Camden National Q2 2025 Earnings Report

Camden National EPS Results

• Actual EPS: $0.89
• Consensus EPS: $1.12
• Beat/Miss: Missed by -$0.23
• One Year Ago EPS: N/A

Camden National Revenue Results

• Actual Revenue: $69.82 million
• Expected Revenue: $61.04 million
• Beat/Miss: Beat by +$8.77 million
• YoY Revenue Growth: N/A

Camden National Announcement Details

• Quarter: Q2 2025
• Date: 7/29/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, July 29, 2025
• Conference Call Time: 3:00PM ET

Camden National (NASDAQ:CAC) operates as the bank holding company for Camden National Bank that provides various commercial and consumer banking products and services for consumer, institutional, municipal, non-profit, and commercial customers in Maine, New Hampshire, and Massachusetts. The company accepts checking, savings, time, and brokered deposits, as well as deposits with the certificate of deposit account registry system. Its loan products include non-owner-occupied commercial estate loans, owner-occupied commercial real estate loans, unsecured fully-guaranteed commercial loans backed by the small business administration, loans secured by one-to four-family properties, and consumer and home equity loans. The company also provides brokerage and insurance services through its financial offerings consisting of college, retirement, estate planning, mutual funds, strategic asset management accounts, and variable and fixed annuities. Further, it offers a range of fiduciary and asset management, wealth management, investment management, financial planning, and trustee services. Camden National Corporation was founded in 1875 and is headquartered in Camden, Maine.

Camden National Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Strong quarterly earnings of $14.1 M net income and EPS of $0.83 GAAP ($15.2 M, $0.89 non-GAAP) with pretax pre-provision income rising 13% sequentially.
• Positive Sentiment: Early success from the Northway acquisition drove cost synergies and revenue growth, expanding tangible common equity to 6.77% and increasing tangible book value by 3%.
• Negative Sentiment: An unexpected bankruptcy of a $12 M syndicated commercial borrower led to a $6.9 M provision expense and a $6 M loan loss allowance, though overall credit metrics remain healthy.
• Positive Sentiment: Loan balances grew 1% with consumer and commercial gains, and a robust $150 M pipeline—up 40% sequentially—signals continued strong demand.
• Positive Sentiment: Fee income rose on fiduciary and brokerage fees up 16% year-over-year, while digital initiatives like Roundup and Zogo drove over 140,000 transactions and 13,000 learning activities in two months.

Presentation

[Operator]

Good day, and welcome to Camden National Corporation's Second Quarter twenty twenty five Earnings Conference Call. My name is Elliot, and I'll be your operator for today's call. All participants will be in listen only mode during today's presentation. Following the presentation, we will conduct a question and answer session. I'll now turn the call over to Renee Smith, Executive Vice President, Chief Experience and Marketing Officer.

[Renée Smyth, EVP & Chief Experience & Marketing Officer at Camden National Bank]

Thank you. Good afternoon, and welcome to Camden National Corporation's conference call for the 2025. Joining us this afternoon are members of Camden National Corporation's executive team, Simon Griffiths, President and Chief Executive Officer and Mike Archer, Executive Vice President and Chief Financial Officer. Please note that today's presentation contains forward looking statements and actual results could differ materially from what is discussed on today's call. Cautionary language regarding these forward looking statements is contained in our second quarter twenty twenty five earnings release issued this morning and in other reports we file with the SEC.

[Renée Smyth, EVP & Chief Experience & Marketing Officer at Camden National Bank]

All of these materials and public filings are available on our Investor Relations website at camdennational.bank. Camden National Corporation trades on the NASDAQ under the symbol CAC. In addition, today's presentation includes discussion of non GAAP financial measures. Any references to non GAAP financial measures are intended to provide meaningful insights and are reconciled with GAAP in our earnings release, which is also available on our Investor Relations website. I am pleased to introduce our host, President and CEO, Simon Griffith.

[Simon Griffiths, President & CEO at Camden National]

Good afternoon, everyone, and thank you, Renee. We appreciate you taking the time to join us today. We're pleased to report on our strong performance in our first full quarter as a unified organization following the acquisition of Northway Financial earlier this year, which bolstered our presence in the New Hampshire market. This quarter marked the beginning of unlocking the financial potential of our combined franchise with pretax pre provision income, excluding onetime merger related expenses rising 13% from the prior quarter. Earlier this morning, we reported strong quarterly earnings of $14,100,000 resulting in diluted earnings per share of $0.83 On a non GAAP basis, adjusted earnings were $15,200,000 or $0.89 per share.

