Jan. 26, 2023
Sioux Falls-based Pathward Financial Inc. raised its 2023 earnings guidance with the release of its first quarter earnings, saying its unique business model positions the company well for the rest of the year.
During the quarter, which ended Dec. 31, the company reported adjusted net income of $23.2 million, or 81 cents per share. Adjustments were made for the gain on the sale of names and trademarks, and expenses for rebranding related to the sale of the Meta name to the company formerly called Facebook. That’s compared with $24 million, or 78 cents per share, for the same time last year, when excluding the impact of the gain and expenses related to Meta.
“Pathward Financial performed well during the first fiscal quarter of 2023,” CEO Brett Pharr said in a statement.
“Commercial finance loans grew 7 percent compared to the prior year period, and credit quality across the portfolio remains strong. As we head into a potential recessionary environment, we are confident in our active collateral management and the quality of our loan portfolio.
Primarily as a result of the rising interest rate environment, Pathward raised its expected fiscal 2023 GAAP earnings per share to the range of $5.55 to $5.95. When adjusting for gain and expenses related to Meta, the company expects fiscal 2023 adjusted earnings per share to be in the range of $5.40 to $5.80.
Net interest income for the first quarter was $84.1 million, an increase of 17 percent from the same quarter a year ago. The increase mainly was attributable to increased yields and an improved earning asset mix.
The first quarter average outstanding balance of loans and leases decreased $182.1 million compared to the same quarter of the prior fiscal year, primarily because of a reduction in warehouse finance loans and the sales of the remaining community bank and student loan portfolios, partially offset by an increase in the commercial finance loans.
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