First Community Bankshares, Inc. Announces First Quarter 2025 Results and Quarterly Cash Dividend

BLUEFIELD, Va., April 22, 2025 (GLOBE NEWSWIRE) -- First Community Bankshares, Inc. (FCBC) (www.firstcommunitybank.com) (the “Company”) today reported its unaudited results of operations and other financial information for the quarter ended March 31, 2025. The Company reported net income of $11.82 million, or $0.64 per diluted common share, for the quarter ended March 31, 2025.  

The Company also declared a quarterly cash dividend to common shareholders of thirty-one cents, $0.31 per common share. The quarterly dividend is payable to common shareholders of record on May 9, 2025, and is expected to be paid on May 23, 2025. This year marks the 40th consecutive year of regular dividends to common shareholders and the prior year was the 15th consecutive year of regular dividend increases.

First Quarter 2025 Highlights

Income Statement

• Net interest margin for the first quarter of 2025 was 4.34%.  The yield on earning assets decreased 5 basis points from the same period of 2024 and is primarily attributable to a decrease in interest income of $867 thousand.  Interest income for loans and securities available-for-sale decreased $2.74 million and $470 thousand, respectively.  The decreases were primarily due to decreases in the average balance for loans and securities available-for-sale of $154.04 million and $89.74 million, respectively.  Additionally, the yield on loans decreased 8 basis points.  The decrease in interest income on loans and securities available-for-sale was somewhat offset by an increase in interest income on interest-bearing deposits with banks.  Interest expense on interest-bearing liabilities increased $472 thousand and is primarily attributable to an increase in yield of 11 basis points.
• Noninterest income increased approximately $970 thousand, or 10.48%, when compared to the same quarter of 2024.  The increase is primarily attributable to an increase in service charges on deposits of $526 thousand, or 15.89%, and an increase in other operating income of $491 thousand, or 35.07%.  Noninterest expense increased $1.56 million, or 6.66% when compared to the same period of 2024.  The increase is primarily attributable to an increase in salaries and benefits of $754 thousand, or 5.99%.
• Annualized return on average assets ("ROA") was 1.49% for the first quarter of 2025 compared to 1.60% for the same period of 2024. Annualized return on average common equity ("ROE") was 9.49% for the first quarter of 2025 compared to 10.18%  for the same period of 2024.  

Balance Sheet and Asset Quality

• Consolidated assets totaled $3.23 billion at March 31, 2025.
• Loans decreased $33.39 million, or 1.38%, from December 31, 2024.  Securities available for sale decreased $40.19 million, or 23.66%, from December 31, 2024.  Deposits decreased $6.77 million, or 0.25%, which was largely a function of declining higher-rate time deposits.  Stockholder equity decreased $29.98 million, or 5.69% due to the payment of a special cash dividend in the first quarter of 2025.  The net effect of these balance sheet changes resulted in an increase in cash and cash equivalents of $37.23 million, or 9.86%.  
• The Company did not repurchase any common shares during the first quarter of 2025.
• Non-performing loans to total loans increased to 0.85% when compared with the same quarter of 2024.  The Company experienced net charge-offs for the first quarter of 2025 of $1.39 million, or 0.24% of annualized average loans, compared to net charge-offs of $1.74 million, or 0.27%, of annualized average loans for the same period in 2024. 
• The allowance for credit losses to total loans was 1.42% at March 31, 2025, compared to 1.44% at December 31, 2024 and 1.41% at March 31, 2024. 
• Book value per share at March 31, 2025, was $ 27.09, a decrease of $1.64 from year-end 2024.  The decrease is primarily attributable to the payment of the special cash dividend in the first quarter of 2025 of $2.07 per share totaling approximately $37.93 million.

