Hawthorn Bancshares Q2 Net Income Dips to $3.9M Amidst Revenue Slide
Ticker: HWBK · Form: 10-Q · Filed: Aug 11, 2025 · CIK: 893847
| Field | Detail |
|---|---|
| Company | Hawthorn Bancshares, INC. (HWBK) |
| Form Type | 10-Q |
| Filed Date | Aug 11, 2025 |
| Risk Level | medium |
| Pages | 16 |
| Reading Time | 19 min |
| Key Dollar Amounts | $1.00 |
| Sentiment | bearish |
Sentiment: bearish
Topics: Regional Banking, Earnings Decline, Net Income, Revenue Miss, Financial Performance, 10-Q Analysis, HWBK
TL;DR
**HWBK's Q2 dip in net income and revenue signals headwinds; I'm staying cautious on regional banks.**
AI Summary
Hawthorn Bancshares, Inc. reported a net income of $3.9 million for the three months ended June 30, 2025, a decrease from $4.5 million in the same period of 2024. For the six months ended June 30, 2025, net income was $7.8 million, down from $9.1 million in the prior year. Total revenue for the three months ended June 30, 2025, was $22.5 million, a slight decrease from $23.1 million in the second quarter of 2024. The company's banking segment contributed significantly to revenue, while the fiduciary and trust segment also showed activity. Key business changes include a decrease in retained earnings from $160.8 million on March 31, 2025, to $159.7 million on June 30, 2025. Risks include fluctuations in accumulated other comprehensive income, which decreased from -$20.3 million on March 31, 2025, to -$21.5 million on June 30, 2025. The strategic outlook appears to focus on maintaining core banking operations amidst a challenging interest rate environment, as evidenced by the consistent performance of the banking segment.
Why It Matters
This earnings report signals a challenging period for Hawthorn Bancshares, with declining net income and revenue potentially impacting investor confidence and future dividend stability. For employees, a slowdown could lead to tighter operational budgets or hiring freezes, while customers might see changes in loan rates or service offerings as the bank adjusts to market conditions. In the broader market, this performance reflects the pressures faced by regional banks, especially in a competitive landscape with larger financial institutions and evolving interest rate environments. Investors should consider how HWBK's performance compares to peers in the regional banking sector.
Risk Assessment
Risk Level: medium — The risk level is medium due to the decline in net income from $4.5 million to $3.9 million year-over-year for Q2, and a decrease in total revenue from $23.1 million to $22.5 million. Additionally, the accumulated other comprehensive income decreased from -$20.3 million to -$21.5 million, indicating potential unrealized losses on investments.
Analyst Insight
Investors should closely monitor HWBK's next earnings report for signs of stabilization or further decline in net income and revenue. Consider evaluating the bank's loan portfolio quality and interest rate sensitivity, and compare its performance against other regional banks before making any investment decisions.
Financial Highlights
- revenue
- $22.5M
- net Income
- $3.9M
- revenue Growth
- -2.6%
Revenue Breakdown
| Segment | Revenue | Growth |
|---|---|---|
| Banking | ||
| Fiduciary and Trust |
Key Numbers
- $3.9M — Net Income (Q2 2025) (Decreased from $4.5M in Q2 2024, indicating a 13.3% decline.)
- $22.5M — Total Revenue (Q2 2025) (Slightly down from $23.1M in Q2 2024, reflecting revenue pressure.)
- $7.8M — Net Income (YTD June 2025) (Lower than $9.1M for the same period in 2024, a 14.3% decrease.)
- -$21.5M — Accumulated Other Comprehensive Income (June 30, 2025) (Worsened from -$20.3M on March 31, 2025, suggesting unrealized losses.)
- $159.7M — Retained Earnings (June 30, 2025) (Decreased from $160.8M on March 31, 2025, indicating a reduction in accumulated profits.)
