Exhibit 99.1
The First Bancshares, Inc. Reports 2nd Quarter 2014 Earnings and Declaration of Dividend
HATTIESBURG, Miss.--(BUSINESS WIRE)--July 28, 2014--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 June 30, 2014. The First Bancshares, Inc. also announced a quarterly dividend of $.0375 per common share. The record date will be August 7, 2014 with a payable date of August 21, 2014.
Net income available to common stockholders for the three months ended June 30, 2014 amounted to $1,527,000, or $0.29 per diluted share, compared to $706,000, or $0.18 per diluted share for the same quarter in 2013, an increase of 821,000 or 116.3% in net income available to common shareholders. Net income available to common shareholders exclusive of merger related costs and a gain on sale of securities for the three months ended June 30, 2014 was $1,438,000, or $0.27 per diluted share, a 26.8% 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 six months ended June 30, 2014 amounted to $2,848,000, or $0.55 per diluted share, compared to $1,825,000, or $0.51 per diluted share for the same period in 2013, an increase of $1,023,000 or 56.1% in net income available to common shareholders. Net income available to common shareholders exclusive of one-time items for the six months ended June 30, 2014 was $2,748,000, or $0.53 per diluted share, a 24.9% increase in net income available to common shareholders over the same period in 2013 adjusted for merger related costs.
M. Ray “Hoppy” Cole, President & Chief Executive Officer, commented, “Our company reached a milestone in the accomplishment of our strategic plan ending the quarter with over $1 billion in total assets. The company posted significant increases in loans and deposits which produced improved profitability and operating results. We are encouraged by the growth opportunities that lie ahead for our company in both our legacy and newly established markets.”
Balance Sheet Highlights
Total assets for the Company totaled $1.0 billion at June 30, 2014, an increase of $20.7 million compared with March 31, 2014. The increase during the second quarter of 2014 was attributable to an increase in the Company’s deposit balances.
June 30, 2014 loans outstanding increased by $16.5 million, or approximately 11.1% on an annualized basis, compared with March 31, 2014, and increased $52.3 million, or 9.4%, compared to June 30, 2013 total loans outstanding.
End of Period Loan Balances | 06/30/14 | 03/31/14 | 06/30/13 | ||||||||||
| (dollars in thousands) | |||||||||||||
| Loans held for sale | $ | 3,220 | $ | 2,586 | $ | 2,933 | |||||||
| Commercial | 81,958 | 84,898 | 69,376 | ||||||||||
| Real Estate: | |||||||||||||
| Mortgage-commercial | 204,101 | 198,984 | 186,219 | ||||||||||
| Mortgage-residential | 230,310 | 218,901 | 210,543 | ||||||||||
| Construction | 74,105 | 73,523 | 72,349 | ||||||||||
| Consumer and other | 16,337 | 14,641 | 16,351 | ||||||||||
| $ | 610,031 | $ | 593,533 | $ | 557,771 | ||||||||
Non-performing assets totaled $13.3 million at June 30, 2014 compared to $9.9 million of non-performing assets at March 31, 2014 and $9.9 million at June 30, 2013. Non-performing assets represented 1.32% of total assets at June 30, 2014 compared to 1.00% of total assets at March 31, 2014, and compared to 1.02% at June 30, 2013. Non-performing loans totaled $6.5 million at June 30, 2014 compared to $2.7 million at March 31, 2014 and compared to $2.2 million of non-performing loans at June 30, 2013. Non-performing loans represented 1.07% of total loans at June 30, 2014 compared with 0.46% of total outstanding loans at March 31, 2014 and 0.40% of total loans outstanding at June 30, 2013. The increase in non-performing assets is due to placing one loan relationship on non-accrual that was previously classified substandard since 2009.
