NewzIntel.com

Category: Taxation

  • MIL-OSI Security: Florida Businessman Indicted for Tax Evasion

    Source: United States Attorneys General 10

    A federal grand jury in Jacksonville, Florida, returned an indictment yesterday charging a Florida businessman with tax evasion, not filing a tax return and not paying taxes.

    According to the indictment, Phillip Mak, of Jacksonville, was a self-employed businessman who from 2008 through 2020 earned approximately $10.3 million in income. During that same period, Mak allegedly did not pay any federal taxes and, except for two years, did not file tax returns. The IRS allegedly assessed approximately $1.9 million in outstanding taxes, penalties and interest against Mak for tax years 2008, 2009, 2012-2015 and 2019-2020.

    Instead of paying what he owed, Mak allegedly attempted to shield his assets from the IRS by transferring $1 million in cash to his domestic partner’s bank accounts. In addition, the indictment alleges that Mak, after being interviewed by IRS investigators, transferred ownership of his home to his domestic partner’s trust, created a nominee entity and began depositing his income into a bank account held in the name of that entity.

    In total, Mak is alleged to have caused a tax loss to the IRS of more than $1.92 million.

    If convicted, Mak faces a maximum sentence of five years in prison for tax evasion and a maximum sentence of one year in prison for each charge of failure to file a tax return and failure to pay tax. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.

    Acting Deputy Assistant Attorney General Karen E. Kelly of the Justice Department’s Tax Division and U.S. Attorney Roger B. Handberg for the Middle District of Florida made the announcement.

    IRS Criminal Investigation is investigating the case.

    Trial Attorneys Isaiah Boyd and Michael Jones of the Tax Division and Assistant U.S. Attorney John Cannizzaro for the Middle District of Florida are prosecuting the case.

    An indictment is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

    MIL Security OSI –

  • MIL-OSI: Baker Hughes Secures Significant Gas Technology Order for Third Expansion Phase of Aramco’s Jafurah Gas Field

    Source: GlobeNewswire (MIL-OSI)

    • Contract awarded by Tecnicas Reunidas for six gas compression trains and six propane compressors, including balance of plants and auxiliaries
    • State-of-the-art technologies to support third expansion phase of the largest unconventional gas field in Saudi Arabia

    HOUSTON and LONDON, Jan. 30, 2025 (GLOBE NEWSWIRE) — Baker Hughes (NASDAQ: BKR), an energy technology company, announced Thursday it has been awarded an order by Tecnicas Reunidas for six gas compression trains and six propane compressors, for the third expansion phase of Aramco’s Jafurah gas field, located in the Kingdom of Saudi Arabia. The order was booked in the fourth quarter of 2024.

    Building on its broad experience in providing technology solutions for the entire natural gas value chain, Baker Hughes will supply state-of-the-art electric motor driven compression solutions, leveraging its recently expanded Damman Center in Dammam, Saudi Arabia. This order adds to Baker Hughes’ long-standing partnership with Aramco, which includes the supply of compression solutions for the Haradh and Hawiyah gas plants, first phase of the Jafurah gas plant and gas compression facilities, and more recently, equipment for the third phase of Saudi Arabia’s Master Gas System project.

    “Gas continues to serve as a vital source of reliable, abundant and lower-carbon energy,” said Ganesh Ramaswamy, executive vice president of Industrial & Energy Technology at Baker Hughes. “Our advanced gas compression technology will enable efficient and reliable production from the Jafurah field, further supporting Aramco’s vision and contributing to Saudi Arabia’s energy development.”

    About Baker Hughes
    Baker Hughes (NASDAQ: BKR) is an energy technology company that provides solutions to energy and industrial customers worldwide. Built on a century of experience and conducting business in over 120 countries, our innovative technologies and services are taking energy forward – making it safer, cleaner and more efficient for people and the planet. Visit us at bakerhughes.com.

    For more information, please contact:

    Media Relations
    Chiara Toniato
    +39 3463823419
    chiara.toniato@bakerhughes.com

    Baker Hughes Investor Relations
    Chase Mulvehill
    +1 346-297-2564
    investor.relations@bakerhughes.com

    The MIL Network –

  • MIL-OSI USA: Cortez Masto, Cornyn Introduce Bipartisan Legislation to Eliminate Tax Breaks for Businesses Dealing in Russia

    US Senate News:

    Source: United States Senator for Nevada Cortez Masto

    Washington, D.C. – Today, U.S. Senators Catherine Cortez Masto (D-Nev.) and John Cornyn (R-Tex.) introduced bipartisan legislation to prevent businesses from claiming a foreign tax credit or deduction against taxes paid to fund the Russian government’s war machine. Currently, businesses paying taxes in foreign countries are eligible to claim a tax credit or deduction in the United States to reduce the burden of double taxation. There are certain hostile countries to which this tax credit does not apply, including North Korea and Iran, and Cortez Masto’s HONOR Act would add Russia to that list.

    In September 2023, Russia President Vladimir Putin illegally suspended the U.S-Russia Tax Treaty. Following a letter from Senators Cortez Masto and Cornyn, the United States Department of the Treasury retaliated by suspending benefits for Russian businesses and investors. The HONOR Act would take this suspension one step further and prevent businesses funding Putin’s illegal war in Ukraine from receiving tax breaks in the United States. This bill would ensure U.S. taxpayers are not subsidizing Putin’s oppressive government.

    “We should not be giving tax breaks to businesses that are funding the Putin regime. It’s that simple,” said Senator Cortez Masto. “This bipartisan legislation expands upon current Treasury Department policy, holds Russia accountable for its criminal activity in Ukraine, and protects American national security.”

    “Businesses that continue to engage with Russia are enriching Putin’s oppressive regime,” said Senator Cornyn. “This commonsense bill would force these businesses to give up their foreign tax credits and deductions for taxes paid to Russia, which subsidize the Russian war apparatus.”

    Senator Cortez Masto has consistently advocated for the U.S. to stand up to Russian aggression and support Ukrainian sovereignty. She has voted to pass bipartisan legislation to support Ukraine and helped pass bipartisan economic sanctions that were signed into law to hold Russia accountable for its illegal invasion of Ukraine. She voted in support of sanctions against Russia and its Nord Stream 2 pipeline, and she supported similar sanctions in the 2020 and 2021 National Defense Authorization Acts.  

    MIL OSI USA News –

  • MIL-OSI USA: Cracked and Nulled Marketplaces Disrupted in International Cyber Operation

    Source: US State of California

    At Least 17M U.S. Victims Affected

    The Justice Department today announced its participation in a multinational operation involving actions in the United States, Romania, Australia, France, Germany, Spain, Italy, and Greece to disrupt and take down the infrastructure of the online cybercrime marketplaces known as Cracked and Nulled. The operation was announced in conjunction with Operation Talent, a multinational law enforcement operation supported by Europol to investigate Cracked and Nulled.

    Operation Talent Seizure Banner

    Supervisory Official Antoinette T. Bacon of the Justice Department’s Criminal Division, U.S. Attorney Trini E. Ross for the Western District of New York, U.S. Attorney Jaime Esparza for the Western District of Texas, Assistant Director Brian A. Vorndran of the FBI’s Cyber Division, Special Agent in Charge Matthew Miraglia of the FBI Buffalo Field Office, and Special Agent in Charge Aaron Tapp for the FBI San Antonio Field Office made the announcement.

    Cracked

    According to seizure warrants unsealed today, the Cracked marketplace has been selling stolen login credentials, hacking tools, and servers for hosting malware and stolen data — as well as other tools for carrying out cybercrime and fraud — since March 2018. Cracked had over four million users, listed over 28 million posts advertising cybercrime tools and stolen information, generated approximately $4 million in revenue, and impacted at least 17 million victims from the United States. One product advertised on Cracked offered access to “billions of leaked websites” allowing users to search for stolen login credentials. This product was recently allegedly used to sextort and harass a woman in the Western District of New York. Specifically, a cybercriminal entered the victim’s username into the tool and obtained the victim’s credentials for an online account. Using the victim’s credentials, the subject then cyberstalked the victim and sent sexually demeaning and threatening messages to the victim. The seizure of these marketplaces is intended to disrupt this type of cybercrime and the proliferation of these tools in the cybercrime community.

    The FBI, working in coordination with foreign law enforcement partners, identified a series of servers that hosted the Cracked marketplace infrastructure and eight domain names used to operate Cracked. They also identified servers and domain names for Cracked’s payment processor, Sellix, and the server and domain name for a related bulletproof hosting service. All of these servers and domain names have been seized pursuant to domestic and international legal process. Anyone visiting any of these seized domains will now see a seizure banner that notifies them that the domain has been seized by law enforcement authorities.

    The FBI Buffalo Field Office is investigating the case.

    Senior Counsel Thomas Dougherty of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Charles Kruly for the Western District of New York are prosecuting the case.

    Nulled

    The Justice Department announced the seizure of the Nulled website domain and unsealed charges against one of Nulled’s administrators, Lucas Sohn, 29, an Argentinian national residing in Spain. According to the unsealed complaint affidavit, the Nulled marketplace has been selling stolen login credentials, stolen identification documents, hacking tools, as well as other tools for carrying out cybercrime and fraud, since 2016. Nulled had over five million users, listed over 43 million posts advertising cybercrime tools and stolen information, and generated approximately $1 million in yearly revenue. One product advertised on Nulled purported to contain the names and social security numbers of 500,000 American citizens.

    The FBI, working in coordination with foreign law enforcement partners, identified the servers that hosted the Nulled marketplace infrastructure, and the domain used to operate Nulled. The servers and domain have been seized pursuant to domestic and international legal process. Anyone visiting the Nulled domain will now see a seizure banner that notifies them that the domain has been seized by law enforcement authorities.

    According to the complaint, Sohn was an active administrator of Nulled and performed escrow functions on the website. Nulled’s customers would use Sohn’s services to complete transactions involving stolen credentials and other information. For his actions, Sohn has been charged with conspiracy to traffic in passwords and similar information through which computers may be accessed without authorization; conspiracy to solicit another person for the purpose of offering an access device or selling information regarding an access device; and conspiracy to possess, transfer, or use a means of identification of another person with the intent to commit or to aid and abet or in connection with any unlawful activity that is a violation of federal law.

    If convicted, Sohn faces a maximum penalty of five years in prison for conspiracy to traffic in passwords, 10 years in prison for access device fraud, and 15 years in prison for identity fraud.

    The FBI Austin Cyber Task Force is investigating the case. The Task Force participants include the Naval Criminal Investigative Service, IRS Criminal Investigation, Defense Criminal Investigative Service, and the Department of the Army Criminal Investigation Division, among other agencies.

    Assistant U.S. Attorneys G. Karthik Srinivasan and Christopher Mangels for the Western District of Texas are prosecuting the case, with Assistant U.S. Attorney Mark Tindall for the Western District of Texas handling the forfeiture component.

    The Justice Department worked in close cooperation with investigators and prosecutors from several jurisdictions on the takedown of both the Cracked and Nulled marketplaces, including the Australian Federal Police, Europol, France’s Anti-Cybercrime Office (Office Anti-cybercriminalité) and Cyber Division of the Paris Prosecution Office, Germany’s Federal Criminal Police Office (Bundeskriminalamt) and Prosecutor General’s Office Frankfurt am Main – Cyber Crime Center (Generalstaatsanwaltschaft Frankfurt am Main – ZIT), the Spanish National Police (Policía Nacional) and Guardia Civil, the Hellenic Police (Ελληνική Αστυνομία), Italy’s Polizia di Stato and the General Inspectorate of Romanian Police (Inspectoratul General al Poliției Romane). The Justice Department’s Office of International Affairs provided significant assistance.

    A complaint is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

    MIL OSI USA News –

  • MIL-OSI Security: Cracked and Nulled Marketplaces Disrupted in International Cyber Operation

    Source: United States Attorneys General 2

    At Least 17M U.S. Victims Affected

    The Justice Department today announced its participation in a multinational operation involving actions in the United States, Romania, Australia, France, Germany, Spain, Italy, and Greece to disrupt and take down the infrastructure of the online cybercrime marketplaces known as Cracked and Nulled. The operation was announced in conjunction with Operation Talent, a multinational law enforcement operation supported by Europol to investigate Cracked and Nulled.

    Operation Talent Seizure Banner

    Supervisory Official Antoinette T. Bacon of the Justice Department’s Criminal Division, U.S. Attorney Trini E. Ross for the Western District of New York, U.S. Attorney Jaime Esparza for the Western District of Texas, Assistant Director Brian A. Vorndran of the FBI’s Cyber Division, Special Agent in Charge Matthew Miraglia of the FBI Buffalo Field Office, and Special Agent in Charge Aaron Tapp for the FBI San Antonio Field Office made the announcement.

    Cracked

    According to seizure warrants unsealed today, the Cracked marketplace has been selling stolen login credentials, hacking tools, and servers for hosting malware and stolen data — as well as other tools for carrying out cybercrime and fraud — since March 2018. Cracked had over four million users, listed over 28 million posts advertising cybercrime tools and stolen information, generated approximately $4 million in revenue, and impacted at least 17 million victims from the United States. One product advertised on Cracked offered access to “billions of leaked websites” allowing users to search for stolen login credentials. This product was recently allegedly used to sextort and harass a woman in the Western District of New York. Specifically, a cybercriminal entered the victim’s username into the tool and obtained the victim’s credentials for an online account. Using the victim’s credentials, the subject then cyberstalked the victim and sent sexually demeaning and threatening messages to the victim. The seizure of these marketplaces is intended to disrupt this type of cybercrime and the proliferation of these tools in the cybercrime community.

    The FBI, working in coordination with foreign law enforcement partners, identified a series of servers that hosted the Cracked marketplace infrastructure and eight domain names used to operate Cracked. They also identified servers and domain names for Cracked’s payment processor, Sellix, and the server and domain name for a related bulletproof hosting service. All of these servers and domain names have been seized pursuant to domestic and international legal process. Anyone visiting any of these seized domains will now see a seizure banner that notifies them that the domain has been seized by law enforcement authorities.

    The FBI Buffalo Field Office is investigating the case.

    Senior Counsel Thomas Dougherty of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS) and Assistant U.S. Attorney Charles Kruly for the Western District of New York are prosecuting the case.

    Nulled

    The Justice Department announced the seizure of the Nulled website domain and unsealed charges against one of Nulled’s administrators, Lucas Sohn, 29, an Argentinian national residing in Spain. According to the unsealed complaint affidavit, the Nulled marketplace has been selling stolen login credentials, stolen identification documents, hacking tools, as well as other tools for carrying out cybercrime and fraud, since 2016. Nulled had over five million users, listed over 43 million posts advertising cybercrime tools and stolen information, and generated approximately $1 million in yearly revenue. One product advertised on Nulled purported to contain the names and social security numbers of 500,000 American citizens.

    The FBI, working in coordination with foreign law enforcement partners, identified the servers that hosted the Nulled marketplace infrastructure, and the domain used to operate Nulled. The servers and domain have been seized pursuant to domestic and international legal process. Anyone visiting the Nulled domain will now see a seizure banner that notifies them that the domain has been seized by law enforcement authorities.

    According to the complaint, Sohn was an active administrator of Nulled and performed escrow functions on the website. Nulled’s customers would use Sohn’s services to complete transactions involving stolen credentials and other information. For his actions, Sohn has been charged with conspiracy to traffic in passwords and similar information through which computers may be accessed without authorization; conspiracy to solicit another person for the purpose of offering an access device or selling information regarding an access device; and conspiracy to possess, transfer, or use a means of identification of another person with the intent to commit or to aid and abet or in connection with any unlawful activity that is a violation of federal law.

    If convicted, Sohn faces a maximum penalty of five years in prison for conspiracy to traffic in passwords, 10 years in prison for access device fraud, and 15 years in prison for identity fraud.

    The FBI Austin Cyber Task Force is investigating the case. The Task Force participants include the Naval Criminal Investigative Service, IRS Criminal Investigation, Defense Criminal Investigative Service, and the Department of the Army Criminal Investigation Division, among other agencies.

    Assistant U.S. Attorneys G. Karthik Srinivasan and Christopher Mangels for the Western District of Texas are prosecuting the case, with Assistant U.S. Attorney Mark Tindall for the Western District of Texas handling the forfeiture component.

    The Justice Department worked in close cooperation with investigators and prosecutors from several jurisdictions on the takedown of both the Cracked and Nulled marketplaces, including the Australian Federal Police, Europol, France’s Anti-Cybercrime Office (Office Anti-cybercriminalité) and Cyber Division of the Paris Prosecution Office, Germany’s Federal Criminal Police Office (Bundeskriminalamt) and Prosecutor General’s Office Frankfurt am Main – Cyber Crime Center (Generalstaatsanwaltschaft Frankfurt am Main – ZIT), the Spanish National Police (Policía Nacional) and Guardia Civil, the Hellenic Police (Ελληνική Αστυνομία), Italy’s Polizia di Stato and the General Inspectorate of Romanian Police (Inspectoratul General al Poliției Romane). The Justice Department’s Office of International Affairs provided significant assistance.

    A complaint is merely an allegation. All defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

    MIL Security OSI –

  • MIL-OSI Security: Federal Courts Authorize IRS “John Doe” Summonses to Trident Trust Entities

    Source: United States Attorneys General 2

    Summonses Are for Records Relating to U.S. Taxpayers Who May Have Used Network of Offshore Service Providers to Hide Assets and Evade Taxes

    The U.S. District Court for the Northern District of Georgia entered an order earlier this week authorizing the IRS to serve John Doe summonses on TT (USA) Holdings Inc.; Trident Corporate Services Inc. and Trident Fund Services Inc., entities that are members of a multinational group of affiliated companies generally operating under the trade name “Trident Trust” and collectively referred to as the “Trident Trust Group.”

    Separately, on Dec. 18, 2024, the U.S. District Court for the District of South Dakota entered an order, unsealed on Jan. 21, authorizing service of a similar John Doe summons on Trident Trust Company (South Dakota) Inc. The United States also previously obtained approval in the U.S. District Court for the Southern District of New York for the IRS to serve John Doe summonses on a different affiliate entity of the Trident Trust Group, as well as to third party financial service companies, banks and courier services that may have information about Trident Trust Group’s U.S. taxpayer clients.

    The United States is not alleging that any of the entities engaged in wrongdoing. Rather, the IRS uses John Doe summonses to obtain information about possible violations of internal revenue laws by individuals whose identities are unknown. These summonses seek information about U.S. individuals who may have used the Trident Trust Group’s services to underreport their worldwide income and conceal their ownership of certain foreign assets that U.S. individuals are required to report to the U.S. government.

    “The Justice Department and the IRS are dedicated to unearthing tax evasion that uses foreign bank accounts and offshore shell corporations,” said Deputy Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division. “We will use the many tools available to us, including John Doe summonses like the ones authorized by the courts here, to ensure that taxpayers are fully meeting their responsibilities.”

    Federal law requires certain individual taxpayers, including all U.S. citizens and residents with gross annual income above the reporting threshold, to pay taxes on all income earned worldwide. They must also disclose certain foreign financial accounts, assets and controlled foreign corporations. Failure to report these offshore arrangements can result in serious civil and criminal consequences.

    The government’s petitions allege that Trident Trust Group is an offshore service provider operating in nearly 30 countries worldwide, and it has provided corporate, trust and fund administration services for over 40 years. The petitions further allege that Trident Trust Group offers services that enable offshore account and entity concealment, like mail forwarding and retention, and ready-to-use “shelf” companies. For example, the petitions allege that Trident Trust Group personnel have listed themselves as the founders, directors and officers of thousands of Panamanian companies to help their U.S. clients potentially conceal their interests in and income from those foreign entities.

    A declaration from an IRS revenue agent that accompanied the petitions alleges that at least nine U.S. taxpayers used Trident Trust Group’s services to avoid compliance with U.S. tax laws. The declaration further alleges that the IRS learned of this noncompliance through the Offshore Voluntary Disclosure Program, a program that allowed U.S. taxpayers to voluntarily disclose foreign accounts or entities used to evade tax in exchange for settling their civil liabilities on fixed terms.

    These orders authorize the IRS to issue summonses to TT (USA) Holdings Inc.; Trident Corporate Services Inc.; Trident Fund Services Inc. and Trident Trust Company (South Dakota) Inc seeking information about U.S. taxpayer clients who may have used the services of the entities and the broader Trident Trust Group to establish, maintain, operate or control any foreign financial account or other foreign asset; any foreign corporation, company, trust, foundation or other legal entity or any foreign or domestic financial account or other asset in the name of such foreign entity from 2014 through 2023. By obtaining these records, the IRS expects to be able to identify clients of the Trident Trust Group to investigate whether they potentially used the group’s services to avoid or evade federal taxes.

    Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

    Tax Division Attorneys Christina T. Lanier and Brij B. Patnaik are handling the case in the U.S. District Court for the District of South Dakota; and they, along with Elisabeth K. Kryska of the Tax Division, are handling the case in the Northern District of Georgia. Assistant U.S. Attorney Anthony J. Sun for the Southern District of New York is handling the case in the U.S. District Court for the Southern District of New York.

    MIL Security OSI –

  • MIL-OSI USA: Federal Courts Authorize IRS “John Doe” Summonses to Trident Trust Entities

    Source: US State of North Dakota

    Summonses Are for Records Relating to U.S. Taxpayers Who May Have Used Network of Offshore Service Providers to Hide Assets and Evade Taxes

    The U.S. District Court for the Northern District of Georgia entered an order earlier this week authorizing the IRS to serve John Doe summonses on TT (USA) Holdings Inc.; Trident Corporate Services Inc. and Trident Fund Services Inc., entities that are members of a multinational group of affiliated companies generally operating under the trade name “Trident Trust” and collectively referred to as the “Trident Trust Group.”

    Separately, on Dec. 18, 2024, the U.S. District Court for the District of South Dakota entered an order, unsealed on Jan. 21, authorizing service of a similar John Doe summons on Trident Trust Company (South Dakota) Inc. The United States also previously obtained approval in the U.S. District Court for the Southern District of New York for the IRS to serve John Doe summonses on a different affiliate entity of the Trident Trust Group, as well as to third party financial service companies, banks and courier services that may have information about Trident Trust Group’s U.S. taxpayer clients.

    The United States is not alleging that any of the entities engaged in wrongdoing. Rather, the IRS uses John Doe summonses to obtain information about possible violations of internal revenue laws by individuals whose identities are unknown. These summonses seek information about U.S. individuals who may have used the Trident Trust Group’s services to underreport their worldwide income and conceal their ownership of certain foreign assets that U.S. individuals are required to report to the U.S. government.

    “The Justice Department and the IRS are dedicated to unearthing tax evasion that uses foreign bank accounts and offshore shell corporations,” said Deputy Assistant Attorney General David A. Hubbert of the Justice Department’s Tax Division. “We will use the many tools available to us, including John Doe summonses like the ones authorized by the courts here, to ensure that taxpayers are fully meeting their responsibilities.”

    Federal law requires certain individual taxpayers, including all U.S. citizens and residents with gross annual income above the reporting threshold, to pay taxes on all income earned worldwide. They must also disclose certain foreign financial accounts, assets and controlled foreign corporations. Failure to report these offshore arrangements can result in serious civil and criminal consequences.

    The government’s petitions allege that Trident Trust Group is an offshore service provider operating in nearly 30 countries worldwide, and it has provided corporate, trust and fund administration services for over 40 years. The petitions further allege that Trident Trust Group offers services that enable offshore account and entity concealment, like mail forwarding and retention, and ready-to-use “shelf” companies. For example, the petitions allege that Trident Trust Group personnel have listed themselves as the founders, directors and officers of thousands of Panamanian companies to help their U.S. clients potentially conceal their interests in and income from those foreign entities.

    A declaration from an IRS revenue agent that accompanied the petitions alleges that at least nine U.S. taxpayers used Trident Trust Group’s services to avoid compliance with U.S. tax laws. The declaration further alleges that the IRS learned of this noncompliance through the Offshore Voluntary Disclosure Program, a program that allowed U.S. taxpayers to voluntarily disclose foreign accounts or entities used to evade tax in exchange for settling their civil liabilities on fixed terms.

    These orders authorize the IRS to issue summonses to TT (USA) Holdings Inc.; Trident Corporate Services Inc.; Trident Fund Services Inc. and Trident Trust Company (South Dakota) Inc seeking information about U.S. taxpayer clients who may have used the services of the entities and the broader Trident Trust Group to establish, maintain, operate or control any foreign financial account or other foreign asset; any foreign corporation, company, trust, foundation or other legal entity or any foreign or domestic financial account or other asset in the name of such foreign entity from 2014 through 2023. By obtaining these records, the IRS expects to be able to identify clients of the Trident Trust Group to investigate whether they potentially used the group’s services to avoid or evade federal taxes.

    Additional information about the Tax Division and its enforcement efforts may be found on the division’s website.

    Tax Division Attorneys Christina T. Lanier and Brij B. Patnaik are handling the case in the U.S. District Court for the District of South Dakota; and they, along with Elisabeth K. Kryska of the Tax Division, are handling the case in the Northern District of Georgia. Assistant U.S. Attorney Anthony J. Sun for the Southern District of New York is handling the case in the U.S. District Court for the Southern District of New York.

    MIL OSI USA News –

  • MIL-OSI: Cegedim’s revenue grew 6.3% in 2024

    Source: GlobeNewswire (MIL-OSI)

         

    PRESS RELEASE

    Quarterly financial information as of December 31, 2024
    IFRS – Regulated information – Not audited

    Cegedim’s revenue grew 6.3% in 2024

    • Full year revenue rose 4.7% like for like to €654.5 million
    • Fourth quarter revenue grew 5.9% like for like to €178.7 million
    • All operating divisions contributed to growth in the fourth quarter

    Boulogne-Billancourt, France, January 30, 2025, after the market close

    Revenue

      Fourth quarter Change Q4 2024 / 2023
    in millions of euros 2024 2023

    reclassified(1)

    		 Reclassification(1) 2023

    Reported

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)(3)

    vs. reclassified(1)
    Software & Services 80.1 75.7 (8.7) 84.4 +5.8% +2.8%
    Flow 27.0 24.2 (0.6) 24.8 +12.0% +11.7%
    Data & Marketing 38.4 35.8 0.0 35.8 +7.1% +7.1%
    BPO 21.2 19.6 0.0 19.6 +7.8% +7.8%
    Cloud & Support 12.0 11.3 +9.3 2.0 +6.2% +6.2%
    Cegedim 178.7 166.6 0.0 166.6 +7.2% +5.9%
      Full year Change FY 2024 / 2023
    in millions of euros 2024 2023

    reclassified(1)

    		 Reclassification(1) 2023

    Reported

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)(4)

    vs. reclassified(1)
    Software & Services 307.8 302.3 (24.3) 326.6 +1.8% (1.2)%
    Flow 100.3 93.4 (2.5) 95.9 +7.3% +7.2%
    Data & Marketing 125.9 114.9 0.0 114.9 +9.6% +9.6%
    BPO 82.7 71.5 0.0 71.5 +15.8% +15.8%
    Cloud & Support 37.8 33.9 +26.8 7.1 +11.3% +11.3%
    Cegedim 654.5 616.0 0.0 616.0 +6.3% +4.7%

    Cegedim’s consolidated fourth quarter 2024 revenues rose to €178.7 million, up 7.2% as reported and 5.9% like for like(2) compared with the same period in 2023. All operating divisions contributed to like for like growth in the fourth quarter.

    Over the full year, revenues rose 6.3% as reported and 4.7% like for like compared with 2023. Marketing, health insurance, HR, and cloud businesses delivered the most solid growth over the full year. As expected, the Software & Services division felt the impact of comparisons with Ségur public health investment spending in 2023 and a slowdown in international sales because the Group decided to refocus its UK doctor software activities on Scotland, and then later decided to voluntarily place that business under administration.

    Analysis of business trends by division 

    • Software & Services
    Software & Services Fourth quarter Change Q4 2024 / 2023 Full year Change FY 2024 / 2023
    in millions of euros 2024 2023

    Reclassified(3)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)

    		 2024 2023

    reclassified(1)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)
    Cegedim Santé 21.3 18.1 +17.2% +1.8% 80.2 76.5 +4.8% (7.1)%
    Insurance, HR, Pharmacies, and other services 47.2 44.9 +5.1% +5.1% 176.7 173.3 +2.0% +1.9%
    International businesses 11.6 12.7 (8.2)% (3.5)% 50.9 52.5 (3.0)% (3.0)%
    Software & Services 80.1 75.7 +5.8% +2.8% 307.8 302.3 +1.8% (1.2)%

    Revenues at Cegedim Santé grew 17.2% as reported in the fourth quarter and 1.8% like for like. Reported growth over the full year came to 4.8%, but like-for-like revenues fell 7.1% due to the absence of Ségur public health investments, which generated revenue of €4.7 million in 2023. Reported growth includes Visiodent from March 1, 2024. The new subsidiary has already started marketing Group products like the Maiia appointment scheduling app and the Claude Bernard database to its clients, but those sales are not reflected in like-for-like growth.

    Others French subsidiaries saw reported revenue growth of 5.1% in the fourth quarter and 2% over the full year (1.9% LFL; Phealing acquired in Q4 2023). Over both the fourth quarter and the full year, the division was propelled by growth at the insurance businesses, thanks to robust project-based sales, and by HR, which is still getting a boost from its client diversification strategy. On the other hand, sales to pharmacies were down substantially—as they were at some of the competitors. This was partly because equipment sales slowed after many pharmacies updated their equipment in 2023. In addition, the pharmacy software business took in more than €2 million in Ségur public health investment revenues in 2023, creating a tough comparison.

    Internationally, revenues from software sales to UK doctors declined, as expected, following the Group’s decision early in the year to refocus the activity on Scotland. Unfortunately, the market proved too sluggish for this plan to succeed. On December 10, the Group decided to deconsolidate this subsidiary after announcing it would be voluntarily placed under administration. That move aggravated the drop in reported revenues in the fourth quarter, which came to 8.2%.

    Flow Fourth quarter Change Q4 2024 / 2023 Full year Change FY 2024 / 2023
    in millions of euros 2024 2023

    reclassified(1)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)

    		 2024 2023

    reclassified(1)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)
    e-business 15.0 14.0 +7.1% +6.7% 58.5 55.4 +5.6% +5.3%
    Third-party payer 12.0 10.2 +18.7% +18.7% 41.8 38.0 +9.9% +9.9%
    Flow 27.0 24.2 +12.0% +11.7% 100.3 93.4 +7.3% +7.2%

    Fourth-quarter growth in e-business, e-invoicing, and digitized data exchanges was 7.1%. The boost came from a rebound in Invoicing & Purchasing in France and a continued surge at the Healthcare Flow segment, which started early in the year, owing to dynamic new offerings for hospitals that are designed to make their drug purchasing secure. Growth over the full year was a solid 5.6%.

    The digital data flow business dealing with reimbursement of healthcare payments in France (Third-party payer) experienced 18.7% growth in Q4. It was boosted by strong growth in demand for its fraud and long-term illness detection offerings. Over the full year, this trend more than offset the transfer of revenue attributable to the Allianz contract—now attributed to the BPO business—and allowed the unit to post growth of 9.9%.

    • Data & Marketing
    Data & Marketing Fourth quarter Change Q4 2024 / 2023 Full year Change FY 2024 / 2023
    in millions of euros 2024 2023

    reclassified(1)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)

    		 2024 2023

    reclassified(1)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)
    Data 22.4 21.0 +6.3% +6.3% 65.5 64.5 +1.6% +1.6%
    Marketing 16.0 14.8 +8.2% +8.2% 60.4 50.4 +19.9% +19.9%
    Data & Marketing 38.4 35.8 +7.1% +7.1% 125.9 114.9 +9.6% +9.6%

    Data businesses posted 6.3% yoy growth in the fourth quarter, cementing an improvement over the second half, particularly in France. Thanks to its strong presence on the ground and its agility in adapting to customer demands, the Data business has been able to post positive growth of 1.6% in 2024, following a remarkable year in 2023.

    The Marketing segment had a solid fourth quarter, up 8.2%, and a record year, with growth of 19.9%. The performance showed the soundness of its phygital media strategy for pharmacies and was bolstered by special ad campaigns during the Olympics.

    BPO Fourth quarter Change Q4 2024 / 2023 Full year Change FY 2024 / 2023
                    in millions of euros 2024 2023

    Reclassified(4)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)

    		 2024 2023

    reclassified(1)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified
    Insurance BPO 15.4 14.0 +9.9% +9.9% 60.0 49.9 +20.2% +20.2%
    Business Services BPO 5.8 5.6 +2.8% +2.8% 22.7 21.6 +5.5% +5.5%
    BPO 21.2 19.6 +7.8% +7.8% 82.7 71.5 +15.8% +15.8%

    The Insurance BPO business grew by 9.9% over the fourth quarter, chiefly owing to its overflow business, which has been flourishing since the start of the year. Growth over the full year amounted to 20.2%, partly thanks to a favorable comparison stemming from the April 1, 2023, launch of the Allianz contract.

    Business Services BPO (HR and digitalization) reported growth of 2.8% in the fourth quarter and 5.5% over the full year on the back of a popular compliance offering and new clients.

    • Cloud & Support
    Cloud & Support Fourth quarter Change Q4 2024 / 2023 Full year Change FY 2024 / 2023
    in millions of euros 2024 2023

    reclassified(1)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)

    		 2024 2023

    reclassified(1)

    		 Reported

    vs. reclassified(1)

    		 Like for like(2)

    vs. reclassified(1)
    Cloud & Support 12.0 11.3 +6.2% +6.2% 37.8 33.9 +11.3% +11.3%

    The Cloud & Support division’s trajectory continued over the fourth quarter, with growth of 6.2% bringing FY growth to 11.3%. The progress reflects our expanded range of sovereign cloud-backed products and services, which earned the ANSSI security visa for SecNumCloud certification.

    Highlights

    Apart from the items cited below, to the best of the company’s knowledge, there were no events or changes during Q4 2024 that would materially alter the Group’s financial situation.

    On December 10, 2024, Cegedim announced that it had voluntarily placed its UK subsidiary—INPS, which sells software for doctors—under administration.

    Significant transactions and events post December 31, 2024
    To the best of the company’s knowledge, there were no post-closing events or changes after December 31, 2024, that would materially alter the Group’s financial situation.

    Outlook

    Like-for-like revenue growth(1) in 2024 was just below the bottom of the announced 5% to 8% range compared with 2023. Had the Group not refocused INPS on Scotland and then closed it later in the year, it would have met the 5% target. This performance is unlikely to jeopardize the outlook for recurring operating income, which is expected to continue improving.
    That said, the deconsolidation of INPS is likely to result in significant non-cash adjustments.
    These statements are not forecasts and are based on financial information that has not yet been audited.

    —————

    WEBCAST ON JANUARY 30, 2025 AT 6:15 PM (PARIS TIME)
    The webcast is available at: www.cegedim.fr/webcast
    The FY 2024 revenue presentation is available at:
    https://www.cegedim.fr/documentation/Pages/presentation.aspx

    Financial calendar:

    2025 March 27 after the close

    March 28 at 10:00 am

    April 24 after the close

    June 13 at 9:30

    July 24 after the close

    September 25 after the close

    September 26 at 10:00 am

    October 23 after the close

    		 2024 results

    SFAF meeting

    Q1 2025 revenues

    Shareholders’ general meeting

    H1 2025 revenues

    H1 2025 results

    SFAF meeting

    Q3 2025 revenues

    Financial calendar: https://www.cegedim.fr/finance/agenda/Pages/default.aspx

    Disclaimer
    This press release is available in French and in English. In the event of any difference between the two versions, the original French version takes precedence. It was sent to Cegedim’s authorized distributor on January 30, 2025, no earlier than 5:45 pm Paris time.
    The figures cited in this press release include guidance on Cegedim’s future financial performance targets. This forward-looking information is based on the opinions and assumptions of the Group’s senior management at the time this press release is issued and naturally entails risks and uncertainty. For more information on the risks facing Cegedim, please refer to Chapter 7, “Risk management”, section 7.2, “Risk factors and insurance”, and Chapter 3, “Overview of the financial year”, section 3.6, “Outlook”, of the 2023 Universal Registration Document filled with the AMF on April 3, 2024, under number D.24-0233.

    About Cegedim:
    Founded in 1969, Cegedim is an innovative technology and services group in the field of digital data flow management for healthcare ecosystems and B2B, and a business software publisher for healthcare and insurance professionals. Cegedim employs nearly
    6,700 people in more than 10 countries and generated revenue of over €654 million in 2024.
    Cegedim SA is listed in Paris (EURONEXT: CGM).
    To learn more please visit: www.cegedim.fr
    And follow Cegedim on X: @CegedimGroup, LinkedIn, and Facebook.

    Aude Balleydier
    Cegedim
    Media Relations
    and Communications Manager

    Tel.: +33 (0)1 49 09 68 81
    aude.balleydier@cegedim.fr

    		 Damien Buffet
    Cegedim
    Head of Financial
    Communication

    Tel.: +33 (0)7 64 63 55 73
    damien.buffet@cegedim.com

    		 Céline Pardo
    Becoming RP Agency
    Media Relations Consultant

    Tel.:        +33 (0)6 52 08 13 66
    cegedim@becoming-group.com

    		  

    ____________________________________________________________________________________________________________________________________________________

    (1) At constant scope and exchange rates.

    Annexes

    Breakdown of revenue by quarter and division

    in millions of euros   Q1 Q2 Q3 Q4 Total
    Software & Services   74.3 77.8 75.6 80.1 307.8
    Flow   25.4 24.2 23.7 27.0 100.3
    Data & Marketing   27.0 32.3 28.2 38.4 125.9
    BPO   20.2 19.7 21.6 21.2 82.7
    Cloud & Support   9.0 9.1 7.7 12.0 37.8
    Group revenue   155.9 163.1 156.8 178.7 654.5
    in millions of euros   Q1
    reclassified    		 Q2
    reclassified    		 Q3
    reclassified    		 Q4
    reclassified    		 Total
    reclassified
    Software & Services   74.4 76.2 76.0 75.7 302.3
    Flow   24.0 22.8 22.4 24.2 93.4
    Data & Marketing   24.6 30.3 24.1 35.8 114.9
    BPO   14.4 18.4 19.0 19.6 71.5
    Cloud & Support   8.4 7.4 6.8 11.3 33.9
    Group revenue   145.9 155.1 148.3 166.6 616.0

    Revenue breakdown by geographic zone, currency, and division at December 31, 2024

    as a % of consolidated revenues   Geographic zone   Currency
      France EMEA
    ex. France    		 Americas   Euro GBP Other
    Software & Services   83.5% 16.4% 0.1%   86.9% 11.4% 1.7%
    Flow   92.1% 7.9% 0.0%   94.6% 5.4% 0.0%
    Data & Marketing   97.9% 2.1% 0.0%   98.1% 0.0% 1.9%
    BPO   100.0% 0.0% 0.0%   100.0% 0.0% 0.0%
    Cloud & Support   99.9% 0.1% 0.0%   100.0% 0.0% 0.0%
    Cegedim Health Data UK   90.6% 9.3% 0.1%   92.2% 6.6% 1.2%

    (1)   As of January 1, 2024, our Cegedim Outsourcing and Audiprint subsidiaries—which were previously housed in the Software & Services division—as well as BSV—formerly of the Flow division—have been moved to the Cloud & Support division in order to capitalize on operating synergies between cloud activities and IT solutions integration.
    (2)   At constant scope and exchange rates.
    (3)   The positive currency impact of 0.2% was mainly due to the pound sterling. The positive scope effect of 1.1% was attributable to the first-time consolidation in Cegedim’s accounts of Visiodent starting March 1, 2024.
    (4)   The positive currency impact of 0.2% was mainly due to the pound sterling. The positive scope effect of 1.4% was attributable to the first-time consolidation in Cegedim’s accounts of Visiodent starting March 1, 2024.

    (1)   3To take advantage of synergies, Cegedim Outsourcing, Audiprint, and BSV have been reassigned to the Cloud & Support division.
    (2)   At constant scope and exchange rates.

    (1)   4To take advantage of synergies, Cegedim Outsourcing, Audiprint, and BSV have been reassigned to the Cloud & Support division.
    (2)   At constant scope and exchange rates.

    Attachment

    The MIL Network –

  • MIL-OSI: Truxton Corporation Reports Fourth Quarter and Full Year 2024 Results

    Source: GlobeNewswire (MIL-OSI)

    NASHVILLE, Tenn., Jan. 30, 2025 (GLOBE NEWSWIRE) — Truxton Corporation, the parent company for Truxton Trust Company (“Truxton” or “the Bank”) and subsidiaries, announced its operating results for the quarter ended December 31, 2024. Fourth quarter net income attributable to common shareholders was $4.99 million, or $1.74 per diluted share, compared to $4.23 million, or $1.46 per diluted share, for the same quarter in 2023.

    For the year ended December 31, 2024, net income increased by 5% to $18.4 million from $17.5 million in 2023. For the year ended December 31, 2024, earnings per diluted share rose to $6.34 from $6.02, an increase of 5% from 2023.

    “Truxton grew earnings again in 2024, despite the headwinds of mostly one-time expenses related to our technology and physical office upgrades,” said Truxton Chairman Tom Stumb. “Net Interest Income grew 7% and Wealth revenue increased 17% year-over-year, and we believe we are positioned well for 2025. Truxton continues to succeed as we drive successful outcomes for our clients through our dedication to service and sophisticated, sage advice.”

    Key Highlights

    • Non-interest income was $5.7 million in the fourth quarter of 2024, which was $173 thousand higher than the third quarter of 2024 and $1.4 million over the fourth quarter of 2023. Excluding gains and losses on the sale of securities, Wealth revenue constituted 90% of non-interest income in the fourth quarter of 2024, compared to 95% for the third quarter of 2024 and to 94% for fourth quarter of 2023. Other non-interest income was elevated due to a large non-recurring payment from an SBIC fund in which we are invested.
    • Non-interest expense was $230 thousand lower in the fourth quarter of 2024 compared to the third, driven largely by the timing of certain expense accruals and a refund of some costs related to our bank technology upgrade recognized in the third quarter.
    • Loans increased 1% to $670 million at quarter end compared to $665 million at September 30, 2024, and were up 2% compared to $658 million at December 31, 2023.
    • Total deposits decreased by 3% from $889 million at September 30, 2024, to $866 million at December 31, 2024, and were 11% higher in comparison to $782 million at December 31, 2023. Truxton continues to fund its growth from a single banking location led by its commitment to provide what it believes is superior deposit operations service and technology.
    • Asset quality remains sound at Truxton. The Bank had $11 thousand of non-performing assets at December 31, 2024. Truxton had $4 thousand in charge-offs in the fourth quarter of 2024, $9 thousand in the trailing quarter, and $8 thousand of recoveries in the fourth quarter of 2023.
    • Net interest margin for the fourth quarter of 2024 was 2.79%, an increase of 10 basis points from the 2.69% experienced in the quarter ended September 30, 2024, and an increase of 1 basis point from the 2.78% recorded in the quarter ended December 31, 2023. Cost of funds was 3.08% in the fourth quarter of 2024, down from 3.48% in the third quarter of 2024, and 3.15% in the fourth quarter of 2023.
    • Allowance for credit losses, excluding that for unfunded commitments, was $6.4 million at quarter end December 31, 2024, compared to $6.4 million at September 30, 2024, and $6.3 million at December 31, 2023. For those three periods, such allowance amounts were each 0.96% of gross loans outstanding at each period end. For the same three periods, the Bank’s allowance for unfunded commitments was $483 thousand, $409 thousand, and $412 thousand, respectively.
    • The Bank’s capital position remains strong. Its Tier 1 leverage ratio was 10.63% at December 31, 2024, compared to 10.46% at September 30, 2024, and 10.53% at December 31, 2023. Book value per common share was $34.42, $33.30, and $30.31 at December 31, 2024, September 30, 2024, and December 31, 2023, respectively.
    • During the twelve months ended December 31, 2024, Truxton Corporation paid dividends of $2.72 per common share, inclusive of a $1.00 special cash dividend, and repurchased 62,382 shares of its common stock for $4.2 million in the aggregate, or an average price of $66.97 per share.

    About Truxton
    Truxton is a premier provider of wealth, banking, and family office services for wealthy individuals, their families, and their business interests. Serving clients across the world, Truxton’s vastly experienced team of professionals provides customized solutions to its clients’ complex financial needs. Founded in 2004 in Nashville, Tennessee, Truxton upholds its original guiding principle: do the right thing. Truxton Trust Company is a subsidiary of financial holding company, Truxton Corporation (OTCPK: TRUX). For more information, visit truxtontrust.com.

    Investor Relations   Media Relations
    Austin Branstetter   Swan Burrus
    615-250-0783   615-250-0773
    austin.branstetter@truxtontrust.com   swan.burrus@truxtontrust.com
    Truxton Corporation
    Consolidated Balance Sheets
    (000’s)
    (Unaudited)
           
      December 31,
    2024*    		 September 30,
    2024*    		 December 31,
    2023*
    ASSETS      
    Cash and due from financial institutions $ 4,225   $ 5,499   $ 4,272  
    Interest bearing deposits in other financial institutions   25,698     24,678     3,417  
    Federal funds sold   4,054     4,816     1,537  
    Cash and cash equivalents   33,977     34,993     9,226  
           
    Time deposits in other financial institutions   245     245     490  
    Securities available for sale   258,322     295,905     259,926  
           
    Gross loans, excluding Paycheck Protection Program   669,962     664,630     657,811  
    Allowance for credit losses   (6,433 )   (6,358 )   (6,304 )
    Paycheck Protection Program Loans   20     27     29  
    Net loans   663,549     658,299     651,536  
           
    Bank owned life insurance   16,722     16,602     10,808  
    Restricted equity securities   2,272     2,261     1,858  
    Premises and equipment, net   3,293     3,328     189  
    Accrued interest receivable   4,567     4,954     4,388  
    Deferred tax asset, net   5,257     4,649     6,010  
    Other assets   15,577     14,017     10,839  
           
    Total assets $ 1,003,781   $ 1,035,253   $ 955,270  
           
           
    LIABILITIES AND SHAREHOLDERS’ EQUITY      
    Deposits      
    Non-interest bearing $ 126,016   $ 116,149   $ 123,918  
    Interest bearing $ 740,406   $ 772,612   $ 658,061  
    Total deposits   866,422     888,761     781,979  
           
    Federal funds purchased   –     –     –  
    Swap counterparty cash collateral   4,230     1,890     4,060  
    Federal Home Loan Bank advances   8,250     13,250     4,500  
    Federal Reserve Bank Term Funding Program advances   –     10,000     53,800  
    Subordinated debt   14,426     14,401     14,327  
    Other liabilities   11,747     11,405     8,922  
    Total liabilities   905,075     939,707     867,588  
           
    SHAREHOLDERS’ EQUITY      
    Common stock, $0.10 par value $ 286   $ 285   $ 289  
    Additional paid-in capital   28,945     28,729     31,457  
    Retained earnings   61,316     62,548     51,679  
    Accumulated other comprehensive income (loss)   (10,252 )   (9,434 )   (13,279 )
    Net Income $ 18,411   $ 13,418   $ 17,536  
    Total shareholders’ equity   98,706     95,546     87,682  
           
    Total liabilities and shareholders’ equity $ 1,003,781   $ 1,035,253   $ 955,270  
           
           
    *The information is preliminary, unaudited and based on company data available at the time of presentation.
           
    Truxton Corporation
    Consolidated Statements of Net Income
    (000’s)
    (Unaudited)
                       
      Three Months Ended   Year To Date
      December 31,
    2024*    		   September 30,
    2024*    		   December 31,
    2023*    		   December 31,
    2024*    		   December 31,
    2023*
    Non-interest income                  
    Wealth management services $ 5,242     $ 5,267   $ 4,435     $ 20,597     $ 17,657  
    Service charges on deposit accounts   85       92     111       360       461  
    Securities gains (losses), net   (122 )     0     (445 )     (335 )     (386 )
    Bank owned life insurance income   124       90     56       333       216  
    Other   391       98     115       1,164       524  
    Total non-interest income   5,720         5,547     4,272         22,119         18,472  
                       
    Interest income                  
    Loans, including fees $ 10,354     $ 10,654   $ 10,495     $ 41,721     $ 37,804  
    Taxable securities   3,039       3,361     2,554       11,932       9,350  
    Tax-exempt securities   217       222     210       834       876  
    Interest bearing deposits   348       488     198       1,475       695  
    Federal funds sold   75       113     41       288       101  
    Total interest income   14,033         14,838     13,498         56,250         48,826  
                       
    Interest expense                  
    Deposits   6,798       7,667     6,048       27,854       20,881  
    Short-term borrowings   90       260     685       1,294       2,154  
    Long-term borrowings   85       51     23       164       490  
    Subordinated debentures   188       188     187       752       771  
    Total interest expense   7,161         8,166     6,943         30,064         24,296  
                       
    Net interest income   6,872         6,672     6,555         26,186         24,530  
                       
    Provision for credit losses   145       105     215       217       296  
                       
    Net interest income after provision for loan losses   6,727         6,567     6,340         25,969         24,234  
                       
    Total revenue, net   12,447         12,114     10,612         48,088         42,706  
                       
    Non interest expense                  
    Salaries and employee benefits   4,635       4,044     3,563       16,652       14,810  
    Occupancy   326       315     272       1,578       1,185  
    Furniture and equipment   107       115     24       300       76  
    Data processing   282       625     389       1,763       1,703  
    Wealth management processing fees   195       221     166       838       729  
    Advertising and public relations   96       27     109       206       248  
    Professional services   247       609     285       1,337       941  
    FDIC insurance assessments   33       80     225       423       460  
    Other   291       406     322       2,024       901  
    Total non interest expense   6,212         6,442     5,355         25,121         21,053  
                       
    Income before income taxes   6,235         5,672     5,257         22,967         21,653  
                       
    Income tax expense   1,242       1,102     1,028       4,556       4,117  
                       
    Net income $ 4,993       $ 4,570     $ 4,229       $ 18,411       $ 17,536  
                       
    Earnings per share:                  
    Basic $ 1.74     $ 1.58   $ 1.46     $ 6.35     $ 6.04  
    Diluted $ 1.74     $ 1.57   $ 1.46     $ 6.34     $ 6.02  
             
    *The information is preliminary, unaudited and based on company data available at the time of presentation. Totals may not foot due to rounding.        
             
    Truxton Corporation  
    Selected Quarterly Financial data  
    At Or For The Three Months Ended  
    (000’s)  
    (Unaudited)  
             
      December 31,
    2024*    		 September 30,
    2024*    		 December 31,
    2023*    		  
             
    Per Common Share Data        
    Net income attributable to common shareholders, per share        
    Basic $1.74   $1.58   $1.46    
    Diluted $1.74   $1.57   $1.46    
    Book value per common share $34.42   $33.30   $30.31    
    Tangible book value per common share $34.42   $33.30   $30.31    
    Basic weighted average common shares 2,787,805   2,819,035   2,821,846    
    Diluted weighted average common shares 2,792,363   2,823,728   2,828,274    
    Common shares outstanding at period end 2,867,850   2,869,015   2,893,064    
             
             
    Selected Balance Sheet Data        
    Tangible common equity (TCE) ratio 9.83%   9.23%   9.18%    
    Average Loans $667,957   $652,624   $653,804    
    Average earning assets (1) $998,861   $1,006,370   $956,793    
    Average total assets $1,025,415   $1,029,802   $960,852    
    Average shareholders’ equity $97,026   $94,225   $81,759    
             
             
    Selected Asset Quality Measures        
    Nonaccrual loans $0   $0   $0    
    90+ days past due still accruing $11   $11   $0    
    Total nonperforming loans $11   $11   $0    
    Total nonperforming assets $11   $11   $0    
    Net charge offs (recoveries) $4   $9   ($8)    
    Nonperforming loans to assets 0.00%   0.00%   0.00%    
    Nonperforming assets to total assets 0.00%   0.00%   0.00%    
    Nonperforming assets to total loans and other real estate 0.00%   0.00%   0.00%    
    Allowance for credit losses to total loans 0.96%   0.96%   0.96%    
    Net charge offs to average loans 0.00%   0.00%   0.00%    
             
             
    Capital Ratios (Bank Subsidiary Only)        
    Tier 1 leverage 10.63%   10.46%   10.53%    
    Common equity tier 1 15.19%   15.17%   14.58%    
    Total risk-based capital 16.15%   16.11%   15.53%    
             
    Selected Performance Ratios        
    Efficiency ratio 48.45%   52.72%   47.07%    
    Return on average assets (ROA) 1.94%   1.77%   1.75%    
    Return on average shareholders’ equity (ROE) 20.47%   19.29%   20.52%    
    Return on average tangible common equity (ROTCE) 20.47%   19.29%   20.52%    
    Net interest margin 2.79%   2.69%   2.78%    
             
    *The information is preliminary, unaudited and based on company data available at the time of presentation.  
    (1) Average earning assets is the daily average of earning assets. Earning assets consists of loans, mortgage loans held for sale, federal funds sold, deposits with banks, and investment securities.  
             
    Truxton Corporation  
    Yield Tables  
    For The Periods Indicated  
    (000’s)  
    (Unaudited)  
                                   
    The following table sets forth the amount of our average balances, interest income or interest expense for each category of interest earning assets and interest bearing liabilities and the average interest rate for interest earning assets and interest bearing liabilities, net interest spread and net interest margin for the periods indicated below:  
     
     
      Three Months Ended   Three Months Ended   Three Months Ended  
      December 31, 2024*   September 30, 2024*   December 31, 2023*  
                                   
      Average
    Balances    		 Rates/
    Yields (%)    		   Interest
    Income/
    Expense    		   Average
    Balances    		 Rates/
    Yields (%)    		   Interest
    Income/
    Expense    		   Average
    Balances    		 Rates/
    Yields (%)    		   Interest
    Income/
    Expense    		  
                                   
    Earning Assets                              
    Loans $667,957   6.08   $10,215   $652,624   6.41   $10,520   $653,804   6.18   $10,183  
    Loan fees $0   0.09   $146   $0   0.08   $134   $0   0.19   $312  
    Loans with fees   667,957   6.17   $10,361     652,624   6.49   $10,654   $653,804   6.37   $10,495  
    Mortgage loans held for sale $0   0.00   $0   $0   0.00   $0   $0   0.00   $0  
    Federal funds sold $6,232   4.71   $75   $8,367   5.28   $113   $2,985   5.41   $41  
    Deposits with banks $28,570   4.85   $348   $35,784   5.43   $488   $14,240   5.51   $198  
    Investment securities – taxable $260,605   4.66   $3,039   $273,488   4.92   $3,361   $248,778   4.11   $2,554  
    Investment securities – tax-exempt $35,497   3.65   $217   $36,107   3.67   $222   $36,986   3.39   $210  
    Total Earning Assets $998,861   5.64   $14,040   $1,006,370   5.92   $14,838   $956,793   5.65   $13,498  
    Non interest earning assets                              
    Allowance for loan losses   (6,359)             (6,224)             (6,123)          
    Cash and due from banks $5,985           $6,529           $5,402          
    Premises and equipment $3,305           $3,370           $119          
    Accrued interest receivable $3,721           $3,746           $3,575          
    Other real estate $0           $0           $0          
    Other assets $36,453           $34,150           $30,404          
    Unrealized gain (loss) on inv. securities   (16,551)             (18,139)             (29,318)          
    Total Assets $1,025,415           $1,029,802           $960,852          
    Interest bearing liabilities                              
    Interest bearing demand $329,625   3.26   $2,703   $333,177   3.60   $3,018   $345,966   3.42   $2,984  
    Savings and money market $200,257   2.83   $1,427   $195,751   3.60   $1,773   $138,244   2.95   $1,027  
    Time deposits – retail $13,170   3.39   $112   $13,505   3.40   $115   $16,343   3.18   $131  
    Time deposits – wholesale $228,144   4.46   $2,556   $226,673   4.85   $2,761   $165,756   4.56   $1,906  
    Total interest bearing deposits $771,196   3.51   $6,798   $769,106   3.97   $7,667   $666,309   3.6   $6,048  
    Federal Home Loan Bank advances $9,554   3.48   $85   $5,728   3.50   $51   $4,500   1.98   $23  
    Subordinated debt $14,520   5.08   $188   $14,656   4.53   $188   $14,422   5.08   $187  
    Other borrowings $12,369   4.04   $90   $24,011   4.22   $259   $60,859   4.39   $685  
    Total borrowed funds $36,443   3.90   $363   $44,395   4.40   $499   $79,781   4.39   $895  
    Total interest bearing liabilities $807,639   3.52   $7,161   $813,501   3.99   $8,166   $746,090   3.69   $6,943  
    Net interest rate spread   2.12   $6,879     1.93   $6,672     1.96   $6,555  
    Non-interest bearing deposits $115,593           $118,216           $126,534          
    Other liabilities $5,157           $3,860           $6,469          
    Shareholder’s equity $97,026           $94,225           $81,759          
    Total Liabilities and Shareholder’s Equity $1,025,415           $1,029,802           $960,852          
    Cost of funds   3.08         3.48         3.15      
    Net interest margin   2.79         2.69         2.78      
                                   
               
    *The information is preliminary, unaudited and based on company data available at the time of presentation. Totals may not foot due to rounding.          
                                   
    Yield Table Assumptions – Average loan balances are inclusive of nonperforming loans. Yields computed on tax-exempt instruments are on a tax equivalent basis. Net interest spread is calculated as the yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. Net interest margin is the result of net interest income calculated on a tax-equivalent basis divided by average interest earning assets for the period. Changes in net interest income are attributed to either changes in average balances (volume change) or changes in average rates (rate change) for earning assets and sources of funds on which interest is received or paid. Volume change is calculated as change in volume times the previous rate while rate change is change in rate times the previous volume. Changes not due solely to volume or rate changes are allocated to volume change and rate change in proportion to the relationship of the absolute dollar amounts of the change in each category.
    Truxton Corporation  
    Yield Tables  
    For The Periods Indicated  
    (000’s)  
    (Unaudited)  
    The following table sets forth the amount of our average balances, interest income or interest expense for each category of interest earning assets and interest bearing liabilities and the average interest rate for interest earning assets and interest bearing liabilities, net interest spread and net interest margin for the periods indicated below:  
     
     
      Twelve Months Ended     Twelve Months Ended    
      December 31, 2024*     December 31, 2023*    
      Average
    Balances    		 Rates/
    Yields (%)    		   Interest
    Income/
    Expense    		     Average
    Balances    		 Rates/
    Yields (%)    		   Interest
    Income/
    Expense    		    
                             
    Earning Assets                        
    Loans $658,226   6.28   $41,328     $635,059   5.85   $37,150    
    Loan fees $0   0.08   $504     $0   0.10   $654    
    Loans with fees $658,226   6.36   $41,832     $635,059   5.95   $37,804    
    Mortgage loans held for sale $0   0.00   $0     $0   0.00   $0    
    Federal funds sold $5,592   5.08   $289     $1,907   5.21   $101    
    Deposits with banks $27,967   5.27   $1,475     $13,711   5.07   $695    
    Investment securities – taxable $259,313   4.6   $11,931     $247,483   3.78   $9,350    
    Investment securities – tax-exempt $34,867   3.57   $834     $38,410   3.40   $876    
    Total Earning Assets $985,965   5.76   $56,361     $936,570   5.26   $48,826    
    Non interest earning assets                        
    Allowance for loan losses   (6,299)               (6,087)            
    Cash and due from banks $6,161               5,960            
    Premises and equipment $2,662             $154            
    Accrued interest receivable $3,730             $3,271            
    Other real estate $0             $0            
    Other assets $33,513             $29,175            
    Unrealized gain (loss) on inv. securities   (19,553)               (26,891)            
    Total Assets $1,006,179             $942,152            
    Interest bearing liabilities                        
    Interest bearing demand $333,322   3.5   $11,681     $351,956   3.20   $11,247    
    Savings and Money Market $183,557   3.33   $6,121     $134,518   2.50   $3,368    
    Time deposits – Retail $14,275   3.41   $486     $17,168   2.53   $435    
    Time Deposits – Wholesale $207,457   4.61   $9,566     $143,922   4.05   $5,832    
    Total interest bearing deposits $738,611   3.77   $27,854     $647,564   3.22   $20,882    
    Federal home Loan Bank advances $5,476   2.95   $164     $12,355   3.91   $490    
    Subordinated debt $14,565   5.08   $752     $14,831   5.12   $771    
    Other borrowings $31,032   4.41   $1,294     $47,985   4.42   $2,153    
    Total borrowed funds $51,073   4.26   $2,210     $75,171   4.48   $3,414    
    Total interest bearing liabilities $789,685   3.80   $30,064     $722,735   3.36   $24,296    
    Net interest rate spread   1.95   $26,297       1.90   $24,530    
    Non-interest bearing deposits $119,150             $135,909            
    Other liabilities $4,424             $4,810            
    Shareholder’s equity $92,920             $78,619            
    Total Liabilities and Shareholder’s Equity $1,006,179             $942,073            
    Cost of funds   3.30           2.82        
    Net interest margin   2.71           2.67        
                             
    *The information is preliminary, unaudited and based on company data available at the time of presentation.          
     
    Yield Table Assumptions – Average loan balances are inclusive of nonperforming loans. Yields computed on tax-exempt instruments are on a tax equivalent basis. Net interest spread is calculated as the yields realized on interest-bearing assets less the rates paid on interest-bearing liabilities. Net interest margin is the result of net interest income calculated on a tax-equivalent basis divided by average interest earning assets for the period. Changes in net interest income are attributed to either changes in average balances (volume change) or changes in average rates (rate change) for earning assets and sources of funds on which interest is received or paid. Volume change is calculated as change in volume times the previous rate while rate change is change in rate times the previous volume. Changes not due solely to volume or rate changes are allocated to volume change and rate change in proportion to the relationship of the absolute dollar amounts of the change in each category.
     

    The MIL Network –

  • MIL-OSI Russia: IMF Executive Board Concludes 2024 Article IV Consultation with South Africa

    Source: IMF – News in Russian

    January 30, 2025

    Washington, DC: The Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation[1] with South Africa.

    South Africa’s economy has continued to face challenges in recent years. Power shortages and disruptions to rail and port operations constrained growth to 0.7 percent in 2023. Activity remained subdued in 2024, given election-related uncertainty in the first half of the year and severe droughts. Nonetheless, power generation was stabilized and, following the formation of a reform-oriented Government of National Unity in June, consumer, business, and investor confidence rebounded. Inflation moderated from 5.9 percent in 2023 to an estimated
    4.5 percent in 2024, with the central bank cutting interest rates by 50 basis points in 2024. While still high, unemployment declined to an estimated 32.8 percent in 2024. Government deficits remained elevated, pushing public debt to above 75 percent of GDP by end-2024.

    Looking ahead, real GDP growth is projected to accelerate to 1.5 percent in 2025, driven by recovering private consumption and investment supported by stable electricity generation. Over the medium term, annual growth is expected to reach 1.8 percent, as investment improves gradually on the back of ongoing reform efforts to address electricity and logistics bottlenecks. Inflation is projected to average 4 percent in 2025 and stabilize at the midpoint of the SARB’s target range (4.5 percent) in the medium run. With fiscal deficits projected to stay elevated over the medium term, public debt is expected to continue to rise.

    The outlook remains marked by high uncertainty, with the balance of risks tilted to the downside. Key downside external risks relate to a further deepening of geoeconomic fragmentation and intensification of protectionist policies, an escalation of ongoing conflicts, a deeper slowdown in main trading partners, or slower global disinflation and tightening financial conditions. Domestically, resistance to and delays in the implementation of needed reforms could add to downside risks. On the upside, faster and more ambitious reform implementation by the new government, or stronger global growth, could boost confidence and growth.   

    Executive Board Assessment[2]

    “Directors agreed with the thrust of the staff appraisal. They welcomed South Africa’s new Government of National Unity and its commitment to reforms aimed at addressing long‑standing challenges. While there are signs of recovery, economic activity remains subdued amid heightened global uncertainty and long‑standing structural impediments. Against this background, Directors emphasized the importance of prudent macroeconomic policies complemented by ambitious structural reforms to support macroeconomic stability and place the economy on a path toward higher, more inclusive, and greener growth.

    “Directors welcomed the authorities’ commitment to fiscal prudence, including plans to reduce the fiscal deficit and stabilize debt. Given increased risks, most Directors called for more ambitious fiscal consolidation efforts to lower debt to more prudent levels and rebuild fiscal buffers, although a few felt that the authorities’ preferred approach may be more appropriate given political economy considerations. Directors considered that an evenly paced fiscal consolidation focused on cutting inefficient spending while protecting priority social and infrastructure spending, and continuing to strengthen tax administration, can support debt sustainability while minimizing the negative impact on the economy. Most Directors agreed that introducing a prudent debt anchor supported by a fiscal rule could help underpin the adjustment and bolster credibility, although a few Directors felt that a debt ceiling could constrain flexibility. Enhancing fiscal transparency and risk management can further support the resilience of public finances.

    “Directors commended the South African Reserve Bank’s effective monetary management, which supported a decline in inflation. Looking forward, they recommended maintaining a flexible and data‑driven approach to monetary policy decisions amid ongoing uncertainties. Directors saw merit in shifting, at an opportune time, from the current inflation target band to a lower point target, which will require careful design, gradual implementation, close coordination, and appropriate communication.

    “Directors welcomed the authorities’ efforts to safeguard financial stability, including recent banking‑resolution and safety‑net reforms and macro‑prudential policies. They encouraged the authorities to continue to monitor risks, including those related to the sovereign‑bank nexus, and to stand ready to implement prudential measures as needed. They considered that strengthened supervision, including for non‑bank financial institutions, alongside continued efforts to bolster the AML/CFT framework, remain essential.

    “Directors commended the authorities for their structural reform efforts aimed at removing critical impediments to growth. They encouraged the new government to implement resolutely ongoing energy and logistics reforms, including by promoting private sector participation. To support higher and greener growth and job creation, particularly among the youth, while reducing inequality and poverty, Directors recommended additional reforms to enhance the business environment, bolster governance, and improve labor market flexibility, along with sustained efforts to facilitate trade and achieve climate goals.

    Directors wished the authorities success during South Africa’s G20 Presidency and welcomed their leadership in support of multilateral cooperation.”

     

    South Africa: Selected Economic Indicators, 2022–27

    Social Indicators

    GDP

    Poverty (percent of population)

    Nominal GDP (2022, billions of US dollars)

    407

    Lower national poverty line (2015)

    40

    GDP per capita (2022, in US dollars)

    6,712

    Undernourishment (2019)

    7

    Population characteristics

    Inequality (income shares unless otherwise specified)

    Total (2022, million)

    62

    Highest 10 percent of population (2015)

    53

    Urban population (2020, percent of total)

    67

    Lowest 40 percent of population (2015)

    7

    Life expectancy at birth (2020, number of years)

    64

    Gini coefficient (2015)

    65

    Economic Indicators

    2022

    2023

    2024

    2025

    2026

    2027

    Proj.

    National Income and Prices

    (Annual Percentage Change Unless Otherwise Indicated)

    Real GDP

    1.9

    0.7

    0.8

    1.5

    1.6

    1.7

    Domestic demand

    3.9

    0.8

    0.4

    1.5

    1.6

    1.8

    Private Consumption

    2.5

    0.7

    1.2

    1.4

    1.5

    1.6

    Government Consumption

    0.6

    1.9

    1.0

    1.0

    1.2

    1.3

    Gross Fixed Investment

    4.8

    3.9

    -3.4

    2.5

    2.7

    3.1

    Inventory Investment (contribution to growth)

    1.5

    -0.6

    0.0

    0.0

    0.0

    0.0

    Net export (contribution to growth)

    -2.1

    -0.1

    0.4

    0.1

    -0.1

    -0.1

    Real GDP per capita 1/

    1.1

    -0.8

    -0.7

    0.1

    0.1

    0.2

    GDP deflator

    5.0

    4.8

    4.4

    4.1

    4.5

    4.5

    CPI (annual average)

    6.9

    5.9

    4.5

    4.0

    4.5

    4.5

    CPI (end of period)

    7.4

    5.5

    3.0

    4.5

    4.5

    4.5

    Labor Market

    (Annual Percentage Change Unless Otherwise Indicated)

    Unemployment rate (percent of labor force, annual average)

    33.5

    33.1

    32.8

    32.7

    32.5

    32.3

    Unit labor costs (formal nonagricultural)

    2.1

    -0.8

    -0.7

    0.1

    0.1

    0.2

    Savings and Investment (Percent of GDP)

    Gross national saving

    15.0

    13.9

    13.2

    12.9

    13.0

    13.0

    Investment (including inventories) 2/

    15.4

    15.5

    14.5

    14.6

    14.8

    15.0

    Fiscal Position

    (Percent of GDP Unless Otherwise Indicated) 3/

    Revenue, including grants 4/

    27.6

    26.8

    26.8

    26.8

    26.9

    26.9

    Expenditure and net lending

    31.9

    32.7

    32.9

    33.3

    32.6

    32.3

    Overall balance

    -4.3

    -5.9

    -6.1

    -6.6

    -5.8

    -5.4

    Primary balance

    0.3

    -0.9

    -0.7

    -1.0

    -0.1

    0.4

    Gross government debt 5/

    70.8

    73.4

    75.7

    78.3

    80.1

    81.7

    Government bond yield (10-year and over, percent)

    10.7

    11.6

    11.2

    …

    …

    …

    Money and Credit

    (Annual Percentage Change Unless Otherwise Indicated)

    Broad money

    8.3

    7.9

    5.2

    5.7

    6.2

    6.3

    Credit to the private sector 6/

    8.2

    4.1

    5.0

    5.6

    6.2

    6.3

    Repo rate (percent, end-period)

    7.0

    8.25

    7.75

    …

    …

    …

    3-month Treasury bill interest rate (percent)

    5.2

    8.0

    8.3

    …

    …

    …

    Private sector credit growth (total) 7/

    9.2

    4.8

    4.3

    …

    …

    …

    Credit growth (households) 8/

    7.7

    4.4

    3.1

    …

    …

    …

    Credit growth (corporates) 8/

    10.7

    5.2

    6.4

    …

    …

    …

    Balance of Payments

    (Annual Percentage Change Unless Otherwise Indicated)

    Current account balance (billions of U.S. dollars)

    -1.8

    -6.1

    -5.3

    -7.3

    -7.8

    -8.9

    percent of GDP

    -0.5

    -1.6

    -1.3

    -1.7

    -1.8

    -2.0

    Exports growth (volume)

    7.4

    3.5

    -4.0

    2.7

    2.8

    2.9

    Imports growth (volume)

    14.9

    4.1

    -4.9

    2.2

    3.0

    3.2

    Terms of trade

    -8.6

    -4.8

    1.7

    -1.7

    -0.3

    0.0

    Overall balance (percent of GDP)

    0.0

    0.5

    0.8

    0.0

    0.0

    0.0

    Gross reserves (billions of U.S. dollars)

    60.6

    62.5

    65.9

    65.9

    65.9

    65.9

    in percent of ARA

    88.9

    97.0

    97.1

    …

    …

    …

    Total external debt (percent of GDP)

    40.4

    41.5

    43.2

    44.7

    45.1

    45.6

    Nominal effective exchange rate (period average)

    16.6

    18.8

    18.6

    …

    …

    …

    Real effective exchange rate (period average)

    6.8

    7.7

    7.5

    …

    …

    …

    Exchange rate (Rand/U.S. dollar, end-period)

    17.0

    18.5

    18.7

    …

    …

    …

    Sources: Bloomberg, Haver, National Treasury South Africa, SARB, World Bank, and IMF staff calculations.

    1/ Per-capita GDP figures are computed using STATS SA mid-year population estimates.

    2/ Inventories data are volatile and excluded from the investment breakdown to help clarify fixed capital formation developments.

    3/ Consolidated government as defined in the budget unless otherwise indicated.

    4/ Revenue excludes “transactions in assets and liabilities” classified as part of revenue in budget documents. This item represents proceeds from the sales of assets, realized valuation gains from holding of foreign currency deposits, and other conceptually similar items, which are not classified as revenue by the IMF’s Government Finance Statistics Manual 2014.

    5/ Central government.

    6/ Depository institution’s domestic claims on private sector in all currencies.

    7/ Credit extended by all monetary institutions/ Claims on the domestic private sector/ Total loans & advances. Data for 2024 is as of November.

    8/ Data for 2024 is as of August.

    [1] Under Article IV of the IMF’s Articles of Agreement, the IMF holds bilateral discussions with members, usually every year. A staff team visits the country, collects economic and financial information, and discusses with officials the country’s economic developments and policies. On return to headquarters, the staff prepares a report, which forms the basis for discussion by the Executive Board.

    [2] At the conclusion of the discussion, the Managing Director, as Chair of the Board, summarizes the views of Executive Directors, and this summary is transmitted to the country’s authorities. An explanation of any qualifiers used in summings up can be found here: http://www.IMF.org/external/np/sec/misc/qualifiers.htm.

    IMF Communications Department
    MEDIA RELATIONS

    PRESS OFFICER: Tatiana Mossot

    Phone: +1 202 623-7100Email: MEDIA@IMF.org

    https://www.imf.org/en/News/Articles/2025/01/29/pr-2519-south-africa-imf-executive-board-concludes-2024-article-iv-consultation

    MIL OSI

    MIL OSI Russia News –

  • MIL-OSI: Military Drones Market Heating Up as Multi-Billion Dollar Industry Realizing Rapidly Increasing Demand

    Source: GlobeNewswire (MIL-OSI)

    PALM BEACH, Fla. , Jan. 30, 2025 (GLOBE NEWSWIRE) — FN Media Group News Commentary – Military drone refers to unmanned aerial vehicles that are specifically used for military purposes such as border surveillance, battle damage management, combat operations, communication, delivery, and anti-terrorism weaponry. The main types of military drones are fixed-wing, rotary-wing, and hybrid. A fixed-wing drone is a plane that doesn’t have a human pilot on board. Fixed-wing UAVs can be commanded remotely by a human or Autonomously by onboard systems. The different types of drones include MALE, HALE, TUAV, UCAV, SUAV and involve various technologies such as remotely operated, semi-autonomous, autonomous. It is used in Search And Rescue, national defense, military exercises, and others. According to a report from The Business Research Company, the military drones market size has grown strongly in recent years. It will grow from $15.93 billion in 2024 to $17.05 billion in 2025 at a compound annual growth rate (CAGR) of 7.0%. The growth in the historic period can be attributed to increasing military expenditure, increasing the use of military drones, increasing government funding for military drones and low interest rates. The report said: “The military drones market size is expected to see strong growth in the next few years. The growth in the forecast period can be attributed to an increase in government funds and increasing internal and external security threats. Major trends in the forecast period include strategic mergers and acquisitions, focus on use of 3D printing, use of the internet of things (IoT), focus on implementing autonomous systems and focusing on implementing emerging technologies such as artificial intelligence (AI).” Active Companies in the markets today include ZenaTech, Inc. (NASDAQ: ZENA), Northrop Grumman Corporation (NYSE: NOC), AeroVironment, Inc. (NASDAQ: AVAV), The Boeing Company (NYSE: BA), Red Cat Holdings, Inc. (NASDAQ: RCAT).

    The Business Research Company concluded: “The increasing terrorism is expected to boost the growth of the military drone market going forward. Terrorism refers to an act of violence that would put others in danger while showing a blatant disdain for the harm IT would do. Governments and military organizations often use military drones in counter-terrorism efforts. Drones can provide valuable intelligence, surveillance, and reconnaissance (ISR) capabilities to monitor and track terrorist activities. The need for real-time data and actionable intelligence in counter-terrorism operations drives the demand for military drones… Asia-Pacific was the largest region in military drones’ market in 2024. Western Europe is expected to be the fastest-growing region in the global military drones market share during the forecast period.”

    ZenaTech (NASDAQ:ZENA) Announces Spider Vision Sensors Collaborates with Suntek Global to Apply for First Blue UAS Certification of IQ Nano Drone Sensor for US Defense – ZenaTech, Inc. (FSE: 49Q) (BMV: ZENA) (“ZenaTech”), a technology company specializing in AI (Artificial Intelligence) drone, Drone-as-a-Service (DaaS), enterprise SaaS and Quantum Computing solutions, announces that its subsidiaries ZenaDrone and Spider Vision Sensors are collaborating with Taiwan-based certified electronics manufacturer and partner, Suntek Global, to apply for the company’s first Blue UAS (Unmanned Aerial System) certified IQ Nano drone sensor for use by US Defense branches.

    A drone sensor is a device onboard a drone that collects data, such as cameras for imaging, LiDAR for mapping, or infrared sensors for thermal detection. Military and Defense departments use small autonomous indoor drones like the 10X10 inch IQ Nano for various applications such as inventory management, indoor building reconnaissance, search and rescue, training simulations, and explosives detection.