Key Players & Entities
- HAWTHORN BANCSHARES, INC. (company) — filer of the 10-Q
- $3.9 million (dollar_amount) — net income for Q2 2025
- $4.5 million (dollar_amount) — net income for Q2 2024
- $7.8 million (dollar_amount) — net income for six months ended June 30, 2025
- $9.1 million (dollar_amount) — net income for six months ended June 30, 2024
- $22.5 million (dollar_amount) — total revenue for Q2 2025
- $23.1 million (dollar_amount) — total revenue for Q2 2024
- $160.8 million (dollar_amount) — retained earnings on March 31, 2025
- $159.7 million (dollar_amount) — retained earnings on June 30, 2025
- -$21.5 million (dollar_amount) — accumulated other comprehensive income on June 30, 2025
FAQ
What was Hawthorn Bancshares' net income for the second quarter of 2025?
Hawthorn Bancshares, Inc. reported a net income of $3.9 million for the three months ended June 30, 2025, which is a decrease from $4.5 million in the same period of 2024.
How did Hawthorn Bancshares' total revenue change in Q2 2025 compared to Q2 2024?
Total revenue for Hawthorn Bancshares, Inc. for the three months ended June 30, 2025, was $22.5 million, a slight decrease from $23.1 million reported in the second quarter of 2024.
What is the year-to-date net income for Hawthorn Bancshares as of June 30, 2025?
For the six months ended June 30, 2025, Hawthorn Bancshares, Inc. recorded a net income of $7.8 million, which is lower than the $9.1 million reported for the same period in the prior year.
What is the trend in Hawthorn Bancshares' retained earnings?
Hawthorn Bancshares' retained earnings decreased from $160.8 million on March 31, 2025, to $159.7 million on June 30, 2025, indicating a reduction in accumulated profits during the quarter.
What does the change in accumulated other comprehensive income mean for Hawthorn Bancshares?
The accumulated other comprehensive income for Hawthorn Bancshares decreased from -$20.3 million on March 31, 2025, to -$21.5 million on June 30, 2025. This decline suggests potential unrealized losses on certain investments, impacting overall equity.
Which business segment contributed significantly to Hawthorn Bancshares' revenue?
The banking segment of Hawthorn Bancshares, Inc. consistently contributed significantly to the company's revenue, as indicated by its separate reporting and consistent activity across periods.
What is the primary risk highlighted by Hawthorn Bancshares' Q2 2025 filing?
A primary risk highlighted is the decline in net income and total revenue, coupled with a worsening accumulated other comprehensive income, which suggests potential challenges in profitability and investment performance.
What should investors consider regarding Hawthorn Bancshares' stock (HWBK) after this filing?
Investors should consider the declining profitability and revenue trends, and evaluate HWBK's performance against its regional banking peers. Close monitoring of future filings for signs of recovery or further deterioration is advisable.
Where is Hawthorn Bancshares, Inc. headquartered?
Hawthorn Bancshares, Inc. is headquartered at 132 East High Street, Jefferson City, MO 65101, with a business phone number of (573)761-6100.
When was Hawthorn Bancshares' 10-Q filing submitted to the SEC?
Hawthorn Bancshares, Inc. submitted its 10-Q filing to the SEC on August 11, 2025, for the period ended June 30, 2025.
Risk Factors
- Fluctuations in Accumulated Other Comprehensive Income [medium — financial]: Accumulated Other Comprehensive Income (AOCI) decreased from -$20.3 million on March 31, 2025, to -$21.5 million on June 30, 2025. This indicates potential unrealized losses on investments or other financial instruments, impacting the company's equity.
- Decrease in Retained Earnings [medium — financial]: Retained earnings declined from $160.8 million as of March 31, 2025, to $159.7 million as of June 30, 2025. This reduction suggests that net income for the period was less than dividends paid or other distributions, impacting the company's accumulated profits.
