Simmons First 3Q Earnings Down 19% But Beat Expectations

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Simmons First National Corp. of Pine Bluff on Monday reported third-quarter earnings of $65.9 million, down 19% from the same quarter last year.

The publicly traded financial holding company (Nasdaq: SFNC) reported earnings of 60 cents per share. Adjusted for one-time gains and costs, earnings were 63 cents per share, which beat Wall Street expectations of 42 cents per share — the average estimate of five analysts surveyed by Zacks Investment Research.

The company said revenue was $251.6 million. Revenue net of interest expense was $225.5 million, which beat analysts’ expectations of $206 million.

“We are very proud of our results under these trying conditions,” Chairman and CEO George A. Makris Jr. said in a news release. “We have experienced very meaningful shifts in consumer habits which we believe will impact our delivery of products and services as well as the retail delivery of everyday amenities. Our investment in digital channels will continue to position our company for these changes and our associates are ready for the new normal.”

The company, saying that it continually evaluating its branch network, said it closed 11 branches during the second quarter, saving an estimated $2.4 million per year. It closed another 23 branches on Oct. 9, saving about $6.7 million per year.

Total loans were $14 billion as of Sept. 30, up 7.8% from the same time last year, mainly because it completed its merger with The Landrum Co. during the fourth quarter of 2019. On a consecutive quarter basis, total loans decreased $589.5 million, or 4.0%, with the largest decrease in the real estate loan portfolios. 

“Loan demand is very weak in almost every aspect of our commercial economy,” Makris noted.

Through Sept. 30, Simmons originated about 8,200 loans under the Paycheck Protection Program, with an average balance of $118,000 per loan. About 93% of the PPP loans had a balance less than $350,000 as of Sept. 30.

Simmons reported an efficiency ratio of 54.12% compared to 42.77% in the same quarter last year. It has total assets of $21.8 billion.

Simmons First National shares have dropped 36% since the beginning of the year. The stock has fallen 27% in the last 12 months.

(The Associated Press contributed to this report.)