What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-05-09 compared with 2025-02-10 · 265 added, 132 removed, 921 unchanged (30% of the section changed)

3 unchanged sentences

CONSOLIDATED BALANCE SHEETS

December 31, 2024 and September 30, 2024

March 31, 2025 and September 30, 2024

(Dollars in thousands, except per share amounts)

38 unchanged sentences

CONSOLIDATED BALANCE SHEETS (continued)

December 31, 2024 and September 30, 2024

March 31, 2025 and September 30, 2024

(Dollars in thousands, except per share amounts)

7 unchanged sentences

50,000,000 shares authorized;

7,954,673 shares issued and outstanding - December 31, 2024 7,960,127 shares issued and outstanding - September 30, 2024

7,903,489 shares issued and outstanding - March 31, 2025 7,960,127 shares issued and outstanding - September 30, 2024

28,028 29,862

8 unchanged sentences

CONSOLIDATED STATEMENTS OF INCOME

For the three months ended December 31, 2024 and 2023

For the three and six months ended March 31, 2025 and 2024

(Dollars in thousands, except per share amounts)

Three Months Ended December 31,

Three Months Ended March 31, Six Months Ended

2025 2024 2025 2024

Interest and dividend income

11 unchanged sentences

Provision for credit losses - loans 237 166 289 545

Recapture of credit losses - investment securities ( 5 ) ( 10 )

Recapture of credit losses - unfunded commitments ( 20 ) ( 33 )

(Recapture of) provision for credit losses - investment securities ( 5 ) 3 ( 10 ) ( 7 )

Provision for (recapture of) credit losses - unfunded commitments 14 ( 88 ) ( 7 ) ( 121 )

Total provision for credit losses - net 246 81 272 417

13 unchanged sentences

CONSOLIDATED STATEMENTS OF INCOME (continued)

For the three months ended December 31, 2024 and 2023

For the three and six months ended March 31, 2025 and 2024

(Dollars in thousands, except per share amounts)

Three Months Ended December 31,

Three Months Ended March 31, Six Months Ended

2025 2024 2025 2024

Non-interest expense

2 unchanged sentences

Advertising 189 159 370 345

OREO and other repossessed assets, net 9 — 9 —

ATM and debit card interchange transaction fees 521 601 1,043 1,216

23 unchanged sentences

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the three months ended December 31, 2024 and 2023

For the three and six months ended March 31, 2025 and 2024

(Dollars in thousands)

Three Months Ended December 31,

Three Months Ended March 31 Six Months Ended

2025 2024 2025 2024

Comprehensive income

1 unchanged sentence

Other comprehensive income (loss)

Unrealized holding (loss) gain on investment securities available for sale, net of income taxes of $( 216 ) and $ 66 , respectively

Unrealized holding gain (loss) on investment securities available for sale, net of income taxes of $ 32 , $ 22 , $( 183 ) and $ 88 , respectively

122 82 ( 690 ) 330

Change in other than temporary impairment ("OTTI") on investment securities held to maturity, net of income taxes:

Accretion of OTTI on investment securities held to maturity, net of income taxes of $ 0 , $ 0 , $ 0 and $ 2 , respectively

Total other comprehensive (loss) income, net of income taxes ( 812 ) 257

Total other comprehensive income (loss), net of income taxes 122 82 ( 690 ) 339

Total comprehensive income $ 6,877 $ 5,790 $ 12,925 $ 12,343

3 unchanged sentences

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

For the three months ended December 31, 2024 and 2023

For the three and six months ended March 31, 2025 and 2024

(Dollars in thousands, except per share amounts)

4 unchanged sentences

Earnings Total

Balance, September 30, 2023 8,105,338 $ 34,771 $ 199,386 $ ( 1,084 ) $ 233,073

Balance, December 31, 2023 8,120,708 $ 34,869 $ 203,327 $ ( 827 ) $ 237,369

Net income — — 5,708 — 5,708

5 unchanged sentences

Stock-based compensation expense — 106 — — 106

Adoption of Accounting Standards Update ("ASU") 2016-13 — — ( 488 ) — ( 488 )

Balance, March 31, 2024 8,023,121 $ 32,338 $ 207,086 $ ( 745 ) $ 238,679

Balance, December 31, 2024 7,954,673 $ 29,593 $ 220,398 $ ( 792 ) $ 249,199

Net income — — 6,755 — 6,755

Other comprehensive income — — — 122 122

Repurchase of common stock, net of tax ( 61,764 ) ( 1,908 ) — — ( 1,908 )

Restricted stock grant forfeitures ( 1,380 ) ( 11 ) — — ( 11 )

Exercise of stock options 11,960 212 — — 212

Common stock dividends ($ 0.25 per common share)

— — ( 1,987 ) — ( 1,987 )

Stock-based compensation expense — 142 — — 142

Balance, March 31, 2025 7,903,489 $ 28,028 $ 225,166 $ ( 670 ) $ 252,524

Common Stock Accumulated

Compre-hensive

Income (Loss)

Number of Shares Amount Retained

Earnings Total

Balance, September 30, 2023 8,105,338 $ 34,771 $ 199,386 $ ( 1,084 ) $ 233,073

Net income — — 12,004 — 12,004

Other comprehensive income — — — 339 339

Repurchase of common stock, net of tax ( 112,117 ) ( 3,034 ) — — ( 3,034 )

Exercise of stock options 29,900 390 — — 390

Common stock dividends ($ 0.47 per common share)

— — ( 3,816 ) — ( 3,816 )

Stock-based compensation expense — 211 — — 211

Adoption of Accounting Standards Update ("ASU") 2016-13, net of tax — — ( 488 ) — ( 488 )

Balance, March 31, 2024 8,023,121 $ 32,338 $ 207,086 $ ( 745 ) $ 238,679

Balance, September 30, 2024 7,960,127 $ 29,862 $ 215,531 $ 20 $ 245,413

Net income — — 13,615 — 13,615

Other comprehensive loss — — — ( 690 ) ( 690 )

5 unchanged sentences

Stock-based compensation expense — 283 — — 283

Balance, December 31, 2024 7,954,673 $ 29,593 $ 220,398 $ ( 792 ) $ 249,199

Balance, March 31, 2025 7,903,489 $ 28,028 $ 225,166 $ ( 670 ) $ 252,524

See notes to unaudited consolidated financial statements

2 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

For the three months ended December 31, 2024 and 2023

For the six months ended March 31, 2025 and 2024

(Dollars in thousands)

