Primis Financial (FRST) investor relations material

Executive summary

• Q3 net income was $8.67 million, or $0.35 per diluted share, versus $6.83 million and $0.28 a year earlier; pre-tax, pre-provision operating earnings rose to $11.96 million from $8.67 million.

• Q3 operating ROA was 0.80% versus 0.70% a year earlier; Core Bank ROA was 1.42%, while mortgage conditions weighed on consolidated results.

• Adjusted nine-month operating net income was $22.3 million, or $0.90 per diluted share, up 211% YoY, excluding investment gains and other nonrecurring items.

Financial highlights

• Q3 net interest income was $36.3 million, up 25% YoY; excluding a $0.7 million interest recovery, NII was $35.6 million, up 23% YoY and 5.5% QoQ.

• Noninterest income was $12.9 million versus $22.0 million in Q2, which included a $5.9 million investment gain; noninterest expense was $37.2 million versus $38.2 million in Q2.

• Core operating expense burden was $24.2 million versus $24.9 million in Q2; Q3 included $1.4 million of loan-related costs and $0.4 million of professional and third-party fees.

• At September 30, assets were $4.30 billion, loans held for investment were $3.50 billion and deposits were $3.47 billion; loans rose 9% and deposits 4% YoY.

Outlook and guidance

• Management expects ~4–5 bps of further margin expansion over time, supported by loan repricing over the next 2–3 quarters; $570 million of fixed-rate loans at a 5.31% weighted-average coupon reprice over four quarters, alongside $530 million of floating-rate loans.

• Loan growth is expected near 8% for the year and mid-to-high single digits next year; core bank growth guidance is 5%–7% annually. Deposit growth is expected at 3%–5% this year, with stronger growth anticipated next year.

• Core expenses are expected near $22.5 million per quarter in Q4, then lower from Q1 2027; vendor consolidation and statement services are expected to deliver $3.0 million in annualized savings beginning early 2027.

• Quarterly digital-platform development amortization of $0.8 million is expected to end in Q3 2027; further AI-driven efficiencies are being pursued.

• Management sees 1% ROA in sight; peer-level ROA would require a further ~15 bps, and mortgage net-overhead breakeven would have lifted Q3 ROAA to ~1.00%.