Exhibit 99.1
MIDSOUTH BANCORP, INC. REPORTS 3RD QUARTER EARNINGS
LAFAYETTE, La., Oct. 25 /PRNewswire-FirstCall/ -- MidSouth Bancorp, Inc.
(Amex: MSL) announced third quarter 2005 net income of $1,634,000, a decrease of
$320,000 from the $1,954,000 earned in the third quarter of 2004 and a decrease
of $406,000 from the $2,040,000 earned in the second quarter of 2005.
During the third quarter of 2005, MidSouth Bancorp, Inc. ("the Company")
successfully met the challenges presented by two devastating hurricanes, Katrina
and Rita. In the aftermath of both storms, the Company's headquarters and data
processing center were unaffected and access to customer accounts was not
interrupted. MidSouth Bancorp's team of associates worked diligently to ensure
customers' needs were met.
With Katrina, the Company's Louisiana subsidiary, MidSouth Bank,
experienced short-term power outages at its newly opened Baton Rouge office and
the loan production office in Houma, but no physical property damage. Completion
of the new Houma banking office has been delayed due to supply problems
resulting from the hurricane. Hurricane Rita brought mandatory evacuations,
extended power outages and minor damage to four of the Company's Texas
subsidiary, Lamar Bank ("Lamar"), offices in southeast Texas and three MidSouth
Bank offices in southwest Louisiana. Within one week, limited services were
available in all of the Company's affected markets. Customers were also serviced
through Lamar offices in College Station and Conroe and through MidSouth Bank's
Customer Care Center, operations departments and branch offices. All offices are
currently fully functional and operating under normal conditions.
Although the total impact of the hurricanes affecting the Company's service
area may not be fully known at this time, management estimates service charge
income, primarily NSF fees, was negatively impacted by approximately $60,000 in
August and September 2005. Despite the negative impact, service charge income
increased in both quarterly and year-to-date comparison.
MidSouth Bank and Lamar lenders connected with their customers after the
storms to assist in meeting their needs and to assess potential credit issues
resulting from the storms. Initial discussions with customers and preliminary
analysis of exposure in the affected areas reflected no significant immediate
credit losses resulting directly from the hurricanes. Further analysis will be
performed to assess credit-related risks resulting from the storms. At this
time, management believes the $300,000 added to the provision for loan losses in
the third quarter of 2005 is adequate to bring the Allowance for Loan Losses
("ALL") to a sufficient level to cover probable losses within the loan
portfolio. Provision expense increased $50,000 in comparison to the $250,000
expensed to the provision for loan losses in the third quarter of 2004.
Continuing third quarter comparison, start up costs totaling approximately
$178,000, including salaries, marketing and occupancy expenses, for four new
retail store locations impacted third quarter 2005 earnings. Finally, $130,000
in gains on sales of investment securities was recorded in the third quarter of
2004. No nonrecurring income was recorded in the third quarter of 2005.
In addition to the $178,000 in start-up costs and the $60,000 negative
impact to service charge income recorded in the third quarter of 2005, the
$406,000 decrease in earnings from the second quarter of 2005 resulted primarily
from a $234,000 increase in the third quarter provision for loan losses and from
nonrecurring income recognized in the second quarter of 2005 of $93,000 received
as a distribution by PULSE. The provision for loan losses totaled $300,000 for
the third quarter 2005 and was necessary to support the risk profile of the loan
portfolio relative to growth.
Basic earnings per share were $.33 for the quarter ended September 30,
2005, compared to $.45 per share reported for the third quarter of 2004, and
$.42 per share earned in the second quarter of 2005. Diluted earnings per share
were $.32 for the third quarter of 2005 compared to $.43 per share for the third
quarter of 2004 and $.40 for the second quarter of 2005. Earnings per share data
have been adjusted to reflect a 10% stock dividend on common stock to holders of
record on July 29, 2005 and payable on August 19, 2005.
Year-to-date earnings as of September 30, 2005 totaled $5,598,000, a 4.4%
increase over the $5,360,000 reported for the nine months ended September 30,
2004. Basic earnings per share were $1.14 at September 30, 2005 versus $1.22 per
share at September 30, 2004. Diluted earnings per share were $1.10 versus $1.17,
respectively.
