Session Summary Question: Update on QQQ shareholder vote and marketing expenses - Management is pleased with the progress of the QQQ shareholder vote, noting overwhelming support for the fee change, and clarified that reclassifying marketing expenses does not impact operating income [41][42] Question: Use of proxy voting firm and expense classification - The proxy solicitation firm is considered a marketing expense of the fund, and management does not foresee it affecting Invesco's operating expenses [45][46] Question: Fixed income flows and market outlook - Management reported continued strength in fixed income flows, with over $30 billion in platform-wide fixed income flows, and noted some softening in bank loan flows [55][56] Question: Details on divestitures and capital return priorities - Proceeds from the sale of the Indian business and IntelliFlow will enhance balance sheet flexibility, with a focus on returning 60% of capital to shareholders [62][63] Question: Expense growth and Alpha platform integration - Management expects implementation costs for the Alpha platform to remain high through 2026, with a focus on managing fixed expenses effectively [68][70]

Financial Data and Key Metrics Changes - NextEra Energy reported a 9.7% year-over-year increase in adjusted earnings per share for Q3 2025, with a 9.3% increase for the first nine months of the year [5][20] - Florida Power & Light's (FPL) earnings per share increased by $0.08 year-over-year, driven by an 8% year-over-year growth in regulatory capital [20] - FPL's capital expenditures for the quarter were approximately $2.5 billion, with full-year expectations between $9.3 billion and $9.8 billion [20] Business Line Data and Key Metrics Changes - Energy Resources reported a 13% year-over-year growth in adjusted earnings, with adjusted earnings per share increasing by $0.06 [21] - Contributions from new investments at Energy Resources increased by $0.09 per share, primarily from growth in the renewables portfolio [21] - FPL's retail sales decreased by 1.8% year-over-year due to milder weather, but increased by 1.9% on a weather-normalized basis [20][21] Market Data and Key Metrics Changes - Florida Power & Light customers experience reliability that is nearly 60% better than the national average, with typical residential bills 20% lower than 20 years ago when adjusted for inflation [8] - The Florida economy continues to grow significantly, prompting FPL to plan approximately $40 billion in investments over the next four years [10] Company Strategy and Development Direction - NextEra Energy aims to lead in the growing demand for electricity by developing and operating various forms of energy infrastructure [5][6] - FPL plans to invest in new energy infrastructure, including 5.3 GW in solar and 3.4 GW in battery storage over the next four years [10] - The company is focusing on a multi-decade approach to add low-cost generation while maintaining reliability and low customer bills [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver near-term and long-term value, citing extensive growth opportunities both inside and outside Florida [7][19] - The management team highlighted the importance of a strong balance sheet and development capabilities in meeting the growing energy demand across America [14][19] - The company expects to continue delivering financial results at or near the top end of adjusted earnings per share expectations for 2025, 2026, and 2027 [23] Other Important Information - NextEra Energy has entered into a 25-year power purchase agreement with Google to recommission the Duane Arnold Energy Center nuclear plant, expected to contribute up to $0.16 of annual adjusted EPS over its first 10 years of operation [15][18] - The company has a strong backlog of nearly 30 GW, with 2.8 GW of new battery storage opportunities originated over the second and third quarters [22] Q&A Session Summary Question: Can you provide any sense on the cost of restart for Duane Arnold and the buy-in price of the 30%? - Management did not disclose specific CapEx numbers but expressed confidence in the efficient recommissioning of Duane Arnold, which is in good shape [25][26] Question: What drove the removal of 1 GW from the backlog? - The removal was due to conservative management of smaller projects and permitting delays, with expectations to recover the capacity in 2026 and 2027 [29][30] Question: What is the outlook for gas-fired generation? - NextEra Energy has a developed pipeline of approximately 20 GW for gas-fired generation and sees significant opportunities in this area [39][40] Question: How are renewables interacting with data centers? - Data centers are looking for immediate load interconnects, and NextEra Energy can provide solutions through a combination of renewables, storage, and grid upgrades [80] Question: What is the expected impact of tax credits on demand? - Demand is expected to escalate as the company approaches 2030, with significant opportunities anticipated in 2028 and beyond [66][67]