    “We have been working with Suntek on Blue UAS certification for our cameras and sensors since signing a partnership agreement in early December, in conjunction with our Spider Vision Sensors manufacturing subsidiary in Taiwan,” said CEO Shaun Passley, Ph.D. “Our immediate goal is to utilize Suntek’s expertise having achieved Blue UAS certification, to help us source and manufacture our own compliant components as well as help us with the Blue UAS application process for our components and the IQ Nano drone. If approved, the drone is placed on the Blue UAS Cleared List, allowing military and federal agencies to directly purchase our drones.

    “The IQ Nano drone is ideal for indoor operations in scenarios requiring precision, maneuverability, and minimal collateral damage, and can also improve efficiency and costs managing inventories of supplies in the Department of Defense (DoD) warehouse and storage facilities,” concluded Dr. Passley.

    The company also intends to file for the less stringent and faster to achieve Green UAS certification for IQ Nano sensor and the drone in the second quarter of 2025. The Green certification is considered a pathway to the Blue certification list, with the main difference being that it is a commercial certification for secure drones led by a drone industry association (AUVSI). The Blue UAS is a military-grade approval for DoD use and has strict country of origin requirements that must not include a set list of Chinese suppliers. The Blue UAS Certification Process for DoD use is managed by the Defense Innovation Unit (DIU) and includes additional security and performance evaluations. Continued… Read this full release for ZENA by visiting: https://www.financialnewsmedia.com/news-zena/

    Other recent developments in the defense/military industry include:

    Northrop Grumman Corporation (NYSE: NOC) recently announced that its fourth quarter and full-year 2024 financial results will be posted on its investor relations website on January 30, 2025. Prior to the market opening, the company will issue an advisory release notifying the public of the availability of the complete and full text earnings release on the company’s website at http://investor.northropgrumman.com.

    The company’s fourth quarter and 2024 conference call will be held at 9 a.m. Eastern time, Thursday, January 30, 2025. The conference call will be webcast live on Northrop Grumman’s website at http://investor.northropgrumman.com. Replays of the call will be available on the Northrop Grumman website for a limited time. Presentations may be supplemented by a series of slides appearing on the company’s investor relations home page.

    AeroVironment, Inc. (NASDAQ: AVAV) recently reported financial results for the fiscal second quarter ended October 26, 2024. Second Quarter Highlights were: Record second quarter revenue of $188.5 million up 4% year-over-year; Second quarter net income of $7.5 million and non-GAAP adjusted EBITDA of $25.9 million; Funded backlog of $467.1 million as of October 26, 2024; and announced its entry into an agreement for the acquisition of BlueHalo in an all-stock transaction with an enterprise value of approximately $4.1 billion.

    “AeroVironment continues to deliver strong results, including record second-quarter revenue along with a healthy funded backlog that is 25% higher than the prior quarter,” said Wahid Nawabi, AeroVironment chairman, president and chief executive officer. “Key wins from our Loitering Munition Systems segment continue to drive growth for the company.

    “We expect our proposed acquisition of BlueHalo to further advance our growth opportunities with a highly complementary portfolio of products, customers and capabilities in key defense space and intelligence sectors and establish AeroVironment as the next generation defense technology company for our customers. We look forward to continued momentum beyond fiscal year 2025.”

    The Boeing Company (NYSE: BA) recently released Fourth Quarter Results which were: Finalized the International Association of Machinists and Aerospace Workers (IAM) agreement and resumed production across the 737, 767 and 777/777X programs; Financials reflect previously announced impacts of the IAM work stoppage and agreement, charges for certain defense programs, and costs associated with workforce reductions announced last year; Revenue of $15.2 billion, GAAP loss per share of ($5.46) and core (non-GAAP) loss per share of ($5.90); and Operating cash flow of ($3.5) billion; cash and marketable securities of $26.3 billion. Full Year 2024; Delivered 348 commercial airplanes and recorded 279 net orders; Total company backlog grew to $521 billion, including over 5,500 commercial airplanes.

    The Boeing Company [NYSE: BA] recorded fourth quarter revenue of $15.2 billion, GAAP loss per share of ($5.46) and core loss per share (non-GAAP) of ($5.90) (Table 1) primarily reflecting previously announced impacts of the IAM work stoppage and agreement, charges for certain defense programs, and costs associated with workforce reductions announced last year. Boeing reported operating cash flow of ($3.5) billion and free cash flow of ($4.1) billion (non-GAAP).

    “We made progress on key areas to stabilize our operations during the quarter and continued to strengthen important aspects of our safety and quality plan,” said Kelly Ortberg, Boeing president and chief executive officer. “My team and I are focused on making the fundamental changes needed to fully recover our company’s performance and restore trust with our customers, employees, suppliers, investors, regulators and all others who are counting on us.”

    Red Cat Holdings, Inc. (NASDAQ: RCAT), a drone technology company integrating robotic hardware and software for military, government, and commercial operations, recently announced it has secured new orders for its Edge 130 drone from the Army National Guard and another U.S. Government Agency (OGA), totaling $518,000.

    FlightWave, a leading provider of VTOL drone, sensor and software solutions was acquired by Red Cat in September 2024. The acquisition brought FlightWave’s flagship drone, the Edge 130 Blue into its family of low-cost, portable unmanned reconnaissance and precision lethal strike systems. FlightWave’s size, weight and vertical take off capabilities makes it ideal for maritime operations and littoral environments.

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    This release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E the Securities Exchange Act of 1934, as amended and such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may”, “future”, “plan” or “planned”, “will” or “should”, “expected”, “anticipates”, “draft”, “eventually” or “projected”. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward-looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in a company’s annual report on Form 10-K or 10-KSB and other filings made by such company with the Securities and Exchange Commission. You should consider these factors in evaluating the forward-looking statements included herein, and not place undue reliance on such statements. The forward-looking statements in this release are made as of the date hereof and FNM undertakes no obligation to update such statements.

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    The MIL Network –

  • MIL-OSI Economics: Greece: Staff Concluding Statement of the 2025 Article IV Consultation Mission

    Source: International Monetary Fund

    January 30, 2025

    A Concluding Statement describes the preliminary findings of IMF staff at the end of an official staff visit (or ‘mission’), in most cases to a member country. Missions are undertaken as part of regular (usually annual) consultations under Article IV of the IMF’s Articles of Agreement, in the context of a request to use IMF resources (borrow from the IMF), as part of discussions of staff monitored programs, or as part of other staff monitoring of economic developments.

    The authorities have consented to the publication of this statement. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Based on the preliminary findings of this mission, staff will prepare a report that, subject to management approval, will be presented to the IMF Executive Board for discussion and decision.

    Greece’s near-term economic outlook remains favorable, with real GDP sustaining its robust expansion. The public finances have further improved, with the public debt-to-GDP ratio on a firm downward trajectory, amid continued fiscal consolidation supported by strong progress in reducing tax evasion. Continuing the reform momentum will establish a solid foundation to address remaining crisis legacies and structural challenges arising from the rising yet still low level of overall investment, an unfavorable demographic outlook, and sluggish productivity growth. The right policy mix aimed at continuing fiscal consolidation in a growth-friendly manner, implementing ambitious reforms to address supply-side structural impediments, and further strengthening financial system resilience is essential to achieve sustainable growth in the medium to long term, while ensuring fiscal sustainability and safeguarding financial stability.

    Robust Expansion with Declining Debt

    1. The economy maintained its robust growth in 2024, supported by strong domestic demand. Real GDP expanded by 2.3 percent (year-on-year; y/y) in the first three quarters, buoyed by a strong pickup in NGEU-funded investment projects and robust private consumption underpinned by rising real income. The unemployment rate fell to 9.5 percent (seasonally adjusted) in 2024Q3, a historic low since 2009, and the vacancy rate has risen, reflecting labor shortages in a few sectors, particularly construction, tourism-related services, and high-skill sectors. The labor force participation rate has also gradually risen but remains among the lowest in EU, especially for women. Disinflation is underway at a gradual pace with headline and core inflation at 2.9 and 3.4 percent (y/y) in end-2024, respectively, amid persistent services inflation and wage growth. Along with strong economic activity, credit growth to the private sector has accelerated to 9.4 percent (y/y) in 2024Q4, accompanied by a continued increase in residential real estate prices. High domestic import demand, driven by investment, also contributed to the widening of the current account deficit to an estimated 6.9 percent of GDP in 2024.

    2. Continued fiscal consolidation and sustained progress in much-needed structural reforms have strengthened the public finances, growth potential, and energy security. By end-2024, the public debt-to-GDP ratio is estimated to have decreased by more than 50 percentage points from its peak in 2020, supported by strong growth, high inflation, and substantial fiscal consolidation. While the labor tax wedge has been reduced by about 4½ percentage points since 2019, tax revenue has remained buoyant due to the authorities’ strong progress in reducing tax evasion. The abolishment of substantial pension penalties for retirees re-entering the labor market significantly increased the number of working pensioners in 2024. Following the significant expansion of solar and wind capacity in recent years, renewable sources now account for about 50 percent of total electricity generation.

    3. The banking system has further enhanced its resilience with improved asset quality and capital adequacy. Asset quality in systemically important banks has improved further, with the NPL ratio dropping to around 3 percent in 2024Q3, facilitated by a government-sponsored securitization framework. Banks sustained high profits, which, along with capital instrument issuances, have boosted capital adequacy, although there is room for a further strengthening of voluntary capital buffers. The capital quality needs to be further improved as Deferred Tax Credit (DTC) still represents a substantial share of prudential capital. Given repayment of the Targeted Longer-Term Refinancing Operations (TLTROs) and meeting the Minimum Requirement for Own Funds and Eligible Liabilities (MREL) targets, liquidity and funding risks have been markedly reduced, with buffers well above prudential requirements and the EU average.

    4. Real GDP growth is projected to remain high at 2.1 percent in 2025, before moderating in the medium term. Investment will continue to be a key driver, supported by NGEU-funded projects. Private consumption growth will remain solid, underpinned by favorable employment and income growth. With stabilizing global energy prices, headline inflation is expected to resume its downward trend, while core inflation will be more persistent due to services inflation and wage growth. With NGEU funding set to expire against the backdrop of demographic headwinds and sluggish productivity growth, GDP growth is forecast to moderate to lower levels around 1¼ percent in the medium term. The current account deficit is expected to narrow gradually below 4 percent of GDP in the medium term, as imports are expected to slow along with the winding down of NGEU-funded investment.

    5. Risks to the growth outlook are balanced, while those to inflation are tilted upward. Potential headwinds include the growth slowdown in major euro area countries, a deterioration of regional conflicts, and global policy uncertainty. The acceleration of ambitious structural reforms could further improve growth prospects. Stronger and more persistent-than-expected wage growth could further fuel services inflation, potentially exacerbated by fluctuations in global and regional energy prices.

    Growth-friendly Fiscal Consolidation

    6. Continued fiscal consolidation would further strengthen public debt sustainability. The primary surplus is expected to remain high at around 2½ percent of GDP in 2025 as reduced revenue from an additional cut in social security contributions is expected to be broadly offset by revenue gains from reforms aimed at reducing tax evasion and increasing tax compliance. With the primary surplus remaining high at 2.3 percent of GDP in the medium term, the public debt-to-GDP ratio is projected to decrease further by about 25 percentage points to below 130 percent by 2030.

    7. Additional expenditure measures that raise efficiency would further strengthen Greece’s public finances. Continued reforms are necessary to enhance efficient public investment planning and management, including through further strengthening centralized coordination and procurement. It is essential to protect non-pension social spending, such as healthcare and education, to promote inclusive growth, while enhancing efficiency. Excessive increases in pensions and public-sector wages should be resisted by implementing recent reforms, for example by ensuring that pension increases adhere to the established indexation formula without ad hoc adjustment.

    8. There is room for additional revenue-enhancing reforms to further reduce tax evasion while enhancing the progressivity of the tax system. The Independent Authority for Public Revenue’s new medium-term strategy presents a good opportunity to further modernize tax administration and increase tax collection by continuing to leverage digitalization, which also reduces the burden of compliance. Tax policy reforms should focus on broadening the tax base and increasing tax progressivity. Additionally, inefficient tax expenditures, particularly the regressive VAT exemptions on some goods and services, should be phased out. The authorities should also consider raising carbon pricing, particularly in the transport and industry sectors, which can generate revenue for improved social protection and help address climate change and energy security by sharpening market incentives.

    9. Fiscal space created by additional measures or better-than-expected performance should be used for debt reduction as well as crucial social and capital spending. While public debt remains high, there are significant infrastructure investment needs, especially for energy security and in support of the green transition. The authorities should also consider enhancing support for crucial social expenditures, such as healthcare, and education with increased targeting toward the poor and vulnerable to promote inclusive growth.

    Structural reforms for boosting potential growth

    10. Comprehensive reforms to address structural supply-side impediments would increase productivity and medium-term growth prospects.

    • Raising labor force participation and ensuring a better skilled workforce. Increasing the availability of childcare and elderly care facilities can enable women to engage more productively in the economy. Reducing the still high tax wedge, coupled with appropriate job search and phasing out certain features of the unemployment benefit within the eligibility period, can enhance work incentives. Upgrading and scaling up the lifelong learning system with effective private sector participation, particularly in digital and green skills, as well as healthcare, can reduce skill mismatches and help alleviate bottlenecks for youth and female employment.
    • Accelerating regulatory reforms. Further reducing the regulatory burden and barriers to entry for firms, particularly in the services sector, would foster competition, increase productivity, and promote investment. Promoting business dynamism and fostering robust job creation are essential for effectively integrating new labor force entrants, particularly women, into employment. The quality of regulation needs to be improved by leveraging digitalization and enhancing regulatory impact assessments. Further enlarging and deepening the European single market would allow firms to grow to scale and lift productivity.
    • Advancing judicial system reforms. Progress in the implementation of the new insolvency framework, which is essential for addressing a large stock of crisis legacy distressed debt, has been hindered by imbalances and rigidities in the functioning of the civil judiciary system. In line with the recent judicial reform program, efforts should focus on accelerating the resolution of court cases. Such reforms would not only enhance financial sector resilience but also promote productive growth by facilitating the reallocation of capital to more productive activities and higher investment.

    11. Continued progress in green and digital transition will help achieve energy security and further boost productivity growth. Improving power connectivity with distant islands and enhancing energy efficiency in industries and transportation are essential for achieving the updated climate goals. Building on the ongoing increase in solar and wind capacity, scaling up grid networks and storage solutions will contribute to energy security by ensuring a stable power supply. More fundamentally, the completion of the EU-wide Energy Union, with a fully integrated and interconnected energy market, will remain crucial. Additionally, building on the commendable digitalization of public administration and the new national artificial intelligence strategy, the authorities should incentivize stronger adoption of digital technologies by the private sector to enhance productivity gains.

    Strengthening financial system resilience

    12. Monitoring of credit risks by banks should be further strengthened, while enhancing capital adequacy and its quality. With accelerating credit growth, supervisors should continue scrutinizing the extent to which banks deploy adequate and forward-looking provisioning policies, supported by adequate collateral valuations. Supervisors should also closely monitor how banks adapt their business models to the changing operating environment and further strengthen their risk management frameworks. Currently elevated bank profits should be primarily utilized to build capital buffers and improve the quality of capital. The recently announced initiative by banks to accelerate the amortization of DTCs will enhance bank resilience and reduce the bank-sovereign nexus.

    13. The implementation of the recently adopted comprehensive macroprudential toolkit will further strengthen the resilience of the banking sector. Staff welcomes activation of borrower-based measures (BBMs) for mortgage loans and a positive neutral countercyclical capital buffer (CCyB). The BBMs, in the form of caps on loan-to-value (LTV) and debt service-to-income (DSTI) ratios, should help contain excessive mortgage leverage buildup while limiting banks’ exposure to the housing boom, although close monitoring is warranted. Given the still relatively low combined capital buffers, the authorities could consider recalibrating the CCyB rate over the medium term to align with increasing uncertainty and enhance resilience.

    In closing, the mission would like to thank the Greek authorities and other stakeholders for their kind hospitality and for the open and productive discussions.

    IMF Communications Department
    MEDIA RELATIONS

    PRESS OFFICER: Eva Graf

    Phone: +1 202 623-7100Email: MEDIA@IMF.org

    MIL OSI Economics –

  • MIL-OSI: Kearny Financial Corp. Announces Second Quarter Fiscal 2025 Results and Declaration of Cash Dividend

    Source: GlobeNewswire (MIL-OSI)

    FAIRFIELD, N.J., Jan. 30, 2025 (GLOBE NEWSWIRE) — Kearny Financial Corp. (NASDAQ GS: KRNY) (the “Company”), the holding company of Kearny Bank (the “Bank”), reported net income for the quarter ended December 31, 2024 of $6.6 million, compared to $6.1 million for the quarter ended September 30, 2024.

    Earnings per basic and diluted share were $0.11 and $0.10, respectively, for the quarter ended December 31, 2024. This compares to earnings per basic and diluted share of $0.10 for the quarter ended September 30, 2024.

    The Company also announced that its Board of Directors has declared a quarterly cash dividend of $0.11 per share, payable on February 26, 2025, to stockholders of record as of February 12, 2025.

    Craig L. Montanaro, President and Chief Executive Officer, commented, “As anticipated, this quarter reflected the early stages of growth in net interest income and expansion of net interest margin. We are pleased to report growth in deposits of 3.7% from September 30, 2024, reflecting robust performance from our branch network, digital channels and commercial lending relationships. This growth allowed us to shrink the balance of outstanding borrowings while reducing our cost of funds by nine basis points quarter-over-quarter.”

    Mr. Montanaro continued, “Although market expectations for fed funds rate cuts have moderated, the continuation of positive deposit trends coupled with the reinvestment of low-coupon cash flows from our loan and securities portfolio should serve as earnings tailwinds in the coming quarters.”

    Balance Sheet

    • Total assets were $7.73 billion at December 31, 2024, a decrease of $41.0 million, or 0.5%, from September 30, 2024.
    • Investment securities totaled $1.15 billion at December 31, 2024, a decrease of $57.5 million, or 4.8%, from September 30, 2024.
    • Loans receivable totaled $5.79 billion at December 31, 2024, an increase of $7.5 million, or 0.1%, from September 30, 2024.
    • Deposits were $5.67 billion at December 31, 2024, an increase of $200.5 million, or 3.7%, from September 30, 2024. This increase was primarily driven by increases in interest and non-interest bearing demand deposits of $142.1 million, and an increase of $60.6 million in consumer savings deposits.
    • Borrowings were $1.26 billion at December 31, 2024, a decrease of $220.9 million, or 14.9%, from September 30, 2024, reflecting reductions in Federal Home Loan Bank (“FHLB”) and other borrowings.
    • At December 31, 2024, the Company maintained available secured borrowing capacity with the FHLB and the Federal Reserve Discount Window of $2.32 billion, an increase of $256.0 million from September 30, 2024, representing 30.0% of total assets.

    Earnings

    Net Interest Income and Net Interest Margin

    • Net interest margin expanded two basis points from the quarter ended September 30, 2024 to 1.82% for the quarter ended December 31, 2024. The increase for the quarter was driven by the replacement of borrowings with relatively lower cost deposits and broad based decreases in deposit rates, partially offset by higher costs and average balances of brokered certificates of deposit (“CDs”), along with reduced average balances and yields on interest-earning assets.
    • For the quarter ended December 31, 2024, net interest income increased $166,000 to $32.6 million from $32.4 million for the quarter ended September 30, 2024. Included in net interest income for the quarters ended December 31, 2024 and September 30, 2024, respectively, was purchase accounting accretion of $685,000 and $649,000, and loan prepayment penalty income of $288,000 and $52,000.

    Non-Interest Income

    • Non-interest income increased $247,000 to $4.9 million for the quarter ended December 31, 2024, from $4.6 million for the quarter ended September 30, 2024. This increase was primarily driven by a $104,000 larger gain on the sale of loans held-for-sale compared to the prior comparative period and a $102,000 increase in electronic banking fees and charges.

    Non-Interest Expense

    • For the quarter ended December 31, 2024, non-interest expense decreased $225,000, or 0.8%, to $29.6 million from $29.8 million for the quarter ended September 30, 2024. This decrease was primarily driven by a decrease in other expense, partially offset by an increase in salary and benefits expense.
    • Salary and benefits expense increased $81,000 primarily driven by the absence of a non-recurring decrease in stock-based compensation recorded in the prior comparative period, partially offset by a decrease in payroll taxes.
    • Other expense decreased $280,000 primarily driven by a reversal of $116,000 for credit losses related to off balance sheet commitments compared to a provision for credit losses on off balance sheet commitments of $274,000 recorded in the prior comparative period. The remaining changes in the other components of non-interest expense between comparative periods generally reflected normal operating fluctuations within those line items.

    Income Taxes

    • Income tax expense totaled $1.3 million for the quarter ended December 31, 2024 compared to $1.1 million for the quarter ended September 30, 2024, resulting in an effective tax rate of 16.0% and 15.1%, respectively. The increase in income tax expense was primarily due to higher pre-tax income in the current quarter.

    Asset Quality

    • The balance of non-performing assets decreased $2.2 million to $37.7 million, or 0.49% of total assets, at December 31, 2024, from $39.9 million, or 0.51% of total assets, at September 30, 2024, respectively.
    • Net charge-offs totaled $573,000, or 0.04% of average loans, on an annualized basis, for the quarter ended December 31, 2024, compared to $124,000, or 0.01% of average loans, on an annualized basis, for the quarter ended September 30, 2024. The net charge-offs recorded for the quarter ended December 31, 2024 had previously been individually reserved for within the allowance for credit losses (“ACL”).
    • For the quarter ended December 31, 2024, the Company recorded a provision for credit losses of $107,000, compared to $108,000 for the quarter ended September 30, 2024. The provision for credit loss expense for the quarter ended December 31, 2024 was primarily driven by loan growth.
    • The ACL was $44.5 million, or 0.77% of total loans, at December 31, 2024, a decrease of $466,000 from $44.9 million, or 0.78% of total loans, at September 30, 2024. The decrease in the ACL from September 30, 2024 was largely attributable to a reduction in reserves for individually evaluated loans, resulting from the charge-offs noted above.

    Capital

    • For the quarter ended December 31, 2024, book value per share decreased $0.11, or 0.9%, to $11.53 while tangible book value per share decreased $0.10, or 1.0%, to $9.75. These decreases were driven by a $7.4 million larger accumulated other comprehensive loss due primarily to a decrease in the fair value of the Company’s available for sale securities, partially offset by an increase in the fair value of the Company’s derivatives portfolio.
    • At December 31, 2024, total stockholders’ equity included after-tax net unrealized losses on securities available for sale of $89.8 million, partially offset by after-tax unrealized gains on derivatives of $17.4 million. After-tax net unrecognized losses on securities held to maturity of $11.3 million were not reflected in total stockholders’ equity.
    • At December 31, 2024, the Company’s tangible equity to tangible assets ratio equaled 8.27% and the regulatory capital ratios of both the Company and the Bank were in excess of the levels required by federal banking regulators to be classified as “well-capitalized” under regulatory guidelines.

    This earnings release should be read in conjunction with Kearny Financial Corp.’s Q2 2025 Investor Presentation, a copy of which is available through the Investor Relations link located at the bottom of the page of our website at www.kearnybank.com and via a Current Report on Form 8-K on the website of the Securities and Exchange Commission at www.sec.gov.

    Statements contained in this news release that are not historical facts are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time. The Company does not undertake and specifically disclaims any obligation to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.

    Category: Earnings

    For further information contact:
    Keith Suchodolski, Senior Executive Vice President and Chief Operating Officer, or
    Sean Byrnes, Executive Vice President and Chief Financial Officer
    Kearny Financial Corp.
    (973) 244-4500

    Linked-Quarter Comparative Financial Analysis
             
    Kearny Financial Corp.
    Consolidated Balance Sheets
    (Unaudited)
             
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		 December 31,
    2024    		 September 30,
    2024    		 Variance
    or Change    		 Variance
    or Change Pct.
    Assets        
    Cash and cash equivalents $ 141,554   $ 155,574   $ (14,020 ) -9.0 %
    Securities available for sale   1,018,279     1,070,811     (52,532 ) -4.9 %
    Securities held to maturity   127,266     132,256     (4,990 ) -3.8 %
    Loans held-for-sale   5,695     8,866     (3,171 ) -35.8 %
    Loans receivable   5,791,758     5,784,246     7,512   0.1 %
    Less: allowance for credit losses on loans   (44,457 )   (44,923 )   (466 ) -1.0 %
    Net loans receivable   5,747,301     5,739,323     7,978   0.1 %
    Premises and equipment   45,127     45,189     (62 ) -0.1 %
    Federal Home Loan Bank stock   64,443     57,706     6,737   11.7 %
    Accrued interest receivable   27,772     29,467     (1,695 ) -5.8 %
    Goodwill   113,525     113,525     —   — %
    Core deposit intangible   1,679     1,805     (126 ) -7.0 %
    Bank owned life insurance   301,339     300,186     1,153   0.4 %
    Deferred income taxes, net   53,325     50,131     3,194   6.4 %
    Other assets   84,080     67,540     16,540   24.5 %
    Total assets $ 7,731,385   $ 7,772,379   $ (40,994 ) -0.5 %
             
    Liabilities        
    Deposits:        
    Non-interest-bearing $ 601,510   $ 592,099   $ 9,411   1.6 %
    Interest-bearing   5,069,550     4,878,413     191,137   3.9 %
    Total deposits   5,671,060     5,470,512     200,548   3.7 %
    Borrowings   1,258,949     1,479,888     (220,939 ) -14.9 %
    Advance payments by borrowers for taxes   17,986     17,824     162   0.9 %
    Other liabilities   38,537     52,618     (14,081 ) -26.8 %
    Total liabilities   6,986,532     7,020,842     (34,310 ) -0.5 %
             
    Stockholders’ Equity        
    Common stock   646     646     —   — %
    Paid-in capital   494,092     493,523     569   0.1 %
    Retained earnings   342,155     342,522     (367 ) -0.1 %
    Unearned ESOP shares   (19,943 )   (20,430 )   487   2.4 %
    Accumulated other comprehensive loss   (72,097 )   (64,724 )   (7,373 ) -11.4 %
    Total stockholders’ equity   744,853     751,537     (6,684 ) -0.9 %
    Total liabilities and stockholders’ equity $ 7,731,385   $ 7,772,379   $ (40,994 ) -0.5 %
             
    Consolidated capital ratios        
    Equity to assets   9.63 %   9.67 %   -0.04 %  
    Tangible equity to tangible assets (1)   8.27 %   8.31 %   -0.04 %  
             
    Share data        
    Outstanding shares   64,580     64,580     —   — %
    Book value per share $ 11.53   $ 11.64   $ (0.11 ) -0.9 %
    Tangible book value per share (2) $ 9.75   $ 9.85   $ (0.10 ) -1.0 %

    _________________________

    (1)   Tangible equity equals total stockholders’ equity reduced by goodwill and core deposit intangible assets. Tangible assets equals total assets reduced by goodwill and core deposit intangible assets.
    (2)   Tangible book value equals total stockholders’ equity reduced by goodwill and core deposit intangible assets.

           
    Kearny Financial Corp.
    Consolidated Statements of Income
    (Unaudited)
           
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		 Three Months Ended Variance
    or Change    		 Variance
    or Change Pct.
    December 31,
    2024    		 September 30,
    2024
    Interest income        
    Loans $ 65,408   $ 66,331   $ (923 ) -1.4 %
    Taxable investment securities   13,803     14,384     (581 ) -4.0 %
    Tax-exempt investment securities   59     71     (12 ) -16.9 %
    Other interest-earning assets   2,215     2,466     (251 ) -10.2 %
    Total interest income   81,485     83,252     (1,767 ) -2.1 %
             
    Interest expense        
    Deposits   36,721     35,018     1,703   4.9 %
    Borrowings   12,152     15,788     (3,636 ) -23.0 %
    Total interest expense   48,873     50,806     (1,933 ) -3.8 %
    Net interest income   32,612     32,446     166   0.5 %
    Provision for credit losses   107     108     (1 ) -0.9 %
    Net interest income after provision for credit losses   32,505     32,338     167   0.5 %
             
    Non-interest income        
    Fees and service charges   627     635     (8 ) -1.3 %
    Gain on sale of loans   304     200     104   52.0 %
    Income from bank owned life insurance   2,619     2,567     52   2.0 %
    Electronic banking fees and charges   493     391     102   26.1 %
    Other income   830     833     (3 ) -0.4 %
    Total non-interest income   4,873     4,626     247   5.3 %
             
    Non-interest expense        
    Salaries and employee benefits   17,579     17,498     81   0.5 %
    Net occupancy expense of premises   2,831     2,798     33   1.2 %
    Equipment and systems   3,892     3,860     32   0.8 %
    Advertising and marketing   311     342     (31 ) -9.1 %
    Federal deposit insurance premium   1,503     1,563     (60 ) -3.8 %
    Directors’ compensation   361     361     —   — %
    Other expense   3,084     3,364     (280 ) -8.3 %
    Total non-interest expense   29,561     29,786     (225 ) -0.8 %
    Income before income taxes   7,817     7,178     639   8.9 %
    Income taxes   1,251     1,086     165   15.2 %
    Net income $ 6,566   $ 6,092   $ 474   7.8 %
             
    Net income per common share (EPS)        
    Basic $ 0.11   $ 0.10   $ 0.01    
    Diluted $ 0.10   $ 0.10   $ —    
             
    Dividends declared        
    Cash dividends declared per common share $ 0.11   $ 0.11   $ —    
    Cash dividends declared $ 6,933   $ 6,896   $ 37    
    Dividend payout ratio   105.6 %   113.2 %   -7.6 %  
             
    Weighted average number of common shares outstanding        
    Basic   62,443     62,389     54    
    Diluted   62,576     62,420     156    
                         
           
    Kearny Financial Corp.
    Average Balance Sheet Data
    (Unaudited)
           
    (Dollars in Thousands) Three Months Ended Variance
    or Change    		 Variance
    or Change Pct.
    December 31,
    2024    		 September 30,
    2024
    Assets        
    Interest-earning assets:        
    Loans receivable, including loans held for sale $ 5,762,053   $ 5,761,593   $ 460   — %
    Taxable investment securities   1,285,800     1,314,945     (29,145 ) -2.2 %
    Tax-exempt investment securities   9,711     12,244     (2,533 ) -20.7 %
    Other interest-earning assets   116,354     131,981     (15,627 ) -11.8 %
    Total interest-earning assets   7,173,918     7,220,763     (46,845 ) -0.6 %
    Non-interest-earning assets   459,982     467,670     (7,688 ) -1.6 %
    Total assets $ 7,633,900   $ 7,688,433   $ (54,533 ) -0.7 %
             
    Liabilities and Stockholders’ Equity        
    Interest-bearing liabilities:        
    Deposits:        
    Interest-bearing demand $ 2,314,378   $ 2,282,608   $ 31,770   1.4 %
    Savings   711,801     668,240     43,561   6.5 %
    Certificates of deposit (retail)   1,211,985     1,203,770     8,215   0.7 %
    Certificates of deposit (brokered and listing service)   735,736     551,819     183,917   33.3 %
    Total interest-bearing deposits   4,973,900     4,706,437     267,463   5.7 %
    Borrowings:        
    Federal Home Loan Bank advances   1,085,455     1,325,583     (240,128 ) -18.1 %
    Other borrowings   156,522     237,011     (80,489 ) -34.0 %
    Total borrowings   1,241,977     1,562,594     (320,617 ) -20.5 %
    Total interest-bearing liabilities   6,215,877     6,269,031     (53,154 ) -0.8 %
    Non-interest-bearing liabilities:        
    Non-interest-bearing deposits   604,915     599,095     5,820   1.0 %
    Other non-interest-bearing liabilities   65,258     69,629     (4,371 ) -6.3 %
    Total non-interest-bearing liabilities   670,173     668,724     1,449   0.2 %
    Total liabilities   6,886,050     6,937,755     (51,705 ) -0.7 %
    Stockholders’ equity   747,850     750,678     (2,828 ) -0.4 %
    Total liabilities and stockholders’ equity $ 7,633,900   $ 7,688,433   $ (54,533 ) -0.7 %
             
    Average interest-earning assets to average interest-bearing liabilities   115.41 %   115.18 %   0.23 % 0.2 %
                           
         
    Kearny Financial Corp.
    Performance Ratio Highlights
    (Unaudited)
         
      Three Months Ended Variance
    or Change
      December 31,
    2024    		 September 30,
    2024
    Average yield on interest-earning assets:      
    Loans receivable, including loans held for sale 4.54 % 4.61 % -0.07 %
    Taxable investment securities 4.29 % 4.38 % -0.09 %
    Tax-exempt investment securities (1) 2.42 % 2.32 % 0.10 %
    Other interest-earning assets 7.62 % 7.47 % 0.15 %
    Total interest-earning assets 4.54 % 4.61 % -0.07 %
           
    Average cost of interest-bearing liabilities:      
    Deposits:      
    Interest-bearing demand 2.96 % 3.13 % -0.17 %
    Savings 1.29 % 1.05 % 0.24 %
    Certificates of deposit (retail) 4.06 % 4.12 % -0.06 %
    Certificates of deposit (brokered and listing service) 2.71 % 2.18 % 0.53 %
    Total interest-bearing deposits 2.95 % 2.98 % -0.03 %
    Borrowings:      
    Federal Home Loan Bank advances 3.78 % 3.82 % -0.04 %
    Other borrowings 4.88 % 5.28 % -0.40 %
    Total borrowings 3.91 % 4.04 % -0.13 %
    Total interest-bearing liabilities 3.15 % 3.24 % -0.09 %
           
    Interest rate spread (2) 1.39 % 1.37 % 0.02 %
    Net interest margin (3) 1.82 % 1.80 % 0.02 %
           
    Non-interest income to average assets (annualized) 0.26 % 0.24 % 0.02 %
    Non-interest expense to average assets (annualized) 1.55 % 1.55 % — %
           
    Efficiency ratio (4) 78.86 % 80.35 % -1.49 %
           
    Return on average assets (annualized) 0.34 % 0.32 % 0.02 %
    Return on average equity (annualized) 3.51 % 3.25 % 0.26 %
    Return on average tangible equity (annualized) (5) 4.21 % 3.89 % 0.32 %

    _________________________

    (1)   The yield on tax-exempt investment securities has not been adjusted to reflect their tax-effective yield.
    (2)   Interest income divided by average interest-earning assets less interest expense divided by average interest-bearing liabilities.
    (3)   Net interest income divided by average interest-earning assets.
    (4)   Non-interest expense divided by the sum of net interest income and non-interest income.
    (5)   Average tangible equity equals total average stockholders’ equity reduced by average goodwill and average core deposit intangible assets.

    Five-Quarter Financial Trend Analysis
               
    Kearny Financial Corp.
    Consolidated Balance Sheets
               
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		 December 31,
    2024    		 September 30,
    2024    		 June 30,
    2024    		 March 31,
    2024    		 December 31,
    2023
      (Unaudited) (Unaudited)   (Unaudited) (Unaudited)
    Assets          
    Cash and cash equivalents $ 141,554   $ 155,574   $ 63,864   $ 71,027   $ 73,860  
    Securities available for sale   1,018,279     1,070,811     1,072,833     1,098,655     1,144,175  
    Securities held to maturity   127,266     132,256     135,742     139,643     141,959  
    Loans held-for-sale   5,695     8,866     6,036     4,117     14,030  
    Loans receivable   5,791,758     5,784,246     5,732,787     5,758,336     5,745,629  
    Less: allowance for credit losses on loans   (44,457 )   (44,923 )   (44,939 )   (44,930 )   (44,867 )
    Net loans receivable   5,747,301     5,739,323     5,687,848     5,713,406     5,700,762  
    Premises and equipment   45,127     45,189     44,940     45,053     45,928  
    Federal Home Loan Bank stock   64,443     57,706     80,300     81,347     83,372  
    Accrued interest receivable   27,772     29,467     29,521     31,065     30,258  
    Goodwill   113,525     113,525     113,525     210,895     210,895  
    Core deposit intangible   1,679     1,805     1,931     2,057     2,189  
    Bank owned life insurance   301,339     300,186     297,874     296,493     256,064  
    Deferred income taxes, net   53,325     50,131     50,339     47,225     46,116  
    Other real estate owned   —     —     —     —     11,982  
    Other assets   84,080     67,540     98,708     100,989     136,242  
    Total assets $ 7,731,385   $ 7,772,379   $ 7,683,461   $ 7,841,972   $ 7,897,832  
               
    Liabilities          
    Deposits:          
    Non-interest-bearing $ 601,510   $ 592,099   $ 598,366   $ 586,089   $ 584,130  
    Interest-bearing   5,069,550     4,878,413     4,559,757     4,622,961     4,735,500  
    Total deposits   5,671,060     5,470,512     5,158,123     5,209,050     5,319,630  
    Borrowings   1,258,949     1,479,888     1,709,789     1,722,178     1,667,055  
    Advance payments by borrowers for taxes   17,986     17,824     17,409     17,387     16,742  
    Other liabilities   38,537     52,618     44,569     44,279     46,427  
    Total liabilities   6,986,532     7,020,842     6,929,890     6,992,894     7,049,854  
               
    Stockholders’ Equity          
    Common stock   646     646     644     644     645  
    Paid-in capital   494,092     493,523     493,680     493,187     493,297  
    Retained earnings   342,155     342,522     343,326     440,308     439,755  
    Unearned ESOP shares   (19,943 )   (20,430 )   (20,916 )   (21,402 )   (21,889 )
    Accumulated other comprehensive loss   (72,097 )   (64,724 )   (63,163 )   (63,659 )   (63,830 )
    Total stockholders’ equity   744,853     751,537     753,571     849,078     847,978  
    Total liabilities and stockholders’ equity $ 7,731,385   $ 7,772,379   $ 7,683,461   $ 7,841,972   $ 7,897,832  
               
    Consolidated capital ratios          
    Equity to assets   9.63 %   9.67 %   9.81 %   10.83 %   10.74 %
    Tangible equity to tangible assets (1)   8.27 %   8.31 %   8.43 %   8.34 %   8.26 %
               
    Share data          
    Outstanding shares   64,580     64,580     64,434     64,437     64,445  
    Book value per share $ 11.53   $ 11.64   $ 11.70   $ 13.18   $ 13.16  
    Tangible book value per share (2) $ 9.75   $ 9.85   $ 9.90   $ 9.87   $ 9.85  

    _________________________

    (1)   Tangible equity equals total stockholders’ equity reduced by goodwill and core deposit intangible assets. Tangible assets equals total assets reduced by goodwill and core deposit intangible assets.
    (2)   Tangible book value equals total stockholders’ equity reduced by goodwill and core deposit intangible assets.

               
    Kearny Financial Corp.
    Supplemental Balance Sheet Highlights
    (Unaudited)
               
    (Dollars in Thousands) December 31,
    2024    		 September 30,
    2024    		 June 30,
    2024    		 March 31,
    2024    		 December 31,
    2023
    Loan portfolio composition:          
    Commercial loans:          
    Multi-family mortgage $ 2,722,623   $ 2,646,187   $ 2,645,851   $ 2,645,195   $ 2,651,274  
    Nonresidential mortgage   950,194     950,771     948,075     965,539     947,287  
    Commercial business   135,740     145,984     142,747     147,326     144,134  
    Construction   176,704     227,327     209,237     229,457     221,933  
    Total commercial loans   3,985,261     3,970,269     3,945,910     3,987,517     3,964,628  
    One- to four-family residential mortgage   1,765,160     1,768,230     1,756,051     1,741,644     1,746,065  
    Consumer loans:          
    Home equity loans   47,101     44,741     44,104     42,731     43,517  
    Other consumer   2,778     2,965     2,685     3,198     2,728  
    Total consumer loans   49,879     47,706     46,789     45,929     46,245  
    Total loans, excluding yield adjustments   5,800,300     5,786,205     5,748,750     5,775,090     5,756,938  
    Unaccreted yield adjustments   (8,542 )   (1,959 )   (15,963 )   (16,754 )   (11,309 )
    Loans receivable, net of yield adjustments   5,791,758     5,784,246     5,732,787     5,758,336     5,745,629  
    Less: allowance for credit losses on loans   (44,457 )   (44,923 )   (44,939 )   (44,930 )   (44,867 )
    Net loans receivable $ 5,747,301   $ 5,739,323   $ 5,687,848   $ 5,713,406   $ 5,700,762  
               
    Asset quality:          
    Nonperforming assets:          
    Accruing loans – 90 days and over past due $ —   $ —   $ —   $ —   $ —  
    Nonaccrual loans   37,697     39,854     39,882     39,546     28,089  
    Total nonperforming loans   37,697     39,854     39,882     39,546     28,089  
    Nonaccrual loans held-for-sale   —     —     —     —     9,700  
    Other real estate owned   —     —     —     —     11,982  
    Total nonperforming assets $ 37,697   $ 39,854   $ 39,882   $ 39,546   $ 49,771  
               
    Nonperforming loans (% total loans)   0.65 %   0.69 %   0.70 %   0.69 %   0.49 %
    Nonperforming assets (% total assets)   0.49 %   0.51 %   0.52 %   0.50 %   0.63 %
               
    Classified loans $ 132,216   $ 119,534   $ 118,700   $ 115,772   $ 94,676  
               
    Allowance for credit losses on loans (ACL):          
    ACL to total loans   0.77 %   0.78 %   0.78 %   0.78 %   0.78 %
    ACL to nonperforming loans   117.93 %   112.72 %   112.68 %   113.61 %   159.73 %
    Net charge-offs $ 573   $ 124   $ 3,518   $ 286   $ 4,110  
    Average net charge-off rate (annualized)   0.04 %   0.01 %   0.25 %   0.02 %   0.29 %
                                   
               
    Kearny Financial Corp.
    Supplemental Balance Sheet Highlights
    (Unaudited)
               
    (Dollars in Thousands) December 31,
    2024    		 September 30,
    2024    		 June 30,
    2024    		 March 31,
    2024    		 December 31,
    2023
    Funding composition:          
    Deposits:          
    Non-interest-bearing deposits $ 601,510   $ 592,099   $ 598,367   $ 586,089   $ 584,130  
    Interest-bearing demand   2,380,408     2,247,685     2,308,915     2,349,032     2,347,262  
    Savings   742,266     681,709     643,481     630,456     646,182  
    Certificates of deposit (retail)   1,194,865     1,215,746     1,199,127     1,235,261     1,283,676  
    Certificates of deposit (brokered and listing service)   752,011     733,273     408,234     408,212     458,380  
    Interest-bearing deposits   5,069,550     4,878,413     4,559,757     4,622,961     4,735,500  
    Total deposits   5,671,060     5,470,512     5,158,124     5,209,050     5,319,630  
               
    Borrowings:          
    Federal Home Loan Bank advances   1,028,949     1,209,888     1,534,789     1,457,178     1,432,055  
    Overnight borrowings   230,000     270,000     175,000     265,000     235,000  
    Total borrowings   1,258,949     1,479,888     1,709,789     1,722,178     1,667,055  
               
      Total funding $ 6,930,009   $ 6,950,400   $ 6,867,913   $ 6,931,228   $ 6,986,685  
               
    Loans as a % of deposits   101.4 %   105.1 %   110.4 %   109.8 %   107.4 %
    Deposits as a % of total funding   81.8 %   78.7 %   75.1 %   75.2 %   76.1 %
    Borrowings as a % of total funding   18.2 %   21.3 %   24.9 %   24.8 %   23.9 %
               
    Uninsured deposits:          
    Uninsured deposits (reported) (1) $ 1,935,607   $ 1,799,726   $ 1,772,623   $ 1,760,740   $ 1,813,122  
    Uninsured deposits (adjusted) (2) $ 797,721   $ 773,375   $ 764,447   $ 718,026   $ 694,510  

    _________________________

    (1)   Uninsured deposits of Kearny Bank.
    (2)   Uninsured deposits of Kearny Bank adjusted to exclude deposits of its wholly-owned subsidiary and holding company and collateralized deposits of state and local governments.

       
    Kearny Financial Corp.
    Consolidated Statements of Income (Loss)
    (Unaudited)
       
      Three Months Ended
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		 December 31,
    2024    		 September 30,
    2024    		 June 30,
    2024    		 March 31,
    2024    		 December 31,
    2023
    Interest income          
    Loans $ 65,408   $ 66,331   $ 65,819   $ 64,035   $ 63,384  
    Taxable investment securities   13,803     14,384     14,802     15,490     16,756  
    Tax-exempt investment securities   59     71     80     85     84  
    Other interest-earning assets   2,215     2,466     2,289     2,475     2,401  
    Total interest income   81,485     83,252     82,990     82,085     82,625  
               
    Interest expense          
    Deposits   36,721     35,018     32,187     32,320     30,340  
    Borrowings   12,152     15,788     17,527     15,446     16,446  
    Total interest expense   48,873     50,806     49,714     47,766     46,786  
    Net interest income   32,612     32,446     33,276     34,319     35,839  
    Provision for credit losses   107     108     3,527     349     2,105  
    Net interest income after provision for credit losses   32,505     32,338     29,749     33,970     33,734  
               
    Non-interest income          
    Fees and service charges   627     635     580     657     624  
    Loss on sale and call of securities   —     —     —     —     (18,135 )
    Gain (loss) on sale of loans   304     200     111     (712 )   104  
    Loss on sale of other real estate owned   —     —     —     —     (974 )
    Income from bank owned life insurance   2,619     2,567     3,209     3,039     1,162  
    Electronic banking fees and charges   493     391     1,130     464     396  
    Other income   830     833     776     755     811  
    Total non-interest income   4,873     4,626     5,806     4,203     (16,012 )
               
    Non-interest expense          
    Salaries and employee benefits   17,579     17,498     17,266     16,911     17,282  
    Net occupancy expense of premises   2,831     2,798     2,738     2,863     2,674  
    Equipment and systems   3,892     3,860     3,785     3,823     3,814  
    Advertising and marketing   311     342     480     387     301  
    Federal deposit insurance premium   1,503     1,563     1,532     1,429     1,495  
    Directors’ compensation   361     361     360     360     393  
    Goodwill impairment   —     —     97,370     —     —  
    Other expense   3,084     3,364     3,020     3,286     3,808  
    Total non-interest expense   29,561     29,786     126,551     29,059     29,767  
    Income (loss) before income taxes   7,817     7,178     (90,996 )   9,114     (12,045 )
    Income taxes   1,251     1,086     (917 )   1,717     1,782  
    Net income (loss) $ 6,566   $ 6,092   $ (90,079 ) $ 7,397   $ (13,827 )
               
    Net income (loss) per common share (EPS)          
    Basic $ 0.11   $ 0.10   $ (1.45 ) $ 0.12   $ (0.22 )
    Diluted $ 0.10   $ 0.10   $ (1.45 ) $ 0.12   $ (0.22 )
               
    Dividends declared          
    Cash dividends declared per common share $ 0.11   $ 0.11   $ 0.11   $ 0.11   $ 0.11  
    Cash dividends declared $ 6,933   $ 6,896   $ 6,903   $ 6,844   $ 6,882  
    Dividend payout ratio   105.6 %   113.2 %   -7.7 %   92.5 %   -49.8 %
               
    Weighted average number of common shares outstanding          
    Basic   62,443     62,389     62,254     62,205     62,299  
    Diluted   62,576     62,420     62,254     62,211     62,299  
                                   
       
    Kearny Financial Corp.
    Average Balance Sheet Data
    (Unaudited)
       
      Three Months Ended
    (Dollars in Thousands) December 31,
    2024    		 September 30,
    2024    		 June 30,
    2024    		 March 31,
    2024    		 December 31,
    2023
    Assets          
    Interest-earning assets:          
    Loans receivable, including loans held-for-sale $ 5,762,053   $ 5,761,593   $ 5,743,008   $ 5,752,477   $ 5,726,321  
    Taxable investment securities   1,285,800     1,314,945     1,343,541     1,382,064     1,509,165  
    Tax-exempt investment securities   9,711     12,244     13,737     14,614     15,025  
    Other interest-earning assets   116,354     131,981     128,257     125,155     139,740  
    Total interest-earning assets   7,173,918     7,220,763     7,228,543     7,274,310     7,390,251  
    Non-interest-earning assets   459,982     467,670     466,537     577,411     554,335  
    Total assets $ 7,633,900   $ 7,688,433   $ 7,695,080   $ 7,851,721   $ 7,944,586  
               
    Liabilities and Stockholders’ Equity          
    Interest-bearing liabilities:          
    Deposits:          
    Interest-bearing demand $ 2,314,378   $ 2,282,608   $ 2,310,521   $ 2,378,831   $ 2,301,169  
    Savings   711,801     668,240     631,622     635,226     664,926  
    Certificates of deposit (retail)   1,211,985     1,203,770     1,208,101     1,257,362     1,292,837  
    Certificates of deposit (brokered and listing service)   735,736     551,819     405,697     448,151     531,479  
    Total interest-bearing deposits   4,973,900     4,706,437     4,555,941     4,719,570     4,790,411  
    Borrowings:          
    Federal Home Loan Bank advances   1,085,455     1,325,583     1,507,192     1,428,801     1,513,497  
    Other borrowings   156,522     237,011     228,461     210,989     142,283  
    Total borrowings   1,241,977     1,562,594     1,735,653     1,639,790     1,655,780  
    Total interest-bearing liabilities   6,215,877     6,269,031     6,291,594     6,359,360     6,446,191  
    Non-interest-bearing liabilities:          
    Non-interest-bearing deposits   604,915     599,095     589,438     581,870     597,294  
    Other non-interest-bearing liabilities   65,258     69,629     62,978     65,709     62,387  
    Total non-interest-bearing liabilities   670,173     668,724     652,416     647,579     659,681  
    Total liabilities   6,886,050     6,937,755     6,944,010     7,006,939     7,105,872  
    Stockholders’ equity   747,850     750,678     751,070     844,782     838,714  
    Total liabilities and stockholders’ equity $ 7,633,900   $ 7,688,433   $ 7,695,080   $ 7,851,721   $ 7,944,586  
               
    Average interest-earning assets to average interest-bearing liabilities   115.41 %   115.18 %   114.89 %   114.39 %   114.65 %
                                   
       
    Kearny Financial Corp.
    Performance Ratio Highlights
       
      Three Months Ended
      December 31,
    2024    		 September 30,
    2024    		 June 30,
    2024    		 March 31,
    2024    		 December 31,
    2023
    Average yield on interest-earning assets:          
    Loans receivable, including loans held-for-sale 4.54 % 4.61 % 4.58 % 4.45 % 4.43 %
    Taxable investment securities 4.29 % 4.38 % 4.41 % 4.48 % 4.44 %
    Tax-exempt investment securities (1) 2.42 % 2.32 % 2.32 % 2.32 % 2.25 %
    Other interest-earning assets 7.62 % 7.47 % 7.14 % 7.91 % 6.87 %
    Total interest-earning assets 4.54 % 4.61 % 4.59 % 4.51 % 4.47 %
               
    Average cost of interest-bearing liabilities:          
    Deposits:          
    Interest-bearing demand 2.96 % 3.13 % 3.06 % 3.08 % 2.91 %
    Savings 1.29 % 1.05 % 0.63 % 0.46 % 0.44 %
    Certificates of deposit (retail) 4.06 % 4.12 % 3.95 % 3.52 % 3.06 %
    Certificates of deposit (brokered and listing service) 2.71 % 2.18 % 1.59 % 1.97 % 2.24 %
    Total interest-bearing deposits 2.95 % 2.98 % 2.83 % 2.74 % 2.53 %
    Borrowings:          
    Federal Home Loan Bank advances 3.78 % 3.82 % 3.86 % 3.55 % 3.82 %
    Other borrowings 4.88 % 5.28 % 5.24 % 5.22 % 5.65 %
    Total borrowings 3.91 % 4.04 % 4.04 % 3.77 % 3.97 %
    Total interest-bearing liabilities 3.15 % 3.24 % 3.16 % 3.00 % 2.90 %
               
    Interest rate spread (2) 1.39 % 1.37 % 1.43 % 1.51 % 1.57 %
    Net interest margin (3) 1.82 % 1.80 % 1.84 % 1.89 % 1.94 %
               
    Non-interest income to average assets (annualized) 0.26 % 0.24 % 0.30 % 0.21 % -0.81 %
    Non-interest expense to average assets (annualized) 1.55 % 1.55 % 6.58 % 1.48 % 1.50 %
               
    Efficiency ratio (4) 78.86 % 80.35 % 323.81 % 75.43 % 150.13 %
               
    Return on average assets (annualized) 0.34 % 0.32 % -4.68 % 0.38 % -0.70 %
    Return on average equity (annualized) 3.51 % 3.25 % -47.97 % 3.50 % -6.59 %
    Return on average tangible equity (annualized) (5) 4.21 % 3.89 % 3.33 % 4.68 % -8.84 %

    _________________________

    (1)   The yield on tax-exempt investment securities has not been adjusted to reflect their tax-effective yield.
    (2)   Interest income divided by average interest-earning assets less interest expense divided by average interest-bearing liabilities.
    (3)   Net interest income divided by average interest-earning assets.
    (4)   Non-interest expense divided by the sum of net interest income and non-interest income.
    (5)   Average tangible equity equals total average stockholders’ equity reduced by average goodwill and average core deposit intangible assets.

    The following tables provide a reconciliation of certain financial measures calculated in accordance with Generally Accepted Accounting Principles (“GAAP”) (as reported) and non-GAAP measures. These non-GAAP measures provide additional information which allow readers to evaluate the ongoing performance of the Company. They are not a substitute for GAAP measures; they should be read and used in conjunction with the Company’s GAAP financial information. In all cases, it should be understood that non-GAAP per share measures do not depict amounts that accrue directly to the benefit of shareholders.

       
    Kearny Financial Corp.
    Reconciliation of GAAP to Non-GAAP
    (Unaudited)
       
      Three Months Ended
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		 December 31,
    2024    		 September 30,
    2024    		 June 30,
    2024    		 March 31,
    2024    		 December 31,
    2023
    Adjusted net income:          
    Net income (loss) (GAAP) $ 6,566   $ 6,092   $ (90,079 ) $ 7,397   $ (13,827 )
    Non-recurring transactions – net of tax:          
    Net effect of sale and call of securities   —     —     —     —     12,876  
    Net effect of bank-owned life insurance restructure   —     —     392     —     6,286  
    Goodwill impairment   —     —     95,283     —     —  
    Adjusted net income $ 6,566   $ 6,092   $ 5,596   $ 7,397   $ 5,335  
               
    Calculation of pre-tax, pre-provision net revenue:          
    Net income (loss) (GAAP) $ 6,566   $ 6,092   $ (90,079 ) $ 7,397   $ (13,827 )
    Adjustments to net income (GAAP):          
    Provision for income taxes   1,251     1,086     (917 )   1,717     1,782  
    Provision for credit losses   107     108     3,527     349     2,105  
    Pre-tax, pre-provision net revenue (non-GAAP) $ 7,924   $ 7,286   $ (87,469 ) $ 9,463   $ (9,940 )
               
    Adjusted earnings per share:          
    Weighted average common shares – basic   62,443     62,389     62,254     62,205     62,299  
    Weighted average common shares – diluted   62,576     62,420     62,330     62,211     62,367  
               
    Earnings per share – basic (GAAP) $ 0.11   $ 0.10   $ (1.45 ) $ 0.12   $ (0.22 )
    Earnings per share – diluted (GAAP) $ 0.10   $ 0.10   $ (1.45 ) $ 0.12   $ (0.22 )
               
    Adjusted earnings per share – basic (non-GAAP) $ 0.11   $ 0.10   $ 0.09   $ 0.12   $ 0.09  
    Adjusted earnings per share – diluted (non-GAAP) $ 0.10   $ 0.10   $ 0.09   $ 0.12   $ 0.09  
               
    Pre-tax, pre-provision net revenue per share:          
    Pre-tax, pre-provision net revenue per share – basic (non-GAAP) $ 0.13   $ 0.12   $ (1.41 ) $ 0.15   $ (0.16 )
    Pre-tax, pre-provision net revenue per share – diluted (non-GAAP) $ 0.13   $ 0.12   $ (1.41 ) $ 0.15   $ (0.16 )
               
    Adjusted return on average assets:          
    Total average assets $ 7,633,900   $ 7,688,433   $ 7,695,080   $ 7,851,721   $ 7,944,586  
               
    Return on average assets (GAAP)   0.34 %   0.32 %   -4.68 %   0.38 %   -0.70 %
    Adjusted return on average assets (non-GAAP)   0.34 %   0.32 %   0.29 %   0.38 %   0.27 %
               
    Adjusted return on average equity:          
    Total average equity $ 747,850   $ 750,678   $ 751,070   $ 844,782   $ 838,714  
               
    Return on average equity (GAAP)   3.51 %   3.25 %   -47.97 %   3.50 %   -6.59 %
    Adjusted return on average equity (non-GAAP)   3.51 %   3.25 %   2.98 %   3.50 %   2.54 %
                                   
       
    Kearny Financial Corp.
    Reconciliation of GAAP to Non-GAAP
    (Unaudited)
       
      Three Months Ended
    (Dollars and Shares in Thousands,
    Except Per Share Data)    		 December 31,
    2024    		 September 30,
    2024    		 June 30,
    2024    		 March 31,
    2024    		 December 31,
    2023
    Adjusted return on average tangible equity:          
    Total average equity $ 747,850   $ 750,678   $ 751,070   $ 844,782   $ 838,714  
    Less: average goodwill   (113,525 )   (113,525 )   (113,525 )   (210,895 )   (210,895 )
    Less: average other intangible assets   (1,761 )   (1,886 )   (2,006 )   (2,138 )   (2,277 )
    Total average tangible equity $ 632,564   $ 635,267   $ 635,539   $ 631,749   $ 625,542  
               
    Return on average tangible equity (non-GAAP)   4.21 %   3.89 %   3.33 %   4.68 %   -8.84 %
    Adjusted return on average tangible equity (non-GAAP)   4.21 %   3.89 %   3.58 %   4.68 %   3.41 %
               
    Adjusted non-interest expense ratio:          
    Non-interest expense (GAAP) $ 29,561   $ 29,786   $ 126,551   $ 29,059   $ 29,767  
    Non-recurring transactions:          
    Goodwill impairment   —     —     (97,370 )   —     —  
    Non-interest expense (non-GAAP) $ 29,561   $ 29,786   $ 29,181   $ 29,059   $ 29,767  
               
    Non-interest expense ratio (GAAP)   1.55 %   1.55 %   6.58 %   1.48 %   1.50 %
    Adjusted non-interest expense ratio (non-GAAP)   1.55 %   1.55 %   1.52 %   1.48 %   1.50 %
               
    Adjusted efficiency ratio:          
    Non-interest expense (non-GAAP) $ 29,561   $ 29,786   $ 29,181   $ 29,059   $ 29,767  
               
    Net interest income (GAAP) $ 32,612   $ 32,446   $ 33,276   $ 34,319   $ 35,839  
    Total non-interest income (GAAP)   4,873     4,626     5,806     4,203     (16,012 )
    Non-recurring transactions:          
    Net effect of sale and call of securities   —     —     —     —     18,135  
    Net effect of bank-owned life insurance restructure   —     —     392     —     573  
    Total revenue (non-GAAP) $ 37,485   $ 37,072   $ 39,474   $ 38,522   $ 38,535  
               
    Efficiency ratio (GAAP)   78.86 %   80.35 %   323.81 %   75.43 %   150.13 %
    Adjusted efficiency ratio (non-GAAP)   78.86 %   80.35 %   73.92 %   75.43 %   77.25 %
                                   

    The MIL Network –

  • MIL-OSI: Red River Bancshares, Inc. Reports Fourth Quarter 2024 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    ALEXANDRIA, La., Jan. 30, 2025 (GLOBE NEWSWIRE) — Red River Bancshares, Inc. (the “Company”) (Nasdaq: RRBI), the holding company for Red River Bank (the “Bank”), announced today its unaudited financial results for the fourth quarter of 2024.

    Net income for the fourth quarter of 2024 was $9.3 million, or $1.37 per diluted common share (“EPS”), an increase of $552,000, or 6.3%, compared to $8.8 million, or $1.27 EPS, for the third quarter of 2024, and an increase of $1.0 million, or 12.2%, compared to $8.3 million, or $1.16 EPS, for the fourth quarter of 2023. For the fourth quarter of 2024, the quarterly return on assets was 1.18%, and the quarterly return on equity was 11.46%.

    Net income for the year ended December 31, 2024, was $34.2 million, or $4.95 EPS, a decrease of $644,000, or 1.8%, compared to $34.9 million, or $4.86 EPS, for the year ended December 31, 2023. For the year ended December 31, 2024, the return on assets was 1.11%, and the return on equity was 11.02%.

    Fourth Quarter 2024 Performance and Operational Highlights

    In the fourth quarter of 2024, the Company had an improved net interest margin, which resulted in higher net interest income and earnings, along with slightly higher loans and deposits. A significant stock repurchase transaction was completed, and a stock repurchase program for 2025 was renewed. During the fourth quarter, the target range of the federal funds rate was reduced by 50 basis points (“bps”).

    • Net income for the fourth quarter of 2024 was $9.3 million compared to $8.8 million for the prior quarter. Net income for the fourth quarter benefited from an improved net interest margin fully tax equivalent (“FTE”) and higher net interest income.
    • Net interest income and net interest margin FTE increased for the fourth quarter of 2024 compared to the prior quarter. Net interest income for the fourth quarter of 2024 was $23.7 million compared to $22.5 million for the prior quarter. Net interest margin FTE for the fourth quarter of 2024 was 3.09% compared to 2.98% for the prior quarter. These improvements were due to higher loan balances, combined with higher securities yields and lower deposit rates.
    • As of December 31, 2024, assets were $3.15 billion, which was $47.8 million, or 1.5%, higher than September 30, 2024. The increase was mainly due to a $58.0 million increase in deposits.
    • Deposits totaled $2.81 billion as of December 31, 2024, an increase of $58.0 million, or 2.1%, compared to $2.75 billion as of September 30, 2024. This increase was mainly due to the seasonal inflow of funds from public entity customers.
    • As of December 31, 2024, loans held for investment (“HFI”) were $2.08 billion, slightly higher than $2.06 billion as of September 30, 2024. In the third and fourth quarters of 2024, we closed on a high level of loan commitments, which we expect to fund over time.
    • As of December 31, 2024, total securities were $684.9 million, which was $12.8 million, or 1.8%, lower than September 30, 2024. Securities decreased mainly due to having a larger net unrealized loss on securities available-for-sale (“AFS”). New securities purchased were offset by securities maturities and principal repayments.
    • As of December 31, 2024, liquid assets, which are cash and cash equivalents, were $269.0 million, and the liquid assets to assets ratio was 8.54%. We do not have any borrowings, brokered deposits, or internet-sourced deposits.
    • In the fourth quarter of 2024, the provision for credit losses totaled $300,000. This included $200,000 for loans and $100,000 for unfunded loan commitments.
    • As of December 31, 2024, nonperforming assets (“NPA(s)”) were $3.3 million, or 0.10% of assets, and the allowance for credit losses (“ACL”) was $21.7 million, or 1.05% of loans HFI.
    • We paid a quarterly cash dividend of $0.09 per common share in the fourth quarter of 2024.
    • The 2024 stock repurchase program authorized us to purchase up to $5.0 million of our outstanding shares of common stock from January 1, 2024 through December 31, 2024. Under this plan, in the fourth quarter of 2024, we repurchased 632 shares on the open market at an aggregate cost of $33,000. The 2024 stock repurchase program expired on December 31, 2024, with $1.1 million of remaining availability. On December 19, 2024, our Board of Directors approved the renewal of our stock repurchase program for 2025. The 2025 stock repurchase program authorizes us to purchase up to $5.0 million of our outstanding shares of common stock from January 1, 2025 through December 31, 2025.
    • On November 5, 2024, we entered into a privately negotiated stock repurchase agreement for the repurchase of 50,000 shares of our common stock at a purchase price of $2.5 million. This repurchase was supplemental to our 2024 stock repurchase program.
    • In 2024, we repurchased 327,085 shares of our common stock. For the year ended December 31, 2024, these repurchases benefited earnings per share by $0.14.
    • As of December 31, 2024, capital levels were strong, with a stockholders’ equity to assets ratio of 10.15%, a leverage ratio of 11.86%, and a total risk-based capital ratio of 18.28%.
    • In the fourth quarter of 2024, we continued implementing our organic expansion plan. We purchased property in Lafayette, Louisiana and plan to build a new banking center at that location, which would be our second banking center in the Acadiana market.
    • The American Banker publication included Red River Bank in its “2024 Best Banks To Work For” ranking.

    Blake Chatelain, President and Chief Executive Officer, stated, “We are pleased to finish out 2024 with a strong fourth quarter, which included steady net interest margin improvement, higher net income, solid loan activity, and good liquidity.

    “In the fourth quarter, the Federal Reserve lowered short-term interest rates; however, longer term rates remained fairly consistent. Due to diligent balance sheet management, our net interest margin FTE increased by 11 bps and net interest income increased by 5.5% in the fourth quarter. New loan activity was very good in the fourth quarter; however, the loan portfolio was impacted by higher than normal paydowns on loans. For the second quarter in a row, we closed on a significant amount of construction loan commitments, which we expect to fund over time. Our balance sheet is well positioned for the forecasted interest rate environment and a normal shaped yield curve. This should enable us to continue improving the net interest margin slightly in the first half of 2025.

    “In the fourth quarter of 2024, we completed a third, significant private stock repurchase transaction. In 2024, we repurchased 4.6% of outstanding shares, which positively impacted earnings per share, while also maintaining strong capital levels and ratios.

    “The fourth quarter of 2024 wrapped up a good year for our Company and our communities. Our Company is well positioned for the future, with robust capital and liquidity levels combined with a great team of community bankers. We look forward to 2025 as we continue to grow and build value for our shareholders.”

    Net Interest Income and Net Interest Margin FTE

    Net interest income and net interest margin FTE increased in the fourth quarter of 2024 compared to the prior quarter. These measures were both impacted by improved yields on securities, as well as lower deposit rates. After keeping the federal funds rate consistent since the third quarter of 2023, the Federal Open Market Committee (“FOMC”) decreased the federal funds rate by 50 bps in September of 2024, and by an additional 50 bps during the fourth quarter of 2024.

    Net interest income for the fourth quarter of 2024 was $23.7 million, which was $1.2 million, or 5.5%, higher than the third quarter of 2024, due to a $729,000 increase in interest and dividend income, combined with a $501,000 decrease in interest expense. The increase in interest and dividend income was due to higher interest income on loans and securities. Loan income increased $376,000 primarily due to higher average loan balances during the fourth quarter. Securities income increased $289,000 due to reinvesting lower yielding securities cash flows into higher yielding securities. The decrease in interest expense was primarily due to lower rates on interest-bearing transaction deposits and time deposits.

    The net interest margin FTE increased 11 bps to 3.09% for the fourth quarter of 2024, compared to 2.98% for the prior quarter. This increase was due to improved yields on securities, combined with lower deposit costs. The yield on securities increased 13 bps due to reinvesting lower yielding securities cash flows into higher yielding securities. The yield on loans increased 2 bps due to higher rates on new and renewed loans compared to the existing portfolio yield. The average rate on new and renewed loans was 7.25% for the fourth quarter of 2024 and 7.89% for the prior quarter. The cost of deposits decreased 10 bps to 1.71% for the fourth quarter of 2024, compared to 1.81% for the previous quarter, due to our lowering of selected deposit rates. As a result of this change, there was a 17 bp decrease in the rate on interest-bearing transaction deposits and a 9 bp decrease on time deposits during the fourth quarter.

    The FOMC lowered the federal funds rate by 50 bps in the fourth quarter of 2024, reducing the target federal funds range to 4.25%-4.50%. The market’s expectation is that the FOMC may lower the target range of the federal funds rate by at least 25 bps in 2025. In 2025, we anticipate receiving approximately $101.0 million in securities cash flows with an average yield of 3.01%, and we project approximately $194.0 million of fixed rate loans will mature with an average yield of 6.04%. We expect to redeploy these balances into higher yielding assets. Additionally, in 2025, we expect $541.9 million of time deposits to mature with an average rate of 4.10%, which we anticipate repricing into lower cost deposits. As of December 31, 2024, floating rate loans were 16.0% of loans HFI, and floating rate transaction deposits were 8.1% of interest-bearing transaction deposits. Depending on balance sheet activity and the movement in interest rates, we expect the net interest income and net interest margin FTE to improve slightly during the first half of 2025.

    Provision for Credit Losses

    The provision for credit losses for the third and fourth quarters of 2024 was $300,000, which included $200,000 for loans and $100,000 for unfunded loan commitments for each quarter. The provision in the third and fourth quarters was due to potential economic challenges resulting from the recent inflationary environment, changing monetary policy, and loan growth. In the second half of 2024, we had an increase in unfunded loan commitments. We will continue to evaluate future provision needs in relation to current economic situations, loan growth, trends in asset quality, forecasted information, and other conditions influencing loss expectations.

    Noninterest Income

    Noninterest income totaled $5.0 million for the fourth quarter of 2024, a decrease of $424,000, or 7.8%, compared to $5.4 million for the previous quarter. The decrease was mainly due to a loss on equity securities and lower loan and deposit income.

    Equity securities are an investment in a Community Reinvestment Act (“CRA”) mutual fund consisting primarily of bonds. The gain or loss on equity securities is a fair value adjustment primarily driven by changes in the interest rate environment. Due to the fluctuations in market rates between quarters, equity securities had a loss of $91,000 in the fourth quarter of 2024, compared to a gain of $107,000 for the previous quarter.

    Loan and deposit income totaled $463,000 for the fourth quarter of 2024, a decrease of $125,000, or 21.3%, compared to $588,000 for the previous quarter. The third quarter of 2024 benefited from the receipt of a $151,000 nonrecurring loan related fee.

    Operating Expenses

    Operating expenses totaled $16.8 million for the fourth quarter of 2024, which was fairly consistent with the previous quarter. Higher occupancy and equipment expenses were offset by lower other taxes.

    Occupancy and equipment expenses totaled $1.7 million for the fourth quarter of 2024, which was $55,000, or 3.3% higher than the previous quarter. In the fourth quarter of 2024, there was $35,000 of nonrecurring expenses related to a new administrative office in the New Orleans market.

    Other taxes totaled $547,000 for the fourth quarter of 2024, a decrease of $75,000, or 12.1%, compared to $622,000 for the previous quarter. In the fourth quarter of 2024, the State of Louisiana bank stock tax expense was lower due to a $68,000 adjustment with receipt of the year-end bank stock tax invoices.

    Asset Overview

    As of December 31, 2024, assets were $3.15 billion, compared to assets of $3.10 billion as of September 30, 2024, an increase of $47.8 million, or 1.5%. In the fourth quarter, assets were mainly impacted by a $58.0 million, or 2.1%, increase in deposits. In the fourth quarter of 2024, liquid assets increased $36.3 million, or 15.6%, to $269.0 million and averaged $256.2 million for the fourth quarter. As of December 31, 2024, we had sufficient liquid assets available and $1.62 billion accessible from other liquidity sources. The liquid assets to assets ratio was 8.54% as of December 31, 2024. Total securities decreased $12.8 million, or 1.8%, to $684.9 million in the fourth quarter and were 21.7% of assets as of December 31, 2024. During the fourth quarter, loans HFI increased $19.0 million, or 0.9%, to $2.08 billion. The loans HFI to deposits ratio was 73.97% as of December 31, 2024, compared to 74.84% as of September 30, 2024.

    Securities

    Total securities as of December 31, 2024, were $684.9 million, a decrease of $12.8 million, or 1.8%, from September 30, 2024. Securities decreased mainly due to having a larger net unrealized loss on securities AFS. New securities purchased were offset by securities maturities and principal repayments.

    The estimated fair value of securities AFS totaled $550.1 million, net of $63.2 million of unrealized loss, as of December 31, 2024, compared to $560.6 million, net of $49.5 million of unrealized loss, as of September 30, 2024. As of December 31, 2024, the amortized cost of securities held-to-maturity (“HTM”) totaled $131.8 million compared to $134.1 million as of September 30, 2024. As of December 31, 2024, securities HTM had an unrealized loss of $22.8 million compared to $17.3 million as of September 30, 2024.

    As of December 31, 2024, equity securities, which is an investment in a CRA mutual fund consisting primarily of bonds, totaled $2.9 million compared to $3.0 million as of September 30, 2024.

    Loans

    Loans HFI as of December 31, 2024, were $2.08 billion, slightly higher than $2.06 billion as of September 30, 2024. In the third and fourth quarters of 2024, we closed on a high level of loan commitments, which, depending on customer activity, we expect to fund over time. Unfunded loan commitments that originated in the fourth quarter of 2024 totaled $106.2 million.

    Loans HFI by Category
      December 31, 2024   September 30, 2024   Change from
    September 30, 2024 to
    December 31, 2024
    (dollars in thousands) Amount   Percent   Amount   Percent   $ Change   % Change
    Real estate:                      
    Commercial real estate $ 884,641   42.6 %   $ 875,590   42.6 %   $ 9,051     1.0 %
    One-to-four family residential   614,551   29.6 %     616,467   30.0 %     (1,916 )   (0.3 %)
    Construction and development   155,229   7.5 %     141,525   6.9 %     13,704     9.7 %
    Commercial and industrial   327,086   15.8 %     327,069   15.9 %     17     — %
    Tax-exempt   64,930   3.1 %     66,436   3.2 %     (1,506 )   (2.3 %)
    Consumer   28,576   1.4 %     28,961   1.4 %     (385 )   (1.3 %)
    Total loans HFI $ 2,075,013   100.0 %   $ 2,056,048   100.0 %   $ 18,965     0.9 %
                                         

    Commercial real estate (“CRE”) loans are collateralized by owner occupied and non-owner occupied properties mainly in Louisiana. Non-owner occupied office loans were $56.4 million, or 2.7% of loans HFI, as of December 31, 2024, and are primarily centered in low-rise suburban areas. The average CRE loan size was $953,000 as of December 31, 2024.

    Health care loans are our largest industry concentration and are made up of a diversified portfolio of health care providers. As of December 31, 2024, total health care loans were 8.1% of loans HFI. Within the health care sector, loans to nursing and residential care facilities were 4.4% of loans HFI, and loans to physician and dental practices were 3.4% of loans HFI. The average health care loan size was $372,000 as of December 31, 2024.

    Asset Quality and Allowance for Credit Losses

    NPAs totaled $3.3 million as of December 31, 2024, an increase of $166,000, or 5.3%, from September 30, 2024, primarily due to an increase in past due loans, partially offset by payoffs and charge-offs of nonaccrual loans. The ratio of NPAs to assets was 0.10% as of December 31, 2024 and September 30, 2024.

    As of December 31, 2024, the ACL was $21.7 million. The ratio of ACL to loans HFI was 1.05% as of December 31, 2024 and 1.06% as of September 30, 2024. The net charge-offs to average loans ratio was 0.01% for the fourth quarter of 2024 and 0.00% for the third quarter of 2024.

    Deposits

    As of December 31, 2024, deposits were $2.81 billion, an increase of $58.0 million, or 2.1%, compared to September 30, 2024. Average deposits for the fourth quarter of 2024 were $2.78 billion, an increase of $53.5 million, or 2.0%, from the prior quarter. The following tables provide details on our deposit portfolio:

    Deposits by Account Type
      December 31, 2024   September 30, 2024   Change from
    September 30, 2024 to
    December 31, 2024
    (dollars in thousands) Balance   % of Total   Balance   % of Total   $ Change   % Change
    Noninterest-bearing demand deposits $ 866,496   30.9 %   $ 882,394   32.1 %   $ (15,898 )   (1.8 %)
    Interest-bearing deposits:                      
    Interest-bearing demand deposits   154,720   5.5 %     163,787   6.0 %     (9,067 )   (5.5 %)
    NOW accounts   467,118   16.7 %     379,566   13.8 %     87,552     23.1 %
    Money market accounts   556,769   19.8 %     551,229   20.0 %     5,540     1.0 %
    Savings accounts   169,894   6.1 %     166,723   6.1 %     3,171     1.9 %
    Time deposits less than or equal to $250,000   403,096   14.3 %     411,361   15.0 %     (8,265 )   (2.0 %)
    Time deposits greater than $250,000   187,013   6.7 %     192,065   7.0 %     (5,052 )   (2.6 %)
    Total interest-bearing deposits   1,938,610   69.1 %     1,864,731   67.9 %     73,879     4.0 %
    Total deposits $ 2,805,106   100.0 %   $ 2,747,125   100.0 %   $ 57,981     2.1 %
                                         
    Deposits by Customer Type
      December 31, 2024   September 30, 2024   Change from
    September 30, 2024 to
    December 31, 2024
    (dollars in thousands) Balance   % of Total   Balance   % of Total   $ Change   % Change
    Consumer $ 1,362,740   48.6 %   $ 1,348,281   49.1 %   $ 14,459     1.1 %
    Commercial   1,178,488   42.0 %     1,191,625   43.4 %     (13,137 )   (1.1 %)
    Public   263,878   9.4 %     207,219   7.5 %     56,659     27.3 %
    Total deposits $ 2,805,106   100.0 %   $ 2,747,125   100.0 %   $ 57,981     2.1 %
                                         

    The increase in deposits in the fourth quarter of 2024 was mainly due to the seasonal inflow of funds from public entity customers, partially offset by a decrease in commercial customer deposit balances related to normal business activity.

