DOW JONES22,327.48+690.70 3.19%
S&P 5002,626.65+85.18 3.35%
NASDAQ7,774.15+271.77 3.62%

Triumph Beats Earnings Estimates, Quintuples Carrier Payments Business

Triumph Bancorp (NASDAQ: TBK) reported earnings for the fourth quarter of 2019 on Tuesday after markets closed.

Benzinga · 01/22/2020 13:45

Triumph Bancorp (NASDAQ: TBK) reported earnings for the fourth quarter of 2019 on Tuesday after markets closed.

Triumph reported net income available to shareholders of $16.7 million or earnings per share of $0.66, beating the Street's expectations of $0.63 but down 7.7% year-over-year. In the fourth quarter of 2019, Triumph bought back $14.4 million of its own stock.

As the yield curve flattened over the past year, Triumph's net interest margin (NIM) compressed to 5.72% from 6.34%  in the fourth quarter of 2018.

Total loans held for investment fell 0.4% quarter-on-quarter to $4.195 billion but grew 16.2% on a year-over-year basis.

TriumphPay, the trucking carrier payments factoring business, has grown dramatically since the fourth quarter of 2018. In the fourth quarter of 2019, TriumphPay processed 442,428 invoices for a total of $474.9 million, compared with 83,326 invoices worth $123.1 million in the fourth quarter of 2018.

Embedded in TriumphPay's payments data is a read-through to the trucking market. In the fourth quarter of 2018, TriumphPay's average invoice was $1,477; in the fourth quarter of 2019, the average invoice was worth just $1,073, a difference of 27.3%.

We believe that generally falling trucking spot rates over that period only account for about a 7.8% drop in invoice size; the rest of the difference is largely due to TriumphPay's changing customer mix as the business expanded.

Triumph has been able to improve its asset quality numbers on both a quarterly and annual basis. Nonperforming assets — defined as loans for which principal or payments are overdue by 90 days — declined 4 basis points quarter-on-quarter to 0.87% of total assets. The ratio of the past due to total loans also decreased quarter-on-quarter to 2.19%.

In the third quarter of 2018, nonperforming assets were 0.84% of total assets and the ratio of past due to total loans was 2.41%.

Image by Hyein Nam from Pixabay