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FIRST MID BANCSHARES, INC. (FMBH)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered record net income of $22.2M and GAAP diluted EPS of $0.93; adjusted EPS was $0.96, with tax-equivalent NIM expanding 19 bps sequentially to 3.60% as earning asset yields rose and funding costs fell .
  • EPS slightly beat Wall Street consensus (Primary EPS 0.96 vs 0.94*) and revenue materially exceeded expectations ($82.6M vs $58.2M*), driven by lower interest expense, NIM expansion, and resilient noninterest income mix (insurance record quarter) . Values retrieved from S&P Global.*
  • Loans grew 0.5% q/q to $5.70B and deposits rose 1.2% q/q to $6.13B, supporting margin expansion and lowering wholesale funding; TBVPS increased 4.4% in the quarter .
  • Asset quality remained strong: NPLs down to 0.47% of loans; ACL to NPLs at 263% despite $1.8M net charge-offs; special mention rose (largely watchlist), substandard decreased .
  • Board declared a $0.24 dividend; management highlighted disciplined credit culture and completed retail online platform conversion to improve cross-sell and efficiency—both potential positive catalysts for sentiment .

What Went Well and What Went Wrong

What Went Well

  • Record quarterly net income ($22.2M) and adjusted EPS ($0.96) with four consecutive quarters of net interest income growth; tax-equivalent NIM expanded to 3.60% (+19 bps q/q), aided by lower funding costs and higher earning asset yields .
  • Noninterest income resilience with an insurance record quarter; wealth management and insurance combined grew 8.2% YoY; Ag Services revenue $2.6M supported mix diversification .
  • Deposits increased $73.3M q/q (noninterest-bearing +$65.4M; time deposits +$75.4M), allowing $55.5M reduction in FHLB borrowings and subordinated debt, lowering overall funding costs .

Management quote: “We significantly expanded our net interest margin through both an increase in earning asset yields and a decrease in the average cost of funds... and completed our retail online system conversion” — Joe Dively, Chairman & CEO .

What Went Wrong

  • Wealth management revenue fell $0.5M q/q due to seasonal farmland sales; debit card fee income down $0.6M on softer consumer spending .
  • Special mention loans increased $16.2M q/q to $74.0M (watchlist elevation), though substandard declined and NPLs fell; provision expense $1.7M with net charge-offs $1.8M .
  • Noninterest expense still included ~$1.0M of nonrecurring tech project costs (down from $2.2M in Q4), keeping the adjusted efficiency ratio essentially flat at 58.9% q/q .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Net Interest Income ($USD Millions)$57.543 $58.950 $59.409
Noninterest Income ($USD Millions)$23.023 $26.363 $24.864
Total Revenue ($USD Millions)$80.566 $85.313 $84.273
GAAP Diluted EPS ($)$0.81 $0.80 $0.93
Adjusted Diluted EPS ($)$0.83 $0.87 $0.96
Tax-Equivalent NIM (%)3.35% 3.41% 3.60%
Efficiency Ratio (Adj., %)61.33% 59.51% 58.88%
ROA (%)1.03% 1.01% 1.19%

YoY comparison (Q1 2024 vs Q1 2025):

MetricQ1 2024Q1 2025YoY Δ
Net Interest Income ($USD Millions)$55.470 $59.409 +$3.939
Noninterest Income ($USD Millions)$24.478 $24.864 +$0.386
GAAP Diluted EPS ($)$0.86 $0.93 +$0.07
Tax-Equivalent NIM (%)3.25% 3.60% +35 bps

Noninterest income detail:

Component ($USD Millions)Q3 2024Q4 2024Q1 2025
Wealth Management Revenues$5.816 $6.275 $5.800
Insurance Commissions$6.003 $6.805 $9.925
ATM/Debit Card Revenue$4.267 $4.204 $3.646
Service Charges$3.121 $3.058 $2.901
Mortgage Banking Revenues$1.109 $1.104 $0.711
Other$2.984 $4.917 $2.062
Net Securities Gains/(Losses)$(0.277) $0.000 $(0.181)
Total Noninterest Income$23.023 $26.363 $24.864

Balance sheet and credit KPIs:

KPIQ3 2024Q4 2024Q1 2025
Loans ($USD Billions)$5.615 $5.672 $5.699
Deposits ($USD Billions)$6.089 $6.057 $6.130
NPLs / Total Loans (%)0.32% 0.53% 0.47%
ACL / Total Loans (%)1.22% 1.24% 1.23%
ACL / NPLs (%)377.01% 235.23% 263.36%
ROA (%)1.03% 1.01% 1.19%
TBVPS ($)$24.82 $24.46 $25.53
TBVPS ex-AOCI ($)$29.70 $30.42 $31.21

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per Share ($)Q2 2025 (payable 5/30/25)$0.24 (Q4 2024) $0.24 Maintained
Net Interest Margin MethodologyFrom Q1 2025Prior calculation (company-specific)Changed to “annualized tax-equivalent NII / avg interest earning assets”; +5 bps effect vs Q4 Methodology updated
Quantitative Outlook (Revenue/Margins/OpEx/Tax)2025None providedNone providedN/A

No formal quantitative revenue/margin/OpEx/tax guidance was issued; management emphasized disciplined credit culture and diversified revenue sources in a cautious macro environment .

