Heritage Financial (HFWA) Misses Q4 EPS by 3c

Heritage Financial (NASDAQ: HFWA) reported Q4 EPS of $0.47, $0.03 worse than the analyst estimate of $0.50. Revenue for the quarter came in at $54.87 million versus the consensus estimate of $59.35 million.

Brian L. Vance, Chief Executive Officer of Heritage, commented, "We are pleased with our overall growth in 2018. We achieved some important milestones during the year including surpassing the $5.0 billion mark in total assets with the acquisitions of Puget Sound Bancorp, Inc. and Premier Commercial Bancorp. It is significant to note that our year-over-year asset growth was 29.3%.

"As the year was coming to a close we also hired a new team of bankers in the Portland, Oregon market in addition to the team we hired in 2017. With the two acquisitions and the new teams we have hired, we have significantly increased our presence and market share in the largest two markets in the Pacific Northwest, which has been an important initiative of ours in the past few years.

"Even when including $0.27 of one-time and merger-related expenses in 2018, we were still able to report diluted earnings per share of $1.49 for the year, a 7.2% improvement over the prior year. We are pleased to declare a regular cash dividend of $0.18 per share which is a 5.9% increase from the $0.17 per common share declared in the fourth quarter of 2017. Our tangible common equity remains strong at 9.9% which will support our ongoing strategy of organic growth and growth from future acquisitions."

Jeffrey J. Deuel, President and Chief Executive Officer of Heritage Bank commented, "We are pleased with our overall financial performance. In spite of the fact that we did not see the loan growth we had expected due to historically high loan prepayments during the second half of the year, our loan pipeline and new loan originations remain quite strong. We also saw nice growth in overall deposits as a result of our long-term focus on growing deposits. Our 82.4% loan to deposit ratio provides us with the flexibility to successfully manage through the current competitive rate environment. We have also seen continuing improvement in our net interest margin due to disciplined loan and deposit pricing strategies.

"The combination of legacy Heritage, two acquisitions, two new teams we brought on in the Portland, Oregon market over the past 20 months, and some selective hiring in both the front and back office positions us well for the future."

For earnings history and earnings-related data on Heritage Financial (HFWA) click here.

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