Three Months Ended December 31,

Six Months Ended March 31,

Cash flows from operating activities

Net income $ 13,615 $ 12,004

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Provision for credit losses 272 417

13 unchanged sentences

Net change in accrued interest receivable and other assets, and other liabilities and accrued expenses ( 3,976 ) ( 3,042 )

Net cash (used in) provided by operating activities ( 3,056 ) 4,867

Net cash provided by operating activities 9,298 8,975

Cash flows from investing activities

4 unchanged sentences

Proceeds from maturities and prepayments of investment securities available for sale 9,290 2,667

Purchase of FHLB stock ( 8 ) —

Redemption of FHLB stock — 1,565

6 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

For the three months ended December 31, 2024 and 2023

For the six months ended March 31, 2025 and 2024

(Dollars in thousands)

Three Months Ended December 31,

Six Months Ended March 31,

Cash flows from financing activities

Net (decrease) increase in deposits $ ( 17,252 ) $ 66,134

Net increase in deposits $ 3,162 $ 77,619

Repayment of FHLB borrowings — ( 15,000 )

3 unchanged sentences

Net cash (used in) provided by financing activities ( 2,924 ) 56,159

Net (decrease) increase in cash and cash equivalents ( 657 ) 29,300

Net increase in cash and cash equivalents 26,483 51,628

Cash and cash equivalents

2 unchanged sentences

Supplemental disclosure of cash flow information

Income taxes paid $ 3,677 $ 3,388

Interest paid $ 16,375 $ 13,473

14 unchanged sentences

The unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended September 30, 2024 (“2024 Form 10-K”).

The unaudited consolidated results of operations for the three months ended December 31, 2024 are not necessarily indicative of the results that may be expected for the entire fiscal year ending September 30, 2025.

The unaudited consolidated results of operations for the six months ended March 31, 2025 are not necessarily indicative of the results that may be expected for the entire fiscal year ending September 30, 2025.

(b) Principles of Consolidation:

The unaudited consolidated financial statements include the accounts of the Company and the Bank’s wholly-owned subsidiary, Timberland Service Corp.

The unaudited consolidated financial statements include the accounts of the Company, its wholly-owned subsidiary, the Bank, and the Bank's wholly owned subsidiary, Timberland Service Corp.

All significant inter-company transactions and balances have been eliminated in consolidation.

3 unchanged sentences

Actual results could differ from those estimates.

(e) Certain prior period amounts have been reclassified to conform to the December 31, 2024 presentation with no change to previously reported net income or total shareholders’ equity.

(e) Certain prior period amounts have been reclassified to conform to the March 31, 2025 presentation with no change to previously reported net income or total shareholders’ equity.

(2) INVESTMENT SECURITIES

Held to maturity and available for sale investment securities have been classified according to management’s intent and were as follows as of December 31, 2024 and September 30, 2024 (dollars in thousands):

Held to maturity and available for sale investment securities have been classified according to management’s intent and were as follows as of March 31, 2025 and September 30, 2024 (dollars in thousands):

Losses Estimated

Fair Value Allowance for Credit Losses

December 31, 2024

March 31, 2025

Held to Maturity

7 unchanged sentences

Total $ 140,954 $ 288 $ ( 6,860 ) $ 134,382 $ 50

December 31, 2024 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value

March 31, 2025 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value

Available for Sale

18 unchanged sentences

Total $ 72,231 $ 551 $ ( 525 ) $ 72,257

Held to maturity and available for sale investment securities with unrealized losses were as follows as of December 31, 2024 (dollars in thousands):

Held to maturity and available for sale investment securities with unrealized losses were as follows as of March 31, 2025 (dollars in thousands):

Less Than 12 Months 12 Months or Longer Total

32 unchanged sentences

$ 13,330 $ ( 118 ) 5 $ 25,751 $ ( 407 ) 23 $ 39,081 $ ( 525 )

During the three months ended December 31, 2024, the Company recorded a $ 2,000 net realized loss on 13 held to maturity investment securities, all of which had been recognized previously as a credit loss.

During the three months ended December 31, 2023, the Company recorded a $ 1,000 net realized loss on 13 held to maturity investment securities, all of which had been recognized previously as credit loss.

The recorded amount of investment securities pledged as collateral for public fund deposits, federal treasury tax and loan deposits, FHLB collateral and other non-profit organization deposits totaled $ 193.62 million and $ 208.81 million at December 31, 2024 and September 30, 2024, respectively.

The contractual maturities of investment securities at December 31, 2024 were as follows (dollars in thousands).

During the six months ended March 31, 2025, the Company recorded a $ 2,000 net realized loss on 13 held to maturity investment securities, all of which had been recognized previously as a credit loss.

During the six months ended March 31, 2024, the Company had no net realized losses on held to maturity investment securities.

The recorded amount of investment securities pledged as collateral for public fund deposits, federal treasury tax and loan deposits, FHLB collateral and other non-profit organization deposits totaled $ 202.44 million and $ 208.81 million at March 31, 2025 and September 30, 2024, respectively.

The contractual maturities of investment securities at March 31, 2025 were as follows (dollars in thousands).

Expected maturities may differ from scheduled maturities due to the prepayment of principal or call provisions.

11 unchanged sentences

The Company assesses each available for sale investment security that is in an unrealized loss position to determine whether the decline in fair value below the amortized cost basis results from a credit loss or other factors.

The Company did not record an ACL on any available for sale investment securities at December 31, 2024 or September 30, 2024.

The Company did not record an ACL on any available for sale investment securities at March 31, 2025 or September 30, 2024.

As of both dates, the Company considered the unrealized losses across the classes of major security-type to be related to fluctuations in market conditions, primarily interest rates, and not reflective of a deterioration in credit value.

12 unchanged sentences

The calculation is completed on a quarterly basis using the default studies provided by an industry leading source.

At December 31, 2024 and September 30, 2024, the ACL on the held to maturity securities portfolio totaled $ 55,000 and $ 60,000 , respectively.

