NASDAQ:TRMK Trustmark Q2 2024 Earnings Report $33.80 +1.11 (+3.41%) As of 03:33 PM Eastern This is a fair market value price provided by Polygon.io. Learn more. Earnings HistoryForecast Trustmark EPS ResultsActual EPS$0.66Consensus EPS $0.63Beat/MissBeat by +$0.03One Year Ago EPS$0.74Trustmark Revenue ResultsActual Revenue$283.96 millionExpected Revenue$229.83 millionBeat/MissBeat by +$54.13 millionYoY Revenue GrowthN/ATrustmark Announcement DetailsQuarterQ2 2024Date7/23/2024TimeAfter Market ClosesConference Call DateWednesday, July 24, 2024Conference Call Time9:30AM ETUpcoming EarningsTrustmark's Q1 2025 earnings is scheduled for Tuesday, April 22, 2025, with a conference call scheduled on Wednesday, April 23, 2025 at 9:30 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Trustmark Q2 2024 Earnings Call TranscriptProvided by QuartrJuly 24, 2024 ShareLink copied to clipboard.There are 7 speakers on the call. Operator00:00:00Good morning, ladies and gentlemen, and welcome to Trustmark Corporation's Second Quarter Earnings Conference Call. At this time, all participants are in a listen only mode. Following the presentation this morning, there will be a question and answer session. As a reminder, this call is being recorded. It is now my pleasure to introduce Mr. Operator00:00:26Joey Rain, Director of Corporate Strategy at Trustmark. Please go ahead, sir. Speaker 100:00:31Good morning. I'd like to remind everyone that a copy of our 2nd quarter earnings release as well as the slide presentation that will be discussed on our call this morning is available on the Investor Relations section of our website at trustmark.com. During the call, management may make forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. And we would like to caution you that these forward looking statements may differ materially from actual results due to a number of risks and uncertainties, which are outlined in our earnings release and our other filings with the Securities and Exchange Commission. At this time, I'd like to introduce Duane Dewey, President and CEO of Trustmark Corporation. Speaker 200:01:13Thank you, Joey, and good morning, everyone. Thank you for joining us this morning. With me are Tom Owens, our Chief Financial Officer Barry Harvey, our Chief Credit and Operations Officer and Tom Chambers, our Chief Accounting Officer. The second quarter was a very active quarter and productive for Trustmark, so we have a lot to share with you this morning on multiple fronts. During the quarter, we completed significant actions to increase earnings, enhance our profitability profile, reduce risk and strengthen capital flexibility. Speaker 200:01:50We had 4 significant non routine items as outlined on Slide 3. First, we completed the previously announced sale of Fisher Brown Boxer Insurance, capitalizing on attractive multiples of 5 point times revenue 5.9 times revenue and 28 times net income. We recognized an after tax gain on sale of $171,200,000 2nd, we sold $1,600,000,000 of AFS securities with an average yield of 1.36 percent, generating a loss of 182,800,000 dollars We then purchased $1,400,000,000 of AFS securities with an average yield of 4.85%, which significantly will significantly boost our net interest margin and enhance our profitability profile. Tom Collins will provide some additional color on this restructuring process that took place in late May and throughout much of June. 3rd, we proactively reduced the risk profile of our 1 to 4 family mortgage portfolio. Speaker 200:03:08During the quarter, we sold mortgage loans that were 3 payments or more delinquent and or non accrual at the time of selection totaling 56,200,000 dollars The mortgage loan sale resulted in an after tax loss of $10,100,000 and this sale drove a $54,100,000 reduction in non performing loans. Finally, we exchanged our Visa Class B1 shares for B2 shares and Class C common stock. The exchange of Class C shares resulted in a 6 $1,000,000 after tax gain during the quarter. With all the moving parts during the quarter, we developed Slide 4 to illustrate the strength of the quarter and provide additional details. The first column reflects reported earnings in the 2nd quarter of $73,800,000 or earnings of $1.20 per diluted share. Speaker 200:04:08The next column reflects that we recognized $171,200,000 or $2.70 per diluted share on the sale of the agency. During the 2 months of the quarter, we owned the agency with recognized $3,200,000 in net income. Backing out the discontinued operations associated with the agency, the restructuring of the AFS securities portfolio, the mortgage loan sale and the Visa share exchange, adjusted earnings from continuing operations in the 2nd quarter was $40,500,000 or $0.66 per diluted share. Our performance in the 2nd quarter also compares favorably to net income from continuing operations in the prior quarter, which is shown on the right side of the chart. We've discussed the non grouping transactions during the quarter. Speaker 200:05:06Now let's turn to Slide 5 for a recap of the strong fundamental accomplishments during the quarter. Loans held for investment increased $98,000,000 linked quarter net of the mortgage sale and $541,000,000 year over year. Deposit growth exceeded loan growth, increasing $124,000,000 linked quarter $549,000,000 from the prior year. A significant contributor to our performance in the quarter was the growth in net interest income, which increased $8,000,000 or 6 percent linked quarter to 144,000,000 dollars The net interest margin expanded 17 basis points during the quarter to 3.38%. Revenue from continuing operations increased 4.1% linked quarter, and noninterest income from continuing operations represented 21.3 percent of total revenue. Speaker 200:06:13Diligent expense management continues to be a focus of the organization and non interest expense declined 1.1% linked quarter. Given the mortgage loan sale, key takeaways include non accrual loans declining 55% and net charge offs excluding the mortgage loan sales totaled $3,000,000 representing 9 basis points of average loans. The allowance for credit losses represented 1.18 percent of loans held for investment and 8 40% of non accrual loans, excluding individually analyzed loans at June 30. Trustmark's capital ratios expanded meaningfully during the quarter as tangible equity to tangible assets increased 105 basis points to 8.52%, while CET1 ratio expanded 80 basis points to 10.92 percent and total risk based capital expanded 87 basis points to 13.29 percent. The 2nd quarter was fundamentally strong and the actions taken during the quarter were designed to enhance our profitability profile going forward. Speaker 200:07:34Turning to Slide 6, we expect loans held for investment and deposits to grow single digits for the full year 2024. Securities balances are expected to remain stable as we reinvest cash flows. We anticipate net interest income to increase to low single digits in 2024, reflecting continuing asset growth, stabilizing deposit costs and accretion from balance sheet repositioning, resulting in full year 2024 net interest margin of approximately 3.4% based on the market implied forward interest rates. We expect the net interest margin to be in the range of 3.55% to 3.60% in the second half of twenty twenty four. From a credit perspective, the provision for credit losses, including unfunded commitments, is dependent upon credit quality