HATTIESBURG, Miss.--(BUSINESS WIRE)--The First Bancshares, Inc. (NASDAQ: FBMS), holding company for The First, A National Banking Association, (www.thefirstbank.com) reported today a 20% increase ($1.6 million) in operating net earnings (net income available to common shareholders adjusted for merger related costs) for the fiscal year ended December 31, 2016. Operating net earnings available to common shareholders totaled $9.9 million for 2016 as compared to $8.3 million for 2015.
Operating net earnings available to common shareholders for the fourth quarter of 2016 totaled $2.4 million as compared to $2.2 million for the fourth quarter of 2015 representing a 10.8% increase.
Fully diluted earnings per share for 2016 were $1.64 as compared to $1.55 for 2015. Fully diluted earnings per share were $0.30 for the fourth quarter of 2016 as compared to $0.40 for the fourth quarter of 2015. Fully diluted earnings per share for 2016 includes the issuance of 3,563,380 in new common shares during the fourth quarter related to the capital raise described below.
Operating net earnings available to common shareholders includes a one-time preferred dividend of $133,627 paid to private placement preferred shareholders in December 2016. These preferred shares were converted to common on December 30, 2016 and no further preferred dividend payments will be due on these securities.
Significant Events:
- On October 14, 2016 the Company announced the signing of a stock purchase agreement to acquire Iberville Bank headquartered in Plaquemine LA. The acquisition of Iberville Bank added 10 branches in the Baton Rouge area with approximately $269 million in total assets.
- On October 14, 2016 the Company announced the signing of a definitive agreement and plan of merger to acquire Gulf Coast Community Bank headquartered in Pensacola Florida. Gulf Coast added 5 branches in the Pensacola market with approximately $122 million in total assets.
- On October 14, 2016 the Company raised $63.25 million in new capital through the issuance of 3,563,380 shares of convertible preferred stock at a price of $17.75 per share. The proceeds of the issuance were used to support the acquisitions, repay the CDCI/Tarp preferred stock, and provide for additional growth.
- On December 6, 2016 the Company repurchased all 17,123 shares of its Cumulative, Perpetual Preferred Stock, Series CD issued to the U.S. Treasury in connection with the Company’s participation in the Troubled Asset Relief Program’s Community Development Capital Initiative (CDCI). The CDCI Preferred Stock was repurchased at fair market value $15,925,000 which equates to a discount of 7% to par, or $1,198,000.
- The acquisitions of Iberville Bank and Gulf Coast Community Bank closed as planned with an effective date of January 1, 2017
M. Ray “Hoppy” Cole, President & Chief Executive Officer, commented, “2016 was another year of strong growth and significantly improved profitability for our Company posting a 20% year over year increase in earnings (exclusive of merger related costs) and double digit growth in loans and deposits.
“October 14 and the fourth quarter of 2016 will prove to be transformational in the history of our Company closing two acquisitions, a capital raise and repaying the CDCI preferred stock.
“These events represent continued execution on our strategic plan of building a community bank franchise in the Gulf South, focused on growth, profitability and increased shareholder value.”
Balance Sheet
Consolidated assets increased $132.2 million or 11.5% to $1.3 billion for the year ended December 31, 2016. Total loans were $867.1 million at December 31, 2016 as compared to $854.4 million at September 30, 2016 and as compared to $772.5 million at December 31, 2015 representing increases of $12.7 million, or 1.48% for the quarter and $94.5 million, or 12.2% for the year. Increased loan volume year over year was spread across all real estate categories with commercial real estate experiencing the largest growth. Fundings for commercial real estate loans increased $61.1 million or 24.1% year over year along with residential real estate growth of $17.5 million or 6.4%.
Total deposits increased $122.5 million or 13.4% for the year ended December 31, 2016 with increases in all deposit categories with the largest increase in now accounts of $57.2 million and $39.7 million in time deposits of $100,000 or more. Total deposits decreased $32.6 million or 3.0% to $1,039.2 million for the quarter ended December 31, 2016. The decrease is a result of seasonal fluctuations in public deposit accounts.
Asset Quality
Nonperforming assets totaled $9.9 million at December 31, 2016, a decrease of $1.4 million compared to $11.3 million at September 30, 2016 and a decrease of $1.0 million compared to December 31, 2015. The ALLL/total loans ratio was 0.87% at December 31, 2016 and 0.88% at September 30, 2016. Including valuation accounting adjustments on acquired loans, the total valuation plus ALLL was 1.00% of loans at December 31, 2016. The ratio of annualized net charge-offs (recoveries) to total loans was 0.03% for the quarter ended December 31, 2016 compared to (0.04%) for the quarter ended September 30, 2016. As noted in our first quarter 2015 10-Q, the Company had been notified that a recovery of $941,000 was more likely than not expected during 2015. We received the first installment during the second quarter of 2015 which totaled $481,000 and the second installment during the third quarter of 2015 which totaled $241,000. The remaining balance of $219,000 was received during the fourth quarter of 2016.
Energy Loans
At December 31, 2016 the company had direct energy related loans of $19.9 million, representing 2.3% of the total loan portfolio. A majority of the outstanding are secured by marine assets that operate in the Gulf of Mexico, which are under term contracts to major operators tied primarily to oil and gas production.
Fourth Quarter 2016 vs. Fourth Quarter 2015 Earnings Comparison
Fourth quarter 2016 net earnings available to common shareholders (including merger related costs) totaled $2.1 million compared to $2.3 million for the fourth quarter of 2015. Revenues from consolidated operations increased $2.3 million in quarterly comparison. Net interest income increased $1.1 million in quarterly comparison as interest income earned on a higher volume of loans attributed to this overall increase. Noninterest income increased $0.8 million in quarterly comparison for the fourth quarter of 2016 as compared to the fourth quarter of 2015 consisting mainly of increased mortgage income.
