NASDAQ$NKSH

National Bankshares Inc · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Reported a decrease in net income due to intense interest rate pressure, costs from a proxy contest, and increased salary expense.

National Bankshares, Inc. reported a decrease in net income for the second quarter of 2023, with net income of $3.90 million, or $0.66 earnings per share, compared to $5.57 million, or $0.93 earnings per share, for the same period in 2022. The decrease was attributed to interest rate pressure, expenses from a proxy contest, and increased salary expenses.

  • Net income decreased compared to both Q1 2023 and Q2 2022.
  • Rising interest rates and competition for deposits compressed the net interest margin.
  • A gain of $2.97 million was recognized on the sale of VISA Class B securities.
  • Construction on a new branch in Roanoke, Virginia will begin during the third quarter of 2023.

Headline financials

Total Revenue

$12M

Previous: $13.4M-10.3%
EPS (adj)

$0.66

Previous: $0.93-29.0%
Free Cash Flow

$3.9M

Previous: $5.57M-30.0%
Net Income

$3.9M

Previous: $5.57M-30.0%
Operating Income

$5.03M

Previous: $11.7M-57.0%
Gross Profit

$12M

Previous: $13.4M-10.4%
Cash & Equivalents

$14.8M

Previous: $11.8M+25.6%
Total Assets

$1.63B

Previous: $1.73B-5.8%
Stock-Based Comp

$5K

No prior period

Revenue & EPS history

National Bankshares · Revenue · Quarterly

$12M

Q2 2023-10.3%vs Q2 2022
Beat estimate in 8 of 14 quarters(57%)
ActualEstimate

Forward guidance

National Bankshares is focused on returning to increased profitability in the second half of 2023 by deploying capital through sound loans, seeking new growth opportunities, deepening existing relationships, increasing operational efficiencies, and reducing costs while maintaining customer experience.

Tailwinds

  • Well-capitalized
  • Lenders are working to deploy capital through sound, profitable loans
  • Talented community bankers are seeking new opportunities for growth
  • Deepening existing relationships to deliver profits through multiple lines of service
  • Working to increase operational efficiencies and reduce costs while maintaining customer experience

Headwinds

  • Intense interest rate pressure
  • Drastic increases in the interest paid on deposits outpaced the return on loans and other assets, resulting in lower net interest income
  • Costs incurred by National Bankshares in a successfully-averted proxy contest
  • Increased salary expense resulting from last year’s 4th quarter base pay increase contributed to lower net income
  • Current economic environment may last for some time

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 2023

Historical avgQ2 2023

-0.6%

Avg return

Earnings day

+0.5%

Avg return

5 days after

+2.0%

Avg return

30 days after

45%

30 / 66 earnings

Positive

+5.9%

Q3 2017

Best reaction

-12.0%

Q3 2012

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-2.7%-2.3%-3.4%
Q4 2025+0.1%-0.0%+6.9%
Q3 2025-1.1%-0.8%+1.8%
Q2 2025-1.2%+2.1%+5.3%
Q1 2025+0.7%+0.2%-1.9%
Q4 2024-1.6%+0.6%-7.7%
Q3 2024-3.9%+1.0%+7.0%
Q2 2024+0.2%+1.9%+4.8%
Q1 2024+2.9%-1.8%-3.5%
Q4 2023-0.3%-1.0%-17.0%
Q3 2023+0.6%+2.6%+15.9%
Q2 2023-4.6%-6.9%-16.0%
Q1 2023-0.2%+1.4%+7.5%
Q4 2022+0.8%+5.3%+3.6%
Q3 2022-0.2%+3.1%+10.9%
Q2 2022+1.2%+2.8%+8.8%
Q1 2022-2.0%-4.0%-5.3%
Q4 2021+1.3%+1.4%+4.1%
Q3 2021-0.6%+1.4%+3.4%
Q2 2021+0.6%+0.4%+9.7%
Q1 2021+2.8%+3.3%+0.4%
Q4 2020+3.1%+2.0%+13.6%
Q3 2020+5.4%+9.7%+13.8%
Q2 2020+2.3%+7.9%-2.0%
Q1 2020+3.3%-2.8%+26.1%
Q4 2019-1.7%-2.1%-15.9%
Q3 2019+1.1%+0.6%+1.8%
Q2 2019-0.4%-5.1%-6.4%
Q1 2019-0.9%+1.7%-1.2%
Q4 2018+0.9%+7.7%+13.7%
Q3 2018-1.4%+1.4%-2.6%
Q2 2018-1.9%-0.1%-0.6%
Q1 2018+0.2%-0.5%+5.7%
Q4 2017+5.2%+10.1%+14.6%
Q3 2017+5.9%-1.1%-1.8%
Q2 2017-2.4%-2.4%-5.9%
Q1 2017-2.7%-5.7%-7.2%
Q4 2016-6.2%-5.7%-6.2%
Q3 2016-0.9%-1.9%+5.6%
Q2 2016-0.6%-2.8%+1.2%
Q1 2016-2.6%
Q4 2015-0.0%
Q3 2015-7.5%
Q2 2015-2.1%
Q1 2015-0.0%
Q4 2014-1.0%
Q3 2014+0.8%
Q2 2014-2.0%
Q1 2014-3.0%
Q4 2013+0.8%
Q3 2013+3.0%
Q2 2013-0.1%
Q1 2013+2.1%
Q4 2012-1.5%
Q3 2012-12.0%
Q2 2012+0.0%
Q1 2011-1.4%
Q1 2012+1.8%
Q4 2009+0.7%
Q4 2011+0.7%
Q4 2010+0.7%
Q3 2010-10.1%
Q3 2011-10.1%
Q2 2010+4.7%
Q2 2011+4.7%
Q1 2010-4.6%

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