Non-Performing Assets | 06/30/14 | 03/31/14 | 06/30/13 | ||||||||||
| (dollars in thousands) | |||||||||||||
| Non-Accrual Loans | $ | 6,063 | $ | 2,267 | $ | 1,886 | |||||||
| Past Due Loans (90 days or more) | 447 | 443 | 352 | ||||||||||
| Total Non-Performing Loans | 6,510 | 2,710 | 2,238 | ||||||||||
| Non-Accrual Securities | 1,950 | 1,950 | 1,950 | ||||||||||
| Other Real Estate | 4,875 | 5,221 | 5,686 | ||||||||||
| Total Non-Performing Assets | $ | 13,335 | $ | 9,881 | $ | 9,874 | |||||||
The Company’s allowance for loan losses totaled $6.0 million at June 30, 2014 representing an increase of $188,000, or 12.94% on an annualized basis, from March 31, 2014 and an increase of $606,000, or 11.24%, from June 30, 2013. The allowance for loan losses represented 0.98% of period-end loans at June 30, 2014 compared with 0.98% of period-end loans at March 31, 2014 and 0.97% of period-end loans at June 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 1.16% of period end loans excluding those booked at fair value at June 30, 2014 compared with 1.20% at March 31, 2014 and 1.26% at June 30, 2013.
Total deposits increased $20.3 million or 9.40% on an annualized basis, as of June 30, 2014 compared with March 31, 2014 total deposits and increased by approximately $40.5 million or 4.81% compared with June 30, 2013.
End of Period Deposit Balances | 06/30/14 | 03/31/14 | 06/30/13 | ||||||||||
| (dollars in thousands) | |||||||||||||
| Non-interest-bearing Demand Deposits | $ | 183,226 | $ | 179,334 | $ | 167,246 | |||||||
| IB Demand, Savings, and MMDA Accounts | 498,527 | 476,958 | 454,172 | ||||||||||
| Time Deposits < $100,000 | 80,144 | 82,780 | 96,841 | ||||||||||
| Time Deposits > $100,000 | 121,975 | 124,509 | 125,080 | ||||||||||
| $ | 883,872 | $ | 863,581 | $ | 843,339 | ||||||||
Results of Operations Highlights – Quarter ended June 30, 2014
Net income available to common stockholders for the quarter ended June 30, 2014 totaled $1,527,000 or $0.29 per diluted share, an increase of $206,000 or 15.59% from the first quarter of 2014 net income available to common stockholders of $1,321,000 or $0.25 per diluted share.
During the quarter ended June 30, 2014, net interest income totaled $7,848,000 representing an increase of $1,062,000, or 15.6%, compared with the quarter ended June 30, 2013 net interest income of $6,786,000. The tax equivalent net interest margin for the quarter ended June 30, 2014 was 3.52% compared to 3.29% in the second quarter of 2013. The increase in net interest income and the net interest margin during the quarter ended June 30, 2014 compared with the second 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 second quarter of 2014 and 9 basis points in the second quarter of 2013.
During the quarter ended June 30, 2014, non-interest income totaled $2,055,000, an increase of $383,000 or 22.9%, compared with the quarter ended March 31, 2014, and an increase of $165,000, or 8.7%, compared with the second quarter of 2013. The increase for the quarter ended June 30, 2014 is attributed primarily to a gain of $254,000 from the sale of other investments.
Quarter | Quarter | Quarter | |||||||||||
Non-interest Income | 06/30/14 | 03/31/14 | 06/30/13 | ||||||||||
| (dollars in thousands) | |||||||||||||
| Service Charges on Deposit Accounts | $ | 594 | $ | 561 | $ | 601 | |||||||
| Mortgage Income | 407 | 349 | 613 | ||||||||||
| Interchange Fee Income | 507 | 472 | 460 | ||||||||||
| Other Operating Income | 547 | 290 | 216 | ||||||||||
Total Non-interest Income | $ | 2,055 | $ | 1,672 | $ | 1,890 | |||||||
During the quarter ended June 30, 2014, non-interest expense totaled $7,384,000, an increase of $157,000, or 2.17%, compared with the quarter ended March 30, 2014, and an increase of $139,000, or 1.92%, compared with the second quarter of 2013.
