Taxation – Page 219 – NewzIntel.com

MIL-OSI: Shell plc publishes fourth quarter 2024 press release

Source: GlobeNewswire (MIL-OSI)

London, January 30, 2025

“2024 was another year of strong financial performance across Shell. Despite the lower earnings this quarter, cash delivery remained solid and we generated free cash flow of $40 billion across the year, higher than 2023, in a lower price environment. Our continued focus on simplification helped to deliver over $3 billion in structural cost reductions since 2022, meeting our target ahead of schedule, whilst also making significant progress against all our other financial targets¹.

Today, we announce a 4% increase in our dividends and another $3.5 billion buyback programme, making this the 13th consecutive quarter of at least $3 billion of buybacks, all whilst further strengthening our balance sheet this year to position us well for the future.

We will outline the next steps in our strategy to deliver more value with less emissions at our Capital Markets Day in March.”

Shell plc Chief Executive Officer, Wael Sawan

SOLID CASH FLOW GENERATION; RESILIENT DISTRIBUTIONS

Robust CFFO of $13.2 billion in Q4 2024, with CFFO of $54.7 billion and free cash flow of $39.5 billion for the full year 2024. $22.6 billion distributed to shareholders in 2024, representing 41% of CFFO generated.
Q4 2024 Adjusted Earnings² of $3.7 billion reflect lower prices and margins, higher exploration well write-offs, and the non-cash impact of expiring hedging contracts on LNG trading and optimisation results.
Structural cost reductions of $3.1 billion achieved since 2022, meeting the 2023 Capital Markets Day (CMD23) target a year early, with significant progress against the other CMD23 financial targets¹.
Focus on disciplined capital allocation drove down 2024 cash capex to $21.1 billion; our cash capex 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 in March.
Increasing dividend per share by 4% to $0.358 for the fourth quarter, while commencing a $3.5 billion share buyback programme, expected to be completed by Q1 2025 results announcement.

$ million²		Adj. Earnings	Adj. EBITDA	CFFO	Cash capex
Integrated Gas		2,165	4,568	4,391	1,337
Upstream		1,682	7,676	4,509	2,076
Marketing		839	1,709	1,363	811
Chemicals & Products³		(229)	475	2,032	1,392
Renewables & Energy Solutions		(311)	(123)	850	1,277
Corporate		(380)	(24)	16	30
Less: Non-controlling interest (NCI)		106
Shell	Q4 2024	3,661	14,281	13,162	6,924
	Q3 2024	6,028	16,005	14,684	4,950
	FY 2024	23,716	65,803	54,684	21,084
	FY 2023	28,250	68,538	54,191	24,392

¹Progress to date on the financial targets that were announced during Capital Markets Day in June 2023 is available at www.shell.com/2024-progress-on-cmd23.html.

²Income/(loss) attributable to shareholders for Q4 2024 is $0.9 billion. Reconciliation of non-GAAP measures can be found in the unaudited results, available at www.shell.com/investors.

³Chemicals & Products Adjusted Earnings at a subsegment level are as follows – Chemicals $(0.3) billion and Products $0.0 billion.

CFFO of $13.2 billion for Q4 2024 includes a working capital inflow of $2.4 billion. CFFO reflects tax payments of $2.9 billion, and a $1.4 billion outflow¹ related to the timing impact of payments for emissions certificates and biofuel programmes.
Net debt increased by $3.6 billion over the quarter to $38.8 billion, reflecting the recognition of the LNG Canada pipeline lease liability. Net debt at the end of 2024 was $4.7 billion lower than at the beginning of the year.

$ billion²	Q4 2023	Q1 2024	Q2 2024	Q3 2024	Q4 2024
Divestment proceeds	0.6	1.0	0.8	0.2	0.8
Free cash flow	6.9	9.8	10.2	10.8	8.7
Net debt	43.5	40.5	38.3	35.2	38.8

¹ Includes payments for the Brennstoffemissionshandelsgesetz (Fuel Emissions Trading Act), excludes the payment of German Mineral Oil Taxes.

² Reconciliation of non-GAAP measures can be found in the unaudited results, available at www.shell.com/investor^s.

Q4 2024 FINANCIAL PERFORMANCE DRIVERS

INTEGRATED GAS

Key data	Q3 2024	Q4 2024	Q1 2025 outlook
Realised liquids price ($/bbl)	63	63	—
Realised gas price ($/thousand scf)	7.9	8.1	—
Production (kboe/d)	941	905	930 – 990
LNG liquefaction volumes (MT)	7.5	7.1	6.6 – 7.2
LNG sales volumes (MT)	17.0	15.5	—

Adjusted Earnings reflect lower trading and optimisation results driven by the (non-cash) impact of expiring hedging contracts, and lower volumes due to Pearl GTL turnaround, lower feedgas supply and lower liftings (timing) versus Q3 2024.
Q1 2025 production outlook reflects Pearl GTL being back in operation; LNG liquefaction volumes outlook is impacted by lower feedgas supply.

UPSTREAM

Key data	Q3 2024	Q4 2024	Q1 2025 outlook
Realised liquids price ($/bbl)	75	71	—
Realised gas price ($/thousand scf)	6.6	7.0	—
Liquids production (kboe/d)	1,321	1,332	—
Gas production (million scf/d)	2,844	3,056	—
Total production (kboe/d)	1,811	1,859	1,750 – 1,950

Adjusted Earnings reflect higher volumes, offset by lower prices, above-average well write-offs, and higher year-end opex.
First production achieved from Mero-3 and Whale (January), and FID taken on Bonga North, supporting portfolio longevity.

MARKETING

Key data	Q3 2024	Q4 2024	Q1 2025 outlook
Marketing sales volumes (kb/d)	2,945	2,795	2,500 – 3,000
Mobility (kb/d)	2,119	2,041	—
Lubricants (kb/d)	81	77	—
Sectors & Decarbonisation (kb/d)	745	678	—

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

Adjusted Earnings in Q4 2024 reflect the seasonal impact of lower volumes and lower Mobility margins.

2024 full year Adjusted Earnings were $3.9 billion, up $0.6 billion from 2023, driven by improved margins and lower opex.

CHEMICALS & PRODUCTS

Key data	Q3 2024	Q4 2024	Q1 2025 outlook¹
Refinery processing intake (kb/d)	1,305	1,215	—
Chemicals sales volumes (kT)	3,015	2,926	—
Refinery utilisation (%)	81	76	80 – 88
Chemicals manufacturing plant utilisation (%)	76	75	78 – 86
Global indicative refining margin ($/bbl)	5.5	5.5	—
Global indicative chemical margin ($/t)	164	138	—

¹Oil sands production: In Q1 2025, Shell’s remaining interest in the Canadian oil sands is expected to be swapped for an additional 10% interest in the Scotford upgrader and Quest CCS projects.

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

Adjusted Earnings reflect significantly lower contribution from trading and optimisation, including seasonality effects, and continued weak chemicals margin environment.

RENEWABLES & ENERGY SOLUTIONS

Key data	Q3 2024	Q4 2024
External power sales (TWh)	79	76
Sales of pipeline gas to end-use customers (TWh)	148	165
Renewables power generation capacity (GW)*	7.3	7.4
in operation (GW)	3.4	3.4
under construction and/or committed for sale (GW)	3.9	4.0

*Excludes Shell’s equity share of associates where information cannot be obtained.

Adjusted Earnings were lower than in Q3 2024, largely driven by one-off tax charges in the quarter.

Acquired a 609 MW combined-cycle gas turbine power plant in Rhode Island, USA.

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.

CORPORATE

Key data	Q3 2024	Q4 2024	Q1 2025 outlook
Adjusted Earnings ($ billion)	(0.6)	(0.4)	(0.6) – (0.4)

2024 FULL YEAR

$ billion	Adj. Earnings	CFFO excl. WC	CFFO	Cash capex	Free cash flow
FY 2024	23.7	52.6	54.7	21.1	39.5
FY 2023	28.3	47.1	54.2	24.4	36.5

Operational performance	FY 2023	FY 2024	% change
Oil and gas production (kboe/d)	2,791	2,836	2%
LNG liquefaction volumes (MT)	28.3	29.1	3%
Marketing sales volumes (kb/d)	3,045	2,843	(7)%
Refinery processing intake (kb/d)	1,349	1,344	(0)%
Chemicals sales volumes (kT)	11,245	11,875	6%

Macro indicators	FY 2023	FY 2024	% change
Brent ($/bbl)	83	81	(2)%
Henry Hub ($/MMBtu)	2.5	2.2	(13)%
EU TTF ($/MMBtu)	13.0	11.0	(16)%
Indicative refining margin ($/bbl)	12.5	7.7	(38)%
Indicative chemicals margin ($/t)	133	152	14%

UPCOMING INVESTOR EVENTS

February 25, 2025	Shell LNG Outlook 2025 publication
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

USEFUL LINKS

Results materials Q4 2024

Quarterly Databook Q4 2024

Webcast registration Q 4 202 4

Dividend announcement Q 4 2024

ALTERNATIVE PERFORMANCE (NON-GAAP) MEASURES

This announcement includes certain measures that are calculated and presented on the basis of methodologies other than in accordance with generally accepted accounting principles (GAAP) such as IFRS, including Adjusted Earnings, Adjusted EBITDA, CFFO excluding working capital movements, Cash capital expenditure, free cash flow, Divestment proceeds and Net debt. This information, along with comparable GAAP measures, is useful to investors because it provides a basis for measuring Shell plc’s operating performance and ability to retire debt and invest in new business opportunities. Shell plc’s management uses these financial measures, along with the most directly comparable GAAP financial measures, in evaluating the business performance.

This announcement may contain certain forward-looking non-GAAP measures for 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 the non-GAAP measures to the most comparable GAAP financial measures is dependent on future events some of which are outside the control of the company, 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 estimated in a manner which is consistent with the accounting policies applied in Shell plc’s consolidated financial statements.

CAUTIONARY STATEMENT

The companies in which Shell plc directly and indirectly owns investments are separate legal entities. In this announcement “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 announcement 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.

This announcement 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 announcement, 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 announcement 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 announcement and should be considered by the reader. Each forward-looking statement speaks only as of the date of this announcement, 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 announcement.

All amounts shown throughout this announcement are unaudited. The numbers presented throughout this announcement may not sum precisely to the totals provided and percentages may not precisely reflect the absolute figures, due to rounding.

Shell’s Net Carbon Intensity

Also, in this announcement 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.

The content of websites referred to in this announcement does not form part of this announcement.

We may have used certain terms, such as resources, in this announcement 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.

The financial information presented in this announcement 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.

The information in this announcement does not constitute the unaudited condensed consolidated financial statements which are contained in Shell’s fourth quarter 2024 and full year 2024 unaudited results available on www.shell.com/investors.

CONTACTS

Media: International +44 207 934 5550; USA +1 832 337 4355

The MIL Network –

January 30, 2025

MIL-OSI: Shell plc Fourth Quarter 2024 Interim Dividend

Source: GlobeNewswire (MIL-OSI)

London, January 30, 2025 − The Board of Shell plc (the “Company”) (XLON: SHEL, XNYS: SHEL, XAMS: SHELL) today announced an interim dividend in respect of the fourth quarter of 2024 of US$ 0.358 per ordinary share.

Details relating to the fourth quarter 2024 interim dividend

Per ordinary share (GB00BP6MXD84)	Q4 2024
Shell Shares (US$)	0.358

Shareholders will be able to elect to receive their dividends in US dollars, euros or pounds sterling.

Absent any valid election to the contrary, persons holding their ordinary shares through Euroclear Nederland will receive their dividends in euros.

Absent any valid election to the contrary, shareholders (both holding in certificated and uncertificated form (CREST members)) and persons holding their shares through the Shell Corporate Nominee will receive their dividends in pounds sterling.

The pound sterling and euro equivalent dividend payments will be announced on March 10, 2025.

Per ADS (US7802593050)	Q4 2024
Shell ADSs (US$)	0.716

Cash dividends on American Depositary Shares (“ADSs”) will be paid, by default, in US dollars.

Each ADS represents two ordinary shares. ADSs are evidenced by an American Depositary Receipt (“ADR”) certificate. In many cases the terms ADR and ADS are used interchangeably.

Dividend timetable for the fourth quarter 2024 interim dividend

Event	Date
Announcement date	January 30, 2025
Ex- Dividend Date for ADSs	February 14, 2025
Ex- Dividend Date for ordinary shares	February 13, 2025
Record date	February 14, 2025
Closing of currency election date (see Note below)	February 28, 2025
Pound sterling and euro equivalents announcement date	March 10, 2025
Payment date	March 24, 2025

Note

A different currency election date may apply to shareholders holding shares in a securities account with a bank or financial institution ultimately holding through Euroclear Nederland. This may also apply to other shareholders who do not hold their shares either directly on the Register of Members or in the corporate sponsored nominee arrangement. Shareholders can contact their broker, financial intermediary, bank or financial institution for the election deadline that applies.

Taxation – cash dividends

If you are uncertain as to the tax treatment of any dividends you should consult your tax advisor.

Dividend Reinvestment Programmes (“DRIP”)

The following organisations offer Dividend Reinvestment Plans (“DRIPs”) which enable the Company’s shareholders to elect to have their dividend payments used to purchase the Company’s shares:

Equiniti Financial Services Limited (“EFSL”), for those holding shares (a) directly on the register as certificate holder or as CREST Member and (b) via the Shell Corporate Nominee;

ABN-AMRO NV (“ABN”) for Financial Intermediaries holding shares via Euroclear Nederland;

JPMorgan Chase Bank, N.A. (“JPM”) for holders of ADSs; and

Other DRIPs may also be available from the intermediary through which investors hold their shares and ADSs.

These DRIP offerors provide their DRIPs fully on their account and not on behalf of the Company. Interested parties should contact the relevant DRIP offeror directly.

More information can be found at https://www.shell.com/drip

To be eligible to participate in the DRIPs for the next dividend, shareholders must make a valid dividend reinvestment election before the published date for the close of elections.

Enquiries
Media International: +44 207 934 5550
Media Americas: +1 832 337 4355

Cautionary Note

The companies in which Shell plc directly and indirectly owns investments are separate legal entities. In this announcement “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 announcement 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 announcement 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 announcement, 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 announcement 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 announcement and should be considered by the reader. Each forward-looking statement speaks only as of the date of this announcement, 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 announcement.

Shell’s Net Carbon Intensity

Also, in this announcement 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 announcement 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 announcement do not form part of this announcement.

We may have used certain terms, such as resources, in this announcement 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.

LEI number of Shell plc: 21380068P1DRHMJ8KU70
Classification: Additional regulated information required to be disclosed under the laws of the United Kingdom

The MIL Network –

January 30, 2025

MIL-OSI China: Chinese satellite enterprises provide expanded, improved global services

Source: China State Council Information Office

Chinese space companies have been expanding their satellite services, including communication, navigation and remote sensing, while also accelerating the deployment of satellite constellations in pursuit of better services.

At the start of 2025, China Great Wall Industry Corporation (CGWIC), which offers commercial launch and satellite in-orbit delivery services, completed the delivery of an intelligent remote sensing satellite, known as IRSS-1, to an Omani company.

Launched on Nov. 11, 2024, this one-meter resolution satellite weighs 95 kilograms and has a design life of five years. It will be used for surveys of land and forests, as well as urban planning and disaster monitoring.

The successful delivery of the satellite will play an important role in improving Oman’s remote sensing satellite application capabilities, the CGWIC said.

WIDE REMOTE SENSING COVERAGE

Users from around the world who log on to the website of Chang Guang Satellite Technology Co., Ltd, can browse satellite images captured by the company’s Jilin-1 satellite constellation.

The Jilin-1 constellation, which had its first group of satellites launched back in October 2015, now features more than 117 satellites and is capable of observing any point on the globe about 40 times a day, according to Huang Jian, head of Chang Guang’s overseas business data application.

The Jilin-1 constellation can cover the world six times a year and the entire China 24 times annually, and so can provide frequent updates of satellite images of any location, Huang said, while adding that this capability supports the company’s overseas business expansion.

Chang Guang has been cooperating with more than 130 overseas users in providing services regarding land surveys, urban building investigations, agriculture and forestry.

In response to disasters and emergencies, the company has recently provided satellite images of fires and floods in different parts of the world, following a request from the United Nations.

Notably, the company is planning a new constellation consisting of 200 satellites, according to Xuan Ming, chairman and general manager of Chang Guang. This new constellation will have a spatial resolution of 20 centimeters and can cover the entire globe once a day.

Its temporal resolution, combined with the contribution of the Jilin-1 constellation, will make it possible to revisit any point on Earth within approximately three minutes.

EFFICIENT COMMUNICATION NETWORKS

The commercialization of China’s aerospace sector started in 2014, when the country’s State Council, in a guideline, encouraged private capital to participate in the construction of national civil space infrastructure.

Founded in 2018, Geespace is a science and technology innovation enterprise under the Chinese automaker Geely. It currently operates 30 satellites in three orbital planes, thereby achieving 24-hour coverage of 90 percent of the world, and provides satellite communication services to overseas users.

These satellites are part of the Geesatcom constellation. The low-orbit communication constellation can enable direct satellite connection for automotive autonomous driving, intelligent internet connection, smartphones and other consumer electronic products.

Geesatcom in June 2024 completed its first commercial deployment test in the Middle East. It will cooperate with a number of global operators in switching on a worldwide commercial application.

Through a combination of Geesatcom and its ground system, Geespace provides global medium-and-low-speed satellite communication operations, satellite-based high-precision positioning services and a satellite remote sensing AI service, according to Wan Yang, founder of Geespace.

In the future, Geespace expects to provide access to its satellite application services to clients in both Southeast Asia and Africa.

Another Chinese commercial satellite constellation, Spacesail, will provide satellite communication services to Brazil and broadband internet access for that country’s remote and under-served regions from 2026.

Spacesail is a low Earth orbit mega-constellation with full frequency bands and a multi-layer and multi-orbit design. Its commercial network construction was officially launched on Aug. 6, 2024.

The market for connecting smartphones directly to satellites has become increasingly promising. “Except for the North Pole and South Pole, almost any location on Earth, including oceans, deserts and remote mountainous regions where traditional communications are difficult to achieve, will enjoy a stable network connection — with smartphones directly connected to satellites,” said Wang.

By the end of June 2024, 546 commercial space enterprises were registered and effectively operating in China, China Space Foundation Secretary General Wang Cheng said in November last year at the 15th China International Aviation and Aerospace Exhibition (Airshow China) in Zhuhai, south China’s Guangdong Province.

This booming development of Chinese commercial satellite companies was firmly supported by a series of related policies.

China has issued both a medium- and long-term development plan for civil space infrastructure for the period from 2015 to 2025, aiming to support and regulate the development of its commercial space industry.

The country is also mapping a development plan for civil space infrastructure from 2026 to 2035, according to Li Guoping, chief engineer at the China National Space Administration (CNSA).

MIL OSI China News –

January 30, 2025

MIL-OSI: STMicroelectronics Reports Q4 and FY 2024 Financial Results

Source: GlobeNewswire (MIL-OSI)

PR No: C3309C

STMicroelectronics Reports Q4 and FY 2024 Financial Results

Q4 net revenues $3.32 billion; gross margin 37.7%; operating margin 11.1%; net income $341 million
FY net revenues $13.27 billion; gross margin 39.3%; operating margin 12.6%; net income $1.56 billion
Business outlook at mid-point: Q1 net revenues of $2.51 billion and gross margin of 33.8%
Start of the company-wide program to resize global cost base*

Geneva, January 30, 2025 – STMicroelectronics N.V. (“ST”) (NYSE: STM), a global semiconductor leader serving customers across the spectrum of electronics applications, reported U.S. GAAP financial results for the fourth quarter ended December 31, 2024. This press release also contains non-U.S. GAAP measures (see Appendix for additional information).

ST reported fourth quarter net revenues of $3.32 billion, gross margin of 37.7%, operating margin of 11.1%, and net income of $341 million or $0.37 diluted earnings per share.

Jean-Marc Chery, ST President & CEO, commented:

“FY24 revenues decreased 23.2% to $13.27 billion. Operating margin was 12.6% compared to 26.7% in FY23 and net income decreased 63.0% to $1.56 billion. We invested $2.53 billion in Net Capex (non-U.S. GAAP) while delivering free cash flow (non-U.S. GAAP) of $288 million.”
“Q4 net revenues were in line with the mid-point of our business outlook range driven by higher revenues in Personal Electronics offset by lower revenues in Industrial, while Automotive and CECP were as expected. Q4 gross margin of 37.7% was broadly in line with the mid-point of our business outlook range.”
“Our book-to-bill ratio remained below 1 in Q4 as we continued to face a delayed recovery and inventory correction in Industrial and a slowdown in Automotive, both particularly in Europe.”
“Our first quarter business outlook, at the mid-point, is for net revenues of $2.51 billion, decreasing year-over-year by 27.6% and decreasing sequentially by 24.4%; gross margin is expected to be about 33.8%, impacted by about 500 basis points of unused capacity charges.”
“For 2025, we plan to invest between $2.0 to $2.3 billion in Net Capex (non-U.S. GAAP).”

Quarterly Financial Summary (U.S. GAAP)

(US$ m, except per share data)	Q4 2024	Q3 2024	Q4 2023	Q/Q	Y/Y
Net Revenues	$3,321	$3,251	$4,282	2.2%	-22.4%
Gross Profit	$1,253	$1,228	$1,949	2.1%	-35.7%
Gross Margin	37.7%	37.8%	45.5%	-10 bps	-780 bps
Operating Income	$369	$381	$1,023	-3.3%	-64.0%
Operating Margin	11.1%	11.7%	23.9%	-60 bps	-1,280 bps
Net Income	$341	$351	$1,076	-2.6%	-68.3%
Diluted Earnings Per Share	$0.37	$0.37	$1.14	0%	-67.5%

* For each of the concerned countries, the start of the program will take place in accordance with applicable regulations.

Annual Financial Summary (U.S. GAAP)

(US$ m, except earnings per share data)	FY2024	FY2023	Y/Y
Net Revenues	$13,269	$17,286	-23.2%
Gross Profit	$5,220	$8,287	-37.0%
Gross Margin	39.3%	47.9%	-860 bps
Operating Income	$1,676	$4,611	-63.7%
Operating Margin	12.6%	26.7%	-1,410 bps
Net Income	$1,557	$4,211	-63.0%
Diluted Earnings Per Share	$1.66	$4.46	-62.8%

Fourth Quarter 2024 Summary Review

Reminder: On January 10, 2024, ST announced a new organization which implied a change in segment reporting starting Q1 2024. Prior year comparative periods have been adjusted accordingly. See Appendix for more detail.

Net Revenues by Reportable Segment (US$ m)	Q4 2024	Q3 2024	Q4 2023	Q/Q	Y/Y
Analog products, MEMS and Sensors (AM&S) segment	1,198	1,185	1,418	1.1%	-15.5%
Power and discrete products (P&D) segment	752	807	965	-6.8%	-22.1%
Subtotal: Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group	1,950	1,992	2,383	-2.1%	-18.2%
Microcontrollers (MCU) segment	887	829	1,272	7.0%	-30.2%
Digital ICs and RF Products (D&RF) segment	481	426	623	13.0%	-22.8%
Subtotal: Microcontrollers, Digital ICs and RF products (MDRF) Product Group	1,368	1,255	1,895	9.0%	-27.8%
Others	3	4	4	–	–
Total Net Revenues	$3,321	$3,251	$4,282	2.2%	-22.4%

Net revenues totaled $3.32 billion, representing a year-over-year decrease of 22.4%. Year-over-year net sales to OEMs and Distribution decreased 19.8% and 28.7%, respectively. On a sequential basis, net revenues increased 2.2%, in line with the mid-point of ST’s guidance.

Gross profit totaled $1.25 billion, representing a year-over-year decrease of 35.7%. Gross margin of 37.7%, 30 basis points below the mid-point of ST’s guidance, decreased 780 basis points year-over-year, mainly due to product mix and, to a lesser extent, to sales price and higher unused capacity charges.

Operating income decreased 64.0% to $369 million, compared to $1.02 billion in the year-ago quarter. ST’s operating margin decreased 1,280 basis points on a year-over-year basis to 11.1% of net revenues, compared to 23.9% in the fourth quarter of 2023.

By reportable segment¹, compared with the year-ago quarter:

In Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group:

Analog products, MEMS and Sensors (AM&S) segment:

Revenue decreased 15.5% mainly due to decreases in Analog and in Imaging.
Operating profit decreased by 41.2% to $176 million. Operating margin was 14.7% compared to 21.1%.

Power and Discrete products (P&D) segment:

Revenue decreased 22.1%.
Operating profit decreased by 63.7% to $89 million. Operating margin was 11.9% compared to 25.4%.

In Microcontrollers, Digital ICs and RF products (MDRF) Product Group:

Microcontrollers (MCU) segment:

Revenue decreased 30.2% mainly due to a decrease in GP MCU.
Operating profit decreased by 66.4% to $127 million. Operating margin was 14.3% compared to 29.8%.

Digital ICs and RF products (D&RF) segment:

Revenue decreased 22.8% mainly due to a decrease in ADAS (automotive ADAS and infotainment).
Operating profit decreased by 33.2% to $149 million. Operating margin was 31.0% compared to 35.7%.

Net income and diluted Earnings Per Share decreased to $341 million and $0.37 respectively compared to $1.08 billion and $1.14 respectively in the year-ago quarter. As a reminder, the fourth quarter 2023 net income included a one-time non-cash income tax benefit of $191 million.

Cash Flow and Balance Sheet Highlights

				Trailing 12 Months
(US$ m)	Q4 2024	Q3 2024	Q4 2023	Q4 2024	Q4 2023	TTM Change
Net cash from operating activities	681	723	1,480	2,965	5,992	-50.5%
Free cash flow (non-U.S. GAAP)²	128	136	652	288	1,774	-83.8%

Net cash from operating activities was $681 million in the fourth quarter compared to $1.48 billion in the year-ago quarter. For the full-year 2024, net cash from operating activities decreased 50.5% to $2.97 billion, which represents 22.3% of total revenues.

Net Capex (non-U.S. GAAP), were $470 million in the fourth quarter and $2.53 billion for the full year 2024. In the respective year-ago periods, net capital expenditures were $798 million and $4.11 billion.

Free cash flow (non-U.S. GAAP) was $128 million and $288 million in the fourth quarter and full year 2024, respectively, compared to $652 million and $1.77 billion in the year-ago respective periods.

Inventory at the end of the fourth quarter was $2.79 billion, compared to $2.88 billion in the previous quarter and $2.70 billion in the year-ago quarter. Days sales of inventory at quarter-end was 122 days, compared to 130 days in the previous quarter, and 104 days in the year-ago quarter.

In the fourth quarter, ST paid cash dividends to its stockholders totaling $88 million and executed a $92 million share buy-back, as part of its current share repurchase program.

ST’s net financial position (non-U.S. GAAP) was $3.23 billion as of December 31, 2024, compared to $3.18 billion as of September 28, 2024 and reflected total liquidity of $6.18 billion and total financial debt of $2.95 billion. Adjusted net financial position (non-U.S. GAAP), taking into consideration the effect on total liquidity of advances from capital grants for which capital expenditures have not been incurred yet, stood at $2.85 billion as of December 31, 2024.

Corporate developments

In Q4, we announced the launch of a new company-wide program to reshape our manufacturing footprint accelerating our wafer fab capacity to 300mm Silicon (Agrate and Crolles) and 200mm Silicon Carbide (Catania) and resizing our global cost base.

This program should result in strengthening our capability to grow our revenues with an improved operating efficiency resulting in annual cost savings in the high triple-digit million-dollar range exiting 2027. Specifically in terms of operating expenses (SG&A and R&D), ST expects annual cost savings totaling $300 to 360 million, exiting 2027, compared to the cost base of 2024.

Business Outlook

ST’s guidance, at the mid-point, for the 2025 first quarter is:

Net revenues are expected to be $2.51 billion, a decrease of 24.4% sequentially, plus or minus 350 basis points.
Gross margin of 33.8%, plus or minus 200 basis points.
This outlook is based on an assumed effective currency exchange rate of approximately $1.06 = €1.00 for the 2025 first quarter and includes the impact of existing hedging contracts.
The first quarter will close on March 29, 2025.

Conference Call and Webcast Information

ST will conduct a conference call with analysts, investors and reporters to discuss its fourth quarter and full year 2024 financial results and current business outlook today at 9:30 a.m. Central European Time (CET) / 3:30 a.m. U.S. Eastern Time (ET). A live webcast (listen-only mode) of the conference call will be accessible at ST’s website, https://investors.st.com, and will be available for replay until February 14, 2025.

Use of Supplemental Non-U.S. GAAP Financial Information

This press release contains supplemental non-U.S. GAAP financial information.

Readers are cautioned that these measures are unaudited and not prepared in accordance with U.S. GAAP and should not be considered as a substitute for U.S. GAAP financial measures. In addition, such non-U.S. GAAP financial measures may not be comparable to similarly titled information from other companies. To compensate for these limitations, the supplemental non-U.S. GAAP financial information should not be read in isolation, but only in conjunction with ST’s consolidated financial statements prepared in accordance with U.S. GAAP.

See the Appendix of this press release for a reconciliation of ST’s non-U.S. GAAP financial measures to their corresponding U.S. GAAP financial measures.

Forward-looking Information

Some of the statements contained in this release that are not historical facts are statements of future expectations and other forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 or Section 21E of the Securities Exchange Act of 1934, each as amended) that are based on management’s current views and assumptions, and are conditioned upon and also involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those anticipated by such statements due to, among other factors:

changes in global trade policies, including the adoption and expansion of tariffs and trade barriers, that could affect the macro-economic environment and adversely impact the demand for our products;
uncertain macro-economic and industry trends (such as inflation and fluctuations in supply chains), which may impact production capacity and end-market demand for our products;
customer demand that differs from projections which may require us to undertake transformation measures that may not be successful in realizing the expected benefits in full or at all;
the ability to design, manufacture and sell innovative products in a rapidly changing technological environment;
changes in economic, social, public health, labor, political, or infrastructure conditions in the locations where we, our customers, or our suppliers operate, including as a result of macroeconomic or regional events, geopolitical and military conflicts, social unrest, labor actions, or terrorist activities;
unanticipated events or circumstances, which may impact our ability to execute our plans and/or meet the objectives of our R&D and manufacturing programs, which benefit from public funding;
financial difficulties with any of our major distributors or significant curtailment of purchases by key customers;
the loading, product mix, and manufacturing performance of our production facilities and/or our required volume to fulfill capacity reserved with suppliers or third-party manufacturing providers;
availability and costs of equipment, raw materials, utilities, third-party manufacturing services and technology, or other supplies required by our operations (including increasing costs resulting from inflation);
the functionalities and performance of our IT systems, which are subject to cybersecurity threats and which support our critical operational activities including manufacturing, finance and sales, and any breaches of our IT systems or those of our customers, suppliers, partners and providers of third-party licensed technology;
theft, loss, or misuse of personal data about our employees, customers, or other third parties, and breaches of data privacy legislation;
the impact of intellectual property (“IP”) claims by our competitors or other third parties, and our ability to obtain required licenses on reasonable terms and conditions;
changes in our overall tax position as a result of changes in tax rules, new or revised legislation, the outcome of tax audits or changes in international tax treaties which may impact our results of operations as well as our ability to accurately estimate tax credits, benefits, deductions and provisions and to realize deferred tax assets;
variations in the foreign exchange markets and, more particularly, the U.S. dollar exchange rate as compared to the Euro and the other major currencies we use for our operations;
the outcome of ongoing litigation as well as the impact of any new litigation to which we may become a defendant;
product liability or warranty claims, claims based on epidemic or delivery failure, or other claims relating to our products, or recalls by our customers for products containing our parts;
natural events such as severe weather, earthquakes, tsunamis, volcano eruptions or other acts of nature, the effects of climate change, health risks and epidemics or pandemics in locations where we, our customers or our suppliers operate;
increased regulation and initiatives in our industry, including those concerning climate change and sustainability matters and our goal to become carbon neutral by 2027 on scope 1 and 2 and partially scope 3;
epidemics or pandemics, which may negatively impact the global economy in a significant manner for an extended period of time, and could also materially adversely affect our business and operating results;
industry changes resulting from vertical and horizontal consolidation among our suppliers, competitors, and customers; and
the ability to successfully ramp up new programs that could be impacted by factors beyond our control, including the availability of critical third-party components and performance of subcontractors in line with our expectations.

Such forward-looking statements are subject to various risks and uncertainties, which may cause actual results and performance of our business to differ materially and adversely from the forward-looking statements. Certain forward-looking statements can be identified by the use of forward-looking terminology, such as “believes”, “expects”, “may”, “are expected to”, “should”, “would be”, “seeks” or “anticipates” or similar expressions or the negative thereof or other variations thereof or comparable terminology, or by discussions of strategy, plans or intentions.

Some of these risk factors are set forth and are discussed in more detail in “Item 3. Key Information — Risk Factors” included in our Annual Report on Form 20-F for the year ended December 31, 2023 as filed with the Securities and Exchange Commission (“SEC”) on February 22, 2024. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this press release as anticipated, believed or expected. We do not intend, and do not assume any obligation, to update any industry information or forward-looking statements set forth in this release to reflect subsequent events or circumstances.

Unfavorable changes in the above or other factors listed under “Item 3. Key Information — Risk Factors” from time to time in our Securities and Exchange Commission (“SEC”) filings, could have a material adverse effect on our business and/or financial condition.

About STMicroelectronics

At ST, we are over 50,000 creators and makers of semiconductor technologies mastering the semiconductor supply chain with state-of-the-art manufacturing facilities. An integrated device manufacturer, we work with more than 200,000 customers and thousands of partners to design and build products, solutions, and ecosystems that address their challenges and opportunities, and the need to support a more sustainable world. Our technologies enable smarter mobility, more efficient power and energy management, and the wide-scale deployment of cloud-connected autonomous things. We are committed to achieving our goal to become carbon neutral on scope 1 and 2 and partially scope 3 by 2027. Further information can be found at www.st.com.

For further information, please contact:

INVESTOR RELATIONS:
Jérôme Ramel
EVP Corporate Development & Integrated External Communication
Tel: +41 22 929 59 20
jerome.ramel@st.com

MEDIA RELATIONS:
Alexis Breton
Corporate External Communications
Tel: + 33 6 59 16 79 08
alexis.breton@st.com

STMicroelectronics N.V.
CONSOLIDATED STATEMENTS OF INCOME
(in millions of U.S. dollars, except per share data ($))

	Three months ended
	December 31,	December 31,
	2024	2023
	(Unaudited)	(Unaudited)

Net sales	3,301	4,262
Other revenues	20	20
NET REVENUES	3,321	4,282
Cost of sales	(2,068)	(2,333)
GROSS PROFIT	1,253	1,949
Selling, general and administrative expenses	(420)	(416)
Research and development expenses	(523)	(521)
Other income and expenses, net	59	11
Total operating expenses	(884)	(926)
OPERATING INCOME	369	1,023
Interest income, net	52	57
Other components of pension benefit costs	(3)	(5)
INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTEREST	418	1,075
Income tax (expense) benefit	(82)	6
NET INCOME	336	1,081
Net loss (income) attributable to noncontrolling interest	5	(5)
NET INCOME ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS	341	1,076

EARNINGS PER SHARE (BASIC) ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS	0.38	1.19
EARNINGS PER SHARE (DILUTED) ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS	0.37	1.14

NUMBER OF WEIGHTED AVERAGE SHARES USED IN CALCULATING DILUTED EPS	935.7	942.9

STMicroelectronics N.V.
CONSOLIDATED STATEMENTS OF INCOME
(in millions of U.S. dollars, except per share data ($))

	Twelve months ended
	December 31,	December 31,
	2024	2023
	(Unaudited)	(Audited)

Net sales	13,217	17,239
Other revenues	52	47
NET REVENUES	13,269	17,286
Cost of sales	(8,049)	(8,999)
GROSS PROFIT	5,220	8,287
Selling, general and administrative expenses	(1,649)	(1,631)
Research and development expenses	(2,077)	(2,100)
Other income and expenses, net	182	55
Total operating expenses	(3,544)	(3,676)
OPERATING INCOME	1,676	4,611
Interest income, net	218	171
Other components of pension benefit costs	(15)	(19)
Loss on financial instruments, net	(1)	–
INCOME BEFORE INCOME TAXES AND NONCONTROLLING INTEREST	1,878	4,763
Income tax expense	(313)	(541)
NET INCOME	1,565	4,222
Net income attributable to noncontrolling interest	(8)	(11)
NET INCOME ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS	1,557	4,211

EARNINGS PER SHARE (BASIC) ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS	1.73	4.66
EARNINGS PER SHARE (DILUTED) ATTRIBUTABLE TO PARENT COMPANY STOCKHOLDERS	1.66	4.46

NUMBER OF WEIGHTED AVERAGE SHARES USED IN CALCULATING DILUTED EPS	939.3	944.2


STMicroelectronics N.V.
CONSOLIDATED BALANCE SHEETS
As at	December 31,	September 28,	December 31,
In millions of U.S. dollars	2024	2024	2023
	(Unaudited)	(Unaudited)	(Audited)
ASSETS
Current assets:
Cash and cash equivalents	2,282	3,077	3,222
Short-term deposits	1,450	977	1,226
Marketable securities	2,452	2,242	1,635
Trade accounts receivable, net	1,749	1,730	1,731
Inventories	2,794	2,875	2,698
Other current assets	1,007	1,062	1,295
Total current assets	11,734	11,963	11,807
Goodwill	290	303	303
Other intangible assets, net	346	354	367
Property, plant and equipment, net	10,877	11,258	10,554
Non-current deferred tax assets	464	547	592
Long-term investments	71	20	22
Other non-current assets	961	1,071	808
	13,009	13,553	12,646
Total assets	24,743	25,516	24,453

LIABILITIES AND EQUITY
Current liabilities:
Short-term debt	990	1,003	217
Trade accounts payable	1,323	1,585	1,856
Other payables and accrued liabilities	1,306	1,327	1,525
Dividends payable to stockholders	88	177	54
Accrued income tax	66	116	78
Total current liabilities	3,773	4,208	3,730
Long-term debt	1,963	2,112	2,710
Post-employment benefit obligations	377	397	372
Long-term deferred tax liabilities	47	60	54
Other long-term liabilities	904	935	735
	3,291	3,504	3,871
Total liabilities	7,064	7,712	7,601
Commitment and contingencies
Equity
Parent company stockholders’ equity
Common stock (preferred stock: 540,000,000 shares authorized, not issued; common stock: Euro 1.04 par value, 1,200,000,000 shares authorized, 911,281,920 shares issued, 898,175,408 shares outstanding as of December 31, 2024)	1,157	1,157	1,157
Additional Paid-in Capital	3,088	3,032	2,866
Retained earnings	13,459	13,118	12,470
Accumulated other comprehensive income	236	657	613
Treasury stock	(491)	(400)	(377)
Total parent company stockholders’ equity	17,449	17,564	16,729
Noncontrolling interest	230	240	123
Total equity	17,679	17,804	16,852
Total liabilities and equity	24,743	25,516	24,453


STMicroelectronics N.V.

SELECTED CASH FLOW DATA

Cash Flow Data (in US$ millions)	Q4 2024	Q3 2024	Q4 2023

Net Cash from operating activities	681	723	1,480
Net Cash used in investing activities	(1,259)	(601)	(1,610)
Net Cash from (used in) financing activities	(209)	(142)	336
Net Cash increase (decrease)	(795)	(15)	211

Selected Cash Flow Data (in US$ millions)	Q4 2024	Q3 2024	Q4 2023

Depreciation & amortization	451	440	414
Net payment for Capital expenditures	(501)	(601)	(798)
Dividends paid to stockholders	(88)	(80)	(60)
Change in inventories, net	(2)	(17)	219

Appendix
ST
New organization

On January 10, 2024, ST announced a new organization to deliver enhanced product development innovation and efficiency, time-to-market as well as customer focus by end market. This new organization implies a change in segment reporting which is applied from January 1, 2024.

ST moved from three reportable segments (ADG, AMS and MDG) to four reportable segments as follows:

In Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group:
- Analog products, MEMS and Sensors (AM&S) segment, comprised of ST analog products, MEMS sensors and actuators, and optical sensing solutions.
- Power and Discrete products (P&D) segment comprised of discrete and power transistor products.

In this Press Release, “Analog” refers to ST analog products, “MEMS” to MEMS sensors and actuators and “Imaging” to optical sensing solutions.

In Microcontrollers, Digital ICs and RF products (MDRF) Product Group:
- Microcontrollers (MCU) segment, comprised of general-purpose and automotive microcontrollers, microprocessors and connected security products (including EEPROM).
- Digital ICs and RF Products (D&RF) segment, comprised of automotive ADAS, infotainment, RF and communications products.

In this Press release, “Auto MCU” refers to Automotive microcontrollers and microprocessors, “GP MCU” to general purpose microcontrollers and microprocessors, “Connected Security” to connected security products (including EEPROM), “ADAS” to automotive ADAS and infotainment, “RF Communications” to RF and communications products.

Prior year quarters comparative information has been adjusted accordingly.

(Appendix – continued)
ST – Supplemental Financial Information

	Q4 2024	Q3 2024	Q2 2024	Q1 2024	Q4 2023	FY 2024	FY 2023
Net Revenues By Market Channel (%)
Total OEM	73%	76%	73%	70%	70%	73%	66%
Distribution	27%	24%	27%	30%	30%	27%	34%

€/$ Effective Rate	1.09	1.08	1.08	1.09	1.08	1.08	1.08

Reportable Segment Data (US$ m)
Analog products, MEMS and Sensors (AM&S) segment
– Net Revenues	1,198	1,185	1,165	1,217	1,418	4,764	5,478
– Operating Income	176	175	144	185	300	680	1,191
Power and Discrete products (P&D) segment
– Net Revenues	752	807	747	820	965	3,126	3,852
– Operating Income	89	121	110	138	245	458	1,006
Subtotal: Analog, Power & Discrete, MEMS and Sensors (APMS) Product Group
– Net Revenues	1,950	1,992	1,912	2,037	2,383	7,890	9,330
– Operating Income	265	296	254	323	545	1,138	2,197
Microcontrollers (MCU) segment
– Net Revenues	887	829	800	950	1,272	3,466	5,668
– Operating Income	127	116	72	185	378	499	2,018
Digital ICs and RF Products (D&RF) segment
– Net Revenues	481	426	516	475	623	1,898	2,272
– Operating Income	149	114	150	150	223	564	810
Subtotal: Microcontrollers, Digital ICs and RF products (MDRF) Product Group
– Net Revenues	1,368	1,255	1,316	1,425	1,895	5,364	7,940
– Operating Income	276	230	222	335	601	1,063	2,828
Others ^(a)
– Net Revenues	3	4	4	3	4	15	16
– Operating Income (Loss)	(172)	(145)	(101)	(107)	(123)	(525)	(414)
Total
– Net Revenues	3,321	3,251	3,232	3,465	4,282	13,269	17,286
– Operating Income	369	381	375	551	1,023	1,676	4,611

^(a)Net revenues of Others include revenues from sales assembly services and other revenues. Operating income (loss) of Others include items such as unused capacity charges, including incidents leading to power outage, impairment and restructuring charges, management reorganization costs, start-up and phase out costs, and other unallocated income (expenses) such as: strategic or special research and development programs, certain corporate-level operating expenses, patent claims and litigations, and other costs that are not allocated to reportable segments, as well as operating earnings of other products. Others includes:

(US$ m)	*Q4 2024*	*Q3 2024*	*Q2 2024*	*Q1 2024*	*Q4 2023*	*FY 2024*	*FY 2023*
*Unused capacity charges*	*118*	*104*	84	63	57	*370*	*120*

(Appendix – continued)
ST
Supplemental Non-U.S. GAAP Financial Information
U.S. GAAP – Non-U.S. GAAP Reconciliation

The supplemental non-U.S. GAAP information presented in this press release is unaudited and subject to inherent limitations. Such non-U.S. GAAP information is not based on any comprehensive set of accounting rules or principles and should not be considered as a substitute for U.S. GAAP measurements. Also, our supplemental non-U.S. GAAP financial information may not be comparable to similarly titled non-U.S. GAAP measures used by other companies. Further, specific limitations for individual non-U.S. GAAP measures, and the reasons for presenting non-U.S. GAAP financial information, are set forth in the paragraphs below. To compensate for these limitations, the supplemental non-U.S. GAAP financial information should not be read in isolation, but only in conjunction with our consolidated financial statements prepared in accordance with U.S. GAAP.