Financial Performance - Novartis reported a 7% increase in net sales and core operating income for Q3 2025, with a core margin of 39.3% [5][27] - Core EPS rose by 10% to $2.25, and free cash flow totaled $6.2 billion for the quarter [28][27] - For the first nine months, net sales grew by 11%, core operating income by 18%, and core EPS increased by 21% to $6.94 [28][29] Business Line Performance - Key brands showed strong growth: Kisqali grew 68%, Pluvicto 45%, Leqvio 54%, and Scemblix 95% in constant currency [6][10][14][16] - Kisqali's U.S. growth was particularly strong at 91%, with a market-leading position in both metastatic and early breast cancer [7][9] - Pluvicto's growth was driven by new patient starts, with U.S. sales up 53% [11][12] - Leqvio is on track for over $1 billion in sales, with significant growth in both the U.S. and international markets [14][15] - Scemblix is expected to become the most prescribed TKI in the U.S. [16] Market Performance - The U.S. experienced negative growth due to net true-ups related to Medicare Part D redesign, but underlying growth would have been 9% without these adjustments [27][28] - Outside the U.S., Kisqali saw 37% growth in constant currency, and Pluvicto is expanding in Europe, Canada, and Brazil [7][12] - The renal portfolio, particularly IGAN, grew 98% in the U.S., significantly outpacing market growth [20][21] Company Strategy and Industry Competition - Novartis is focused on driving growth through its priority brands and pipeline advancements, despite facing generic erosion from products like Entresto [5][28] - The company is pursuing strategic acquisitions, including Avidity Biosciences, to enhance its growth trajectory [35][36] - Novartis aims to maintain a core margin of around 40% despite expected short-term dilution from new product launches [35][36] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in mid to long-term growth, reaffirming guidance for high single-digit growth in net sales and low teens growth in core operating income for the full year [31][38] - The company anticipates challenges in the first half of 2026 due to generic competition but expects a stronger second half [33][34] - Management highlighted the importance of addressing pricing and reimbursement issues with the administration to support innovation [41][42] Other Important Information - Novartis is preparing for regulatory submissions for several products, including remibrutinib and ianalumab, with expectations for rapid uptake in the market [22][24] - The company is focused on enhancing its R&D capabilities and expanding its manufacturing base in the U.S. [43] Q&A Session Summary Question: Impact of Medicaid and tariffs on the industry - Management indicated that while some companies have reached agreements with the administration, Novartis is in ongoing discussions to find suitable solutions [41][42] Question: CapEx and cash flow modeling - Management clarified that the majority of the $23 billion commitment over five years is for R&D OpEx, with CapEx expected to remain stable at 2.5%-3% of sales [42][43] Question: Market reaction to ATR abstract - Management expressed confidence that detailed data presentation would improve market perception and emphasized the importance of patient benefits over statistical measures [46][47] Question: Pluvicto launch curve and peak sales ambition - Management stated that Pluvicto is on a strong growth trajectory, expecting to reach peak sales of $5 billion with ongoing efforts to tackle commercialization challenges [55][56][58] Question: Remibrutinib ramp-up and European adoption - Management highlighted the focus on payer negotiations and the potential for rapid uptake in the U.S. and Europe, emphasizing the innovative profile of remibrutinib [62][64] Question: Ianalumab study results and secondary endpoints - Management explained the statistical significance achieved in primary endpoints and the importance of patient-relevant outcomes for future discussions with physicians [68][71] Question: Cosentyx market share and new formulation - Management noted that there has been no significant impact from competitor launches and emphasized ongoing efforts to maintain market share in a growing market [74]

Financial Data and Key Metrics Changes - Total assets reached $16.4 billion, total deposits were $13.7 billion, and total loans amounted to $12.9 billion, reflecting significant growth [7][11] - Revenue for the third quarter was a record $168 million, representing over 20% year-over-year growth [7][11] - Net interest margin improved by nine basis points quarter-over-quarter to 3.65% [7][11] - GAAP EPS increased by $0.08 or 15% for the nine months ended September 30, 2025, while adjusted EPS rose by $0.16 or 21% for the same period [8][11] Business Line Data and Key Metrics Changes - Commercial and industrial loan growth exceeded 25% year-over-year, with strong progress in specialty verticals and SBA lending [7][11] - Non-interest income increased by $1.3 million or 4% quarter-over-quarter, driven primarily by service charges [11][19] - Adjusted pre-tax, pre-provision net revenue was nearly $66 million, an 11.5% increase quarter-over-quarter [12] Market Data and Key Metrics Changes - The company has over 150 financial centers across Pennsylvania, New York, Ohio, and Indiana, with plans to open additional centers in high-growth markets [4][5] - The company was named a top 50 SBA lender nationally by volume, indicating strong market positioning [7] Company Strategy and Development Direction - The merger with Penns Woods Bancorp was completed, enhancing the company's scale and operational efficiency [3][13] - The company is focused on sustainable, responsible, and profitable growth, with plans to open new financial centers in key locations [4][5][10] - The management team is actively recruiting for leadership roles to support expansion and enhance service offerings [4][5] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining net interest margin levels in the mid-360s and anticipates continued growth in loan portfolios [24] - The company is managing credit risk tightly, with no direct exposure to companies facing significant credit issues [8][22] - Future guidance for non-interest income and expenses was provided, indicating stable expectations for the upcoming quarters [24][25] Other Important Information - The company declared a quarterly dividend of $0.20 per share, representing an annualized yield of approximately 6.5% [9] - The integration of the Penns Woods acquisition is progressing well, with expected cost savings to be fully realized by the second quarter of 2026 [25][86] Q&A Session Summary Question: Loan growth expectations and impact of new branches - Management indicated that loan growth is expected to stabilize, with opportunities for growth in the fourth quarter and beyond, particularly from new branches [30][31][32] Question: Expense management and future guidance - Management emphasized a focus on positive operating leverage while continuing to invest for growth, with expectations for expenses to remain stable [34][35][36] Question: Capital management post-acquisition - Management expressed comfort with current capital levels, indicating a preference for maintaining a strong capital base while exploring growth opportunities [43][44] Question: Consumer portfolio trends and deposit activity - Management noted elevated delinquencies due to administrative issues from the acquisition but remains confident in the overall health of the consumer portfolio [50][51] Question: Scaling the bank and future growth strategies - Management is focused on maximizing integration and efficiency from the Penns Woods merger while considering both organic growth and M&A opportunities for future scaling [52][54] Question: Funding loan growth and deposit strategies - Management indicated strong funding capacity for loan growth, with expectations for deposit growth from new branches and existing customer relationships [61][62] Question: Overall loan yields and competitive landscape - Management reported that overall loan yields are in the low sevens, with expectations for some pressure on yields due to competitive market conditions [78][79]