NEWS ANNOUNCEMENT
Date: April 28, 2004
Contact: Susan J. Cooke
To: News Media
Release Date: Immediate
COASTAL FINANCIAL CORPORATION
ANNOUNCES FISCAL 2004 SECOND QUARTER EARNINGS
Myrtle Beach, South Carolina, (April 28, 2004) . . . Coastal Financial
Corporation (Nasdaq/CFCP) today announced earnings for the second fiscal quarter
ended March 31, 2004.
Net income for the second quarter of fiscal 2004 increased 33.5% to $3.7 million
or $0.26 per share ($0.24 per share diluted), as compared to $2.8 million or
$0.19 per share ($0.19 per share diluted) for the same period of fiscal 2003.
Net income for the first two quarters of fiscal 2004 increased 27.1% to $7.0
million or $0.49 per share ($0.46 per share diluted), compared to $5.5 million
or $0.39 per share ($0.37 per share diluted) for the same period of fiscal 2003.
At March 31, 2004, assets totaled $1.26 billion, an increase of 18.0% from $1.07
billion at March 31, 2003. During the same period, deposits increased 3.8%, from
$671.2 million to $696.9 million, and loans receivable increased 20.2%, from
$636.8 million to $765.6 million. In comparing the second quarters of fiscal
2003 and 2004, net interest income after provision for loan losses grew 18.9% to
$9.8 million. Returns on average assets and average equity were 1.14% and
18.17%, respectively, for the six months ended March 31, 2004, as compared to
1.08% and 15.97% for the comparable period in fiscal 2003.
At March 31, 2004, non-performing assets to total assets was 0.58% as compared
with 0.67% at March 31, 2003.
-MORE-
Michael C. Gerald, President and Chief Executive Officer of Coastal Financial
Corporation, said, "We are very pleased with the continued earnings momentum of
Coastal Financial Corporation for the first two quarters of fiscal 2004. This
continued level of operating performance reflects well on our Commitment to our
Customers and Communities, and to our steadfast dedication to our QUEST FOR
EXCELLENCE Operating Philosophy."
"During the second quarter of fiscal 2004, we announced a 20.7% increase in
fiscal 2004 first quarter net income, a ten percent stock dividend payable March
24, 2004 to Shareholders of record March 10, 2004, and a $.05 per share cash
dividend payable April 23, 2004 to Shareholders of record April 9, 2004. Other
notable events included national recognition of Coastal Financial Corporation in
the March 2004 edition of THRIFTINVESTOR Magazine. This issue featured an
article which listed the Top 10 Mutual Thrift Conversion IPOs since January 1,
1990. This publication ranked Coastal Financial Corporation #1 in the nation
with a total return since IPO of 5,394% based upon data available at February
27, 2004. These activities are indicative of the continued growth and progress
envisioned under our Vision 2005 Plan, and are an outgrowth of our QUEST FOR
EXCELLENCE Operating Philosophy," concluded Mr. Gerald.
Coastal Financial Corporation, headquartered in Myrtle Beach, South Carolina,
offers a broad range of commercial, consumer and mortgage financial services
through two subsidiaries, Coastal Federal Bank and Coastal Retirement, Estate
and Tax Planners, Inc. Coastal Federal Bank, with assets over $1.2 billion, is a
federally chartered and FDIC insured community bank with eighteen offices
serving the communities of Horry and Georgetown Counties, South Carolina and
Brunswick and New Hanover Counties, North Carolina. Coastal Retirement, Estate
and Tax Planners offers professional, objective, fee-based financial planning
services. Additional information about Coastal Federal is available on its web
site at www.coastalfederal.com.
----------------------
Stock Trading Information
The common stock of Coastal Financial Corporation is traded on the Nasdaq Stock
Market under the symbol "CFCP." For information, contact Raymond James Financial
Services at 1-843-918-7600, Herzog, Heine, Geduld, Inc. at 1-800-523-4936,
Knight Securities at 212-336-8690, Spear, Leeds & Kellogg at 1-800-526-3160 or
Trident Securities at 1-800-222-2618.
-MORE-
Dividend Reinvestment and Direct Stock Purchase Plan
Coastal Financial Corporation offers Shareholders a Dividend Reinvestment and
Direct Stock Purchase Plan which provides existing and new Shareholders a
convenient means for making purchases of Coastal Financial shares free of fees
and brokerage commissions and at a discount to market price. Additional cash
contributions, up to $1,000 per quarter, can be made to purchase additional
shares. For more information, contact the Transfer Agent at 1-800-866-1340, Ext.
2514, or Investor Relations.
Shareholder Services
Shareholders desiring to enroll in the Coastal Financial Corporation Dividend
Reinvestment Plan, change the name, address, or ownership of their stock
certificates, report lost or stolen certificates, or to consolidate accounts
should contact the Transfer Agent at 1-800-866-1340, Ext. 2514, or Investor
Relations.
