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OLD POINT FINANCIAL CORP (OPOF)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered net income of $2.2M and diluted EPS of $0.42, down sequentially from $0.57 in Q4 2024 on higher credit loss provisioning and merger-related costs, but up year over year from $0.34 on stronger NIM and noninterest income .
  • Net interest margin improved to 3.64% (FTE), a 11 bps sequential and 18 bps year-over-year increase, supported by lower costs on deposits and a favorable shift away from time deposits; net interest income declined 2.0% sequentially to $12.0M but rose 4.1% year over year .
  • Noninterest income rose to $3.8M, aided by a $0.656M gain on redemption and retirement of a subordinated note; provision for credit losses increased to $0.717M, reflecting a specific reserve build and higher past due exposures, while NPAs rose to 0.29% of assets but remain low in absolute terms .
  • Strategic catalyst: TowneBank announced a definitive agreement to acquire Old Point (cash or stock election: $41.00 cash or 1.1400 TOWN shares per OPOF share; expected close in 2H25), positioning OPOF shareholders for near-term value realization and integration synergies .

What Went Well and What Went Wrong

What Went Well

  • NIM expansion: FTE NIM increased to 3.64% (vs. 3.53% in Q4 2024 and 3.46% in Q1 2024), driven by lower liability costs and deposit mix improvements away from time deposits; management highlighted lower rates on money market and time deposits as drivers .
  • Noninterest income strength: Total noninterest income rose to $3.8M, with a notable $0.656M gain from subordinated note redemption and higher fiduciary and asset management fees .
  • Capital and liquidity: Equity increased $3.2M quarter-over-quarter to $117.2M; liquidity remained robust at $456.5M (31.5% of assets), supporting resilience amid merger execution .
  • Management tone: “Building off our record earnings in 2024, we had a strong first quarter from an operating perspective,” with revenues, deposits, total assets, and NIM all up year over year; CEO expressed confidence in TowneBank merger benefits .

What Went Wrong

  • Higher credit provisioning and asset quality metrics: Provision rose to $0.717M (vs. $0.090M in Q4 2024), ACL/loans increased to 1.17%, and NPAs/total assets rose to 0.29% (from 0.19% in Q4 2024), mainly due to one relationship moving into >90 days past due and increased repossessed assets .
  • Sequential earnings decline: EPS fell to $0.42 from $0.57, impacted by higher provision and merger-related costs; net interest income declined $0.244M sequentially due to lower average loan balances .
  • Deposit costs remain a headwind despite progress: While overall costs declined, the rate environment still pressured funding costs versus year-ago levels; management noted uncertainty regarding future rate impacts on NIM .

Financial Results

MetricQ1 2024Q3 2024Q4 2024Q1 2025
Total revenue (FTE) ($USD Millions)$14.799 $15.819 $15.533 $15.891
Net interest income ($USD Millions)$11.540 $12.310 $12.252 $12.008
Diluted EPS ($USD)$0.34 $0.47 $0.57 $0.42
NIM (FTE) (%)3.46% 3.57% 3.53% 3.64%
Efficiency ratio (FTE) (%)85.83% 78.35% 77.82% 78.32%
ROA (%)0.48% 0.64% 0.77% 0.61%
ROE (%)6.44% 8.39% 9.96% 7.50%
Consensus vs. ActualQ1 2025
EPS Consensus (S&P Global)Unavailable via S&P Global (CIQ mapping missing)
EPS Actual$0.42
Revenue Consensus (S&P Global)Unavailable via S&P Global (CIQ mapping missing)
Revenue Actual (FTE)$15.891M
Note: S&P Global consensus values unavailable due to missing CIQ mapping in our data pipeline; results could not be retrieved via GetEstimates.
Noninterest Income Breakdown ($USD Thousands)Q1 2024Q4 2024Q1 2025
Fiduciary and asset management fees1,192 1,212 1,332
Service charges on deposit accounts758 798 770
Other service charges, commissions and fees883 904 943
Bank-owned life insurance income265 274 282
Loss on sale of AFS securities, net——(176)
(Loss) gain on sale of repossessed assets, net22 (65) (84)
Gain on redemption and retirement of subordinated notes——656
Other operating income102 121 124
Total noninterest income3,222 3,244 3,847
KPIsQ1 2024Q4 2024Q1 2025
Deposits ($USD Millions)$1,228.269 $1,254.914 $1,257.478
Loans, net ($USD Millions)$1,055.955 $998.713 $1,001.009
Total assets ($USD Millions)$1,445.489 $1,450.570 $1,450.988
Book value per share ($)$21.35 $22.44 $22.96
Tangible book value per share ($)$20.99 $22.09 $22.61
NPAs / Total assets (%)0.15% 0.19% 0.29%
NPAs ($USD Millions)$2.152 $2.695 $4.147
Loans >90 days past due, accruing ($USD Millions)$0.878 $0.641 $1.884
ACL on loans / total loans (%)1.12% 1.13% 1.17%
Annualized net charge-offs / avg loans (%)0.12% 0.16% 0.14%
Tier 1 capital ratio (Bank) (%)—12.97% 13.04%
Leverage ratio (Bank) (%)—10.06% 10.45%
Liquidity ($USD Millions; % of assets)—$460.0; 31.7% $456.5; 31.5%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Dividend per shareQ1 2025$0.14 (Q4 2024 declared) $0.14 declared; payable Mar 28, 2025 Maintained
Merger timeline2H 2025N/AExpected close in 2H25 (subject to approvals) New (announced)
Revenue/Margins/OpEx/Tax/Segment guidanceQ2–FY2025None providedNone providedMaintained (no formal guidance)