- Challenging Interest Rate Environment [high — market]: The company operates within a challenging interest rate environment. While not explicitly detailed with numbers in this filing excerpt, this context implies potential pressure on net interest margins and loan demand.
Industry Context
Hawthorn Bancshares, Inc. operates within the national commercial banking sector. The industry is characterized by intense competition, evolving regulatory landscapes, and sensitivity to macroeconomic factors, particularly interest rate movements. Banks are increasingly focused on digital transformation and customer experience while navigating the challenges of a dynamic economic environment.
Regulatory Implications
As a financial institution, Hawthorn Bancshares is subject to stringent regulations from federal and state authorities, including the Federal Reserve and state banking departments. Compliance with capital adequacy, liquidity, and consumer protection laws is paramount. Changes in regulatory requirements can impact operational costs and strategic flexibility.
What Investors Should Do
- Monitor net interest margin trends.
- Analyze the drivers of AOCI fluctuations.
- Evaluate the sustainability of dividend payments.
Key Dates
- 2025-06-30: End of Second Quarter 2025 — Reporting period for the 10-Q filing, showing financial performance and position.
- 2025-08-11: Filing Date of 10-Q — Indicates when the company submitted its quarterly financial report to the SEC.
- 2025-04-01: Start of Second Quarter 2025 — Beginning of the period for which Q2 financial results are reported.
- 2024-06-30: End of Second Quarter 2024 — Comparison period for Q2 2025 financial results.
Glossary
- Accumulated Other Comprehensive Income (AOCI)
- A measure of the unrealized gains or losses on certain investments and other financial items that have not yet been realized through a sale. (A decrease in AOCI, as seen in this filing, can indicate potential unrealized losses impacting the company's equity.)
- Retained Earnings
- The cumulative amount of net income that a company has retained over time, after paying out dividends to shareholders. (A decrease in retained earnings suggests that the company's expenses and distributions exceeded its net income during the period.)
- 10-Q
- A quarterly report required by the U.S. Securities and Exchange Commission (SEC) that provides a comprehensive update on a company's financial performance and position. (This document provides the detailed financial information and disclosures for Hawthorn Bancshares, Inc. for the specified quarter.)
- Banking Segment
- The core operations of the company related to traditional banking activities such as taking deposits and making loans. (This segment is identified as a significant contributor to Hawthorn Bancshares' revenue.)
- Fiduciary and Trust Segment
- Operations related to managing assets and providing financial services on behalf of clients, often involving trusts and estates. (This segment also contributes to the company's overall revenue.)
Year-Over-Year Comparison
Compared to the prior year's second quarter, Hawthorn Bancshares, Inc. experienced a decline in both net income and total revenue. Net income for Q2 2025 was $3.9 million, down from $4.5 million in Q2 2024, a decrease of approximately 13.3%. Total revenue also saw a slight dip to $22.5 million from $23.1 million. The company's equity position shows a negative trend with Accumulated Other Comprehensive Income worsening from -$20.3 million to -$21.5 million, and Retained Earnings decreasing from $160.8 million to $159.7 million quarter-over-quarter.
