Exhibit 99.1
FINANCIAL CONTACT: JIM AUSTIN 864-679-9070
MEDIA CONTACT: EDDIE TERRELL 864-679-9016
WEB SITE: www.greenvillefirst.com
Greenville First Reports Record Earnings for the Year 2005
Assets grew to over $400 million
Net income increases 25% to $2.5 million
Greenville, SC, January 17, 2006 - - Greenville First Bancshares, Inc. (NASDAQ: GVBK), holding company for Greenville First Bank NA, today announced that net income for the year ended December 31, 2005 was $2.5 million, or $0.86 per diluted share, a 25% increase when compared to a net income of $2.0 million, or $0.90 per diluted share for the previous year, 2004.
Included in net income for the year ended December 31, 2005 is a non-operating expense of $930 thousand, net of taxes, from a previously reported impairment charge related to the market value on its corporate office building that was purchased by the Company in late 2005. The pre-tax expense was $1.5 million. Excluding the $930 thousand non-operating expense, net operating income was $3.4 million, an increase of $1.4 million or 71.1% from the previous year ended December 31, 2004.
The Company also reported that net operating income for the fourth quarter of 2005 increased 47.0% to $1.0 million. Net income for the fourth quarter was $105 thousand, after taking into account the $930 thousand non-operating expense related to the impairment on the building.
Return on average assets for the year ended December 31, 2005 was 0.70% or 0.96% excluding the impairment charge, compared to 0.73% for the same period in 2004. Return on average equity was 8.44% or 11.56% excluding the impairment charge, compared to 12.37% for the same period in 2004. The decline in return on average equity resulted from a significant increase in capital from the Company's secondary offering in late 2004. The Company's operating efficiency ratio (noninterest expense, excluding the impairment charge on real estate divided by the sum of net interest income and noninterest income) improved to 49.23% during 2005 compared to 51.58% for the year ended December 31, 2004.
"2005 has been a significant year for the Greenville First team. We have increased our presence in the Greenville community with the addition of the Parkway and Augusta Road offices while achieving exceptional financial results", said Art Seaver, President and CEO. "Our asset growth to $405 million and the significant increase in operating earnings is evidence of the strong momentum of our company."
Total assets grew to $405.3 million as of December 31, 2005 compared to $315.8 million at December 31, 2004, or an increase of 28.3%. Loans were $334.0 million at December 31, 2005, an increase of $57.4 million or 20.8% when compared with $276.6 million at December 31, 2004. Deposits grew $49.3 million to $254.1 million at December 31, 2005 compared to $204.9 million at December 31, 2004.
The closing stock price on December 31, 2005 was $24.75 per share.
FORWARD-LOOKING STATEMENTS
This press release contains financial information determined by methods other than in accordance with Generally Accepted Accounting Principles ("GAAP"). The attached financial highlights provide reconciliations between GAAP net income, operating earnings and noninterest expenses (which exclude impairment charges).
Certain statements in this news release contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to future plans and expectations, and are thus prospective. Such forward-looking statements are subject to risks, uncertainties, and other factors, such as a downturn in the economy, which could cause actual results to differ materially from future plans and expectations expressed or implied by such forward-looking statements.
Although we believe that the assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove to differ from actual results. Therefore, we can give no assurance that the results contemplated in the forward-looking statements will be realized. The inclusion of this forward-looking information should not be construed as a representation by our company or any person that future events, plans, or expectations contemplated by our company will be achieved. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
SUMMARY CONSOLIDATED FINANCIAL DATA
Our summary consolidated financial data as of and for the three months and years ended December 31, 2005 and 2004 have not been audited but, in the opinion of our management, contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly our financial position and results of operations for such periods in accordance with generally accepted accounting principles.