trends, current macroeconomic forecast and future loan growth. Speaker 200:08:37Net charge offs from continuing operations are expected to remain below the industry average based on the current economic outlook. Noninterest income from continuing operations in the second half of twenty twenty four is expected to increase low single digits compared to the first half of twenty twenty four. The year when compared to the first half of twenty twenty four. We will continue our disciplined approach to capital deployment with a preference for organic loan growth, potential market expansion, M and A or other general corporate purposes depending on market conditions. We also continue to assess the Board of Directors approved 2024 share repurchase program as the market and balance sheet dictate. Speaker 200:09:35At this time, Barry Harvey is going to provide some color on our loan portfolio and credit quality. Speaker 300:09:41Thank you, Duane. I'll be glad to. Turning to Slide 7, loans held for investments totaled $13,200,000,000 as of June 30. That's an increase, as Duane mentioned, of $97,000,000 for the quarter. Loan growth during Q2 came from commercial real estate and the equipment finance line of business. Speaker 300:10:03We expect loan growth of low single digits for 2024. As you can see, our loan portfolio remains diversified both from a product standpoint as well as a geography. Looking on to Slide 8, Trustmark's CRE portfolio is 94% vertical with 69% in the existing category and 31% in construction land development. Our construction land development portfolio is 82% construction. Trustmark's office portfolio as you can see is very modest at $279,000,000 outstanding, which represents only 2% of our overall loan book. Speaker 300:10:44The portfolio was comprised of credits with high quality tenants, low lease turnover, strong occupancy levels and low leverage. On Slide 9, the bank's commercial portfolio is well diversified as you can see across numerous industries with no single category exceeding 15%. Looking at Slide 10, our provision for credit losses for loans held for investment was $23,300,000 during the Q2. Excluding the mortgage loan sale, the provision for credit losses for loans held for investment was $14,700,000 which was driven by 2 parts, 1, loan growth as well as risk rate migration. The provision for credit losses for off balance sheet credit exposure was a negative 3,600,000 dollars which resulted primarily from a decline in unfunded CRE commitments. Speaker 300:11:47At June 30, the allowance for credit losses for loans held for investment was $155,000,000 Looking on Slide 11, we continue to post solid credit quality metrics. The allowance for credit losses represents 1.18% of loans held for investment and 8 40 percent of non accruals excluding those that are individually analyzed. In the Q2, net charge offs totaled $11,600,000 Excluding the previously referenced mortgage loan sale, net charge offs totaled $3,000,000 or 9 basis points of average loans. Both non accruals and non performing assets decreased significantly during the quarter as a result of the mortgage loan sale. Duane? Speaker 200:12:39Okay. Thanks, Barry. Now Tom Owens will cover deposits, net interest margin and non interest income. Speaker 400:12:46Thanks, Duane, and good morning, everyone. Turning to deposits on Slide 12. We had another good quarter, which continued to show the strength of our deposit base. Deposits totaled $15,500,000,000 at June 30, a linked quarter increase of $124,000,000 or 0.8 10 percent to 1 percent a year over year increase of $549,000,000 or 3.7 percent. The linked quarter increase was driven by growth of $114,000,000 in non interest bearing DDA balances, which remained at 20% of our deposit base. Speaker 400:13:23Time deposits also increased by $90,000,000 linked quarter, driven by $77,000,000 of growth in personal CDs and $13,000,000 of growth in brokered CDs. As of June 30, our promotional and exception price time deposit book totaled $1,500,000,000 with a weighted average rate paid of $4.98 and a weighted average remaining term of about 5 months. Our broker deposit book totaled $600,000,000 had an all in weighted average rate paid, which remained at about 5 0.43%, and the weighted average remaining term remained at about 3 months as of June 30. Our cost of interest bearing deposits increased by 1 basis point from the prior quarter to 2.75%, down from the 7 basis point linked quarter increase in the 2nd quarter. Turning to Slide 13. Speaker 400:14:21Trustmark continues to maintain a stable granular and low exposure deposit base. During the Q1, we had an average of about 460,000 personal and non personal deposit accounts, excluding collateralized public fund accounts, with an average balance per account of about $27,000 As of June 30, 64% of our deposits were insured and 14% were collateralized, meaning that our mix of deposits that are uninsured and uncollateralized was essentially unchanged linked quarter at 22%. We continue to maintain substantial secured borrowing capacity, which stood at $6,100,000,000 at June 30, representing 179% coverage on uninsured and uncollateralized deposits. Our 2nd quarter total deposit cost was unchanged linked quarter at 2.18 percent, which continues to represent the cumulative beta cycle to date of 40%. The favorable variance to prior guidance was driven by pricing actions we've taken during the Q1, which gave us a running start toward a lower deposit cost in the Q2. Speaker 400:15:36Deposit cost has, however, continued to increase monthly and as a frame of reference for the guide to 2.27% in the 3rd quarter, which would bring the cycle to date to 44%, deposit cost is approximately 2.25% month to date in July. Turning our attention to revenue on Slide 14, net interest income FTE increased $8,100,000 linked quarter, totaling $144,300,000 which resulted in a net interest margin of 3.38%. Net interest margin increased by 17 basis points linked quarter, driven by 13 basis points of accretion from loan rated volume and 5 basis points of accretion from the securities portfolio restructuring. With respect to the loan rate accretion, loan fees normalized during the Q2 from the unusual drop we had experienced during the Q1. Absent the linked quarter volatility in loan fees, loan yields continue to trend higher by mid single digit basis points each quarter. Speaker 400:16:46As Lainie indicated, we anticipate net interest margin of 3.55% to 3.60% in the second half of twenty 24, with the increase driven by the securities portfolio restructuring, which was completed during June, resulting in an anticipated securities portfolio yield of approximately 3.5% going forward. We were pleased with the execution of the securities portfolio restructuring in what was a challenging interest rate environment, and we did achieve our objectives with the restructuring of extending effective duration from about 3 point 7 years to about 4.2 years. We adjusted mix to achieve more consistent ladder of cash flows over time, while also improving the stability of cash flows to changes in interest rates, while picking up approximately 350 basis points of yield between securities purchased and securities sold. Turning to Slide 15. Our interest rate risk profile remained essentially unchanged at June 30. Speaker 400:17:54We continue to substantial asset sensitivity driven by loan portfolio mix with 51% variable rate coupon. During