Kraig Biocraft Laboratories Issues a Letter to Shareholders on Recent Advancements and Potential Recombinant Spider Silk Deliveries in 2025
We recently received inquiries from several of our shareholders. In preparing those responses, we realized that we should share the contents with the broader Kraig Labs community. Many had questions related to last week's announcement of the development of the new production strain and the potential for commercial deliveries in 2025.
The development of a new spider silk production transgenic has been a key part of our production roadmap since 2023 and a primary objective of our genetics team during the last 18 months. Our longstanding plans were to field a new strain of silkworm for our double hybrid production system in the Summer of 2025. To be frank, we were unsure whether we could meet that ambitious schedule. We were, therefore, ecstatic to announce that we created another world's first development on schedule. This and many of our other laboratory announcements are not only significant; they're foundational technology building blocks to our success.
Our current single hybrid system, utilizing BAM-1, has already shown massive improvement in robustness and silk production output. The newly announced strain is another significant improvement in our production, moving us a significant step closer to a more powerful double hybrid. The double hybrid model is designed to significantly improve our silk production rate; we expect by as much as 25+% per month, so this is something that we were very excited to share with our shareholders.
We are no longer experiencing the robustness challenges we faced with single-strain rearing. Before the rollout of the BAM-1 hybrid in 2024, our silkworms lacked the robustness to deal with the silkworm diseases and environmental stress that are frequently present in the field. In terms of robustness and disease tolerance, the BAM-1 appears to be on par with the Chinese commercial silk hybrid, which is the gold standard in that region for the production of mundane silk.
Now, this doesn't mean that we are invincible. Globally, between 10% to 30% of all silk production with robust double hybrids is lost due to a handful of diseases and adverse weather conditions. This is just a part of working with these living production systems. It is a fact that is reflected in global silk economics. Since rolling out the BAM-1, we have dealt with these routine challenges and have weathered these events with similar or identical effects as mundane silk producers utilizing the Chinese hybrid. Right now, the region's sericulture operators are in their rainy season, which is typically the worst time for silkworm rearing. Production of our BAM-1 strains and production of mundane silk producers utilizing Chinese hybrids are negatively impacted during this cycle. That is a normal part of silkworm rearing and is something that all silkworm producers encounter as a normal part of the business.
In the past, before we introduced BAM-1, the effects on our silkworms were significantly magnified and effectively stymied our growth. In short, there has been a revolution in our spider silk production technology over the past 14 months due to the introduction of BAM-1 and other improvements in the field and laboratory. As we meet our marks toward the initiation of the double hybrid, we anticipate our gains to accelerate further.
Regarding inventory calculation, our current inventory figures track finished raw reeled silk. In the first quarter of this year, we stockpiled several hundred kilograms of cocoon that are now waiting to be processed into finished silk. The reason inventory did not increase in our financial report was because that report tracked finished silk or material form. After considering these questions, and in light of the fact that we are moving from nominal inventory to larger scale production, we will expand the scope of our work-in-progress (WIP) material inventory to include recombinant spider silk cocoon that has been completed but not reeled. You can expect us to begin adding completed recombinant spider silk cocoon to our WIP to all future inventory balances.
We are 100% focused on the production of spider silk for commercial delivery. Over the last year, we've been able to move faster to deliver on that commitment. As a great example, we are in regular communication with three major Global brands that are standing by to receive their first shipments of materials. The first is an internationally renowned high-end luxury fashion brand that has already accepted a quote from Kraig Labs. The second is a world leader in high-end performance sportswear with an approved budget to buy silk from us. The third is one of the world's top 5 performance athletic equipment producers, looking for spider silk to integrate into their top-performing products. Supplying products to these three entities is the focus of our current production. Currently, we expect to begin deliveries to these customers in the second half of this year. That will be a significant milestone for Kraig Labs, our shareholders, and material science.
I believe the future for Kraig Labs and spider silk has never been brighter, and we thank you for your continued support.
Kim Thompson, CEO
For the latest updates on Kraig Labs and its pioneering spider silk technologies, visit www.kraiglabs.com.