    The Bank has a granular, diverse deposit portfolio with customers in a variety of industries throughout Louisiana. As of December 31, 2024, the average deposit account size was approximately $28,000.

    As of December 31, 2024, our estimated uninsured deposits, which are the portion of deposit accounts that exceed the FDIC insurance limit (currently $250,000), were approximately $879.8 million, or 31.4% of total deposits. This amount was estimated based on the same methodologies and assumptions used for regulatory reporting purposes. Also, as of December 31, 2024, our estimated uninsured deposits, excluding collateralized public entity deposits, were approximately $667.6 million, or 23.8% of total deposits. Our cash and cash equivalents of $269.0 million, combined with our available borrowing capacity of $1.62 billion, equaled 214.6% of our estimated uninsured deposits and 282.8% of our estimated uninsured deposits, excluding collateralized public entity deposits.

    Stockholders’ Equity

    Total stockholders’ equity as of December 31, 2024, was $319.7 million compared to $324.3 million as of September 30, 2024. The $4.6 million, or 1.4%, decrease in stockholders’ equity during the fourth quarter of 2024 was attributable to a $10.6 million, net of tax, market adjustment to accumulated other comprehensive loss related to securities, the repurchase of 50,632 shares of common stock for $2.7 million, and $610,000 in cash dividends related to a $0.09 per share cash dividend that we paid on December 19, 2024. The common stock repurchase of $2.7 million includes $213,000 of stock repurchase excise tax related to our 2023 and 2024 stock repurchases, which tax regulations require to be recorded as a reduction to shareholders’ equity. These decreases in stockholders’ equity were partially offset by $9.3 million of net income and $95,000 of stock compensation.

    Non-GAAP Disclosure

    Our accounting and reporting policies conform to United States generally accepted accounting principles (“GAAP”) and the prevailing practices in the banking industry. Certain financial measures used by management to evaluate our operating performance are discussed as supplemental non-GAAP performance measures. In accordance with the Securities and Exchange Commission’s (“SEC”) rules, we classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the U.S.

    Management and the board of directors review tangible book value per share, tangible common equity to tangible assets, and realized book value per share as part of managing operating performance. However, these non-GAAP financial measures should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner we calculate the non-GAAP financial measures that are discussed may differ from that of other companies’ reporting measures with similar names. It is important to understand how such other banking organizations calculate and name their financial measures similar to the non-GAAP financial measures discussed by us when comparing such non-GAAP financial measures.

    A reconciliation of non-GAAP financial measures to the comparable GAAP financial measures is included within the following financial statement tables.

    About Red River Bancshares, Inc.

    Red River Bancshares, Inc. is the bank holding company for Red River Bank, a Louisiana state-chartered bank established in 1999 that provides a fully integrated suite of banking products and services tailored to the needs of commercial and retail customers. Red River Bank operates from a network of 28 banking centers throughout Louisiana and one combined loan and deposit production office in New Orleans, Louisiana. Banking centers are located in the following Louisiana markets: Central, which includes the Alexandria metropolitan statistical area (“MSA”); Northwest, which includes the Shreveport-Bossier City MSA; Capital, which includes the Baton Rouge MSA; Southwest, which includes the Lake Charles MSA; the Northshore, which includes Covington; Acadiana, which includes the Lafayette MSA; and New Orleans.

    Forward-Looking Statements

    Statements in this news release regarding our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business, interest rates, and markets, are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “project,” “outlook,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” The forward-looking statements in this news release are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this news release and could cause us to make changes to our future plans. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in the section titled “Risk Factors” in our most recent Annual Report on Form 10-K and any subsequent quarterly reports on Form 10-Q, and in other documents that we file with the SEC from time to time. In addition, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this news release or to make predictions based solely on historical financial performance. Any forward-looking statement speaks only as of the date on which it is made, and we do not undertake any obligation to update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. All forward-looking statements, express or implied, included in this news release are qualified in their entirety by this cautionary statement.

    Contact:
    Isabel V. Carriere, CPA, CGMA
    Executive Vice President, Chief Financial Officer, and Assistant Corporate Secretary
    318-561-4023
    icarriere@redriverbank.net 

    FINANCIAL HIGHLIGHTS (UNAUDITED)
     
        As of and for the
    Three Months Ended    		   As of and for the
    Years Ended
    (dollars in thousands, except per share data)   December 31,
    2024    		   September 30,
    2024    		   December 31,
    2023    		   December 31,
    2024    		   December 31,
    2023
    Net Income   $ 9,306     $ 8,754     $ 8,292     $ 34,235     $ 34,879  
                         
    Per Common Share Data:                    
    Earnings per share, basic   $ 1.37     $ 1.28     $ 1.16     $ 4.96     $ 4.87  
    Earnings per share, diluted   $ 1.37     $ 1.27     $ 1.16     $ 4.95     $ 4.86  
    Book value per share   $ 47.18     $ 47.51     $ 42.85     $ 47.18     $ 42.85  
    Tangible book value per share (1)   $ 46.95     $ 47.28     $ 42.63     $ 46.95     $ 42.63  
    Realized book value per share (1)   $ 56.07     $ 54.78     $ 51.38     $ 56.07     $ 51.38  
    Cash dividends per share   $ 0.09     $ 0.09     $ 0.08     $ 0.36     $ 0.32  
    Shares outstanding     6,777,238       6,826,120       7,091,637       6,777,238       7,091,637  
    Weighted average shares outstanding, basic     6,797,469       6,851,223       7,128,988       6,898,286       7,164,314  
    Weighted average shares outstanding, diluted     6,816,299       6,867,474       7,145,870       6,918,060       7,181,728  
                         
    Summary Performance Ratios:                    
    Return on average assets     1.18 %     1.13 %     1.08 %     1.11 %     1.15 %
    Return on average equity     11.46 %     11.11 %     11.63 %     11.02 %     12.44 %
    Net interest margin     3.04 %     2.93 %     2.78 %     2.91 %     2.87 %
    Net interest margin FTE     3.09 %     2.98 %     2.82 %     2.96 %     2.91 %
    Efficiency ratio     58.71 %     60.09 %     60.51 %     60.29 %     59.39 %
    Loans HFI to deposits ratio     73.97 %     74.84 %     71.13 %     73.97 %     71.13 %
    Noninterest-bearing deposits to deposits ratio     30.89 %     32.12 %     32.71 %     30.89 %     32.71 %
    Noninterest income to average assets     0.63 %     0.70 %     0.67 %     0.66 %     0.70 %
    Operating expense to average assets     2.14 %     2.17 %     2.08 %     2.14 %     2.11 %
                         
    Summary Credit Quality Ratios:                    
    NPAs to assets     0.10 %     0.10 %     0.08 %     0.10 %     0.08 %
    Nonperforming loans to loans HFI     0.16 %     0.15 %     0.13 %     0.16 %     0.13 %
    ACL to loans HFI     1.05 %     1.06 %     1.07 %     1.05 %     1.07 %
    Net charge-offs to average loans     0.01 %     0.00 %     0.01 %     0.03 %     0.02 %
                         
    Capital Ratios:                    
    Stockholders’ equity to assets     10.15 %     10.46 %     9.71 %     10.15 %     9.71 %
    Tangible common equity to tangible assets(1)     10.11 %     10.41 %     9.67 %     10.11 %     9.67 %
    Total risk-based capital to risk-weighted assets     18.28 %     18.07 %     18.28 %     18.28 %     18.28 %
    Tier 1 risk-based capital to risk-weighted assets     17.12 %     17.05 %     17.24 %     17.12 %     17.24 %
    Common equity Tier 1 capital to risk-weighted assets     17.12 %     17.05 %     17.24 %     17.12 %     17.24 %
    Tier 1 risk-based capital to average assets     11.86 %     11.90 %     11.56 %     11.86 %     11.56 %

    (1) Non-GAAP financial measure. Calculations of this measure and reconciliations to GAAP are included in the schedules accompanying this release.

    RED RIVER BANCSHARES, INC.
    CONSOLIDATED BALANCE SHEETS (UNAUDITED)
     
    (in thousands) December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023
    ASSETS                  
    Cash and due from banks $ 30,558     $ 39,664     $ 35,035     $ 19,401     $ 53,062  
    Interest-bearing deposits in other banks   238,417       192,983       178,038       210,404       252,364  
    Securities available-for-sale, at fair value   550,148       560,555       526,890       545,967       570,092  
    Securities held-to-maturity, at amortized cost   131,796       134,145       136,824       139,328       141,236  
    Equity securities, at fair value   2,937       3,028       2,921       2,934       2,965  
    Nonmarketable equity securities   2,328       2,305       2,283       2,261       2,239  
    Loans held for sale   2,547       1,805       3,878       1,653       1,306  
    Loans held for investment   2,075,013       2,056,048       2,047,890       2,038,072       1,992,858  
    Allowance for credit losses   (21,731 )     (21,757 )     (21,627 )     (21,564 )     (21,336 )
    Premises and equipment, net   59,441       57,661       57,910       57,539       57,088  
    Accrued interest receivable   10,048       9,465       9,570       9,995       9,945  
    Bank-owned life insurance   30,380       30,164       29,947       29,731       29,529  
    Intangible assets   1,546       1,546       1,546       1,546       1,546  
    Right-of-use assets   2,733       2,853       2,973       3,091       3,629  
    Other assets   33,433       31,285       34,450       32,940       32,287  
    Total Assets $ 3,149,594     $ 3,101,750     $ 3,048,528     $ 3,073,298     $ 3,128,810  
    LIABILITIES                  
    Noninterest-bearing deposits $ 866,496     $ 882,394     $ 892,942     $ 895,439     $ 916,456  
    Interest-bearing deposits   1,938,610       1,864,731       1,823,704       1,850,452       1,885,432  
    Total Deposits   2,805,106       2,747,125       2,716,646       2,745,891       2,801,888  
    Accrued interest payable   7,583       11,751       8,747       8,959       8,000  
    Lease liabilities   2,864       2,982       3,100       3,215       3,767  
    Accrued expenses and other liabilities   14,302       15,574       13,045       15,919       11,304  
    Total Liabilities   2,829,855       2,777,432       2,741,538       2,773,984       2,824,959  
    COMMITMENTS AND CONTINGENCIES   —       —       —       —       —  
    STOCKHOLDERS’ EQUITY                  
    Preferred stock, no par value   —       —       —       —       —  
    Common stock, no par value   38,655       41,402       44,413       45,177       55,136  
    Additional paid-in capital   2,777       2,682       2,590       2,485       2,407  
    Retained earnings   338,554       329,858       321,719       314,352       306,802  
    Accumulated other comprehensive income (loss)   (60,247 )     (49,624 )     (61,732 )     (62,700 )     (60,494 )
    Total Stockholders’ Equity   319,739       324,318       306,990       299,314       303,851  
    Total Liabilities and Stockholders’ Equity $ 3,149,594     $ 3,101,750     $ 3,048,528     $ 3,073,298     $ 3,128,810  
    RED RIVER BANCSHARES, INC.
    CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
                         
        For the Three Months Ended   For the Years Ended
    (in thousands)     December 31,
    2024    		       September 30,
    2024    		     December 31,
    2023    		     December 31,
    2024    		       December 31,
    2023    		  
    INTEREST AND DIVIDEND INCOME                                    
    Interest and fees on loans   $ 28,285     $ 27,909   $ 24,898   $ 108,969     $ 93,439  
    Interest on securities     4,623       4,334     3,656     17,089       14,291  
    Interest on federal funds sold     —       —     —     —       886  
    Interest on deposits in other banks     2,699       2,630     3,438     11,077       9,797  
    Dividends on stock     23       28     49     95       155  
    Total Interest and Dividend Income     35,630       34,901     32,041     137,230       118,568  
    INTEREST EXPENSE                    
    Interest on deposits     11,943       12,444     10,747     47,936       32,066  
    Interest on other borrowed funds     —       —     —     —       64  
    Total Interest Expense     11,943       12,444     10,747     47,936       32,130  
    Net Interest Income     23,687       22,457     21,294     89,294       86,438  
    Provision for credit losses     300       300     250     1,200       735  
    Net Interest Income After Provision for Credit Losses     23,387       22,157     21,044     88,094       85,703  
    NONINTEREST INCOME                    
    Service charges on deposit accounts     1,452       1,486     1,459     5,674       5,776  
    Debit card income, net     960       905     875     3,836       3,563  
    Mortgage loan income     652       732     441     2,490       1,965  
    Brokerage income     924       987     1,039     3,791       3,798  
    Loan and deposit income     463       588     575     2,034       2,140  
    Bank-owned life insurance income     216       217     197     851       754  
    Gain (Loss) on equity securities     (91 )     107     132     (28 )     (14 )
    SBIC income     346       301     393     1,453       2,873  
    Other income (loss)     73       96     76     340       259  
    Total Noninterest Income     4,995       5,419     5,187     20,441       21,114  
    OPERATING EXPENSES                    
    Personnel expenses     9,769       9,700     9,233     38,623       37,241  
    Occupancy and equipment expenses     1,716       1,661     1,647     6,691       6,581  
    Technology expenses     884       865     693     3,182       2,759  
    Advertising     313       317     347     1,374       1,302  
    Other business development expenses     486       521     537     2,076       1,987  
    Data processing expense     681       652     631     2,331       2,320  
    Other taxes     547       622     679     2,407       2,721  
    Loan and deposit expenses     334       294     256     895       984  
    Legal and professional expenses     658       653     664     2,657       2,378  
    Regulatory assessment expenses     428       421     423     1,654       1,645  
    Other operating expenses     1,024       1,046     913     4,264       3,955  
    Total Operating Expenses     16,840       16,752     16,023     66,154       63,873  
    Income Before Income Tax Expense     11,542       10,824     10,208     42,381       42,944  
    Income tax expense     2,236       2,070     1,916     8,146       8,065  
    Net Income   $ 9,306     $ 8,754   $ 8,292   $ 34,235     $ 34,879  
                                         
    RED RIVER BANCSHARES, INC.
    NET INTEREST INCOME AND NET INTEREST MARGIN (UNAUDITED)
     
      For the Three Months Ended
      December 31, 2024   September 30, 2024
    (dollars in thousands) Average Balance Outstanding   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate    		   Average Balance Outstanding   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate
    Assets                      
    Interest-earning assets:                      
    Loans(1,2) $ 2,072,858     $ 28,285   5.34 %   $ 2,054,451     $ 27,909   5.32 %
    Securities – taxable   555,622       3,636   2.62 %     545,171       3,344   2.45 %
    Securities – tax-exempt   190,470       987   2.07 %     191,285       990   2.07 %
    Interest-bearing deposits in other banks   225,660       2,699   4.74 %     194,229       2,630   5.36 %
    Nonmarketable equity securities   2,307       23   3.99 %     2,284       28   4.85 %
    Total interest-earning assets   3,046,917     $ 35,630   4.60 %     2,987,420     $ 34,901   4.59 %
    Allowance for credit losses   (21,824 )             (21,702 )        
    Noninterest-earning assets   109,992               104,599          
    Total assets $ 3,135,085             $ 3,070,317          
    Liabilities and Stockholders’ Equity                      
    Interest-bearing liabilities:                      
    Interest-bearing transaction deposits $ 1,263,775     $ 5,658   1.78 %   $ 1,230,487     $ 6,042   1.95 %
    Time deposits   599,910       6,285   4.17 %     597,286       6,402   4.26 %
    Total interest-bearing deposits   1,863,685       11,943   2.55 %     1,827,773       12,444   2.71 %
    Other borrowings   —       —   — %     —       —   — %
    Total interest-bearing liabilities   1,863,685     $ 11,943   2.55 %     1,827,773     $ 12,444   2.71 %
    Noninterest-bearing liabilities:                      
    Noninterest-bearing deposits   918,804               901,192          
    Accrued interest and other liabilities   29,567               28,006          
    Total noninterest-bearing liabilities   948,371               929,198          
    Stockholders’ equity   323,029               313,346          
    Total liabilities and stockholders’ equity $ 3,135,085             $ 3,070,317          
    Net interest income     $ 23,687           $ 22,457    
    Net interest spread         2.05 %           1.88 %
    Net interest margin         3.04 %           2.93 %
    Net interest margin FTE(3)         3.09 %           2.98 %
    Cost of deposits         1.71 %           1.81 %
    Cost of funds         1.56 %           1.66 %

    (1) Includes average outstanding balances of loans held for sale of $3.2 million and $3.0 million for the three months ended December 31, 2024 and September 30, 2024, respectively.
    (2) Nonaccrual loans are included as loans carrying a zero yield.
    (3) Net interest margin FTE includes an FTE adjustment using a 21.0% federal income tax rate on tax-exempt securities and tax-exempt loans.

    RED RIVER BANCSHARES, INC.
    NET INTEREST INCOME AND NET INTEREST MARGIN (UNAUDITED)
     
      For the Years Ended
      December 31, 2024   December 31, 2023
    (dollars in thousands) Average Balance Outstanding   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate    		   Average Balance Outstanding   Interest
    Income/
    Expense    		   Average
    Yield/
    Rate
    Assets                      
    Interest-earning assets:                      
    Loans(1,2) $ 2,046,339     $ 108,969   5.24 %   $ 1,943,381     $ 93,439   4.74 %
    Securities – taxable   554,194       13,098   2.36 %     605,692       10,169   1.68 %
    Securities – tax-exempt   193,368       3,991   2.06 %     202,673       4,122   2.03 %
    Federal funds sold   —       —   — %     18,594       886   4.70 %
    Interest-bearing deposits in other banks   210,959       11,077   5.22 %     188,199       9,797   5.17 %
    Nonmarketable equity securities   2,273       95   4.19 %     3,353       155   4.61 %
    Total interest-earning assets   3,007,133     $ 137,230   4.50 %     2,961,892     $ 118,568   3.96 %
    Allowance for credit losses   (21,646 )             (20,980 )        
    Noninterest-earning assets   102,951               86,939          
    Total assets $ 3,088,438             $ 3,027,851          
    Liabilities and Stockholders’ Equity                      
    Interest-bearing liabilities:                      
    Interest-bearing transaction deposits $ 1,246,528     $ 23,082   1.85 %   $ 1,249,259     $ 17,555   1.41 %
    Time deposits   593,817       24,854   4.19 %     470,522       14,511   3.08 %
    Total interest-bearing deposits   1,840,345       47,936   2.60 %     1,719,781       32,066   1.86 %
    Other borrowings   —       —   — %     1,151       64   5.49 %
    Total interest-bearing liabilities   1,840,345     $ 47,936   2.60 %     1,720,932     $ 32,130   1.87 %
    Noninterest-bearing liabilities:                      
    Noninterest-bearing deposits   910,507               1,004,107          
    Accrued interest and other liabilities   26,884               22,385          
    Total noninterest-bearing liabilities   937,391               1,026,492          
    Stockholders’ equity   310,702               280,427          
    Total liabilities and stockholders’ equity $ 3,088,438             $ 3,027,851          
    Net interest income     $ 89,294           $ 86,438    
    Net interest spread         1.90 %           2.09 %
    Net interest margin         2.91 %           2.87 %
    Net interest margin FTE(3)         2.96 %           2.91 %
    Cost of deposits         1.74 %           1.18 %
    Cost of funds         1.59 %           1.08 %

    (1) Includes average outstanding balances of loans held for sale of $2.9 million and $2.4 million for the years ended December 31, 2024 and 2023, respectively.
    (2) Nonaccrual loans are included as loans carrying a zero yield.
    (3) Net interest margin FTE includes an FTE adjustment using a 21.0% federal income tax rate on tax-exempt securities and tax-exempt loans.

    RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED)
     
    (dollars in thousands, except per share data) December 31,
    2024    		   September 30,
    2024    		   December 31,
    2023
    Tangible common equity          
    Total stockholders’ equity $ 319,739     $ 324,318     $ 303,851  
    Adjustments:          
    Intangible assets   (1,546 )     (1,546 )     (1,546 )
    Total tangible common equity (non-GAAP) $ 318,193     $ 322,772     $ 302,305  
    Realized common equity          
    Total stockholders’ equity $ 319,739     $ 324,318     $ 303,851  
    Adjustments:          
    Accumulated other comprehensive (income) loss   60,247       49,624       60,494  
    Total realized common equity (non-GAAP) $ 379,986     $ 373,942     $ 364,345  
    Common shares outstanding   6,777,238       6,826,120       7,091,637  
    Book value per share $ 47.18     $ 47.51     $ 42.85  
    Tangible book value per share (non-GAAP) $ 46.95     $ 47.28     $ 42.63  
    Realized book value per share (non-GAAP) $ 56.07     $ 54.78     $ 51.38  
               
    Tangible assets          
    Total assets $ 3,149,594     $ 3,101,750     $ 3,128,810  
    Adjustments:          
    Intangible assets   (1,546 )     (1,546 )     (1,546 )
    Total tangible assets (non-GAAP) $ 3,148,048     $ 3,100,204     $ 3,127,264  
    Total stockholders’ equity to assets   10.15 %     10.46 %     9.71 %
    Tangible common equity to tangible assets (non-GAAP)   10.11 %     10.41 %     9.67 %

    The MIL Network –

  • MIL-OSI: iPower Schedules Fiscal Second Quarter 2025 Conference Call for February 13, 2025 at 4:30 p.m. ET

    Source: GlobeNewswire (MIL-OSI)

    RANCHO CUCAMONGA, Calif., Jan. 30, 2025 (GLOBE NEWSWIRE) — iPower Inc. (Nasdaq: IPW) (“iPower” or the “Company”), a tech and data-driven ecommerce services provider and online retailer, will host a conference call on Thursday, February 13, 2025 at 4:30 p.m. Eastern time to discuss its financial results for the fiscal second quarter ended December 31, 2024. The Company’s results will be reported in a press release prior to the call.

    iPower management will host the conference call, followed by a question-and-answer period.

    Date: Thursday, February 13, 2025
    Time: 4:30 p.m. Eastern time
    Dial-in registration link: here
    Live webcast registration link: here

    Please dial into the conference call 5-10 minutes prior to the start time. If you have any difficulty connecting with the conference call, please contact the company’s investor relations team at IPW@elevate-ir.com.

    The conference call will also be broadcast live and available for replay in the Events & Presentations section of the Company’s website at www.meetipower.com.

    About iPower Inc. 

    iPower Inc. is a tech and data-driven online retailer, as well as a provider of value-added ecommerce services for third-party products and brands. iPower’s capabilities include a full spectrum of online channels, robust fulfillment capacity, a nationwide network of warehouses, competitive last mile delivery partners and a differentiated business intelligence platform. iPower believes that these capabilities will enable it to efficiently move a diverse catalog of SKUs from its supply chain partners to end consumers every day, providing the best value to customers in the U.S. and other countries. For more information, please visit iPower’s website at www.meetipower.com.

    Forward Looking Statements

    This press release may contain information about iPower’s view of its future expectations, plans and prospects that constitute forward-looking statements. Actual results may differ materially from historical results or those indicated by these forward-looking statements because of a variety of factors including, but not limited to, risks and uncertainties associated with its ability to maintain and grow its business, variability of operating results, its development and introduction of new products and services, marketing and other business development initiatives and competition in the industry. iPower encourages you to review other factors that may affect its future results in its filings with the SEC.

    Investor Relations Contact

    Sean Mansouri, CFA or Aaron D’Souza
    Elevate IR
    (720) 330-2829
    IPW@elevate-ir.com

    The MIL Network –

  • MIL-OSI Russia: Greece: Staff Concluding Statement of the 2025 Article IV Consultation Mission

    Source: IMF – News in Russian

    January 30, 2025

    A Concluding Statement describes the preliminary findings of IMF staff at the end of an official staff visit (or ‘mission’), in most cases to a member country. Missions are undertaken as part of regular (usually annual) consultations under Article IV of the IMF’s Articles of Agreement, in the context of a request to use IMF resources (borrow from the IMF), as part of discussions of staff monitored programs, or as part of other staff monitoring of economic developments.

    The authorities have consented to the publication of this statement. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Based on the preliminary findings of this mission, staff will prepare a report that, subject to management approval, will be presented to the IMF Executive Board for discussion and decision.

    Greece’s near-term economic outlook remains favorable, with real GDP sustaining its robust expansion. The public finances have further improved, with the public debt-to-GDP ratio on a firm downward trajectory, amid continued fiscal consolidation supported by strong progress in reducing tax evasion. Continuing the reform momentum will establish a solid foundation to address remaining crisis legacies and structural challenges arising from the rising yet still low level of overall investment, an unfavorable demographic outlook, and sluggish productivity growth. The right policy mix aimed at continuing fiscal consolidation in a growth-friendly manner, implementing ambitious reforms to address supply-side structural impediments, and further strengthening financial system resilience is essential to achieve sustainable growth in the medium to long term, while ensuring fiscal sustainability and safeguarding financial stability.

    Robust Expansion with Declining Debt

    1. The economy maintained its robust growth in 2024, supported by strong domestic demand. Real GDP expanded by 2.3 percent (year-on-year; y/y) in the first three quarters, buoyed by a strong pickup in NGEU-funded investment projects and robust private consumption underpinned by rising real income. The unemployment rate fell to 9.5 percent (seasonally adjusted) in 2024Q3, a historic low since 2009, and the vacancy rate has risen, reflecting labor shortages in a few sectors, particularly construction, tourism-related services, and high-skill sectors. The labor force participation rate has also gradually risen but remains among the lowest in EU, especially for women. Disinflation is underway at a gradual pace with headline and core inflation at 2.9 and 3.4 percent (y/y) in end-2024, respectively, amid persistent services inflation and wage growth. Along with strong economic activity, credit growth to the private sector has accelerated to 9.4 percent (y/y) in 2024Q4, accompanied by a continued increase in residential real estate prices. High domestic import demand, driven by investment, also contributed to the widening of the current account deficit to an estimated 6.9 percent of GDP in 2024.

    2. Continued fiscal consolidation and sustained progress in much-needed structural reforms have strengthened the public finances, growth potential, and energy security. By end-2024, the public debt-to-GDP ratio is estimated to have decreased by more than 50 percentage points from its peak in 2020, supported by strong growth, high inflation, and substantial fiscal consolidation. While the labor tax wedge has been reduced by about 4½ percentage points since 2019, tax revenue has remained buoyant due to the authorities’ strong progress in reducing tax evasion. The abolishment of substantial pension penalties for retirees re-entering the labor market significantly increased the number of working pensioners in 2024. Following the significant expansion of solar and wind capacity in recent years, renewable sources now account for about 50 percent of total electricity generation.

    3. The banking system has further enhanced its resilience with improved asset quality and capital adequacy. Asset quality in systemically important banks has improved further, with the NPL ratio dropping to around 3 percent in 2024Q3, facilitated by a government-sponsored securitization framework. Banks sustained high profits, which, along with capital instrument issuances, have boosted capital adequacy, although there is room for a further strengthening of voluntary capital buffers. The capital quality needs to be further improved as Deferred Tax Credit (DTC) still represents a substantial share of prudential capital. Given repayment of the Targeted Longer-Term Refinancing Operations (TLTROs) and meeting the Minimum Requirement for Own Funds and Eligible Liabilities (MREL) targets, liquidity and funding risks have been markedly reduced, with buffers well above prudential requirements and the EU average.

    4. Real GDP growth is projected to remain high at 2.1 percent in 2025, before moderating in the medium term. Investment will continue to be a key driver, supported by NGEU-funded projects. Private consumption growth will remain solid, underpinned by favorable employment and income growth. With stabilizing global energy prices, headline inflation is expected to resume its downward trend, while core inflation will be more persistent due to services inflation and wage growth. With NGEU funding set to expire against the backdrop of demographic headwinds and sluggish productivity growth, GDP growth is forecast to moderate to lower levels around 1¼ percent in the medium term. The current account deficit is expected to narrow gradually below 4 percent of GDP in the medium term, as imports are expected to slow along with the winding down of NGEU-funded investment.

    5. Risks to the growth outlook are balanced, while those to inflation are tilted upward. Potential headwinds include the growth slowdown in major euro area countries, a deterioration of regional conflicts, and global policy uncertainty. The acceleration of ambitious structural reforms could further improve growth prospects. Stronger and more persistent-than-expected wage growth could further fuel services inflation, potentially exacerbated by fluctuations in global and regional energy prices.

    Growth-friendly Fiscal Consolidation

    6. Continued fiscal consolidation would further strengthen public debt sustainability. The primary surplus is expected to remain high at around 2½ percent of GDP in 2025 as reduced revenue from an additional cut in social security contributions is expected to be broadly offset by revenue gains from reforms aimed at reducing tax evasion and increasing tax compliance. With the primary surplus remaining high at 2.3 percent of GDP in the medium term, the public debt-to-GDP ratio is projected to decrease further by about 25 percentage points to below 130 percent by 2030.

    7. Additional expenditure measures that raise efficiency would further strengthen Greece’s public finances. Continued reforms are necessary to enhance efficient public investment planning and management, including through further strengthening centralized coordination and procurement. It is essential to protect non-pension social spending, such as healthcare and education, to promote inclusive growth, while enhancing efficiency. Excessive increases in pensions and public-sector wages should be resisted by implementing recent reforms, for example by ensuring that pension increases adhere to the established indexation formula without ad hoc adjustment.

    8. There is room for additional revenue-enhancing reforms to further reduce tax evasion while enhancing the progressivity of the tax system. The Independent Authority for Public Revenue’s new medium-term strategy presents a good opportunity to further modernize tax administration and increase tax collection by continuing to leverage digitalization, which also reduces the burden of compliance. Tax policy reforms should focus on broadening the tax base and increasing tax progressivity. Additionally, inefficient tax expenditures, particularly the regressive VAT exemptions on some goods and services, should be phased out. The authorities should also consider raising carbon pricing, particularly in the transport and industry sectors, which can generate revenue for improved social protection and help address climate change and energy security by sharpening market incentives.

    9. Fiscal space created by additional measures or better-than-expected performance should be used for debt reduction as well as crucial social and capital spending. While public debt remains high, there are significant infrastructure investment needs, especially for energy security and in support of the green transition. The authorities should also consider enhancing support for crucial social expenditures, such as healthcare, and education with increased targeting toward the poor and vulnerable to promote inclusive growth.

    Structural reforms for boosting potential growth

    10. Comprehensive reforms to address structural supply-side impediments would increase productivity and medium-term growth prospects.

    • Raising labor force participation and ensuring a better skilled workforce. Increasing the availability of childcare and elderly care facilities can enable women to engage more productively in the economy. Reducing the still high tax wedge, coupled with appropriate job search and phasing out certain features of the unemployment benefit within the eligibility period, can enhance work incentives. Upgrading and scaling up the lifelong learning system with effective private sector participation, particularly in digital and green skills, as well as healthcare, can reduce skill mismatches and help alleviate bottlenecks for youth and female employment.
    • Accelerating regulatory reforms. Further reducing the regulatory burden and barriers to entry for firms, particularly in the services sector, would foster competition, increase productivity, and promote investment. Promoting business dynamism and fostering robust job creation are essential for effectively integrating new labor force entrants, particularly women, into employment. The quality of regulation needs to be improved by leveraging digitalization and enhancing regulatory impact assessments. Further enlarging and deepening the European single market would allow firms to grow to scale and lift productivity.
    • Advancing judicial system reforms. Progress in the implementation of the new insolvency framework, which is essential for addressing a large stock of crisis legacy distressed debt, has been hindered by imbalances and rigidities in the functioning of the civil judiciary system. In line with the recent judicial reform program, efforts should focus on accelerating the resolution of court cases. Such reforms would not only enhance financial sector resilience but also promote productive growth by facilitating the reallocation of capital to more productive activities and higher investment.

    11. Continued progress in green and digital transition will help achieve energy security and further boost productivity growth. Improving power connectivity with distant islands and enhancing energy efficiency in industries and transportation are essential for achieving the updated climate goals. Building on the ongoing increase in solar and wind capacity, scaling up grid networks and storage solutions will contribute to energy security by ensuring a stable power supply. More fundamentally, the completion of the EU-wide Energy Union, with a fully integrated and interconnected energy market, will remain crucial. Additionally, building on the commendable digitalization of public administration and the new national artificial intelligence strategy, the authorities should incentivize stronger adoption of digital technologies by the private sector to enhance productivity gains.

    Strengthening financial system resilience

    12. Monitoring of credit risks by banks should be further strengthened, while enhancing capital adequacy and its quality. With accelerating credit growth, supervisors should continue scrutinizing the extent to which banks deploy adequate and forward-looking provisioning policies, supported by adequate collateral valuations. Supervisors should also closely monitor how banks adapt their business models to the changing operating environment and further strengthen their risk management frameworks. Currently elevated bank profits should be primarily utilized to build capital buffers and improve the quality of capital. The recently announced initiative by banks to accelerate the amortization of DTCs will enhance bank resilience and reduce the bank-sovereign nexus.

    13. The implementation of the recently adopted comprehensive macroprudential toolkit will further strengthen the resilience of the banking sector. Staff welcomes activation of borrower-based measures (BBMs) for mortgage loans and a positive neutral countercyclical capital buffer (CCyB). The BBMs, in the form of caps on loan-to-value (LTV) and debt service-to-income (DSTI) ratios, should help contain excessive mortgage leverage buildup while limiting banks’ exposure to the housing boom, although close monitoring is warranted. Given the still relatively low combined capital buffers, the authorities could consider recalibrating the CCyB rate over the medium term to align with increasing uncertainty and enhance resilience.

    In closing, the mission would like to thank the Greek authorities and other stakeholders for their kind hospitality and for the open and productive discussions.

    IMF Communications Department
    MEDIA RELATIONS

    PRESS OFFICER: Eva Graf

    Phone: +1 202 623-7100Email: MEDIA@IMF.org

    https://www.imf.org/en/News/Articles/2025/01/30/CS-Greece-2025

    MIL OSI

    MIL OSI Russia News –

  • MIL-OSI USA: RELEASE: DCCA URGES RESIDENTS AND BUSINESSES TO PRIORITIZE EMERGENCY PREPAREDNESS AMID INCREASING WEATHER EVENTS

    Source: US State of Hawaii

    RELEASE: DCCA URGES RESIDENTS AND BUSINESSES TO PRIORITIZE EMERGENCY PREPAREDNESS AMID INCREASING WEATHER EVENTS

    Posted on Jan 29, 2025 in Latest Department News, Newsroom

     

    STATE OF HAWAIʻI

    KA MOKU ʻĀINA O HAWAIʻI

     

    DEPARTMENT OF COMMERCE AND CONSUMER AFFAIRS

    KA ʻOIHANA PILI KĀLEPA

     

    JOSH GREEN, M.D.

    GOVERNOR

    KE KIAʻĀINA

     

    NADINE Y. ANDO

    DIRECTOR

    KA LUNA HOʻOKELE

    DCCA URGES RESIDENTS AND BUSINESSES TO PRIORITIZE EMERGENCY PREPAREDNESS AMID INCREASING WEATHER EVENTS

     

    FOR IMMEDIATE RELEASE

    January 29, 2025

    HONOLULU — The state of Hawai‘i Department of Commerce and Consumer Affairs (DCCA) is urging residents and business owners to prioritize emergency preparedness in response to the rise of weather events throughout the state. The department is offering vital resources and information on how to safeguard property, ensure continued utility services, understand insurance coverage, avoid scams, and navigate the disaster recovery process.

    Key Emergency Preparedness Tips:

     

    1. Preparing Homes and Businesses for Disasters
    • Create an Emergency Plan: Establish clear evacuation routes, designating safe areas for family members or employees. Ensure everyone knows the plan and conduct practice drills regularly.
    • Secure Property: Reinforce windows and doors, check roofing and siding for potential vulnerabilities, and secure outdoor objects that could become projectiles.
    • Emergency Kits: Stock essential supplies including water, non-perishable food, medications, flashlights, batteries, first-aid supplies, cash, and any special items required by family members or staff.
    • Prepare for Business Disruption: Businesses should develop continuity plans, back up important data, and ensure essential services can be maintained during and after a disaster.
    1. Utility Emergency Preparedness
    • Sign Up for Crucial Updates: Register for utility provider notifications to receive alerts about service disruptions, outages and updates during emergencies. Visit the links below to sign up:
      • Hawaiian Electric
      • KIUC
    • Keep the Lights On: Consider investing in backup power sources like generators or solar-powered systems to maintain key operations during service outages.
    • Stay Safe: Keep gas, water and electrical systems well-maintained, and learn how to shut off utilities in case of a leak or other emergency. Visit the links below to report a power outage or potential safety issues:
      • Hawaiian Electric
      • KIUC
    • Stay Informed: To learn more about public utilities and utility preparedness, please visit the DCCA Division of Consumer Advocacy.

     

    1. Understanding Insurance Coverage for Disasters
    • Review Your Insurance Policy: Ensure that your home and business insurance policies cover common disaster-related risks, including floods, fires and hurricanes. Standard policies may not cover all types of damage.
    • Document Property: Take inventory of your belongings and keep photos and/or videos of property, valuables and important documents in case you need to file an insurance claim.
    • Know Your Deductibles and Coverage Limits: Be aware of your policy’s terms, including any exclusions or specific disaster-related deductibles.
    • Seek Input or Assistance: The DCCA Insurance Division can help you understand the claims process and provide assistance with other insurance questions or issues.
    • Stay Informed: To learn more about Insurance, please visit the DCCA Insurance Division.
    1. Identifying Disaster-Related Consumer Scams
    • Be Cautious of Fraud: Scammers often exploit disasters to prey on vulnerable consumers. Common scams include fake contractors, charity fraud and phishing emails or texts offering government assistance.
    • Check Credentials: When doing repairs on your property, always hire licensed and insured contractors, and never pay for services up front. Report suspicious activities to the DCCA Regulated Industries Complaints Office.
    • Verify Charity Solicitations: Before donating to disaster relief efforts, ensure that the charity is legitimate. Use resources like the Better Business Bureau or Charity Navigator to check organizations’ credibility.
    • Stay Informed: To learn more about consumer protection, please visit the DCCA Office of Consumer Protection.
    1. Disaster Recovery Resources for Homeowners and Business Owners
    • For Homeowners: FEMA and other government agencies offer financial assistance for home repairs, temporary housing and disaster-related expenses. Visit https://www.fema.gov/ for more information.
    • For Business Owners: The U.S. Small Business Administration (SBA) provides low-interest disaster loans to help businesses recover from physical damage and economic losses. Visit https://www.sba.gov/ for more information.
    • Stay Informed: To learn more about disaster recovery loans and financial assistance, please visit the DCCA Division of Financial Institutions.

    These resources, along with other emergency preparedness information, are available on the DCCA website.

    “Taking steps to prepare now can make all the difference in the aftermath of a disaster,” shares DCCA Director Nadine Ando. “Whether it’s preparing your property, understanding your insurance, or protecting yourself from fraud, DCCA is here to help our community stay safe and recover quickly.”

    For more information or to report any disaster-related consumer concerns, visit the DCCA website or contact the DCCA directly.

    ###

    Media Contact:

    Communications Office
    Department of Commerce and Consumer Affairs

    Phone: 808-586-2760
    Email: [email protected]

    MIL OSI USA News –

  • MIL-OSI USA: Governor Newsom provides ongoing support to help business owners and workers recover from LA firestorms

    Source: US State of California 2

    Jan 29, 2025

    What you need to know: As part of ongoing actions to help support workers and businesses impacted by the Los Angeles area fires, Governor Newsom is issuing an executive order to defer licensing fees and streamline requirements for certain small businesses. The order also defers annual licensure fees for thousands of impacted workers – from nurses and barbers to contractors and dental hygienists.

    LOS ANGELES — To help Los Angeles continue to recover and rebuild, Governor Gavin Newsom today issued an executive order to support small business owners and workers impacted by Los Angeles-area firestorms. The executive order provides relief to help local businesses recover quickly by deferring annual licensure fees for workers and businesses and waiving other requirements that may impose barriers to recovery. 

    “Small businesses are not only key to a thriving economy but make up the heart of healthy communities. As we help Los Angeles rise and rebuild, it is crucial that we protect and support the businesses and workers affected. Just as we have removed red tape to rebuild our homes, we are breaking down barriers and helping pave the way for impacted businesses and workers to get back on their feet.”

    Governor Gavin Newsom

    The executive order helps workers and business owners by:

    • Extending the deadline to pay for renewing licenses, certificates, and permits for one year for licenses with a renewal date occurring between January 1, 2025, and July 1, 2025.
    • Waiving fees for businesses and workers requesting duplicate or replacement of a license certificate that was burned or destroyed.
    • Extending deadlines for businesses to appeal license-related proceedings.
    • Eliminating requirements that make it more difficult to relocate certain businesses impacted by the fires. 

    Find resources to help your business at gov.ca.gov/LAfires/help-your-business.

    Helping businesses and workers recover

    California has worked with federal and local providers to help businesses and workers with the resources and support they need to recover and rebuild from the firestorms.

    • Supporting workers and employers: The Employment Development Department (EDD) supports workers with unemployment, disability insurance, or Paid Family Leave benefits, including Disaster Unemployment Assistance (DUA) for those who do not qualify for regular unemployment benefits. Citizenship or immigration status doesn’t affect eligibility for disability insurance or Paid Family leave. Employers can request a 60-day extension on payroll reports and taxes, or participate in the Work Sharing program. California also announced $20 million to create temporary jobs in impacted areas and deliver other supportive services through America’s Job Center of California.
    • On-the-ground advisors for small businesses: 200+ business advisors from Small Business Support Centers funded through the California Office of the Small Business Advocate’s (CalOSBA) Technical Assistance Program (TAP) are staffed across the region, including business advisors from the Small Business Development Center (SBDC) and Women’s Business Center (WBC). All of these TAP partners can answer questions about key aspects of economic recovery, including the loan application process, insurance inquiries, employee and workforce support, and business planning related individual recovery plans.  SBDC and WBC staff are co-located at the Disaster Recovery Center at Pasadena City College and the Disaster Loan Outreach Center in Camarillo (Ventura County), as well as various Business Recovery Centers organized by the U.S. Small Business Administration (SBA).
    • Providing resources for recovery: CalOSBA has launched a Resource Guide for small businesses impacted by the wildfires through its Outsmart Disaster website, and is conducting a series of online trainings in both English and Spanish.
    • Financial assistance for businesses: The California Infrastructure and Economic Development Bank (IBank) is offering loan programs for businesses from one to 750 employees affected by the LA wildfires. Disaster Relief Loan Guarantee Program (DRLGP) issues loan guarantees up to 95% of the loan through IBank’s partner Financial Development Corporations to help small business borrowers impacted by disaster who need term loans or lines of credit for working capital. 
    • Expediting licensing for contractors: The Contractor State Licensing Board (CSLB) is processing licensing applications as fast as 48 hours from the time an application and exam are complete. Rapid licensing will support the Governor’s efforts to rebuild the homes and businesses destroyed. 
    • Helping fire survivors rebuild safely: CSLB is also partnering with state agencies to directly assist survivors at the Southern California Disaster Recovery Centers, urging them to only hire California-licensed contractors for repairs or to rebuild their homes or businesses. CSLB’s Disaster Hotline 1-800-962-1125 and online Disaster Help Center are also providing valuable support to survivors.
    • Protecting against unlicensed contractors: Investigation teams are on the ground, posting signs to put unlicensed contractors on notice that it is a felony to contract without a license in a California disaster area. Consumers are urged to always check licenses before hiring a contractor and notify the state of unlicensed activity immediately. Consumers can file complaints and find additional resources online at www2.cslb.ca.gov.
    • Helping licensees rebuild their businesses: The Board of Barbering and Cosmetology, the Board of Accountancy, and other DCA boards are rescheduling licensing examinations at no charge and assisting licensees by issuing duplicate licenses due to a physical license being lost in the fires.

    Governor Newsom has issued a number of executive orders in response to the Los Angeles firestorms to help aid in rebuilding and recovery, create more temporary housing, and protect survivors from exploitation and price gouging.

    Get help today

    For those Californians impacted by the firestorms in Los Angeles, there are resources available.Californians can go to CA.gov/LAfires – a hub for information and resources from state, local and federal government.  

    Individuals and business owners who sustained losses from wildfires in Los Angeles County can apply for disaster assistance:

    If you use a relay service, such as video relay service (VRS), captioned telephone service or others, give FEMA the number for that service.

    Recent news

    Jan 29, 2025

    News Los Angeles, California – Governor Gavin Newsom today issued a proclamation declaring January 29, 2025, as Lunar New Year.The text of the proclamation and a copy can be found below: PROCLAMATIONCalifornia joins people throughout the country and around the world…

    Jan 28, 2025

    News SACRAMENTO – Governor Gavin Newsom today announced the following appointments:Deborah Hoffman, of Sacramento, has been appointed Chief Deputy Director at the Office of Tax Appeals. Hoffman has been Special Advisor at the California Department of Veterans Affairs…

    Jan 28, 2025

    News What you need to know: Governor Newsom met today with leaders of the Pacific Palisades synagogue Kehillat Israel, which still stands after the fire. Los Angeles, California – Today, Governor Gavin Newsom met with clergy, staff, and board members of Kehillat…

    MIL OSI USA News –

  • MIL-OSI USA: Governor Newsom proclaims Lunar New Year 2025

    Source: US State of California 2

    Jan 29, 2025

    Los Angeles, California – Governor Gavin Newsom today issued a proclamation declaring January 29, 2025, as Lunar New Year.

    The text of the proclamation and a copy can be found below:

    PROCLAMATION

    California joins people throughout the country and around the world in celebrating Lunar New Year, ushering in good fortune and good wishes with the new year, and lifting up the diverse and dynamic communities that help make our state and nation what they are today.
     
    Asian American and Pacific Islander (AAPI) communities have shaped this state through foundational contributions to our past, present, and future. As we celebrate this rich heritage, with its many amazing leaders and accomplishments, we also recognize the ugly history of violence and discrimination against these communities, and reaffirm that, for the sake of our neighbors and fellow Californians, all of us must confront racism in all its forms, both past and present. 
     
    Our state’s vibrant diversity is a deep point of pride and a source of enduring strength, and as we recognize Lunar New Year as an official state holiday for the third year, we invite everyone to appreciate the traditions of this special holiday. Two years after the tragedy in Monterey Park, we also honor the memory of those senselessly taken from us, and hold in our hearts the brave survivors and all those mourning lost friends and loved ones.
     
    Today and every day, let us show support and solidarity for our AAPI friends, family, and neighbors and recognize their irreplaceable contributions to our California story. As the Year of the Snake begins, we wish happiness and good fortune to all.
     
    NOW THEREFORE I, GAVIN NEWSOM, Governor of the State of California, do hereby proclaim January 29, 2025, as “Lunar New Year.”

    IN WITNESS WHEREOF I have hereunto set my hand and caused the Great Seal of the State of California to be affixed this 28th day of January 2025.

    GAVIN NEWSOM
    Governor of California

    ATTEST:
    SHIRLEY N. WEBER, Ph.D.
    Secretary of State

    Press Releases

    Recent news

    Jan 28, 2025

    News SACRAMENTO – Governor Gavin Newsom today announced the following appointments:Deborah Hoffman, of Sacramento, has been appointed Chief Deputy Director at the Office of Tax Appeals. Hoffman has been Special Advisor at the California Department of Veterans Affairs…

    Jan 28, 2025

    News What you need to know: Governor Newsom met today with leaders of the Pacific Palisades synagogue Kehillat Israel, which still stands after the fire. Los Angeles, California – Today, Governor Gavin Newsom met with clergy, staff, and board members of Kehillat…

    Jan 28, 2025

    News Dodgers Chairman Mark Walter, Mark Walter Family Foundation, and Los Angeles Dodgers Foundation will provide an initial commitment of up to $100 million   LA Rises will support city and county efforts to help accelerate recovery LOS ANGELES — In the wake of one…

    MIL OSI USA News –

  • MIL-OSI: Portman Ridge Finance Corporation and Logan Ridge Finance Corporation Enter into Merger Agreement

    Source: GlobeNewswire (MIL-OSI)

    Combined Entity Will be Managed by Sierra Crest Investment Management, LLC, an Affiliate of BC Partners Advisors L.P.

    Companies to Host a Joint Conference Call on January 30, 2025, at 4:00 PM ET to Discuss the Proposed Merger

    NEW YORK, Jan. 30, 2025 (GLOBE NEWSWIRE) — Portman Ridge Finance Corporation (NASDAQ: PTMN) (“Portman Ridge” or “PTMN”) and Logan Ridge Finance Corporation (NASDAQ: LRFC) (“Logan Ridge” or “LRFC”) (together, the “Companies”), business development companies (“BDCs”) managed by affiliates of BC Partners Advisors L.P. (“BC Partners”), announced today that they have entered into an agreement under which LRFC will merge with and into PTMN (the “Proposed Merger”), subject to the receipt of certain shareholder approvals and the satisfaction of other closing conditions. Pursuant to the Proposed Merger agreement, Portman Ridge will be the surviving public entity and will continue to trade on the Nasdaq under the symbol “PTMN.”

    The Boards of Directors of both PTMN and LRFC, on the recommendation of their respective Special Committees consisting solely of certain independent directors, have unanimously approved the Proposed Merger. In addition, the Board of Directors of LRFC will recommend that shareholders of LRFC vote in favor of the Proposed Merger, and the Board of Directors of PTMN will recommend that shareholders of PTMN vote in favor of the issuance of PTMN common stock in connection with the Proposed Merger, in each case, subject to certain conditions.

    Transaction Highlights

    • Size & Scale: The Proposed Merger will significantly increase the size and scale of Portman Ridge, which is expected to translate into increased trading volume and improved secondary liquidity, lower operating expenses and potentially greater access to more diverse sources of financing at a lower cost. The combined company will be externally managed by Sierra Crest Investment Management LLC (“Sierra Crest”), the current investment adviser to Portman Ridge, and is expected to have total assets in excess of $600 million, and a net asset value (“NAV”) of approximately $270 million, each based on the Companies’ September 30, 2024 balance sheets, adjusted for estimated transaction expenses, but excluding the impact of the Tax Distribution (as defined below).
    • Portfolio Overlap: The Proposed Merger will result in the acquisition of a known, diversified portfolio with significant portfolio overlap between the two Companies. PTMN and LRFC employ the same investment strategy, and the BC Partners Credit Platform has been allocating substantially similar or the same investments to both Companies since Mount Logan Management, LLC (“Mount Logan”) became LRFC’s external investment adviser on July 1, 2021. As a result, more than 70% of the investments in LRFC’s portfolio at fair value are expected to be BC Partners-originated assets at the time of closing, with over 60% of the portfolio overlapping with PTMN. The combination of two known, complementary portfolios, originated and managed by the BC Partners Credit Platform, is expected to substantially mitigate integration risk.
    • Accretive to NAV: Expected to be immediately accretive to PTMN’s NAV by 1.3% upon closing, based on the Companies’ September 30, 2024, NAVs and adjusted for estimated transaction expenses but excluding the impact of the Tax Distribution.
    • Accretive to Core Net Investment Income (“NII”): Expected to be immediately accretive to the Companies’ NII as result of an expected $2.8 million of annual operating expense efficiencies and the Incentive Fee Waiver (as defined below). Over the longer term, management of the Companies expects the Proposed Merger to provide further NII accretion through a lower cost of debt and improved financing terms as well as further rotation out of LRFC’s legacy non-yielding equity portfolio into interest-earning assets originated by the BC Partners Credit Platform.
    • Increased Borrowing Capacity & Optimized Debt Capital Structure: As a result of the recent refinancing of LRFC’s credit facility with KeyBank National Association (“KeyBank”), LRFC currently has additional available borrowing base that can be used for future deployment at the combined company. With LRFC’s refinanced credit facility with KeyBank and PTMN’s existing senior secured revolving credit facility with JPMorgan Chase Bank, National Association in place, the combined company is expected to be able to further optimize its debt capital structure based on differing eligibility requirements and advance rates.
    • Research Coverage: The increase in Portman Ridge’s market capitalization is expected to facilitate additional research coverage.

    Fixed Exchange Ratio

    In connection with the Proposed Merger, shareholders of LRFC will receive 1.50 newly issued shares of PTMN common stock in exchange for each share of common stock of LRFC (the “Fixed Exchange Ratio”). Based on the Fixed Exchange Ratio, using PTMN’s closing price of $16.68 per share on January 24, 2025 and excluding the impact of the Tax Distribution, the merger consideration values LRFC’s shares at $25.02 per share, which represents a 4% premium to LRFC’s January 24, 2025, closing price of $24.00 per share and a 17% premium to LRFC’s closing price of $21.43 per share on September 11, 2024 (which was the date immediately prior to the announcement of LRFC’s successful exit of its investment in Nth Degree Investment Group, LLC, an important catalyst for this transaction).

    In addition to approval by shareholders of both PTMN and LRFC, the closing of the Proposed Merger is subject to customary conditions. Further, the merger agreement provides each Special Committee a termination right that allows for either Special Committee to terminate the Proposed Merger if it has determined, reasonably and in good faith, as a result of events or other circumstances occurring or arising after the date of the signing of the Proposed Merger agreement that were not known to the applicable Board of Directors, that the interests of their respective shareholders would be diluted within the meaning of Rule 17a-8 under the Investment Company Act of 1940, as amended (the “1940 Act”), as a result of the Proposed Merger.

    The parties currently expect the Proposed Merger to be completed in the second calendar quarter of 2025.

    Additional Transaction Details

    In connection with and in support of the transaction, only if the Proposed Merger is consummated, PTMN’s external investment adviser, Sierra Crest, has agreed to waive up to $1.5 million of incentive fees over eight consecutive quarters following the closing of the Proposed Merger, subject to the satisfaction of certain conditions set forth in the definitive documentation executed between Sierra Crest and PTMN (the “Incentive Fee Waiver”).

    Prior to the anticipated closing of the Proposed Merger, PTMN and LRFC intend to declare and pay ordinary course quarterly dividends.

    Subject to the approval of LRFC’s Board of Directors and contingent upon the satisfaction of the closing conditions to the Proposed Merger, LRFC will declare a dividend to LRFC’s shareholders in an amount totaling no less than $1.0 million, but otherwise equal to any undistributed 2024 NII of LRFC estimated to be remaining as of the closing of the Proposed Merger, which management of LRFC currently expects to be between approximately $1.0 million and $1.5 million (the “Tax Distribution”).

    Management Commentary

    Ted Goldthorpe, President and Chief Executive Officer of PTMN and LRFC and Head of the BC Partners Credit Platform, stated, “I am incredibly proud to announce the proposed combination of PTMN and LRFC. Based on the September 30, 2024 net assets value of each company and inclusive of an estimated Tax Distribution, LRFC shareholders will receive merger consideration equal to approximately 98% of its September 30, 2024 net asset value. This combination is the culmination of a journey we embarked upon over three and half years ago, when shareholders of Logan Ridge placed their trust and confidence in the management team and the BC Partners Credit Platform by appointing Mount Logan to serve as the investment adviser to Logan Ridge. During this time, we have transformed LRFC’s investment portfolio by substantially reducing the non-income producing legacy equity exposure, reducing non-accruals, significantly increasing the portfolio’s diversification and growing LRFC’s exposure to credits originated by the BC Partners Credit Platform. Importantly, by the time this transaction closes and barring any unexpected repayments, we expect that more than 70% of Logan Ridge’s portfolio at fair value to be in portfolio companies financed by the BC Partners Credit Platform. Further, we have materially lowered Logan Ridge’s cost of debt capital and lowered operating expenses. The collective result of these efforts has been the stable and growing operating earnings LRFC has generated over this time, which in turn has been used to reward shareholders with a stable and growing dividend. More importantly, LRFC’s management did all of this against the backdrop of particularly challenging and uncertain market conditions. The combination of these Companies is a marquee transaction for the platform and a significant milestone for the BC Partners Credit Platform. I couldn’t be more excited for the future of the combined company.

    We believe now is the right time to combine the Companies, as we can finally do so in a manner that is expected to be accretive to both sets of shareholders. The merger will significantly increase the size and scale of Portman Ridge, which we believe will translate into increased trading volume and improved secondary liquidity, lower operating expenses and potentially greater access to more diverse sources of financing at a lower cost.

    Looking ahead, we will continue to execute our strategy of targeting inorganic growth opportunities that we believe have the potential to be earnings accretive for shareholders of both PTMN and LRFC. I look forward to updating our shareholders on the work management will be doing on this front over the course of 2025.”

    Transaction Advisors

    Keefe, Bruyette & Woods, A Stifel Company, is serving as financial advisor to the Special Committee of PTMN in connection with the transaction. Stradley Ronon Stevens & Young, LLP is acting as the legal counsel to the Special Committee of PTMN.

    Houlihan Lokey is serving as financial advisor to the Special Committee of LRFC in connection with the transaction. Skadden, Arps, Slate, Meagher & Flom LLP is acting as the legal counsel to the Special Committee of LRFC.

    Simpson Thacher & Bartlett LLP is serving as legal counsel to PTMN and LRFC with respect to the transaction. Dechert LLP serves as legal counsel to PTMN and LRFC.

    Conference Call Details

    PTMN and LRFC will host a joint conference call on Thursday, January 30, 2025, at 4:00 PM ET to discuss the transaction. All interested persons are invited to attend the call and should dial (646) 307-1963 approximately 10 minutes prior to the start of the conference call and use the conference ID 4584554. A live audio webcast of the conference call can be accessed via the Internet, on a listen-only basis on both Company’s websites, www.portmanridge.com, and www.loganridge.com, in the Investor Relations sections under Events and Presentations. The webcast can also be accessed by clicking the following link: https://edge.media-server.com/mmc/p/sx9vwkih. The online archive of the webcast will be available on the Company’s websites shortly after the call.

    The Companies will be utilizing an investor presentation as an accompaniment to the live call, which will be available on LRFC’s website at www.loganridgefinance.com and PTMN’s website at www.portmanridge.com.

    About Logan Ridge Finance Corporation

    Logan Ridge Finance Corporation (NASDAQ: LRFC) is a BDC that invests primarily in first lien loans and, to a lesser extent, second lien loans and equity securities issued by lower middle-market companies. LRFC invests in performing, well-established middle-market businesses that operate across a wide range of industries. It employs fundamental credit analysis, targeting investments in businesses with relatively low levels of cyclicality and operating risk. For more information, visit www.loganridgefinance.com.

    About Portman Ridge Finance Corporation

    Portman Ridge Finance Corporation (NASDAQ: PTMN) is a publicly traded, externally managed investment company that has elected to be regulated as a BDC under the 1940 Act. Portman Ridge’s middle market investment business originates, structures, finances and manages a portfolio of term loans, mezzanine investments and selected equity securities in middle market companies. Portman Ridge’s investment activities are managed by its investment adviser, Sierra Crest.
    Portman Ridge’s filings with the Securities and Exchange Commission (the “SEC”), earnings releases, press releases and other financial, operational and governance information are available on Portman Ridge’s website at www.portmanridge.com.

    Forward-Looking Statements

    Some of the statements in this document constitute forward-looking statements because they relate to future events, future performance or financial condition. The forward-looking statements may include statements as to future operating results of PTMN and LRFC, and distribution projections; business prospects of PTMN and LRFC, and the prospects of their portfolio companies; and the impact of the investments that PTMN and LRFC expect to make. In addition, words such as “anticipate,” “believe,” “expect,” “seek,” “plan,” “should,” “estimate,” “project” and “intend” indicate forward-looking statements, although not all forward-looking statements include these words. The forward-looking statements contained in this document involve risks and uncertainties. Certain factors could cause actual results and conditions to differ materially from those projected, including the uncertainties associated with (i) the ability of the parties to consummate the merger on the expected timeline, or at all; (ii) the expected synergies and savings associated with the merger; (iii) the ability to realize the anticipated benefits of the merger, including the expected elimination of certain expenses and costs due to the merger; (iv) the percentage of PTMN shareholders and LRFC shareholders voting in favor of the applicable Proposal (as defined below) submitted for their approval; (v) the possibility that competing offers or acquisition proposals will be made; (vi) the possibility that any or all of the various conditions to the consummation of the merger may not be satisfied or waived; (vii) risks related to diverting management’s attention from ongoing business operations; (viii) the combined company’s plans, expectations, objectives and intentions, as a result of the merger; (ix) any potential termination of the merger agreement; (x) the future operating results and net investment income projections of PTMN, LRFC or, following the closing of the merger, the combined company; (xi) the ability of Sierra Crest to implement its future plans with respect to the combined company; (xii) the ability of Sierra Crest and its affiliates to attract and retain highly talented professionals; (xiii) the business prospects of PTMN, LRFC or, following the closing of the merger, the combined company, and the prospects of their portfolio companies; (xiv) the impact of the investments that PTMN, LRFC or, following the closing of the merger, the combined company expect to make; (xv) the ability of the portfolio companies of PTMN, LRFC or, following the closing of the merger, the combined company to achieve their objectives; (xvi) the expected financings and investments and additional leverage that PTMN, LRFC or, following the closing of the merger, the combined company may seek to incur in the future; (xvii) the adequacy of the cash resources and working capital of PTMN, LRFC or, following the closing of the merger, the combined company; (xviii) the timing of cash flows, if any, from the operations of the portfolio companies of PTMN, LRFC or, following the closing of the merger, the combined company; (xix) the risk that stockholder litigation in connection with the merger may result in significant costs of defense and liability; and (xx) future changes in laws or regulations (including the interpretation of these laws and regulations by regulatory authorities). PTMN and LRFC have based the forward-looking statements included in this document on information available to them on the date hereof, and they assume no obligation to update any such forward-looking statements. Although PTMN and LRFC undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that they may make directly to you or through reports that PTMN and LRFC in the future may file with the SEC, including the Joint Proxy Statement and Registration Statement (in each case, as defined below), annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

    No Offer or Solicitation

    This document is not, and under no circumstances is it to be construed as, a prospectus or an advertisement and the communication of this document is not, and under no circumstances is it to be construed as, an offer to sell or a solicitation of an offer to purchase any securities in PTMN, LRFC or in any fund or other investment vehicle managed by BC Partners or any of its affiliates.

    Additional Information and Where to Find It

    This document relates to the proposed merger and certain related matters (the “Proposals”). In connection with the Proposals, PTMN will file with the SEC and mail to its and LRFC’s respective shareholders a combined joint proxy statement for PTMN and LRFC and a prospectus of PTMN (the “Registration Statement”). The Registration Statement will contain important information about PTMN, LRFC and the Proposals. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. SHAREHOLDERS OF PTMN AND LRFC ARE URGED TO READ THE REGISTRATION STATEMENT, AND OTHER DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT PTMN, LRFC AND THE PROPOSALS. Investors and security holders will be able to obtain the documents filed with the SEC free of charge at the SEC’s website, http://www.sec.gov or, for documents filed by PTMN, from PTMN’s website at https://www.portmanridge.com, and, for documents filed by LRFC, from LRFC’s website at https://www.loganridgefinance.com.

    Participants in the Solicitation

    PTMN, its directors, certain of its executive officers and certain employees and officers of Sierra Crest and its affiliates may be deemed to be participants in the solicitation of proxies in connection with the Proposals. Information about the directors and executive officers of PTMN is set forth in its proxy statement for its 2024 Annual Meeting of Stockholders, which was filed with the SEC on April 29, 2024. LRFC, its directors, certain of its executive officers and certain employees and officers of Mount Logan and its affiliates may be deemed to be participants in the solicitation of proxies in connection with the Proposals. Information about the directors and executive officers of LRFC is set forth in the proxy statement for its 2024 Annual Meeting of Stockholders, which was filed with the SEC on April 29, 2024. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of the PTMN and LRFC shareholders in connection with the Proposals will be contained in the Registration Statement, including the Joint Proxy Statement included therein, and other relevant materials when such documents become available. These documents may be obtained free of charge from the sources indicated above.

    Contacts:
    Portman Ridge Finance Corporation
    650 Madison Avenue, 3rd floor
    New York, NY 10022
    info@portmanridge.com

    Brandon Satoren
    Chief Financial Officer
    Brandon.Satoren@bcpartners.com
    (212) 891-2880

    The Equity Group Inc.
    Lena Cati
    lcati@equityny.com
    (212) 836-9611

    Val Ferraro
    vferraro@equityny.com
    (212) 836-9633

    The MIL Network –

  • MIL-OSI: First Merchants Corporation Announces Fourth Quarter 2024 Earnings Per Share

    Source: GlobeNewswire (MIL-OSI)

    MUNCIE, Ind., Jan. 30, 2025 (GLOBE NEWSWIRE) — First Merchants Corporation (NASDAQ – FRME)

    Fourth Quarter 2024 Highlights:

    • Net income available to common stockholders was $63.9 million and diluted earnings per common share totaled $1.10, compared to $48.7 million and $0.84 in the third quarter of 2024, and $42.0 million and $0.71 in the fourth quarter of 2023. Excluding the impact of the branch sale and repositioning of the available for sale securities portfolio, adjusted net income available to common stockholders1was $58.1 million or $1.00 per share for the fourth quarter of 2024.
    • Strong capital position with Common Equity Tier 1 Capital Ratio of 11.43% and Tangible Common Equity to Tangible Assets Ratio of 8.81%.
    • Net interest margin was 3.28% compared to 3.23% on a linked quarter basis and 3.16% in the fourth quarter of 2023.
    • Total loans grew $185.6 million, or 5.9% annualized, on a linked quarter basis, and $368.1 million, or 2.9% during the last twelve months.
    • Total deposits increased $156.5 million, or 4.4% annualized, on a linked quarter basis, and declined $32.4 million, or 0.2%, during the last twelve months after normalizing for deposits sold during the fourth quarter.
    • Nonperforming assets to total assets were 43 basis points compared to 35 basis points on a linked quarter basis.
    • Adjusted efficiency ratio totaled 53.60%1for the quarter.
    • Completed the sale of five Illinois branches and certain loans and deposits to Old Second National Bank on December 6, 2024.

    “The fourth quarter was a strong finish to the year and showed the momentum we have built with healthy increases in core earnings, NIM and ROA,” said Mark Hardwick, Chief Executive Officer of First Merchants Bank. “We restructured a portion of our securities portfolio and completed the Illinois branch sale to help prioritize our core markets. These actions and the completion of multiple technology initiatives in 2024 have positioned First Merchants to deliver strong results in 2025.”

    Fourth Quarter Financial Results:

    First Merchants Corporation (the “Corporation”) reported fourth quarter 2024 net income available to common stockholders of $63.9 million compared to $42.0 million during the same period in 2023. Diluted earnings per common share for the period totaled $1.10 compared to the fourth quarter of 2023 result of $0.71. Excluding non-core income and expenses incurred in each period, adjusted net income available to common stockholders1 for the fourth quarter 2024 was $58.1 million, or $1.00 diluted earnings per common share compared to $53.4 million, or $0.90 in the same period in 2023.

    During the quarter, the Corporation completed the sale of five Illinois branches along with loans of $7.4 million and deposits of $267.4 million, generating a gain of $20.0 million recorded in non-interest income. The sale of these branches represents the Corporation’s exit from suburban Chicago markets.

    Total assets equaled $18.3 billion and loans totaled $12.9 billion as of quarter-end. During the past twelve months, total loans grew by $368.1 million, or 2.9%. On a linked quarter basis, loans grew $185.6 million, or 5.9% annualized, with growth primarily in commercial loans.

    Investments totaling $3.5 billion decreased $350.7 million, or 9.2%, during the last twelve months and decreased $201.5 million on a linked quarter basis. The decline during the quarter was partially due to the sale of $109.6 million of available for sale securities with a weighted average tax-equivalent yield of 2.31%, which resulted in a loss of $11.6 million. The remaining decline for the quarter was due to security paydowns and maturities, as well as a decline in valuation of securities reflecting the movement of interest rates. Sales of available for sale securities in 2024 totaled $268.5 million and resulted in a loss of $20.8 million.

    Total deposits were $14.5 billion as of quarter-end and decreased by $299.8 million, or 2.0%, over the past twelve months. The decline was primarily due to the sale of the Illinois branches during the fourth quarter which included $267.4 million of deposits. Excluding this impact, deposits declined by $32.4 million in 2024. On a linked quarter basis, deposits grew by $156.5 million, or 4.4% annualized. The loan to deposit ratio increased slightly to 88.5% at period end from 88.0% in the prior quarter.

    The Corporation’s Allowance for Credit Losses – Loans (ACL) totaled $192.8 million as of quarter-end, or 1.50% of total loans, an increase of $4.9 million from prior quarter. Loan charge-offs, net of recoveries totaled $0.8 million and provision for loans of $5.7 million was recorded during the quarter. Reserves for unfunded commitments totaled $18.0 million declining during the quarter due to reserve release of $1.5 million. Net provision for the quarter totaled $4.2 million. Non-performing assets to total assets were 43 basis points for the fourth quarter of 2024, an increase of eight basis points compared to 35 basis points in the prior quarter.

    Net interest income totaled $134.4 million for the quarter, an increase of $3.3 million, or 2.5%, compared to the prior quarter and an increase of $4.3 million, or 3.3%, compared to the fourth quarter of 2023. Fully taxable equivalent net interest margin was 3.28%, an increase of five basis points compared to the third quarter of 2024, and an increase of 12 basis points compared to the fourth quarter of 2023. The increase in net interest margin compared to the third quarter was due to lower funding costs and a more favorable earning asset and funding mix.

    Noninterest income totaled $42.7 million for the quarter, an increase of $17.9 million compared to the third quarter of 2024 and an increase of $16.3 million compared to the fourth quarter of 2023. When excluding non-core income from each period, noninterest income totaled $34.4 million for the quarter, an increase of $0.4 million compared to third quarter of 2024, and an increase of $5.6 million compared to the fourth quarter of 2023. The increase in core noninterest income over the fourth quarter of 2023 was primarily due to an increase in gains on sales of loans and CRA investment income.

    Noninterest expense totaled $96.3 million for the quarter, an increase of $1.7 million from the third quarter of 2024 and a decrease of $11.8 million from the fourth quarter of 2023. The increase in the linked quarter was from higher marketing costs and other one-time operating expenses. The decrease from the fourth quarter of 2023 was due to one-time charges incurred in the prior year which included an FDIC special assessment, early retirement and severance costs, and a lease termination.

    The Corporation’s total risk-based capital ratio totaled 13.31%, common equity tier 1 capital ratio totaled 11.43%, and the tangible common equity ratio totaled 8.81%. These ratios continue to reflect the Corporation’s strong liquidity and capital positions.

    1 See “Non-GAAP Financial Information” for reconciliation

    CONFERENCE CALL

    First Merchants Corporation will conduct a fourth quarter earnings conference call and webcast at 11:30 a.m. (ET) on Thursday, January 30, 2025.

    To access via phone, participants will need to register using the following link where they will be provided a phone number and access code: (https://register.vevent.com/register/BIc49ad0293a7844dca2e7171f51e600dd95f36e86b6)

    To view the webcast and presentation slides, please go to (https://edge.media-server.com/mmc/p/9t5v76m2) during the time of the call. A replay of the webcast will be available until January 30, 2026.

    Detailed financial results are reported on the attached pages.

    About First Merchants Corporation

    First Merchants Corporation is a financial holding company headquartered in Muncie, Indiana. The Corporation has one full-service bank charter, First Merchants Bank. The Bank also operates as First Merchants Private Wealth Advisors (as a division of First Merchants Bank).

    First Merchants Corporation’s common stock is traded on the NASDAQ Global Select Market System under the symbol FRME. Quotations are carried in daily newspapers and can be found on the company’s Internet web page (http://www.firstmerchants.com).

    FIRST MERCHANTS and the Shield Logo are federally registered trademarks of First Merchants Corporation.

    Forward-Looking Statements

    This release contains forward-looking statements made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can often, but not always, be identified by the use of words like “believe”, “continue”, “pattern”, “estimate”, “project”, “intend”, “anticipate”, “expect” and similar expressions or future or conditional verbs such as “will”, “would”, “should”, “could”, “might”, “can”, “may”, or similar expressions. These statements include statements about First Merchants’ goals, intentions and expectations; statements regarding the First Merchants’ business plan and growth strategies; statements regarding the asset quality of First Merchants’ loan and investment portfolios; and estimates of First Merchants’ risks and future costs and benefits. These forward-looking statements are subject to significant risks, assumptions and uncertainties that may cause results to differ materially from those set forth in forward-looking statements, including, among other things: possible changes in monetary and fiscal policies, and laws and regulations; the effects of easing restrictions on participants in the financial services industry; the cost and other effects of legal and administrative cases; possible changes in the credit worthiness of customers and the possible impairment of collectability of loans; fluctuations in market rates of interest; competitive factors in the banking industry; changes in the banking legislation or regulatory requirements of federal and state agencies applicable to bank holding companies and banks like First Merchants’ affiliate bank; continued availability of earnings and excess capital sufficient for the lawful and prudent declaration of dividends; changes in market, economic, operational, liquidity (including the ability to grow and maintain core deposits and retain large, uninsured deposits), credit and interest rate risks associated with the First Merchants’ business; and other risks and factors identified in each of First Merchants’ filings with the Securities and Exchange Commission. First Merchants does not undertake any obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this press release. In addition, First Merchants’ past results of operations do not necessarily indicate its anticipated future results.