ST believes that these non-U.S. GAAP financial measures provide useful information for investors and management because they offer, when read in conjunction with ST’s U.S. GAAP financials, (i) the ability to make more meaningful period-to-period comparisons of ST’s on-going operating results, (ii) the ability to better identify trends in ST’s business and perform related trend analysis, and (iii) to facilitate a comparison of ST’s results of operations against investor and analyst financial models and valuations, which may exclude these items.

Net Financial Position and Adjusted Net Financial Position (non-U.S. GAAP measures)

Net Financial Position, a non-U.S. GAAP measure, represents the difference between our total liquidity and our total financial debt. Our total liquidity includes cash and cash equivalents, restricted cash, if any, short-term deposits, and marketable securities, and our total financial debt includes short-term debt and long-term debt, as reported in our Consolidated Balance Sheets. Starting Q4 2023, ST also presents adjusted net financial position as a non-U.S. GAAP measure, to take into consideration the effect on total liquidity of advances received on capital grants for which capital expenditures have not been incurred yet. Reporting periods prior to Q4 2023 are not impacted.

ST believes its Net Financial Position and Adjusted Net Financial Position provide useful information for investors and management because they give evidence of our global position either in terms of net indebtedness or net cash by measuring our capital resources based on cash and cash equivalents, restricted cash, if any, short-term deposits and marketable securities and the total level of our financial debt. Our definitions of Net Financial Position and Adjusted Net Financial Position may differ from definitions used by other companies, and therefore, comparability may be limited.

(US$ m)	Dec 31 2024	Sep 28 2024	June 29 2024	Mar 30 2024	Dec 31 2023
Cash and cash equivalents	2,282	3,077	3,092	3,133	3,222
Short term deposits	1,450	977	975	1,226	1,226
Marketable securities	2,452	2,242	2,218	1,880	1,635
Total liquidity	6,184	6,296	6,285	6,239	6,083
Short-term debt	(990)	(1,003)	(236)	(238)	(217)
Long-term debt ^(a)	(1,963)	(2,112)	(2,850)	(2,875)	(2,710)
Total financial debt	(2,953)	(3,115)	(3,086)	(3,113)	(2,927)
Net Financial Position	3,231	3,181	3,199	3,126	3,156
Advances received on capital grants	(385)	(366)	(402)	(351)	(152)
Adjusted Net Financial Position	2,846	2,815	2,797	2,775	3,004

^(a)Long-term debt contains standard conditions but does not impose minimum financial ratios. Committed credit facilities for $634 million equivalent, are currently undrawn.

(Appendix – continued)

Net Capex and Free Cash Flow (non-U.S. GAAP measures)

ST presents Net Capex as a non-U.S. GAAP measure, which is reported as part of our Free Cash Flow (non-U.S. GAAP measure), to take into consideration the effect of advances from capital grants received on prior periods allocated to property, plant and equipment in the reporting period.

Net Capex, a non-U.S. GAAP measure, is defined as (i) Payment for purchase of tangible assets, as reported plus (ii) Proceeds from sale of tangible assets, as reported plus (iii) Proceeds from capital grants and other contributions, as reported plus (iv) Advances from capital grants allocated to property, plant and equipment in the reporting period.

ST believes Net Capex provides useful information for investors and management because annual capital expenditures budget includes the effect of capital grants. Our definition of Net Capex may differ from definitions used by other companies.

(US$ m)	Q4 2024	Q3 2024	Q2 2024	Q1 2024	Q4 2023	FY 2024	FY 2023
Payment for purchase of tangible assets, as reported	(584)	(669)	(690)	(1,145)	(1,076)	(3,088)	(4,439)
Proceeds from sale of tangible assets, as reported	–	2	1	2	–	5	8
Proceeds from capital grants and other contributions, as reported	83	66	143	149	278	441	320
Advances from capital grants allocated to property, plant and equipment	31	36	18	27	–	111	–
Net Capex	(470)	(565)	(528)	(967)	(798)	(2,531)	(4,111)

Free Cash Flow, which is a non-U.S. GAAP measure, is defined as (i) net cash from operating activities plus (ii) Net Capex plus (iii) payment for purchase (and proceeds from sale) of intangible and financial assets and (iv) net cash paid for business acquisitions, if any.

ST believes Free Cash Flow provides useful information for investors and management because it measures our capacity to generate cash from our operating and investing activities to sustain our operations.

Free Cash Flow reconciles with the total cash flow and the net cash increase (decrease) by including the payment for purchases of (and proceeds from matured) marketable securities and net investment in (and proceeds from) short-term deposits, the net cash from (used in) financing activities and the effect of changes in exchange rates, and by excluding the advances from capital grants received on prior periods allocated to property, plant and equipment in the reporting period. Our definition of Free Cash Flow may differ from definitions used by other companies.

(US$ m)	Q4 2024	Q3 2024	Q2 2024	Q1 2024	Q4 2023	FY 2024	FY 2023
Net cash from operating activities	681	723	702	859	1,480	2,965	5,992
Net Capex	(470)	(565)	(528)	(967)	(798)	(2,531)	(4,111)
Payment for purchase of intangible assets, net of proceeds from sale	(32)	(20)	(15)	(26)	(28)	(93)	(97)
Payment for purchase of financial assets, net of proceeds from sale	(51)	(2)	–	–	(2)	(53)	(10)
Free Cash Flow	128	136	159	(134)	652	288	1,774

¹See Appendix for the definition of reportable segments.

²Non-U.S. GAAP. See Appendix for reconciliation to U.S. GAAP and information explaining why ST believes these measures are important.

Attachment

C3309C – Q424 Earnings PR – FINAL FOR PUBLICATION

The MIL Network –

January 30, 2025

MIL-OSI USA: Reed Announces Committee Leadership Assignments for 119th Congress

US Senate News:

Source: United States Senator for Rhode Island Jack Reed
WASHINGTON, DC – Today, after the Senate Appropriations Committee fully organized, U.S. Senator Jack Reed (D-RI) announced his full slate of committee and subcommittee assignments for the 119th Congress.
Senator Reed will continue serving on four ‘A’ committees: Armed Services; Appropriations; Banking, Housing, and Urban Affairs; and the Select Committee on Intelligence. These assignments include two of the three ‘Super A’ Committees: Armed Services and Appropriations.
Senator Reed will serve as Ranking Member of the Senate Armed Services Committee (SASC) and as the Ranking Member of the Appropriations Subcommittee on Financial Services and General Government (FSGG), which has jurisdiction over a diverse group of agencies responsible for regulating the financial and telecommunications industries; collecting taxes and providing taxpayer assistance; providing small business assistance; overseeing the White House and judicial branch operations, and the District of Columbia; construction and management of federal buildings; and overseeing the Federal workforce.
With these assignments, Reed is well-positioned to deliver for Rhode Island while overseeing the U.S. Department of Defense and federal spending decisions through the appropriations process.
“These key committee posts help me fix our roads and bridges, strengthen our economy, deliver for Rhode Island, and chart a responsible fiscal path. My new assignment on the Financial Services and General Government Subcommittee provides another tool to support small business growth, expand economic opportunity, boost Rhode Island’s broadband connections, and ensure the health and safety of our financial markets,” said Reed. “As Congress grapples with a range of complex challenges, I will do everything in my power to help lower prices for working families and ensure Rhode Islanders’ needs are met. I will continue to be a relentless advocate for our state and focus on the issues that Rhode Islanders care about. And I will promote and uphold the constitutional role of Congress, including Congress’s power of the purse. ”
ARMED SERVICES COMMITTEE
Senator Reed is the Ranking Member of the powerful Senate Armed Services Committee, which is responsible for overseeing the U.S. Department of Defense (DOD), military services operating across the domains of land, sea, air, cyberspace, and space, and all DOD agencies, including their budgets and policies, and national security aspects of nuclear energy. Each year, SASC is tasked with producing and passing the National Defense Authorization Act (NDAA).
In 2024, under Reed’s leadership as SASC Chairman, Congress passed the fiscal year 2025 National Defense Authorization Act (NDAA), which authorized $883.7 billion for the U.S. Department of Defense (DOD) and the national security programs of the U.S. Department of Energy. The NDAA offers a blueprint to equip, supply, and train U.S. forces; provide for military families; and strengthen oversight of the Defense Department and military programs. The defense industry is a high-tech sector that contributes to Rhode Island’s economic growth, generates good-paying jobs, and has been a resilient segment of the state’s economy. According to the latest Rhode Island data, the defense industry generated over $4.3 billion in annual economic impact for Rhode Island and a total employment share of 6.2 percent of the state’s workforce.
In addition to his leadership on the Armed Services Committee, Reed is also a member of the Appropriations Subcommittee on Defense, which provides him with additional oversight responsibilities in determining how defense dollars are spent.
APPROPRIATIONS COMMITTEE
Senator Reed will continue to serve as Rhode Island’s only member of the powerful Appropriations Committee, which controls the funding of the federal government.
Senator Reed is the third most senior Democrat on the Appropriations Committee. He works tirelessly to direct federal funding to the Ocean State to create jobs, strengthen infrastructure, and support economic and community development initiatives.
Senator Reed will give up his leadership post on the Subcommittee on the Legislative Branch in order to help lead the Financial Services and General Government Subcommittee.
The FSGG subcommittee drafts the spending plan and oversees annual funding for financial-related agencies including the U.S. Department of Treasury; the Securities and Exchange Commission (SEC); and the Internal Revenue Service (IRS). It is responsible for funding the Executive Office of the President and federal election security initiatives. The panel also has jurisdiction over two dozen key agencies and programs that have a direct impact on Rhode Island, including:
– The U.S. Small Business Administration (SBA), which supports local entrepreneurs and small businesses with outreach and loans and also provides loans following federally-declared disasters.
– The Federal Trade Commission (FTC), which helps ensure competition in broad sectors of the economy and helps protect consumers from false advertising and business practices.
– The Federal Communications Commission (FCC), which has jurisdiction over telecommunications and broadband matters.
– The Office of National Drug Control Policy (ONDCP), which provides funding for High Intensity Drug Trafficking Areas nationwide and to Rhode Island.
– The Federal Election Commission (FEC), with has jurisdiction over federal campaign finance laws.
– The General Services Administration (GSA), which manages federal properties in Rhode Island and nationwide.
– The Community Development Financial Institutions (CDFI) Fund which provides hundreds of millions annually to generate economic growth in local communities and provide access to credit and technical assistance to underserved areas.
Additionally, Senator Reed will serve on five other Appropriations Subcommittees: Commerce, Justice, Science, and Related Agencies (CJS); Defense; Labor, Health and Human Services, Education, and Related Agencies (Labor-H); Military Construction, Veterans Affairs, and Related Agencies (MilCon-VA); and Transportation, Housing, and Urban Development (THUD).
BANKING, HOUSING & URBAN AFFAIRS
A champion of affordable housing, consumer protection, and mass-transit, Senator Reed will continue serving as a key member of the Banking, Housing & Urban Affairs Committee, which has broad oversight over our nation’s financial institutions, capital markets, consumer finance, monetary policy, and housing and mass-transit programs.
Senator Reed is the most senior Democratic member of the panel, but Senate rules dictate that members may only serve atop one full committee at a time.
Senator Reed has used his Banking Committee post to author Wall Street reform and consumer protection laws, including his ‘warrants law,’ which forced the return of over $10 billion dollars to taxpayers. He also successfully urged the U.S. Securities and Exchange Commission (SEC) to focus greater attention on climate risk disclosures for public companies. The committee also oversees federal housing policy and authorizes mass-transit investments, and Senator Reed used his role on the committee led to create two affordable housing funds: the Housing Trust Fund and the Capital Magnet Fund.
It was Senator Reed’s leadership on the Banking, Housing, and Urban Affairs Committee, coupled with his work on the Appropriations Committee, that earned him a spot as one of twenty members of the bipartisan working group that was tasked with developing the CARES Act (Public Law No. 116-136). Senator Reed was the driving force behind the successful effort to create the $150 billion Coronavirus Relief Fund (CRF) in the CARES Act and successfully secured a small state minimum of $1.25 billion in the law. Senator Reed continues to play an active role in pushing legislation to direct additional federal funds to states and local governments to help save lives and address the economic impact caused by the pandemic.
As America faces an affordable housing crisis, which worsened during the pandemic, Senator Reed will play a key role in providing relief for renters and homeowners, and helping to revitalize communities by expanding the supply of affordable housing. Reed will also use his seat on this committee to boost mass-transit infrastructure in order to help connect communities and more Americans to jobs and economic opportunity.
Senator Reed will serve on three key Banking subcommittees: Economic Policy; Financial Institutions and Consumer Protection; and Securities, Insurance, and Investment.
INTELLIGENCE COMMITTEE
By virtue of his leadership of the Senate Armed Services Committee, Reed is also an ex officio member of the high-profile Senate Select Committee on Intelligence, which oversees the U.S. Intelligence Community. As an ex officio member of the panel, Senator Reed regularly participates in open and closed-door briefings and hearings with top intelligence officials from the Office of the Director of National Intelligence (ODNI), the Central Intelligence Agency (CIA), the Defense Intelligence Agency (DIA), and the National Security Agency (NSA), but he does not vote in committee.
The Intelligence Committee was established in 1976 to oversee the range of civilian and military agencies and departments that make up the U.S. Intelligence Community, and has wide influence over U.S. national security and foreign policy.
The President of the United States is required by law to ensure that the Intelligence Committee is kept “fully and currently informed” of intelligence activities. As a result, U.S. intelligence agencies must notify the Committee of its activities, including covert actions.

MIL OSI USA News –

January 30, 2025

MIL-OSI Security: Union County Man Sentenced To 57 Months In Prison For Stolen Vehicles Conspiracy

Source: Office of United States Attorneys

NEWARK, N.J. – A Union County, New Jersey man was sentenced to 57 months in prison for his role in a conspiracy to receive, retitle, and “re-VIN” stolen vehicles, Acting U.S. Attorney Vikas Khanna announced.

Nathaniel Bell, 27, of Linden, New Jersey, previously pleaded guilty before Senior U.S. District Judge Stanley R. Chesler to a seven-count information charging him with one count of conspiracy to receive stolen vehicles, five counts of altering or removing motor vehicle identification numbers (VINs) and one count of transportation of stolen vehicles.

According to documents filed in this case and statements made in court:

Bell was the leader of a criminal conspiracy that obtained stolen vehicles from New Jersey, New York, Florida, and other states, obtained fraudulent titles for the stolen vehicles, and altered vehicle identification numbers to conceal the fact that the vehicles were stolen. Bell and his co-conspirators then sold the stolen cars to dealerships or individual purchasers so they could make a profit. In at least two instances, the co-conspirators sold a stolen car to an individual purchaser and then stole it back so they could sell it again. Bell also knowingly altered or removed the VIN numbers on five vehicles and knowingly transported a stolen vehicle between New York and New Jersey.

In addition to the prison term, Judge Chesler sentenced Bell to three years of supervised release and ordered him to pay restitution.

Bell’s co-conspirators, Johnathan Tanksley, 31, of Orange; L’Hubermane Felix, 25, of Miami, Florida; and Dayanna Sarango-Hidalgo, 29, of Newark, have all pleaded guilty to conspiracy to receive stolen vehicles. Felix was previously sentenced to 24 months in prison. Tanksley and Sarango-Hidalgo await sentencing.

Acting U.S. Attorney Khanna credited special agents of the FBI, under the direction of Acting Special Agent in Charge Terence G. Reilly in Newark, with the investigation that led to the sentencing. He also thanked the New Jersey State Police Auto Theft Task Force; the Port Authority of New York and New Jersey; the New Jersey Motor Vehicle Commission; the Union County Prosecutor’s Office; the National Insurance Crime Bureau; the Jersey City Police Department; the Belleville Police Department; the Rahway Police Department; the Linden Police Department; the Roselle Police Department; the Eatontown Police Department; the Freehold Police Department; the Elizabeth Police Department; the Miami Police Department (Florida); the Florida Highway Patrol; Florida Fish and Wildlife Conservation Commission; the Howard County Police Department (Maryland); the New York Police Department; the Nassau County Police Department (New York); the Georgia Department of Revenue; the New Jersey Division of Criminal Justice; the Deputy Attorney General’s Office; the FBI Miami Office; the FBI Cleveland Office; and the FBI Milwaukee Office

The government is represented by Assistant U.S. Attorney Lauren Kober of the Organized Crimes/Gangs Unit in Newark.

###

Defense counsel: Jason F. Orlando

MIL Security OSI –

January 30, 2025

MIL-OSI Security: Rochester Man Pleads Guilty for His Role in $250 Million Feeding Our Future Fraud Scheme

Source: Office of United States Attorneys

MINNEAPOLIS – A Rochester man pleaded guilty for his role in the $250 million fraud scheme that exploited a federally-funded child nutrition program during the COVID-19 pandemic, announced Acting U.S. Attorney Lisa D. Kirkpatrick.

According to court documents, from approximately October 2020 through January 2022, Sharmake Jama, 37, knowingly participated in a scheme to defraud a federal child nutrition program designed to provide free meals to children in need. Rather than feed children, the defendants took advantage of the COVID-19 pandemic—and the resulting program changes—to enrich themselves by fraudulently misappropriating millions of dollars in federal child nutrition program funds.

According to court documents, in September 2020, Jama and Aimee Bock applied for Jama’s Brava Restaurant to be enrolled in the Federal Child Nutrition Program under the sponsorship of Bock’s non-profit, Feeding Our Future. Jama enrolled in the Federal Child Nutrition Program after he first prepared application paperwork at the direction of Salim Said, the co-owner of Safari Restaurant in Minneapolis, which was another business involved in the scheme to defraud the food program.

From late 2020 through 2021, Jama and other conspirators claimed Brava Restaurant was serving approximately 2,000 to 3,000 daily breakfasts and lunches to children, for which they fraudulently claimed and received millions of dollars in federal child nutrition program funds. To accomplish his scheme, Jama and his co-conspirators submitted fake attendance rosters purporting to list the names of children who purportedly received their food at sites. These rosters were fraudulent in that the names on them were fake or did not correctly reflect the number of children that were fed.

According to his plea agreement entered today, Jama claimed Brava Restaurant had served more than 1.7 million meals in Rochester as part of the Federal Child Nutrition Program in a little over one year, a number substantially higher than the actual number of meals served. Based on these fraudulent claims, Feeding Our Future paid out over $5.3 million in federal child nutrition program reimbursements for meals purportedly served to children by the defendant and his co-conspirators. Jama knew his receipt of such funds was fraudulent because he and other conspirators intentionally submitted inflated meal counts. Jama’s Brava Restaurant ultimately received $4.3 million directly from Feeding Our Future and over $900,000 from Safari Restaurant, co-owned by Salim Said.

As part of their scheme, Jama and his conspirators coordinated the establishment of shell companies through which they received and dispersed funds from the federal child nutrition program. Specifically, on January 7, 2021, Salim Said paid to register six different shell companies with the state of Minnesota for Jama and others. Salim Said paid to register Mumu LLC for Jama. In 2021, Jama deposited at least $872,230—almost all of which was misappropriated Federal Child Nutrition Program funds—into his Mumu LLC bank accounts.

Jama used federal child nutrition funds to pay for personal expenditures unrelated to feeding children, including at least $88,000 for a 2021 GMC Sierra 3500 Denali 4WD Crew Cab truck and over $500,000 toward real estate in Rochester, Minnesota, and Rosemount, Minnesota.

Jama pleaded guilty today in U.S. District Court before Chief Judge Patrick J. Schiltz to one count of wire fraud and one count of money laundering. His sentencing hearing will be scheduled at a later date.

The case is the result of an investigation by the FBI, IRS – Criminal Investigations, and the U.S. Postal Inspection Service.

Assistant U.S. Attorneys Matthew S. Ebert, Joseph H. Thompson, and Harry M. Jacobs are prosecuting the case. Assistant U.S. Attorney Craig Baune is handling the seizure and forfeiture of assets.

MIL Security OSI –

January 30, 2025

MIL-OSI USA: The Cowsert Column: Week Two Under the Gold Dome

Source: US State of Georgia

By: Sen. Bill Cowsert (R–Athens)

The second week of the legislative session is commonly referred to as “Budget Week” at the State Capitol. The budget process begins with Gov. Brian Kemp presenting a proposed budget for consideration by the General Assembly. This year’s budget proposal is presented in a printed report of 390 pages, which is just the increases to the 2025 budget. Various agencies present budget requests during joint Senate and House Appropriations Committee meetings. The House then passes an appropriations bill setting forth governmental spending for the upcoming year. Finally, the Senate makes its changes and the differences are worked out by a joint conference committee and the final version is sent to the Governor for his signature. The General Assembly’s most important endeavor is passing a balanced, commonsense budget, addressing the needs of Georgia citizens each year. In fact, the only bill which the General Assembly is required to pass each year is the annual appropriations bill.

Over the past 15 years, Georgia’s state budget has experienced steady growth, reflecting the state’s expanding economy and increasing demands for public services. In Fiscal Year (FY) 2010, Georgia’s budget was approximately $17.4 billion during the heart of the Great Recession. Fast forward to FY 2026, and that figure has more than doubled to $37.71 billion. In addition, approximately $22.46 billion in federal funds are included in Georgia’s 2026 budget.

Without going into extensive detail, the Governor proposes spending 20.33 billion (53.9%) on education, 8.76 billion (23.2%) on healthcare, 3.05 billion (8.1%) on public safety and 2.78 billion (7.4%) on transportation. This leaves only $2.79 billion (7.4%) for all other areas of government spending.

A key factor in Georgia’s economic stability is our unwavering commitment to maintaining a balanced budget. Unlike the federal government, which has spent both recklessly and unapologetically, Georgia is constitutionally required to balance its budget every year. This requirement ensures that the state lives within its means, preventing excessive debt accumulation and promoting long-term financial health for all citizens. Maintaining a balanced budget encourages responsible spending, requiring lawmakers to prioritize essential services and eliminate wasteful expenditures. It also enhances Georgia’s credit rating, allowing us to finance large-scale projects at lower interest rates, saving taxpayers money in the long run. Perhaps most importantly, a balanced budget fosters public confidence in our state’s financial management, reinforcing Georgia’s reputation as a great place to live, work and raise a family. By adhering to a balanced budget and prioritizing critical investments, we continue to build a prosperous future for all Georgians.

Thanks to our responsible fiscal management, Georgia has built a robust Revenue Shortfall Reserve (RSR), commonly known as the “rainy day fund.” The reserve was depleted to less than $50 million during the great recession, however, By FY 2023, the reserve had reached its statutory cap of 15% of the prior year’s revenue, totaling $5.4 billion. This financial cushion allows the state to weather economic downturns without resorting to drastic spending cuts or tax increases, ensuring continuity in essential public services. In addition, Georgia has over $11 billion in additional undesignated reserves over and above the funds held in the rainy day fund. There is really no authority for the State to accumulate taxpayer funds above the amounts needed to fund basic state needs. Fortunately, Gov. Kemp and the legislature have refunded at least $1 billion per year to taxpayers and significantly reduced taxes in response to our financial good fortune.

It’s important to highlight the stark contrast in spending at the federal level due to the Biden administration’s recent mismanagement of funds. Unfortunately, both political parties are guilty of irresponsible budgeting at the federal level. In fact, the last time that the federal budget was balanced was in the early 1990s when Bill Clinton was President and John Kasich was Chairman of the Appropriations Committee in the United States House. As of 2024, our national debt exceeded $35 trillion, with annual budget deficits contributing over $1 trillion annually to this growing burden. Persistent federal deficits pose risks such as higher interest rates, reduced national savings and potential economic uncertainty for future generations. These misguided spending practices have led our country down a dangerous path. Calls are growing for a constitutional amendment requiring the federal government to pass a balanced budget just like Georgia and almost all other states must do.

It is a privilege and an honor to serve the people of the 46^th Senate District. As always, don’t hesitate to contact my office with any legislative concerns. I hope to see you under the Gold Dome soon.

# # # #

Sen. Bill Cowsert serves as Chairman of the Senate Committee on Regulated Industries and Utilities. He represents the 46^th Senate District which includes portions of Barrow, Clarke, Gwinnett, Oconee and Walton Counties. He may be reached at (404) 463-1366 or via email at bill.cowsert@senate.ga.gov

For all media inquiries, please reach out to SenatePressInquiries@senate.ga.gov.

MIL OSI USA News –

January 30, 2025

MIL-OSI: Hampton Financial Corporation Announces 1st Quarter Results

Source: GlobeNewswire (MIL-OSI)

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

TORONTO, Jan. 29, 2025 (GLOBE NEWSWIRE) — Hampton Financial Corporation (“Hampton” or the “Company”, TSXV:HFC) today announced its financial results for the 1^st quarter ended November 30th, 2024.

First Quarter ended November 30^th, 2024.

IFRS results highlights:

Q1 Revenue of $3,133,000; an increase of 80% year-over-year
Q1 Net Loss of $(799,000) or $(0.01) per share;

Fiscal results (IFRS results adjusted for non-cash Items) highlights:

Q1 Adjusted Net Loss of $(505,000) or $(0.01) per share;
Q1 EBITDA of $240,000 vs $(249,000) in the comparative quarter last year

Summary of Corporate Developments:

Our 1^st quarter results reflect the continued challenging environment across the Capital markets industry. Rising interest rates and global uncertainty continue to delay many corporate finance and broader financial decisions on the part of issuers. While 2025 is showing some signs of improvement, the year ahead for our core business remains unclear. That said we intend to move ahead with a number of initiatives to further expand our business portfolio, while growing our existing Wealth Management prorate and Capital Markets businesses. Our acquisition of Oxygen Working Capital in early 2024 has been integrated and we continue to explore opportunities to expand the landing book.

“The first quarter results continue to demonstrate the industry-wide challenges faced during the fall of 2024. Capital Markets activities have started to improve as interest rates have stabilized, so we are hopeful for a stronger second half of the year. We remain optimistic for the balance of the fiscal year,” said Hampton Executive Chairman & CEO Peter Deeb.

Copies of Hampton’s unaudited interim financial statements and its Management’s Discussion & Analysis for the three months ended November 30, 2024, can be accessed on SEDAR+ at www.sedar.com.

About Hampton Financial Corporation

Hampton is a unique private equity firm that seeks to build shareholder value through long-term strategic investments.

Through its wholly-owned subsidiary, Hampton Securities Limited (“HSL”), Hampton is actively engaged in family office, wealth management, institutional services and capital markets activities. HSL is a full-service investment dealer, regulated by CIRO and registered in Alberta, British Columbia, Manitoba, Saskatchewan, Nova Scotia, Northwest Territories, Ontario, and Quebec. In addition, the Company, through HSL, provides investment banking services, which include assisting companies with raising capital, advising on mergers and acquisitions, and aiding issuers in obtaining a listing on recognized securities exchanges in Canada and abroad and HSL’s Corporate Finance Group provides early stage, growing companies the capital, they need to create value for investors. HSL continues to develop its Wealth Management, Advisory Team and Principal-Agent programs which offers to the industry’s most experienced wealth managers a unique and flexible operating platform that provides additional freedom, financial support, and tax effectiveness as they build and manage their professional practice.

Through its wholly-owned subsidiary, Oxygen Working Capital (“OWC”) the company offers factoring and other commercial financing services to clients across Canada.

The Company is exploring opportunities to diversify its sources of revenue by way of strategic investments in both complimentary business and non-core sectors that can leverage the expertise of its Board and the diverse experience of its management team.

For more information, please contact:

Olga Juravlev
Chief Financial Officer
Hampton Financial Corporation
(416) 862-8701

Or

Peter M. Deeb
Executive Chairman & CEO
Hampton Financial Corporation
(416) 862-8651

The TSXV has in no way approved nor disapproved the contents of this press release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this press release.

No securities regulatory authority has either approved or disapproved of the contents of this press release. This press release does not constitute or form a part of any offer or solicitation to buy or sell any securities in the United States or any other jurisdiction outside of Canada. The securities being offered have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or the securities laws of any state of the United States and may not be offered or sold within the United States or to a U.S. person absent registration or pursuant to an available exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. There will be no public offering of securities in the United States.

Forward-Looking Statements

This press release contains certain forward-looking statements and forward-looking information (collectively referred to herein as “forward-looking statements”) within the meaning of applicable Canadian securities laws, which may include, but are not limited to, information and statements regarding or inferring the future business, operations, financial performance, prospects, and other plans, intentions, expectations, estimates, and beliefs of the Company. All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “should”, “hopeful”, “recovery”, “anticipate”, “achieve”, “could”, “believe”, “plan”, “intend”, “objective”, “continuous”, “ongoing”, “estimate”, “outlook”, “expect”, “may”, “will”, “project” or similar words, including negatives thereof, suggesting future outcomes.

Forward-looking statements involve and are subject to assumptions and known and unknown risks, uncertainties, and other factors beyond the Company’s ability to predict or control which may cause actual events, results, performance, or achievements of the Company to be materially different from future events, results, performance, and achievements expressed or implied by forward-looking statements herein. Forward-looking statements are not a guarantee of future performance. Although the Company believes that any forward-looking statements herein are reasonable, in light of the use of assumptions and the significant risks and uncertainties inherent in such statements, there can be no assurance that any such forward-looking statements will prove to be accurate. Actual results may vary, and vary materially, from those expressed or implied by the forward-looking statements herein. Accordingly, readers are advised to rely on their own evaluation of the risks and uncertainties inherent in forward-looking statements herein and should not place undue reliance upon such forward-looking statements. All forward-looking statements herein are qualified by this cautionary statement. Any forward-looking statements herein are made only as of the date hereof, and except as required by applicable laws, the Company assumes no obligation and disclaims any intention to update or revise any forward-looking statements herein or to update the reasons that actual events or results could or do differ from those projected in any forward-looking statements herein, whether as a result of new information, future events or results, or otherwise, except as required by applicable laws.

The MIL Network –

January 30, 2025

MIL-OSI Security: Federal Grand Jury Indicts Man for Allegedly Attempting To Extort Money From Chicago Restaurateur

Source: Office of United States Attorneys

CHICAGO — A federal grand jury has indicted a man for allegedly threatening and assaulting a Chicago restaurateur to collect a debt the man claimed he was owed.

An indictment returned Monday in U.S. District Court in Chicago charges JAWAD FAKROUNE, also known as “Angelino Escobar” or “Anjelino Escobar,” 45, of Morocco, with extortion. Arraignment is scheduled for Feb. 5, 2025, at 10:30 a.m., before U.S. District Judge Manish S. Shah.

In 2023 and 2024, Fakroune privately loaned approximately $405,000 to the restaurateur to start a new restaurant in the Lincoln Park neighborhood of Chicago, according to a criminal complaint previously filed in the case. The restaurateur repaid a portion of the loan, but in November 2024 Fakroune and the restaurateur engaged in a dispute regarding the amount of money still owed, the complaint states. On the evening of Nov. 25, 2024, Fakroune went to the restaurant, threatened the restaurateur over the manner and nature of the repayments, and claimed that $1.5 million was still owed, the complaint states. Fakroune then choked, kicked, and punched the restaurateur, while continuing to demand money and threatening the restaurateur’s life and the lives of his family members, the complaint states.

The indictment was announced by Morris Pasqual, Acting United States Attorney for the Northern District of Illinois, Douglas S. DePodesta, Special Agent-in-Charge of the Chicago Field Office of the FBI, and Ramsey E. Covington, Acting Special Agent-in-Charge of IRS Criminal Investigation Chicago Field Office. The government is represented by Assistant U.S. Attorneys Sean Hennessy and Richard M. Rothblatt.

The public is reminded that an indictment is not evidence of guilt. The defendant is presumed innocent and entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.

MIL Security OSI –

January 30, 2025

MIL-OSI: National Fuel Reports First Quarter Earnings

Source: GlobeNewswire (MIL-OSI)

WILLIAMSVILLE, N.Y., Jan. 29, 2025 (GLOBE NEWSWIRE) — National Fuel Gas Company (“National Fuel” or the “Company”) (NYSE:NFG) today announced consolidated results for the first quarter of its 2025 fiscal year.

FISCAL 2025 FIRST QUARTER SUMMARY

GAAP net income of $45.0 million (or $0.49 per share), which includes $104.6 million in non-cash, after-tax impairment charges in the Exploration & Production segment, compared to GAAP net income of $133.0 million (or $1.44 per share) in the prior year.
Adjusted operating results of $151.9 million (or $1.66 per share), an increase of 14%, or $16.7 million ($0.20 per share), compared to the prior year. See non-GAAP reconciliation on page 2.
Pipeline & Storage segment net income increased $8.4 million, or 35%, compared to the prior year, primarily due to the settlement of the Supply Corporation rate case, which led to increased rates effective February 1, 2024.
Utility segment net income increased $5.9 million, or 22%, compared to the prior year driven by a three-year settlement of a rate proceeding in the Company’s New York jurisdiction, which led to increased rates starting October 1, 2024.
E&P segment adjusted operating results increased $2.6 million, or 5%, compared to the prior year, supported by hedging-related gains, which more than offset the $0.08 per MMBtu decrease in the weighted average natural gas price compared to the prior year.
The Company repurchased $34 million of common stock during the quarter, which brings the total amount repurchased to $99 million, or 1.7 million shares, under the $200 million share buyback program, authorized in March 2024.
The Company is increasing its guidance for fiscal 2025 adjusted earnings per share to a range of $6.50 to $7.00 as a result of higher forecasted natural gas prices and ongoing improvements in the outlook for each segment.

MANAGEMENT COMMENTS

David P. Bauer, President and CEO of National Fuel Gas Company, stated: “Fiscal 2025 is off to a great start for National Fuel, with each business contributing to our strong consolidated adjusted operating results.

“In our regulated segments, we are delivering on our long-term growth outlook, with adjusted earnings per share in the quarter increasing approximately 30% compared to the prior year. The recent approval of our rate case settlement in our New York utility jurisdiction, which extends through 2027, combined with the ongoing benefits from ratemaking activity in our Pennsylvania utility territory and at Supply Corporation, gives us further confidence in our 7% to 10% earnings growth projections over the next three years. Furthermore, our integrated upstream and gathering operations in the Eastern Development Area (“EDA”) continue to exceed expectations, with the combination of strong operational execution and our highly-prolific assets. This differentiated ability to drive capital efficiency improvements alongside a rising price outlook for natural gas positions these businesses to deliver strong results in the coming years. We expect that these tailwinds will contribute to rising free cash flow across the system and deliver significant value to National Fuel shareholders.”

RECONCILIATION OF GAAP EARNINGS TO ADJUSTED OPERATING RESULTS


	Three Months Ended
	December 31,
(in thousands except per share amounts)	2024			2023
Reported GAAP Earnings	$	44,986		$	133,020
Items impacting comparability:
Impairment of assets (E&P)		141,802			—
Tax impact of impairment of assets		(37,169	)		—
Unrealized (gain) loss on derivative asset (E&P)		349			4,198
Tax impact of unrealized (gain) loss on derivative asset		(94	)		(1,151	)
Unrealized (gain) loss on other investments (Corporate / All Other)		2,617			(1,049	)
Tax impact of unrealized (gain) loss on other investments		(550	)		220
Adjusted Operating Results	$	151,941		$	135,238

Reported GAAP Earnings Per Share	$	0.49		$	1.44
Items impacting comparability:
Impairment of assets, net of tax (E&P)		1.14			—
Unrealized (gain) loss on derivative asset, net of tax (E&P)		—			0.03
Unrealized (gain) loss on other investments, net of tax (Corporate / All Other)		0.02			(0.01	)
Rounding		0.01			—
Adjusted Operating Results Per Share	$	1.66		$	1.46

FISCAL 2025 GUIDANCE UPDATE

National Fuel is increasing its guidance for fiscal 2025 adjusted earnings per share, which are now expected to be within a range of $6.50 to $7.00. This updated range incorporates better than expected results in the first quarter along with the anticipated impact of higher natural gas prices and higher production in the Exploration and Production segment for the remainder of the fiscal year. The Company is now assuming NYMEX natural gas prices will average $3.50 per MMBtu for the remaining nine months of fiscal 2025, an increase of $0.70 from the $2.80 per MMBtu assumed in previous guidance. This updated natural gas price projection approximates the current NYMEX forward curve at this time, however; given the continued volatility in NYMEX natural gas prices, the Company is providing the following sensitivities to its adjusted operating results guidance range:

NYMEX Assumption *Remaining 9 months* ($/MMBtu)		Fiscal 2025 Adjusted Earnings Per Share Sensitivities
$3.00		$6.15 – $6.65
$3.50		$6.50 – $7.00
$4.00		$6.90 – $7.40

The Company’s production guidance for fiscal 2025 is now expected to be in the range of 410 to 425 Bcfe, an increase of 7.5 Bcfe, or 2%, at the midpoint compared to previous guidance. The revised production guidance is principally a result of ongoing improvements in Seneca’s well results and additional operational efficiencies in the highly prolific EDA. This is also expected to result in increased Gathering segment revenue, relative to the Company’s prior projections, and as a result the Company has increased the midpoint of its guidance range by $5 million. While the Company’s guidance does not incorporate any future price-related curtailments, with 87% of its projected fiscal 2025 production linked to firm sales contracts, Seneca has limited exposure to in-basin markets. Further, 71% of expected production for the balance of the fiscal year is either matched by a financial hedge, including a combination of swaps and no-cost collars, or was entered into at a fixed price, both of which provide price certainty for that production.

Additionally, as a result of operational improvements, the Company is revising Seneca’s capital expenditure guidance range downward to $495 million to $515 million, or $505 million at the midpoint, which is a $5 million decrease from the midpoint of the Company’s previous guidance.

The Company’s other fiscal 2025 guidance assumptions remain largely unchanged and are detailed in the table on page 7.

DISCUSSION OF FIRST QUARTER RESULTS BY SEGMENT

The following earnings discussion of each operating segment for the quarter ended December 31, 2024 is summarized in a tabular form on pages 8 and 9 of this report. It may be helpful to refer to those tables while reviewing this discussion.

Note that management defines adjusted operating results as reported GAAP earnings adjusted for items impacting comparability, and adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability.

Upstream Business

Exploration and Production Segment

The Exploration and Production segment operations are carried out by Seneca Resources Company, LLC (“Seneca”). Seneca explores for, develops and produces primarily natural gas reserves in Pennsylvania.

	Three Months Ended
	December 31,
(in thousands)	2024			2023		Variance
GAAP Earnings	$	(46,777	)	$	52,483	$	(99,260	)
Impairment of assets, net of tax		104,633			—		104,633
Unrealized (gain) loss on derivative asset, net of tax		255			3,047		(2,792	)
Adjusted Operating Results	$	58,111		$	55,530	$	2,581

Adjusted EBITDA	$	156,645		$	159,970	$	(3,325	)

Seneca’s first quarter GAAP earnings decreased $99.3 million versus the prior year. This was driven by non-cash, pre-tax impairment charges of $141.8 million ($104.6 million after-tax), the majority of which is related to a “ceiling test” impairment which required Seneca to write-down the book value of its reserves under the full cost method of accounting. For purposes of the ceiling test, the 12-month average of first day of the month pricing for NYMEX natural gas for the period ended December 31, 2024 was $2.13 per MMBtu.

Excluding impairments, as well as the net impact of unrealized losses related to reductions in the fair value of contingent consideration received in connection with the June 2022 divestiture of Seneca’s California assets (see table above), Seneca’s adjusted operating results increased $2.6 million primarily due to higher realized natural gas prices after the impact of hedging and lower per unit operating expenses, partially offset by lower natural gas production.

During the first quarter, Seneca produced 97.7 Bcf of natural gas, a decrease of 3.0 Bcf, or 3%, from the prior year. Compared to the preceding fourth quarter of fiscal 2024, production in the first quarter is higher by 5.8 Bcf, or 6%. Early in the quarter, Seneca curtailed approximately 1 Bcf of production due to low in-basin pricing. Production in the quarter was lower than the prior year largely due to the timing of turn in line dates for new wells between fiscal years.

Seneca’s average realized natural gas price, after the impact of hedging and transportation costs, was $2.53 per Mcf, an increase of $0.02 per Mcf from the prior year. Seneca recorded hedging gains of $29.7 million, or an uplift of $0.30 per Mcf, during the quarter, which more than offset a $0.08 per Mcf decrease in pre-hedge natural gas price realizations versus the prior year.

On a per unit basis, first quarter Lease Operating Expense (“LOE”) was $0.67 per Mcf, consistent with the prior year. LOE included $55.0 million ($0.56 per Mcf) for gathering and compression services from the Company’s Gathering segment to connect Seneca’s production to sales points along interstate pipelines. General and Administrative Expense (“G&A”) was $0.20 per Mcf, an increase of $0.02 per Mcf compared to the prior year driven by the combination of higher personnel costs and modestly lower production. Depreciation, Depletion and Amortization Expense (“DD&A”) was $0.65 per Mcf, a decrease of $0.06 per Mcf from the prior year largely due to ceiling test impairments recorded in the third and fourth quarters of fiscal 2024 that lowered Seneca’s full cost pool depletable base.

Midstream Businesses

Pipeline and Storage Segment

The Pipeline and Storage segment’s operations are carried out by National Fuel Gas Supply Corporation (“Supply Corporation”) and Empire Pipeline, Inc. (“Empire”). The Pipeline and Storage segment provides natural gas transportation and storage services to affiliated and non-affiliated companies through an integrated system of pipelines and underground natural gas storage fields in western New York and Pennsylvania.

	Three Months Ended
	December 31,
(in thousands)	2024		2023		Variance
GAAP Earnings	$	32,454	$	24,055	$	8,399

Adjusted EBITDA	$	70,953	$	59,142	$	11,811

The Pipeline and Storage segment’s first quarter GAAP earnings increased $8.4 million versus the prior year primarily due to higher operating revenues, partly offset by higher operation and maintenance (“O&M”) expense.

The increase in operating revenues of $12.2 million, or 13%, was primarily attributable to an increase in Supply Corporation’s transportation and storage rates effective February 1, 2024, in accordance with its rate settlement, which was approved in fiscal 2024. O&M expense increased $1.1 million primarily due to higher pipeline integrity and labor-related costs.

Gathering Segment

The Gathering segment’s operations are carried out by National Fuel Gas Midstream Company, LLC’s limited liability companies. The Gathering segment constructs, owns and operates natural gas gathering pipelines and compression facilities in the Appalachian region, which delivers Seneca and other non-affiliated Appalachian production to the interstate pipeline system.

	Three Months Ended
	December 31,
(in thousands)	2024		2023		Variance
GAAP Earnings	$	27,145	$	28,825	$	(1,680	)

Adjusted EBITDA	$	51,936	$	53,061	$	(1,125	)

The Gathering segment’s first quarter GAAP earnings decreased $1.7 million versus the prior year due to lower operating revenues and higher DD&A expense.

Operating revenues decreased $1.5 million, or 2%, primarily due to a decrease in throughput from Seneca. DD&A expense increased $1.1 million primarily due to higher average depreciable plant in service compared to the prior year.