the Q2, we entered into $60,000,000 notional of forward starting interest rate swaps, which brought the swap portfolio notional at quarter end to $1,165,000,000 with a weighted average maturity of 3 years and a weighted average received fixed rate of 3.23%. We also entered into $30,000,000 notional of forward starting floors, which brought the floor portfolio notional at quarter end to $150,000,000 with a weighted average maturity of 4.3 years at a weighted average SOFR rate of 3.68%. The cash hedging program substantially reduces our adverse asset sensitivity to potential downward stock and interest rates. Turning to Slide 16, non interest income from adjusted continuing operations totaled 38 $200,000 in the 2nd quarter, a $1,100,000 linked quarter decrease and approximately $400,000 year over year increase. Speaker 400:19:07The linked quarter decrease was driven by a $3,400,000 increase in negative net hedge ineffectiveness, which was driven by a higher assumed discount rate applied to mortgage servicing cash flows and the asset valuation methodology. Excluding the increase in negative net hedging effectiveness, linked quarter increase in total non interest income would have been $2,300,000 or 5 0.8 percent and the year over year increase would have been $3,600,000 or 9.4%. And now I'll ask Tom Chambers to cover non interest expense and capital management. Speaker 100:19:44Thank you, Tom. Turning to Slide 17, we'll see a detail of our total non interest expense. During the Q2, non interest expense continued to decline and totaled $118,300,000 a linked quarter decrease of $1,300,000 or 1.1%. This decline was mainly driven by a decrease in salary and benefits of $600,000 resulting in reduced compensation expense and a seasonal decline in payroll taxes, offset by increased commission expense driven by increased revenue. Other expense decreased by $900,000 resulting from lower operational losses during the quarter. Speaker 100:20:26Turning to Slide 18, Trustmark remains well positioned from a capital perspective. As Duane previously mentioned, our capital ratios remain solid with a common equity Tier 1 ratio of 10.92%, a linked quarter increase of 80 basis points and a total risk based capital ratio of 13.29%, a linked quarter increase of 87 basis points. Although we currently have a $50,000,000 share repurchase program in place, our priority for capital deployment continues to be focused on organic lending. As Duane indicated, we will continue to evaluate the share repurchase program as a market and our capital levels dictate. Speaker 200:21:09Back to you, George. Great. Thanks, Tom. A very, very busy quarter for us here. So we'll now open the floor up for questions that you may have. Operator00:21:53And the first question will come from Catherine Mealor with KBW. Please go ahead. Speaker 500:21:59Thanks. Good morning. Speaker 200:22:00Good morning, Catherine. Speaker 500:22:03I wanted to start on some of the guidance that you provided, which is really helpful just to look at it on continuing operations and then kind of a growth rate to the back half of the year. So thank you for how you laid that out. I think with expenses, if you take the first half of the year and then grow that at a low single digit pace, I'm getting kind of a run rate in the back half of the year around kind of 120 $2,000,000 $123,000,000 a quarter, which is a little bit higher than the first half. Just want to make sure that that's around what you're thinking and where some of that growth is coming from? Speaker 200:22:37Catherine, I'll start, Tom. Chambers can continue on. But yes, I think general, of the things that occur in the Q1 and Q2 will not continue into the second half of the year. So we do think we'll get a little bit of growth comparing first half to second half and it is in the very low single digit range. Tom can elaborate a little more, but yes, I think you're about right with your numbers. Speaker 200:23:05Tom? Speaker 100:23:07Yes. Duane, thank you. I believe the biggest driver of the increase in the second half of the year is we changed our merit increase structure. We used to have merit increases hit during March of the year and we delayed that this year to hit in July. So the first half of the year did not have merit increases in our salaries and the second half of the year will. Speaker 300:23:31So that will be the biggest, but it still keeps it Speaker 200:23:33in that low, very low single digit range. Yes, sir. Speaker 500:23:37Okay, great. Perfect. And everything else was made perfect sense. I'm actually not going to ask a margin question this quarter. So Tom, I'm going to you're off the hook this quarter from me. Speaker 500:23:48My second question is on the CREs, it looks like you sold the NPAs, but then built the reserve and looks like you put a lot of that in your CRE reserve. Just curious if that's just from pure conservatism or was there any negative migration in special mentioned or Speaker 400:24:03classified within your commercial Speaker 500:24:03real estate portfolio that drove that? Speaker 400:24:11Both of those. Good morning, good Speaker 300:24:11morning. Good morning. The first thought process as it relates to the selling of the mortgage book that we did was, those are that's most all that's 30 year paper and once it gets into that category of non accrual and there is a high roll rate from prepayments down and more, it's kind of sticky and hard to remove. And we thought in today's environment, while it's still attractive, it'd be a good time to go ahead and give ourselves some additional room as it relates to NPLs and NPAs. As it relates to your second part of your question as regarding the risk rate migrations driving some of the provisioning, that is correct. Speaker 300:24:56I mean, we like all banks on the CRE side are beginning to see some risk rate migration as it relates to predominantly special mention and occasionally there's some that's going to be substandard. We don't really see this as anything other than a cycle at this stage that we're flowing through. But of course, when you have the rate increases we have coming out of what was put on the books in the second half of really, really all of 'twenty three and then most all of 'twenty two, if not all of 'twenty two, that population is going to be more challenged just because it was made the lowest lowest rate environment and then now it's functioning because all of ours are variable rate that I'm referencing. It's functioning and it's always been functioning in the higher rate environment. So there is more stress on the category of lending, not just for Trustmark, but anybody who was booking those type of CRE loans during that window of time that are now beginning to reach CO and in many cases beginning to stabilize, there is the need to continue to support those projects by the sponsor, by the guarantors, by the borrowers in order to give them a little bit more time to fully stabilize. Speaker 300:26:19It's also a function of most construction projects for quite a while, very seldom do they finish on time. So they need a little more time to fully stabilize. And sometimes that's 6 months, sometimes that's 12 months. So it's all those factors that are going into making sure we're staying on top of our credits, making sure we're grading them appropriately at all times. I wouldn't call it conservatism. Speaker 300:26:43I would just say that we're