The First Bancshares, Inc. (NASDAQ: FBMS), holding company for The First, A National Banking Association, (www.thefirstbank.com) today reported earnings for the fourth quarter and fiscal year ended December 31, 2014. The First Bancshares, Inc. also announced a quarterly dividend of $.0375 per common share. The record date will be February 12, 2015 with a payable date of February 27, 2015.
Net income available to common stockholders for the three months ended December 31, 2014 amounted to $1,955,000, or $0.36 per diluted share, compared to $1,392,000, or $0.27 per diluted share for the same quarter in 2013, an increase of $563,000 or 40.4% in net income available to common stockholders.
Net income available to common stockholders for the year ended December 31, 2014 amounted to $6,251,000, or $1.19 per diluted share, compared to $4,215,000, or $0.96 per diluted share for the same period in 2013, an increase of $2,036,000 or 48.3% in net income available to common stockholders. Net income available to common stockholders exclusive of one-time items for the twelve months ended December 31, 2014 was $6,186,000, or $1.17 per diluted share, a 26.8% increase in net income available to common stockholders compared to $4,878,000 of net income available to common stockholders exclusive of one-time items for the twelve months ended December 31, 2013.
M. Ray “Hoppy” Cole, President & Chief Executive Officer, commented, “We are thrilled with the results our Company achieved during 2014. Outstanding execution by our team members produced exceptional asset growth across our entire footprint and a 40% increase in net income year over year. We remain focused on increasing our earnings through continued growth and improved operating efficiency. We are excited about the opportunities for our Company in 2015 and look forward to creating additional value for our shareholders.”
Balance Sheet Highlights
Total assets for the Company totaled $1.1 billion at December 31, 2014, an increase of $21.5 million compared with September 30, 2014. The increase during the fourth quarter of 2014 was attributable to the Company’s substantial loan growth during the period.
December 31, 2014 loans outstanding increased by $35.3 million, or approximately 21.0% on an annualized basis, compared with September 30, 2014, and increased $123.3 million, or 21.1%, compared to December 31, 2013 total loans outstanding. Loan growth of $123.3 million was composed of $40.9 million of loans acquired from Bay Bank and $24.2 million in loans generated from our new Baton Rouge location. The remaining loan growth of $58.2 million was diversified across our footprint from existing markets.
End of Period Loan Balances | 12/31/14 | 09/30/14 | 12/31/13 | ||||||
| (dollars in thousands) | |||||||||
| Loans held for sale | $2,103 | $3,769 | $3,680 | ||||||
| Commercial | 106,109 | 100,263 | 81,792 | ||||||
| Real Estate: | |||||||||
| Mortgage-commercial | 238,602 | 217,684 | 212,388 | ||||||
| Mortgage-residential | 256,406 | 248,125 | 202,343 | ||||||
| Construction | 84,935 | 83,908 | 67,287 | ||||||
| Consumer and other | 18,479 | 17,553 | 15,813 | ||||||
| $706,634 | $671,302 | $583,303 | |||||||
Non-performing assets totaled $11.6 million at December 31, 2014 compared to $11.4 million of non-performing assets at September 30, 2014 and $9.8 million at December 31, 2013. Non-performing assets represented 1.06% of total assets at December 31, 2014 compared to 1.06% of total assets at September 30, 2014, and compared to 1.04% at December 31, 2013. Non-performing loans totaled $6.7 million at December 31, 2014 compared to $6.1 million at September 30, 2014 and compared to $3.3 million of non-performing loans at December 31, 2013. Non-performing loans represented 0.95% of total loans at December 31, 2014 compared with 0.91% of total outstanding loans at September 30, 2014 and 0.57% of total loans outstanding at December 31, 2013.
