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SEC filingCass Information Systems, Inc. reported solid financial results for FY 2025, with total net revenue of $190.8 million and net income of $35.1 million, which includes $4.0 million from discontinued operations. Net income from continuing operations was $31.1 million. The company generated strong net interest income of $81.2 million, supported by total interest income of $97.6 million. Operating expenses totaled $152.0 million, with personnel expenses being the largest component at $110.1 million. The balance sheet shows total assets of $2.61 billion, with loans net of $1.05 billion and total deposits of $1.20 billion. Shareholders' equity stood at $243.0 million. The company completed the sale of its telecom expense management business unit for $18.0 million in 2025, which contributed to income from discontinued operations.
Cass Information Systems reported FY 2025 total net revenue of $190.8 million, representing a 5.3% increase from $181.2 million in FY 2024. Net income from continuing operations was $31.1 million, up from $18.6 million in the prior year. Including discontinued operations, total net income reached $35.1 million compared to $19.2 million in FY 2024. The company's basic earnings per share from continuing operations was $2.36, up from $1.37 in the prior year. Total diluted earnings per share was $2.61 compared to $1.39 in FY 2024. The improvement was driven by higher net interest income and a bad debt recovery of $2.0 million related to a legal settlement.
The company operates through two reportable segments: Information Services and Banking Services. Information Services generated pretax income of $21.4 million from continuing operations in FY 2025, up from $11.2 million in FY 2024. Banking Services reported pretax income of $18.9 million from continuing operations, up from $7.9 million in the prior year. Total fee revenue and other income was $109.9 million, down from $113.8 million in FY 2024. Interest income increased to $97.6 million from $88.0 million in the prior year, driven by higher interest and fees on loans ($62.3 million vs. $55.4 million).
Operating margin (income from continuing operations before tax as percentage of total net revenue) was 20.3% in FY 2025, up significantly from 12.9% in FY 2024. The improvement was driven by higher net interest income and lower operating expenses. Total operating expense decreased to $152.0 million from $157.7 million in the prior year, primarily due to a $2.0 million bad debt recovery compared to $7.8 million bad debt expense in FY 2024. Personnel expenses remained relatively stable at $110.1 million compared to $109.3 million in FY 2024.
Net cash provided by operating activities from continuing operations was $38.8 million in FY 2025. The company used $145.2 million in investing activities from continuing operations, primarily for purchases of securities available-for-sale ($435.2 million). Financing activities provided $170.0 million from continuing operations, driven by increases in noninterest-bearing demand deposits ($262.2 million). Total assets increased to $2.61 billion from $2.40 billion in FY 2024. Loans net of allowance decreased to $1.05 billion from $1.07 billion. Total deposits increased to $1.20 billion from $967.9 million. Shareholders' equity was $243.0 million with accumulated other comprehensive loss of $26.8 million.
The company faces risks from economic and market conditions, including inflationary pressures and higher interest rates that may impact profitability. Credit quality risks remain, with an allowance for credit losses of $13.6 million on loans. The company is subject to extensive banking regulations as a financial holding company. Management noted that current economic conditions are being impacted by recent inflationary conditions and higher interest rates, which may negatively affect fixed costs and expenses. The company continues to focus on its core competencies in data acquisition, data management, business intelligence, and financial exchange services.