[Simon Griffiths, President & CEO at Camden National]

Our strong quarterly earnings accretion continues to rebuild our capital levels following the completion of the Northway acquisition and to enhance shareholder value. This is evidenced by the expansion of a tangible common equity ratio to 6.77% at June 30 and a 3% increase in tangible book value during the second quarter, reaching $26.9 per share. These outstanding results reflect early success in realizing cost synergies from the Northway acquisition and the ability to drive solid revenue growth, underscoring the strategic value of the acquisition for all our constituents, customers, employees, communities and shareholders. Several of our key performance indicators continued to trend positively. Net interest margin expanded by an additional two basis points and our non GAAP efficiency ratio improved to 55.5%.

[Simon Griffiths, President & CEO at Camden National]

We believe these outcomes demonstrate that we are well positioned to sustain interest margin expansion and earnings growth through the 2025. As reported, one commercial borrower filed for bankruptcy during the second quarter, resulting in the need for additional provisioning on this loan. We are actively engaged with a small group of other lenders involved in this loan and anticipate resolution later this year. In a few minutes, Mike will provide more details on our provision and loan loss reserve levels for the second quarter. We remain confident in the overall health of our loan portfolio and that this is not a broader trend across our well diversified loan portfolio as evidenced by our continued strong asset quality metrics.

[Simon Griffiths, President & CEO at Camden National]

Our second quarter performance reflects the continued benefits of our strategic investments, both digital and talent focused across the organization along with the disciplined execution of proactive deposit gathering and management. While average deposits were down 1% on a linked quarter basis due to seasonal trends, we have seen encouraging growth more recently as the summer months are upon us. While average loans remained stable during the quarter, we grew ending loan balances in both the consumer and commercial businesses. Our commercial team remains highly engaged, leveraging strong, long standing relationships and increased visibility in the high growth markets of Southern New Hampshire and Maine. We're seeing consistent pipeline activity across our markets signaling strong demand and sustained momentum.

[Simon Griffiths, President & CEO at Camden National]

And at the same time, we remain firmly committed to our underwriting discipline. During the quarter, we achieved robust growth in home equity loan balances in our high yield savings account, which requires a consumer checking account helping us expand and deepen relationships. We also achieved significant success in growing and diversifying our fee revenue. Our fiduciary and brokerage fee income organically grew 16% year over year. Our growing wealth management team is realizing substantial operational efficiencies from its new platform, which was implemented last year.

[Simon Griffiths, President & CEO at Camden National]

We continue to see strong opportunities to expand our services within our existing customer base, particularly as we prioritize advice driven conversations and extend our treasury management services into the New Hampshire market. We continue to advance our innovation agenda with strategic investments to modernize our mobile app aimed at attracting and retaining a digitally savvy customer base. This quarter, we successfully launched both our Roundup feature and Zogo, a digital financial literacy program. The response has been strong. Within the first sixty days, customers completed over 140,000 Roundup transactions, automatically directing spare change into savings and charitable giving accounts and engaging in more than 13,000 learning activities through our financial education tool.

[Simon Griffiths, President & CEO at Camden National]

We are proud of our second quarter financial performance, reflects the dedication of our 700 plus United teammates and their unwavering focus on serving our customers and executing our strategy. Their efforts have fueled strong results and built momentum we expect to carry through the 2025 and beyond. We are well positioned to continue delivering exceptional outcomes and unlocking meaningful long term value for shareholders. With that, I'll hand over to Mike to provide some additional financial highlights regarding the quarter.

[Michael Archer, EVP & CFO at Camden National]

Thank you, Simon, and good afternoon, everyone. Our second quarter operating results gave us a first look at our earnings power as a larger organization. Having completed the acquisition of Northway Financial and much of our integration in the first quarter of this year. As we enter the second half of the year, I'm pleased to report that we remain on track to deliver the financial targets outlined as part of the acquisition, including achieving our targeted cost reductions. For the second quarter, we reported GAAP net income of $14,100,000 and diluted earnings per share of $0.83 representing increases of 9293% respectively over the previous quarter.

