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SEACOAST BANKING CORP OF FLORIDA (SBCF)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered healthy core trends: net interest margin expanded 9 bps to 3.48%, cost of deposits fell 15 bps to 1.93%, loans grew 5.6% annualized and deposits 11% annualized; GAAP diluted EPS was $0.37 and adjusted EPS $0.38 .
  • Against S&P Global consensus, SBCF posted a slight miss: Primary EPS $0.38 vs $0.395 est. (–4%) and Revenue $134.4m vs $137.9m est. (–3.4%). Management guided to continued net interest income growth, Q2 noninterest income of $20–$22m, and Q2 adjusted expenses of $87–$89m .
  • Asset quality remained solid: NPL ratio improved to 0.68% (from 0.90% in Q4), ACL held at 1.34%; provision rose to $9.3m reflecting loan growth and macro volatility .
  • Strategic positioning strengthened: pre-purchased $412m in AFS securities (5.7% TEY) ahead of Heartland acquisition expected to close in Q3; noninterest-bearing DDA grew 17% annualized and customer transaction accounts held at 50% of deposits .

What Went Well and What Went Wrong

  • What Went Well

    • Margin and funding: NIM +9 bps to 3.48% and cost of deposits –15 bps to 1.93%, supported by granular franchise and proactive pricing .
    • Core growth: Loans +5.6% annualized; deposits +11% annualized with noninterest-bearing deposits +17% annualized; late-stage loan pipeline increased 40%+ q/q .
    • Management tone: “We’ve built one of the strongest balance sheets…granular highly valuable deposit franchise. This fortress balance sheet provides…optionality and durability.” – CEO Charles Shaffer .

  • What Went Wrong

    • Estimates: Slight miss vs S&P Global consensus on EPS and revenue in Q1 2025, driven by lower accretion and seasonal noninterest income normalization post Q4 one-offs (SBIC, loan sales)* .
    • Provision/credit optics: Provision for credit losses increased to $9.3m (from $3.7m), reflecting growth and macro volatility; criticized/classified loans ticked up to 2.41% of loans, though management cited idiosyncratic items .
    • Expenses seasonality: Efficiency ratio worsened to 60.28% (from 56.26%) on higher seasonal payroll taxes/401(k) and growth investments; adjusted expense also up sequentially .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Net Revenues ($m)$130.3 $132.9 $140.7
Net Interest Income ($m)$106.7 $115.8 $118.5
Noninterest Income ($m)$23.7 $17.1 $22.2
Diluted EPS (GAAP)$0.36 $0.40 $0.37
Adjusted EPS$0.36 $0.48 $0.38
Net Interest Margin (%)3.17% 3.39% 3.48%
Cost of Deposits (%)2.34% 2.08% 1.93%
Loans, EOP ($m)$10,205.3 $10,300.0 $10,443.0
Deposits, EOP ($m)$12,243.6 $12,242.4 $12,574.8

Key KPIs and Credit Metrics

KPIQ3 2024Q4 2024Q1 2025
Loan Growth (annualized)+6.6% +3.7% +5.6%
Deposit Growth (annualized)+4.2% ~flat +11.0%
NPLs / Loans (%)0.79% 0.90% 0.68%
ACL / Loans (%)1.38% 1.34% 1.34%
Net Charge-offs ($m)$7.45 $6.11 $7.04
NCOs / Avg Loans (%)0.29% 0.24% 0.27%
Loan Pipeline, EOP ($m)$831.1 $693.3 $981.6

Estimates vs Actuals (S&P Global)

MetricQ3 2024Q4 2024Q1 2025
EPS Consensus Mean*$0.357$0.338$0.395
EPS Actual (S&P Primary EPS)*$0.36$0.48$0.38
Revenue Consensus Mean* ($m)$129.20$131.51$137.87
Revenue Actual (S&P)* ($m)$124.07$129.17$134.45