The following tables set forth information for the three months ended December 31, 2024 regarding activity in the ACL by portfolio segment (dollars in thousands):

Three Months Ended December 31, 2024

Held to Maturity Beginning Allowance Provision for (Recapture of) Credit Losses Ending Allowance

At March 31, 2025 and September 30, 2024, the ACL on the held to maturity securities portfolio totaled $ 50,000 and $ 60,000 , respectively.

The following tables set forth information for the three and six months ended March 31, 2025 and 2024, respectively, regarding activity in the ACL by portfolio segment (dollars in thousands):

Three Months Ended March 31, 2025 Three Months Ended March 31, 2024

Beginning Allowance Provision for (Recapture of) Credit Losses Ending Allowance Beginning Allowance Provision for (Recapture of) Credit Losses Ending Allowance

Held to Maturity

Private label residential $ 52 $ ( 4 ) $ 48 $ 73 $ 4 $ 77

Bank issued trust preferred securities

3 ( 1 ) 2 9 ( 1 ) 8

Total $ 55 $ ( 5 ) $ 50 $ 82 $ 3 $ 85

Three Months Ended December 31, 2023

Held to Maturity Beginning Allowance Impact of Adopting CECL (ASU 2016-13) Provision for (Recapture of) Credit Losses Ending Allowance

Six Months Ended March 31, 2025 Six Months Ended March 31, 2024

Beginning Allowance Provision for (Recapture of) Credit Losses Ending Allowance Beginning Allowance Impact of Adopting CECL (ASU 2016-13) Provision for (Recapture of) Credit Losses Ending Allowance

Held to Maturity

Private label residential $ 55 $ ( 7 ) $ 48 $ — $ 82 $ ( 5 ) $ 77

Bank issued trust preferred securities

5 ( 3 ) 2 — 10 ( 2 ) 8

Total $ 60 $ ( 10 ) $ 50 $ — $ 92 $ ( 7 ) $ 85

1 unchanged sentence

Changes in the ACL are recorded through the provision for (recapture of) credit losses on the consolidated income statement.

Accrued interest receivable on held to maturity investment securities totaled $ 810,000 at December 31, 2024 and is included in accrued interest receivable on the consolidated balance sheet.

Accrued interest receivable on held to maturity investment securities totaled $ 635,000 at March 31, 2025 and is included in accrued interest receivable on the consolidated balance sheet.

This amount is excluded from the estimate of expected credit losses.

1 unchanged sentence

When held to maturity investment securities are placed on non-accrual status, unpaid interest credited to income is reversed.

The Company had $ 45,000 of private label mortgage-backed held to maturity investment securities in non-accrual status at December 31, 2024.

The Company had $ 41,000 of private label mortgage-backed held to maturity investment securities in non-accrual status at March 31, 2025.

The Company monitors the credit quality of investment securities held to maturity using credit ratings from Moody's, S&P and Fitch.

The Company monitors the credit ratings on a quarterly basis.

The following table sets forth the Company's held to maturity investment securities at December 31, 2024 by credit quality indicator:

The following tables set forth the Company's held to maturity investment securities at March 31, 2025 and September 30, 2024 by credit quality indicator:

Credit Ratings

As of December 31, 2024 AAA/AA/A BBB/BB/B Unrated Total

As of March 31, 2025 AAA/AA/A BBB/BB/B Unrated Total

Held to Maturity

21 unchanged sentences

The amounts written off due to credit loss remain and continue to be recovered on a cash basis.

The following table presents a roll forward of the credit loss component of held to maturity investment securities that have been written down for OTTI with the credit loss component recognized in earnings for the three months ended December 31, 2024 and 2023 (dollars in thousands):

Three Months Ended

The following table presents a roll forward of the credit loss component of held to maturity investment securities that have been written down for OTTI with the credit loss component recognized in earnings for the six months ended March 31, 2025 and 2024 (dollars in thousands):

Six Months Ended

Beginning balance of credit loss $ 803 $ 816

15 unchanged sentences

Based on this assessment, the Company determined that it is not "more likely than not" that the Company's fair value is less than its carrying amount, and, therefore, goodwill was determined not to be impaired at May 31, 2024.

As of December 31, 2024, management believes that there have been no events or changes in the circumstances since May 31, 2024 that would indicate a potential impairment of goodwill.

As of March 31, 2025, management believes that there have been no events or changes in the circumstances since May 31, 2024 that would indicate a potential impairment of goodwill.

No assurances can be given, however, that the Company will not record an impairment loss on goodwill in the future.

4 unchanged sentences

CDI is evaluated for impairment whenever events or changes in circumstances indicate that its carrying amount may not be recoverable, with any changes in estimated useful life accounted for prospectively over the revised remaining life.

As of December 31, 2024, management believes that there have been no events or changes in the circumstances that would indicate a potential impairment of CDI.

As of March 31, 2025, management believes that there have been no events or changes in the circumstances that would indicate a potential impairment of CDI.

(4) LOANS RECEIVABLE AND ALLOWANCE FOR CREDIT LOSSES

Loans receivable by portfolio segment consisted of the following at December 31, 2024 and September 30, 2024 (dollars in thousands):

Loans receivable by portfolio segment consisted of the following at March 31, 2025 and September 30, 2024 (dollars in thousands):

2025 September 30,

25 unchanged sentences

Loans receivable, net $ 1,420,074 $ 1,421,523

Loans receivable at December 31, 2024 and September 30, 2024 are reported net of unamortized discounts totaling $ 147,000 and $ 155,000 , respectively.

__________________

(1) Does not include one- to four-family loans held for sale totaling $ 1.2 million and $ 0 at March 31, 2025 and September 30, 2024, respectively.

Loans receivable at March 31, 2025 and September 30, 2024 are reported net of unamortized discounts totaling $ 131,000 and $ 155,000 , respectively.

Credit Quality Indicators

14 unchanged sentences

Loans in this classification have the weaknesses of substandard loans with the additional characteristic that the weaknesses make the collection or liquidation in full on the basis of currently existing facts, conditions and values questionable, and there is a high possibility of loss.

At December 31, 2024 and September 30, 2024, there was one loan classified as doubtful which is supported by an SBA guarantee of the remaining balance.