Downstream Business

Utility Segment

The Utility segment operations are carried out by National Fuel Gas Distribution Corporation (“Distribution Corporation”), which sells or transports natural gas to customers located in western New York and northwestern Pennsylvania.

	Three Months Ended
	December 31,
(in thousands)	2024		2023		Variance
GAAP Earnings	$	32,499	$	26,551	$	5,948

Adjusted EBITDA	$	60,665	$	53,366	$	7,299

The Utility segment’s first quarter GAAP earnings increased $5.9 million, or 22%, primarily as a result of the implementation of the recent rate case order in the Utility’s New York jurisdiction.

For the quarter, customer margin (operating revenues less purchased gas sold) increased $9.1 million, primarily due to the aforementioned rate case in Distribution Corporation’s New York jurisdiction, for which a settlement became effective October 1, 2024. Other income, which was also impacted by the rate settlement, increased $4.0 million. This was in large part due to the recognition of non-service pension and post-retirement benefit income that is offset with a corresponding reduction in new base rates and as a result, has no effect on net income.

O&M expense increased by $1.6 million, primarily driven by higher personnel costs, partially offset by a reduction related to amortizations of certain regulatory assets as a result of the New York rate settlement. DD&A expense increased $0.8 million primarily due to higher average depreciable plant in service compared to the prior year. Interest expense increased $2.3 million primarily due to a higher average amount of net borrowings.

Corporate and All Other

The Company’s operations that are included in Corporate and All Other generated a combined net loss of $0.3 million in the current-year first quarter, which was $1.4 million lower than combined earnings of $1.1 million in the prior-year first quarter. The reduction in earnings during the quarter was primarily driven by unrealized losses recorded on investment securities that fund non-qualified retirement benefit plans.

EARNINGS TELECONFERENCE

A conference call to discuss the results will be held on Thursday, January 30, 2025, at 9 a.m. ET. All participants must pre-register to join this conference using the Participant Registration link. A webcast link to the conference call will be provided under the Events Calendar on the NFG Investor Relations website at investor.nationalfuelgas.com. A replay will be available following the call through the end of the day, Thursday, February 6, 2025. To access the replay, dial 1-866-813-9403 and provide Access Code 245940.

National Fuel is an integrated energy company reporting financial results for four operating segments: Exploration and Production, Pipeline and Storage, Gathering, and Utility. Additional information about National Fuel is available at www.nationalfuel.com.

Certain statements contained herein, including statements identified by the use of the words “anticipates,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,” “may” and similar expressions, and statements which are other than statements of historical facts, are “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties, which could cause actual results or outcomes to differ materially from those expressed in the forward-looking statements. The Company’s expectations, beliefs and projections contained herein are expressed in good faith and are believed to have a reasonable basis, but there can be no assurance that such expectations, beliefs or projections will result or be achieved or accomplished. In addition to other factors, the following are important factors that could cause actual results to differ materially from those discussed in the forward-looking statements: impairments under the SEC’s full cost ceiling test for natural gas reserves; changes in the price of natural gas; changes in laws, regulations or judicial interpretations to which the Company is subject, including those involving derivatives, taxes, safety, employment, climate change, other environmental matters, real property, and exploration and production activities such as hydraulic fracturing; governmental/regulatory actions, initiatives and proceedings, including those involving rate cases (which address, among other things, target rates of return, rate design, retained natural gas and system modernization), environmental/safety requirements, affiliate relationships, industry structure, and franchise renewal; the Company’s ability to estimate accurately the time and resources necessary to meet emissions targets; governmental/regulatory actions and/or market pressures to reduce or eliminate reliance on natural gas; changes in economic conditions, including inflationary pressures, supply chain issues, liquidity challenges, and global, national or regional recessions, and their effect on the demand for, and customers’ ability to pay for, the Company’s products and services; the creditworthiness or performance of the Company’s key suppliers, customers and counterparties; financial and economic conditions, including the availability of credit, and occurrences affecting the Company’s ability to obtain financing on acceptable terms for working capital, capital expenditures and other investments, including any downgrades in the Company’s credit ratings and changes in interest rates and other capital market conditions; changes in price differentials between similar quantities of natural gas sold at different geographic locations, and the effect of such changes on commodity production, revenues and demand for pipeline transportation capacity to or from such locations; the impact of information technology disruptions, cybersecurity or data security breaches; factors affecting the Company’s ability to successfully identify, drill for and produce economically viable natural gas reserves, including among others geology, lease availability and costs, title disputes, weather conditions, water availability and disposal or recycling opportunities of used water, shortages, delays or unavailability of equipment and services required in drilling operations, insufficient gathering, processing and transportation capacity, the need to obtain governmental approvals and permits, and compliance with environmental laws and regulations; the Company’s ability to complete strategic transactions; increased costs or delays or changes in plans with respect to Company projects or related projects of other companies, as well as difficulties or delays in obtaining necessary governmental approvals, permits or orders or in obtaining the cooperation of interconnecting facility operators; increasing health care costs and the resulting effect on health insurance premiums and on the obligation to provide other post-retirement benefits; other changes in price differentials between similar quantities of natural gas having different quality, heating value, hydrocarbon mix or delivery date; the cost and effects of legal and administrative claims against the Company or activist shareholder campaigns to effect changes at the Company; negotiations with the collective bargaining units representing the Company’s workforce, including potential work stoppages during negotiations; uncertainty of natural gas reserve estimates; significant differences between the Company’s projected and actual production levels for natural gas; changes in demographic patterns and weather conditions (including those related to climate change); changes in the availability, price or accounting treatment of derivative financial instruments; changes in laws, actuarial assumptions, the interest rate environment and the return on plan/trust assets related to the Company’s pension and other post-retirement benefits, which can affect future funding obligations and costs and plan liabilities; economic disruptions or uninsured losses resulting from major accidents, fires, severe weather, natural disasters, terrorist activities or acts of war, as well as economic and operational disruptions due to third-party outages; significant differences between the Company’s projected and actual capital expenditures and operating expenses; or increasing costs of insurance, changes in coverage and the ability to obtain insurance. The Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date thereof.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

GUIDANCE SUMMARY

As discussed on page 2, the Company is revising its adjusted earnings per share guidance for fiscal 2025. Additional details on the Company’s forecast assumptions and business segment guidance are outlined in the table below.

The revised adjusted earnings per share guidance range excludes certain items that impacted the comparability of adjusted operating results during the three months ended December 31, 2024, including: (1) the after tax impairment of assets, which reduced earnings by $1.14 per share; (2) after-tax unrealized losses on a derivative asset, which reduced earnings by less than $0.01 per share; and (3) after-tax unrealized losses on other investments, which reduced earnings by $0.02 per share. While the Company expects to record certain adjustments to unrealized gain or loss on a derivative asset and unrealized gain or loss on investments during the nine months ending September 30, 2025, the amounts of these and other potential adjustments and charges, including ceiling test impairments, are not reasonably determinable at this time. As such, the Company is unable to provide earnings guidance other than on a non-GAAP basis.

	Previous FY 2025 Guidance	Updated FY 2025 Guidance

Consolidated Adjusted Earnings per Share	$5.50 to $6.00	$6.50 to $7.00
Consolidated Effective Tax Rate	~ 24.5 – 25%	~ 25%

Capital Expenditures(Millions)
Exploration and Production	$495 – $525	$495 – $515
Pipeline and Storage	$130 – $150	$130 – $150
Gathering	$95 – $110	$95 – $110
Utility	$165 – $185	$165 – $185
Consolidated Capital Expenditures	$885 – $970	$885 – $960

Exploration and Production Segment Guidance

Commodity Price Assumptions*
NYMEX natural gas price	$2.80 /MMBtu	$3.50 /MMBtu
Appalachian basin spot price	$2.00 /MMBtu	$2.90 /MMBtu

Realized natural gas prices, after hedging ($/Mcf)	$2.47 – $2.51	$2.77 – $2.81

Production (Bcf)	400 to 420	410 to 425

E&P Operating Costs($/Mcf)
LOE	$0.68 – $0.70	$0.68 – $0.70
G&A	$0.18 – $0.19	$0.18 – $0.19
DD&A	$0.65 – $0.69	$0.63 – $0.67

Other Business Segment Guidance(Millions)
Gathering Segment Revenues	$245 – $255	$250 – $260
Pipeline and Storage Segment Revenues	$415 – $435	$415 – $435

* Commodity price assumptions are for the remaining nine months of the fiscal year.

NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
QUARTER ENDED DECEMBER 31, 2024
(Unaudited)

	Upstream			Midstream						Downstream

	Exploration &			Pipeline &									Corporate /
(Thousands of Dollars)	Production			Storage			Gathering			Utility			All Other			Consolidated*

First quarter 2024 GAAP earnings	$	52,483		$	24,055		$	28,825		$	26,551		$	1,106		$	133,020
Items impacting comparability:
Unrealized (gain) loss on derivative asset		4,198															4,198
Tax impact of unrealized (gain) loss on derivative asset		(1,151	)														(1,151	)
Unrealized (gain) loss on other investments														(1,049	)		(1,049	)
Tax impact of unrealized (gain) loss on other investments														220			220
First quarter 2024 adjusted operating results		55,530			24,055			28,825			26,551			277			135,238
Drivers of adjusted operating results**
Upstream Revenues
Higher (lower) natural gas production		(6,016	)														(6,016	)
Higher (lower) realized natural gas prices, after hedging		1,885															1,885
Midstream Revenues
Higher (lower) operating revenues					9,637			(1,151	)								8,486
Downstream Margins***
Impact of usage and weather											(325	)					(325	)
Impact of new rates in New York											7,865						7,865
Operating Expenses
Lower (higher) lease operating and transportation expenses		1,133															1,133
Lower (higher) operating expenses					(856	)					(1,244	)					(2,100	)
Lower (higher) depreciation / depletion		6,842						(835	)		(624	)					5,383
Other Income (Expense)
Higher (lower) other income		(1,680	)								3,176			1,686			3,182
(Higher) lower interest expense											(1,785	)					(1,785	)
Income Taxes
Lower (higher) income tax expense / effective tax rate		(8	)		(488	)		443			(584	)		205			(432	)
All other / rounding		425			106			(137	)		(531	)		(436	)		(573	)
First quarter 2025 adjusted operating results		58,111			32,454			27,145			32,499			1,732			151,941
Items impacting comparability:
Impairment of assets		(141,802	)														(141,802	)
Tax impact of impairment of assets		37,169															37,169
Unrealized gain (loss) on derivative asset		(349	)														(349	)
Tax impact of unrealized gain (loss) on derivative asset		94															94
Unrealized gain (loss) on other investments														(2,617	)		(2,617	)
Tax impact of unrealized gain (loss) on other investments														550			550
First quarter 2025 GAAP earnings	$	(46,777	)	$	32,454		$	27,145		$	32,499		$	(335	)	$	44,986

* Amounts do not reflect intercompany eliminations.
** Drivers of adjusted operating results have been calculated using the 21% federal statutory rate.
*** Downstream margin defined as operating revenues less purchased gas expense.

NATIONAL FUEL GAS COMPANY
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
QUARTER ENDED DECEMBER 31, 2024
(Unaudited)

	Upstream			Midstream						Downstream

	Exploration &			Pipeline &									Corporate /
	Production			Storage			Gathering			Utility			All Other			Consolidated*

First quarter 2024 GAAP earnings per share	$	0.57		$	0.26		$	0.31		$	0.29		$	0.01		$	1.44
Items impacting comparability:
Unrealized (gain) loss on derivative asset, net of tax		0.03															0.03
Unrealized (gain) loss on other investments, net of tax														(0.01	)		(0.01	)
First quarter 2024 adjusted operating results per share		0.60			0.26			0.31			0.29			—			1.46
Drivers of adjusted operating results**
Upstream Revenues
Higher (lower) natural gas production		(0.07	)														(0.07	)
Higher (lower) realized natural gas prices, after hedging		0.02															0.02
Midstream Revenues
Higher (lower) operating revenues					0.11			(0.01	)								0.10
Downstream Margins***
Impact of usage and weather											—						—
Impact of new rates in New York											0.09						0.09
Operating Expenses
Lower (higher) lease operating and transportation expenses		0.01															0.01
Lower (higher) operating expenses					(0.01	)					(0.01	)					(0.02	)
Lower (higher) depreciation / depletion		0.08						(0.01	)		(0.01	)					0.06
Other Income (Expense)
Higher (lower) other income		(0.02	)								0.03			0.02			0.03
(Higher) lower interest expense											(0.02	)					(0.02	)
Income Taxes
Lower (higher) income tax expense / effective tax rate		—			(0.01	)		—			(0.01	)		—			(0.02	)
All other / rounding		0.02			—			0.01			—			(0.01	)		0.02
First quarter 2025 adjusted operating results per share		0.64			0.35			0.30			0.36			0.01			1.66
Items impacting comparability:
Impairment of assets, net of tax		(1.14	)														(1.14	)
Unrealized gain (loss) on derivative asset, net of tax		—															—
Unrealized gain (loss) on other investments, net of tax														(0.02	)		(0.02	)
Rounding		(0.01	)														(0.01	)
First quarter 2025 GAAP earnings per share	$	(0.51	)	$	0.35		$	0.30		$	0.36		$	(0.01	)	$	0.49

* Amounts do not reflect intercompany eliminations.
** Drivers of adjusted operating results have been calculated using the 21% federal statutory rate.
*** Downstream margin defined as operating revenues less purchased gas expense.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

(Thousands of Dollars, except per share amounts)
	Three Months Ended
	December 31,
	(Unaudited)
SUMMARY OF OPERATIONS	2024			2023
Operating Revenues:
Utility Revenues	$	228,424		$	201,920
Exploration and Production and Other Revenues		248,860			254,019
Pipeline and Storage and Gathering Revenues		72,198			69,422
		549,482			525,361
Operating Expenses:
Purchased Gas		65,337			56,552
Operation and Maintenance:
Utility		55,244			53,705
Exploration and Production and Other		33,541			34,826
Pipeline and Storage and Gathering		35,941			34,962
Property, Franchise and Other Taxes		22,056			22,416
Depreciation, Depletion and Amortization		109,370			115,790
Impairment of Assets		141,802			—
		463,291			318,251

Operating Income		86,191			207,110

Other Income (Expense):
Other Income (Deductions)		7,720			3,732
Interest Expense on Long-Term Debt		(33,362	)		(28,462	)
Other Interest Expense		(4,381	)		(6,273	)

Income Before Income Taxes		56,168			176,107

Income Tax Expense		11,182			43,087

Net Income Available for Common Stock	$	44,986		$	133,020

Earnings Per Common Share
Basic	$	0.50		$	1.45
Diluted	$	0.49		$	1.44

Weighted Average Common Shares:
Used in Basic Calculation		90,777,446			91,910,244
Used in Diluted Calculation		91,434,741			92,442,145

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)

	December 31,			September 30,
(Thousands of Dollars)	2024			2024
ASSETS
Property, Plant and Equipment	$	14,675,281		$	14,524,798
Less – Accumulated Depreciation, Depletion and Amortization		7,393,477			7,185,593
Net Property, Plant and Equipment		7,281,804			7,339,205
Current Assets:
Cash and Temporary Cash Investments		48,694			38,222
Receivables – Net		202,821			127,222
Unbilled Revenue		57,117			15,521
Gas Stored Underground		24,725			35,055
Materials and Supplies – at average cost		47,820			47,670
Other Current Assets		83,435			92,229
Total Current Assets		464,612			355,919
Other Assets:
Recoverable Future Taxes		83,740			80,084
Unamortized Debt Expense		5,206			5,604
Other Regulatory Assets		106,386			108,022
Deferred Charges		68,952			69,662
Other Investments		71,493			81,705
Goodwill		5,476			5,476
Prepaid Pension and Post-Retirement Benefit Costs		185,224			180,230
Fair Value of Derivative Financial Instruments		20,695			87,905
Other		7,860			5,958
Total Other Assets		555,032			624,646
Total Assets	$	8,301,448		$	8,319,770
CAPITALIZATION AND LIABILITIES
Capitalization:
Comprehensive Shareholders’ Equity
Common Stock, $1 Par Value Authorized – 200,000,000 Shares; Issued and
Outstanding – 90,612,955 Shares and 91,005,993 Shares, Respectively	$	90,613		$	91,006
Paid in Capital		1,039,705			1,045,487
Earnings Reinvested in the Business		1,698,648			1,727,326
Accumulated Other Comprehensive Loss		(76,153	)		(15,476	)
Total Comprehensive Shareholders’ Equity		2,752,813			2,848,343
Long-Term Debt, Net of Current Portion and Unamortized Discount and Debt Issuance Costs		2,189,421			2,188,243
Total Capitalization		4,942,234			5,036,586
Current and Accrued Liabilities:
Notes Payable to Banks and Commercial Paper		200,000			90,700
Current Portion of Long-Term Debt		500,000			500,000
Accounts Payable		120,991			165,068
Amounts Payable to Customers		42,587			42,720
Dividends Payable		46,671			46,872
Interest Payable on Long-Term Debt		44,376			27,247
Customer Advances		15,295			19,373
Customer Security Deposits		36,091			36,265
Other Accruals and Current Liabilities		172,409			162,903
Fair Value of Derivative Financial Instruments		20,893			4,744
Total Current and Accrued Liabilities		1,199,313			1,095,892
Other Liabilities:
Deferred Income Taxes		1,089,394			1,111,165
Taxes Refundable to Customers		303,344			305,645
Cost of Removal Regulatory Liability		296,660			292,477
Other Regulatory Liabilities		147,561			151,452
Other Post-Retirement Liabilities		3,476			3,511
Asset Retirement Obligations		199,310			203,006
Other Liabilities		120,156			120,036
Total Other Liabilities		2,159,901			2,187,292
Commitments and Contingencies		—			—
Total Capitalization and Liabilities	$	8,301,448		$	8,319,770

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Three Months Ended
	December 31,
(Thousands of Dollars)	2024			2023

Operating Activities:
Net Income Available for Common Stock	$	44,986		$	133,020
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Impairment of Assets		141,802			—
Depreciation, Depletion and Amortization		109,370			115,790
Deferred Income Taxes		(5,385	)		38,362
Stock-Based Compensation		4,705			4,660
Other		7,146			8,041
Change in:
Receivables and Unbilled Revenue		(115,165	)		(58,459	)
Gas Stored Underground and Materials and Supplies		10,180			6,915
Other Current Assets		8,814			892
Accounts Payable		9,703			(3,355	)
Amounts Payable to Customers		(133	)		1,013
Customer Advances		(4,078	)		2,083
Customer Security Deposits		(174	)		2,079
Other Accruals and Current Liabilities		21,266			28,612
Other Assets		(3,892	)		(6,306	)
Other Liabilities		(9,057	)		(2,403	)
Net Cash Provided by Operating Activities	$	220,088		$	270,944

Investing Activities:
Capital Expenditures	$	(240,427	)	$	(246,938	)
Other		5,878			(920	)
Net Cash Used in Investing Activities	$	(234,549	)	$	(247,858	)

Financing Activities:
Changes in Notes Payable to Banks and Commercial Paper		109,300			12,500
Shares Repurchased Under Repurchase Plan		(33,524	)		—
Dividends Paid on Common Stock		(46,872	)		(45,451	)
Net Repurchases of Common Stock Under Stock and Benefit Plans		(3,971	)		(3,897	)
Net Cash Provided by (Used in) Financing Activities	$	24,933		$	(36,848	)

Net Increase (Decrease) in Cash and Cash Equivalents		10,472			(13,762	)
Cash and Cash Equivalents at Beginning of Period		38,222			55,447
Cash and Cash Equivalents at December 31	$	48,694		$	41,685

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)

UPSTREAM BUSINESS


	Three Months Ended
(Thousands of Dollars, except per share amounts)	December 31,
EXPLORATION AND PRODUCTION SEGMENT	2024			2023			Variance
Total Operating Revenues	$	248,860		$	254,019		$	(5,159	)
Operating Expenses:
Operation and Maintenance:
General and Administrative Expense		19,326			17,793			1,533
Lease Operating and Transportation Expense		65,640			67,074			(1,434	)
All Other Operation and Maintenance Expense		3,867			5,544			(1,677	)
Property, Franchise and Other Taxes		3,382			3,638			(256	)
Depreciation, Depletion and Amortization		63,304			71,965			(8,661	)
Impairment of Assets		141,802			—			141,802
		297,321			166,014			131,307

Operating Income (Loss)		(48,461	)		88,005			(136,466	)

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Credit		37			100			(63	)
Interest and Other Income (Deductions)		272			(1,513	)		1,785
Interest Expense		(15,200	)		(15,268	)		68
Income (Loss) Before Income Taxes		(63,352	)		71,324			(134,676	)
Income Tax Expense (Benefit)		(16,575	)		18,841			(35,416	)
Net Income (Loss)	$	(46,777	)	$	52,483		$	(99,260	)
Net Income (Loss) Per Share (Diluted)	$	(0.51	)	$	0.57		$	(1.08	)

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)

MIDSTREAM BUSINESSES

	Three Months Ended
(Thousands of Dollars, except per share amounts)	December 31,
PIPELINE AND STORAGE SEGMENT	2024			2023			Variance
Revenues from External Customers	$	68,750		$	64,826		$	3,924
Intersegment Revenues		37,862			29,587			8,275
Total Operating Revenues		106,612			94,413			12,199
Operating Expenses:
Purchased Gas		(42	)		601			(643	)
Operation and Maintenance		27,034			25,950			1,084
Property, Franchise and Other Taxes		8,667			8,720			(53	)
Depreciation, Depletion and Amortization		18,585			18,213			372
		54,244			53,484			760

Operating Income		52,368			40,929			11,439

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Credit		952			1,257			(305	)
Interest and Other Income		2,040			1,931			109
Interest Expense		(11,729	)		(11,725	)		(4	)
Income Before Income Taxes		43,631			32,392			11,239
Income Tax Expense		11,177			8,337			2,840
Net Income	$	32,454		$	24,055		$	8,399
Net Income Per Share (Diluted)	$	0.35		$	0.26		$	0.09


	Three Months Ended
	December 31,
GATHERING SEGMENT	2024			2023			Variance
Revenues from External Customers	$	3,448		$	4,596		$	(1,148	)
Intersegment Revenues		57,683			57,992			(309	)
Total Operating Revenues		61,131			62,588			(1,457	)
Operating Expenses:
Operation and Maintenance		9,429			9,504			(75	)
Property, Franchise and Other Taxes		(234	)		23			(257	)
Depreciation, Depletion and Amortization		10,515			9,458			1,057
		19,710			18,985			725

Operating Income		41,421			43,603			(2,182	)

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Credit		—			9			(9	)
Interest and Other Income		58			73			(15	)
Interest Expense		(4,210	)		(3,729	)		(481	)
Income Before Income Taxes		37,269			39,956			(2,687	)
Income Tax Expense		10,124			11,131			(1,007	)
Net Income	$	27,145		$	28,825		$	(1,680	)
Net Income Per Share (Diluted)	$	0.30		$	0.31		$	(0.01	)

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)

DOWNSTREAM BUSINESS


	Three Months Ended
(Thousands of Dollars, except per share amounts)	December 31,
UTILITY SEGMENT	2024			2023			Variance
Revenues from External Customers	$	228,424		$	201,920		$	26,504
Intersegment Revenues		85			87			(2	)
Total Operating Revenues		228,509			202,007			26,502
Operating Expenses:
Purchased Gas		101,473			84,051			17,422
Operation and Maintenance		56,260			54,684			1,576
Property, Franchise and Other Taxes		10,111			9,906			205
Depreciation, Depletion and Amortization		16,827			16,037			790
		184,671			164,678			19,993

Operating Income		43,838			37,329			6,509

Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Credit		5,871			470			5,401
Interest and Other Income		528			1,911			(1,383	)
Interest Expense		(10,716	)		(8,457	)		(2,259	)
Income Before Income Taxes		39,521			31,253			8,268
Income Tax Expense		7,022			4,702			2,320
Net Income	$	32,499		$	26,551		$	5,948
Net Income Per Share (Diluted)	$	0.36		$	0.29		$	0.07

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT OPERATING RESULTS AND STATISTICS
(UNAUDITED)

	Three Months Ended
(Thousands of Dollars, except per share amounts)	December 31,
ALL OTHER	2024			2023			Variance
Total Operating Revenues	$	—		$	—		$	—
Operating Expenses:
Operation and Maintenance		—			—			—
		—			—			—

Operating Income		—			—			—
Other Income (Expense):
Interest and Other Income (Deductions)		(136	)		(77	)		(59	)
Interest Expense		(116	)		(81	)		(35	)
Loss before Income Taxes		(252	)		(158	)		(94	)
Income Tax Benefit		(59	)		(37	)		(22	)
Net Loss	$	(193	)	$	(121	)	$	(72	)
Net Loss Per Share (Diluted)	$	—		$	—		$	—

	Three Months Ended
	December 31,
CORPORATE	2024			2023			Variance
Revenues from External Customers	$	—		$	—		$	—
Intersegment Revenues		1,341			1,285			56
Total Operating Revenues		1,341			1,285			56
Operating Expenses:
Operation and Maintenance		4,047			3,795			252
Property, Franchise and Other Taxes		130			129			1
Depreciation, Depletion and Amortization		139			117			22
		4,316			4,041			275

Operating Loss		(2,975	)		(2,756	)		(219	)
Other Income (Expense):
Non-Service Pension and Post-Retirement Benefit Costs		(212	)		(387	)		175
Interest and Other Income		41,061			41,030			31
Interest Expense on Long-Term Debt		(33,362	)		(28,462	)		(4,900	)
Other Interest Expense		(5,161	)		(8,085	)		2,924
Income (Loss) before Income Taxes		(649	)		1,340			(1,989	)
Income Tax Expense (Benefit)		(507	)		113			(620	)
Net Income (Loss)	$	(142	)	$	1,227		$	(1,369	)
Net Income (Loss) Per Share (Diluted)	$	(0.01	)	$	0.01		$	(0.02	)


	Three Months Ended
	December 31,
INTERSEGMENT ELIMINATIONS	2024			2023			Variance
Intersegment Revenues	$	(96,971	)	$	(88,951	)	$	(8,020	)
Operating Expenses:
Purchased Gas		(36,094	)		(28,100	)		(7,994	)
Operation and Maintenance		(60,877	)		(60,851	)		(26	)
		(96,971	)		(88,951	)		(8,020	)
Operating Income		—			—			—
Other Income (Expense):
Interest and Other Deductions		(42,751	)		(41,072	)		(1,679	)
Interest Expense		42,751			41,072			1,679
Net Income	$	—		$	—		$	—
Net Income Per Share (Diluted)	$	—		$	—		$	—

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

SEGMENT INFORMATION (Continued)
(Thousands of Dollars)

	Three Months Ended
	December 31,
	(Unaudited)
							Increase
	2024			2023			(Decrease)

Capital Expenditures:
Exploration and Production	$	122,602	⁽¹⁾⁽²⁾	$	160,957	⁽³⁾⁽⁴⁾	$	(38,355	)
Pipeline and Storage		19,792	⁽¹⁾⁽²⁾		24,554	⁽³⁾⁽⁴⁾		(4,762	)
Gathering		13,027	⁽¹⁾⁽²⁾		19,569	⁽³⁾⁽⁴⁾		(6,542	)
Utility		36,430	⁽¹⁾⁽²⁾		30,510	⁽³⁾⁽⁴⁾		5,920
Total Reportable Segments		191,851			235,590			(43,739	)
All Other		—			—			—
Corporate		204			61			143
Total Capital Expenditures	$	192,055		$	235,651		$	(43,596	)

(1)	Capital expenditures for the quarter ended December 31, 2024, include accounts payable and accrued liabilities related to capital expenditures of $56.3 million, $4.4 million, $6.0 million, and $4.9 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts have been excluded from the Consolidated Statement of Cash Flows at December 31, 2024, since they represent non-cash investing activities at that date.

(2)	Capital expenditures for the quarter ended December 31, 2024, exclude capital expenditures of $63.3 million, $14.4 million, $21.7 million and $20.6 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2024 and paid during the quarter ended December 31, 2024. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2024, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at December 31, 2024.

(3)	Capital expenditures for the quarter ended December 31, 2023, include accounts payable and accrued liabilities related to capital expenditures of $74.9 million, $5.5 million, $11.1 million, and $6.4 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were excluded from the Consolidated Statement of Cash Flows at December 31, 2023, since they represented non-cash investing activities at that date.

(4)	Capital expenditures for the quarter ended December 31, 2023, exclude capital expenditures of $43.2 million, $31.8 million, $20.6 million and $13.6 million in the Exploration and Production segment, Pipeline and Storage segment, Gathering segment and Utility segment, respectively. These amounts were in accounts payable and accrued liabilities at September 30, 2023 and paid during the quarter ended December 31, 2023. These amounts were excluded from the Consolidated Statement of Cash Flows at September 30, 2023, since they represented non-cash investing activities at that date. These amounts have been included in the Consolidated Statement of Cash Flows at December 31, 2023.

DEGREE DAYS
				Percent Colder
				(Warmer) Than:
Three Months Ended December 31,	Normal	2024	2023	Normal ⁽¹⁾	Last Year ⁽¹⁾
Buffalo, NY	2,253	1,884	1,858	(16.4)	1.4
Erie, PA	1,894	1,697	1,664	(10.4)	2.0

⁽¹⁾Percents compare actual 2024 degree days to normal degree days and actual 2024 degree days to actual 2023 degree days.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES

EXPLORATION AND PRODUCTION INFORMATION


	Three Months Ended
	December 31,
					Increase
	2024		2023		(Decrease)

Gas Production/Prices:
Production (MMcf)
Appalachia		97,717		100,757		(3,040	)

Average Prices (Per Mcf)
Weighted Average	$	2.23	$	2.31	$	(0.08	)
Weighted Average after Hedging		2.53		2.51		0.02

Selected Operating Performance Statistics:
General and Administrative Expense per Mcf ⁽¹⁾	$	0.20	$	0.18	$	0.02
Lease Operating and Transportation Expense per Mcf ⁽¹⁾⁽²⁾	$	0.67	$	0.67	$	—
Depreciation, Depletion and Amortization per Mcf ⁽¹⁾	$	0.65	$	0.71	$	(0.06	)

⁽¹⁾Refer to page 13 for the General and Administrative Expense, Lease Operating and Transportation Expense and Depreciation, Depletion, and Amortization Expense for the Exploration and Production segment.

⁽²⁾Amounts include transportation expense of $0.57 and $0.56 per Mcf for the three months ended December 31, 2024 and December 31, 2023, respectively.

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES



Pipeline and Storage Throughput – (millions of cubic feet – MMcf)

	Three Months Ended
	December 31,
			Increase
	2024	2023	(Decrease)
Firm Transportation – Affiliated	31,870	31,495	375
Firm Transportation – Non-Affiliated	171,012	168,606	2,406
Interruptible Transportation	62	118	(56	)
	202,944	200,219	2,725

Gathering Volume – (MMcf)
	Three Months Ended
	December 31,
			Increase
	2024	2023	(Decrease)
Gathered Volume	120,961	124,261	(3,300	)


Utility Throughput – (MMcf)
	Three Months Ended
	December 31,
			Increase
	2024	2023	(Decrease)
Retail Sales:
Residential Sales	18,476	17,982	494
Commercial Sales	2,919	2,800	119
Industrial Sales	199	138	61
	21,594	20,920	674
Transportation	16,942	17,528	(586	)
	38,536	38,448	88

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES

In addition to financial measures calculated in accordance with generally accepted accounting principles (GAAP), this press release contains information regarding adjusted operating results, adjusted EBITDA and free cash flow, which are non-GAAP financial measures. The Company believes that these non-GAAP financial measures are useful to investors because they provide an alternative method for assessing the Company’s ongoing operating results or liquidity and for comparing the Company’s financial performance to other companies. The Company’s management uses these non-GAAP financial measures for the same purpose, and for planning and forecasting purposes. The presentation of non-GAAP financial measures is not meant to be a substitute for financial measures in accordance with GAAP.

Management defines adjusted operating results as reported GAAP earnings before items impacting comparability. The following table reconciles National Fuel’s reported GAAP earnings to adjusted operating results for the three months ended December 31, 2024 and 2023:

	Three Months Ended
	December 31,
(in thousands except per share amounts)	2024			2023
Reported GAAP Earnings	$	44,986		$	133,020
Items impacting comparability:
Impairment of assets (E&P)		141,802			—
Tax impact of impairment of assets		(37,169	)		—
Unrealized (gain) loss on derivative asset (E&P)		349			4,198
Tax impact of unrealized (gain) loss on derivative asset		(94	)		(1,151	)
Unrealized (gain) loss on other investments (Corporate / All Other)		2,617			(1,049	)
Tax impact of unrealized (gain) loss on other investments		(550	)		220
Adjusted Operating Results	$	151,941		$	135,238

Reported GAAP Earnings Per Share	$	0.49		$	1.44
Items impacting comparability:
Impairment of assets, net of tax (E&P)		1.14			—
Unrealized (gain) loss on derivative asset, net of tax (E&P)		—			0.03
Unrealized (gain) loss on other investments, net of tax (Corporate / All Other)		0.02			(0.01	)
Rounding		0.01			—
Adjusted Operating Results Per Share	$	1.66		$	1.46

Management defines adjusted EBITDA as reported GAAP earnings before the following items: interest expense, income taxes, depreciation, depletion and amortization, other income and deductions, impairments, and other items reflected in operating income that impact comparability. The following tables reconcile National Fuel’s reported GAAP earnings to adjusted EBITDA for the three months ended December 31, 2024 and 2023:

	Three Months Ended
	December 31,
(in thousands)	2024			2023
Reported GAAP Earnings	$	44,986		$	133,020
Depreciation, Depletion and Amortization		109,370			115,790
Other (Income) Deductions		(7,720	)		(3,732	)
Interest Expense		37,743			34,735
Income Taxes		11,182			43,087
Impairment of Assets		141,802			—
Adjusted EBITDA	$	337,363		$	322,900

Adjusted EBITDA by Segment
Pipeline and Storage Adjusted EBITDA	$	70,953		$	59,142
Gathering Adjusted EBITDA		51,936			53,061
Total Midstream Businesses Adjusted EBITDA		122,889			112,203
Exploration and Production Adjusted EBITDA		156,645			159,970
Utility Adjusted EBITDA		60,665			53,366
Corporate and All Other Adjusted EBITDA		(2,836	)		(2,639	)
Total Adjusted EBITDA	$	337,363		$	322,900

NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES
SEGMENT ADJUSTED EBITDA

	Three Months Ended
	December 31,
(in thousands)	2024			2023
Exploration and Production Segment
Reported GAAP Earnings	$	(46,777	)	$	52,483
Depreciation, Depletion and Amortization		63,304			71,965
Other (Income) Deductions		(309	)		1,413
Interest Expense		15,200			15,268
Income Taxes		(16,575	)		18,841
Impairment of Assets		141,802			—
Adjusted EBITDA	$	156,645		$	159,970

Pipeline and Storage Segment
Reported GAAP Earnings	$	32,454		$	24,055
Depreciation, Depletion and Amortization		18,585			18,213
Other (Income) Deductions		(2,992	)		(3,188	)
Interest Expense		11,729			11,725
Income Taxes		11,177			8,337
Adjusted EBITDA	$	70,953		$	59,142

Gathering Segment
Reported GAAP Earnings	$	27,145		$	28,825
Depreciation, Depletion and Amortization		10,515			9,458
Other (Income) Deductions		(58	)		(82	)
Interest Expense		4,210			3,729
Income Taxes		10,124			11,131
Adjusted EBITDA	$	51,936		$	53,061

Utility Segment
Reported GAAP Earnings	$	32,499		$	26,551
Depreciation, Depletion and Amortization		16,827			16,037
Other (Income) Deductions		(6,399	)		(2,381	)
Interest Expense		10,716			8,457
Income Taxes		7,022			4,702
Adjusted EBITDA	$	60,665		$	53,366

Corporate and All Other
Reported GAAP Earnings	$	(335	)	$	1,106
Depreciation, Depletion and Amortization		139			117
Other (Income) Deductions		2,038			506
Interest Expense		(4,112	)		(4,444	)
Income Taxes		(566	)		76
Adjusted EBITDA	$	(2,836	)	$	(2,639	)

Management defines free cash flow as net cash provided by operating activities, less net cash used in investing activities, adjusted for acquisitions and divestitures. The Company is unable to provide a reconciliation of any projected free cash flow measure to its comparable GAAP financial measure without unreasonable efforts. This is due to an inability to calculate the comparable GAAP projected metrics, including operating income and total production costs, given the unknown effect, timing, and potential significance of certain income statement items.

The MIL Network –

January 30, 2025

MIL-OSI Economics: Microsoft Cloud and AI strength drives second quarter results

Source: Microsoft

Headline: Microsoft Cloud and AI strength drives second quarter results

Microsoft Cloud and AI Strength Drives Second Quarter Results

REDMOND, Wash. — January 29, 2025 — Microsoft Corp. today announced the following results for the quarter ended December 31, 2024, as compared to the corresponding period of last fiscal year:

· Revenue was $69.6 billion and increased 12%

· Operating income was $31.7 billion and increased 17% (up 16% in constant currency)

· Net income was $24.1 billion and increased 10%

· Diluted earnings per share was $3.23 and increased 10%

“We are innovating across our tech stack and helping customers unlock the full ROI of AI to capture the massive opportunity ahead,” said Satya Nadella, chairman and chief executive officer of Microsoft. “Already, our AI business has surpassed an annual revenue run rate of $13 billion, up 175% year-over-year.”

“This quarter Microsoft Cloud revenue was $40.9 billion, up 21% year-over-year,” said Amy Hood, executive vice president and chief financial officer of Microsoft. ”We remain committed to balancing operational discipline with continued investments in our cloud and AI infrastructure.”

Business Highlights

Revenue in Productivity and Business Processes was $29.4 billion and increased 14% (up 13% in constant currency), with the following business highlights:

· Microsoft 365 Commercial products and cloud services revenue increased 15% driven by Microsoft 365 Commercial cloud revenue growth of 16% (up 15% in constant currency)

· Microsoft 365 Consumer products and cloud services revenue increased 8% driven by Microsoft 365 Consumer cloud revenue growth of 8%

· LinkedIn revenue increased 9%

· Dynamics products and cloud services revenue increased 15% (up 14% in constant currency) driven by Dynamics 365 revenue growth of 19% (up 18% in constant currency)

Revenue in Intelligent Cloud was $25.5 billion and increased 19%, with the following business highlights:

· Server products and cloud services revenue increased 21% driven by Azure and other cloud services revenue growth of 31%

Revenue in More Personal Computing was $14.7 billion and was relatively unchanged, with the following business highlights:

· Windows OEM and Devices revenue increased 4%

· Xbox content and services revenue increased 2%

· Search and news advertising revenue excluding traffic acquisition costs increased 21% (up 20% in constant currency)

Microsoft returned $9.7 billion to shareholders in the form of dividends and share repurchases in the second quarter of fiscal year 2025.

Business Outlook

Microsoft will provide forward-looking guidance in connection with this quarterly earnings announcement on its earnings conference call and webcast.

Quarterly Highlights, Product Releases, and Enhancements

Every quarter Microsoft delivers hundreds of products, either as new releases, services, or enhancements to current products and services. These releases are a result of significant research and development investments, made over multiple years, designed to help customers be more productive and secure and to deliver differentiated value across the cloud and the edge.

Here are the major product releases and other highlights for the quarter, organized by product categories, to help illustrate how we are accelerating innovation across our businesses while expanding our market opportunities.

Environmental, Social, and Governance (ESG)

To learn more about Microsoft’s corporate governance and our environmental and social practices, please visit our investor relations Board and ESG website and reporting at Microsoft.com/transparency.

Webcast Details

Satya Nadella, chairman and chief executive officer, Amy Hood, executive vice president and chief financial officer, Alice Jolla, chief accounting officer, Keith Dolliver, corporate secretary and deputy general counsel, and Brett Iversen, vice president of investor relations, will host a conference call and webcast at 2:30 p.m. Pacific time (5:30 p.m. Eastern time) today to discuss details of the company’s performance for the quarter and certain forward-looking information. The session may be accessed at http://www.microsoft.com/en-us/investor. The webcast will be available for replay through the close of business on January 29, 2026.

Constant Currency

Microsoft presents constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars using the average exchange rates from the comparative period rather than the actual exchange rates in effect during the respective periods. All growth comparisons relate to the corresponding period in the last fiscal year. Microsoft has provided this non-GAAP financial information to aid investors in better understanding our performance. The non-GAAP financial measures presented in this release should not be considered as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP.

Financial Performance Constant Currency Reconciliation

	Three Months Ended December 31,
($ in millions, except per share amounts)	Revenue	Operating Income	Net Income	Diluted Earnings per Share
2023 As Reported (GAAP)	$62,020	$27,032	$21,870	$2.93
2024 As Reported (GAAP)	$69,632	$31,653	$24,108	$3.23
Percentage Change Y/Y (GAAP)	12%	17%	10%	10%
Constant Currency Impact	$171	$206	$14	$0.00
Percentage Change Y/Y Constant Currency	12%	16%	10%	10%

Segment Revenue Constant Currency Reconciliation

	Three Months Ended December 31,
($ in millions)	Productivity and Business Processes	Intelligent Cloud	More Personal Computing
2023 As Reported (GAAP)	$25,854	$21,525	$14,641
2024 As Reported (GAAP)	$29,437	$25,544	$14,651
Percentage Change Y/Y (GAAP)	14%	19%	0%
Constant Currency Impact	$142	$(22)	$51
Percentage Change Y/Y Constant Currency	13%	19%	0%

We have recast certain prior period amounts to conform to the way we internally manage and monitor our business.

Selected Product and Service Revenue Constant Currency Reconciliation

	Three Months Ended December 31, 2024
	Percentage Change Y/Y (GAAP)	Constant Currency Impact	Percentage Change Y/Y Constant Currency
Microsoft Cloud	21%	0%	21%
Microsoft 365 Commercial products and cloud services	15%	0%	15%
Microsoft 365 Commercial cloud	16%	(1)%	15%
Microsoft 365 Consumer products and cloud services	8%	0%	8%
Microsoft 365 Consumer cloud	8%	0%	8%
LinkedIn	9%	0%	9%
Dynamics products and cloud services	15%	(1)%	14%
Dynamics 365	19%	(1)%	18%
Server products and cloud services	21%	0%	21%
Azure and other cloud services	31%	0%	31%
Windows OEM and Devices	4%	0%	4%
Xbox content and services	2%	0%	2%
Search and news advertising excluding traffic acquisition costs	21%	(1)%	20%

About Microsoft

Microsoft (Nasdaq “MSFT” @microsoft) creates platforms and tools powered by AI to deliver innovative solutions that meet the evolving needs of our customers. The technology company is committed to making AI available broadly and doing so responsibly, with a mission to empower every person and every organization on the planet to achieve more.