Non-Performing Assets | 12/31/14 | 09/30/14 | 12/31/13 | ||||||
| (dollars in thousands) | |||||||||
| Non-Accrual Loans | $6,056 | $6,032 | $3,181 | ||||||
| Past Due Loans (90 days or more) | 669 | 102 | 159 | ||||||
| Total Non-Performing Loans | 6,725 | 6,134 | 3,340 | ||||||
| Non-Accrual Securities | 250 | 250 | 1,950 | ||||||
| Other Real Estate | 4,654 | 4,986 | 4,470 | ||||||
| Total Non-Performing Assets | $11,629 | $11,370 | $9,760 | ||||||
The Company’s allowance for loan losses totaled $6.1 million at December 31, 2014 and September 30, 2014, representing an increase of $367,000, or 6.4% on an annualized basis, from December 31, 2013. The allowance for loan losses represented 0.86% of period-end loans at December 31, 2014 compared with 0.91% of period-end loans at September 30, 2014 and 0.98% of period-end loans at December 31, 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 1.01% of period end loans excluding those booked at fair value at December 31, 2014 compared with 1.10% at September 30, 2014 and 1.21% at December 31, 2013.
Total deposits decreased $14.7 million or 6.5% on an annualized basis, as of December 31, 2014 compared with September 30, 2014 total deposits and increased by approximately $112.8 million or 14.5% compared with December 31, 2013. Deposits of $58.1 million were acquired from Bay Bank on July 1, 2014. Non-interest-bearing demand deposits increased $27.6 million, or 15.9% when comparing December 31, 2014 to December 31, 2013.
End of Period Deposit Balances | 12/31/14 | 09/30/14 | 12/31/13 | ||||||
| (dollars in thousands) | |||||||||
| Non-interest-bearing Demand Deposits | $201,362 | $195,957 | $173,794 | ||||||
| IB Demand, Savings, and MMDA Accounts | 485,354 | 500,637 | 403,190 | ||||||
| Time Deposits < $100,000 | 85,365 | 86,897 | 85,880 | ||||||
| Time Deposits > $100,000 | 120,694 | 124,024 | 117,107 | ||||||
| $892,775 | $907,515 | $779,971 | |||||||
Results of Operations Highlights – Quarter ended December 31, 2014
Net income available to common stockholders for the quarter ended December 31, 2014 totaled $1,955,000 or $0.36 per diluted share, an increase of $563,000 or 40.4% from the fourth quarter of 2013 net income available to common stockholders of $1,392,000 or $0.27 per diluted share.
During the quarter ended December 31, 2014, net interest income totaled $8,871,000 representing an increase of $1,105,000, or 14.2%, compared with the quarter ended December 31, 2013 net interest income of $7,766,000. The tax equivalent net interest margin for the quarter ended December 31, 2014 was 3.76% compared to 3.76% in the fourth quarter of 2013. The increase in net interest income during the quarter ended December 31, 2014 compared with the fourth quarter of 2013 was attributable primarily to increased average loans outstanding.
Fair value accounting adjustments on acquired assets and liabilities contributed approximately 4 basis points on an annualized basis to the net interest margin in the fourth quarter of 2014 and 11 basis points in the fourth quarter of 2013.
During the quarter ended December 31, 2014, non-interest income totaled $2,055,000, an increase of $34,000 or 1.7%, compared with the quarter ended September 30, 2014, and an increase of $384,000, or 23.0%, compared with the fourth quarter of 2013. The overall increase in non-interest income for the quarter ended December 31, 2014 is attributed to an increase of $115,000, or 34.8% in mortgage income as well as an increase in other operating income consisting of a BEA award of $223,000 received as compared to the quarter ended December 31, 2013.
Quarter | Quarter | Quarter | |||||||
Non-interest Income | 12/31/14 | 09/30/14 | 12/31/13 | ||||||
| (dollars in thousands) | |||||||||
| Service Charges on Deposit Accounts | $608 | $616 | $617 | ||||||
| Mortgage Income | 445 | 522 | 330 | ||||||
| Interchange Fee Income | 561 | 563 | 479 | ||||||
| Other Operating Income | 441 | 320 | 245 | ||||||
| Total Non-interest Income | $2,055 | $2,021 | $1,671 | ||||||
During the quarter ended December 31, 2014, non-interest expense totaled $8,051,000, a decrease of $20,000, or 0.2%, compared with the quarter ended September 30, 2014, and an increase of $743,000, or 10.2%, compared with the fourth quarter of 2013.