very focused on making sure that we're looking at as much of the book as often as we can to make sure the grades are right at all times, which would lead you to believe the ACL is accurate at all times as well. Speaker 500:26:57Okay. That's great. Do you have the balances of increase in criticized or classified? Speaker 300:27:05We don't report those in our earnings traditionally. There will be of course, there will be in the call report. Speaker 500:27:11Okay. That's great. We can wait for that. So it seems like the lost content perhaps is still arguably low on these projects, but you're more just migrating them to special mentioned if there needs to be support from the guarantor just because of a project delay? Speaker 300:27:29That's correct. That's the correct assessment, Catherine. We don't see our this quarter charge offs for $3,000,000 when you exclude the mortgage sale, which is obviously one time. That's versus $4,000,000 last quarter. So we don't really see a trend developing there that that's a concern. Speaker 300:27:47We don't see a trend developing in our NPAs or NPLs of concern, but we do want to make sure the grading is correct on all of our credits and we would expect those to cycle like especially if we got any type of rate reductions second half of this year or next year. Obviously, any of those would be some welcome relief in terms of trying to meet those debt service coverage ratio requirements. Speaker 500:28:14Great. Thank you very much for the color, Barry. Operator00:28:22Our next question will come from Gary Tenner with D. A. Davidson. Please go ahead. Speaker 600:28:28Thanks. Good morning. Speaker 200:28:29Good morning, guys. Speaker 600:28:30I wanted to ask about the guide on deposit costs for the Q3. I guess I'm a little surprised that it's the guide is that much higher just given the success on the non interest bearing front in the second quarter and generally moderating deposit cost increases in the industry overall. So you had alluded to some actions you took to set yourselves up better for lower rates. I'm curious kind of what impact that's having on the 3rd quarter outlook? Speaker 400:29:03Yes. Good morning, Gary. This is Tom Owens. So, good question. Coming into 2024, early in Q1, we began to take some actions to try and rationalize our deposit costs, particularly as it related to maturing promotional CDs, as well as some rates on non maturity products. Speaker 400:29:30And what we found, I don't want to say that was experimental, right, but I think all banks at this point are focused on their deposit base and what the opportunities are to try and rationalize cost. And so we did try some of that in the Q1. And what we found is we were driving more deposit mix change and more deposit disintermediation than we would have liked. And so we got into approximately mid March and we really sort of pivoted away from that. And so that's what I mean by the actions we had taken in the Q1, which set us up for a good running start, so to speak, towards beating on the guide that we had put out there for the Q2. Speaker 400:30:17But at the same time, knowing that those deposit costs would continue to march higher going forward. And that's what we've seen. So I would really encourage you and analysts and investors to think in terms of whether we're talking about loan yield or deposit cost, it's think in terms of mid single digit increases on a normalized basis. We had a sort of a hiccup in terms of our loan yields in the Q1 on a linked quarter basis, which was the result of sort of an unusual decrease in loan fees, that normalized for us here in the Q2, right? And so you saw what is seemingly a disproportionately large increase on a linked quarter basis in loan yield in the Q2, that was normalization. Speaker 400:31:15And our guide in terms of deposit costs for the Q3 is also normalization. We're in relative equilibrium at this point on a month over month basis and on a linked quarter basis in terms of Speaker 600:31:38Thanks a lot for those thoughts, Barry. I guess if I were to boil it down to thinking that the Q3 outlook on deposit cost is almost is basically then normalized and you kind of skipped over the 2nd quarter from a repricing perspective? Is that kind Speaker 300:31:52of what it falls? Speaker 200:31:53Absolutely. And that's Speaker 400:31:54exactly right, Gary. And that's why in my prepared comments, I gave you the reference point of month to date deposit cost here in July of 2.25 Speaker 600:32:05percent. Okay. I appreciate that. And then if I could ask a follow-up just on capital. You've talked about kind of the priorities of organic growth, etcetera, but pushing an 11% CET1 ratio. Speaker 600:32:21I wonder if you could talk about capital really more from an M and A perspective, kind of where things are in terms of conversations? Has there been any sort of increase in conversations in your footprint and activity levels? Speaker 200:32:40I'll start, others can add if they need to. As it relates to M and A, I mean, first of all, yes, there are more there's a little more activity out there and things we're hearing about and things that are being presented to us as opportunities, etcetera. So we are seeing some increased activity there. In our minds, I think we wanted to get through this quarter with a lot of noise and activity and all these different one time deals kind of let the dust settle. And then really moving in to 2025 more thinking about the M and A space in a little more with a little more focus and the like. Speaker 200:33:24But at the end of the day, I do believe there is a little more activity or at least a lot of different discussions and thought processes going on across our marketplace. Speaker 400:33:38Thank you. Operator00:33:43This concludes our question and answer session. I would like to turn the conference back over to Mr. Duane Dewey for any closing remarks. Please go ahead, sir. Speaker 200:33:52Thank you again for joining us this morning. Very, very busy quarter for us and we're very excited about the second half of twenty twenty four. And we look forward to our Q3 call in October. So look forward to catching up then. Thank you. Operator00:34:12The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallTrustmark Q2 202400:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) Trustmark Earnings HeadlinesEarnings Preview For TrustmarkApril 21 at 7:27 PM | benzinga.comTrustmark (TRMK) Projected to Post Quarterly Earnings on TuesdayApril 20 at 1:29 AM | americanbankingnews.comTrade War Just Turned 3 Unknown Stocks Into Rocket FuelThe Real Catalyst Behind America’s Next Bull Run One overlooked sector is being completely repriced — and smart investors are quietly positioning before the crowd catches on.April 22, 2025 | Insiders Exposed (Ad)Trustmark (TRMK) Stock Jumps 6.8%: Will It Continue to Soar?April 10, 2025 | msn.comInstitutional owners may ignore Trustmark Corporation's (NASDAQ:TRMK) recent US$212m market cap decline as longer-term profits stay in the greenApril 5, 2025 | finance.yahoo.comTrustmark Corporation to Announce First Quarter Financial Results April 22 and Conduct Earnings Conference Call April 23March 31, 2025 | businesswire.comSee More Trustmark Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Trustmark? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Trustmark and other key companies, straight to your email. Email Address About TrustmarkTrustmark (NASDAQ:TRMK) operates as the bank holding company for Trustmark National Bank that provides banking and other financial solutions to individuals and corporate institutions in the United States. The company operates through three segments: General Banking, Wealth Management, and Insurance. It offers checking, savings, and money market accounts; certificates of deposits and individual retirement accounts; financing for commercial and industrial projects, income-producing commercial real estate, owner-occupied real estate, and construction and land development; and installment and real estate loans, and lines of credit, as well as treasury management services. The company also provides mortgage banking services, including construction financing, production of conventional and government-insured mortgages, and secondary marketing and mortgage servicing. In addition, it provides wealth management and trust services, such as administration of personal trusts and estates; management of investment accounts for individuals, employee benefit plans, and charitable foundations; and corporate trust and institutional custody, securities brokerage, financial and estate planning, retirement plan, and investment management services. Further, the company offers business insurance products and services for medical professionals, construction, manufacturing, hospitality, real estate, and group life and health plans; and life and health insurance, and personal line policies for individual customers. Trustmark Corporation was founded in 1889 and is headquartered in Jackson, Mississippi.View Trustmark ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Breaking Down Taiwan Semiconductor's Earnings and Future UpsideArcher Aviation Unveils NYC Network Ahead of Key Earnings ReportAlcoa’s Solid Earnings Don’t Make Tariff Math Easier for AA Stock3 Reasons to Like the Look of Amazon Ahead of EarningsTesla Stock Eyes Breakout With Earnings on DeckJohnson & Johnson Earnings Were More Good Than Bad—Time to Buy? 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There are 7 speakers on the call. Operator00:00:00Good morning, ladies and gentlemen, and welcome to Trustmark Corporation's Second Quarter Earnings Conference Call. At this time, all participants are in a listen only mode. Following the presentation this morning, there will be a question and answer session. As a reminder, this call is being recorded. It is now my pleasure to introduce Mr. Operator00:00:26Joey Rain, Director of Corporate Strategy at Trustmark. Please go ahead, sir. Speaker 100:00:31Good morning. I'd like to remind everyone that a copy of our 2nd quarter earnings release as well as the slide presentation that will be discussed on our call this morning is available on the Investor Relations section of our website at trustmark.com. During the call, management may make forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. And we would like to caution you that these forward looking statements may differ materially from actual results due to a number of risks and uncertainties, which are outlined in our earnings release and our other filings with the Securities and Exchange Commission. At this time, I'd like to introduce Duane Dewey, President and CEO of Trustmark Corporation. Speaker 200:01:13Thank you, Joey, and good morning, everyone. Thank you for joining us this morning. With me are Tom Owens, our Chief Financial Officer Barry Harvey, our Chief Credit and Operations Officer and Tom Chambers, our Chief Accounting Officer. The second quarter was a very active quarter and productive for Trustmark, so we have a lot to share with you this morning on multiple fronts. During the quarter, we completed significant actions to increase earnings, enhance our profitability profile, reduce risk and strengthen capital flexibility. Speaker 200:01:50We had 4 significant non routine items as outlined on Slide 3. First, we completed the previously announced sale of Fisher Brown Boxer Insurance, capitalizing on attractive multiples of 5 point times revenue 5.9 times revenue and 28 times net income. We recognized an after tax gain on sale of $171,200,000 2nd, we sold $1,600,000,000 of AFS securities with an average yield of 1.36 percent, generating a loss of 182,800,000 dollars We then purchased $1,400,000,000 of AFS securities with an average yield of 4.85%, which significantly will significantly boost our net interest margin and enhance our profitability profile. Tom Collins will provide some additional color on this restructuring process that took place in late May and throughout much of June. 3rd, we proactively reduced the risk profile of our 1 to 4 family mortgage portfolio. Speaker 200:03:08During the quarter, we sold mortgage loans that were 3 payments or more delinquent and or non accrual at the time of selection totaling 56,200,000 dollars The mortgage loan sale resulted in an after tax loss of $10,100,000 and this sale drove a $54,100,000 reduction in non performing loans. Finally, we exchanged our Visa Class B1 shares for B2 shares and Class C common stock. The exchange of Class C shares resulted in a 6 $1,000,000 after tax gain during the quarter. With all the moving parts during the quarter, we developed Slide 4 to illustrate the strength of the quarter and provide additional details. The first column reflects reported earnings in the 2nd quarter of $73,800,000 or earnings of $1.20 per diluted share. Speaker 200:04:08The next column reflects that we recognized $171,200,000 or $2.70 per diluted share on the sale of the agency. During the 2 months of the quarter, we owned the agency with recognized $3,200,000 in net income. Backing out the discontinued operations associated with the agency, the restructuring of the AFS securities portfolio, the mortgage loan sale and the Visa share exchange, adjusted earnings from continuing operations in the 2nd quarter was $40,500,000 or $0.66 per diluted share. Our performance in the 2nd quarter also compares favorably to net income from continuing operations in the prior quarter, which is shown on the right side of the chart. We've discussed the non grouping transactions during the quarter. Speaker 200:05:06Now let's turn to Slide 5 for a recap of the strong fundamental accomplishments during the quarter. Loans held for investment increased $98,000,000 linked quarter net of the mortgage sale and $541,000,000 year over year. Deposit growth exceeded loan growth, increasing $124,000,000 linked quarter $549,000,000 from the prior year. A significant contributor to our performance in the quarter was the growth in net interest income, which increased $8,000,000 or 6 percent linked quarter to 144,000,000 dollars The net interest margin expanded 17 basis points during the quarter to 3.38%. Revenue from continuing operations increased 4.1% linked quarter, and noninterest income from continuing operations represented 21.3 percent of total revenue. Speaker 200:06:13Diligent expense management continues to be a focus of the organization and non interest expense declined 1.1% linked quarter. Given the mortgage loan sale, key takeaways include non accrual loans declining 55% and net charge offs excluding the mortgage loan sales totaled $3,000,000 representing 9 basis points of average loans. The allowance for credit losses represented 1.18 percent of loans held for investment and 8 40% of non accrual loans, excluding individually analyzed loans at June 30. Trustmark's