HATTIESBURG, Miss.--(BUSINESS WIRE)--The First Bancshares, Inc. (NASDAQ: FBMS), holding company for The First, A National Banking Association, (www.thefirstbank.com) today reported earnings for the quarter ended September 30, 2014. The First Bancshares, Inc. also announced a quarterly dividend of $.0375 per common share. The record date will be November 10, 2014 with a payable date of November 25, 2014.
Net income available to common shareholders exclusive of merger related costs for the three months ended September 30, 2014 was $1,606,000, or $0.30 per diluted share, a 23.1% increase in net income available to common shareholders over the same quarter in 2013 adjusted for merger related costs. Net income available to common stockholders for the three months ended September 30, 2014 amounted to $1,448,000, or $0.27 per diluted share, compared to $998,000, or $0.19 per diluted share for the same quarter in 2013, an increase of $450,000 or 45.1% in net income available to common shareholders.
Net income available to common shareholders exclusive of one-time items for the nine months ended September 30, 2014 was $4,425,000, or $0.85 per diluted share, a 27.7% increase in net income available to common shareholders over the same period in 2013 adjusted for merger related costs. Net income available to common stockholders for the nine months ended September 30, 2014 amounted to $4,296,000, or $0.82 per diluted share, compared to $2,823,000, or $0.69 per diluted share for the same period in 2013, an increase of $1,473,000 or 52.2% in net income available to common shareholders.
M. Ray “Hoppy” Cole, President & Chief Executive Officer, commented, “We closed the acquisition of Bay Bank on July 1, 2014 and completed the system integration in August, 2014. We welcome our new clients, team members and shareholders from Bay Bank and look forward to our improved market coverage in the Mobile area with 10 locations in Mobile and Baldwin Counties, Ala. The combination of these two community-oriented institutions will provide our clients more convenient locations and expanded products and services to help reach their financial goals.”
Balance Sheet Highlights
Total assets for the Company totaled $1.1 billion at September 30, 2014, an increase of $63.0 million compared with June 30, 2014. The increase during the third quarter of 2014 was attributable to an increase in the Company’s deposit balances along with the acquisition of BCB Holdings, holding company of Bay Bank.
September 30, 2014 loans outstanding increased by $61.3 million, or approximately 40.2% on an annualized basis, compared with June 30, 2014, and increased $98.8 million, or 17.3%, compared to September 30, 2013 total loans outstanding. Loans acquired on July 1, 2014 from Bay Bank amounted to $40.9 million.
| End of Period Loan Balances | 09/30/14 | 06/30/14 | 09/30/13 | |||||||||
| (dollars in thousands) | ||||||||||||
| Loans held for sale | $ | 3,769 | $ | 3,220 | $ | 1,399 | ||||||
| Commercial | 100,263 | 81,958 | 79,094 | |||||||||
| Real Estate: | ||||||||||||
| Mortgage-commercial | 217,684 | 204,101 | 198,123 | |||||||||
| Mortgage-residential | 248,125 | 230,310 | 211,494 | |||||||||
| Construction | 83,908 | 74,105 | 66,745 | |||||||||
| Consumer and other | 17,553 | 16,337 | 15,658 | |||||||||
| $ | 671,302 | $ | 610,031 | $ | 572,513 | |||||||
Non-performing assets totaled $11.4 million at September 30, 2014 compared to $13.3 million of non-performing assets at June 30, 2014 and $10.4 million at September 30, 2013. Non-performing assets represented 1.06% of total assets at September 30, 2014 compared to 1.32% of total assets at June 30, 2014, and compared to 1.09% at September 30, 2013. Non-performing loans totaled $6.1 million at September 30, 2014 compared to $6.5 million at June 30, 2014 and compared to $3.2 million of non-performing loans at September 30, 2013. Non-performing loans represented 0.91% of total loans at September 30, 2014 compared with 1.07% of total outstanding loans at June 30, 2014 and 0.55% of total loans outstanding at September 30, 2013.