Quarter | Quarter | Quarter | |||||||||||
Non-interest Expense | 06/30/14 | 03/31/14 | 06/30/13 | ||||||||||
(dollars in thousands) | |||||||||||||
| Salaries and Employee Benefits | $ | 4,260 | $ | 4,097 | $ | 3,729 | |||||||
| Occupancy, Furniture and Equipment Expense | 1,093 | 1,068 | 940 | ||||||||||
| FDIC Premiums | 222 | 223 | 168 | ||||||||||
| Professional Fees | 456 | 389 | 911 | ||||||||||
| Advertising and Promotion | 87 | 53 | 109 | ||||||||||
| Intangible Amortization | 94 | 94 | 89 | ||||||||||
| Other Operating Expenses | 1,172 | 1,303 | 1,299 | ||||||||||
| Total Non-interest Expense | $ | 7,384 | $ | 7,227 | $ | 7,245 | |||||||
Total non-interest expense increases in salaries due to the expansion into Baton Rouge and the acquisition of First National Bank of Baldwin County were mostly offset by the decrease in professional fees. Acquisition costs for First National Bank of Baldwin County of $447,000 were expensed during the second quarter of 2013 which were larger than the acquisition costs for Bay Bank of $128,000 that were expensed during the second quarter of 2014 which resulted in an overall decrease in professional fees.
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. | ||||||||||||||||
| (unaudited, dollars in thousands except per shares data) | ||||||||||||||||
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Consolidated Balance Sheets | ||||||||||||||||
June 30, | Mar 31, | June 30, | ||||||||||||||
| ASSETS | ||||||||||||||||
| Cash and Due from Banks | $ | 25,677 | $ | 28,514 | $ | 27,811 | ||||||||||
| Federal funds sold | 2,477 | 22,261 | 4,941 | |||||||||||||
| Interest-bearing deposits with banks | 27,289 | 31,203 | 49,089 | |||||||||||||
| Investment Securities | 276,099 | 251,037 | 260,586 | |||||||||||||
| Loans held for sale | 3,220 | 2,586 | 2,933 | |||||||||||||
| Loans, Net of Unearned Income | 606,812 | 590,947 | 554,838 | |||||||||||||
| Allowance for Loan Losses | (5,999 | ) | (5,811 | ) | (5,393 | ) | ||||||||||
| Net Loans | 600,813 | 585,136 | 549,445 | |||||||||||||
| Premises and Equipment | 31,339 | 31,416 | 32,696 | |||||||||||||
| Other Real Estate Owned | 4,875 | 5,221 | 5,687 | |||||||||||||
| Goodwill | 10,621 | 10,621 | 10,713 | |||||||||||||
| Other Assets | 26,879 | 20,572 | 21,536 | |||||||||||||
| TOTAL ASSETS | $ | 1,009,289 | $ | 988,567 | $ | 965,437 | ||||||||||
| LIABILITIES | ||||||||||||||||
| Non-interest-bearing Demand Deposits | $ | 183,226 | $ | 179,334 | $ | 167,246 | ||||||||||
| Interest-bearing Accounts | 498,527 | 476,958 | 454,172 | |||||||||||||
| Time Deposits | 202,119 | 207,289 | 221,921 | |||||||||||||
| Total Deposits | 883,872 | 863,581 | 843,339 | |||||||||||||
| Borrowings | 13,500 | 15,000 | 16,500 | |||||||||||||
| Subordinated Debentures | 10,310 | 10,310 | 10,310 | |||||||||||||
| Other Liabilities | 11,830 | 12,180 | 12,671 | |||||||||||||
| TOTAL LIABILITIES | 919,512 | 901,071 | 882,820 | |||||||||||||