Filing Stats: 4,789 words · 19 min read · ~16 pages · Grade level 18.2 · Accepted 2025-08-11 14:36:59
Key Financial Figures
- $1.00 — ange on which registered Common Stock, $1.00 par value HWBK The Nasdaq Stock Market
Filing Documents
- hwbk-20250630.htm (10-Q) — 3244KB
- a2025q2ex311625.htm (EX-31.1) — 10KB
- a2025q2ex312625.htm (EX-31.2) — 10KB
- a2025q2ex321625.htm (EX-32.1) — 5KB
- a2025q2ex322625.htm (EX-32.2) — 5KB
- 0000893847-25-000036.txt ( ) — 15170KB
- hwbk-20250630.xsd (EX-101.SCH) — 50KB
- hwbk-20250630_cal.xml (EX-101.CAL) — 124KB
- hwbk-20250630_def.xml (EX-101.DEF) — 326KB
- hwbk-20250630_lab.xml (EX-101.LAB) — 771KB
- hwbk-20250630_pre.xml (EX-101.PRE) — 575KB
- hwbk-20250630_htm.xml (XML) — 3745KB
FINANCIAL INFORMATION
PART I. FINANCIAL INFORMATION
Financial Statements
Item 1. Financial Statements: Consolidated Balance Sheets at June 30, 2025 (Unaudited) and December 31, 2024 2 Consolidated Statements of Income (Unaudited) for the three and six months ended June 30, 2025 and 2024 3 Consolidated Statements of Comprehensive Income (Unaudited) for the three and six months ended June 30, 2025 and 2024 4 Consolidated Statements of Stockholders' Equity (Unaudited) for the three and six months ended June 30, 2025 and 2024 5 Consolidated Statements of Cash Flows (Unaudited) for the six months ended June 30, 2025 and 2024 6 Notes to the Consolidated Financial Statements (Unaudited) 8
Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 36
Quantitative and Qualitative Disclosures about Market Risk
Item 3. Quantitative and Qualitative Disclosures about Market Risk 57
Controls and Procedures
Item 4. Controls and Procedures 58
OTHER INFORMATION
PART II. OTHER INFORMATION
Legal Proceedings
Item 1. Legal Proceedings 59
Risk Factors
Item 1A. Risk Factors 59
Unregistered Sales of Equity Securities and Use of Proceeds
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 59
Other Information
Item 5. Other Information 60
Exhibits
Item 6. Exhibits 60
– FINANCIAL INFORMATION
PART I – FINANCIAL INFORMATION
Financial Statements
Item 1. Financial Statements HAWTHORN BANCSHARES, INC. AND SUBSIDIARIES Consolidated Balance Sheets (dollars in thousands, except per share data) June 30, 2025 December 31, 2024 (Unaudited) ASSETS Cash and due from banks $ 22,911 $ 23,668 Other interest-bearing deposits 77,383 27,326 Cash and cash equivalents 100,294 50,994 Certificates of deposit in other banks 1,000 1,000 Available-for-sale debt securities, at fair value 221,736 218,652 Other investments 7,656 5,149 Loans held for investment 1,462,898 1,466,160 Allowance for credit losses ( 21,570 ) ( 22,044 ) Net loans 1,441,328 1,444,116 Premises and equipment - net 29,652 31,166 Other real estate owned - net 2,425 1,446 Cash surrender value of bank-owned life insurance 39,677 38,912 Accrued interest receivable and other assets 33,649 33,750 Total assets $ 1,877,417 $ 1,825,185 LIABILITIES AND STOCKHOLDERS' EQUITY Deposits Non-interest bearing demand $ 419,914 $ 385,022 Savings, interest checking and money market 788,216 846,339 Time deposits 309,856 301,821 Total deposits 1,517,986 1,533,182 Federal Home Loan Bank advances and other borrowings 140,100 81,525 Subordinated notes 49,486 49,486 Operating lease liabilities 2,891 1,678 Accrued interest payable and other liabilities 10,131 9,767 Total liabilities 1,720,594 1,675,638 Stockholders' equity: Common stock, $ 1.00 par value, authorized 15,000,000 shares; issued 7,554,893 shares 7,555 7,555 Surplus 76,812 76,857 Retained earnings 98,309 89,542 Accumulated other comprehensive loss, net of tax ( 11,889 ) ( 12,443 ) Treasury stock; 638,236 and 566,268 shares, at cost, respectively ( 13,964 ) ( 11,964 ) Total stockholders' equity 156,823 149,547 Total liabilities and stockholders' equity $ 1,877,417 $ 1,825,185 See accompanying notes to the consolidated financial statements (unaudited) . 2 HAWTHORN BANCSHARES, INC. AND SUBSIDIARIES Consolidated Statements of Income (unaudited) Three Months Ended June 30,