At March 31, 2025 and September 30, 2024, there was one loan classified as doubtful which is supported by an SBA guarantee of the remaining balance.

Loans in this classification are considered uncollectible and of such little value that continuance as an asset is not warranted.

This classification does not mean that the loan has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this loan even though partial recovery may be realized in the future.

At December 31, 2024 and September 30, 2024, there were no loans classified as loss.

The following table sets forth the Company's loan portfolio at December 31, 2024 by risk attribute and year of origination as well as current period gross charge-offs (dollars in thousands):

At March 31, 2025 and September 30, 2024, there were no loans classified as loss.

The following table sets forth the Company's loan portfolio at March 31, 2025 by risk attribute and year of origination as well as current period gross charge-offs (dollars in thousands):

Term Loans Amortized Cost Basis by Origination Fiscal Year

3 unchanged sentences

Watch — — 1,781 — — — — 1,781

Special Mention — — — 4,884 — — — 4,884

Substandard — — — — — 47 — 47

1 unchanged sentence

Pass $ 3,253 $ 13,132 $ 21,521 $ 39,369 $ 23,076 $ 67,320 $ 1,169 $ 168,840

Substandard — — — — 9,750 — — 9,750

Total multi-family $ 3,253 $ 13,132 $ 21,521 $ 39,369 $ 32,826 $ 67,320 $ 1,169 $ 178,590

13 unchanged sentences

Pass $ 2,533 $ 1,850 $ 317 $ — $ — $ — $ — $ 4,700

Watch — — 467 — — — — 467

Total construction-speculative one-to four-family $ 2,533 $ 1,850 $ 784 $ — $ — $ — $ — $ 5,167

7 unchanged sentences

Pass $ — $ 522 $ 1,469 $ — $ — $ — $ — $ 1,991

Watch — — — 11,549 — — — 11,549

Substandard — — — 11,549 — — — 11,549

Total construction-land development $ — $ 522 $ 1,469 $ 11,549 $ — $ — $ — $ 13,540

12 unchanged sentences

Watch — — — — — 9 — 9

Substandard — — — — — — 23 $ 23

Total other consumer $ 942 $ 300 $ 414 $ 90 $ 48 $ 482 $ 99 $ 2,375

3 unchanged sentences

Watch — — — — 22 — — 22

Special Mention — — — 211 327 226 — 764

Substandard — — 159 153 — 617 254 1,183

106 unchanged sentences

In addition, regulatory agencies, as integral part of their examination process, periodically review the Company's ACL and may require the Company to make adjustments to the ACL based on their judgment about information available to them at the time of their examinations.

The following tables set forth information for the three months ended December 31, 2024 and 2023 regarding activity in the ACL by portfolio segment (dollars in thousands):

Three Months Ended December 31, 2024

The following tables set forth information for the three and six months ended March 31, 2025 and 2024 regarding activity in the ACL by portfolio segment (dollars in thousands):

Three Months Ended March 31, 2025

Allowance Provision for

16 unchanged sentences

Total $ 17,288 $ 237 $ ( 2 ) $ 2 $ 17,525

Three Months Ended December 31, 2023

Six Months Ended March 31, 2025

Allowance Provision for

(Recapture of) Credit Losses Charge-

offs Recoveries Ending

Mortgage loans:

One-to four-family $ 2,632 $ 168 $ — $ — $ 2,800

Multi-family 1,308 7 — — 1,315

Commercial real estate 6,934 49 — — 6,983

Construction – custom and owner/builder 1,328 ( 111 ) — — 1,217

Construction – speculative one- to four-family 128 ( 39 ) — — 89

Construction – commercial 537 ( 179 ) — — 358

Construction – multi-family 456 87 — — 543

Construction – land development 335 40 — — 375

Land 793 59 — — 852

Consumer loans:

Home equity and second mortgage 348 ( 3 ) — — 345

Other 39 ( 2 ) ( 4 ) — 33

Commercial business loans 2,640 213 ( 241 ) 3 2,615

Total $ 17,478 $ 289 $ ( 245 ) $ 3 $ 17,525

Three Months Ended March 31, 2024

Allowance Provision for

(Recapture of) Loan Losses Charge-

offs Recoveries Ending

Mortgage loans:

One- to four-family $ 2,096 $ 89 $ — $ — $ 2,185

Multi-family 1,200 158 — — 1,358

Commercial real estate 6,822 132 — — 6,954

Construction – custom and owner/builder 1,234 ( 19 ) — — 1,215

Construction – speculative one- to four-family 132 10 — — 142

Construction – commercial 430 21 — — 451

Construction – multi-family 735 ( 257 ) — — 478

Construction – land development 298 ( 43 ) — — 255

Land 757 83 — — 840

Consumer loans:

Home equity and second mortgage 286 19 — — 305

Other 46 3 ( 4 ) — 45

Commercial business loans 2,619 ( 30 ) — 1 2,590

Total $ 16,655 $ 166 $ ( 4 ) $ 1 $ 16,818

Six Months Ended March 31, 2024

Allowance Impact of Adopting CECL (ASU 2016-13) Provision for

22 unchanged sentences

A loan is generally not removed from non-accrual until all delinquent principal, interest and late fees have been brought current and the borrower demonstrates repayment ability over a period of not less than six months and all taxes are current.

The following tables present an analysis of loans by aging category and portfolio segment at December 31, 2024 and September 30, 2024 (dollars in thousands):

The following tables present an analysis of loans by aging category and portfolio segment at March 31, 2025 and September 30, 2024 (dollars in thousands):

Past Due 60-89

3 unchanged sentences

Past Due Current Total

December 31, 2024

March 31, 2025

Mortgage loans:

3 unchanged sentences

Construction – custom and owner/builder (2)

— — — — — 73,900 73,900

Construction – speculative one- to four-family (2)

— — — — — 5,167 5,167

Construction – commercial (2)

— — — — — 15,762 15,762

Construction – multi-family (2)

— — — — — 24,767 24,767

Construction – land development (2)

— — — — — 13,540 13,540

Land — — — — — 32,301 32,301

6 unchanged sentences

(1) Includes non-accrual loans past due 90 days or more and other loans classified as non-accrual.

(2) Net of construction LIP.