Values retrieved from S&P Global.*

Context: Company-reported net revenues were $140.7m in Q1 (FTE/definition differences explain variance to S&P “Revenue”) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Interest Income2025 (directional)—“Expect NII to continue to grow through the remainder of the year.” New qualitative guide
Noninterest IncomeQ2 2025—$20–$22m New range
Adjusted ExpensesQ2 2025—$87–$89m (ex-merger costs) New range
Loan GrowthNext Q and FY 2025Prior commentary: high-single-digit back-half (1Q guide referenced) Mid- to high-single-digit next quarter and for FY 2025 (tariffs a watch item) Maintained/clarified
Deposit GrowthFY 2025—Low- to mid-single-digit; seasonal Q2 outflow after tax payments New qualitative guide
Core NIM (ex-accretion)Q4 2025Prior target ~3.35% by YE (market dependent) Trajectory positive; timing/Heartland close could affect; more rate cuts could lift above 3.35% Maintained tone
DividendOngoing$0.18/qtr$0.18 declared (payable 6/30/25) Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 & Q4 2024)Current (Q1 2025)Trend
Margin trajectory & deposit costsQ3: NIM ex-accretion +3 bps, CoD +3 bps ; Q4: NIM +22 bps, CoD –26 bps NIM +9 bps to 3.48%; CoD –15 bps to 1.93%; further NII growth expected Improving
Loan/deposit growthQ3: Loans +6.6% ann., deposits +4.2% ann. ; Q4: Loans +3.7% ann., deposits flat Loans +5.6% ann., deposits +11% ann.; NIB DDA +17% ann. Strengthening
Tariffs/macro—; Q4 emphasized cost saves, deposit franchise Tariffs a watch item; clients pre-buy/inventory, pass-throughs; too early to tell Emerging risk, monitored
Credit qualityQ3/Q4 NPL ratio rose to 0.79%/0.90% but collateral solid NPL ratio improved to 0.68%; criticized/classified uptick idiosyncratic; ACL stable Stable to better
M&A/HeartlandQ3: AFS reposition later recognized in Q4 ; Q4: loss to reposition, reinvest at 5.4% Pre-purchased $412m at 5.7% TEY; expect Q3 close; low-risk structure Executing
Wealth/AUMQ3: AUM ~$2.0b; +26% YoY AUM +14% YoY; +$117m new AUM in Q1 Growing
Capital deploymentQ4: Fortress capital, TCE 9.6% Open to M&A; buybacks attractive post-Heartland blackout Optionality maintained

Management Commentary

  • “We’ve built one of the strongest balance sheets in the country…granular highly valuable deposit franchise…fortress balance sheet provides…optionality and durability.” – Charles Shaffer, CEO .
  • “Given the strong growth momentum…we expect net interest income to continue to grow through the remainder of the year.” – Tracey Dexter, CFO .
  • On pre-purchasing securities for Heartland: “Unique opportunity…we just pre-purchased the securities that we would want to retain…could move in our favor if rates are lower at close.” – Michael Young, Treasurer/IR .
  • On loan growth outlook: “Clear path to high single digits…investments now materially pulling through…focus on profitability enhancements.” – CEO .

Q&A Highlights

  • NIM trajectory: Underlying tailwinds from back book repricing and deposit cost actions; 3.35% core NIM by year-end not explicitly updated; more rate cuts could put them higher; Heartland timing a variable .
  • Credit: Increase in criticized/classified loans driven by idiosyncratic items (CRE flooding; C&I owner distributions); losses expected to be limited; many remain on accrual .
  • Capital deployment: Open/ready for additional small-bank M&A; buybacks look attractive post-Heartland close, environment-dependent .
  • Tariffs: Customers preparing via pass-throughs, pre-buys, and flexible contracting; too early to quantify; monitoring C&I exposure most closely .
  • Expense & fees: Q2 adjusted expenses $87–$89m; Q2 noninterest income $20–$22m, with seasonal rebuild and treasury management/SBA contributions .

Estimates Context

  • Q1 2025 vs S&P Global consensus: EPS $0.38 actual vs $0.395 est.; Revenue $134.4m actual vs $137.9m est. (slight misses). Company-reported net revenues were $140.7m (definition/FTE differences vs S&P “Revenue”) .
  • Prior quarters: Q4 2024 EPS outperformed (actual $0.48 vs $0.338 est.), revenue slightly below ($129.2m vs $131.5m est.); Q3 2024 EPS in line ($0.36 vs $0.357 est.), revenue below ($124.1m vs $129.2m est.)*.
  • Revisions watch: Momentum in NII and NIM expansion plus pipeline strength argue for upward bias to out-year NII assumptions; elevated provision and seasonal expense patterns may temper EPS trajectory near-term .

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Funding and margin tailwinds are intact: CoD down to 1.93% and NIM at 3.48% with ex-accretion margin up 19 bps q/q; supports further NII growth .
  • Organic growth engine is working: Loan pipeline at $982m (up from $693m) and noninterest-bearing DDA rising signal sustained relationship gains into Q2 .
  • Credit is resilient: NPL ratio improved to 0.68% and ACL coverage steady at 1.34%; criticized uptick looks idiosyncratic per management .
  • Modest miss vs consensus in Q1 is more mix/seasonality than structural; watch Q2 noninterest income and expense guide execution ($20–$22m; $87–$89m) for operating leverage .
  • Heartland adds earnings optionality: pre-purchase lift at 5.7% TEY should enhance asset yields; timing of close impacts NIM path; post-close buyback/M&A optionality remains .
  • Near-term trading lens: Strong NII/NIM trajectory and better NPLs are positives; higher provision and small revenue/EPS misses may cap immediate upside until Q2 execution confirms trajectory.
  • Medium-term thesis: Florida growth, granular deposits, high Tier 1 capital (14.7%) underpin durable ROA/ROTCE improvements as fixed-rate back book reprices and talent investments scale .

Additional Details and References

  • Q1 2025 Press Release & 8-K: full financials, balance sheet, credit metrics .
  • Q1 2025 Earnings Call Transcript: NII outlook, fee/expense guidance, credit and tariff commentary, Heartland pre-purchase rationale .
  • Dividend: $0.18 per share declared April 17, 2025 (payable June 30, 2025) .
  • Prior quarters for trend: Q4 2024 8-K; Q3 2024 8-K .