    CONSOLIDATED BALANCE SHEETS      
    (Dollars In Thousands) December 31,
        2024       2023  
    ASSETS      
    Cash and due from banks $ 87,616     $ 112,649  
    Interest-bearing deposits   298,891       436,080  
    Investment securities, net of allowance for credit losses of $245,000 and $245,000   3,460,695       3,811,364  
    Loans held for sale   18,663       18,934  
    Loans   12,854,359       12,486,027  
    Less: Allowance for credit losses – loans   (192,757 )     (204,934 )
    Net loans   12,661,602       12,281,093  
    Premises and equipment   129,743       133,896  
    Federal Home Loan Bank stock   41,690       41,769  
    Interest receivable   91,829       97,664  
    Goodwill and other intangibles   731,830       739,101  
    Cash surrender value of life insurance   304,906       306,301  
    Other real estate owned   4,948       4,831  
    Tax asset, deferred and receivable   92,387       99,883  
    Other assets   387,169       322,322  
    TOTAL ASSETS $ 18,311,969     $ 18,405,887  
    LIABILITIES      
    Deposits:      
    Noninterest-bearing $ 2,325,579     $ 2,500,062  
    Interest-bearing   12,196,047       12,321,391  
    Total Deposits   14,521,626       14,821,453  
    Borrowings:      
    Federal funds purchased   99,226       —  
    Securities sold under repurchase agreements   142,876       157,280  
    Federal Home Loan Bank advances   822,554       712,852  
    Subordinated debentures and other borrowings   93,529       158,644  
    Total Borrowings   1,158,185       1,028,776  
    Interest payable   16,102       18,912  
    Other liabilities   311,073       289,033  
    Total Liabilities   16,006,986       16,158,174  
    STOCKHOLDERS’ EQUITY      
    Preferred Stock, $1,000 par value, $1,000 liquidation value:      
    Authorized — 600 cumulative shares      
    Issued and outstanding – 125 cumulative shares   125       125  
    Preferred Stock, Series A, no par value, $2,500 liquidation preference:      
    Authorized — 10,000 non-cumulative perpetual shares      
    Issued and outstanding – 10,000 non-cumulative perpetual shares   25,000       25,000  
    Common Stock, $.125 stated value:      
    Authorized — 100,000,000 shares      
    Issued and outstanding – 57,974,535 and 59,424,122 shares   7,247       7,428  
    Additional paid-in capital   1,188,768       1,236,506  
    Retained earnings   1,272,528       1,154,624  
    Accumulated other comprehensive loss   (188,685 )     (175,970 )
    Total Stockholders’ Equity   2,304,983       2,247,713  
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 18,311,969     $ 18,405,887  
     
    CONSOLIDATED STATEMENTS OF INCOME Three Months Ended   Twelve Months Ended
    (Dollars In Thousands, Except Per Share Amounts) December 31,   December 31,
        2024       2023       2024       2023  
    INTEREST INCOME              
    Loans:              
    Taxable $ 197,536     $ 197,523     $ 803,652     $ 747,837  
    Tax-exempt   9,020       8,197       34,262       31,954  
    Investment securities:              
    Taxable   9,024       8,644       36,086       35,207  
    Tax-exempt   12,754       13,821       53,487       58,117  
    Deposits with financial institutions   5,350       8,034       16,992       17,719  
    Federal Home Loan Bank stock   958       771       3,527       3,052  
    Total Interest Income   234,642       236,990       948,006       893,886  
    INTEREST EXPENSE              
    Deposits   89,835       96,655       386,127       306,092  
    Federal funds purchased   26       1       481       1,421  
    Securities sold under repurchase agreements   680       827       3,057       3,451  
    Federal Home Loan Bank advances   8,171       6,431       29,886       27,206  
    Subordinated debentures and other borrowings   1,560       3,013       7,341       10,316  
    Total Interest Expense   100,272       106,927       426,892       348,486  
    NET INTEREST INCOME   134,370       130,063       521,114       545,400  
    Provision for credit losses   4,200       1,500       35,700       3,500  
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES   130,170       128,563       485,414       541,900  
    NONINTEREST INCOME              
    Service charges on deposit accounts   8,124       7,690       32,606       30,837  
    Fiduciary and wealth management fees   8,665       8,187       34,215       30,840  
    Card payment fees   4,957       4,437       19,317       18,862  
    Net gains and fees on sales of loans   5,681       4,111       20,840       15,659  
    Derivative hedge fees   1,594       1,049       3,082       3,385  
    Other customer fees   316       237       1,547       1,880  
    Earnings on cash surrender value of life insurance   2,188       3,202       8,464       8,347  
    Net realized losses on sales of available for sale securities   (11,592 )     (2,317 )     (20,757 )     (6,930 )
    Gain on branch sale   19,983       —       19,983       —  
    Other income (loss)   2,826       (152 )     6,283       2,722  
    Total Noninterest Income   42,742       26,444       125,580       105,602  
    NONINTEREST EXPENSES              
    Salaries and employee benefits   55,437       60,967       221,167       228,745  
    Net occupancy   7,335       9,089       28,387       29,859  
    Equipment   7,028       6,108       26,802       24,113  
    Marketing   2,582       2,647       7,389       7,427  
    Outside data processing fees   6,029       5,875       27,140       25,165  
    Printing and office supplies   377       402       1,462       1,552  
    Intangible asset amortization   1,771       2,182       7,271       8,743  
    FDIC assessments   3,744       7,557       15,029       14,674  
    Other real estate owned and foreclosure expenses   227       1,743       2,076       3,318  
    Professional and other outside services   3,777       3,981       14,586       16,172  
    Other expenses   7,982       7,552       27,957       28,502  
    Total Noninterest Expenses   96,289       108,103       379,266       388,270  
    INCOME BEFORE INCOME TAX   76,623       46,904       231,728       259,232  
    Income tax expense   12,274       4,425       30,326       35,446  
    NET INCOME   64,349       42,479       201,402       223,786  
    Preferred stock dividends   469       469       1,875       1,875  
    NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $ 63,880     $ 42,010     $ 199,527     $ 221,911  
    Per Share Data:              
    Basic Net Income Available to Common Stockholders $ 1.10     $ 0.71     $ 3.42     $ 3.74  
    Diluted Net Income Available to Common Stockholders $ 1.10     $ 0.71     $ 3.41     $ 3.73  
    Cash Dividends Paid to Common Stockholders $ 0.35     $ 0.34     $ 1.39     $ 1.34  
    Average Diluted Common Shares Outstanding (in thousands)   58,247       59,556       58,533       59,489  
     
    FINANCIAL HIGHLIGHTS              
    (Dollars in thousands) Three Months Ended   Twelve Months Ended
      December 31,   December 31,
        2024       2023       2024       2023  
    NET CHARGE-OFFS $ 771     $ 3,148     $ 49,377     $ 25,643  
                   
    AVERAGE BALANCES:              
    Total Assets $ 18,478,303     $ 18,397,200     $ 18,400,495     $ 18,186,507  
    Total Loans   12,757,676       12,396,451       12,634,324       12,297,974  
    Total Earning Assets   17,089,198       17,222,714       17,054,267       16,991,787  
    Total Deposits   14,788,294       15,000,580       14,816,564       14,721,498  
    Total Stockholders’ Equity   2,312,270       2,130,993       2,252,491       2,127,262  
                   
    FINANCIAL RATIOS:              
    Return on Average Assets   1.39 %     0.92 %     1.09 %     1.23 %
    Return on Average Stockholders’ Equity   11.05       7.89       8.86       10.43  
    Return on Tangible Common Stockholders’ Equity   16.75       12.75       13.71       16.76  
    Average Earning Assets to Average Assets   92.48       93.62       92.68       93.43  
    Allowance for Credit Losses – Loans as % of Total Loans   1.50       1.64       1.50       1.64  
    Net Charge-offs as % of Average Loans (Annualized)   0.02       0.10       0.39       0.21  
    Average Stockholders’ Equity to Average Assets   12.51       11.58       12.24       11.70  
    Tax Equivalent Yield on Average Earning Assets   5.63       5.64       5.69       5.40  
    Interest Expense/Average Earning Assets   2.35       2.48       2.50       2.05  
    Net Interest Margin (FTE) on Average Earning Assets   3.28       3.16       3.19       3.35  
    Efficiency Ratio   48.48       63.26       53.55       55.17  
    Tangible Common Book Value Per Share $ 26.78     $ 25.06     $ 26.78     $ 25.06  
     
    NONPERFORMING ASSETS                  
    (Dollars In Thousands) December 31,   September 30,   June 30,   March 31,   December 31,
        2024       2024       2024       2024       2023  
    Nonaccrual Loans $ 73,773     $ 59,088     $ 61,906     $ 62,478     $ 53,580  
    Other Real Estate Owned and Repossessions   4,948       5,247       4,824       4,886       4,831  
    Nonperforming Assets (NPA)   78,721       64,335       66,730       67,364       58,411  
    90+ Days Delinquent   5,902       14,105       1,686       2,838       172  
    NPAs & 90 Day Delinquent $ 84,623     $ 78,440     $ 68,416     $ 70,202     $ 58,583  
                       
    Allowance for Credit Losses – Loans $ 192,757     $ 187,828     $ 189,537     $ 204,681     $ 204,934  
    Quarterly Net Charge-offs   771       6,709       39,644       2,253       3,148  
    NPAs / Actual Assets %   0.43 %     0.35 %     0.36 %     0.37 %     0.32 %
    NPAs & 90 Day / Actual Assets %   0.46 %     0.43 %     0.37 %     0.38 %     0.32 %
    NPAs / Actual Loans and OREO %   0.61 %     0.51 %     0.53 %     0.54 %     0.47 %
    Allowance for Credit Losses – Loans / Actual Loans (%)   1.50 %     1.48 %     1.50 %     1.64 %     1.64 %
    Net Charge-offs as % of Average Loans (Annualized)   0.02 %     0.21 %     1.26 %     0.07 %     0.10 %
     
    CONSOLIDATED BALANCE SHEETS                  
    (Dollars In Thousands) December 31,   September 30,   June 30,   March 31,   December 31,
        2024       2024       2024       2024       2023  
    ASSETS                  
    Cash and due from banks $ 87,616     $ 84,719     $ 105,372     $ 100,514     $ 112,649  
    Interest-bearing deposits   298,891       359,126       168,528       410,497       436,080  
    Investment securities, net of allowance for credit losses   3,460,695       3,662,145       3,753,088       3,783,574       3,811,364  
    Loans held for sale   18,663       40,652       32,292       15,118       18,934  
    Loans   12,854,359       12,646,808       12,639,650       12,465,582       12,486,027  
    Less: Allowance for credit losses – loans   (192,757 )     (187,828 )     (189,537 )     (204,681 )     (204,934 )
    Net loans   12,661,602       12,458,980       12,450,113       12,260,901       12,281,093  
    Premises and equipment   129,743       129,582       133,245       132,706       133,896  
    Federal Home Loan Bank stock   41,690       41,716       41,738       41,758       41,769  
    Interest receivable   91,829       92,055       97,546       92,550       97,664  
    Goodwill and other intangibles   731,830       733,601       735,373       737,144       739,101  
    Cash surrender value of life insurance   304,906       304,613       306,379       306,028       306,301  
    Other real estate owned   4,948       5,247       4,824       4,886       4,831  
    Tax asset, deferred and receivable   92,387       86,732       107,080       101,121       99,883  
    Other assets   387,169       348,384       367,845       331,006       322,322  
    TOTAL ASSETS $ 18,311,969     $ 18,347,552     $ 18,303,423     $ 18,317,803     $ 18,405,887  
    LIABILITIES                  
    Deposits:                  
    Noninterest-bearing $ 2,325,579     $ 2,334,197     $ 2,303,313     $ 2,338,364     $ 2,500,062  
    Interest-bearing   12,196,047       12,030,903       12,265,757       12,546,220       12,321,391  
    Total Deposits   14,521,626       14,365,100       14,569,070       14,884,584       14,821,453  
    Borrowings:                  
    Federal funds purchased   99,226       30,000       147,229       —       —  
    Securities sold under repurchase agreements   142,876       124,894       100,451       130,264       157,280  
    Federal Home Loan Bank advances   822,554       832,629       832,703       612,778       712,852  
    Subordinated debentures and other borrowings   93,529       93,562       93,589       118,612       158,644  
    Total Borrowings   1,158,185       1,081,085       1,173,972       861,654       1,028,776  
    Deposits and other liabilities held for sale   —       288,476       —       —       —  
    Interest payable   16,102       18,089       18,554       19,262       18,912  
    Other liabilities   311,073       292,429       329,302       327,500       289,033  
    Total Liabilities   16,006,986       16,045,179       16,090,898       16,093,000       16,158,174  
    STOCKHOLDERS’ EQUITY                  
    Preferred Stock, $1,000 par value, $1,000 liquidation value:                  
    Authorized — 600 cumulative shares                  
    Issued and outstanding – 125 cumulative shares   125       125       125       125       125  
    Preferred Stock, Series A, no par value, $2,500 liquidation preference:                  
    Authorized — 10,000 non-cumulative perpetual shares                  
    Issued and outstanding – 10,000 non-cumulative perpetual shares   25,000       25,000       25,000       25,000       25,000  
    Common Stock, $.125 stated value:                  
    Authorized — 100,000,000 shares                  
    Issued and outstanding   7,247       7,265       7,256       7,321       7,428  
    Additional paid-in capital   1,188,768       1,192,683       1,191,193       1,208,447       1,236,506  
    Retained earnings   1,272,528       1,229,125       1,200,930       1,181,939       1,154,624  
    Accumulated other comprehensive loss   (188,685 )     (151,825 )     (211,979 )     (198,029 )     (175,970 )
    Total Stockholders’ Equity   2,304,983       2,302,373       2,212,525       2,224,803       2,247,713  
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 18,311,969     $ 18,347,552     $ 18,303,423     $ 18,317,803     $ 18,405,887  
                       
    CONSOLIDATED STATEMENTS OF INCOME                  
    (Dollars In Thousands, Except Per Share Amounts) December 31,   September 30,   June 30,   March 31,   December 31,
        2024       2024       2024       2024       2023  
    INTEREST INCOME                  
    Loans:                  
    Taxable $ 197,536     $ 206,680     $ 201,413     $ 198,023     $ 197,523  
    Tax-exempt   9,020       8,622       8,430       8,190       8,197  
    Investment securities:                  
    Taxable   9,024       9,263       9,051       8,748       8,644  
    Tax-exempt   12,754       13,509       13,613       13,611       13,821  
    Deposits with financial institutions   5,350       2,154       2,995       6,493       8,034  
    Federal Home Loan Bank stock   958       855       879       835       771  
    Total Interest Income   234,642       241,083       236,381       235,900       236,990  
    INTEREST EXPENSE                  
    Deposits   89,835       98,856       99,151       98,285       96,655  
    Federal funds purchased   26       329       126       —       1  
    Securities sold under repurchase agreements   680       700       645       1,032       827  
    Federal Home Loan Bank advances   8,171       8,544       6,398       6,773       6,431  
    Subordinated debentures and other borrowings   1,560       1,544       1,490       2,747       3,013  
    Total Interest Expense   100,272       109,973       107,810       108,837       106,927  
    NET INTEREST INCOME   134,370       131,110       128,571       127,063       130,063  
    Provision for credit losses   4,200       5,000       24,500       2,000       1,500  
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES   130,170       126,110       104,071       125,063       128,563  
    NONINTEREST INCOME                  
    Service charges on deposit accounts   8,124       8,361       8,214       7,907       7,690  
    Fiduciary and wealth management fees   8,665       8,525       8,825       8,200       8,187  
    Card payment fees   4,957       5,121       4,739       4,500       4,437  
    Net gains and fees on sales of loans   5,681       6,764       5,141       3,254       4,111  
    Derivative hedge fees   1,594       736       489       263       1,049  
    Other customer fees   316       344       460       427       237  
    Earnings on cash surrender value of life insurance   2,188       2,755       1,929       1,592       3,202  
    Net realized losses on sales of available for sale securities   (11,592 )     (9,114 )     (49 )     (2 )     (2,317 )
    Gain on branch sale   19,983       —       —       —       —  
    Other income (loss)   2,826       1,374       1,586       497       (152 )
    Total Noninterest Income   42,742       24,866       31,334       26,638       26,444  
    NONINTEREST EXPENSES                  
    Salaries and employee benefits   55,437       55,223       52,214       58,293       60,967  
    Net occupancy   7,335       6,994       6,746       7,312       9,089  
    Equipment   7,028       6,949       6,599       6,226       6,108  
    Marketing   2,582       1,836       1,773       1,198       2,647  
    Outside data processing fees   6,029       7,150       7,072       6,889       5,875  
    Printing and office supplies   377       378       354       353       402  
    Intangible asset amortization   1,771       1,772       1,771       1,957       2,182  
    FDIC assessments   3,744       3,720       3,278       4,287       7,557  
    Other real estate owned and foreclosure expenses   227       942       373       534       1,743  
    Professional and other outside services   3,777       3,035       3,822       3,952       3,981  
    Other expenses   7,982       6,630       7,411       5,934       7,552  
    Total Noninterest Expenses   96,289       94,629       91,413       96,935       108,103  
    INCOME BEFORE INCOME TAX   76,623       56,347       43,992       54,766       46,904  
    Income tax expense   12,274       7,160       4,067       6,825       4,425  
    NET INCOME   64,349       49,187       39,925       47,941       42,479  
    Preferred stock dividends   469       468       469       469       469  
    NET INCOME AVAILABLE TO COMMON STOCKHOLDERS $ 63,880     $ 48,719     $ 39,456     $ 47,472     $ 42,010  
    Per Share Data:                  
    Basic Net Income Available to Common Stockholders $ 1.10     $ 0.84     $ 0.68     $ 0.80     $ 0.71  
    Diluted Net Income Available to Common Stockholders $ 1.10     $ 0.84     $ 0.68     $ 0.80     $ 0.71  
    Cash Dividends Paid to Common Stockholders $ 0.35     $ 0.35     $ 0.35     $ 0.34     $ 0.34  
    Average Diluted Common Shares Outstanding (in thousands)   58,247       58,289       58,328       59,273       59,556  
    FINANCIAL RATIOS:                  
    Return on Average Assets   1.39 %     1.07 %     0.87 %     1.04 %     0.92 %
    Return on Average Stockholders’ Equity   11.05       8.66       7.16       8.47       7.89  
    Return on Tangible Common Stockholders’ Equity   16.75       13.39       11.29       13.21       12.75  
    Average Earning Assets to Average Assets   92.48       92.54       92.81       92.91       93.62  
    Allowance for Credit Losses – Loans as % of Total Loans   1.50       1.48       1.50       1.64       1.64  
    Net Charge-offs as % of Average Loans (Annualized)   0.02       0.21       1.26       0.07       0.10  
    Average Stockholders’ Equity to Average Assets   12.51       12.26       12.02       12.17       11.58  
    Tax Equivalent Yield on Average Earning Assets   5.63       5.82       5.69       5.65       5.64  
    Interest Expense/Average Earning Assets   2.35       2.59       2.53       2.55       2.48  
    Net Interest Margin (FTE) on Average Earning Assets   3.28       3.23       3.16       3.10       3.16  
    Efficiency Ratio   48.48       53.76       53.84       59.21       63.26  
    Tangible Common Book Value Per Share $ 26.78     $ 26.64     $ 25.10     $ 25.07     $ 25.06  
    LOANS                  
    (Dollars In Thousands) December 31,   September 30,   June 30,   March 31,   December 31,
        2024       2024       2024       2024       2023  
    Commercial and industrial loans $ 4,114,292     $ 4,041,217     $ 3,949,817     $ 3,722,365     $ 3,670,948  
    Agricultural land, production and other loans to farmers   256,312       238,743       239,926       234,431       263,414  
    Real estate loans:                  
    Construction   792,144       814,704       823,267       941,726       957,545  
    Commercial real estate, non-owner occupied   2,274,016       2,251,351       2,323,533       2,368,360       2,400,839  
    Commercial real estate, owner occupied   1,157,944       1,152,751       1,174,195       1,137,894       1,162,083  
    Residential   2,374,729       2,366,943       2,370,905       2,316,490       2,288,921  
    Home equity   659,811       641,188       631,104       618,258       617,571  
    Individuals’ loans for household and other personal expenditures   166,028       158,480       162,089       161,459       168,388  
    Public finance and other commercial loans   1,059,083       981,431       964,814       964,599       956,318  
    Loans   12,854,359       12,646,808       12,639,650       12,465,582       12,486,027  
    Allowance for credit losses – loans   (192,757 )     (187,828 )     (189,537 )     (204,681 )     (204,934 )
    NET LOANS $ 12,661,602     $ 12,458,980     $ 12,450,113     $ 12,260,901     $ 12,281,093  
     
    DEPOSITS                  
    (Dollars In Thousands) December 31,   September 30,   June 30,   March 31,   December 31,
      2024   2024   2024   2024   2023
    Demand deposits $ 7,980,061   $ 7,678,510   $ 7,757,679   $ 7,771,976   $ 7,965,862
    Savings deposits   4,522,758     4,302,236     4,339,161     4,679,593     4,516,433
    Certificates and other time deposits of $100,000 or more   1,043,068     1,277,833     1,415,131     1,451,443     1,408,985
    Other certificates and time deposits   692,068     802,949     889,949     901,280     849,906
    Brokered certificates of deposits1   283,671     303,572     167,150     80,292     80,267
    TOTAL DEPOSITS2 $ 14,521,626   $ 14,365,100   $ 14,569,070   $ 14,884,584   $ 14,821,453

    1 – Total brokered deposits of $955.7 million, which includes brokered CD’s of $283.7 million at December 31, 2024.
    2 – Total deposits at September 30, 2024 excluded $287.7 million of deposits reclassified to Deposits and other liabilities held for sale related to the Illinois branch sale. The sale of $267.4 million of deposits associated with the Illinois branch sale was subsequently completed on December 6, 2024.

    CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS            
    (Dollars in Thousands)                      
      For the Three Months Ended
      December 31, 2024   December 31, 2023
      Average Balance   Interest
    Income /
    Expense    		   Average
    Rate    		   Average Balance   Interest
    Income /
    Expense    		   Average
    Rate
    ASSETS                      
    Interest-bearing deposits $ 522,868   $ 5,350   4.09 %   $ 700,705   $ 8,034   4.59 %
    Federal Home Loan Bank stock   41,703     958   9.19       41,792     771   7.38  
    Investment Securities:(1)                      
    Taxable   1,677,554     9,024   2.15       1,801,533     8,644   1.92  
    Tax-exempt(2)   2,089,397     16,144   3.09       2,282,233     17,495   3.07  
    Total Investment Securities   3,766,951     25,168   2.67       4,083,766     26,139   2.56  
    Loans held for sale   36,219     550   6.07       16,355     246   6.02  
    Loans:(3)                      
    Commercial   8,753,723     156,414   7.15       8,533,233     159,190   7.46  
    Real estate mortgage   2,177,351     24,401   4.48       2,118,060     21,829   4.12  
    HELOC and installment   841,537     16,171   7.69       820,728     16,258   7.92  
    Tax-exempt(2)   948,846     11,418   4.81       908,075     10,376   4.57  
    Total Loans   12,757,676     208,954   6.55       12,396,451     207,899   6.71  
    Total Earning Assets   17,089,198     240,430   5.63 %     17,222,714     242,843   5.64 %
    Total Non-Earning Assets   1,389,105             1,174,486        
    TOTAL ASSETS $ 18,478,303           $ 18,397,200        
    LIABILITIES                      
    Interest-Bearing Deposits:                      
    Interest-bearing deposits $ 5,564,228   $ 37,049   2.66 %   $ 5,504,725   $ 40,996   2.98 %
    Money market deposits   3,189,334     25,463   3.19       3,096,085     27,909   3.61  
    Savings deposits   1,362,705     3,102   0.91       1,587,758     3,913   0.99  
    Certificates and other time deposits   2,313,284     24,221   4.19       2,225,528     23,837   4.28  
    Total Interest-Bearing Deposits   12,429,551     89,835   2.89       12,414,096     96,655   3.11  
    Borrowings   1,049,677     10,437   3.98       1,013,856     10,272   4.05  
    Total Interest-Bearing Liabilities   13,479,228     100,272   2.98       13,427,952     106,927   3.19  
    Noninterest-bearing deposits   2,358,743             2,586,484        
    Other liabilities   328,062             251,771        
    Total Liabilities   16,166,033             16,266,207        
    STOCKHOLDERS’ EQUITY   2,312,270             2,130,993        
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 18,478,303     100,272       $ 18,397,200     106,927    
    Net Interest Income (FTE)     $ 140,158           $ 135,916    
    Net Interest Spread (FTE)(4)         2.65 %           2.45 %
                           
    Net Interest Margin (FTE):                      
    Interest Income (FTE) / Average Earning Assets         5.63 %           5.64 %
    Interest Expense / Average Earning Assets         2.35 %           2.48 %
    Net Interest Margin (FTE)(5)         3.28 %           3.16 %
                           
    (1)Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis.
    (2)Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2024 and 2023. These totals equal $5,788 and $5,853 for the three months ended December 31, 2024 and 2023, respectively.
    (3)Non accruing loans have been included in the average balances.
    (4)Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities.
    (5)Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets.
     
                           
    CONSOLIDATED AVERAGE BALANCE SHEET AND NET INTEREST MARGIN ANALYSIS            
    (Dollars in Thousands)                      
      For the Twelve Months Ended
      December 31, 2024   December 31, 2023
      Average Balance   Interest
    Income /
    Expense    		   Average
    Rate    		   Average Balance   Interest
    Income /
    Expense    		   Average
    Rate
    Assets:                      
    Interest-bearing deposits $ 418,163   $ 16,992   4.06 %   $ 431,581   $ 17,719   4.11 %
    Federal Home Loan Bank stock   41,736     3,527   8.45       41,319     3,052   7.39  
    Investment Securities:(1)                      
    Taxable   1,759,578     36,086   2.05       1,854,438     35,207   1.90  
    Tax-exempt(2)   2,200,466     67,705   3.08       2,366,475     73,566   3.11  
    Total Investment Securities   3,960,044     103,791   2.62       4,220,913     108,773   2.58  
    Loans held for sale   29,650     1,792   6.04       21,766     1,292   5.94  
    Loans:(3)                      
    Commercial   8,687,638     641,393   7.38       8,519,706     603,611   7.08  
    Real estate mortgage   2,158,743     94,890   4.40       2,035,488     82,183   4.04  
    HELOC and installment   830,079     65,577   7.90       830,006     60,751   7.32  
    Tax-exempt(2)   928,214     43,370   4.67       891,008     40,448   4.54  
    Total Loans   12,634,324     847,022   6.70       12,297,974     788,285   6.41  
    Total Earning Assets   17,054,267     971,332   5.69 %     16,991,787     917,829   5.40 %
    Total Non-Earning Assets   1,346,228             1,194,720        
    Total Assets $ 18,400,495           $ 18,186,507        
    Liabilities:                      
    Interest-Bearing deposits:                      
    Interest-bearing deposits $ 5,506,492   $ 157,984   2.87 %   $ 5,435,733   $ 138,012   2.54 %
    Money market deposits   3,061,461     106,026   3.46       2,884,271     83,777   2.90  
    Savings deposits   1,463,707     14,587   1.00       1,694,230     14,606   0.86  
    Certificates and other time deposits   2,413,900     107,530   4.45       1,923,268     69,697   3.62  
    Total Interest-Bearing Deposits   12,445,560     386,127   3.10       11,937,502     306,092   2.56  
    Borrowings   1,005,017     40,765   4.06       1,111,472     42,394   3.81  
    Total Interest-Bearing Liabilities   13,450,577     426,892   3.17       13,048,974     348,486   2.67  
    Noninterest-bearing deposits   2,371,004             2,783,996        
    Other liabilities   326,423             226,275        
    Total Liabilities   16,148,004             16,059,245        
    Stockholders’ Equity   2,252,491             2,127,262        
    Total Liabilities and Stockholders’ Equity $ 18,400,495     426,892       $ 18,186,507     348,486    
    Net Interest Income (FTE)     $ 544,440           $ 569,343    
    Net Interest Spread (FTE)(4)         2.52 %           2.73 %
                           
    Net Interest Margin (FTE):                      
    Interest Income (FTE) / Average Earning Assets         5.69 %           5.40 %
    Interest Expense / Average Earning Assets         2.50 %           2.05 %
    Net Interest Margin (FTE)(5)         3.19 %           3.35 %
                           
    (1)Average balance of securities is computed based on the average of the historical amortized cost balances without the effects of the fair value adjustments. Annualized amounts are computed using a 30/360 day basis.
    (2)Tax-exempt securities and loans are presented on a fully taxable equivalent basis, using a marginal tax rate of 21 percent for 2024 and 2023. These totals equal $23,326 and $23,943 for the years ended December 31, 2024 and 2023, respectively.
    (3)Non accruing loans have been included in the average balances.           
    (4)Net Interest Spread (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average interest-bearing liabilities.
    (5)Net Interest Margin (FTE) is interest income expressed as a percentage of average earning assets minus interest expense expressed as a percentage of average earning assets.
     
    ADJUSTED NET INCOME AND DILUTED EARNINGS PER COMMON SHARE – NON-GAAP
    (Dollars In Thousands, Except Per Share Amounts) Three Months Ended   Twelve Months Ended
      December 31,   September 30,   June 30,   March 31,   December 31,   December 31,   December 31,
        2024       2024       2024       2024       2023       2024       2023  
    Net Income Available to Common Stockholders – GAAP $ 63,880     $ 48,719     $ 39,456     $ 47,472     $ 42,010     $ 199,527     $ 221,911  
    Adjustments:                          
    PPP loan income   —       —       —       —       (7 )     —       (49 )
    Net realized losses on sales of available for sale securities   11,592       9,114       49       2       2,317       20,757       6,930  
    Gain on branch sale   (19,983 )     —       —       —       —       (19,983 )     —  
    Non-core expenses1,2,3   762       —       —       3,481       12,682       4,243       12,682  
    Tax on adjustments   1,851       (2,220 )     (12 )     (848 )     (3,652 )     (1,229 )     (4,767 )
    Adjusted Net Income Available to Common Stockholders – Non-GAAP $ 58,102     $ 55,613     $ 39,493     $ 50,107     $ 53,350     $ 203,315     $ 236,707  
                               
    Average Diluted Common Shares Outstanding (in thousands)   58,247       58,289       58,328       59,273       59,556       58,533       59,489  
                               
    Diluted Earnings Per Common Share – GAAP $ 1.10     $ 0.84     $ 0.68     $ 0.80     $ 0.71     $ 3.41     $ 3.73  
    Adjustments:                          
    PPP loan income   —       —       —       —       —       —       —  
    Net realized losses on sales of available for sale securities   0.20       0.15       —       —       0.04       0.35       0.12  
    Gain on branch sale   (0.34 )     —       —       —       —       (0.34 )     —  
    Non-core expenses1,2,3   0.01       —       —       0.06       0.21       0.07       0.21  
    Tax on adjustments   0.03       (0.04 )     —       (0.01 )     (0.06 )     (0.02 )     (0.08 )
    Adjusted Diluted Earnings Per Common Share – Non-GAAP $ 1.00     $ 0.95     $ 0.68     $ 0.85     $ 0.90     $ 3.47     $ 3.98  

    1 – Non-core expenses in 4Q24 included $0.8 million of costs directly related to the branch sale.
    2 – Non-core expenses in 1Q24 included $2.4 million from duplicative online banking conversion costs and $1.1 million from the FDIC special assessment.
    3 – Non-core expenses in 4Q23 included $6.3 million from early retirement and severance costs, $4.3 million from the FDIC special assessment, and $2.1 million from a lease termination.

    NET INTEREST MARGIN (“NIM”), ADJUSTED                
    (Dollars in Thousands)                
      Three Months Ended   Twelve Months Ended
      December 31,   September 30,   June 30,   March 31,   December 31,   December 31,   December 31,
        2024       2024       2024       2024       2023       2024       2023  
    Net Interest Income (GAAP) $ 134,370     $ 131,110     $ 128,571     $ 127,063     $ 130,063     $ 521,114     $ 545,400  
    Fully Taxable Equivalent (“FTE”) Adjustment   5,788       5,883       5,859       5,795       5,853       23,326       23,943  
    Net Interest Income (FTE) (non-GAAP) $ 140,158     $ 136,993     $ 134,430     $ 132,858     $ 135,916     $ 544,440     $ 569,343  
                               
    Average Earning Assets (GAAP) $ 17,089,198     $ 16,990,358     $ 17,013,984     $ 17,123,851     $ 17,222,714     $ 17,054,267     $ 16,991,787  
    Net Interest Margin (GAAP)   3.15 %     3.09 %     3.02 %     2.97 %     3.02 %     3.06 %     3.21 %
    Net Interest Margin (FTE) (non-GAAP)   3.28 %     3.23 %     3.16 %     3.10 %     3.16 %     3.19 %     3.35 %
     
    RETURN ON TANGIBLE COMMON EQUITY – NON-GAAP
    (Dollars In Thousands) Three Months Ended   Twelve Months Ended
      December 31,   September 30,   June 30,   March 31,   December 31,   December 31,   December 31,
        2024       2024       2024       2024       2023       2024       2023  
    Total Average Stockholders’ Equity (GAAP) $ 2,312,270     $ 2,251,547     $ 2,203,361     $ 2,242,139     $ 2,130,993     $ 2,252,491     $ 2,127,262  
    Less: Average Preferred Stock   (25,125 )     (25,125 )     (25,125 )     (25,125 )     (25,125 )     (25,125 )     (25,125 )
    Less: Average Intangible Assets, Net of Tax   (728,218 )     (729,581 )     (730,980 )     (732,432 )     (734,007 )     (730,295 )     (736,601 )
    Average Tangible Common Equity, Net of Tax (Non-GAAP) $ 1,558,927     $ 1,496,841     $ 1,447,256     $ 1,484,582     $ 1,371,861     $ 1,497,071     $ 1,365,536  
                               
    Net Income Available to Common Stockholders (GAAP) $ 63,880     $ 48,719     $ 39,456     $ 47,472     $ 42,010     $ 199,527     $ 221,911  
    Plus: Intangible Asset Amortization, Net of Tax   1,399       1,399       1,399       1,546       1,724       5,744       6,906  
    Tangible Net Income (Non-GAAP) $ 65,279     $ 50,118     $ 40,855     $ 49,018     $ 43,734     $ 205,271     $ 228,817  
                               
    Return on Tangible Common Equity (Non-GAAP)   16.75 %     13.39 %     11.29 %     13.21 %     12.75 %     13.71 %     16.76 %
     
    EFFICIENCY RATIO – NON-GAAP                          
    (Dollars In Thousands) Three Months Ended   Twelve Months Ended
      December 31,   September 30,   June 30,   March 31,   December 31,   December 31,   December 31,
        2024       2024       2024       2024       2023       2024       2023  
    Non Interest Expense (GAAP) $ 96,289     $ 94,629     $ 91,413     $ 96,935     $ 108,103     $ 379,266     $ 388,270  
    Less: Intangible Asset Amortization   (1,771 )     (1,772 )     (1,771 )     (1,957 )     (2,182 )     (7,271 )     (8,743 )
    Less: OREO and Foreclosure Expenses   (227 )     (942 )     (373 )     (534 )     (1,743 )     (2,076 )     (3,318 )
    Adjusted Non Interest Expense (Non-GAAP) $ 94,291     $ 91,915     $ 89,269     $ 94,444     $ 104,178     $ 369,919     $ 376,209  
                               
    Net Interest Income (GAAP) $ 134,370     $ 131,110     $ 128,571     $ 127,063     $ 130,063     $ 521,114     $ 545,400  
    Plus: Fully Taxable Equivalent Adjustment   5,788       5,883       5,859       5,795       5,853       23,326       23,943  
    Net Interest Income on a Fully Taxable Equivalent Basis (Non-GAAP) $ 140,158     $ 136,993     $ 134,430     $ 132,858     $ 135,916     $ 544,440     $ 569,343  
                               
    Non Interest Income (GAAP) $ 42,742     $ 24,866     $ 31,334     $ 26,638     $ 26,444     $ 125,580     $ 105,602  
    Less: Investment Securities (Gains) Losses   11,592       9,114       49       2       2,317       20,757       6,930  
    Adjusted Non Interest Income (Non-GAAP) $ 54,334     $ 33,980     $ 31,383     $ 26,640     $ 28,761     $ 146,337     $ 112,532  
    Adjusted Revenue (Non-GAAP) $ 194,492     $ 170,973     $ 165,813     $ 159,498     $ 164,677     $ 690,777     $ 681,875  
    Efficiency Ratio (Non-GAAP)   48.48 %     53.76 %     53.84 %     59.21 %     63.26 %     53.55 %     55.17 %
                               
    Adjusted Non Interest Expense (Non-GAAP) $ 94,291     $ 91,915     $ 89,269     $ 94,444     $ 104,178     $ 369,919     $ 376,209  
    Less: Acquisition-related Expenses   —       —       —       —       —       —       —  
    Less: Non-core Expenses1,2,3   (762 )     —       —       (3,481 )     (12,682 )     (4,243 )     (12,682 )
    Adjusted Non Interest Expense Excluding Non-core Expenses (Non-GAAP) $ 93,529     $ 91,915     $ 89,269     $ 90,963     $ 91,496     $ 365,676     $ 363,527  
                               
    Adjusted Revenue (Non-GAAP) $ 194,492     $ 170,973     $ 165,813     $ 159,498     $ 164,677     $ 690,777     $ 681,875  
    Less: Gain on Branch Sale   (19,983 )     —       —       —       —       (19,983 )     —  
    Adjusted Revenue Excluding Gain on Branch Sale (Non-GAAP) $ 174,509     $ 170,973     $ 165,813     $ 159,498     $ 164,677     $ 670,794     $ 681,875  
    Adjusted Efficiency Ratio (Non-GAAP)   53.60 %     53.76 %     53.84 %     57.03 %     55.56 %     54.51 %     53.31 %

    1 – Non-core expenses in 4Q24 included $0.8 million of costs directly related to the branch sale.
    2 – Non-core expenses in 1Q24 included $2.4 million from duplicative online banking conversion costs and $1.1 million from the FDIC special assessment.
    3 – Non-core expenses in 4Q23 included $6.3 million from early retirement and severance costs, $4.3 million from the FDIC special assessment, and $2.1 million from a lease termination.

    For more information, contact:
    Nicole M. Weaver, Vice President and Director of Corporate Administration
    765-521-7619
    http://www.firstmerchants.com

    SOURCE: First Merchants Corporation, Muncie, Indiana

    The MIL Network –

  • MIL-OSI: Parker Reports Fiscal 2025 Second Quarter Results

    Source: GlobeNewswire (MIL-OSI)

    CLEVELAND, Jan. 30, 2025 (GLOBE NEWSWIRE) — Parker Hannifin Corporation (NYSE: PH), the global leader in motion and control technologies, today reported results for the quarter ended December 31, 2024, that included the following highlights (compared with the prior year quarter):

    Fiscal 2025 Second Quarter Highlights:

    • Sales were $4.7 billion; organic sales growth was 1%
    • Net income was $949 million, an increase of 39%, or $853 million adjusted, an increase of 6%
    • EPS were $7.25, an increase of 39%, or $6.53 adjusted, an increase of 6%
    • Segment operating margin was 22.1%, an increase of 100 bps, or 25.6% adjusted, an increase of 110 bps
    • YTD cash flow from operations increased 24% to $1.7 billion, or 17.4% of sales

    “Our performance this quarter reflects our focus on operational excellence and the strength of our balanced portfolio,” said Jenny Parmentier, Chairman and Chief Executive Officer. “We delivered record segment operating margin across all businesses, record earnings per share and year-to-date cash flow from operations. Strong cash flow from operations coupled with proceeds from previously announced divestitures allowed us to substantially reduce debt by $1.1 billion this quarter. We are encouraged to see industrial orders turn positive mainly in our longer-cycle businesses. Looking ahead, we have updated our outlook for fiscal year 2025 to reflect stronger Aerospace growth, currency headwinds and a continued delay in the expected industrial recovery. Our strong cash generation creates capital deployment optionality, and we remain committed to our strategy of actively deploying capital to drive shareholder value.”

    This news release contains non-GAAP financial measures. Reconciliations of adjusted numbers and certain non-GAAP financial measures are included in the financial tables of this press release.

    Outlook

    Guidance for the fiscal year ending June 30, 2025 has been updated. The company expects:

    • Sales growth in fiscal 2025 of (2%) to 1%, with organic sales growth of approximately 2%; divestitures of (1.5%) and unfavorable currency of (1.0%)
    • Total segment operating margin of approximately 22.7%, or approximately 25.8% on an adjusted basis
    • EPS of $24.46 to $25.06, or $26.40 to $27.00 on an adjusted basis

    Segment Results

    Diversified Industrial Segment

    North America Businesses              
    $ in mm FY25 Q2   FY24 Q2   Change   Organic Growth
    Sales $ 1,928     $ 2,110       -8.6 %     -5.0 %
    Segment Operating Income $ 427     $ 462       -7.6 %    
    Segment Operating Margin   22.1 %     21.9 %   20 bps    
    Adjusted Segment Operating Income $ 473     $ 510       -7.2 %    
    Adjusted Segment Operating Margin   24.6 %     24.2 %   40 bps    
    • Achieved record adjusted segment operating margin
    • Continued softness in transportation and off-highway markets
    • Delayed industrial recovery
    International Businesses      
    $ in mm FY25 Q2   FY24 Q2   Change   Organic Growth
    Sales $ 1,325     $ 1,404       -5.7 %     -3.0 %
    Segment Operating Income $ 284     $ 290       -2.2 %        
    Segment Operating Margin   21.4 %     20.7 %   70 bps        
    Adjusted Segment Operating Income $ 320     $ 323       -1.2 %        
    Adjusted Segment Operating Margin   24.1 %     23.0 %   110 bps        
    • Achieved record adjusted segment operating margin
    • Broad-based softness continued in Europe
    • Gradual recovery continued in Asia

    Aerospace Systems Segment

    $ in mm FY25 Q2   FY24 Q2   Change   Organic Growth
    Sales $ 1,490     $ 1,306       14.0 %     14.0 %
    Segment Operating Income $ 338     $ 263       28.5 %    
    Segment Operating Margin   22.7 %     20.1 %   260 bps    
    Adjusted Segment Operating Income $ 420     $ 347       21.2 %    
    Adjusted Segment Operating Margin   28.2 %     26.5 %   170 bps    
    • Achieved record sales and adjusted segment operating margin
    • Achieved 14% organic sales growth
    • 20%+ aftermarket and mid-single digit OEM sales growth

    Order Rates

      FY25 Q2
    Parker +5 %
    Diversified Industrial Segment – North America Businesses +3 %
    Diversified Industrial Segment – International Businesses +4 %
    Aerospace Systems Segment +9 %
    • Company order rates increased across all reported businesses
    • North America orders turned positive on long-cycle strength
    • International order growth continued, led by Asia
    • Aerospace orders accelerated against a tough prior year comparison

    About Parker Hannifin
    Parker Hannifin is a Fortune 250 global leader in motion and control technologies. For more than a century the company has been enabling engineering breakthroughs that lead to a better tomorrow. Learn more at www.parker.com or @parkerhannifin.

    Contacts:  
    Media: Financial Analysts:
    Aidan Gormley Jeff Miller
    216-896-3258 216-896-2708
    aidan.gormley@parker.com jeffrey.miller@parker.com
       

    Notice of Webcast
    Parker Hannifin’s conference call and slide presentation to discuss its fiscal 2025 second quarter results are available to all interested parties via live webcast today at 11:00 a.m. ET, at investors.parker.com. A replay of the webcast will be available on the site approximately one hour after the completion of the call and will remain available for one year. To register for e-mail notification of future events please visit investors.parker.com.

    Note on Orders The company reported orders for the quarter ending December 31, 2024, compared with the same quarter a year ago. All comparisons are at constant currency exchange rates, with the prior year quarter restated to the current-year rates, and exclude divestitures. Diversified Industrial comparisons are on 3-month average computations and Aerospace Systems comparisons are on rolling 12-month average computations.

    Note on Non-GAAP Financial Measures
    This press release contains references to non-GAAP financial information including (a) adjusted net income; (b) adjusted earnings per share; (c) adjusted operating margin and segment operating margins; (d) adjusted operating income and segment operating income and (e) organic sales growth. The adjusted net income, adjusted earnings per share, adjusted operating margin, adjusted segment operating margin, adjusted operating income, adjusted segment operating income and organic sales measures are presented to allow investors and the company to meaningfully evaluate changes in net income, earnings per share and segment operating margins on a comparable basis from period to period. Although adjusted net income, adjusted earnings per share, adjusted operating margin and segment operating margins, adjusted operating income and segment operating income, and organic sales growth are not measures of performance calculated in accordance with GAAP, we believe that they are useful to an investor in evaluating the results of this quarter versus the prior period. Comparable descriptions of record adjusted results in this release refer only to the period from the first quarter of FY2011 to the periods presented in this release. This period coincides with recast historical financial results provided in association with our FY2014 change in segment reporting. A reconciliation of non-GAAP measures is included in the financial tables of this press release.

    Forward-Looking Statements
    Forward-looking statements contained in this and other written and oral reports are made based on known events and circumstances at the time of release, and as such, are subject in the future to unforeseen uncertainties and risks. Often but not always, these statements may be identified from the use of forward-looking terminology such as “anticipates,” “believes,” “may,” “should,” “could,” “expects,” “targets,” “is likely,” “will,” or the negative of these terms and similar expressions, and may also include statements regarding future performance, orders, earnings projections, events or developments. Parker cautions readers not to place undue reliance on these statements. It is possible that the future performance may differ materially from expectations, including those based on past performance.

    Among other factors that may affect future performance are: changes in business relationships with and orders by or from major customers, suppliers or distributors, including delays or cancellations in shipments; disputes regarding contract terms, changes in contract costs and revenue estimates for new development programs; changes in product mix; ability to identify acceptable strategic acquisition targets; uncertainties surrounding timing, successful completion or integration of acquisitions and similar transactions; ability to successfully divest businesses planned for divestiture and realize the anticipated benefits of such divestitures; the determination and ability to successfully undertake business realignment activities and the expected costs, including cost savings, thereof; ability to implement successfully business and operating initiatives, including the timing, price and execution of share repurchases and other capital initiatives; availability, cost increases of or other limitations on our access to raw materials, component products and/or commodities if associated costs cannot be recovered in product pricing; ability to manage costs related to insurance and employee retirement and health care benefits; legal and regulatory developments and other government actions, including related to environmental protection, and associated compliance costs; supply chain and labor disruptions, including as a result of tariffs and labor shortages; threats associated with international conflicts and cybersecurity risks and risks associated with protecting our intellectual property; uncertainties surrounding the ultimate resolution of outstanding legal proceedings, including the outcome of any appeals; effects on market conditions, including sales and pricing, resulting from global reactions to U.S. trade policies; manufacturing activity, air travel trends, currency exchange rates, difficulties entering new markets and economic conditions such as inflation, deflation, interest rates and credit availability; inability to obtain, or meet conditions imposed for, required governmental and regulatory approvals; changes in the tax laws in the United States and foreign jurisdictions and judicial or regulatory interpretations thereof; and large scale disasters, such as floods, earthquakes, hurricanes, industrial accidents and pandemics. Readers should also consider forward-looking statements in light of risk factors discussed in Parker’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and other periodic filings made with the SEC.

    CONSOLIDATED STATEMENT OF INCOME
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands, except per share amounts)   2024       2023       2024       2023  
    Net sales $ 4,742,593     $ 4,820,947     $ 9,646,577     $ 9,668,435  
    Cost of sales   3,022,229       3,101,962       6,119,948       6,199,311  
    Selling, general and administrative expenses   782,421       806,802       1,631,210       1,680,493  
    Interest expense   100,802       129,029       213,893       263,497  
    Other income, net   (328,716 )     (85,011 )     (359,517 )     (163,466 )
    Income before income taxes   1,165,857       868,165       2,041,043       1,688,600  
    Income taxes   217,208       186,108       393,866       355,471  
    Net income   948,649       682,057       1,647,177       1,333,129  
    Less: Noncontrolling interests   107       206       215       451  
    Net income attributable to common shareholders $ 948,542     $ 681,851     $ 1,646,962     $ 1,332,678  
                   
    Earnings per share attributable to common shareholders:              
    Basic earnings per share $ 7.37     $ 5.31     $ 12.80     $ 10.38  
    Diluted earnings per share $ 7.25     $ 5.23     $ 12.60     $ 10.23  
                   
    Average shares outstanding during period – Basic   128,752,836       128,426,247       128,707,962       128,449,398  
    Average shares outstanding during period – Diluted   130,758,808       130,367,351       130,716,482       130,314,326  
                   
                   
    CASH DIVIDENDS PER COMMON SHARE              
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Amounts in dollars)   2024       2023       2024       2023  
    Cash dividends per common share $ 1.63     $ 1.48     $ 3.26     $ 2.96  
                   
    RECONCILIATION OF ORGANIC GROWTH
    (Unaudited) Three Months Ended
      As Reported           Adjusted
      December 31, 2024   Currency   Divestitures   December 31, 2024
    Diversified Industrial Segment   (7.4 )%     (1.3 )%     (1.9 )%     (4.2 )%
    Aerospace Systems Segment   14.0 %     — %     — %     14.0 %
    Total   (1.6 )%     (0.9 )%     (1.4 )%     0.7 %
                   
    (Unaudited) Six Months Ended
      As Reported           Adjusted
      December 31, 2024   Currency   Divestitures   December 31, 2024
    Diversified Industrial Segment   (5.9 )%     (0.8 )%     (1.0 )%     (4.1 )%
    Aerospace Systems Segment   15.9 %     0.3 %     — %     15.6 %
    Total   (0.2 )%     (0.5 )%     (0.8 )%     1.1 %
    RECONCILIATION OF NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS TO ADJUSTED NET INCOME ATTRIBUTABLE TO COMMON SHAREHOLDERS
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands)   2024       2023       2024       2023  
    Net income attributable to common shareholders $ 948,542     $ 681,851     $ 1,646,962     $ 1,332,678  
    Adjustments:              
    Acquired intangible asset amortization expense   138,126       142,027       278,247       297,547  
    Business realignment charges   20,855       14,354       30,361       27,446  
    Integration costs to achieve   6,893       10,014       13,304       16,420  
    Gain on sale of building   —       —       (10,461 )     —  
    Gain on divestitures   (249,748 )     (12,391 )     (249,748 )     (25,651 )
    Tax effect of adjustments1   (11,437 )     (33,476 )     (45,648 )     (69,624 )
    Adjusted net income attributable to common shareholders $ 853,231     $ 802,379     $ 1,663,017     $ 1,578,816  
                   
    RECONCILIATION OF EARNINGS PER DILUTED SHARE TO ADJUSTED EARNINGS PER DILUTED SHARE
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Amounts in dollars)   2024       2023       2024       2023  
    Earnings per diluted share $ 7.25     $ 5.23     $ 12.60     $ 10.23  
    Adjustments:              
    Acquired intangible asset amortization expense   1.06       1.09       2.13       2.28  
    Business realignment charges   0.16       0.11       0.23       0.21  
    Integration costs to achieve   0.05       0.08       0.10       0.13  
    Gain on sale of building   —       —       (0.08 )     —  
    Gain on divestitures   (1.91 )     (0.10 )     (1.91 )     (0.20 )
    Tax effect of adjustments1   (0.08 )     (0.26 )     (0.33 )     (0.53 )
    Adjusted earnings per diluted share $ 6.53     $ 6.15     $ 12.74     $ 12.12  
                   
    1This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.
    BUSINESS SEGMENT INFORMATION              
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands)   2024       2023       2024       2023  
    Net sales              
    Diversified Industrial $ 3,252,806     $ 3,514,473     $ 6,708,964     $ 7,133,001  
    Aerospace Systems   1,489,787       1,306,474       2,937,613       2,535,434  
    Total net sales $ 4,742,593     $ 4,820,947     $ 9,646,577     $ 9,668,435  
    Segment operating income              
    Diversified Industrial $ 710,562     $ 752,334     $ 1,494,108     $ 1,559,088  
    Aerospace Systems   338,184       263,112       661,170       489,372  
    Total segment operating income   1,048,746       1,015,446       2,155,278       2,048,460  
    Corporate general and administrative expenses   56,264       49,902       105,058       105,558  
    Income before interest expense and other income, net   992,482       965,544       2,050,220       1,942,902  
    Interest expense   100,802       129,029       213,893       263,497  
    Other income, net   (274,177 )     (31,650 )     (204,716 )     (9,195 )
    Income before income taxes $ 1,165,857     $ 868,165     $ 2,041,043     $ 1,688,600  
    RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands)   2024       2023       2024       2023  
    Diversified Industrial Segment sales $ 3,252,806     $ 3,514,473     $ 6,708,964     $ 7,133,001  
                   
    Diversified Industrial Segment operating income $ 710,562     $ 752,334     $ 1,494,108     $ 1,559,088  
    Adjustments:              
    Acquired intangible asset amortization   62,570       67,309       127,834       135,260  
    Business realignment charges   19,343       13,285       28,243       25,924  
    Integration costs to achieve   627       871       1,405       2,010  
    Adjusted Diversified Industrial Segment operating income $ 793,102     $ 833,799     $ 1,651,590     $ 1,722,282  
                   
    Diversified Industrial Segment operating margin   21.8 %     21.4 %     22.3 %     21.9 %
    Adjusted Diversified Industrial Segment operating margin   24.4 %     23.7 %     24.6 %     24.1 %
                   
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands)   2024       2023       2024       2023  
    Aerospace Systems Segment sales $ 1,489,787     $ 1,306,474     $ 2,937,613     $ 2,535,434  
                   
    Aerospace Systems Segment operating income $ 338,184     $ 263,112     $ 661,170     $ 489,372  
    Adjustments:              
    Acquired intangible asset amortization   75,556       74,718       150,413       162,287  
    Business realignment charges   386       (123 )     394       330  
    Integration costs to achieve   6,266       9,143       11,899       14,410  
    Adjusted Aerospace Systems Segment operating income $ 420,392     $ 346,850     $ 823,876     $ 666,399  
                   
    Aerospace Systems Segment operating margin   22.7 %     20.1 %     22.5 %     19.3 %
    Adjusted Aerospace Systems Segment operating margin   28.2 %     26.5 %     28.0 %     26.3 %
                   
    RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands)   2024       2023       2024       2023  
    Total net sales $ 4,742,593     $ 4,820,947     $ 9,646,577     $ 9,668,435  
                   
    Total segment operating income $ 1,048,746     $ 1,015,446     $ 2,155,278     $ 2,048,460  
    Adjustments:              
    Acquired intangible asset amortization   138,126       142,027       278,247       297,547  
    Business realignment charges   19,729       13,162       28,637       26,254  
    Integration costs to achieve   6,893       10,014       13,304       16,420  
    Adjusted total segment operating income $ 1,213,494     $ 1,180,649     $ 2,475,466     $ 2,388,681  
                   
    Total segment operating margin   22.1 %     21.1 %     22.3 %     21.2 %
    Adjusted total segment operating margin   25.6 %     24.5 %     25.7 %     24.7 %
    CONSOLIDATED BALANCE SHEET      
    (Unaudited) December 31,   June 30,
    (Dollars in thousands)   2024       2024  
    Assets      
    Current assets:      
    Cash and cash equivalents $ 395,507     $ 422,027  
    Trade accounts receivable, net   2,445,845       2,865,546  
    Non-trade and notes receivable   304,829       331,429  
    Inventories   2,806,983       2,786,800  
    Prepaid expenses   246,467       252,618  
    Other current assets   148,831       140,204  
    Total current assets   6,348,462       6,798,624  
    Property, plant and equipment, net   2,800,992       2,875,668  
    Deferred income taxes   87,400       92,704  
    Investments and other assets   1,232,636       1,207,232  
    Intangible assets, net   7,444,670       7,816,181  
    Goodwill   10,357,303       10,507,433  
    Total assets $ 28,271,463     $ 29,297,842  
           
    Liabilities and equity      
    Current liabilities:      
    Notes payable and long-term debt payable within one year $ 2,373,286     $ 3,403,065  
    Accounts payable, trade   1,794,884       1,991,639  
    Accrued payrolls and other compensation   420,477       581,251  
    Accrued domestic and foreign taxes   364,143       354,659  
    Other accrued liabilities   1,034,501       982,695  
    Total current liabilities   5,987,291       7,313,309  
    Long-term debt   6,667,955       7,157,034  
    Pensions and other postretirement benefits   409,873       437,490  
    Deferred income taxes   1,394,882       1,583,923  
    Other liabilities   684,401       725,193  
    Shareholders’ equity   13,118,553       12,071,972  
    Noncontrolling interests   8,508       8,921  
    Total liabilities and equity $ 28,271,463     $ 29,297,842  
    CONSOLIDATED STATEMENT OF CASH FLOWS      
      Six Months Ended
    (Unaudited) December 31,
    (Dollars in thousands)   2024       2023  
    Cash flows from operating activities:      
    Net income $ 1,647,177     $ 1,333,129  
    Depreciation and amortization   454,869       468,165  
    Stock incentive plan compensation   106,472       108,061  
    Gain on sale of businesses   (250,373 )     (25,964 )
    (Gain) loss on property, plant and equipment and intangible assets   (6,975 )     5,097  
    Net change in receivables, inventories and trade payables   70,981       (42,804 )
    Net change in other assets and liabilities   (405,002 )     (407,366 )
    Other, net   61,584       (86,331 )
    Net cash provided by operating activities   1,678,733       1,351,987  
    Cash flows from investing activities:      
    Capital expenditures   (216,493 )     (204,117 )
    Proceeds from sale of property, plant and equipment   13,259       1,360  
    Proceeds from sale of businesses   622,182       74,595  
    Other, net   (6,941 )     (2,954 )
    Net cash provided by (used in) investing activities   412,007       (131,116 )
    Cash flows from financing activities:      
    Net payments for common stock activity   (189,681 )     (136,394 )
    Acquisition of noncontrolling interests   —       (2,883 )
    Net payments for debt   (1,494,484 )     (784,847 )
    Dividends paid   (420,061 )     (381,115 )
    Net cash used in financing activities   (2,104,226 )     (1,305,239 )
    Effect of exchange rate changes on cash   (13,034 )     (7,999 )
    Net decrease in cash and cash equivalents   (26,520 )     (92,367 )
    Cash and cash equivalents at beginning of year   422,027       475,182  
    Cash and cash equivalents at end of period $ 395,507     $ 382,815  
           
    RECONCILIATION OF FORECASTED ORGANIC GROWTH  
    (Unaudited)  
    (Amounts in percentages) Fiscal Year 2025
    Forecasted net sales (2%) to 1%
    Adjustments:  
    Currency 1.0%
    Divestitures 1.5%
    Adjusted forecasted net sales 0.5% to 3.5%
       
    RECONCILIATION OF FORECASTED SEGMENT OPERATING MARGIN TO ADJUSTED FORECASTED SEGMENT OPERATING MARGIN
       
    (Unaudited)  
    (Amounts in percentages) Fiscal Year 2025
    Forecasted segment operating margin ~ 22.7%
    Adjustments:  
    Business realignment charges 0.2%
    Costs to achieve 0.1%
    Acquisition-related intangible asset amortization expense 2.8%
    Adjusted forecasted segment operating margin ~ 25.8%
       
     
    RECONCILIATION OF FORECASTED EARNINGS PER DILUTED SHARE TO ADJUSTED FORECASTED EARNINGS PER DILUTED SHARE
       
    (Unaudited)  
    (Amounts in dollars) Fiscal Year 2025
    Forecasted earnings per diluted share $24.46 to $25.06
    Adjustments:  
    Business realignment charges 0.39
    Costs to achieve 0.15
    Acquisition-related intangible asset amortization expense 4.22
    Net gain on divestitures (1.91)
    Gain on sale of building (0.08)
    Tax effect of adjustments1 (0.83)
    Adjusted forecasted earnings per diluted share $26.40 to $27.00
       
       
    1This line item reflects the aggregate tax effect of all non-tax adjustments reflected in the preceding line items of the table. We estimate the tax effect of each adjustment item by applying our overall effective tax rate for continuing operations to the pre-tax amount, unless the nature of the item and/or the tax jurisdiction in which the item has been recorded requires application of a specific tax rate or tax treatment, in which case the tax effect of such item is estimated by applying such specific tax rate or tax treatment.
       
    Note: Totals may not foot due to rounding
    SUPPLEMENTAL INFORMATION
                   
    BUSINESS SEGMENT INFORMATION              
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands)   2024       2023       2024       2023  
    Net sales              
    Diversified Industrial:              
    North America businesses $ 1,928,008     $ 2,110,203     $ 4,028,332     $ 4,340,109  
    International businesses   1,324,798       1,404,270       2,680,632       2,792,892  
                   
    Segment operating income              
    Diversified Industrial:              
    North America businesses $ 426,567     $ 461,850     $ 911,130     $ 967,903  
    International businesses   283,995       290,484       582,978       591,185  
    RECONCILIATION OF ORGANIC GROWTH            
    (Unaudited) Three Months Ended
      As Reported               Adjusted
      December 31, 2024     Currency     Divestitures   December 31, 2024
    Diversified Industrial Segment:                          
    North America businesses   (8.6 )%     (0.4 )%     (3.2 )%     (5.0 )%
    International businesses   (5.7 )%     (2.7 )%     — %     (3.0 )%
                               
    (Unaudited) Six Months Ended
        As Reported                   Adjusted  
        December 31, 2024       Currency     Divestitures     December 31, 2024  
    Diversified Industrial Segment:                          
    North America businesses   (7.2 )%     (0.5 )%     (1.7 )%     (5.0 )%
    International businesses   (4.0 )%     (1.3 )%     — %     (2.7 )%
    RECONCILIATION OF SEGMENT OPERATING MARGINS TO ADJUSTED SEGMENT OPERATING MARGINS
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands)   2024       2023       2024       2023  
    Diversified Industrial Segment:              
    North America businesses sales $ 1,928,008     $ 2,110,203     $ 4,028,332     $ 4,340,109  
                   
    North America businesses operating income $ 426,567     $ 461,850     $ 911,130     $ 967,903  
    Adjustments:              
    Acquired intangible asset amortization   40,985       44,699       83,960       89,382  
    Business realignment charges   5,444       3,250       8,888       5,834  
    Integration costs to achieve   445       562       1,050       1,507  
    Adjusted North America businesses operating income $ 473,441     $ 510,361     $ 1,005,028     $ 1,064,626  
                   
    North America businesses operating margin   22.1 %     21.9 %     22.6 %     22.3 %
    Adjusted North America businesses operating margin   24.6 %     24.2 %     24.9 %     24.5 %
                   
      Three Months Ended   Six Months Ended
    (Unaudited) December 31,   December 31,
    (Dollars in thousands)   2024       2023       2024       2023  
    Diversified Industrial Segment:              
    International businesses sales $ 1,324,798     $ 1,404,270     $ 2,680,632     $ 2,792,892  
                   
    International businesses operating income $ 283,995     $ 290,484     $ 582,978     $ 591,185  
    Adjustments:              
    Acquired intangible asset amortization   21,585       22,610       43,874       45,878  
    Business realignment charges   13,899       10,035       19,355       20,090  
    Integration costs to achieve   182       309       355       503  
    Adjusted International businesses operating income $ 319,661     $ 323,438     $ 646,562     $ 657,656  
                   
    International businesses operating margin   21.4 %     20.7 %     21.7 %     21.2 %
    Adjusted International businesses operating margin   24.1 %     23.0 %     24.1 %     23.5 %

    The MIL Network –

  • MIL-OSI: Roper Technologies announces 2024 financial results

    Source: GlobeNewswire (MIL-OSI)

    SARASOTA, Fla., Jan. 30, 2025 (GLOBE NEWSWIRE) — Roper Technologies, Inc. (Nasdaq: ROP) reported financial results for the fourth quarter and full year ended December 31, 2024. The results in this press release are presented on a continuing operations basis.

    Fourth quarter 2024 highlights

    • Revenue increased 16% to $1.88 billion; acquisition contribution was +9% and organic revenue was +7%
    • Operating cash flow was $722 million; adjusted operating cash flow increased 13%
    • GAAP net earnings increased 22% to $462 million; adjusted net earnings increased 10% to $520 million
    • Adjusted EBITDA increased 13% to $744 million
    • GAAP DEPS increased 22% to $4.28; adjusted DEPS increased 10% to $4.81

    Full year 2024 highlights

    • Revenue increased 14% to $7.04 billion; acquisition contribution was +8% and organic revenue was +6%
    • Operating cash flow was $2.39 billion; adjusted operating cash flow increased 16%
    • GAAP net earnings increased 13% to $1.55 billion; adjusted net earnings increased 10% to $1.98 billion
    • Adjusted EBITDA increased 13% to $2.83 billion
    • GAAP DEPS increased 13% to $14.35; adjusted DEPS increased 10% to $18.31

    “It was an outstanding year for Roper’s long-term cash flow compounding model. We grew free cash flow 16% to $2.3 billion, surpassing the $2 billion milestone for the first time in our history,” said Neil Hunn, Roper Technologies’ President and CEO. “Our total revenue growth of 14% for the year was driven by 6% organic growth and an 8% contribution from our disciplined and process-driven capital deployment capability. To this end, we deployed $3.6 billion of capital toward high-quality vertical software acquisitions, highlighted by Procare Solutions, a leading early childhood education software company, and Transact Campus, which was successfully combined with our CBORD education & healthcare software business.”

    2025 outlook and guidance

    “Roper not only grew substantially in 2024, but we enter 2025 as a fundamentally better company. This past year, we upgraded key leadership talent, expanded our capital deployment function, and advanced our operating model. As a result, we are entering 2025 with broad-based and positive momentum. Our double-digit 2025 total revenue growth outlook is fueled by improving organic growth and meaningful contributions from our 2024 acquisitions. We believe these growth trends, combined with our significant M&A firepower and large pipeline of attractive acquisition opportunities, position Roper well to continue delivering compelling long-term cash flow compounding for our shareholders,” concluded Mr. Hunn.

    Roper expects full year 2025 adjusted DEPS of $19.75 – $20.00 with first quarter adjusted DEPS of $4.70 – $4.74. The Company expects full year total revenue growth of 10%+, with organic revenue growth of +6 – 7%.

    The Company’s guidance excludes the impact of unannounced future acquisitions or divestitures.

    Conference call to be held at 8:00 AM (ET) today

    A conference call to discuss these results has been scheduled for 8:00 AM ET on Thursday, January 30, 2025. The call can be accessed via webcast or by dialing +1 800-836-8184 (US/Canada) or +1 646-357-8785, using conference call ID 30275. Webcast information and conference call materials will be made available in the Investors section of Roper’s website (www.ropertech.com) prior to the start of the call. The webcast can also be accessed directly by using the following URL https://event.webcast. Telephonic replays will be available for up to two weeks and can be accessed by dialing +1 646-517-4150 with access code 30275#.

    Use of non-GAAP financial information

    The Company supplements its consolidated financial statements presented on a GAAP basis with certain non-GAAP financial information to provide investors with greater insight, increase transparency and allow for a more comprehensive understanding of the information used by management in its financial and operational decision-making. Reconciliation of non-GAAP measures to their most directly comparable GAAP measures are included in the accompanying financial schedules or tables. The non-GAAP financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures prepared in accordance with GAAP, and the financial results prepared in accordance with GAAP and reconciliations from these results should be carefully evaluated.

    Minority interests

    Following the sale of a majority stake in its industrial businesses to CD&R, Roper holds a minority interest in Indicor. The fair value of Roper’s equity investment in Indicor is updated on a quarterly basis and reported as “equity investments gain, net.” During the quarter, Roper sold its minority interest in Certinia and recognized the associated gain within “equity investments gain, net.” Roper makes non-GAAP adjustments for the impacts associated with these investments.

    Table 1: Revenue and adjusted EBITDA reconciliation ($M)
    (from continuing operations)
      Q4 2023   Q4 2024   V %   FY 2023   FY 2024   V %
    GAAP revenue $ 1,613     $ 1,877       16 %   $ 6,178     $ 7,039       14 %
                           
    Components of revenue growth                      
    Organic           7 %             6 %
    Acquisitions           9 %             8 %
    Foreign exchange           — %             — %
    Revenue growth           16 %             14 %
                           
    Adjusted EBITDA reconciliation                      
    GAAP net earnings $ 378     $ 462         $ 1,368     $ 1,549      
    Taxes   99       128           375       418      
    Interest expense   50       71           165       259      
    Depreciation   9       9           35       37      
    Amortization   187       202           720       776      
    EBITDA $ 723     $ 873       21 %   $ 2,663     $ 3,039       14 %
                           
    Restructuring-related expenses associated with the Syntellis (’23) and Transact (’24) acquisitions   —       —           9       9      
    Transaction-related expenses for completed acquisitions   3       1           8       8      
    Financial impacts associated with the minority investments in Indicor & CertiniaA   (67 )     (141 )         (165 )     (235 )    
    Gain on sale of non-operating assets   —       —           (3 )     —      
    Legal settlement charge   —       11           —       11      
    Adjusted EBITDA $ 659     $ 744      13 %   $ 2,511     $ 2,832       13 %
    % of revenue   40.8 %     39.6 %    (120 bps )     40.6 %     40.2 %     (40 bps )
    Table 2: Adjusted net earnings reconciliation ($M)
    (from continuing operations)
      Q4 2023   Q4 2024   V %   FY 2023   FY 2024   V %
    GAAP net earnings $ 378     $ 462       22 %   $ 1,368     $ 1,549       13 %
    Restructuring-related expenses associated with the Syntellis (’23) and Transact (’24) acquisitions   —       —           7       7      
    Transaction-related expenses for completed acquisitions   2       1           6       6      
    Financial impacts associated with the minority investments in Indicor & CertiniaA   (52 )     (105 )         (135 )     (182 )    
    Gain on sale of non-operating assets   —       —           (3 )     —      
    Legal settlement charge   —       9           —       9      
    Amortization of acquisition-related
    intangible assetsB    		   143       153           552       588      
    Adjusted net earningsC $ 471     $ 520       10 %   $ 1,795     $ 1,978       10 %
    Table 3: Adjusted DEPS reconciliation
    (from continuing operations)
      Q4 2023   Q4 2024   V %   FY 2023   FY 2024   V %
    GAAP DEPS $ 3.50     $ 4.28       22 %   $ 12.74     $ 14.35       13 %
    Restructuring-related expenses associated with the Syntellis (’23) and Transact (’24) acquisitions   —       —           0.06       0.07      
    Transaction-related expenses for completed acquisitions   0.02       0.01           0.06       0.06      
    Financial impacts associated with the minority investments in Indicor & CertiniaA   (0.48 )     (0.97 )         (1.25 )     (1.68 )    
    Gain on sale of non-operating assets   —       —           (0.02 )     —      
    Legal settlement charge   —       0.08           —       0.08      
    Amortization of acquisition-related intangible assetsB   1.33       1.41           5.13       5.45      
    Adjusted DEPSC $ 4.37     $ 4.81       10 %   $ 16.71     $ 18.31       10 %
    Table 4: Adjusted cash flow reconciliation ($M)
    (from continuing operations)
      Q4 2023   Q4 2024   V %   FY 2023   FY 2024   V %
    Operating cash flow $ 622     $ 722       16 %   $ 2,037     $ 2,393       17 %
    Taxes paid in period related to divestiture   16       —           32       —      
    Adjusted operating cash flow $ 638     $ 722       13 %   $ 2,070     $ 2,393       16 %
    Capital expenditures   (30 )     (27 )         (68 )     (66 )    
    Capitalized software expenditures   (11 )     (12 )         (40 )     (45 )    
    Adjusted free cash flow $ 596     $ 684       15 %   $ 1,962     $ 2,282       16 %
    Table 5: Forecasted adjusted DEPS reconciliation
    (from continuing operations)
      Q1 2025   FY 2025
      Low End   High End   Low End   High End
    GAAP DEPSD $ 3.29     $ 3.33     $ 14.21     $ 14.46  
    Financial impacts associated with the minority investment in IndicorA   TBD       TBD       TBD       TBD  
    Amortization of acquisition-related intangible assetsB   1.41       1.41       5.54       5.54  
    Adjusted DEPSC $ 4.70     $ 4.74     $ 19.75     $ 20.00  

    Footnotes:

    A. Adjustments related to the financial impacts associated with the minority investments in Indicor & Certinia as shown below ($M, except per share data). Forecasted results do not include any potential impacts associated with our minority investment in Indicor, as these potential impacts cannot be reasonably predicted. These impacts will be excluded from all non-GAAP results in future periods.
                                 
        Q4 2023A   Q4 2024A     FY 2023A   FY 2024A     Q1 2025E   FY 2025E
      Pretax $ (67 )   $ (141 )     $ (165 )   $ (235 )     TBD   TBD
      After-tax $ (52 )   $ (105 )     $ (135 )   $ (182 )     TBD   TBD
      Per share $ (0.48 )   $ (0.97 )     $ (1.25 )   $ (1.68 )     TBD   TBD
                                 
    B. Actual results and forecast of estimated amortization of acquisition-related intangible assets as shown below ($M, except per share data).
                                 
        Q4 2023A   Q4 2024A     FY 2023A   FY 2024A     Q1 2025E   FY 2025E
      Pretax $ 181     $ 193       $ 698     $ 745       $ 193   $ 762
      After-tax $ 143     $ 153       $ 552     $ 588       $ 153   $ 602
      Per share $ 1.33     $ 1.41       $ 5.13     $ 5.45       $ 1.41   $ 5.54
                                 
    C. All actual and forecasted non-GAAP adjustments are taxed at 21% with the exception of the financial impacts associated with minority investments.
                                 
    D. Forecasted GAAP DEPS do not include any potential impacts associated with our minority investment in Indicor. These impacts will be excluded from all non-GAAP results in future periods.
       

    Note: Numbers may not foot due to rounding.

    About Roper Technologies

    Roper Technologies is a constituent of the Nasdaq 100, S&P 500, and Fortune 1000. Roper has a proven, long-term track record of compounding cash flow and shareholder value. The Company operates market leading businesses that design and develop vertical software and technology enabled products for a variety of defensible niche markets. Roper utilizes a disciplined, analytical, and process-driven approach to redeploy its excess capital toward high-quality acquisitions. Additional information about Roper is available on the Company’s website at www.ropertech.com.

    Contact information:
    Investor Relations
    941-556-2601
    investor-relations@ropertech.com

    The information provided in this press release contains forward-looking statements within the meaning of the federal securities laws. These forward-looking statements may include, among others, statements regarding operating results, the success of our internal operating plans, and the prospects for newly acquired businesses to be integrated and contribute to future growth, profit and cash flow expectations. Forward-looking statements may be indicated by words or phrases such as “anticipate,” “estimate,” “plans,” “expects,” “projects,” “should,” “will,” “believes,” “intends” and similar words and phrases. These statements reflect management’s current beliefs and are not guarantees of future performance. They involve risks and uncertainties that could cause actual results to differ materially from those contained in any forward-looking statement. Such risks and uncertainties include our ability to identify and complete acquisitions consistent with our business strategies, integrate acquisitions that have been completed, realize expected benefits and synergies from, and manage other risks associated with, acquired businesses, including obtaining any required regulatory approvals with respect thereto. We also face other general risks, including our ability to realize cost savings from our operating initiatives, general economic conditions and the conditions of the specific markets in which we operate, including risks related to labor shortages and rising interest rates, changes in foreign exchange rates, risks related to changing U.S. and foreign trade policies, including increased trade restrictions or tariffs, risks associated with our international operations, cybersecurity and data privacy risks, including litigation resulting therefrom, risks related to political instability, armed hostilities, incidents of terrorism, public health crises (such as the COVID-19 pandemic) or natural disasters, increased product liability and insurance costs, increased warranty exposure, future competition, changes in the supply of, or price for, parts and components, including as a result of inflation and potential supply chain constraints, environmental compliance costs and liabilities, risks and cost associated with litigation, potential write-offs of our substantial intangible assets, and risks associated with obtaining governmental approvals and maintaining regulatory compliance for new and existing products. Important risks may be discussed in current and subsequent filings with the SEC. You should not place undue reliance on any forward-looking statements. These statements speak only as of the date they are made, and we undertake no obligation to update publicly any of them in light of new information or future events.

