Executive Summary
Winchester Bancorp delivered a Q3 2023 results profile characterized by topline growth but compressed margins and modest profitability. Revenue for the quarter was $9.52 million, up sequentially from Q2, supported by a 3-quarter run rate that aggregates to approximately $26.39 million in 2023 through Q3. However, operating leverage remained limited as rising funding costs weighed on earnings: operating income was $0.173 million and net income was $0.192 million, yielding an EPS of $0.0203. The EBITDA of $0.369 million implies a lean bottom line despite revenue gains, with EBITDA margin around 3.9% for the quarter.
Key Performance Indicators
Key Insights
Revenue progression: Q1 2023 = $7.99m; Q2 2023 = $8.88m; Q3 2023 = $9.52m. QoQ growth: Q2 vs Q1 +11.1%; Q3 vs Q2 +7.2%. Gross margin: Q1 48.75%, Q2 43.68%, Q3 40.39% (declining trend due to rising cost of revenue relative to sales). Operating margin: Q1 3.21%, Q2 3.69%, Q3 1.82% (compression driven by higher operating leverage and costs). Net income margin: Q1 2.66%, Q2 3.07%, Q3 2.02%. Interest expense: Q1 $4.031m; Q2 $4.925m; Q3 $5.575m (significant funding costs underpinning profitability). E...
Financial Highlights
Revenue progression: Q1 2023 = $7.99m; Q2 2023 = $8.88m; Q3 2023 = $9.52m. QoQ growth: Q2 vs Q1 +11.1%; Q3 vs Q2 +7.2%. Gross margin: Q1 48.75%, Q2 43.68%, Q3 40.39% (declining trend due to rising cost of revenue relative to sales). Operating margin: Q1 3.21%, Q2 3.69%, Q3 1.82% (compression driven by higher operating leverage and costs). Net income margin: Q1 2.66%, Q2 3.07%, Q3 2.02%. Interest expense: Q1 $4.031m; Q2 $4.925m; Q3 $5.575m (significant funding costs underpinning profitability). EBITDA: Q3 $0.369m, margin ~3.87% of revenue; EPS: $0.0203 (diluted). Weighted average shares: 9.446m. Coverage highlights show a narrow margin framework with a heavy interest expense burden relative to operating earnings, suggesting a funding-cost sensitivity regime in a rising-rate environment.
Income Statement
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Management Commentary
No earnings call transcript was provided in the data. Management commentary themes could plausibly include funding costs, loan growth, asset quality, and expense management, but no direct quotes are available from an official transcript in the current dataset.
No earnings call transcript available in the provided data.
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Forward Guidance
No formal forward guidance was disclosed in the provided data. Given the current metrics, the key drivers for Winchester Bancorp will be: (1) net interest income sensitivity to rate moves and funding costs, (2) ability to grow loans and deposits at a sustainable pace, (3) continued control of non-interest expenses to offset elevated interest expense, and (4) asset quality and reserve development. Investors should monitor funding costs, deposit betas, and loan-officer productivity, as well as any regulatory capital guidance that could affect balance sheet expansion capacity. If rate stability returns and funding costs moderate, margins could improve; otherwise, profitability may remain constrained in the near term.