| STOCKHOLDER’S EQUITY | ||||||||||||||||
| Preferred Stock | 17,123 | 17,123 | 17,062 | |||||||||||||
| Common Stock | 5,180 | 5,176 | 5,120 | |||||||||||||
| Surplus | 42,239 | 42,107 | 41,902 | |||||||||||||
| Retained Earnings | 24,972 | 23,637 | 20,538 | |||||||||||||
| Accumulated Other Comprehensive Income (Loss) | 727 | (83 | ) | (1,541 | ) | |||||||||||
| Treasury Stock | (464 | ) | (464 | ) | (464 | ) | ||||||||||
| TOTAL STOCKHOLDERS’ EQUITY | 89,777 | 87,496 | 82,617 | |||||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,009,289 | $ | 988,567 | $ | 965,437 | ||||||||||
| END OF PERIOD SHARES OUTSTANDING | 5,180,287 | 5,175,774 | 5,119,949 | |||||||||||||
| TANGIBLE BOOK VALUE PER SHARE | $ | 11.49 | $ | 11.05 | $ | 10.15 | ||||||||||
| THE FIRST BANCSHARES, INC. | |||||||||||||||||
| (unaudited, dollars in thousands except per share data) | |||||||||||||||||
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Consolidated Statements of Income | |||||||||||||||||
Three Months | Six Months | ||||||||||||||||
June 30, | June 30, | June 30, | June 30, | ||||||||||||||
| INTEREST INCOME | |||||||||||||||||
| Interest and Fees on Loans | $ | 7,091 | $ | 6,318 | $ | 14,095 | $ | 11,549 | |||||||||
| Interest and Dividends on Securities | 1,453 | 1,269 | 2,885 | 2,676 | |||||||||||||
| Interest on Fed Funds Sold | 30 | 22 | 41 | 34 | |||||||||||||
| TOTAL INTEREST INCOME | 8,574 | 7,609 | 17,021 | 14,259 | |||||||||||||
| INTEREST EXPENSE | |||||||||||||||||
| Interest on Deposits | 584 | 666 | 1,050 | 1,284 | |||||||||||||
| Interest on Borrowings | 142 | 157 | 299 | 298 | |||||||||||||
| TOTAL INTEREST EXPENSE | 726 | 823 | 1,349 | 1,582 | |||||||||||||
| NET INTEREST INCOME | 7,848 | 6,786 | 15,672 | 12,677 | |||||||||||||
| Provision for Loan Losses | 277 | 349 | 635 | 660 | |||||||||||||
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES | 7,571 | 6,437 | 15,037 | 12,017 | |||||||||||||
| NON-INTEREST INCOME | 2,055 | 1,890 | 3,727 | 3,820 | |||||||||||||
| NON-INTEREST EXPENSE | 7,384 | 7,245 | 14,611 | 13,224 | |||||||||||||
| Income before Income Taxes | 2,242 | 1,082 | 4,153 | 2,613 | |||||||||||||
| Income Taxes | 629 | 270 | 1,113 | 576 | |||||||||||||
| NET INCOME | 1,613 | 812 | 3,040 | 2,037 | |||||||||||||
| Preferred Stock Accretion & Dividends | 86 | 106 | 192 | 212 | |||||||||||||
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ | 1,527 | $ | 706 | $ | 2,848 | $ | 1,825 | |||||||||
| BASIC EARNINGS PER SHARE | $ | 0.30 | $ | 0.18 | $ | 0.55 | $ | 0.52 | |||||||||
| DILUTED EARNINGS PER SHARE | $ | 0.29 | $ | 0.18 | $ | 0.55 | $ | 0.51 | |||||||||
| WEIGHTED AVG SHARES OUTSTANDING | 5,152,784 | 3,955,243 | 5,142,227 | 3,536,362 | |||||||||||||
| DILUTED WEIGHTED AVG SHS OUTSTANDING | 5,180,019 | 4,001,481 | 5,190,576 | 3,582,600 | |||||||||||||
| THE FIRST BANCSHARES, INC. | |||||||||||||||||||||
