Quarterly net income dips, revenue rises for Home BancShares

Home BancShares posted a small dip in net income in the first quarter, but earnings per share of 50 cents beat the consensus estimate of 45 cents and interest income was up 11.2% thanks to higher interest rates.

The Conway-based bank, which is the parent company of Centennial Bank, on Thursday (April 18) reported first quarter net income of $100.109 million, just below the $102.962 million in the same period of 2023. Total revenue in the quarter was $264.389 million, up 6.3% compared with revenue in the same period of 2023.

Part of the revenue growth was driven by higher interest rates. The interest income in the quarter was $316.915 million, up 11.2% compared with $284.939 million in the same period of 2023.

“I’m always looking for improvement, but if the next three quarters show positive trends such as this quarter did, I think HOMB is poised for a great year,” Home BancShares Chairman and CEO John Allison said in the earnings report. “The period for January to March resulted in increases in net interest income, revenue, EPS, margin (when adjusting for excess liquidity), loans and deposits along with strong liquidity while lowering our efficiency ratio. In addition, we reduced non-interest expense by $3 million, quarter over quarter. Any questions?”

The company said Centennial CFG, its commercial real estate loan division that has offices in Dallas, Los Angeles, Miami, and New York, reported the most loan growth in the quarter.

“During the first quarter of 2024, the Company experienced approximately $88.9 million in loan growth. Centennial CFG experienced $81.5 million of organic loan growth and had loans of $2.03 billion at March 31, 2024. Our remaining markets experienced $7.4 million in organic loan growth during the quarter,” the company noted in Thursday’s earnings report.

Troubled assets did rise in the quarter. Non-performing assets in the quarter totaled $110.696 million, well ahead of the $77.467 million in the same quarter of 2023.

Following are other financial items from the quarterly report.
• Total assets as of March 31 reached $22.835 billion, up from the $22.518 billion at the end of the first quarter in 2023.

• Total loans as of March 31 were $14.513 billion, up from the $14.386 billion at the end of the first quarter in 2023.

• Total deposits as of March 31 were $16.866 billion, down from the $17.445 billion at the end of the first quarter in 2023.

• The return on assets as of March 31 was 1.78%, down from 1.84% at the end of the first quarter in 2023.

Founded in 1999, Home BancShares has 76 branches in Arkansas, 78 branches in Florida, 63 branches in Texas, 5 branches in Alabama and one branch in New York City. Shares of Home BancShares (NASDAQ: HOMB) closed Wednesday at $22.40. During the past 52 weeks, the share price has ranged between $25.80 and $19.61.