For details about other recent Kraig Labs advancements, please watch the Company's investor conference at www.kraiglabs.com/videos or on the Company's YouTube Channel https://www.youtube.com/@kraigbiocraftlaboratories2270.
To view the most recent news from Kraig Labs and/or to sign up for Company alerts, please go to www.KraigLabs.com/news
* For a description of our historical leadership in this technology, please follow this link https://www.kraiglabs.com/world-leader/
About Kraig Biocraft Laboratories, Inc.
Kraig Biocraft Laboratories, Inc. (www.KraigLabs.com), a reporting biotechnology company is the leading developer of genetically engineered spider silk-based fiber technologies.
The Company has achieved a series of scientific breakthroughs in the area of spider silk technology with implications for the global textile industry.
Cautionary Statement Regarding Forward Looking Information
Statements in this press release about the Company's future and expectations other than historical facts are "forward-looking statements." These statements are made on the basis of management's current views and assumptions. As a result, there can be no assurance that management's expectations will necessarily come to pass. These forward-looking statements generally can be identified by phrases such as "believes," "plans," "expects," "anticipates," "foresees," "estimated," "hopes," "if," "develops," "researching," "research," "pilot," "potential," "could" or other words or phrases of similar import. Forward looking statements include descriptions of the Company's business strategy, outlook, objectives, plans, intentions and goals. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements. This press release does not constitute an offer to sell or the solicitation of an offer to buy any security.
Ben Hansel, Hansel Capital, Inc.(720) 288-8495ir@KraigLabs.com
A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/afaa22d8-7f0a-4fcb-b905-f58e42ddc46a
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Community Bank operates its branch network in southwestern Pennsylvania and West Virginia. Community Bank offers a broad array of retail and commercial lending and deposit services. For more information about CB Financial Services, Inc. and Community Bank, visit our website at Statement About Forward-Looking Statements Statements contained in this press release that are not historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 and such forward-looking statements are subject to significant risks and uncertainties. The Company intends such forward-looking statements to be covered by the safe harbor provisions contained in the Act. The Company's ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse effect on the operations and future prospects of the Company and its subsidiaries include, but are not limited to, general and local economic conditions, changes in market interest rates, deposit flows, demand for loans, real estate values and competition, competitive products and pricing, the ability of our customers to make scheduled loan payments, loan delinquency rates and trends, our ability to manage the risks involved in our business, our ability to control costs and expenses, inflation, market and monetary fluctuations, changes in federal and state legislation and regulation applicable to our business, actions by our competitors, and other factors that may be disclosed in the Company's periodic reports as filed with the Securities and Exchange Commission. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation. (Dollars in thousands, except share and per share data) (Unaudited) Three Months Ended Six Months Ended Interest and Dividend Income: Loans, Including Fees $ 15,492 $ 14,528 $ 14,930 $ 14,945 $ 14,670 $ 30,020 $ 29,508 Securities: Taxable 2,860 2,777 3,096 3,289 2,844 5,637 5,148 Dividends 9 28 27 28 27 37 54 Other Interest and Dividend Income 399 514 1,378 1,511 1,398 912 2,216 Total Interest and Dividend Income 18,760 17,847 19,431 19,773 18,939 36,606 36,926 Interest Expense: Deposits 5,721 6,111 7,492 7,892 7,065 11,833 13,056 Short-Term Borrowings 108 23 — — — 131 — Other Borrowings 391 402 407 407 404 792 808 Total Interest Expense 6,220 6,536 7,899 8,299 7,469 12,756 13,864 Net Interest and Dividend Income 12,540 11,311 11,532 11,474 11,470 23,850 23,062 (Recovery) Provision for Credit Losses - Loans (136 ) 68 483 25 12 (68 ) (130 ) Provision (Recovery) for Credit Losses - Unfunded Commitments 144 (108 ) 200 (66 ) (48 ) 36 57 Net Interest and Dividend Income After Net Provision (Recovery) for Credit Losses 12,532 11,351 10,849 11,515 11,506 23,882 23,135 Noninterest Income: Service Fees 559 462 460 451 354 1,021 769 Insurance Commissions 1 1 1 1 1 2 3 Other Commissions 66 63 63 104 22 129 84 Net Gain on Sales of Loans 26 22 3 18 9 49 30 Net (Loss) Gain on Securities — (69 ) 3 245 (31 ) (69 ) (197 ) Net Gain on Purchased Tax Credits 4 4 12 12 12 7 25 Gain on Sale of Subsidiary — — — 138 — — — Net Gain on Disposal of Premises and Equipment — — — — — — 274 Income from Bank-Owned Life Insurance 148 149 152 147 147 297 295 Net Gain on Bank-Owned Life Insurance Claims — — — — — — 915 Other Income 127 155 961 117 174 282 406 Total Noninterest Income 931 787 1,655 1,233 688 1,718 2,604 Noninterest Expense: Salaries and Employee Benefits 5,088 6,036 5,258 4,561 4,425 11,124 9,001 Occupancy 616 750 652 755 940 1,366 1,689 Equipment 372 330 313 280 298 702 562 Data Processing 761 797 832 772 1,011 1,558 1,703 Federal Deposit Insurance Corporation Assessment 203 176 172 177 161 379 290 Pennsylvania Shares Tax 143 257 301 265 297 400 595 Contracted Services 382 310 522 431 390 692 671 Legal and Professional Fees 117 262 268 297 208 378 420 Advertising 124 119 137 141 78 242 206 Other Real Estate Owned 1 — 34 2 37 2 14 Amortization of Intangible Assets — — 88 264 264 — 605 Other Expense 941 765 876 837 875 1,706 1,656 Total Noninterest Expense 8,748 9,802 9,453 8,782 8,984 18,549 17,412 Income Before Income Tax Expense 4,715 2,336 3,051 3,966 3,210 7,051 8,327 Income Tax Expense 766 427 522 747 560 1,193 1,480 Net Income $ 3,949 $ 1,909 $ 2,529 $ 3,219 $ 2,650 $ 5,858 $ 6,847 Expand Three Months Ended Six Months Ended Per Common Share Data 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 6/30/25 6/30/24 Dividends Per Common Share $ 0.25 $ 0.25 $ 0.25 $ 0.25 $ 0.25 $ 0.50 $ 0.50 Earnings Per Common Share - Basic 0.79 0.37 0.49 0.63 0.52 1.15 1.33 Earnings Per Common Share - Diluted 0.74 0.35 0.46 0.60 