PEOPLES BANCORP INC. Item 2.02 Results of Operations and Financial Condition
OnJanuary 24, 2023 , management ofPeoples Bancorp Inc. ("Peoples") conducted a facilitated conference call at approximately11:00 a.m., Eastern Standard Time , to discuss results of operations for the quarter and twelve months endedDecember 31, 2022 . A replay of the conference call audio will be available on Peoples' website, www.peoplesbancorp.com, in the "Investor Relations" section for one year. A copy of the transcript of the conference call is included as Exhibit 99.1 to this Current Report on Form 8-K. The information contained in this Item 2.02 and Exhibit 99.1 included with this Current Report on Form 8-K, is being furnished pursuant to Item 2.02 and shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as otherwise stated in such filing. During the conference call, management referred to non-Generally Accepted Accounting Principles ("US GAAP") financial measures that are used by management to provide information useful to investors in understanding Peoples' operating performance and trends, and to facilitate comparisons with the performance of Peoples' peers. The following tables show the differences between the non-US GAAP financial measures referred to during the conference call and the most directly comparable US GAAP-based financial measures. Three Months Ended Year Ended December 31, September 30, December 31, December 31, (Dollars in thousands) 2022 2022 2021 2022 2021 Core non-interest expense: Total non-interest expense$ 53,366 $
52,253
702 339 903 3016 21423
Less: pension settlement charges 46 139 0 185 143
Less: severance expenses 0 0 16 0 79
Less: COVID-19-related expenses 2 9 565 134 1248
Less: Peoples Bank Foundation, Inc. 0 0 0 0 500
contribution
Less: contract negotiation (refunds) - - (603) - 1,248 expenses Core non-interest expense$ 52,616 $ 51,766 $ 47,110 $ 203,812 $ 159,096
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Three Months Ended Year Ended
December 31, September 30, December 31, December 31,
(Dollars in thousands) 2022 2022 2021 2022 2021
Efficiency ratio:
Total non-interest expense $ 53,366 $ 52,253
1,998 2,023 1,508 7,763 4,775
Adjusted total non-interest expense 51,368 50,230 46,483 199,384 178,962
Total non-interest income 19,034 20,366 19,815 78,836 68,885
Add: net (loss) gain on investment
securities (168) 21 (158) (61) (862)
Add: net (loss) gain on asset
disposals and other transactions (302) (35) 952 (616) 493
Total non-interest income, excluding
net gains and losses 19,504 20,380 19,021 79,513 69,254
Net interest income 70,613 67,051 54,737 253,442 172,553
Add: fully tax-equivalent adjustment
(a) 412 387 379 1,644 1,349
Net interest income on a fully
tax-equivalent basis 71,025 67,438 55,116 255,086 173,902
Adjusted revenue $ 90,529 $ 87,818 $ 74,137 $ 334,599 $ 243,156
Efficiency ratio 56.74 % 57.20 % 62.70 % 59.59 % 73.60 %
Efficiency ratio adjusted for non-core items:
Core non-interest expense $ 52,616 $ 51,766
1,998 2,023 1,508 7,763 4,775
Adjusted core non-interest expense 50,618 49,743 45,602 196,049 154,321
Adjusted revenue $ 90,529 $ 87,818 $ 74,137 $ 334,599 $ 243,156
Efficiency ratio adjusted for
non-core items 55.91 % 56.64 % 61.51 % 58.59 % 63.47 %
(a) Tax effect is calculated using a 23.3% blended corporate income tax rate for
all periods in 2022 and 22.3% blended corporate income tax rate for the periods
in 2021.
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At or For the Three Months Ended
December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands, except per
share data) 2022 2022 2022 2022 2021
Tangible equity:
Total stockholders' equity $ 785,328 $ 760,511 $ 786,824 $ 808,340 $ 845,025
Less: goodwill and other
intangible assets 326,329 328,428 328,132 341,865 291,009
Tangible equity $ 458,999 $ 432,083 $ 458,692 $ 466,475 $ 554,016
Tangible assets:
Total assets $ 7,207,304 $ 7,005,854 $ 7,278,292 $ 7,239,261 $ 7,063,521
Less: goodwill and other
intangible assets 326,329 328,428 328,132 341,865 291,009
Tangible assets $ 6,880,975 $ 6,677,426 $ 6,950,160 $ 6,897,396 $ 6,772,512
Tangible book value per common
share:
Tangible equity $458,999 $432,083 $458,692 $466,475 $554,016
Common shares outstanding 28,287,837 28,278,078 28,290,115 28,453,175 28,297,771
Tangible book value per common
share $ 16.23 $ 15.28 Tangible equity to tangible assets ratio: Tangible equity$ 458,999 $ 432,083 $ 458,692 $ 466,475 $ 554,016 Tangible assets$ 6,880,975 $ 6,677,426 $ 6,950,160 $ 6,897,396 $ 6,772,512
Tangible equity to tangible
assets 6.67 % 6.47 % 6.60 % 6.76 % 8.18 %
Three Months Ended Year Ended
December 31, September 30, December 31, December 31,
(Dollars in thousands) 2022 2022 2021 2022 2021
Pre-provision net revenue:
Income before income taxes $ 33,980 $ 33,388
2,301 1,776 - - 731
Add: loss on OREO - 105 2 173 34
Add: loss on investment securities 321 - 556 375 2,046
Add: loss on other assets 530 - 27 975 714
Add: loss on other transactions 22 24 - 151 -
Less: recovery of credit losses - - 6,602 3,510 -
Less: gain on OREO - - 82 35 90
Less: gain on investment securities 153 - 398 314 1,184
Less: gain on other transactions - 21 903 - 897
Less: gain on other assets 251 94 204 649 462
Pre-provision net revenue $ 36,750 $ 35,178 $ 25,559 $ 125,807 $ 57,862
Total average assets 7,067,193 7,124,108 7,098,875 7,094,707 5,672,594
Pre-provision net revenue to total
average assets (annualized) 2.06 % 1.96 % 1.43 % 1.77 % 1.02 %
Weighted-average common shares
outstanding - diluted 27,981,656 27,973,255 28,114,980 27,999,602 21,959,883
Pre-provision net revenue per common
share - diluted $ 1.31 $ 1.25 $ 0.91 $ 4.48 $ 2.63 --------------------------------------------------------------------------------
Three Months Ended Year Ended
December 31, September 30, December 31, December 31,
(Dollars in thousands) 2022 2022 2021 2022 2021
Annualized net income adjusted for non-core items: Net income
$ 26,849 $
25,978
168 - 158 61 862
Less: tax effect of net loss on investment
securities (a) 35 - 33 13 181
Less: net gain on investment securities - 21 - - -
Add: tax effect of net gain on investment
securities (a) - 4 - - -
Add: net loss on asset disposals and other
transactions 301 35 - 615 -
Less: tax effect of net loss on asset
disposals and other transactions (a) 63 7 - 129 -
Less: net gain on asset disposals and other
transactions (a) - - 1,784 - 493
Add: tax effect of net gain on asset
disposals and other transactions (a) - - 375 - 104
Add: acquisition-related expenses 702 339 918 3,016 21,423
Less: tax effect of acquisition-related
expenses (a) 147 71 193 633 4,499
Add: severance expenses - - 16 - 79
Less: tax effect of severance expenses (a) - - 3 - 17
Add: pension settlement charges 46 139 - 185 143
Less: tax effect of pension settlement
charges (a) 10 29 - 39 30
Add: COVID-19-related expenses 2 9 565 134 1,248
Less: tax effect of COVID-19-related
. . .
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