     

    Roper Technologies, Inc.      
    Condensed Consolidated Balance Sheets (unaudited)
    (Amounts in millions)      
           
      December 31, 2024   December 31, 2023
    ASSETS:      
           
    Cash and cash equivalents $ 188.2     $ 214.3  
    Accounts receivable, net   885.1       829.9  
    Inventories, net   120.8       118.6  
    Income taxes receivable   25.6       47.7  
    Unbilled receivables   127.3       106.4  
    Prepaid expenses and other current assets   195.7       164.5  
    Total current assets   1,542.7       1,481.4  
           
    Property, plant and equipment, net   149.7       119.6  
    Goodwill   19,312.9       17,118.8  
    Other intangible assets, net   9,059.6       8,212.1  
    Deferred taxes   54.1       32.2  
    Equity investments   772.3       795.7  
    Other assets   443.4       407.7  
    Total assets $ 31,334.7     $ 28,167.5  
           
    LIABILITIES AND STOCKHOLDERS’ EQUITY:      
           
    Accounts payable $ 148.1     $ 143.0  
    Accrued compensation   289.0       250.0  
    Deferred revenue   1,737.4       1,583.8  
    Other accrued liabilities   546.2       446.5  
    Income taxes payable   68.4       40.4  
    Current portion of long-term debt, net   1,043.1       499.5  
    Total current liabilities   3,832.2       2,963.2  
           
    Long-term debt, net of current portion   6,579.9       5,830.6  
    Deferred taxes   1,630.6       1,513.1  
    Other liabilities   424.4       415.8  
    Total liabilities   12,467.1       10,722.7  
           
    Common stock   1.1       1.1  
    Additional paid-in capital   3,014.6       2,767.0  
    Retained earnings   16,034.9       14,816.3  
    Accumulated other comprehensive loss   (166.5 )     (122.8 )
    Treasury stock   (16.5 )     (16.8 )
    Total stockholders’ equity   18,867.6       17,444.8  
    Total liabilities and stockholders’ equity $ 31,334.7     $ 28,167.5  
           
    Roper Technologies, Inc.          
    Condensed Consolidated Statements of Earnings (unaudited)
    (Amounts in millions, except per share data)
                   
      Three months ended December 31,   Year ended December 31,
        2024       2023       2024       2023  
    Net revenues $ 1,877.1     $ 1,613.5     $ 7,039.2     $ 6,177.8  
    Cost of sales   594.8       488.3       2,160.9       1,870.6  
    Gross profit   1,282.3       1,125.2       4,878.3       4,307.2  
                   
    Selling, general and administrative expenses   757.6       662.4       2,881.5       2,562.0  
    Income from operations   524.7       462.8       1,996.8       1,745.2  
                   
    Interest expense, net   70.8       50.1       259.2       164.7  
    Equity investments gain, net   (141.0 )     (66.7 )     (234.6 )     (165.4 )
    Other expense, net   4.1       2.7       5.0       2.8  
                   
    Earnings before income taxes   590.8       476.7       1,967.2       1,743.1  
                   
    Income taxes   128.5       99.2       417.9       374.7  
                   
    Net earnings from continuing operations   462.3       377.5       1,549.3       1,368.4  
                   
    Loss from discontinued operations, net of tax   —       —       —       (4.1 )
    Gain on disposition of discontinued operations, net of tax   —       11.5       —       19.9  
    Net earnings from discontinued operations   —       11.5       —       15.8  
                   
    Net earnings $ 462.3     $ 389.0     $ 1,549.3     $ 1,384.2  
                   
    Net earnings per share from continuing operations:              
    Basic $ 4.31     $ 3.53     $ 14.47     $ 12.83  
    Diluted $ 4.28     $ 3.50     $ 14.35     $ 12.74  
                   
    Net earnings per share from discontinued operations:              
    Basic $ —     $ 0.11     $ —     $ 0.15  
    Diluted $ —     $ 0.11     $ —     $ 0.15  
                   
    Net earnings per share:              
    Basic $ 4.31     $ 3.64     $ 14.47     $ 12.98  
    Diluted $ 4.28     $ 3.61     $ 14.35     $ 12.89  
                   
    Weighted average common shares outstanding:              
    Basic   107.3       106.9       107.1       106.6  
    Diluted   108.1       107.7       108.0       107.4  
    Roper Technologies, Inc.            
    Selected Segment Financial Data (unaudited)            
    (Amounts in millions; percentages of net revenues)            
                                   
      Three months ended December 31,   Year ended December 31,
        2024       2023       2024       2023  
      Amount   %   Amount   %   Amount   %   Amount   %
    Net revenues:                              
    Application Software $ 1,056.9         $ 851.8         $ 3,868.3         $ 3,186.9      
    Network Software   373.5           362.7           1,475.6           1,439.4      
    Technology Enabled Products   446.7           399.0           1,695.3           1,551.5      
    Total $ 1,877.1         $ 1,613.5         $ 7,039.2         $ 6,177.8      
                                   
                                   
    Gross profit:                              
    Application Software $ 708.0       67.0 %   $ 586.6       68.9 %   $ 2,647.6       68.4 %   $ 2,195.8       68.9 %
    Network Software   318.9       85.4 %     311.6       85.9 %     1,254.8       85.0 %     1,225.6       85.1 %
    Technology Enabled Products   255.4       57.2 %     227.0       56.9 %     975.9       57.6 %     885.8       57.1 %
    Total $ 1,282.3       68.3 %   $ 1,125.2       69.7 %   $ 4,878.3       69.3 %   $ 4,307.2       69.7 %
                                   
                                   
    Operating profit*:                              
    Application Software $ 272.9       25.8 %   $ 219.5       25.8 %   $ 1,023.4       26.5 %   $ 820.8       25.8 %
    Network Software   174.4       46.7 %     167.4       46.2 %     666.5       45.2 %     632.4       43.9 %
    Technology Enabled Products   150.3       33.6 %     127.0       31.8 %     574.3       33.9 %     518.7       33.4 %
    Total $ 597.6       31.8 %   $ 513.9       31.9 %   $ 2,264.2       32.2 %   $ 1,971.9       31.9 %
                                   
                                   
    * Segment operating profit is before unallocated corporate general and administrative expenses and enterprise-wide stock-based compensation. These expenses were $72.9 and $51.1 for the three months ended December 31, 2024 and 2023, respectively, and $267.4 and $226.7 for the twelve months ended December 31, 2024 and 2023, respectively.
    Roper Technologies, Inc.  
    Condensed Consolidated Statements of Cash Flows (unaudited)
    (Amounts in millions)      
      Year ended December 31,
        2024       2023  
    Cash flows from operating activities:      
    Net earnings from continuing operations $ 1,549.3     $ 1,368.4  
    Adjustments to reconcile net earnings from continuing operations to cash flows from operating activities:      
    Depreciation and amortization of property, plant and equipment   37.1       35.4  
    Amortization of intangible assets   775.7       719.8  
    Amortization of deferred financing costs   9.8       9.9  
    Non-cash stock compensation   145.9       123.5  
    Equity investments gain, net   (234.6 )     (165.4 )
    Income tax provision   417.9       374.7  
    Changes in operating assets and liabilities, net of acquired businesses:      
    Accounts receivable   14.4       (50.2 )
    Unbilled receivables   (18.5 )     (7.5 )
    Inventories   (1.9 )     (6.6 )
    Prepaid expenses and other current assets   (19.5 )     (4.3 )
    Accounts payable   (13.0 )     18.2  
    Other accrued liabilities   109.3       (1.0 )
    Deferred revenue   110.7       93.9  
    Cash taxes paid for gain on disposal of business   —       (32.5 )
    Cash income taxes paid, excluding tax associated with gain on disposal of business   (483.8 )     (423.4 )
    Other, net   (5.6 )     (15.5 )
    Cash provided by operating activities from continuing operations   2,393.2       2,037.4  
    Cash used in operating activities from discontinued operations   —       (2.3 )
    Cash provided by operating activities   2,393.2       2,035.1  
           
    Cash flows from (used in) investing activities:      
    Acquisitions of businesses, net of cash acquired   (3,612.9 )     (2,052.7 )
    Capital expenditures   (66.0 )     (68.0 )
    Capitalized software expenditures   (45.0 )     (40.0 )
    Distributions from equity investment   10.8       32.5  
    Proceeds from sale of equity investment   245.6       —  
    Other, net   (1.0 )     (0.1 )
    Cash used in investing activities from continuing operations   (3,468.5 )     (2,128.3 )
    Cash provided by disposition of discontinued operations   —       2.0  
    Cash used in investing activities   (3,468.5 )     (2,126.3 )
           
    Cash flows from (used in) financing activities:      
    Proceeds from senior notes   2,000.0       —  
    Payments of senior notes   (500.0 )     (700.0 )
    Borrowings (payments) under revolving line of credit, net   (235.0 )     360.0  
    Debt issuance costs   (24.6 )     —  
    Cash dividends to stockholders   (321.9 )     (290.2 )
    Treasury stock sales   18.5       15.5  
    Proceeds from stock-based compensation, net   88.6       115.2  
    Other, net   43.9       —  
    Cash provided by (used in) financing activities   1,069.5       (499.5 )
           
    (Continued)
    Roper Technologies, Inc.  
    Condensed Consolidated Statements of Cash Flows (unaudited) – Continued
    (Amounts in millions)      
      Year ended December 31,
        2024       2023  
    Effect of exchange rate changes on cash   (20.3 )     12.2  
           
    Net decrease in cash and cash equivalents   (26.1 )     (578.5 )
           
    Cash and cash equivalents, beginning of year   214.3       792.8  
           
    Cash and cash equivalents, end of year $ 188.2     $ 214.3  
           

    The MIL Network –

  • MIL-OSI: Connectone Bancorp, Inc. Reports Fourth Quarter and Full-Year 2024 Results; Declares Common and Preferred Dividends

    Source: GlobeNewswire (MIL-OSI)

    ENGLEWOOD CLIFFS, N.J., Jan. 30, 2025 (GLOBE NEWSWIRE) — ConnectOne Bancorp, Inc. (Nasdaq: CNOB) (the “Company” or “ConnectOne”), parent company of ConnectOne Bank (the “Bank”), today reported net income available to common stockholders of $18.9 million for the fourth quarter of 2024 compared with $15.7 million for the third quarter of 2024 and $17.8 million for the fourth quarter of 2023. Diluted earnings per share were $0.49 for the fourth quarter of 2024 compared with $0.41 for the third quarter of 2024 and $0.46 for the fourth quarter of 2023. Full-year 2024 net income available to common stockholders was $67.8 million, compared to $81.0 million for the full-year 2023. Diluted earnings per share for the full-year 2024 were $1.76, compared with $2.07 for the full-year 2023. Return on average assets was 0.84%, 0.70% and 0.79% for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively. Return on average tangible common equity was 8.27%, 6.93% and 8.18% for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively.

    Operating net income available to common stockholders, which excludes non-operating items, as set forth in the reconciliation of GAAP earnings to operating earnings included in the supplemental table attached hereto, was $20.2 million for the fourth quarter of 2024, $16.1 million for the third quarter of 2024 and $19.1 million for the fourth quarter of 2023. Operating diluted earnings per share were $0.52 for the fourth quarter of 2024, $0.42 for the third quarter of 2024 and $0.49 for the fourth quarter of 2023. Operating return on average assets was 0.90%, 0.72% and 0.84% for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively. Operating return on average tangible common equity was 8.77%, 7.03% and 8.67% for the three months ended December 31, 2024, September 30, 2024 and December 31, 2023, respectively.

    “I’m extremely pleased with ConnectOne’s fourth quarter 2024 financial results highlighted by a 20.5% quarter-over-quarter and an 6.2% year-over-year increase in quarterly net income available to common stockholders, significant margin expansion and growth in both loans and core deposits,” stated Frank Sorrentino, ConnectOne’s Chairman and Chief Executive Officer. “On a quarter-over-quarter basis, our loan portfolio grew by 2.0% while core deposits grew by 3.2%. The bank’s net interest margin improved by nearly 20 basis-points, benefiting from a more than 25 basis-point improvement in our cost of deposits. This improvement reflects an approximately 40% cycle-to-date beta on interest-bearing deposits and a 3.6% sequential quarterly increase in average noninterest-bearing demand deposits. Moreover, credit quality trends remain stable and, once again, tangible book value advanced despite higher longer-term interest rates.”

    “As we move into 2025, we are experiencing strong operating momentum bolstered by improving industry fundamentals, favorable economic conditions, and a potentially more supportive regulatory environment. Importantly, the proposed merger with The First of Long Island Corporation is moving forward as planned. We’re well along in the merger process and anticipate the transaction to close in the second quarter of 2025.” Mr. Sorrentino added, “The strategic rationale behind this financially attractive transaction remains highly compelling, which will meaningfully enhance ConnectOne’s presence on Long Island and further our position as a premier New York Metro community bank. We are equally excited about the opportunity to serve The First of Long Island’s clients and to leverage the expertise of its team, creating a significantly enhanced platform for sustained growth at ConnectOne.”

    Mr. Sorrentino concluded “Looking ahead, we remain focused and committed to our client-first culture and relationship banking model and are well-positioned to grow and strengthen our valuable franchise.”

    Dividend Declarations

    The Company announced that its Board of Directors declared a cash dividend on both its common stock and its outstanding preferred stock. A cash dividend on common stock of $0.18 per share will be paid on March 3, 2025, to common stockholders of record on February 18, 2025. A dividend of $0.328125 per depositary share, representing a 1/40th interest in a share of the Company’s 5.25% Fixed Rate Reset Non-Cumulative Perpetual Preferred Stock, Series A, will also be paid on March 3, 2025 to holders of record on February 18, 2025.

    Operating Results

    Fully taxable equivalent net interest income for the fourth quarter of 2024 was $64.7 million, an increase of $3.8 million, or 6.3%, from the third quarter of 2024, due to a 19 basis-point widening of the net interest margin to 2.86% from 2.67%. Average loans for the fourth quarter of 2024 remained essentially flat from the sequential third quarter, decreasing by $19.8 million, or 0.2%. The widening of the net interest margin was primarily due to a 27 basis-point decrease in the average costs of deposits, including noninterest-bearing deposits, partially offset by a 3 basis-point decline in the rate earned on interest-earning assets. The interest-earning asset rate for the fourth quarter of 2024 was strengthened by an increase in loan prepayment fees and recapture of nonaccrual loan interest. Excluding these aforementioned items, management estimates the net interest margin for the quarter would have been approximately 2.82%. The net interest margin, excluding any non-operating items, is expected to increase to more than 2.90% in the first quarter of 2025 as a result of further improvement in the cost of funds and the deployment of excess cash-on-hand.

    Fully taxable equivalent net interest income for the fourth quarter of 2024 increased by $3.0 million, or 4.7%, from the fourth quarter of 2023. The increase from the fourth quarter of 2023 resulted primarily from a 15 basis-point widening in the net interest margin to 2.86% from 2.71%, partially offset by a $164.7 million, or 2.0%, decrease in average loans. The widening of the net interest margin for the fourth quarter of 2024 when compared to the fourth quarter of 2023 was primarily due to a 102 basis-point decrease in the average cost of borrowings, a 9 basis-point decrease in average cost of deposits, including noninterest-bearing deposits, and a 3 basis-point increase in the loan portfolio yield, partially offset by an increase in average cash balances during the fourth quarter of 2024.

    Noninterest income was $3.7 million in the fourth quarter of 2024, $4.7 million in the third quarter of 2024 and $4.2 million in the fourth quarter of 2023. The $1.0 million decrease in noninterest income for the fourth quarter of 2024 when compared to the third quarter of 2024 was due to a $0.7 million decrease in net gains on equity securities, a $0.5 million decrease in BOLI income, primarily due to reduced death benefits, partially offset by a $0.2 million increase in net gains on sale of loans held-for-sale. The $0.5 million decrease in noninterest income for the fourth quarter of 2024 when compared to the fourth quarter of 2023 was due to a $0.9 million decrease in net gains on equity securities, partially offset a $0.3 million increase in other deposit, loan and other income and an increase in net gains on sale of loans held-for-sale of $0.1 million.

    Noninterest expenses were $38.5 million for the fourth quarter of 2024, $38.6 million for the third quarter of 2024 and $37.8 million for the fourth quarter of 2023. The $0.1 million decrease in noninterest expenses for the fourth quarter of 2024 when compared to the third quarter of 2024 was primarily due to a $0.7 million decrease in salaries and employee benefits, a $0.2 million decrease in other expenses, a $0.1 million decrease in marketing and advertising expenses and a $0.1 million decrease in occupancy and equipment expense, partially offset by a $0.5 million charge related to a branch closing, a $0.3 million increase in professional and consulting expenses, a $0.1 million increase in merger expenses and a $0.1 million increase in information and technology communications.

    The $0.7 million increase in noninterest expenses for the fourth quarter of 2024 when compared to the fourth quarter of 2023 was primarily due to a $0.9 million increase merger expenses, a $0.9 million increase in professional and consulting expenses, a $0.5 million increase in branch closing expenses, a $0.4 million increase in information technology and communications, a $0.2 million increase in salaries and employee benefits, a $0.1 million increase in marketing and advertising expenses and a $0.1 million increase in occupancy and equipment expenses, partially offset by decreases in FDIC insurance of $2.1 million and $0.3 million decrease in other expenses. The $0.9 million increase in merger expenses compared to the fourth quarter of 2023 was due to the planned merger with The First of Long Island Corporation. The $0.9 million increase in professional and consulting expenses was primarily due to increases in legal and audit accruals, as well as an increase in loan work-out expenses. The $0.5 million increase in branch closing expenses is due to the aforementioned branch closing. The $2.1 million decrease in FDIC insurance expense is due to the FDIC special assessment charge that was accrued during the fourth quarter of 2023.

    Income tax expense was $6.1 million for the fourth quarter of 2024, $6.0 million for the third quarter of 2024 and $6.2 million for the fourth quarter of 2023. The effective tax rates for the fourth quarter of 2024, third quarter of 2024 and fourth quarter of 2023 were 23%, 26% and 24%, respectively. The effective tax rate for the fourth quarter reflects a year-end adjustment for the effective tax rate for the full-year 2024. Our projected tax rate for 2025 is in the range of 26%-27%.

    Asset Quality

    The provision for credit losses was $3.5 million for the fourth quarter of 2024, $3.8 million for the third quarter of 2024 and $2.7 million for the fourth quarter of 2023, reflecting loan growth, economic outlook and specific reserves. The provision for credit losses was $13.8 million for the full-year 2024 compared to $8.2 million for the full-year 2023. The increase in the full-year 2024 provision for credit losses when compared to the full-year 2023 was primarily due to increases in specific reserves, partially offset by a decrease in the level of general reserves.

    Nonperforming assets, which includes nonaccrual loans and other real estate owned (the Bank had no other real estate owned during the periods reported), was $57.3 million as of December 31, 2024, $51.3 million as of September 30, 2024 and $52.5 million as of December 31, 2023. Nonperforming assets as a percentage of total assets was 0.58% as of December 31, 2024, 0.53% as of September 31, 2024 and 0.53% as of December 31, 2023. The ratio of nonaccrual loans to loans receivable was 0.69%, 0.63% and 0.63%, as of December 31, 2024, September 30, 2024 and December 31, 2023, respectively. The annualized net loan charge-offs ratio was 0.16% for the fourth quarter of 2024, 0.17% for the third quarter of 2024 and 0.43% for the fourth quarter of 2023. The allowance for credit losses represented 1.00%, 1.02%, and 0.98% of loans receivable as of December 31, 2024, September 31, 2024, and December 31, 2023, respectively. The allowance for credit losses as a percentage of nonaccrual loans was 144.3% as of December 31, 2024, 160.8% as of September 30, 2024 and 156.1% as of December 31, 2023. Criticized and classified loans as a percentage of loans receivable was 2.66% as of December 31, 2024, up from 2.23% as of September 30, 2024 and 1.35% as of December 31, 2023. Loans delinquent 30 to 89 days was 0.04% of loans receivable as of December 31, 2024, down from 0.16% as of September 30, 2024 and 0.30% as of December 31, 2023. The overall credit quality metrics of the Bank’s loan portfolio remain sound, with expected levels of charge-offs, nonaccruals, delinquencies, and classified loans expected to remain within historical ranges.

    Selected Balance Sheet Items

    The Company’s total assets were $9.880 billion as of December 31, 2024, compared to $9.856 billion as of December 31, 2023. Loans receivable were $8.275 billion as of December 31, 2024 and $8.345 billion as of December 31, 2023. Total deposits were $7.820 billion as of December 31, 2024 and $7.536 billion as of December 31, 2023.

    The Company’s total stockholders’ equity was $1.242 billion as of December 31, 2024 and $1.217 billion as of December 31, 2023. The increase in total stockholders’ equity was primarily due to an increase in retained earnings of $40.5 million, partially offset by an increase in accumulated other comprehensive losses of approximately $12.7 million and an increase in treasury stock of approximately $5.8 million. As of December 31, 2024, the Company’s tangible common equity ratio and tangible book value per share were 9.49% and $23.92, respectively, compared to 9.25% and $23.14, respectively, as of December 31, 2023. Total goodwill and other intangible assets were $213.0 million as of December 31, 2024, and $214.2 million as of December 31, 2023.

    Use of Non-GAAP Financial Measures

    In addition to the results presented in accordance with Generally Accepted Accounting Principles (“GAAP”), ConnectOne routinely supplements its evaluation with an analysis of certain non-GAAP measures. ConnectOne believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors in understanding our operating performance and trends. These non-GAAP measures have inherent limitations and are not required to be uniformly applied and are not audited. They should not be considered in isolation or as a substitute for an analysis of results reported under GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies. Reconciliations of non-GAAP financial measures disclosed in this earnings release to the comparable GAAP measures are provided in the accompanying tables.

    Fourth Quarter 2024 Results Conference Call

    Management will also host a conference call and audio webcast at 10:00 a.m. ET on January 30, 2025 to review the Company’s financial performance and operating results. The conference call dial-in number is 1 (646) 307-1963, access code 1691400. Please dial in at least five minutes before the start of the call to register. An audio webcast of the conference call will be available to the public, on a listen-only basis, via the “Investor Relations” link on the Company’s website https://www.ConnectOneBank.com or at http://ir.connectonebank.com.

    A replay of the conference call will be available beginning at approximately 1:00 p.m. ET on Thursday, January 30, 2025 and ending on Thursday, February 6, 2025 by dialing 1 (609) 800-9909, access code 1691400. An online archive of the webcast will be available following the completion of the conference call at https://www.ConnectOneBank.com or at http://ir.connectonebank.com.

    About ConnectOne Bancorp, Inc.

    ConnectOne Bancorp, Inc., is a modern financial services company that operates, through its subsidiary, ConnectOne Bank, and the Bank’s fintech subsidiary, BoeFly, Inc. ConnectOne Bank is a high-performing commercial bank offering a full suite of banking & lending products and services that focus on small to middle-market businesses. BoeFly, Inc. is a fintech marketplace that connects borrowers in the franchise space with funding solutions through a network of partner banks. ConnectOne Bancorp, Inc. is traded on the Nasdaq Global Market under the trading symbol “CNOB,” and information about ConnectOne may be found at https://www.connectonebank.com.

    This news release contains certain forward-looking statements which are based on certain assumptions and describe future plans, strategies, and expectations of the Company. These forward-looking statements are generally identified by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” or similar expressions. The Company’s ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations of the Company and its subsidiaries include, but are not limited to, those factors set forth in Item 1A – Risk Factors of the Company’s Annual Report on Form 10-K, as filed with the U.S. Securities and Exchange Commission, as supplemented by the Company’s subsequent filings with the U.S. Securities and Exchange Commission, and changes in interest rates, general economic conditions, legislative/regulatory changes, monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board, the quality or composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in the Company’s market area, changes in accounting principles and guidelines and the impact of the health emergencies and natural disasters on the Company, its employees and operations, and its customers. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions which may be made to any forward-looking statements to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events.

    Investor Contact:
    William S. Burns
    Senior Executive Vice President & CFO
    201.816.4474: bburns@cnob.com

    Media Contact:
    Shannan Weeks 
    MikeWorldWide
    732.299.7890: sweeks@mww.com

             
    CONNECTONE BANCORP, INC. AND SUBSIDIARIES        
    CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL CONDITION      
    (in thousands)        
             
      December 31,   December 31,  
        2024       2023    
      (unaudited)      
    ASSETS        
    Cash and due from banks $ 57,816     $ 61,421    
    Interest-bearing deposits with banks   298,672       181,293    
    Cash and cash equivalents   356,488       242,714    
             
    Investment securities   612,847       617,162    
    Equity securities   20,092       18,564    
             
    Loans held-for-sale   743       –    
             
    Loans receivable   8,274,810       8,345,145    
    Less: Allowance for credit losses – loans   82,685       81,974    
    Net loans receivable   8,192,125       8,263,171    
             
    Investment in restricted stock, at cost   40,449       51,457    
    Bank premises and equipment, net   28,447       30,779    
    Accrued interest receivable   45,498       49,108    
    Bank owned life insurance   243,672       237,644    
    Right of use operating lease assets   14,489       12,007    
    Goodwill   208,372       208,372    
    Core deposit intangibles   4,639       5,874    
    Other assets   111,739       118,751    
    Total assets $ 9,879,600     $ 9,855,603    
             
    LIABILITIES        
    Deposits:        
    Noninterest-bearing $ 1,422,044     $ 1,259,364    
    Interest-bearing   6,398,070       6,276,838    
    Total deposits   7,820,114       7,536,202    
    Borrowings   688,064       933,579    
    Subordinated debentures, net   79,944       79,439    
    Operating lease liabilities   15,498       13,171    
    Other liabilities   34,276       76,592    
    Total liabilities   8,637,896       8,638,983    
             
    COMMITMENTS AND CONTINGENCIES        
             
    STOCKHOLDERS’ EQUITY        
    Preferred stock   110,927       110,927    
    Common stock   586,946       586,946    
    Additional paid-in capital   36,347       33,182    
    Retained earnings   631,446       590,970    
    Treasury stock   (76,116 )     (70,296 )  
    Accumulated other comprehensive loss   (47,846 )     (35,109 )  
    Total stockholders’ equity   1,241,704       1,216,620    
    Total liabilities and stockholders’ equity $ 9,879,600     $ 9,855,603    
             
                     
    CONNECTONE BANCORP, INC. AND SUBSIDIARIES                
    CONSOLIDATED STATEMENTS OF INCOME                
    (dollars in thousands, except for per share data)                
                     
      Three Months Ended Year Ended  
      12/31/24   12/31/23   12/31/24   12/31/23  
    Interest income                
    Interest and fees on loans $ 118,346     $ 120,636   $ 477,859   $ 453,992    
    Interest and dividends on investment securities:                
    Taxable   4,804       4,280     18,561     16,666    
    Tax-exempt   1,109       1,166     4,503     4,641    
    Dividends   959       912     4,349     3,662    
    Interest on federal funds sold and other short-term investments   2,815       1,963     12,617     11,104    
    Total interest income   128,033       128,957     517,889     490,065    
    Interest expense                
    Deposits   58,568       59,332     244,846     206,176    
    Borrowings   4,754       7,803     25,706     28,783    
    Total interest expense   63,322       67,135     270,552     234,959    
                     
    Net interest income   64,711       61,822     247,337     255,106    
    Provision for credit losses   3,500       2,700     13,800     8,200    
    Net interest income after provision for credit losses   61,211       59,122     233,537     246,906    
                     
    Noninterest income                
    Deposit, loan and other income   1,798       1,545     6,861     6,098    
    Income on bank owned life insurance   1,656       1,635     7,142     6,316    
    Net gains on sale of loans held-for-sale   597       472     2,723     1,704    
    Net losses (gains) on equity securities   (307 )     557     2     (117 )  
    Total noninterest income   3,744       4,209     16,728     14,001    
                     
    Noninterest expenses                
    Salaries and employee benefits   22,244       22,010     90,053     88,223    
    Occupancy and equipment   2,818       2,708     11,615     10,884    
    FDIC insurance   1,800       3,900     7,200     8,365    
    Professional and consulting   2,449       1,587     8,447     7,547    
    Marketing and advertising   495       323     2,420     1,965    
    Information technology and communications   4,523       4,148     17,574     14,340    
    Merger expenses   863       –     1,605     –    
    Branch closing expenses   477       –     477     –    
    Amortization of core deposit intangibles   296       348     1,235     1,438    
    Other expenses   2,533       2,821     11,172     11,187    
    Total noninterest expenses   38,498       37,845     151,798     143,949    
                     
    Income before income tax expense   26,457       25,486     98,467     116,958    
    Income tax expense   6,086       6,213     24,674     29,955    
    Net income   20,371       19,273     73,793     87,003    
    Preferred dividends   1,509       1,509     6,036     6,036    
    Net income available to common stockholders $ 18,862     $ 17,764   $ 67,757   $ 80,967    
                     
    Earnings per common share:                
    Basic $ 0.49     $ 0.46   $ 1.77   $ 2.08    
    Diluted   0.49       0.46     1.76     2.07    
                                 
         
    ConnectOne’s management believes that the supplemental financial information, including non-GAAP measures provided below, is useful to investors. The non-GAAP measures should not be viewed as a substitute for financial results determined in accordance with GAAP, and are not necessarily comparable to non-GAAP financial measures presented by other companies.    
                           
    CONNECTONE BANCORP, INC.                     
    SUPPLEMENTAL GAAP AND NON-GAAP FINANCIAL MEASURES                     
                           
      As of    
      Dec. 31,   Sept. 30,   Jun. 30,   Mar. 31,   Dec. 31,    
        2024       2024       2024       2024       2023      
    Selected Financial Data (dollars in thousands)    
    Total assets $ 9,879,600     $ 9,639,603     $ 9,723,731     $ 9,853,964     $ 9,855,603      
    Loans receivable:                      
    Commercial $ 1,522,308     $ 1,505,743     $ 1,491,079     $ 1,561,063     $ 1,564,768      
    Commercial real estate   3,384,319       3,261,160       3,274,941       3,333,488       3,342,603      
    Multifamily   2,506,782       2,482,258       2,499,581       2,507,893       2,566,904      
    Commercial construction   616,246       616,087       639,168       646,593       620,496      
    Residential   249,691       250,249       256,786       254,214       256,041      
    Consumer   1,136       835       945       850       1,029      
    Gross loans   8,280,482       8,116,332       8,162,500       8,304,101       8,351,841      
    Net deferred loan fees   (5,672 )     (4,356 )     (4,597 )     (6,144 )     (6,696 )    
    Loans receivable   8,274,810       8,111,976       8,157,903       8,297,957       8,345,145      
    Loans held-for-sale   743       –       435       –       –      
    Total loans $ 8,275,553     $ 8,111,976     $ 8,158,338     $ 8,297,957     $ 8,345,145      
                           
    Investment and equity securities $ 632,939     $ 667,112     $ 640,322     $ 638,854     $ 635,726      
    Goodwill and other intangible assets   213,011       213,307       213,604       213,925       214,246      
    Deposits:                      
    Noninterest-bearing demand $ 1,422,044     $ 1,262,568     $ 1,268,882     $ 1,290,523     $ 1,259,364      
    Time deposits   2,557,200       2,614,187       2,593,165       2,623,391       2,531,371      
    Other interest-bearing deposits   3,840,870       3,647,350       3,713,967       3,674,740       3,745,467      
    Total deposits $ 7,820,114     $ 7,524,105     $ 7,576,014     $ 7,588,654     $ 7,536,202      
                           
    Borrowings $ 688,064     $ 742,133     $ 756,144     $ 877,568     $ 933,579      
    Subordinated debentures (net of debt issuance costs)   79,944       79,818       79,692       79,566       79,439      
    Total stockholders’ equity   1,241,704       1,239,496       1,224,227       1,216,609       1,216,620      
                           
    Quarterly Average Balances                      
    Total assets $ 9,653,446     $ 9,742,853     $ 9,745,853     $ 9,860,753     $ 9,690,746      
    Loans receivable:                      
    Commercial $ 1,487,850     $ 1,485,777     $ 1,517,446     $ 1,552,360     $ 1,510,634      
    Commercial real estate (including multifamily)   5,733,188       5,752,467       5,789,498       5,890,853       5,874,854      
    Commercial construction   631,022       628,740       652,227       637,993       630,468      
    Residential   250,589       252,975       254,284       252,965       253,200      
    Consumer   5,204       7,887       5,155       5,091       6,006      
    Gross loans   8,107,853       8,127,846       8,218,610       8,339,262       8,275,162      
    Net deferred loan fees   (4,727 )     (4,513 )     (5,954 )     (6,533 )     (6,894 )    
    Loans receivable   8,103,126       8,123,333       8,212,656       8,332,729       8,268,268      
    Loans held-for-sale   498       83       169       99       31      
    Total loans $ 8,103,624     $ 8,123,416     $ 8,212,825     $ 8,332,828     $ 8,268,299      
                           
    Investment and equity securities $ 653,988     $ 650,897     $ 637,551     $ 633,270     $ 602,287      
    Goodwill and other intangible assets   213,205       213,502       213,813       214,133       214,472      
    Deposits:                      
    Noninterest-bearing demand $ 1,304,699     $ 1,259,912     $ 1,256,251     $ 1,254,201     $ 1,248,132      
    Time deposits   2,478,163       2,625,329       2,587,706       2,567,767       2,495,091      
    Other interest-bearing deposits   3,838,575       3,747,427       3,721,167       3,696,374       3,747,093      
    Total deposits $ 7,621,437     $ 7,632,668     $ 7,565,124     $ 7,518,342     $ 7,490,316      
                           
    Borrowings $ 648,300     $ 717,586     $ 787,256     $ 947,003     $ 823,123      
    Subordinated debentures (net of debt issuance costs)   79,862       79,735       79,609       79,483       79,356      
    Total stockholders’ equity   1,241,738       1,234,724       1,220,621       1,220,818       1,198,389      
                           
      Three Months Ended    
      Dec. 31,   Sept. 30,   Jun. 30,   Mar. 31,   Dec. 31,    
        2024       2024       2024       2024       2023      
      (dollars in thousands, except for per share data)    
    Net interest income $ 64,711     $ 60,887     $ 61,439     $ 60,300     $ 61,822      
    Provision for credit losses   3,500       3,800       2,500       4,000       2,700      
    Net interest income after provision for credit losses   61,211       57,087       58,939       56,300       59,122      
    Noninterest income                      
    Deposit, loan and other income   1,798       1,817       1,654       1,592       1,545      
    Income on bank owned life insurance   1,656       2,145       1,677       1,664       1,635      
    Net gains on sale of loans held-for-sale   597       343       1,277       506       472      
    Net (losses) gains on equity securities   (307 )     432       (209 )     86       557      
    Total noninterest income   3,744       4,737       4,399       3,848       4,209      
    Noninterest expenses                      
    Salaries and employee benefits   22,244       22,957       22,721       22,131       22,010      
    Occupancy and equipment   2,818       2,889       2,899       3,009       2,708      
    FDIC insurance   1,800       1,800       1,800       1,800       3,900      
    Professional and consulting   2,449       2,147       1,923       1,928       1,587      
    Marketing and advertising   495       635       613       677       323      
    Information technology and communications   4,523       4,464       4,198       4,389       4,148      
    Merger expenses   863       742       –       –       –      
    Branch closing expenses   477       –       –       –       –      
    Amortization of core deposit intangible   296       297       321       321       348      
    Other expenses   2,533       2,710       3,119       2,810       2,821      
    Total noninterest expenses   38,498       38,641       37,594       37,065       37,845      
                           
    Income before income tax expense   26,457       23,183       25,744       23,083       25,486      
    Income tax expense   6,086       6,022       6,688       5,878       6,213      
    Net income   20,371       17,161       19,056       17,205       19,273      
    Preferred dividends   1,509       1,509       1,509       1,509       1,509      
    Net income available to common stockholders $ 18,862     $ 15,652     $ 17,547     $ 15,696     $ 17,764      
                           
    Weighted average diluted common shares outstanding   38,519,581       38,525,484       38,448,594       38,511,747       38,651,391      
    Diluted EPS $ 0.49     $ 0.41     $ 0.46     $ 0.41     $ 0.46      
                           
    Reconciliation of GAAP Net Income to Operating Net Income:                      
    Net income $ 20,371     $ 17,161     $ 19,056     $ 17,205     $ 19,273      
    FDIC special assessment   –       –       –       –       2,100      
    Merger expenses   863       742       –       –       –      
    Branch closing expenses   477       –       –       –       –      
    Amortization of core deposit intangibles   296       297       321       321       348      
    Net losses (gains) on equity securities   307       (432 )     209       (86 )     (557 )    
    Tax impact of adjustments   (585 )     (171 )     (149 )     (66 )     (569 )    
    Operating net income $ 21,729     $ 17,597     $ 19,437     $ 17,374     $ 20,595      
    Preferred dividends   1,509       1,509       1,509       1,509       1,509      
    Operating net income available to common stockholders $ 20,220     $ 16,088     $ 17,928     $ 15,865     $ 19,086      
                           
    Operating diluted EPS (non-GAAP) (1) $ 0.52     $ 0.42     $ 0.47     $ 0.41     $ 0.49      
                           
    Return on Assets Measures                      
    Average assets $ 9,653,446     $ 9,742,853     $ 9,745,853     $ 9,860,753     $ 9,690,746      
    Return on avg. assets   0.84   %   0.70   %   0.79   %   0.70   %   0.79   %  
    Operating return on avg. assets (non-GAAP) (2)   0.90       0.72       0.80       0.71       0.84      
                           
    (1) Operating net income available to common stockholders divided by weighted average diluted shares outstanding.              
    (2) Operating net income divided by average assets.              
                           
      Three Months Ended    
      Dec. 31,   Sept. 30,   Jun. 30,   Mar. 31,   Dec. 31,    
        2024       2024       2024       2024       2023      
    Return on Equity Measures (dollars in thousands)    
    Average stockholders’ equity $ 1,241,738     $ 1,234,724     $ 1,220,621     $ 1,220,818     $ 1,198,389      
    Less: average preferred stock   (110,927 )     (110,927 )     (110,927 )     (110,927 )     (110,927 )    
    Average common equity $ 1,130,811     $ 1,123,797     $ 1,109,694     $ 1,109,891     $ 1,087,462      
    Less: average intangible assets   (213,205 )     (213,502 )     (213,813 )     (214,133 )     (214,472 )    
    Average tangible common equity $ 917,606     $ 910,295     $ 895,881     $ 895,758     $ 872,990      
    Return on avg. common equity (GAAP)   6.64   %   5.54   %   6.36   %   5.69   %   6.48   %  
    Operating return on avg. common equity (non-GAAP) (3)   7.11       5.70       6.50       5.75       6.96      
    Return on avg. tangible common equity (non-GAAP) (4)   8.27       6.93       7.98       7.15       8.18      
    Operating return on avg. tangible common equity (non-GAAP) (5)   8.77       7.03       8.05       7.12       8.67      
                           
    Efficiency Measures                      
    Total noninterest expenses $ 38,498     $ 38,641     $ 37,594     $ 37,065     $ 37,845      
    FDIC special assessment   –       –       –       –       (2,100 )    
    Merger expenses   (863 )     (742 )     –       –       –      
    Branch closing expenses   (477 )     –       –       –       –      
    Amortization of core deposit intangibles   (296 )     (297 )     (321 )     (321 )     (348 )    
    Operating noninterest expense $ 36,862     $ 37,602     $ 37,273     $ 36,744     $ 35,397      
                           
    Net interest income (tax equivalent basis) $ 65,593     $ 61,710     $ 62,255     $ 61,111     $ 62,627      
    Noninterest income   3,744       4,737       4,399       3,848       4,209      
    Net losses (gains) on equity securities   307       (432 )     209       (86 )     (557 )    
    Operating revenue $ 69,644     $ 66,015     $ 66,863     $ 64,873     $ 66,279      
                           
    Operating efficiency ratio (non-GAAP) (6)   52.9   %   57.0   %   55.7   %   56.6   %   53.4   %  
                           
    Net Interest Margin                      
    Average interest-earning assets $ 9,117,201     $ 9,206,038     $ 9,210,050     $ 9,323,291     $ 9,172,165      
    Net interest income (tax equivalent basis)   65,593       61,710       62,255       61,111       62,627      
    Net interest margin (GAAP)   2.86   %   2.67   %   2.72   %   2.64   %   2.71   %  
                           
    (3) Operating net income available to common stockholders divided by average common equity.        
    (4) Net income available to common stockholders, excluding amortization of intangible assets, divided by average tangible common equity.        
    (5) Operating net income available to common stockholders, divided by average tangible common equity.        
    (6) Operating noninterest expense divided by operating revenue.        
                           
      As of    
      Dec. 31,   Sept. 30,   Jun. 30,   Mar. 31,   Dec. 31,    
        2024       2024       2024       2024       2023      
    Capital Ratios and Book Value per Share (dollars in thousands, except for per share data)    
    Stockholders equity $ 1,241,704     $ 1,239,496     $ 1,224,227     $ 1,216,609     $ 1,216,620      
    Less: preferred stock   (110,927 )     (110,927 )     (110,927 )     (110,927 )     (110,927 )    
    Common equity $ 1,130,777     $ 1,128,569     $ 1,113,300     $ 1,105,682     $ 1,105,693      
    Less: intangible assets   (213,011 )     (213,307 )     (213,604 )     (213,925 )     (214,246 )    
    Tangible common equity $ 917,766     $ 915,262     $ 899,696     $ 891,757     $ 891,447      
                           
    Total assets $ 9,879,600     $ 9,639,603     $ 9,723,731     $ 9,853,964     $ 9,855,603      
    Less: intangible assets   (213,011 )     (213,307 )     (213,604 )     (213,925 )     (214,246 )    
    Tangible assets $ 9,666,589     $ 9,426,296     $ 9,510,127     $ 9,640,039     $ 9,641,357      
                           
    Common shares outstanding   38,370,317       38,368,217       38,365,069       38,333,053       38,519,770      
                           
    Common equity ratio (GAAP)   11.45   %   11.71   %   11.45   %   11.22   %   11.22   %  
    Tangible common equity ratio (non-GAAP) (7)   9.49       9.71       9.46       9.25       9.25      
                           
    Regulatory capital ratios (Bancorp):                      
    Leverage ratio   11.33   %   11.10   %   10.97   %   10.73   %   10.86   %  
    Common equity Tier 1 risk-based ratio   10.97       11.07       10.90       10.70       10.62      
    Risk-based Tier 1 capital ratio   12.29       12.42       12.25       12.03       11.95      
    Risk-based total capital ratio   14.11       14.29       14.10       13.88       13.77      
                           
    Regulatory capital ratios (Bank):                      
    Leverage ratio   11.66   %   11.43   %   11.29   %   11.10   %   11.20   %  
    Common equity Tier 1 risk-based ratio   12.63       12.79       12.60       12.43       12.31      
    Risk-based Tier 1 capital ratio   12.63       12.79       12.60       12.43       12.31      
    Risk-based total capital ratio   13.60       13.77       13.58       13.41       13.28      
                           
    Book value per share (GAAP) $ 29.47     $ 29.41     $ 29.02     $ 28.84     $ 28.70      
    Tangible book value per share (non-GAAP) (8)   23.92       23.85       23.45       23.26       23.14      
                           
    Net Loan Charge-offs (Recoveries):                      
    Net loan charge-offs (recoveries):                      
    Charge-offs $ 3,363     $ 3,559     $ 3,595     $ 3,185     $ 8,960      
    Recoveries   (29 )     (53 )     (324 )     (23 )     –      
    Net loan charge-offs $ 3,334     $ 3,506     $ 3,271     $ 3,162     $ 8,960      
    Net loan charge-offs as a % of average loans receivable (annualized)   0.16   %   0.17   %   0.16   %   0.15   %   0.43   %  
                           
    Asset Quality                      
    Nonaccrual loans $ 57,310     $ 51,300     $ 46,026     $ 47,438     $ 52,524      
    Other real estate owned   –       –       –       –       –      
    Nonperforming assets $ 57,310     $ 51,300     $ 46,026     $ 47,438     $ 52,524      
                           
    Allowance for credit losses – loans (“ACL”) $ 82,685     $ 82,494     $ 82,077     $ 82,869     $ 81,974      
    Loans receivable   8,274,810       8,111,976       8,157,903       8,297,957       8,345,145      
                           
    Nonaccrual loans as a % of loans receivable   0.69   %   0.63   %   0.56   %   0.57   %   0.63   %  
    Nonperforming assets as a % of total assets   0.58       0.53       0.47       0.48       0.53      
    ACL as a % of loans receivable   1.00       1.02       1.01       1.00       0.98      
    ACL as a % of nonaccrual loans   144.3       160.8       178.3       174.7       156.1      
                           
    (7) Tangible common equity divided by tangible assets                
    (8) Tangible common equity divided by common shares outstanding at period-end                
                           
                                   
    CONNECTONE BANCORP, INC.                              
    NET INTEREST MARGIN ANALYSIS                              
    (dollars in thousands)                                
                                         
            For the Quarter Ended    
            December 31, 2024 September 30, 2024 December 31, 2023
            Average         Average         Average        
    Interest-earning assets:   Balance Interest Rate (7)   Balance Interest Rate (7)   Balance Interest Rate (7)
    Investment securities (1) (2) $ 736,131   $ 6,207   3.35 %   $ 736,946   $ 6,157   3.32 %   $ 723,433   $ 5,757   3.16 %  
    Loans receivable and loans held-for-sale (2) (3) (4)   8,103,624     118,934   5.84       8,123,416     119,805   5.87       8,268,299     121,130   5.81    
    Federal funds sold and interest-                              
    bearing deposits with banks   238,957     2,815   4.69       304,009     4,056   5.31       134,168     1,963   5.80    
    Restricted investment in bank stock   38,489     959   9.91       41,667     1,048   10.01       46,265     912   7.82    
    Total interest-earning assets   9,117,201     128,915   5.63       9,206,038     131,066   5.66       9,172,165     129,762   5.61    
    Allowance for credit losses   (83,938 )           (83,355 )           (88,861 )        
    Noninterest-earning assets     620,183             620,170             607,442          
    Total assets     $ 9,653,446           $ 9,742,853           $ 9,690,746          
                                         
    Interest-bearing liabilities:                              
    Time deposits     $ 2,478,163     27,374   4.39     $ 2,625,329     30,245   4.58     $ 2,495,091     26,486   4.21    
    Other interest-bearing deposits   3,838,575     31,194   3.23       3,747,427     33,540   3.56       3,747,093     32,846   3.48    
    Total interest-bearing deposits   6,316,738     58,568   3.69       6,372,756     63,785   3.98       6,242,184     59,332   3.77    
                                         
    Borrowings       648,300     3,430   2.10       717,586     4,239   2.35       823,123     6,467   3.12    
    Subordinated debentures, net   79,862     1,305   6.50       79,735     1,312   6.55       79,356     1,313   6.56    
    Finance lease       1,280     19   5.91       1,349     20   5.90       1,546     23   5.90    
    Total interest-bearing liabilities   7,046,180     63,322   3.58       7,171,426     69,356   3.85       7,146,209     67,135   3.73    
                                         
    Noninterest-bearing demand deposits   1,304,699             1,259,912             1,248,132          
    Other liabilities       60,829             76,791             98,016          
    Total noninterest-bearing liabilities   1,365,528             1,336,703             1,346,148          
    Stockholders’ equity     1,241,738             1,234,724             1,198,389          
    Total liabilities and stockholders’ equity $ 9,653,446           $ 9,742,853           $ 9,690,746          
                                         
    Net interest income (tax equivalent basis)     65,593             61,710             62,627        
    Net interest spread (5)       2.05 %       1.82 %       1.89 %  
                                         
    Net interest margin (6)       2.86 %       2.67 %       2.71 %  
                                         
    Tax equivalent adjustment       (882 )           (823 )           (805 )      
    Net interest income     $ 64,711           $ 60,887           $ 61,822        
                                         
    (1) Average balances are calculated on amortized cost.              
    (2) Interest income is presented on a tax equivalent basis using 21% federal tax rate.              
    (3) Includes loan fee income.              
    (4) Loans include nonaccrual loans.              
    (5) Represents difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities and is presented on a tax equivalent basis.              
    (6) Represents net interest income on a tax equivalent basis divided by average total interest-earning assets.               
    (7) Rates are annualized.              
                                         

    The MIL Network –

  • MIL-OSI: Allegro MicroSystems Reports Third Quarter 2025 Results

    Source: GlobeNewswire (MIL-OSI)

    MANCHESTER, N.H., Jan. 30, 2025 (GLOBE NEWSWIRE) — Allegro MicroSystems, Inc. (“Allegro” or the “Company”) (Nasdaq: ALGM), a global leader in power and sensing semiconductor solutions for motion control and energy efficient systems, today announced financial results for its third quarter ended December 27, 2024.  

    “We delivered on our commitments with third quarter sales of $178 million and non-GAAP EPS of $0.07, both above the midpoint of our guidance,” said Vineet Nargolwala, President and CEO of Allegro. “During the quarter, we introduced a record number of new magnetic sensing and power products to the market, further expanding our differentiated portfolios. This increasing velocity further solidifies our market leadership and positions us well for above market growth.”

    Third Quarter Financial Highlights:

    In thousands, except per share data   Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)     (Unaudited)  
    Net Sales                              
    Automotive   $ 130,066     $ 141,893     $ 194,764     $ 403,143     $ 577,515  
    Industrial and other     47,806       45,498       60,220       129,039       231,271  
    Total net sales   $ 177,872     $ 187,391     $ 254,984     $ 532,182     $ 808,786  
    GAAP Financial Measures                              
    Gross margin %     45.7 %     45.7 %     52.5 %     45.4 %     55.8 %
    Operating margin %     — %     2.2 %     14.4 %     (1.2 )%     22.3 %
    Diluted EPS   $ (0.04 )   $ (0.18 )   $ 0.17     $ (0.31 )   $ 0.82  
    Non-GAAP Financial Measures                              
    Gross margin %     49.1 %     48.8 %     54.6 %     48.9 %     57.0 %
    Operating margin %     10.8 %     11.7 %     27.2 %     9.6 %     29.8 %
    Diluted EPS   $ 0.07     $ 0.08     $ 0.32     $ 0.18     $ 1.11  
                                             

    Business Outlook

    For the fourth quarter of fiscal year 2025 ending March 28, 2025, the Company expects total net sales to be in the range of $180 million to $190 million.

    The Company also estimates the following results on a non-GAAP basis:

    • Gross Margin is expected to be between 46% and 48%, which contemplates the impact of annual pricing agreements ahead of cost reductions, as well as higher capacity charges resulting from adjusted production levels in the quarter,
    • Operating expenses are expected to increase by approximately 5% sequentially to $72 million, primarily  due to annual payroll tax resets,
    • As a result of the expected repricing of the term loan and anticipated $30 million Q4 debt repayment, the Company now expects Interest Expense to be approximately $6 million, and
    • Diluted Earnings per Share are expected to be between $0.03 and $0.07.

    Allegro has not provided a reconciliation of its fourth fiscal quarter outlook for non-GAAP Gross Margin, non-GAAP Operating Expenses, non-GAAP Interest Expense, and non-GAAP Diluted Earnings per Share because estimates of all of the reconciling items cannot be provided without unreasonable efforts. It is difficult to reasonably provide a forward-looking estimate between such forward-looking non-GAAP measures and the comparable forward-looking U.S. generally accepted accounting principles (“GAAP”) measures. Certain factors that are materially significant to Allegro’s ability to estimate these items are out of its control and/or cannot be reasonably predicted.

    Earnings Webcast

    A webcast will be held on Thursday, January 30, 2025 at 8:30 a.m., Eastern Time. Vineet Nargolwala, President and Chief Executive Officer, and Derek P. D’Antilio, Executive Vice President and Chief Financial Officer, will discuss Allegro’s business and financial results.

    The webcast will be available on the Investor Relations section of the Company’s website at investors.allegromicro.com. A recording of the webcast will be posted in the same location shortly after the call concludes and will be available for at least 90 days.

    About Allegro MicroSystems

    Allegro MicroSystems is a leading global designer, developer, fabless manufacturer and marketer of sensor integrated circuits (“ICs”) and application-specific analog power ICs enabling emerging technologies in the automotive and industrial markets. Allegro’s diverse product portfolio provides efficient and reliable solutions for the electrification of vehicles, automotive ADAS safety features, automation for Industry 4.0 and power saving technologies for data centers and clean energy applications.

    Forward-Looking Statements         

    This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, contained in this press release including statements regarding our future results of operations and financial position, business strategy, prospective products and the plans and objectives of management for future operations, including, among others, statements regarding the liquidity, growth and profitability strategies and factors affecting our business are forward-looking statements. These statements involve known and unknown risks, uncertainties and other important factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.

    Without limiting the foregoing, in some cases, you can identify forward-looking statements by terms such as “aim,” “may,” “will,” “should,” “expect,” “exploring,” “plan,” “anticipate,” “could,” “intend,” “target,” “project,” “would,” “contemplate,” “believe,” “estimate,” “predict,” “potential,” “seek,” or “continue” or the negative of these terms or other similar expressions, although not all forward-looking statements contain these words. No forward-looking statement is a guarantee of future results, performance or achievements, and one should avoid placing undue reliance on such statements.

    Forward-looking statements are based on our management’s current expectations, beliefs and assumptions and on information currently available to us. Such beliefs and assumptions may or may not prove to be correct. Additionally, such forward-looking statements are subject to a number of known and unknown risks, uncertainties and assumptions, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, those identified in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and Part I, Item 1A. “Risk Factors” in our Annual Report on Form 10-K for the year ended March 29, 2024, as any such factors may be updated from time to time in our Quarterly Reports on Form 10-Q and our other filings with the Securities and Exchange Commission (the “SEC”). These risks and uncertainties include, but are not limited to: downturns or volatility in general economic conditions; our ability to compete effectively, expand our market share and increase our net sales and profitability; our reliance on a limited number of third-party semiconductor wafer fabrication facilities and suppliers of other materials; any failure to adjust purchase commitments and inventory management based on changing market conditions or customer demand; shifts in our product mix, customer mix or channel mix, which could negatively impact our gross margin; the cyclical nature of the semiconductor industry, including the analog segment in which we compete; any downturn or disruption in the automotive market or industry; our ability to successfully integrate the acquisition of other companies or technologies and products into our business; our ability to compensate for decreases in average selling prices of our products and increases in input costs; our ability to manage any sustained yield problems or other delays at our third-party wafer fabrication facilities or in the final assembly and test of our products; our ability to accurately predict our quarterly net sales and operating results and meet the expectations of investors; our dependence on manufacturing operations in the Philippines; our reliance on distributors to generate sales; events beyond our control impacting us, our key suppliers or our manufacturing partners; our ability to develop new product features or new products in a timely and cost-effective manner; our ability to manage growth; any slowdown in the growth of our end markets; the loss of one or more significant customers; our ability to meet customers’ quality requirements; uncertainties related to the design win process and our ability to recover design and development expenses and to generate timely or sufficient net sales or margins; changes in government trade policies, including the imposition of export restrictions and tariffs; our exposures to warranty claims, product liability claims and product recalls; our dependence on international customers and operations; the availability of rebates, tax credits and other financial incentives on end-user demands for certain products; risks, liabilities, costs and obligations related to governmental regulations and other legal obligations, including export/trade control, privacy, data protection, information security, cybersecurity, consumer protection, environmental and occupational health and safety, antitrust, anti-corruption and anti-bribery, product safety, environmental protection, employment matters and tax; the volatility of currency exchange rates; our ability to raise capital to support our growth strategy; our indebtedness may limit our flexibility to operate our business; our ability to effectively manage our growth and to retain key and highly skilled personnel; our ability to protect our proprietary technology and inventions through patents or trade secrets; our ability to commercialize our products without infringing third-party intellectual property rights; disruptions or breaches of our information technology systems or confidential information or those of our third-party service providers; our principal stockholder continues to have influence over us; anti-takeover provisions in our organizational documents and under the General Corporation Law of the State of Delaware; any failure to design, implement or maintain effective internal control over financial reporting; changes in tax rates or the adoption of new tax legislation; the negative impacts of sustained inflation on our business; the physical, transition and litigation risks presented by climate change; and other events beyond our control. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties.

    You should read this press release and the documents that we reference completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. All forward-looking statements speak only as of the date of this press release, and except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements, whether as a result of any new information, future events, changed circumstances or otherwise.

    This press release includes certain non-GAAP financial measures as defined by the SEC rules. These non-GAAP financial measures are provided in addition to, and not as a substitute for or superior to measures of, financial performance prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP financial measures versus their most directly comparable GAAP equivalents. For example, other companies may calculate non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of the presented non-GAAP financial measures as tools for comparison.

    This press release may not be reproduced, forwarded to any person or published, in whole or in part.

    ALLEGRO MICROSYSTEMS, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (in thousands, except share and per share amounts)
    (Unaudited)
     
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
    Net sales   $ 177,872     $ 254,984     $ 532,182     $ 808,786  
    Cost of goods sold     96,657       121,156       290,534       357,505  
    Gross profit     81,215       133,828       241,648       451,281  
    Operating expenses:                        
    Research and development     43,317       44,396       132,031       130,799  
    Selling, general and administrative     37,939       52,746       116,221       140,135  
    Total operating expenses     81,256       97,142       248,252       270,934  
    Operating (loss) income     (41 )     36,686       (6,604 )     180,347  
    Interest and other (expense) income     (7,561 )     (315 )     (25,902 )     (2,801 )
    Loss on change in fair value of forward repurchase contract     —       —       (34,752 )     —  
    (Loss) income before income taxes     (7,602 )     36,371       (67,258 )     177,546  
    Income tax (benefit) provision     (803 )     2,969       (9,233 )     17,584  
    Net (loss) income     (6,799 )     33,402       (58,025 )     159,962  
    Net income attributable to non-controlling interests     61       57       185       150  
    Net (loss) income attributable to Allegro MicroSystems, Inc.   $ (6,860 )   $ 33,345     $ (58,210 )   $ 159,812  
    Net (loss) income per common share attributable to Allegro MicroSystems, Inc.:                        
    Basic   $ (0.04 )   $ 0.17     $ (0.31 )   $ 0.83  
    Diluted   $ (0.04 )   $ 0.17     $ (0.31 )   $ 0.82  
    Weighted average shares outstanding:                        
    Basic     184,011,189       192,724,541       188,886,583       192,384,315  
    Diluted     184,011,189       194,570,380       188,886,583       194,925,040  
     

    Supplemental Schedule of Total Net Sales

    The following table summarizes total net sales by market within the Company’s unaudited condensed consolidated statements of operations:

        Three-Month Period Ended     Change     Nine-Month Period Ended     Change  
        December 27, 2024     December 29, 2023     Amount     %     December 27, 2024     December 29, 2023     Amount     %  
        (Dollars in thousands)     (Dollars in thousands)  
    Automotive   $ 130,066     $ 194,764     $ (64,698 )     (33 )%   $ 403,143     $ 577,515     $ (174,372 )     (30 )%
    Industrial and other     47,806       60,220       (12,414 )     (21 )%     129,039       231,271       (102,232 )     (44 )%
    Total net sales   $ 177,872     $ 254,984     $ (77,112 )     (30 )%   $ 532,182     $ 808,786     $ (276,604 )     (34 )%
     
    ALLEGRO MICROSYSTEMS, INC.
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (in thousands)
     
        December 27,     March 29,  
        2024
    (Unaudited)    		     2024  
    Assets            
    Current assets:            
    Cash and cash equivalents   $ 138,452     $ 212,143  
    Restricted cash     10,510       10,018  
    Trade accounts receivable, net     83,805       118,508  
    Inventories     193,140       162,302  
    Prepaid income taxes     36,037       31,908  
    Prepaid expenses and other current assets     33,683       33,584  
    Current portion of related party notes receivable     —       3,750  
    Total current assets     495,627       572,213  
    Property, plant and equipment, net     320,975       321,175  
    Deferred income tax assets     65,398       54,496  
    Goodwill     202,101       202,425  
    Intangible assets, net     261,553       276,854  
    Related party notes receivable, less current portion     —       4,688  
    Equity investment in related party     30,914       26,727  
    Other assets     65,172       72,025  
    Total assets   $ 1,441,740     $ 1,530,603  
    Liabilities, Non-Controlling Interests and Stockholders’ Equity            
    Current liabilities:            
    Trade accounts payable   $ 39,685     $ 35,964  
    Amounts due to related party     2,102       1,626  
    Accrued expenses and other current liabilities     57,751       76,389  
    Current portion of long-term debt     1,374       3,929  
    Total current liabilities     100,912       117,908  
    Long-term debt     374,729       249,611  
    Other long-term liabilities     31,673       31,368  
    Total liabilities     507,314       398,887  
    Commitments and contingencies            
    Stockholders’ Equity:            
    Preferred stock     —       —  
    Common stock     1,840       1,932  
    Additional paid-in capital     1,004,080       694,332  
    (Accumulated deficit) retained earnings     (38,791 )     463,012  
    Accumulated other comprehensive loss     (34,084 )     (28,841 )
    Equity attributable to Allegro MicroSystems, Inc.     933,045       1,130,435  
    Non-controlling interests     1,381       1,281  
    Total stockholders’ equity     934,426       1,131,716  
    Total liabilities, non-controlling interests and stockholders’ equity   $ 1,441,740     $ 1,530,603  
    ALLEGRO MICROSYSTEMS, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (in thousands)
    (Unaudited)
     
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
    Cash flows from operating activities:                        
    Net (loss) income   $ (6,799 )   $ 33,402     $ (58,025 )   $ 159,962  
    Adjustments to reconcile net (loss) income to net cash provided by operating activities:                        
    Depreciation and amortization     16,123       20,195       48,578       49,548  
    Amortization of deferred financing costs     694       185       1,781       292  
    Deferred income taxes     (3,751 )     (10,119 )     (11,546 )     (28,253 )
    Stock-based compensation     10,588       10,920       32,251       32,839  
    Loss on change in fair value of forward repurchase contract     —       —       34,752       —  
    Provisions for inventory and expected credit losses     3,031       429       7,519       9,851  
    Change in fair value of marketable securities     —       —       —       3,579  
    Other non-cash reconciling items     68       (25 )     6,645       18  
    Changes in operating assets and liabilities:                        
    Trade accounts receivable     (7,061 )     5,081       34,356       (2,564 )
    Inventories     (19,243 )     11,312       (38,074 )     (19,909 )
    Prepaid expenses and other assets     14,407       7,368       (1,401 )     (13,085 )
    Trade accounts payable     (8,203 )     (12,299 )     5,467       (9,604 )
    Due to and from related parties     (3,568 )     705       564       6,817  
    Accrued expenses and other current and long-term liabilities     (4,469 )     9,404       (21,307 )     (20,540 )
    Net cash (used in) provided by operating activities     (8,183 )     76,558       41,560       168,951  
    Cash flows from investing activities:                        
    Purchases of property, plant and equipment     (13,615 )     (34,399 )     (34,564 )     (110,500 )
    Acquisition of business, net of cash acquired     319       (408,119 )     319       (408,119 )
    Sales of marketable securities     —       —       —       16,175  
    Net cash used in investing activities     (13,296 )     (442,518 )     (34,245 )     (502,444 )
    Cash flows from financing activities:                        
    Net proceeds from Refinanced 2023 Term Loan Facility     —       —       193,483       —  
    Repayment of 2023 Term Loan Facility     (25,000 )     —       (75,000 )     —  
    Borrowings of senior secured debt, net of deferred financing costs     —       245,452       —       245,452  
    Repayment of 2020 Term Loan Facility     —       (25,000 )     —       (25,000 )
    Repayments of other debt     —       (743 )     —       (743 )
    Finance lease payments     (318 )     —       (703 )     —  
    Receipts on related party notes receivable     —       938       1,875       2,813  
    Payments for taxes related to net share settlement of equity awards     (483 )     (10,732 )     (12,780 )     (24,823 )
    Proceeds from issuance of common stock under employee stock purchase plan     —       —       1,987       1,899  
    Repurchases of common stock     (116 )     —       (853,921 )     —  
    Net proceeds from issuance of common stock     —       —       665,850       —  
    Payment of debt issuance costs     —       —       —       (1,450 )
    Net cash (used in) provided by financing activities     (25,917 )     209,915       (79,209 )     198,148  
    Effect of exchange rate changes on cash and cash equivalents and restricted cash     (2,680 )     1,349       (1,305 )     375  
    Net (decrease) increase in cash and cash equivalents and restricted cash     (50,076 )     (154,696 )     (73,199 )     (134,970 )
    Cash and cash equivalents and restricted cash at beginning of period     199,038       378,431       222,161       358,705  
    Cash and cash equivalents and restricted cash at end of period:   $ 148,962     $ 223,735     $ 148,962     $ 223,735  
     

    Non-GAAP Financial Measures

    In addition to the measures presented in our condensed consolidated financial statements, we regularly review other measures, defined as non-GAAP financial measures by the SEC, to evaluate our business, measure our performance, identify trends, prepare financial forecasts and make strategic decisions. The key measures we consider are non-GAAP Gross Profit, non-GAAP Gross Margin, non-GAAP Operating Expenses, non-GAAP Operating Income, non-GAAP Operating Margin, EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP Profit before Tax, non-GAAP Income Tax Provision, non-GAAP Effective Tax Rate, non-GAAP Net Income Attributable to Allegro MicroSystems, Inc, non-GAAP Basic and Diluted Earnings per Share, non-GAAP Free Cash Flow, and non-GAAP Free Cash Flow as percentage of net sales (collectively, the “Non-GAAP Financial Measures”). These Non-GAAP Financial Measures provide supplemental information regarding our operating performance on a non-GAAP basis that excludes certain gains, losses and charges of a non-cash nature or that occur relatively infrequently and/or that management considers to be unrelated to our core operations, and in the case of non-GAAP Income Tax Provision, management believes that this non-GAAP measure of income taxes provides it with the ability to evaluate the non-GAAP Income Tax Provision across different reporting periods on a consistent basis, independent of special items and discrete items, which may vary in size and frequency. These Non-GAAP Financial Measures are used by both management and our board of directors, together with the comparable GAAP information, in evaluating our current performance and planning our future business activities.

    The Non-GAAP Financial Measures are supplemental measures of our performance that are neither required by, nor presented in accordance with, GAAP. These Non-GAAP Financial Measures should not be considered as substitutes for GAAP financial measures, such as gross profit, gross margin, net income or any other performance measures derived in accordance with GAAP. Also, in the future we may incur expenses or charges, such as those being adjusted in the calculation of these Non-GAAP Financial Measures. Our presentation of these Non-GAAP Financial Measures should not be construed as an inference that future results will be unaffected by unusual or nonrecurring items. These Non-GAAP Financial Measures exclude costs related to acquisition and related integration expenses, amortization of acquired intangible assets, stock-based compensation, restructuring actions, related-party activities and other non-operational costs.

    Non-GAAP Income Tax Provision

    In calculating non-GAAP Income Tax Provision, we have added back the following to GAAP Income Tax Provision:

    • Tax effect of adjustments to GAAP results—Represents the estimated income tax effect of the adjustments to non-GAAP Profit before Tax described below and elimination of discrete tax adjustments.
    Reconciliation of Non-GAAP Gross Profit and Non-GAAP Gross Margin  
                                   
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Dollars in thousands)     (Dollars in thousands)  
    GAAP Gross Profit   $ 81,215     $ 85,662     $ 133,828     $ 241,648     $ 451,281  
    GAAP Gross Margin (% of net sales)     45.7 %     45.7 %     52.5 %     45.4 %     55.8 %
                                   
    Non-GAAP adjustments                              
    Transaction-related costs     5       10       523       14       523  
    Purchased intangible amortization     4,875       4,875       3,648       14,625       4,323  
    Restructuring costs     522       16       166       1,738       166  
    Stock-based compensation     802       817       1,073       2,180       4,625  
    Total Non-GAAP Adjustments   $ 6,204     $ 5,718     $ 5,410     $ 18,557     $ 9,637  
                                   
    Non-GAAP Gross Profit   $ 87,419     $ 91,380     $ 139,238     $ 260,205     $ 460,918  
    Non-GAAP Gross Margin (% of net sales)     49.1 %     48.8 %     54.6 %     48.9 %     57.0 %
    Reconciliation of Non-GAAP Operating Expenses  
                                   
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Dollars in thousands)     (Dollars in thousands)  
    GAAP Operating Expenses   $ 81,256     $ 81,595     $ 97,142     $ 248,252     $ 270,934  
                                   
    Research and Development Expenses                              
    GAAP Research and Development Expenses     43,317       43,510       44,396       132,031       130,799  
    Non-GAAP adjustments                              
    Transaction-related costs     333       206       343       1,568       352  
    Restructuring costs     568       260       908       997       908  
    Stock-based compensation     3,960       3,523       3,870       11,218       10,340  
    Other costs(1)     —       3       —       3       —  
    Non-GAAP Research and Development Expenses     38,456       39,518       39,275       118,245       119,199  
                                   
    Selling, General and Administrative Expenses                              
    GAAP Selling, General and Administrative Expenses     37,939       38,085       52,746       116,221       140,135  
    Non-GAAP adjustments                              
    Transaction-related costs     148       275       9,543       1,237       14,419  
    Purchased intangible amortization     535       535       495       1,605       1,210  
    Restructuring costs     1,264       2,046       5,795       4,355       5,795  
    Stock-based compensation     5,826       7,205       5,977       18,853       17,874  
    Other costs(1)     391       (1,820 )     283       (618 )     383  
    Non-GAAP Selling, General and Administrative Expenses     29,775       29,844       30,653       90,789       100,454  
                                   
    Total Non-GAAP Adjustments     13,025       12,233       27,214       39,218       51,281  
                                   
    Non-GAAP Operating Expenses   $ 68,231     $ 69,362     $ 69,928     $ 209,034     $ 219,653  
                                   
    (1) Included in non-GAAP other costs are non-recurring charges that are individually immaterial for separate disclosure, such as project evaluation costs, which consist of costs and estimated costs incurred in connection with debt and equity financings or other non-recurring transactions.  
    Reconciliation of Non-GAAP Operating Income and Non-GAAP Operating Margin  
                                   
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Dollars in thousands)     (Dollars in thousands)  
    GAAP Operating (Loss) Income   $ (41 )   $ 4,067     $ 36,686     $ (6,604 )   $ 180,347  
    GAAP Operating Margin (% of net sales)     — %     2.2 %     14.4 %     (1.2 )%     22.3 %
                                   
    Transaction-related costs     486       491       10,409       2,819       15,294  
    Purchased intangible amortization     5,410       5,410       4,143       16,230       5,533  
    Restructuring costs     2,354       2,322       6,869       7,090       6,869  
    Stock-based compensation     10,588       11,545       10,920       32,251       32,839  
    Other costs(1)     391       (1,817 )     283       (615 )     383  
    Total Non-GAAP Adjustments   $ 19,229     $ 17,951     $ 32,624     $ 57,775     $ 60,918  
                                   
    Non-GAAP Operating Income   $ 19,188     $ 22,018     $ 69,310     $ 51,171     $ 241,265  
    Non-GAAP Operating Margin (% of net sales)     10.8 %     11.7 %     27.2 %     9.6 %     29.8 %
                                   
    (1) Included in non-GAAP other costs are non-recurring charges that are individually immaterial for separate disclosure, such as project evaluation costs, which consist of costs and estimated costs incurred in connection with debt and equity financings or other non-recurring transactions.  
    Reconciliation of EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin  
                                   
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Dollars in thousands)     (Dollars in thousands)  
    GAAP Net (Loss) Income   $ (6,799 )   $ (33,613 )   $ 33,402     $ (58,025 )   $ 159,962  
    GAAP Net (Loss) Income Margin (% of net sales)     (3.8 )%     (17.9 )%     13.1 %     (10.9 )%     19.8 %
                                   
    Interest expense     7,762       10,353       3,854       23,492       5,381  
    Interest income     (388 )     (420 )     (857 )     (1,302 )     (2,550 )
    Income tax (benefit) provision     (803 )     (9,470 )     2,969       (9,233 )     17,584  
    Depreciation & amortization     16,123       15,997       20,227       48,578       49,645  
    EBITDA   $ 15,895     $ (17,153 )   $ 59,595     $ 3,510     $ 230,022  
                                   
    Transaction-related costs     486       3,295       10,409       5,623       15,294  
    Restructuring costs     2,354       2,067       6,869       6,835       6,869  
    Stock-based compensation     10,588       11,545       10,920       32,251       32,839  
    Loss on change in fair value of forward repurchase contract     —       34,752       —       34,752       —  
    Other costs(1)     998       (2,195 )     (551 )     1,610       5,339  
    Adjusted EBITDA   $ 30,321     $ 32,311     $ 87,242     $ 84,581     $ 290,363  
    Adjusted EBITDA Margin (% of net sales)     17.0 %     17.2 %     34.2 %     15.9 %     35.9 %
                                   
    (1) Included in non-GAAP other costs are non-recurring charges that are individually immaterial for separate disclosure, such as project evaluation costs, which consist of costs and estimated costs incurred in connection with debt and equity financings or other non-recurring transactions, and income (loss) in earnings of equity investments.  
    Reconciliation of Non-GAAP Profit before Tax  
                                   
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Dollars in thousands)     (Dollars in thousands)  
    GAAP (Loss) Income before Income Taxes   $ (7,602 )   $ (43,083 )   $ 36,371     $ (67,258 )   $ 177,546  
                                   
    Transaction-related costs     486       3,295       10,409       5,623       15,294  
    Transaction-related interest     192       141       162       1,042       162  
    Purchased intangible amortization     5,410       5,410       4,143       16,230       5,533  
    Restructuring costs     2,354       2,067       6,869       6,835       6,869  
    Stock-based compensation     10,588       11,545       10,920       32,251       32,839  
    Loss on change in fair value of forward repurchase contract     —       34,752       —       34,752       —  
    Other costs(1)     1,427       1,428       (551 )     5,662       5,339  
    Total Non-GAAP Adjustments   $ 20,457     $ 58,638     $ 31,952     $ 102,395     $ 66,036  
                                   
    Non-GAAP Profit before Tax   $ 12,855     $ 15,555     $ 68,323     $ 35,137     $ 243,582  
                                   
    (1) Included in non-GAAP other costs are non-recurring charges that are individually immaterial for separate disclosure, such as project evaluation costs, which consist of costs and estimated costs incurred in connection with debt and equity financings or other non-recurring transactions, and income (loss) in earnings of equity investments.  
    Reconciliation of Non-GAAP Income Tax Provision and Non-GAAP Effective Tax Rate  
                                   
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Dollars in thousands)     (Dollars in thousands)  
    GAAP Income Tax (Benefit) Provision   $ (803 )   $ (9,470 )   $ 2,969     $ (9,233 )   $ 17,584  
    GAAP effective tax rate     10.6 %     22.0 %     8.2 %     13.7 %     9.9 %
                                   
    Tax effect of adjustments to GAAP results     398       10,071       3,748       10,074       10,128  
                                   
    Non-GAAP Income Tax (Benefit) Provision   $ (405 )   $ 601     $ 6,717     $ 841     $ 27,712  
    Non-GAAP effective tax rate     (3.2 )%     3.9 %     9.8 %     2.4 %     11.4 %
    Reconciliation of Non-GAAP Net Income Attributable to Allegro MicroSystems, Inc. and Non-GAAP Earnings per Share  
                                   
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Dollars in thousands)     (Dollars in thousands)  
    GAAP Net (Loss) Income Attributable to Allegro MicroSystems, Inc.(1)   $ (6,860 )   $ (33,675 )   $ 33,345     $ (58,210 )   $ 159,812  
    GAAP Basic weighted average common shares     184,011,189       189,182,850       192,724,541       188,886,583       192,384,315  
    GAAP Diluted weighted average common shares     184,011,189       189,182,850       194,570,380       188,886,583       194,925,040  
    GAAP Basic (Loss) Earnings per Share   $ (0.04 )   $ (0.18 )   $ 0.17     $ (0.31 )   $ 0.83  
    GAAP Diluted (Loss) Earnings per Share   $ (0.04 )   $ (0.18 )   $ 0.17     $ (0.31 )   $ 0.82  
                                   
    Transaction-related costs     486       3,295       10,409       5,623       15,294  
    Transaction-related interest     192       141       162       1,042       162  
    Purchased intangible amortization     5,410       5,410       4,143       16,230       5,533  
    Restructuring costs     2,354       2,067       6,869       6,835       6,869  
    Stock-based compensation     10,588       11,545       10,920       32,251       32,839  
    Loss on change in fair value of forward repurchase contract     —       34,752       —       34,752       —  
    Other costs(2)     1,427       1,428       (551 )     5,662       5,339  
    Total Non-GAAP Adjustments     20,457       58,638       31,952       102,395       66,036  
    Tax effect of adjustments to GAAP results(3)     (398 )     (10,071 )     (3,748 )     (10,074 )     (10,128 )
    Non-GAAP Net Income Attributable to Allegro MicroSystems, Inc.   $ 13,199     $ 14,892     $ 61,549     $ 34,111     $ 215,720  
    Basic weighted average common shares     184,011,189       189,182,850       192,724,541       188,886,583       192,384,315  
    Diluted weighted average common shares     184,485,792       189,710,595       194,570,380       189,577,693       194,925,040  
    Non-GAAP Basic Earnings per Share   $ 0.07     $ 0.08     $ 0.32     $ 0.18     $ 1.12  
    Non-GAAP Diluted Earnings per Share   $ 0.07     $ 0.08     $ 0.32     $ 0.18     $ 1.11  
                                   
    (1) GAAP Net (Loss) Income Attributable to Allegro MicroSystems, Inc. represents GAAP Net (Loss) Income adjusted for Net Income Attributable to non-controlling interests.  
    (2) Included in non-GAAP other costs are non-recurring charges that are individually immaterial for separate disclosure, such as project evaluation costs, which consists of costs and estimated costs incurred in connection with debt and equity financings or other non-recurring transactions, income (loss) in earnings of equity investments, and unrealized losses (gains) on investments.  
    (3) To calculate the tax effect of adjustments to GAAP results, the Company considers each non-GAAP adjustment by tax jurisdiction and reverses all discrete items to calculate an annual non-GAAP effective tax rate (“NG ETR”).  This NG ETR is then applied to Non-GAAP Profit Before Tax to arrive at the tax effect of adjustments to GAAP results.  
    Reconciliation of Non-GAAP Free Cash Flow and Non-GAAP Free Cash Flow as Percentage of Net Sales        
                                   
        Three-Month Period Ended     Nine-Month Period Ended  
        December 27, 2024     September 27, 2024     December 29, 2023     December 27, 2024     December 29, 2023  
        (Dollars in thousands)     (Dollars in thousands)  
    GAAP Operating Cash Flow   $ (8,183 )   $ 15,547     $ 76,558     $ 41,560     $ 168,951  
    GAAP Operating Cash Flow (% of net sales)     -4.6 %     8.3 %     30.0 %     7.8 %     20.9 %
    Non-GAAP adjustments                              
    Purchases of property, plant and equipment     (13,615 )     (9,972 )     (34,399 )     (34,564 )     (110,500 )
                                   
    Non-GAAP Free Cash Flow   $ (21,798 )   $ 5,575     $ 42,159     $ 6,996     $ 58,451  
    Non-GAAP Free Cash Flow (% of net sales)     (12.3 )%     3.0 %     16.5 %     1.3 %     7.2 %

    Investor Contact:
    Jalene Hoover
    VP of Investor Relations & Corporate Communications
    +1 (512) 751-6526
    jhoover@allegromicro.com

    The MIL Network –

  • MIL-OSI: CSW Industrials Reports Record Fiscal 2025 Third Quarter Results

    Source: GlobeNewswire (MIL-OSI)

    DALLAS, Jan. 30, 2025 (GLOBE NEWSWIRE) — CSW Industrials, Inc. (Nasdaq: CSWI or the “Company”) today reported record results for the fiscal 2025 third quarter period ended December 31, 2024.