[Michael Archer, EVP & CFO at Camden National]

On a non GAAP basis, pretax pre provision net income excluding M and A related costs totaled $26,100,000 for the second quarter and increased 13 over the previous quarter. This increase highlights the improvement in our efficiency ratio during the second quarter, which reached 55.5%, our lowest level since the 2022. Total revenues for the second quarter grew 4% over the last quarter to $62,300,000 driven by both net interest income and non interest income growth. Net interest margin and non GAAP core net interest margin each expanded two basis points during the second quarter to 3.062.7%, respectively. We continue to focus on driving core interest margin expansion and anticipate further expansion in the third quarter as we'll benefit from seasonal deposit flows and continued steady expansion of our earning asset yield.

[Michael Archer, EVP & CFO at Camden National]

Non interest income reached $13,100,000 for the second quarter, which beat our guidance provided last quarter. We are currently estimating a range for non interest income for the third quarter of 12,000,000 to $13,000,000 Reported non interest expense for the second quarter was $37,600,000 which was 15% lower than the first quarter. Non interest expense excluding M and A costs for the second quarter was $36,200,000 a 2% decrease compared to the prior quarter. For the third quarter, we currently anticipate non interest expenses excluding M and A costs and CDI amortization to land closer to $34,000,000 as we realized a full quarter of cost synergy savings from the Northway acquisition. Weighing on our reported financial results for the second quarter were elevated provision expenses of 6,900,000.0 During the second quarter, a borrower under a syndicated loan in which Camden

[Operator]

Ladies and gentlemen, we have lost connection with our speaker. Thank you for your patience as we reconnect them. One.

[Michael Archer, EVP & CFO at Camden National]

This is Mike. Sorry for the disconnection there. We'll we'll jump back into the the meeting here. Weighing on reported financial results for the second quarter were elevated provision expenses of 6,900,000.0. During the second quarter, a borrower under our syndicated loan in which Camden's participation totaled $12,000,000 entered bankruptcy, and we placed the loan on nonaccrual status.

[Michael Archer, EVP & CFO at Camden National]

As of June 30, we carried an allowance on this credit of 6,000,000 which represents our best estimate of the potential loss as of the end of the second quarter. This credit was a driver of the elevated provision expense and the increase in our allowance coverage ratio of 12 basis points during the second quarter to 1.08% at June 30. As noted in our earnings release earlier today, we currently anticipate that this credit will be fully resolved later this year. Overall, our credit trends across the broader loan portfolio remain very strong. Past due loans accounted for eight basis points of total loans at June 30, net charge offs were two basis points of average loans for the second quarter and non performing loans were 37 basis points of total loans at June 30.

[Michael Archer, EVP & CFO at Camden National]

We experienced nice loan growth during the quarter of 1% coming primarily from commercial and home equity loans. Our loan pipelines were robust at June 30 with $150,000,000 committed loan pipeline, representing a 40% increase over last quarter. Lastly, our capital position remains very strong, supported by growing ratios as we rebuild capital following the Northway acquisition earlier this year. Our TCE ratio grew to 6.77% at June 30, an increase of 28 basis points from the previous quarter. And our regulatory capital ratios continue to be well in excess of requirements and continue to build as well.

[Michael Archer, EVP & CFO at Camden National]

We anticipate strong capital generation in the second half of the year, driven by the full realization of synergies and sustained revenue growth. This concludes our comments. We'll now open up the call for questions.

[Operator]

Thank you. Our first question comes from Steve Moss with Raymond James. Your line is open. Please go ahead.

[Steve Moss, Director at Raymond James Financial]

Afternoon, guys.

[Steve Moss, Director at Raymond James Financial]

Maybe just starting here on the credit front. Hey, Mike. Just starting on the credit front here, just curious what type of C and I loan was it? And did the placement on non accrual here this quarter also impact, net interest income?

[Michael Archer, EVP & CFO at Camden National]

Yeah. So that was one of our just C and I loans. It was the syndication fee. You know, as as mentioned in the comments, we're we're working with a small group of of other vendors on that. And, certainly, you know, our our credit team is working very closely and diligently, trying to work through the resolution there.

