UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 27, 2018 (July 24, 2018)
PEOPLES BANCORP INC. | ||
(Exact name of Registrant as specified in its charter) | ||
Ohio | 0-16772 | 31-0987416 | ||
(State or other jurisdiction | (Commission File | (I.R.S. Employer | ||
of incorporation) | Number) | Identification Number) | ||
138 Putnam Street, PO Box 738 | ||||
Marietta, Ohio | 45750-0738 | |||
(Address of principal executive offices) | (Zip Code) | |||
Registrant's telephone number, including area code: | (740) 373-3155 | |||
Not applicable | ||
(Former name or former address, if changed since last report) | ||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act | |
(17 CFR 240.14d-2(b)) | ||
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act | |
(17 CFR 240.13e-4(c)) | ||
Item 2.02 Results of Operations and Financial Condition
On July 24, 2018, management of Peoples Bancorp Inc. (“Peoples”) conducted a facilitated conference call at approximately 11:00 a.m., Eastern Daylight Saving Time, to discuss results of operations for the quarter and six months ended June 30, 2018. A replay of the conference call audio will be available on Peoples’ website, www.peoplesbancorp.com, in the “Investor Relations” section for one year. A copy of the transcript of the conference call is included as Exhibit 99.1 to this Current Report on Form 8-K.
The information contained in this Item 2.02 and Exhibit 99.1 included with this Current Report on Form 8-K, is being furnished pursuant to Item 2.02 and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as otherwise stated in such filing.
During the conference call, management referred to non-Generally Accepted Accounting Principles ("GAAP") financial measures that are used by management to provide information useful to investors in understanding Peoples' operating performance and trends, and to facilitate comparisons with the performance of Peoples' peers. The following tables show the differences between the non-GAAP financial measures referred to during the conference call and the most directly comparable GAAP-based financial measures.
NON-GAAP FINANCIAL MEASURES (Unaudited)
The following non-GAAP financial measures used by Peoples provide information useful to investors in understanding Peoples' operating performance and trends, and facilitate comparisons with the performance of Peoples' peers. The following tables summarize the non-GAAP financial measures derived from amounts reported in Peoples' consolidated financial statements:
Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | ||||||||||||||||
(Dollars in thousands) | 2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||
Core Non-interest Expense: | |||||||||||||||||||
Total non-interest expense | $ | 35,971 | $ | 28,221 | $ | 26,680 | $ | 64,192 | $ | 54,011 | |||||||||
Less: Acquisition-related expenses | 6,056 | 149 | — | 6,205 | — | ||||||||||||||
Core non-interest expense | $ | 29,915 | $ | 28,072 | $ | 26,680 | $ | 57,987 | $ | 54,011 | |||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | ||||||||||||||||
(Dollars in thousands) | 2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||
Efficiency Ratio: | |||||||||||||||||||
Total non-interest expense | $ | 35,971 | $ | 28,221 | $ | 26,680 | $ | 64,192 | $ | 54,011 | |||||||||
Less: Amortization of intangible assets | 861 | 754 | 871 | 1,615 | 1,734 | ||||||||||||||
Adjusted non-interest expense | $ | 35,110 | $ | 27,467 | $ | 25,809 | $ | 62,577 | $ | 52,277 | |||||||||
Total fee-based income | $ | 13,807 | $ | 14,894 | $ | 13,590 | 28,701 | 26,924 | |||||||||||
Net interest income | $ | 32,808 | $ | 29,359 | $ | 28,090 | $ | 62,167 | $ | 55,035 | |||||||||
Add: Fully tax-equivalent adjustment (a) | 223 | 227 | 496 | 450 | 1,009 | ||||||||||||||
Net interest income on a fully tax-equivalent basis | $ | 33,031 | $ | 29,586 | $ | 28,586 | $ | 62,617 | $ | 56,044 | |||||||||
Adjusted revenue | $ | 46,838 | $ | 44,480 | $ | 42,176 | $ | 91,318 | $ | 82,968 | |||||||||