0.51 1.09 1.33 Weighted Average Common Shares Outstanding - Basic 5,022,813 5,125,577 5,126,782 5,137,586 5,142,139 5,073,911 5,136,021 Expand 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 Common Shares Outstanding 4,972,300 5,099,069 5,132,654 5,129,921 5,141,911 Book Value Per Common Share $ 29.84 $ 29.08 $ 28.71 $ 29.07 $ 27.79 Tangible Book Value per Common Share (1) 27.88 27.17 26.82 27.16 25.83 Stockholders' Equity to Assets 9.8 % 10.0 % 9.9 % 9.5 % 9.2 % Tangible Common Equity to Tangible Assets (1) 9.2 9.4 9.4 9.0 8.6 Expand Three Months Ended Six Months Ended Selected Financial Ratios (2) 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 6/30/25 6/30/24 Return on Average Assets 1.06 % 0.53 % 0.65 % 0.84 % 0.71 % 0.80 % 0.93 % Return on Average Equity 10.76 5.24 6.80 8.80 7.58 8.01 9.80 Average Interest-Earning Assets to Average Interest-Bearing Liabilities 135.33 134.70 133.33 133.26 135.69 135.02 136.36 Average Equity to Average Assets 9.88 10.07 9.63 9.54 9.36 9.97 9.54 Net Interest Rate Spread 2.91 2.61 2.41 2.36 2.44 2.76 2.55 Net Interest Rate Spread (FTE) (1) 2.93 2.63 2.42 2.38 2.46 2.78 2.56 Net Interest Margin 3.54 3.27 3.12 3.11 3.18 3.40 3.27 Net Interest Margin (FTE) (1) 3.55 3.28 3.13 3.12 3.19 3.42 3.28 Net Charge-Offs (Recoveries) to Average Loans (0.01 ) 0.02 0.06 0.03 0.02 — 0.01 Efficiency Ratio 64.94 81.02 71.68 69.11 73.89 72.55 67.84 Expand Asset Quality Ratios 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 Allowance for Credit Losses to Total Loans 0.88 % 0.90 % 0.90 % 0.89 % 0.88 % Allowance for Credit Losses to Nonperforming Loans (3) 550.20 414.48 548.07 463.07 513.03 Delinquent and Nonaccrual Loans to Total Loans (4) 0.49 0.54 0.72 0.98 0.53 Nonperforming Loans to Total Loans (3) 0.16 0.22 0.16 0.19 0.17 Nonperforming Assets to Total Assets (5) 0.13 0.16 0.12 0.14 0.13 Expand Capital Ratios (6) 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 Common Equity Tier 1 Capital (to Risk Weighted Assets) 15.28 % 14.94 % 14.78 % 14.79 % 14.62 % Tier 1 Capital (to Risk Weighted Assets) 15.28 14.94 14.78 14.79 14.62 Total Capital (to Risk Weighted Assets) 16.29 15.95 15.79 15.76 15.61 Tier 1 Leverage (to Adjusted Total Assets) 10.49 10.36 9.98 9.96 9.98 Expand (1) Refer to Explanation of Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure. (2) Interim period ratios are calculated on an annualized basis. (3) Nonperforming loans consist of all nonaccrual loans and accruing loans that are 90 days or more past due. (4) Delinquent loans consist of accruing loans that are 30 days or more past due. (5) Nonperforming assets consist of nonperforming loans and other real estate owned. (6) Capital ratios are for Community Bank only. Expand AVERAGE BALANCES AND YIELDS Three Months Ended June 30, 2025 March 31, 2025 December 31, 2024 September 30, 2024 June 30, 2024 (Dollars in thousands) (Unaudited) Assets: Interest-Earning Assets: Loans, Net (2) $ 1,098,698 $ 15,549 5.68 % $ 1,075,083 $ 14,584 5.50 % $ 1,066,304 $ 14,975 5.59 % $ 1,063,946 $ 14,987 5.60 % $ 1,076,455 $ 14,711 5.50 % Debt Securities Taxable 284,499 2,860 4.02 278,362 2,777 3.99 284,002 3,096 4.36 288,208 3,289 4.56 266,021 2,844 4.28 Equity Securities 1,000 9 3.60 2,674 28 4.19 2,693 27 4.01 