[Michael Archer, EVP & CFO at Camden National]

And and as we mentioned, we do anticipate that the full resolution here a little bit later this year. It did impact net interest income, for the quarter. Overall, it was about a basis point of net interest margin, core margin, for the quarter.

[Steve Moss, Director at Raymond James Financial]

Okay. I'm sorry, maybe I should have been more specific. Just curious as to like what kind of industry the borrower active in.

[Simon Griffiths, President & CEO at Camden National]

Steve, yes, I'd characterize it as a service company.

[Steve Moss, Director at Raymond James Financial]

Okay. Got you. And then in terms of the loan pipeline here, just curious the color around the drivers of the improvement in the pipeline and kind of what's the coupon you're seeing on new originations?

[Simon Griffiths, President & CEO at Camden National]

Yeah. I'll take that, Steve. And just talking just to go back a click here, I think, obviously, we've mentioned the one loan. But I think we still feel very confident around our credit position. And, you know, when you look at non accruals of 15 basis points have absent that loan, it really is flat quarter over quarter.

[Simon Griffiths, President & CEO at Camden National]

So we feel very good about that. And, you know, as we push into this quarter, we are seeing a pickup. You know, particularly on the commercial side, we're seeing a lot of activity. We're also seeing some great results in the home equity front. We grew $16,700,000 in the second quarter in balances as compared to $18,000,000 all of last year.

[Simon Griffiths, President & CEO at Camden National]

So that's very positive momentum there, which I think is is really good to see. So, you know, we're seeing a nice balance across C and I, small loans, business loans. Mortgage is actually quite quite resilient as well. So it's a it's a broad based sort of pickup. And, you know, we certainly as we say, we've got a very, very positive pipeline.

[Steve Moss, Director at Raymond James Financial]

Okay. Got you. And in terms of the margin expansion here, just kind of thinking about the asset repricing, obviously, originations help here too. If you think about it as a couple of basis points quarter, just kind of curious how you guys are thinking about that dynamic.

[Simon Griffiths, President & CEO at Camden National]

I'll just say, Steve, I think, you know, we do see continued momentum back end of this year, obviously contingent, you know, in terms of the Fed, but we see, you know, plusminus five, ten basis points, for the next quarter, depending obviously on where the Fed goes.

[Steve Moss, Director at Raymond James Financial]

Okay. Great. Appreciate all the color. I'll step back in the queue.

[Simon Griffiths, President & CEO at Camden National]

Thanks, We

[Operator]

now turn to Matthew Breese with Stephens. Your line is open. Please go ahead.

[Matt Breese, Managing Director at Stephens Inc]

Good afternoon. Just on the C and I credit, a couple from me here. You know, you noted you're actively involved with other lenders on the note. Can you give us some sense for the ultimate size of this loan? And then what is your exposure, you know, overall with syndicated loans?

[Simon Griffiths, President & CEO at Camden National]

So our total exposure, Matt, is, 12,000,000 at quarter end. You know, I can certainly say there are five or six other banks in this group, and total exposure for the, is around the 200,000,000 mark.

[Michael Archer, EVP & CFO at Camden National]

Just in terms of unfunded there, Matt, there's a small piece of remaining exposure out there. I think it's around $1,000,000 or so, maybe a little bit over, but it's in that neighborhood.

[Matt Breese, Managing Director at Stephens Inc]

And the 200,000,000, are those you know, how would you characterize those in terms of, you know, geography? Are they mostly local, or are they national? What kind of broadly speaking, what kind of businesses are they attached to?

[Simon Griffiths, President & CEO at Camden National]

It's a mix, you know, from from national to to to to large regional local.

[Matt Breese, Managing Director at Stephens Inc]

And there's no other sign deterioration in the broader book?

[Simon Griffiths, President & CEO at Camden National]

No. No. We we very good. I mean, again, just coming back to my earlier points, Matt, you know, non accruals are 15 basis points of I mean, you know, that's that's pretty much flat quarter over quarter. Delinquencies are eight basis points up one basis point from Q1.

[Simon Griffiths, President & CEO at Camden National]

Charge offs are two basis points annualized. We feel very good about the overall book, but inevitably, sometimes you have these one off situations, and that's exactly what this is.