Non-GAAP Financial Measures

In addition to financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses certain non-GAAP financial measures that provide useful information for financial and operational decision making, evaluating trends, and comparing financial results to other financial institutions. The non-GAAP financial measures presented in this news release include “tangible book value per common share,” “return on average tangible common equity,” “adjusted earnings,” “adjusted diluted earnings per share,” “adjusted return on average assets,” “adjusted return on average common equity,” “adjusted return on average tangible common equity,” and certain financial measures presented on a fully taxable equivalent (“FTE”) basis. FTE basis is calculated using the federal statutory income tax rate of 21%.  Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as a reconciliation to that comparable GAAP financial measure can be found in the attached tables to this press release.  While the Company believes certain non-GAAP financial measures enhance the understanding of its business and performance, they are supplemental and not a substitute for, or more important than, financial measures prepared in accordance with GAAP and may not be comparable to those reported by other financial institutions.

About First Community Bankshares, Inc.

First Community Bankshares, Inc., a financial holding company headquartered in Bluefield, Virginia, provides banking products and services through its wholly owned subsidiary First Community Bank. First Community Bank operated 53 branch banking locations in Virginia, West Virginia, North Carolina, and Tennessee as of March 31, 2025. First Community Bank offers wealth management and investment advice and services through its Trust Division and through its wholly owned subsidiary, First Community Wealth Management, which collectively managed and administered $1.62 billion in combined assets as of March 31, 2025. The Company reported consolidated assets of $3.23 billion as of March 31, 2025. The Company’s common stock is listed on the NASDAQ Global Select Market under the trading symbol, “FCBC”. Additional investor information is available on the Company’s website at www.firstcommunitybank.com.

This news release may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual results may differ materially. These risks include: changes in business or other market conditions; the timely development, production and acceptance of new products and services; the challenge of managing asset/liability levels; the management of credit risk and interest rate risk; the difficulty of keeping expense growth at modest levels while increasing revenues; changes in banking laws and regulations; the degree of competition by traditional and non-traditional competitors; the impact of natural disasters, extreme weather events, military conflict , terrorism or other geopolitical events; and other risks detailed from time to time in the Company’s Securities and Exchange Commission reports including, but not limited to, the Annual Report on Form 10-K for the most recent fiscal year end. Pursuant to the Private Securities Litigation Reform Act of 1995, the Company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
		Three Months Ended
		March 31, 2025				December 31, 2024				September 30, 2024				June 30, 2024				March 31, 2024
(Amounts in thousands, except share and per share data)
Interest income
Interest and fees on loans		$	30,669			$	31,637			$	32,120			$	32,696			$	33,418
Interest on securities			1,238				1,447				1,070				1,211				1,698
Interest on deposits in banks			3,262				3,348				3,702				2,882				913
Total interest income			35,169				36,432				36,892				36,789				36,029
Interest expense
Interest on deposits			4,871				5,099				5,298				4,877				4,365
Interest on borrowings			-				-				-				-				35
Total interest expense			4,871				5,099				5,298				4,877				4,400
Net interest income			30,298				31,333				31,594				31,912				31,629
Provision for credit losses			321				1,082				1,360				144				1,011
Net interest income after provision			29,977				30,251				30,234				31,768				30,618
Noninterest income			10,229				10,337				10,452				9,342				9,259
Noninterest expense			24,944				24,107				24,177				24,897				23,386
Income before income taxes			15,262				16,481				16,509				16,213				16,491
Income tax expense			3,444				3,441				3,476				3,527				3,646
Net income		$	11,818			$	13,040			$	13,033			$	12,686			$	12,845
Earnings per common share
Basic		$	0.64			$	0.71			$	0.71			$	0.69			$	0.70
Diluted		$	0.64			$	0.71			$	0.71			$	0.71			$	0.71
Cash dividends per common share
Regular			0.31				0.31				0.31				0.29				0.29
Special cash dividend			2.07				-				-				-				-
Weighted average shares outstanding
Basic			18,324,760				18,299,612				18,279,612				18,343,958				18,476,128
Diluted			18,451,321				18,418,441				18,371,907				18,409,876				18,545,910
Performance ratios
Return on average assets			1.49	%			1.60	%			1.60	%			1.58	%			1.60	%
Return on average common equity			9.49	%			9.89	%			10.04	%			10.02	%			10.18	%
Return on average tangible common equity(1)			13.79	%			14.12	%			14.46	%			14.54	%			14.82	%

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(1	)	A non-GAAP financial measure defined as net income divided by average stockholders' equity less average goodwill and other intangible assets.

