Franklin Financial Reports First Quarter 2025 Results; Declares Dividend

Published: 2025-04-29 08:31:15 ET FRAF

CHAMBERSBURG, Pa., April 29, 2025 /PRNewswire/ -- Franklin Financial Services Corporation (the Corporation) (NASDAQ: FRAF), the bank holding company of F&M Trust (the Bank) headquartered in Chambersburg, PA, reported its first quarter 2025 financial results. A summary of notable operating results as of or for the quarter ended March 31, 2025 follows:

Balance Sheet Highlights

Total assets at March 31, 2025 were $2.257 billion, up 2.7% from $2.198 billion at December 31, 2024. Significant changes in the balance sheet from December 31, 2024 to March 31, 2025 include:

Income Statement Highlights

"Our first quarter results are showing that the work we did in 2023 and 2024, developing the necessary infrastructure to support the strategic growth of the Corporation, and then building loan and deposit balances, growing wealth management assets under management and positioning the balance sheet for success, are showing in the improved financial performance of the Corporation," said Tim Henry, CEO. "We are pleased to be able to post strong first quarter results as we continue to work to improve our efficiency and profitability across all areas of the Bank."

"I retire on May 2nd so this will be my last quarter at the Corporation. Over the last three months I have had the pleasure to work side by side with Craig Best, our President and incoming CEO, and I am excited for what the Corporation will accomplish going forward under Craig's seasoned leadership."

(1) NonGAAP measure. See GAAP versus NonGAAP Presentation that follows.

Additional information on the Corporation is available on our website at: www.franklinfin.com/Presentations.

Franklin Financial is the largest independent, locally owned and operated bank holding company headquartered in Franklin County with assets of more than $2.3 billion. Its wholly-owned subsidiary, F&M Trust, has twenty-three community banking locations in Franklin, Cumberland, Dauphin, Fulton and Huntingdon Counties PA, and Washington County MD. Franklin Financial stock is trading on the Nasdaq Stock Market under the symbol FRAF. Please visit our website for more information, www.franklinfin.com.

Management considers subsequent events occurring after the balance sheet 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 when filed with the Securities and Exchange Commission ("SEC''). Accordingly, the financial information in this announcement is subject to change.

Certain statements appearing herein which are not historical in nature are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of I995. Such forward-looking statements refer to a future period or periods, reflecting management's current views as to likely future developments, and use words "may," "will," "expect," "believe," "estimate," "anticipate," or similar terms. Because forward-looking statements involve certain risks, uncertainties and other factors over which Franklin Financial Services Corporation has no direct control, actual results could differ materially from those contemplated in such statements. These factors include (but are not limited to) the following: changes in interest rates, changes in the rate of inflation, general economic conditions and their effect on the Corporation and our customers, changes in the Corporation's cost of funds, changes in government monetary policy, changes in government regulation and taxation of financial institutions, changes in technology, the intensification of competition within the Corporation's market area, and other similar factors.

We caution readers not to place undue reliance on these forward-looking statements. They only reflect management's analysis as of this date. The Corporation does not revise or update these forward-looking statements to reflect events or changed circumstances. Please carefully review the risk factors described in other documents the Corporation files from time to time with the SEC, including the Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and any Current Reports on Form 8-K.

FRANKLIN FINANCIAL SERVICES CORPORATION

Financial Highlights (Unaudited)

Earnings Summary

For the Three Months Ended

(Dollars in thousands, except per share data)

3/31/2025

12/31/2024

3/31/2024

Interest income

27,058

26,856

23,809

Interest expense

11,452

11,760

10,256

Net interest income

15,606

15,096

13,553

Provision for credit losses - loans

750

451

490

Provision for (reversal of) credit losses - unfunded commitments

(38)

Total provision for credit losses

779

500

452

Noninterest income

4,562

288

4,188

Noninterest expense

14,577

14,335

13,284

Income before income taxes

4,812

549

4,005

Income taxes

890

644

Net income

3,922

487

3,361

Diluted earnings per share

0.88

0.11

0.77

Regular cash dividends declared

0.32

Balance Sheet Highlights (as of )