Past Due 60-89

9 unchanged sentences

Construction – custom and owner/builder (2)

— — — — — 81,274 81,274

Construction – speculative one- to four-family (2)

— — — — — 7,451 7,451

Construction – commercial (2)

— — — — — 23,812 23,812

Construction – multi-family (2)

— — — — — 20,757 20,757

Construction – land development (2)

— — — — — 16,029 16,029

Land — — — — — 29,366 29,366

6 unchanged sentences

(1) Includes non-accrual loans past due 90 days or more and other loans classified as non-accrual.

At December 31, 2024, the Company had $ 1.40 million of non-accrual loans with an ACL of $ 431,000 and $ 1.33 million of non-accrual loans with no ACL.

The following table is a summary of the amortized cost of collateral dependent non-accrual loans as of December 31, 2024 (in thousands):

(2) Net of construction LIP.

At March 31, 2025, the Company had $ 1.38 million of non-accrual loans with an ACL of $ 423,000 and $ 946,000 of non-accrual loans with no ACL.

The following table is a summary of the amortized cost of collateral dependent non-accrual loans as of March 31, 2025 (in thousands):

Recorded Investment Related ACL

6 unchanged sentences

Total $ 2,327 $ 423

At September 30, 2024, the Company had $ 1.83 million of non-accrua1 loans with an ACL of $ 506,000 and $ 2.06 million of non-accrual loans with no ACL.

At September 30, 2024, the Company had $ 2.06 million of non-accrual loans with an ACL of $ 506,000 and $ 1.83 million of non-accrual loans with no ACL.

The following table is a summary of the amortized cost of collateral dependent non-accrual loans as of September 30, 2024 (in thousands):

7 unchanged sentences

Total $ 3,885 $ 506

Troubled Loan Modifications

Loan Modifications to Borrowers Experiencing Financial Difficulty

Occasionally, the Company offers modifications of loans to borrowers experiencing financial difficulty by providing principal forgiveness, interest rate reductions, other-than-insignificant payment delays, term extensions or any combination of these.

4 unchanged sentences

These methods incorporate the post-modification of loan terms, as well as defaults and charge-offs associated with historical modified loans.

There were no loans modified related to borrowers experiencing financial difficulty during the three months ended December 31, 2024.

There were no loans past due at December 31, 2024 that had been modified in the previous 12 months.

At December 31, 2024, the Company has operating leases for two retail bank branch offices and an administrative office.

The following tables present the amortized cost basis of loans at March 31, 2025 that were both experiencing financial difficulty and modified during the six months ended March 31, 2025, by loan class and modification type (dollars in thousands):

Combination - Term Extension and Collateral Addition

March 31, 2025 Amortized Cost Basis % of Total Loan Type Financial Effect

Commercial Business Loan $ 256 0.20 % Loan extended three months and secured a deed of trust on a land parcel

Combination - Term Extension and Payment Modification

March 31, 2025 Amortized Cost Basis % of Total Loan Type Financial Effect

Commercial Business Loan $ 5 — % Loan extended seven months , monthly payment reduced with principal payments due at time of change in terms and 1.5 months after signing

There were no modified loans to borrowers experiencing financial difficulty at March 31, 2024.

At March 31, 2025, the Company has operating leases for two retail bank branch offices and an administrative office.

The Company's leases have remaining lease terms of two to seven years , and include options to extend the leases for up to five years .

Lease extensions are not certain, and the Company evaluates each lease based on the specific circumstances for the location to determine the probability of exercising the extensions in the calculation of ROU assets and lease liabilities.

The components of lease cost (included in the premises and equipment expense category in the consolidated statements of income) are as follows for the three months ended December 31, 2024 and 2023 (dollars in thousands):

Three Months Ended December 31,

The components of lease cost (included in the premises and equipment expense category in the consolidated statements of income) are as follows for the three and six months ended March 31, 2025 and 2024 (dollars in thousands):

Three Months Ended March 31, Six Months Ended March 31,

2025 2024 2025 2024

Operating lease cost $ 100 $ 92 $ 197 $ 185

1 unchanged sentence

Total lease cost $ 100 $ 92 $ 197 $ 185

The following table provides supplemental information related to operating leases at or for the three months ended December 31, 2024 and 2023 (dollars in thousands):

At or For the Three Months Ended December 31, 2024 At or For the Three Months Ended December 31, 2023

The following table provides supplemental information related to operating leases at or for the three and six months ended March 31, 2025 and 2024 (dollars in thousands):

At or For the Three Months Ended March 31, 2025 At or For the Six Months Ended March 31, 2025

Cash paid for amounts included in the measurement of lease liabilities:

2 unchanged sentences

Weighted average discount rate-operating leases 2.35 % 2.35 %

At or For the Three Months Ended March 31, 2024 At or For the Six Months Ended March 31, 2024

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases $ 83 $ 166

Weighted average remaining lease term-operating leases 6.3 years 6.3 years

Weighted average discount rate-operating leases 2.34 % 2.34 %

The Company's leases typically do not contain a discount rate implicit in the lease contracts.

As an alternative, the weighted average discount rate used to estimate the present value of future lease payments in calculating the value of the ROU asset and lease liability was determined by utilizing the FHLB fixed-rate credit advance borrowing rate for the term correlating to the remaining term of each lease.

Maturities of operating lease liabilities at December 31, 2024 for future fiscal years are as follows (dollars in thousands):

Remainder of 2025 $ 253

Maturities of operating lease liabilities at March 31, 2025 for future fiscal years are as follows (dollars in thousands):

Remainder of Fiscal 2025 $ 169

Fiscal 2026 304

Fiscal 2027 232

Fiscal 2028 219

Fiscal 2029 218

Thereafter 383

7 unchanged sentences

Common stock equivalents arise from the assumed conversion of outstanding stock options.

Information regarding the calculation of basic and diluted net income per common share for the three months ended December 31, 2024 and 2023 is as follows (dollars in thousands, except per share amounts):

Three Months Ended December 31,

Information regarding the calculation of basic and diluted net income per common share for the three and six months ended March 31, 2025 and 2024 is as follows (dollars in thousands, except per share amounts):

Three Months Ended March 31, Six Months Ended March 31,

2025 2024 2025 2024

Basic net income per common share computation

9 unchanged sentences

____________________________________________

(1) For the three months ended December 31, 2024 and 2023, average options to purchase 96,220 and 214,595 shares of common stock, respectively, were outstanding but not included in the computation of diluted net income per common share because their effect would have been anti-dilutive.