| Three Months | | Years |
| Ended December 31, | | Ended December 31, |
| 2005 | 2004 | | 2005 | 2004 |
(In thousands, except per share amounts) | | | | |
| | | | |
Summary Results of Operations Data: | | | | |
Interest income | $ | 6,190 | $ | 4,186 | | $ | 21,670 | $ | 13,965 |
Interest expense | 2,812 | 1,623 | | 9,585 | 5,317 |
Net interest income | 3,378 | 2,563 | | 12,085 | 8,648 |
Provision for loan losses | 165 | 285 | | 1,000 | 1,310 |
Net interest income after | | | | | |
provision for loan losses | 3,213 | 2,278 | | 11,085 | 7,338 |
Noninterest income | 193 | 214 | | 826 | 761 |
Noninterest expense | 3,237 | 1,357 | | 7,856 | 4,852 |
Income before taxes | 169 | 1,135 | | 4,055 | 3,247 |
Income tax expense | 64 | 431 | | 1,541 | 1,234 |
Net income | $ | 105 | $ | 704 | | $ | 2,514 | $ | 2,013 |
| | | | | |
Per Share Data: | | | | | |
Net income, basic | $ | 0.04 | $ | 0.27 | | $ | 0.95 | $ | 1.02 |
Net income, diluted | $ | 0.04 | $ | 0.24 | | $ | 0.86 | $ | 0.90 |
Book value | $ | 11.46 | $ | 10.60 | | $ | 11.46 | $ | 10.60 |
| | | | | |
Weighted Average Number of Shares Outstanding: | | | | | |
Basic | 2,660 | 2,648 | | 2,656 | 1,972 |
Diluted | 2,945 | 2,916 | | 2,930 | 2,240 |
| | | | | |
Performance Ratios: | | | | | |
Return on average assets (1) | | | | | |
GAAP | 0.11 % | 0.90 % | | 0.70 % | 0.73 % |
Operating (4) | 1.10 % | 0.90 % | | 0.96 % | 0.73 % |
| | | | | |
Return on average equity (1) | | | | | |
GAAP | 1.35 % | 10.09 % | | 8.44 % | 12.37 % |
Operating (4) | 13.26 % | 10.09 % | | 11.56 % | 12.37 % |
| | | | | |
Net interest margin (1) | 3.66 % | 3.35 % | | 3.45 % | 3.17 % |
| | | | | |
Efficiency ratio (2) | | | | | |
GAAP | 90.64 % | 48.87 % | | 60.85 % | 51.58 % |
Operating (4) | 48.64 % | 48.87 % | | 49.23 % | 51.58 % |
(Continued)
SUMMARY CONSOLIDATED FINANCIAL DATA, CONTINUED
| | Three Months | | Years |
| | Ended December 31, | | Ended December 31, |
| | 2005 | 2004 | | 2005 | 2004 |
Growth Ratios and Other Data: | | | | | |
Percentage change in net income, (GAAP) | (85.08)% | | | 24.92 % | |
Percentage change in diluted net income, (GAAP) | | | | | |
per share | (83.33)% | | | (4.44)% | |
| | | | | | | | | | | | |
Reconciliation of GAAP to Non-GAAP Measures: | | | | | |
Net income, as reported (GAAP) | $ | 105 | $ | 704 | | $ | 2,514 | $ | 2,013 |
Non-operating items: | | | | | |
Impairment on real estate, net of income tax | 930 | - | | 930 | - |
Operating earnings (net income, excluding non- | | | | | |
operating items) | $ | 1,035 | $ | 704 | | $ | 3,444 | $ | 2,013 |
| | | | | |
Noninterest expense, as reported (GAAP) | $ | 3,237 | $ | 1,357 | | $ | 7,856 | $ | 4,852 |
Non-operating items: | | | | | |
Impairment on real estate | 1,500 | - | | 1,500 | - |
Operating noninterest expense (noninterest expense, | | | | | |
excluding non-operating items) | $ | 1,737 | $ | 1,357 | | $ | 6,356 | $ | 4,852 |
| At December 31, |
| 2005 | 2004 |
Summary Balance Sheet Data: | | |
Assets | $ | 405,313 | $ | 315,811 |
Federal funds sold | 19,381 | 1,394 |
Investment securities | 36,131 | 29,162 |
Loans (3) | 338,530 | 280,347 |
Allowance for loan losses | 4,490 | 3,717 |
Deposits | 254,148 | 204,864 |
Securities sold under agreement to repurchase and federal funds purchased | 14,680 | 13,100 |
Other borrowed funds | 79,500 | 60,660 |
Junior subordinate debentures | 13,403 | 6,186 |
Shareholders' equity | 30,473 | 28,079 |
| | | | |
Asset Quality Ratios: | | |
Nonperforming assets, past due and restructured loans to total loans (3) | 0.14% | 0.27% |
Nonperforming assets, past due and restructured loans to total assets | 0.12% | 0.24% |
Net charge-offs year to date to average total loans (3) | 0.07% | 0.12% |
Allowance for loan losses to nonperforming loans | 962.74% | 502.84% |
Allowance for loan losses to total loans (3) | 1.33% | 1.33% |
| | |
Capital Ratios: | | |
Average equity to average assets | 8.34% | 5.87% |
Leverage ratio | 10.49% | 11.00% |
Tier 1 risk-based capital ratio | 12.20% | 13.40% |
Total risk-based capital ratio | 13.45% | 14.60% |
| | |
Growth Ratios and Other Data: | | |
Percentage change in assets | 28.34% | |
Percentage change in loans (3) | 20.75% | |
Percentage change in deposits | 24.06% | |
Percentage change in equity | 8.53% | |
Loan to deposit ratio (3) | 133.20% | |
(1) Annualized for the three month periods.
(2) Computed by dividing noninterest expense by the sum of net interest income on a tax equivalent basis and noninterest income, net of
securities gains or losses.
(3) Includes nonperforming loans.