Forward-Looking Statements

Statements in this release that are “forward-looking statements” are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially because of factors such as:

· intense competition in all of our markets that may adversely affect our results of operations;

· focus on cloud-based and AI services presenting execution and competitive risks;

· significant investments in products and services that may not achieve expected returns;

· acquisitions, joint ventures, and strategic alliances that may have an adverse effect on our business;

· impairment of goodwill or amortizable intangible assets causing a significant charge to earnings;

· cyberattacks and security vulnerabilities that could lead to reduced revenue, increased costs, liability claims, or harm to our reputation or competitive position;

· disclosure and misuse of personal data that could cause liability and harm to our reputation;

· the possibility that we may not be able to protect information stored in our products and services from use by others;

· abuse of our advertising, professional, marketplace, or gaming platforms that may harm our reputation or user engagement;

· products and services, how they are used by customers, and how third-party products and services interact with them, presenting security, privacy, and execution risks;

· issues about the use of AI in our offerings that may result in reputational or competitive harm, or legal liability;

· excessive outages, data losses, and disruptions of our online services if we fail to maintain an adequate operations infrastructure;

· supply or quality problems;

· government enforcement under competition laws and new market regulation may limit how we design and market our products;

· potential consequences of trade and anti-corruption laws;

· potential consequences of existing and increasing legal and regulatory requirements;

· laws and regulations relating to the handling of personal data that may impede the adoption of our services or result in increased costs, legal claims, fines, or reputational damage;

· claims against us that may result in adverse outcomes in legal disputes;

· uncertainties relating to our business with government customers;

· additional tax liabilities;

· sustainability regulations and expectations that may expose us to increased costs and legal and reputational risk;

· an inability to protect and utilize our intellectual property may harm our business and operating results;

· claims that Microsoft has infringed the intellectual property rights of others;

· damage to our reputation or our brands that may harm our business and results of operations;

· adverse economic or market conditions that may harm our business;

· catastrophic events or geo-political conditions, such as the COVID-19 pandemic, that may disrupt our business;

· exposure to increased economic and operational uncertainties from operating a global business, including the effects of foreign currency exchange; and

· the dependence of our business on our ability to attract and retain talented employees.

For more information about risks and uncertainties associated with Microsoft’s business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of Microsoft’s SEC filings, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained by contacting Microsoft’s Investor Relations department at (800) 285-7772 or at Microsoft’s Investor Relations website at http://www.microsoft.com/en-us/investor.

All information in this release is as of December 31, 2024. The company undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in the company’s expectations.

For more information, press only:

Microsoft Media Relations, WE Communications for Microsoft, (425) 638-7777, rrt@we-worldwide.com

For more information, financial analysts and investors only:

Brett Iversen, Vice President, Investor Relations, (425) 706-4400

Note to editors: For more information, news and perspectives from Microsoft, please visit the Microsoft News Center at http://www.microsoft.com/news. Web links, telephone numbers, and titles were correct at time of publication, but may since have changed. Shareholder and financial information, as well as today’s 2:30 p.m. Pacific time conference call with investors and analysts, is available at http://www.microsoft.com/en-us/investor.

**MICROSOFT CORPORATION**

INCOME STATEMENTS

(In millions, except per share amounts) (Unaudited)
	Three Months Ended December 31,		Six Months Ended December 31,
	Three Months Ended December 31,		Six Months Ended December 31,
	2024	2023	2024	2023
Revenue:
Product	$16,219	$18,941	$31,491	$34,476
Service and other	53,413	43,079	103,726	84,061
Total revenue	69,632	62,020	135,217	118,537
Cost of revenue:
Product	3,856	5,964	7,150	9,495
Service and other	17,943	13,659	34,748	26,430
Total cost of revenue	21,799	19,623	41,898	35,925
Gross margin	47,833	42,397	93,319	82,612
Research and development	7,917	7,142	15,461	13,801
Sales and marketing	6,440	6,246	12,157	11,433
General and administrative	1,823	1,977	3,496	3,451
Operating income	31,653	27,032	62,205	53,927
Other expense, net	(2,288)	(506)	(2,571)	(117)
Income before income taxes	29,365	26,526	59,634	53,810
Provision for income taxes	5,257	4,656	10,859	9,649
Net income	$24,108	$21,870	$48,775	$44,161
Earnings per share:
Basic	$3.24	$2.94	$6.56	$5.94
Diluted	$3.23	$2.93	$6.53	$5.92
Weighted average shares outstanding:
Basic	7,435	7,432	7,434	7,431
Diluted	7,468	7,468	7,469	7,465

COMPREHENSIVE INCOME STATEMENTS

(In millions) (Unaudited)
	Three Months Ended December 31,		Six Months Ended December 31,
	Three Months Ended December 31,		Six Months Ended December 31,
	2024	2023	2024	2023
Net income	$24,108	$21,870	$48,775	$44,161
Other comprehensive income (loss), net of tax:
Net change related to derivatives	34	(3)	24	18
Net change related to investments	(434)	1,331	680	1,071
Translation adjustments and other	(1,034)	660	(730)	305
Other comprehensive income (loss)	(1,434)	1,988	(26)	1,394
Comprehensive income	$22,674	$23,858	$48,749	$45,555

BALANCE SHEETS

(In millions) (Unaudited)
	December 31, 2024	June 30, 2024
Assets
Current assets:
Cash and cash equivalents	$17,482	$18,315
Short-term investments	54,073	57,228
Total cash, cash equivalents, and short-term investments	71,555	75,543
Accounts receivable, net of allowance for doubtful accounts of $662 and $830	48,188	56,924
Inventories	909	1,246
Other current assets	26,428	26,021
Total current assets	147,080	159,734
Property and equipment, net of accumulated depreciation of $82,820 and $76,421	166,902	135,591
Operating lease right-of-use assets	22,816	18,961
Equity and other investments	15,581	14,600
Goodwill	119,191	119,220
Intangible assets, net	25,385	27,597
Other long-term assets	36,943	36,460
Total assets	$533,898	$512,163
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$22,608	$21,996
Short-term debt	0	6,693
Current portion of long-term debt	5,248	2,249
Accrued compensation	9,176	12,564
Short-term income taxes	6,056	5,017
Short-term unearned revenue	45,508	57,582
Other current liabilities	20,286	19,185
Total current liabilities	108,882	125,286
Long-term debt	39,722	42,688
Long-term income taxes	24,389	27,931
Long-term unearned revenue	2,537	2,602
Deferred income taxes	2,513	2,618
Operating lease liabilities	17,254	15,497
Other long-term liabilities	35,906	27,064
Total liabilities	231,203	243,686
Commitments and contingencies
Stockholders’ equity:
Common stock and paid-in capital – shares authorized 24,000; outstanding 7,435 and 7,434	104,829	100,923
Retained earnings	203,482	173,144
Accumulated other comprehensive loss	(5,616)	(5,590)
Total stockholders’ equity	302,695	268,477
Total liabilities and stockholders’ equity	$533,898	$512,163

CASH FLOWS STATEMENTS

(In millions) (Unaudited)
	Three Months Ended December 31,		Six Months Ended December 31,
	Three Months Ended December 31,		Six Months Ended December 31,
	2024	2023	2024	2023
Operations
Net income	$24,108	$21,870	$48,775	$44,161
Adjustments to reconcile net income to net cash from operations:
Depreciation, amortization, and other	6,827	5,959	14,210	9,880
Stock-based compensation expense	3,089	2,828	5,921	5,335
Net recognized losses on investments and derivatives	976	198	851	212
Deferred income taxes	(1,158)	(1,702)	(2,591)	(2,270)
Changes in operating assets and liabilities:
Accounts receivable	(5,978)	(2,951)	8,059	8,083
Inventories	711	1,474	338	969
Other current assets	(353)	725	(435)	(71)
Other long-term assets	(1,089)	(1,427)	(2,850)	(3,440)
Accounts payable	958	(2,521)	42	(1,307)
Unearned revenue	(6,338)	(5,538)	(11,891)	(9,664)
Income taxes	(3,395)	(1,554)	(2,379)	(129)
Other current liabilities	3,217	1,518	(2,262)	(2,588)
Other long-term liabilities	716	(26)	683	265
Net cash from operations	22,291	18,853	56,471	49,436
Financing
Proceeds from issuance (repayments) of debt, maturities of 90 days or less, net	0	(8,490)	(5,746)	10,202
Proceeds from issuance of debt	0	10,773	0	17,846
Repayments of debt	0	(2,916)	(966)	(4,416)
Common stock issued	256	261	962	946
Common stock repurchased	(4,986)	(4,000)	(9,093)	(8,831)
Common stock cash dividends paid	(6,170)	(5,574)	(11,744)	(10,625)
Other, net	(343)	(201)	(1,232)	(508)
Net cash from (used in) financing	(11,243)	(10,147)	(27,819)	4,614
Investing
Additions to property and equipment	(15,804)	(9,735)	(30,727)	(19,652)
Acquisition of companies, net of cash acquired, and purchases of intangible and other assets	(1,405)	(65,029)	(3,254)	(66,215)
Purchases of investments	(2,050)	(4,258)	(3,670)	(12,718)
Maturities of investments	2,604	4,150	4,740	19,868
Sales of investments	2,559	1,600	4,527	6,930
Other, net	(16)	1,347	(929)	365
Net cash used in investing	(14,112)	(71,925)	(29,313)	(71,422)
Effect of foreign exchange rates on cash and cash equivalents	(294)	72	(172)	(27)
Net change in cash and cash equivalents	(3,358)	(63,147)	(833)	(17,399)
Cash and cash equivalents, beginning of period	20,840	80,452	18,315	34,704
Cash and cash equivalents, end of period	$17,482	$17,305	$17,482	$17,305

SEGMENT REVENUE AND OPERATING INCOME

(In millions) (Unaudited)
	Three Months Ended December 31,		Six Months Ended December 31,
	Three Months Ended December 31,		Six Months Ended December 31,
	2024	2023	2024	2023
Revenue
Productivity and Business Processes	$29,437	$25,854	$57,754	$51,080
Intelligent Cloud	25,544	21,525	49,636	41,538
More Personal Computing	14,651	14,641	27,827	25,919
Total	$69,632	$62,020	$135,217	$118,537
Operating Income
Productivity and Business Processes	$16,885	$14,515	$33,401	$28,812
Intelligent Cloud	10,851	9,555	21,354	18,463
More Personal Computing	3,917	2,962	7,450	6,652
Total	$31,653	$27,032	$62,205	$53,927

We have recast certain prior period amounts to conform to the way we internally manage and monitor our business.

MIL OSI Economics –

January 30, 2025

MIL-OSI Security: Lead Defendants Plead Guilty to RICO Conspiracy to Transport, Hire, and Harbor Unauthorized Workers

Source: Office of United States Attorneys

Criminal Enterprise Employed Unauthorized Workers at Dozens of Mexican Restaurants Across the Midwest

KANSAS CITY, Mo. – Seven defendants, including an owner, president, chief financial officer, and controller of a Joplin, Mo., corporation, have pleaded guilty in federal court to their roles in a racketeering conspiracy to transport, hire, and harbor undocumented workers in several Midwestern states.

“This case sends a clear and unequivocal message: employing unauthorized workers will not be tolerated and will be met with severe consequences,” said Mark Zito, HSI Kansas City Special Agent in Charge. “Our investigation uncovered a blatant and systemic disregard for our nation’s employment laws. Those who engage in such unlawful practices not only undermine the integrity of our labor market but also exploit vulnerable individuals. HSI Kansas City is relentless in our pursuit to dismantle these illegal operations and hold violators accountable to the fullest extent of the law. If you break the law, you will face the full force of our investigation and prosecution.”

Jose Luis Bravo, 54, of Claremore, Oklahoma; Jose Guadalupe Razo, 54, of Carl Junction, Mo.; Anthony Edward Doll, 46, and Miguel Tarin-Martinez, 46, both of Joplin, Mo.; Alejandro Castillo-Ramirez, 43, a citizen of Mexico; Jaime Ramirez-Ceja, 46, a citizen of Mexico; and Veronica Razo de Lara, 50, of Great Bend, Kansas, have pleaded guilty before U.S. District Judge Roseann A. Ketchmark.

Each defendant admitted they were part of a RICO (racketeer influenced and corrupt organizations) conspiracy from Jan. 1, 2018, to Aug. 10, 2021, that transported and employed Mexican, Guatemalan, and El Salvadoran nationals who were not authorized to live or work in the United States. Conspirators also harbored and encouraged the unauthorized workers to remain and reside in the United States by providing them with housing and, in certain circumstances, fraudulent identification documentation.

Bravo is the partial owner of Specialty Foods Distribution, a corporation based in Joplin. Specialty Foods Distribution is a wholesale Mexican food products and restaurant supply company. Razo is the president of Specialty Foods Distribution; Doll is the chief financial officer; Tarin-Martinez is the controller.

Bravo, Razo, Doll, and Tarin-Martinez created and maintained a network of restaurants operating under multiple LLCs in Missouri, Arkansas, Kansas, and Oklahoma that were serviced by Specialty Foods Distribution. The defendants conspired to staff these restaurants with unauthorized workers. Castillo-Ramirez, Ramirez-Ceja, and Razo de Lara managed three of the enterprise-affiliated restaurants that employed unauthorized workers. By utilizing unauthorized workers — a workforce not available to law-abiding business owners — the defendants obtained an unfair and illegal competitive business advantage.

In addition to transporting, harboring, and hiring unauthorized workers, the racketeering activity involved evasive and fraudulent actions. Specifically, to maintain high levels of unauthorized employees at the enterprise-affiliated restaurants, the defendants kept certain unauthorized workers off official payroll records; required certain unauthorized workers to work at times when federal officials were unlikely to conduct inspections; failed to collect or maintain complete and accurate Form I-9 documentation; falsely attested to the accuracy of information on Form I-9 documentation; submitted inaccurate wage and hour reports to state officials; and facilitated fraudulent identification documentation being produced, transported, and provided to unauthorized workers.

Bravo specifically admitted that, as part of the RICO conspiracy, he facilitated the production and transportation of two fraudulent U.S. permanent resident cards from Claremore to Butler, Mo., as well as personally transported three unauthorized workers from Claremore to the state of Kansas. Bavo has agreed to forfeit to the government approximately $5.7 million, comprising the forfeiture of proceeds he obtained from the RICO enterprise as well as property that afforded a source of influence over the RICO enterprise. The forfeiture agreement involves liquidation of five financial accounts; the government obtaining cash in lieu of Bravo’s interest in 12 real properties; and the government obtaining cash in lieu of Bravo’s interest in portions of 24 individual companies or corporations, including a portion of SFD, which Bravo admitted afforded a source of influence over the RICO enterprise.

Razo specifically admitted that he conspired to harbor five unauthorized workers at enterprise-affiliated restaurants in Great Bend, and encouraged and induced three unauthorized workers at SFD to reside in the United States in violation of the law. Razo has agreed to forfeiture in the form of liquidation of one bank account and a money judgment in the amount of approximately $130,700, representing the proceeds he obtained from the RICO enterprise.

Doll specifically admitted to encouraging unauthorized workers to reside in the United States by conspiring to create a Missouri LLC for the purpose of opening a new restaurant where certain unauthorized workers could gain employment, and conspiring to harbor unauthorized workers by taking steps to ensure unauthorized workers did not utilize established timeclock payroll systems at certain enterprise-affiliated restaurants. Doll has agreed to forfeiture in the form of liquidation of two bank accounts and a money judgment in the amount of approximately $132,300, representing the proceeds he obtained from the RICO enterprise.

Tarin-Martinez specifically admitted to encouraging unauthorized workers to reside in the United States in violation of the law in Springfield, Mo., and in Pittsburg, Kan. Tarin-Martinez has agreed to forfeiture in the form of a money judgment in the amount of approximately $23,094, representing the proceeds he obtained from the RICO enterprise.

Castillo-Ramirez specifically admitted to harboring two unauthorized workers at an enterprise-affiliated restaurant in Augusta, Kan. Castillo-Ramirez also admitted to encouraging the two unauthorized workers to reside in the United States in violation of the law by providing the unauthorized workers with employment, keeping them out of the established payroll system, and paying them in cash or by local check.

Ramirez-Ceja specifically admitted to encouraging two unauthorized workers to reside in the United States in violation of the law by providing the workers with employment at an enterprise-affiliated restaurant in Lebanon, Mo., allowing the unauthorized workers to utilize fraudulent identification documents, and providing the unauthorized workers with housing. Additionally, Ramirez-Ceja admitted to making false attestations on two Form I-9 documents.

Razo de Lara specifically admitted to conspiring to harbor four unauthorized workers at an enterprise-affiliated restaurant in Great Bend. As part of the conspiracy, Razo de Lara agreed to keep unauthorized workers out of the established payroll system, pay the unauthorized workers in cash, and have certain unauthorized workers complete work at times when federal agents were unlikely to inspect the restaurant.

Under federal statutes, each of these defendants is subject to a sentence of up to 20 years in federal prison without parole. The maximum statutory sentence is prescribed by Congress and is provided here for informational purposes, as the sentencing of the defendants will be determined by the court based on the advisory sentencing guidelines and other statutory factors. Sentencing hearings will be scheduled after the completion of presentence investigations by the United States Probation Office.

This case is being prosecuted by Assistant U.S. Attorneys Rudolph R. Rhodes IV, Leigh Farmakidis, and Nicholas Heberle. It was investigated by Homeland Security Investigations with assistance from IRS-Criminal Investigations, Kansas Bureau of Investigation, Kansas Department of Labor, Kansas Department of Revenue, Kansas Highway Patrol, and Missouri State Highway Patrol.

MIL Security OSI –

January 30, 2025

MIL-OSI: StoneX Group Inc. to Announce 2025 Fiscal First Quarter Earnings on February 5, 2025

Source: GlobeNewswire (MIL-OSI)

NEW YORK, Jan. 29, 2025 (GLOBE NEWSWIRE) — StoneX Group Inc. (NASDAQ: SNEX) today announced that it will release its fiscal 2025 first quarter results after the market close on Wednesday, February 5, 2025. Management will host a conference call on Thursday, February 6, 2025 at 9:00 a.m. Eastern Time to review the Company’s 2025 fiscal first quarter results.

A live web cast of the conference call as well as additional information to review during the call will be made available in PDF form at https://www.stonex.com. Participants can also access the call via https://register.vevent.com/register/BIe20141cf7fd043c89fde461964a3582e approximately ten minutes prior to the start time. Participants may preregister for the conference call here.

For those who cannot access the live broadcast, a replay of the call will be available at https://www.stonex.com.

About StoneX Group Inc.
StoneX Group Inc., through its subsidiaries, operates a global financial services network that connects companies, organizations, traders and investors to the global market ecosystem through a unique blend of digital platforms, end-to-end clearing and execution services, high touch service and deep expertise. The Company strives to be the one trusted partner to its clients, providing its network, product and services to allow them to pursue trading opportunities, manage their market risks, make investments and improve their business performance. A Fortune-500 company headquartered in New York City and listed on the Nasdaq Global Select Market (NASDAQ:SNEX), StoneX Group Inc. and its more than 4,600 employees serve more than 54,000 commercial, institutional, and global payments clients, and more than 400,000 self-directed/retail accounts, from more than 80 offices spread across six continents. Further information on the Company is available at www.stonex.com.

CONTACT: StoneX Group Inc.

Investor Inquiries:

Kevin Murphy
(212) 403 – 7296
kevin.murphy@stonex.com

SNEX-G

The MIL Network –

January 30, 2025

MIL-OSI: Brookline Bancorp Announces Fourth Quarter Results

Source: GlobeNewswire (MIL-OSI)

Net Income of $17.5 million, EPS of $0.20

Operating Earnings of $20.7 million, Operating EPS of $0.23

Quarterly Dividend of $0.135

BOSTON, Jan. 29, 2025 (GLOBE NEWSWIRE) — Brookline Bancorp, Inc. (NASDAQ: BRKL) (the “Company”) today announced net income of $17.5 million, or $0.20 per basic and diluted share, and excluding $3.4 million of merger-related charges, operating earnings after tax (non-GAAP) of $20.7 million, or $0.23 per basic and diluted share for the fourth quarter of 2024, compared to net income and operating earnings after tax (non-GAAP) of $20.1 million, or $0.23 per basic and diluted share, for the third quarter of 2024, and $22.9 million, or $0.26 per basic and diluted share, for the fourth quarter of 2023.

For the year ended December 31, 2024, the Company reported net income of $68.7 million, or $0.77 per basic and diluted share, compared to $75.0 million, or $0.85 per basic and diluted share, for the year ended December 31, 2023. For the year ended December 31, 2024, the Company reported operating earnings after tax (non-GAAP) of $72.4 million, or $0.81 per basic and diluted share, compared to $92.9 million, or $1.05 per basic and diluted share, for the year ended December 31, 2023.

Paul Perrault, Chairman and Chief Executive Officer, commented on the Company’s performance, “Brookline Bancorp had an excellent year in 2024. We finished the year with solid deposit and loan growth and are well positioned as we look forward to 2025. We are looking forward to 2025 and our recently announced strategic merger with Berkshire Hills Bancorp. I would like to recognize the contributions of our employees in contributing to our growth and success in 2024. Our employees exemplify the Brookline Bancorp culture of providing excellent customer service.”

BALANCE SHEET

Total assets at December 31, 2024 increased $228.6 million to $11.9 billion from $11.7 billion at September 30, 2024, and increased $523.1 million from $11.4 billion at December 31, 2023. At December 31, 2024, total loans and leases were $9.8 billion, representing an increase of $24.1 million from September 30, 2024, and an increase of $137.7 million from December 31, 2023.

Total investment securities at December 31, 2024 increased $39.6 million to $895.0 million from $855.4 million at September 30, 2024, and decreased $21.6 million from $916.6 million at December 31, 2023. Total cash and cash equivalents at December 31, 2024 increased $135.8 million to $543.7 million from $407.9 million at September 30, 2024, and increased $410.6 million from $133.0 million at December 31, 2023. As of December 31, 2024, total investment securities and total cash and cash equivalents represented 12.1 percent of total assets, compared to 10.8 percent and 9.2 percent as of September 30, 2024 and December 31, 2023, respectively.

Total deposits at December 31, 2024 increased $169.4 million to $8.9 billion from $8.7 billion at September 30, 2024, consisting of a $115.9 million increase in customer deposits and a $53.4 million increase in brokered deposits. Total deposits increased $353.5 million from $8.5 billion at December 31, 2023, primarily driven by growth in customer deposits.

Total borrowed funds at December 31, 2024 increased $22.3 million to $1.5 billion from September 30, 2024, and increased $143.2 million from $1.4 billion at December 31, 2023.

The ratio of stockholders’ equity to total assets was 10.26 percent at December 31, 2024, as compared to 10.54 percent at September 30, 2024, and 10.53 percent at December 31, 2023. The ratio of tangible stockholders’ equity to tangible assets (non-GAAP) was 8.27 percent at December 31, 2024, as compared to 8.50 percent at September 30, 2024, and 8.39 percent at December 31, 2023. Tangible book value per common share (non-GAAP) decreased $0.08 from $10.89 at September 30, 2024 to $10.81 at December 31, 2024, and increased $0.31 from $10.50 at December 31, 2023.

NET INTEREST INCOME

Net interest income increased $2.0 million to $85.0 million during the fourth quarter of 2024 from $83.0 million for the quarter ended September 30, 2024. The net interest margin increased 5 basis points to 3.12 percent for the three months ended December 31, 2024 from 3.07 percent for the three months ended September 30, 2024, primarily driven by lower funding costs partially offset by lower yields on loans and leases.

NON-INTEREST INCOME

Total non-interest income for the quarter ended December 31, 2024 increased $0.2 million to $6.6 million from $6.3 million for the quarter ended September 30, 2024. The increase was primarily driven by an increase of $1.1 million in loan level derivative income, net, partially offset by a decline of $0.8 million in mark to market on interest rate swaps.

PROVISION FOR CREDIT LOSSES

The Company recorded a provision for credit losses of $4.1 million for the quarter ended December 31, 2024, compared to $4.8 million for the quarter ended September 30, 2024. The decrease in the provision was largely driven by improving economic forecasts and stabilization in the volume of adversely graded credits.

Total net charge-offs for the fourth quarter of 2024 were $7.3 million, compared to $3.8 million in the third quarter of 2024. The $7.3 million in net charge-offs was driven by one large $5.1 million charge-off in equipment financing which was previously reserved for. The ratio of net loan and lease charge-offs to average loans and leases on an annualized basis increased to 30 basis points for the fourth quarter of 2024 from 16 basis points for the third quarter of 2024.

The allowance for loan and lease losses represented 1.28 percent of total loans and leases at December 31, 2024, compared to 1.31 percent at September 30, 2024, and 1.22 percent at December 31, 2023. The decrease in the ratio was driven by a reduction in specific reserves due to charge-offs in the quarter.

ASSET QUALITY

The ratio of total nonperforming loans and leases to total loans and leases was 0.71 percent at December 31, 2024 as compared to 0.73 percent at September 30, 2024. Total nonaccrual loans and leases decreased $1.9 million to $69.3 million at December 31, 2024 from $71.2 million at September 30, 2024. The ratio of nonperforming assets to total assets was 0.59 percent at December 31, 2024 as compared to 0.62 percent at September 30, 2024. Total nonperforming assets decreased $2.4 million to $70.5 million at December 31, 2024 from $72.8 million at September 30, 2024.

NON-INTEREST EXPENSE

Non-interest expense for the quarter ended December 31, 2024 increased $5.8 million to $63.7 million from $57.9 million for the quarter ended September 30, 2024. The increase was primarily driven by an increase of $3.4 million in merger and acquisition expense, and an increase of $2.1 million in compensation and employee benefits expense.

PROVISION FOR INCOME TAXES

The effective tax rate was 26.4 percent and 25.1 percent for the three and twelve months ended December 31, 2024 compared to 24.7 percent for the three months ended September 30, 2024 and 19.9 percent and 20.1 percent for the three and twelve months ended December 31, 2023.

RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

The annualized return on average assets decreased to 0.61 percent during the fourth quarter of 2024 compared to 0.70 percent for the third quarter of 2024; and was 0.60 percent for the year ended December 31, 2024, compared to 0.67 percent for the year ended December 31, 2023.

The annualized return on average tangible stockholders’ equity (non-GAAP) decreased to 7.21 percent during the fourth quarter of 2024 compared to 8.44 percent for the third quarter of 2024; and was 7.24 percent for the year ended December 31, 2024 compared to 8.36 percent for the year ended December 31, 2023.

DIVIDEND DECLARED

The Company’s Board of Directors approved a dividend of $0.135 per share for the quarter ended December 31, 2024. The dividend will be paid on February 28, 2025 to stockholders of record on February 14, 2025.

PROPOSED TRANSACTION WITH BERKSHIRE HILLS BANCORP, INC.

On December 16, 2024, the Company, Berkshire Hills Bancorp, Inc. (“Berkshire”), and Commerce Acquisition Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Berkshire formed solely to facilitate the merger (“Merger Sub”), entered into an Agreement and Plan of Merger (the “Merger Agreement”). The Merger Agreement provides that, upon the terms and subject to the conditions set forth therein, Merger Sub will merge with and into Brookline, with Brookline as the surviving entity, and immediately thereafter, Brookline will merge with and into Berkshire, with Berkshire as the surviving entity (collectively, the “Merger”). As a result of the Merger, the separate corporate existence of the Company will cease, and Berkshire will continue as the surviving corporation. Under the terms of the Merger Agreement, which was unanimously approved by the Boards of Directors of both companies, each outstanding share of Company common stock will be exchanged for the right to receive 0.42 shares of Berkshire common stock. Holders of Company common stock will receive cash in lieu of fractional shares of Berkshire common stock. As a result of the proposed transaction and a $100 million common stock offering by Berkshire to support the proposed transaction, Berkshire stockholders will own approximately 51%, Brookline stockholders will own approximately 45%, and investors in new shares will own approximately 4% of the outstanding shares of the combined company. The proposed transaction is expected to close by the end of the second half of 2025, subject to satisfaction of customary closing conditions, including receipt of required regulatory approvals and approvals from Berkshire and the Company stockholders.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30 PM Eastern Time on Thursday, January 30, 2025 to discuss the results for the quarter, business highlights and outlook. A copy of the Earnings Presentation is available on the Company’s website, www.brooklinebancorp.com. To listen to the call and view the Company’s Earnings Presentation, please join the call via https://events.q4inc.com/attendee/129324302. To listen to the call without access to the slides, please dial 833-470-1428 (United States) or 404-975-4839 (internationally) and ask for the Brookline Bancorp, Inc. call (Access Code 138268). A recording of the call will be available for one week following the call on the Company’s website under “Investor Relations” or by dialing 866-813-9403 (United States) or 929-458-6194 (internationally) and entering the passcode: 646121.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with approximately $11.9 billion in assets and branch locations in eastern Massachusetts, Rhode Island and the Lower Hudson Valley of New York State, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank, Bank Rhode Island, and PCSB Bank. The Company provides commercial and retail banking services and cash management and investment services to customers throughout Central New England and the Lower Hudson Valley of New York State. More information about Brookline Bancorp, Inc. and its banks can be found at the following websites: www.brooklinebank.com, www.bankri.com and www.pcsb.com.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release that are not historical facts may constitute 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, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We may also make forward-looking statements in other documents we file with the Securities and Exchange Commission (“SEC”), in our annual reports to shareholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward looking statements by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “outlook,” “will,” “should,” and other expressions that predict or indicate future events and trends and which do not relate to historical matters, including statements regarding the Company’s business, credit quality, financial condition, liquidity and results of operations. Forward-looking statements may differ, possibly materially, from what is included in this press release due to factors and future developments that are uncertain and beyond the scope of the Company’s control. These include, but are not limited to, the occurrence of any event, change or other circumstances that could give rise to the right of the Company or Berkshire to terminate the merger agreement; the outcome of any legal proceedings that may be instituted against Berkshire or Company; delays in completing the proposed transaction with Berkshire; the failure to obtain necessary regulatory approvals (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the proposed transaction) or stockholder approvals, or to satisfy any of the other conditions to the proposed transaction on a timely basis or at all, including the ability of Berkshire and the Company to meet expectations regarding the timing, completion and accounting and tax treatments of the proposed transaction; the impact of certain restrictions during the pendency of the proposed transaction on the parties’ ability to pursue certain business opportunities and strategic transactions; diversion of management’s attention from ongoing business operations and opportunities; potential adverse reactions or changes to business or employee relationships, including those resulting from the announcement or completion of the proposed transaction; changes in interest rates; general economic conditions (including inflation and concerns about liquidity) on a national basis or in the local markets in which the Company operates; turbulence in the capital and debt markets; competitive pressures from other financial institutions; changes in consumer behavior due to changing political, business and economic conditions, or legislative or regulatory initiatives; changes in the value of securities and other assets in the Company’s investment portfolio; increases in loan and lease default and charge-off rates; the adequacy of allowances for loan and lease losses; decreases in deposit levels that necessitate increases in borrowing to fund loans and investments; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters, and future pandemics; changes in regulation; the possibility that future credit losses may be higher than currently expected due to changes in economic assumptions and adverse economic developments; the risk that goodwill and intangibles recorded in the Company’s financial statements will become impaired; and changes in assumptions used in making such forward-looking statements. Forward-looking statements involve risks and uncertainties which are difficult to predict. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the risks outlined in the Company’s Annual Report on Form 10-K, as updated by its Quarterly Reports on Form 10-Q and other filings submitted to the SEC. The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

BASIS OF PRESENTATION

The Company’s consolidated financial statements have been prepared in conformity with generally accepted accounting principles (“GAAP”) as set forth by the Financial Accounting Standards Board in its Accounting Standards Codification and through the rules and interpretive releases of the SEC under the authority of federal securities laws. Certain amounts previously reported have been reclassified to conform to the current period’s presentation.

NON-GAAP FINANCIAL MEASURES

The Company uses certain non-GAAP financial measures, such as operating earnings after tax, operating earnings per common share, operating return on average assets, operating return on average tangible assets, operating return on average stockholders’ equity, operating return on average tangible stockholders’ equity, tangible book value per common share, tangible stockholders’ equity to tangible assets, return on average tangible assets (annualized) and return on average tangible stockholders’ equity (annualized). These non-GAAP financial measures provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial services sector. A detailed reconciliation table of the Company’s GAAP to the non-GAAP measures is attached.

INVESTOR RELATIONS:

Contact:

Carl M. Carlson
Brookline Bancorp, Inc.
Co-President and Chief Financial and Strategy Officer
(617) 425-5331
carl.carlson@brkl.com


BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Selected Financial Highlights (Unaudited)

	At and for the Three Months Ended															At and for the Twelve Months Ended
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
	(Dollars In Thousands Except per Share Data)
Earnings Data:
Net interest income	$	84,988		$	83,008		$	80,001		$	81,588		$	83,555		$	329,585		$	339,711
Provision for credit losses on loans		4,141			4,832			5,607			7,423			3,851			22,003			37,868
Provision (credit) for credit losses on investments		(104	)		(172	)		(39	)		(44	)		(76	)		(359	)		339
Non-interest income		6,587			6,348			6,396			6,284			8,027			25,615			31,934
Non-interest expense		63,719			57,948			59,184			61,014			59,244			241,865			239,524
Income before provision for income taxes		23,819			26,748			21,645			19,479			28,563			91,691			93,914
Net income		17,536			20,142			16,372			14,665			22,888			68,715			74,999

Performance Ratios:
Net interest margin (1)		3.12	%		3.07	%		3.00	%		3.06	%		3.15	%		3.06	%		3.24	%
Interest-rate spread (1)		2.35	%		2.26	%		2.14	%		2.21	%		2.39	%		2.24	%		2.50	%
Return on average assets (annualized)		0.61	%		0.70	%		0.57	%		0.51	%		0.81	%		0.60	%		0.67	%
Return on average tangible assets (annualized) (non-GAAP)		0.62	%		0.72	%		0.59	%		0.53	%		0.83	%		0.61	%		0.69	%
Return on average stockholders’ equity (annualized)		5.69	%		6.63	%		5.49	%		4.88	%		7.82	%		5.67	%		6.42	%
Return on average tangible stockholders’ equity (annualized) (non-GAAP)		7.21	%		8.44	%		7.04	%		6.26	%		10.12	%		7.24	%		8.36	%
Efficiency ratio (2)		69.58	%		64.85	%		68.50	%		69.44	%		64.69	%		68.09	%		64.45	%

Per Common Share Data:
Net income — Basic	$	0.20		$	0.23		$	0.18		$	0.16		$	0.26		$	0.77		$	0.85
Net income — Diluted		0.20			0.23			0.18			0.16			0.26			0.77			0.85
Cash dividends declared		0.135			0.135			0.135			0.135			0.135			0.540			0.540
Book value per share (end of period)		13.71			13.81			13.48			13.43			13.48			13.71			13.48
Tangible book value per common share (end of period) (non-GAAP)		10.81			10.89			10.53			10.47			10.50			10.81			10.50
Stock price (end of period)		11.80			10.09			8.35			9.96			10.91			11.80			10.91

Balance Sheet:
Total assets	$	11,905,326		$	11,676,721		$	11,635,292		$	11,542,731		$	11,382,256		$	11,905,326		$	11,382,256
Total loans and leases		9,779,288			9,755,236			9,721,137			9,655,086			9,641,589			9,779,288			9,641,589
Total deposits		8,901,644			8,732,271			8,737,036			8,718,653			8,548,125			8,901,644			8,548,125
Total stockholders’ equity		1,221,939			1,230,362			1,198,480			1,194,231			1,198,644			1,221,939			1,198,644

Asset Quality:
Nonperforming assets	$	70,452		$	72,821		$	62,683		$	42,489		$	45,324		$	70,452		$	45,324
Nonperforming assets as a percentage of total assets		0.59	%		0.62	%		0.54	%		0.37	%		0.40	%		0.59	%		0.40	%
Allowance for loan and lease losses	$	125,083		$	127,316		$	121,750		$	120,124		$	117,522		$	125,083		$	117,522
Allowance for loan and lease losses as a percentage of total loans and leases		1.28	%		1.31	%		1.25	%		1.24	%		1.22	%		1.28	%		1.22	%
Net loan and lease charge-offs	$	7,252		$	3,808		$	8,387		$	8,781		$	7,141		$	28,228		$	19,663
Net loan and lease charge-offs as a percentage of average loans and leases (annualized)		0.30	%		0.16	%		0.35	%		0.36	%		0.30	%		0.29	%		0.21	%

Capital Ratios:
Stockholders’ equity to total assets		10.26	%		10.54	%		10.30	%		10.35	%		10.53	%		10.26	%		10.53	%
Tangible stockholders’ equity to tangible assets (non-GAAP)		8.27	%		8.50	%		8.23	%		8.25	%		8.39	%		8.27	%		8.39	%

(1) Calculated on a fully tax-equivalent basis.
(2) Calculated as non-interest expense as a percentage of net interest income plus non-interest income.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)

	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
ASSETS	(In Thousands Except Share Data)
Cash and due from banks	$	64,673		$	82,168		$	60,067		$	45,708		$	34,514
Short-term investments		478,997			325,721			283,017			256,178			98,513
Total cash and cash equivalents		543,670			407,889			343,084			301,886			133,027
Investment securities available-for-sale		895,034			855,391			856,439			865,798			916,601
Total investment securities		895,034			855,391			856,439			865,798			916,601
Allowance for investment security losses		(82	)		(186	)		(359	)		(398	)		(441	)
Net investment securities		894,952			855,205			856,080			865,400			916,160
Loans and leases held-for-sale		—			—			—			6,717			—
Loans and leases:
Commercial real estate loans		5,716,114			5,779,290			5,782,111			5,755,239			5,764,529
Commercial loans and leases		2,506,664			2,453,038			2,443,530			2,416,904			2,399,668
Consumer loans		1,556,510			1,522,908			1,495,496			1,482,943			1,477,392
Total loans and leases		9,779,288			9,755,236			9,721,137			9,655,086			9,641,589
Allowance for loan and lease losses		(125,083	)		(127,316	)		(121,750	)		(120,124	)		(117,522	)
Net loans and leases		9,654,205			9,627,920			9,599,387			9,534,962			9,524,067
Restricted equity securities		83,155			82,675			78,963			74,709			77,595
Premises and equipment, net of accumulated depreciation		86,781			86,925			88,378			89,707			89,853
Right-of-use asset operating leases		43,527			41,934			35,691			33,133			30,863
Deferred tax asset		56,620			50,827			60,032			60,484			56,952
Goodwill		241,222			241,222			241,222			241,222			241,222
Identified intangible assets, net of accumulated amortization		17,461			19,162			20,830			22,499			24,207
Other real estate owned and repossessed assets		1,103			1,579			1,974			1,817			1,694
Other assets		282,630			261,383			309,651			310,195			286,616
Total assets	$	11,905,326		$	11,676,721		$	11,635,292		$	11,542,731		$	11,382,256
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Demand checking accounts	$	1,692,394		$	1,681,858		$	1,638,378		$	1,629,371		$	1,678,406
NOW accounts		617,246			637,374			647,370			654,748			661,863
Savings accounts		1,721,247			1,736,989			1,735,857			1,727,893			1,669,018
Money market accounts		2,116,360			2,041,185			2,073,557			2,065,569			2,082,810
Certificate of deposit accounts		1,885,444			1,819,353			1,718,414			1,670,147			1,574,855
Brokered deposit accounts		868,953			815,512			923,460			970,925			881,173
Total deposits		8,901,644			8,732,271			8,737,036			8,718,653			8,548,125
Borrowed funds:
Advances from the FHLB		1,355,926			1,345,003			1,265,079			1,150,153			1,223,226
Subordinated debentures and notes		84,328			84,293			84,258			84,223			84,188
Other borrowed funds		79,592			68,251			80,125			127,505			69,256
Total borrowed funds		1,519,846			1,497,547			1,429,462			1,361,881			1,376,670
Operating lease liabilities		44,785			43,266			37,102			34,235			31,998
Mortgagors’ escrow accounts		15,875			14,456			17,117			16,245			17,239
Reserve for unfunded credits		5,981			6,859			11,400			15,807			19,767
Accrued expenses and other liabilities		195,256			151,960			204,695			201,679			189,813
Total liabilities		10,683,387			10,446,359			10,436,812			10,348,500			10,183,612
Stockholders’ equity:
Common stock, $0.01 par value; 200,000,000 shares authorized; 96,998,075 shares issued, 96,998,075 shares issued, 96,998,075 shares issued, 96,998,075 shares issued, and 96,998,075 shares issued, respectively		970			970			970			970			970
Additional paid-in capital		902,584			901,562			904,775			903,726			902,659
Retained earnings		458,943			453,555			445,560			441,285			438,722
Accumulated other comprehensive income		(52,882	)		(38,081	)		(61,693	)		(60,841	)		(52,798	)
Treasury stock, at cost;
7,019,384 shares, 7,015,843 shares, 7,373,009 shares, 7,354,399 shares, and 7,354,399 shares, respectively		(87,676	)		(87,644	)		(91,132	)		(90,909	)		(90,909	)
Total stockholders’ equity		1,221,939			1,230,362			1,198,480			1,194,231			1,198,644
Total liabilities and stockholders’ equity	$	11,905,326		$	11,676,721		$	11,635,292		$	11,542,731		$	11,382,256

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)

	Three Months Ended
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
	(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases	$	147,436		$	149,643		$	145,585		$	145,265		$	142,948
Debt securities		6,421			6,473			6,480			6,878			6,945
Restricted equity securities		1,460			1,458			1,376			1,492			1,333
Short-term investments		2,830			1,986			1,914			1,824			1,093
Total interest and dividend income		158,147			159,560			155,355			155,459			152,319
Interest expense:
Deposits		56,562			59,796			59,721			56,884			54,034
Borrowed funds		16,597			16,756			15,633			16,987			14,730
Total interest expense		73,159			76,552			75,354			73,871			68,764
Net interest income		84,988			83,008			80,001			81,588			83,555
Provision for credit losses on loans		4,141			4,832			5,607			7,423			3,851
Credit for credit losses on investments		(104	)		(172	)		(39	)		(44	)		(76	)
Net interest income after provision for credit losses		80,951			78,348			74,433			74,209			79,780
Non-interest income:
Deposit fees		2,297			2,353			3,001			2,897			3,064
Loan fees		439			464			702			789			515
Loan level derivative income, net		1,115			—			106			437			778
Gain on sales of loans and leases		406			415			130			—			410
Other		2,330			3,116			2,457			2,161			3,260
Total non-interest income		6,587			6,348			6,396			6,284			8,027
Non-interest expense:
Compensation and employee benefits		37,202			35,130			34,762			36,629			35,401
Occupancy		5,393			5,343			5,551			5,769			5,127
Equipment and data processing		6,780			6,831			6,732			7,031			7,245
Professional services		1,345			2,143			1,745			1,900			1,442
FDIC insurance		2,017			2,118			2,025			1,884			1,839
Advertising and marketing		1,303			859			1,504			1,574			758
Amortization of identified intangible assets		1,701			1,668			1,669			1,708			1,965
Merger and restructuring expense		3,378			—			823			—			—
Other		4,600			3,856			4,373			4,519			5,467
Total non-interest expense		63,719			57,948			59,184			61,014			59,244
Income before provision for income taxes		23,819			26,748			21,645			19,479			28,563
Provision for income taxes		6,283			6,606			5,273			4,814			5,675
Net income	$	17,536		$	20,142		$	16,372		$	14,665		$	22,888
Earnings per common share:
Basic	$	0.20		$	0.23		$	0.18		$	0.16		$	0.26
Diluted	$	0.20		$	0.23		$	0.18		$	0.16		$	0.26
Weighted average common shares outstanding during the period:
Basic		89,098,443			89,033,463			88,904,692			88,894,577			88,867,159
Diluted		89,483,964			89,319,611			89,222,315			89,181,508			89,035,505
Dividends paid per common share	$	0.135		$	0.135		$	0.135		$	0.135		$	0.135

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)