(1) For the three and six months ended March 31, 2025, average options to purchase 126,540 and 111,213 shares of common stock, respectively, were outstanding but not included in the computation of diluted net income per common share because their effect would have been anti-dilutive.

For the three and six months ended March 31, 2024, average options to purchase 244,030 and 229,232 shares of common stock, respectively, were outstanding but not included in the computation of diluted net income per common share because their effect would have been anti-dilutive.

(7) ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in accumulated other comprehensive income (loss) ("AOCI") by component during the three months ended December 31, 2024 and 2023 are as follows (dollars in thousands):

Three Months Ended December 31, 2024

The changes in accumulated other comprehensive income (loss) ("AOCI") by component during the three and six months ended March 31, 2025 and 2024 are as follows (dollars in thousands):

Three Months Ended March 31, 2025

Changes in fair value of available for sale securities (1) Total (1)

Balance of AOCI at the beginning of period $ ( 792 ) $ ( 792 )

Other comprehensive income 122 122

Balance of AOCI at the end of period $ ( 670 ) $ ( 670 )

__________________________

(1) All amounts are net of income taxes.

Six Months Ended March 31, 2025

Changes in fair value of available for sale securities (1) Total (1)

Balance of AOCI at the beginning of period $ 20 $ 20

Other comprehensive loss ( 690 ) ( 690 )

2 unchanged sentences

(1) All amounts are net of income taxes.

Three Months Ended December 31, 2023

Three Months Ended March 31, 2024

Changes in fair value of available for sale securities (1) Total (1)

Balance of AOCI at the beginning of period $ ( 827 ) $ ( 827 )

Other comprehensive income 82 82

Balance of AOCI at the end of period $ ( 745 ) $ ( 745 )

__________________________

(1) All amounts are net of income taxes.

Six Months Ended March 31, 2024

Changes in fair value of available for sale securities (1) Changes in OTTI on held to maturity securities (1) Total (1)

5 unchanged sentences

(8) STOCK COMPENSATION PLANS

The Company has two active stock compensation plans:

the 2014 Equity Incentive Plan and the 2019 Equity Incentive Plan.

Under the Company's 2014 Equity Incentive Plan, the Company may grant options and awards of restricted stock (with or without performance measures) for up to 352,366 shares of common stock to employees, officers, directors and directors emeriti.

Under the Company's 2019 Equity Incentive Plan, the Company may grant options and awards of restricted stock (with or without performance measures) for up to 350,000 shares of common stock, of which 300,000 shares are reserved to be awarded to employees and officers, and 50,000 shares are reserved to be awarded to directors and directors emeriti.

Shares issued may be purchased in the open market or may be issued from authorized and unissued shares.

The exercise price of each option equals the fair market value of the Company’s common stock on the date of grant.

Generally, options and restricted stock vest in equal annual installments commencing on the first anniversary of the grant date.

Stock options generally vest over a five year period from the date of the grant with a maximum contractual term of ten years from the date of grant.

Restricted stock grants generally vest over a three or five year term from the grant date.

At December 31, 2024, there were 15,576 and 155,705 shares of common stock available which may be awarded as options or restricted stock pursuant to future grants under the 2014 and 2019 Equity Incentive Plans, respectively.

Stock option activity for the three months ended December 31, 2024 and 2023 is summarized as follows:

Three Months Ended December 31, 2024 Three Months Ended December 31, 2023

The Company maintains one active stock compensation plan, the 2019 Equity Incentive Plan (the "2019 Plan").

Under the 2019 Plan, the Company may grant options and awards of restricted stock (with or without performance measures) for up to 350,000 shares of common stock, of which 300,000 shares are reserved for issuance to employees and officers, and 50,000 shares are reserved for issuance to directors and directors emeriti.

Shares issued under the 2019 Plan may be purchased on the open market or issued from the Company's authorized and unissued shares.

The exercise price of each stock option equals the fair market value of the Company’s common stock on the date of grant.

Stock options generally vest in equal annual installments over five years beginning on the first anniversary of the grant date and have a maximum contractual term of ten years .

Restricted stock awards typically vest in equal annual installments over a three - or five-year period beginning on the first anniversary of the grant date.

At March 31, 2025, 160,185 shares of common stock remained available for further issuance under the 2019 Plan, either as stock options or restricted stock.

The Company's 2014 Equity Incentive Plan (the "2014 Plan") expired on January 27, 2025;

therefore, no further awards may be granted under the plan.

As of March 31, 2025, there were 159,780 shares outstanding that had been previously granted in the 2014 Plan, of which 137,350 were vested and 22,430 were unvested.

Stock option activity for the six months ended March 31, 2025 and 2024 is summarized as follows:

Six Months Ended March 31, 2025 Six Months Ended March 31, 2024

Number of Shares Weighted

5 unchanged sentences

The fair value of stock options is determined using the Black-Scholes valuation model.

There were no stock options granted during the three months ended December 31, 2024 and 2023.

The aggregate intrinsic value of options exercised during the three months ended December 31, 2024 and 2023 was $ 239,000 and $ 469,000 , respectively.

At December 31, 2024, there were 76,530 unvested options with an aggregate grant date fair value of $ 464,000 , all of which the Company assumes will vest.

The aggregate intrinsic value of unvested options at December 31, 2024 was $ 328,000 .

There were 100 options that vested during the three months ended December 31, 2024 with a total fair value of $ 326 .

At December 31, 2023, there were 124,640 unvested options with an aggregate grant date fair value of $ 725,000 .

There were 100 options that vested during the three months ended December 31, 2023 with a total fair value of $ 326 .

Additional information regarding options outstanding at December 31, 2024 is as follows:

There were no stock options granted during the six months ended March 31, 2025 and 2024.

The aggregate intrinsic value of options exercised during the six months ended March 31, 2025 and 2024 was $ 386,000 and $ 499,000 , respectively.

At March 31, 2025, there were 71,230 unvested options with an aggregate grant date fair value of $ 431,000 , all of which the Company assumes will vest.