Earnings Call Themes & Trends

No Q1 2025 earnings call transcript was available in the document catalog; management indicated an investor presentation would be published alongside the press release, but a transcript was not found in our search window .

TopicPrevious Mentions (Q3 2024, Q4 2024)Current Period (Q1 2025)Trend
Technology initiativesQ3: Integration costs; license costs up . Q4: $2.2M nonrecurring tech expenses; multiple strategic investments completed .$1.0M nonrecurring tech expenses; retail online platform conversion completed .Execution progressing; lower one-time expense q/q.
Funding costs & depositsQ3: Brokered CDs repaid; cost of funds up to 2.00% . Q4: Cost of funds down to 1.83% .Cost of funds 1.74%; deposits +1.2% q/q; added $52M brokered as rates declined .Improving cost and mix; opportunistic wholesale usage.
Net interest marginQ3: 3.35% (flat) . Q4: 3.41% (+6 bps) .3.60% (+19 bps); methodology aligned to peers (+5 bps effect) .Strong sequential expansion.
Asset qualityQ3: NPLs 0.32%; ACL/NPL 377% . Q4: NPLs 0.53%; single borrower impact; ACL/NPL 235% .NPLs 0.47%; ACL/NPL 263%; special mention up, substandard down .Stabilizing after single-borrower event.
Insurance & wealthQ3: Insurance down seasonally; WM up . Q4: WM +$0.5M; Insurance +13% q/q .Insurance record quarter; WM down seasonally .Insurance momentum; WM seasonal normalization.
Ag ServicesQ3: $1.8M farm management; AUM $6.4B . Q4: Record farmland sales [$3.0M Ag revenue] .$2.6M revenue; farmland seasonality impacted WM .Solid contribution; seasonal volatility persists.
Capital & TBVQ3: TBVPS +6.6% . Q4: Capital ratios strong; leverage 10.33% .TBVPS +4.4%; CET1 12.73%; leverage 10.73% .Capital robust; TBVPS rising.

Management Commentary

  • “We kicked off 2025 with a record high quarterly net income that reflects our strategic focus on driving a higher return on assets… we significantly expanded our net interest margin through both an increase in earning asset yields and a decrease in the average cost of funds.” — Joe Dively, Chairman & CEO .
  • “We successfully completed our retail online system conversion during the quarter providing a better overall product for our customers and an improved platform to grow relationships across business lines.” — Joe Dively .
  • “We are well-prepared with a disciplined credit culture and diversified revenue sources that position us to weather economic disruptions.” — Joe Dively .

Q&A Highlights

  • No Q1 2025 earnings call transcript was available in our source set; as such, Q&A themes and any guidance clarifications could not be assessed. Management indicated an investor presentation would accompany the release .

Estimates Context

MetricConsensus (Q1 2025)Actual (Q1 2025)Surprise
Primary EPS ($)0.94*0.96*+0.02 (beat)*
Revenue ($USD Millions)$58.22*$82.62*+$24.40 (beat)*

Values retrieved from S&P Global.*

Implications: EPS beat is modest; revenue beat is significant relative to bank “revenue” constructs and aligns with press release drivers (lower interest expense, NIM expansion, insurance strength, offset by lower accretion and seasonal WM decline) .

Key Takeaways for Investors

  • Margin inflection: Tax-equivalent NIM expanded to 3.60% (+19 bps q/q; +35 bps YoY) with cost of funds down to 1.74%—a durable driver if deposit mix improvements and rate backdrop persist .
  • Balanced growth: Loans +0.5% q/q and deposits +1.2% q/q, enabling $55.5M debt reduction and lower funding costs—supportive for continued NII growth .
  • Noninterest mix resilience: Insurance posted record revenue; Ag Services steady; expect WM seasonality to normalize in coming quarters .
  • Asset quality strong despite watchlist uptick: NPL ratio 0.47%; ACL/NPL 263%—single-borrower issues from Q4 receding; monitor special mention trajectory .
  • Capital and TBVPS momentum: CET1 12.73%, leverage 10.73%; TBVPS +4.4% q/q supports valuation and dividend capacity .
  • Short-term trading: Results and beats should be viewed favorably; note methodology change added ~5 bps to NIM—investors should adjust peer comparisons accordingly .
  • Medium-term thesis: Ongoing tech investments, diversified fee streams, and disciplined funding should sustain ROA >1% and efficiency improvements; watch deposit competition, consumer spending impact on interchange, and special mention migration .