Highlights for the Quarter Ended September 30, 2005
* Return on average equity was 12.51% for the third quarter of 2005
compared to 22.46% for the third quarter of 2004. The return on
average common equity for 2005 was affected by the issuance of stock
in connection with MidSouth Bancorp, Inc.'s acquisition of Lamar
Bancshares, Inc., the parent company of Lamar, on October 1, 2004. The
leverage capital ratio was 8.97% at September 30, 2005 compared to
9.66% at September 30, 2004.
* Net interest income totaled $6,925,000 for the third quarter of 2005,
up 28.6% from the $5,384,000 reported for the third quarter of 2004.
Net interest income increased primarily due to a 30% increase in the
average volume of earning assets, including approximately $102 million
in earning assets acquired from Lamar. Net of Lamar earning assets
acquired, the Company increased the average volume of earning assets
by approximately $32 million or 7% over the past twelve months.
* Total consolidated assets increased $157.3 million or 31.3%, from
$502.2 million at the end of the third quarter of 2004 to $659.5
million at the end of the third quarter of 2005. Net of $127.8 million
in assets acquired from Lamar, the Company increased total
consolidated assets by $29.5 million, or 5.9% over the past twelve
months.
* Total loans grew $140.4 million or 47.8%, from $294.1 million at
September 30, 2004 to $434.5 million at September 30, 2005, primarily
in commercial, real estate and agricultural credits. Net of $81.4
million in loans acquired from Lamar, the Company increased total
loans by $59 million, or 20.1% over the past twelve months.
* Nonperforming assets, including loans 90 days or more past due,
totaled $2.95 million at September 30, 2005. As a percentage of total
assets, nonperforming assets increased to .45% at September 30, 2005,
up from .17% at September 30, 2004. Nonperforming assets increased
primarily due to the placement of a single oil and gas service
relationship aggregating $1.3 million on nonaccrual status during the
second quarter of 2005. The relationship is well secured and there is
currently no expectation of loss should the loan relationship be
liquidated. Charge-off volume decreased with net charge-offs to total
loans at .07% compared to .17% for the same periods, respectively.
* Total deposits increased $142.7 million or 32.1%, from $443.7 million
at September 30, 2004 to $586.4 million at September 30, 2005. Other
than $97.2 million in deposits acquired in the Lamar acquisition,
deposit growth has been primarily in the Company's Platinum money
market accounts. Additionally, the core non-interest bearing demand
accounts have continued to grow and represent approximately 25% of
total deposits at September 30, 2005.
Components of Third Quarter Earnings
Net interest income for the third quarter of 2005 increased $1.5 million or
28.6% compared to the third quarter of 2004. Of the $1.5 million, approximately
$1.1 million was attributed to the addition of Lamar's net interest income and
the remaining $400,000 was attributed to an increase in MidSouth Bank's net
interest income. Although MidSouth Bank's total interest income increased
approximately $1.5 million due to increased earning asset volume in the third
quarter of 2005, the increase was mostly offset by an $1.1 million increase in
interest expense on deposits as compared to the third quarter of 2004. The
increase in interest expense resulted primarily from a higher average volume of
interest-bearing deposits that are indexed to the 90-day Treasury bill, which
increased 177 basis points over the past 12 months.
Non-interest income for the third quarter of 2005 increased $464,000
compared to the third quarter 2004. Net of Lamar's contribution of approximately
$500,000 to the increase in non-interest income, MidSouth Bank's non-interest
income decreased by $36,000. The decrease resulted primarily from $130,000 in
nonrecurring income from gains on sales of investment securities that was
recorded during the third quarter of 2004. MidSouth Bank's service charges on
deposit accounts increased $40,000 in quarterly comparison, net of the $60,000
decrease in NSF fees resulting from the hurricanes.
Non-interest expense increased $2.4 million from the third quarter of 2004
to the third quarter of 2005, primarily due to Lamar expenses totaling $1.7
million. Lamar's expenses for the third quarter of 2005 included approximately
$40,000 in start-up cost for the new Conroe retail store. Of the remaining $.7
million increase in non-interest expenses at MidSouth Bank, approximately
$452,000 was attributed to salaries and benefits and $95,000 to occupancy
expenses.
In year-to-date comparison, total net income increased $238,000 or 4.4%.