CONDENSED CONSOLIDATED QUARTERLY NONINTEREST INCOME AND EXPENSE  (Unaudited)
		Three Months Ended
		March 31, 2025				December 31, 2024				September 30, 2024				June 30, 2024				March 31, 2024
(Amounts in thousands)
Noninterest income
Wealth management		$	1,162			$	1,251			$	1,071			$	1,064			$	1,099
Service charges on deposits			3,836				3,613				3,661				3,428				3,310
Other service charges and fees			3,340				3,575				3,697				3,670				3,450
Other operating income			1,891				1,898				2,023				1,180				1,400
Total noninterest income		$	10,229			$	10,337			$	10,452			$	9,342			$	9,259
Noninterest expense
Salaries and employee benefits		$	13,335			$	13,501			$	13,129			$	12,491			$	12,581
Occupancy expense			1,576				1,329				1,270				1,309				1,378
Furniture and equipment expense			1,575				1,562				1,574				1,687				1,545
Service fees			2,484				2,305				2,461				2,427				2,449
Advertising and public relations			1,055				1,165				967				933				796
Professional fees			372				295				221				330				372
Amortization of intangibles			524				535				536				530				530
FDIC premiums and assessments			362				365				365				364				369
Litigation expense			-				-				-				1,800				-
Other operating expense			3,661				3,050				3,654				3,026				3,366
Total noninterest expense		$	24,944			$	24,107			$	24,177			$	24,897			$	23,386

RECONCILIATION OF GAAP NET INCOME TO NON-GAAP ADJUSTED EARNINGS (Unaudited)
		Three Months Ended
		March 31, 2025				December 31, 2024				September 30, 2024				June 30, 2024				March 31, 2024
(Amounts in thousands, except per share data)
Adjusted Net Income for diluted earnings per share		$	11,818			$	13,040			$	13,033			$	12,686			$	12,845
Non-GAAP adjustments:
Loss (gain) on sale of securities			-				-				-				-				-
Merger expense			-				-				-				-				-
Day 2 provision for allowance for credit losses - Surrey			-				-				-				-				-
Litigation expense			-				-				-				1,800				-
Other items(1)			-				-				(825	)			-				-
Total adjustments			-				-				(825	)			1,800				-
Tax effect			-				-				(198	)			432				-
Adjusted earnings, non-GAAP		$	11,818			$	13,040			$	12,406			$	14,054			$	12,845
Adjusted diluted earnings per common share, non-GAAP		$	0.64			$	0.71			$	0.68			$	0.76			$	0.69
Performance ratios, non-GAAP
Adjusted return on average assets			1.49	%			1.60	%			1.53	%			1.75	%			1.60	%
Adjusted return on average common equity			9.49	%			9.89	%			9.56	%			11.10	%			10.18	%
Adjusted return on average tangible common equity (2)			13.79	%			14.12	%			13.77	%			16.11	%			14.82	%

_____________

(1	)	Includes other non-recurring income and expense items.
(2	)	A non-GAAP financial measure defined as adjusted earnings divided by average stockholders' equity less average goodwill and other intangible assets.

