Peoples Bancorp (PEBO) Tops Q1 EPS by 2c

Peoples Bancorp (NASDAQ: PEBO) reported Q1 EPS of $0.64, $0.02 better than the analyst estimate of $0.62.

Statement of Operations Highlights:

• Net interest income grew 1% compared to the fourth quarter of 2017, which included two additional days, and 9% compared to the first quarter of 2017.
  • Net interest margin was 3.66% for the first quarter of 2018, compared to 3.63% for the linked quarter and 3.55% for the first quarter of 2017.
  • The first quarter of 2018 benefited from proceeds received on an investment security that had previously been written down due to an other-than-temporary impairment, which added 4 basis points to net interest margin.
• Provision for loan losses was $2.0 million for the first quarter of 2018, an increase of $0.9 million from the linked quarter, and $1.4 million from the first quarter of 2017.
  • During the first quarter of 2018, a charge-off of $827,000 was recorded for one acquired commercial loan relationship.
• Total fee-based income increased 14% during the first quarter of 2018 compared to the linked quarter, and 12% compared to the first quarter of 2017.
  • The increase compared to the linked quarter was largely due to annual performance-based insurance commissions, which are recognized in the first quarter of each year.
  • The increase compared to the first quarter of 2017 was partially due to the implementation of the new revenue recognition accounting standard and income related to the acquisition of a third-party insurance administration company on January 31, 2017 and a property and casualty focused independent insurance agency on October 2, 2017.
• Total non-interest expense was up 3% for the first quarter of 2018 compared to both the linked quarter and the first quarter of 2017.
  • The first quarter of 2018 included certain salaries and benefits expenses that will not recur in subsequent quarters of 2018, including Health Savings Account contributions and a one-time stock award granted to employees, which together accounted for 57% of the increase in salaries and benefits expenses compared to the linked quarter.
  • The efficiency ratio continued to improve and was 61.8% for the first quarter of 2018, compared to 62.1% for the fourth quarter of 2018 and 64.9% for the first quarter of 2017.
• Operating leverage was positive for the first quarter of 2018 compared to the first quarter of 2017.
  • Compared to the first quarter of 2017, revenue was up 10%, while expenses grew 3%.
  • Accounting Standards Update ("ASU") 2016-01, which requires changes in the fair value of equity securities to be recognized in income beginning January 1, 2018, contributed 2% of the revenue growth for the quarter.

For earnings history and earnings-related data on Peoples Bancorp (PEBO) click here.

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