Fourth quarter 2016 noninterest expense increased $1.9 million, or 22.4% as compared to fourth quarter 2015. The largest increase in noninterest expense was related to salaries and benefits of $1.3 million of which $500,000 is associated with the addition of The Mortgage Connection and increased mortgage commissions. Approximately $200,000 is associated with lending teams in Mobile, AL and Jackson, MS and the startup of a Treasury Management division. Other professional services increased $0.5 million, $0.4 million of which was related to the acquisitions of Iberville Bank and Gulf Coast Community Bank. The remaining $0.1 million was accrued for legal fees associated with the pending proxy litigation.
Fully taxable-equivalent (“FTE”) net interest income totaled $10.9 million and $9.8 million for the fourth quarter of 2016 and 2015, respectively. The FTE net interest income increased $1.1 million in prior year quarterly comparison primarily due to an increase in interest earned on loans. Purchase accounting adjustments accounted for $339,000 of the difference in net interest income for the fourth quarter comparisons. Fourth quarter 2016 net interest margin of 3.77% includes 16 bps related to purchase accounting adjustments. The increase in the fair value adjustment is related to improved asset quality on two loans.
Investment securities totaled $255.8 million, or 20.02% of total assets at December 31, 2016, versus $255.0 million, or 22.3% of total assets at December 31, 2015. The average volume of investment securities increased $7.4 million in prior year quarterly comparison. The average tax equivalent yield on investment securities decreased 5 bps to 2.62%. The investment portfolio had a net unrealized loss of $1.7 million at December 31, 2016 as compared to a net unrealized gain of $1.6 million at December 31, 2015.
The average yield on all earnings assets increased 4 basis points in prior year quarterly comparison, from 4.13% for the fourth quarter of 2015 to 4.17% for the fourth quarter of 2016. This increase was offset by an increase in average interest expense of 12 basis points from 0.39% for the fourth quarter of 2015 to 0.51% for the fourth quarter of 2016.
Fourth Quarter 2016 vs Third Quarter 2016 Earnings Comparison
In sequential-quarter comparison, net earnings available to common shareholders decreased $360,000 to $2.1 million which included after-tax acquisition charges of $282,000 and a one-time preferred dividend of $133,627.
FTE net interest income increased $0.6 million to $10.9 million from $10.3 million in sequential-quarter comparison. The increase was due primarily to increased loan volume and $0.3 million in increased accretion of purchase accounting adjustments.
The average yield on all earnings assets increased 4 basis points in sequential-quarter comparison, from 4.13% for the third quarter of 2016 to 4.17% for the fourth quarter of 2016.
Noninterest income decreased $394,000 in sequential-quarter comparison consisting of a decrease in mortgage income of $195,000 and other losses of $161,000 related to sale of other real estate and the disposal of fixed assets no longer in use.
Noninterest expense increased $716,000 in sequential-quarter comparison which includes an increase in salaries and benefits of $298,000. The majority of this increase was year-end payments related to vacation and bonus accrual. The increase in noninterest expense also included approximately $400,000 in acquisition charges and additional legal expenses associated with the proxy litigation.
Year over Year Earnings Comparison
In year-over-year comparison, net earnings available to common shareholders (inclusive of merger related costs) increased $1.2 million, or 14.3%, to $9.7 million at December 31, 2016 from $8.5 million at December 31, 2015. Operating earnings available to common shareholders (exclusive of merger related costs) increased $1.6 million, or 20% to $9.9 million at December 31, 2016 from $8.3 million at December 31, 2015. Net interest income increased $3.3 million in year-over-year comparison as interest income earned on a higher volume of loans attributed to this overall increase.
Noninterest income increased $3.7 million in year-over-year comparison mainly consisting of increases in mortgage income of $3.2 million.
Noninterest expenses increased $4.7 million in year-over-year comparison consisting of increases in salaries and benefits of $3.6 million of which $1.8 million is associated with the addition of The Mortgage Connection and increased mortgage commissions. Approximately $500,000 is associated with lending teams in Mobile, AL and Jackson, MS and the startup of a Treasury Management division. The remaining increase of $1.1 million includes the above mentioned merger related costs.
Dividends
The Board of Directors of The First Bancshares, Inc. announced a cash dividend was declared in the amount of $0.0375 per share to be paid on its common stock on February 24, 2017 to shareholders of record as of the close of business on February 6, 2017.