AVERAGE BALANCE SHEETS AND NET INTEREST INCOME ANALYSIS (Unaudited)
		Three Months Ended March 31,
		2025												2024
		Average								Average Yield/				Average								Average Yield/
(Amounts in thousands)		Balance				Interest(1)				Rate(1)				Balance				Interest(1)				Rate(1)
Assets
Earning assets
Loans(2)(3)		$	2,395,068			$	30,757				5.21	%		$	2,549,107			$	33,500				5.29	%
Securities available for sale			149,266				1,261				3.43	%			239,010				1,731				2.91	%
Interest-bearing deposits			295,939				3,262				4.47	%			66,483				916				5.54	%
Total earning assets			2,840,273				35,280				5.04	%			2,854,600				36,147				5.09	%
Other assets			373,791												373,614
Total assets		$	3,214,064											$	3,228,214
Liabilities and stockholders' equity
Interest-bearing deposits
Demand deposits		$	658,651			$	180				0.11	%		$	665,875			$	162				0.10	%
Savings deposits			891,148				3,311				1.51	%			866,084				3,412				1.58	%
Time deposits			238,254				1,380				2.35	%			249,974				790				1.27	%
Total interest-bearing deposits			1,788,053				4,871				1.10	%			1,781,933				4,364				0.98	%
Borrowings
Federal funds purchased			-				-				-				2,527				35				5.52	%
Retail repurchase agreements			1,071				-				0.06	%			1,127				-				0.05	%
Total borrowings			1,071				-				0.06	%			3,654				35				3.85	%
Total interest-bearing liabilities			1,789,124				4,871				1.10	%			1,785,587				4,399				0.99	%
Noninterest-bearing demand deposits			859,988												886,947
Other liabilities			60,167												48,298
Total liabilities			2,709,279												2,720,832
Stockholders' equity			504,785												507,382
Total liabilities and stockholders' equity		$	3,214,064											$	3,228,214
Net interest income, FTE(1)						$	30,409											$	31,748
Net interest rate spread											3.94	%											4.10	%
Net interest margin, FTE(1)											4.34	%											4.47	%

_____________

(1	)	Interest income and average yield/rate are presented on a FTE, non-GAAP, basis using the federal statutory income tax rate of 21%.
(2	)	Nonaccrual loans are included in the average balance; however, no related interest income is recorded during the period of nonaccrual.
(3	)	Interest on loans includes non-cash and accelerated purchase accounting accretion of $556 thousand and $781 thousand for the three months ended March 31, 2025 and 2024, respectively.

CONDENSED CONSOLIDATED QUARTERLY BALANCE SHEETS (Unaudited)
		March 31, 2025				December 31, 2024				September 30, 2024				June 30, 2024				March 31, 2024
(Amounts in thousands, except per share data)
Assets
Cash and cash equivalents		$	414,682			$	377,454			$	315,338			$	329,877			$	248,905
Debt securities available for sale, at fair value			129,659				169,849				166,669				129,686				166,247
Loans held for investment, net of unearned income			2,382,699				2,416,089				2,444,113				2,473,268				2,519,833
Allowance for credit losses			(33,784	)			(34,825	)			(35,118	)			(34,885	)			(35,461	)
Loans held for investment, net			2,348,915				2,381,264				2,408,995				2,438,383				2,484,372
Premises and equipment, net			48,780				48,735				49,654				50,528				51,333
Other real estate owned			298				521				346				100				374
Interest receivable			9,306				9,207				9,883				9,984				10,719
Goodwill			143,946				143,946				143,946				143,946				143,946
Other intangible assets			12,490				13,014				13,550				14,085				14,615
Other assets			117,697				117,226				115,980				116,230				115,470
Total assets		$	3,225,773			$	3,261,216			$	3,224,361			$	3,232,819			$	3,235,981
Liabilities
Deposits
Noninterest-bearing		$	893,794			$	883,499			$	869,723			$	889,462			$	902,396
Interest-bearing			1,790,683				1,807,748				1,789,530				1,787,810				1,779,819
Total deposits			2,684,477				2,691,247				2,659,253				2,677,272				2,682,215
Securities sold under agreements to repurchase			908				906				954				894				1,006
Interest, taxes, and other liabilities			43,971				42,671				43,460				45,769				45,816
Total liabilities			2,729,356				2,734,824				2,703,667				2,723,935				2,729,037
Stockholders' equity
Common stock			18,327				18,322				18,291				18,270				18,413
Additional paid-in capital			169,867				169,752				168,691				168,272				173,041
Retained earnings			317,728				349,489				342,121				334,756				327,389
Accumulated other comprehensive loss			(9,505	)			(11,171	)			(8,409	)			(12,414	)			(11,899	)
Total stockholders' equity			496,417				526,392				520,694				508,884				506,944
Total liabilities and stockholders' equity		$	3,225,773			$	3,261,216			$	3,224,361			$	3,232,819			$	3,235,981
Shares outstanding at period-end			18,326,657				18,321,795				18,290,938				18,270,273				18,413,088
Book value per common share		$	27.09			$	28.73			$	28.47			$	27.85			$	27.53
Tangible book value per common share(1)			18.55				20.16				19.86				19.20				18.92

