NASDAQ$IBCP

Independent Bank Corporation · Q2 2021 earnings

Q2 2021 earnings · · Investor relations

Briefing

Independent Bank’s second quarter earnings decreased compared to the prior year, reflecting a decrease in non-interest income and an increase in non-interest expense, partially offset by an increase in net interest income and decreases in the provision for credit losses and income tax expense.

Independent Bank Corporation reported a solid financial performance for Q2 2021, with net income of $12.4 million, or $0.56 per diluted share. The company saw an increase in net interest income and strong mortgage loan origination activity. Asset quality metrics were exceptional, with a decline in non-performing assets to total assets.

  • Annualized return on average assets and on average equity of 1.12% and 12.78%, respectively.
  • Net interest income increased by 3.1% over the second quarter of 2020.
  • Net gains on mortgage loans were $9.1 million with a total mortgage loan origination volume of $473.7 million.
  • Net growth in portfolio loans was $30.3 million, or 4.4% annualized.

Headline financials

Total Revenue

$46.2M

Previous: $50.8M-9.2%
EPS (adj)

$0.56

Previous: $0.67-16.4%
Net Interest Margin

3.0%

Previous: 3.4%-10.1%
Return on Avg Assets

1.1%

Previous: 1.5%-27.3%
Return on Avg Equity

12.8%

Previous: 17.4%-26.5%
NPA to Total Assets

0.1%

No prior period
Capital Expenditures

-$3.08M

Previous: -$1.65M-86.4%
Free Cash Flow

$9.31M

Previous: $13.1M-29.1%
Net Income

$12.4M

Previous: $14.8M-16.1%
Operating Income

$40.8M

Previous: $41.9M-2.8%
Gross Profit

$44.7M

Previous: $50.8M-12.0%
Cash & Equivalents

$69.3M

Previous: $55.8M+24.1%
Total Assets

$4.46B

Previous: $4.04B+10.3%
Stock-Based Comp

$505K

Previous: $462K+9.3%

Revenue & EPS history

Independent Bank · Revenue · Quarterly

$46.2M

Q2 2021-9.2%vs Q2 2020
Beat estimate in 13 of 16 quarters(81%)
ActualEstimate

Revenue by segment

Independent Bank · $9.09M total across 1 segment · Q2 2021

  • Net Gains on Mtg Loans
    $9.09M

Forward guidance

Independent Bank Corporation is confident in its ability to effectively respond to the challenges from the pandemic and remains optimistic about its future.

Tailwinds

  • Economic conditions have improved.
  • Earning asset growth has resulted in an increase in net interest income.
  • Mortgage loan origination activity continues to be strong.
  • Asset quality metrics have been exceptional.
  • Completed conversion to a new modern core platform.

Headwinds

  • Challenges from the pandemic remain.
  • Decrease in non-interest income.
  • Increase in non-interest expense.
  • Lower interest rates combined with a higher allocation to lower yielding securities available for sale has placed continued pressure on the Company’s net interest margin.
  • Commercial loan balances, interest income and yields have been impacted by Paycheck Protection Program lending activity.

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 2021

Historical avgQ2 2021

+1.3%

Avg return

Earnings day

+0.5%

Avg return

5 days after

+2.4%

Avg return

30 days after

55%

36 / 65 earnings

Positive

+13.3%

Q4 2010

Best reaction

-7.8%

Q1 2020

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.9%+1.6%+0.7%
Q4 2025+1.0%-0.3%+5.5%
Q3 2025-0.7%-5.2%+2.6%
Q2 2025-1.4%-2.2%-1.1%
Q1 2025-1.2%-0.7%+0.5%
Q4 2024+1.3%+4.2%-3.8%
Q3 2024-2.0%-0.1%+15.9%
Q2 2024+3.2%+4.7%+3.2%
Q1 2024-0.5%-1.2%+1.1%
Q4 2023-3.0%+1.3%-9.2%
Q3 2023+3.5%+5.6%+20.0%
Q2 2023+4.8%+4.4%-4.7%
Q1 2023+4.3%-6.7%+0.1%
Q4 2022-5.8%-3.4%-3.1%
Q3 2022+5.8%+11.1%+17.1%
Q2 2022+0.0%+2.5%+4.8%
Q1 2022-4.0%-7.6%-10.0%
Q4 2021-4.7%-4.4%-6.0%
Q3 2021+0.3%+2.5%+8.0%
Q2 2021+1.0%+2.4%+1.8%
Q1 2021+1.3%+2.3%+1.0%
Q4 2020-1.4%+5.4%+11.0%
Q3 2020-1.4%+0.6%+21.8%
Q2 2020+8.4%+6.9%+13.7%
Q1 2020-7.8%-15.2%-15.0%
Q4 2019-0.7%-2.0%-1.8%
Q3 2019+2.8%+2.8%+0.7%
Q2 2019-1.9%-1.8%-12.6%
Q1 2019-2.9%-2.8%-1.3%
Q4 2018-1.0%-0.5%+3.7%
Q3 2018-1.8%+3.3%+3.7%
Q2 2018-0.8%-2.8%-0.2%
Q1 2018+5.4%+2.1%+5.2%
Q4 2017+1.5%+2.9%+0.2%
Q3 2017+4.0%+1.1%-1.6%
Q2 2017-2.8%+0.2%-2.1%
Q1 2017+8.5%+4.7%-2.1%
Q4 2016+0.5%+0.0%+4.7%
Q3 2016+1.3%+1.0%+12.7%
Q2 2016+2.1%+4.0%+9.0%
Q1 2016+0.7%
Q4 2015+2.2%
Q3 2015-3.0%
Q2 2015+1.2%
Q1 2015+1.2%
Q4 2014+1.5%
Q3 2014-2.5%
Q2 2014+6.8%
Q1 2014-5.2%
Q4 2013-0.4%
Q3 2013+0.3%
Q2 2013-3.4%
Q1 2013-3.0%
Q4 2012+0.3%
Q4 2011+0.3%
Q3 2012-0.9%
Q2 2012+10.2%
Q1 2011-4.1%
Q1 2012+3.6%
Q4 2009+4.2%
Q3 2010+10.7%
Q3 2011+10.7%
Q2 2011+13.3%
Q2 2010+13.3%
Q4 2010+13.3%

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