| Non-Performing Assets | 09/30/14 | 06/30/14 | 09/30/13 | |||||||||
| (dollars in thousands) | ||||||||||||
| Non-Accrual Loans | $ | 6,032 | $ | 6,063 | $ | 2,681 | ||||||
| Past Due Loans (90 days or more) | 102 | 447 | 471 | |||||||||
| Total Non-Performing Loans | 6,134 | 6,510 | 3,152 | |||||||||
| Non-Accrual Securities | 250 | 1,950 | 1,950 | |||||||||
| Other Real Estate | 4,986 | 4,875 | 5,292 | |||||||||
| Total Non-Performing Assets | $ | 11,370 | $ | 13,335 | $ | 10,394 | ||||||
The Company’s allowance for loan losses totaled $6.1 million at September 30, 2014 representing an increase of $85,000, or 5.67% on an annualized basis, from June 30, 2014 and an increase of $412,000, or 7.26%, from September 30, 2013. The allowance for loan losses represented 0.91% of period-end loans at September 30, 2014 compared with 0.98% of period-end loans at June 30, 2014 and 0.99% of period-end loans at September 30, 2013. Under acquisition accounting treatment, loans acquired are recorded at fair value which includes a credit risk component, and therefore the allowance on loans acquired is not carried over from the seller. The allowance for loan losses represented 1.10% of period-end loans excluding those booked at fair value at September 30, 2014 compared with 1.16% at June 30, 2014 and 1.26% at September 30, 2013.
Total deposits increased $23.6 million or 10.7% on an annualized basis, as of September 30, 2014 compared with June 30, 2014 and increased by approximately $93.6 million or 11.5% compared with September 30, 2013. Deposits acquired from Bay Bank on July 1, 2014 were $58.1 million and totaled $54.2 million at the end of the period. A reduction in legacy deposits associated with seasonal fluctuations accounted for the difference in the net change in total deposits.
| End of Period Deposit Balances | 09/30/14 | 06/30/14 | 09/30/13 | |||||||||
| (dollars in thousands) | ||||||||||||
| Non-interest-bearing Demand Deposits | $ | 195,957 | $ | 183,226 | $ | 169,001 | ||||||
| IB Demand, Savings, and MMDA Accounts | 500,637 | 498,527 | 434,449 | |||||||||
| Time Deposits < $100,000 | 86,897 | 80,144 | 88,907 | |||||||||
| Time Deposits > $100,000 | 124,024 | 121,975 | 121,608 | |||||||||
| $ | 907,515 | $ | 883,872 | $ | 813,965 | |||||||
Results of Operations Highlights – Quarter ended September 30, 2014
Net income available to common shareholders exclusive of merger related costs for the three months ended September 30, 2014 was $1,606,000, or $0.30 per diluted share, a 11.68% increase in net income available to common shareholders compared to net income available to common shareholders exclusive of one-time items for the three months ended June 30, 2014 of $1,438,000, or $0.27 per diluted share. Net income available to common stockholders for the quarter ended September 30, 2014 totaled $1,448,000 or $0.27 per diluted share, a decrease of $79,000 or 5.17% from the second quarter of 2014 net income available to common stockholders of $1,527,000 or $0.29 per diluted share.
During the quarter ended September 30, 2014, net interest income totaled $8,855,000 representing an increase of $1,007,000, or 12.8%, compared with the quarter ended June 30, 2014 net interest income of $7,848,000 as well as an increase of $897,000, or 11.3%, compared with the quarter ended September 30, 2013 net interest income of $7,958,000. The tax equivalent net interest margin for the quarter ended September 30, 2014 was 3.79% compared to 3.52% for the quarter ended June 30, 2014 as compared to 3.86% for the quarter ended September 30, 2013. Changes in net interest income and net interest margin were due to increased average loans outstanding and seasonal fluctuations in interest-bearing deposit balances.
Fair value accounting adjustments on acquired assets and liabilities contributed approximately 7 basis points on an annualized basis to the net interest margin in the third quarter of 2014 and 12 basis points in the third quarter of 2013.
During the quarter ended September 30, 2014, non-interest income totaled $2,021,000, a decrease of $34,000 or 1.7%, compared with the quarter ended June 30, 2014, and an increase of $429,000, or 26.9%, compared with the third quarter of 2013. The decrease for the quarter ended September 30, 2014 is attributed primarily to a one-time gain of $254,000 from the sale of other investments that was recognized in the second quarter of 2014.
