Executive Summary

Q1 FY2025 (quarter ended September 30, 2024) produced a small net loss of $21 thousand (basic/diluted EPS $(0.00)), with net interest income of $4.141 million and non‑interest income of $650 thousand; net interest margin expanded to 2.29% from 2.25% in Q4 FY2024 and 2.15% in Q3 FY2024 .
Credit quality strengthened: a $395 thousand recovery for credit losses was recorded, NPLs/loans fell to 0.67%, and non‑performing assets/total assets improved to 0.38% .
Dividend maintained at $0.03/share and active capital management continued (125,441 shares repurchased at $11.83/share in Q1); book value per share rose to $13.91 (tangible $13.35) on OCI improvement driven by lower market rates .
Strategic backdrop: announced all‑stock merger with Mid Penn Bancorp at an exchange ratio of 0.426 MPB shares per WMPN share; closing targeted for Q2 2025 pending approvals, with management expecting rate cuts to be a profitability tailwind given liability‑sensitive positioning .

What Went Well and What Went Wrong

What Went Well
- Net interest margin continued to inflect higher (2.29%), aided by lower market rates; management: “We are encouraged by the 50 basis point rate cut…we believe…will help improve our profitability prospectively due to the liability‑sensitive position of our balance sheet.” .
- Credit quality and provisioning: $395 thousand recovery for credit losses, NPLs/loans 0.67%, NPAs/assets 0.38% reflecting strong underwriting and low net charge‑offs .
- Capital and book value accretion: OCI improved by $4.8 million on AFS securities, lifting book value per share to $13.91 and tangible book to $13.35; dividend held at $0.03/share .
What Went Wrong
- Profitability remains challenged by funding costs; net interest income declined year‑over‑year ($4.141 million vs. $4.744 million), with deposit interest expense up to $3.491 million .
- Efficiency ratio elevated at 111.10% (core 112.97%), indicative of revenue pressure despite cost control .
- Loan balances declined sequentially ($462.2 million vs. $470.6 million) as cautious lending and pricing discipline persisted in a tough demand environment .

Financial Results

Metric	Q3 FY2024 (Mar 31, 2024)	Q4 FY2024 (Jun 30, 2024)	Q1 FY2025 (Sep 30, 2024)
Net interest income ($)	$4.014 million	$4.152 million	$4.141 million
Non-interest income ($)	$725 thousand	$633 thousand	$650 thousand
Provision/(Recovery) for credit losses ($)	$(505) thousand	$(131) thousand	$(395) thousand
Net income ($)	$136 thousand	$(158) thousand	$(21) thousand
Basic/diluted EPS ($)	$0.02 / $0.02	$(0.02) / $(0.02)	$(0.00) / $(0.00)
Net interest margin (%)	2.15%	2.25%	2.29%
Total assets ($)	$833.189 million	$818.747 million	$812.229 million

Segment breakdown: Not applicable; community banking activities reported on a consolidated basis .

KPIs

KPI	Q3 FY2024	Q4 FY2024	Q1 FY2025
NPLs / Total loans (%)	0.62%	0.70%	0.67%
NPAs / Total assets (%)	0.41%	0.40%	0.38%
ACL / Total loans (%)	0.65%	0.63%	0.54%
Book value per share ($)	$13.30	$13.33	$13.91
Tangible book value per share ($)	$12.74	$12.78	$13.35

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Quarterly dividend	Q1 FY2025	$0.03/share (prior quarters)	$0.03/share	Maintained
Merger timeline (Mid Penn)	FY2025	N/A	Expected close in Q2 2025, subject to approvals	New (announced)
Strategic outlook on rates	Q1 FY2025	N/A	Lower rates expected to aid profitability given liability sensitivity	New directional commentary

No explicit revenue/EPS/OpEx numeric guidance was provided in Q1 FY2025 materials .

Earnings Call Themes & Trends

Note: No earnings call transcript identified for Q1 FY2025 (none found) [ListDocuments: earnings-call-transcript=0].

Topic	Previous Mentions (Q3, Q4 FY2024)	Current Period (Q1 FY2025)	Trend
Interest rate/margin	NIM 2.15% (Q3) with deposit/borrowing cost pressure; NIM 2.25% (Q4) early inflection	NIM 2.29%; management expects further tailwind from rate cuts	Improving
Asset quality	Recoveries and low charge‑offs; NPAs/assets 0.40% (Q4)	Recovery for credit losses $395k; NPAs/assets 0.38%	Stable to improving
Capital/actions	Ongoing buybacks; BV accretion; dividend maintained	Buybacks continued; BV and TBV up on OCI improvement; dividend maintained	Accretive
Deposits/mix	Time deposits rising; money market & savings down; competitive pricing	Time deposits up; other categories down; total deposits flat q/q	Mix shift to time deposits
Strategic M&A	N/A	Announced merger with Mid Penn, 0.426x exchange ratio; close targeted Q2 2025	Transformational

Management Commentary

“We are encouraged by the 50 basis point rate cut by the Fed…We believe…further rate cuts…will help to improve our profitability prospectively due to the liability‑sensitive position of our balance sheet.” — Kenneth J. Stephon, Chairman, President & CEO (Q1 FY2025 press release) .
“We remain focused on the continued strength of our balance sheet…solid growth in our loan portfolio and continued improvement in our asset quality.” — Kenneth J. Stephon (Q2 FY2025 press release for context) .
“Operating expenses remained well‑controlled, with a year‑over‑year increase of 1.9%.” (Q1 FY2025 press release) .

Q&A Highlights

No Q1 FY2025 earnings call transcript available; no Q&A highlights identified [ListDocuments: earnings-call-transcript=0].

Estimates Context

We attempted to retrieve S&P Global consensus for Q1 FY2025 (EPS and revenue), but no S&P Global CIQ mapping was available for WMPN at time of request; therefore, consensus comparisons are unavailable. Values retrieved from S&P Global were unavailable (mapping error).

Key Takeaways for Investors

Margin trajectory improving: NIM rose to 2.29% with management expecting lower rates to further aid profitability given liability‑sensitive balance sheet positioning .
Credit quality remains a differentiator: recovery for credit losses ($395k), low NPAs (0.38%) and NPLs (0.67%) support capital preservation in a tough funding environment .
Capital accretion and shareholder returns: book value and tangible book rose on OCI improvement; dividend at $0.03 and buybacks continued, signaling confidence in balance sheet resilience .
Funding costs still a headwind: deposit interest expense elevated ($3.491 million) and net interest income down YoY, underscoring the importance of mix management and pricing discipline .
Strategic catalyst: announced stock‑for‑stock merger with Mid Penn (0.426 exchange ratio) with anticipated close in Q2 2025; integration and regulatory approvals are the next milestones .
Near‑term focus: manage deposit mix toward term funding, maintain expense discipline, and leverage probable rate tailwinds to expand margins while preserving credit quality .

Appendix: Additional Data Points

Total assets decreased to $812.2 million (vs. $818.7 million), with loans down $8.4 million and investments down $2.9 million; cash and equivalents increased $6.3 million QoQ .
Deposits consistent at $629.8 million, with time deposits +$10.2 million offsetting declines in checking/savings/money market .
Stockholders’ equity rose $3.7 million to $128.3 million on OCI improvement, partially offset by buybacks/dividends and net loss .

All data and statements above are sourced from William Penn’s Q1 FY2025 8‑K press release and 10‑Q, prior quarter press releases, and merger filings as cited.

William Penn Bancorporation (WMPN)·Q1 2025 Earnings Summary