2,693 28 4.16 2,693 27 4.01 Interest-Earning Deposits at Banks 33,564 331 3.94 45,056 459 4.07 114,245 1,338 4.68 111,131 1,448 5.21 101,277 1,313 5.19 Other Interest-Earning Assets 3,767 68 7.24 3,196 55 6.98 3,070 40 5.18 3,108 63 8.06 3,154 85 10.84 Total Interest-Earning Assets 1,421,528 18,817 5.31 1,404,371 17,903 5.17 1,470,314 19,476 5.27 1,469,086 19,815 5.37 1,449,600 18,980 5.27 Noninterest-Earning Assets 67,513 63,324 65,786 57,602 53,564 Total Assets $ 1,489,041 $ 1,467,695 $ 1,536,100 $ 1,526,688 $ 1,503,164 Liabilities and Stockholders' Equity: Interest-Bearing Liabilities: Interest-Bearing Demand Accounts $ 334,752 $ 1,677 2.01 % $ 317,799 $ 1,526 1.95 % $ 328,129 $ 1,838 2.23 % $ 316,301 $ 1,923 2.42 % $ 325,069 $ 1,858 2.30 % Money Market Accounts 238,195 1,747 2.94 230,634 1,726 3.04 227,606 1,821 3.18 217,148 1,726 3.16 214,690 1,646 3.08 Savings Accounts 174,055 42 0.10 172,322 41 0.10 170,612 45 0.10 175,753 46 0.10 184,944 52 0.11 Time Deposits 259,506 2,255 3.49 285,093 2,818 4.01 341,686 3,788 4.41 358,498 4,197 4.66 308,956 3,509 4.57 Total Interest-Bearing Deposits 1,006,508 5,721 2.28 1,005,848 6,111 2.46 1,068,033 7,492 2.79 1,067,700 7,892 2.94 1,033,659 7,065 2.75 Short-Term Borrowings 9,143 108 4.74 1,985 23 4.70 — — — — — — 2 — — Other Borrowings 34,733 391 4.52 34,723 402 4.70 34,713 407 4.66 34,702 407 4.67 34,692 404 4.68 Total Interest-Bearing Liabilities 1,050,384 6,220 2.38 1,042,556 6,536 2.54 1,102,746 7,899 2.85 1,102,402 8,299 2.99 1,068,353 7,469 2.81 Noninterest-Bearing Demand Deposits 270,729 265,522 267,598 263,650 272,280 Total Funding and Cost of Funds 1,321,113 1.89 1,308,078 2.03 1,370,344 2.29 1,366,052 2.42 1,340,633 2.24 Other Liabilities 20,789 11,854 17,883 15,043 21,867 Total Liabilities 1,341,902 1,319,932 1,388,227 1,381,095 1,362,500 Stockholders' Equity 147,139 147,763 147,873 145,593 140,664 Total Liabilities and Stockholders' Equity $ 1,489,041 $ 1,467,695 $ 1,536,100 $ 1,526,688 $ 1,503,164 Net Interest Income (FTE) (Non-GAAP) (3) $ 12,597 $ 11,367 $ 11,577 $ 11,516 $ 11,511 Net Interest-Earning Assets (4) 371,144 361,815 367,568 366,684 381,247 Net Interest Rate Spread (FTE) (Non-GAAP) (3) (5) 2.93 % 2.63 % 2.42 % 2.38 % 2.46 % Net Interest Margin (FTE) (Non-GAAP) (3)(6) 3.55 3.28 3.13 3.12 3.19 Expand (1) Annualized based on three months ended results. (2) Net of the allowance for credit losses and includes nonaccrual loans with a zero yield and Loans Held for Sale if applicable. (3) Refer to Explanation and Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure. (4) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. (5) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. (6) Net interest margin represents annualized net interest income divided by average total interest-earning assets. Expand AVERAGE BALANCES AND YIELDS Six Months Ended June 30, 2024 Assets: Interest-Earning Assets: Loans, Net (2) $ 1,086,955 $ 30,132 5.59 % $ 1,082,172 $ 29,586 5.50 % Debt Securities Taxable 281,447 5,637 4.01 250,912 5,148 4.10 Marketable Equity Securities 1,832 37 4.04 2,693 54 4.01 Interest-Earning Deposits at Banks 39,278 789 4.02 80,082 2,045 5.11 Other Interest-Earning Assets 3,484 123 7.12 3,195 171 10.76 Total Interest-Earning Assets 