| Quarter Ended | Quarter Ended | Quarter Ended | ||||||||||
| Non-interest Income | 09/30/14 | 06/30/14 | 09/30/13 | |||||||||
| (dollars in thousands) | ||||||||||||
| Service Charges on Deposit Accounts | $ | 616 | $ | 594 | $ | 649 | ||||||
| Mortgage Income | 522 | 407 | 454 | |||||||||
| Interchange Fee Income | 563 | 507 | 472 | |||||||||
| Other Operating Income | 320 | 547 | 17 | |||||||||
| Total Non-interest Income | $ | 2,021 | $ | 2,055 | $ | 1,592 | ||||||
During the quarter ended September 30, 2014, non-interest expense totaled $8,071,000, an increase of $687,000, or 9.3%, compared with the quarter ended June 30, 2014, and an increase of $441,000, or 5.8%, compared with the third quarter of 2013.
| Quarter Ended | Quarter Ended | Quarter Ended | |||||||
| Non-interest Expense | 09/30/14 | 06/30/14 | 09/30/13 | ||||||
| (dollars in thousands) | |||||||||
| Salaries and Employee Benefits | $ | 4,554 | $ | 4,260 | $ | 4,010 | |||
| Occupancy, Furniture and Equipment Expense | 1,209 | 1,093 | 802 | ||||||
| FDIC Premiums | 222 | 222 | 181 | ||||||
| Professional Fees | 429 | 456 | 618 | ||||||
| Advertising and Promotion | 94 | 87 | 98 | ||||||
| Intangible Amortization | 98 | 94 | 94 | ||||||
| Other Operating Expenses | 1,465 | 1,172 | 1,827 | ||||||
| Total Non-interest Expense | $ | 8,071 | $ | 7,384 | $ | 7,630 | |||
Total non-interest expenses increased $687,000 for the third quarter of 2014 as compared to the second quarter of 2014. One-time merger related expenses of approximately $280,000 were expensed during the third quarter of 2014 as well as a write-down on other real estate in the amount of $125,000.
About The First Bancshares, Inc.
The First Bancshares, Inc., headquartered in Hattiesburg, Mississippi, is the parent company of The First, A National Banking Association. Founded in 1996, The First has operations in south Mississippi, Louisiana and south Alabama. The Company’s stock is traded on NASDAQ Global Market under the symbol FBMS. Information is available on the Company’s website: www.thefirstbank.com.
Forward Looking Statement
This news release contains statements regarding the projected performance of The First Bancshares, Inc. and its subsidiary. These statements constitute forward-looking information within the meaning of the Private Securities Litigation Reform Act. Actual results may differ materially from the projections provided in this release since such projections involve significant known and unknown risks and uncertainties. Factors that might cause such differences include, but are not limited to: competitive pressures among financial institutions increasing significantly; economic conditions, either nationally or locally, in areas in which the Company conducts operations being less favorable than expected; and legislation or regulatory changes which adversely affect the ability of the combined Company to conduct business combinations or new operations. The Company disclaims any obligation to update such factors or to publicly announce the results of any revisions to any of the forward-looking statements included herein to reflect future events or developments. Further information on The First Bancshares, Inc. is available in its filings with the Securities and Exchange Commission, available at the SEC’s website, http://www.sec.gov.
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THE FIRST BANCSHARES, INC. (unaudited, dollars in thousands except per shares data)
Consolidated Balance Sheets |
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|
Sept 30,
2014 |
June 30,
2014 |
Sept 30,
2013 |
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| ASSETS | ||||||||||||
| Cash and Due from Banks | $ | 33,111 | $ | 25,677 | $ | 26,110 | ||||||
| Federal funds sold | 1,298 | 2,477 | 1,328 | |||||||||
