Exhibit 99.1
Press Release Dated July 28, 2004
NEWS ANNOUNCEMENT
Date: July 28, 2004
Contact: Susan J. Cooke
To: News Media
Release Date: Immediate
COASTAL FINANCIAL CORPORATION
ANNOUNCES FISCAL 2004
THIRD QUARTER EARNINGS
Myrtle Beach, South Carolina, (July 28, 2004) . . . Coastal Financial
Corporation (Nasdaq/CFCP) today announced earnings for the third quarter and
nine months ended June 30, 2004.
Net earnings for the third quarter of fiscal 2004 increased 40.3% to $3.9
million or $0.27 per share ($0.26 per share diluted), as compared to $2.8
million or $0.20 per share ($0.19 per share diluted) for the same period of
fiscal 2003.
Net earnings for the first three quarters of fiscal 2004 increased 31.5% to
$10.9 million or $0.76 per share ($0.72 per share diluted), compared to $8.3
million or $0.59 per share ($0.56 per share diluted) for the same period of
fiscal 2003.
At June 30, 2004, assets totaled $1.3 billion, an increase of 13.1%, or $148.6
million, from $1.1 billion at June 30, 2003. Deposits increased 7.2% to $764.0
million at June 30, 2004, as compared to $712.9 million at June 30, 2003 and
Shareholders' equity grew by 8.2% during the same period.
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Returns on average assets and average equity were 1.23% and 19.60%,
respectively, for the three months ended June 30, 2004, compared to 1.01% and
15.57%, respectively, for the prior year period.
At June 30, 2004, non-performing assets to total assets were 0.46% as compared
with 0.67% at June 30, 2003.
Michael C. Gerald, President and Chief Executive Officer of Coastal Financial
Corporation, said: "Our financial performance during this quarter, and
year-to-date, reflects well on our region's continuing economic strength and on
Coastal Financial's ability to effectively execute its strategic plans. The
increase in Core Deposits and loans through internal growth and de novo
branching activities and our steadfast dedication to our QUEST FOR EXCELLENCE
Operating Philosophy have also been key factors in our exceptional financial
performance through the first nine months of fiscal 2004."
"We remain solidly focused on our Mission of Exceeding The Expectations of our
Customer through offering the residents and businesses of our local Communities
a full line of Business Banking, Personal Banking, Residential Mortgage Lending,
Financial and Tax Strategies Planning and Investment Services in ways that add
value for our Shareholders."
"During the third quarter, we announced a 33.5% increase in fiscal 2004 second
quarter net earnings over the comparable prior year quarter, the appointment of
E. Lawton Benton and J. Robert Calliham to our Board of Directors and a five
cents ($.05) per share dividend which was paid July 23, 2004 to shareholders of
record as of July 9, 2004.
"Other notable events and accomplishments during this quarter include the Grand
opening of our newest banking office in Shallotte, North Carolina, the
scheduling of a Grand opening in early August for our new office in Loris, South
Carolina and the start of construction on our third branch office in Wilmington,
North Carolina. These activities are indicative of the continued growth and
progress envisioned under our Vision 2005 Plan and clearly indicate the progress
we made during the third quarter toward our Basic Corporate Objective of
Maximizing The Value Of Our Shareholders' Investment and our Long-Term Goal of
Being The Best Financial Services Company In Our Marketplace," 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 $1.3 billion in assets, 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
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Carolina. Coastal Retirement, Estate and Tax Planners, Inc. 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.
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.
2511, 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. 2511, 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
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Forward Looking Statements
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. The Company disclaims any obligation to
update such forward-looking statements.
COASTAL FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited - Dollars in Thousands Except Per Share Data)
Three Months Ended Nine Months Ended
June 30, June 30, Percentage June 30, June 30, Percentage
2004 2003 Change 2004 2003 Change
---- ---- ------ ---- ---- ------
Interest Income $16,661 $14,790 12.65% $48,352 $44,273 9.21%
Interest Expense 5,892 5,779 1.96% 17,466 17,211 1.48%
------- ------- ------- -------
Net Interest Income 10,769 9,011 19.51% 30,886 27,062 14.13%
Provision for Loan Losses 200 750 -73.33% 1,250 2,055 -39.17%
------- ------- ------- -------
Net Interest Income After
Provision for Loan Losses 10,569 8,261 27.94% 29,636 25,007 18.51%
Other Income * 2,121 2,945 -27.98% 6,879 8,328 -17.40%
General & Administrative
Expenses ** 6,773 6,851 -1.14% 20,118 20,398 -1.37%
------- ------- ------- -------
Earnings Before Taxes 5,917 4,355 35.87% 16,397 12,937 26.74%
Income Taxes 2,018 1,575 28.13% 5,502 4,652 18.27%
------- ------- ------- -------
Net Income $ 3,899 $ 2,780 40.25% $10,895 $ 8,285 31.50%
======= ======= ======= =======
Basic $ 0.27 $ 0.20 35.00% $ 0.76 $ 0.59 28.81%
======= ======= ======= =======
Diluted $ 0.26 $ 0.19 36.84% $ 0.72 $ 0.56 28.57%
======= ======= ======= =======
Average Common Shares Outstanding
Basic (in thousands) 14,405 14,165 1.69% 14,292 14,124 1.19%
Average Common Shares Outstanding
Diluted (in thousands) 15,170 14,724 3.03% 15,096 14,747 2.37%
Net Interest Margin 3.63% 3.61% 0.55% 3.58% 3.76% -4.79%
Return on Average Assets 1.23% 1.01% 21.78% 1.17% 1.06% 10.38%
Return on Average Equity 19.60% 15.57% 25.88% 18.80% 15.84% 18.69%
* Gains (losses) on sales of securities of ($440,000) and ($707,000) are
included in other income for the quarter and nine months ended June 30, 2004,
respectively. For the quarter and nine months ended June 30, 2003, gains were
$146,000 and $662,000, respectively.
** Prepayment penalties on FHLB advances of $77,000 are included in general and
administrative expenses for the nine months ended June 30, 2004. For the quarter
ended June 30, 2004, there were no prepayment penalties. For the quarter and
nine months ended June 30, 2003, prepayment penalties were $750,000 and $2.4
million, respectively.
COASTAL FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited - Dollars in Thousands Except Per Share Data)
(CONTINUED)
Percentage
At At At Change from
June 30, Sept 30, June 30, September 30,
2004 2003 2003 2003
.......... .......... .......... .............
Total Assets $1,279,877 $1,181,209 $1,131,252 8.35%
Loans Receivable, Net $ 784,083 $ 701,833 $ 671,148 11.72%
Deposits $ 763,990 $ 697,012 $ 712,922 9.61%
Shareholders' Equity $ 78,122 $ 73,707 $ 72,209 5.99%
Non-Performing Assets
To Total Assets *** 0.46% 0.77% 0.67% -40.26%
Allowance for Loan Losses as a
Percentage of Total Loans 1.38% 1.40% 1.40% -1.43%
Tangible Book Value
Per Share $ 5.42 $ 5.19 $ 5.09 4.43%
At or for the
Three Months Ended
June 30, September 30, Percentage
2004 2003 Change
.......... ............ ..........
Credit Quality:
Non-Performing Loans $ 4,797 $ 7,449 -35.60%
Non-Performing Loans as a % of Loans 0.61% 1.06% -42.45%
Allowance for Loan Losses as a % of
Non-Performing Loans 226.04% 131.99% 71.26%
Non-Performing Assets *** $5,852 $ 9,077 -35.53%
Non-Performing Assets as a % of Loans
and Foreclosed Property 0.75% 1.29% -41.86%
Net Loan Charge-Offs
as a % of Average Loans (Annualized) 0.06% 0.11% -45.45%
Stock Performance
At Quarter End:
Market Price Per Share of Common Stock $ 14.95 $ 12.72 17.53%
Indicated Annual Dividend $ 0.20 $ 0.20 n/a
Dividend Yield 1.34% 1.57% -14.65%
Price/Book Ratio 276.00% 245.00% 12.65%
Market Capitalization $ 215,564 $ 180,789 19.24%
*** Non-performing assets consist of nonaccrual loans, accruing loans 90 days or
more past due and real estate owned.