Quarter | Quarter | Quarter | |||||||
Non-interest Expense | 12/31/14 | 09/30/14 | 12/31/13 | ||||||
| (dollars in thousands) | |||||||||
| Salaries and Employee Benefits | $4,551 | $4,554 | $3,932 | ||||||
| Occupancy, Furniture and Equipment Expense | 1,156 | 1,209 | 1,057 | ||||||
| FDIC Premiums | 271 | 222 | 231 | ||||||
| Professional Fees | 412 | 429 | 375 | ||||||
| Advertising and Promotion | 160 | 94 | 160 | ||||||
| Intangible Amortization | 100 | 98 | 94 | ||||||
| Other Operating Expenses | 1,401 | 1,465 | 1,459 | ||||||
| Total Non-interest Expense | $8,051 | $8,071 | $7,308 | ||||||
Total non-interest expense for the fourth quarter of 2014 increased as compared to the fourth quarter of 2013. This increase is primarily related to increases in salaries and employee benefits associated with the acquisition of Bay Bank on July 1, 2014 as well as the expansion into Baton Rouge, LA. One-time acquisition charges were approximately $30,000 in fourth quarter 2014 as well as 2013.
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.
THE FIRST BANCSHARES, INC. Consolidated Balance Sheets | |||||||||||||||
Dec 31, | Sept 30, | Dec 31, | |||||||||||||
| ASSETS | |||||||||||||||
| Cash and Due from Banks | $ | 30,333 | $ | 33,111 | $ | 24,080 | |||||||||
| Federal funds sold | 386 | 1,298 | 967 | ||||||||||||
| Interest-bearing deposits with banks | 13,899 | 16,038 | 14,205 | ||||||||||||
| Investment Securities | 270,174 | 276,654 | 258,023 | ||||||||||||
| Loans held for sale | 2,103 | 3,769 | 3,680 | ||||||||||||
| Loans, Net of Unearned Income | 704,531 | 667,533 | 579,623 | ||||||||||||
| Allowance for Loan Losses | (6,095 | ) | (6,084 | ) | (5,728 | ) | |||||||||
| Net Loans | 698,436 | 661,449 | 573,895 | ||||||||||||
| Premises and Equipment | 34,810 | 35,079 | 32,072 | ||||||||||||
| Other Real Estate Owned | 4,654 | 4,986 | 4,470 | ||||||||||||
| Goodwill | 12,276 | 12,310 | 10,621 | ||||||||||||
| Other Assets | 26,697 | 27,568 | 18,877 | ||||||||||||
| TOTAL ASSETS | $ | 1,093,768 | $ | 1,072,262 | $ | 940,890 | |||||||||
LIABILITIES | |||||||||||||||
| Non-interest-bearing Demand Deposits | $ | 201,362 | $ | 195,957 | $ | 173,794 | |||||||||
| Interest-bearing Accounts | 485,354 | 500,637 | 403,190 | ||||||||||||
| Time Deposits | 206,059 | 210,921 | 202,987 | ||||||||||||
| Total Deposits | 892,775 | 907,515 | 779,971 | ||||||||||||
| Borrowings | 89,450 | 49,456 | 52,000 | ||||||||||||
| Subordinated Debentures | 10,310 | 10,310 | 10,310 | ||||||||||||
| Other Liabilities | 5,017 | 11,117 | 13,501 | ||||||||||||
| TOTAL LIABILITIES | 997,552 | 978,398 | 855,782 | ||||||||||||
| STOCKHOLDER’S EQUITY | |||||||||||||||
| Preferred Stock | 17,123 | 17,123 | 17,103 | ||||||||||||
| Common Stock | 5,343 | 5,338 | 5,123 | ||||||||||||