_____________

(1	)	A non-GAAP financial measure defined as stockholders' equity less goodwill and other intangible assets, divided by shares outstanding.

SELECTED CREDIT QUALITY INFORMATION (Unaudited)
		March 31, 2025				December 31, 2024				September 30, 2024				June 30, 2024				March 31, 2024
(Amounts in thousands)
Allowance for Credit Losses
Balance at beginning of period:
Allowance for credit losses - loans		$	34,825			$	35,118			$	34,885			$	35,461			$	36,189
Allowance for credit losses - loan commitments			341				441				441				746				746
Total allowance for credit losses beginning of period			35,166				35,559				35,326				36,207				36,935
Provision for credit losses:
Provision for credit losses - loans			350				1,182				1,360				449				1,011
(Recovery of) provision for credit losses - loan commitments			(29	)			(100	)			-				(305	)			-
Total provision for credit losses - loans and loan commitments			321				1,082				1,360				144				1,011
Charge-offs			(1,998	)			(2,005	)			(1,799	)			(1,599	)			(2,448	)
Recoveries			607				530				672				574				709
Net (charge-offs) recoveries			(1,391	)			(1,475	)			(1,127	)			(1,025	)			(1,739	)
Balance at end of period:
Allowance for credit losses - loans			33,784				34,825				35,118				34,885				35,461
Allowance for credit losses - loan commitments			312				341				441				441				746
Ending balance		$	34,096			$	35,166			$	35,559			$	35,326			$	36,207
Nonperforming Assets
Nonaccrual loans		$	19,974			$	19,869			$	19,754			$	19,815			$	19,617
Accruing loans past due 90 days or more			117				149				176				19				30
Modified loans past due 90 days or more			125				135				-				-				-
Total nonperforming loans			20,216				20,153				19,930				19,834				19,647
OREO			298				521				346				100				374
Total nonperforming assets		$	20,514			$	20,674			$	20,276			$	19,934			$	20,021
Additional Information
Total modified loans		$	2,124			$	2,260			$	2,320			$	2,290			$	2,177
Asset Quality Ratios
Nonperforming loans to total loans			0.85	%			0.83	%			0.82	%			0.80	%			0.78	%
Nonperforming assets to total assets			0.64	%			0.63	%			0.63	%			0.62	%			0.62	%
Allowance for credit losses to nonperforming loans			167.12	%			172.80	%			176.21	%			175.88	%			180.49	%
Allowance for credit losses to total loans			1.42	%			1.44	%			1.44	%			1.41	%			1.41	%
Annualized net charge-offs (recoveries) to average loans			0.24	%			0.24	%			0.18	%			0.16	%			0.27	%

FOR MORE INFORMATION, CONTACT:

David D. Brown

(276) 326-9000

Source: First Community Bankshares, Inc. 2025 GlobeNewswire, Inc.