| Interest-bearing deposits with banks | 16,038 | 27,289 | 24,326 | |||||||||
| Investment Securities | 276,654 | 276,099 | 264,883 | |||||||||
| Loans held for sale | 3,769 | 3,220 | 1,399 | |||||||||
| Loans, Net of Unearned Income | 667,533 | 606,812 | 571,114 | |||||||||
| Allowance for Loan Losses | (6,084 | ) | (5,999 | ) | (5,672 | ) | ||||||
| Net Loans | 661,449 | 600,813 | 565,442 | |||||||||
| Premises and Equipment | 35,079 | 31,339 | 32,551 | |||||||||
| Other Real Estate Owned | 4,986 | 4,875 | 5,292 | |||||||||
| Goodwill | 12,310 | 10,621 | 10,621 | |||||||||
| Other Assets | 27,568 | 26,879 | 19,943 | |||||||||
| TOTAL ASSETS | $ | 1,072,262 | $ | 1,009,289 | $ | 951,895 | ||||||
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LIABILITIES |
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| Non-interest-bearing Demand Deposits | $ | 195,957 | $ | 183,226 | $ | 169,001 | ||||||
| Interest-bearing Accounts | 500,637 | 498,527 | 434,449 | |||||||||
| Time Deposits | 210,921 | 202,119 | 210,515 | |||||||||
| Total Deposits | 907,515 | 883,872 | 813,965 | |||||||||
| Borrowings | 49,456 | 13,500 | 30,000 | |||||||||
| Subordinated Debentures | 10,310 | 10,310 | 10,310 | |||||||||
| Other Liabilities | 11,117 | 11,830 | 13,860 | |||||||||
| TOTAL LIABILITIES | 978,398 | 919,512 | 868,135 | |||||||||
| STOCKHOLDER’S EQUITY | ||||||||||||
| Preferred Stock | 17,123 | 17,123 | 17,082 | |||||||||
| Common Stock | 5,338 | 5,180 | 5,134 | |||||||||
| Surplus | 50,328 | 42,239 | 41,994 | |||||||||
| Retained Earnings | 20,425 | 24,972 | 21,305 | |||||||||
| Accumulated Other Comprehensive Income (Loss) | 1,114 | 727 | (1,291 | ) | ||||||||
| Treasury Stock | (464 | ) | (464 | ) | (464 | ) | ||||||
| TOTAL STOCKHOLDERS’ EQUITY | 93,864 | 89,777 | 83,760 | |||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,072,262 | $ | 1,009,289 | $ | 951,895 | ||||||
| END OF PERIOD SHARES OUTSTANDING | 5,338,370 | 5,180,287 | 5,107,131 | |||||||||
| TANGIBLE BOOK VALUE PER SHARE | $ | 11.58 | $ | 11.49 | $ | 10.43 | ||||||
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THE FIRST BANCSHARES, INC. (unaudited, dollars in thousands except per share data)
Consolidated Statements of Income |
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|
Three Months
Ended |
Nine Months
Ended |
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|
Sept 30,
2014 |
Sept 30,
2013 |
Sept 30,
2014 |
Sept 30,
2013 |
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| INTEREST INCOME | ||||||||||||
| Interest and Fees on Loans | $ | 8,059 | $ | 7,216 | $ | 22,154 | $ | 18,765 | ||||
| Interest and Dividends on Securities | 1,623 | 1,396 | 4,508 | 4,072 | ||||||||
| Interest on Fed Funds Sold | 6 | 36 | 47 | 70 | ||||||||
| TOTAL INTEREST INCOME | 9,688 | 8,648 | 26,709 | 22,907 | ||||||||
| INTEREST EXPENSE | ||||||||||||
| Interest on Deposits | 689 | 540 | 1,739 | 1,824 | ||||||||
| Interest on Borrowings | 144 | 150 | 443 | 448 | ||||||||
| TOTAL INTEREST EXPENSE | 833 | 690 | 2,182 | 2,272 | ||||||||
| NET INTEREST INCOME | 8,855 | 7,958 | 24,527 | 20,635 | ||||||||
| Provision for Loan Losses | 631 | 360 | 1,266 | 1,020 | ||||||||
|
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES |
8,224 | 7,598 | 23,261 | 19,615 | ||||||||
| NON-INTEREST INCOME | 2,021 | 1,592 | 5,748 | 5,412 | ||||||||
| NON-INTEREST EXPENSE | 8,071 | 7,630 | 22,682 | 20,854 | ||||||||
| Income before Income Taxes | 2,174 | 1,560 | 6,327 | 4,173 | ||||||||
| Income Taxes | 641 | 456 | 1,754 | 1,032 | ||||||||
| NET INCOME | 1,533 | 1,104 | 4,573 | 3,141 | ||||||||
| Preferred Stock Accretion & Dividends | 85 | 106 | 277 | 318 | ||||||||
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NET INCOME AVAILABLE TO