Lamar's contribution of approximately $316,000 to the increase was effected by
the $84,500 in conversion costs and by approximately $232,000 in related
amortization of core deposit intangibles, net of income taxes.
MidSouth Bank contributed $213,000 in additional income for the first nine
months of 2005 compared to 2004, as increases in net interest income of $1.3
million and non-interest income of $1.5 million offset increased non- interest
expenses of $2.6 million. The increase in non-interest expenses resulted
primarily from increased salaries and benefit costs ($1,165,000), accounting
fees ($246,000), and occupancy ($369,000), marketing ($292,000) and education
and travel ($89,000) expenses. The increase in non-interest expenses reflect
MidSouth Bank's long-term investment in market development, staff development
and system upgrades.
At the parent company level, increased interest expense of $359,000 on
trust preferred securities further contributed to additional net losses of
$275,000 for the parent company at September 30, 2005 compared to September 30,
2004.
In the fourth quarter of 2005, management expects the four new retail
offices to impact fourth quarter expenses and any substantial contributions to
income will not be reflected until 2006. Additional expenses may be incurred in
the fourth quarter of 2005 through insurance deductibles, facility repairs and
other related expenses resulting from Hurricane Rita, which made landfall during
the last week of September 2005. The extent of damages and costs of repairs were
still being determined at quarter-end, however management feels the damages were
minimal and the costs will not be significant.
MidSouth Bancorp, Inc. is a two-bank holding company headquartered in
Lafayette, Louisiana whose wholly-owned active subsidiaries are MidSouth Bank,
N.A., also headquartered in Lafayette, and Lamar Bank, headquartered in
Beaumont, Texas. The MidSouth franchise consists of 27 banking offices and one
loan production office throughout south Louisiana and southeast Texas.
MidSouth's common stock is traded on the American Stock Exchange under the
symbol MSL. The Private Securities Litigation Act of 1995 provides a safe harbor
for disclosure of information about a company's anticipated future financial
performance. This act protects a company from unwarranted litigation if actual
results differ from management expectations. This press release reflects
management's current views and estimates of future economic circumstances,
industry conditions, MidSouth's performance and financial results. A number of
factors and uncertainties could cause actual results to differ from anticipated
results and expectations.
MIDSOUTH BANCORP, INC. AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS (UNAUDITED)
(in thousands except per share data)
For The Qtr For The
Ended Sept. 30, Qtr Ended
---------------------------- % June 30, %
EARNINGS DATA 2005 2004 Chg 2005 Chg
- ------------------------- ------------ ------------ ------------ ------------ ------------
Total interest
income $ 9,882 $ 6,815 45.0% $ 9,333 5.9%
Total interest
expense 2,957 1,431 106.6% 2,476 19.4%
Net interest
income 6,925 5,384 28.6% 6,857 1.0%
Provision for
loan losses 300 250 20.0% 66 354.5%
Non-interest
income 2,840 2,376 19.5% 3,170 -10.4%
Non-interest
expense 7,319 4,934 48.3% 7,187 1.8%
Provision for
income tax 512 622 -17.7% 734 -30.2%
Net income $ 1,634 $ 1,954 -16.4% $ 2,040 -19.9%
PER COMMON SHARE
DATA (A)
Basic earnings
per share $ 0.33 $ 0.45 -25.9% $ 0.42 -21.4%
Diluted
earnings per
share $ 0.32 $ 0.43 -25.1% $ 0.40 -20.0%
Book value at
end of period $ 10.66 $ 8.33 28.0% $ 10.49 1.6%
Market price
at end of
period $ 30.40 $ 24.00 26.7% $ 22.27 36.5%
Weighted avg
shares
outstanding
Basic 4,905,783 4,376,703 12.1% 4,897,241 0.2%
Diluted 5,086,647 4,574,688 11.2% 5,068,921 0.3%
AVERAGE BALANCE
SHEET DATA
Total assets $ 650,219 $ 483,738 34.4% $ 623,095 4.4%
Earning assets 587,787 453,758 29.5% 566,505 3.8%
Loans and
leases 422,588 284,840 48.4% 401,581 5.2%
Interest-bearing
deposits 438,058 335,087 30.7% 415,034 5.5%
Total deposits 574,754 433,976 32.4% 547,347 5.0%
Total
stockholders'
equity 51,813 34,613 49.7% 50,314 3.0%
SELECTED
RATIOS 09/30/2005 09/30/2004 06/30/2005
Return on average
assets 1.00% 1.61% -38.0% 1.31% -24.1%
Return on average
total equity 12.51% 22.46% -44.3% 16.26% -23.1%
Return on average
realized
equity (B) 12.42% 22.19% -44.0% 16.13% -23.0%
Average equity
to average
assets 7.97% 7.16% 11.4% 8.07% -1.3%
Leverage capital
ratio 8.97% 9.66% -7.1% 9.15% -2.0%
CREDIT QUALITY
Allowance for
loan losses as
a % of total
loans 0.97% 1.00% -3.0% 0.99% -2.0%
Nonperforming
assets to total
assets 0.45% 0.17% 164.7% 0.36% 25.0%
Net YTD charge-
offs to total
loans 0.07% 0.17% -58.8% 0.05% 40.0%
(A) Earnings per common share data has been adjusted for a 10% stock dividend
payable on August 19, 2005 to shareholders of record on July 29, 2005.
