NYSE$CPF

Central Pacific Financial Corp · Q2 2020 earnings

Q2 2020 earnings · · Investor relations

Briefing

Reported net income of $9.9 million and EPS of $0.35, driven by strong pre-tax pre-provision earnings and supported by PPP loan originations and core deposit increases.

Central Pacific Financial Corp. reported a net income of $9.9 million, or $0.35 per diluted share, for the second quarter of 2020. The results were impacted by a higher provision for credit loss expense due to deteriorating economic conditions from the COVID-19 pandemic. The company supported over 7,200 small businesses with SBA Paycheck Protection Program (PPP) loan originations totaling $556.9 million.

  • Net income for the second quarter was $9.9 million, or fully diluted EPS of $0.35.
  • Pre-tax pre-provision earnings were $23.5 million for the second quarter.
  • Total loans increased by $491.4 million, or 10.9% sequentially, largely contributed by SBA Paycheck Protection Program (“PPP”) loan originations.
  • Core deposits increased by $719.3 million, or 16.7% sequentially.

Headline financials

Total Revenue

$60M

Previous: $55.5M+8.1%
EPS (adj)

$0.35

Previous: $0.47-25.5%
Efficiency Ratio

60.8%

No prior period
Net Interest Margin

3.3%

No prior period
CET1 Capital Ratio

11.4%

No prior period
Tier 1 Risk-Based Capital Ratio

12.5%

No prior period
Total Risk-Based Capital Ratio

13.6%

No prior period
Leverage Ratio

8.9%

No prior period
Capital Expenditures

-$11.7M

Previous: -$1.4M-735.6%
Free Cash Flow

-$1.78M

Previous: $12.1M-114.7%
Net Income

$9.92M

Previous: $13.5M-26.7%
Operating Income

$49.2M

Previous: $40.3M+22.2%
Gross Profit

$60M

Previous: $55.5M+8.1%
Cash & Equivalents

$143M

Previous: $98.7M+45.2%
Total Assets

$6.63B

Previous: $5.92B+12.0%
Stock-Based Comp

$723K

Previous: $350K+106.6%

Revenue & EPS history

Central Pacific Financial · Revenue · Quarterly

$60M

Q2 2020+8.1%vs Q2 2019
Beat estimate in 9 of 16 quarters(56%)
ActualEstimate

Forward guidance

The document contains forward-looking statements concerning projections of revenues, expenses, income or loss, earnings or loss per share, capital expenditures, the payment or nonpayment of dividends, capital position, credit losses, net interest margin or other financial items.

Tailwinds

  • Statements of plans, objectives and expectations of Central Pacific Financial Corp. or its management or Board of Directors, including those relating to business plans, use of capital resources, products or services and regulatory developments and regulatory actions.
  • Statements of future economic performance including anticipated performance results from our RISE2020 initiative.
  • Any statements of the assumptions underlying or relating to any of the foregoing.
  • Words such as "believes," "plans," "anticipates," "expects," "intends," "forecasts," "hopes," "targeting," "continue," "remain," "will," "should," "estimates," "may" and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.
  • While we believe that our forward-looking statements and the assumptions underlying them are reasonably based, such statements and assumptions are by their nature subject to risks and uncertainties, and thus could later prove to be inaccurate or incorrect.

Headwinds

  • The adverse effects of the COVID-19 pandemic virus on local, national and international economies, including, but not limited to, the adverse impact on tourism and construction in the State of Hawaii, our borrowers, customers, third-party contractors, vendors and employees as well as the effects of government programs and initiatives in response to COVID-19.
  • The increase in inventory or adverse conditions in the real estate market and deterioration in the construction industry.
  • Adverse changes in the financial performance and/or condition of our borrowers and, as a result, increased loan delinquency rates, deterioration in asset quality, and losses in our loan portfolio.
  • Our ability to successfully implement our RISE2020 initiative.
  • The impact of local, national, and international economies and events (including natural disasters such as wildfires, volcanic eruptions, hurricanes, tsunamis, storms, earthquakes and pandemic virus and disease, including COVID-19) on the Company's business and operations and on tourism, the military, and other major industries operating within the Hawaii market and any other markets in which the Company does business.

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

+0.6%

Avg return

Earnings day

-0.1%

Avg return

5 days after

+1.6%

Avg return

30 days after

53%

35 / 66 earnings

Positive

+15.9%

Q1 2010

Best reaction

-10.1%

Q3 2022

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.1%-3.1%-0.7%
Q4 2025+0.0%+4.1%+0.5%
Q3 2025-6.3%-4.2%-1.8%
Q2 2025-0.2%-0.8%+6.4%
Q1 2025+1.0%-1.2%+1.4%
Q4 2024+3.0%+2.4%+1.6%
Q3 2024-7.6%-7.8%+9.5%
Q2 2024-0.7%-4.5%+5.8%
Q1 2024+4.0%+1.4%+3.5%
Q4 2023-0.6%-4.4%-5.9%
Q3 2023+1.9%+1.9%+12.7%
Q2 2023-0.7%+0.2%-6.2%
Q1 2023+4.4%+3.8%+1.6%
Q4 2022+4.4%+4.5%+11.0%
Q3 2022-10.1%-12.1%-5.6%
Q2 2022+1.8%+2.3%-0.8%
Q1 2022-2.4%-7.0%-16.1%
Q4 2021-2.3%-1.9%-2.2%
Q3 2021+1.9%+4.1%+0.5%
Q2 2021+3.2%+1.0%+4.6%
Q1 2021+2.9%+5.3%+4.1%
Q4 2020+4.2%+6.3%+15.9%
Q3 2020-3.8%-2.5%+22.5%
Q2 2020+6.6%+3.9%+8.0%
Q1 2020+4.4%+6.7%+1.8%
Q4 2019+1.5%+1.5%-14.4%
Q3 2019-2.2%-1.3%-1.2%
Q2 2019-5.4%-3.5%-8.6%
Q1 2019+0.6%+1.3%-2.2%
Q4 2018+5.8%+6.9%+7.5%
Q3 2018+8.2%+8.9%+12.4%
Q2 2018-1.4%-4.3%-0.3%
Q1 2018-4.0%-6.3%-3.7%
Q4 2017-4.7%-3.8%-8.7%
Q3 2017-2.6%-5.0%-6.5%
Q2 2017-2.7%-2.5%-8.1%
Q1 2017+1.5%+1.4%-2.3%
Q4 2016+8.2%+2.7%+4.1%
Q3 2016+1.2%+1.6%+21.4%
Q2 2016+0.0%-0.6%+3.4%
Q1 2016+5.3%
Q4 2015+7.5%
Q3 2015+0.0%
Q2 2015-0.2%
Q1 2015-3.1%
Q4 2014+7.0%
Q3 2014-2.9%
Q2 2014-4.6%
Q1 2014+2.9%
Q4 2013-3.7%
Q3 2013-0.6%
Q2 2013-0.8%
Q1 2013+5.6%
Q4 2012+4.6%
Q3 2012-2.8%
Q2 2012+3.5%
Q1 2011-2.2%
Q1 2012+3.4%
Q4 2010+0.0%
Q4 2011+0.0%
Q4 2009+0.0%
Q3 2011+0.6%
Q3 2010+0.6%
Q2 2011-6.4%
Q2 2010-6.4%
Q1 2010+15.9%

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