Sign in

You're signed outSign in or to get full access.

FC

FIRST COMMUNITY BANKSHARES INC /VA/ (FCBC)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered solid results with adjusted diluted EPS of $0.70 and revenue of ~$42.19M, both above Wall Street (S&P Global) consensus of $0.63 EPS and $40.40M revenue; GAAP diluted EPS was $0.67 and net income was $12.27M . Revenue beat was driven by stable net interest income and higher noninterest income (service charges +23% YoY; wealth management +28% YoY) despite lower average loans . EPS and revenue estimates from S&P Global.*
  • Net interest margin (FTE) held at 4.43% (+2 bps YoY) even as average loan balances declined; lower deposit interest expense and time deposit balances offset earning-asset yield pressure .
  • Credit quality improved: NPLs/loans fell to 0.71% (from 0.82% YoY), NPAs declined to $16.90M; ACL/loans at 1.36% and annualized net charge-offs at 0.24% .
  • Noninterest expense rose 8.7% YoY on higher salaries/benefits and $0.787M merger expense tied to the announced Hometown Bank merger (target completion January 2026) .
  • Dividend maintained at $0.31/share (40th consecutive year of regular dividends), payable November 28, 2025 to holders of record November 14, 2025 .

What Went Well and What Went Wrong

  • What Went Well
    • Sustained margin strength: “Net interest margin…remained strong at 4.43% and was an increase of 2 basis points over the same quarter of 2024” .
    • Fee income growth: Service charges on deposits +23.46% YoY and wealth management fees +28.01% YoY supported total noninterest income growth of +4.18% YoY .
    • Asset quality improvement: Non-performing loans to total loans down to 0.71% (−11 bps YoY); NPAs fell to $16.90M with a continued declining trend since year-end 2024 .
  • What Went Wrong
    • Volume pressure: Average loans decreased by $116.18M (−4.73% YoY), reducing loan interest income by $1.30M (−4.05%) as earning-asset yield slipped 10 bps YoY .
    • Expense growth: Noninterest expense +8.69% YoY on higher salaries/benefits (+9.31%), service fees (+10.86%), and $0.787M merger expense, pressuring operating leverage .
    • Net charge-offs ticked up YoY: 0.24% annualized vs. 0.18% a year ago, though still modest and within risk tolerance; ACL ratio edged down to 1.36% from 1.44% at YE’24 .

Financial Results

  • P&L trends by quarter (GAAP)
Metric ($000s except per share)Q3 2024Q1 2025Q2 2025Q3 2025
Net Interest Income31,594 30,298 30,657 31,297
Provision for Credit Losses1,360 321 (285) 0
Noninterest Income10,452 10,229 10,340 10,889
Noninterest Expense24,177 24,944 25,455 26,279
Net Income13,033 11,818 12,246 12,266
Diluted EPS ($)0.71 0.64 0.67 0.67
Adjusted Diluted EPS ($)0.68 0.64 0.67 0.70
  • Estimates vs. Actuals (S&P Global)
MetricQ3 2025 ConsensusQ3 2025 Actual
EPS (Primary)$0.63*$0.70*
Revenue ($M)$40.40*$42.19*

Values with asterisks retrieved from S&P Global.

  • Revenue components (to reconcile revenue dynamics)
Component ($000s)Q3 2024Q1 2025Q2 2025Q3 2025
Net Interest Income31,594 30,298 30,657 31,297
Noninterest Income10,452 10,229 10,340 10,889
  • Key ratios and margins
MetricQ3 2024Q1 2025Q2 2025Q3 2025
Net Interest Margin (FTE)4.41% 4.34% 4.37% 4.43%
ROA (Annualized)1.60% 1.49% 1.53% 1.53%
ROE (Annualized)10.04% 9.49% 9.84% 9.58%
Adjusted ROATCE14.12% 13.79% 14.32% 14.53%
  • Credit quality and balance sheet KPIs
MetricQ3 2024Q1 2025Q2 2025Q3 2025
Loans HFI (EOP, $000s)2,444,113 2,382,699 2,353,277 2,331,305
Deposits (EOP, $000s)2,659,253 2,684,477 2,635,364 2,630,593
Cash & Equivalents (EOP, $000s)315,338 414,682 395,057 427,705
Book Value/Share ($)28.47 27.09 27.46 27.89
Tangible BV/Share ($)19.86 18.55 18.95 19.40
NPLs/Total Loans0.82% 0.85% 0.79% 0.71%
NPAs (Total, $000s)20,276 20,514 19,107 16,903
ACL/Total Loans1.44% 1.42% 1.40% 1.36%
Net Charge-offs (Ann.)0.18% 0.24% 0.08% 0.24%