capital ratios expanded meaningfully during the quarter as tangible equity to tangible assets increased 105 basis points to 8.52%, while CET1 ratio expanded 80 basis points to 10.92 percent and total risk based capital expanded 87 basis points to 13.29 percent. The 2nd quarter was fundamentally strong and the actions taken during the quarter were designed to enhance our profitability profile going forward. Speaker 200:07:34Turning to Slide 6, we expect loans held for investment and deposits to grow single digits for the full year 2024. Securities balances are expected to remain stable as we reinvest cash flows. We anticipate net interest income to increase to low single digits in 2024, reflecting continuing asset growth, stabilizing deposit costs and accretion from balance sheet repositioning, resulting in full year 2024 net interest margin of approximately 3.4% based on the market implied forward interest rates. We expect the net interest margin to be in the range of 3.55% to 3.60% in the second half of twenty twenty four. From a credit perspective, the provision for credit losses, including unfunded commitments, is dependent upon credit quality trends, current macroeconomic forecast and future loan growth. Speaker 200:08:37Net charge offs from continuing operations are expected to remain below the industry average based on the current economic outlook. Noninterest income from continuing operations in the second half of twenty twenty four is expected to increase low single digits compared to the first half of twenty twenty four. The year when compared to the first half of twenty twenty four. We will continue our disciplined approach to capital deployment with a preference for organic loan growth, potential market expansion, M and A or other general corporate purposes depending on market conditions. We also continue to assess the Board of Directors approved 2024 share repurchase program as the market and balance sheet dictate. Speaker 200:09:35At this time, Barry Harvey is going to provide some color on our loan portfolio and credit quality. Speaker 300:09:41Thank you, Duane. I'll be glad to. Turning to Slide 7, loans held for investments totaled $13,200,000,000 as of June 30. That's an increase, as Duane mentioned, of $97,000,000 for the quarter. Loan growth during Q2 came from commercial real estate and the equipment finance line of business. Speaker 300:10:03We expect loan growth of low single digits for 2024. As you can see, our loan portfolio remains diversified both from a product standpoint as well as a geography. Looking on to Slide 8, Trustmark's CRE portfolio is 94% vertical with 69% in the existing category and 31% in construction land development. Our construction land development portfolio is 82% construction. Trustmark's office portfolio as you can see is very modest at $279,000,000 outstanding, which represents only 2% of our overall loan book. Speaker 300:10:44The portfolio was comprised of credits with high quality tenants, low lease turnover, strong occupancy levels and low leverage. On Slide 9, the bank's commercial portfolio is well diversified as you can see across numerous industries with no single category exceeding 15%. Looking at Slide 10, our provision for credit losses for loans held for investment was $23,300,000 during the Q2. Excluding the mortgage loan sale, the provision for credit losses for loans held for investment was $14,700,000 which was driven by 2 parts, 1, loan growth as well as risk rate migration. The provision for credit losses for off balance sheet credit exposure was a negative 3,600,000 dollars which resulted primarily from a decline in unfunded CRE commitments. Speaker 300:11:47At June 30, the allowance for credit losses for loans held for investment was $155,000,000 Looking on Slide 11, we continue to post solid credit quality metrics. The allowance for credit losses represents 1.18% of loans held for investment and 8 40 percent of non accruals excluding those that are individually analyzed. In the Q2, net charge offs totaled $11,600,000 Excluding the previously referenced mortgage loan sale, net charge offs totaled $3,000,000 or 9 basis points of average loans. Both non accruals and non performing assets decreased significantly during the quarter as a result of the mortgage loan sale. Duane? Speaker 200:12:39Okay. Thanks, Barry. Now Tom Owens will cover deposits, net interest margin and non interest income. Speaker 400:12:46Thanks, Duane, and good morning, everyone. Turning to deposits on Slide 12. We had another good quarter, which continued to show the strength of our deposit base. Deposits totaled $15,500,000,000 at June 30, a linked quarter increase of $124,000,000 or 0.8 10 percent to 1 percent a year over year increase of $549,000,000 or 3.7 percent. The linked quarter increase was driven by growth of $114,000,000 in non interest bearing DDA balances, which remained at 20% of our deposit base. Speaker 400:13:23Time deposits also increased by $90,000,000 linked quarter, driven by $77,000,000 of growth in personal CDs and $13,000,000 of growth in brokered CDs. As of June 30, our promotional and exception price time deposit book totaled $1,500,000,000 with a weighted average rate paid of $4.98 and a weighted average remaining term of about 5 months. Our broker deposit book totaled $600,000,000 had an all in weighted average rate paid, which remained at about 5 0.43%, and the weighted average remaining term remained at about 3 months as of June 30. Our cost of interest bearing deposits increased by 1 basis point from the prior quarter to 2.75%, down from the 7 basis point linked quarter increase in the 2nd quarter. Turning to Slide 13. Speaker 400:14:21Trustmark continues to maintain a stable granular and low exposure deposit base. During the Q1, we had an average of about 460,000 personal and non personal deposit accounts, excluding collateralized public fund accounts, with an average balance per account of about $27,000 As of June 30, 64% of our deposits were insured and 14% were collateralized, meaning that our mix of deposits that are uninsured and uncollateralized was essentially unchanged linked quarter at 22%. We continue to maintain substantial secured borrowing capacity, which stood at $6,100,000,000 at June 30, representing 179% coverage on uninsured and uncollateralized deposits. Our 2nd quarter total deposit cost was unchanged linked quarter at 2.18 percent, which continues to represent the cumulative beta cycle to date of 40%. The favorable variance to prior guidance was driven by pricing actions we've taken during the Q1, which gave us a running start toward a lower deposit cost in the Q2. Speaker 400:15:36Deposit cost has, however, continued to increase monthly and as a frame of reference for the guide to 2.27% in the 3rd quarter, which would bring the cycle to date to 44%, deposit cost is approximately 2.25% month to date in July. Turning our attention to revenue on Slide 14, net interest income FTE increased $8,100,000 linked quarter, totaling $144,300,000 which resulted in a net interest margin of 3.38%. Net interest margin increased by 17 basis points linked quarter, driven by 13 basis points of accretion from loan rated volume and 5 basis points of accretion from the securities portfolio restructuring. With respect to the loan rate accretion, loan fees normalized during the Q2 from the unusual drop we had experienced during the Q1. Absent the linked