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 Mississippi, Louisiana and 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 Statements
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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FIRST BANCSHARES, INC and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited) (in thousands except per share data) |
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| EARNINGS DATA |
Quarter Ended 12/31/16 |
Quarter Ended 9/30/16 |
Quarter Ended 6/30/16 |
Quarter Ended 3/31/16 |
Quarter Ended 12/31/15 |
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| Total Interest Income | $ | 11,868 | $ | 11,269 | $ | 10,871 | $ | 10,597 | $ | 10,417 | ||||||||||||||||
| Total Interest Expense | 1,176 | 1,202 | 1,016 | 922 | 804 | |||||||||||||||||||||
| Net Interest Income | 10,692 | 10,067 | 9,855 | 9,675 | 9,613 | |||||||||||||||||||||
| FTE net interest income | 10,935 | 10,306 | 10,099 | 9,912 | 9,846 | |||||||||||||||||||||
| Provision for loan losses | 88 | 143 | 204 | 190 | 10 | |||||||||||||||||||||
| Non-interest income | 2,705 | 3,099 | 2,961 | 2,483 | 1,903 | |||||||||||||||||||||
| Non-interest expense | 10,132 | 9,416 | 8,921 | 8,395 | 8,275 | |||||||||||||||||||||
| Earnings before income taxes | 3,177 | 3,607 | 3,691 | 3,573 | 3,231 | |||||||||||||||||||||
| Income tax expense | 870 | 1,049 | 1,042 | 969 | 873 | |||||||||||||||||||||
| Net earnings | 2,307 | 2,558 | 2,649 | 2,604 | 2,358 | |||||||||||||||||||||
| Dividends and accretion on preferred stock | 195 | 86 | 86 | 85 | 85 | |||||||||||||||||||||
| Net earnings available to common shareholders | $ | 2,112 | $ | 2,472 | $ | 2,563 | $ | 2,519 | $ | 2,273 | ||||||||||||||||
| PER COMMON SHARE DATA | ||||||||||||||||||||||||||
| Basic earnings per share | $ | 0.39 | $ | 0.46 | $ | 0.47 | $ | 0.47 | $ | 0.42 | ||||||||||||||||
| Basic earnings per share, operating* | 0.44 | 0.48 | 0.47 | .043 | .040 | |||||||||||||||||||||
| Diluted earnings per share | 0.26 | 0.45 | 0.47 | 0.46 | 0.42 | |||||||||||||||||||||
| Diluted earnings per share, operating* | 0.30 | 0.48 | 0.47 | 0.43 | 0.40 | |||||||||||||||||||||
| Quarterly dividends per share | .0375 | .0375 | .0375 | .0375 | .0375 | |||||||||||||||||||||
| Book value per common share at end of period | 17.19 | 17.60 | 17.15 | 16.58 | 16.05 | |||||||||||||||||||||
| Tangible common book value at period end | 15.46 | 14.73 | 14.26 | 13.67 | 13.10 | |||||||||||||||||||||
| Market price at end of period | 27.50 | 19.10 | 17.27 | 15.63 | 18.34 | |||||||||||||||||||||
| Shares outstanding at period end | 8,991,397 | 5,428,017 | 5,432,014 | 5,432,014 | 5,376,665 | |||||||||||||||||||||
| Weighted average shares outstanding: | ||||||||||||||||||||||||||
| Basic | 5,463,651 | 5,425,567 | 5,432,014 | 5,415,339 | 5,376,665 | |||||||||||||||||||||
| Diluted | 8,500,305 | 5,475,785 | 5,490,592 | 5,478,703 | 5,449,851 | |||||||||||||||||||||
| AVERAGE BALANCE SHEET DATA | ||||||||||||||||||||||||||
| Total assets | $ | 1,275,538 | $ | 1,233,034 | $ | 1,210,707 | $ | 1,196,328 | $ | 1,131,924 | ||||||||||||||||
| Loans and leases | 856,798 | 836,931 | 809,806 | 779,418 | 757,036 | |||||||||||||||||||||
| Total deposits | 1,037,877 | 1,044,428 | 1,036,914 | 964,681 | 946,849 | |||||||||||||||||||||
| Total common equity | 94,750 | 94,007 | 88,643 | 87,155 | 84,122 | |||||||||||||||||||||
| Total tangible common equity* | 79,112 | 78,347 | 72,885 | 71,297 | 69,514 | |||||||||||||||||||||
| Total equity | 159,786 | 111,130 | 105,766 | 104,278 | 101,245 | |||||||||||||||||||||
| SELECTED RATIOS | ||||||||||||||||||||||||||
| Annualized return on avg assets | .72 | % | .83 | % | .88 | % | .87 | % | .83 | % | ||||||||||||||||
| Annualized return on avg assets, operating* | .75 | % | .85 | % | .85 | % | .78 | % | .76 | % | ||||||||||||||||
| Annualized return on avg common equity, operating* | 10.11 | % | 11.14 | % | 11.57 | % | 10.69 | % | 10.27 | % | ||||||||||||||||
| Annualized return on avg tangible common equity, oper* | 12.10 | % | 13.37 | % | 14.07 | % | 13.07 | % | 12.43 | % | ||||||||||||||||
| Average loans to average deposits | 82.55 | % | 80.13 | % | 78.10 | % | 80.80 | % | 79.95 | % | ||||||||||||||||
| Taxable-equivalent net interest margin | 3.77 | % | 3.70 | % | 3.68 | % | 3.68 | % | 3.81 | % | ||||||||||||||||
| Efficiency Ratio | 74.28 | % | 70.24 | % | 68.31 | % | 67.73 | % | 70.43 | % | ||||||||||||||||
| CREDIT QUALITY | ||||||||||||||||||||||||||
| Allowance for loan losses (ALLL) as a % of total loans | .87 | % | .88 | % | .88 | % | .88 | % | .87 | % | ||||||||||||||||
| Nonperforming assets to tangible equity + ALLL | 6.74 | % | 10.81 | % | 10.93 | % | 11.43 | % | 11.55 | % | ||||||||||||||||