| (unaudited, dollars in thousands except per share data) | |||||||||||||||||||||
Three Months | Six Months | ||||||||||||||||||||
June 30, | June 30, | June 30, | June 30, | ||||||||||||||||||
| EARNINGS PERFORMANCE RATIOS | |||||||||||||||||||||
| Annualized Return on Average Assets | 0.64 | % | 0.36 | % | 0.61 | % | 0.49 | % | |||||||||||||
| Annualized Return on Average Assets(1) | 0.60 | % | 0.55 | % | 0.59 | % | 0.58 | % | |||||||||||||
| Annualized Return on Average Equity | 7.38 | % | 3.80 | % | 7.03 | % | 5.26 | % | |||||||||||||
| Annualized Return on Average Equity(1) | 6.97 | % | 5.80 | % | 6.79 | % | 6.22 | % | |||||||||||||
| Net Interest Margin | 3.52 | % | 3.29 | % | 3.62 | % | 3.49 | % | |||||||||||||
| Efficiency Ratio(2) | 72.68 | % | 80.96 | % | 73.32 | % | 77.66 | % | |||||||||||||
| Efficiency Ratio(1)(2) | 73.26 | % | 73.85 | % | 73.47 | % | 73.71 | % | |||||||||||||
Net Overhead Expense to Average Earning Assets(3) | 2.32 | % | 2.50 | % | 2.43 | % | 2.48 | % | |||||||||||||
Net Overhead Expense to Average Earning Assets(1)(3) | 2.37 | % | 2.20 | % | 2.46 | % | 2.33 | % | |||||||||||||
| ASSET QUALITY RATIOS | |||||||||||||||||||||
| Annualized Net Charge-offs to Average Loans | 0.06 | % | (0.09 | %) | 0.12 | % | (0.002 | %) | |||||||||||||
| Allowance for Loan Losses to Period End Loans | 0.98 | % | 0.97 | % |
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| Non-performing Assets to Period End Assets | 1.32 | % | 1.02 | % | |||||||||||||||||
| Non-performing Loans to Period End Loans | 1.07 | % | 0.40 | % | |||||||||||||||||
| Loans 30-89 Days Past Due to Period End Loans | 0.71 | % | 0.80 | % | |||||||||||||||||
SELECTED BALANCE SHEET & OTHER FINANCIAL DATA | |||||||||||||||||||||
| Average Assets | $ | 1,015,679 | $ | 908,495 | $ | 990,327 | $ | 827,238 | |||||||||||||
| Average Earning Assets | $ | 919,716 | $ | 857,731 | $ | 895,064 | $ | 757,751 | |||||||||||||
| Average Total Loans | $ | 600,114 | $ | 556,121 | $ | 595,697 | $ | 484,857 | |||||||||||||
| Average Demand Deposits | $ | 178,137 | $ | 150,232 | $ | 172,861 | $ | 132,742 | |||||||||||||
| Average Interest Bearing Liabilities | $ | 738,546 | $ | 707,968 | $ | 719,811 | $ | 640,573 | |||||||||||||
| Average Equity | $ | 87,480 | $ | 85,584 | $ | 86,546 | $ | 77,500 | |||||||||||||
| Period End Non-performing Assets | $ | 13,335 | $ | 9,874 | |||||||||||||||||
| Period End Non-performing Loans | $ | 6,510 | $ | 2,238 | |||||||||||||||||
| Period End Loans 30-89 Days Past Due | $ | 4,322 | $ | 4,446 | |||||||||||||||||
| Tax Equivalent Net Interest Income | $ | 8,104 | $ | 7,059 | $ | 16,200 | $ | 13,209 | |||||||||||||
| Net Charge-offs (Recoveries) during Period | $ | 89 | $ | (126 | ) | $ | 364 | $ | (6 | ) | |||||||||||
| (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 | |||||||||||||||||||||
CONTACT:
The First Bancshares, Inc.
M. Ray “Hoppy” Cole
Chief Executive Officer
or
Dee Dee Lowery, 601-268-8998
Chief Financial Officer