Guidance Changes

  • The company did not provide formal quantitative forward guidance; dividend policy reiterated.
MetricPeriodPrevious GuidanceCurrent GuidanceChange
Quarterly Dividend/ShareQ4 2025 payment$0.31 $0.31 (record 11/14; pay 11/28) Maintained
Merger Timeline (Hometown Bank)TimingAnnounced July 2025 “Anticipated completion date of January 2026” Reiterated timing

Earnings Call Themes & Trends

Note: An earnings call transcript for Q3 2025 was not available in our sources; trends below synthesize quarterly press releases.

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
Net Interest MarginQ1: 4.34%; Q2: 4.37% with lower asset yields partly offset by lower funding costs NIM (FTE) 4.43%, +2 bps YoY; funding cost relief from lower time deposits Stable to improving
Loan Growth/BalanceQ1 & Q2: Average loans down vs. 2024; pressure on loan interest income Average loans −$116M YoY; loan interest income −$1.30M YoY Continued volume pressure
Fees & Wealth MgmtQ1: Noninterest income +10% YoY; service charges +16% Service charges +23% YoY; wealth mgmt +28% YoY Strengthening
Credit QualityQ1: NPLs/loans 0.85%; NPAs $20.51M NPLs/loans 0.71%; NPAs $16.90M Improving
Operating ExpensesQ1–Q2: Salaries/benefits rising; advertising up Noninterest expense +8.7% YoY; $0.787M merger expense Expense pressure (merger, comp)
Capital/Shareholder ReturnsQ2: $0.31 dividend; 50,338 shares repurchased $0.31 dividend declared; no Q3 repurchases Dividend steady; buybacks paused

Management Commentary

  • Prepared remarks (press release highlights):
    • “Net interest margin for the third quarter of 2025 remained strong at 4.43% and was an increase of 2 basis points over the same quarter of 2024” .
    • “Noninterest income increased…4.18%…attributable to an increase in service charges on deposits…23.46% [and] wealth management fees…28.01%” .
    • “Merger expense of $787 thousand…related to the forthcoming merger with Hometown Bank, with an anticipated completion date of January 2026” .

Q&A Highlights

  • No Q3 2025 earnings call transcript was available across our document set or public sources; therefore, no Q&A themes or clarifications could be verified.

Estimates Context

  • S&P Global consensus for Q3 2025 was $0.63 EPS and $40.40M revenue; FCBC delivered $0.70 EPS and $42.19M revenue, representing beats of $0.07 and ~$1.79M, respectively.*
  • Only one covering estimate was recorded for each metric for the quarter (EPS and revenue).*
  • Given the beats and improved fee momentum, street models may modestly lift near-term EPS on revenue mix (higher fees) and stable NIM, offset by continued expense inflation and lower average loans.*

Values marked with asterisks retrieved from S&P Global.

Key Takeaways for Investors

  • Earnings quality solid: Adjusted EPS beat alongside NIM resilience and broad-based noninterest income growth, suggesting core profitability remains intact despite lower loan volumes .
  • Fee franchise momentum: Deposit service charges and wealth management fees are growing double-digits YoY, diversifying revenue beyond spread income .
  • Credit normalizing positively: NPL/loans and NPAs declined with ACL coverage still robust; net charge-offs remain manageable .
  • Operating costs rising: Wage inflation and merger costs pressured noninterest expense; monitor integration timeline and run-rate expense post close .
  • Capital return steady: Dividend maintained at $0.31/share (40-year streak); buybacks paused in Q3; book value and tangible book continued to rebuild post special dividend .
  • Near-term stock catalyst: The EPS and revenue beats vs. S&P Global consensus may support sentiment; watch for color on 2026 merger synergies and expense trajectory at future disclosures.*

Appendix: Additional Detail

  • Income statement detail (Q3 2025): Total interest income $35.699M; total interest expense $4.402M; net interest income $31.297M; noninterest income $10.889M; noninterest expense $26.279M; net income $12.266M .
  • NIM FTE bridge points: Loan yields dipped slightly YoY; time deposit balances and costs fell; combined to lift spread and NIM marginally .
  • Non-GAAP adjustments: $0.787M merger expense; adjusted net income $12.901M; adjusted diluted EPS $0.70 .