| Surplus | 47,026 | 50,328 | 42,086 | ||||||||||||
| Retained Earnings | 25,370 | 20,425 | 22,509 | ||||||||||||
| Accumulated Other Comprehensive Income (Loss) | 1,818 | 1,114 | (1,249 | ) | |||||||||||
| Treasury Stock | (464 | ) | (464 | ) | (464 | ) | |||||||||
| TOTAL STOCKHOLDERS’ EQUITY | 96,216 | 93,864 | 85,108 | ||||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,093,768 | $ | 1,072,262 | $ | 940,890 | |||||||||
| END OF PERIOD SHARES OUTSTANDING | 5,342,670 | 5,338,370 | 5,096,447 | ||||||||||||
| TANGIBLE BOOK VALUE PER SHARE | $ | 12.04 | $ | 11.58 | $ | 10.73 | |||||||||
THE FIRST BANCSHARES, INC. Consolidated Statements of Income | ||||||||||||||||
Three Months | Twelve Months | |||||||||||||||
| Dec 31, | Dec 31, | Dec 31, | Dec 31, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
| INTEREST INCOME | ||||||||||||||||
| Interest and Fees on Loans | $ | 8,122 | $ | 6,971 | $ | 30,276 | $ | 25,736 | ||||||||
| Interest and Dividends on Securities | 1,534 | 1,430 | 6,042 | 5,502 | ||||||||||||
| Interest on Fed Funds Sold | 6 | 10 | 53 | 80 | ||||||||||||
| TOTAL INTEREST INCOME | 9,662 | 8,411 | 36,371 | 31,318 | ||||||||||||
| INTEREST EXPENSE | ||||||||||||||||
| Interest on Deposits | 631 | 476 | 2,370 | 2,300 | ||||||||||||
| Interest on Borrowings | 160 | 169 | 603 | 617 | ||||||||||||
| TOTAL INTEREST EXPENSE | 791 | 645 | 2,973 | 2,917 | ||||||||||||
| NET INTEREST INCOME | 8,871 | 7,766 | 33,398 | 28,401 | ||||||||||||
| Provision for Loan Losses | 152 | 59 | 1,418 | 1,079 | ||||||||||||
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 8,719 | 7,707 | 31,980 | 27,322 | ||||||||||||
| NON-INTEREST INCOME | 2,055 | 1,671 | 7,803 | 7,083 | ||||||||||||
| NON-INTEREST EXPENSE | 8,051 | 7,308 | 30,733 | 28,162 | ||||||||||||
| Income before Income Taxes | 2,723 | 2,070 | 9,050 | 6,243 | ||||||||||||
| Income Taxes | 682 | 572 | 2,436 | 1,604 | ||||||||||||
| NET INCOME | 2,041 | 1,498 | 6,614 | 4,639 | ||||||||||||
| Preferred Stock Accretion & Dividends | 86 | 106 | 363 | 424 | ||||||||||||
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ | 1,955 | $ | 1,392 | $ | 6,251 | $ | 4,215 | ||||||||
BASIC EARNINGS PER SHARE | $ | 0.37 | $ | 0.27 | $ | 1.20 | $ | 0.98 | ||||||||
| DILUTED EARNINGS PER SHARE | $ | 0.36 | $ | 0.27 | $ | 1.19 | $ | 0.96 | ||||||||
| WEIGHTED AVG SHARES OUTSTANDING | 5,314,743 | 5,102,644 | 5,227,768 | 4,319,485 | ||||||||||||
| DILUTED WEIGHTED AVG SHS OUTSTANDING | 5,357,644 | 5,156,089 | 5,270,669 | 4,372,930 | ||||||||||||
THE FIRST BANCSHARES, INC. | ||||||||||||||||
Three Months | Twelve Months | |||||||||||||||
| Dec 31, | Dec 31, | Dec 31, | Dec 31, | |||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
| EARNINGS PERFORMANCE RATIOS | ||||||||||||||||