1,412,996 36,718 5.24 1,419,054 37,004 5.24 Noninterest-Earning Assets 65,758 54,141 Total Assets $ 1,478,754 $ 1,473,195 Liabilities and Stockholders' Equity: Interest-Bearing Liabilities: Interest-Bearing Demand Accounts $ 326,322 $ 3,203 1.98 % $ 329,974 $ 3,653 2.23 % Savings Accounts 173,193 83 0.10 188,194 111 0.12 Money Market Accounts 234,436 3,473 2.99 209,279 3,159 3.04 Time Deposits 272,229 5,074 3.76 278,538 6,133 4.43 Total Interest-Bearing Deposits 1,006,180 11,833 2.37 1,005,985 13,056 2.61 Short-Term Borrowings 5,584 131 4.73 1 — — Other Borrowings 34,728 792 4.60 34,687 808 4.68 Total Interest-Bearing Liabilities 1,046,492 12,756 2.46 1,040,673 13,864 2.68 Noninterest-Bearing Demand Deposits 268,140 275,485 Total Funding and Cost of Funds 1,314,632 1.96 1,316,158 2.12 Other Liabilities 16,673 16,559 Total Liabilities 1,331,305 1,332,717 Stockholders' Equity 147,449 140,478 Total Liabilities and Stockholders' Equity $ 1,478,754 $ 1,473,195 Net Interest Income (FTE) (Non-GAAP) (3) 23,962 23,140 Net Interest-Earning Assets (4) 366,504 378,381 Net Interest Rate Spread (FTE) (Non-GAAP) (3)(5) 2.78 % 2.56 % Net Interest Margin (FTE) (Non-GAAP) (3)(6) 3.42 3.28 Expand (1) Annualized based on six months ended results. (2) Net of the allowance for credit losses and includes nonaccrual loans with a zero yield and Loans Held for Sale if applicable. (3) Refer to Explanation and Use of Non-GAAP Financial Measures in this Press Release for the calculation of the measure and reconciliation to the most comparable GAAP measure. (4) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities. (5) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities. (6) Net interest margin represents annualized net interest income divided by average total interest-earning assets. Expand Explanation of Use of Non-GAAP Financial Measures In addition to financial measures presented in accordance with generally accepted accounting principles ('GAAP'), we use, and this Press Release contains or references, certain Non-GAAP financial measures. We believe these Non-GAAP financial measures provide useful information in understanding our underlying results of operations or financial position and our business and performance trends as they facilitate comparisons with the performance of other companies in the financial services industry. Non-GAAP adjusted items impacting the Company's financial performance are identified to assist investors in providing a complete understanding of factors and trends affecting the Company's business and in analyzing the Company's operating results on the same basis as that applied by management. Although we believe that these Non-GAAP financial measures enhance the understanding of our business and performance, they should not be considered an alternative to GAAP or considered to be more important than financial results determined in accordance with GAAP, nor are they necessarily comparable with similar Non-GAAP measures which may be presented by other companies. Where Non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found herein. 