Efficiency ratio | 74.96 | % | 61.75 | % | 61.19 | % | 68.53 | % | 63.01 | % | |||||||||
Efficiency Ratio Adjusted for Non-core Items: | |||||||||||||||||||
Core non-interest expense | $ | 29,915 | $ | 28,072 | $ | 26,680 | $ | 57,987 | $ | 54,011 | |||||||||
Less: Amortization of intangible assets | 861 | 754 | 871 | 1,615 | 1,734 | ||||||||||||||
Adjusted core non-interest expense | $ | 29,054 | $ | 27,318 | $ | 25,809 | $ | 56,372 | $ | 52,277 | |||||||||
Adjusted revenue | $ | 46,838 | $ | 44,480 | $ | 42,176 | $ | 91,318 | $ | 82,968 | |||||||||
Efficiency ratio adjusted for non-core items | 62.03 | % | 61.42 | % | 61.19 | % | 61.73 | % | 63.01 | % | |||||||||
June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||||
(Dollars in thousands) | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||||||
Tangible Equity: | |||||||||||||||||||
Total stockholders' equity | $ | 499,339 | $ | 456,815 | $ | 458,592 | $ | 457,386 | $ | 451,353 | |||||||||
Less: goodwill and other intangible assets | 163,953 | 143,820 | 144,576 | 143,859 | 144,692 | ||||||||||||||
Tangible equity | $ | 335,386 | $ | 312,995 | $ | 314,016 | $ | 313,527 | $ | 306,661 | |||||||||
Tangible Assets: | |||||||||||||||||||
Total assets | $ | 3,972,091 | $ | 3,634,929 | $ | 3,581,686 | $ | 3,552,412 | $ | 3,525,126 | |||||||||
Less: goodwill and other intangible assets | 163,953 | 143,820 | 144,576 | 143,859 | 144,692 | ||||||||||||||
Tangible assets | $ | 3,808,138 | $ | 3,491,109 | $ | 3,437,110 | $ | 3,408,553 | $ | 3,380,434 | |||||||||
Tangible Book Value per Common Share: | |||||||||||||||||||
Tangible equity | $ | 335,386 | $ | 312,995 | $ | 314,016 | $ | 313,527 | $ | 306,661 | |||||||||
Common shares outstanding | 19,528,952 | 18,365,035 | 18,287,449 | 18,281,194 | 18,279,036 | ||||||||||||||
Tangible book value per common share | $ | 17.17 | $ | 17.04 | $ | 17.17 | $ | 17.15 | $ | 16.78 | |||||||||
Tangible Equity to Tangible Assets Ratio: | |||||||||||||||||||
Tangible equity | $ | 335,386 | $ | 312,995 | $ | 314,016 | $ | 313,527 | $ | 306,661 | |||||||||
Tangible assets | $ | 3,808,138 | $ | 3,491,109 | $ | 3,437,110 | $ | 3,408,553 | $ | 3,380,434 | |||||||||
Tangible equity to tangible assets | 8.81 | % | 8.97 | % | 9.14 | % | 9.20 | % | 9.07 | % | |||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | ||||||||||||||||
(Dollars in thousands) | 2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||
Pre-Provision Net Revenue: | |||||||||||||||||||
Income before income taxes | $ | 8,904 | $ | 14,124 | $ | 14,180 | $ | 23,028 | $ | 26,841 | |||||||||
Add: provision for loan losses | 1,188 | 1,983 | 947 | 3,171 | 1,571 | ||||||||||||||
Add: loss on debt extinguishment | 13 | — | — | 13 | — | ||||||||||||||
Add: net loss on OREO | — | 5 | 24 | — | 24 | ||||||||||||||
Add: net loss on investment securities | 147 | — | — | 146 | — | ||||||||||||||
Add: net loss on other assets | 330 | — | — | 251 | — | ||||||||||||||
Add: net loss on other transactions | 76 | — | — | 76 | — | ||||||||||||||
Less: net gain on OREO | 14 | — | — | 9 | — | ||||||||||||||
Less: net gain on investment securities | — | 1 | 18 | — | 358 | ||||||||||||||
Less: net gain on other assets | — | 79 | 133 | — | 130 | ||||||||||||||
Pre-provision net revenue | $ | 10,644 | $ | 16,032 | $ | 15,000 | $ | 26,676 | $ | 27,948 | |||||||||
Pre-provision net revenue | $ | 10,644 | $ | 16,032 | $ | 15,000 | $ | 26,676 | $ | 27,948 | |||||||||
Total average assets | $ | 3,897,957 | $ | 3,597,043 | $ | 3,489,701 | $ | 3,748,331 | $ | 3,468,146 | |||||||||
Pre-provision net revenue to total average assets (annualized) | 1.10 | % | 1.81 | % | 1.72 | % | 1.44 | % | 1.63 | % | |||||||||
At or For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||
June 30, | March 31, | June 30, | June 30, | ||||||||||||||||
(Dollars in thousands) | 2018 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||
Annualized Net Income Excluding Amortization of Other Intangible Assets: | |||||||||||||||||||
Net income | $ | 7,892 | $ | 11,741 | $ | 9,766 | $ | 19,633 | $ | 18,575 | |||||||||