Investor Relations
Analysts, investors and others seeking financial information should contact:
Susan J. Cooke - Senior Vice President and Secretary
Coastal Financial Corporation
2619 Oak Street
Myrtle Beach, South Carolina 29577
(843) 205-2676
Forward Looking Statements and Related Matters
This news release may contain certain "forward-looking statements" within the
meaning of Section 27A of the Securities Exchange Act of 1934, as amended, that
represent Coastal Financial Corporation's (the "Company") expectations or
beliefs concerning future events. Such forward-looking statements are about
matters that are inherently subject to risks and uncertainties. Factors that
could influence the matters discussed in certain forward-looking statements
include the timing and amount of revenues that may be recognized by the Company,
continuation of current revenue and expense trends (including trends affecting
charge-offs), absence of unforeseen changes in the Company's markets, legal and
regulatory changes, and general changes in the economy (particularly in the
markets served by the Company). Because of the risks and uncertainties inherent
in forward looking statements, readers are cautioned not to place undue reliance
on them, whether included in this news release or made elsewhere from time to
time by the
Company or on its behalf. Except as may be required by applicable law or
regulation, the Company disclaims any obligation to update such forward-looking
statements.
References in this news release to the historical performance of the Company's
stock price may not be indicative of future stock price performance.
#####
COASTAL FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited - Dollars in Thousands Except Per Share Data)
Three Months Ended Six Months Ended
March 31, March 31, Percentage March 31, March 31, Percentage
2004 2003 Change 2004 2003 Change
---- ---- ------ ---- ---- ------
Interest Income $16,155 $14,743 9.58% $31,692 $29,483 7.49%
Interest Expense 5,848 5,625 3.96% 11,574 11,432 1.24%
----- ----- ------ ------
Net Interest Income 10,307 9,118 13.04% 20,118 18,051 11.45%
Provision for Loan Losses 500 870 -42.53% 1,050 1,305 -19.54%
--- --- ----- -----
Net Interest Income After
Provision for Loan Losses 9,807 8,248 18.90% 19,068 16,746 13.87%
Other Income * 2,430 2,715 -10.50% 4,757 5,382 -11.61%
General & Administrative
Expenses ** 6,729 6,683 0.69% 13,345 13,547 -1.49%
----- ----- ------ ------
Earnings Before Taxes 5,508 4,280 28.69% 10,480 8,581 22.13%
Income Taxes 1,831 1,526 19.99% 3,484 3,077 13.23%
----- ----- ----- -----
Net Income $3,677 $2,754 33.51% $6,996 $5,504 27.11%
====== ====== ====== ======
Basic $0.26 $0.19 36.84% $0.49 $0.39 25.64%
===== ===== ===== =====
Diluted $0.24 $0.19 26.32% $0.46 $0.37 24.32%
===== ===== ===== =====
Average Common Shares Outstanding
Basic (in thousands) 14,338 14,145 1.36% 14,254 14,110 1.02%
Average Common Shares Outstanding
Diluted (in thousands) 15,143 14,710 2.94% 15,071 14,755 2.14%
Net Interest Margin 3.55% 3.87% -8.27% 3.52% 3.84% -8.33%
Return on Average Assets 1.18% 1.05% 12.38% 1.14% 1.08% 5.56%
Return on Average Equity 18.70% 15.69% 19.18% 18.17% 15.97% 13.78%
* Gains (losses) on sales of securities of ($67,000) and ($267,000) are included
in other income for the quarter and six months ended March 31, 2004,
respectively. For the quarter and six months ended March 31, 2003, gains were
$301,000 and $515,000, respectively.
** Prepayment penalties on FHLB advances of $68,000 and $77,000 are included in
general and administrative expenses for the quarter and six months ended March
31, 2004, respectively. For the quarter and six months ended March 31, 2003,
prepayment penalties were $564,000 and $1.7 million, respectively.
COASTAL FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited - Dollars in Thousands Except Per Share Data)
(CONTINUED)
Percentage
At At At Change from
March 31, Sept 30, March 31, September 30,
2004 2003 2003 2003
.......... ......... ......... .............
Total Assets $1,262,278 $1,181,209 $1,069,869 6.86%
Loans Receivable, Net $ 765,576 $ 701,833 $ 636,842 9.08%
Deposits $ 696,910 $ 697,012 $ 671,192 -0.01%
Shareholders' Equity $ 81,006 $ 73,707 $ 70,678 9.90%
Non-Performing Assets
To Total Assets** 0.58% 0.77% 0.67% -24.68%
Allowance for Loan Losses as a
Percentage of Total Loans 1.41% 1.40% 1.40% 0.71%
Tangible Book Value
Per Share $ 5.63 $ 5.18 $ 4.99 8.69%
At or for the
Three Months Ended
March 31, September 30, Percentage
2004 2003 Change
.......... ............. ..........
Credit Quality:
Non-Performing Loans $ 6,068 $ 7,449 -18.54%
Non-Performing Loans as a % of Loans 0.79% 1.06% -25.47%
Allowance for Loan Losses as a % of
Non-Performing Loans 177.29% 131.99% 34.32%
Non-Performing Assets ** $ 7,337 $ 9,077 -19.17%
Non-Performing Assets as a % of Loans
and Foreclosed Property 0.96% 1.29% -25.58%
Net Loan Charge-Offs
as a % of Average Loans (Annualized) 0.03% 0.11% -72.73%
Stock Performance
At Quarter End:
Market Price Per Share of Common Stock $ 16.25 $ 12.72 27.75%
Indicated Annual Dividend $0.20 $0.20 n/a
Dividend Yield 1.23% 1.57% -21.66%
Price/Book Ratio 289.00% 245.00% 17.96%
Market Capitalization $ 233,838 $ 180,765 29.36%
** Non-performing assets consist of nonaccrual loans, accruing loans 90 days or
more past due and real estate owned.