quarter volatility in loan fees, loan yields continue to trend higher by mid single digit basis points each quarter. Speaker 400:16:46As Lainie indicated, we anticipate net interest margin of 3.55% to 3.60% in the second half of twenty 24, with the increase driven by the securities portfolio restructuring, which was completed during June, resulting in an anticipated securities portfolio yield of approximately 3.5% going forward. We were pleased with the execution of the securities portfolio restructuring in what was a challenging interest rate environment, and we did achieve our objectives with the restructuring of extending effective duration from about 3 point 7 years to about 4.2 years. We adjusted mix to achieve more consistent ladder of cash flows over time, while also improving the stability of cash flows to changes in interest rates, while picking up approximately 350 basis points of yield between securities purchased and securities sold. Turning to Slide 15. Our interest rate risk profile remained essentially unchanged at June 30. Speaker 400:17:54We continue to substantial asset sensitivity driven by loan portfolio mix with 51% variable rate coupon. During the Q2, we entered into $60,000,000 notional of forward starting interest rate swaps, which brought the swap portfolio notional at quarter end to $1,165,000,000 with a weighted average maturity of 3 years and a weighted average received fixed rate of 3.23%. We also entered into $30,000,000 notional of forward starting floors, which brought the floor portfolio notional at quarter end to $150,000,000 with a weighted average maturity of 4.3 years at a weighted average SOFR rate of 3.68%. The cash hedging program substantially reduces our adverse asset sensitivity to potential downward stock and interest rates. Turning to Slide 16, non interest income from adjusted continuing operations totaled 38 $200,000 in the 2nd quarter, a $1,100,000 linked quarter decrease and approximately $400,000 year over year increase. Speaker 400:19:07The linked quarter decrease was driven by a $3,400,000 increase in negative net hedge ineffectiveness, which was driven by a higher assumed discount rate applied to mortgage servicing cash flows and the asset valuation methodology. Excluding the increase in negative net hedging effectiveness, linked quarter increase in total non interest income would have been $2,300,000 or 5 0.8 percent and the year over year increase would have been $3,600,000 or 9.4%. And now I'll ask Tom Chambers to cover non interest expense and capital management. Speaker 100:19:44Thank you, Tom. Turning to Slide 17, we'll see a detail of our total non interest expense. During the Q2, non interest expense continued to decline and totaled $118,300,000 a linked quarter decrease of $1,300,000 or 1.1%. This decline was mainly driven by a decrease in salary and benefits of $600,000 resulting in reduced compensation expense and a seasonal decline in payroll taxes, offset by increased commission expense driven by increased revenue. Other expense decreased by $900,000 resulting from lower operational losses during the quarter. Speaker 100:20:26Turning to Slide 18, Trustmark remains well positioned from a capital perspective. As Duane previously mentioned, our capital ratios remain solid with a common equity Tier 1 ratio of 10.92%, a linked quarter increase of 80 basis points and a total risk based capital ratio of 13.29%, a linked quarter increase of 87 basis points. Although we currently have a $50,000,000 share repurchase program in place, our priority for capital deployment continues to be focused on organic lending. As Duane indicated, we will continue to evaluate the share repurchase program as a market and our capital levels dictate. Speaker 200:21:09Back to you, George. Great. Thanks, Tom. A very, very busy quarter for us here. So we'll now open the floor up for questions that you may have. Operator00:21:53And the first question will come from Catherine Mealor with KBW. Please go ahead. Speaker 500:21:59Thanks. Good morning. Speaker 200:22:00Good morning, Catherine. Speaker 500:22:03I wanted to start on some of the guidance that you provided, which is really helpful just to look at it on continuing operations and then kind of a growth rate to the back half of the year. So thank you for how you laid that out. I think with expenses, if you take the first half of the year and then grow that at a low single digit pace, I'm getting kind of a run rate in the back half of the year around kind of 120 $2,000,000 $123,000,000 a quarter, which is a little bit higher than the first half. Just want to make sure that that's around what you're thinking and where some of that growth is coming from? Speaker 200:22:37Catherine, I'll start, Tom. Chambers can continue on. But yes, I think general, of the things that occur in the Q1 and Q2 will not continue into the second half of the year. So we do think we'll get a little bit of growth comparing first half to second half and it is in the very low single digit range. Tom can elaborate a little more, but yes, I think you're about right with your numbers. Speaker 200:23:05Tom? Speaker 100:23:07Yes. Duane, thank you. I believe the biggest driver of the increase in the second half of the year is we changed our merit increase structure. We used to have merit increases hit during March of the year and we delayed that this year to hit in July. So the first half of the year did not have merit increases in our salaries and the second half of the year will. Speaker 300:23:31So that will be the biggest, but it still keeps it Speaker 200:23:33in that low, very low single digit range. Yes, sir. Speaker 500:23:37Okay, great. Perfect. And everything else was made perfect sense. I'm actually not going to ask a margin question this quarter. So Tom, I'm going to you're off the hook this quarter from me. Speaker 500:23:48My second question is on the CREs, it looks like you sold the NPAs, but then built the reserve and looks like you put a lot of that in your CRE reserve. Just curious if that's just from pure conservatism or was there any negative migration in special mentioned or Speaker 400:24:03classified within your commercial Speaker 500:24:03real estate portfolio that drove that? Speaker 400:24:11Both of those. Good morning, good Speaker 300:24:11morning. Good morning. The first thought process as it relates to the selling of the mortgage book that we did was, those are that's most all that's 30 year paper and once it gets into that category of non accrual and there is a high roll rate from prepayments down and more, it's kind of sticky and hard to remove. And we thought in today's environment, while it's still attractive, it'd be a good time to go ahead and give ourselves some additional room as it relates to NPLs and NPAs. As it relates to your second part of your question as regarding the risk rate migrations driving some of the provisioning, that is correct. Speaker 300:24:56I mean, we like all banks on the CRE side are beginning to see some risk rate migration as it relates to predominantly special mention and occasionally there's some that's going to be substandard. We don't really see this as anything other than a cycle at this stage that we're flowing through. But of course, when you have the rate increases we have coming out of what was put on the books in the second half of really, really all of 'twenty three and then most all of 'twenty two, if