3/31/2025

12/31/2024

3/31/2024

Total assets

2,257,478

2,197,841

2,011,614

Debt securities available for sale

495,487

508,604

462,951

Loans, net

1,437,747

1,380,424

1,261,062

Deposits

1,867,577

1,815,647

1,559,312

Other borrowings

200,000

280,000

Shareholders' equity

151,391

144,716

134,237

Assets Under Management (fair value)

Wealth Management

1,183,180

1,169,282

1,107,611

Held at third party brokers

139,918

139,872

151,465

Total assets under management

1,323,098

1,309,154

1,259,076

As of or for the Three Months Ended

Performance Ratios

3/31/2025

12/31/2024

3/31/2024

Return on average assets*

0.72 %

0.09 %

0.67 %

Return on average equity*

10.80 %

1.32 %

10.21 %

Dividend payout ratio

36.16 %

290.14 %

41.62 %

Net interest margin*

3.05 %

2.92 %

2.88 %

Net loans recovered (charged-off)/average loans*

0.01 %

-0.02 %

0.00 %

Nonperforming loans / gross loans

0.02 %

0.04 %

Nonperforming assets / total assets

0.01 %

0.02 %

Allowance for credit losses / loans

1.27 %

1.26 %

1.29 %

Book value, per share

33.99

32.69

30.55

Tangible book value (1)

31.97

30.65

28.50

Market value, per share

35.45

29.90

26.20

Market value/book value ratio

104.30 %

91.47 %

85.76 %

Market value/tangible book value ratio

110.90 %

97.54 %

91.94 %

Price/earnings multiple*

10.07

67.95

8.51

Current quarter dividend yield*

3.61 %

4.28 %

4.89 %

* Annualized

(1) Non-GAAP measurement. See GAAP versus Non-GAAP disclosure

GAAP versus non-GAAP Presentations – The Corporation supplements its traditional GAAP measurements with certain non-GAAP measurements to evaluate its performance and to eliminate the effect of intangible assets.  By eliminating intangible assets (Goodwill), the Corporation believes it presents a measurement that is comparable to companies that have no intangible assets or to companies that have eliminated intangible assets in similar calculations. However, not all companies may use the same calculation method for each measurement. The non-GAAP measurements are not intended to be used as a substitute for the related GAAP measurements. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP.  In the event of such a disclosure or release, the Securities and Exchange Commission's Regulation G requires: (i) the presentation of the most directly comparable financial measure calculated and presented in accordance with GAAP and (ii) a reconciliation of the differences between the non-GAAP financial measure presented and the most directly comparable financial measure calculated and presented in accordance with GAAP. The following table shows the calculation of the non-GAAP measurements.

Non-GAAP

(Dollars in thousands, except per share)

As of

March 31, 2025

December 31, 2024

March 31, 2024

Tangible Book Value (per share) (non-GAAP)

Shareholders' equity

151,391

144,716

134,237

Less intangible assets

(9,016)

Tangible book value (non-GAAP)

142,375

135,700

125,221

Shares outstanding (in thousands)

4,454

4,427

4,394

Tangible book value per share (non-GAAP)

31.97

30.65

28.50

Three Months

Ended

Summary Results Excluding Securities Losses (non-GAAP)

12/31/24

Securities losses as reported

(4,267)

Securities losses as reported, net of tax benefit (21%) (non-GAAP)

(3,371)

Noninterest income as reported

288

Plus securities losses

4,267

Noninterest income excluding securities losses (non-GAAP)

4,555

Net income as reported

487

Plus securities losses, net of tax benefit

3,371

Net income excluding securities losses net of tax benefit (non-GAAP)

3,858

View original content to download multimedia:https://www.prnewswire.com/news-releases/franklin-financial-reports-first-quarter-2025-results-declares-dividend-302440420.html

SOURCE Franklin Financial Services Corporation