(B) Excluding net unrealized gain (loss) on securities available for sale.
MIDSOUTH BANCORP, INC. and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited)
(in thousands except per share data)
Period Ended Period Ended
Sept. 30, ----------------------------
---------------------------- % Jun. 30, Dec. 31,
BALANCE SHEET 2005 2004 Chg 2005 2004
- ------------------------------ ------------ ------------ ------------ ------------ ------------
Assets
Cash and cash equivalents $ 27,733 $ 33,226 -16.5% $ 25,534 $ 17,397
Securities available-for-
sale 133,917 135,137 -0.9% 133,336 143,261
Securities held-to-
maturity 20,086 23,133 -13.2% 21,180 22,852
Total investment
securities 154,003 158,270 -2.7% 154,516 166,113
Total loans 434,478 294,062 47.8% 410,030 386,471
Allowance for loan losses (4,211) (2,949) 42.8% (4,039) (3,850)
Loans, net 430,267 291,113 47.8% 405,991 382,621
Premises and equipment 21,680 12,553 72.7% 21,036 19,338
Goodwill and other
intangibles 10,454 941 1010.9% 10,471 10,644
Other assets 15,344 6,128 150.4% 14,345 13,975
Total assets $ 659,481 $ 502,231 31.3% $ 631,893 $ 610,088
Liabilities and
Stockholders' Equity
Non-interest bearing
deposits $ 148,895 $ 100,296 48.5% $ 130,525 $ 124,659
Interest bearing deposits 437,509 343,454 27.4% 428,197 405,724
Total deposits 586,404 443,750 32.1% 558,722 530,383
Securities sold under
agreements to repurchase
and FHLB borrowings 2,191 5,213 -58.0% 2,354 12,412
Junior subordinated
debentures 15,465 15,000 3.1% 15,465 15,465
Other liabilities 3,045 1,710 3.1% 3,829 3,255
Total liabilities 607,105 465,673 78.1% 580,370 561,515
Total shareholders'
equity 52,376 36,558 30.4% 51,523 48,573
Total liabilities
and shareholders'
equity $ 659,481 $ 502,231 31.3% $ 631,893 $ 610,088
MIDSOUTH BANCORP, INC. and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited)
(in thousands except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------- % --------------------------- %
INCOME STATEMENT 2005 2004 Chg 2005 2004 Change
- ------------------------------ ------------ ------------ ------------ ------------ ------------ ------------
Interest income $ 9,882 $ 6,815 45.0% $ 27,853 $ 19,295 44.4%
Interest expense 2,957 1,431 106.6% 7,646 3,804 101.0%
Net interest income 6,925 5,384 28.6% 20,207 15,491 30.4%
Provision for loan
losses 300 250 20.0% 680 670 1.5%
Service charges on
deposit accounts 2,088 1,739 20.1% 6,415 4,665 37.5%
Gains on securities,
net 130 -100.0% 132 -100.0%
Other charges and fees 752 507 48.3% 3,019 1,494 102.1%
Total non-interest
income 2,840 2,376 19.5% 9,434 6,291 50.0%
Salaries and employee
benefits 3,653 2,419 51.0% 10,161 6,829 48.8%
Occupancy expense 1,463 1,031 41.9% 4,047 3,003 34.8%
Goodwill and
intangible
amortization 134 16 737.5% 401 49 718.4%
Other non-interest
expense 2,069 1,468 40.9% 6,850 4,020 70.4%
Total non-interest
expense 7,319 4,934 48.3% 21,459 13,901 54.4%
