NASDAQ$AROW

Arrow Financial Corporation · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

Reported $9.2 million in net income for Q2, with revenue increase and loan growth amid COVID-19 response.

Arrow Financial Corporation reported a net income of $9.2 million for the second quarter of 2020, compared to $8.9 million in the same quarter of the previous year. Revenue increased by 11.9%, and total loans grew by $147.7 million, including $140.0 million in PPP loans. The company continues to manage its COVID-19 response, focusing on health and safety while providing essential banking services.

  • Total loans grew by $147.7 million in Q2 2020, including $140.0 million in PPP loans.
  • Second quarter revenue increased by 11.9% over the prior year.
  • Net income was $9.2 million and diluted EPS was $0.61 for the second quarter.
  • Provision for loan losses was $3.0 million in the second quarter, reflecting COVID-19 uncertainty.

Headline financials

Total Revenue

$32M

Previous: $28.6M+11.9%
EPS (adj)

$0.57

Previous: $0.56+1.8%
Net Interest Margin

3.0%

No prior period
Efficiency Ratio

53.1%

No prior period
Tier 1 Risk-Based Capital Ratio

13.9%

No prior period
Total Risk-Based Capital Ratio

15.1%

No prior period
Capital Expenditures

-$2.04M

Previous: -$4.39M+53.5%
Free Cash Flow

$7.12M

Previous: $4.55M+56.6%
Net Income

$9.16M

Previous: $8.93M+2.5%
Operating Income

$22.3M

Previous: $20.4M+9.3%
Gross Profit

$29M

Previous: $28.1M+2.9%
Cash & Equivalents

$253M

Previous: $62.7M+304.0%
Total Assets

$3.55B

Previous: $3.01B+18.0%
Stock-Based Comp

$106K

Previous: $99K+7.1%

Revenue & EPS history

Arrow Financial · Revenue · Quarterly

$32M

Q2 2020+11.9%vs Q2 2019
Beat estimate in 10 of 15 quarters(67%)
ActualEstimate

Forward guidance

Arrow Financial is actively monitoring the impact of the pandemic on its business and results of operations. The slowing economy and deteriorating economic outlook may lead to the continuation of elevated unemployment and decreased consumer and commercial spending.

Tailwinds

  • All banking locations and some insurance locations are open to the public.
  • Through a mix of onsite and remote work amongst our team, we continue to meet customer needs and deliver high-quality service daily.
  • Arrow assisted more than 1,400 small businesses in our communities, resulting in more than $140 million in funding in support of more than 18,000 jobs.
  • Arrow's liquidity position was strong, and provides flexibility to address unexpected near-term disruptions that may develop as a result of the COVID-19 pandemic
  • Arrow's capital reserves are well positioned to address the uncertainties related to the COVID-19 pandemic.

Headwinds

  • The slowing economy and deteriorating economic outlook may lead to the continuation of elevated unemployment and decreased consumer and commercial spending.
  • These factors may have adverse effects on our customer deposits.
  • These factors may have adverse effects on the ability of our borrowers to satisfy their obligations.
  • These factors may have adverse effects on the demand for loans and our other financial products and services.
  • Although Arrow has taken, and will continue to take, steps to mitigate against the impact of the pandemic on its operations, it cannot provide any assurance that these actions will be successful.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2020

Historical avgQ2 2020

+0.8%

Avg return

Earnings day

+2.2%

Avg return

5 days after

+2.6%

Avg return

30 days after

56%

37 / 66 earnings

Positive

+11.8%

Q3 2023

Best reaction

-5.7%

Q1 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.9%+2.8%+1.7%
Q4 2025+1.9%+9.3%+2.7%
Q3 2025+3.0%+14.3%+14.0%
Q2 2025-1.4%-3.5%+0.2%
Q1 2025-0.2%+0.4%-1.0%
Q4 2024-2.1%-2.6%-2.2%
Q3 2024-1.8%+0.2%+12.4%
Q2 2024+3.7%+2.5%-1.5%
Q1 2024+2.1%+3.8%+10.4%
Q4 2023-4.0%-5.3%-4.9%
Q3 2023+11.8%+16.9%+36.1%
Q2 2023-5.0%-5.3%-14.2%
Q1 2023-5.7%-4.8%-19.6%
Q4 2022+0.2%-1.4%-8.5%
Q3 2022+10.9%+11.6%+14.6%
Q2 2022+0.9%+1.8%-0.2%
Q1 2022-0.5%+0.1%+4.9%
Q4 2021-2.4%-1.7%-2.3%
Q3 2021-1.9%-0.3%+2.5%
Q2 2021+0.2%+0.1%-1.1%
Q1 2021+4.0%+3.3%+6.6%
Q4 2020-0.5%+0.4%+7.8%
Q3 2020+6.0%+4.0%+10.5%
Q2 2020+2.1%+2.0%+1.1%
Q1 2020+9.1%+16.8%+5.4%
Q4 2019-1.8%-2.4%-9.9%
Q3 2019+1.2%+1.6%+6.6%
Q2 2019-2.0%+0.1%-2.6%
Q1 2019-0.6%+1.8%-0.3%
Q4 2018-0.6%+2.2%+11.1%
Q3 2018+0.1%-0.8%-0.7%
Q2 2018+1.4%+2.6%+3.4%
Q1 2018+4.2%+3.0%+8.3%
Q4 2017-2.4%-1.2%-3.4%
Q3 2017-0.7%+5.3%+1.1%
Q2 2017+2.5%+4.0%+1.6%
Q1 2017-0.4%+4.6%-4.2%
Q4 2016-0.5%+1.9%-1.9%
Q3 2016-1.8%-0.4%+19.2%
Q2 2016-0.3%+2.1%+1.4%
Q1 2016+3.3%
Q4 2015+0.8%
Q3 2015-2.1%
Q2 2015+3.1%
Q1 2015-0.8%
Q4 2014+2.0%
Q3 2014+0.8%
Q2 2014+0.5%
Q1 2014-0.1%
Q4 2013+2.7%
Q3 2013+0.9%
Q2 2013+0.4%
Q1 2013-0.3%
Q4 2012-0.3%
Q3 2012-0.8%
Q2 2012+0.1%
Q1 2011+0.4%
Q1 2012+0.4%
Q4 2009-2.6%
Q4 2011-2.6%
Q3 2010+3.2%
Q3 2011+3.2%
Q4 2010+2.5%
Q2 2010+2.5%
Q2 2011+2.5%
Q1 2010+4.7%

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