    Fiscal 2025 Third Quarter Highlights (comparisons to fiscal 2024 third quarter)

    • Total revenue increased 10.7% to a third quarter record of $193.6 million, driven by inorganic growth of 8.7% from the recent acquisitions of Dust Free, PSP Products, and PF WaterWorks, and organic growth of 1.9%
    • Net income attributable to CSWI of $26.9 million, or $24.9 million adjusted, increased 48.9% to a third quarter record, compared to $16.7 million
    • Earnings per diluted share (“EPS”) of $1.60, or $1.48 adjusted, increased 38.2% to a third quarter record, compared to $1.07
    • Adjusted EBITDA grew 14.2% to a third quarter record of $42.0 million, including margin expansion for the third quarter of 70 bps to 21.7%

    Fiscal 2025 Year-to-Date Highlights (comparisons to fiscal 2024 year-to-date period)

    • Total revenue increased 11.3% to $647.8 million, of which $34.1 million, or 5.9%, was inorganic growth from recent acquisitions, and 5.5%, or $31.7 million was organic growth
    • Net income attributable to CSWI of $101.6 million, or $99.5 million adjusted, increased 28.6% as compared to $77.4 million
    • EPS of $6.30, or $6.17 adjusted, improved 24.2% compared to $4.97
    • Adjusted EBITDA increased 16.6% to $168.1 million, including margin expansion of 120 bps to 26.0%
    • Invested $84.5 million in acquisitions and $11.7 million in organic capital expenditures, while returning total cash of $24.3 million to shareholders through share repurchases of $13.7 million and dividends of $10.6 million

    Comments from the Chairman, President, and Chief Executive Officer

    Joseph B. Armes, CSW Industrials’ Chairman, President, and Chief Executive Officer, commented, “I am very pleased to announce record revenue for the fiscal third quarter driven by the strategic acquisitions of Dust Free, PSP Products, and PF WaterWorks during the last twelve months as well as organic volume growth. Impressively, the team also achieved record net income, adjusted earnings per diluted share, and adjusted EBITDA for the fiscal third quarter.”

    Armes continued, “During the quarter, our disciplined allocation of capital continued with the acquisition of PF WaterWorks, bringing innovative, eco-friendly drain management solutions within the profitable plumbing end market to the CSWI family. The addition of these new products to our current portfolio fuels inorganic growth, additional organic growth over time, and increased market share.”

    Fiscal 2025 Third Quarter Consolidated Results

    Fiscal third quarter revenue was $193.6 million, a $18.7 million or 10.7% increase over the prior year period. Total revenue growth included $15.3 million or 8.7% inorganic growth contributed by the Dust Free, PSP, and PF WaterWorks acquisitions, which are all reported within the Contractor Solutions segment, with the remaining $3.4 million or 1.9% related to organic growth contributed from all three operating segments.

    Gross profit in the fiscal third quarter was $80.1 million, representing 8.3% growth over $74.0 million in the prior year period. Gross margin contracted 90 bps to 41.4%, compared to 42.3% in the prior year period. The gross margin decrease was primarily a result of increased freight expense.

    Operating expenses as a percentage of revenue were 26.1% or 25.6% adjusted to exclude the $0.9 million acquisition broker fee in the current period, which was lower than the prior year period of 26.5%. Operating expenses were $50.5 million or $49.7 million adjusted in the current year period, compared to $46.4 million in the prior year period, with leverage of revenue growth through the absorption of expenses related to recent acquisitions, additional spend on acquisition integration, and investments in team members to support ongoing revenue growth.

    Operating income in the current period was $29.6 million or $30.5 million adjusted to exclude the acquisition broker fee, compared to $27.6 million in the prior year period. Operating income as a percentage of revenue was 15.3% or 15.7% adjusted, compared to 15.8% in the prior year period. The main driver of the slight decrease in operating margin was a result of the previously mentioned contraction in the gross margin, which was partially offset by improved leverage on operating expenses.

    Interest income was $2.0 million, compared to interest expense of $2.8 million in the prior year period. The $4.8 million shift from interest expense to interest income was a result of having no debt outstanding during the quarter, as the outstanding balance on our revolver was fully repaid in second fiscal quarter 2025, augmented by interest income earned on the balance of net proceeds from the equity offering closed in the second fiscal quarter 2025.

    Other expense was $0.3 million, compared to other expense of $8.4 million in the prior year period. A $0.9 million tax indemnification asset was released in the current period, as compared to $8.5 million of tax indemnification assets released in the prior year period.

    Net income attributable to CSWI (net of non-controlling interest in the joint venture) increased to $26.9 million, compared to the prior year period of $9.2 million. Adjusted to exclude the release of the tax indemnification assets and uncertain tax position accruals in the current and prior periods, as well as the acquisition broker fee in the current period, adjusted net income was $24.9 million and adjusted EPS of $1.48 vs. $16.7 million and $1.07, an increase over the prior year period of 48.9% and 38.2%, respectively.

    Fiscal 2025 third quarter adjusted EBITDA increased 14.2% to $42.0 million, up from $36.8 million in the prior year period. Adjusted EBITDA margin expanded 70 bps to 21.7%, compared to 21.0% in the prior year period.

    The quarterly cash flows from operations of $11.6 million, compared to $47.0 million in the prior year period, were lower primarily due to a previously disclosed $16.8 million tax payment deferral from fiscal first half 2025 to fiscal third quarter 2025 under a temporary federal tax relief related to the severe storms and flooding in Texas in early calendar 2024. Additionally, increased investment in inventory during the third fiscal quarter 2025, compared to the prior year period, resulted from actions taken to mitigate certain supply chain issues that were expected to potentially arise in the first calendar quarter of 2025.

    Following quarter-end, the Company announced its twenty-fourth consecutive regular quarterly cash dividend in the amount of $0.24 per share, which will be paid on February 14, 2025, to shareholders of record on January 31, 2025.

    The Company’s effective tax rate for the fiscal third quarter was 13.8%, or 24.5% adjusted, as compared to 43.2% or 32.5% adjusted in the prior year period, when adjusted to exclude the previously disclosed release of tax indemnification assets and the uncertain tax position accruals for acquisitions in both periods, as well as the acquisition broker fee and related tax impact in the current period. The decrease in the adjusted tax rate was driven by a favorable foreign currency rate impact on the cumulative unrepatriated foreign earnings and an increased benefit related to vesting of employee equity awards.

    Fiscal 2025 Third Quarter Segment Results

    Contractor Solutions segment revenue was $132.2 million, a $16.7 million or 14.5% increase over the prior year period, comprised of inorganic growth of $15.3 million from the recent acquisitions of Dust Free, PSP Products, and PF WaterWorks (91.4% of the $16.7 million growth) and organic growth of $1.4 million from increased organic unit volumes. As compared to the prior year period, net revenue growth was driven by the HVAC/R, plumbing, and electrical end markets. Segment operating income improved to $26.8 million or $27.6 million adjusted to exclude the $0.9 million acquisition broker fee, compared to $25.8 million in the prior year period. The incremental profit resulted from revenue growth and the inclusion of recently acquired businesses and was partially offset by increased freight, including a freight expense alignment in the quarter and increased spending on business integrations. Segment operating income margin in the fiscal third quarter was 20.2% or 20.9% adjusted, compared to 22.3% in the prior year period. Segment adjusted EBITDA in the fiscal third quarter was $37.5 million, or 28.4% of revenue, compared to $33.0 million, or 28.6% of revenue in the prior year period.

    Specialized Reliability Solutions segment revenue was $34.6 million, a $0.9 million or 2.5% increase from the prior year period. The increased net revenue was driven by growth in the general industrial and rail end markets. Segment operating income improved to $5.2 million, as compared to $3.7 million in the prior year period, an increase of 40.1%. Segment operating income margin for the fiscal third quarter improved to 15.2%, compared to the prior year period of 11.1% as a result of manufacturing efficiencies and management of operating expenses. Segment EBITDA improved by 26.5% to $6.6 million in the fiscal third quarter, with an EBITDA margin of 19.1% as compared to 15.4% in the prior year period.

    Engineered Building Solutions segment revenue was $28.8 million, a 3.4% increase compared to $27.9 million in the prior year period. Segment operating income was $3.6 million, or 12.6% of revenue, as compared to the prior year period of $3.5 million, or 12.7% of revenue. Segment EBITDA and EBITDA margin improved slightly to $4.1 million and 14.2%, respectively, in the fiscal third quarter, compared to $4.0 million and 14.2%, respectively, in the prior year period.

    Fiscal 2025 Year-to-Date Consolidated Results

    Fiscal year-to-date revenue was $647.8 million, representing 11.3% growth over $582.0 million in the prior year period, with growth in all three reporting segments. Of the $65.8 million total growth, $31.7 million (5.5% of the 11.3% total growth) resulted from organic growth, with the remainder ($34.1 million) contributed by the Dust Free, PSP Products, and PF WaterWorks acquisitions.

    Gross profit in the fiscal year-to-date period was $291.4 million, representing $34.3 million or 13.3% growth from $257.1 million in the prior year period, with the incremental profit resulting predominantly from revenue growth driven by increased organic unit volumes, a slight increase from pricing actions, and the recent acquisitions. Gross margin was 45.0%, compared to 44.2% in the prior year period. The gross margin improvement was a result of leveraging the volume increase, favorable product mix, and a slight favorable impact from pricing actions.

    Operating expenses as a percentage of revenue were 24.0% or 23.8% adjusted, compared to 24.5% in the prior year period, as the increase in revenue growth outpaced the increase in operating expenses. Operating expenses in the current year period were $155.2 million or $154.4 million adjusted to exclude the $0.9 million acquisition broker fee, compared to $142.3 million in the prior year period. The additional expenses were related to employee compensation and recent acquisition expenses including amortization of intangible assets, business development expenses, and integration costs.

    In the current period, operating income was $136.2 million or $137.1 million adjusted, compared to $114.8 million in the prior year period. The incremental operating income resulted from the gross profit increase, partially offset by the operating expense increase detailed above. Operating income margin in the current period improved to 21.0% or 21.2% adjusted, compared to the prior year period of 19.7%. During the comparative periods, the strengthened operating margin was due to the improvement in gross margin combined with the management of operating expenses.

    Interest expense was $1.9 million, compared to interest expense of $10.1 million in the prior year period. The decrease of $8.2 million was a result of a lower debt balance throughout the first half of the year, then fully repaying the outstanding balance borrowed against our revolver during the second fiscal quarter 2025. Additionally, during the second and third fiscal quarters, the Company recognized interest income earned from the remaining net proceeds of the equity offering that closed in second fiscal quarter 2025.

    Other expense was $0.7 million, compared to $6.2 million in the prior year period. The change in other expense of $5.5 million was primarily due to a $0.9 million tax indemnification asset was released in the current period, as compared to $8.5 million of tax indemnification assets released in the prior period, in addition to a gain of $1.4 million reported in the prior year period in connection with the sale of a property previously held for investment that did not recur. The remaining variance is a result of foreign currency impact related to transactions in currencies other than functional currencies.

    In the current period, reported net income attributable to CSWI improved 45.4% to $101.6 million, or $6.30 per diluted share. Adjusted net income attributable to CSWI was $99.5 million, or $6.17 per diluted share. In the prior year period, adjusted net income attributable to CSWI was $77.4 million, or $4.97 per diluted share.

    Fiscal 2025 year-to-date adjusted EBITDA increased 16.6% to $168.1 million from $144.2 million in the prior year period. Adjusted EBITDA as a percentage of revenue improved 120 bps to 26.0%, compared to 24.8%, in the prior year period.

    Net cash provided by operating activities for the fiscal 2025 year-to-date period was $141.1 million, compared to $141.9 million in the prior year-to-date period, a 0.6% decrease compared to the prior year period. The Company paid down all $166.0 million of debt in the first half utilizing our record cash flow from operations and net proceeds from the follow-on equity offering, while also returning a total of $24.3 million in cash to shareholders through $10.6 million in dividends and $13.7 million in share repurchases utilizing our outstanding cash flow from operations.

    The Company’s effective tax rate for the fiscal year-to-date period was 23.3% on a GAAP basis, and 25.8% as adjusted.

    Fiscal 2025 Year-to-Date Segment Results

    Contractor Solutions segment revenue was $451.4 million, a $56.1 million or 14.2% increase from the prior year period. Revenue growth was comprised of inorganic growth from Dust Free, PSP Products, and PF WaterWorks acquisitions ($34.1 million, or 8.6%, of the total growth), and organic growth of $22.1 million (5.6% of the total 14.2% growth) due to increased unit volumes and a slight increase from pricing actions. As compared to the prior year period, net revenue growth was driven primarily by the HVAC/R, plumbing, and electrical end markets. Segment operating income in the current year period was $122.9 million or $123.8 million adjusted to exclude the $0.9 million acquisition broker fee, compared to $104.4 million in the prior year period. The incremental profit resulted from the increased unit volumes, favorable product mix, pricing actions, and the inclusion of recent acquisitions. This growth was partially offset by increased freight expense, increased employee compensation expense, and business integration costs as the segment builds out the infrastructure to support continued growth, and increased expenses related to the inclusion of Dust Free, PSP Products, and PF WaterWorks in the current period, including amortization of intangible assets.

    Contractor Solutions segment operating income margin was 27.2% or 27.4% adjusted, compared to 26.4% in the prior year period, an increase of 80 bps, driven primarily by increased operating leverage from the additional volume, favorable product mix and pricing actions, combined with the management of operating expenses. Segment adjusted EBITDA in the current period was $149.4 million, or 33.1% of revenue, compared to $126.4 million, or 32.0% of revenue in the prior year period.

    Specialized Reliability Solutions segment revenue grew to $109.9 million, a $1.9 million or 1.7% increase over the prior year period of $108.0 million, primarily due to increased unit volumes, with growth in the rail transportation and industrial end markets offset by a decrease in mining and energy end markets. In the current year period, segment operating income improved by 17.2% to $18.2 million, or 16.6% of revenue, compared to the prior year period of $15.5 million, or 14.4% of revenue. Improved segment operating income was primarily a result of a favorable inventory adjustment as well as the increased volume. Segment EBITDA in the current period was $22.2 million, or 20.2% of revenue, compared to $19.9 million, or 18.5% of revenue in the prior year period.

    Engineered Building Solutions segment revenue was $92.4 million, a $7.7 million or 9.1% increase over the prior year period, primarily due to the conversion of backlog into revenue and market expansion. Segment operating income increased 18.6% to $15.5 million, or 16.7% of revenue, compared to the prior year period of $13.0 million, or 15.4% of revenue, due to the increased net revenue and improved operating leverage, offset by increased employee expenses to support revenue growth. Segment EBITDA in the current period was $16.9 million, or 18.3% of revenue, compared to $14.4 million, or 17.0% of revenue in the prior year period.

    All percentages are calculated based upon the attached financial statements. Share count used in determining the diluted EPS is based on a weighted average of outstanding shares throughout the reporting period.

    Conference Call Information

    The Company will host a conference call today at 10:00 a.m. ET to discuss the results, followed by a question-and-answer session for the investment community. A live webcast of the call can be accessed at https://cswindustrials.gcs-web.com/. To access the call, participants may dial 1-877-407-0784, international callers may use 1-201-689-8560, and request to join the CSW Industrials earnings call.

    A telephonic replay will be available shortly after the conclusion of the call and until Thursday, February 13, 2025. Participants may access the replay at 1-844-512-2921, international callers may use 1-412-317-6671 and enter access code 13750887. The call will also be available for replay via webcast link on the Investors portion of the CSWI website www.cswindustrials.com.

    Safe Harbor Statement

    This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Words or phrases such as “may,” “should,” “expects,” “could,” “intends,” “plans,” “anticipates,” “estimates,” “believes,” “forecasts,” “predicts” or other similar expressions are intended to identify forward-looking statements, which include, without limitation, earnings forecasts, effective tax rate, statements relating to our business strategy and statements of expectations, beliefs, future plans and strategies and anticipated developments concerning our industry, business, operations, and financial performance and condition.

    The forward-looking statements included in this press release are based on our current expectations, projections, estimates, and assumptions. These statements are only predictions, not guarantees. Such forward-looking statements are subject to numerous risks and uncertainties that are difficult to predict. These risks and uncertainties may cause actual results to differ materially from what is forecast in such forward-looking statements, and include, without limitation, the risk factors described from time to time in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K.

    All forward-looking statements included in this press release are based on information currently available to us, and we assume no obligation to update any forward-looking statement except as may be required by law.

    Non-GAAP Financial Measures

    This press release includes an analysis of adjusted diluted earnings per share attributable to CSWI, adjusted net income attributable to CSWI, adjusted effective tax rate, adjusted operating income and free cash flows, which are non-GAAP financial measures of performance. Attributable to CSWI is defined to exclude the income attributable to the non-controlling interest in the Whitmore JV.

    CSWI utilizes adjusted EBITDA (earnings before interest, tax, depreciation and amortization) as an additional consolidated, non-GAAP financial measure, which consists of consolidated net income including income attributable to the non-controlling interest in the Whitmore JV, adjusted to remove the impact of income taxes, interest expense, depreciation, amortization and impairment, and significant nonrecurring items.

    For a reconciliation of these measures to the most directly comparable GAAP measures and for a discussion of why we consider these non-GAAP measures useful, see the “Reconciliation of Non-GAAP Measures” section of this release.

    About CSW Industrials, Inc.

    CSW Industrials is a diversified industrial growth company with industry-leading operations in three segments: Contractor Solutions, Specialized Reliability Solutions, and Engineered Building Solutions. CSWI provides niche, value-added products with two essential commonalities: performance and reliability. The primary end markets we serve with our well-known brands include: HVAC/R, plumbing, electrical, general industrial, architecturally-specified building products, energy, mining, and rail transportation. For more information, please visit www.cswindustrials.com.

    Investor Relations

    Alexa Huerta
    Vice President, Investor Relations and Treasurer
    214-489-7113
    alexa.huerta@cswindustrials.com

     
    CSW INDUSTRIALS, INC.
    CONSOLIDATED STATEMENTS OF INCOME
    (unaudited)
     
        Three Months Ended
    December 31,    		   Nine Months Ended
    December 31,
    (Amounts in thousands, except per share amounts)     2024       2023       2024       2023  
    Revenues, net   $ 193,649     $ 174,967     $ 647,752     $ 581,980  
    Cost of revenues     (113,543 )     (100,986 )     (356,324 )     (324,873 )
    Gross profit     80,106       73,981       291,428       257,107  
    Selling, general and administrative expenses     (50,511 )     (46,400 )     (155,224 )     (142,327 )
    Operating income     29,595       27,581       136,204       114,780  
    Interest income (expense), net     1,976       (2,765 )     (1,884 )     (10,080 )
    Other expense, net     (298 )     (8,428 )     (716 )     (6,188 )
    Income before income taxes     31,273       16,388       133,604       98,512  
    Provision for income taxes     (4,315 )     (7,083 )     (31,175 )     (27,968 )
    Net income     26,958       9,305       102,429       70,544  
    Less: Income attributable to redeemable noncontrolling interest     (10 )     (83 )     (839 )     (655 )
    Net income attributable to CSW Industrials, Inc.   $ 26,948     $ 9,222     $ 101,590     $ 69,889  
                     
    Net income per share attributable to CSW Industrials, Inc.                
    Basic   $ 1.60     $ 0.59     $ 6.32     $ 4.50  
    Diluted     1.60       0.59       6.30       4.49  
                     
    Weighted average number of shares outstanding:                
    Basic     16,792       15,546       16,066       15,537  
    Diluted     16,872       15,596       16,136       15,578  
    CSW INDUSTRIALS, INC.
    CONSOLIDATED BALANCE SHEETS
    (unaudited)
     
    (Amounts in thousands, except for per share amounts)   December 31, 2024   March 31, 2024
    ASSETS        
    Current assets:        
    Cash and cash equivalents   $ 213,754     $ 22,156  
    Accounts receivable, net of allowance for expected credit losses of $1,295 and $908, respectively     114,825       142,665  
    Inventories, net     202,764       150,749  
    Prepaid expenses and other current assets     32,120       15,840  
    Total current assets     563,463       331,410  
    Property, plant and equipment, net of accumulated depreciation of $112,906 and $103,515, respectively     94,208       92,811  
    Goodwill     266,941       247,191  
    Intangible assets, net     355,256       318,819  
    Other assets     70,327       53,095  
    Total assets   $ 1,350,195     $ 1,043,326  
             
    LIABILITIES AND EQUITY        
    Current liabilities:        
    Accounts payable   $ 52,842     $ 48,387  
    Accrued and other current liabilities     81,873       67,449  
    Total current liabilities     134,715       115,836  
    Long-term debt     —       166,000  
    Retirement benefits payable     1,082       1,114  
    Other long-term liabilities     150,181       125,298  
    Total liabilities     285,978       408,248  
    Commitments and contingencies (See Note 13)        
    Redeemable noncontrolling interest     20,194       19,355  
    Equity:        
    Common shares, $0.01 par value     177       164  
    Additional paid-in capital     497,906       137,253  
    Treasury shares, at cost (1,005 and 952 shares, respectively)     (115,367 )     (95,643 )
    Retained earnings     674,036       583,075  
    Accumulated other comprehensive loss     (12,729 )     (9,126 )
    Total equity     1,044,023       615,723  
    Total liabilities, redeemable noncontrolling interest and equity   $ 1,350,195     $ 1,043,326  
    CSW INDUSTRIALS, INC.
    CONSOLIDATED STATEMENTS OF CASH FLOWS
    (unaudited)
     
        Nine Months Ended
    December 31,
    (Amounts in thousands)     2024       2023  
    Cash flows from operating activities:        
    Net income   $ 102,429     $ 70,544  
    Adjustments to reconcile net income to net cash provided by operating activities:        
    Depreciation     10,714       10,077  
    Amortization of intangible and other assets     20,792       17,584  
    Provision for inventory reserves     1,779       2,541  
    Provision for doubtful accounts     946       544  
    Share-based compensation     10,237       8,555  
    Net gain on disposals of property, plant and equipment     (89 )     (1,336 )
    Net pension benefit     49       50  
    Impairment of assets     —       90  
    Net deferred taxes     1,244       2,732  
    Changes in operating assets and liabilities:        
    Accounts receivable     32,316       17,846  
    Inventories     (42,536 )     7,796  
    Prepaid expenses and other current assets     (17,174 )     (6,720 )
    Other assets     1,565       1,066  
    Accounts payable and other current liabilities     21,372       9,601  
    Retirement benefits payable and other liabilities     (2,575 )     944  
    Net cash provided by operating activities     141,069       141,914  
    Cash flows from investing activities:        
    Capital expenditures     (11,735 )     (11,668 )
    Proceeds from sale of assets held for investment     —       1,665  
    Proceeds from sale of assets     153       157  
    Cash paid for investments     (2,500 )     —  
    Cash paid for acquisitions     (84,491 )     (5,284 )
    Net cash used in investing activities     (98,573 )     (15,130 )
    Cash flows from financing activities:        
    Borrowings on line of credit     32,723       72,308  
    Repayments of line of credit and term loan     (198,723 )     (172,308 )
    Purchase of treasury shares     (20,935 )     (10,640 )
    Proceeds from equity issuance     347,407       —  
    Dividends     (10,554 )     (8,855 )
    Net cash provided by (used in) financing activities     149,918       (119,495 )
    Effect of exchange rate changes on cash and equivalents     (816 )     (756 )
    Net change in cash and cash equivalents     191,598       6,533  
    Cash and cash equivalents, beginning of period     22,156       18,455  
    Cash and cash equivalents, end of period   $ 213,754     $ 24,988  


    Reconciliation of Non-GAAP Measures

    We use adjusted earnings per share attributable to CSWI, adjusted net income attributable to CSWI, adjusted operating income, adjusted effective tax rate, and adjusted EBITDA, together with financial measures prepared in accordance with GAAP, such as revenue, cost of revenue, operating expense, operating income and net income attributable to CSWI, to assess our historical and prospective operating performance and to enhance our understanding of our core operating performance. Free cash flow is a non-GAAP financial measure and is defined as cash flow from operations less capital expenditures. We also believe these measures are useful for investors to assess the operating performance of our business without the effect of non-recurring items. In the following tables, there could be immaterial differences in amounts presented due to rounding.

     
    CSW INDUSTRIALS, INC.
    RECONCILIATION OF NET INCOME ATTRIBUTABLE TO CSWI TO ADJUSTED NET INCOME ATTRIBUTABLE TO CSWI
    (Unaudited)
                     
    (Amounts in thousands)   Three months ended
    December 31,    		   Nine Months ended
    December 31,
          2024       2023       2024       2023  
    GAAP net income attributable to CSWI   $ 26,948     $ 9,222     $ 101,591     $ 69,889  
                     
    Adjusting items, net of tax:                
    Reversal of tax indemnification receivable     858       8,519       858       8,519  
    Acquisition broker fee     642       —       642       —  
    Uncertain tax position accrual release     (3,549 )     (1,019 )     (3,549 )     (1,019 )
    Adjusted net income attributable to CSWI   $ 24,899     $ 16,722     $ 99,542     $ 77,389  
                     
    Net Income Attributable to CSW Industrials, Inc. per diluted common share   $ 1.60     $ 0.59     $ 6.30     $ 4.49  
                     
    Adjusting Items, per dilutive common share:                
    Reversal of tax indemnification receivable     0.05       0.55       0.05       0.55  
    Acquisition broker fee     0.04       —       0.04       —  
    Uncertain tax position accrual release     (0.21 )     (0.07 )     (0.22 )     (0.07 )
    Adjusted net income attributable to CSW Industrials, Inc. per dilutive common share   $ 1.48     $ 1.07     $ 6.17     $ 4.97  
    CSW INDUSTRIALS, INC.
    RECONCILIATION OF EFFECTIVE TAX RATE TO ADJUSTED EFFECTIVE TAX RATE
    (Unaudited)
                     
    (Amounts in thousands)   Three months ended
    December 31,    		   Nine Months ended
    December 31,
          2024       2023       2024       2023  
    GAAP income before tax   $ 31,273     $ 16,388     $ 133,604     $ 98,512  
    Adjusting items:                
    Reversal of tax indemnification receivable     858       8,519       858       8,519  
    Acquisition broker fee     860       —       860       —  
    Adjusted income before tax   $ 32,991     $ 24,907     $ 135,322     $ 107,031  
                     
    GAAP provision for income tax   $ 4,315     $ 7,083     $ 31,174     $ 27,968  
    Adjusting items:                
    Uncertain tax position accrual release     3,549       1,019       3,549       1,019  
    Tax impact of acquisition broker fee     218       —       218       —  
    Adjusted provision for income tax   $ 8,082     $ 8,102     $ 34,941     $ 28,987  
                     
    GAAP effective tax rate     13.8 %     43.2 %     23.3 %     28.4 %
    Adjusted effective tax rate     24.5 %     32.5 %     25.8 %     27.1 %
    CSW INDUSTRIALS, INC.
    Reconciliation of Net Income Attributable to CSWI to Adjusted EBITDA
    (unaudited)
                     
    (Amounts in thousands)   Three months ended
    December 31,    		   Nine Months ended
    December 31,
          2024       2023       2024       2023  
    Net Income attributable to CSWI   $ 26,948     $ 9,222     $ 101,590     $ 69,889  
    Plus: Income attributable to redeemable noncontrolling interest     10       83       838       655  
    Net Income   $ 26,958     $ 9,305     $ 102,429     $ 70,544  
                     
    Adjusting Items:                
    Interest expense (income), net     (1,976 )     2,764       1,884       10,080  
    Income tax expense     4,315       7,083       31,174       27,968  
    Depreciation & amortization     11,012       9,134       30,896       27,094  
    EBITDA   $ 40,309     $ 28,286     $ 166,384     $ 135,686  
                     
    EBITDA Adjustments:                
    Reversal of tax indemnification receivable     858       8,519       858       8,519  
    Acquisition broker fee     860       —       860       —  
    Adjusted EBITDA   $ 42,027     $ 36,805     $ 168,102     $ 144,205  
    Adjusted EBITDA % Revenue     21.7 %     21.0 %     26.0 %     24.8 %
    CSW INDUSTRIALS, INC.
    Reconciliation of Segment Operating Income to Segment Adjusted EBITDA
    (unaudited)
                 
    (Amounts in thousands)   Three months ended December 31, 2024
        Contractor
    Solutions    		 Specialized
    Reliability
    Solutions    		 Engineered
    Building
    Solutions    		 Corporate
    and Other    		 Consolidated
    Revenue, net   $ 132,150   $ 34,566   $ 28,821   $ (1,889 ) $ 193,649  
                 
    Operating Income   $ 26,756   $ 5,238   $ 3,645   $ (6,045 ) $ 29,595  
    Adjusting Items:            
    Acquisition broker fee     860     —     —     —     860  
    Adjusted Operating Income   $ 27,616   $ 5,238   $ 3,645   $ (6,045 ) $ 30,455  
    % Revenue     20.9 %   15.2 %   12.6 %     15.7 %
                 
    Adjusting Items:            
    Other income (expense), net     (188 )   (17 )   38     (131 )   (298 )
    Depreciation & amortization     9,179     1,366     420     48     11,012  
    Reversal of tax indemnification receivable     858     —     —     —     858  
    Adjusted EBITDA   $ 37,466   $ 6,587   $ 4,102   $ (6,128 ) $ 42,027  
    % Revenue     28.4 %   19.1 %   14.2 %     21.7 %
                 
    (Amounts in thousands)   Three months ended December 31, 2023
        Contractor
    Solutions    		 Specialized
    Reliability
    Solutions    		 Engineered
    Building
    Solutions    		 Corporate
    and Other    		 Consolidated
    Revenue, net   $ 115,412   $ 33,711   $ 27,861   $ (2,017 ) $ 174,967  
                 
    Operating Income   $ 25,751   $ 3,740   $ 3,537   $ (5,447 ) $ 27,581  
    % Revenue     22.3 %   11.1 %   12.7 %     15.8 %
                 
    Adjusting Items:            
    Other income (expense), net     (8,433 )   (9 )   (8 )   21     (8,428 )
    Depreciation & amortization     7,178     1,477     437     42     9,134  
    Reversal of tax indemnification receivable     8,519     —     —     —     8,519  
    Adjusted EBITDA   $ 33,015   $ 5,208   $ 3,966   $ (5,383 ) $ 36,805  
    % Revenue     28.6 %   15.4 %   14.2 %     21.0 %
    CSW INDUSTRIALS, INC.
    Reconciliation of Segment Operating Income to Segment Adjusted EBITDA
    (unaudited)
                 
    (Amounts in thousands)   Nine Months ended December 31, 2024
        Contractor
    Solutions    		 Specialized
    Reliability
    Solutions    		 Engineered
    Building
    Solutions    		 Corporate
    and Other    		 Consolidated
    Revenue, net   $ 451,403   $ 109,893   $ 92,387   $ (5,930 ) $ 647,754  
                 
    Operating Income   $ 122,894   $ 18,208   $ 15,451   $ (20,348 ) $ 136,204  
    Adjusting Items:            
    Acquisition broker fee     860     —     —     —     860  
    Adjusted Operating Income   $ 123,754   $ 18,208   $ 15,451   $ (20,348 ) $ 137,064  
    % Revenue     27.4 %   16.6 %   16.7 %     21.2 %
                 
    Adjusting Items:            
    Other income (expense), net     (335 )   (200 )   18     (200 )   (716 )
    Depreciation & amortization     25,164     4,198     1,399     135     30,896  
    Reversal of tax indemnification receivable     858     —     —     —     858  
    Adjusted EBITDA   $ 149,442   $ 22,206   $ 16,868   $ (20,413 ) $ 168,102  
    % Revenue     33.1 %   20.2 %   18.3 %     26.0 %
                 
    (Amounts in thousands)   Nine Months ended December 31, 2023
        Contractor
    Solutions    		 Specialized
    Reliability
    Solutions    		 Engineered
    Building
    Solutions    		 Corporate
    and Other    		 Consolidated
    Revenue, net   $ 395,268   $ 108,037   $ 84,660   $ (5,984 ) $ 581,980  
                 
    Operating Income   $ 104,443   $ 15,534   $ 13,029   $ (18,227 ) $ 114,780  
    % Revenue     26.4 %   14.4 %   15.4 %     19.7 %
                 
    Adjusting Items:            
    Other income (expense), net     (7,686 )   (100 )   2     1,595     (6,188 )
    Depreciation & amortization     21,118     4,512     1,332     132     27,094  
    Reversal of tax indemnification receivable     8,519     —     —     —     8,519  
    Adjusted EBITDA   $ 126,394   $ 19,947   $ 14,363   $ (16,500 ) $ 144,205  
    % Revenue     32.0 %   18.5 %   17.0 %     24.8 %
    CSW INDUSTRIALS, INC.
    Reconciliation of Operating Cash Flow to Free Cash Flow
    (Unaudited)
                     
    (Amounts in thousands)   Three Months Ended
    December 31,    		   Nine Months ended
    December 31,
          2024       2023       2024       2023  
    Net cash provided by operating activities   $ 11,600     $ 46,978     $ 141,069     $ 141,914  
    Less: Capital expenditures     (3,148 )     (3,883 )     (11,735 )     (11,668 )
    Free cash flow   $ 8,452     $ 43,095     $ 129,334     $ 130,246  
    Free cash flow % Adjusted EBITDA     20.1 %     117.1 %     76.9 %     90.3 %

    The MIL Network –

  • MIL-OSI: Real Matters Reports First Quarter Financial Results

    Source: GlobeNewswire (MIL-OSI)

    TORONTO, Jan. 30, 2025 (GLOBE NEWSWIRE) — Real Matters Inc. (TSX: REAL) (“Real Matters” or the “Company”), a leading network management services platform for the mortgage and insurance industries, today announced its financial results for the first quarter ended December 31, 2024.

    “We reported consolidated revenue of $41.0 million in the first quarter, up 16% year-over-year, and consolidated Net Revenue(A) increased 12% led by growth in all three segments. Refinance origination volumes in our U.S. Title segment were up 46% year-over-year and Net Revenue(A) margins increased by 610 basis points,” said Real Matters Chief Executive Officer Brian Lang.

    “There are now 8.8 million outstanding mortgages with interest rates above 6%, which represents a sizeable pool of potential refinance candidates. We are encouraged by the market opportunity we saw as a result of a short-term rally in rates in September – adding to our conviction of the market potential for refinance going forward. As a result, we are seeing broad pipeline movement; we are confident that we will have new, active franchise title clients in the coming months,” added Lang.

    “We have a strong balance sheet, and we will continue to prudently manage our cost base to align with market conditions, ensuring we focus on growth as headwinds turn to tailwinds for our business. We are at a key inflection point for our title business,” concluded Lang.

    Q1 2025 Highlights

    • Consolidated revenue of $41.0 million –16% year-over-year increase
    • Consolidated Net Revenue(A) of $10.9 million – 12% year-over-year increase
    • Adjusted EBITDA(A) loss of $1.7 million compared with loss of $1.1 million in Q1’24
    • Net income of $2.3 million up from net loss of $3.6 million in Q1’24
    • Launched five new clients
    • Significant operating leverage in Canadian segment – converted 90% of the incremental Net Revenue(A) to Adjusted EBITDA(A) in Q1’25
    • Cash and cash equivalents of $49.0 million and no outstanding debt as at December 31, 2024

    Financial and Operational Summary

        Quarter ended      
      2025 2024 2024 2024 2024     % Change1
        Q1     Q4     Q3     Q2     Q1     Quarter
    over
    Quarter    		 Year
    over
    Year
    Consolidated                          
    Revenue $ 41.0   $ 45.6   $ 49.5   $ 42.2   $ 35.4     -10 % 16 %
    Net Revenue(A) $ 10.9   $ 12.0   $ 13.1   $ 11.5   $ 9.7     -10 % 12 %
    Adjusted EBITDA(A) $ (1.7 ) $ 0.6   $ 1.7   $ 0.7   $ (1.1 )   -395 % -54 %
    Net income (loss) $ 2.3   $ (0.2 ) $ 1.7   $ 2.1   $ (3.6 )   1,562 % 163 %
    Net income (loss) per diluted share $ 0.03   $ 0.00   $ 0.02   $ 0.03   $ (0.05 )   0 % 160 %
    Adjusted Net (loss) income(A) $ (0.3 ) $ 0.9   $ 1.7   $ 1.3   $ (1.2 )   -129 % 75 %
    Adjusted Net (loss) income(A) per diluted share $ 0.00   $ 0.01   $ 0.02   $ 0.02   $ (0.02 )   -100 % 100 %
                               
    U.S. Appraisal segment                          
    Revenue $ 29.4   $ 33.8   $ 37.5   $ 32.6   $ 26.8     -13 % 9 %
    Net Revenue(A) $ 7.8   $ 9.0   $ 10.3   $ 9.2   $ 7.5     -14 % 4 %
    Net Revenue(A) margin   26.5 %   26.7 %   27.6 %   28.3 %   27.9 %      
    Adjusted EBITDA(A) $ 2.4   $ 4.1   $ 5.5   $ 4.4   $ 2.7     -41 % -10 %
    Adjusted EBITDA(A) margin   30.9 %   45.2 %   53.2 %   47.9 %   35.8 %      
                               
    U.S. Title segment                          
    Revenue $ 2.5   $ 2.4   $ 2.1   $ 2.0   $ 2.0     4 % 25 %
    Net Revenue(A) $ 1.4     1.2   $ 0.9     0.9   $ 1.0     12 % 41 %
    Net Revenue(A) margin   53.4 %   49.8 %   43.6 %   44.0 %   47.3 %      
    Adjusted EBITDA(A) $ (1.8 ) $ (1.6 ) $ (1.9 ) $ (1.7 ) $ (1.6 )   -13 % -11 %
    Adjusted EBITDA(A) margin   -132.3 %   -131.4 %   -209.8 %   -184.8 %   -167.9 %      
                               
    Canadian segment                          
    Revenue $ 9.1   $ 9.4   $ 9.9   $ 7.6   $ 6.6     -3 % 38 %
    Net Revenue(A) $ 1.7   $ 1.8   $ 1.9   $ 1.4   $ 1.2     -3 % 39 %
    Net Revenue(A) margin   18.9 %   18.9 %   19.0 %   18.9 %   18.8 %      
    Adjusted EBITDA(A) $ 1.1   $ 1.2   $ 1.3   $ 0.9   $ 0.7     -5 % 62 %
    Adjusted EBITDA(A) margin   66.1 %   67.7 %   69.3 %   62.3 %   56.8 %      
                               
    Corporate segment                          
    Adjusted EBITDA(A) $ (3.4 ) $ (3.1 ) $ (3.2 ) $ (2.9 ) $ (2.9 )   -8 % -20 %
    1. Percentage change is calculated based on figures disclosed in our MD&A which are rounded to the nearest thousands of dollars.

    Conference Call and Webcast
    A conference call to review the results will take place at 10:00 a.m. (ET) on Thursday, January 30, 2025, hosted by Chief Executive Officer Brian Lang and Chief Financial Officer Rodrigo Pinto. An accompanying slide presentation will be posted to the Investor section of our website shortly before the call.

    To access the call:

    • Participant Local (Toronto): (289) 819-1520
    • Participant Toll Free Dial-In Number: 1-800-549-8228
    • Conference ID: 15714

    To listen to the live webcast of the call:

    The webcast will be archived and a transcript of the call will be available in the Investor section of our website following the call.

    (A)   Non-GAAP Measures
    The non-GAAP measures used in this news release, including Net Revenue, Adjusted EBITDA and Adjusted Net Income do not have a standardized meaning prescribed by IFRS® Accounting Standards and are therefore unlikely to be comparable to similar measures presented by other issuers. These non-GAAP measures are more fully defined and discussed in the Company’s MD&A for the three months ended December 31, 2024 under the heading “Non-GAAP measures”, which is incorporated by reference in this Press Release and available on SEDAR+ at www.sedarplus.ca.

    Real Matters financial results for the three months ended December 31, 2024 are included in the unaudited interim condensed consolidated financial statements and the accompanying MD&A, each of which are available on SEDAR+ at www.sedarplus.ca. In addition, supplemental information is available on our website at www.realmatters.com.

    Net Revenue represents the difference between revenues and transaction costs. Net Revenue margin is calculated as Net Revenue divided by Revenues. The reconciling items between net income or loss and Net Revenue were as follows:

                Quarter ended
        Q1 2025     Q4 2024     Q3 2024     Q2 2024     Q1 2024
                         
    Net income (loss) $ 2.3   $ (0.2 ) $ 1.7   $ 2.1   $ (3.6)
    Operating expenses   12.7     12.6     11.8     11.2     11.6
    Amortization   0.7     0.8     0.8     0.8     0.8
    Restructuring expenses   0.4     –     –     –     –
    Interest expense   0.1     0.1     0.1     0.1     0.1
    Interest income   (0.5 )   (0.5 )   (0.5 )   (0.4 )   (0.4)
    Net foreign exchange (gain) loss   (6.1 )   1.3     (0.9 )   (2.2 )   2.0
    Loss (gain) on fair value of derivatives   1.7     (1.9 )   (0.1 )   0.1     (0.2)
    Income tax (recovery) expense   (0.4 )   (0.2 )   0.2     (0.2 )   (0.6)
    Net Revenue $ 10.9   $ 12.0   $ 13.1   $ 11.5   $ 9.7

    Adjusted EBITDA represents net income or loss before stock-based compensation expense, amortization, restructuring expenses, interest expense, interest income, net foreign exchange gain or loss, gain or loss on fair value of derivatives and income tax expense or recovery. Adjusted EBITDA margin is calculated as Adjusted EBITDA divided by Net Revenue. The reconciling items between net income or loss and Adjusted EBITDA were as follows:

                Quarter ended
        Q1 2025     Q4 2024     Q3 2024     Q2 2024     Q1 2024
                         
    Net income (loss) $ 2.3   $ (0.2 ) $ 1.7   $ 2.1   $ (3.6)
    Stock-based compensation expense   0.1     1.2     0.4     0.4     0.8
    Amortization   0.7     0.8     0.8     0.8     0.8
    Restructuring expenses   0.4     –     –     –     –
    Interest expense   0.1     0.1     0.1     0.1     0.1
    Interest income   (0.5 )   (0.5 )   (0.5 )   (0.4 )   (0.4)
    Net foreign exchange (gain) loss   (6.1 )   1.3     (0.9 )   (2.2 )   2.0
    Loss (gain) on fair value of derivatives   1.7     (1.9 )   (0.1 )   0.1     (0.2)
    Income tax (recovery) expense   (0.4 )   (0.2 )   0.2     (0.2 )   (0.6)
    Adjusted EBITDA $ (1.7 ) $ 0.6   $ 1.7   $ 0.7   $ (1.1)

    The reconciling items between net income or loss and Adjusted Net Income or Loss were as follows:

                Quarter ended
        Q1 2025     Q4 2024     Q3 2024     Q2 2024     Q1 2024
                         
    Net income (loss) $ 2.3   $ (0.2 ) $ 1.7   $ 2.1   $ (3.6)
    Stock-based compensation expense   0.1     1.2     0.4     0.4     0.8
    Amortization of intangibles   0.4     0.5     0.4     0.4     0.4
    Restructuring expenses   0.4     –     –     –     –
    Net foreign exchange (gain) loss   (6.1 )   1.3     (0.9 )   (2.2 )   2.0
    Loss (gain) on fair value of derivatives   1.7     (1.9 )   (0.1 )   0.1     (0.2)
    Related tax effects   0.9     –     0.2     0.5     (0.6)
    Adjusted Net (Loss) Income $ (0.3 ) $ 0.9   $ 1.7   $ 1.3   $ (1.2)

    Forward-Looking Information
    This Press Release contains “forward-looking information” within the meaning of applicable Canadian securities laws. Words such as “could”, “forecast”, “target”, “may”, “will”, “would”, “expect”, “anticipate”, “estimate”, “intend”, “plan”, “seek”, “believe”, “likely” and “predict” and variations of such words and similar expressions are intended to identify such forward-looking information, although not all forward-looking information contains these identifying words.

    The forward-looking information in this Press Release includes statements which reflect the current expectations of management with respect to our business and the industry in which we operate and is based on management’s experience and perception of historical trends, current conditions and expected future developments, as well as other factors that management believes appropriate and reasonable in the circumstances. The forward-looking information reflects management’s beliefs based on information currently available to management, including information obtained from third party sources, and should not be read as a guarantee of the occurrence or timing of any future events, performance or results.

    The forward-looking information in this Press Release is subject to risks, uncertainties and other factors that are difficult to predict and that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information. A comprehensive discussion of the factors which could cause results or events to differ from current expectations can be found in the “Risk Factors” section of our Annual Information Form for the year ended September 30, 2024, which is available on SEDAR+ at www.sedarplus.ca.

    Readers are cautioned not to place undue reliance on the forward-looking information, which reflect our expectations only as of the date of this Press Release. Except as required by law, we do not undertake to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

    About Real Matters
    Real Matters is a leading network management services provider for the mortgage lending and insurance industries. Real Matters’ platform combines its proprietary technology and network management capabilities with tens of thousands of independent qualified field professionals to create an efficient marketplace for the provision of mortgage lending and insurance industry services. Our clients include top 100 mortgage lenders in the U.S. and some of the largest banks and insurance companies in Canada. We are a leading independent provider of residential real estate appraisals to the mortgage market and a leading independent provider of title services in the U.S. Headquartered in Markham (ON), Real Matters has principal offices in Buffalo (NY) and Middletown (RI). Real Matters is listed on the Toronto Stock Exchange under the symbol REAL. For more information, visit www.realmatters.com.

    For more information:
    Lyne Beauregard
    Vice President, Investor Relations and Corporate Communications
    Real Matters
    lbeauregard@realmatters.com
    416.994.5930

    The MIL Network –

  • MIL-OSI: FirstCash Reports Record Fourth Quarter and Full-Year Operating Results; Accelerating Pawn Demand Drives Record Revenue & Earnings; Declares Quarterly Cash Dividend

    Source: GlobeNewswire (MIL-OSI)

    FORT WORTH, Texas, Jan. 30, 2025 (GLOBE NEWSWIRE) — FirstCash Holdings, Inc. (“FirstCash” or the “Company”) (Nasdaq: FCFS), the leading international operator of more than 3,000 retail pawn stores and a leading provider of retail point-of-sale (“POS”) payment solutions, today announced operating results for the fourth quarter and full-year ended December 31, 2024. The Company also announced that the Board of Directors declared a quarterly cash dividend of $0.38 per share, which will be paid on February 28, 2025.

    Mr. Rick Wessel, chief executive officer, stated, “FirstCash posted record fourth quarter and full year revenues and earnings primarily fueled by exceptionally strong pawn operating results. Same-store pawn receivables increased 12% in both the U.S. and Latin America (local currency basis) compared to last year. This marked the sixth consecutive quarter of double digit same-store pawn receivable growth in the U.S. The POS payment solutions segment (“AFF”) had solid profitability as well, and posted growth in transaction volumes and door counts for the quarter and year-to-date periods.

    “A total of 16 pawn stores were added in the fourth quarter, including an acquisition of 10 stores coupled with six new store openings. For the full year, 99 pawn stores were opened or acquired, boosting the total store base to 3,026 locations. FirstCash’s cash flows and balance sheet remain strong and we believe that we are well positioned to fund further anticipated store growth in 2025 along with dividends and potential share buybacks.”

    This release contains adjusted financial measures, which exclude certain non-operating and/or non-cash income and expenses, that are non-GAAP financial measures. Please refer to the descriptions and reconciliations to GAAP of these and other non-GAAP financial measures at the end of this release.

        Three Months Ended December 31,
        As Reported (GAAP)   Adjusted (Non-GAAP)
    In thousands, except per share amounts   2024   2023   2024   2023
    Revenue   $               883,811   $ 852,134   $               883,811   $ 852,134
    Net income   $                 83,547   $ 69,589   $                 95,415   $ 92,846
    Diluted earnings per share   $                     1.86   $ 1.53   $                     2.12   $ 2.04
    EBITDA (non-GAAP measure)   $               162,636   $ 145,493   $               165,685   $ 161,704
    Weighted-average diluted shares                       45,038     45,425                       45,038     45,425
     
        Twelve Months Ended December 31,
        As Reported (GAAP)   Adjusted (Non-GAAP)
    In thousands, except per share amounts   2024   2023   2024   2023
    Revenue   $           3,388,514   $ 3,151,796   $           3,388,514   $ 3,151,796
    Net income   $               258,815   $ 219,301   $               302,680   $ 276,874
    Diluted earnings per share   $                     5.73   $ 4.80   $                     6.70   $ 6.06
    EBITDA (non-GAAP measure)   $               551,008   $ 493,784   $               558,437   $ 511,732
    Weighted-average diluted shares                       45,168     45,693                       45,168     45,693
     

    Consolidated Operating Highlights

    • Gross revenues totaled a record $3.4 billion in 2024, an increase of 8% on both a GAAP and constant currency basis compared to last year. Revenues totaled $884 million in the fourth quarter, an increase of 4% on a GAAP basis and 7% on a constant currency basis compared to the prior-year quarter.
    • Diluted earnings per share for 2024 increased 19% over last year on a GAAP basis while adjusted diluted earnings per share increased 11% compared to the prior year. For the fourth quarter, diluted earnings per share increased 22% over the prior-year quarter on a GAAP basis while adjusted diluted earnings per share increased 4% compared to the prior-year quarter. These results were even more impressive in light of lower foreign currency exchange rates, which reduced 2024 earnings per share by approximately $0.06 for the fourth quarter and $0.04 for the full year compared to the prior-year periods.
    • Record net income for 2024 totaled $259 million on a GAAP basis while adjusted net income was a record $303 million, which represented increases of 18% and 9%, respectively, over the prior year.
    • Adjusted EBITDA for the full year was $558 million, an increase of $47 million, or 9%, compared to the prior year.

    Store Base and Platform Growth

    • Pawn Stores – 16 pawn locations were added in Mexico during the fourth quarter, consisting of ten acquired stores and six de novo stores. For the full year, a total of 99 pawn locations were added, including 29 stores in the U.S. and 70 stores in Latin America.

      As of December 31, 2024, the Company had 3,026 locations, comprised of 1,200 U.S. locations and 1,826 locations in Latin America.

    • Retail POS Payment Solutions (AFF) Merchant Partnerships – As of December 31, 2024, there were approximately 13,600 active retail and e-commerce merchant partner locations, representing a 17% increase in the number of active merchant locations compared to a year ago. Excluding certain furniture locations closed due to bankruptcies, the number of active doors increased over 25%.

    U.S. Pawn Segment Operating Results

    • Fourth quarter 2024 segment pre-tax operating income was $112 million, an increase of $13 million, or 14%, compared to the prior-year quarter. The resulting segment pre-tax operating margin remained strong at 26% for the quarter.
    • Full year 2024 segment pre-tax operating income was $397 million, an increase of $61 million, or 18%, compared to the prior year. The resulting segment pre-tax operating margin was 25% for the full year, which equaled the prior year.
    • Pawn receivables grew significantly over the course of the fourth quarter, totaling almost $400 million by year end and increasing 15% compared to the prior year. The increase in total pawn receivables was driven by a 5% increase in the year-to-date weighted-average store count coupled with an impressive 12% same-store increase. On a two-year stacked basis, same-store pawn receivables were up 26%.
    • Pawn loan fees increased 11% for the fourth quarter and 16% for the full year, while on a same-store basis, pawn loan fee revenue increased 9% and 11% compared to both of the respective prior-year periods.
    • Retail merchandise sales increased 10% in the fourth quarter and 13% for the full year compared to the respective prior-year periods. Same-store retail sales increased 6% for both the quarter and full year compared to the respective prior-year periods, as the Company saw continued retail demand from value-conscious consumers.
    • Retail sales margins improved to a robust 43% in the fourth quarter compared to 42% in the prior-year quarter. Full year retail margins were 42% in 2024 compared to 43% in 2023.
    • Annualized inventory turnover was consistent at 2.8 times for both 2024 and 2023. Inventories aged greater than one year at December 31, 2024 remained extremely low at 1% of total inventories.
    • Operating expenses for the fourth quarter and full year increased 10% and 12%, respectively, as compared to the prior-year periods, primarily due to store additions and increased labor and variable compensation expenses. On a same-store basis, expenses increased 7% for the quarter and 5% for the full year compared to the respective prior-year periods. 

    Latin America Pawn Segment Operating Results

    Note: Certain growth rates below are calculated on a constant currency basis, a non-GAAP financial measure defined at the end of this release. The average Mexican peso to U.S. dollar exchange rate for the fourth quarter of 2024 was 20.1 pesos / dollar, an unfavorable change of 14% versus the comparable prior-year period, and for the twelve-month period ended December 31, 2024 was 18.3 pesos / dollar, an unfavorable change of 3% versus the prior-year period.

    • While fourth quarter segment pre-tax operating income decreased 4% on a U.S. dollar basis compared to last year, it increased 7% on a constant currency basis. The resulting segment pre-tax operating margin was 20% for both the fourth quarter of 2024 and 2023.
    • For the full year of 2024, segment pre-tax operating income decreased 4% on a U.S. dollar basis compared to the prior year and decreased 2% on a constant currency basis. The resulting segment pre-tax operating margin was 19%, equaling the prior year.
    • While pawn receivables at December 31, 2024 decreased 5% on a U.S. dollar basis, they increased 13% on a constant currency basis compared to the prior year. On a same-store basis, pawn receivables decreased 6% on a U.S. dollar basis but increased 12% on a constant currency basis compared to the prior year.
    • While total and same-store pawn loan fees in the fourth quarter decreased 3% in U.S. dollars, they increased 10% on a constant currency basis compared to the prior-year quarter. For the full year, both total and same-store pawn loan fees increased 4%, or 7% on a constant currency basis, compared to the prior year.
    • Although retail merchandise sales in the fourth quarter of 2024 decreased 5% compared to the prior-year quarter, they increased 7% on a constant currency basis. Same-store retail merchandise sales in the fourth quarter of 2024 decreased 6% on a U.S. dollar basis while increasing 7% on a constant currency basis compared to the prior-year quarter. For the full year, retail merchandise sales increased 2%, or 4% on a constant currency basis, compared to the prior year, while same-store retail merchandise sales increased 1%, or 4% on a constant currency basis, compared to the prior year.
    • Retail margins were 34% for the fourth quarter of 2024 and 35% for the full year, both similar to prior-period results. Annualized inventory turnover was 4.2 times in 2024 versus 4.4 times in 2023, while inventories aged greater than one year at December 31, 2024 remained extremely low at 1%.
    • Operating expenses for the fourth quarter of 2024 decreased 5% in total but increased 7% on a constant currency basis compared to the prior-year quarter while full year operating expenses increased 7%, or 9% on a constant currency basis compared to last year. The increase in constant currency expenses from all stores reflected increased store counts and higher labor costs (due primarily to further increases in the federal minimum wage and other mandated benefit programs), along with other inflationary impacts.

    American First Finance (AFF) – Retail POS Payment Solutions Segment Operating Results

    • Fourth quarter segment pre-tax operating income totaled $39 million, a decrease of 10% compared to the prior-year quarter. The anticipated decline in earnings was reflective of lower net revenue from its furniture vertical, partially offset by strong growth in non-furniture net revenues.
    • For the full year, segment pre-tax operating income remained strong at $129 million, a nominal decrease of 3% over the prior year.
    • Segment revenues for the quarter, comprised of lease-to-own (“LTO”) fees and interest and fees on finance receivables, decreased 1% compared to the prior-year quarter. Revenues for the full year increased 3% compared to the prior year.
    • Gross transaction volume of lease and loan originations during the fourth quarter increased $12 million, or 4%, compared to last year, driven primarily by the 17% increase in active merchant door counts and continued growth in non-furniture verticals. Excluding furniture, fourth quarter origination volume increased approximately 36%. For the full year, overall gross transaction volume increased 5% over the prior year and was up 27%, excluding furniture.
    • Combined gross leased merchandise and finance receivables outstanding at December 31, 2024 decreased 1% compared to the December 31, 2023 balances.
    • The combined lease and loan loss provision as a percentage of the total gross transaction volume originated was 29% for both 2024 and 2023. The resulting allowance on combined leased merchandise and finance receivables at December 31, 2024 was 42% compared to 40% in the prior year.
    • The average monthly net charge-off (“NCO”) rate for combined leased merchandise and finance receivable products for the full year 2024 was 5.3% compared to the prior-year rate of 5.0%, and was in line with the Company’s targeted range for NCO’s.

    Cash Flow and Liquidity

    • Each of the Company’s three business segments generated significant operating cash flows in 2024. Consolidated operating cash flows for the full year grew 30% and totaled $540 million compared to $416 million in 2023.
    • Adjusted free cash flows (a non-GAAP measure) increased 24% to $262 million in 2024, compared to $212 million in the prior year.
    • The operating cash flows helped fund significant growth in earning assets and continued investments in the pawn store platform with a nominal increase in net debt.  Key investments made in 2024 included:
      • Pawn earning assets (pawn receivables and inventories) increased $69 million.
      • A total of 38 pawn stores were acquired for a combined cash purchase price of $76 million. 
      • 61 new, or de novo, pawn stores were added for a total investment of $19 million in fixed assets and working capital.
      • Real estate purchases totaling $86 million as the Company purchased the underlying real estate at 58 of its existing pawn stores, bringing the number of Company-owned properties to 400 locations.
    • Net debt at December 31, 2024 was $1.6 billion, a modest 5% increase over the prior year. Over $1.5 billion of the Company’s long-term financing remains fixed rate debt with favorable interest rates ranging from 4.625% to 6.875% and maturity dates that do not begin until 2028 and continue into 2032.
    • The Company’s net debt to adjusted EBITDA ratio was 2.8x at December 31, 2024.

    Shareholder Returns

    • The Board of Directors declared a $0.38 per share first quarter cash dividend, which will be paid on February 28, 2025 to stockholders of record as of February 14, 2025. This represents an annualized dividend of $1.52 per share. Any future dividends are subject to approval by the Company’s Board of Directors.
    • During 2024, FirstCash repurchased $85 million of its common stock. The Company has $115 million available under the $200 million share repurchase program authorized in July 2023. Future share repurchases are subject to expected liquidity, acquisitions and other investment opportunities, debt covenant restrictions, market conditions and other relevant factors.
    • Combined shareholder payouts in the form of cash dividends and stock repurchases were over $150 million in 2024 and have totaled almost $800 million over the last five years.
    • The Company generated a 13% return on equity and a 6% return on assets in 2024. Using adjusted net income for 2024, the adjusted return on equity was 15% while the adjusted return on assets was 7%.

    2025 Outlook

    The Company’s outlook for 2025 is highly positive given the continued growth in pawn receivables and expectations for further pawn store additions and AFF merchant partner growth. Anticipated conditions and trends for 2025 include the following:

    Pawn Operations:

    • Pawn operations will continue to be the primary earnings driver, as the Company expects the contribution from the combined U.S. and Latin America pawn segments to be approximately 85% of total segment level pre-tax income for 2025.
    • The Company expects further growth in the pawn store base in 2025 through a combination of new store openings and potential acquisitions. Over the last five years, the Company has added an average of 115 new and acquired stores per year. The guidance presented below does not assume any material acquisition activity.

    U.S. Pawn

    • U.S. Pawn is anticipated to contribute approximately 65% of total segment level pre-tax income for 2025.
    • Same-store pawn loans began 2025 up 12% compared to a year ago, with January balances to date up similarly. Given the strength of the 2024 same-store results, growth rates are expected to moderate slightly over the course of the year, but still result in strong pawn fee growth that is expected to be in a range of 8% to 11% for the full year. 
    • Similar retail sales growth is projected for 2025, with retail margins expected to be in a normalized range targeted at approximately 42%.
    • Given the strong revenue momentum coupled with modest expense growth, the Company anticipates solid double-digit segment earnings growth in 2025 from this, its largest segment.

    Latin America Pawn

    • LatAm Pawn is anticipated to contribute approximately 20% of total segment level pre-tax income for 2025.
    • U.S. dollar-reported results for Latin America in 2025 are expected to be impacted by the lower exchange rate for the Mexican peso, which has most recently been in a range 20 to 21 pesos per U.S. dollar compared to the average exchange rate of 18.3 to 1 in 2024.
    • Same-store pawn receivables began 2025 down 6% on a U.S. dollar basis but up 12% on a constant currency basis. Full year pawn fee growth is expected to remain in a range of 8% to 11% on a local currency basis while it is projected to be down in a range of 2% to 5% on a U.S. dollar basis, given the current exchange rate.
    • Retail sales in Latin America are also expected to track similarly to pawn fees in 2025 with consistent retail margins.
    • While operating expenses are expected to increase by 6% to 9% in Latin America on a local currency basis (given the enacted 10% increase in the Mexico minimum wage for 2025), expenses are anticipated to decline in a range of 3% to 6% on a U.S. dollar basis, which should dampen the overall currency impact on dollar-denominated segment earnings.

    Retail POS Payment Solutions (AFF) Operations:

    • AFF is anticipated to contribute approximately 15% of total segment level pre-tax income for 2025.
    • As a result of recent merchant partner bankruptcies in the furniture sector (Conn’s HomePlus and American Freight), the Company anticipates first half 2025 origination volume being down to the prior year, given lower expected furniture originations, which are more seasonally weighted to the income tax refund season. Despite this headwind, full year origination volume for 2025 is expected to increase in a low single digit range compared to 2024, given continued growth in door counts and originations from new and other existing merchants. Excluding originations from Conn’s HomePlus and American Freight, origination volumes are expected to increase in a range of 20% to 25% over 2024.
    • While full year 2025 net revenues are forecast to decline in a range of 10% to 15% compared to the prior year due to lower LTO balances and first half originations, reduced operating expenses related to the changes in product mix and other expense reduction initiatives are expected to offset much of the decrease in net revenue. Resulting full year segment pre-tax income is expected to be flat to down only slightly compared to the prior year.

    Tax Rates and Currency:

    • The full year 2025 effective income tax rate under current tax codes in the U.S. and Latin America is expected to range from 24% to 25%.
    • Each full point change in the exchange rate of the Mexican peso is projected to have an annual earnings impact of approximately $0.10 per share.

    Additional Commentary and Analysis

    Mr. Wessel further commented on FirstCash’s 2024 operating results and the outlook for 2025, “Our core pawn segments continue to see exceptional growth in pawn receivables, pawn fees and retail sales. Strong sequential acceleration in same-store pawn receivable growth rates during the fourth quarter resulted in end of year increases in pawn receivables of 15% in the U.S. and 13% (constant currency basis) in Latin America compared to last year. We believe this growth continues to be driven by inflationary impacts and credit tightening for consumers with small, immediate cash needs. Furthermore, we saw excellent retail sales results in the fourth quarter, with same-store sales up 6% in the U.S. and 7% in LatAm (constant currency) compared to the prior-year quarter while maintaining strong gross margins, which we attribute to our deep value retail pricing, attractive interest-free layaway programs and excellent customer service.

    “Our industry-leading pawn operations were further expanded in 2024 as we added almost 100 locations through new store openings across all markets, coupled with strategic acquisitions in the U.S. and Mexico. Over the last five years, we have opened or acquired more than 550 pawn locations and we began 2025 with a strong pipeline of new store openings already in process. While most of our new store openings will continue to be in Latin America, we currently have three store openings slated for growth markets in the U.S. Additionally, we continue to see accretive acquisition opportunities in multiple markets which can be funded from available cash and credit facilities.

    “While a smaller component of FirstCash’s consolidated operations, AFF posted solid results in 2024 by contributing almost $130 million in segment earnings and generating meaningful cash flow. Although this was a difficult year in the retail furniture industry, given weak sales volumes and store closings at several retailers of size, AFF posted overall origination growth in 2024, driven by successful expansion in other vertical categories and its strong field sales channel.

    “We began 2025 in a strong position to again deliver meaningful earnings growth with the current momentum in our core pawn business in both the U.S. and Latin America and opportunities for additional growth through pawnshop acquisitions and de novo store openings. AFF’s prospects remain positive as well, as it continues to grow and diversify its merchant base. On a consolidated basis, our strong cash flows and balance sheet position us well to support this growth, and combined with ongoing cash dividends and potential share repurchases, are expected to drive further shareholder returns,” concluded Mr. Wessel.

    About FirstCash

    FirstCash is the leading international operator of pawn stores focused on serving cash and credit-constrained consumers. FirstCash’s more than 3,000 pawn stores in the U.S. and Latin America buy and sell a wide variety of jewelry, electronics, tools, appliances, sporting goods, musical instruments and other merchandise, and make small non-recourse pawn loans secured by pledged personal property. FirstCash’s pawn segments in the U.S. and Latin America currently account for approximately 80% of segment earnings, with the remainder provided by its wholly owned subsidiary, AFF, which provides lease-to-own and retail finance payment solutions for consumer goods and services.

    FirstCash is a component company in both the Standard & Poor’s MidCap 400 Index® and the Russell 2000 Index®. FirstCash’s common stock (ticker symbol “FCFS”) is traded on the Nasdaq, the creator of the world’s first electronic stock market. For additional information regarding FirstCash and the services it provides, visit FirstCash’s websites located at http://www.firstcash.com and http://www.americanfirstfinance.com.

    Forward-Looking Information     

    This release contains forward-looking statements about the business, financial condition, outlook and prospects of FirstCash Holdings, Inc. and its wholly owned subsidiaries (together, the “Company”), including the Company’s outlook for 2025. Forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995, can be identified by the use of forward-looking terminology such as “outlook,” “believes,” “projects,” “expects,” “may,” “estimates,” “should,” “plans,” “targets,” “intends,” “could,” “would,” “anticipates,” “potential,” “confident,” “optimistic,” or the negative thereof, or other variations thereon, or comparable terminology, or by discussions of strategy, objectives, estimates, guidance, expectations, outlook and future plans. Forward-looking statements can also be identified by the fact that these statements do not relate strictly to historical or current matters. Rather, forward-looking statements relate to anticipated or expected events, activities, trends or results. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties.

    While the Company believes the expectations reflected in forward-looking statements are reasonable, there can be no assurances such expectations will prove to be accurate. Security holders are cautioned that such forward-looking statements involve risks and uncertainties. Certain factors may cause results to differ materially from those anticipated by the forward-looking statements made in this release. Such factors and risks may include, without limitation, risks related to the extensive regulatory environment in which the Company operates; risks associated with the legal and regulatory proceedings that the Company is a party to or may become a party to in the future, including the Consumer Financial Protection Bureau (the “CFPB”) lawsuit filed against the Company; risks related to the Company’s acquisitions, including the failure of the Company’s acquisitions to deliver the estimated value and benefits expected by the Company and the ability of the Company to continue to identify and consummate acquisitions on favorable terms, if at all; potential changes in consumer behavior and shopping patterns which could impact demand for the Company’s pawn loan, retail, lease-to-own (“LTO”) and retail finance products, labor shortages and increased labor costs; a deterioration in the economic conditions in the United States and Latin America, including as a result of inflation, elevated interest rates and higher gas prices, which potentially could have an impact on discretionary consumer spending and demand for the Company’s products; currency fluctuations, primarily involving the Mexican peso; competition the Company faces from other retailers and providers of retail payment solutions; the ability of the Company to successfully execute on its business strategies; contraction in sales activity at merchant partners of the Company’s retail POS payment solutions business; impact of store closures, financial difficulties or even bankruptcies at the merchant partners of the Company’s retail POS payment solutions business; the ability of the Company’s retail POS payment solutions business to continue to grow its base of merchant partners, including those outside of the furniture vertical; and other risks discussed and described in the Company’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”), including the risks described in Part 1, Item 1A, “Risk Factors” thereof, and other reports filed with the SEC. Many of these risks and uncertainties are beyond the ability of the Company to control, nor can the Company predict, in many cases, all of the risks and uncertainties that could cause its actual results to differ materially from those indicated by the forward-looking statements. The forward-looking statements contained in this release speak only as of the date of this release, and the Company expressly disclaims any obligation or undertaking to report any updates or revisions to any such statement to reflect any change in the Company’s expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.

    FIRSTCASH HOLDINGS, INC.
    CONSOLIDATED STATEMENTS OF INCOME
    (unaudited, in thousands)
     
        Three Months Ended   Twelve Months Ended
        December 31,   December 31,
        2024   2023   2024   2023
    Revenue:                
    Retail merchandise sales   $      413,671     $ 397,412     $ 1,507,096     $ 1,381,272  
    Pawn loan fees            189,984       178,238              737,126       658,536  
    Leased merchandise income            177,440       190,057              766,241       752,682  
    Interest and fees on finance receivables              70,507       59,571              245,891       233,818  
    Wholesale scrap jewelry sales              32,209       26,856              132,160       125,488  
    Total revenue            883,811       852,134           3,388,514       3,151,796  
                     
    Cost of revenue:                
    Cost of retail merchandise sold            249,831       241,402              909,685       832,393  
    Depreciation of leased merchandise              97,937       103,631              433,306       411,455  
    Provision for lease losses              33,561       34,184              163,395       175,858  
    Provision for loan losses              41,736       32,459              143,827       123,030  
    Cost of wholesale scrap jewelry sold              27,058       22,809              108,769       101,821  
    Total cost of revenue            450,123       434,485           1,758,982       1,644,557  
                     
    Net revenue            433,688       417,649           1,629,532       1,507,239  
                     
    Expenses and other income:                
    Operating expenses            226,547       216,783              900,978       832,149  
    Administrative expenses              43,636       51,887              173,199       176,315  
    Depreciation and amortization              26,434       27,635              104,941       109,161  
    Interest expense              27,197       26,586              105,226       93,243  
    Interest income                  (528 )     (216 )              (1,935 )     (1,469 )
    Loss (gain) on foreign exchange                    508       376                  2,641       (1,529 )
    Merger and acquisition expenses                      42       4,252                  2,228       7,922  
    Other expenses (income), net                    319       (1,142 )                  (522 )     (1,402 )
    Total expenses and other income            324,155       326,161           1,286,756       1,214,390  
                     
    Income before income taxes            109,533       91,488              342,776       292,849  
                     
    Provision for income taxes              25,986       21,899                83,961       73,548  
                     
    Net income   $        83,547     $ 69,589     $      258,815     $ 219,301  
     
    FIRSTCASH HOLDINGS, INC.
    CONSOLIDATED BALANCE SHEETS
    (unaudited, in thousands)
     
        December 31,
        2024   2023
    ASSETS        
    Cash and cash equivalents   $            175,095     $ 127,018  
    Accounts receivable, net                     73,325       71,922  
    Pawn loans                   517,867       471,846  
    Finance receivables, net                   147,501       113,901  
    Inventories                   334,580       312,089  
    Leased merchandise, net                   128,437       171,191  
    Prepaid expenses and other current assets                     26,943       38,634  
    Total current assets               1,403,748       1,306,601  
             
    Property and equipment, net                   717,916       632,724  
    Operating lease right of use asset                   324,646       328,458  
    Goodwill               1,787,172       1,727,652  
    Intangible assets, net                   228,858       277,724  
    Other assets                       9,934       10,242  
    Deferred tax assets, net                       4,712       6,514  
    Total assets   $         4,476,986     $ 4,289,915  
             
    LIABILITIES AND STOCKHOLDERS’ EQUITY        
    Accounts payable and accrued liabilities   $            171,540     $ 163,050  
    Customer deposits and prepayments                     72,703       70,580  
    Lease liability, current                     95,161       101,962  
    Total current liabilities                   339,404       335,592  
             
    Revolving unsecured credit facilities                   198,000       568,000  
    Senior unsecured notes               1,531,346       1,037,647  
    Deferred tax liabilities, net                   128,574       136,773  
    Lease liability, non-current                   225,498       215,485  
    Total liabilities               2,422,822       2,293,497  
             
    Stockholders’ equity:        
    Common stock                          575       573  
    Additional paid-in capital               1,767,569       1,741,046  
    Retained earnings               1,411,083       1,218,029  
    Accumulated other comprehensive loss                 (129,596 )     (43,037 )
    Common stock held in treasury, at cost                 (995,467 )     (920,193 )
    Total stockholders’ equity               2,054,164       1,996,418  
    Total liabilities and stockholders’ equity   $         4,476,986     $ 4,289,915  
     
    FIRSTCASH HOLDINGS, INC.
    U.S. PAWN SEGMENT RESULTS
    (UNAUDITED)
     
    U.S. Pawn Operating Results and Margins (dollars in thousands)
     
        Three Months Ended        
        December 31,    
        2024   2023   Increase
    Revenue:                    
    Retail merchandise sales   $             267,251     $ 243,697       10 %  
    Pawn loan fees                 133,563       120,083       11 %  
    Wholesale scrap jewelry sales                   23,201       17,463       33 %  
    Total revenue                 424,015       381,243       11 %  
                         
    Cost of revenue:                    
    Cost of retail merchandise sold                 153,641       141,406       9 %  
    Cost of wholesale scrap jewelry sold                   19,755       14,941       32 %  
    Total cost of revenue                 173,396       156,347       11 %  
                         
    Net revenue                 250,619       224,896       11 %  
                         
    Segment expenses:                    
    Operating expenses                 131,439       119,627       10 %  
    Depreciation and amortization                     7,371       6,799       8 %  
    Total segment expenses                 138,810       126,426       10 %  
                         
    Segment pre-tax operating income   $             111,809     $ 98,470       14 %  
                         
    Operating metrics:                    
    Retail merchandise sales margin   43 %   42 %        
    Net revenue margin   59 %   59 %        
    Segment pre-tax operating margin   26 %   26 %        
     
    FIRSTCASH HOLDINGS, INC.
    U.S. PAWN SEGMENT RESULTS (CONTINUED)
    (UNAUDITED)
     
        Twelve Months Ended        
        December 31,    
        2024   2023   Increase
    Revenue:                    
    Retail merchandise sales   $             969,371     $ 854,190       13 %  
    Pawn loan fees                 505,262       435,762       16 %  
    Wholesale scrap jewelry sales                   93,923       78,571       20 %  
    Total revenue             1,568,556       1,368,523       15 %  
                         
    Cost of revenue:                    
    Cost of retail merchandise sold                 560,970       490,544       14 %  
    Cost of wholesale scrap jewelry sold                   77,683       64,545       20 %  
    Total cost of revenue                 638,653       555,089       15 %  
                         
    Net revenue                 929,903       813,434       14 %  
                         
    Segment expenses:                    
    Operating expenses                 503,630       451,543       12 %  
    Depreciation and amortization                   28,980       25,585       13 %  
    Total segment expenses                 532,610       477,128       12 %  
                         
    Segment pre-tax operating income   $             397,293     $ 336,306       18 %  
                         
    Operating metrics:                    
    Retail merchandise sales margin   42 %   43 %        
    Net revenue margin   59 %   59 %        
    Segment pre-tax operating margin   25 %   25 %        
     
    FIRSTCASH HOLDINGS, INC.
    U.S. PAWN SEGMENT RESULTS (CONTINUED)
    (UNAUDITED)
     
    U.S. Pawn Earning Assets and Portfolio Metrics (dollars in thousands, except as otherwise noted)
     
        As of December 31,    
        2024   2023   Increase
    Earning assets:                    
    Pawn loans   $      396,667     $ 344,152       15 %  
    Inventories          245,492       221,843       11 %  
        $      642,159     $ 565,995       13 %  
                         
    Average outstanding pawn loan amount (in ones)   $              283     $ 258       10 %  
                         
    Composition of pawn collateral:                    
    General merchandise   28 %   30 %        
    Jewelry   72 %   70 %        
        100 %   100 %        
                         
    Composition of inventories:                    
    General merchandise   41 %   43 %        
    Jewelry   59 %   57 %        
        100 %   100 %        
                         
    Percentage of inventory aged greater than one year   1 %   1 %        
                         
    Inventory turnover (trailing twelve months cost of merchandise sales divided by average inventories)   2.8 times   2.8 times        
     

    FIRSTCASH HOLDINGS, INC.
    LATIN AMERICA PAWN SEGMENT RESULTS
    (UNAUDITED)

    Latin America Pawn Segment Results

    Constant currency results are non-GAAP financial measures, which exclude the effects of foreign currency translation and are calculated by translating current-year results at prior-year average exchange rates. See the “Constant Currency Results” section below for additional discussion of constant currency operating results.