[Matt Breese, Managing Director at Stephens Inc]

Understood. Got it. Okay. Mike, you've mentioned a couple of guidance items. Was hoping to kick the tires on.

[Matt Breese, Managing Director at Stephens Inc]

The first one was just fee income of 12,000,000 to $13,000,000 next quarter, a little bit of a pullback. And I'm curious as to where we might see that pullback occur.

[Michael Archer, EVP & CFO at Camden National]

Yes. A couple of good question, Matt. A couple of things in there. One, just on the mortgage side, there is some fair value accounting that's giving a bit of a pop, if you will, on just the pipeline loans you know, at quarter end. The other item is within the BOLI.

[Michael Archer, EVP & CFO at Camden National]

You you would have seen a pop there as well. And and, you know, obviously, just with the the the acquisition, some different securities supporting one of the underlying bully policies that, you know, is more tied to the equity markets and just has has more volatility as you can imagine in some of that. So a little bit that's a little bit of my my caution out there. That said, I think mortgage will be strong from a sales perspective this this go around. I think we pegged that somewhere in the 750,000 to a million, so that could be, you know, pretty stable.

[Michael Archer, EVP & CFO at Camden National]

My hope would be we'd be in the 12 and a half to 13, kind of more in that range. But there's a couple items out there that are little less in our control, if you will, from a valuation perspective.

[Matt Breese, Managing Director at Stephens Inc]

Got it. Okay. And then on expenses, I I think you had said 34,000,000 to 35,000,000 for the rest of the year. At that point, at year end, have you kind of done all you can from from Northway, and should we expect a little bit of growth from the year end figure, whether it's 34 or 35? Just just trying to get some sense for the inflection point on expenses at year end.

[Michael Archer, EVP & CFO at Camden National]

Yeah. I mean, so we're we're targeting something closer to 34,000,000 for the third quarter, Matt. You know, we anticipate that we'll, you know, have the certainly the high majority, vast majority of the cost synergies by that point. There could be some items that continue to fall out there, but certainly the, you know, the material significant items would have gained most of that benefit as we, you know, closed down the third quarter possibly into the early fourth. But, you know, all things all things considered, I do think we'll we'll see the most of that in the third quarter.

[Michael Archer, EVP & CFO at Camden National]

There's a little bit of lumpiness just in the second quarter that is in our numbers in terms of some of the expenses. We just have annual equity grants for for board members, directors that, you flush know, through. And so it's a little bit higher than maybe you would have otherwise expected. But that, again, that's just more of a seasonality factor, and and something that we've always had.

[Matt Breese, Managing Director at Stephens Inc]

Understood. Okay. Yeah. Simon, just just on the credit piece, the stock is down 11% today. It feels like it's it's mostly tied to the increase in non accruals and a bit of a mismatch, you know, between, you know, your commentary today. So just curious if if if if the stock kind of stays here, would you be interested in the buyback, you know, as soon as the window opens up? That's all I had. Thank you.

[Simon Griffiths, President & CEO at Camden National]

Yeah. I mean, certainly, you know, I think in the in the context of the credit and the comments, you know, I think, you know, we're very well positioned for the second half of the year. You I think we see a lot of positives. We're starting to really see the traction, which we hope for with the New Hampshire franchise. We're certainly picking up a lot of the momentum in the commercial volume in New Hampshire, which I think is, is is really is really positive.

[Simon Griffiths, President & CEO at Camden National]

You know, we have a buyback open, and there's an option for us, if that makes sense. So certainly, that optionality is there. You know, we certainly feel very good about the core kind of net interest margin as we've talked about, and I think the the continued focus on the team with a trajectory to to to focusing on getting to 3%, I think, is certainly something the team are very committed to. So I think that's a a real positive for us. We've got cost discipline, I think, in place and really landing, the commitments we made around the integration.

[Simon Griffiths, President & CEO at Camden National]

So you put all those pieces together. I think the back half the year is looks very positive. You know, it and, you know, we're we're we're excited as a management team to continue to execute, on the the integration and opening up the markets in New Hampshire and and, obviously, the organic growth we have in the the main markets.

[Matt Breese, Managing Director at Stephens Inc]

I'll leave it there. Appreciate taking all my questions. Thank you.