	Twelve Months Ended December 31,
	2024			2023
	(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases	$	587,929		$	533,739
Debt securities		26,252			29,648
Restricted equity securities		5,786			5,571
Short-term investments		8,554			8,329
Total interest and dividend income		628,521			577,287
Interest expense:
Deposits		232,963			175,665
Borrowed funds		65,973			61,911
Total interest expense		298,936			237,576
Net interest income		329,585			339,711
Provision for credit losses on loans		22,003			37,868
(Credit) provision for credit losses on investments		(359	)		339
Net interest income after provision for credit losses		307,941			301,504
Non-interest income:
Deposit fees		10,548			11,611
Loan fees		2,394			2,036
Loan level derivative income, net		1,658			3,890
Gain on investment securities, net		—			1,704
Gain on sales of loans and leases		951			2,581
Other		10,064			10,112
Total non-interest income		25,615			31,934
Non-interest expense:
Compensation and employee benefits		143,723			138,895
Occupancy		22,056			20,203
Equipment and data processing		27,374			27,004
Professional services		7,133			7,226
FDIC insurance		8,044			7,844
Advertising and marketing		5,240			4,724
Amortization of identified intangible assets		6,746			7,840
Merger and restructuring expense		4,201			7,411
Other		17,348			18,377
Total non-interest expense		241,865			239,524
Income before provision for income taxes		91,691			93,914
Provision for income taxes		22,976			18,915
Net income	$	68,715		$	74,999
Earnings per common share:
Basic	$	0.77		$	0.85
Diluted	$	0.77		$	0.85
Weighted average common shares outstanding during the period:
Basic		88,983,248			88,230,681
Diluted		89,302,304			88,450,646
Dividends paid per common share	$	0.540		$	0.540

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Asset Quality Analysis (Unaudited)

	At and for the Three Months Ended
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023
	(Dollars in Thousands)
NONPERFORMING ASSETS:
Loans and leases accounted for on a nonaccrual basis:
Commercial real estate mortgage	$	11,525		$	11,595		$	11,659		$	18,394		$	19,608
Multi-family mortgage		6,596			1,751			—			—			—
Construction		—			—			—			—			—
Total commercial real estate loans		18,121			13,346			11,659			18,394			19,608

Commercial		14,676			15,734			16,636			3,096			3,886
Equipment financing		31,509			37,223			27,128			13,668			14,984
Total commercial loans and leases		46,185			52,957			43,764			16,764			18,870

Residential mortgage		3,999			3,862			4,495			4,563			4,292
Home equity		1,043			1,076			790			950			860
Other consumer		1			1			1			1			—
Total consumer loans		5,043			4,939			5,286			5,514			5,152

Total nonaccrual loans and leases		69,349			71,242			60,709			40,672			43,630

Other real estate owned		700			780			780			780			780
Other repossessed assets		403			799			1,194			1,037			914
Total nonperforming assets	$	70,452		$	72,821		$	62,683		$	42,489		$	45,324

Loans and leases past due greater than 90 days and still accruing	$	811		$	16,091		$	4,994		$	363		$	228

Nonperforming loans and leases as a percentage of total loans and leases		0.71	%		0.73	%		0.62	%		0.42	%		0.45	%
Nonperforming assets as a percentage of total assets		0.59	%		0.62	%		0.54	%		0.37	%		0.40	%

PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:
Allowance for loan and lease losses at beginning of period	$	127,316		$	121,750		$	120,124		$	117,522		$	119,081
Charge-offs		(8,414	)		(4,183	)		(8,823	)		(5,390	)		(7,722	)
Recoveries		1,162			375			436			309			581
Net charge-offs		(7,252	)		(3,808	)		(8,387	)		(5,081	)		(7,141	)
Provision for loan and lease losses excluding unfunded commitments *		5,019			9,374			10,013			7,683			5,582
Allowance for loan and lease losses at end of period	$	125,083		$	127,316		$	121,750		$	120,124		$	117,522

Allowance for loan and lease losses as a percentage of total loans and leases		1.28	%		1.31	%		1.25	%		1.24	%		1.22	%

NET CHARGE-OFFS:
Commercial real estate loans	$	—		$	—		$	3,819		$	606		$	1,087
Commercial loans and leases **		7,257			3,797			4,571			8,179			6,061
Consumer loans		(5	)		11			(3	)		(4	)		(7	)
Total net charge-offs	$	7,252		$	3,808		$	8,387		$	8,781		$	7,141

Net loan and lease charge-offs as a percentage of average loans and leases (annualized)		0.30	%		0.16	%		0.35	%		0.36	%		0.30	%

*Provision for loan and lease losses does not include (credit) provision of $(0.9 million), $(4.5 million), $(4.4 million), $(0.3 million), and $(1.7 million) for credit losses on unfunded commitments during the three months ended December 31, 2024, September 30, 2024, June 30, 2024, March 31, 2024, and December 31, 2023, respectively.
** The balance at March 31, 2024 includes a $3.7 million charge-off on a letter of credit which impacted the provision.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)

	Three Months Ended
	December 31, 2024						September 30, 2024						December 31, 2023
	Average Balance		Interest (1)		Average Yield/ Cost		Average Balance		Interest (1)		Average Yield/ Cost		Average Balance		Interest (1)		Average Yield/ Cost
	(Dollars in Thousands)
Assets:
Interest-earning assets:
Investments:
Debt securities (2)	$	856,065	$	6,463	3.02	%	$	853,924	$	6,516	3.05	%	$	876,350	$	6,986	3.19	%
Restricted equity securities (2)		75,879		1,459	7.69	%		75,225		1,459	7.76	%		67,567		1,334	7.90	%
Short-term investments		236,784		2,830	4.78	%		145,838		1,986	5.44	%		85,790		1,093	5.09	%
Total investments		1,168,728		10,752	3.68	%		1,074,987		9,961	3.71	%		1,029,707		9,413	3.66	%
Loans and Leases:
Commercial real estate loans (3)		5,752,591		81,195	5.52	%		5,772,456		83,412	5.65	%		5,727,930		81,653	5.58	%
Commercial loans (3)		1,170,295		19,750	6.61	%		1,079,084		18,440	6.69	%		969,603		16,296	6.58	%
Equipment financing (3)		1,310,143		26,295	8.03	%		1,353,649		26,884	7.94	%		1,347,589		25,211	7.48	%
Consumer loans (3)		1,529,654		20,881	5.44	%		1,505,095		21,123	5.60	%		1,475,580		19,888	5.37	%
Total loans and leases		9,762,683		148,121	6.07	%		9,710,284		149,859	6.17	%		9,520,702		143,048	6.01	%
Total interest-earning assets		10,931,411		158,873	5.81	%		10,785,271		159,820	5.93	%		10,550,409		152,461	5.78	%
Non-interest-earning assets		649,161						666,067						721,532
Total assets	$	11,580,572					$	11,451,338					$	11,271,941

Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts	$	630,408		1,056	0.67	%	$	639,561		1,115	0.69	%	$	657,134		1,146	0.69	%
Savings accounts		1,741,355		10,896	2.49	%		1,738,756		12,098	2.77	%		1,658,144		10,684	2.56	%
Money market accounts		2,083,033		13,856	2.65	%		2,038,048		15,466	3.02	%		2,140,225		16,239	3.01	%
Certificates of deposit		1,857,483		20,691	4.43	%		1,768,026		20,054	4.51	%		1,530,772		14,517	3.76	%
Brokered deposit accounts		797,910		10,063	5.02	%		841,067		11,063	5.23	%		880,604		11,448	5.16	%
Total interest-bearing deposits		7,110,189		56,562	3.16	%		7,025,458		59,796	3.39	%		6,866,879		54,034	3.12	%
Borrowings:
Advances from the FHLB		1,144,157		13,958	4.77	%		1,139,049		14,366	4.94	%		965,846		11,943	4.84	%
Subordinated debentures and notes		84,311		1,944	9.22	%		84,276		1,378	6.54	%		84,170		1,381	6.56	%
Other borrowed funds		65,947		695	4.20	%		53,102		1,012	7.58	%		136,566		1,406	4.09	%
Total borrowings		1,294,415		16,597	5.02	%		1,276,427		16,756	5.14	%		1,186,582		14,730	4.86	%
Total interest-bearing liabilities		8,404,604		73,159	3.46	%		8,301,885		76,552	3.67	%		8,053,461		68,764	3.39	%
Non-interest-bearing liabilities:
Demand checking accounts		1,693,138						1,669,092						1,723,849
Other non-interest-bearing liabilities		250,303						264,324						323,855
Total liabilities		10,348,045						10,235,301						10,101,165
Stockholders’ equity		1,232,527						1,216,037						1,170,776
Total liabilities and equity	$	11,580,572					$	11,451,338					$	11,271,941
Net interest income (tax-equivalent basis) /Interest-rate spread (4)				85,714	2.35	%				83,268	2.26	%				83,697	2.39	%
Less adjustment of tax-exempt income				726						260						142
Net interest income			$	84,988					$	83,008					$	83,555
Net interest margin (5)					3.12	%					3.07	%					3.15	%

(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)

	Twelve Months Ended
	December 31, 2024						December 31, 2023
	Average Balance		Interest (1)		Average Yield/ Cost		Average Balance		Interest (1)		Average Yield/ Cost
	(Dollars in Thousands)
Assets:
Interest-earning assets:
Investments:
Debt securities (2)	$	862,381	$	26,416	3.06	%	$	947,782	$	29,891	3.15	%
Restricted equity securities (2)		74,788		5,786	7.74	%		72,264		5,572	7.71	%
Short-term investments		164,445		8,554	5.20	%		158,718		8,329	5.25	%
Total investments		1,101,614		40,756	3.70	%		1,178,764		43,792	3.72	%
Loans and Leases:
Commercial real estate loans (3)		5,760,432		327,221	5.59	%		5,654,385		307,652	5.37	%
Commercial loans (3)		1,086,460		73,369	6.65	%		929,077		59,110	6.28	%
Equipment financing (3)		1,352,993		106,329	7.86	%		1,277,224		92,112	7.21	%
Consumer loans (3)		1,501,626		82,273	5.47	%		1,470,677		75,098	5.10	%
Total loans and leases		9,701,511		589,192	6.07	%		9,331,363		533,972	5.72	%
Total interest-earning assets		10,803,125		629,948	5.83	%		10,510,127		577,764	5.50	%
Non-interest-earning assets		670,299						704,244
Total assets	$	11,473,424					$	11,214,371

Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts	$	650,225		4,543	0.70	%	$	720,572		4,275	0.59	%
Savings accounts		1,726,504		46,220	2.68	%		1,439,293		27,974	1.94	%
Money market accounts		2,056,066		60,796	2.96	%		2,205,430		58,153	2.64	%
Certificates of deposit		1,737,697		76,134	4.38	%		1,428,727		44,122	3.09	%
Brokered deposit accounts		873,182		45,270	5.18	%		819,419		41,141	5.02	%
Total interest-bearing deposits		7,043,674		232,963	3.31	%		6,613,441		175,665	2.66	%
Borrowings:
Advances from the FHLB		1,124,432		55,851	4.89	%		1,092,996		52,467	4.73	%
Subordinated debentures and notes		84,258		6,074	7.21	%		84,116		5,476	6.51	%
Other borrowed funds		78,859		4,048	5.13	%		124,793		3,968	3.18	%
Total borrowings		1,287,549		65,973	5.04	%		1,301,905		61,911	4.69	%
Total interest-bearing liabilities		8,331,223		298,936	3.59	%		7,915,346		237,576	3.00	%
Non-interest-bearing liabilities:
Demand checking accounts		1,657,922						1,823,759
Other non-interest-bearing liabilities		273,243						307,160
Total liabilities		10,262,388						10,046,265
Stockholders’ equity		1,211,036						1,168,106
Total liabilities and equity	$	11,473,424					$	11,214,371
Net interest income (tax-equivalent basis) /Interest-rate spread (4)				331,012	2.24	%				340,188	2.50	%
Less adjustment of tax-exempt income				1,427						477
Net interest income			$	329,585					$	339,711
Net interest margin (5)					3.06	%					3.24	%

(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)

										At and for the Three Months Ended December 31,						At and for the Twelve Months Ended December 31,
										2024			2023			2024			2023
Reconciliation Table – Non-GAAP Financial Information										(Dollars in Thousands Except Share Data)

Reported Pretax Income										$	23,819		$	28,563		$	91,691		$	93,914
Less:
Security gains											—			—			—			1,704
Add:
Day 1 PCSB CECL provision											—			—			—			16,744
Merger and acquisition expenses											3,378			—			4,201			7,411
Operating Pretax income										$	27,197		$	28,563		$	95,892		$	116,365
Effective tax rate											23.9	%		19.9	%		24.5	%		20.1	%
Provision for income tax											6,511			5,675			23,480			23,437
Operating earnings after tax										$	20,686		$	22,888		$	72,412		$	92,928

Operating earnings per common share:
Basic										$	0.23		$	0.26		$	0.81		$	1.05
Diluted										$	0.23		$	0.26		$	0.81		$	1.05

Weighted average common shares outstanding during the period:
Basic											89,098,443			88,867,159			88,983,248			88,230,681
Diluted											89,483,964			89,035,505			89,302,304			88,450,646


Return on average assets *											0.61	%		0.81	%		0.60	%		0.67	%
Less:
Security gains (after-tax) *											—	%		—	%		—	%		0.01	%
Add:
Day 1 PCSB CECL provision (after-tax) *											—	%		—	%		—	%		0.12	%
Merger and acquisition expenses (after-tax) *											0.09	%		—	%		0.03	%		0.05	%
Operating return on average assets *											0.70	%		0.81	%		0.63	%		0.83	%


Return on average tangible assets *											0.62	%		0.83	%		0.61	%		0.69	%
Less:
Security gains (after-tax) *											—	%		—	%		—	%		0.01	%
Add:
Day 1 PCSB CECL provision (after-tax) *											—	%		—	%		—	%		0.12	%
Merger and acquisition expenses (after-tax) *											0.09	%		—	%		0.03	%		0.05	%
Operating return on average tangible assets *											0.71	%		0.83	%		0.64	%		0.85	%


Return on average stockholders’ equity *											5.69	%		7.82	%		5.67	%		6.42	%
Less:
Security gains (after-tax) *											—	%		—	%		—	%		0.12	%
Add:
Day 1 PCSB CECL provision (after-tax) *											—	%		—	%		—	%		1.14	%
Merger and acquisition expenses (after-tax) *											0.83	%		—	%		0.26	%		0.51	%
Operating return on average stockholders’ equity *											6.52	%		7.82	%		5.93	%		7.95	%


Return on average tangible stockholders’ equity *											7.21	%		10.12	%		7.24	%		8.36	%
Less:
Security gains (after-tax) *											—	%		—	%		—	%		0.15	%
Add:
Day 1 PCSB CECL provision (after-tax) *											—	%		—	%		—	%		1.49	%
Merger and acquisition expenses (after-tax) *											1.06	%		—	%		0.33	%		0.66	%
Operating return on average tangible stockholders’ equity *											8.27	%		10.12	%		7.57	%		10.36	%
* Ratios at and for the three months ended are annualized.

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)

	At and for the Three Months Ended															At and for the Twelve Months Ended
	December 31, 2024			September 30, 2024			June 30, 2024			March 31, 2024			December 31, 2023			December 31, 2024			December 31, 2023
	(Dollars in Thousands)

Net income, as reported	$	17,536		$	20,142		$	16,372		$	14,665		$	22,888		$	68,715		$	74,999

Average total assets	$	11,580,572		$	11,451,338		$	11,453,394		$	11,417,185		$	11,271,941		$	11,473,424		$	11,214,371
Less: Average goodwill and average identified intangible assets, net		259,496			261,188			262,859			264,536			266,225			262,011			270,637
Average tangible assets	$	11,321,076		$	11,190,150		$	11,190,535		$	11,152,649		$	11,005,716		$	11,211,413		$	10,943,734

Return on average tangible assets (annualized)		0.62	%		0.72	%		0.59	%		0.53	%		0.83	%		0.61	%		0.69	%

Average total stockholders’ equity	$	1,232,527		$	1,216,037		$	1,193,385		$	1,201,904		$	1,170,776		$	1,211,036		$	1,168,106
Less: Average goodwill and average identified intangible assets, net		259,496			261,188			262,859			264,536			266,225			262,011			270,637
Average tangible stockholders’ equity	$	973,031		$	954,849		$	930,526		$	937,368		$	904,551		$	949,025		$	897,469

Return on average tangible stockholders’ equity (annualized)		7.21	%		8.44	%		7.04	%		6.26	%		10.12	%		7.24	%		8.36	%

Total stockholders’ equity	$	1,221,939		$	1,230,362		$	1,198,480		$	1,194,231		$	1,198,644		$	1,221,939		$	1,198,644
Less:
Goodwill		241,222			241,222			241,222			241,222			241,222			241,222			241,222
Identified intangible assets, net		17,461			19,162			20,830			22,499			24,207			17,461			24,207
Tangible stockholders’ equity	$	963,256		$	969,978		$	936,428		$	930,510		$	933,215		$	963,256		$	933,215

Total assets	$	11,905,326		$	11,676,721		$	11,635,292		$	11,542,731		$	11,382,256		$	11,905,326		$	11,382,256
Less:
Goodwill		241,222			241,222			241,222			241,222			241,222			241,222			241,222
Identified intangible assets, net		17,461			19,162			20,830			22,499			24,207			17,461			24,207
Tangible assets	$	11,646,643		$	11,416,337		$	11,373,240		$	11,279,010		$	11,116,827		$	11,646,643		$	11,116,827

Tangible stockholders’ equity to tangible assets		8.27	%		8.50	%		8.23	%		8.25	%		8.39	%		8.27	%		8.39	%

Tangible stockholders’ equity	$	963,256		$	969,978		$	936,428		$	930,510		$	933,215		$	963,256		$	933,215

Number of common shares issued		96,998,075			96,998,075			96,998,075			96,998,075			96,998,075			96,998,075			96,998,075
Less:
Treasury shares		7,019,384			7,015,843			7,373,009			7,354,399			7,354,399			7,019,384			7,354,399
Unvested restricted shares		880,248			883,789			713,443			749,099			749,099			880,248			749,099
Number of common shares outstanding		89,098,443			89,098,443			88,911,623			88,894,577			88,894,577			89,098,443			88,894,577

Tangible book value per common share	$	10.81		$	10.89		$	10.53		$	10.47		$	10.50		$	10.81		$	10.50

PDF available: http://ml.globenewswire.com/Resource/Download/396afece-df5e-4cc5-a637-0706599b2b0d

The MIL Network –

January 30, 2025

MIL-OSI: NorthEast Community Bancorp, Inc. Reports Results for the Fourth Quarter and Year Ended December 31, 2024

Source: GlobeNewswire (MIL-OSI)

WHITE PLAINS, N.Y., Jan. 29, 2025 (GLOBE NEWSWIRE) — NorthEast Community Bancorp, Inc. (Nasdaq: NECB) (the “Company”), the parent holding company of NorthEast Community Bank (the “Bank”), generated net income of $10.9 million, or $0.83 per basic share and $0.80 per diluted share, for the fourth quarter ended December 31, 2024 compared to net income of $12.1 million, or $0.82 per basic and diluted share, for the fourth quarter ended December 31, 2023. In addition, the Company generated net income of $47.8 million, or $3.64 per basic share and $3.58 per diluted share, for the year ended December 31, 2024 compared to net income of $46.3 million, or $3.32 per basic share and diluted share, for the year ended December 31, 2023.

Kenneth A. Martinek, Chairman of the Board and Chief Executive Officer, stated “We are pleased to report another quarter of strong earnings due to the strong performance of our loan portfolio. Despite the challenging high interest rate environment during 2023 that continued into most of 2024, loan demand remained strong with originations and outstanding commitments remaining robust. As has been in the past, construction lending in high demand-high absorption areas continues to be our focus.”

Highlights for the fourth quarter and the year ended December 31, 2024 are as follows:

Performance metrics continue to be strong with a return on average total assets ratio of 2.19%, a return on average shareholders’ equity ratio of 13.80%, and an efficiency ratio of 38.99% for the quarter ended December 31, 2024. For the year ended December 31, 2024, the Company generated a return on average total assets ratio of 2.50%, a return on average shareholders’ equity ratio of 15.83%, and an efficiency ratio of 37.00%.
Net interest income increased by $91,000 and $5.6 million, or 0.4% and 5.8%, respectively, for the quarter and year ended December 31, 2024 compared to the same periods in 2023.
Our net loans receivable increased by $227.0 million, or 14.3%, to $1.8 billion at December 31, 2024 compared to $1.6 billion at December 31, 2023.

Balance Sheet Summary

Total assets increased $246.2 million, or 14.0%, to $2.0 billion at December 31, 2024, from $1.8 billion at December 31, 2023. The increase in assets was primarily due to increases in net loans of $227.0 million, cash and cash equivalents of $9.6 million, equity securities of $3.9 million, real estate owned of $3.7 million, and other assets of $3.3 million.

Cash and cash equivalents increased $9.6 million, or 14.0%, to $78.3 million at December 31, 2024 from $68.7 million at December 31, 2023. The increase in cash and cash equivalents was a result of an increase in deposits of $270.3 million, partially offset by a decrease in borrowings of $64.0 million, an increase of $227.0 million in net loans, dividends to shareholders of $8.7 million, and stock repurchases of $2.4 million.

Equity securities increased $3.9 million, or 21.5%, to $22.0 million at December 31, 2024 from $18.1 million at December 31, 2023. The increase in equity securities was attributable to the purchase of $4.0 million in equity securities during the second half of 2024, offset by market depreciation of $109,000 due to market interest rate volatility during the year ended December 31, 2024.

Securities held-to-maturity decreased $1.2 million, or 7.8%, to $14.6 million at December 31, 2024 from $15.9 million at December 31, 2023 due to $1.2 million in maturities and pay-downs of various investment securities, partially offset by a decrease of $10,000 in the allowance for credit losses for held-to-maturity securities.

Loans, net of the allowance for credit losses, increased $227.0 million, or 14.3%, to $1.8 billion at December 31, 2024 from $1.6 billion at December 31, 2023. The increase in loans, net of the allowance for credit losses, was primarily due to loan originations of $656.0 million during the year ended December 31, 2024, consisting primarily of $573.8 million in construction loans with respect to which approximately 36.3% of the funds were disbursed at loan closings, with the remaining funds to be disbursed over the terms of the construction loans. In addition, during the year ended December 31, 2024, we originated $54.9 million in commercial and industrial loans, $14.0 million in non-residential loans, $12.6 million in multi-family loans, and $600,000 in mixed-use loans. We also originated $9.2 million in letters of credit.

Loan originations during the year ended December 31, 2024 resulted in a net increase of $206.8 million in construction loans, $8.6 million in commercial and industrial loans, $8.3 million in non-residential loans, $7.7 million in multi-family loans, and $409,000 in consumer loans. The increase in our loan portfolio was partially offset by decreases of $3.1 million in mixed-use loans and $1.8 million in residential loans, coupled with normal pay-downs and principal reductions.

The allowance for credit losses related to loans decreased to $4.8 million as of December 31, 2024, from $5.1 million as of December 31, 2023. The decrease in the allowance for credit losses related to loans was due to charge-offs totaling $347,000, offset by provision for credit losses totaling $84,000.

Premises and equipment decreased $647,000, or 2.5%, to $24.8 million at December 31, 2024 from $25.5 million at December 31, 2023 primarily due to the depreciation of fixed assets.

Investments in Federal Home Loan Bank stock decreased $532,000, or 57.3%, to $397,000 at December 31, 2024 from $929,000 at December 31, 2023. The decrease was due primarily to the mandatory redemption of Federal Home Loan Bank stock totaling $630,000 in connection with the maturity of $14.0 million in advances in 2024, offset by purchases of Federal Home Loan Bank stock totaling $98,000 due to the growth of our mortgage loan portfolio.

Bank owned life insurance (“BOLI”) increased $656,000, or 2.6%, to $25.7 million at December 31, 2024 from $25.1 million at December 31, 2023 due to increases in the BOLI cash value.

Accrued interest receivable increased $1.2 million, or 9.5%, to $13.5 million at December 31, 2024 from $12.3 million at December 31, 2023 due to an increase in the loan portfolio.

Real estate owned increased $3.7 million, or 251.6%, to $5.1 million at December 31, 2024 from $1.5 million at December 31, 2023 due to foreclosure of a property, with a book value of $4.4 million, located in the Bronx, New York, offset by charge-offs totaling $689,000 resulting from a decrease in the estimated fair value of a foreclosed property located in Pittsburgh, Pennsylvania.

Right of use assets — operating decreased $565,000, or 12.4%, to $4.0 million at December 31, 2024 from $4.6 million at December 31, 2023, primarily due to amortization.

Other assets increased $3.3 million, or 40.5%, to $11.3 million at December 31, 2024 from $8.0 million at December 31, 2023 due to increases of $2.8 million in tax assets, $476,000 in suspense accounts, and $6,000 in miscellaneous assets, partially offset by decreases of $40,000 in prepaid expenses and $2,000 in securities receivables.

Total deposits increased $270.3 million, or 19.3%, to $1.7 billion at December 31, 2024 from $1.4 billion at December 31, 2023. The increase in deposits was primarily due to the Bank offering competitive interest rates to attract deposits. This resulted in a shift in deposits whereby certificates of deposit increased $239.7 million, or 31.5%, and NOW/money market accounts increased $98.0 million, or 67.4%, partially offset by decreases in savings account balances of $54.3 million, or 28.2%, and non-interest bearing demand deposits of $14.7 million, or 4.9%.

Federal Reserve Bank borrowings of $50.0 million at December 31, 2023 and Federal Home Loan Bank advances of $14.0 million at December 31, 2023 were paid-off during the year ended December 31, 2024.

Advance payments by borrowers for taxes and insurance decreased $402,000, or 19.9%, to $1.6 million at December 31, 2024 from $2.0 million at December 31, 2023 due primarily to real estate tax payments for borrowers.

Lease liability – operating decreased $517,000, or 11.2%, to $4.1 million at December 31, 2024 from $4.6 million at December 31, 2023, primarily due to amortization.

Accounts payable and accrued expenses increased $972,000, or 7.2%, to $14.5 million at December 31, 2024 from $13.6 million at December 31, 2023 due primarily to increases in dividends payable and other payables of $856,000 and deferred compensation of $729,000, partially offset by decreases in accrued interest expense of $102,000, suspense account for loan closings of $99,000, and accrued expense of $79,000. The allowance for credit losses for off-balance sheet commitments decreased $333,000, or 32.1%, to $704,000 at December 31, 2024 from $1.0 million at December 31, 2023.

Stockholders’ equity increased $39.7 million, or 14.2% to $319.1 million at December 31, 2024, from $279.3 million at December 31, 2023. The increase in stockholders’ equity was due to net income of $47.8 million for the year ended December 31, 2024, the amortization expense of $2.0 million relating to restricted stock and stock options granted under the Company’s 2022 Equity Incentive Plan, an increase of $1.3 million in earned employee stock ownership plan shares coupled with a reduction of $475,000 in unearned employee stock ownership plan shares, and an exercise of stock options totaling $14,000, partially offset by dividends paid and declared of $8.7 million, stock repurchases and stock repurchase excise taxes totaling $2.5 million, awarding restricted stock totaling $725,000. and $93,000 in other comprehensive income.

Results of Operations for the Quarter Ended December 31, 2024 and 2023

Net Interest Income

Net interest income was $25.3 million for the quarter ended December 31, 2024, as compared to $25.2 million for the quarter ended December 31, 2023. The increase in net interest income of $92,000, or 0.4%, was primarily due to an increase in interest income that exceeded an increase in interest expense.

The increase in interest income is attributable to increases in the average balances of loans, interest-bearing deposits, and investment securities, partially offset by a decrease in the average balances of FHLB stock. However, the Federal Reserve’s decrease of interest rates starting in September 2024 impacted the yield on our interest earning assets.

The increase in market interest rates in 2023 that continued until September 2024 also caused an increase in our interest expense. As a result, the increase in interest expense for the quarter ended December 31, 2024 was due to an increase in the cost of funds on our deposits. The increase in interest expense was also due to an increase in the average balances on our certificates of deposits and our interest-bearing demand deposits, offset by a decrease in the average balances on our savings and club deposits and our borrowed money.

Total interest and dividend income increased $3.3 million, or 9.0%, to $40.5 million for the quarter ended December 31, 2024 from $37.1 million for the quarter ended December 31, 2023. The increase in interest and dividend income was due to an increase in the average balance of interest earning assets of $249.5 million, or 15.0%, to $1.9 billion for the quarter ended December 31, 2024 from $1.7 billion for the quarter ended December 31, 2023, partially offset by a decrease in the yield on interest earning assets by 47 basis points from 8.93% for the quarter ended December 31, 2023 to 8.46% for the quarter ended December 31, 2024.

Interest expense increased $3.3 million, or 27.3%, to $15.2 million for the quarter ended December 31, 2024 from $11.9 million for the quarter ended December 31, 2023. The increase in interest expense was due to an increase in the cost of interest bearing liabilities by 20 basis points from 4.14% for the quarter ended December 31, 2023 to 4.34% for the quarter ended December 31, 2024 and an increase in average interest bearing liabilities of $247.3 million, or 21.5%, to $1.4 billion for the quarter ended December 31, 2024 from $1.2 billion for the quarter ended December 31, 2023.

Our net interest margin decreased 77 basis points, or 12.7%, to 5.29% for the quarter ended December 31, 2024 compared to 6.06% for the quarter ended December 31, 2023. The decrease in the net interest margin was due to an increase in the cost of funds on interest-bearing liabilities and a decrease in the yield on interest-earning assets.

Credit Loss Expense

The Company recorded a credit loss expense of $26,000 for the quarter ended December 31, 2024 compared to a credit loss expense of $205,000 for the quarter ended December 31, 2023. The credit loss expense of $26,000 for the quarter ended December 31, 2024 was comprised of credit loss expense for loans of $230,000 due to charge-offs of $232,000 in unpaid overdrafts in our demand deposit accounts, offset by credit loss expense reduction for off-balance sheet commitments of $204,000 primarily attributable to a decrease in the aggregate unfunded off-balance sheet commitments.

The credit loss expense of $205,000 for the three months ended December 31, 2023 was comprised of credit loss expense for loans of $352,000 and credit loss expense for held-to-maturity investment securities of $6,000, partially offset by credit loss expense reduction for off-balance sheet commitments of $153,000.

With respect to the allowance for credit losses for loans, we charged-off $232,000 during the quarter ended December 31, 2024 as compared to charge-offs of $27,000 during the quarter ended December 31, 2023. The charge-offs during both periods were against various unpaid overdrafts in our demand deposit accounts.

We recorded no recoveries from previously charged-off loans during the quarter ended December 31, 2024 and 2023.

Non-Interest Income

Non-interest income for the quarter ended December 31, 2024 was $149,000 compared to non-interest income of $1.4 million for the quarter ended December 31, 2023. The decrease of $1.2 million, or 89.2%, in total non-interest income was primarily due to decreases of $1.2 million in unrealized gain (loss) on equity securities, $115,000 in investment advisory fees, and $12,000 in miscellaneous other non-interest income, partially offset by increases of $40,000 from sale/disposition of fixed assets, $14,000 in BOLI income, and $11,000 in other loan fees and service charges.

The increase in unrealized gain (loss) on equity securities was due to an unrealized loss of $554,000 on equity securities during the quarter ended December 31, 2024 compared to an unrealized gain of $621,000 on equity securities during the quarter ended December 31, 2023. The unrealized loss of $554,000 on equity securities during the quarter ended December 31, 2024 was due to market interest rate volatility during the quarter ended December 31, 2024.

The decrease in investment advisory fees was due to the disposition in January 2024 of the Bank’s assets relating to the Harbor West Wealth Management Group. As a result of the transaction, the Bank no longer generates investment advisory fees.

Regarding the sale/disposition of fixed assets, we recorded gains of $22,000 during the quarter ended December 31, 2024 compared to losses of $18,000 during the quarter ended December 31, 2023.

The increase in BOLI income of $14,000 was due to an increase in the yield on BOLI assets.

The increase of $11,000 in other loan fees and service charges was due to an increase of $24,000 in ATM/debit card/ACH fees and an increase of $2,000 in deposit account fees, partially offset by a decrease of $15,000 in other loan fees and loan servicing fees.

Non-Interest Expense

Non-interest expense increased $688,000, or 7.5%, to $9.9 million for the quarter ended December 31, 2024 from $9.2 million for the quarter ended December 31, 2023. The increase resulted primarily from increases of $444,000 in salaries and employee benefits, $163,000 in real estate owned expense, $108,000 in outside data processing expense, $79,000 in other operating expense, $18,000 in equipment expense, $7,000 in occupancy expense, and $7,000 in advertising expense, partially offset by a decrease of $138,000 in loss on the disposition of the Bank’s assets relating to the Harbor West Wealth Management Group.

Income Taxes

We recorded income tax expense of $4.6 million and $5.1 million for the quarter ended December 31, 2024 and 2023, respectively. For the quarter ended December 31, 2024, we had approximately $205,000 in tax exempt income, compared to approximately $190,000 in tax exempt income for the quarter ended December 31, 2023. Our effective income tax rates were 29.5% for the quarter ended December 31, 2024 and 2023, respectively.

Results of Operations for the Year Ended December 31, 2024 and 2023

Net Interest Income

Net interest income was $102.8 million for the year ended December 31, 2024 as compared to $97.2 million for the year ended December 31, 2023. The increase in net interest income of $5.6 million, or 5.8%, was primarily due to an increase in interest income that exceeded an increase in interest expense.

The increase in interest income is attributable to increases in loans and interest-bearing deposits, partially offset by decreases in investment securities and FHLB stock. The increase in interest income is also attributable to the Federal Reserve’s interest rate increases during 2023 that continued until September 2024. However, the Federal Reserve’s decrease of interest rates starting in September 2024 impacted the yield on our interest earning assets.

The increase in market interest rates in 2023 that continued until September 2024 also caused an increase in our interest expense. As a result, the increase in interest expense for the year ended December 31, 2024 was due to an increase in the cost of funds on our deposits and borrowed money. The increase in interest expense was also due to increases in the average balances on our certificates of deposits, our interest-bearing demand deposits, and our borrowed money, offset by a decrease in the average balance of our savings and club deposits.

Total interest and dividend income increased $27.5 million, or 20.8%, to $160.0 million for the year ended December 31, 2024 from $132.5 million for the year ended December 31, 2023. The increase in interest and dividend income was due to an increase in the average balance of interest earning assets of $312.3 million, or 20.6%, to $1.8 billion for the year ended December 31, 2024 from $1.5 billion for the year ended December 31, 2023 and an increase in the yield on interest earning assets by two basis points from 8.73% for the year ended December 31, 2023 to 8.75% for the year ended December 31, 2024.

Interest expense increased $21.9 million, or 62.1%, to $57.2 million for the year ended December 31, 2024 from $35.3 million for the year ended December 31, 2023. The increase in interest expense was due to an increase in the cost of interest bearing liabilities by 77 basis points from 3.58% for the year ended December 31, 2023 to 4.35% for the year ended December 31, 2024, and an increase in average interest bearing liabilities of $328.9 million, or 33.3%, to $1.3 billion for the year ended December 31, 2024 from $986.3 million for the year ended December 31, 2023.

Net interest margin decreased 79 basis points, or 12.3%, for the year ended December 31, 2024 to 5.62% compared to 6.41% for the year ended December 31, 2023.

Credit Loss Expense

The Company recorded a credit loss expense reduction totaling $260,000 for the year ended December 31, 2024 compared to a credit loss expense totaling $972,000 for the year ended December 31, 2023. The credit loss expense reduction of $260,000 for the year ended December 31, 2024 was comprised of a credit loss expense reduction for off-balance sheet commitments of $334,000 and a credit loss expense reduction for held-to-maturity investment securities of $10,000, offset by a credit loss expense for loans of $84,000.

The credit loss expense reduction for off-balance sheet commitments of $334,000 for the year ended December 31, 2024 was primarily attributed to a reduction of $157.6 million in the level of off-balance sheet commitments. The credit loss expense reduction for held-to-maturity investment securities of $10,000 for the year ended December 31, 2024 was primarily attributed to a reduction of $708,000 in the level of applicable held-to-maturity investment securities.

The credit loss expense for loans of $84,000 for the year ended December 31, 2024 was primarily attributed to charge-offs totaling $347,000, partially offset by favorable trends in the economy.

The credit loss expense of $972,000 for the year ended December 31, 2023 was comprised of credit loss expense for loans of $1.5 million and credit loss expense for held-to-maturity investment securities of $5,000, partially offset by a credit loss expense reduction for off-balance sheet commitments of $548,000.

We charged-off $347,000 during the year ended December 31, 2024 as compared to charge-offs of $313,000 during the year ended December 31, 2023. The charge-offs of $347,000 during the year ended December 31, 2024 were against various unpaid overdrafts in our demand deposit accounts. The charge-offs of $312,000 during the year ended December 31, 2023 were comprised of a charge-off of $159,000 related to three performing construction loans on the same project whereby we sold the loans to a third-party at a loss of $159,000. The remaining charge-offs of $153,000 for the 2023 period were against various unpaid overdrafts in our demand deposit accounts.

We recorded no recoveries from previously charged-off loans during the year ended December 31, 2024 and 2023.

Non-Interest Income

Non-interest income for the year ended December 31, 2024 was $2.8 million compared to non-interest income of $3.7 million for the year ended December 31, 2023. The decrease of $960,000, or 25.6%, in total non-interest income was primarily due to decreases of $458,000 in investment advisory fees, $403,000 in unrealized gains (losses) on equity securities, and $357,000 in BOLI income, partially offset by increases of $207,000 in other loan fees and service charges, $40,000 from sale/disposition of fixed assets, and $11,000 in miscellaneous other non-interest income.

The decrease in investment advisory fees was due to the disposition in January 2024 of the Bank’s assets relating to the Harbor West Wealth Management Group. As a result of the transaction, the Bank no longer generates investment advisory fees. The decrease in unrealized gain (loss) on equity securities was due to an unrealized loss of $109,000 on equity securities during the year ended December 31, 2024 compared to an unrealized gain of $294,000 on equity securities during the year ended December 31, 2023. The unrealized loss of $109,000 on equity securities during the 2024 period was due to market interest rate volatility during the year ended December 31, 2024.

The decrease in BOLI income was primarily due to two death claims totaling $1.8 million on BOLI policies that resulted in additional BOLI income of $404,000 in the year ended December 31, 2023.

The increase of $207,000 in other loan fees and service charges was due to increases of $148,000 in other loan fees and loan servicing fees, $51,000 in ATM/debit card/ACH fees, and $7,000 in deposit account fees.

Regarding the sale/disposition of fixed assets, we recorded gains of $22,000 during the year ended December 31, 2024 compared to losses of $18,000 during the year ended December 31, 2023.

Non-Interest Expense

Non-interest expense increased $3.8 million, or 10.9%, to $39.1 million for the year ended December 31, 2024 from $35.2 million for the year ended December 31, 2023. The increase resulted primarily from increases of $2.1 million in salaries and employee benefits, $879,000 in other operating expense, $638,000 in real estate owned expense, $394,000 in outside data processing expense, and $233,000 in occupancy expense, partially offset by decreases of $165,000 in equipment expense, $138,000 in loss on the disposition of the Bank’s assets relating to the Harbor West Wealth Management Group, and $103,000 in advertising expense.

Income Taxes

We recorded income tax expense of $19.0 million and $18.5 million for the year ended December 31, 2024 and 2023, respectively. For the year ended December 31, 2024, we had approximately $802,000 in tax exempt income, compared to approximately $1.1 million in tax exempt income for the year ended December 31, 2023. The decrease in tax exempt income was due to two death claims totaling $1.8 million on BOLI policies during the year ended December 31, 2023. Our effective income tax rates were 28.4% and 28.5% for the year ended December 31, 2024 and 2023, respectively.

Asset Quality

Non-performing assets were $5.1 million at December 31, 2024 compared to $5.8 million at December 31, 2023. At December 31, 2023, we had two non-performing construction loans totaling $4.4 million secured by the same project located in the Bronx, New York. We successfully foreclosed on these two loans on October 21, 2024 and the balances were transferred to foreclosed real estate. As a result, at December 31, 2024, we had two non-performing assets consisting of two foreclosed properties, with one foreclosed property totaling $4.4 million located in the Bronx, New York and one foreclosed property totaling $767,000 located in Pittsburgh, Pennsylvania.

Our ratio of non-performing assets to total assets remained low at 0.25% at December 31, 2024 as compared to 0.33% at December 31, 2023.

The Company’s allowance for credit losses related to loans was $4.8 million, or 0.27% of total loans as of December 31, 2024, compared to $5.1 million, or 0.32% of total loans, as of December 31, 2023. Based on a review of the loans that were in the loan portfolio at December 31, 2024, management believes that the allowance for credit losses related to loans is maintained at a level that represents its best estimate of inherent losses in the loan portfolio that were both probable and reasonably estimable.

In addition, at December 31, 2024, the Company’s allowance for credit losses related to off-balance sheet commitments totaled $704,000 and the allowance for credit losses related to held-to-maturity debt securities totaled $126,000.

Capital

The Company’s total stockholders’ equity to assets ratio was 15.87% as of December 31, 2024. At December 31, 2024, the Company had the ability to borrow $834.7 million from the Federal Reserve Bank of New York, $18.2 million from the Federal Home Loan Bank of New York and $8.0 million from Atlantic Community Bankers Bank.

The Bank’s capital position remains strong relative to current regulatory requirements and the Bank is considered a well-capitalized institution under the Prompt Corrective Action framework. As of December 31, 2024, the Bank had a tier 1 leverage capital ratio of 14.76% and a total risk-based capital ratio of 14.04%.

The Company completed its first stock repurchase program on April 14, 2023 whereby the Company repurchased 1,637,794 shares, or 10%, of the Company’s issued and outstanding common stock. The cost of the stock repurchase program totaled $23.0 million, including commission costs and Federal excise taxes. Of the total shares repurchased under this program, 957,275 of such shares were repurchased during 2023 at a total cost of $13.7 million, including commission costs and Federal excise taxes.

The Company commenced its second stock repurchase program on May 30, 2023 whereby the Company will repurchase 1,509,218, or 10%, of the Company’s issued and outstanding common stock. As of December 31, 2024, the Company had repurchased 1,091,174 shares of common stock under its second repurchase program, at a cost of $17.2 million, including commission costs and Federal excise taxes.

About NorthEast Community Bancorp

NorthEast Community Bancorp, headquartered at 325 Hamilton Avenue, White Plains, New York 10601, is the holding company for NorthEast Community Bank, which conducts business through its eleven branch offices located in Bronx, New York, Orange, Rockland, and Sullivan Counties in New York and Essex, Middlesex, and Norfolk Counties in Massachusetts and three loan production offices located in New City, New York, White Plains, New York, and Danvers, Massachusetts. For more information about NorthEast Community Bancorp and NorthEast Community Bank, please visit www.necb.com.

Forward Looking Statement

This press release contains certain forward-looking statements. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” These statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements as a result of numerous factors. Factors that could cause actual results to differ materially from expected results include, but are not limited to, changes in market interest rates, regional and national economic conditions (including higher inflation and its impact on regional and national economic conditions), legislative and regulatory changes, monetary and fiscal policies of the United States government, including policies of the United States Treasury and the Federal Reserve Board, the quality and composition of the loan or investment portfolios, demand for loan products, decreases in deposit levels necessitating increased borrowing to fund loans and securities, competition, demand for financial services in NorthEast Community Bank’s market area, changes in the real estate market values in NorthEast Community Bank’s market area, the impact of failures or disruptions in or breaches of the Company’s operational or security systems, data or infrastructure, or those of third parties, including as a result of cyberattacks or campaigns, and changes in relevant accounting principles and guidelines. Additionally, other risks and uncertainties may be described in our annual and quarterly reports filed with the U.S. Securities and Exchange Commission (the “SEC”), which are available through the SEC’s website located at www.sec.gov. These risks and uncertainties should be considered in evaluating any forward-looking statements and undue reliance should not be placed on such statements. Except as required by applicable law or regulation, the Company does not undertake, and specifically disclaims any obligation, to release publicly the result of any revisions that may be made to any forward-looking statements to reflect events or circumstances after the date of the statements or to reflect the occurrence of anticipated or unanticipated events.