Income before income
taxes 2,146 2,576 -16.7% 7,502 7,211 4.0%
Provision for income
taxes 512 622 -17.7% 1,904 1,851 2.9%
Net income $ 1,634 $ 1,954 -16.4% $ 5,598 $ 5,360 4.4%
Earnings per share,
diluted $ 0.32 $ 0.43 -25.6% $ 1.10 $ 1.17 -6.0%
MIDSOUTH BANCORP, INC. and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited)
(in thousands except per share data)
Third Second First Fourth Third
INCOME STATEMENT Quarter Quarter Quarter Quarter Quarter
Quarterly Trends 2005 2005 2005 2004 2004
- ------------------------------ ---------- ---------- ---------- ---------- ----------
Interest income $ 9,882 $ 9,333 $ 8,637 $ 8,451 $ 6,815
Interest expense 2,957 2,476 2,212 1,890 1,431
Net interest income 6,925 6,857 6,425 6,561 5,384
Provision for loan losses 300 66 314 321 250
Net interest income after
provision for loan losses 6,625 6,791 6,111 6,240 5,134
Total non-interest income 2,840 3,170 3,422 2,929 2,376
Total non-interest expense 7,319 7,187 6,953 6,959 4,934
Income before income taxes 2,146 2,774 2,580 2,210 2,576
Income taxes 512 734 657 591 622
Net income $ 1,634 $ 2,040 $ 1,923 $ 1,619 $ 1,954
Earnings per share, basic $ 0.33 $ 0.42 $ 0.39 $ 0.33 $ 0.45
Earnings per share, diluted $ 0.32 $ 0.40 $ 0.38 $ 0.32 $ 0.43
Book value per share $ 10.66 $ 10.49 $ 10.03 $ 9.91 $ 8.33
Return on Average Equity 12.51% 16.26% 15.79% 13.48% 22.46%
MIDSOUTH BANCORP, INC. and SUBSIDIARIES
Condensed Consolidated Financial Information (unaudited)
(in thousands except per share data)
Period Ended Period Ended
Sept. 30, ------------------------
------------------------ % Jun. 30, Dec. 31,
Asset Quality Data 2005 2004 Chg 2005 2004
- ------------------------------ ---------- ---------- ---------- ---------- ----------
Nonaccrual loans $ 2,125 $ 482 340.9% $ 1,892 $ 472
Loans past due 90
days and over 561 283 98.2% 128 488
Total nonperforming loans 2,686 765 251.1% 2,020 960
Other real estate owned 111 86 29.1% 98 445
Other foreclosed assets 154 156 283
Total nonperforming assets $ 2,951 $ 851 246.8% $ 2,274 $ 1,688
Nonperforming assets to
total assets 0.45% 0.17% 165.6% 0.36% 0.28%
Nonperforming assets to
total loans + OREO + other
foreclosed assets 0.68% 0.29% 135.0% 0.55% 0.44%
ALL to nonperforming assets 142.70% 346.53% -58.8% 177.62% 228.08%
ALL to nonperforming loans 156.78% 385.49% -59.3% 199.95% 401.04%
ALL to total loans 0.97% 1.00% -3.3% 0.99% 1.00%
Year-to-date charge-offs $ 482 $ 644 -25.2% $ 310 $ 1,067
Year-to-date recoveries 163 133 22.6% 119 182
Year-to-date net charge-offs $ 319 $ 511 -37.6% $ 191 $ 885
Net YTD charge-offs to total
loans 0.07% 0.17% -59.7% 0.05% 0.23%
SOURCE MidSouth Bancorp, Inc.
-0- 10/25/2005
/CONTACT: Sally Gary, Investor Relations, +1-337-267-4202, or
sallyg@midsouthbank.com , or Teri Stelly, Controller, +1-337-267-4208, or C.
R. Rusty Cloutier, President, +1-337-267-4201, all of MidSouth Bancorp, Inc./
(MSL)