| Nonperforming assets to total loans + ORE | 1.14 | % | 1.31 | % | 1.34 | % | 1.40 | % | 1.40 | % | ||||||||||||||||
| Annualized QTD net charge-offs (recoveries) to total loans | 0.03 | % | (0.04 | %) | (0.03 | %) | (0.02 | %) | (0.002 | %) | ||||||||||||||||
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*See reconciliation of Non-GAAP financial measures |
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FIRST BANCSHARES, INC and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited) (in thousands) |
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| BALANCE SHEET |
Dec 31, 2016 |
Sept 30, 2016 |
June 30, 2016 |
Mar 31, 2016 |
Dec 31, 2015 |
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| Assets | ||||||||||||||||||||||||||
| Cash and cash equivalents | $ | 62,119 | $ | 70,114 | $ | 54,777 | $ | 95,965 | $ | 41,259 | ||||||||||||||||
| Securities available-for-sale | 243,206 | 236,168 | 242,855 | 253,126 | 239,732 | |||||||||||||||||||||
| Securities held-to-maturity | 6,000 | 6,000 | 6,025 | 6,851 | 7,092 | |||||||||||||||||||||
| Other investments | 6,593 | 9,516 | 9,578 | 9,570 | 8,135 | |||||||||||||||||||||
| Total investment securities | 255,799 | 251,684 | 258,458 | 269,547 | 254,959 | |||||||||||||||||||||
| Loans held for sale | 5,880 | 9,437 | 8,937 | 6,095 | 3,974 | |||||||||||||||||||||
| Total loans | 867,054 | 854,366 | 824,083 | 797,764 | 772,515 | |||||||||||||||||||||
| Allowance for loan losses | (7,510 | ) | (7,481 | ) | (7,259 | ) | (6,982 | ) | (6,747 | ) | ||||||||||||||||
| Loans, net | 859,544 | 846,885 | 816,824 | 790,782 | 765,768 | |||||||||||||||||||||
| Premises and equipment | 34,624 | 33,427 | 33,502 | 33,353 | 33,623 | |||||||||||||||||||||
| Other Real Estate | 6,008 | 4,670 | 4,716 | 4,363 | 3,083 | |||||||||||||||||||||
| Goodwill and other intangibles | 15,507 | 15,596 | 15,696 | 15,796 | 15,891 | |||||||||||||||||||||
| Other assets | 37,886 | 34,825 | 31,990 | 26,050 | 26,574 | |||||||||||||||||||||
| Total assets | $ | 1,277,367 | $ | 1,266,638 | $ | 1,224,900 | $ | 1,241,951 | $ | 1,145,131 | ||||||||||||||||
| Liabilities and Shareholders’ Equity | ||||||||||||||||||||||||||
| Non-interest bearing deposits | $ | 202,478 | $ | 196,786 | $ | 194,950 | $ | 194,433 | $ | 189,445 | ||||||||||||||||
| Interest-bearing deposits | 836,713 | 875,003 | 837,413 | 846,672 | 727,250 | |||||||||||||||||||||
| Total deposits | 1,039,191 | 1,071,789 | 1,032,363 | 1,041,105 | 916,695 | |||||||||||||||||||||
| Borrowings | 69,000 | 68,000 | 68,000 | 78,976 | 110,321 | |||||||||||||||||||||
| Subordinated debentures | 10,310 | 10,310 | 10,310 | 10,310 | 10,310 | |||||||||||||||||||||
| Other liabilities | 4,339 | 3,881 | 3,929 | 4,363 | 4,369 | |||||||||||||||||||||
| Total liabilities | 1,122,840 | 1,153,980 | 1,114,602 | 1,134,754 | 1,041,695 | |||||||||||||||||||||
| Total shareholders’ equity | 154,527 | 112,658 | 110,298 | 107,197 | 103,436 | |||||||||||||||||||||
| Total liabilities and shareholders’ equity | $ | 1,277,367 | $ | 1,266,638 | $ | 1,224,900 | $ | 1,241,951 | $ | 1,145,131 | ||||||||||||||||
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FIRST BANCSHARES, INC and SUBSIDIARIES Condensed Consolidated Financial Information (unaudited) (in thousands except per share data) |
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| EARNINGS STATEMENT | Three Months Ended | |||||||||||||||
| 12/31/16 | 9/30/16 | 6/30/16 | 3/31/16 | 12/31/15 | ||||||||||||
| Interest Income: | ||||||||||||||||
| Loans, including fees | $ 9,922 | $ 9,706 | $ 9,293 | $ 9,013 | $ 8,874 | |||||||||||
| Investment securities | 1,472 | 1,446 | 1,531 | 1,532 | 1,472 | |||||||||||
| Accretion of purchase accounting adjustments | 429 | 92 | 20 | 22 | 59 | |||||||||||
| Other interest income | 45 | 25 | 27 | 30 | 12 | |||||||||||
| Total interest income | 11,868 | 11,269 | 10,871 | 10,597 | 10,417 | |||||||||||
| Interest Expense: | ||||||||||||||||
| Deposits | 968 | 962 | 813 | 701 | 657 | |||||||||||
| Borrowings | 148 | 160 | 149 | 193 | 131 | |||||||||||
| Subordinated debentures | 60 | 80 | 54 | 28 | 47 | |||||||||||
| Accretion of purchase accounting adjustments | - | - | - | - | (31) | |||||||||||
| Total interest expense | 1,176 | 1,202 | 1,016 | 922 | 804 | |||||||||||
| Net interest income | 10,692 | 10,067 | 9,855 | 9,675 | 9,613 | |||||||||||
| Provision for loan losses | 88 | 143 | 204 | 190 | 10 | |||||||||||
| Net interest income after provision for loan losses | 10,604 | 9,924 | 9,651 | 9,485 | 9,603 | |||||||||||
| Non-interest Income: | ||||||||||||||||
| Service charges on deposit accounts | 605 | 606 | 604 | 637 | 674 | |||||||||||
| Mortgage Income | 1,204 | 1,399 | 1,184 | 645 | 245 | |||||||||||
| Interchange Fee Income | 683 | 666 | 681 | 644 | 650 | |||||||||||