The aggregate intrinsic value of unvested options at March 31, 2025 was $ 282,000 .

There were 2,500 options that vested during the six months ended March 31, 2025 with a total fair value of $ 16,000 .

At March 31, 2024, there were 121,820 unvested options with an aggregate grant date fair value of $ 709,000 .

There were 300 options that vested during the six months ended March 31, 2024 with a total fair value of $ 2,000 .

Additional information regarding options outstanding at March 31, 2025 is as follows:

Options Outstanding Options Exercisable

9 unchanged sentences

265,980 $ 25.82 5.1 194,750 $ 25.68 4.4

The aggregate intrinsic value of options outstanding at December 31, 2024 and 2023 was $ 1.45 million and $ 2.22 million , respectively.

As of December 31, 2024, unrecognized compensation cost related to unvested stock options was $ 437,000 , which is expected to be recognized over a weighted average period of 1.60 years.

There were no restricted stock awards granted during the three months ended December 31, 2024 and 2023.

Three Months Ended December 31, 2024 Three Months Ended December 31, 2023

The aggregate intrinsic value of options outstanding at March 31, 2025 and 2024 was $ 1.20 million and $ 1.06 million , respectively.

As of March 31, 2025, unrecognized compensation cost related to unvested stock options was $ 363,000 , which is expected to be recognized over a weighted average period of 1.46 years.

There were no restricted stock awards granted during the six months ended March 31, 2025 and 2024.

Six Months Ended March 31, 2025 Six Months Ended March 31, 2024

Number of Unvested Shares Weighted Average Grant Date Fair Value Number of Unvested Shares Weighted Average Grant Date Fair Value

1 unchanged sentence

Forfeited ( 1,830 ) 28.70 — —

Vested ( 200 ) 27.37 — —

Restricted stock outstanding end of period 46,985 $ 29.31 26,150 $ 27.37

1 unchanged sentence

The related stock-based compensation expense is recorded over the requisite service period.

At December 31, 2024, unrecognized compensation cost related to unvested restricted stock awards was $ 1.34 million, which is expected to be recognized over a weighted average period of 2.45 years.

At March 31, 2025, unrecognized compensation cost related to unvested restricted stock awards was $ 1.21 million, which is expected to be recognized over a weighted average period of 2.32 years.

(9) FAIR VALUE MEASUREMENTS

5 unchanged sentences

Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Significant observable inputs other than quoted prices included within Level 1, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs other than quoted prices that are observable or can be corroborated by observable market data.

liabilities in markets that are not active, and inputs other than quoted prices that are observable or can be corroborated by observable market data.

Significant unobservable inputs that reflect a company’s own assumptions about the assumptions that market participants would use in pricing an asset or liability based on the best information available in the circumstances.

4 unchanged sentences

government agency securities are based upon quoted market prices (Level 1).

The Company had no liabilities measured at fair value on a recurring basis at December 31, 2024 and September 30, 2024.

The Company's assets measured at estimated fair value on a recurring basis at December 31, 2024 and September 30, 2024 were as follows (dollars in thousands):

December 31, 2024 Estimated Fair Value

The Company had no liabilities measured at fair value on a recurring basis at March 31, 2025 and September 30, 2024.

The Company's assets measured at estimated fair value on a recurring basis at March 31, 2025 and September 30, 2024 were as follows (dollars in thousands):

March 31, 2025 Estimated Fair Value

Level 1 Level 2 Level 3 Total

15 unchanged sentences

Total $ 4,805 $ 68,318 $ — $ 73,123

There were no transfers among Level 1, Level 2 and Level 3 during the three months ended December 31, 2024 and the year ended September 30, 2024.

There were no transfers among Level 1, Level 2 and Level 3 during the six months ended March 31, 2025 and the year ended September 30, 2024.

The Company may be required, from time to time, to measure certain assets and liabilities at fair value on a non-recurring basis in accordance with GAAP.

9 unchanged sentences

The valuation of OREO and other repossessed assets is subject to significant external and internal judgment (Level 3).

The following table summarizes the balances of assets measured at estimated fair value on a non-recurring basis at December 31, 2024 and September 30, 2024 (dollars in thousands):

The following table summarizes the balances of assets measured at estimated fair value on a non-recurring basis at March 31, 2025 and September 30, 2024 (dollars in thousands):

Estimated Fair Value Total Estimated

December 31, 2024 Level 1 Level 2 Level 3 Fair Value

March 31, 2025 Level 1 Level 2 Level 3 Fair Value

Individually evaluated collateral-dependent loans:

8 unchanged sentences

Total $ — $ — $ 1,315 $ 1,315

The following table presents quantitative information about Level 3 inputs for financial instruments measured at fair value on a non-recurring basis as of December 31, 2024 and September 30, 2024 (dollars in thousands):

The following table presents quantitative information about Level 3 inputs for financial instruments measured at fair value on a non-recurring basis as of March 31, 2025 and September 30, 2024:

Technique(s) Unobservable Input(s) Range

Individually evaluated collateral-dependent loans Market approach Appraised value less estimated selling costs N/A

OREO and other repossessed assets Market approach Lower of appraised value or listing price less estimated selling costs N/A

Individually evaluated collateral-dependent loans Market approach Appraised value less estimated selling costs 8 %

OREO and other repossessed assets Market approach Lower of appraised value or listing price less estimated selling costs 8 %

GAAP requires disclosure of estimated fair values for certain financial instruments.

3 unchanged sentences

The disclosures also do not include estimated fair value amounts for certain items which are not defined as financial instruments but which may have significant value.

The Company does not believe that it would be practicable to estimate a fair value for these types of items as of December 31, 2024 and September 30, 2024.

The Company does not believe that it would be practicable to estimate a fair value for these types of items as of March 31, 2025 and September 30, 2024.

Because GAAP excludes certain items from fair value disclosure requirements, any aggregation of the fair value amounts presented would not represent the underlying value of the Company.

Additionally, the Company uses the exit price notion in calculating the fair values of financial instruments not measured at fair value on a recurring basis.