CONTACT:	Kenneth A. Martinek
	Chairman and Chief Executive Officer

PHONE:	(914) 684-2500


NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited)

	December 31,			December 31,
	2024			2023
	(In thousands, except share
	and per share amounts)
ASSETS
Cash and amounts due from depository institutions	$	13,700		$	13,394
Interest-bearing deposits		64,559			55,277
Total cash and cash equivalents		78,259			68,671
Certificates of deposit		100			100
Equity securities		21,994			18,102
Securities held-to-maturity ( net of allowance for credit losses of $126 and $136, respectively )		14,616			15,860
Loans receivable		1,813,647			1,586,721
Deferred loan (fees) costs, net		(49	)		176
Allowance for credit losses		(4,830	)		(5,093	)
Net loans		1,808,768			1,581,804
Premises and equipment, net		24,805			25,452
Investments in restricted stock, at cost		397			929
Bank owned life insurance		25,738			25,082
Accrued interest receivable		13,481			12,311
Real estate owned		5,120			1,456
Property held for investment		1,370			1,407
Right of Use Assets – Operating		4,001			4,566
Right of Use Assets – Financing		347			351
Other assets		11,302			8,044
Total assets	$	2,010,298		$	1,764,135
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Deposits:
Non-interest bearing	$	287,135		$	300,184
Interest bearing		1,383,240			1,099,852
Total deposits		1,670,375			1,400,036
Advance payments by borrowers for taxes and insurance		1,618			2,020
Borrowings		–			64,000
Lease Liability – Operating		4,108			4,625
Lease Liability – Financing		609			571
Accounts payable and accrued expenses		14,530			13,558
Total liabilities		1,691,240			1,484,810

Stockholders’ equity:
Preferred stock, $0.01 par value; 25,000,000 shares authorized; none issued or outstanding	$	—		$	—
Common stock, $0.01 par value; 75,000,000 shares authorized; 14,016,254 shares and 14,144,856 shares outstanding, respectively		140			142
Additional paid-in capital		110,091			109,924
Unearned Employee Stock Ownership Plan (“ESOP”) shares		(6,088	)		(6,563	)
Retained earnings		214,691			175,505
Accumulated other comprehensive income		224			317
Total stockholders’ equity		319,058			279,325
Total liabilities and stockholders’ equity	$	2,010,298		$	1,764,135

NORTHEAST COMMUNITY BANCORP, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited)


	Quarter Ended December 31,						Year Ended December 31,
	2024			2023			2024			2023
							(In thousands, except per share amounts)
INTEREST INCOME:
Loans	$	39,081		$	35,660		$	153,902		$	127,486
Interest-earning deposits		1,144			1,257			5,202			4,143
Securities		247			209			909			859
Total Interest Income		40,472			37,126			160,013			132,488
INTEREST EXPENSE:
Deposits		15,160			11,131			55,619			34,181
Borrowings		5			779			1,564			1,078
Financing lease		9			10			38			38
Total Interest Expense		15,174			11,920			57,221			35,297
Net Interest Income		25,298			25,206			102,792			97,191
Provision for (reversal of) credit loss		26			205			(260	)		972
Net Interest Income after Provision for (Reversal of) Credit Loss		25,272			25,001			103,052			96,219
NON-INTEREST INCOME:
Other loan fees and service charges		485			474			2,098			1,891
Gain (loss) on disposition of equipment		22			(18	)		22			(18	)
Earnings on bank owned life insurance		170			156			656			1,013
Investment advisory fees		–			115			–			458
Realized and unrealized (loss) gain on equity securities		(554	)		621			(109	)		294
Other		26			38			116			105
Total Non-Interest Income		149			1,386			2,783			3,743
NON-INTEREST EXPENSES:
Salaries and employee benefits		5,204			4,760			20,942			18,839
Occupancy expense		712			705			2,828			2,595
Equipment		229			211			890			1,055
Outside data processing		680			572			2,604			2,210
Advertising		108			101			418			521
Loss on disposition of business		–			138			–			138
Real estate owned expense		204			41			731			93
Other		2,785			2,706			10,649			9,770
Total Non-Interest Expenses		9,922			9,234			39,062			35,221
INCOME BEFORE PROVISION FOR INCOME TAXES		15,499			17,153			66,773			64,741
PROVISION FOR INCOME TAXES		4,566			5,052			18,982			18,465
NET INCOME	$	10,933		$	12,101		$	47,791		$	46,276

NORTHEAST COMMUNITY BANCORP, INC. SELECTED CONSOLIDATED FINANCIAL DATA (Unaudited)

	Quarter Ended December 31,						Year Ended December 31,
	2024			2023			2024			2023
	(In thousands, except per share amounts)						(In thousands, except per share amounts)
Per share data:
Earnings per share – basic	$	0.83		$	0.82		$	3.64		$	3.32
Earnings per share – diluted		0.80			0.82			3.58			3.32
Weighted average shares outstanding – basic		13,132			14,720			13,136			13,930
Weighted average shares outstanding – diluted		13,582			14,778			13,359			13,936
Performance ratios/data:
Return on average total assets		2.19	%		2.77	%		2.50	%		2.90	%
Return on average shareholders’ equity		13.80	%		17.49	%		15.83	%		17.09	%
Net interest income	$	25,298		$	25,206		$	102,792		$	97,191
Net interest margin		5.29	%		6.06	%		5.62	%		6.41	%
Efficiency ratio		38.99	%		34.72	%		37.00	%		34.90	%
Net charge-off ratio		0.05	%		0.01	%		0.02	%		0.02	%

Loan portfolio composition:							December 31, 2024			December 31, 2023
One-to-four family							$	3,472		$	5,252
Multi-family								206,606			198,927
Mixed-use								26,571			29,643
Total residential real estate								236,649			233,822
Non-residential real estate								29,446			21,130
Construction								1,426,167			1,219,413
Commercial and industrial								119,736			111,116
Consumer								1,649			1,240
Gross loans								1,813,647			1,586,721
Deferred loan (fees) costs, net								(49	)		176
Total loans							$	1,813,598		$	1,586,897
Asset quality data:
Loans past due over 90 days and still accruing							$	–		$	–
Non-accrual loans								–			4,385
OREO property								5,120			1,456
Total non-performing assets							$	5,120		$	5,841

Allowance for credit losses to total loans								0.27	%		0.32	%
Allowance for credit losses to non-performing loans								0.00	%		116.15	%
Non-performing loans to total loans								0.00	%		0.28	%
Non-performing assets to total assets								0.25	%		0.33	%

Bank’s Regulatory Capital ratios:
Total capital to risk-weighted assets								13.92	%		13.43	%
Common equity tier 1 capital to risk-weighted assets								13.65	%		13.10	%
Tier 1 capital to risk-weighted assets								13.65	%		13.10	%
Tier 1 leverage ratio								14.44	%		14.43	%

NORTHEAST COMMUNITY BANCORP, INC. NET INTEREST MARGIN ANALYSIS (Unaudited)

	Quarter Ended December 31, 2024								Quarter Ended December 31, 2023
	Average			Interest		Average			Average			Interest		Average
	Balance			and dividend		Yield			Balance			and dividend		Yield
	(In thousands, except yield/cost information)								(In thousands, except yield/cost information)
Loan receivable gross	$	1,784,920		$	39,081		8.76	%	$	1,545,446		$	35,660		9.23	%
Securities		36,817			232		2.52	%		33,124			188		2.27	%
Federal Home Loan Bank stock		455			15		13.19	%		929			21		9.04	%
Other interest-earning assets		90,279			1,144		5.07	%		83,436			1,257		6.03	%
Total interest-earning assets		1,912,471			40,472		8.46	%		1,662,935			37,126		8.93	%
Allowance for credit losses		(4,833	)							(4,771	)
Non-interest-earning assets		92,422								87,557
Total assets	$	2,000,060							$	1,745,721

Interest-bearing demand deposit	$	233,112		$	2,198		3.77	%	$	118,691		$	1,026		3.46	%
Savings and club accounts		137,295			767		2.23	%		206,120			1,404		2.72	%
Certificates of deposit		1,026,433			12,195		4.75	%		758,928			8,701		4.59	%
Total interest-bearing deposits		1,396,840			15,160		4.34	%		1,083,739			11,131		4.11	%
Borrowed money		1,293			14		4.33	%		67,049			789		4.71	%
Total interest-bearing liabilities		1,398,133			15,174		4.34	%		1,150,788			11,920		4.14	%
Non-interest-bearing demand deposit		263,711								298,739
Other non-interest-bearing liabilities		21,428								19,449
Total liabilities		1,683,272								1,468,976
Equity		316,788								276,745
Total liabilities and equity	$	2,000,060							$	1,745,721

Net interest income / interest spread				$	25,298		4.12	%				$	25,206		4.79	%
Net interest rate margin							5.29	%							6.06	%
Net interest earning assets	$	514,338							$	512,147
Average interest-earning assets to interest-bearing liabilities		136.79	%							144.50	%


NORTHEAST COMMUNITY BANCORP, INC. NET INTEREST MARGIN ANALYSIS (Unaudited)

	Year Ended December 31, 2024								Year Ended December 31, 2023
	Average			Interest		Average			Average			Interest		Average
	Balance			and dividend		Yield			Balance			and dividend		Yield
	(In thousands, except yield/cost information)								(In thousands, except yield/cost information)
Loan receivable gross	$	1,701,079		$	153,902		9.05	%	$	1,401,492		$	127,486		9.10	%
Securities		34,765			839		2.41	%		37,819			777		2.05	%
Federal Home Loan Bank stock		677			70		10.34	%		984			82		8.33	%
Other interest-earning assets		92,610			5,202		5.62	%		76,542			4,143		5.41	%
Total interest-earning assets		1,829,131			160,013		8.75	%		1,516,837			132,488		8.73	%
Allowance for credit losses		(4,940	)							(4,676	)
Non-interest-earning assets		90,675								84,287
Total assets	$	1,914,866							$	1,596,448

Interest-bearing demand deposit	$	209,993		$	8,498		4.05	%	$	93,426		$	2,459		2.63	%
Savings and club accounts		154,430			3,799		2.46	%		248,755			6,777		2.72	%
Certificates of deposit		917,665			43,322		4.72	%		615,124			24,945		4.06	%
Total interest-bearing deposits		1,282,088			55,619		4.34	%		957,305			34,181		3.57	%
Borrowed money		33,117			1,602		4.84	%		29,007			1,116		3.85	%
Total interest-bearing liabilities		1,315,205			57,221		4.35	%		986,312			35,297		3.58	%
Non-interest-bearing demand deposit		277,957								322,185
Other non-interest-bearing liabilities		19,739								17,139
Total liabilities		1,612,901								1,325,636
Equity		301,965								270,812
Total liabilities and equity	$	1,914,866							$	1,596,448

Net interest income / interest spread				$	102,792		4.40	%				$	97,191		5.15	%
Net interest rate margin							5.62	%							6.41	%
Net interest earning assets	$	513,926							$	530,525
Average interest-earning assets to interest-bearing liabilities		139.08	%							153.79	%

The MIL Network –

January 30, 2025

MIL-OSI USA: Cassidy, Scott Lead Colleagues in Reintroducing Bill to Expand School Choice, Educational Opportunity

US Senate News:

Source: United States Senator for Louisiana Bill Cassidy

WASHINGTON – U.S. Senators Bill Cassidy, M.D. (R-LA) and Tim Scott (R-SC) led 24 Republican colleagues in introducing the Educational Choice for Children Act (ECCA), bicameral legislation to expand education freedom and opportunity for students. Specifically, it provides a charitable donation incentive for individuals and businesses to fund scholarship awards for students to cover expenses related to K-12 public and private education. U.S. Representative Adrian Smith (R-NE-03) introduced the companion legislation in the U.S House of Representatives.
“Parents want to see their child succeed. Giving them the ability to make decisions over their child’s education puts that child’s needs first,” said Dr. Cassidy. “More freedom empowers parents and allows American children to thrive in school.”
“When you give parents a choice, you give kids a better chance at achieving their dreams,” said Senator Scott. “By empowering families with more education resources and freedom, this bill will unlock opportunities that have been out of reach for students across America who deserve every chance to succeed and a schooling system that fosters their potential.”
“Giving students a brighter future, no matter their background or address, is critical to move American K-12 education forward,” said Representative Smith. “We must empower parents with more options, acknowledging they have the final say in what educational setting is best for their children. ECCA will benefit public, private, and homeschool students and increase the quality of education in our country. I thank Rep. Owens and Sen. Cassidy for championing this legislation alongside me.”
The Educational Choice for Children Act:

Provides $10 billion in annual tax credits to be made available to taxpayers. Allotment of these credits to individuals would be administered by the Treasury Department.
Sets a base amount for each state and then distributes the credits on a first-come, first-serve basis.
Uses a limited government approach with respect to federalism, thus avoiding mandates on states, localities, and school districts.
Includes provisions that govern Scholarship Granting Organizations (SGOs), as SGOs are given the ability to determine the individual amount of scholarship awards.

An estimated two million students in any elementary or secondary education setting, including homeschool, are eligible to receive a scholarship. Eligible use of scholarships awards includes tuition, fees, book supplies, and equipment for the enrollment or attendance at an elementary or secondary school.
Cassidy and Scott was joined by U.S. Senators Cynthia Lummis (R-WY), Steve Daines (R-MT), John Cornyn (R-TX), John Thune (R-SD), Cindy Hyde-Smith (R-MS), Eric Schmitt (R-MO), Tim Sheehy (R-MT), Ted Budd (R-NC), Tom Cotton (R-AR), John Kennedy (R-LA), Tommy Tuberville (R-AL), Jim Justice (R-WV), Jim Risch (R-ID), John Barrasso (R-WY), Thom Tillis (R-NC), Roger Marshall (R-KS), Todd Young (R-IN), Josh Hawley (R-MO), Katie Britt (R-AL), Pete Ricketts (R-NE), Marsha Blackburn (R-TN), Dave McCormick (R-PA), Kevin Cramer (R-ND), and Roger Wicker (R-MS) in introducing the bill.
The Educational Choice for Children Act has received the endorsement from former U.S. Secretary of Education Betsy DeVos; former U.S. Deputy Secretary of Education Dr. Mick Zais; former U.S. Attorney General Bill Barr; Louisiana State Superintendent of Education Dr. Cade Brumley; LA Kids Matter; Louisiana Family Forum; Louisiana State University Board of Supervisors; ACE Scholarships Louisiana Founder Eddie Rispone; ACE Scholarships; Invest in Education Coalition; ACSI Children’s Education Fund; America First Policy Institute; American Association of Christian Schools; American Federation for Children (AFC); American Principles Project; Americans for Tax Reform; Association of Christian Schools International (ACSI); Black Mothers Forum; U.S. Conference of Catholic Bishops (USCCB); Catholic Education Partners; CatholicVote; Center for Education Reform; Children’s Scholarship Fund; Club for Growth; Coalition for Jewish Values; Agudath Israel of America; Orthodox Union Advocacy; Republican Jewish Coalition; Concerned Women for America; Council for American Private Education (CAPE); Defense of Freedom Institute (DFI); Family Policy Alliance; Foundation for Excellence in Education (ExcelinEd); Freedom Foundation; Heartland Institute; Heritage Action for America; Home School Legal Defense Association (HSLDA); Independent Women’s Forum; Mountain States Policy Center; Parental Rights Foundation; Parents Defending Education Action; Partners in Mission; Project 21; Protect the First; 60Plus Association; Former Virginia & Florida Secretary of Education Gerard Robinson; several other conservative leaders; and more than 150 national and state groups.
“School choice empowers parents, regardless of their zip code, to choose the education that best fits their child’s need,” said Anthony de Nicola, Chairman of Invest in Education Coalition. “I applaud Senator Cassidy for reintroducing the Educational Choice for Children Act in the Senate. Now is our time to pass this critical legislation that would help millions of students access an education of their choosing so they can achieve their God-given potential.”

MIL OSI USA News –

January 30, 2025

MIL-OSI Security: Two More Defendants Sentenced to Prison for Roles in Puerto Rico-to- Western Pennsylvania Cocaine Trafficking Operation

Source: Office of United States Attorneys

PITTSBURGH, Pa. – A resident of New Castle, Pennsylvania, and a resident of Florida, Puerto Rico, were sentenced in federal court for their convictions of conspiracy to distribute and possess with intent to distribute cocaine and related charges, Acting United States Attorney Troy Rivetti announced today. The defendants were among 17 individuals from Lawrence County, Pennsylvania; Puerto Rico; and Youngstown, Ohio, indicted in March 2024 for violating federal narcotics, firearms, and racketeering laws by conspiring to distribute cocaine throughout Western Pennsylvania and Youngstown (read the Indictment news release here).

Senior United States District Judge Arthur J. Schwab imposed the sentences on Jean Sanchez Tulla, 38, of Puerto Rico, and Glenn Samuels, 33, of New Castle, sentencing Tulla to nine years of imprisonment, to be followed by five years of supervised release, for conspiring to distribute and possess with intent to distribute 500 grams or more of cocaine and interstate travel or transmission in aid of racketeering, and Samuels to 37 months of prison, to be followed by four years of supervised release, for conspiracy to distribute and possess with intent to distribute a quantity of cocaine.

According to information presented to the Court, Tulla was a leading member of the organized drug trafficking group that shipped kilogram quantities of cocaine from Puerto Rico, often mailing drug parcels through the U.S. Postal Service to co-conspirators responsible for selling the cocaine in Western Pennsylvania; Youngstown, Ohio; and elsewhere. Specifically, Tulla was responsible for possessing with intent to distribute and distributing between five and 15 kilograms of cocaine on behalf of and during the course of the conspiracy. He also traveled from Puerto Rico to Pennsylvania—including at least 15 trips to Pittsburgh from 2023 to 2024—and elsewhere to facilitate and promote the drug trafficking enterprise, including to receive drug proceeds from other members of the organization.

Upon receipt of the shipped cocaine, leaders of the drug trafficking organization in Western Pennsylvania would distribute smaller quantities of the drugs to multiple co-conspirators, including Samuels, in order to maximize profits. Those co-conspirators then distributed the cocaine in New Castle, Ellwood City, and elsewhere in Lawrence County. At least 100 grams of cocaine was attributable to Samuels, who was found during the investigation to frequent the New Castle residence of the drug trafficking organization’s local leader for short durations, often multiple times a day.

Assistant United States Attorney Carl J. Spindler prosecuted this case on behalf of the government.

Acting United States Attorney Rivetti commended the Drug Enforcement Administration, Lawrence County High Intensity Drug Trafficking Area (HIDTA) Drug Task Force, and United States Postal Inspection Service, as well as the New Castle Police Department, Ellwood City Police Department, Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation, Pennsylvania Office of Attorney General, Pennsylvania State Police, Pittsburgh Bureau of Police, and United States Department of Agriculture for the investigation leading to the successful prosecution of Tulla and Samuels.

Lawrence County is one of six Western Pennsylvania counties officially designated as a High Intensity Drug Trafficking Area by the White House’s Office of National Drug Control Policy. The county received its HIDTA designation in July 2022, allowing it to receive dedicated federal resources to coordinate federal, state, and local governments in fighting drug trafficking and abuse.

This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.

MIL Security OSI –

January 30, 2025

MIL-OSI Asia-Pac: CBIC destroys 10,413 kg seized narcotics and 94.62 lakh tablets worth Rs. 2,246 during Drug Disposal Drivefrom 11th to 26th January, 2025

Source: Government of India (2)

Posted On: 29 JAN 2025 6:53PM by PIB Delhi

As part of Drug Disposal Driveby the Central Board of Indirect Taxes and Customs (CBIC), Ministry of Finance, from 11^th to 26^th, January, 2025, the field formations of CBIC destroyed around 7,844 kgganja, 1,724 kg methaqualone (mandrax), 560 kghashish/charas, 130 kg methamphetamine, 105 kgketamine, 23 kgheroin, 20 kg cocaine, 7 kg MDMA, 94.16 lakh tramadol HCL tablets, 46,000 alprazolam tablets and 586 ampules of injections of various drugs.

The illicit international market value of destroyed NDPS is around Rs. 2246 crores. The destruction was carried out in a safe and non-hazardous manner at multiple locations across India.

The Drug Disposal Drive not only underscores CBIC’s commitment towards combating NDPS trafficking but also aims to promote awareness among public of the initiatives being taken by CBIC in this regard. The drive coincides with the nationwide drive launched by Union Home Minister during regional conference on Drug Trafficking and National Security held on 11th January 2025 at New Delhi.

****

NB/KMN

(Release ID: 2097413) Visitor Counter : 65

MIL OSI Asia Pacific News –

January 30, 2025

MIL-OSI Asia-Pac: National Conference on Good Governance Commences Tomorrow in Gandhinagar

Source: Government of India

National Conference on Good Governance Commences Tomorrow in Gandhinagar

Chief Minister Shri Bhupendra Patel and Union Minister of State Dr. Jitendra Singh to Inaugurate the Two-Day Event

Emerging Technologies to Enhance Service Delivery Strategies to be discussed

Two exclusive sessions focused on Gujarat’s best governance practices

Posted On: 29 JAN 2025 6:42PM by PIB Delhi

The National Conference on Good Governance, organized by the Department of Administrative Reforms and Public Grievances (DARPG) in collaboration with the Government of Gujarat, begins 30.01.25 in Gandhinagar. Hon’ble Chief Minister of Gujarat Shri Bhupendra Patel and Hon’ble Union Minister Dr. Jitendra Singh will inaugurate the two-day event, delivering keynote addresses during the inaugural session.

The conference includes six focused sessions exploring innovative governance practices and emerging technologies aimed at strengthening public service delivery. The sessions will provide a platform for 30 distinguished speakers, including senior officials, district collectors, and award-winning practitioners, to share insights and case studies. Two sessions are exclusively dedicated to Gujarat’s pioneering e-Governance initiatives.

The inaugural session will also feature addresses by Shri Raj Kumar, Chief Secretary, Government of Gujarat, and Shri V. Srinivas, Secretary, DARPG.

The conference will feature the launch of the e-Journal MGMG, which highlights shortlisted initiatives for the prestigious National e-Governance Awards 2024, and the unveiling of the SCI portal.

The first session on “Government Process Re-engineering for Digital Transformation/ Emerging Technologies for providing Citizen Centric Services” of the National Conference, will be chaired by Dr. S.N. Tripathi, Director General, Indian Institute of Public Administration

It will be followed by a brief presentation on Prime Minister Awards, 2024 and National Conference on e-Governance by Additional Secretary, DARPG Shri Puneet Yadavand Joint Secretary, DARPG Smt Sarita Chauhan respectively.

Session II on the topic, “District Level Initiative in e-Governance”will hold deliberations on Best Practices. Smt. Sarita Chauhan will chair the Session.Session III on the topic, “Best Practices of Government of Gujarat” will be chaired by Shri Mona Khandhar, PS (DST).

On Day 2 of the National Conference, Ms Jayanti S Ravi, ACS (Revenue) will chair the session – IV on the topic, Emerging Technologies in Digital Transformation for Citizen”.. In session V, Sh M.K. Das, ACS (Home) will chair the discussion on “Government Process Re-engineering for Digital Transformation (Central level Initiative)”. Sh Mukesh Kumar, ACS (Education) will chair the last session before the valedictory session on the topic, Best Practices of Govt. of Gujarat (II).

The conference will also feature presentations by representatives of the best practices, highlighting transformational changes achieved under select government schemes.

The main objective of the Conference is to bring together national and state-level public administration organizations to exchange experiences and innovations in public administration. It seeks to foster discussions on e-Governance, digital transformation, and good governance practices, ensuring broader dissemination and potential replication of successful initiatives. State representatives, including DMs and DCs, will present case studies showcasing their achievements in governance.

*******

NKR/PSM

(Release ID: 2097409) Visitor Counter : 35

MIL OSI Asia Pacific News –

January 30, 2025

MIL-OSI Europe: Written question – Cybersecurity scandal in the Spanish Tax Agency – E-000250/2025

Source: European Parliament

Question for written answer E-000250/2025
to the Commission
Rule 144
Nora Junco García (ECR), Diego Solier (ECR)

We are extremely concerned about the alarming cybersecurity situation in Spain, specifically in relation to the recent announcement of an alleged theft of data from the Spanish Tax Agency. According to numerous reports and cybersecurity companies, a group of hackers, using advanced technology called ‘Trinity’, claims to be in possession of more than 560 GB of sensitive information on Spanish taxpayers.

While the Spanish government has denied evidence of the attack, the country’s own cybersecurity experts are seriously investigating the threat. This incident, together with previous episodes such as the attack on the Spanish Directorate-General for Traffic, is evidence of an alarming lack of preventive measures and inadequate management in the protection of citizens’ sensitive data.

The seriousness of this case not only puts citizens’ privacy at risk, but also exposes systemic negligence in the Spanish public administration.

In light of the above, can the Commission answer the following:

1.Does the Commission consider that Member States’ state cybersecurity systems should be more strictly assessed by EU bodies to avoid cross-border risks?
2.What action does the Commission intend to take to ensure that personal data across the EU is protected against national negligence?

Submitted: 21.1.2025

Last updated: 29 January 2025

MIL OSI Europe News –

January 30, 2025

MIL-OSI: Penns Woods Bancorp, Inc. Reports Fourth Quarter 2024 Earnings

Source: GlobeNewswire (MIL-OSI)

WILLIAMSPORT, Pa., Jan. 29, 2025 (GLOBE NEWSWIRE) — Penns Woods Bancorp, Inc. (NASDAQ: PWOD)

Penns Woods Bancorp, Inc. achieved net income of $17.7 million for the twelve months ended December 31, 2024, resulting in basic and diluted earnings per share of $2.35.

Highlights

Net income, as reported under generally accepted accounting principles (GAAP), for the three and twelve months ended December 31, 2024 was $3.7 million and $17.7 million, respectively, compared to $5.6 million and $16.6 million for the same periods of 2023. Results for the three and twelve months ended December 31, 2024 compared to 2023 were impacted by an increase in net interest income of $1.6 million and $3.9 million, respectively, as the cost of funds stabilized. The three and twelve month periods ended December 31, 2024 have been impacted by after-tax merger related expenses of $581,000 resulting from the announced acquisition of the company by Northwest Bancshares, Inc. The disposal of assets related to two former branch properties resulted in a one time after-tax loss of $261,000 for the twelve month period ended December 31, 2024.
The allowance for credit losses was impacted for the three and twelve months ended December 31, 2024 by a provision for credit losses of $420,000 and $121,000, respectively, compared to a negative provision for credit losses of $1.7 million and $1.5 million for the 2023 periods. The recognition of a negative provision for credit losses for the 2023 periods was due primarily to a recovery on a commercial loan which positively affected the historical loss rates, and the payoff of a nonperforming commercial loan.
Basic and diluted earnings per share for the three months ended December 31, 2024 were $0.50 and $0.49, respectively, while the twelve months ended December 31, 2024 basic and diluted was $2.35. This compares to basic and diluted earnings per share of $0.77 and $2.34, respectively, for the three and twelve month periods ended December 31, 2023.
Annualized return on average assets was 0.67% for the three months ended December 31, 2024, compared to 1.02% for the corresponding period of 2023. Return on average assets was 0.80% for the twelve months ended December 31, 2024, compared to 0.79% for the corresponding period of 2023.
Annualized return on average equity was 7.28% for the three months ended December 31, 2024, compared to 12.60% for the corresponding period of 2023. Return on average equity was 9.14% for the twelve months ended December 31, 2024, compared to 9.84% for the corresponding period of 2023.

Net Income

Net income from core operations (“core earnings”), which is a non-GAAP measure of net income excluding net securities gains or losses, was $4.4 million and $18.4 million, respectively, for the three and twelve months ended December 31, 2024 compared to $5.6 million and $16.7 million for the same periods of 2023. Core earnings per share (non-GAAP) for the three months ended December 31, 2024 were basic $0.58 and diluted $0.57 while basic and diluted for the twelve months ended December 31, 2024 were $2.44. Basic and diluted core earnings per share for the three and twelve month periods of 2023 were $0.77 and $2.36, respectively. Annualized core return on average assets and core return on average equity (non-GAAP) were 0.78% and 8.48%, respectively, for the three months ended December 31, 2024, compared to 1.02% and 12.63% for the corresponding period of 2023. Annualized core return on average assets and core return on average equity (non-GAAP) were 0.83% and 9.46%, respectively, for the twelve months ended December 31, 2024, compared to 0.79% and 9.93% for the corresponding period of 2023. A reconciliation of the non-GAAP financial measures of core earnings, core return on assets, core return on equity, core earnings per share and tangible book value per share to the comparable GAAP financial measures is included at the end of this press release.

Net Interest Margin

The net interest margin for the three and twelve months ended December 31, 2024 was 2.98% and 2.83% respectively, compared to 2.73% and 2.80% for the corresponding periods of 2023. The increase in the net interest margin for the three month period was driven by an increase in the rate collected on interest-earning assets of 34 basis points (“bps”), while the decrease in the net interest margin for the twelve month period was driven by a 74 bps increase in the rate paid on interest-bearing liabilities. The overall increase in interest rates over the periods resulted in increases to both the yield on the earnings asset portfolio and the rate paid on interest-bearing liabilities. Driving the increase in the yield and interest income on the earning assets portfolio was the repricing of legacy assets coupled with portfolio growth. The average loan portfolio balance increased $47.4 million and $106.9 million, respectively, for the three and twelve month periods ended December 31, 2024 compared to the same periods of 2023 as the average yield on the portfolio increased 31 bps and 61 bps, resulting in an increase in taxable equivalent interest income of $2.0 million and $16.5 million, for the periods. The three and twelve month periods ended December 31, 2024 were impacted by an increase of 57 bps and 66 bps in the yield earned on the securities portfolio as legacy securities matured with the funds reinvested at higher rates, which resulted in an increase in taxable equivalent interest income of $285,000 and $1.5 million, respectively. Short-term borrowings decreased leading to a decrease of $1.8 million and $3.9 million, respectively, in expense for the three and twelve month periods ended December 31, 2024 compared to the same periods of 2023. The rate paid on interest-bearing deposits increased 37 bps and 96 bps, respectively, or $2.1 million and $13.8 million in expense, for the three and twelve month periods ended December 31, 2024 compared to the corresponding periods of 2023 due to the rate environment, an increase in competition for deposits, and a migration of deposit balances from core deposits to higher rate time deposits. The rates paid on time deposits significantly contributed to the increase in funding costs as rates paid for the three and twelve month periods ended December 31, 2024 compared to the same periods of 2023 increased 29 bps and 87 bps, respectively, or $1.7 million and $9.9 million in expense, as deposit gathering campaigns continued to focus on time deposits with a maturity of five to twenty-four months. In addition, brokered deposits have been utilized to assist with funding the loan portfolio growth and contributed to the increase in time deposit funding costs, while lowering the reliance on higher cost short-term borrowings.

Assets

Total assets increased to $2.2 billion at December 31, 2024, an increase of $27.5 million compared to December 31, 2023. Net loans increased $36.9 million to $1.9 billion at December 31, 2024 compared to December 31, 2023, as continued emphasis was placed on commercial loan growth and indirect auto lending. The investment portfolio decreased $10.7 million from December 31, 2023 to December 31, 2024.

Non-performing Loans

The ratio of non-performing loans to total loans ratio increased to 0.47% at December 31, 2024 from 0.17% at December 31, 2023, as non-performing loans increased to $8.9 million at December 31, 2024 from $3.1 million at December 31, 2023. The majority of non-performing loans involve loans that are either in a secured position and have sureties with a strong underlying financial position or have been classified as individually evaluated loans that have a specific allocation recorded within the allowance for credit losses. Net loan charge offs of $228,000 and $540,000 for the three and twelve months ended December 31, 2024, respectively, impacted the allowance for credit losses, which was 0.63% of total loans at December 31, 2024 compared to 0.62% at December 31, 2023. Exposure to non-owner occupied office space is minimal at $14.1 million at December 31, 2024 with none of these loans being delinquent.

Deposits

Deposits increased $116.6 million to $1.7 billion at December 31, 2024 compared to December 31, 2023. Noninterest-bearing deposits decreased $14.2 million to $456.9 million at December 31, 2024 compared to December 31, 2023. Core deposits declined $17.8 million as deposits migrated from core deposit accounts into time deposits as market rates and competition for deposits increased. Core deposit gathering efforts remained focused on increasing the utilization of electronic (internet and mobile) deposit banking by our customers. Core deposits have remained stable at $1.2 billion over the past five quarters. Interest-bearing deposits increased $130.8 million from December 31, 2023 to December 31, 2024 due to growth in the time deposit portfolio of $80.8 million as customers sought a higher rate of interest. Brokered deposit balances increased $53.6 million to $178.3 million at December 31, 2024 as this funding source was utilized to supplement funding loan portfolio growth, while reducing the need to draw upon available borrowing lines. A campaign to attract time deposits with a maturity of five to twenty-four months commenced during the latter part of 2022 and has continued throughout 2023 and 2024 with current efforts centered on five months.

Shareholders’ Equity

Shareholders’ equity increased $13.7 million to $205.2 million at December 31, 2024 compared to December 31, 2023. During the three and twelve months ended December 31, 2024 there were no shares issued under the previously disclosed registered at-the-market offering. A total 31,066 shares for net proceeds of $632,000 were issued as part of the Dividend Reinvestment Plan during the twelve months ended December 31, 2024. Accumulated other comprehensive loss of $5.3 million at December 31, 2024 decreased from a loss of $9.2 million at December 31, 2023 as a result of a decrease in net unrealized loss on available for sale securities to $4.6 million at December 31, 2024 from a net unrealized loss of $6.4 million at December 31, 2023, coupled with a decrease in loss of $2.0 million in the defined benefit plan obligation. The current level of shareholders’ equity equates to a book value per share of $27.16 at December 31, 2024 compared to $25.51 at December 31, 2023, and an equity to asset ratio of 9.19% at December 31, 2024 and 8.69% at December 31, 2023. Tangible book value per share (a non-GAAP measure) increased to $24.97 at December 31, 2024 compared to $23.29 at December 31, 2023. Dividends declared for the three and twelve months ended December 31, 2024 and 2023 were $0.32 and $1.28 per share.

Penns Woods Bancorp, Inc. is the parent company of Jersey Shore State Bank, which operates sixteen branch offices providing financial services in Lycoming, Clinton, Centre, Montour, Union, and Blair Counties, and Luzerne Bank, which operates eight branch offices providing financial services in Luzerne County, and United Insurance Solutions, LLC, which offers insurance products. Investment and insurance products are offered through Jersey Shore State Bank’s subsidiary, The M Group, Inc. D/B/A The Comprehensive Financial Group.

NOTE: This press release contains financial information determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). Management uses the non-GAAP measure of net income from core operations in its analysis of the company’s performance. This measure, as used by the Company, adjusts net income determined in accordance with GAAP to exclude the effects of special items, including significant gains or losses that are unusual in nature such as net securities gains and losses. Because these certain items and their impact on the Company’s performance are difficult to predict, management believes presentation of financial measures excluding the impact of such items provides useful supplemental information in evaluating the operating results of the Company’s core businesses. These disclosures should not be viewed as a substitute for net income determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

This press release may contain certain “forward-looking statements” including statements concerning plans, objectives, future events or performance and assumptions and other statements, which are statements other than statements of historical fact. The Company cautions readers that the following important factors, among others, may have affected and could in the future affect actual results and could cause actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of the Company herein: (i) the effect of changes in laws and regulations, including federal and state banking laws and regulations, and the associated costs of compliance with such laws and regulations either currently or in the future as applicable; (ii) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies as well as by the Financial Accounting Standards Board, or of changes in the Company’s organization, compensation and benefit plans; (iii) the effect on the Company’s competitive position within its market area of the increasing consolidation within the banking and financial services industries, including the increased competition from larger regional and out-of-state banking organizations as well as non-bank providers of various financial services; (iv) the effect of changes in interest rates; (v) the effects of health emergencies, including the spread of infectious diseases or pandemics; (vi) the effect of changes in the business cycle and downturns in the local, regional or national economies; or (vii) any potential adverse events or developments resulting from the merger agreement, dated December 16, 2024, between Penns Woods Bancorp, Inc. and Northwest Bancshares, Inc., including, without limitation, any event, change, or other circumstances that could give rise to the right of one or both of the parties to terminate the merger agreement or the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the merger within the expected timeframes or to successfully integrate the business and operations of Jersey Shore State Bank and Luzerne Bank with those of Northwest Savings Bank after closing. For a list of other factors which could affect the Company’s results, see the Company’s filings with the Securities and Exchange Commission, including “Item 1A. Risk Factors,” set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

You should not place undue reliance on any forward-looking statements. These statements speak only as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company undertakes no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.

Previous press releases and additional information can be obtained from the Company’s website at www.pwod.com.

Contact:	Richard A. Grafmyre, Chief Executive Officer
	110 Reynolds Street
	Williamsport, PA 17702
	570-322-1111	e-mail: pwod@pwod.com


PENNS WOODS BANCORP, INC. CONSOLIDATED BALANCE SHEET (UNAUDITED)

	December 31,
(In Thousands, Except Share and Per Share Data)		2024			2023		% Change
ASSETS:
Noninterest-bearing cash	$	19,989		$	28,969		(31.00	)	%
Interest-bearing balances in other financial institutions		8,983			8,493		5.77		%
Total cash and cash equivalents		28,972			37,462		(22.66	)	%

Investment debt securities, available for sale, at fair value		184,542			190,945		(3.35	)	%
Investment equity securities, at fair value		1,111			1,122		(0.98	)	%
Restricted investment in bank stock		20,032			24,323		(17.64	)	%
Loans held for sale		3,266			3,993		(18.21	)	%
Loans		1,877,078			1,839,764		2.03		%
Allowance for credit losses		(11,848	)		(11,446	)	3.51		%
Loans, net		1,865,230			1,828,318		2.02		%
Premises and equipment, net		27,789			30,250		(8.14	)	%
Accrued interest receivable		11,114			11,044		0.63		%
Bank-owned life insurance		45,681			33,867		34.88		%
Investment in limited partnerships		6,691			7,815		(14.38	)	%
Goodwill		16,450			16,450		—		%
Intangibles		107			210		(49.05	)	%
Operating lease right of use asset		2,811			2,512		11.90		%
Deferred tax asset		3,493			4,655		(24.96	)	%
Other assets		15,049			11,843		27.07		%
TOTAL ASSETS	$	2,232,338		$	2,204,809		1.25		%

LIABILITIES:
Interest-bearing deposits	$	1,249,145		$	1,118,320		11.70		%
Noninterest-bearing deposits		456,936			471,173		(3.02	)	%
Total deposits		1,706,081			1,589,493		7.33		%
									%
Short-term borrowings		42,200			145,926		(71.08	)	%
Long-term borrowings		254,588			252,598		0.79		%
Accrued interest payable		4,664			3,814		22.29		%
Operating lease liability		2,889			2,570		12.41		%
Other liabilities		16,685			18,852		(11.49	)	%
TOTAL LIABILITIES		2,027,107			2,013,253		0.69		%

SHAREHOLDERS’ EQUITY:
Preferred stock, no par value, 3,000,000 shares authorized; no shares issued		—			—		n/a
Common stock, par value $5.55, 22,500,000 shares authorized; 8,066,968 and 8,019,219 shares issued; 7,556,743 and 7,508,994 shares outstanding		44,815			44,550		0.59		%
Additional paid-in capital		63,193			61,733		2.37		%
Retained earnings		115,331			107,238		7.55		%
Accumulated other comprehensive loss:
Net unrealized loss on available for sale securities		(4,567	)		(6,396	)	28.60		%
Defined benefit plan		(726	)		(2,754	)	73.64		%
Treasury stock at cost, 510,225 shares		(12,815	)		(12,815	)	—		%
TOTAL SHAREHOLDERS’ EQUITY		205,231			191,556		7.14		%
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	2,232,338		$	2,204,809		1.25		%


PENNS WOODS BANCORP, INC. CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)

	Three Months Ended December 31,										Twelve Months Ended December 31,
(In Thousands, Except Share and Per Share Data)		2024			2023		% Change					2024			2023		% Change
INTEREST AND DIVIDEND INCOME:
Loans including fees	$	25,759		$	23,720		8.60		%		$	99,780		$	83,291		19.80		%
Investment securities:
Taxable		1,826			1,476		23.71		%			7,039			5,346		31.67		%
Tax-exempt		59			107		(44.86	)	%			292			517		(43.52	)	%
Dividend and other interest income		607			614		(1.14	)	%			2,587			2,441		5.98		%
TOTAL INTEREST AND DIVIDEND INCOME		28,251			25,917		9.01		%			109,698			91,595		19.76		%

INTEREST EXPENSE:
Deposits		9,523			7,445		27.91		%			35,962			22,131		62.50		%
Short-term borrowings		479			2,317		(79.33	)	%			4,503			8,401		(46.40	)	%
Long-term borrowings		2,686			2,207		21.70		%			10,353			6,099		69.75		%
TOTAL INTEREST EXPENSE		12,688			11,969		6.01		%			50,818			36,631		38.73		%

NET INTEREST INCOME		15,563			13,948		11.58		%			58,880			54,964		7.12		%

PROVISION (RECOVERY) FOR CREDIT LOSSES		420			(1,742	)	124.11		%			121			(1,479	)	108.18		%

NET INTEREST INCOME AFTER PROVISION (RECOVERY) OF CREDIT LOSSES		15,143			15,690		(3.49	)	%			58,759			56,443		4.10		%

NON-INTEREST INCOME:
Service charges		516			533		(3.19	)	%			2,067			2,090		(1.10	)	%
Net debt securities losses, available for sale		(9	)		(68	)	86.76		%			(49	)		(193	)	74.61		%
Net equity securities (losses) gains		(35	)		50		(170.00	)	%			(11	)		15		(173.33	)	%
Bank-owned life insurance		303			171		77.19		%			1,159			1,063		9.03		%
Gain on sale of loans		463			314		47.45		%	.		1,484			1,046		41.87		%
Insurance commissions		128			113		13.27		%			553			529		4.54		%
Brokerage commissions		163			127		28.35		%			684			575		18.96		%
Loan broker income		543			264		105.68		%			1,384			992		39.52		%
Debit card income		385			333		15.62		%			1,437			1,328		8.21		%
Other		253			384		(34.11	)	%			910			930		(2.15	)	%
TOTAL NON-INTEREST INCOME		2,710			2,221		22.02		%			9,618			8,375		14.84		%

NON-INTEREST EXPENSE:
Salaries and employee benefits		7,032			6,284		11.90		%			26,256			25,062		4.76		%
Occupancy		758			746		1.61		%			3,152			3,168		(0.51	)	%
Furniture and equipment		1,233			889		38.70		%			3,669			3,392		8.17		%
Software amortization		339			250		35.60		%			996			843		18.15		%
Pennsylvania shares tax		351			275		27.64		%			1,373			1,082		26.89		%
Professional fees		523			640		(18.28	)	%			2,177			2,953		(26.28	)	%
Federal Deposit Insurance Corporation deposit insurance		385			456		(15.57	)	%			1,564			1,578		(0.89	)	%
Marketing		74			90		(17.78	)	%			283			684		(58.63	)	%
Intangible amortization		25			25		—		%			102			117		(12.82	)	%
Merger expense		735			—		n/a					735			—		n/a
Other		1,525			1,342		13.64		%			6,177			5,617		9.97		%
TOTAL NON-INTEREST EXPENSE		12,980			10,997		18.03		%			46,484			44,496		4.47		%
INCOME BEFORE INCOME TAX PROVISION		4,873			6,914		(29.52	)	%			21,893			20,322		7.73		%
INCOME TAX PROVISION		1,132			1,359		(16.70	)	%			4,154			3,714		11.85		%
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS’	$	3,741		$	5,555		(32.66	)	%		$	17,739		$	16,608		6.81		%
EARNINGS PER SHARE – BASIC	$	0.50		$	0.77		(35.06	)	%		$	2.35		$	2.34		0.43		%
EARNINGS PER SHARE – DILUTED	$	0.49		$	0.77		(36.36	)	%		$	2.35		$	2.34		0.43		%
WEIGHTED AVERAGE SHARES OUTSTANDING – BASIC		7,555,168			7,255,222		4.13		%			7,535,397			7,112,450		5.95		%
WEIGHTED AVERAGE SHARES OUTSTANDING – DILUTED		7,693,185			7,255,222		6.04		%			7,543,111			7,112,450		6.06		%


PENNS WOODS BANCORP, INC. AVERAGE BALANCES AND INTEREST RATES (UNAUDITED)

	Three Months Ended
	December 31, 2024						December 31, 2023
(Dollars in Thousands)	Average Balance (1)		Interest		Average Rate		Average Balance (1)		Interest		Average Rate
ASSETS:
Tax-exempt loans (3)	$	69,967	$	453	2.58	%	$	68,234	$	478	2.78	%
All other loans		1,806,212		25,401	5.59	%		1,760,509		23,342	5.26	%
Total loans (2)		1,876,179		25,854	5.48	%		1,828,743		23,820	5.17	%

Taxable securities		199,868		2,277	4.63	%		193,744		1,932	4.04	%
Tax-exempt securities (3)		11,317		75	2.70	%		18,041		135	3.03	%
Total securities		211,185		2,352	4.53	%		211,785		2,067	3.96	%

Interest-bearing balances in other financial institutions		13,136		156	4.72	%		11,795		158	5.31	%

Total interest-earning assets		2,100,500		28,362	5.38	%		2,052,323		26,045	5.04	%

Other assets		137,840						130,421

TOTAL ASSETS	$	2,238,340					$	2,182,744

LIABILITIES AND SHAREHOLDERS’ EQUITY:
Savings	$	209,300		266	0.51	%	$	222,740		229	0.41	%
Super Now deposits		220,792		1,070	1.93	%		227,113		1,129	1.97	%
Money market deposits		323,181		2,656	3.27	%		293,542		2,217	3.00	%
Time deposits		504,683		5,531	4.36	%		377,516		3,870	4.07	%
Total interest-bearing deposits		1,257,956		9,523	3.01	%		1,120,911		7,445	2.64	%

Short-term borrowings		38,495		479	4.96	%		163,088		2,317	5.63	%
Long-term borrowings		256,521		2,686	4.17	%		235,998		2,207	3.71	%
Total borrowings		295,016		3,165	4.27	%		399,086		4,524	4.50	%

Total interest-bearing liabilities		1,552,972		12,688	3.25	%		1,519,997		11,969	3.12	%

Demand deposits		454,612						457,546
Other liabilities		25,218						28,786
Shareholders’ equity		205,538						176,415

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	2,238,340					$	2,182,744
Interest rate spread (3)					2.13	%					1.92	%
Net interest income/margin (3)			$	15,674	2.98	%			$	14,076	2.73	%

1.	Information on this table has been calculated using average daily balance sheets to obtain average balances.
2.	Non-accrual loans have been included with loans for the purpose of analyzing net interest earnings.
3.	Income and rates on fully taxable equivalent basis include an adjustment for the difference between annual income from tax-exempt obligations and the taxable equivalent of such income at the standard tax rate of 21%.