[Operator]

We now turn to Damon DelMonte with KBW. Your line is open. Please go ahead.

[Matthew Renck, AVP at Keefe, Bruyette & Woods (KBW)]

Hey, everybody. This is Matt Rank filling in for Damon DelMonte. I hope everybody is doing okay today. I don't know what that noise was, but just as a follow-up on the fee income side of things. Just kinda hoping to see how early wealth management conversations are going in New Hampshire and what do you think that business and franchise could maybe grow to over the next year?

[Simon Griffiths, President & CEO at Camden National]

Yeah. I think it's you know, we've added, particularly in the main footprint, we've added a couple of wealth folk. So we see, you know, that potential. We're certainly investing into our core market where we've got strong relationships and certainly continuing to build that out and and seeing some very nice growth both within our brokerage business but also with our wealth franchise. You know, we've suddenly got started to take a, you know, step into the New Hampshire market.

[Simon Griffiths, President & CEO at Camden National]

We're certainly right now focused more on the lending side, the commercial. You know, as I said earlier, my earlier comments, very positive results. Home equity, of course, is, you know, as I as I talked about, we're seeing a lot of traction there, which is exciting. That wasn't a product that the, Northway team had. So that's, I think, bringing a real asset to to our customers.

[Simon Griffiths, President & CEO at Camden National]

And with those loans, we're bringing we're bringing in deposits as well and seeing a lot of traction on that side. So, So I think that helps the funding side, which is real positive. So I think the sort of the wealth picture for us is really probably more as we build into next year, but certainly going to continue to invest and have the potential, I think, some very attractive markets there to continue to build out the wealth team. That's not a this year thing. Think that's next year thing.

[Matthew Renck, AVP at Keefe, Bruyette & Woods (KBW)]

Okay. Got it. And then just one follow-up. You mentioned a new wealth platform, new mobile app. Was just curious if you're investing in any other technologies that you think could drive efficiencies or maybe revenue generation opportunities. Thanks.

[Simon Griffiths, President & CEO at Camden National]

Yeah. We you know, thanks for the question. And, certainly, that has gone well. And and the team, I think the wealth team feel very good about both the operational efficiencies, but also the improved customer experience from the mobile app. So that's just sort of very real positive.

[Simon Griffiths, President & CEO at Camden National]

As you you know, from previous calls, we talked about the Terrafina platform, the new online account opening platform has been very positive. We're seeing a lot of traction there. Just under 10% now of our accounts are coming in through that platform, which is which is really positive, and and I think a great customer experience. We'll continue to leverage that platform and build that platform out. We've also had some great innovations recently.

[Simon Griffiths, President & CEO at Camden National]

We've rolled out some fabulous new innovations around Roundup, Roundup to save, Roundup to donate. We're seeing a lot of energy and traction as I referenced in my comments, and, I think that's real possible as well as a learning platform and starting to see a lot of engagement from my younger customers around that. So I think it's a very digital forward strategy. We've got other pieces in the pipeline, which we're not ready to talk about. But I think, you know, when you start to put all these pieces together, I think it's driving engagement, driving, account acquisition, which, of course, is gonna be crucial to funding and just the overall health and growth of the banks.

[Simon Griffiths, President & CEO at Camden National]

I feel very good about the digital strategy and the momentum that we have.

[Matthew Renck, AVP at Keefe, Bruyette & Woods (KBW)]

Great. Thank you. I'll step back.

[Operator]

We have no further questions, so I'll now hand back to Simon Griffiths for any final remarks.

[Simon Griffiths, President & CEO at Camden National]

Thank you for your time today and your continued interest in Canada National Corporation. We appreciate your support and wish you a productive and, restful summer. Thanks, everyone.

[Operator]

Ladies and gentlemen, today's call has now concluded. We'd like to thank you for your participation. You may now disconnect your lines.

Participants

Executives

• Renée Smyth, EVP & Chief Experience & Marketing Officer
• Simon Griffiths, President & CEO
• Michael Archer, EVP & CFO

Analysts

• Steve Moss, Director at Raymond James Financial
• Matt Breese, Managing Director at Stephens Inc
• Matthew Renck, AVP at Keefe, Bruyette & Woods (KBW)