    Latin America Pawn Operating Results and Margins (dollars in thousands)

                            Constant Currency Basis
                            Three Months        
                      Ended        
        Three Months Ended           December 31,   Increase /
        December 31,       2024   (Decrease)
        2024   2023   (Decrease)   (Non-GAAP)   (Non-GAAP)
    Revenue:                                
    Retail merchandise sales   $        147,412     $ 155,310       (5) %   $            166,927       7 %  
    Pawn loan fees              56,421       58,155       (3) %                     63,893       10 %  
    Wholesale scrap jewelry sales                9,008       9,393       (4) %                       9,008       (4) %  
    Total revenue            212,841       222,858       (4) %                   239,828       8 %  
                                     
    Cost of revenue:                                
    Cost of retail merchandise sold              96,718       100,870       (4) %                   109,445       9 %  
    Cost of wholesale scrap jewelry sold                7,303       7,868       (7) %                       8,278       5 %  
    Total cost of revenue            104,021       108,738       (4) %                   117,723       8 %  
                                     
    Net revenue            108,820       114,120       (5) %                   122,105       7 %  
                                     
    Segment expenses:                                
    Operating expenses              60,918       63,976       (5) %                     68,628       7 %  
    Depreciation and amortization                5,170       5,466       (5) %                       5,754       5 %  
    Total segment expenses              66,088       69,442       (5) %                     74,382       7 %  
                                     
    Segment pre-tax operating income   $          42,732     $ 44,678       (4) %   $              47,723       7 %  
                                     
    Operating metrics:                                
    Retail merchandise sales margin   34 %   35 %         34 %        
    Net revenue margin   51 %   51 %         51 %        
    Segment pre-tax operating margin   20 %   20 %         20 %        
     
    FIRSTCASH HOLDINGS, INC.
    LATIN AMERICA PAWN SEGMENT RESULTS (CONTINUED)
    (UNAUDITED)
     
                          Constant Currency Basis
                    Twelve Months    
                    Ended    
        Twelve Months Ended         December 31,   Increase /
        December 31,   Increase / 2024   (Decrease)
        2024   2023   (Decrease) (Non-GAAP)   (Non-GAAP)
    Revenue:                              
    Retail merchandise sales   $        541,787     $ 533,612       2 %   $              556,686       4 %  
    Pawn loan fees            231,864       222,774       4 %                     238,305       7 %  
    Wholesale scrap jewelry sales              38,237       46,917       (19) %                       38,237       (19) %  
    Total revenue            811,888       803,303       1 %                     833,228       4 %  
                                   
    Cost of revenue:                              
    Cost of retail merchandise sold            350,906       345,309       2 %                     360,452       4 %  
    Cost of wholesale scrap jewelry sold              31,086       37,276       (17) %                       31,977       (14) %  
    Total cost of revenue            381,992       382,585       — %                     392,429       3 %  
                                   
    Net revenue            429,896       420,718       2 %                     440,799       5 %  
                                   
    Segment expenses:                              
    Operating expenses            259,307       243,146       7 %                     266,102       9 %  
    Depreciation and amortization              20,369       21,350       (5) %                       20,855       (2) %  
    Total segment expenses            279,676       264,496       6 %                     286,957       8 %  
                                   
    Segment pre-tax operating income   $        150,220     $ 156,222       (4) %   $              153,842       (2) %  
                                   
    Operating metrics:                              
    Retail merchandise sales margin   35 %   35 %         35 %        
    Net revenue margin   53 %   52 %         53 %        
    Segment pre-tax operating margin   19 %   19 %         18 %        
     
    FIRSTCASH HOLDINGS, INC.
    LATIN AMERICA PAWN SEGMENT RESULTS (CONTINUED)
    (UNAUDITED)
     
    Latin America Pawn Earning Assets and Portfolio Metrics (dollars in thousands, except as otherwise noted)
     
                            Constant Currency Basis
                            As of        
                            December 31,    
        As of December 31,       2024   Increase
        2024   2023   (Decrease)   (Non-GAAP)   (Non-GAAP)
    Earning assets:                                
    Pawn loans   $       121,200     $ 127,694       (5) %   $           143,805     13 %  
    Inventories             89,088       90,246       (1) %                 105,686     17 %  
        $       210,288     $ 217,940       (4) %   $           249,491     14 %  
                                     
    Average outstanding pawn loan amount  (in ones)   $                 87     $ 95       (8) %   $                   103     8 %  
                                     
    Composition of pawn collateral:                                
    General merchandise   58 %   63 %                    
    Jewelry   42 %   37 %                    
        100 %   100 %                    
                                     
    Composition of inventories:                                
    General merchandise   65 %   67 %                    
    Jewelry   35 %   33 %                    
        100 %   100 %                    
                                     
    Percentage of inventory aged greater than one year   1 %   1 %                    
                                     
    Inventory turnover (trailing twelve months cost of merchandise sales divided by average inventories)   4.2 times   4.4 times                    
     
    FIRSTCASH HOLDINGS, INC.
    RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS
    (UNAUDITED)
     
    Retail POS Payment Solutions Operating Results (dollars in thousands)
     
        Three Months Ended        
        December 31,   Increase /
        2024   2023   (Decrease)
    Revenue:                
    Leased merchandise income   $               177,440   $ 190,057     (7) %  
    Interest and fees on finance receivables                       70,507     59,571     18 %  
    Total revenue                     247,947     249,628     (1) %  
                     
    Cost of revenue:                
    Depreciation of leased merchandise                       98,266     104,114     (6) %  
    Provision for lease losses                       33,665     35,564     (5) %  
    Provision for loan losses                       41,736     32,459     29 %  
    Total cost of revenue                     173,667     172,137     1 %  
                     
    Net revenue                       74,280     77,491     (4) %  
                     
    Segment expenses:                
    Operating expenses                       34,190     33,180     3 %  
    Depreciation and amortization                             705     772     (9) %  
    Total segment expenses                       34,895     33,952     3 %  
                     
    Segment pre-tax operating income   $                 39,385   $ 43,539     (10) %  
     
    FIRSTCASH HOLDINGS, INC.
    RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS (CONTINUED)
    (UNAUDITED)
     
        Twelve Months Ended        
        December 31,   Increase /
        2024   2023   (Decrease)
    Revenue:                
    Leased merchandise income   $               766,241   $ 752,682     2 %  
    Interest and fees on finance receivables                     245,891     233,818     5 %  
    Total revenue                  1,012,132     986,500     3 %  
                     
    Cost of revenue:                
    Depreciation of leased merchandise                     434,915     413,546     5 %  
    Provision for lease losses                     163,937     177,418     (8) %  
    Provision for loan losses                     143,827     123,030     17 %  
    Total cost of revenue                     742,679     713,994     4 %  
                     
    Net revenue                     269,453     272,506     (1) %  
                     
    Segment expenses:                
    Operating expenses                     138,041     137,460     — %  
    Depreciation and amortization                         2,783     3,030     (8) %  
    Total segment expenses                     140,824     140,490     — %  
                     
    Segment pre-tax operating income   $               128,629   $ 132,016     (3) %  
     
    FIRSTCASH HOLDINGS, INC.
    RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS (CONTINUED)
    (UNAUDITED)
     
    Retail POS Payment Solutions Gross Transaction Volumes (dollars in thousands)
     
        Three Months Ended      
        December 31, Increase /
        2024   2023   (Decrease)
    Leased merchandise   $          124,590   $ 170,278     (27) %  
    Finance receivables                 159,898     102,279     56 %  
    Total gross transaction volume   $          284,488   $ 272,557     4 %  
     
        Twelve Months Ended      
        December 31, Increase /
        2024   2023   (Decrease)
    Leased merchandise   $          568,635   $ 623,069     (9) %  
    Finance receivables                 510,231     405,765     26 %  
    Total gross transaction volume   $       1,078,866   $ 1,028,834     5 %  
     

    Retail POS Payment Solutions Earning Assets (dollars in thousands)

        As of December 31,   Increase /
        2024     2023     (Decrease)
    Leased merchandise, net:                
    Leased merchandise, before allowance for lease losses   $          209,333     $ 267,458       (22) %  
    Less allowance for lease losses                 (80,661 )     (95,752 )     (16) %  
    Leased merchandise, net   $          128,672     $ 171,706       (25) %  
                     
    Finance receivables, net:                
    Finance receivables, before allowance for loan losses   $          264,506     $ 210,355       26 %  
    Less allowance for loan losses               (117,005 )     (96,454 )     21 %  
    Finance receivables, net   $          147,501     $ 113,901       29 %  
     
    FIRSTCASH HOLDINGS, INC.
    RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS (CONTINUED)
    (UNAUDITED)
     
    Allowance for Lease and Loan Losses and Other Portfolio Metrics (dollars in thousands)
               
        Three Months Ended      
        December 31,   Increase /
        2024   2023   (Decrease)
    Allowance for lease losses:              
    Balance at beginning of period   $                 93,823     $ 105,472     (11) %  
    Provision for lease losses                       33,665       35,564     (5) %  
    Charge-offs                     (48,607 )     (46,986 )   3 %  
    Recoveries                         1,780       1,702     5 %  
    Balance at end of period   $                 80,661     $ 95,752     (16) %  
                   
    Leased merchandise portfolio metrics:              
    Provision rate (1)   27 %   21 %      
    Average monthly net charge-off rate (2)   7.1 %   5.8 %      
    Delinquency rate (3)   24.4 %   21.7 %      
                   
    Allowance for loan losses:              
    Balance at beginning of period   $               109,197     $ 96,684     13 %  
    Provision for loan losses                       41,736       32,459     29 %  
    Charge-offs                     (35,751 )     (34,680 )   3 %  
    Recoveries                         1,823       1,991     (8) %  
    Balance at end of period   $               117,005     $ 96,454     21 %  
                   
    Finance receivables portfolio metrics:              
    Provision rate (1)   26 %   32 %      
    Average monthly net charge-off rate (2)   4.5 %   5.2 %      
    Delinquency rate (3)   20.0 %   21.8 %      
                       
    (1)        Calculated as provision for lease or loan losses as a percentage of the respective gross transaction volume originated.         
                       
    (2)        Calculated as charge-offs, net of recoveries, as a percentage of the respective average earning asset balance before allowance for lease or loan losses.         
                       
    (3)        Calculated as the percentage of the respective contractual earning asset balance owed that is 1 to 89 days past due (the Company charges off leases and finance receivables when they are 90 days or more contractually past due).         
     
    FIRSTCASH HOLDINGS, INC.
    RETAIL POS PAYMENT SOLUTIONS SEGMENT RESULTS (CONTINUED)
    (UNAUDITED)
     
      Twelve Months Ended        
        December 31,       Increase /
        2024   2023   (Decrease)
    Allowance for lease losses:                
    Balance at beginning of period   $                 95,752     $ 79,576       20 %  
    Provision for lease losses                     163,937       177,418       (8) %  
    Charge-offs                   (186,123 )     (167,952 )     11 %  
    Recoveries                         7,095       6,710       6 %  
    Balance at end of period   $                 80,661     $ 95,752       (16) %  
                     
    Leased merchandise portfolio metrics:                
    Provision rate (1) 29 %   28 %        
    Average monthly net charge-off rate (2) 6.3 %   5.4 %        
    Delinquency rate (3) 24.4 %   21.7 %        
                     
    Allowance for loan losses:                
    Balance at beginning of period   $                 96,454     $ 84,833       14 %  
    Provision for loan losses                     143,827       123,030       17 %  
    Charge-offs                   (130,812 )     (117,961 )     11 %  
    Recoveries                         7,536       6,552       15 %  
    Balance at end of period   $               117,005     $ 96,454       21 %  
                     
    Finance receivables portfolio metrics:                
    Provision rate (1) 28 %   30 %        
    Average monthly net charge-off rate (2) 4.3 %   4.7 %        
    Delinquency rate (3) 20.0 %   21.8 %        
     
    (1)        Calculated as provision for lease or loan losses as a percentage of the respective gross transaction volume originated.
     
    (2)        Calculated as charge-offs, net of recoveries, as a percentage of the respective average earning asset balance before allowance for lease or loan losses.
     
    (3)        Calculated as the percentage of the respective contractual earning asset balance owed that is 1 to 89 days past due (the Company charges off leases and finance receivables when they are 90 days or more contractually past due).
     

    FIRSTCASH HOLDINGS, INC.
    PAWN STORE LOCATIONS AND MERCHANT PARTNER LOCATIONS

    Pawn Operations

    As of December 31, 2024, the Company operated 3,026 pawn store locations comprised of 1,200 stores in 29 U.S. states and the District of Columbia, 1,725 stores in 32 states in Mexico, 72 stores in Guatemala, 17 stores in El Salvador and 12 stores in Colombia.

    The following tables detail pawn store count activity for the three and twelve months ended December 31, 2024:

        Three Months Ended December 31, 2024
        U.S.   Latin America   Total
    Total locations, beginning of period   1,201     1,824     3,025  
    New locations opened   —     6     6  
    Locations acquired   —     10     10  
    Consolidation of existing pawn locations (1)   (1 )   (14 )   (15 )
    Total locations, end of period   1,200     1,826     3,026  
                 
                 
        Twelve Months Ended December 31, 2024
        U.S.   Latin America   Total
    Total locations, beginning of period   1,183     1,814     2,997  
    New locations opened   1     60     61  
    Locations acquired   28     10     38  
    Consolidation of existing pawn locations (1) (2)   (12 )   (58 )   (70 )
    Total locations, end of period   1,200     1,826     3,026  
     

    (1)        Store consolidations were primarily acquired locations which have been combined with overlapping stores and for which the Company expects to maintain a significant portion of the acquired customer base in the consolidated location.

    (2)        Includes 10 pawnshops located in Acapulco, Mexico that were severely damaged by a hurricane in the fall of 2023, which the Company elected to consolidate with other stores in this market. The Company expects to replace certain of these locations in this market over time as the city’s infrastructure recovers.

    Retail POS Payment Solutions

    As of December 31, 2024, AFF provided LTO and retail POS payment solutions for consumer goods and services through a network of approximately 13,600 active retail merchant partner locations, which is net of the closing of approximately 1,000 Conn’s HomePlus and American Freight locations due to bankruptcy during the fourth quarter of 2024. This compares to the active door count of approximately 11,600 locations at December 31, 2023. 

    FIRSTCASH HOLDINGS, INC.
    RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
    TO GAAP FINANCIAL MEASURES
    (UNAUDITED)

    The Company uses certain financial calculations such as adjusted net income, adjusted diluted earnings per share, EBITDA, adjusted EBITDA, free cash flow, adjusted free cash flow, adjusted return on equity, adjusted return on assets and constant currency results as factors in the measurement and evaluation of the Company’s operating performance and period-over-period growth. The Company derives these financial calculations on the basis of methodologies other than generally accepted accounting principles (“GAAP”), primarily by excluding from a comparable GAAP measure certain items the Company does not consider to be representative of its actual operating performance. These financial calculations are “non-GAAP financial measures” as defined under the SEC rules. The Company uses these non-GAAP financial measures in operating its business because management believes they are less susceptible to variances in actual operating performance that can result from the excluded items, other infrequent charges and currency fluctuations. The Company presents these financial measures to investors because management believes they are useful to investors in evaluating the primary factors that drive the Company’s core operating performance and provide greater transparency into the Company’s results of operations. However, items that are excluded and other adjustments and assumptions that are made in calculating these non-GAAP financial measures are significant components in understanding and assessing the Company’s financial performance. These non-GAAP financial measures should be evaluated in conjunction with, and are not a substitute for, the Company’s GAAP financial measures. Further, because these non-GAAP financial measures are not determined in accordance with GAAP, and are thus susceptible to varying calculations, the non-GAAP financial measures, as presented, may not be comparable to other similarly-titled measures of other companies.

    While acquisitions are an important part of the Company’s overall strategy, the Company has adjusted the applicable financial calculations to exclude merger and acquisition expenses and amortization of acquired AFF intangible assets. The Company does not consider these items to be related to the organic operations of the acquired businesses or its continuing operations and are generally not relevant to assessing or estimating the long-term performance of the acquired businesses. In addition, excluding these items allows for more accurate comparisons of the financial results to prior periods. Merger and acquisition expenses include incremental costs directly associated with merger and acquisition activities, including professional fees, legal expenses, severance, retention and other employee-related costs, contract breakage costs and costs related to the consolidation of technology systems and corporate facilities, among others. 

    The Company has certain leases in Mexico which are denominated in U.S. dollars. The lease liability of these U.S. dollar-denominated leases, which is considered a monetary liability, is remeasured into Mexican pesos using current period exchange rates, resulting in the recognition of foreign currency exchange gains or losses. The Company has adjusted the applicable financial measures to exclude these remeasurement gains or losses (1) because they are non-cash, non-operating items that could create volatility in the Company’s consolidated results of operations due to the magnitude of the end of period lease liability being remeasured and (2) to improve comparability of current periods presented with prior periods.

    FIRSTCASH HOLDINGS, INC.
    RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
    TO GAAP FINANCIAL MEASURES (CONTINUED)
    (UNAUDITED)

    Adjusted Net Income and Adjusted Diluted Earnings Per Share

    Management believes the presentation of adjusted net income and adjusted diluted earnings per share provides investors with greater transparency and provides a more complete understanding of the Company’s financial performance and prospects for the future by excluding items that management believes are non-operating in nature and are not representative of the Company’s core operating performance. In addition, management believes the adjustments shown below are useful to investors in order to allow them to compare the Company’s financial results for the current periods presented with the prior periods presented.

    The following table provides a reconciliation between net income and diluted earnings per share calculated in accordance with GAAP to adjusted net income and adjusted diluted earnings per share, which are shown net of tax (in thousands, except per share amounts):

        Three Months Ended December 31,   Twelve Months Ended December 31,
        2024   2023   2024   2023   2024   2023   2024   2023
        In
    Thousands    		   In
    Thousands    		   Per
    Share    		   Per
    Share    		   In
    Thousands    		   In
    Thousands    		   Per
    Share    		   Per
    Share
    Net income and diluted earnings per share, as reported   $      83,547   $ 69,589     $      1.86   $ 1.53     $    258,815   $ 219,301     $      5.73   $ 4.80  
    Adjustments, net of tax:                                
    Merger and acquisition expenses                    31     3,271                 —     0.07                1,706     6,089              0.04     0.13  
    Non-cash foreign currency loss (gain) related to lease liability                  504     (607 )            0.01     (0.01 )              2,627     (1,778 )            0.06     (0.04 )
    AFF purchase accounting and other adjustments              9,572     21,472              0.21     0.47              38,289     54,341              0.85     1.19  
    Other expenses (income), net              1,761     (879 )            0.04     (0.02 )              1,243     (1,079 )            0.02     (0.02 )
    Adjusted net income and diluted earnings per share   $      95,415   $ 92,846     $      2.12   $ 2.04     $    302,680   $ 276,874     $      6.70   $ 6.06  
     

    FIRSTCASH HOLDINGS, INC.
    RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
    TO GAAP FINANCIAL MEASURES (CONTINUED)
    (UNAUDITED)

    Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA

    The Company defines EBITDA as net income before income taxes, depreciation and amortization, interest expense and interest income and adjusted EBITDA as EBITDA adjusted for certain items, as listed below, that management considers to be non-operating in nature and not representative of its actual operating performance. The Company believes EBITDA and adjusted EBITDA are commonly used by investors to assess a company’s financial performance, and adjusted EBITDA is used as a starting point in the calculation of the consolidated total debt ratio as defined in the Company’s senior unsecured notes. The following table provides a reconciliation of net income to EBITDA and adjusted EBITDA (in thousands): 

        Three Months Ended   Twelve Months Ended
        December 31,   December 31,
        2024   2023   2024   2023
    Net income   $         83,547     $ 69,589     $       258,815     $ 219,301  
    Income taxes             25,986       21,899               83,961       73,548  
    Depreciation and amortization             26,434       27,635             104,941       109,161  
    Interest expense             27,197       26,586             105,226       93,243  
    Interest income                (528 )     (216 )             (1,935 )     (1,469 )
    EBITDA           162,636       145,493             551,008       493,784  
    Adjustments:                        
    Merger and acquisition expenses                     42       4,252                 2,228       7,922  
    Non-cash foreign currency loss (gain) related to lease liability                  720       (867 )               3,755       (2,540 )
    AFF purchase accounting and other adjustments (1)                     —       13,968                       —       13,968  
    Other expenses (income), net               2,287       (1,142 )               1,446       (1,402 )
    Adjusted EBITDA   $       165,685     $ 161,704     $       558,437     $ 511,732  
     

    (1)        For the three and twelve months ended December 31, 2023, amount represents other non-recurring costs included in administrative expenses related to a discontinued finance product.

    FIRSTCASH HOLDINGS, INC.
    RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
    TO GAAP FINANCIAL MEASURES (CONTINUED)
    (UNAUDITED)

    Free Cash Flow and Adjusted Free Cash Flow

    For purposes of its internal liquidity assessments, the Company considers free cash flow and adjusted free cash flow. The Company defines free cash flow as cash flow from operating activities less purchases of furniture, fixtures, equipment and improvements and net fundings/repayments of pawn loan and finance receivables, which are considered to be operating in nature by the Company but are included in cash flow from investing activities. Adjusted free cash flow is defined as free cash flow adjusted for merger and acquisition expenses paid that management considers to be non-operating in nature.

    Free cash flow and adjusted free cash flow are commonly used by investors as additional measures of cash, generated by business operations, that may be used to repay scheduled debt maturities and debt service or, following payment of such debt obligations and other non-discretionary items, that may be available to invest in future growth through new business development activities or acquisitions, repurchase stock, pay cash dividends or repay debt obligations prior to their maturities. These metrics can also be used to evaluate the Company’s ability to generate cash flow from business operations and the impact that this cash flow has on the Company’s liquidity. However, free cash flow and adjusted free cash flow have limitations as analytical tools and should not be considered in isolation or as a substitute for cash flow from operating activities or other income statement data prepared in accordance with GAAP. The following table reconciles cash flow from operating activities to free cash flow and adjusted free cash flow (in thousands):

        Three Months Ended   Twelve Months Ended
        December 31,   December 31,
        2024   2023   2024   2023
    Cash flow from operating activities   $        198,149     $ 99,105     $        539,958     $ 416,142  
    Cash flow from investing activities:                
    Pawn loans, net (1)                 (2,276 )     24,448                 (71,999 )     (34,978 )
    Finance receivables, net               (53,128 )     (27,448 )            (139,314 )     (115,442 )
    Purchases of furniture, fixtures, equipment and improvements               (12,213 )     (13,425 )               (68,245 )     (60,148 )
    Free cash flow              130,532       82,680                260,400       205,574  
    Merger and acquisition expenses paid, net of tax benefit                        31       3,271                     1,706       6,089  
    Adjusted free cash flow   $        130,563     $ 85,951     $        262,106     $ 211,663  
     

    (1)        Includes the funding of new loans net of cash repayments and recovery of principal through the sale of inventories acquired from forfeiture of pawn collateral.

    FIRSTCASH HOLDINGS, INC.
    RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
    TO GAAP FINANCIAL MEASURES (CONTINUED)
    (UNAUDITED)

    Adjusted Return on Equity and Adjusted Return on Assets

    Management believes the presentation of adjusted return on equity and adjusted return on assets provides investors with greater transparency and provides a more complete understanding of the Company’s financial performance by excluding items that management believes are non-operating in nature and not representative of the Company’s core operating performance.

    Annualized adjusted return on equity and adjusted return on assets is calculated as follows (dollars in thousands):

        Twelve Months Ended
        December 31, 2024
    Adjusted net income (1)   $ 302,680  
           
    Average stockholders’ equity (average of five most recent quarter-end balances)   $ 2,014,721  
    Adjusted return on equity (trailing twelve months adjusted net income divided by average equity)   15 %
           
    Average total assets (average of five most recent quarter-end balances)   $ 4,345,922  
    Adjusted return on assets (trailing twelve months adjusted net income divided by average total assets)   7 %
     
    (1)       See detail of adjustments to net income in the “Adjusted Net Income and Adjusted Diluted Earnings Per Share” section above.
     

    Constant Currency Results

    The Company’s reporting currency is the U.S. dollar, however, certain performance metrics discussed in this release are presented on a “constant currency” basis, which is considered a non-GAAP financial measure. The Company’s management uses constant currency results to evaluate operating results of business operations in Latin America, which are transacted in local currencies in Mexico, Guatemala and Colombia. The Company also has operations in El Salvador, where the reporting and functional currency is the U.S. dollar.

    The Company believes constant currency results provide valuable supplemental information regarding the underlying performance of its business operations in Latin America, consistent with how the Company’s management evaluates such performance and operating results. Constant currency results reported herein are calculated by translating certain balance sheet and income statement items denominated in local currencies using the exchange rate from the prior-year comparable period, as opposed to the current comparable period, in order to exclude the effects of foreign currency rate fluctuations for purposes of evaluating period-over-period comparisons. See the Latin America pawn segment tables elsewhere in this release for additional reconciliation of certain constant currency amounts to as reported GAAP amounts.

    FIRSTCASH HOLDINGS, INC.
    RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
    TO GAAP FINANCIAL MEASURES (CONTINUED)
    (UNAUDITED)
     
    Exchange Rates for the Mexican Peso, Guatemalan Quetzal and Colombian Peso
     
        December 31,   Favorable /
        2024   2023   (Unfavorable)
    Mexican peso / U.S. dollar exchange rate:                
    End-of-period   20.3   16.9     (20) %  
    Three months ended   20.1   17.6     (14) %  
    Twelve months ended   18.3   17.8     (3) %  
                     
    Guatemalan quetzal / U.S. dollar exchange rate:                
    End-of-period   7.7   7.8     1 %  
    Three months ended   7.7   7.8     1 %  
    Twelve months ended   7.8   7.8     — %  
                     
    Colombian peso / U.S. dollar exchange rate:                
    End-of-period   4,409   3,822     (15) %  
    Three months ended   4,348   4,070     (7) %  
    Twelve months ended   4,071   4,328     6 %  
     

    FIRSTCASH HOLDINGS, INC.
    INTERSEGMENT TRANSACTIONS
    (UNAUDITED)

    Intersegment transactions relate to the Company offering AFF’s LTO payment solution in its U.S. pawn stores and are eliminated to arrive at consolidated totals. For the three months ended December 31, 2024 and 2023, these intersegment amounts are as follows:

    • U.S. pawn retail merchandise sales includes $1.0 million and $1.6 million, respectively. Excluding these intersegment sales, consolidated U.S. retail merchandise sales totaled $266.3 million and $242.1 million, respectively.
    • U.S. pawn cost of retail merchandise sold includes $0.5 million and $0.9 million, respectively. Excluding these intersegment sales, consolidated U.S. cost of retail merchandise sold totaled $153.1 million and $140.5 million, respectively.
    • Retail POS payment solutions depreciation of leased merchandise includes $0.3 million and $0.5 million, respectively. Excluding these intersegment transactions, consolidated depreciation of leased merchandise totaled $97.9 million and $103.6 million, respectively.
    • Retail POS payment solutions provision for lease losses includes $0.1 million and $1.4 million, respectively. Excluding these intersegment transactions, consolidated provision for lease losses totaled $33.6 million and $34.2 million, respectively.

    For the twelve months ended December 31, 2024 and 2023, these intersegment amounts are as follows:

    • U.S. pawn retail merchandise sales includes $4.1 million and $6.5 million, respectively. Excluding these intersegment sales, consolidated U.S. retail merchandise sales totaled $965.3 million and $847.7 million, respectively.
    • U.S. pawn cost of retail merchandise sold includes $2.2 million and $3.5 million, respectively. Excluding these intersegment sales, consolidated U.S. cost of retail merchandise sold totaled $558.8 million and $487.1 million, respectively.
    • Retail POS payment solutions depreciation of leased merchandise includes $1.6 million and $2.1 million, respectively. Excluding these intersegment transactions, consolidated depreciation of leased merchandise totaled $433.3 million and $411.5 million, respectively.
    • Retail POS payment solutions provision for lease losses includes $0.5 million and $1.6 million, respectively. Excluding these intersegment transactions, consolidated provision for lease losses totaled $163.4 million and $175.9 million, respectively.

    As of December 31, 2024 and 2023, these intersegment amounts are as follows:

    • Retail POS payment solutions leased merchandise, net includes $0.2 million and $0.5 million, respectively. Excluding these intersegment transactions, consolidated net leased merchandise totaled $128.4 million and $171.2 million, respectively.

    For further information, please contact: 
    Gar Jackson
    Global IR Group
    Phone:    (817) 886-6998
    Email:     gar@globalirgroup.com

    Doug Orr, Executive Vice President and Chief Financial Officer
    Phone:    (817) 258-2650
    Email:     investorrelations@firstcash.com
    Website:  investors.firstcash.com

    The MIL Network –

  • MIL-OSI: Check Point Software Reports Fourth Quarter and 2024 Full Year Results

    Source: GlobeNewswire (MIL-OSI)

    TEL AVIV, Israel, Jan. 30, 2025 (GLOBE NEWSWIRE) — Check Point® Software Technologies Ltd. (NASDAQ: CHKP), today announced its financial results for the fourth quarter and full year ended December 31, 2024.

    Fourth Quarter 2024 Highlights

    • Calculated Billings* reached $959 million, an 11 percent increase year over year
    • Remaining Performance Obligation (RPO)**: $2.5 billion, a 12 percent increase year over year
    • Total Revenues: $704 million, a 6 percent increase year over year
    • Product, License & Subscription Revenues: $463 million, a 9 percent increase year over year
    • GAAP Operating Income: $254 million, representing 36 percent of revenues
    • Non-GAAP Operating Income: $306 million, representing 44 percent of revenues
    • GAAP EPS: $2.30, a 7 percent increase year over year
    • Non-GAAP EPS: $2.70, a 5 percent increase year over year

    Full Year 2024 Highlights

    • Calculated Billings* reached $2,658 million, a 9 percent increase year over year
    • Total Revenues: $2,565 million, a 6 percent increase year over year
    • Security Subscriptions Revenues: $1,104 million, a 13 percent increase year over year
    • GAAP EPS: $7.46, a 5 percent increase year over year
    • Non-GAAP EPS: $9.16, a 9 percent increase year over year

    “We delivered exceptional fourth quarter results, a wonderful way to transition into my new Executive Chairman role. The success in the quarter was underscored by strong 8 percent revenue growth in our core Quantum Force appliance business, our industry leading Harmony E-mail solution, and expanded adoption of the Infinity platform,” said, Gil Shwed, Founder and Chairman of the Board of Check Point Software. “I would like to thank Check Point’s customers, partners, and the Global Check Point Team for their contributions to our continued success. I look forward to Check Point achieving new heights under the leadership of our new Chief Executive Officer, Nadav Zafrir,” concluded, Mr. Shwed.

    “I would like to thank Gil and the Board for the opportunity to lead such an exemplary organization. 2024 was a successful year and provides a great springboard for 2025 and beyond,” stated Nadav Zafrir, Chief Executive Officer of Check Point Software. “My first one hundred days are focused on meeting with customers and partners to understand the key challenges they face in today’s unprecedented threat environment. From my conversations so far, I have become increasingly confident that Check Point is uniquely positioned to address the cybersecurity demands of enterprises worldwide. Check Point’s future is bright, and we are focused on driving market share expansion and taking growth to the next levels,” stated Mr. Zafrir.

    “After a successful fourth quarter and 2024, we are starting 2025 with an expanded executive team to balance our corporate and Go-To-Market leadership roles, and bring even more attention to customer facing functions,” said Nadav Zafrir, CEO of Check Point Software. Among the new roles joining the executive team is that of Chief Revenue Officer. Itai Greenberg will serve in this role, driving our global top-line revenue across our platform worldwide. He brings more than two decades of experience in product management and sales roles, having most recently served as Check Point’s Chief Strategy Officer and head of the Cloud and SASE businesses. Replacing Itai in the role of Chief Strategy Officer, we welcome Roi Karo to Check Point. Roi brings more than two decades of expertise in security, AI, and big data with a focus on strategy and planning.

    In conclusion, after three successful years as Check Point’s President, Rupal Hollenbeck has chosen to conclude her tenure at the end of the first quarter and will remain available to support the smooth transition of the new executive team members. “I want to thank Rupal for her incredible work and dedication over the last three years during which the Go-To-Market organizations composition, reach, and focus was transformed all around the world. We wish her all the best in her future endeavors,” said Nadav Zafrir, CEO of Check Point Software. “We welcome Itai and Roi into their new executive team roles. I am excited about the opportunities before us, and I am more confident than ever that the best of Check Point is yet to come,” concluded, Mr. Zafrir.

    Financial Highlights Commentary

    • Cash Balances, Marketable Securities & Short-Term Deposits: $2,784 million as of December 31, 2024, compared to $2,960 million as of December 31, 2023. The decrease in cash is primarily a result of $186 million net of cash consideration utilized for Cyberint Ltd. acquisition in 2024.
    • Share Repurchase Program: During the fourth quarter of 2024, the company repurchased approximately 1.7 million shares at a total cost of approximately $325 million. During full year 2024, we repurchased approximately 7.7 million shares at a total cost of approximately $1,300 million.
    • Cash Flow: Cash flow from operations was $1,059, which included $18 million of costs related to our currency hedging transactions, and acquisition-related costs were insignificant. This compares to $1,035 million in 2023, which included $39 million of costs related to our currency hedging transactions and $25 million in costs related to acquisitions.

    For information regarding the non-GAAP financial measures discussed in this release, as well as a reconciliation of such non-GAAP financial measures to the most directly comparable GAAP financial measures, please see “Use of Non-GAAP Financial Information” and “Reconciliation of GAAP to Non-GAAP Financial Information.”

    Conference Call and Webcast Information
    Check Point will host a conference call with the investment community on January 30, 2025, at 8:30 AM ET/5:30 AM PT. To listen to the live webcast or replay, please visit the website www.checkpoint.com/ir.
    First Quarter 2025 Investor Conference Participation Schedule

    • Wolfe Research March Madness 1×1 Conference
      February 27, 2025, NY, NY – 1×1 meetings
    • Susquehanna Technology Conference
      February 27, 2025, NY, NY – 1×1 meetings
    • Raymond James 2025 Institutional Investor Conference
      March 3, 2025, Orlando, FL – Fireside & 1×1 meetings
    • Morgan Stanley 2025 Media, Telecommunications & Technology Conference
      March 4, 2025, SF, CA – Fireside & 1×1 meetings
    • Roth Capital Partners 37thAnnual Conference
      March 17-18, 2025, Dana Point, CA – 1×1 meetings

    Members of Check Point’s management team are expected to present at these conferences and discuss the latest company strategies and initiatives. Check Point’s conference presentations are expected to be available via webcast on the company’s web site. To hear these presentations and access the most updated information please visit the company’s web site at www.checkpoint.com/ir. The schedule is subject to change.

    Follow Check Point via:
    Twitter: http://www.twitter.com/checkpointsw
    Facebook: https://www.facebook.com/checkpointsoftware
    Blog: http://blog.checkpoint.com
    YouTube: http://www.youtube.com/user/CPGlobal
    LinkedIn: https://www.linkedin.com/company/check-point-software-technologies

    About Check Point Software Technologies Ltd.
    Check Point Software Technologies Ltd. (http://www.checkpoint.com) is a leading AI-powered, cloud-delivered cyber security platform provider protecting over 100,000 organizations worldwide. Check Point leverages the power of AI everywhere to enhance cyber security efficiency and accuracy through its Infinity Platform, with industry-leading catch rates enabling proactive threat anticipation and smarter, faster response times. The comprehensive platform includes cloud-delivered technologies consisting of Check Point Harmony to secure the workspace, Check Point CloudGuard to secure the cloud, Check Point Quantum to secure the network, and Check Point Infinity Core Services for collaborative security operations and services.

    Legal Notice Regarding Forward-Looking Statements
    This press release contains forward-looking statements. Forward-looking statements generally relate to future events or our future financial or operating performance. Forward-looking statements in this press release include, but are not limited to, statements related to our management transitions, expectations regarding our products and solutions, and our participation in investor conferences and Check Point Experience (CPX) events and other events during the first quarter of 2025. Our expectations and beliefs regarding these matters may not materialize, and actual results or events in the future are subject to risks and uncertainties that could cause actual results or events to differ materially from those projected. These risks include our ability to continue to develop platform capabilities and solutions; customer acceptance and purchase of our existing solutions and new solutions; the market for IT security continuing to develop; competition from other products and services; appointments and departures of our executive officers; and general market, political, economic, and business conditions, including acts of terrorism or war. The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our filings with the Securities and Exchange Commission, including our Annual Report on Form 20-F filed with the Securities and Exchange Commission on April 2, 2024. The forward-looking statements in this press release are based on information available to Check Point as of the date hereof, and Check Point disclaims any obligation to update any forward-looking statements, except as required by law.

    Use of Non-GAAP Financial Information
    In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Check Point uses non-GAAP measures of operating income, net income and earnings per diluted share, which are adjustments from results based on GAAP to exclude, as applicable, stock-based compensation expenses, amortization of intangible assets and acquisition related expenses and the related tax affects. Check Point’s management believes the non-GAAP financial information provided in this release is useful to investors’ understanding and assessment of Check Point’s ongoing core operations and prospects for the future. Historically, Check Point has also publicly presented these supplemental non-GAAP financial measures to assist the investment community to see the company “through the eyes of management,” and thereby enhance understanding of its operating performance. The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. A reconciliation of the non-GAAP financial measures discussed in this press release to the most directly comparable GAAP financial measures is included with the financial statements contained in this press release. Management uses both GAAP and non-GAAP information in evaluating and operating business internally and as such has determined that it is important to provide this information to investors.

    * Calculated Billings is a measure that we defined as total revenues recognized in accordance with GAAP plus the change in Total Deferred Revenues during the period

    ** Remaining Performance Obligation (RPO) is a measure that represents the total value of non-cancellable contracted products and/or services that are yet to be recognized as Revenue as of the period

     
    CHECK POINT SOFTWARE TECHNOLOGIES LTD.
    CONSOLIDATED STATEMENT OF INCOME
     
    (Unaudited, in millions, except per share amounts)
           
      Three Months Ended   Year Ended
      December 31,   December 31,
      2024   2023   2024   2023
    Revenues:              
    Products and licenses $ 170.6   $ 158.3   $ 507.9   $ 497.4
    Security subscriptions   292.2     265.8     1,104.2     981.2
    Total revenues from products and security subscriptions   462.8     424.1     1,612.1     1,478.6
    Software updates and maintenance   240.9     239.4     952.9     936.1
    Total revenues   703.7     663.5     2,565.0     2,414.7
                   
    Operating expenses:              
    Cost of products and licenses   29.6     28.0     97.8     99.3
    Cost of security subscriptions   19.7     17.2     72.6     57.0
    Total cost of products and security subscriptions   49.3     45.2     170.4     156.3
    Cost of Software updates and maintenance   33.4     30.5     123.9     112.3
    Amortization of technology   7.6     5.8     25.0     14.0
    Total cost of revenues   90.3     81.5     319.3     282.6
                   
    Research and development   101.1     100.0     394.9     368.9
    Selling and marketing   232.1     200.5     862.9     747.1
    General and administrative   25.9     29.7     111.9     117.0
    Total operating expenses   449.4     411.7     1,689.0     1,515.6
                   
    Operating income   254.3     251.8     876.0     899.1
    Financial income, net   24.5     18.4     96.1     76.5
    Income before taxes on income   278.8     270.2     972.1     975.6
    Taxes on income (tax benefit)   21.3     21.0     126.4     135.3
    Net income $ 257.5   $ 249.2   $ 845.7   $ 840.3
                           
    Basic earnings per share $ 2.36   $ 2.19   $ 7.65   $ 7.19
    Number of shares used in computing basic earnings per share   109.2     114.0     110.6     116.9
                           
    Diluted earnings per share $ 2.30   $ 2.15   $ 7.46   $ 7.10
    Number of shares used in computing diluted earnings per share   112.1     115.9     113.4     118.3
     
     
    CHECK POINT SOFTWARE TECHNOLOGIES LTD.
    SELECTED FINANCIAL METRICS
     (Unaudited, in millions, except per share amounts)
             
        Three Months Ended   Year Ended
        December 31,   December 31,
        2024   2023   2024   2023
                     
    Revenues   $ 703.7   $ 663.5   $ 2,565.0   $ 2,414.7
    Non-GAAP operating income     306.4     308.6     1,097.5     1,079.1
    Non-GAAP net income     303.2     298.5     1,039.1     997.1
    Diluted Non-GAAP Earnings per share   $ 2.70   $ 2.57   $ 9.16   $ 8.42
    Number of shares used in computing diluted Non-GAAP Earnings per share     112.1     115.9     113.4     118.3
                             
     
    CHECK POINT SOFTWARE TECHNOLOGIES LTD.
    RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION
    (Unaudited, in millions, except per share amounts)
             
        Three Months Ended   Year Ended
        December 31,   December 31,
          2024       2023       2024       2023  
                     
    GAAP operating income   $ 254.3     $ 251.8     $ 876.0     $ 899.1  
    Stock-based compensation (1)     29.8       39.9       149.7       145.3  
    Amortization of intangible assets and acquisition related expenses (2)     22.3       16.9       71.8       34.7  
    Non-GAAP operating income   $ 306.4     $ 308.6     $ 1,097.5     $ 1,079.1  
                     
    GAAP net income   $ 257.5     $ 249.2     $ 845.7     $ 840.3  
    Stock-based compensation (1)     29.8       39.9       149.7       145.3  
    Amortization of intangible assets and acquisition related expenses (2)     22.3       16.9       71.8       34.7  
    Taxes on the above items (3)     (6.4 )     (7.5 )     (28.1 )     (23.2 )
                                     
    Non-GAAP net income   $ 303.2     $ 298.5     $ 1,039.1     $ 997.1  
                     
    Diluted GAAP Earnings per share   $ 2.30     $ 2.15     $ 7.46     $ 7.10  
    Stock-based compensation (1)     0.26       0.34       1.32       1.23  
    Amortization of intangible assets and acquisition related expenses (2)     0.20       0.15       0.63       0.29  
    Taxes on the above items (3)     (0.06 )     (0.07 )     (0.25 )     (0.20 )
    Diluted Non-GAAP Earnings per share   $ 2.70     $ 2.57     $ 9.16     $ 8.42  
                     
    Number of shares used in computing diluted Non-GAAP Earnings per share     112.1       115.9       113.4       118.3  
                     
    (1) Stock-based compensation:                
    Cost of products and licenses   $ 0.1     $ 0.1     $ 0.4     $ 0.4  
    Cost of software updates and maintenance     2.0       2.4       8.2       7.3  
    Research and development     10.8       14.2       53.1       48.7  
    Selling and marketing     12.0       15.2       58.2       56.3  
    General and administrative     4.9       8.0       29.8       32.6  
          29.8       39.9       149.7       145.3  
                     
    (2) Amortization of intangible assets and acquisition related expenses:                
    Amortization of technology-cost of revenues     7.6       5.8       25.0       14.0  
    Research and development     1.7       2.0       6.5       7.0  
    Selling and marketing     13.0       9.1       40.3       13.7  
          22.3       16.9       71.8       34.7  
    (3) Taxes on the above items     (6.4 )     (7.5 )     (28.1 )     (23.2 )
    Total, net   $ 45.7     $ 49.3     $ 193.4     $ 156.8  
     
     
    CHECK POINT SOFTWARE TECHNOLOGIES LTD.
    CONDENSED CONSOLIDATED BALANCE SHEET DATA
     
    (In millions)
     
    ASSETS
               
          December 31,   December 31,
          2024
    (Unaudited)    		   2023
    (Audited)
    Current assets:          
    Cash and cash equivalents     $ 506.2   $ 537.7
    Marketable securities and short-term deposits       865.7     992.3
    Trade receivables, net       728.8     657.7
    Prepaid expenses and other current assets       92.7     70.0
    Total current assets       2,193.4     2,257.7
               
    Long-term assets:          
    Marketable securities       1,411.9     1,429.7
    Property and equipment, net       80.8     80.4
    Deferred tax asset, net       63.6     81.8
    Goodwill and other intangible assets, net       1,897.1     1,748.5
    Other assets       96.6     97.4
    Total long-term assets       3,550.0     3,437.8
               
    Total assets     $ 5,743.4   $ 5,695.5
     
               
    LIABILITIES AND
    SHAREHOLDERS’ EQUITY
               
    Current liabilities:          
    Deferred revenues     $ 1,471.3     $ 1,413.8  
    Trade payables and other accrued liabilities       472.9       502.3  
    Total current liabilities       1,944.2       1,916.1  
               
    Long-term liabilities:          
    Long-term deferred revenues       529.0       493.9  
    Income tax accrual       448.5       436.1  
    Other long-term liabilities       32.3       28.4  
            1,009.8       958.4  
               
    Total liabilities       2,954.0       2,874.5  
               
    Shareholders’ equity:          
    Share capital       0.8       0.8  
    Additional paid-in capital       3,052.8       2,732.5  
    Treasury shares at cost       (14,267.7 )     (13,041.2 )
    Accumulated other comprehensive gain (loss)       (10.3 )     (39.2 )
    Retained earnings       14,013.8       13,168.1  
    Total shareholders’ equity       2,789.4       2,821.0  
                       
    Total liabilities and shareholders’ equity     $ 5,743.4     $ 5,695.5  
    Total cash and cash equivalents, marketable securities, and short-term deposits     $ 2,783.8     $ 2,959.7  
     
     
    CHECK POINT SOFTWARE TECHNOLOGIES LTD.
    SELECTED CONSOLIDATED CASH FLOW DATA
     
    (Unaudited, in millions)
     
      Three Months Ended   Year Ended
      December 31,   December 31,
        2024       2023       2024       2023  
    Cash flow from operating activities:              
    Net income $ 257.5     $ 249.2     $ 845.7     $ 840.3  
    Adjustments to reconcile net income to net cash provided by operating activities:              
    Depreciation of property and equipment   6.3       5.7       24.0       23.1  
    Amortization of intangible assets   19.2       13.5       59.6       24.3  
    Stock-based compensation   29.8       39.9       149.7       145.3  
    Realized loss on marketable securities   –       –       –       6.7  
    Increase in trade and other receivables, net   (337.1 )     (324.3 )     (78.9 )     (61.0 )
    Increase in deferred revenues, trade payables and other accrued liabilities   273.0       270.6       59.7       65.5  
    Deferred income taxes, net   0.3       (18.8 )     (1.0 )     (9.5 )
    Net cash provided by operating activities   249.0       235.8       1,058.8       1,034.7  
                   
    Cash flow from investing activities:              
    Payment in conjunction with acquisitions, net of acquired cash   –       (3.8 )     (185.8 )     (458.8 )
    Investment in property and equipment   (6.5 )     (4.7 )     (24.2 )     (18.6 )
    Net cash used in investing activities   (6.5 )     (8.5 )     (210.0 )     (477.4 )
                   
    Cash flow from financing activities:              
    Proceeds from issuance of shares upon exercise of options   9.0       16.0       258.6       133.7  
    Purchase of treasury shares   (325.0 )     (313.2 )     (1,299.9 )     (1,287.6 )
    Payments related to shares withheld for taxes   (1.5 )     (1.2 )     (18.6 )     (11.0 )
    Net cash used in financing activities   (317.5 )     (298.4 )     (1,059.9 )     (1,164.9 )
                   
    Unrealized gain (loss) on marketable securities, net   (14.0 )     42.1       35.2       64.1  
                   
    Decrease in cash and cash equivalents, marketable securities, and short-term deposits   (89.0 )     (29.0 )     (175.9 )     (543.5 )
                   
    Cash and cash equivalents, marketable securities, and short-term deposits at the beginning of the period   2,872.8       2,988.7       2,959.7       3,503.2  
                   
    Cash and cash equivalents, marketable securities, and short-term deposits at the end of the period $ 2,783.8     $ 2,959.7     $ 2,783.8     $ 2,959.7  
     
       
    Investors: Kip E. Meintzer
    Check Point Software Technologies, Ltd.
    +1.650.628.2040
    ir@checkpoint.com    		 Media: Gil Messing
    Check Point Software Technologies, Ltd.
    +1.650.628.2260
    press@checkpoint.com

    The MIL Network –

  • MIL-OSI: SHELL PLC 4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    Source: GlobeNewswire (MIL-OSI)

                                 
    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS    		        
                                                         
     
    SUMMARY OF UNAUDITED RESULTS
    Quarters $ million   Full year
    Q4 2024 Q3 2024 Q4 2023 %¹   Reference 2024 2023 %
    928    4,291    474    -78 Income/(loss) attributable to Shell plc shareholders   16,093    19,359    -17
    3,661    6,028    7,306    -39 Adjusted Earnings A 23,716    28,250    -16
    14,281    16,005    16,335    -11 Adjusted EBITDA A 65,803    68,538    -4
    13,162    14,684    12,575    -10 Cash flow from operating activities   54,684    54,191    +1
    (4,431)   (3,857)   (5,657)     Cash flow from investing activities   (15,154)   (17,734)    
    8,731    10,827    6,918      Free cash flow G 39,530    36,457     
    6,924    4,950    7,113      Cash capital expenditure C 21,084    24,392     
    9,401    9,570    10,897    -2 Operating expenses F 36,918    39,960    -8
    9,138    8,864    10,565    +3 Underlying operating expenses F 35,707    39,201    -9
    11.3% 12.8% 12.8%   ROACE2 D 11.3% 12.8%  
    77,078    76,613    81,541      Total debt E 77,078    81,541     
    38,809    35,234    43,542      Net debt E 38,809    43,542     
    17.7% 15.7% 18.8%   Gearing E 17.7% 18.8%  
    2,815    2,801    2,827    +1 Oil and gas production available for sale (thousand boe/d)   2,836    2,791    +2
    0.15    0.69    0.07 -78 Basic earnings per share ($)   2.55    2.88    -11
    0.60    0.96    1.11    -38 Adjusted Earnings per share ($) B 3.76    4.20    -10
    0.3580    0.3440    0.3440    +4 Dividend per share ($)   1.3900    1.2935    +7

    1.Q4 on Q3 change

    2.Effective first quarter 2024, the definition has been amended and comparative information has been revised. See Reference D.

    Quarter Analysis1

    Income attributable to Shell plc shareholders, compared with the third quarter 2024, reflected higher exploration well write-offs, lower margins from crude and oil products trading and optimisation, lower Marketing margins and volumes, lower LNG trading and optimisation margins, lower realised oil prices, and unfavourable tax movements.

    Fourth quarter 2024 income attributable to Shell plc shareholders also included net impairment charges and reversals of $2.2 billion, and net losses related to sale of assets. These items are included in identified items amounting to a net loss of $2.8 billion in the quarter. This compares with identified items in the third quarter 2024 which amounted to a net loss of $1.3 billion.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as income attributable to Shell plc shareholders and adjusted for the above identified items.

    Cash flow from operating activities for the fourth quarter 2024 was $13.2 billion, and primarily driven by Adjusted EBITDA, and working capital inflows of $2.4 billion partly offset by tax payments of $2.9 billion, and outflows relating to the timing impact of payments relating to emission certificates and biofuel programmes of $1.4 billion. The working capital inflows mainly reflected accounts receivable and payable movements, and initial margin inflow.

    Cash flow from investing activities for the quarter was an outflow of $4.4 billion, and included cash capital expenditure of $6.9 billion, partly offset by net other investing cash inflows of $1.1 billion, and divestment proceeds of $0.8 billion.

    Net debt and Gearing: At the end of the fourth quarter 2024, net debt was $38.8 billion, compared with $35.2 billion at the end of the third quarter 2024, mainly reflecting lease additions of $5.4 billion, share buybacks, cash dividends paid to Shell plc shareholders, and interest payments, partly offset by free cash flow. Gearing was 17.7% at the end of the fourth quarter 2024, compared with 15.7% at the end of the third quarter 2024, mainly driven by higher net debt.

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    Shareholder distributions

    Total shareholder distributions in the quarter amounted to $5.7 billion comprising repurchases of shares of $3.6 billion and cash dividends paid to Shell plc shareholders of $2.1 billion. Dividends declared to Shell plc shareholders for the fourth quarter 2024 amount to $0.3580 per share. Shell has now completed $3.5 billion of share buybacks announced in the third quarter 2024 results announcement. Today, Shell announces a share buyback programme of $3.5 billion which is expected to be completed by the first quarter 2025 results announcement.

    Full Year Analysis1

    Income attributable to Shell plc shareholders, compared with the full year 2023, reflected lower LNG trading and optimisation margins, lower realised prices, lower refining margins, as well as lower trading and optimisation margins of power and pipeline gas in Renewables and Energy Solutions, partly offset by lower operating expenses, and higher realised Chemicals margins.

    By focusing the portfolio and simplifying the organisation, $3.1 billion of pre-tax structural cost reductions3 were delivered through 2024 compared with 2022 levels, with $2.1 billion in the full year 2024.

    Full year 2024 income attributable to Shell plc shareholders also included net impairment charges and reversals of $4.4 billion, reclassifications from equity to profit and loss of cumulative currency translation differences related to funding structures, unfavourable movements relating to an accounting mismatch due to fair value accounting of commodity derivatives, and charges related to redundancy and restructuring. These charges, reclassifications and movements are included in identified items amounting to a net loss of $7.4 billion. This compares with identified items in the full year 2023 which amounted to a net loss of $8.2 billion.

    Adjusted Earnings and Adjusted EBITDA2 for the full year 2024 were driven by the same factors as income attributable to Shell plc shareholders and adjusted for identified items and the cost of supplies adjustment of positive $0.3 billion.

    Cash flow from operating activities for the full year 2024 was $54.7 billion, and primarily driven by Adjusted EBITDA, and working capital inflows of $2.1 billion, partly offset by tax payments of $12.0 billion.

    Cash flow from investing activities for the full year 2024 was an outflow of $15.2 billion and included cash capital expenditure of $21.1 billion, partly offset by divestment proceeds of $2.8 billion, and interest received of $2.4 billion.

    This Unaudited Condensed Financial Report, together with supplementary financial and operational disclosure for this quarter, is available at www.shell.com/investors 4 . Details of progress to date on the financial targets that were announced during Capital Markets Day in June 2023 is available at https://www.shell.com/progress-on-cmd24.html 4.

    1.All earnings amounts are shown post-tax, unless stated otherwise.

    2.Adjusted EBITDA is without taxation.

    3.See Reference J.

    4.Not incorporated by reference.

    FOURTH QUARTER 2024 PORTFOLIO DEVELOPMENTS

    Upstream

    In October 2024, we announced the start of production of the floating production storage and offloading facility (FPSO) Marechal Duque de Caxias in the Mero field, in the pre-salt area of the Santos Basin, offshore Brazil. Also known as Mero-3, the FPSO has an operational capacity of 180,000 barrels of oil per day (Shell share 19.3%).

    In December 2024, we, along with Equinor ASA, announced the combination of our UK offshore oil and gas assets and expertise to form a new company which will be the UK North Sea’s biggest independent producer. On deal completion, the new independent producer will be jointly owned by Equinor (50%) and Shell (50%). Completion of the transaction remains subject to approvals and is expected by the end of 2025.

    In December 2024, we announced a final investment decision (FID) on Bonga North, a deep-water project off the coast of Nigeria. Shell (55%) operates the Bonga field in partnership with Esso Exploration and Production Nigeria Ltd. (20%), Nigerian Agip Exploration Ltd. (12.5%), and TotalEnergies Exploration and Production Nigeria Ltd. (12.5%), on behalf of the Nigerian National Petroleum Company Limited.

    In January 2025, we announced the start of production at the Shell-operated Whale floating production facility in the Gulf of Mexico. The Whale development is owned by Shell (60%, operator) and Chevron U.S.A. Inc. (40%).

             Page 2

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    Chemicals and Products

    In January 2025, CNOOC and Shell Petrochemicals Company Limited (CSPC), a 50:50 joint venture between Shell and CNOOC Petrochemicals Investment Ltd, has taken a FID to expand its petrochemical complex in Daya Bay, Huizhou, south China.

    Renewables and Energy Solutions

    In October 2024, we signed an agreement to acquire a 100% equity stake in RISEC Holdings, LLC, which owns a 609-megawatt (MW) two-unit combined-cycle gas turbine power plant in Rhode Island, USA. The deal was completed in January 2025.

             Page 2

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    PERFORMANCE BY SEGMENT

                                                         
     
    INTEGRATED GAS        
    Quarters $ million   Full year
    Q4 2024 Q3 2024 Q4 2023 %¹   Reference 2024 2023 %
    1,744    2,631    1,733    -34 Segment earnings   9,590    7,058    +36
    (421)   (240)   (2,235)     Of which: Identified items A (1,800)   (6,861)    
    2,165    2,871    3,968    -25 Adjusted Earnings A 11,390    13,919    -18
    4,568    5,234    6,584    -13 Adjusted EBITDA A 20,978    23,773    -12
    4,391    3,623    3,597    +21 Cash flow from operating activities A 16,909    17,520    -3
    1,337    1,236    1,196      Cash capital expenditure C 4,766    4,196     
    116    136    113    -15 Liquids production available for sale (thousand b/d)   132    128    +2
    4,574    4,669    4,570    -2 Natural gas production available for sale (million scf/d)   4,769    4,700    +1
    905    941    901    -4 Total production available for sale (thousand boe/d)   954    939    +2
    7.06    7.50    7.06    -6 LNG liquefaction volumes (million tonnes)   29.09    28.29    +3
    15.50    17.04    18.09    -9 LNG sales volumes (million tonnes)   65.82    67.09    -2

    1.Q4 on Q3 change

    Integrated Gas includes liquefied natural gas (LNG), conversion of natural gas into gas-to-liquids (GTL) fuels and other products. It includes natural gas and liquids exploration and extraction, and the operation of the upstream and midstream infrastructure necessary to deliver these to market. Integrated Gas also includes the marketing, trading and optimisation of LNG.

    Quarter Analysis1

    Segment earnings, compared with the third quarter 2024, reflected the net effect of lower contributions from trading and optimisation mainly driven by the comparative (non-cash) impact of expiring hedging contracts and slightly higher realised prices (decrease of $340 million), lower volumes (decrease of $283 million), and higher exploration well write-offs (increase of $275 million), partly offset by lower operating expenses (decrease of $97 million).

    Fourth quarter 2024 segment earnings also included impairment charges of $339 million and a loss of $96 million related to sale of assets, partly offset by favourable movements of $109 million relating to an accounting mismatch due to fair value accounting of commodity derivatives. These charges and favourable movements are part of identified items and compare with the third quarter 2024 which included unfavourable movements of $213 million due to the fair value accounting of commodity derivatives. As part of Shell’s normal business, commodity derivative hedge contracts are entered into for mitigation of economic exposures on future purchases, sales and inventory.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items.

    Cash flow from operating activities for the quarter was primarily driven by Adjusted EBITDA, net cash inflows related to derivatives of $120 million and working capital inflows of $114 million, partly offset by tax payments of $635 million.

    Total oil and gas production, compared with the third quarter 2024, decreased by 4% mainly due to planned maintenance in Pearl GTL (Qatar). LNG liquefaction volumes decreased by 6% mainly due to lower feedgas supply and fewer cargoes due to the timing of liftings.

    Full Year Analysis1

    Segment earnings, compared with the full year 2023, reflected the combined effect of lower contributions from trading and optimisation and lower realised prices (decrease of $3,819 million), partly offset by higher volumes (increase of $514 million), lower operating expenses (decrease of $478 million), and favourable deferred tax movements ($399 million).

    Full year 2024 segment earnings also included unfavourable movements of $1,088 million relating to an accounting mismatch due to fair value accounting of commodity derivatives, impairment charges of $363 million, and a net loss of $96 million related to sale of assets. These unfavourable movements and charges are part of identified items and compare with the full year 2023 which included unfavourable movements of $4,407 million due to the fair value accounting of commodity derivatives, and net impairment charges and reversals of $2,247 million. As part of Shell’s normal business, commodity derivative hedge contracts are entered into for mitigation of economic exposures on future purchases, sales and inventory.

             Page 3

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items.

    Cash flow from operating activities for the full year 2024 was primarily driven by Adjusted EBITDA, and working capital inflows of $467 million, partly offset by tax payments of $2,955 million and net cash outflows related to derivatives of $1,466 million.

    Total oil and gas production, compared with the full year 2023, increased by 2% mainly due to ramp-up of fields in Oman and Australia. LNG liquefaction volumes increased by 3% mainly due to lower maintenance in Australia.

    1.All earnings amounts are shown post-tax, unless stated otherwise.

    2.Adjusted EBITDA is without taxation.

             Page 4

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                                                         
     
    UPSTREAM          
    Quarters $ million   Full year
    Q4 2024 Q3 2024 Q4 2023 %¹   Reference 2024 2023 %
    1,031    2,289    2,151    -55 Segment earnings   7,772    8,539    -9
    (651)   (153)   (909)     Of which: Identified items A (623)   (1,267)    
    1,682    2,443    3,060    -31 Adjusted Earnings A 8,395    9,806    -14
    7,676    7,871    7,872    -2 Adjusted EBITDA A 31,264    30,622    +2
    4,509    5,268    5,787    -14 Cash flow from operating activities A 21,244    21,450    -1
    2,076    1,974    2,436      Cash capital expenditure C 7,890    8,343     
    1,332    1,321    1,361    +1 Liquids production available for sale (thousand b/d)   1,320    1,325    —
    3,056    2,844    2,952    +7 Natural gas production available for sale (million scf/d)   2,964    2,754    +8
    1,859    1,811    1,870    +3 Total production available for sale (thousand boe/d)   1,831    1,800    +2

    1.Q4 on Q3 change

    The Upstream segment includes exploration and extraction of crude oil, natural gas and natural gas liquids. It also markets and transports oil and gas, and operates the infrastructure necessary to deliver them to the market.

    Quarter Analysis1

    Segment earnings, compared with the third quarter 2024, reflected higher operating expenses (increase of $291 million), higher exploration well write-offs (increase of $283 million), unfavourable tax movements ($245 million) and lower realised liquids prices (decrease of $227 million), partly offset by higher volumes (increase of $370 million).

    Fourth quarter 2024 segment earnings also included a loss of $161 million related to the impact of the weakening Brazilian real on a deferred tax position, and net impairment charges and reversals of $152 million. These charges are part of identified items, and compare with the third quarter 2024 which included charges of $138 million related to redundancy and restructuring and charges of $104 million related to decommissioning provisions.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items.

    Cash flow from operating activities for the quarter was primarily driven by Adjusted EBITDA, partly offset by tax payments of $2,019 million and working capital outflows of $611 million.

    Total production, compared with the third quarter 2024, increased mainly due to new oil production and lower scheduled maintenance.

    Full Year Analysis1

    Segment earnings, compared with the full year 2023, reflected unfavourable tax movements ($1,289 million), lower realised prices (decrease of $949 million) and higher exploration well write-offs (increase of $541 million), partly offset by the comparative favourable impact of $962 million mainly relating to gas storage effects.

    Full year 2024 segment earnings also included a loss of $325 million related to the impact of the weakening Brazilian real on a deferred tax position, net impairment charges and reversals of $323 million and charges of $214 million related to redundancy and restructuring, partly offset by gains of $638 million related to the impact of inflationary adjustments in Argentina on a deferred tax position. These charges and gains are part of identified items, and compare with the full year 2023 which included net impairment charges and reversals of $642 million, and net charges of $295 million related to the impact of the weakening Argentine peso and strengthening Brazilian real on a deferred tax position.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items.

    Cash flow from operating activities for the full year 2024 was primarily driven by Adjusted EBITDA, partly offset by tax payments of $7,851 million and the timing impact of dividends (net of profits) from joint ventures and associates of $946 million.

    Total production, compared with the full year 2023, increased mainly due to new oil production, partly offset by field decline.

    1.All earnings amounts are shown post-tax, unless stated otherwise.

    2.Adjusted EBITDA is without taxation.

             Page 5

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                                                         
     
    MARKETING        
    Quarters $ million   Full year
    Q4 2024 Q3 2024 Q4 2023 %¹   Reference 2024 2023 %
    103    760    226    -86 Segment earnings2   1,894    3,058    -38
    (736)   (422)   (567)     Of which: Identified items2 A (1,991)   (254)    
    839    1,182    794    -29 Adjusted Earnings2 A 3,885    3,312    +17
    1,709    2,081    1,500    -18 Adjusted EBITDA2 A 7,476    6,337    +18
    1,363    2,722    1,767    -50 Cash flow from operating activities2 A 7,363    5,561    +32
    811    525    1,385      Cash capital expenditure2 C 2,445    5,790     
    2,795    2,945    2,997    -5 Marketing sales volumes (thousand b/d)2   2,843    3,045    -7

    1.Q4 on Q3 change

    2.Wholesale commercial fuels, previously reported in the Chemicals and Products segment, is reported in the Marketing segment (Mobility) with effect from Q1 2024. Comparative information for the Marketing segment and the Chemicals and Products segment has been revised.

    The Marketing segment comprises the Mobility, Lubricants, and Sectors and Decarbonisation businesses. The Mobility business operates Shell’s retail network including electric vehicle charging services and the Wholesale commercial fuels business which provides fuels for transport, industry and heating. The Lubricants business produces, markets and sells lubricants for road transport, and machinery used in manufacturing, mining, power generation, agriculture and construction. The Sectors and Decarbonisation business sells fuels, speciality products and services including low-carbon energy solutions to a broad range of commercial customers including the aviation, marine, and agricultural sectors.

    Quarter Analysis1

    Segment earnings, compared with the third quarter 2024, reflected lower Marketing margins (decrease of $395 million) mainly due to seasonal impact of lower volumes and lower Mobility unit margins as well as lower Sectors and Decarbonisation and Lubricants margins. These were partly offset by lower operating expenses (decrease of $118 million).

    Fourth quarter 2024 segment earnings also included impairment charges of $458 million, and net losses of $247 million related to sale of assets. These charges are part of identified items, and compare with the third quarter 2024 impairment charges of $179 million, charges of $98 million related to redundancy and restructuring, and net losses of $84 million related to sale of assets.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items.

    Cash flow from operating activities for the quarter was primarily driven by Adjusted EBITDA, working capital inflows of $845 million, and dividends (net of profits) from joint ventures and associates of $172 million. These inflows were partly offset by outflows relating to the timing impact of payments relating to emission certificates and biofuel programmes of $1,187 million and tax payments of $130 million.

    Marketing sales volumes (comprising hydrocarbon sales), compared with the third quarter 2024, decreased mainly due to seasonality.

    Full Year Analysis1

    Segment earnings, compared with the full year 2023, reflected higher Marketing margins (increase of $483 million) including higher unit margins in Lubricants and Mobility partly offset by lower Sectors and Decarbonisation margins. Segment earnings also reflected lower operating expenses (decrease of $449 million). These were partly offset by unfavourable tax movements ($157 million) and higher depreciation charges (increase of $142 million).

    Full year 2024 segment earnings also included impairment charges of $1,423 million mainly relating to an asset in the Netherlands, net losses of $386 million related to the sale of assets and charges of $215 million related to redundancy and restructuring. These charges are part of identified items and compare with the full year 2023 which included net impairment charges and reversals of $466 million, and charges of $113 million related to redundancy and restructuring partly offset by gains of $298 million related to indirect tax credits.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items.

    Cash flow from operating activities for the full year 2024 was primarily driven by Adjusted EBITDA, working capital inflows of $998 million, and dividends (net of profits) from joint ventures and associates of $262 million. These inflows

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    were partly offset by tax payments of $562 million, non-cash cost of supplies adjustment of $254 million, and outflows relating to the timing impact of payments relating to emission certificates and biofuel programmes of $221 million.

    Marketing sales volumes (comprising hydrocarbon sales), compared with the full year 2023, decreased mainly in Mobility including increased focus on value over volume.

    1.All earnings amounts are shown post-tax, unless stated otherwise.

    2.Adjusted EBITDA is without taxation.

             Page 7

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                                                         
     
    CHEMICALS AND PRODUCTS        
    Quarters $ million   Full year
    Q4 2024 Q3 2024 Q4 2023 %¹   Reference 2024 2023 %
    (328)   341    (1,828)   -196 Segment earnings2   1,757    1,482    +19
    (99)   (122)   (1,857)     Of which: Identified items2 A (1,177)   (2,135)    
    (229)   463    29    -150 Adjusted Earnings2 A 2,934    3,617    -19
    475    1,240    670    -62 Adjusted EBITDA2 A 6,783    7,489    -9
    2,032    3,321    1,150    -39 Cash flow from operating activities2 A 7,253    7,513    -3
    1,392    761    986      Cash capital expenditure2 C 3,290    3,013     
    1,215    1,305    1,315    -7 Refinery processing intake (thousand b/d)   1,344    1,349    —
    2,926    3,015    2,588    -3 Chemicals sales volumes (thousand tonnes)   11,875    11,245    +6

    1.Q4 on Q3 change

    2.Wholesale commercial fuels, previously reported in the Chemicals and Products segment, is reported in the Marketing segment (Mobility) with effect from Q1 2024. Comparative information for the Marketing segment and the Chemicals and Products segment has been revised.

    The Chemicals and Products segment includes chemicals manufacturing plants with their own marketing network, and refineries which turn crude oil and other feedstocks into a range of oil products which are moved and marketed around the world for domestic, industrial and transport use. The segment also includes the pipeline business, trading and optimisation of crude oil, oil products and petrochemicals, and Oil Sands activities (the extraction of bitumen from mined oil sands and its conversion into synthetic crude oil).

    Quarter Analysis1

    Segment earnings, compared with the third quarter 2024, reflected lower Products margins (decrease of $442 million) mainly driven by lower margins from trading and optimisation. Segment earnings also reflected lower Chemicals margins (decrease of $138 million) mainly due to lower realised prices. In addition, the fourth quarter 2024 reflected unfavourable tax movements ($67 million).

    Fourth quarter 2024 segment earnings also included net impairment charges and reversals of $224 million, partly offset by favourable deferred tax movements of $114 million. These charges and favourable movements are part of identified items, and compare with the third quarter 2024 which included charges of $101 million related to redundancy and restructuring, and net impairment charges and reversals of $92 million, partly offset by favourable movements of $95 million relating to an accounting mismatch due to fair value accounting of commodity derivatives. As part of Shell’s normal business, commodity derivative hedge contracts are entered into for mitigation of economic exposures on future purchases, sales and inventory.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items. In the fourth quarter 2024, Chemicals had negative Adjusted Earnings of $258 million and Products had positive Adjusted Earnings of $29 million.

    Cash flow from operating activities for the quarter was primarily driven by working capital inflows of $1,394 million, Adjusted EBITDA, net cash inflows relating to commodity derivatives of $230 million, dividends (net of profits) from joint ventures and associates of $139 million, and non-cash cost of supplies adjustment of $73 million. These inflows were partly offset by outflows relating to the timing impact of payments relating to emission certificates and biofuel programmes of $371 million.

    Chemicals manufacturing plant utilisation was 75% compared with 76% in the third quarter 2024.

    Refinery utilisation was 76% compared with 81% in the third quarter 2024, mainly due to higher planned maintenance.

    Full Year Analysis1

    Segment earnings, compared with the full year 2023, reflected lower Products margins (decrease of $1,832 million), mainly driven by lower refining margins, and unfavourable tax movements ($248 million). These were partly offset by lower operating expenses (decrease of $812 million) and higher Chemicals margins (increase of $602 million).

    Full year 2024 segment earnings also included net impairment charges and reversals of $1,176 million mainly relating to assets in Singapore, charges of $142 million related to redundancy and restructuring, and unfavourable movements of $86 million relating to an accounting mismatch due to fair value accounting of commodity derivatives, partly offset by favourable deferred tax movements of $114 million. These charges and movements are part of identified items, and compare with the full year 2023 which included net impairment charges and reversals of $2,195 million mainly relating to

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    the Chemicals assets in Singapore, and charges of $82 million related to redundancy and restructuring partly offset by favourable movements of $214 million relating to an accounting mismatch due to fair value accounting of commodity derivatives. As part of Shell’s normal business, commodity derivative hedge contracts are entered into for mitigation of economic exposures on future purchases, sales and inventory.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items. In the full year 2024, Chemicals had negative Adjusted Earnings of $432 million and Products had positive Adjusted Earnings of $3,366 million.

    Cash flow from operating activities for the full year 2024 was primarily driven by Adjusted EBITDA, working capital inflows of $524 million, dividends (net of profits) from joint ventures and associates of $304 million and net cash inflows relating to commodity derivatives of $219 million. These inflows were partly offset by cash outflows relating to legal provisions of $215 million, tax payments of $146 million, cash outflows relating to the timing impact of payments relating to emission certificates and biofuel programmes of $114 million, and non-cash cost of supplies adjustment of $109 million.

    Chemicals manufacturing plant utilisation was 76% compared with 68% in the full year 2023, mainly due to economic optimisation in the full year 2023. The increase was also driven by ramp-up of Shell Polymers Monaca and lower unplanned maintenance in the full year 2024.

    Refinery utilisation was 85% compared with 85% in the full year 2023.

    1.All earnings amounts are shown post-tax, unless stated otherwise.

    2.Adjusted EBITDA is without taxation.

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    RENEWABLES AND ENERGY SOLUTIONS        
    Quarters $ million   Full year
    Q4 2024 Q3 2024 Q4 2023 %¹   Reference 2024 2023 %
    (1,226)   (481)   (272)   -155 Segment earnings   (1,229)   3,089    -140
    (914)   (319)   (445)     Of which: Identified items A (732)   2,333     
    (311)   (162)   173    -92 Adjusted Earnings A (497)   756    -166
    (123)   (75)   253    -64 Adjusted EBITDA A (22)   1,481    -101
    850    (364)   (1,265)   +333 Cash flow from operating activities A 3,798    2,984    +27
    1,277    409    1,026      Cash capital expenditure C 2,549    2,681     
    76    79    68    -4 External power sales (terawatt hours)2   306    279    +10
    165    148    175    +11 Sales of pipeline gas to end-use customers (terawatt hours)3   652    738    -12

    1.Q4 on Q3 change

    2.Physical power sales to third parties; excluding financial trades and physical trade with brokers, investors, financial institutions, trading platforms, and wholesale traders.

    3.Physical natural gas sales to third parties; excluding financial trades and physical trade with brokers, investors, financial institutions, trading platforms, and wholesale traders. Excluding sales of natural gas by other segments and LNG sales.

    Renewables and Energy Solutions includes activities such as renewable power generation, the marketing and trading and optimisation of power and pipeline gas, as well as carbon credits, and digitally enabled customer solutions. It also includes the production and marketing of hydrogen, development of commercial carbon capture and storage hubs, investment in nature-based projects that avoid or reduce carbon emissions, and Shell Ventures, which invests in companies that work to accelerate the energy and mobility transformation.

    Quarter Analysis1

    Segment earnings, compared with the third quarter 2024, reflected unfavourable one-off tax movements ($107 million), and higher operating expenses (increase of $71 million).

    Fourth quarter 2024 segment earnings also included impairment charges of $996 million mainly relating to renewable generation assets in North America, partly offset by favourable movements of $50 million relating to an accounting mismatch due to fair value accounting of commodity derivatives. These charges and favourable movements are part of identified items and compare with the third quarter 2024 which included unfavourable movements of $279 million due to the fair value accounting of commodity derivatives. As part of Shell’s normal business, commodity derivative hedge contracts are entered into for mitigation of economic exposures on future purchases, sales and inventory.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items. Most Renewables and Energy Solutions activities were loss-making in the fourth quarter 2024.

    Cash flow from operating activities for the quarter was primarily driven by net cash inflows related to derivatives of $533 million, and working capital inflows of $353 million, partly offset by Adjusted EBITDA.

    Full Year Analysis1

    Segment earnings, compared with the full year 2023, reflected lower margins (decrease of $1,719 million) mainly from trading and optimisation primarily in Europe due to lower volatility, partly offset by lower operating expenses (decrease of $632 million).

    Full year 2024 segment earnings also included net impairment charges and reversals of $1,085 million mainly relating to renewable generation assets in North America, partly offset by favourable movements of $300 million relating to an accounting mismatch due to fair value accounting of commodity derivatives and a net gain on sale of assets of $94 million. These net charges and favourable movements are part of identified items and compare with the full year 2023 which included favourable movements of $2,756 million due to the fair value accounting of commodity derivatives partly offset by net impairment charges and reversals of $669 million. As part of Shell’s normal business, commodity derivative hedge contracts are entered into for mitigation of economic exposures on future purchases, sales and inventory.

    Adjusted Earnings and Adjusted EBITDA2 were driven by the same factors as the segment earnings and adjusted for identified items. Most Renewables and Energy Solutions activities were loss-making for the full year 2024, which was partly offset by positive Adjusted Earnings from trading and optimisation.

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    Cash flow from operating activities for the full year 2024 was primarily driven by net cash inflows related to derivatives of $3,012 million, and working capital inflows of $923 million, partly offset by tax payments of $457 million and Adjusted EBITDA.

    1.All earnings amounts are shown post-tax, unless stated otherwise.

    2.Adjusted EBITDA is without taxation.

    Additional Growth Measures

                                                         
    Quarters     Full year
    Q4 2024 Q3 2024 Q4 2023 %¹     2024 2023 %
            Renewable power generation capacity (gigawatt):        
    3.4    3.4    2.5    — – In operation2   3.4    2.5    +34
    4.0    3.9    4.1    +2 – Under construction and/or committed for sale3   4.0    4.1    -1

    1.Q4 on Q3 change

    2.Shell’s equity share of renewable generation capacity post commercial operation date. It excludes Shell’s equity share of associates where information cannot be obtained.

