FRAFHIGH SIGNALFINANCIAL10-K

FRAF reported substantially higher net income alongside strong net interest income growth, while significantly reducing its cash position.

The dramatic improvement in profitability suggests either exceptional operational performance or potential one-time gains that warrant closer examination of the underlying drivers. The substantial reduction in cash and equivalents from $203.6M to $127.7M, combined with increased share buybacks, indicates active capital deployment that materially altered the balance sheet composition.

Comparing 2026-03-13 vs 2025-03-14View on EDGAR →
FINANCIAL ANALYSIS

FRAF demonstrated strong fundamental performance with net interest income growing 12.7% to $114.4M and operating cash flow increasing 16.9% to $25.4M. Net income roughly doubled, representing a substantial improvement in profitability that significantly outpaced revenue growth. The company deployed excess cash aggressively, reducing cash holdings by 37% while increasing stockholders equity 21% and modestly expanding share repurchases, suggesting confident capital allocation amid strong earnings performance.

FINANCIAL STATEMENT CHANGES
Net Income
P&L
+91.2%
$11.1M→$21.2M

Net income grew 91.2% — bottom-line growth signals improving overall business health.

Capital Expenditure
Cash Flow
-44.4%
$1.0M→$579K

Capex reduced 44.4% — investment cycle winding down or capital discipline; may improve near-term free cash flow.

Cash & Equivalents
Balance Sheet
-37.3%
$203.6M→$127.7M

Cash declined 37.3% — significant cash burn or deployment; verify adequacy of remaining liquidity runway.

Share Buybacks
Cash Flow
+33.5%
$827K→$1.1M

Share repurchases increased 33.5% — management returning capital, signals confidence in intrinsic value.

Stockholders Equity
Balance Sheet
+21.1%
$144.7M→$175.2M

Equity base grew 21.1% — retained earnings accumulation or equity issuance strengthening the balance sheet.

Operating Cash Flow
Cash Flow
+16.9%
$21.8M→$25.4M

Operating cash flow grew 16.9% — strong conversion of earnings to cash, healthy business fundamentals.

Net Interest Income
P&L
+12.7%
$101.5M→$114.4M

Net interest income grew 12.7% — benefiting from rate environment or loan book expansion.

LANGUAGE CHANGES
NEW — 2026-03-13
PRIOR — 2025-03-14
ADDED
There were 4,482,893 outstanding shares of the Registrant's common stock as of February 28, 2026.
Management's Discussion and Analysis of Financial Condition and Results of Operations 20 Item 7A.
The Corporation conducts substantially all of its business through its wholly owned direct banking subsidiary, F M Trust.
It also provides investment and trust services through its Wealth Management segment.
F M Trust, through licensed members of its Wealth Management department, sells mutual funds, annuities and selected insurance products.
Some competitors may have access to resources (e.g., financial and technological) greater than, and more quickly than, are available to the Bank, or that may be unavailable to the Bank, thereby creating a competitive disadvantage for the Bank in terms of product, service pricing and delivery.
Employee engagement, defined as the enthusiasm and commitment individuals have toward their work and the company, is a key priority for us.
In 2025, we achieved an outstanding 93% response rate, marking the eighth consecutive year of best-in-class participation.
Our wellness program boasts high levels of employee participation, with over 51% of our workforce completing health risk assessments and 71% completing biometric screenings in 2025.
In 2025, F M Trust donated over $785 thousand to 324 organizations in our communities and funded 341 scholarships for $318 thousand to kindergarten through 12th grade, Pre-kindergarten schools and organizations through the Pennsylvania Educational Improvement Tax Credit program.
REMOVED
There were 4,440,442 outstanding shares of the Registrant's common stock as of February 28, 2025.
Management's Discussion and Analysis of Financial Condition and Results of Operations 19 Item 7A.
The Corporation conducts substantially all of its business through its wholly-owned direct banking subsidiary, F M Trust.
It also has a location in Dauphin County, PA that serves as a regional support center for Commercial, and Wealth Management services.
F M Trust through licensed members of its Wealth Management Department sells mutual funds, annuities and selected insurance products.
Some competitors may have access to resources (e.g., financial and technological) sooner than they are available to the Bank, or that may be unavailable to the Bank, thereby creating a competitive disadvantage for the Bank in terms of product, service pricing and delivery.
Employee engagement defined as the enthusiasm and commitment individuals have toward their work and the company is a key priority for us.
In 2024, we achieved an outstanding 94% response rate, marking the seventh consecutive year of best-in-class participation.
Our wellness program boasts high levels of employee participation, with over 75% of our workforce completing health risk assessments and 72% completing biometric screenings in 2024.
In 2024, F M Trust donated over $591 thousand to 325 organizations in our communities and funded 392 scholarships for $227 thousand to kindergarten through 12th grade and Pre-kindergarten schools and organizations through the Pennsylvania Educational Improvement Tax Credit program.
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