COMMON STOCKHOLDERS |
$ | 1,448 | $ | 998 | $ | 4,296 | $ | 2,823 | ||||
| BASIC EARNINGS PER SHARE | $ | 0.27 | $ | 0.20 | $ | 0.83 | $ | 0.70 | ||||
| DILUTED EARNINGS PER SHARE | $ | 0.27 | $ | 0.19 | $ | 0.82 | $ | 0.69 | ||||
| WEIGHTED AVG SHARES OUTSTANDING | 5,311,876 | 5,102,572 | 5,198,776 | 4,058,432 | ||||||||
| DILUTED WEIGHTED AVG SHS OUTSTANDING | 5,349,686 | 5,150,517 | 5,236,586 | 4,106,377 | ||||||||
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THE FIRST BANCSHARES, INC. (unaudited, dollars in thousands except per share data) |
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Three Months
Ended |
Nine Months
Ended |
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|
Sept 30,
2014 |
Sept 30,
2013 |
Sept 30,
2014 |
Sept 30,
2013 |
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| EARNINGS PERFORMANCE RATIOS | ||||||||||||||||
| Annualized Return on Average Assets | 0.58 | % | 0.47 | % | 0.60 | % | 0.48 | % | ||||||||
| Annualized Return on Average Assets(1) | 0.64 | % | 0.60 | % | 0.62 | % | 0.57 | % | ||||||||
| Annualized Return on Average Equity | 6.81 | % | 5.66 | % | 6.94 | % | 5.56 | % | ||||||||
| Annualized Return on Average Equity(1) | 7.51 | % | 7.22 | % | 7.14 | % | 6.69 | % | ||||||||
| Net Interest Margin | 3.79 | % | 3.86 | % | 3.66 | % | 3.60 | % | ||||||||
| Efficiency Ratio(2) | 72.39 | % | 77.58 | % | 72.99 | % | 77.63 | % | ||||||||
| Efficiency Ratio(1)(2) | 70.23 | % | 73.04 | % | 72.30 | % | 73.52 | % | ||||||||
|
Net Overhead Expense to Average
Earning Assets(3) |
2.51 | % | 2.82 | % | 2.45 | % | 2.59 | % | ||||||||
|
Net Overhead Expense to Average
Earning Assets(1)(3) |
2.41 | % | 2.61 | % | 2.43 | % | 2.43 | % | ||||||||
| ASSET QUALITY RATIOS | ||||||||||||||||
| Annualized Net Charge-offs to Average Loans | 0.33 | % | 0.06 | % | 0.20 | % | 0.02 | % | ||||||||
| Allowance for Loan Losses to Period End Loans | 0.91 | % | 0.99 | % | ||||||||||||
| Non-performing Assets to Period End Assets | 1.06 | % | 1.09 | % | ||||||||||||
| Non-performing Loans to Period End Loans | 0.91 | % | 0.55 | % | ||||||||||||
| Loans 30-89 Days Past Due to Period End Loans | 0.32 | % | 0.54 | % | ||||||||||||
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SELECTED BALANCE SHEET & OTHER
FINANCIAL DATA |
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| Average Assets | $ | 1,065,080 | $ | 944,683 | $ | 1,019,301 | $ | 877,223 | ||||||||
| Average Earning Assets | $ | 964,508 | $ | 855,107 | $ | 922,462 | $ | 793,903 | ||||||||
| Average Total Loans | $ | 657,925 | $ | 566,291 | $ | 621,174 | $ | 506,461 | ||||||||
| Average Demand Deposits | $ | 194,357 | $ | 119,670 | $ | 180,841 | $ | 104,536 | ||||||||
| Average Interest Bearing Liabilities | $ | 768,793 | $ | 733,336 | $ | 739,506 | $ | 684,006 | ||||||||
| Average Equity | $ | 90,039 | $ | 78,068 | $ | 87,799 | $ | 75,352 | ||||||||
| Period End Non-performing Assets | $ | 11,370 | $ | 10,394 | ||||||||||||
| Period End Non-performing Loans | $ | 6,134 | $ | 3,152 | ||||||||||||
| Period End Loans 30-89 Days Past Due | $ | 2,143 | $ | 3,077 | ||||||||||||
| Tax Equivalent Net Interest Income | $ | 9,128 | $ | 8,243 | $ | 25,328 | $ | 21,453 | ||||||||
| Net Charge-offs (Recoveries) during Period | $ | 546 | $ | 81 | $ | 910 | $ | 75 | ||||||||
| (1)Excludes merger related costs and one-time items | ||||||||||||||||
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(2)Efficiency Ratio is defined as Non-interest Expense divided by the sum of Net Interest Income, on a tax equivalent basis, and Non-Interest Income |
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(3)Net Overhead Expense is defined as Total Non-interest Expense less Total Non-interest income |
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