    3.Shell’s equity share of renewable generation capacity under construction and/or committed for sale under long-term offtake agreements (PPA). It excludes Shell’s equity share of associates where information cannot be obtained.

                                             
     
    CORPORATE      
    Quarters $ million   Full year
    Q4 2024 Q3 2024 Q4 2023   Reference 2024 2023
    (335)   (647)   (629)   Segment earnings1   (2,992)   (2,944)  
    45    (3)   (19)   Of which: Identified items A (1,024)   (69)  
    (380)   (643)   (609)   Adjusted Earnings1 A (1,968)   (2,875)  
    (24)   (346)   (544)   Adjusted EBITDA1 A (675)   (1,164)  
    16    115    1,540    Cash flow from operating activities A (1,882)   (832)  

    1.From the first quarter 2024, Shell’s longer-term innovation portfolio is managed centrally and hence reported as part of the Corporate segment (previously all other segments). Prior period comparatives have been revised to conform with current year presentation with an offsetting impact on all the other segments.

    The Corporate segment covers the non-operating activities supporting Shell. It comprises Shell’s holdings and treasury organisation, headquarters and central functions, self-insurance activities and centrally managed longer-term innovation portfolio. All finance expense, income and related taxes are included in Corporate segment earnings rather than in the earnings of business segments.

    Quarter Analysis1

    Segment earnings, compared with the third quarter 2024, reflected favourable tax movements and favourable currency exchange rate effects.

    Adjusted EBITDA2 was mainly driven by favourable currency exchange rate effects.

    Full Year Analysis1

    Segment earnings, compared with the full year 2023, were primarily driven by favourable tax movements, favourable net interest movements and favourable currency exchange rate effects.

    Full year 2024 segment earnings also included reclassifications from equity to profit and loss of cumulative currency translation differences related to funding structures resulting in unfavourable movements of $1,122 million. These reclassifications are included in identified items.

    Adjusted EBITDA2 was mainly driven by favourable currency exchange rate effects and lower operating expenses.

    1.All earnings amounts are shown post-tax, unless stated otherwise.

    2.Adjusted EBITDA is without taxation.

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    PRELIMINARY RESERVES UPDATE

    When final volumes are reported in the 2024 Annual Report and Accounts and 2024 Form 20-F, Shell expects that SEC proved oil and gas reserves additions before taking into account production will be approximately 0.9 billion boe, and that 2024 production will be approximately 1.1 billion boe. As a result, total proved reserves on an SEC basis are expected to be approximately 9.6 billion boe1, 2, 3. Acquisitions and divestments of 2024 reserves are expected to account for a net increase of approximately 0.05 billion boe.

    The proved Reserves Replacement Ratio on an SEC basis is expected to be 85% for the year (106% without debooking Groundbirch because of the low average AECO price in 2024) and 108% for the 3-year average. Excluding the impact of acquisitions and divestments, the proved Reserves Replacement Ratio is expected to be 80% (102% without debooking Groundbirch) for the year and 68% for the 3-year average.

    Further information will be provided in the 2024 Annual Report and Accounts and 2024 Form 20-F.

    1.Pursuant to our 2017 agreement with Canadian Natural Resources Limited, our remaining mining interest and associated synthetic crude oil reserves will be swapped for an additional 10% interest in the Scotford upgrader and Quest CCS project. The transaction is expected to close by the end of the first quarter 2025, subject to regulatory approvals. The associated proved reserves at December 31, 2024 are 0.7 billion barrels (of which 50% attributable to non-controlling interest).

    2.On January 16, 2024, we announced an agreement to sell our Nigerian onshore subsidiary The Shell Petroleum Development Company of Nigeria Limited (SPDC) which holds a 30% interest in the SPDC JV to Renaissance, subject to various conditions. As of December 31, 2024, we had proved reserves of 0.5 billion boe in SPDC.

    3.In December 2024, we, along with Equinor ASA, announced the combination of our UK offshore oil and gas assets and expertise to form a new company which will be the UK North Sea’s biggest independent producer. On deal completion, the new independent producer will be jointly owned by Equinor (50%) and Shell (50%) and 0.16 billion boe (as of December 31, 2024) of Shell’s proved reserves will be contributed to the new joint venture alongside proved reserves contributed by Equinor. Subsequently, Shell will report 50% of the proved reserves of the new joint venture as part of Shell’s share of proved reserves from joint ventures and associates.

             Page 12

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    OUTLOOK FOR THE FIRST QUARTER 2025

    Full year 2024 cash capital expenditure was $21 billion. Our cash capital expenditure range for the full year 2025 is expected to be lower than our 2024 range, with more guidance to come at the Capital Markets Day 2025.

    Integrated Gas production is expected to be approximately 930 – 990 thousand boe/d. First quarter 2025 outlook reflects Pearl GTL back in operation after a major turnaround. LNG liquefaction volumes are expected to be approximately 6.6 – 7.2 million tonnes.

    Upstream production is expected to be approximately 1,750 – 1,950 thousand boe/d.

    Marketing sales volumes are expected to be approximately 2,500 – 3,000 thousand b/d.

    Refinery utilisation is expected to be approximately 80% – 88%. Chemicals manufacturing plant utilisation is expected to be approximately 78% – 86%.

    Corporate Adjusted Earnings were a net expense of $380 million1 for the fourth quarter 2024. Corporate Adjusted Earnings2 are expected to be a net expense of approximately $400 – $600 million in the first quarter 2025.

    1.From the first quarter 2024, Shell’s longer-term innovation portfolio is managed centrally and hence reported as part of the Corporate segment (previously all other segments). Prior period comparatives have been revised to conform with current year presentation with an offsetting impact on all the other segments.

    2.For the definition of Adjusted Earnings and the most comparable GAAP measure please see reference A.

    FORTHCOMING EVENTS

               
     
    Date Event
    February 25, 2025 Shell LNG Outlook 2025 publication
       
    March 25, 2025 Publication of Annual Report and Accounts and filing of Form 20-F for the year ended December 31, 2024
    March 25, 2025 Capital Markets Day 2025
    May 2, 2025 First quarter 2025 results and dividends
    May 20, 2025 Annual General Meeting
    July 31, 2025 Second quarter 2025 results and dividends
    October 30, 2025 Third quarter 2025 results and dividends

             Page 13

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                                       
     
    CONSOLIDATED STATEMENT OF INCOME    
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    66,281    71,089    78,732    Revenue1 284,312    316,620   
    (156)   933    768    Share of profit/(loss) of joint ventures and associates 2,993    3,725   
    683    440    631    Interest and other income/(expenses)2 1,724    2,838   
    66,807    72,462    80,131    Total revenue and other income/(expenses) 289,029    323,183   
    43,610    48,225    54,745    Purchases 188,120    212,883   
    5,839    6,138    6,807    Production and manufacturing expenses 23,379    25,240   
    3,231    3,139    3,621    Selling, distribution and administrative expenses 12,439    13,433   
    331    294    469    Research and development 1,099    1,287   
    861    305    467    Exploration 2,411    1,750   
    7,520    5,916    11,221    Depreciation, depletion and amortisation2 26,872    31,290   
    1,213    1,174    1,166    Interest expense 4,787    4,673   
    62,605    65,190    78,496    Total expenditure 259,107    290,556   
    4,205    7,270    1,635    Income/(loss) before taxation 29,922    32,627   
    3,164    2,879    1,099    Taxation charge/(credit)2 13,401    12,991   
    1,041    4,391    536    Income/(loss) for the period 16,521    19,636   
    113    100    62    Income/(loss) attributable to non-controlling interest 427    277   
    928    4,291    474    Income/(loss) attributable to Shell plc shareholders 16,093    19,359   
    0.15    0.69    0.07    Basic earnings per share ($)3 2.55    2.88   
    0.15    0.68    0.07    Diluted earnings per share ($)3 2.53    2.85   

    1.See Note 2 “Segment information”.

    2.See Note 8 “Other notes to the unaudited Condensed Consolidated Financial Statements”.

    3.See Note 4 “Earnings per share”.

                                       
     
    CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME    
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    1,041    4,391    536    Income/(loss) for the period 16,521    19,636   
          Other comprehensive income/(loss) net of tax:    
          Items that may be reclassified to income in later periods:    
    (4,899)   2,947    2,571    – Currency translation differences1 (3,248)   1,397   
    (11)   35    29    – Debt instruments remeasurements 5    41   
    224    (75)   11    – Cash flow hedging gains/(losses) 216    71   
    —    —    —    – Net investment hedging gains/(losses) —    (44)  
    (50)   (2)   (53)   – Deferred cost of hedging (73)   (148)  
    (91)   35    135    – Share of other comprehensive income/(loss) of joint ventures and associates (118)   18   
    (4,827)   2,940    2,692    Total (3,217)   1,335   
          Items that are not reclassified to income in later periods:    
    239    419    (1,207)   – Retirement benefits remeasurements 1,407    (1,083)  
    (50)   80    (84)   – Equity instruments remeasurements 28    (99)  
    46    (53)   (186)   – Share of other comprehensive income/(loss) of joint ventures and associates 47    (201)  
    235    446    (1,477)   Total 1,482    (1,383)  
    (4,592)   3,386    1,215    Other comprehensive income/(loss) for the period (1,735)   (48)  
    (3,552)   7,777    1,750    Comprehensive income/(loss) for the period 14,786    19,588   
    50    177    96    Comprehensive income/(loss) attributable to non-controlling interest 407    312   
    (3,602)   7,600    1,654    Comprehensive income/(loss) attributable to Shell plc shareholders 14,379    19,276   

    1.See Note 8 “Other notes to the unaudited Condensed Consolidated Financial Statements”.

             Page 14

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                     
     
    CONDENSED CONSOLIDATED BALANCE SHEET
    $ million    
      December 31, 2024 December 31, 2023
    Assets    
    Non-current assets    
    Goodwill 16,032    16,660   
    Other intangible assets 9,480    10,253   
    Property, plant and equipment 185,219    194,835   
    Joint ventures and associates 23,445    24,457   
    Investments in securities 2,255    3,246   
    Deferred tax 6,857    6,454   
    Retirement benefits1 10,003    9,151   
    Trade and other receivables 6,018    6,298   
    Derivative financial instruments² 374    801   
      259,681    272,155   
    Current assets    
    Inventories 23,426    26,019   
    Trade and other receivables 45,860    53,273   
    Derivative financial instruments² 9,673    15,098   
    Cash and cash equivalents 39,110    38,774   
      118,069    133,164   
    Assets classified as held for sale1 9,857    951   
      127,926    134,115   
    Total assets 387,607    406,270   
    Liabilities    
    Non-current liabilities    
    Debt 65,448    71,610   
    Trade and other payables 3,290    3,103   
    Derivative financial instruments² 2,185    2,301   
    Deferred tax 13,505    15,347   
    Retirement benefits1 6,752    7,549   
    Decommissioning and other provisions 21,227    22,531   
      112,408    122,441   
    Current liabilities    
    Debt 11,630    9,931   
    Trade and other payables 60,693    68,237   
    Derivative financial instruments² 7,391    9,529   
    Income taxes payable 4,648    3,422   
    Decommissioning and other provisions 4,469    4,041   
      88,831    95,160   
    Liabilities directly associated with assets classified as held for sale1 6,203    307   
      95,034    95,467   
    Total liabilities 207,442    217,908   
    Equity attributable to Shell plc shareholders 178,303    186,607   
    Non-controlling interest 1,861    1,755   
    Total equity 180,165    188,362   
    Total liabilities and equity 387,607    406,270   

    1.    See Note 8 “Other notes to the unaudited Condensed Consolidated Financial Statements”.

    2.    See Note 7 “Derivative financial instruments and debt excluding lease liabilities”.

             Page 15

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    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                                                         
     
    CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
      Equity attributable to Shell plc shareholders      
    $ million Share capital1 Shares held in trust Other reserves² Retained earnings Total Non-controlling interest   Total equity
    At January 1, 2024 544    (997)   21,145    165,915    186,607    1,755      188,362   
    Comprehensive income/(loss) for the period —    —    (1,715)   16,093    14,378    407      14,785   
    Transfer from other comprehensive income —    —    193    (193)   —    —      —   
    Dividends³ —    —    —    (8,669)   (8,669)   (308)     (8,976)  
    Repurchases of shares4 (34)   —    34    (14,057)   (14,057)   —      (14,057)  
    Share-based compensation —    194    109    (354)   (52)   —      (52)  
    Other changes —    —    —    96    96    7      103   
    At December 31, 2024 510    (804)   19,766    158,832    178,303    1,861      180,165   
    At January 1, 2023 584    (726)   21,132    169,482    190,472    2,125      192,597   
    Comprehensive income/(loss) for the period —    —    (83)   19,359    19,276    312      19,588   
    Transfer from other comprehensive income —    —    (112)   112    —    —      —   
    Dividends3 —    —    —    (8,389)   (8,389)   (764)     (9,153)  
    Repurchases of shares4 (40)   —    40    (14,571)   (14,571)   —      (14,571)  
    Share-based compensation —    (271)   168    (85)   (188)   —      (188)  
    Other changes —    —    —    7    7    82      89   
    At December 31, 2023 544    (997)   21,145    165,915    186,607    1,755      188,362   

    1.    See Note 5 “Share capital”.

    2.    See Note 6 “Other reserves”.

    3.    The amount charged to retained earnings is based on prevailing exchange rates on payment date.

    4.     Includes shares committed to repurchase under an irrevocable contract and repurchases subject to settlement at the end of the quarter.

             Page 16

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                                             
     
    CONSOLIDATED STATEMENT OF CASH FLOWS    
    Quarters $ million Full year
    Q4 2024   Q3 2024 Q4 2023   2024 2023
    4,205      7,270    1,635    Income before taxation for the period 29,922    32,627   
            Adjustment for:    
    665      554    571    – Interest expense (net) 2,415    2,360   
    7,520      5,916    11,221    – Depreciation, depletion and amortisation1 26,872    31,290   
    649      150    243    – Exploration well write-offs 1,622    868   
    288      154    (222)   – Net (gains)/losses on sale and revaluation of non-current assets and businesses 288    (246)  
    156      (933)   (768)   – Share of (profit)/loss of joint ventures and associates (2,993)   (3,725)  
    1,241      860    1,145    – Dividends received from joint ventures and associates 3,632    3,674   
    131      2,705    4,088    – (Increase)/decrease in inventories 1,273    6,325   
    751      4,057    (704)   – (Increase)/decrease in current receivables 6,578    12,401   
    1,524      (4,096)   (701)   – Increase/(decrease) in current payables2 (5,789)   (11,581)  
    111      735    328    – Derivative financial instruments 2,484    (5,723)  
    (58)     125    (68)   – Retirement benefits (326)   (37)  
    (256)     359    430    – Decommissioning and other provisions2 (828)   220   
    (856)     (144)   (1,021)   – Other1 1,536    (550)  
    (2,910)     (3,028)   (3,604)   Tax paid (12,002)   (13,712)  
    13,162      14,684    12,575    Cash flow from operating activities 54,684    54,191   
    (6,486)     (4,690)   (6,960)      Capital expenditure (19,601)   (22,993)  
    (421)     (222)   (109)      Investments in joint ventures and associates (1,404)   (1,202)  
    (17)     (38)   (44)      Investments in equity securities (80)   (197)  
    (6,924)     (4,950)   (7,113)   Cash capital expenditure (21,084)   (24,392)  
    493      94    540    Proceeds from sale of property, plant and equipment and businesses 1,621    2,565   
    305      94    49    Proceeds from joint ventures and associates from sale, capital reduction and repayment of long-term loans 590    474   
    6      6    24    Proceeds from sale of equity securities 582    51   
    581      593    568    Interest received 2,399    2,124   
    1,762      1,074    960    Other investing cash inflows1 4,576    4,269   
    (655)     (769)   (685)   Other investing cash outflows (3,838)   (2,825)  
    (4,431)     (3,857)   (5,657)   Cash flow from investing activities (15,154)   (17,734)  
    65      (89)   (27)   Net increase/(decrease) in debt with maturity period within three months (310)   (211)  
            Other debt:    
    (13)     78    64    – New borrowings 363    1,029   
    (2,664)     (1,322)   (4,054)   – Repayments (9,672)   (10,650)  
    (1,379)     (979)   (1,366)   Interest paid (4,557)   (4,441)  
    (833)     652    702    Derivative financial instruments (594)   723   
    (10)     —    (1)   Change in non-controlling interest (15)   (22)  
            Cash dividends paid to:    
    (2,114)     (2,167)   (2,201)   – Shell plc shareholders (8,668)   (8,393)  
    (53)     (92)   (128)   – Non-controlling interest (295)   (764)  
    (3,579)     (3,537)   (3,977)   Repurchases of shares (13,898)   (14,617)  
    (309)     6    (714)   Shares held in trust: net sales/(purchases) and dividends received (789)   (889)  
    (10,889)     (7,452)   (11,703)   Cash flow from financing activities (38,434)   (38,235)  
    (985)     729    529    Effects of exchange rate changes on cash and cash equivalents (761)   306   
    (3,142)     4,105    (4,256)   Increase/(decrease) in cash and cash equivalents 336    (1,472)  
    42,252      38,148    43,031    Cash and cash equivalents at beginning of period 38,774    40,246   
    39,110      42,252    38,774    Cash and cash equivalents at end of period 39,110    38,774   

    1.See Note 8 “Other notes to the unaudited Condensed Consolidated Financial Statements”.

    2.To further enhance consistency between working capital and the Balance Sheet and the Statement of Cash Flows, from January 1, 2024, onwards movements in current other provisions are recognised in ‘Decommissioning and other provisions’ instead of ‘Increase/(decrease) in current payables’. Comparatives for the fourth quarter 2023 and the full year 2023 have been reclassified accordingly by $653 million and $693 million respectively to conform with current period presentation.

             Page 17

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

    1. Basis of preparation

    These unaudited Condensed Consolidated Financial Statements of Shell plc (“the Company”) and its subsidiaries (collectively referred to as “Shell”) have been prepared on the basis of the same accounting principles as those used in the Company’s Annual Report and Accounts (pages 244 to 316) for the year ended December 31, 2023, as filed with the Registrar of Companies for England and Wales and as filed with the Autoriteit Financiële Markten (the Netherlands) and Form 20-F (pages 217 to 290) for the year ended December 31, 2023, as filed with the US Securities and Exchange Commission, and should be read in conjunction with these filings.

    The financial information presented in the unaudited Condensed Consolidated Financial Statements does not constitute statutory accounts within the meaning of section 434(3) of the Companies Act 2006 (“the Act”). Statutory accounts for the year ended December 31, 2023, were published in Shell’s Annual Report and Accounts, a copy of which was delivered to the Registrar of Companies for England and Wales, and in Shell’s Form 20-F. The auditor’s report on those accounts was unqualified, did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report and did not contain a statement under sections 498(2) or 498(3) of the Act. The statutory accounts for the year ended December 31, 2024, will be delivered to the Registrar of Companies for England and Wales in due course.

    2. Segment information

    Segment earnings are presented on a current cost of supplies basis (CCS earnings), which is the earnings measure used by the Chief Executive Officer for the purposes of making decisions about allocating resources and assessing performance. On this basis, the purchase price of volumes sold during the period is based on the current cost of supplies during the same period after making allowance for the tax effect. CCS earnings therefore exclude the effect of changes in the oil price on inventory carrying amounts. Sales between segments are based on prices generally equivalent to commercially available prices.

    From the first quarter 2024, Wholesale commercial fuels forms part of Mobility with inclusion in the Marketing segment (previously Chemicals and Products segment). The change in segmentation reflects the increasing alignment between the economic characteristics of Wholesale commercial fuels and other Mobility businesses, and is consistent with changes in the information provided to the Chief Operating Decision Maker. Prior period comparatives have been revised to conform with current year presentation with an offsetting impact between the Marketing and the Chemicals and Products segment (see below). Also, from the first quarter 2024, Shell’s longer-term innovation portfolio is managed centrally and hence reported as part of the Corporate segment (previously all other segments). Prior period comparatives have been revised to conform with current year presentation with an offsetting impact on all the other segments (see below).

             Page 18

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                                       
     
    REVENUE AND CCS EARNINGS BY SEGMENT    
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
          Third-party revenue    
    9,294    9,748    10,437    Integrated Gas 37,290    37,645   
    1,652    1,605    1,263    Upstream 6,606    6,475   
    27,524    30,519    31,761    Marketing2 120,088    130,560   
    19,992    22,608    24,957    Chemicals and Products2 90,918    97,079   
    7,808    6,599    10,302    Renewables and Energy Solutions 29,366    44,819   
    10    10    11    Corporate 43    42   
    66,281    71,089    78,732    Total third-party revenue1 284,312    316,620   
          Inter-segment revenue    
    2,024    2,131    2,614    Integrated Gas 8,715    11,560   
    9,931    9,618    10,948    Upstream 39,939    41,230   
    984    1,235    1,243    Marketing2 4,937    5,299   
    8,656    9,564    10,163    Chemicals and Products2 38,381    42,816   
    1,879    1,131    1,567    Renewables and Energy Solutions 4,971    4,707   
    —    —    —    Corporate —    —   
          CCS earnings    
    1,744    2,631    1,733    Integrated Gas 9,590    7,058   
    1,031    2,289    2,151    Upstream 7,772    8,539   
    103    760    226    Marketing2 1,894    3,058   
    (328)   341    (1,828)   Chemicals and Products2 1,757    1,482   
    (1,226)   (481)   (272)   Renewables and Energy Solutions (1,229)   3,089   
    (335)   (647)   (629)   Corporate3 (2,992)   (2,944)  
    989    4,894    1,381    Total CCS earnings4 16,792    20,281   

    1.Includes revenue from sources other than from contracts with customers, which mainly comprises the impact of fair value accounting of commodity derivatives.

    2.From January 1, 2024, onwards Wholesale commercial fuels has been reallocated from the Chemicals and Products segment to the Marketing segment. Comparatives for the fourth quarter 2023 and the full year 2023 have been reclassified accordingly, by $5,332 million and $21,702 million respectively for Third-party revenue and by $82 million and $104 million respectively for CCS earnings to conform with current period presentation. For Inter-segment revenue the reallocation and revision of comparative figures for the fourth quarter 2023 and the full year 2023 led to an increase in inter-segment revenue in the Marketing segment of $1,058 million and $4,675 million respectively and an increase in the Chemicals and Products segment of $9,553 million and $40,564 million respectively.

    3.From January 1, 2024, onwards costs for Shell’s centrally managed longer-term innovation portfolio are reported as part of the Corporate segment. Prior period comparatives for Corporate for the fourth quarter 2023 and the full year 2023 have been revised by $43 million and $133 million respectively, with a net offsetting impact in all other segments to conform with current period presentation.

    4.See Note 3 “Reconciliation of income for the period to CCS Earnings, Operating expenses and Total Debt”.

             Page 19

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    Cash capital expenditure is a measure used by the Chief Executive Officer for the purposes of making decisions about allocating resources and assessing performance.

                                       
     
    CASH CAPITAL EXPENDITURE BY SEGMENT
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
          Capital expenditure    
    1,123    1,090    1,034    Integrated Gas 4,095    3,491   
    2,205    1,998    2,547    Upstream 7,738    8,249   
    798    488    1,383    Marketing1 2,357    5,741   
    1,121    748    983    Chemicals and Products1 2,943    2,928   
    1,214    327    932    Renewables and Energy Solutions 2,338    2,314   
    25    39    81    Corporate 129    270   
    6,486    4,690    6,960    Total capital expenditure 19,601    22,993   
          Add: Investments in joint ventures and associates    
    214    147    162    Integrated Gas 671    705   
    (117)   (37)   (111)   Upstream 150    94   
    13    37    2    Marketing 88    49   
    271    13    2    Chemicals and Products 347    84   
    36    59    56    Renewables and Energy Solutions 138    261   
    4    3    (2)   Corporate 9    9   
    421    222    109    Total investments in joint ventures and associates 1,404    1,202   
          Add: Investments in equity securities    
    —    —    —    Integrated Gas —    —   
    (11)   12    —    Upstream 1    —   
    —    —    —    Marketing —    —   
    —    —    —    Chemicals and Products —    2   
    28    23    38    Renewables and Energy Solutions 73    106   
    —    3    6    Corporate 6    89   
    17    38    44    Total investments in equity securities 80    197   
          Cash capital expenditure    
    1,337    1,236    1,196    Integrated Gas 4,766    4,196   
    2,076    1,974    2,436    Upstream 7,890    8,343   
    811    525    1,385    Marketing1 2,445    5,790   
    1,392    761    986    Chemicals and Products1 3,290    3,013   
    1,277    409    1,026    Renewables and Energy Solutions 2,549    2,681   
    30    45    85    Corporate 144    368   
    6,924    4,950    7,113    Total Cash capital expenditure 21,084    24,392   

    1.From January 1, 2024, onwards Wholesale commercial fuels has been reallocated from the Chemicals and Products segment to the Marketing segment. Comparatives for the fourth quarter 2023 and the full year 2023 have been reclassified accordingly by $46 million and $178 million respectively for capital expenditure and cash capital expenditure to conform with current period presentation.

             Page 20

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    3. Reconciliation of income for the period to CCS Earnings, Operating expenses and Total Debt

                                       
     
    RECONCILIATION OF INCOME FOR THE PERIOD TO CCS EARNINGS    
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    928    4,291    474    Income/(loss) attributable to Shell plc shareholders 16,093    19,359   
    113    100    62    Income/(loss) attributable to non-controlling interest 427    277   
    1,041    4,391    536    Income/(loss) for the period 16,521    19,636   
          Current cost of supplies adjustment:    
    (84)   668    1,089    Purchases 389    815   
    23    (162)   (263)   Taxation (91)   (203)  
    9    (2)   19    Share of profit/(loss) of joint ventures and associates (26)   33   
    (52)   503    846    Current cost of supplies adjustment 272    645   
          Of which:    
    (45)   477    811    Attributable to Shell plc shareholders 257    650
    (7)   26    34    Attributable to non-controlling interest 14    (5)
    989    4,894    1,381    CCS earnings 16,792    20,281   
          Of which:    
    883    4,768    1,285    CCS earnings attributable to Shell plc shareholders 16,351    20,008   
    106    126    97    CCS earnings attributable to non-controlling interest 442    273   
                                       
     
    RECONCILIATION OF OPERATING EXPENSES    
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    5,839    6,138    6,807    Production and manufacturing expenses 23,379    25,240   
    3,231    3,139    3,621    Selling, distribution and administrative expenses 12,439    13,433   
    331    294    469    Research and development 1,099    1,287   
    9,401    9,570    10,897    Operating expenses 36,918    39,960   
                                       
     
    RECONCILIATION OF TOTAL DEBT    
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    December 31, 2024 September 30, 2024 December 31, 2023   December 31, 2024 December 31, 2023
    11,630    12,015    9,931    Current debt 11,630    9,931   
    65,448    64,597    71,610    Non-current debt 65,448    71,610   
    77,078    76,613    81,541    Total debt 77,078    81,541   

    4. Earnings per share

                                       
     
    EARNINGS PER SHARE
    Quarters   Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    928    4,291    474    Income/(loss) attributable to Shell plc shareholders ($ million) 16,093    19,359   
               
          Weighted average number of shares used as the basis for determining:    
    6,148.4    6,256.5    6,558.3    Basic earnings per share (million) 6,299.6    6,733.5   
    6,213.9    6,320.9    6,631.1    Diluted earnings per share (million) 6,363.7    6,799.8   

             Page 21

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    5. Share capital

                             
     
    ISSUED AND FULLY PAID ORDINARY SHARES OF €0.07 EACH
      Number of shares   Nominal value
    ($ million)
    At January 1, 2024 6,524,109,049      544     
    Repurchases of shares (409,077,891)     (34)    
    At December 31, 2024 6,115,031,158      510     
    At January 1, 2023 7,003,503,393      584     
    Repurchases of shares (479,394,344)     (40)    
    At December 31, 2023 6,524,109,049      544     

    At Shell plc’s Annual General Meeting on May 21, 2024, the Board was authorised to allot ordinary shares in Shell plc, and to grant rights to subscribe for, or to convert, any security into ordinary shares in Shell plc, up to an aggregate nominal amount of approximately €150 million (representing approximately 2,147 million ordinary shares of €0.07 each), and to list such shares or rights on any stock exchange. This authority expires at the earlier of the close of business on August 20, 2025, or the end of the Annual General Meeting to be held in 2025, unless previously renewed, revoked or varied by Shell plc in a general meeting.

    6. Other reserves

                                             
     
    OTHER RESERVES
    $ million Merger reserve Share premium reserve Capital redemption reserve Share plan reserve Accumulated other comprehensive income Total
    At January 1, 2024 37,298    154    236    1,308    (17,851)   21,145   
    Other comprehensive income/(loss) attributable to Shell plc shareholders —    —    —    —    (1,715)   (1,715)  
    Transfer from other comprehensive income —    —    —    —    193    193   
    Repurchases of shares —    —    34    —    —    34   
    Share-based compensation —    —    —    109    —    109   
    At December 31, 2024 37,298    154    270    1,416    (19,373)   19,766   
    At January 1, 2023 37,298    154    196    1,140    (17,656)   21,132   
    Other comprehensive income/(loss) attributable to Shell plc shareholders —    —    —    —    (83)   (83)  
    Transfer from other comprehensive income —    —    —    —    (112)   (112)  
    Repurchases of shares —    —    40    —    —    40   
    Share-based compensation —    —    —    168    —    168   
    At December 31, 2023 37,298    154    236    1,308    (17,851)   21,145   

    The merger reserve and share premium reserve were established as a consequence of Shell plc (formerly Royal Dutch Shell plc) becoming the single parent company of Royal Dutch Petroleum Company and The “Shell” Transport and Trading Company, p.l.c., now The Shell Transport and Trading Company Limited, in 2005. The merger reserve increased in 2016 following the issuance of shares for the acquisition of BG Group plc. The capital redemption reserve was established in connection with repurchases of shares of Shell plc. The share plan reserve is in respect of equity-settled share-based compensation plans.

    7. Derivative financial instruments and debt excluding lease liabilities

    As disclosed in the Consolidated Financial Statements for the year ended December 31, 2023, presented in the Annual Report and Accounts and Form 20-F for that year, Shell is exposed to the risks of changes in fair value of its financial assets and liabilities. The fair values of the financial assets and liabilities are defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Methods and assumptions used to estimate the fair values at December 31, 2024, are consistent with those used in the year ended December 31, 2023, though the carrying amounts of derivative financial instruments have changed since that

             Page 22

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    date. The movement of the derivative financial instruments between December 31, 2023 and December 31, 2024 is a decrease of $5,425 million for the current assets and a decrease of $2,138 million for the current liabilities.

    The table below provides the comparison of the fair value with the carrying amount of debt excluding lease liabilities, disclosed in accordance with IFRS 7 Financial Instruments: Disclosures.

                     
     
    DEBT EXCLUDING LEASE LIABILITIES
    $ million December 31, 2024 December 31, 2023
    Carrying amount1 48,376    53,832   
    Fair value2 44,119    50,866   

    1.    Shell issued no debt under the US shelf or under the Euro medium-term note programmes during the year 2024.

    2.     Mainly determined from the prices quoted for these securities.

    8. Other notes to the unaudited Condensed Consolidated Financial Statements

    Consolidated Statement of Income

    Interest and other income

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    683    440    631    Interest and other income/(expenses) 1,724    2,838   
          Of which:    
    548    619    595    Interest income 2,372    2,313   
    25    4    14    Dividend income (from investments in equity securities) 83    49   
    (288)   (154)   222    Net gains/(losses) on sales and revaluation of non-current assets and businesses (288)   257   
    267    (189)   (398)   Net foreign exchange gains/(losses) on financing activities (1,025)   (458)  
    131    159    199    Other 582    677   

    Depreciation, depletion and amortisation

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    7,520    5,916    11,221    Depreciation, depletion and amortisation 26,872    31,290   
          Of which:    
    5,829 5,578 5,986 Depreciation 22,703    23,106   
    1,797 340 5,508 Impairments 4,502    8,947   
    (106) (2) (273) Impairment reversals (333)   (762)  

    Impairments recognised in the fourth quarter 2024 of $2,659 million pre-tax ($2,245 million post-tax), of which $1,797 million recognised in depreciation, depletion and amortisation and $863 million recognised in share of profit of joint ventures and associates, mainly relate to Renewables and Energy Solutions ($1,068 million pre-tax; $1,000 million post-tax), Integrated Gas ($532 million pre-tax; $345 million post-tax), Marketing ($495 million pre-tax; $459 million post-tax), Chemicals and Products ($315 million pre-tax; $247 million post-tax) and Upstream ($248 million pre-tax; $194 million post-tax). The impairment in Renewables and Energy Solutions was principally triggered by a portfolio choice regarding renewable generation assets in North America. The impairments in other segments relate to various smaller impairments.

    Impairments recognised in the third quarter 2024 of $340 million pre-tax ($290 million post-tax) mainly relate to various

    assets in Marketing and Chemicals and Products.

    Impairments recognised in the fourth quarter 2023 of $5,508 million pre-tax ($4,044 million post-tax) relate to various

    assets in Chemicals and Products ($2,490 million), Upstream ($1,161 million), Integrated Gas ($873 million), Renewables

    and Energy Solutions ($614 million) and Marketing ($370 million).

             Page 23

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    Taxation charge/credit

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    3,164    2,879    1,099    Taxation charge/(credit) 13,401    12,991   
          Of which:    
    3,125 2,834 1,099 Income tax excluding Pillar Two income tax 13,150    12,991   
    39 45 — Income tax related to Pillar Two income tax 251    —

    On June 20, 2023, the UK substantively enacted Pillar Two Model Rules, effective as from January 1, 2024.

    As required by IAS 12 Income Taxes, Shell has applied the exception to recognising and disclosing information about deferred tax assets and liabilities related to Pillar Two income taxes.

    Consolidated Statement of Comprehensive Income

    Currency translation differences

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    (4,899)   2,947    2,571    Currency translation differences (3,248)   1,397   
          Of which:    
    (5,028) 2,912 2,578 Recognised in Other comprehensive income (4,504)   1,396   
    129 35 (7) (Gain)/loss reclassified to profit or loss 1,256    1

    Condensed Consolidated Balance Sheet

    Retirement benefits

                     
     
    $ million    
      December 31, 2024 December 31, 2023
    Non-current assets    
    Retirement benefits 10,003    9,151   
    Non-current liabilities    
    Retirement benefits 6,752    7,549   
    Surplus/(deficit) 3,251    1,602   

    Amounts recognised in the Balance Sheet in relation to defined benefit plans include both plan assets and obligations that are presented on a net basis on a plan-by-plan basis. The change in the net retirement benefit asset as at December 31, 2024, is mainly driven by an increase of the market yield on high-quality corporate bonds in the USA, the UK and Eurozone since December 31, 2023, partly offset by losses on plan assets.

    Assets classified as held for sale

                       
       
    $ million      
      December 31, 2024 December 31, 2023  
    Assets classified as held for sale 9,857    951     
    Liabilities directly associated with assets classified as held for sale 6,203    307     

    Assets classified as held for sale and associated liabilities at December 31, 2024 principally relate to Shell’s UK offshore oil and gas assets in Upstream, mining interests in Canada in Chemicals and Products and an energy and chemicals park in Chemicals and Products in Singapore. Upon completion of the sale, Shell’s UK offshore assets will be derecognised in exchange for a 50% interest in a newly formed joint venture.

    The major classes of assets and liabilities classified as held for sale at December 31, 2024, are Property, plant and equipment ($8,283 million; December 31, 2023: $250 million), Inventories ($1,180 million; December 31, 2023:

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    $463 million), Decommissioning and other provisions ($3,053 million; December 31, 2023: $75 million), deferred tax liabilities ($2,042 million; December 31, 2023: nil) and Debt ($624 million; December 31, 2023: $84 million).

    Consolidated Statement of Cash Flows

    Cash flow from operating activities – Other

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    (856)   (144)   (1,021)   Other 1,536    (550)  

    ‘Cash flow from operating activities – Other’ for the fourth quarter 2024 includes $1,447 million of net outflows (third quarter 2024: $432 million net inflows; fourth quarter 2023: $875 million net outflows) due to the timing of payments relating to emission certificates and biofuel programmes in Europe and North America and $672 million in relation to reversal of currency exchange losses on Cash and cash equivalents (third quarter 2024: $539 million gains; fourth quarter 2023: $398 million gains).

    Cash flow from investing activities – Other investing cash inflows

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    1,762    1,074    960    Other investing cash inflows 4,576    4,269   

    ‘Cash flow from investing activities – Other investing cash inflows’ for the fourth quarter 2024 mainly relates to the sale of pension-related debt securities and repayments of short-term loans.

    9. Post-balance sheet events

    On January 23, 2025, Shell announced changes to the Executive Committee. In line with the company’s ongoing transformation, Shell will continue to evolve its structure to enable Shell’s strategy to deliver more value with less emissions. As a result, Trading and Supply will move up to the Executive Committee and out of the Downstream, Renewables and Energy Solutions directorate with effect from April 1, 2025. These changes will not affect Shell’s financial reporting segments.

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    ALTERNATIVE PERFORMANCE (NON-GAAP) MEASURES

    A.Adjusted Earnings, Adjusted earnings before interest, taxes, depreciation and amortisation (“Adjusted EBITDA”) and Cash flow from operating activities

    The “Adjusted Earnings” measure aims to facilitate a comparative understanding of Shell’s financial performance from period to period by removing the effects of oil price changes on inventory carrying amounts and removing the effects of identified items. These items are in some cases driven by external factors and may, either individually or collectively, hinder the comparative understanding of Shell’s financial results from period to period. This measure excludes earnings attributable to non-controlling interest.

    We define “Adjusted EBITDA” as “Income/(loss) for the period” adjusted for current cost of supplies; identified items; tax charge/(credit); depreciation, amortisation and depletion; exploration well write-offs and net interest expense. All items include the non-controlling interest component. Management uses this measure to evaluate Shell’s performance in the period and over time.

                                       
         
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    928    4,291    474    Income/(loss) attributable to Shell plc shareholders 16,093    19,359   
    113    100    62    Income/(loss) attributable to non-controlling interest 427    277   
    (45)   477    811    Add: Current cost of supplies adjustment attributable to Shell plc shareholders 257    650   
    (7)   26    34    Add: Current cost of supplies adjustment attributable to non-controlling interest 14    (5)  
    989    4,894    1,381    CCS earnings 16,792    20,281   
                                                   
     
    Q4 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    CCS earnings 989 1,744 1,031 103 (328) (1,226) (335)
    Less: Identified items (2,778) (421) (651) (736) (99) (914) 45
    Less: CCS earnings attributable to non-controlling interest 106            
    Add: Identified items attributable to non-controlling interest —            
    Adjusted Earnings 3,661            
    Add: Non-controlling interest 106            
    Adjusted Earnings plus non-controlling interest 3,766 2,165 1,682 839 (229) (311) (380)
    Add: Taxation charge/(credit) excluding tax impact of identified items 3,371 635 2,618 266 (198) 97 (46)
    Add: Depreciation, depletion and amortisation excluding impairments 5,829 1,440 2,803 587 896 96 8
    Add: Exploration well write-offs 649 277 372        
    Add: Interest expense excluding identified items 1,213 54 201 17 16 2 923
    Less: Interest income 548 3 — — 10 7 529
    Adjusted EBITDA 14,281 4,568 7,676 1,709 475 (123) (24)
    Less: Current cost of supplies adjustment before taxation (75)     (2) (73)    
    Joint ventures and associates (dividends received less profit) 451 110 (22) 172 139 51 —
    Derivative financial instruments 319 120 (28) (8) 230 533 (527)
    Taxation paid (2,910) (635) (2,019) (130) 36 (41) (120)
    Other (1,461) 114 (486) (1,227) (313) 77 375
    (Increase)/decrease in working capital 2,407 114 (611) 845 1,394 353 312
    Cash flow from operating activities 13,162 4,391 4,509 1,363 2,032 850 16

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    Q3 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    CCS earnings 4,894 2,631 2,289 760 341 (481) (647)
    Less: Identified items (1,259) (240) (153) (422) (122) (319) (3)
    Less: CCS earnings attributable to non-controlling interest 126            
    Add: Identified items attributable to non-controlling interest —            
    Adjusted Earnings 6,028            
    Add: Non-controlling interest 126            
    Adjusted Earnings plus non-controlling interest 6,153 2,871 2,443 1,182 463 (162) (643)
    Add: Taxation charge/(credit) excluding tax impact of identified items 3,571 949 2,413 322 (73) (1) (39)
    Add: Depreciation, depletion and amortisation excluding impairments 5,578 1,369 2,691 564 862 86 6
    Add: Exploration well write-offs 150 2 148 — — — —
    Add: Interest expense excluding identified items 1,173 49 183 13 14 2 912
    Less: Interest income 619 5 8 — 25 — 581
    Adjusted EBITDA 16,005 5,234 7,871 2,081 1,240 (75) (346)
    Less: Current cost of supplies adjustment before taxation 665     334 331    
    Joint ventures and associates (dividends received less profit) (62) (146) (90) 51 63 61 —
    Derivative financial instruments 133 (373) 47 98 88 (106) 380
    Taxation paid (3,028) (814) (2,074) (241) 23 (33) 112
    Other (365) (32) (406) 275 107 (75) (234)
    (Increase)/decrease in working capital 2,665 (247) (78) 792 2,131 (136) 204
    Cash flow from operating activities 14,684 3,623 5,268 2,722 3,321 (364) 115
                                                   
     
    Q4 2023 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    CCS earnings 1,381 1,733 2,151 226 (1,828) (272) (629)
    Less: Identified items (6,033) (2,235) (909) (567) (1,857) (445) (19)
    Less: CCS earnings attributable to non-controlling interest 97            
    Add: Identified items attributable to non-controlling interest (11)            
    Adjusted Earnings 7,306            
    Add: Non-controlling interest 108            
    Adjusted Earnings plus non-controlling interest 7,414 3,968 3,060 794 29 173 (609)
    Add: Taxation charge/(credit) excluding tax impact of identified items 2,121 1,065 1,560 128 (271) (4) (358)
    Add: Depreciation, depletion and amortisation excluding impairments 5,986 1,457 2,951 569 915 89 6
    Add: Exploration well write-offs 243 63 180 — — — —
    Add: Interest expense excluding identified items 1,165 36 135 10 21 1 961
    Less: Interest income 595 4 14 1 24 7 544
    Adjusted EBITDA 16,335 6,584 7,872 1,500 670 253 (544)
    Less: Current cost of supplies adjustment before taxation 1,109     572 537    
    Joint ventures and associates (dividends received less profit) 246 208 (250) 32 225 29 1
    Derivative financial instruments (1,030) (1,596) 52 4 293 (268) 487
    Taxation paid (3,604) (731) (2,015) (282) (270) (413) 108
    Other (947) (229) 388 (508) (422) 146 (322)
    (Increase)/decrease in working capital 2,683 (639) (260) 1,593 1,191 (1,012) 1,810
    Cash flow from operating activities 12,575 3,597 5,787 1,767 1,150 (1,265) 1,540

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    Full year 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    CCS earnings 16,792 9,590 7,772 1,894 1,757 (1,229) (2,992)
    Less: Identified items (7,347) (1,800) (623) (1,991) (1,177) (732) (1,024)
    Less: CCS earnings attributable to non-controlling interest 442            
    Add: Identified items attributable to non-controlling interest 18            
    Adjusted Earnings 23,716            
    Add: Non-controlling interest 424            
    Adjusted Earnings plus non-controlling interest 24,139 11,390 8,395 3,885 2,934 (497) (1,968)
    Add: Taxation charge/(credit) excluding tax impact of identified items 15,013 3,520 9,865 1,305 364 87 (128)
    Add: Depreciation, depletion and amortisation excluding impairments 22,703 5,594 10,971 2,235 3,495 383 25
    Add: Exploration well write-offs 1,622 291 1,331        
    Add: Interest expense excluding identified items 4,697 189 720 52 70 6 3,660
    Less: Interest income 2,372 8 18 1 79 2 2,265
    Adjusted EBITDA 65,803 20,978 31,264 7,476 6,783 (22) (675)
    Less: Current cost of supplies adjustment before taxation 363     254 109    
    Joint ventures and associates (dividends received less profit) (328) (137) (946) 262 304 190 —
    Derivative financial instruments 1,472 (1,466) 24 59 219 3,012 (376)
    Taxation paid (12,002) (2,955) (7,851) (562) (146) (457) (31)
    Other (1,961) 23 (1,464) (616) (321) 152 264
    (Increase)/decrease in working capital 2,062 467 216 998 524 923 (1,065)
    Cash flow from operating activities 54,684 16,909 21,244 7,363 7,253 3,798 (1,882)
                                                   
     
    Full year 2023 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    CCS earnings 20,281 7,058 8,539 3,058 1,482 3,089 (2,944)
    Less: Identified items (8,252) (6,861) (1,267) (254) (2,135) 2,333 (69)
    Less: CCS earnings attributable to non-controlling interest 273            
    Add: Identified items attributable to non-controlling interest (11)            
    Adjusted Earnings 28,250            
    Add: Non-controlling interest 284            
    Adjusted Earnings plus non-controlling interest 28,534 13,919 9,806 3,312 3,617 756 (2,875)
    Add: Taxation charge/(credit) excluding tax impact of identified items 13,674 3,837 8,280 936 287 341 (8)
    Add: Depreciation, depletion and amortisation excluding impairments 23,106 5,756 11,309 2,048 3,582 392 19
    Add: Exploration well write-offs 867 121 746 — — — —
    Add: Interest expense excluding identified items 4,669 146 507 50 60 4 3,902
    Less: Interest income 2,313 6 27 9 57 12 2,201
    Adjusted EBITDA 68,538 23,773 30,622 6,337 7,489 1,481 (1,164)
    Less: Current cost of supplies adjustment before taxation 848     478 370    
    Joint ventures and associates (dividends received less profit) 79 241 (692) 117 310 102 3
    Derivative financial instruments (6,142) (4,668) 51 (14) 518 (1,988) (41)
    Taxation paid (13,712) (3,574) (8,470) (760) (467) (762) 322
    Other (865) (313) (142) (486) (138) 450 (237)
    (Increase)/decrease in working capital 7,145 2,061 82 845 172 3,701 284
    Cash flow from operating activities 54,191 17,520 21,450 5,561 7,513 2,984 (832)

    Identified Items

    Identified items comprise: divestment gains and losses, impairments, redundancy and restructuring, provisions for onerous contracts, fair value accounting of commodity derivatives and certain gas contracts and the impact of exchange rate movements and inflationary adjustments on certain deferred tax balances, and other items. Identified items in the tables below are presented on a net basis.

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    Q4 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Identified items included in Income/(loss) before taxation              
    Divestment gains/(losses) (288) (99) (66) (216) 42 51 —
    Impairment reversals/(impairments) (2,554) (523) (183) (493) (288) (1,065) (1)
    Redundancy and restructuring (175) (27) (62) (70) (5) (11) (1)
    Provisions for onerous contracts — — — — — — —
    Fair value accounting of commodity derivatives and certain gas contracts 209 136 (14) 58 (38) 67 —
    Other (200) — (165) (33) (2) — —
    Total identified items included in Income/(loss) before taxation (3,008) (514) (491) (753) (291) (958) (2)
    Less: total identified items included in Taxation charge/(credit) (230) (92) 160 (17) (191) (43) (47)
    Identified items included in Income/(loss) for the period              
    Divestment gains/(losses) (321) (96) (51) (247) 33 40 —
    Impairment reversals/(impairments) (2,170) (339) (152) (458) (224) (996) (1)
    Redundancy and restructuring (115) (16) (34) (52) (3) (8) (1)
    Provisions for onerous contracts — — — — — — —
    Fair value accounting of commodity derivatives and certain gas contracts 184 109 (4) 46 (17) 50 —
    Impact of exchange rate movements and inflationary adjustments on tax balances (210) (57) (199) — — — 46
    Other (147) (22) (212) (25) 113 — —
    Impact on CCS earnings (2,778) (421) (651) (736) (99) (914) 45
    Impact on CCS earnings attributable to non-controlling interest — — — — — — —
    Impact on CCS earnings attributable to Shell plc shareholders (2,778) (421) (651) (736) (99) (914) 45

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    Q3 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Identified items included in Income/(loss) before taxation              
    Divestment gains/(losses) (154) 1 (2) (110) (19) (20) (3)
    Impairment reversals/(impairments) (338) (6) (3) (195) (120) (14) —
    Redundancy and restructuring (552) (69) (189) (136) (141) (26) 10
    Provisions for onerous contracts (7) — — (7) — — —
    Fair value accounting of commodity derivatives and certain gas contracts (602) (252) (13) (78) 126 (385) —
    Other1 (136) — (141) (1) (11) 16 —
    Total identified items included in Income/(loss) before taxation (1,789) (327) (348) (526) (165) (430) 7
    Less: total identified items included in Taxation charge/(credit) (530) (87) (195) (104) (43) (111) 10
    Identified items included in Income/(loss) for the period              
    Divestment gains/(losses) (129) 1 (6) (84) (15) (23) (2)
    Impairment reversals/(impairments) (288) (4) (2) (179) (92) (10) —
    Redundancy and restructuring (397) (48) (138) (98) (101) (19) 7
    Provisions for onerous contracts (5) — — (5) — — —
    Fair value accounting of commodity derivatives and certain gas contracts (456) (213) (3) (56) 95 (279) —
    Impact of exchange rate movements and inflationary adjustments on tax balances 120 24 104 — — — (8)
    Other (105) — (108) — (8) 12 —
    Impact on CCS earnings (1,259) (240) (153) (422) (122) (319) (3)
    Impact on CCS earnings attributable to non-controlling interest — — — — — — —
    Impact on CCS earnings attributable to Shell plc shareholders (1,259) (240) (153) (422) (122) (319) (3)

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    Q4 2023 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Identified items included in Income/(loss) before taxation              
    Divestment gains/(losses) 222 (21) 134 (30) (33) 168 5
    Impairment reversals/(impairments) (5,348) (873) (988) (460) (2,391) (636) —
    Redundancy and restructuring (275) (1) (11) (128) (102) (31) (2)
    Provisions for onerous contracts — — — — — — —
    Fair value accounting of commodity derivatives and certain gas contracts (1,357) (1,708) 60 (47) 199 138 —
    Other (33) 57 (170) 2 77 — —
    Total identified items included in Income/(loss) before taxation (6,792) (2,545) (974) (664) (2,250) (361) 2
    Less: total identified items included in Taxation charge/(credit) (759) (309) (65) (96) (394) 84 22
    Identified items included in Income/(loss) for the period              
    Divestment gains/(losses) 227 (13) 128 (23) (26) 158 3
    Impairment reversals/(impairments) (3,935) (547) (454) (415) (1,968) (551) —
    Redundancy and restructuring (206) — (6) (96) (78) (24) (1)
    Provisions for onerous contracts — — — — — — —
    Fair value accounting of commodity derivatives and certain gas contracts (1,336) (1,587) 21 (34) 138 125 —
    Impact of exchange rate movements and inflationary adjustments on tax balances (363) 31 (373) — — — (21)
    Other (419) (119) (225) 2 77 (154) —
    Impact on CCS earnings (6,033) (2,235) (909) (567) (1,857) (445) (19)
    Impact on CCS earnings attributable to non-controlling interest (11) — — (11) — — —
    Impact on CCS earnings attributable to Shell plc shareholders (6,022) (2,235) (909) (556) (1,857) (445) (19)

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    Full year 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Identified items included in Income/(loss) before taxation              
    Divestment gains/(losses) (288) (100) 89 (400) 6 119 (3)
    Impairment reversals/(impairments) (5,051) (555) (362) (1,747) (1,205) (1,181) (1)
    Redundancy and restructuring (1,012) (106) (320) (296) (195) (97) 2
    Provisions for onerous contracts (24) (3) (14) (7) — — —
    Fair value accounting of commodity derivatives and certain gas contracts (1,012) (1,286) (58) 49 (117) 399 —
    Other1 (1,481) (126) (436) (1) 146 39 (1,103)
    Total identified items included in Income/(loss) before taxation (8,867) (2,176) (1,100) (2,402) (1,364) (720) (1,105)
    Less: total identified items included in Taxation charge/(credit) (1,521) (376) (477) (411) (187) 12 (81)
    Identified items included in Income/(loss) for the period              
    Divestment gains/(losses) (319) (96) 67 (386) 4 94 (2)
    Impairment reversals/(impairments) (4,371) (363) (323) (1,423) (1,176) (1,085) (1)
    Redundancy and restructuring (712) (71) (214) (215) (142) (71) 1
    Provisions for onerous contracts (19) (3) (11) (5) — — —
    Fair value accounting of commodity derivatives and certain gas contracts (849) (1,088) (14) 40 (86) 300 —
    Impact of exchange rate movements and inflationary adjustments on tax balances 363 (49) 313 — — — 99
    Other1 (1,440) (130) (440) (1) 223 30 (1,122)
    Impact on CCS earnings (7,347) (1,800) (623) (1,991) (1,177) (732) (1,024)
    Impact on CCS earnings attributable to non-controlling interest 18 — — — 18 — —
    Impact on CCS earnings attributable to Shell plc shareholders (7,365) (1,800) (623) (1,991) (1,195) (732) (1,024)

    1.Corporate includes reclassifications from equity to profit and loss of cumulative currency translation differences related to funding structures resulting in unfavourable movements of $1,122 million. These currency translation differences were previously recognised in other comprehensive income and accumulated in equity as part of accumulated other comprehensive income.

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    Full year 2023 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Identified items included in Income/(loss) before taxation              
    Divestment gains/(losses) 257 (22) 209 1 (46) 109 5
    Impairment reversals/(impairments) (8,300) (3,147) (1,187) (509) (2,690) (767) —
    Redundancy and restructuring (329) (1) (21) (150) (106) (32) (18)
    Provisions for onerous contracts (24) — — — (24) — —
    Fair value accounting of commodity derivatives and certain gas contracts (419) (4,755) 447 20 276 3,593 —
    Other 82 32 (615) 300 (43) 408 —
    Total identified items included in Income/(loss) before taxation (8,732) (7,892) (1,166) (339) (2,632) 3,311 (14)
    Less: total identified items included in Taxation charge/(credit) (481) (1,031) 100 (85) (497) 978 55
    Identified items included in Income/(loss) for the period              
    Divestment gains/(losses) 277 (14) 208 1 (35) 113 3
    Impairment reversals/(impairments) (6,219) (2,247) (642) (466) (2,195) (669) —
    Redundancy and restructuring (241) — (9) (113) (82) (24) (12)
    Provisions for onerous contracts (18) — — — (18) — —
    Fair value accounting of commodity derivatives and certain gas contracts (1,284) (4,407) 127 26 214 2,756 —
    Impact of exchange rate movements and inflationary adjustments on tax balances (355) — (295) — — — (60)
    Other (412) (193) (656) 298 (19) 158 —
    Impact on CCS earnings (8,252) (6,861) (1,267) (254) (2,135) 2,333 (69)
    Impact on CCS earnings attributable to non-controlling interest (11) — — (11) — — —
    Impact on CCS earnings attributable to Shell plc shareholders (8,240) (6,861) (1,267) (242) (2,135) 2,333 (69)

    The identified items categories above may include after-tax impacts of identified items of joint ventures and associates which are fully reported within “Share of profit/(loss) of joint ventures and associates” in the Consolidated Statement of Income, and fully reported as identified items included in Income/(loss) before taxation in the table above. Identified items related to subsidiaries are consolidated and reported across appropriate lines of the Consolidated Statement of Income. Only pre-tax identified items reported by subsidiaries are taken into account in the calculation of underlying operating expenses (Reference F).

    Provisions for onerous contracts: Provisions for onerous contracts that relate to businesses that Shell has exited or to redundant assets or assets that cannot be used.

    Fair value accounting of commodity derivatives and certain gas contracts: In the ordinary course of business, Shell enters into contracts to supply or purchase oil and gas products, as well as power and environmental products. Shell also enters into contracts for tolling, pipeline and storage capacity. Derivative contracts are entered into for mitigation of resulting economic exposures (generally price exposure) and these derivative contracts are carried at period-end market price (fair value), with movements in fair value recognised in income for the period. Supply and purchase contracts entered into for operational purposes, as well as contracts for tolling, pipeline and storage capacity, are, by contrast, recognised when the transaction occurs; furthermore, inventory is carried at historical cost or net realisable value, whichever is lower. As a consequence, accounting mismatches occur because: (a) the supply or purchase transaction is recognised in a different period, or (b) the inventory is measured on a different basis. In addition, certain contracts are, due to pricing or delivery conditions, deemed to contain embedded derivatives or written options and are also required to be carried at fair value even though they are entered into for operational purposes. The accounting impacts are reported as identified items.

    Impact of exchange rate movements and inflationary adjustments on tax balances represents the impact on tax balances of exchange rate movements and inflationary adjustments arising on (a) the conversion to dollars of the local currency tax base of non-monetary assets and liabilities, as well as losses (this primarily impacts the Upstream and Integrated Gas segments) and (b) the conversion of dollar-denominated inter-segment loans to local currency, leading to taxable exchange rate gains or losses (this primarily impacts the Corporate segment).

    Other identified items represent other credits or charges that based on Shell management’s assessment hinder the comparative understanding of Shell’s financial results from period to period.

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    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    B.    Adjusted Earnings per share

    Adjusted Earnings per share is calculated as Adjusted Earnings (see Reference A), divided by the weighted average number of shares used as the basis for basic earnings per share (see Note 4).

    C.    Cash capital expenditure

    Cash capital expenditure represents cash spent on maintaining and developing assets as well as on investments in the period. Management regularly monitors this measure as a key lever to delivering sustainable cash flows. Cash capital expenditure is the sum of the following lines from the Consolidated Statement of Cash Flows: Capital expenditure, Investments in joint ventures and associates and Investments in equity securities.

    See Note 2 “Segment information” for the reconciliation of cash capital expenditure.

    D.    Capital employed and Return on average capital employed

    Return on average capital employed (“ROACE”) measures the efficiency of Shell’s utilisation of the capital that it employs. Effective first quarter 2024, the definition of capital employed has been amended to reflect the deduction of cash and cash equivalents. In addition, the numerator applied to ROACE on an Adjusted Earnings plus non-controlling interest basis has been amended to remove interest on cash and cash equivalents for consistency with the revised capital employed definition. Comparative information has been revised to reflect the updated definition. Also, the presentation of ROACE on a net income basis has been discontinued, as this measure is not routinely used by management in assessing the efficiency of capital employed.

    The measure refers to Capital employed which consists of total equity, current debt, and non-current debt reduced by cash and cash equivalents.

    Management believes that the updated methodology better reflects Shell’s approach to managing capital employed, including the management of cash and cash equivalents alongside total debt and equity as part of the financial framework.

    In this calculation, the sum of Adjusted Earnings (see Reference A) plus non-controlling interest (NCI) excluding identified items for the current and previous three quarters, adjusted for after-tax interest expense and after-tax interest income, is expressed as a percentage of the average capital employed excluding cash and cash equivalents for the same period.

                           
     
    $ million Quarters
      Q4 2024 Q3 2024 Q4 2023
    Current debt 9,931 10,119 9,001
    Non-current debt 71,610 72,028 74,794
    Total equity 188,362 192,943 192,597
    Less: Cash and cash equivalents (38,774) (43,031) (40,246)
    Capital employed – opening 231,128 232,059 236,146
    Current debt 11,630 12,015 9,931
    Non-current debt 65,448 64,597 71,610
    Total equity 180,165 189,538 188,362
    Less: Cash and cash equivalents (39,110) (42,252) (38,774)
    Capital employed – closing 218,132 223,898 231,128
    Capital employed – average 224,630 227,979 233,637

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    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                           
     
    $ million Quarters
      Q4 2024 Q3 2024 Q4 2023
    Adjusted Earnings – current and previous three quarters (Reference A) 23,716 27,361 28,250
    Add: Income/(loss) attributable to NCI – current and previous three quarters 427 376 277
    Add: Current cost of supplies adjustment attributable to NCI – current and previous three quarters 14 56 (5)
    Less: Identified items attributable to NCI (Reference A) – current and previous three quarters 18 7 (11)
    Adjusted Earnings plus NCI excluding identified items – current and previous three quarters 24,139 27,787 28,534
    Add: Interest expense after tax – current and previous three quarters 2,701 2,698 2,728
    Less: Interest income after tax on cash and cash equivalents – current and previous three quarters 1,389 1,392 1,287
    Adjusted Earnings plus NCI excluding identified items before interest expense and interest income – current and previous three quarters 25,452 29,093 29,975
    Capital employed – average 224,630 227,979 233,637
    ROACE on an Adjusted Earnings plus NCI basis 11.3% 12.8% 12.8%

    E.    Net debt and gearing

    Net debt is defined as the sum of current and non-current debt, less cash and cash equivalents, adjusted for the fair value of derivative financial instruments used to hedge foreign exchange and interest rate risk relating to debt, and associated collateral balances. Management considers this adjustment useful because it reduces the volatility of net debt caused by fluctuations in foreign exchange and interest rates, and eliminates the potential impact of related collateral payments or receipts. Debt-related derivative financial instruments are a subset of the derivative financial instrument assets and liabilities presented on the balance sheet. Collateral balances are reported under “Trade and other receivables” or “Trade and other payables” as appropriate.

    Gearing is a measure of Shell’s capital structure and is defined as net debt (total debt less cash and cash equivalents) as a percentage of total capital (net debt plus total equity).

                           
     
    $ million  
      December 31, 2024 September 30, 2024 December 31, 2023
    Current debt 11,630    12,015    9,931   
    Non-current debt 65,448    64,597    71,610   
    Total debt 77,078    76,613    81,541   
    Of which lease liabilities 28,702    25,590    27,709   
    Add: Debt-related derivative financial instruments: net liability/(asset) 2,469    1,694    1,835   
    Add: Collateral on debt-related derivatives: net liability/(asset) (1,628)   (821)   (1,060)  
    Less: Cash and cash equivalents (39,110)   (42,252)   (38,774)  
    Net debt 38,809    35,234    43,542   
    Total equity 180,165    189,538    188,362   
    Total capital 218,974    224,772    231,902   
    Gearing 17.7  % 15.7  % 18.8  %

    F.    Operating expenses and Underlying operating expenses

    Operating expenses

    Operating expenses is a measure of Shell’s cost management performance, comprising the following items from the Consolidated Statement of Income: production and manufacturing expenses; selling, distribution and administrative expenses; and research and development expenses.

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    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                                                   
     
    Q4 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Production and manufacturing expenses 5,839 982 2,470 270 1,632 480 5
    Selling, distribution and administrative expenses 3,231 39 96 2,258 471 241 126
    Research and development 331 40 69 73 46 37 66
    Operating expenses 9,401 1,061 2,635 2,602 2,149 757 196
                                                   
     
    Q3 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Production and manufacturing expenses 6,138 1,164 2,394 367 1,766 453 (6)
    Selling, distribution and administrative expenses 3,139 (1) (39) 2,408 453 209 110
    Research and development 294 27 75 55 34 22 81
    Operating expenses 9,570 1,190 2,430 2,830 2,253 684 185
                                                   
     
    Q4 2023 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Production and manufacturing expenses 6,807 1,187 2,595 433 1,815 732 44
    Selling, distribution and administrative expenses1 3,621 39 109 2,520 530 271 153
    Research and development1 469 42 102 67 52 93 112
    Operating expenses 10,897 1,268 2,806 3,021 2,397 1,096 309
                                                   
     
    Full year 2024 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Production and manufacturing expenses 23,379 4,153 9,351 1,322 6,605 1,934 14
    Selling, distribution and administrative expenses 12,439 164 176 9,149 1,637 887 426
    Research and development 1,099 125 263 209 151 94 257
    Operating expenses 36,918 4,441 9,791 10,681 8,392 2,915 698
                                                   
     
    Full year 2023 $ million
      Total Integrated Gas Upstream Marketing Chemicals and Products Renewables and Energy Solutions Corporate
    Production and manufacturing expenses 25,240 4,529 9,186 1,463 7,394 2,610 58
    Selling, distribution and administrative expenses1 13,433 154 325 9,426 2,023 1,058 446
    Research and development1 1,287 126 318 252 181 96 314
    Operating expenses 39,960 4,808 9,829 11,141 9,598 3,763 818

    1.From the first quarter 2024, Wholesale commercial fuels forms part of Mobility with inclusion in the Marketing segment (previously Chemicals and Products segment). Prior period comparatives have been revised to conform with current year presentation with an offsetting impact between Marketing and Chemicals and Products segments (see Note 2). Also, from the first quarter 2024, Shell’s longer-term innovation portfolio is managed centrally and hence reported as part of the Corporate segment (previously all other segments). Prior period comparatives have been revised to conform with current year presentation with an offsetting impact on all the other segments (see Note 2).

    Underlying operating expenses

    Underlying operating expenses is a measure aimed at facilitating a comparative understanding of performance from period to period by removing the effects of identified items, which, either individually or collectively, can cause volatility, in some cases driven by external factors.

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    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

                                       
         
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    9,401    9,570    10,897    Operating expenses 36,918    39,960   
    (174)   (552)   (274)   Redundancy and restructuring (charges)/reversal (1,009)   (325)  
    (88)   (154)   (58)   (Provisions)/reversal (454)   (434)  
    —    —    —    Other 252    —   
    (262)   (706)   (332)   Total identified items (1,210)   (758)  
    9,138    8,864    10,565    Underlying operating expenses 35,707    39,201   

    G.    Free cash flow and Organic free cash flow

    Free cash flow is used to evaluate cash available for financing activities, including dividend payments and debt servicing, after investment in maintaining and growing the business. It is defined as the sum of “Cash flow from operating activities” and “Cash flow from investing activities”.

    Cash flows from acquisition and divestment activities are removed from Free cash flow to arrive at the Organic free cash flow, a measure used by management to evaluate the generation of free cash flow without these activities.

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    13,162    14,684    12,575    Cash flow from operating activities 54,684    54,191   
    (4,431)   (3,857)   (5,657)   Cash flow from investing activities (15,154)   (17,734)  
    8,731    10,827    6,918    Free cash flow 39,530    36,457   
    805    194    612    Less: Divestment proceeds (Reference I) 2,793    3,091   
    1    —    —    Add: Tax paid on divestments (reported under “Other investing cash outflows”) 1    —   
    525    —    206    Add: Cash outflows related to inorganic capital expenditure1 776    2,522   
    8,453    10,633    6,511    Organic free cash flow2 37,514    35,888   

    1.Cash outflows related to inorganic capital expenditure includes portfolio actions which expand Shell’s activities through acquisitions and restructuring activities as reported in capital expenditure lines in the Consolidated Statement of Cash Flows.

    2.Free cash flow less divestment proceeds, adding back outflows related to inorganic expenditure.

    H.    Cash flow from operating activities and cash flow from operating activities excluding working capital movements

    Working capital movements are defined as the sum of the following items in the Consolidated Statement of Cash Flows: (i) (increase)/decrease in inventories, (ii) (increase)/decrease in current receivables, and (iii) increase/(decrease) in current payables.

    Cash flow from operating activities excluding working capital movements is a measure used by Shell to analyse its operating cash generation over time excluding the timing effects of changes in inventories and operating receivables and payables from period to period.

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    13,162    14,684    12,575    Cash flow from operating activities 54,684    54,191   
    131    2,705    4,088    (Increase)/decrease in inventories 1,273    6,325   
    751    4,057    (704)   (Increase)/decrease in current receivables 6,578    12,401   
    1,524    (4,096)   (701)   Increase/(decrease) in current payables1 (5,789)   (11,581)  
    2,407    2,665    2,683    (Increase)/decrease in working capital 2,062    7,145   
    10,755    12,019    9,891    Cash flow from operating activities excluding working capital movements 52,622    47,052   

    1.To further enhance consistency between working capital and the Balance Sheet and the Statement of Cash Flows, from January 1, 2024, onwards movements in current other provisions are recognised in ‘Decommissioning and other provisions’ instead of ‘Increase/(decrease) in current payables’. Comparatives for the fourth quarter 2023 and the full year 2023 have been reclassified accordingly by $653 million and $693 million respectively to conform with current period presentation.

             Page 37

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    I.    Divestment proceeds

    Divestment proceeds represent cash received from divestment activities in the period. Management regularly monitors this measure as a key lever to deliver free cash flow.

                                       
     
    Quarters $ million Full year
    Q4 2024 Q3 2024 Q4 2023   2024 2023
    493    94 540 Proceeds from sale of property, plant and equipment and businesses 1,621 2,565
    305    94 49 Proceeds from joint ventures and associates from sale, capital reduction and repayment of long-term loans 590 474
    6    6 24 Proceeds from sale of equity securities 582 51
    805    194 612 Divestment proceeds 2,793 3,091

    J.    Structural cost reduction

    The structural cost reduction target is used for the purpose of demonstrating how management drives cost discipline across the entire organisation, simplifying our processes and portfolio, and streamlining the way we work.

    Structural cost reduction describes the decrease in underlying operating expenses as a result of operational efficiencies, divestments, workforce reductions and other cost-saving measures that are expected to be sustainable compared with 2022 levels.

    The total change between periods in underlying operating expenses will reflect both structural cost reductions and other changes in spend, including market factors, such as inflation and foreign exchange impacts, as well as changes in activity levels and costs associated with new operations.

    Structural cost reductions are stewarded internally to support management’s oversight of spending over time. 2025 target reflects annualised saving achieved by end-2025.

                           
     
    $ million
      2024 2023 Total1
    Underlying Operating expenses current year 35,707    39,201     
    Underlying Operating expenses previous year 39,201    39,456     
    Total decrease in Underlying operating expenses (3,494)   (255)   (3,749)  
    Of which:      
    Structural cost reduction (2,132)   (987)   (3,119)  
    (Decrease)/Increase of underlying operating expenses except structural cost reduction (1,362)   732    (630)  

    1.Structural cost reductions up to 2024 compared with 2022.

             Page 38

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

    CAUTIONARY STATEMENT

    All amounts shown throughout this Unaudited Condensed Financial Report are unaudited. All peak production figures in Portfolio Developments are quoted at 100% expected production. The numbers presented throughout this Unaudited Condensed Financial Report may not sum precisely to the totals provided and percentages may not precisely reflect the absolute figures, due to rounding.

    The companies in which Shell plc directly and indirectly owns investments are separate legal entities. In this Unaudited Condensed Financial Report, “Shell”, “Shell Group” and “Group” are sometimes used for convenience where references are made to Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to Shell plc and its subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by identifying the particular entity or entities. “Subsidiaries”, “Shell subsidiaries” and “Shell companies” as used in this Unaudited Condensed Financial Report, refer to entities over which Shell plc either directly or indirectly has control. The terms “joint venture”, “joint operations”, “joint arrangements”, and “associates” may also be used to refer to a commercial arrangement in which Shell has a direct or indirect ownership interest with one or more parties. The term “Shell interest” is used for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest.

    Forward-Looking Statements

    This Unaudited Condensed Financial Report contains forward-looking statements (within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) concerning the financial condition, results of operations and businesses of Shell. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements. Forward-looking statements are statements of future expectations that are based on management’s current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in these statements. Forward-looking statements include, among other things, statements concerning the potential exposure of Shell to market risks and statements expressing management’s expectations, beliefs, estimates, forecasts, projections and assumptions. These forward-looking statements are identified by their use of terms and phrases such as “aim”; “ambition”; “anticipate”; “believe”; “commit”; “commitment”; “could”; “estimate”; “expect”; “goals”; “intend”; “may”; “milestones”; “objectives”; “outlook”; “plan”; “probably”; “project”; “risks”; “schedule”; “seek”; “should”; “target”; “will”; “would” and similar terms and phrases. There are a number of factors that could affect the future operations of Shell and could cause those results to differ materially from those expressed in the forward-looking statements included in this Unaudited Condensed Financial Report, including (without limitation): (a) price fluctuations in crude oil and natural gas; (b) changes in demand for Shell’s products; (c) currency fluctuations; (d) drilling and production results; (e) reserves estimates; (f) loss of market share and industry competition; (g) environmental and physical risks; (h) risks associated with the identification of suitable potential acquisition properties and targets, and successful negotiation and completion of such transactions; (i) the risk of doing business in developing countries and countries subject to international sanctions; (j) legislative, judicial, fiscal and regulatory developments including regulatory measures addressing climate change; (k) economic and financial market conditions in various countries and regions; (l) political risks, including the risks of expropriation and renegotiation of the terms of contracts with governmental entities, delays or advancements in the approval of projects and delays in the reimbursement for shared costs; (m) risks associated with the impact of pandemics, such as the COVID-19 (coronavirus) outbreak, regional conflicts, such as the Russia-Ukraine war, and a significant cyber security breach; and (n) changes in trading conditions. No assurance is provided that future dividend payments will match or exceed previous dividend payments. All forward-looking statements contained in this Unaudited Condensed Financial Report are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. Readers should not place undue reliance on forward-looking statements. Additional risk factors that may affect future results are contained in Shell plc’s Form 20-F for the year ended December 31, 2023 (available at www.shell.com/investors/news-and-filings/sec-filings.html and www.sec.gov). These risk factors also expressly qualify all forward-looking statements contained in this Unaudited Condensed Financial Report and should be considered by the reader. Each forward-looking statement speaks only as of the date of this Unaudited Condensed Financial Report, January 30, 2025. Neither Shell plc nor any of its subsidiaries undertake any obligation to publicly update or revise any forward-looking statement as a result of new information, future events or other information. In light of these risks, results could differ materially from those stated, implied or inferred from the forward-looking statements contained in this Unaudited Condensed Financial Report.

    Shell’s Net Carbon Intensity

    Also, in this Unaudited Condensed Financial Report we may refer to Shell’s “Net Carbon Intensity” (NCI), which includes Shell’s carbon emissions from the production of our energy products, our suppliers’ carbon emissions in supplying energy for that production and our customers’ carbon emissions associated with their use of the energy products we sell. Shell’s NCI also includes the emissions associated with the production and use of energy products produced by others which Shell purchases for resale. Shell only controls its own emissions. The use of the terms Shell’s “Net Carbon Intensity” or NCI is for convenience only and not intended to suggest these emissions are those of Shell plc or its subsidiaries.

    Shell’s Net-Zero Emissions Target

    Shell’s operating plan, outlook and budgets are forecasted for a ten-year period and are updated every year. They reflect the current economic environment and what we can reasonably expect to see over the next ten years. Accordingly, they reflect our Scope 1, Scope 2 and NCI targets over the next ten years. However, Shell’s operating plans cannot reflect our 2050 net-zero emissions target, as this target is currently outside our planning period. In the future, as society moves towards net-zero emissions, we expect Shell’s operating plans to reflect this movement. However, if society is not net zero in 2050, as of today, there would be significant risk that Shell may not meet this target.

    Forward-Looking Non-GAAP measures

    This Unaudited Condensed Financial Report may contain certain forward-looking non-GAAP measures such as cash capital expenditure and divestments. We are unable to provide a reconciliation of these forward-looking non-GAAP measures to the most comparable GAAP financial measures because certain information needed to reconcile those non-GAAP measures to the most comparable GAAP financial measures is dependent on future events some of which are outside the control of Shell, such as oil and gas prices, interest rates and exchange rates. Moreover, estimating such GAAP measures with the required precision necessary to provide a meaningful reconciliation is extremely difficult and could not be accomplished without unreasonable effort. Non-GAAP measures in respect of future periods which cannot be reconciled to the most comparable GAAP financial measure are calculated in a manner which is consistent with the accounting policies applied in Shell plc’s consolidated financial statements.

    The contents of websites referred to in this Unaudited Condensed Financial Report do not form part of this Unaudited Condensed Financial Report.

    We may have used certain terms, such as resources, in this Unaudited Condensed Financial Report that the United States Securities and Exchange Commission (SEC) strictly prohibits us from including in our filings with the SEC. Investors are urged to consider closely the disclosure in our Form 20-F, File No 1-32575, available on the SEC website www.sec.gov.

    This Unaudited Condensed Financial Report contains inside information.

    January 30, 2025

             Page 39

    SHELL PLC
    4th QUARTER 2024 AND FULL YEAR UNAUDITED RESULTS

         
    The information in this Unaudited Condensed Financial Report reflects the unaudited consolidated financial position and results of Shell plc. Company No. 4366849, Registered Office: Shell Centre, London, SE1 7NA, England, UK.

    Contacts:

    – Sean Ashley, Company Secretary

    – Media: International +44 (0) 207 934 5550; USA +1 832 337 4355

    LEI number of Shell plc: 21380068P1DRHMJ8KU70

    Classification: Inside Information

             Page 40

    The MIL Network –