	Three Months Ended December 31,
		2024		2023
Total interest income	$	28,251	$	25,917
Total interest expense		12,688		11,969
Net interest income (GAAP)		15,563		13,948
Tax equivalent adjustment		111		128
Net interest income (fully taxable equivalent) (non-GAAP)	$	15,674	$	14,076


PENNS WOODS BANCORP, INC. AVERAGE BALANCES AND INTEREST RATES (UNAUDITED)

	Twelve Months Ended
	December 31, 2024						December 31, 2023
(Dollars in Thousands)	Average Balance (1)		Interest		Average Rate		Average Balance (1)		Interest		Average Rate
ASSETS:
Tax-exempt loans (3)	$	69,448	$	1,943	2.80	%	$	66,863	$	1,849	2.77	%
All other loans		1,796,096		98,245	5.47	%		1,691,742		81,830	4.84	%
Total loans (2)		1,865,544		100,188	5.37	%		1,758,605		83,679	4.76	%

Taxable securities		202,934		9,072	4.47	%		189,804		7,263	3.83	%
Tax-exempt securities (3)		13,045		370	2.84	%		23,872		654	2.74	%
Total securities		215,979		9,442	4.37	%		213,676		7,917	3.71	%

Interest-bearing balances in other financial institutions		11,074		554	5.00	%		10,916		524	4.80	%

Total interest-earning assets		2,092,597		110,184	5.27	%		1,983,197		92,120	4.65	%

Other assets		132,720						131,704

TOTAL ASSETS	$	2,225,317					$	2,114,901

LIABILITIES AND SHAREHOLDERS’ EQUITY:
Savings	$	215,107		1,077	0.50	%	$	231,000		685	0.30	%
Super Now deposits		218,932		4,373	2.00	%		276,868		4,155	1.50	%
Money market deposits		311,836		10,390	3.33	%		292,755		7,024	2.40	%
Time deposits		460,869		20,122	4.37	%		293,252		10,267	3.50	%
Total interest-bearing deposits		1,206,744		35,962	2.98	%		1,093,875		22,131	2.02	%

Short-term borrowings		82,046		4,503	5.49	%		157,140		8,401	5.36	%
Long-term borrowings		256,850		10,353	4.03	%		186,094		6,099	3.28	%
Total borrowings		338,896		14,856	4.40	%		343,234		14,500	4.23	%

Total interest-bearing liabilities		1,545,640		50,818	3.29	%		1,437,109		36,631	2.55	%

Demand deposits		454,878						477,828
Other liabilities		30,680						31,243
Shareholders’ equity		194,119						168,721

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	2,225,317					$	2,114,901
Interest rate spread (3)					1.98	%					2.10	%
Net interest income/margin (3)			$	59,366	2.83	%			$	55,489	2.80	%

1.	Information on this table has been calculated using average daily balance sheets to obtain average balances.
2.	Non-accrual loans have been included with loans for the purpose of analyzing net interest earnings.
3.	Income and rates on fully taxable equivalent basis include an adjustment for the difference between annual income from tax-exempt obligations and the taxable equivalent of such income at the standard tax rate of 21%.

	Twelve months ended December 31,
		2024		2023
Total interest income	$	109,698	$	91,595
Total interest expense		50,818		36,631
Net interest income (GAAP)		58,880		54,964
Tax equivalent adjustment		486		525
Net interest income (fully taxable equivalent) (non-GAAP)	$	59,366	$	55,489

(Dollars in Thousands, Except Per Share Data, Unaudited)	Quarter Ended
	12/31/2024				9/30/2024				6/30/2024				3/31/2024				12/31/2023
Operating Data
Net income	$	3,741			$	4,801			$	5,390			$	3,808			$	5,555
Net interest income		15,563				15,056				14,515				13,746				13,948
Provision (recovery) for credit losses		420				740				(1,177	)			138				(1,742	)
Net security (losses) gains		(44	)			36				(19	)			(33	)			(18	)
Non-interest income, excluding net security (losses) gains		2,754				2,385				2,044				2,495				2,239
Non-interest expense		12,980				10,884				10,996				11,623				10,997

Performance Statistics
Net interest margin		2.98		%		2.88		%		2.83		%		2.69		%		2.73		%
Annualized cost of total deposits		2.22		%		2.27		%		2.14		%		2.01		%		1.89		%
Annualized non-interest income to average assets		0.48		%		0.43		%		0.37		%		0.45		%		0.41		%
Annualized non-interest expense to average assets		2.32		%		1.95		%		1.98		%		2.10		%		2.02		%
Annualized return on average assets		0.67		%		0.86		%		0.97		%		0.69		%		1.02		%
Annualized return on average equity		7.28		%		9.60		%		11.12		%		8.03		%		12.60		%
Annualized net loan charge-offs (recoveries) to average loans		0.05		%		0.07		%		(0.09	)	%		0.08		%		(0.05	)	%
Net charge-offs (recoveries)		228				328				(396	)			380				(209	)
Efficiency ratio		70.73		%		62.26		%		66.25		%		71.41		%		67.78		%

Per Share Data
Basic earnings per share	$	0.50			$	0.64			$	0.72			$	0.51			$	0.77
Diluted earnings per share		0.49				0.64				0.72				0.51				0.77
Dividend declared per share		0.32				0.32				0.32				0.32				0.32
Book value		27.16				26.96				26.13				25.72				25.51
Tangible book value (Non-GAAP)		24.97				24.77				23.93				23.50				23.29
Common stock price:
High		34.06				23.98				21.08				22.64				23.64
Low		23.74				19.29				17.17				18.44				20.05
Close		30.39				23.79				20.55				19.41				22.51
Weighted average common shares:
Basic		7,555				7,544				7,529				7,513				7,255
Fully Diluted		7,693				7,544				7,529				7,513				7,255
End-of-period common shares:
Issued		8,067				8,065				8,052				8,036				8,019
Treasury		(510	)			(510	)			(510	)			(510	)			(510	)

(Dollars in Thousands, Unaudited)	Quarter Ended
	12/31/2024			9/30/2024			6/30/2024			3/31/2024			12/31/2023
Financial Condition Data:
General
Total assets	$	2,232,338		$	2,259,250		$	2,234,617		$	2,210,116		$	2,204,809
Loans, net		1,865,230			1,863,586			1,855,054			1,843,805			1,828,318
Goodwill		16,450			16,450			16,450			16,450			16,450
Intangibles		107			133			158			184			210
Total deposits		1,706,081			1,700,321			1,648,093			1,618,562			1,589,493
Noninterest-bearing		456,936			452,922			461,092			471,451			471,173
Savings		208,340			211,560			218,354			220,932			219,287
NOW		212,687			218,279			209,906			208,073			214,888
Money Market		308,977			321,614			320,101			299,916			299,353
Time Deposits		340,844			328,294			310,187			292,372			260,067
Brokered Deposits		178,297			167,652			128,453			125,818			124,725
Total interest-bearing deposits		1,249,145			1,247,399			1,187,001			1,147,111			1,118,320

Core deposits*		1,186,940			1,204,375			1,209,453			1,200,372			1,204,701
Shareholders’ equity		205,231			203,694			197,087			193,517			191,556

Asset Quality
Non-performing loans	$	8,904		$	7,940		$	6,784		$	7,958		$	3,148
Non-performing loans to total assets		0.40	%		0.35	%		0.30	%		0.36	%		0.14	%
Allowance for credit losses on loans		11,848			11,588			11,234			11,542			11,446
Allowance for credit losses on loans to total loans		0.63	%		0.62	%		0.60	%		0.62	%		0.62	%
Allowance for credit losses on loans to non-performing loans		133.06	%		145.94	%		165.60	%		145.04	%		363.60	%
Non-performing loans to total loans		0.47	%		0.42	%		0.36	%		0.43	%		0.17	%

Capitalization
Shareholders’ equity to total assets		9.19	%		9.02	%		8.82	%		8.76	%		8.69	%

* Core deposits are defined as total deposits less time deposits and brokered deposits.


Reconciliation of GAAP and Non-GAAP Financial Measures (UNAUDITED)

	Three Months Ended December 31,						Twelve Months Ended December 31,
(Dollars in Thousands, Except Per Share Data, Unaudited)	2024			2023			2024			2023
GAAP net income	$	3,741		$	5,555		$	17,739		$	16,608
Net securities losses, net of tax		35			14			47			141
Merger expenses, net of tax		581			—			581			—
Non-GAAP core earnings	$	4,357		$	5,569		$	18,367		$	16,749

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2024			2023			2024			2023
Return on average assets (ROA)		0.67	%		1.02	%		0.80	%		0.79	%
Net securities losses, net of tax		0.01	%		—	%		—	%		—	%
Merger expenses, net of tax		0.10	%		—	%		0.03	%		—	%
Non-GAAP core ROA		0.78	%		1.02	%		0.83	%		0.79	%

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2024			2023			2024			2023
Return on average equity (ROE)		7.28	%		12.60	%		9.14	%		9.84	%
Net securities losses, net of tax		0.07	%		0.03	%		0.02	%		0.09	%
Merger expenses, net of tax		1.13	%		—	%		0.30	%		—	%
Non-GAAP core ROE		8.48	%		12.63	%		9.46	%		9.93	%

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2024			2023			2024			2023
Basic earnings per share (EPS)	$	0.50		$	0.77		$	2.35		$	2.34
Net securities losses, net of tax		—			—			0.01			0.02
Merger expenses, net of tax		0.08			—			0.08			—
Non-GAAP basic core EPS	$	0.58		$	0.77		$	2.44		$	2.36

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2024			2023			2024			2023
Diluted EPS	$	0.49		$	0.77		$	2.35		$	2.34
Net securities losses, net of tax		—			—			0.01			0.02
Merger expenses, net of tax		0.08			—			0.08			—
Non-GAAP diluted core EPS	$	0.57		$	0.77		$	2.44		$	2.36

(Dollars in Thousands, Except Share and Per Share Data, Unaudited)	Quarter Ended
	12/31/2024			9/30/2024			6/30/2024			3/31/2024			12/31/2023
Total shareholders’ equity	$	205,231		$	203,694		$	197,087		$	193,517		$	191,556
Goodwill		(16,450	)		(16,450	)		(16,450	)		(16,450	)		(16,450	)
Intangibles		(107	)		(133	)		(158	)		(184	)		(210	)
Tangible shareholders’ equity	$	188,674		$	187,111		$	180,479		$	176,883		$	174,896

Shares outstanding		7,556,743			7,554,488			7,541,474			7,525,372			7,508,994

Book value per share	$	27.16		$	26.96		$	26.13		$	25.72		$	25.51
Tangible book value per share (Non-GAAP)	$	24.97		$	24.77		$	23.93		$	23.50		$	23.29

The MIL Network –

January 30, 2025

MIL-OSI USA: Scott, Cassidy, Lead Colleagues in Reintroducing Bill to Expand School Choice, Educational Opportunity

US Senate News:

Source: United States Senator for South Carolina Tim Scott
WASHINGTON — U.S. Senators Tim Scott (R-S.C.), co-chair of the Congressional School Choice Caucus and member of the Senate Health, Education, Labor and Pensions (HELP) Committee, and Bill Cassidy, M.D. (R-La.), chair of the Senate HELP Committee, led 16 Republican colleagues in introducing the Educational Choice for Children Act (ECCA), bicameral legislation to expand education freedom and opportunity for students. Specifically, it provides a charitable donation incentive for individuals and businesses to fund scholarship awards for students to cover expenses related to K-12 public and private education.
“When you give parents a choice, you give kids a better chance at achieving their dreams,” said Senator Scott. “By empowering families with more education resources and freedom, this bill will unlock opportunities that have been out of reach for students across America who deserve every chance to succeed and a schooling system that fosters their potential.”
“Parents want to see their child succeed. Giving them the ability to make decisions over their child’s education puts that child’s needs first,” said Dr. Cassidy. “More freedom empowers parents and allows American children to thrive in school.”
The Educational Choice for Children Act:
Provides $10 billion in annual tax credits to be made available to taxpayers. Allotment of these credits to individuals would be administered by the Treasury Department.
Sets a base amount for each state and then distributes the credits on a first-come, first-serve basis.
Uses a limited government approach with respect to federalism, thus avoiding mandates on states, localities, and school districts.
Includes provisions that govern Scholarship Granting Organizations (SGOs), as SGOs are given the ability to determine the individual amount of scholarship awards.
An estimated two million students in any elementary or secondary education setting, including homeschool, are eligible to receive a scholarship. Eligible use of scholarships awards includes tuition, fees, book supplies, and equipment for the enrollment or attendance at an elementary or secondary school.
Senators Scott and Cassidy were joined by U.S. Senators Cynthia Lummis (R-Wyo.), Steve Daines (R-Mont.), John Cornyn (R-Texas), John Thune (R-S.D.), Cindy Hyde-Smith (R-Miss.), Eric Schmitt (R-Mo.), Tim Sheehy (R-Mont.), Ted Budd (R-N.C.), John Kennedy (R-La.), Tommy Tuberville (R-Ala.), Jim Justice (R-W.Va.), Jim Risch (R-Idaho), John Barrasso (R-Wyo.), Thom Tillis (R-N.C.), Roger Marshall (R-Kan.), and Todd Young (R-Ind.) in introducing the bill.
The Educational Choice for Children Act has received the endorsement from former U.S. Secretary of Education Betsy DeVos; former U.S. Deputy Secretary of Education Dr. Mick Zais; former U.S. Attorney General Bill Barr; Louisiana State Superintendent of Education Dr. Cade Brumley; LA Kids Matter; Louisiana Family Forum; Louisiana State University Board of Supervisors; ACE Scholarships Louisiana Founder Eddie Rispone; ACE Scholarships; Invest in Education Coalition; ACSI Children’s Education Fund; America First Policy Institute; American Association of Christian Schools; American Federation for Children (AFC); American Principles Project; Americans for Tax Reform; Association of Christian Schools International (ACSI); Black Mothers Forum; U.S. Conference of Catholic Bishops (USCCB); Catholic Education Partners; CatholicVote; Center for Education Reform; Children’s Scholarship Fund; Club for Growth; Coalition for Jewish Values; Agudath Israel of America; Orthodox Union Advocacy; Republican Jewish Coalition; Concerned Women for America; Council for American Private Education (CAPE); Defense of Freedom Institute (DFI); Family Policy Alliance; Foundation for Excellence in Education (ExcelinEd); Freedom Foundation; Heartland Institute; Heritage Action for America; Home School Legal Defense Association (HSLDA); Independent Women’s Forum; Mountain States Policy Center; Parental Rights Foundation; Parents Defending Education Action; Partners in Mission; Project 21; Protect the First; 60Plus Association; Former Virginia & Florida Secretary of Education Gerard Robinson; and several other conservative leaders.

MIL OSI USA News –

January 30, 2025

MIL-OSI United Kingdom: Defence Secretary speech at the ADS Annual Dinner: 28 January 2025

Source: United Kingdom – Executive Government & Departments 3

Defence Secretary John Healey addressed the ADS Annual Dinner on 28 January 2025.

Good evening. Let me begin by thanking Kevin and his team at ADS for hosting this splendid event and for their work in promoting an industry that is the foundation for our way of life.

ADS is going from strength to strength, with a double digit increase in your membership last year.

You represent a commitment to innovation and excellence that are hallmarks of the British business spirit.

Yours is an industry which proves that we are still – at heart – a nation of makers and inventors. I know recent times haven’t been easy. And as Defence Secretary, I am grateful to you all.

This event brings us together from across the UK, across the industry and across the political divide.

I welcome this because defence policy and procurement commitments reach beyond political cycles.

I believe I’m the first Defence Secretary who’s spoken at this dinner, and tonight, you have two for the price of one with me as the warmup act for Penny Mourdant’s after dinner speech.

Penny is someone with a lifelong connection and commitment to our armed forces, who rose to become the first woman ever to hold the role of Defence Secretary.

I’ve had the privilege of six months in the role, part of a government taking on profound challenges in our economy, our public finances and our national security.

Yet, as a new government, we’ve already:

Stepped up and speeded up support for Ukraine…
Increased defence spending by nearly £3 billion…
Launched a first of its kind Strategic Defence Review…
Given service personnel the largest pay rise in over 20 years… and still dealt with a multi-billion in-year deficit…
Signed the landmark Trinity House Agreement with Germany…
Secured a huge deal to buy back over 36,000 military homes to improve forces housing and save taxpayers billions…
Set new targets to tackle the recruitment crisis…
Begun a transformational MOD reform programme…
And got the Armed Forces Commissioner Bill through the House of Commons to improve service life.

The point I want to make is that this is a new government that is delivering for defence.

Something which I was able to underline last Friday at Rolls Royce, announcing a major new contract over 8 years, which will boost British jobs, business and national security.

There’s incredible work being done there in Derby, by an incredible team, some of whom are here this evening.

It’s a big investment, but behind the numbers are 200 apprentices a year who now feel they have a future.

And suppliers – 92 per cent of which are British based – who now feel like have certainty.

What really struck me – and it happens every time I visit a defence site – is the deep sense of pride and purpose.

Defence workers are right to feel that way. Their efforts keep us all safe.

And as an industry, you also invest huge sums in research and development. One of the great strengths of the defence industry is that you force us to reach for the future.

Down the years, you’ve been responsible for some of the most significant innovations in history. Designed for times of war but which often produce lasting benefits for wider society well beyond the battlefield.

As a nation, we’re good – and rightly so – at taking pride in the professionalism of our soldiers, sailors and aviators.

But we know that that they are only as effective as the industry which equips them.

We must be better at celebrating the role of the coders, programmers, scientists and engineers who provide our forces with the tools they need to protect us.

It’s why I want us to not only change the way we work with the defence industry, but also change the way we see the defence industry.

On the way we work with industry, I hope the last few months serve as a glimpse of type of partnership we want to forge.

From industry involvement – for the first time ever – in our war gaming, to the creation of the new Defence Industrial Joint Council.

And on the way we see industry, we know we have much to do.

Right now, there’s growing security concerns for defence firms at university careers, you attend to offer young people a route to a better life.

You’re facing harassment and intimidation, forced to cancel events on campus. This is wrong.

This attitude takes for granted the privileged position we enjoy in Britain – to live in freedom and security… security our defence industry guarantees.

So, today – alongside the Business and Education Secretaries – I’ve written to Universities UK for assurances about your safety on campuses.

We’re also seeing defence firms ranked alongside tobacco and gambling in Environmental, Social and Governance audits. And pension funds divest from you.

I have no doubt the intentions are well-meaning. But they’re fundamentally flawed.

We don’t stop wars by boycotting our defence industry.

We stop wars by backing it.

Let’s not forget that national security is a pre-condition for economic security, investor confidence and social stability.

I will always be a fierce advocate for you in the Department, to wider government, to the City, to the British public and to whoever needs to hear it.

My challenge to you – as an industry – is to be louder and confident about your role.

As my friend – Jonny Reynolds– said to the President’s Reception earlier:

“You are exceptional in your importance… in helping to safeguard our national security and our way of life.

“But you are also exceptional in your contribution to our economy. Nearly half a million well paid jobs are directly owed to aerospace, defence, security and space sectors.”

To meet the challenges of this new era of threats, you’ve seen the direction we want to take with our Defence Industrial Strategy Statement of Intent.

And let me thank everyone who’s shared their insights so far in submissions to both our industrial strategy, and SDR consultations.

I know – for some – our Statement of Intent may have been met with a degree of scepticism. You’ve been here before… I get that…

New government, new ideas.

But old habits die hard and entrenched interests dig in.

Previous industrial strategies have produced policies – many of them good – but there wasn’t the plan, the structures and the relentless attention to reform needed to make change happen.

So, why will this be different?

First, it has to be different.

The war in Ukraine confronts us with the deep truth that when a country faces conflict or is forced to fight, its armed forces are only as strong as the industry which stands behind them…

That innovation and production capacity is a major part of our nation’s – and our alliance’s – deterrence.

And that industry’s constant purpose is to give the nation’s war fighters the advantage over our adversaries.

The last Defence Industrial Strategy was published in 2021, a year before Putin shattered the peace in Europe.

Ours will hardwire in these lessons and so too will the Strategic Defence Review.

Second, I’m driving deep reform to defence.

It doesn’t make news headlines, but it’s an essential foundation for implementing both the SDR and Defence Industrial Strategy.

For industry, it means you’ll be brought in earlier to the conversation on how we should fight…

We’ll ask you how you can help solve our problems rather than giving you a requirement to deliver.

You’ll also see the creation of a new role, the National Armaments Director, soon-to-be one of the most senior roles in UK Defence, sitting alongside the Chief of the Defence Staff and Permanent Secretary.

Their responsibilities will include:

Repairing a broken procurement system…
Ensuring our armed forces have what they need to fulfil their duty of protecting our nation…
And championing your industry at home and abroad.

Third, defence is part of our bigger British drive for growth – the government’s number one mission.

The Chancellor is speaking tomorrow about how we are going to meet this challenge.

But the message I want to reinforce is that defence is an engine for driving economic growth.

Fourth, we’ve proved we can do it by supporting Ukraine through Taskforce KINDRED and HIRST.

From the onset, when it took 287 days after Putin invaded to sign contracts for new NLAWs…

… to today, when we’ve created industrial bases for new capabilities – virtually from scratch…

Supplying – at scale – one of the most effective drone systems in Ukraine.

Restarted artillery barrel manufacturing in the UK to deliver hundreds to the front line.

Enhancing our own capabilities through Stormer and Starstreak…while Gravehawk, Snapper and Wasp have all been developed with breathtaking speed.

I don’t just want this to be the government’s new Defence Industrial Strategy, it needs to be a national endeavour… private and public… SMEs and primes… innovators and educators… trade associations and trade unions…

All creating a defence industry which is better and more integrated…

One that can keep our armed forces equipped… and innovating at wartime pace, ahead of our adversaries.

The Shadow Defence Secretary is familiar with the challenges.

I know he will play his part in holding us to account.

And I trust he – and his Party – will play their part in backing reforms that strengthen our country’s defence and its defence industry.

This is new era of threats, demands a new era for defence.

Change is essential, not optional.

Our success rests on a new partnership with innovators, investors and industry.

Our government is determined to meet the challenge, determined to deliver for defence.

Together, we will make Britain secure at home and strong abroad.

Thank you – enjoy your evening and I look forward to working with you over the coming years.

Published 29 January 2025

MIL OSI United Kingdom –

January 30, 2025

MIL-OSI Security: Defendant Extradited To Face Charges Related To International Bank Fraud And Money Laundering Ring That Caused Over $60 Million In Losses

Source: Office of United States Attorneys

Members of the Charged Conspiracy Opened Bank Accounts for Over 1,000 Fake Businesses to Receive and Launder the Proceeds of Fraudulent Schemes, Causing Actual Losses of Over $60 Million and Intended Losses of Over $150 Million

Danielle R. Sassoon, the United States Attorney for the Southern District of New York, and Patrick J. Freaney, the Special Agent in Charge of the New York Field Office of the United States Secret Service (“USSS”), announced today that ERICK JASON VICTORIA-BRTIO was extradited from the Dominican Republic and will appear in a federal courtroom in Manhattan later today. VICTORIA-BRITO is charged in a two-count Indictment with conspiring to commit bank fraud and money laundering from December 2017 through November 2022. In connection with the scheme, VICTORIA-BRITO and other members of the charged conspiracy registered over 1,000 fake businesses, used those fake businesses to open bank accounts to receive money stolen through business e-mail compromise schemes, and then laundered that money. Members of the conspiracy caused over $60 million in actual losses and attempted to steal over $150 million.

U.S. Attorney Danielle R. Sassoon said: “As we allege, Erick Jason Victoria-Brito and his co-conspirators ran an international bank fraud and money laundering scheme designed to help carry out business email compromise scams. These scams cause significant harm to businesses, nonprofits, and even local governments. As the successful extradition of Erick Jason Victoria-Brito shows, this Office and our partners will not rest until every individual responsible is held accountable.”

USSS Special Agent in Charge Patrick J. Freaney said: “This alleged scheme rained down financial ruin upon unwitting businesses and individuals. While the suspects operated with impunity across the nation and beyond, the U.S. Secret Service and its partners remained steadfast in building a strong case — no matter where the evidence took them. I commend the investigators and prosecutors for their commitment to disrupting this type of insidious fraud on behalf of all those victimized by it.”

As alleged in the Indictment, Superseding Indictments, and court filings:[1]

From at least December 2017 through at least November 2022, a group of individuals perpetrated a massive, international bank-fraud and money-laundering scheme (the “Fraud and Money Laundering Scheme”) designed to obtain and launder the proceeds of business e-mail compromise schemes. In a business email compromise scheme, a scheme member fraudulently induces a company or individual to send money to a bank account controlled by that scheme member or the scheme member’s compatriots.

The Fraud and Money Laundering Scheme operated across borders and preyed on businesses large and small. Between 2020 and 2021 alone, participants in the scheme stole tens of millions of dollars, targeting victims that included a major American sports organization, a publicly traded healthcare company, and a prominent international nonprofit organization, along with multiple city governments, law firms, construction companies, and investment funds. Participants in the Fraud and Money Laundering Scheme registered over 1,000 fake businesses, then used those businesses to open bank accounts. Those bank accounts then received the proceeds of business email compromise schemes. Once the stolen funds reached those fraudulent bank accounts, participants in the Fraud and Money Laundering Scheme worked quickly to take advantage of the international banking system by either withdrawing the money or helping to launder it by wiring it to overseas banks, thereby preventing victims from recouping their losses. The co-conspirators accomplished that primarily by wiring stolen money to banks in China, outside the reach of American banks. During the course of the charged conduct, members of the conspiracy participated in inflicting over $60 million in actual losses and attempted to inflict losses of over $150 million.

* * *

VICTORIA-BRITO, 30, of Hollywood, Florida, is charged with one count of conspiracy to commit bank fraud, which carries a maximum sentence of 30 years in prison, and one count of conspiracy to commit money laundering, which carries a maximum sentence of 20 years in prison.

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendants will be determined by a judge.

Ms. Sassoon praised the outstanding investigative work of the New York City Police Department, USSS, U.S. Postal Inspection Service, and Homeland Security Investigations. Ms. Sassoon further thanked the U.S. Treasury Inspector General for Tax Administration, the Federal Bureau of Investigation, and Internal Revenue Service-Criminal Investigations for their assistance.

This case is being handled by the Office’s General Crimes Unit. Assistant U.S. Attorneys Thomas S. Burnett and Amanda C. Weingarten are in charge of the prosecution.

The charges contained in the Indictment and Superseding Indictments are merely accusations, and the defendants are presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Indictment and Superseding Indictment, and the description of the Indictment and Superseding Indictment set forth herein, constitute only allegations, and every fact described herein should be treated as an allegation.

MIL Security OSI –

January 30, 2025

MIL-OSI Russia: Slovak Republic: Staff Concluding Statement of the 2025 Article IV Mission

Source: IMF – News in Russian

January 29, 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.

Washington, DC: An International Monetary Fund mission, led by Magnus Saxegaard, and comprising Christian Bogmans, Shinya Kotera, Yen Mooi, and Jonathan Pampolina conducted discussions for the 2025 Article IV consultation with the Slovak Republic virtually during December 4-13, 2024, and in Bratislava, Slovakia, during January 15-28, 2025. Sumiko Ogawa, Financial Sector Assessment Program (FSAP) mission chief, joined the concluding meeting. At the conclusion of the visit, the mission issued the following statement:

Slovakia, like much of the EU, faces headwinds related to geoeconomic fragmentation, high energy costs, and demographic change. Growth has held up in recent years, but at the cost of a much-increased fiscal deficit. Steadfast implementation of the authorities’ ambitious 4-year consolidation plan is needed to reverse the upward trajectory in public debt, alongside policies to strengthen financial resilience and structural reforms to bolster medium-term growth, including through efforts to strengthen governance and reduce vulnerability to corruption.

Economic Developments, Outlook, and Risks

The Slovak economy is recovering. The economy slowed sharply in 2022-23, but growth is estimated to have accelerated to 2.1 percent in 2024, outpacing that in the euro area. Private consumption was the main driver fueled by recovering real wages, the extension of household energy support, and more generous pensions. Meanwhile, an increase in public consumption partially offset a slowdown in EU-funded public investments. While inflation has declined from record-highs in 2023, it increased in 2024H2 due to higher global food price inflation. Core inflation is higher than in the euro area, driven by a tight labor market and strong nominal wage growth.

Economic growth is projected to moderate to 1.9 percent in 2025, before rising to 2.1 percent in 2026. The fiscal consolidation in 2025 will lower growth directly by slowing government spending, and indirectly as higher taxes put upward pressure on prices and dampen private consumption, though the effect will be partially mitigated by the one-year extension of household energy support and strong EU-funded public investments. Meanwhile external demand is expected to remain subdued. For 2026, higher growth in trading partners and increased capacity in the automotive sector is expected to boost exports. Inflation is projected to rise temporarily to 4.0 percent in 2025 and moderate to 3.2 percent in 2026. Adverse demographic trends and lower productivity growth imply that Slovakia’s medium-term growth, as projected by staff, is expected to be significantly lower than its pre-pandemic average, and below IMF forecasts of medium-term growth in other Central, Eastern, and Southeastern Europe (CESEE) countries with comparable income levels.

Risks to growth are tilted to the downside while risks to inflation are broadly balanced. Near term risks include a global slowdown or intensifying trade policy uncertainty which would weigh on growth and exert downward pressure on inflation. Domestically, slippages in fiscal consolidation could increase sovereign spreads and tighten financial conditions. A lack of political consensus on structural reforms and concerns about institutional quality could deter private investment and slow the disbursement of EU funds that have been critical in supporting public investment. A correction in real estate prices combined with an economic downturn could trigger losses for financial institutions. Meanwhile, continued strong nominal wage growth could undermine competitiveness and keep inflation elevated.

Fiscal Policy

Slovakia’s fiscal outlook is challenging. The fiscal deficit is projected to have increased to 5.7 percent in 2024 from 5.2 percent in 2023 due to a combination of revenue easing and higher spending that more than offset the 0.6 percent of GDP in net consolidation measures in the 2024 budget. This increase follows the 3.6 percentage points of GDP widening of the fiscal deficit in 2023. While the change in government in October 2023 meant time to finalize the 2024 budget was short, it is clear ex-post that robust growth combined with significant medium-term fiscal challenges would have warranted a tighter fiscal stance in 2024.

The mission welcomes the authorities’ ambitious fiscal consolidation targets for 2025-28, which is commensurate with the scale of Slovakia’s fiscal challenges.

The 2025 budget targets a reduction in the headline deficit to 4.7 percent of GDP. Fund staff’s more conservative macroeconomic forecasts imply an overall deficit of 4.9 percent of GDP in 2025. However, the projected structural tightening is broadly in line with the budget. These forecasts are subject to significant downside risks, including from a lower-than-expected yield from the fiscal consolidation measures or a worse economic outlook. If revenues in 2025 appear to be falling short of targets (as implied by staff’s macroeconomic forecasts) the authorities should limit the resulting increase in the deficit, including by saving as much as possible of the contingency buffer.
Beyond 2025, the medium-term fiscal structural plan targets another 2.5 percentage points of GDP reduction in the fiscal deficit to bring it close to 2 percent of GDP by 2028, though measures to achieve this consolidation are not yet specified. Staff projections suggest that the fiscal consolidation envisaged over the next four years, if met, will reverse the increase in the deficit over the past two years and put public debt on a downward path by the end of the projection period. Staff’s baseline forecast, which does not include any further consolidation beyond that in the 2025 budget, entails a gradual increase in the deficit over the medium term, with public debt rising to 75 percent of GDP by end-2030 from 56 percent of GDP in 2023.

The consolidation measures for 2025 are a step in the right direction. Several of the measures are welcome and will help reduce the deficit on a structural basis, including the increase in the basic VAT rate, and better targeting of child benefits. However, the increase in the number of items subject to reduced VAT rates deprives the government of much needed revenue, while the financial transactions tax (FTT) could weaken financial intermediation and increase incentives for informality.

The measures to lower Slovakia’s fiscal deficit closer to 2 percent of GDP by 2028 should be consistent with Slovakia’s long-term growth and climate objectives, while protecting the most vulnerable in society. While there is no definitive evidence that reducing spending is more effective than increasing revenues in terms of economic efficiency or equity, prioritizing the rationalization of expenditures moving forward would result in a more balanced fiscal consolidation, given the reliance on revenue-based measures thus far.

Spending: According to Fund staff estimates, value for Money initiatives, including a reduction in subsidies, could yield savings of up to 0.5 percent of GDP, while improved targeting could reduce social spending by as much as 0.8 percent of GDP. Also, there may be scope to increase efficiency by trimming departmental budgets and reducing public sector wage growth, though this should be done cautiously to avoid unintended cuts in service delivery. Reversing the increase of the 13^th pension could yield about 0.4 percent of GDP in savings while eliminating the recently introduced early retirement option could yield fiscal savings over the long-term. Finally, energy support measures to households (projected to cost 0.2 percent of GDP in 2025) should be phased out as they are costly and discourage energy conservation.
Revenues: Reducing the number of items subject to reduced VAT rates could generate as much as 1.3 percent of GDP in savings, while raising property taxes by transitioning to a market value-based system could generate around 0.3 percent in additional revenue. Plans to counter tax evasion and reduce the VAT compliance gap are welcome and could yield up to 0.5 percent of GDP in revenues. Finally, the authorities should replace the FTT with alternative revenue sources, while phasing out the bank levy as planned.

Safeguarding Slovakia’s strong fiscal framework is essential for the credibility of the consolidation effort. Aligning Slovakia’s national expenditure ceiling framework with the new EU fiscal rules avoids inconsistencies and streamlines the budget process but continued focus on the long-term fiscal outlook (beyond the horizon used for the EU fiscal framework) remains useful given Slovakia’s medium-term fiscal challenges. Slovakia’s strong and independent Council for Budgetary Responsibility can help by monitoring the impact of government policies on the long-term sustainability of public finances. Lastly, the mission recommends reforming the debt brake before it comes into effect in 2026, to avoid the risk of a disruptive fiscal consolidation.

The mission welcomes the government’s objective to increase absorption of EU funds. The Slovak government is working with the OECD and the European Commission to identify concrete measures to increase absorption. In this regard, there is a need to strengthen project management capacity, especially at the municipal level, while the preparation of a national investment plan could help guide the timely selection of investment projects.

Financial Sector Policy

The 2024 Financial Sector Assessment Program (FSAP)—an in-depth review of the financial sector—assessed the banking sector to be resilient against severe shocks, reflecting a healthy level of buffers and profitability. The residential real estate market remains a source of vulnerability. In particular, tighter financial conditions, an economic slowdown, and a decline in still-elevated house prices could put pressure on households’ repayment capacity and increase the riskiness of banks’ mortgage portfolios. Also, risks remain elevated in the office segment of the commercial real estate (CRE) market while banks with large exposures to firms facing geopolitical risks could be vulnerable to credit losses. That said, solvency stress tests indicate that banks have sufficient capital to withstand severe macro-financial shocks. Likewise, liquidity stress tests indicate that the banking system as a whole is resilient to funding and market liquidity shocks.

The current macroprudential stance is broadly appropriate, but the policy framework could be further developed over the medium term to help attenuate cyclical and structural risks.

Residual risks in the residential and CRE markets suggest the current level of the countercyclical capital buffer (CCyB) is appropriate. Borrower-based measures (BBMs) have contributed to contain household credit risk and should remain in force. The authorities should stand ready to activate the systemic risk buffer on banks’ CRE exposures before risks in the sector become systemic.
The macroprudential policy framework could be further strengthened by adopting a positive neutral countercyclical capital buffer (pnCCyB). A pnCCyB would help safeguard the availability of releasable capital and give policymakers time to collect evidence of a build-up in vulnerabilities. A healthy level of profitability and/or the availability of voluntary buffers would help facilitate a smooth introduction of a pnCCyB. In addition, remaining leakages in the BBMs (e.g. co-financing a mortgage with a consumer loan) should be closed, while the BBM speed limits should be differentiated across borrower categories (e.g. first- and second-time home buyers, investors, and mortgage top-ups).

Financial resilience could be bolstered by strengthening the supervision of less significant institutions (LSIs) as well as the crisis management framework.

The NBS’s supervisory powers and operational independence should be enhanced by restricting banks’ appeals only to supervisory decisions and corrective measures that are finalized, and by strengthening the legal protections for supervisors. Moreover, the NBS should streamline off-site supervision to align with LSI’s risk profile and strengthen on-site inspections to bolster the overall effectiveness of LSI supervision.
The financial safety net and crisis management framework should be reinforced by ensuring that the National Resolution Authority (NRA) has adequate resources, preventing the judiciary from suspending or reversing resolution decisions, ensuring NRA resolutions are immediately enforceable, and enhancing the legal protection of staff involved in resolution. Meanwhile, the authorities should remove active bankers from the board of the deposit guarantee fund to prevent conflicts of interest, while expanding the fund’s mandate and financial strength to enable it to play a broader role in crisis management.

Efforts to strengthen the AML/CFT framework should continue. In particular, the authorities should review the criteria for the application of ML/TF sanctions, strengthen coordination between the NBS and Financial Intelligence Unit, and introduce mechanisms to verify beneficial ownership information and sanction the submission of inaccurate information.

Structural Policy

Slovakia needs structural reforms to diversify its economy, enhance resilience to global shocks and sustain productivity growth. The success of the automotive sector has led to decades of strong growth but exposed Slovakia to global trends related to the green transition and automation. To improve resilience and sustain productivity growth the authorities should intensify efforts to promote innovation and technology adoption. In this context, the mission welcomes the increase in direct government R&D spending, but further efforts are needed to stimulate business R&D including in small firms and startups that are not yet profitable. At the same time, deepening the European single market would allow innovative firms to leverage economies of scale. Finally, advancing the capital market union would facilitate cross-border flows of capital including equity financing and venture capital, which is critical for supporting startups, particularly in countries with less-developed capital markets.

The automotive sector is facing headwinds related to the unfolding green transition and rapid rise of electronic vehicle (EV) production in other markets. To address these challenges, the authorities should encourage innovation across the entire domestic EV production supply chain, promote efforts to diversify the economy, and enhance Active Labor Market Policies (ALMPs) to facilitate the movement of workers across sectors.

The challenges of an aging population require policies to increase the labor force. Flexible working arrangements, shortening the 3-year long maximum parental leave period, and improved child and elderly care could increase female participation, while tax credits and restrictions on early retirement could raise labor force participation among the elderly. The recent easing of national visa rules for foreign workers in professions with shortages could boost migrant inflows, but further efforts are needed to integrate and retain migrants, including by scaling up language training and streamlining certification recognition. Increased focus on vocational education and training would help bring down Slovakia’s high youth unemployment.

Maintaining a favorable investment climate, strengthening governance, and reducing vulnerability to corruption will help lift the economy’s growth potential.

Governance indicators and perceptions of judicial independence lag peers, and recent surveys point to a decline in the perceived effectiveness of anti-corruption policies.
A new national anti-corruption strategy is expected to be released mid-year. In that context, the authorities should verify that the new institutional framework that replaced the dissolved Special Prosecutor’s Office and National Crime Agency has not weakened the institutional capacity to investigate and prosecute high-level corruption. Also, the asset declaration and conflict of interest framework for high-risk public officials could be improved. Specifically, broadening the scope of covered public officials, and centralizing and digitizing the submission and publication process with robust verification procedures and appropriate sanctions, would be beneficial. Finally, existing safeguards pertaining to the Prosecutor General’s authority to annul decisions by lower-level prosecutors should be strengthened.
Safeguards to ensure members of the Judicial Council can only be recalled based on specific and reasonable grounds would enhance judicial independence. Also, the crime of “abuse of law”, whereby judges are subject to criminal liability for their decisions, can have an intimidating effect on judges. Additional safeguards to ensure the framework balances the accountability of judges and independent judicial decision-making would be beneficial.

While greenhouse gas emissions have fallen by 50 percent since 1990, further efforts are needed to cut emissions by 55 percent by 2030 and to reach net-zero by 2050. Slovakia should move expeditiously to fully implement the ETS II scheme for road transport and buildings and could consider gradually raising environmental levies in these sectors until the scheme becomes operational in 2027. The authorities should continue exploring options to replace two coal-fired blast furnaces in the steel industry and phase out fossil fuel subsidies. Also, supporting environmental R&D and green technology would support mitigation efforts and economic diversification. Lastly, a more integrated energy market in Europe would encourage investment in renewables and enhance energy security and reduce energy prices.