Earnings Call Themes & Trends

Note: A Q1 2025 earnings call transcript could not be located in our document catalog; trends are derived from company releases.

TopicPrevious Mentions (Q3 2024)Previous Mentions (Q4 2024)Current Period (Q1 2025)Trend
Cost reduction initiativesOne-time costs of $0.997M incurred; ~$5.0M annualized pre-tax expense savings targeted Headcount reduced ~12%; noninterest expense down Y/Y Noninterest expense down vs PY; merger-related costs incurred Sustained cost discipline; merger costs now appearing
Net interest margin (FTE)3.57% 3.53% 3.64% Improving
Deposit mix and growthDeposits up 4.3% YTD; increases across categories Deposits up 2.0% Y/Y Noninterest-bearing +4.4%; savings +4.5%; time deposits −17.9% Mix shift to lower-cost deposits
Asset qualityNPAs 0.18% of assets NPAs 0.19% of assets NPAs 0.29% of assets; >90 days accruing rose to $1.9M Worsening, but still low absolute levels
Capital ratios—Tier 1 12.97%; leverage 10.06% Tier 1 13.04%; leverage 10.45% Strengthening
Strategic M&A——Definitive agreement to merge with TowneBank; $41 cash or 1.1400 TOWN shares per OPOF share New strategic catalyst

Management Commentary

  • “Building off our record earnings in 2024, we had a strong first quarter from an operating perspective, with revenues, deposits, total assets, and net interest margin all increasing compared to the first quarter of 2024.” — Robert F. Shuford, Jr., Chairman, President & CEO .
  • “We are excited about our future partnership [with TowneBank] … We believe this partnership will provide the combined company with a stronger platform for growth and create enhanced value for our shareholders, customers and employees.” — Robert F. Shuford, Jr. .
  • Prior quarter tone: “Despite a challenging banking environment, we delivered record earnings in 2024 … cost-saving measures … along with our strategic growth plan will allow us to capitalize on new opportunities.” — Robert F. Shuford, Jr. .

Q&A Highlights

  • A Q1 2025 earnings call transcript was not found in the document catalog; no Q&A themes are available to report at this time [ListDocuments returned none for earnings-call-transcript].

Estimates Context

  • S&P Global consensus estimates for EPS and revenue could not be retrieved due to a missing Capital IQ mapping for OPOF in our pipeline; thus, no beat/miss determination versus Wall Street consensus is available for Q1 2025. Values would otherwise be retrieved from S&P Global but are unavailable in this instance.
  • External sell-side context indicates 2025 estimates were suspended by at least one coverage source due to the pending TowneBank merger, aligning with limited consensus visibility (for reference only) .

Key Takeaways for Investors

  • NIM momentum and deposit mix improvement are supportive of core earnings quality despite sequential net interest income headwinds; watch for further liability cost normalization and loan balance trends .
  • Asset quality metrics ticked up (NPAs/TA to 0.29%; >90 day accruing to $1.9M), prompting higher provisioning; monitoring the specific construction/land development relationship and repossessed asset resolutions is prudent .
  • Noninterest income levers (wealth fees, debt extinguishment gains) provided tangible upside; durability of fees vs. one-time gains will be a focus in upcoming quarters .
  • Capital and liquidity remain solid, with Tier 1 improving and liquidity >31% of assets, enhancing flexibility through the merger process .
  • Dividend maintained at $0.14/share, signaling stable capital return amid M&A execution .
  • Near-term stock narrative is merger-driven: $41 cash or 1.1400 TOWN shares election provides a defined value path; execution risk centers on regulatory approvals, integration cost and timing .
  • Post-close, portfolio managers should reassess the thesis under TowneBank’s combined platform, focusing on synergy realization, credit provisioning for acquired portfolios, and deposit franchise strength across markets .