not all of 'twenty two, that population is going to be more challenged just because it was made the lowest lowest rate environment and then now it's functioning because all of ours are variable rate that I'm referencing. It's functioning and it's always been functioning in the higher rate environment. So there is more stress on the category of lending, not just for Trustmark, but anybody who was booking those type of CRE loans during that window of time that are now beginning to reach CO and in many cases beginning to stabilize, there is the need to continue to support those projects by the sponsor, by the guarantors, by the borrowers in order to give them a little bit more time to fully stabilize. Speaker 300:26:19It's also a function of most construction projects for quite a while, very seldom do they finish on time. So they need a little more time to fully stabilize. And sometimes that's 6 months, sometimes that's 12 months. So it's all those factors that are going into making sure we're staying on top of our credits, making sure we're grading them appropriately at all times. I wouldn't call it conservatism. Speaker 300:26:43I would just say that we're very focused on making sure that we're looking at as much of the book as often as we can to make sure the grades are right at all times, which would lead you to believe the ACL is accurate at all times as well. Speaker 500:26:57Okay. That's great. Do you have the balances of increase in criticized or classified? Speaker 300:27:05We don't report those in our earnings traditionally. There will be of course, there will be in the call report. Speaker 500:27:11Okay. That's great. We can wait for that. So it seems like the lost content perhaps is still arguably low on these projects, but you're more just migrating them to special mentioned if there needs to be support from the guarantor just because of a project delay? Speaker 300:27:29That's correct. That's the correct assessment, Catherine. We don't see our this quarter charge offs for $3,000,000 when you exclude the mortgage sale, which is obviously one time. That's versus $4,000,000 last quarter. So we don't really see a trend developing there that that's a concern. Speaker 300:27:47We don't see a trend developing in our NPAs or NPLs of concern, but we do want to make sure the grading is correct on all of our credits and we would expect those to cycle like especially if we got any type of rate reductions second half of this year or next year. Obviously, any of those would be some welcome relief in terms of trying to meet those debt service coverage ratio requirements. Speaker 500:28:14Great. Thank you very much for the color, Barry. Operator00:28:22Our next question will come from Gary Tenner with D. A. Davidson. Please go ahead. Speaker 600:28:28Thanks. Good morning. Speaker 200:28:29Good morning, guys. Speaker 600:28:30I wanted to ask about the guide on deposit costs for the Q3. I guess I'm a little surprised that it's the guide is that much higher just given the success on the non interest bearing front in the second quarter and generally moderating deposit cost increases in the industry overall. So you had alluded to some actions you took to set yourselves up better for lower rates. I'm curious kind of what impact that's having on the 3rd quarter outlook? Speaker 400:29:03Yes. Good morning, Gary. This is Tom Owens. So, good question. Coming into 2024, early in Q1, we began to take some actions to try and rationalize our deposit costs, particularly as it related to maturing promotional CDs, as well as some rates on non maturity products. Speaker 400:29:30And what we found, I don't want to say that was experimental, right, but I think all banks at this point are focused on their deposit base and what the opportunities are to try and rationalize cost. And so we did try some of that in the Q1. And what we found is we were driving more deposit mix change and more deposit disintermediation than we would have liked. And so we got into approximately mid March and we really sort of pivoted away from that. And so that's what I mean by the actions we had taken in the Q1, which set us up for a good running start, so to speak, towards beating on the guide that we had put out there for the Q2. Speaker 400:30:17But at the same time, knowing that those deposit costs would continue to march higher going forward. And that's what we've seen. So I would really encourage you and analysts and investors to think in terms of whether we're talking about loan yield or deposit cost, it's think in terms of mid single digit increases on a normalized basis. We had a sort of a hiccup in terms of our loan yields in the Q1 on a linked quarter basis, which was the result of sort of an unusual decrease in loan fees, that normalized for us here in the Q2, right? And so you saw what is seemingly a disproportionately large increase on a linked quarter basis in loan yield in the Q2, that was normalization. Speaker 400:31:15And our guide in terms of deposit costs for the Q3 is also normalization. We're in relative equilibrium at this point on a month over month basis and on a linked quarter basis in terms of Speaker 600:31:38Thanks a lot for those thoughts, Barry. I guess if I were to boil it down to thinking that the Q3 outlook on deposit cost is almost is basically then normalized and you kind of skipped over the 2nd quarter from a repricing perspective? Is that kind Speaker 300:31:52of what it falls? Speaker 200:31:53Absolutely. And that's Speaker 400:31:54exactly right, Gary. And that's why in my prepared comments, I gave you the reference point of month to date deposit cost here in July of 2.25 Speaker 600:32:05percent. Okay. I appreciate that. And then if I could ask a follow-up just on capital. You've talked about kind of the priorities of organic growth, etcetera, but pushing an 11% CET1 ratio. Speaker 600:32:21I wonder if you could talk about capital really more from an M and A perspective, kind of where things are in terms of conversations? Has there been any sort of increase in conversations in your footprint and activity levels? Speaker 200:32:40I'll start, others can add if they need to. As it relates to M and A, I mean, first of all, yes, there are more there's a little more activity out there and things we're hearing about and things that are being presented to us as opportunities, etcetera. So we are seeing some increased activity there. In our minds, I think we wanted to get through this quarter with a lot of noise and activity and all these different one time deals kind of let the dust settle. And then really moving in to 2025 more thinking about the M and A space in a little more with a little more focus and the like. Speaker 200:33:24But at the end of the day, I do believe there is a little more activity or at least a lot of different discussions and thought processes going on across our marketplace. Speaker 400:33:38Thank you. Operator00:33:43This concludes our question and answer session. I would like to turn the conference back over to Mr. Duane Dewey for any closing remarks. Please go ahead, sir. Speaker 200:33:52Thank you again for joining us this morning. Very, very busy quarter for us and we're very excited about the second half of twenty twenty four. And we look forward to our Q3 call in October. So look forward to catching up then. Thank you. Operator00:34:12The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.Read morePowered by