NASDAQ$IBCP

Independent Bank Corporation · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Reported net income of $17.3 million for the third quarter of 2022

Independent Bank Corporation reported a strong third quarter in 2022, marked by an increase in net income and diluted earnings per share compared to the previous year. The company saw substantial growth in net interest income, driven by an expansion of the net interest margin and an increase in average interest-earning assets. Additionally, asset quality remained high, with low levels of past due loans and non-performing assets.

  • Net income and diluted earnings per share increased by 8.4% and 11.0%, respectively, over the third quarter of 2021.
  • Portfolio loans experienced net growth of $151.0 million, or 18.4% annualized.
  • Annualized return on average assets and average equity were 1.40% and 20.48%, respectively.
  • Net interest income increased by 18.0% over the third quarter of 2021.

Headline financials

Total Revenue

$56.8M

Previous: $53.5M+6.1%
EPS (adj)

$0.81

Previous: $0.73+11.0%
Net Interest Margin

3.5%

No prior period
Return on Avg Assets

1.4%

Previous: 1.4%+0.0%
Return on Avg Equity

20.5%

Previous: 15.9%+28.6%
NPA to Total Assets

0.1%

No prior period
Allowance to NPLs

1340.2%

No prior period
Capital Expenditures

-$3.97M

Previous: -$4.54M+12.5%
Free Cash Flow

$13.3M

Previous: $11.4M+16.7%
Net Income

$17.3M

Previous: $16M+8.4%
Operating Income

$46.8M

Previous: $49.5M-5.6%
Gross Profit

$53.6M

Previous: $52.8M+1.5%
Cash & Equivalents

$70.6M

Previous: $126M-43.8%
Total Assets

$4.93B

Previous: $4.62B+6.7%
Stock-Based Comp

$535K

Previous: $499K+7.2%

Revenue & EPS history

Independent Bank · Revenue · Quarterly

$56.8M

Q3 2022+6.1%vs Q3 2021
Beat estimate in 11 of 14 quarters(79%)
ActualEstimate

Revenue by segment

Independent Bank · $10.5M total across 2 segments · Q1 2022

  • Mortgage Servicing Net
    $9.64M
  • Net Gains on Mtg Loans
    $835K

Forward guidance

Independent Bank Corporation's focus for the fourth quarter of 2022 includes rotating earning assets into higher yielding loans, growing the deposit base while managing funding costs, and controlling non-interest expenses. Despite increasing concerns about a potential economic slowdown, the company continues to observe healthy economic conditions and loan demand in Michigan and anticipates continued growth trends into 2023.

Tailwinds

  • Rotation of earning asset mix out of lower yielding investments into higher yielding loans
  • Growing deposit base while managing cost of funds
  • Controlling non-interest expenses
  • Healthy economic conditions in Michigan
  • Strong loan demand in Michigan

Headwinds

  • Increasing concern about a potential economic slowdown
  • Potential economic slowdown could impact loan demand
  • Economic slowdown could impact asset quality
  • Economic slowdown could impact profitability
  • Economic slowdown could impact growth trends

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 Q3 2022

Historical avgQ3 2022

+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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