Add: amortization of other intangible assets | 861 | 754 | 871 | 1,615 | 1,734 | ||||||||||||||
Less: tax effect (a) of amortization of other intangible assets | 181 | 158 | 305 | 339 | 607 | ||||||||||||||
Net income excluding amortization of other intangible assets | $ | 8,572 | $ | 12,337 | $ | 10,332 | $ | 20,909 | $ | 19,702 | |||||||||
Days in the period | 91 | 90 | 91 | 181 | 181 | ||||||||||||||
Days in the year | 365 | 365 | 365 | 365 | 365 | ||||||||||||||
Annualized net income | $ | 31,655 | $ | 47,616 | $ | 39,171 | $ | 39,591 | $ | 37,458 | |||||||||
Annualized net income excluding amortization of other intangible assets | $ | 34,382 | $ | 50,033 | $ | 41,442 | $ | 42,165 | $ | 39,731 | |||||||||
Average Tangible Stockholders' Equity: | |||||||||||||||||||
Total average stockholders' equity | $ | 489,876 | $ | 454,232 | $ | 447,399 | $ | 472,152 | $ | 443,218 | |||||||||
Less: average goodwill and other intangible assets | 161,600 | 144,190 | 145,052 | 152,943 | 145,298 | ||||||||||||||
Average tangible stockholders' equity | $ | 328,276 | $ | 310,042 | $ | 302,347 | $ | 319,209 | $ | 297,920 | |||||||||
Return on Average Stockholders' Equity Ratio: | |||||||||||||||||||
Annualized net income | $ | 31,655 | $ | 47,616 | $ | 39,171 | $ | 39,591 | $ | 37,458 | |||||||||
Average stockholders' equity | $ | 489,876 | $ | 454,232 | $ | 447,399 | $ | 472,152 | $ | 443,218 | |||||||||
Return on average stockholders' equity | 6.46 | % | 10.48 | % | 8.76 | % | 8.39 | % | 8.45 | % | |||||||||
Return on Average Tangible Stockholders' Equity Ratio: | |||||||||||||||||||
Annualized net income excluding amortization of other intangible assets | $ | 34,382 | $ | 50,033 | $ | 41,442 | $ | 42,165 | $ | 39,731 | |||||||||
Average tangible stockholders' equity | $ | 328,276 | $ | 310,042 | $ | 302,347 | $ | 319,209 | $ | 297,920 | |||||||||
Return on average tangible stockholders' equity | 10.47 | % | 16.14 | % | 13.71 | % | 13.21 | % | 13.34 | % | |||||||||
(a) Tax effect is calculated using a 21% federal statutory corporate income tax rate for the 2018 periods and a 35% federal statutory corporate income tax rate for the 2017 periods.
Item 7.01 Regulation FD Disclosure
From time-to-time between July 30, 2018 and September 30, 2018, the management team of Peoples Bancorp Inc. ("Peoples"), including the Executive Vice President, Chief Financial Officer and Treasurer, and the Executive Vice President, Chief Commercial Banking Officer, intend to conduct one or more meetings with investors and analysts. These individuals intend to use an investor presentation containing financial data and other information regarding Peoples to assist the investors and analysts with their understanding of the business and financial performance of Peoples. A copy of the investor presentation is included as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference.
Within the investor presentation, Peoples updated one of the expectations for the third and fourth quarter of 2018, which were previously disclosed in the July 24, 2018 conference call held to announce second quarter 2018 earnings. Quarterly fee-based revenue is expected to be between $13.5 and $14.5 million per quarter for the third and fourth quarter of 2018, instead of the previously disclosed amount of $13 to $14 million.
The information in this Current Report on Form 8-K is being furnished under Item 7.01 and shall not be deemed "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act"), or otherwise subject to the liabilities of such section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits
a) - c)
Not applicable.
d) Exhibits
See Index to Exhibits below.
EXHIBITS
* Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedules or exhibits will be furnished supplementally to the SEC upon its request.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
PEOPLES BANCORP INC. | ||||
Date: | July 27, 2018 | By:/s/ | JOHN C. ROGERS | |
John C. Rogers | ||||
Executive Vice President, Chief Financial Officer and Treasurer | ||||