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 (Dollars in thousands, except share and per share data) (Unaudited) Total Assets (GAAP) $ 1,517,984 $ 1,483,456 $ 1,481,564 $ 1,561,741 $ 1,560,259 Goodwill and Intangible Assets, Net (9,732 ) (9,732 ) (9,732 ) (9,820 ) (10,085 ) Tangible Assets (Non-GAAP) (Numerator) $ 1,508,252 $ 1,473,724 $ 1,471,832 $ 1,551,921 $ 1,550,174 Stockholders' Equity (GAAP) $ 148,362 $ 148,289 $ 147,378 $ 149,140 $ 142,882 Goodwill and Intangible Assets, Net (9,732 ) (9,732 ) (9,732 ) (9,820 ) (10,085 ) Tangible Common Equity or Tangible Book Value (Non-GAAP) (Denominator) $ 138,630 $ 138,557 $ 137,646 $ 139,320 $ 132,797 Stockholders' Equity to Assets (GAAP) 9.8 % 10.0 % 9.9 % 9.5 % 9.2 % Tangible Common Equity to Tangible Assets (Non-GAAP) 9.2 % 9.4 % 9.4 % 9.0 % 8.6 % Common Shares Outstanding (Denominator) 4,972,300 5,099,069 5,132,654 5,129,921 5,141,911 Book Value per Common Share (GAAP) $ 29.84 $ 29.08 $ 28.71 $ 29.07 $ 27.79 Tangible Book Value per Common Share (Non-GAAP) $ 27.88 $ 27.17 $ 26.82 $ 27.16 $ 25.83 Expand Three Months Ended Six Months Ended 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 6/30/25 6/30/24 (Dollars in thousands) (Unaudited) Net Income (GAAP) $ 3,949 $ 1,909 $ 2,529 $ 3,219 $ 2,650 $ 5,858 $ 6,847 Amortization of Intangible Assets, Net — — 88 264 264 — 605 Adjusted Net Income (Non-GAAP) (Numerator) $ 3,949 $ 1,909 $ 2,617 $ 3,483 $ 2,914 $ 5,858 $ 7,452 Annualization Factor 4.01 4.06 3.98 3.98 4.02 2.02 2.01 Average Stockholders' Equity (GAAP) $ 147,139 $ 147,763 $ 147,873 $ 145,593 $ 140,664 $ 147,449 $ 140,478 Average Goodwill and Intangible Assets, Net (9,732 ) (9,732 ) (9,758 ) (9,987 ) (10,242 ) (9,732 ) (10,398 ) Average Tangible Common Equity (Non-GAAP) (Denominator) $ 137,407 $ 138,031 $ 138,115 $ 135,606 $ 130,422 $ 137,717 $ 130,080 Return on Average Equity (GAAP) 10.76 % 5.24 % 6.80 % 8.80 % 7.58 % 8.01 % 9.80 % Return on Average Tangible Common Equity (Non-GAAP) 11.53 % 5.61 % 7.54 % 10.22 % 8.99 % 8.58 % 11.52 % Expand Three Months Ended Six Months Ended 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 6/30/25 6/30/24 (Dollars in thousands) (Unaudited) Interest Income (GAAP) $ 18,760 $ 17,847 $ 19,431 $ 19,773 $ 18,939 $ 36,606 $ 36,926 Adjustment to FTE Basis 57 56 45 42 41 112 78 Interest Income (FTE) (Non-GAAP) 18,817 17,903 19,476 19,815 18,980 36,718 37,004 Interest Expense (GAAP) 6,220 6,536 7,899 8,299 7,469 12,756 13,864 Net Interest Income (FTE) (Non-GAAP) $ 12,597 $ 11,367 $ 11,577 $ 11,516 $ 11,511 $ 23,962 $ 23,140 Net Interest Rate Spread (GAAP) 2.91 % 2.61 % 2.41 % 2.36 % 2.44 % 2.76 % 2.55 % Adjustment to FTE Basis 0.02 0.02 0.01 0.02 0.02 0.02 0.01 Net Interest Rate Spread (FTE) (Non-GAAP) 2.93 % 2.63 % 2.42 % 2.38 % 2.46 % 2.78 % 2.56 % Net Interest Margin (GAAP) 3.54 % 3.27 % 3.12 % 3.11 % 3.18 % 3.40 % 3.27 % Adjustment to FTE Basis 0.01 0.01 0.01 0.01 0.01 0.02 0.01 Net Interest Margin (FTE) (Non-GAAP) 3.55 % 3.28 % 3.13 % 3.12 % 3.19 % 3.42 % 3.28 % Expand Three Months Ended Six Months Ended 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 6/30/25 6/30/24 (Dollars in thousands) (Unaudited) Income Before Income Tax Expense (GAAP) $ 4,715 $ 2,336 $ 3,051 $ 3,966 $ 3,210 $ 7,051 $ 8,327 Net Provision (Recovery) for Credit Losses 8 (40 ) 683 (41 ) (36 ) (32 ) (73 ) PPNR (Non-GAAP) 4,723 2,296 3,734 3,925 3,174 7,019 8,254 Adjustments Net Loss (Gain) on Securities — 69 (3 ) (245 ) 31 69 197 Gain on Sale of Subsidiary — — — (138 ) — — — Net Gain on Disposal of Premises and Equipment — — — — — — (274 ) Earn-out Payment Related to the Sale of EU — (49 ) (708 ) — — (49 ) — Net Gain on Bank-Owned Life Insurance Claims — — — — — — (915 ) Reduction in Force Expenses — 1,003 — — — Adjusted PPNR (Non-GAAP) (Numerator) $ 4,723 $ 3,319 $ 3,023 $ 3,542 $ 3,205 $ 7,039 $ 7,262 Annualization Factor 4.01 4.06 3.98 3.98 4.02 2.02 2.01 Average Assets (Denominator) $ 1,489,041 $ 1,467,695 $ 1,536,100 $ 1,526,688 $ 1,503,164 $ 1,478,754 $ 1,473,195 Adjusted PPNR Return on Average Assets (Non-GAAP) 1.27 % 0.92 % 0.78 % 0.92 % 0.86 % 0.96 % 0.99 % Expand Three Months Ended Six Months Ended 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 6/30/25 6/30/24 (Dollars in thousands, except share and per share data) (Unaudited) Net Income (GAAP) $ 3,949 $ 1,909 $ 2,529 $ 3,219 $ 2,650 $ 5,858 $ 6,847 Adjustments Net Loss (Gain) on Securities — 69 (3 ) (245 ) 31 69 197 Gain on Sale of Subsidiary — — — (138 ) — — — Net Gain on Disposal of Premises and Equipment — — — — — — (274 ) Earn-out Payment Related to the Sale of EU — (49 ) (708 ) — — (49 ) — Net Gain on Bank-Owned Life Insurance Claims — — — — — — (915 ) Reduction in Force Expenses — 1,003 — — — 1,003 — Tax effect — (215 ) 149 90 (7 ) (215 ) 16 Adjusted Net Income (Non-GAAP) $ 3,949 $ 2,717 $ 1,967 $ 2,926 $ 2,674 $ 6,666 $ 5,871 Weighted-Average Diluted Common Shares and Common Stock Equivalents Outstanding 5,332,026 5,471,006 5,544,829 5,346,750 5,152,657 5,387,924 5,151,188 Earnings per Common Share - Diluted (GAAP) $ 0.74 $ 0.35 $ 0.46 $ 0.60 $ 0.51 $ 1.09 $ 1.33 Adjusted Earnings per Common Share - Diluted (Non-GAAP) $ 0.74 $ 0.50 $ 0.35 $ 0.55 $ 0.52 $ 1.24 $ 1.14 Net Income (GAAP) (Numerator) $ 3,949 $ 1,909 $ 2,529 $ 3,219 $ 2,650 $ 5,858 $ 6,847 Annualization Factor 4.01 4.06 3.98 3.98 4.02 2.02 2.01 Average Assets (Denominator) 1,489,041 1,467,695 1,536,100 1,526,688 1,503,164 1,478,754 1,473,195 Return on Average Assets (GAAP) 1.06 % 0.53 % 0.65 % 0.84 % 0.71 % 0.80 % 0.93 % Adjusted Net Income (Non-GAAP) (Numerator) $ 3,949 $ 2,717 $ 1,967 $ 2,926 $ 2,674 $ 6,666 $ 5,871 Annualization Factor 4.01 4.06 3.98 3.98 4.02 2.02 2.01 Average Assets (Denominator) 1,489,041 1,467,695 1,536,100 1,526,688 1,503,164 1,478,754 1,473,195 Adjusted Return on Average Assets (Non-GAAP) 1.06 % 0.75 % 0.51 % 0.76 % 0.72 % 0.91 % 0.80 % Expand Three Months Ended Six Months Ended 6/30/25 3/31/25 12/31/24 9/30/24 6/30/24 6/30/25 6/30/24 (Dollars in thousands) (Unaudited) Net Income (GAAP) (Numerator) $ 3,949 $ 1,909 $ 2,529 $ 3,219 $ 2,650 $ 5,858 $ 6,847 Annualization Factor 4.01 4.06 3.98 3.98 4.02 2.02 2.01 Average Equity (GAAP) (Denominator) 147,139 147,763 147,873 145,593 140,664 147,449 140,478 Return on Average Equity (GAAP) 10.76 % 5.24 % 6.80 % 8.80 % 7.58 % 8.01 % 9.80 % Adjusted Net Income (Non-GAAP) (Numerator) $ 3,949 $ 2,717 $ 1,967 $ 2,926 $ 2,674 $ 6,666 $ 5,871 Annualization Factor 4.01 4.06 3.98 3.98 4.02 2.02 2.01 Average Equity (GAAP) (Denominator) 147,139 147,763 147,873 145,593 140,664 147,449 140,478 Adjusted Return on Average Equity (Non-GAAP) 10.76 % 7.46 % 5.29 % 8.00 % 7.65 % 9.12 % 8.40 % Expand