| Gain (loss) on securities, net | (3) | - | 129 | - | - | |||||||||||
| Gain on sale of premises and equipment | - | - | - | - | - | |||||||||||
| BEA award, net | - | - | - | - | 152 | |||||||||||
| Other charges and fees | 216 | 428 | 363 | 557 | 182 | |||||||||||
| Total non-interest income | 2,705 | 3,099 | 2,961 | 2,483 | 1,903 | |||||||||||
| Non-interest expense: | ||||||||||||||||
| Salaries and employee benefits | 5,943 | 5,645 | 5,400 | 5,149 | 4,670 | |||||||||||
| Occupancy expense | 1,222 | 1,209 | 1,110 | 1,073 | 1,107 | |||||||||||
| FDIC premiums | 265 | 254 | 257 | 244 | 243 | |||||||||||
| Marketing | 122 | 76 | 132 | 72 | 150 | |||||||||||
| Amortization of core deposit intangibles | 88 | 100 | 100 | 94 | 100 | |||||||||||
| Other professional services | 793 | 461 | 321 | 231 | 377 | |||||||||||
| Other non-interest expense | 1,699 | 1,671 | 1,601 | 1,532 | 1,628 | |||||||||||
| Total Non-interest expense | 10,132 | 9,416 | 8,921 | 8,395 | 8,275 | |||||||||||
| Earnings before income taxes | 3,177 | 3,607 | 3,691 | 3,573 | 3,231 | |||||||||||
| Income tax expense | 870 | 1,049 | 1,042 | 969 | 873 | |||||||||||
| Net earnings | 2,307 | 2,558 | 2,649 | 2,604 | 2,358 | |||||||||||
| Dividends and accretion on preferred stock | 195 | 86 | 86 | 85 | 85 | |||||||||||
| Net earnings available to common shareholders | $ 2,112 | $ 2,472 | $ 2,563 | $ 2,519 | $ 2,273 | |||||||||||
| Basic earnings per common share | $ 0.39 | $ 0.46 | $ 0.47 | $ 0.47 | $ 0.42 | |||||||||||
| Basic earnings per common share, operating* | $ 0.44 | $ 0.48 | $ 0.47 | $ 0.43 | $ 0.40 | |||||||||||
| Diluted earnings per common share | $ 0.26 | $ 0.45 | $ 0.47 | $ 0.46 | $ 0.42 | |||||||||||
| Diluted earnings per common share, operating* | $ 0.30 | $ 0.48 | $ 0.47 | $ 0.43 | $ 0.40 | |||||||||||
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*See reconciliation of Non-GAAP financial measures |
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FIRST BANCSHARES, INC and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited) (in thousands except per share data) |
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| EARNINGS STATEMENT |
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Year to Date |
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| 2016 | 2015 | |||||||||
| Interest Income: | ||||||||||
| Loans, including fees | $ | 37,934 | $ | 34,038 | ||||||
| Investment securities | 5,981 | 5,896 | ||||||||
| Accretion of purchase accounting adjustments | 563 | 204 | ||||||||
| Other interest income | 127 | 64 | ||||||||
| Total interest income | 44,605 | 40,202 | ||||||||
| Interest Expense: | ||||||||||
| Deposits | 3,444 | 2,733 | ||||||||
| Borrowings | 650 | 460 | ||||||||
| Subordinated debentures | 222 | 185 | ||||||||
| Accretion of purchase accounting adjustments | - | -171 | ||||||||
| Total interest expense | 4,316 | 3,207 | ||||||||
| Net interest income | 40,289 | 36,995 | ||||||||
| Provision for loan losses | 625 | 410 | ||||||||
| Net interest income after provision for loan losses | 39,664 | 36,585 | ||||||||
| Non-interest Income: | ||||||||||
| Service charges on deposit accounts | 2,452 | 2,570 | ||||||||
| Mortgage Income | 4,432 | 1,277 | ||||||||
| Interchange Fee Income | 2,674 | 2,444 | ||||||||
| Gain (loss) on securities, net | 126 | - | ||||||||
| Gain on sale of premises and equipment | - | 110 | ||||||||
| BEA award, net | - | 152 | ||||||||
| Other charges and fees | 1,564 | 1,036 | ||||||||
| Total non-interest income | 11,248 | 7,589 | ||||||||
| Non-interest expense: | ||||||||||
| Salaries and employee benefits | 22,137 | 18,537 | ||||||||
| Occupancy expense | 4,614 | 4,489 | ||||||||
| FDIC premiums | 1,020 | 966 | ||||||||
| Marketing | 402 | 437 | ||||||||
| Amortization of core deposit intangibles | 382 | 400 | ||||||||
| Other professional services | 1,806 | 1,332 | ||||||||
| Other non-interest expense | 6,503 | 6,001 | ||||||||
| Total Non-interest expense | 36,864 | 32,162 | ||||||||
| Earnings before income taxes | 14,048 | 12,012 | ||||||||
| Income tax expense | 3,930 | 3,213 | ||||||||
| Net earnings | 10,118 | 8,799 | ||||||||
| Dividends and accretion on preferred stock | 452 | 342 | ||||||||
| Net earnings available to common shareholders | $ | 9,666 | $ | 8,457 | ||||||
| Non-operating items* | 239 | (196 | ) | |||||||
| Net earnings available to common shareholders, operating | $ | 9,905 | $ | 8,261 | ||||||
| Basic earnings per common share | $ | 1.78 | $ | 1.54 | ||||||
| Basic earnings per common share, operating* | $ | 1.86 | $ | 1.52 | ||||||
| Diluted earnings per common share | $ | 1.57 | $ | 1.57 | ||||||
| Diluted earnings per common share, operating* | $ | 1.64 | $ | 1.55 | ||||||
|
FIRST BANCSHARES, INC and SUBSIDIARIES Condensed Consolidated Financial Information (unaudited) (in thousands) |
||||||||||||||||||||||||||||||||||
| COMPOSITION OF LOANS |
Dec 31, 2016 |
Percent of Total |
Sept 30, 2016 |
June 30, 2016 |
Mar 31, 2016 |
Dec 31, 2015 |
Percent of Total |
|||||||||||||||||||||||||||
| Commercial, financial and agricultural | $ | 129,423 | 14.8 | % | $ | 121,963 | $ | 118,924 | $ | 126,381 | $ | 129,197 | 16.6 | % | ||||||||||||||||||||
| Real estate – construction | 109,394 | 12.5 | % | 104,644 | 101,439 | 100,386 | 99,161 | 12.8 | % | |||||||||||||||||||||||||
| Real estate – commercial | 314,359 | 36.0 | % | 307,963 | 296,676 | 270,085 | 253,309 | 32.6 | % | |||||||||||||||||||||||||
| Real estate – residential | 289,640 | 33.2 | % | 296,587 | 282,420 | 276,272 | 272,180 | 35.1 | % | |||||||||||||||||||||||||
| Lease Financing Receivable | 2,204 | 0.3 | % | 2,211 | 2,642 | 2,645 | 2,650 | 0.3 | % | |||||||||||||||||||||||||
| Obligations of States & subdivisions | 6,698 | 0.8 | % | 6,861 | 6,965 | 7,034 | 969 | 0.1 | % | |||||||||||||||||||||||||
| Consumer | 15,336 | 1.8 | % | 14,137 | 15,017 | 14,961 | 15,049 | 1.9 | % | |||||||||||||||||||||||||
| Loans held for sale | 5,880 | 0.6 | % | 9,437 | 8,937 | 6,095 | 3,974 | 0.6 | % | |||||||||||||||||||||||||
| Total loans | $ | 872,934 | 100 | % | $ | 863,803 | $ | 833,020 | $ | 803,859 | $ | 776,489 | 100 | % | ||||||||||||||||||||
| COMPOSITION OF DEPOSITS |
Dec 31, 2016 |
Percent of Total |
Sept 30, 2016 |
June 30, 2016 |
Mar 31, 2015 |
Dec 31, 2015 |
Percent of Total |
|||||||||||||||||||||||||||
| Noninterest bearing | $ | 202,478 | 19.5 | % | $ | 196,786 | $ | 194,950 | $ | 194,433 | $ | 189,445 | 20.7 | % | ||||||||||||||||||||
| NOW and other | 430,903 | 41.5 | % | 465,404 | 466,118 | 493,319 | 373,687 | 40.8 | % | |||||||||||||||||||||||||
| Money Market/Savings | 182,793 | 17.6 | % | 187,228 | 174,740 | 169,733 | 174,090 | 19.0 | % | |||||||||||||||||||||||||
| Time Deposits of less than $100,000 | 77,684 | 7.5 | % | 78,785 | 72,389 | 72,295 | 73,865 | 8.1 | % | |||||||||||||||||||||||||
| Time Deposits of $100,000 or more | 145,333 | 13.9 | % | 143,586 | 124,166 | 111,325 | 105,608 | 11.4 | % | |||||||||||||||||||||||||
| Total Deposits | $ | 1,039,191 | 100 | % | $ | 1,071,789 | $ | 1,032,363 | $ | 1,041,105 | $ | 916,695 | 100 | % | ||||||||||||||||||||
| ASSET QUALITY DATA |
Dec 31, 2016 |
|
Sept 30, 2016 |
June 30, 2016 |
Mar 31, 2015 |
Dec 31, 2015 |
||||||||||||||||||||||||||||
| Nonaccrual loans | $ | 3,265 | $ | 5,798 | $ | 5,742 | $ | 5,851 | $ | 7,368 | ||||||||||||||||||||||||
| Loans past due 90 days and over | 198 | 420 | 267 | 628 | 29 | |||||||||||||||||||||||||||||
| Total nonperforming loans | 3,463 | 6,218 | 6,009 | 6,479 | 7,397 | |||||||||||||||||||||||||||||
| Other real estate | 6,008 | 4,670 | 4,716 | 4,363 | 3,083 | |||||||||||||||||||||||||||||
| Nonaccrual securities | 408 | 408 | 408 | 408 | 408 | |||||||||||||||||||||||||||||
| Total nonperforming assets | $ | 9,879 | $ | 11,296 | $ | 11,133 | $ | 11,250 | $ | 10,888 | ||||||||||||||||||||||||
| Nonperforming assets to total assets | .77 | % | .89 | % | .91 | % | .91 | % | .95 | % | ||||||||||||||||||||||||
| Nonperforming assets to total loans + ORE | 1.14 | % | 1.31 | % | 1.34 | % | 1.40 | % | 1.40 | % | ||||||||||||||||||||||||
| ALLL to nonperforming loans | 216.86 | % | 120.31 | % | 120.80 | % | 107.80 | % | 91.21 | % | ||||||||||||||||||||||||
| ALLL to total loans | .87 | % | .88 | % | .88 | % | .88 | % | .87 | % | ||||||||||||||||||||||||
| Quarter-to-date net charge-offs (recoveries) | $ | 58 | $ | (79 | ) | $ | (72 | ) | $ | (48 | ) | $ | (3 | ) | ||||||||||||||||||||
| Annualized QTD net chg/offs (recs) to loans | 0.03 | % | (0.04 | %) | (0.03 | %) | (0.02 | %) | (0.002 | %) | ||||||||||||||||||||||||
| FIRST BANCSHARES, INC and SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Condensed Consolidated Financial Information (unaudited) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Yield | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Analysis | December 31, 2016 | September 30, 2016 | June 30, 2016 | March 31, 2016 | December 31, 2015 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Tax | Tax | Tax | Tax | Tax | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Avg | Equivalent | Yield/ | Avg | Equivalent | Yield/ | Avg | Equivalent | Yield/ | Avg | Equivalent | Yield/ | Avg | Equivalent | Yield/ | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance | interest | Rate | Balance | interest | Rate | Balance | interest | Rate | Balance | interest | Rate | Balance | interest | Rate | |||||||||||||||||||||||||||||||||||||||||||||||||||
| Taxable securities | $ | 183,032 | $ | 997 | 2.18 | % | $ | 177,154 | $ | 965 | 2.18 | % | $ | 186,615 | $ | 1,034 | 2.22 | % | $ | 189,249 | $ | 1,056 | 2.23 | % | $ | 177,964 | $ | 1,006 | 2.26 | % | |||||||||||||||||||||||||||||||||||
|
Tax-exempt securities |
77,909 | 715 | 3.67 | % | 77,073 | 704 | 3.65 | % | 78,290 | 721 | 3.68 | % | 76,795 | 693 | 3.61 | % | 75,570 | 685 | 3.63 | % | |||||||||||||||||||||||||||||||||||||||||||||
|
Total investment securities |
260,941 | 1,712 | 2.62 | % | 254,227 | 1,669 | 2.63 | % | 264,905 | 1,755 | 2.65 | % | 266,044 | 1,749 | 2.63 | % | 253,534 | 1,691 | 2.67 | % | |||||||||||||||||||||||||||||||||||||||||||||
| Fed funds sold | 41,545 | 45 | 0.43 | % | 10,356 | 25 | 0.97 | % | 9,902 | 27 | 1.09 | % | 12,395 | 30 | 0.97 | % | 405 | 1 | 0.99 | % | |||||||||||||||||||||||||||||||||||||||||||||
|
Int bearing deposits in other banks |
2,107 | 3 | 0.57 | % | 11,961 | 16 | 0.54 | % | 12,522 | 20 | 0.64 | % | 20,909 | 20 | 0.38 | % | 21,601 | 25 | 0.46 | % | |||||||||||||||||||||||||||||||||||||||||||||
| Loans | 856,798 | 10,351 | 4.83 | % | 836,931 | 9,798 | 4.68 | % | 809,806 | 9,313 | 4.60 | % | 779,418 | 9,035 | 4.64 | % | 757,036 | 8,933 | 4.72 | % | |||||||||||||||||||||||||||||||||||||||||||||
|
Total Interest earning assets |
1,161,391 | 12,111 | 4.17 | % | 1,113,475 | 11,508 | 4.13 | % | 1,097,135 | 11,115 | 4.05 | % | 1,078,766 | 10,834 | 4.02 | % | 1,032,576 | 10,650 | 4.13 | % | |||||||||||||||||||||||||||||||||||||||||||||
| Other assets | 114,147 | 119,559 | 113,572 | 117,562 | 99,348 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total assets | $ | 1,275,538 | $ | 1,233,034 | $ | 1,210,707 | $ | 1,196,328 | $ | 1,131,924 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Interest-bearing liabilities: |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Deposits | $ | 844,101 | $ | 968 | 0.46 | % | $ | 850,442 | $ | 962 | 0.45 | % | $ | 843,771 | $ | 813 | 0.39 | % | $ | 777,692 | $ | 701 | 0.36 | % | $ | 752,098 | $ | 626 | 0.33 | % | |||||||||||||||||||||||||||||||||||
| Repo | 5,000 | 48 | 3.84 | % | 5,000 | 49 | 3.92 | % | 5,000 | 48 | 3.84 | % | 5,000 | 48 | 3.84 | % | 5,000 | 48 | 3.84 | % | |||||||||||||||||||||||||||||||||||||||||||||
| Fed funds purchased | 191 | 1 | 2.09 | % | 1,926 | 5 | 1.04 | % | 2,894 | 8 | 1.11 | % | 782 | 2 | 1.02 | % | 1,984 | 6 | 1.21 | % | |||||||||||||||||||||||||||||||||||||||||||||
| FHLB & FTN | 56,272 | 98 | 0.70 | % | 55,337 | 106 | 0.77 | % | 42,962 | 93 | 0.87 | % | 106,352 | 143 | 0.54 | % | 60,961 | 77 | 0.51 | % | |||||||||||||||||||||||||||||||||||||||||||||
|
Subordinated debentures |
10,310 | 61 | 2.37 | % | 10,310 | 80 | 3.10 | % | 10,310 | 54 | 2.10 | % | 10,310 | 28 | 1.09 | % | 10,310 | 47 | 1.82 | % | |||||||||||||||||||||||||||||||||||||||||||||
|
Total interest bearing liabilities |
915,874 | 1,176 | 0.51 | % | 923,015 | 1,202 | 0.52 | % | 904,937 | 1,016 | 0.45 | % | 900,136 | 922 | 0.41 | % | 830,353 | 804 | 0.39 | % | |||||||||||||||||||||||||||||||||||||||||||||
| Other liabilities | 199,878 | 198,889 | 200,004 | 191,914 | 200,326 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shareholders' equity | 159,786 | 111,130 | 105,766 | 104,278 | 101,245 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Total liabilities and shareholders' equity |
$ | 1,275,538 | $ | 1,233,034 | $ | 1,210,707 | $ | 1,196,328 | $ | 1,131,924 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Net interest income (TE) |
$ | 10,935 | 3.66 | % | $ | 10,306 | 3.61 | % | $ | 10,099 | 3.60 | % | $ | 9,912 | 3.61 | % | $ | 9,846 | 3.74 | % | |||||||||||||||||||||||||||||||||||||||||||||
| Net interest margin | 3.77 | % | 3.70 | % | 3.68 | % | 3.68 | % | 3.79 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Core net interest margin* |
3.61 | % | 3.66 | % | 3.67 | % | 3.66 | % | 3.77 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
FIRST BANCSHARES, INC and SUBSIDIARIES
Reconcilement of Non-GAAP Financial Measures (unaudited) (in thousands except per share data) |
||||||||||||||||||||||||||||
|
Three Months Ended |
||||||||||||||||||||||||||||
|
Per Common Share Data |
Dec 31, 2016 |
Sept 30, 2016 |
June 30, 2016 |
Mar 31, 2016 |
Dec 31, 2015 |
|||||||||||||||||||||||
| Book value per common share | $ | 17.19 | $ | 17.60 | $ | 17.15 | $ | 16.58 | $ | 16.05 | ||||||||||||||||||
| Effect of intangible assets per share | 1.73 | 2.87 | 2.89 | 2.91 | 2.95 | |||||||||||||||||||||||
| Tangible book value per common share | $ | 15.46 | $ | 14.73 | $ | 14.26 | $ | 13.67 | $ | 13.10 | ||||||||||||||||||
| Diluted earnings per share | $ | 0.26 | $ | 0.45 | $ | 0.47 | $ | 0.46 | $ | 0.42 | ||||||||||||||||||
| Effect of gain on debit card conversion, after-tax | - | - | - | (0.03 | ) | - | ||||||||||||||||||||||
| Effect of gain on sale of bank premises, after-tax | - | - | - | - | - | |||||||||||||||||||||||
| Effect of BAE, after-tax | - | - | - | - | (0.02 | ) | ||||||||||||||||||||||
| Effect of acquisition charges, after-tax | 0.04 | 0.03 | - | - | - | |||||||||||||||||||||||
| Diluted earnings per share, operating | $ | 0.30 | $ | 0.48 | $ | 0.47 | $ | 0.43 | $ | 0.40 | ||||||||||||||||||
| Three Months Ended | ||||||||||||||||||||||||||||
| Average Balance Sheet Data |
Dec 31, 2016 |
Sept 30, 2016 |
June 30, 2016 |
Mar 31, 2016 |
Dec 31, 2015 |
|||||||||||||||||||||||
|
Total average assets |
A |
$ | 1,275,538 | $ | 1,233,034 | $ | 1,210,707 | $ | 1,196,328 | $ | 1,131,924 | |||||||||||||||||
| Total equity | $ | 159,786 | $ | 111,130 | $ | 105,766 | $ | 104,278 | $ | 101,245 | ||||||||||||||||||
| Less preferred equity | 65,036 | 17,123 | 17,123 | 17,123 | 17,123 | |||||||||||||||||||||||
|
Total common equity |
B |
94,750 | 94,007 | 88,643 | 87,155 | 84,122 | ||||||||||||||||||||||
| Less intangible assets | 15,638 | 15,660 | 15,758 | 15,858 | 14,608 | |||||||||||||||||||||||
|
Tangible common equity |
C |
$ | 79,112 | $ | 78,347 | $ | 72,885 | $ | 71,297 | $ | 69,514 | |||||||||||||||||
| Three Months Ended | ||||||||||||||||||||||||||||
| Core Net Interest Margin |
Dec 31, 2016 |
Sept 30, 2016 |
June 30, 2016 |
Mar 31, 2016 |
Dec 31, 2015 |
|||||||||||||||||||||||
| Net interest income (TE) | $ | 10,935 | $ | 10,306 | $ | 10,099 | $ | 9,912 | $ | 9,846 | ||||||||||||||||||
| Less purchase accounting adjustments | 429 | 92 | 20 | 22 | 90 | |||||||||||||||||||||||
|
Net interest income, net of purchase accounting adj |
D |
$ | 10,506 | $ | 10,214 | $ | 10,079 | $ | 9,890 | $ | 9,756 | |||||||||||||||||
| Total average earning assets | $ | 1,161,391 | $ | 1,113,475 | $ | 1,097,135 | $ | 1,078,766 | $ | 1,032,576 | ||||||||||||||||||
| Add average balance of loan valuation discount | 1,358 | 1,484 | 1,504 | 1,526 | 1,583 | |||||||||||||||||||||||
|
Avg earning assets, excluding loan valuation discount |
E |
$ | 1,162,749 | $ | 1,114,959 | $ | 1,098,639 | $ | 1,080,292 | $ | 1,034,159 | |||||||||||||||||
|
Core net interest margin |
D/E |
3.61 | % | 3.66 | % | 3.67 | % | 3.66 | % | 3.77 | % | |||||||||||||||||
| Three Months Ended | ||||||||||||||||||||||||||||
| Return Ratios |
Dec 31, 2016 |
Sept 30, 2016 |
June 30, 2016 |
Mar 31, 2016 |
Dec 31, 2015 |
|||||||||||||||||||||||
|
Net earnings |
F |
$ | 2,307 | $ | 2,558 | $ | 2,649 | $ | 2,604 | $ | 2,358 | |||||||||||||||||
| Dividends and accretion on preferred stock | 195 | 86 | 86 | 85 | 85 | |||||||||||||||||||||||
| Net earnings available to common shareholders | 2,112 | 2,472 | 2,563 | 2,519 | 2,273 | |||||||||||||||||||||||
| Gain on debit card conversion, after-tax | - | - | - | (189 | ) | - | ||||||||||||||||||||||
| Gain on sale of premises and equipment, after-tax | - | - | - | - | - | |||||||||||||||||||||||
| BAE, after-tax | - | - | - | - | (112 | ) | ||||||||||||||||||||||
| Acquisition charges, after-tax | 282 | 146 | - | - | - | |||||||||||||||||||||||
|
Net earnings available to common shareholders, oper |
G |
$ | 2,394 | $ | 2,618 | $ | 2,563 | $ | 2,330 | $ | 2,161 | |||||||||||||||||
|
Annualized return on avg assets |
F/A |
.72 | % | .83 | % | .88 | % | .87 | % | .83 | % | |||||||||||||||||
|
Annualized return on avg assets, oper |
G/A |
.75 | % | .85 | % | .85 | % | .78 | % | .76 | % | |||||||||||||||||
|
Annualized return on avg common equity, oper |
G/B |
10.11 | % | 11.14 | % | 11.57 | % | 10.69 | % | 10.27 | % | |||||||||||||||||
|
Annualized return on avg tangible common equity, oper |
G/C |
12.10 | % | 13.37 | % | 14.07 | % | 13.07 | % | 12.43 | % | |||||||||||||||||
| Mortgage Department | ||||||||||||||||||||||||||||
| Net Interest Income after provision for loan losses | $ | 48 | $ | 24 | $ | 59 | $ | 125 | $ | 150 | ||||||||||||||||||
| Loan fee income | 1,204 | 1,399 | 1,184 | 645 | 245 | |||||||||||||||||||||||
| Other non-interest income | 1 | 1 | 3 | 2 | - | |||||||||||||||||||||||
| Salaries and employee benefits | 783 | 805 | 724 | 563 | 263 | |||||||||||||||||||||||
| Other non-interest expense | 144 | 124 | 110 | 90 | 49 | |||||||||||||||||||||||
| Earnings before income taxes | $ | 326 | $ | 495 | $ | 412 | $ | 119 | $ | 83 | ||||||||||||||||||
Certain financial information included in the earnings release and the associated Condensed Consolidated Financial Information (unaudited) is determined by methods other than in accordance with GAAP.
We use non-GAAP measures because we believe they are useful for evaluating our financial condition with a meaningful measure for assessing our financial condition as well as comparison to financial results for prior periods. These results should not be viewed as a substitute for results determined in accordance with GAAP, and are necessarily comparable to non-GAAP performance measures that other companies may use.