The IMF team thanks the authorities and other interlocutors for their generous hospitality and constructive dialogue.

Table 1. Slovakia: Selected Economic Indicators, 2020–2030

IMF Communications Department

MEDIA RELATIONS

PRESS OFFICER: Boris Balabanov

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

https://www.imf.org/en/News/Articles/2025/01/29/mcs-012925-slovak-republic-staff-concluding-statement-of-the-2025-article-iv-mission

MIL OSI

MIL OSI Russia News –

January 30, 2025

MIL-OSI Economics: Slovak Republic: Staff Concluding Statement of the 2025 Article IV Mission

Source: International Monetary Fund

January 29, 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.

Washington, DC: An International Monetary Fund mission, led by Magnus Saxegaard, and comprising Christian Bogmans, Shinya Kotera, Yen Mooi, and Jonathan Pampolina conducted discussions for the 2025 Article IV consultation with the Slovak Republic virtually during December 4-13, 2024, and in Bratislava, Slovakia, during January 15-28, 2025. Sumiko Ogawa, Financial Sector Assessment Program (FSAP) mission chief, joined the concluding meeting. At the conclusion of the visit, the mission issued the following statement:

Slovakia, like much of the EU, faces headwinds related to geoeconomic fragmentation, high energy costs, and demographic change. Growth has held up in recent years, but at the cost of a much-increased fiscal deficit. Steadfast implementation of the authorities’ ambitious 4-year consolidation plan is needed to reverse the upward trajectory in public debt, alongside policies to strengthen financial resilience and structural reforms to bolster medium-term growth, including through efforts to strengthen governance and reduce vulnerability to corruption.

Economic Developments, Outlook, and Risks

The Slovak economy is recovering. The economy slowed sharply in 2022-23, but growth is estimated to have accelerated to 2.1 percent in 2024, outpacing that in the euro area. Private consumption was the main driver fueled by recovering real wages, the extension of household energy support, and more generous pensions. Meanwhile, an increase in public consumption partially offset a slowdown in EU-funded public investments. While inflation has declined from record-highs in 2023, it increased in 2024H2 due to higher global food price inflation. Core inflation is higher than in the euro area, driven by a tight labor market and strong nominal wage growth.

Economic growth is projected to moderate to 1.9 percent in 2025, before rising to 2.1 percent in 2026. The fiscal consolidation in 2025 will lower growth directly by slowing government spending, and indirectly as higher taxes put upward pressure on prices and dampen private consumption, though the effect will be partially mitigated by the one-year extension of household energy support and strong EU-funded public investments. Meanwhile external demand is expected to remain subdued. For 2026, higher growth in trading partners and increased capacity in the automotive sector is expected to boost exports. Inflation is projected to rise temporarily to 4.0 percent in 2025 and moderate to 3.2 percent in 2026. Adverse demographic trends and lower productivity growth imply that Slovakia’s medium-term growth, as projected by staff, is expected to be significantly lower than its pre-pandemic average, and below IMF forecasts of medium-term growth in other Central, Eastern, and Southeastern Europe (CESEE) countries with comparable income levels.

Risks to growth are tilted to the downside while risks to inflation are broadly balanced. Near term risks include a global slowdown or intensifying trade policy uncertainty which would weigh on growth and exert downward pressure on inflation. Domestically, slippages in fiscal consolidation could increase sovereign spreads and tighten financial conditions. A lack of political consensus on structural reforms and concerns about institutional quality could deter private investment and slow the disbursement of EU funds that have been critical in supporting public investment. A correction in real estate prices combined with an economic downturn could trigger losses for financial institutions. Meanwhile, continued strong nominal wage growth could undermine competitiveness and keep inflation elevated.

Fiscal Policy

Slovakia’s fiscal outlook is challenging. The fiscal deficit is projected to have increased to 5.7 percent in 2024 from 5.2 percent in 2023 due to a combination of revenue easing and higher spending that more than offset the 0.6 percent of GDP in net consolidation measures in the 2024 budget. This increase follows the 3.6 percentage points of GDP widening of the fiscal deficit in 2023. While the change in government in October 2023 meant time to finalize the 2024 budget was short, it is clear ex-post that robust growth combined with significant medium-term fiscal challenges would have warranted a tighter fiscal stance in 2024.

The mission welcomes the authorities’ ambitious fiscal consolidation targets for 2025-28, which is commensurate with the scale of Slovakia’s fiscal challenges.

The 2025 budget targets a reduction in the headline deficit to 4.7 percent of GDP. Fund staff’s more conservative macroeconomic forecasts imply an overall deficit of 4.9 percent of GDP in 2025. However, the projected structural tightening is broadly in line with the budget. These forecasts are subject to significant downside risks, including from a lower-than-expected yield from the fiscal consolidation measures or a worse economic outlook. If revenues in 2025 appear to be falling short of targets (as implied by staff’s macroeconomic forecasts) the authorities should limit the resulting increase in the deficit, including by saving as much as possible of the contingency buffer.
Beyond 2025, the medium-term fiscal structural plan targets another 2.5 percentage points of GDP reduction in the fiscal deficit to bring it close to 2 percent of GDP by 2028, though measures to achieve this consolidation are not yet specified. Staff projections suggest that the fiscal consolidation envisaged over the next four years, if met, will reverse the increase in the deficit over the past two years and put public debt on a downward path by the end of the projection period. Staff’s baseline forecast, which does not include any further consolidation beyond that in the 2025 budget, entails a gradual increase in the deficit over the medium term, with public debt rising to 75 percent of GDP by end-2030 from 56 percent of GDP in 2023.

The consolidation measures for 2025 are a step in the right direction. Several of the measures are welcome and will help reduce the deficit on a structural basis, including the increase in the basic VAT rate, and better targeting of child benefits. However, the increase in the number of items subject to reduced VAT rates deprives the government of much needed revenue, while the financial transactions tax (FTT) could weaken financial intermediation and increase incentives for informality.

The measures to lower Slovakia’s fiscal deficit closer to 2 percent of GDP by 2028 should be consistent with Slovakia’s long-term growth and climate objectives, while protecting the most vulnerable in society. While there is no definitive evidence that reducing spending is more effective than increasing revenues in terms of economic efficiency or equity, prioritizing the rationalization of expenditures moving forward would result in a more balanced fiscal consolidation, given the reliance on revenue-based measures thus far.

Spending: According to Fund staff estimates, value for Money initiatives, including a reduction in subsidies, could yield savings of up to 0.5 percent of GDP, while improved targeting could reduce social spending by as much as 0.8 percent of GDP. Also, there may be scope to increase efficiency by trimming departmental budgets and reducing public sector wage growth, though this should be done cautiously to avoid unintended cuts in service delivery. Reversing the increase of the 13^th pension could yield about 0.4 percent of GDP in savings while eliminating the recently introduced early retirement option could yield fiscal savings over the long-term. Finally, energy support measures to households (projected to cost 0.2 percent of GDP in 2025) should be phased out as they are costly and discourage energy conservation.
Revenues: Reducing the number of items subject to reduced VAT rates could generate as much as 1.3 percent of GDP in savings, while raising property taxes by transitioning to a market value-based system could generate around 0.3 percent in additional revenue. Plans to counter tax evasion and reduce the VAT compliance gap are welcome and could yield up to 0.5 percent of GDP in revenues. Finally, the authorities should replace the FTT with alternative revenue sources, while phasing out the bank levy as planned.

Safeguarding Slovakia’s strong fiscal framework is essential for the credibility of the consolidation effort. Aligning Slovakia’s national expenditure ceiling framework with the new EU fiscal rules avoids inconsistencies and streamlines the budget process but continued focus on the long-term fiscal outlook (beyond the horizon used for the EU fiscal framework) remains useful given Slovakia’s medium-term fiscal challenges. Slovakia’s strong and independent Council for Budgetary Responsibility can help by monitoring the impact of government policies on the long-term sustainability of public finances. Lastly, the mission recommends reforming the debt brake before it comes into effect in 2026, to avoid the risk of a disruptive fiscal consolidation.

The mission welcomes the government’s objective to increase absorption of EU funds. The Slovak government is working with the OECD and the European Commission to identify concrete measures to increase absorption. In this regard, there is a need to strengthen project management capacity, especially at the municipal level, while the preparation of a national investment plan could help guide the timely selection of investment projects.

Financial Sector Policy

The 2024 Financial Sector Assessment Program (FSAP)—an in-depth review of the financial sector—assessed the banking sector to be resilient against severe shocks, reflecting a healthy level of buffers and profitability. The residential real estate market remains a source of vulnerability. In particular, tighter financial conditions, an economic slowdown, and a decline in still-elevated house prices could put pressure on households’ repayment capacity and increase the riskiness of banks’ mortgage portfolios. Also, risks remain elevated in the office segment of the commercial real estate (CRE) market while banks with large exposures to firms facing geopolitical risks could be vulnerable to credit losses. That said, solvency stress tests indicate that banks have sufficient capital to withstand severe macro-financial shocks. Likewise, liquidity stress tests indicate that the banking system as a whole is resilient to funding and market liquidity shocks.

The current macroprudential stance is broadly appropriate, but the policy framework could be further developed over the medium term to help attenuate cyclical and structural risks.

Residual risks in the residential and CRE markets suggest the current level of the countercyclical capital buffer (CCyB) is appropriate. Borrower-based measures (BBMs) have contributed to contain household credit risk and should remain in force. The authorities should stand ready to activate the systemic risk buffer on banks’ CRE exposures before risks in the sector become systemic.
The macroprudential policy framework could be further strengthened by adopting a positive neutral countercyclical capital buffer (pnCCyB). A pnCCyB would help safeguard the availability of releasable capital and give policymakers time to collect evidence of a build-up in vulnerabilities. A healthy level of profitability and/or the availability of voluntary buffers would help facilitate a smooth introduction of a pnCCyB. In addition, remaining leakages in the BBMs (e.g. co-financing a mortgage with a consumer loan) should be closed, while the BBM speed limits should be differentiated across borrower categories (e.g. first- and second-time home buyers, investors, and mortgage top-ups).

Financial resilience could be bolstered by strengthening the supervision of less significant institutions (LSIs) as well as the crisis management framework.

The NBS’s supervisory powers and operational independence should be enhanced by restricting banks’ appeals only to supervisory decisions and corrective measures that are finalized, and by strengthening the legal protections for supervisors. Moreover, the NBS should streamline off-site supervision to align with LSI’s risk profile and strengthen on-site inspections to bolster the overall effectiveness of LSI supervision.
The financial safety net and crisis management framework should be reinforced by ensuring that the National Resolution Authority (NRA) has adequate resources, preventing the judiciary from suspending or reversing resolution decisions, ensuring NRA resolutions are immediately enforceable, and enhancing the legal protection of staff involved in resolution. Meanwhile, the authorities should remove active bankers from the board of the deposit guarantee fund to prevent conflicts of interest, while expanding the fund’s mandate and financial strength to enable it to play a broader role in crisis management.

Efforts to strengthen the AML/CFT framework should continue. In particular, the authorities should review the criteria for the application of ML/TF sanctions, strengthen coordination between the NBS and Financial Intelligence Unit, and introduce mechanisms to verify beneficial ownership information and sanction the submission of inaccurate information.

Structural Policy

Slovakia needs structural reforms to diversify its economy, enhance resilience to global shocks and sustain productivity growth. The success of the automotive sector has led to decades of strong growth but exposed Slovakia to global trends related to the green transition and automation. To improve resilience and sustain productivity growth the authorities should intensify efforts to promote innovation and technology adoption. In this context, the mission welcomes the increase in direct government R&D spending, but further efforts are needed to stimulate business R&D including in small firms and startups that are not yet profitable. At the same time, deepening the European single market would allow innovative firms to leverage economies of scale. Finally, advancing the capital market union would facilitate cross-border flows of capital including equity financing and venture capital, which is critical for supporting startups, particularly in countries with less-developed capital markets.

The automotive sector is facing headwinds related to the unfolding green transition and rapid rise of electronic vehicle (EV) production in other markets. To address these challenges, the authorities should encourage innovation across the entire domestic EV production supply chain, promote efforts to diversify the economy, and enhance Active Labor Market Policies (ALMPs) to facilitate the movement of workers across sectors.

The challenges of an aging population require policies to increase the labor force. Flexible working arrangements, shortening the 3-year long maximum parental leave period, and improved child and elderly care could increase female participation, while tax credits and restrictions on early retirement could raise labor force participation among the elderly. The recent easing of national visa rules for foreign workers in professions with shortages could boost migrant inflows, but further efforts are needed to integrate and retain migrants, including by scaling up language training and streamlining certification recognition. Increased focus on vocational education and training would help bring down Slovakia’s high youth unemployment.

Maintaining a favorable investment climate, strengthening governance, and reducing vulnerability to corruption will help lift the economy’s growth potential.

Governance indicators and perceptions of judicial independence lag peers, and recent surveys point to a decline in the perceived effectiveness of anti-corruption policies.
A new national anti-corruption strategy is expected to be released mid-year. In that context, the authorities should verify that the new institutional framework that replaced the dissolved Special Prosecutor’s Office and National Crime Agency has not weakened the institutional capacity to investigate and prosecute high-level corruption. Also, the asset declaration and conflict of interest framework for high-risk public officials could be improved. Specifically, broadening the scope of covered public officials, and centralizing and digitizing the submission and publication process with robust verification procedures and appropriate sanctions, would be beneficial. Finally, existing safeguards pertaining to the Prosecutor General’s authority to annul decisions by lower-level prosecutors should be strengthened.
Safeguards to ensure members of the Judicial Council can only be recalled based on specific and reasonable grounds would enhance judicial independence. Also, the crime of “abuse of law”, whereby judges are subject to criminal liability for their decisions, can have an intimidating effect on judges. Additional safeguards to ensure the framework balances the accountability of judges and independent judicial decision-making would be beneficial.

While greenhouse gas emissions have fallen by 50 percent since 1990, further efforts are needed to cut emissions by 55 percent by 2030 and to reach net-zero by 2050. Slovakia should move expeditiously to fully implement the ETS II scheme for road transport and buildings and could consider gradually raising environmental levies in these sectors until the scheme becomes operational in 2027. The authorities should continue exploring options to replace two coal-fired blast furnaces in the steel industry and phase out fossil fuel subsidies. Also, supporting environmental R&D and green technology would support mitigation efforts and economic diversification. Lastly, a more integrated energy market in Europe would encourage investment in renewables and enhance energy security and reduce energy prices.

The IMF team thanks the authorities and other interlocutors for their generous hospitality and constructive dialogue.

Table 1. Slovakia: Selected Economic Indicators, 2020–2030

IMF Communications Department

MEDIA RELATIONS

PRESS OFFICER: Boris Balabanov

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

MIL OSI Economics –

January 30, 2025

MIL-OSI: 2024 Q4 Revenue

Source: GlobeNewswire (MIL-OSI)

€994.6 million in total revenue for 2024, down -5.9%, reflecting the Group’s strategic orientations
- Prioritizing margins over revenue growth
- Managed decrease in the most mature markets
- Focus on the Group’s profitable growth drivers, primarily in Germany and in Energy activities
Q4: €251.8 million in revenue, down -12.4%
- Q4 2023 comparison basis particularly high
- Impact of selectivity measures implemented in Q2 in the telecom sector in France and Spain
- Fiber activity in Belgium remains low as negotiations continue between telco service providers seeking to pool their investments.
- Strong growth in Germany, the group’s future third pillar: +51%
- Strong growth in Energy activities: +30%
2024 full-year margin outlook confirmed
- Improvement of the Group’s adjusted EBITDA margin
- Increase in adjusted EBITDA despite the revenue decline, demonstrating the relevance of the Group’s reinforced selectivity strategy

	12 months			Q4
In millions of euros (unaudited)	2024	2023	% change	2024	2023	% change
Group	994.6	1,057.0	-5.9%	251.8	287.3	-12.4%
Benelux	371.6	381.6	-2.6%	92.7	112.0	-17.2%
France	360.6	403.3	-10.6%	90.5	105.6	-14.3%
Other Countries	262.4	272.1	-3.6%	68.6	69.7	-1.6%

Gianbeppi Fortis, Chief Executive Officer of Solutions30, stated: “As previously announced, Solutions30’s 2024 revenue trends reflect the Group’s strategic priorities, with a stronger focus on margins over revenue growth in a mixed market environment. In the fourth quarter, we continued to selectively scale back our revenue in our most mature segments, particularly in telecoms in France and Spain, in order to enhance operating margins. Meanwhile, fiber activity in Belgium remained temporarily subdued due to ongoing negotiations between service providers. At the same time, our key growth drivers – primarily Germany and energy transition-related services – continued to expand. Notably, energy services now represent nearly 20% of our fourth-quarter revenue. We confirm our objective of increasing the Group’s adjusted EBITDA for the full year 2024, despite the revenue decrease. This demonstrates our ability to significantly improve operating margins and highlights the effectiveness of our selectivity strategy in the market environment we faced in 2024.”

Consolidated revenue

In 2024, Solutions30’s consolidated revenue stood at €994.6 million, down -5.9% compared to 2023. This includes an organic contraction of -6.5%, a +0.2% impact from acquisitions, and a +0.4% favorable exchange rate effect.

It also reflects the Group’s strategic objectives, as outlined during the Capital Markets Day on September 26, 2024, in a context where Solutions30 operates across markets and business segments at different stages of maturity. The Group has chosen to increasingly prioritize margins over revenue growth, leading to a scaling down in the French and Spanish telecom sectors, where certain contracts no longer met profitability requirements. At the same time, Solutions30 is accelerating the expansion of its profitable growth drivers in Germany and in the energy sector.

Q4 consolidated revenue stood at €251.8 million, down -12.4% (-12.9% organically) compared to Q4 2023, which represented a particularly high basis for comparison (€287.3 million). Trends in Q4 remained in line with those observed in Q3, with: (i) the impact of selectivity measures implemented in Q2 in the French and Spanish telecom sectors, (ii) continued low levels of activity in Benelux, largely due to ongoing negotiations between Belgian service providers seeking to pool their fiber roll-out investments, and (iii) continued strong momentum in the Group’s key growth drivers: Germany, where fiber deployments are accelerating rapidly, and Energy services, a business the Group is successfully expanding.

Benelux

2024 Q4 revenue in Benelux stood at €92.7 million, down -17.2% (-17.6% organically) from a particularly high comparison basis (+61% in Q4 of 2023). Connectivity activities posted revenue of €67.3 million in Q4, down
-26%. In Belgium, fiber optic deployment remained hindered by ongoing negotiations between telecom service providers seeking to streamline nationwide deployment. These negotiations continued to cause delays in activity for Solutions30, with the impact further amplified in Q4 by the merger of two of its local clients, Proximus and Fiberklaar, which led to discussions on adapting operational processes.

Revenue from Energy activities reached €16.4 million in Q4, posting a modest 1.8% increase. While the roll-out of smart meters in Flanders has reached a plateau, further roll-outs in Wallonia and growth in network services are expected to drive momentum in the coming quarters. Meanwhile, Energy services in the Netherlands have slowed down due to electrical grid congestion, which is expected to prompt additional infrastructure investments.

Technology Solutions remained strong, generating €9.0 million in revenue, up +67%, driven by the launch of a new IT support contract.

2024 annual revenue in Benelux reached €371.6 million, down slightly by -2.6% (-2.8% organically), after extremely strong growth (+72%) in 2023.

France

In France, 2024 Q4 revenue was €90.5 million, down -14.3% on an organic basis. This decrease is primarily attributable to Connectivity activities, which contracted by -38.2% to €45.2 million, following the selectivity measures implemented since the second quarter. As part of its strategic focus on profitability, the Group has significantly reduced its exposure to certain contracts that no longer met its profitability standards, with the impact further amplified by the slowdown in the fiber deployment market observed since the beginning of the year.

The Group continues to successfully expand its Energy business, which posted strong growth of +54% in the fourth quarter, reaching €26.0 million in revenue, or 29% of the total. Supported by highly favorable structural trends, this segment is gradually establishing itself as a major growth driver for Solutions30, particularly in the photovoltaic sector, where the Group is achieving significant commercial and operational successes, recording a +72% increase in the fourth quarter. Momentum also remains strong in energy network services, which grew by +61% over the period.

Technology activities sustain a strong momentum, generating €19.3 million in revenue in Q4, up +24%. Following an exceptional surge in business during the 2024 Paris Olympics in Q2, IT support services continued to grow strongly, driven by the expansion of Internet of Things solutions, particularly the installation of smart thermostats.

Annual revenue for France in 2024 stood at €360.6 million, down -10.6%, including a -11% organic contraction and a +0.4% contribution from recent acquisitions.

Other Countries

In Other countries, the group generated €68.6 million in revenue in Q4 2024, down slightly by -1.6%. This includes an organic decline of -3.4% and a positive currency impact of +1.8%, reflecting the appreciation of the zloty and pound sterling against the euro during this period.

In Germany, Solutions30 is capitalizing on exceptional market momentum, with 2024 Q4 revenue increasing by +51.3% to €24.6 million. Coaxial network services remain strong while fiber growth is picking up speed. Firmly established with the leading national telecom operators, the Group has the organization, expertise, and resources required to play a key role in accelerating roll-outs in the coming quarters.

Solutions30 has continued to grow in Poland, with +6.4% revenue growth in Q4, reaching €15.1 million. While it has, until now, focused on Connectivity activities in this country, the Group recently won two electric vehicle charging infrastructure contracts with two major players, Ekoenergetyka and Inbalance Grid (see press release dated January 8, 2025).

In Italy, Q4 revenue totaled €14.5 million. Business has returned to growth, posting a +6.2% increase over the period. However, this growth is offset by the positive impact of 2023 negotiations with the Group’s main Italian client, which was fully accounted for in Q4 2023, despite covering the entire fiscal year. This distorts the comparison, resulting in an apparent -10.6% decline in Q4 2024.

In Spain, revenue amounted to €7.3 million, down -44.1% due to steps taken in Q2 to reduce the Group’s exposure to the mature telecoms market. The restructuring of the Connectivity business and the refocus on the Energy and Technology activities are ongoing.

Finally, In the United Kingdom, revenue came in at €7.2 million, down -28.4% compared to Q4 2023. The Group continues to shift its focus toward the fiber and energy services markets, driven by a newly appointed local management team.

In 2024, annual revenue for Other Countries was €262.4 million, down -3.6%, including a -5.0% organic contraction and a positive exchange rate effect of +1.4%.

2024 full-year margin outlook confirmed

For the whole of 2024, Solutions30 confirms its outlook for an improvement in its adjusted EBITDA margin, as well as an increase in adjusted EBITDA in absolute terms, despite the decline in revenue. This demonstrates the effectiveness of the selectivity strategy implemented by the Group in 2024.

Governance

Today the Supervisory Board appointed Mrs. Paola Bruno as Vice Chair of the Supervisory Board. A valued member of the Supervisory Board since 2023, Paola Bruno will continue to bring her extensive experience in corporate finance and strategy to this leadership role and to Solutions30 organization as a whole.

Webcast for Investors and Analysts
Date: Wednesday, January 29, 2025
6:30 PM (CET) – 5:30 PM (GMT)

Speakers
Gianbeppi Fortis, Chief Executive Officer
Amaury Boilot, Group General Secretary

Connection Details
Webcast in French: https://channel.royalcast.com/landingpage/solutions30-fr/20250129_1/

Upcoming Events

2024 Earnings Report March 31, 2025

About Solutions30 SE

Solutions30 provides consumers and businesses with access to the key technological advancements that are shaping our everyday lives, especially those driving the digital transformation and energy transition. With its network of more than 16,000 technicians, Solutions30 has completed over 65 million call-outs since its inception and led over 500 renewable energy projects with a combined maximum output surpassing 1600 MWp. Every day, Solutions30 is doing its part to build a more connected and sustainable world. Solutions30 has become an industry leader in Europe with operations in 10 countries: France, Italy, Germany, the Netherlands, Belgium, Luxembourg, Spain, Portugal, the United Kingdom, and Poland.
The capital of Solutions30 SE consists of 107,127,984 shares, equal to the number of theoretical votes that can be exercised. Solutions30 SE is listed on the Euronext Paris exchange (ISIN FR0013379484- code S30).
Indices : CAC Mid & Small | CAC Small | CAC Technology | Euro Stoxx Total Market Technology | Euronext Tech Croissance.
Visit our website for more information: www.solutions30.com.

Contact

Individual Shareholders:
Tel: +33 (0)1 86 86 00 63 – shareholders@solutions30.com

Analysts/Investors:
investor.relations@solutions30.com

Press – Image 7:
Charlotte Le Barbier – Tel: +33 6 78 37 27 60 – clebarbier@image7.fr

Attachment

PR Q4 29012025

The MIL Network –

January 30, 2025

MIL-OSI Security: Former FBI Employee Sentenced for Paycheck Protection Program Fraud

Source: Office of United States Attorneys

SAN ANTONIO – A former FBI employee was sentenced in a federal court in San Antonio to three months of home confinement and five years of probation for one count of wire fraud related to fraudulent use of the Paycheck Protection Program (PPP).

According to court documents, Christopher James Phillips, 41, of Schertz, formed Phillips Global Realty LLC on Dec. 20, 2019 and submitted a PPP application on May 29, 2020, using his FBI-issued credentials to confirm his identity. In his application, Phillips represented that he employed two individuals and had an average monthly payroll of $15,000. Additionally, he submitted an IRS Form 941 (Employer’s Quarterly Federal Tax Return) for the fourth quarter of 2019, claiming a payroll of $50,000 over the three-month period. IRS records indicate that Phillips did not file such a form any time between 2019 and 2022, meaning the Form 941 he submitted as part of his PPP loan application was fraudulent and the representations were false.

Phillips also certified that PPP funds would be spent only on authorized expenses, to include payroll, utilities, rent and mortgage interest. On June 2, 2020, he received $37,500 in PPP funds. Six days later, on June 8, Phillips wired $25,000 to a personal trading account and subsequently lost all of it due to trading activities. On June 9, 2020, he made a $5,117 payment toward his personal auto loan. On June 16, 2020, he paid approximately $8,500 toward his home mortgage.

Phillips was indicted Jan. 3, 2024 for one count of wire fraud and one count of engaging in monetary transaction over $10,000 using criminally derived proceeds. He was arrested Jan. 5, 2024 and released that day on a $30,000 bond. Phillips pleaded guilty to the wire fraud charge Sept. 18, 2024. In addition to his home confinement and probation, Phillips was ordered to pay $39,771 in restitution.

“The United States government will aggressively prosecute criminals, even if those individuals work within our own ranks,” said U.S. Attorney Jaime Esparza for the Western District of Texas. “As a result of his actions, Phillips is now a convicted felon and will spend the next five years under the watchful eye of the United States Probation Department. This sentencing should send a message to all government personnel who would consider using their position for personal gain. This office will carry out its duty and seek to hold you accountable for betraying the invaluable trust of the American people.”

The FBI investigated the case.

Assistant U.S. Attorney Justin Simmons prosecuted the case.

###

MIL Security OSI –

January 30, 2025

MIL-OSI: Juniata Valley Financial Corp. Announces Quarter and Year End December 31, 2024 Results

Source: GlobeNewswire (MIL-OSI)

Mifflintown, PA, Jan. 29, 2025 (GLOBE NEWSWIRE) — Juniata Valley Financial Corp. (OTCQX:JUVF) (“Juniata”) announced net income for the three months ended December 31, 2024 of $1.5 million compared to net income of $1.7 million for the three months ended December 31, 2023. Earnings per share, basic and diluted, was $0.30 for the three months ended December 31, 2024, compared to $0.33 for the three months ended December 31, 2023. Net income for the year ended December 31, 2024 was $6.2 million compared to net income of $6.6 million for the year ended December 31, 2023. Basic and diluted earnings per share were $1.25 and $1.24, respectively, for the year ended December 31, 2024 compared to basic and diluted earnings per share of $1.32 and $1.31, respectively, for the corresponding 2023 period.

President’s Message

President and Chief Executive Officer, Marcie A. Barber stated, “The Federal Reserve Bank rate decreases made in the last four months of 2024 contributed to a reversal in the last quarter of 2024 of the net interest margin compression trend in prior periods. Our net interest margin increased by twelve basis points compared to last year’s fourth quarter. In addition to an improved margin, we are pleased that our strategies to increase non-interest income have been successful resulting in substantial growth in both the fourth quarter of 2024 and the 2024 year. The decrease in fourth quarter net income compared to last year was due to several one-time noninterest expense items. Our credit quality remains strong with nonperforming loans totaling only 0.1% of the total loan portfolio and delinquent and nonperforming loans comprising just 0.4% of the portfolio. We are optimistic heading into 2025 that we can achieve accelerated loan growth while maintaining our excellent credit quality through increased efforts to cultivate loan and deposit relationships outside of our branch footprint coupled with exploring opportunities for expansion.”

Financial Results for the 2024 Year

Return on average assets for the year ended December 31, 2024, was 0.72%, compared to the return on average assets of 0.79% for the year ended December 31, 2023. Return on average equity for the year ended December 31, 2024 was 14.19%, compared to the return on average equity of 18.20% for the year ended December 31, 2023.

Net interest income was $22.9 million for the year ended December 31, 2024 compared to $22.7 million for 2023. Average interest earning assets increased $15.7 million, or 1.9%, to $853.9 million, for the year ended December 31, 2024, compared to the same period in 2023, due primarily to an increase of $34.6 million, or 6.9%, in average loans. The increase in average loans was partially offset by a decline of $20.1 million, or 6.1%, in average investment securities as the amortization on the mortgage-backed securities portfolio was used to fund loan growth rather than being reinvested into the securities portfolio. Average interest bearing liabilities increased by $14.3 million, or 2.4%, for the year ended December 31, 2024 compared to the comparable 2023 period, due primarily to growth in average time deposits as well as short-term borrowings and repurchase agreements. The yield on average loans increased by 47 basis points for the year ended December 31, 2024 compared to the year ended December 31, 2023, while the costs of average interest bearing deposits increased by 116 basis points, and short- and long-term borrowings and other interest bearing liabilities increased by a total of 85 basis points. These increases were primarily the result of higher market interest rates and competitive pricing pressure between periods. The yield on earning assets increased 39 basis points, to 4.35%, for the year ended December 31, 2024 compared to the year ended December 31, 2023, while the cost to fund interest earning assets with interest bearing liabilities increased 56 basis points, to 2.31%. The net interest margin, on a fully tax equivalent basis, decreased from 2.74% for the year ended December 31, 2023 to 2.71% for the year ended December 31, 2024.

Juniata recorded a provision for credit losses of $534,000 for the year ended December 31, 2024, compared to a provision for credit losses of $500,000 for the year ended December 31, 2023.

Non-interest income was $5.8 million for the year ended December 31, 2024 compared to $5.3 million for the year ended December 31, 2023, an increase of 9.5%. Most significantly impacting the comparative year end periods were increases of $391,000 in customer service fees, $98,000 in the change in value of equity securities and $182,000 in fees derived from loan activity. These increases were partially offset by a $105,000 decrease in life insurance proceeds compared to the 2023 period.

Non-interest expense was $21.0 million for the year ended December 31, 2024 compared to $19.9 million for the year ended December 31, 2023. Most significantly impacting non-interest expense for the comparative year end periods was an increase of $568,000 in employee compensation expense due to annual salary increases, overtime pay from the core conversion in the first quarter of 2024 and having one additional pay period in 2024. Also impacting the comparative year end periods was an increase of $123,000 in occupancy expense due to an increase in rental expense from the early termination of a branch office lease in December 2024, as well as increases of $204,000 in equipment expense and $286,000 in professional fees. These increases were partially offset by a decrease of $227,000 in merger and acquisition expense due to the Path Valley branch acquisition in 2023 with no similar transaction occurring in the 2024 period.

An income tax provision of $979,000 was recorded for the year ended December 31, 2024 compared to an income tax provision of $970,000 recorded for the year ended December 31, 2023. Juniata qualifies for a federal tax credit for investments in low-income housing partnerships. The tax credit decreased $37,000, or 10.1%, from $366,000 in the year ended December 31, 2023 to $329,000 in the year ended December 31, 2024, due to the completion of the amortization period for one of Juniata’s low-income housing partnership investments in January 2023.

Financial Results for the Quarter

Annualized return on average assets for the three months ended December 31, 2024 was 0.70%, compared to 0.79% for the three months ended December 31, 2023. Annualized return on average equity for the three months ended December 31, 2024 was 12.79%, compared to 18.06% for the three months ended December 31, 2023.

Net interest income was $5.8 million for the three months ended December 31, 2024 compared to $5.6 million for the three months ended December 31, 2023. Average interest earning assets were relatively the same between the comparable three month periods, decreasing by $280,000, to $847.1 million compared to the 2023 period, with average loans increasing $18.9 million, or 3.6%, and average investment securities decreasing $18.7 million, or 5.8%, over the comparable three month periods. Average interest bearing liabilities increased by $15.8 million, or 2.6%, compared to the comparable 2023 period, primarily due to growth in average short-term borrowings and repurchase agreements. When comparing the three months ended December 31, 2024 to the three months ended December 31, 2023, the yield on average loans increased by 36 basis points, and the rates on average time deposits increased by 67 basis points, primarily due to competitive pricing pressures, while the rates on average short- and long-term borrowings and other interest bearing liabilities decreased by 77 basis points, primarily due to a decline in market interest rates between periods. The yield on earning assets increased 29 basis points, to 4.39%, for the three months ended December 31, 2024 compared to same period in 2023, while the cost to fund interest earning assets with interest bearing liabilities increased 18 basis points, to 2.26%. The net interest margin, on a fully tax equivalent basis, increased from 2.64% for the three months ended December 31, 2023, to 2.76% for the three months ended December 31, 2024.

Juniata recorded a provision for credit losses of $63,000 for the three months ended December 31, 2024 compared to a provision for credit losses of $89,000 for the three months ended December 31, 2023.

Non-interest income was $1.6 million for the three months ended December 31, 2024 and $1.4 million for the three months ended December 31, 2023, an increase of 12.4%. Most significantly impacting non-interest income in the comparative three month periods were increases of $109,000 in customer service fees and $56,000 in life insurance proceeds, as well as $68,000 in fees derived from loan activity, primarily due to the addition of back-to-back swap fees and an increase in title insurance commissions and letter of credit fees. Partially offsetting these increases was a decrease of $46,000 in the change in value of equity securities due to declines in the market value of community bank stocks owned by Juniata for the three months ended December 31, 2024 compared to the three months ended December 31, 2023.

Non-interest expense was $5.7 million for the three months ended December 31, 2024, compared to $5.0 million for the three months ended December 31, 2023, an increase of 13.7%. Most significantly impacting non-interest expense for the comparative three month periods was an increase of $212,000 in employee compensation expense, primarily due to an extra pay period in the 2024 period, as well as a $273,000 increase in employee benefits expense due to an increase in medical claims expenses. Also contributing to the increase in non-interest expense between comparative three month periods was an increase of $108,000 in occupancy expenses due to an increase in rental expense from the early termination of a branch office lease in December 2024, as well as increases of $80,000 in equipment expense and $90,000 in professional fees. These increases were partially offset by a decrease of $102,000 in other non-interest expense, primarily due to a decrease in the provision for unfunded commitments during the three months ended December 31, 2024 compared to the three months ended December 31, 2023.

An income tax provision of $212,000 was recorded for the three months ended December 31, 2024 compared to an income tax provision of $262,000 recorded for the three months ended December 31, 2023. The federal tax credit for investments in low-income housing partnerships was $82,000 in both the three months ended December 31, 2024 and 2023.

Financial Condition

Total assets as of December 31, 2024 were $848.9 million, a decrease of $21.7 million, or 2.5%, compared to total assets of $870.6 million at December 31, 2023. Comparing asset balances on December 31, 2024 and December 31, 2023, cash and cash equivalents and total debt securities decreased by $17.9 million and $12.0 million, respectively, while total loans increased by $8.5 million. As of December 31, 2024, short-term borrowings and repurchase agreements decreased by $10.6 million compared to December 31, 2023, and long-term debt decreased by $15.0 million over the same period due to the maturity of a 5-year FHLB advance in May 2024.

Juniata maintains a strong liquidity position as of December 31, 2024, with additional borrowing capacity with the Federal Home Loan Bank of Pittsburgh of $216.2 million and $51.1 million from the Federal Reserve’s Discount Window. In addition, Juniata has internal authorization for brokered deposits of up to $175.0 million. Juniata had no brokered deposits as of December 31, 2024.

Subsequent Event

On January 21, 2025, the Board of Directors declared a cash dividend of $0.22 per share to shareholders of record on February 14, 2025 payable on February 28, 2025.

Management considers subsequent events occurring after the statement of condition date for matters which may require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company’s consolidated financial statements with the Securities and Exchange Commission. Accordingly, the financial information in this release is subject to change.

The Juniata Valley Bank, the principal subsidiary of Juniata Valley Financial Corp., is headquartered in Mifflintown, Pennsylvania, with fifteen community offices located in Juniata, Mifflin, Perry, Franklin, McKean and Potter Counties. More information regarding Juniata Valley Financial Corp. and The Juniata Valley Bank can be found online at www.JVBonline.com. Juniata Valley Financial Corp. trades through the OTCQX Best Market under the symbol JUVF.

Forward-Looking Information
*This press release may contain “forward looking” information as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect the current views of Juniata’s management with respect to, among other things, future events and Juniata’s financial performance. When words such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” the negative variations of those words or similar expressions are used in this release, Juniata is making forward-looking statements. Such information is based on Juniata’s current expectations, estimates and projections about future events and financial trends affecting the financial condition of its business, many of which, by their nature, are inherently uncertain and beyond the control of Juniata. These statements are not historical facts or guarantees of future performance, events or results and are subject to risks, assumptions and uncertainties that are difficult to predict. If one or more events related to these or other risks or uncertainties materializes, or if underlying assumptions prove to be incorrect, actual results may differ materially from this forward-looking information. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and many factors could affect future financial results. Juniata undertakes no obligation to publicly update or revise forward looking information, whether because of new or updated information, future events, or otherwise. For a more complete discussion of certain risks and uncertainties affecting Juniata, please see the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Forward-Looking Statements” set forth in the Juniata’s filings with the Securities and Exchange Commission.

Financial Statements

Juniata Valley Financial Corp. and Subsidiary
Consolidated Statements of Financial Condition


(Dollars in thousands, except share data)	(Unaudited)
	December 31, 2024			December 31, 2023
ASSETS
Cash and due from banks	$	5,064		$	17,189
Interest bearing deposits with banks		5,934			11,741
Cash and cash equivalents		10,998			28,930

Equity securities		1,189			1,073
Debt securities available for sale		64,623			67,564
Debt securities held to maturity (fair value $182,773 and $198,147, respectively)		191,627			200,644
Restricted investment in bank stock		2,530			1,707
Total loans		533,869			525,394
Less: Allowance for credit losses		(6,183	)		(5,677	)
Total loans, net of allowance for credit losses		527,686			519,717
Premises and equipment, net		9,382			8,180
Bank owned life insurance and annuities		15,214			14,841
Investment in low income housing partnerships		832			1,154
Core deposit and other intangible assets		258			343
Goodwill		9,812			9,812
Mortgage servicing rights		69			83
Deferred tax asset		9,842			11,319
Accrued interest receivable and other assets		4,812			5,188
Total assets	$	848,874		$	870,555
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Deposits:
Non-interest bearing	$	196,801		$	197,027
Interest bearing		551,156			552,018
Total deposits		747,957			749,045

Short-term borrowings and repurchase agreements		42,242			52,810
Long-term debt		5,000			20,000
Other interest bearing liabilities		830			951
Accrued interest payable and other liabilities		5,388			7,612
Total liabilities		801,417			830,418
Commitments and contingent liabilities
Stockholders’ Equity:
Preferred stock, no par value: Authorized – 500,000 shares, none issued		—			—
Common stock, par value $1.00 per share: Authorized 20,000,000 shares; Issued – 5,151,279 shares at December 31, 2024 and December 31, 2023; Outstanding – 5,003,384 shares at December 31, 2024 and 4,991,129 shares at December 31, 2023		5,151			5,151
Surplus		24,896			24,924
Retained earnings		53,126			51,297
Accumulated other comprehensive loss		(33,320	)		(38,640	)
Cost of common stock in Treasury: 147,895 shares at December 31, 2024; 160,150 shares at December 31, 2023		(2,396	)		(2,595	)
Total stockholders’ equity		47,457			40,137
Total liabilities and stockholders’ equity	$	848,874		$	870,555

Juniata Valley Financial Corp. and Subsidiary
Consolidated Statements of Income (Unaudited)


	Three Months Ended					Year Ended
(Dollars in thousands, except share and per share data)	December 31,					December 31,
	2024		2023			2024		2023
Interest income:
Loans, including fees	$	7,885	$	7,159		$	31,109	$	26,728
Taxable securities		1,408		1,509			5,749		6,193
Tax-exempt securities		29		30			118		139
Other interest income		24		52			140		121
Total interest income		9,346		8,750			37,116		33,181
Interest expense:
Deposits		2,924		2,633			11,167		8,247
Short-term borrowings and repurchase agreements		568		419			2,719		1,733
Long-term debt		31		118			268		471
Other interest bearing liabilities		8		9			33		38
Total interest expense		3,531		3,179			14,187		10,489
Net interest income		5,815		5,571			22,929		22,692
Provision for credit losses		63		89			534		500
Net interest income after provision for credit losses		5,752		5,482			22,395		22,192
Non-interest income:
Customer service fees		467		358			1,767		1,376
Debit card fee income		450		477			1,752		1,770
Earnings on bank-owned life insurance and annuities		62		55			236		222
Trust fees		110		85			469		466
Commissions from sales of non-deposit products		79		82			388		337
Fees derived from loan activity		231		163			682		500
Change in value of equity securities		49		95			115		17
Gain from life insurance proceeds		56		—			56		161
Other non-interest income		101		113			360		472
Total non-interest income		1,605		1,428			5,825		5,321
Non-interest expense:
Employee compensation expense		2,333		2,121			9,022		8,454
Employee benefits		715		442			2,448		2,355
Occupancy		433		325			1,412		1,289
Equipment		246		166			863		659
Data processing expense		719		711			2,881		2,937
Professional fees		304		214			1,134		848
Taxes, other than income		37		26			191		184
FDIC Insurance premiums		140		152			575		504
Gain on other real estate owned		—		(16	)		—		(16	)
Amortization of intangible assets		21		25			85		81
Amortization of investment in low-income housing partnerships		80		80			322		353
Merger and acquisition expense		—		—			—		227
Other non-interest expense		626		728			2,079		2,072
Total non-interest expense		5,654		4,974			21,012		19,947
Income before income taxes		1,703		1,936			7,208		7,566
Income tax provision		212		262			979		970
Net income	$	1,491	$	1,674		$	6,229	$	6,596
Earnings per share
Basic	$	0.30	$	0.33		$	1.25	$	1.32
Diluted	$	0.30	$	0.33		$	1.24	$	1.31

The MIL Network –

January 30, 2025

Category: Taxation

National Conference on Good Governance Commences Tomorrow in GandhinagarChief Minister Shri Bhupendra Patel and Union Minister of State Dr. Jitendra Singh to Inaugurate the Two-Day Event

Updates to this page

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MEDIA RELATIONS

IMF Communications Department

MEDIA RELATIONS

National Conference on Good Governance Commences Tomorrow in Gandhinagar

Chief Minister Shri Bhupendra Patel and Union Minister of State Dr. Jitendra Singh to Inaugurate the Two-Day Event