| Annualized Return on Average Assets | 0.76 | % | 0.64 | % | 0.64 | % | 0.49 | % | ||||||||
| Annualized Return on Average Assets(1) | 0.71 | % | 0.65 | % | 0.64 | % | 0.56 | % | ||||||||
| Annualized Return on Average Equity | 9.03 | % | 7.24 | % | 7.49 | % | 5.45 | % | ||||||||
| Annualized Return on Average Equity(1) | 8.39 | % | 7.35 | % | 7.42 | % | 6.23 | % | ||||||||
| Annualized Return on Average TCE | 13.89 | % | 11.47 | % | 11.58 | % | 8.36 | % | ||||||||
| Annualized Return on Average TCE(1) | 12.91 | % | 11.63 | % | 11.47 | % | 9.55 | % | ||||||||
| Efficiency Ratio(2) | 71.94 | % | 75.18 | % | 72.71 | % | 76.98 | % | ||||||||
| Efficiency Ratio(1)(2) | 73.13 | % | 74.87 | % | 72.52 | % | 73.88 | % | ||||||||
Net Overhead Expense to Average Earning Assets(3) | 2.47 | % | 2.63 | % | 2.46 | % | 2.46 | % | ||||||||
Net Overhead Expense to Average Earning Assets(1)(3) | 2.54 | % | 2.62 | % | 2.47 | % | 2.34 | % | ||||||||
| ASSET QUALITY RATIOS | ||||||||||||||||
| Annualized Net Charge-offs to Average Loans | 0.08 | % | 0.00 | % | 0.17 | % | 0.01 | % | ||||||||
| Allowance for Loan Losses to Period End Loans | 0.86 | % | 0.98 | % | ||||||||||||
| Non-performing Assets to Period End Assets | 1.06 | % | 1.09 | % | ||||||||||||
| Non-performing Loans to Period End Loans | 0.95 | % | 0.57 | % | ||||||||||||
| Loans 30-89 Days Past Due to Period End Loans | 1.01 | % | 0.95 | % | ||||||||||||
SELECTED BALANCE SHEET & OTHER FINANCIAL DATA | ||||||||||||||||
| Average Assets | $1,073,287 | $937,584 | $1,030,322 | $941,742 | ||||||||||||
| Average Earning Assets | $972,968 | $857,034 | $931,968 | $857,405 | ||||||||||||
| Average Total Loans | $680,186 | $575,310 | $632,049 | $583,200 | ||||||||||||
| Average Demand Deposits | $197,372 | $121,835 | $184,037 | $116,289 | ||||||||||||
| Average Interest Bearing Liabilities | $774,891 | $720,668 | $746,025 | $728,322 | ||||||||||||
| Average Equity | $90,458 | $82,727 | $88,270 | $85,081 | ||||||||||||
| Period End Non-performing Assets | $11,629 | $10,300 | ||||||||||||||
| Period End Non-performing Loans | $6,725 | $3,340 | ||||||||||||||
| Period End Loans 30-89 Days Past Due | $7,163 | $5,553 | ||||||||||||||
| Tax Equivalent Net Interest Income | $9,137 | $8,050 | $34,465 | $29,502 | ||||||||||||
| Net Charge-offs during Period | $141 | $0 | $1,051 | $75 | ||||||||||||
(1) Excludes merger related costs and one-time items | ||||||||||||||||
(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 | ||||||||||||||||
(3) Net Overhead Expense is defined as Total Non-interest Expense less Total Non-interest income | ||||||||||||||||
Contacts:
M. Ray “Hoppy” Cole, 601-268-8998
Chief
Executive Officer
or
Dee Dee Lowery, 601-268-8998
Chief
Financial Officer