The recorded amounts and estimated fair values of financial instruments were as follows as of December 31, 2024 and September 30, 2024 (dollars in thousands):

December 31, 2024

The recorded amounts and estimated fair values of financial instruments were as follows as of March 31, 2025 and September 30, 2024 (dollars in thousands):

March 31, 2025

Fair Value Measurements Using:

51 unchanged sentences

Revenue reported as service charges on deposits, ATM and debit card interchange transaction fees, merchant services fees, non-deposit investment fees and escrow fees are within the scope of ASC 606.

All of the Company's revenue from contracts with customers within the scope of ASC 606 is recognized in non-interest income with the exception of gains on sales of OREO and gains on sales/disposition of premises and equipment, which are included in non-interest expense.

For the three months ended December 31, 2024, the Company recognized $ 999,000 in service charges on deposits, $ 1.27 million in ATM and debit card interchange transaction fees, $ 18,000 in escrow fees, and $ 1,000 in fee income from non-deposit investment sales included in "Other" on the consolidated statement of income, all considered within the scope of ASC 606.

For the three months ended December 31, 2023, the Company recognized $ 1.02 million in service charges on deposits, $ 1.26 million in ATM and debit card interchange transaction fees, $ 19,000 in escrow fees, and $ 2,000 in fee income from non-deposit investment sales.

All of the Company's revenue from contracts with customers within the scope of ASC 606 is recognized in non-interest income with the exce ption of gains on sales of OREO and gains on sales/disposition of premises and equipment, which are included in non-interest expense.

For the three months ended March 31, 2025, the Company recognized $ 959,000 in service charges on deposits, $ 1.18 million in ATM and debit card interchange transaction fees, $ 17,000 in escrow fees, and $ 1,000 in fee income from non-deposit investment sales included in "Other" on the consolidated statement of income, all considered within the scope of ASC 606.

For the six months ended March 31, 2025, the Company recognized $ 1.96 million in service charges on deposits, $ 2.44 million in ATM and debit card interchange transaction fees, $ 35,000 in escrow fees, and $ 2,000 in fee income from non-deposit investment sales.

For the three months ended March 31, 2024, the Company recognized $ 988,000 in service charges on deposits, $ 1.21 million in ATM and debit card interchange transaction fees, $ 15,000 in escrow fees, and $ 2,000 in fee income from non-deposit investment sales.

For the six months ended March 31, 2024, the Company recognized $ 2.01 million in service charges on deposits, $ 2.48 million in ATM and debit card interchange transaction fees, $ 33,000 in escrow fees, and $ 3,000 in fee income from non-deposit investment sales.

If a contract is determined to be within the scope of ASC 606, the Company recognizes revenue when it satisfies its performance obligation.

3 unchanged sentences

Non-transaction based fees such as account maintenance fees and monthly statement fees are considered to be provided to the customer under a day-to-day contract with ongoing renewals.

Revenue for these non-transaction fees are earned over the course of a month, representing the period over which the Company satisfies the performance obligation.

Revenue for these non-transaction fees are earned over the course of a month, representing the period over which the Company satisfies the performance

Transaction-based fees such as non-sufficient fund charges, stop payment charges and wire fees are recognized at the time the transaction is executed, as the contract duration does not extend beyond the service performed.

• ATM and Debit Card Interchange Transaction Fees:

The Company earns fees from cardholder transactions conducted through third-party payment network providers which consist of interchange fees earned from the payment networks

as a debit card issuer.

The Company earns fees from cardholder transactions conducted through third-party payment network providers which consist of interchange fees earned from the payment networks as a debit card issuer.

These fees are recognized when the transaction occurs, but may settle on a daily or monthly basis.

18 unchanged sentences

Collateral held varies, but may include accounts receivable, inventory, property and equipment, residential real estate, land and income-producing commercial properties.

A summary of the Company's commitments at December 31, 2024 and 2023 are listed below (in thousands):

December 31, 2024 December 31, 2023

A summary of the Company's commitments at March 31, 2025 and 2024 are listed below (in thousands):

March 31, 2025 March 31, 2024

Undisbursed portion of construction loans in process (see Note 4) $ 75,042 $ 77,502

7 unchanged sentences

The ACL on unfunded commitments is recognized in other liabilities and accrued expenses in the consolidated balance sheets and is adjusted as a provision for (recapture of) credit losses on the consolidated income statements.

The ACL on unfunded loan commitments totaled $ 307,000 at December 31, 2024.

The following table sets forth information for the three months ended December 31, 2024 and 2023 regarding activity in the ACL on unfunded loan commitments (dollars in thousands):

Three Months Ended December 31, 2024 Three Months Ended December 31, 2023

The ACL on unfunded loan commitments totaled $ 320,000 and $ 276,000 at March 31, 2025 and 2024, respectively

The following table sets forth information for the three and six months ended March 31, 2025 and 2024 regarding activity in the ACL on unfunded loan commitments (dollars in thousands):

Three Months Ended March 31, 2025 Three Months Ended March 31, 2024

Beginning ACL $ 307 $ 364

Provision for (recapture of) credit losses 13 * ( 88 )

Ending ACL $ 320 $ 276

*Amount differs from Income Statement due to rounding.

ACL Six Months Ended March 31, 2025 Six Months Ended March 31, 2024

Beginning ACL $ 327 $ 332

Impact of adopting CECL (ASU 2016-13) — 65

5 unchanged sentences

The maximum payment for any eligible employee would be equal to 18 months of the employee’s current compensation.

Timberland Bancorp has employment agreements with the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Chief Lending Officer, Chief Credit Officer and Chief Technology Officer which provide for a severance payment and other benefits if the officers are involuntarily terminated following a change in control of Timberland Bancorp or the Bank.

The maximum value of the severance benefits under the employment agreements is 2.99 times the officer's average annual compensation during the five-year period prior to the effective date of the change in control.

Timberland Bancorp has entered into employment agreements with its Chief Executive Officer, Chief Operating Officer, Chief Financial Officer, Chief Lending Officer, Chief Credit Officer and Chief Technology Officer.

These agreements provide for severance payments and other benefits in the event of an involuntary termination of employment following a change in control of Timberland Bancorp or its subsidiary, Timberland Bank.

The maximum value of the severance benefits under these agreements is equal to 2.99 times the officer's average annual compensation during the five-year period preceding the effective date of the change in control.

Because of the nature of its activities, the Company is subject to various pending and threatened legal actions which arise in the ordinary course of business.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements