Emclaire Financial Corp (NASDAQ:EMCF), the parent holding company
of The Farmers National Bank of Emlenton, reported consolidated net
income of $1.7 million, or $0.77 per diluted share, for the three
months ended September 30, 2017, an increase of $649,000, or 61.3%,
from $1.1 million, or $0.49 per diluted share, reported for the
same period in 2016. Net income for the nine-month period
ended September 30, 2017 was $3.7 million, or $1.69 per diluted
share, an increase of $914,000, or 32.8%, from $2.8 million, or
$1.29 per diluted share, for the same period in 2016.
The increase in net income for both periods was
due in part to a $1.3 million bargain purchase gain recorded during
the third quarter of 2017 related to the acquisition of Northern
Hancock Bank and Trust Co. (NHBT) in Newell, West Virginia on
September 30, 2017. This gain resulted as the fair value of the
assets acquired less the liabilities assumed exceeded the purchase
price. Partially offsetting this gain, acquisition costs totaled
$963,000 and $1.1 million, respectively, for the current quarter
and year-to-date periods. In connection with this transaction, the
Corporation added approximately $18.5 million in loans and $19.7
million in deposits.
Also positively impacting net income for both
periods was growth in loans outstanding, which led to increases in
net interest income of 10.6% and 11.7% for the current quarter and
year-to-date period, respectively. Partially offsetting this
increase were increases in noninterest expense, the provision for
loan losses and the provision for income taxes. The
Corporation realized an annualized return on average assets of
0.91% and an annualized return on average equity of 11.80% for the
quarter ended September 30, 2017, compared to 0.60% and 7.64%,
respectively, for the same period in 2016.
William C. Marsh, Chairman, President and Chief
Executive Officer of the Corporation and the Bank, noted, “The
Board of Directors, management and I are pleased with the core
operating results and considerable balance sheet growth experienced
during the first nine months of 2017 and the successful acquisition
of NHBT in September 2017. We continue to realize significant loan
production and deposit growth across our franchise including our
newer offices in Allegheny County and we look forward to serving
the Hancock County, West Virginia market. We remain focused on
sustaining a sound capital base while providing an attractive
return to our shareholders and are well-positioned for future
profitable growth.”
OPERATING RESULTS OVERVIEW
Net income increased $649,000, or 61.3%, to $1.7
million or $0.77 per diluted share for the three months ended
September 30, 2017, compared to $1.1 million or $0.49 per diluted
share for the same period in 2016. The increase resulted from
increases in noninterest income and net interest income of $1.3
million and $532,000, respectively, partially offset by increases
in noninterest expense, the provision for loan losses and the
provision for income taxes of $948,000, $102,000 and $95,000,
respectively.
Noninterest income increased $1.3 million to
$2.3 million for the three months ended September 30, 2017 from
$1.0 million for the same period in 2016. During the quarter
ended September 30, 2017, the Corporation recorded a $1.3 million
bargain purchase gain related to the acquisition of NHBT. Partially
offsetting this gain, the Corporation realized gains on the sale of
loans of $46,000 during the quarter ended September 30, 2017,
compared to gains of $121,000 during the same period in 2016.
Net interest income increased $532,000, or
10.6%, to $5.5 million for the three months ended September 30,
2017 from $5.0 million for the same period in 2016. The
increase in net interest income resulted from an increase in
interest income of $589,000, or 9.7%, primarily due to a $50.4
million increase in the average balance of loans. Partially
offsetting the increase in interest income, interest expense
increased $57,000, or 5.2%, as the Corporation’s average balance of
interest-bearing deposits and borrowed funds increased $37.0
million and $4.0 million, respectively. Driving the increases
in the Corporation’s interest-earning assets and interest-bearing
liabilities was the acquisition of United-American Savings Bank
(UASB) in April 2016 coupled with strong loan production in late
2016 and through the first nine months of 2017.
Noninterest expense increased $948,000, or
21.1%, to $5.4 million for the quarter ended September 30, 2017
from $4.5 million for the same period in 2016. The increase
was due to $963,000 of expenses related to the acquisition of NHBT
including contract termination fees, data conversion costs,
professional fees for legal and accounting services and severance
costs.
The provision for loan losses increased
$102,000, or 60.7%, to $270,000 for the three months ended
September 30, 2017 from $168,000 for the same period in 2016 due to
general increases in the Corporation's loan portfolio. Asset
quality continues to be strong as the Corporation's nonperforming
loans to total loans was 0.54% at September 30, 2017 compared to
0.52% at December 31, 2016 while criticized and classified loans to
total loans was 2.61% at September 30, 2017 compared to 2.46% at
December 31, 2016.
The provision for income taxes increased $95,000
or 32.0%, to $392,000 for the three months ended September 30, 2017
from $297,000 for the same period in 2016. This related to an
increase in the Corporation's taxable income, partially offset by a
decrease in the Corporation’s effective tax rate to 18.7% for the
third quarter of 2017 from 21.9% for the same period in 2016.
CONSOLIDATED YEAR-TO-DATE OPERATING
RESULTS OVERVIEW
Net income increased $914,000, or 32.8%, to $3.7
million or $1.69 per diluted share for the nine months ended
September 30, 2017, compared to $2.8 million or $1.29 per diluted
share for the same period in 2016. The increase resulted from
increases in net interest income and noninterest income of $1.7
million and $1.3 million, respectively, partially offset by
increases in noninterest expense, the provision for loan losses and
the provision for income taxes of $1.8 million, $163,000 and
$98,000, respectively.
Net interest income increased $1.7 million, or
11.7%, to $16.1 million for the nine months ended September 30,
2017 from $14.4 million for the same period in 2016. The
increase in net interest income resulted from an increase in
interest income of $2.0 million, or 11.4%, as the Corporation
experienced a $71.1 million increase in the average balance of
loans. Partially offsetting the increase in interest income,
interest expense increased $292,000, or 9.9%, as the Corporation's
average balance of interest-bearing deposits and borrowed funds
increased $48.3 million and $5.0 million, respectively. The
increases in the Corporation's interest-earning assets and
interest-bearing liabilities primarily related to the
aforementioned acquisition of UASB in April 2016 and strong loan
and deposit production across the Bank's franchise.
Noninterest income increased $1.3 million, or
46.2%, to $4.0 million for the nine month period ended September
30, 2017 from $2.7 million for the same period in 2016. During the
nine months ended September 30, 2017, the Corporation recorded the
aforementioned $1.3 million bargain purchase gain related to the
acquisition of NHBT. During the same period, the Corporation
also recorded a $508,000 other-than-temporary impairment charge on
a subordinated debt investment issued by First NBC Bank Holding
Company. On April 28, 2017, the Louisiana Office of Financial
Institutions closed First NBC Bank, the wholly owned banking
subsidiary of First NBC Bank Holding Company, and named the FDIC as
receiver for the bank. Partially offsetting this impairment
charge, the Corporation realized securities gains of $350,000
during the nine months ended September 30, 2017, compared to
$83,000 during the same period in 2016. Additionally, gains
on the sale of loans totaled $176,000 for the nine months ended
September 30, 2017 compared to $121,000 during the same period in
2016 and customer service fees increased $126,000 as overdraft
charges for the first nine months of 2017 outpaced the same period
last year.
The provision for loan losses increased
$163,000, or 34.7%, to $633,000 for the nine months ended September
30, 2017 from $470,000 for the same period in 2016 due to general
increases in the Corporation's loan portfolio.
Noninterest expense increased $1.8 million, or
13.6%, to $14.7 million for the nine months ended September 30,
2017 from $13.0 million for the same period in 2016. The
increase related to increases in acquisition costs, compensation
and benefits, other noninterest expense, premises and equipment,
professional fees, federal deposit insurance and intangible asset
amortization of $668,000, $473,000, $469,000, $93,000, $30,000,
$20,000 and $12,000, respectively. During the nine months ended
September 30, 2017, the Corporation realized costs of $1.1 million
related to the acquisition of NHBT, compared to $401,000 of costs
related to the acquisition of UASB during the same period in 2016.
Increases in other expense items were primarily related to the
operation of two new full-service banking offices as well as normal
salary and benefit increases.
The provision for income taxes increased $98,000
or 11.1%, to $978,000 for the nine months ended September 30, 2017
from $880,000 for the same period in 2016. This related to an
increase in the Corporation's taxable income, partially offset by a
decrease in the Corporation’s effective tax rate to 20.9% for the
nine months ended September 30, 2017 from 24.0% for the same period
in 2016.
CONSOLIDATED BALANCE SHEET & ASSET
QUALITY OVERVIEW
Total assets increased $81.8 million, or 11.8%,
to $773.9 million at September 30, 2017 from $692.1 million at
December 31, 2016. Asset growth was driven by increases in
net loans receivable and cash and equivalents of $59.3 million and
$22.7 million, respectively. Liabilities increased $76.1
million, or 11.9%, to $714.2 million at September 30, 2017 from
$638.1 million at December 31, 2016 due to an increase in customer
deposits of $77.6 million. The Corporation added approximately
$18.5 million in loans and $19.7 million in deposits through the
acquisition of NHBT.
Asset quality remained stable as total
nonperforming assets were $4.2 million, or 0.54% of total assets at
September 30, 2017 compared to $3.6 million, or 0.52% of total
assets at December 31, 2016.
Stockholders’ equity increased $5.7 million, or
10.5%, to $59.8 million at September 30, 2017 from $54.1 million at
December 31, 2016 primarily due to proceeds from the exercise of
stock options of $1.4 million, $1.7 million of common stock issued
in connection with the acquisition of NHBT and net income of $3.7
million for the nine month period, offset by common stock dividends
paid of $1.8 million. The Corporation remains well capitalized
and is positioned for continued growth with total stockholders’
equity at 7.7% of total assets. Tangible book value per
common share was $21.60 at September 30, 2017, compared to $20.08
at December 31, 2016.
Emclaire Financial Corp is the parent company of
The Farmers National Bank of Emlenton, an independent, nationally
chartered, FDIC-insured community bank headquartered in Emlenton,
Pennsylvania, operating 18 full service banking offices in Venango,
Allegheny, Butler, Clarion, Clearfield, Crawford, Elk, Jefferson
and Mercer counties, Pennsylvania and Hancock County, West
Virginia. The Corporation’s common stock is quoted on and
traded through the NASDAQ Capital Market under the symbol
“EMCF”. For more information, visit the Corporation’s website
at “www.emclairefinancial.com”.
This news release may contain forward-looking
statements as defined in the Private Securities Litigation Reform
Act of 1995. Forward-looking statements may contain words such as
“believe”, “expect”, “anticipate”, “estimate”, “should”, “may”,
“can”, “will”, “outlook”, “project”, “appears” or similar
expressions. Such forward-looking statements are subject to
risk and uncertainties which could cause actual results to differ
materially from those currently anticipated due to a number of
factors. Such factors include, but are not limited to, changes in
interest rates which could affect net interest margins and net
interest income, the possibility that increased demand or prices
for the Corporation's financial services and products may not
occur, changing economic and competitive conditions, technological
and regulatory developments, and other risks and uncertainties,
including those detailed in the Corporation's filings with the
Securities and Exchange Commission. The Corporation does not
undertake, and specifically disclaims any obligation to update any
forward-looking statements to reflect occurrences or unanticipated
events or circumstances after the date of such statements.
INVESTOR RELATIONS CONTACT:
William C. MarshChairman, President andChief Executive
OfficerPhone: (844) 800-2193Email:
investor.relations@farmersnb.com
|
|
EMCLAIRE FINANCIAL CORP |
|
Consolidated Financial
Highlights |
|
(Unaudited - Dollar amounts in thousands, except share
data) |
|
|
|
|
|
CONSOLIDATED OPERATING RESULTS DATA: |
Three month period |
|
Nine month period |
|
|
|
|
ended September 30, |
|
ended September 30, |
|
|
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
|
Interest
income |
$ |
6,683 |
|
|
$ |
6,094 |
|
|
$ |
19,289 |
|
|
$ |
17,319 |
|
|
Interest
expense |
|
1,146 |
|
|
|
1,089 |
|
|
|
3,230 |
|
|
|
2,938 |
|
|
|
Net interest
income |
|
|
5,537 |
|
|
|
5,005 |
|
|
|
16,059 |
|
|
|
14,381 |
|
|
Provision
for loan losses |
|
270 |
|
|
|
168 |
|
|
|
633 |
|
|
|
470 |
|
|
Noninterest
income |
|
2,274 |
|
|
|
1,012 |
|
|
|
3,996 |
|
|
|
2,734 |
|
|
Noninterest
expense |
|
5,442 |
|
|
|
4,494 |
|
|
|
14,740 |
|
|
|
12,975 |
|
|
|
Income before provision
for income taxes |
|
|
2,099 |
|
|
|
1,355 |
|
|
|
4,682 |
|
|
|
3,670 |
|
|
Provision
for income taxes |
|
392 |
|
|
|
297 |
|
|
|
978 |
|
|
|
880 |
|
|
|
Net income |
|
$ |
1,707 |
|
|
$ |
1,058 |
|
|
$ |
3,704 |
|
|
$ |
2,790 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
earnings per common share |
$ |
0.77 |
|
$ |
0.49 |
|
$ |
1.70 |
|
$ |
1.30 |
|
Diluted
earnings per common share |
$ |
0.77 |
|
$ |
0.49 |
|
$ |
1.69 |
|
$ |
1.29 |
|
Dividends
per common share |
$ |
0.27 |
|
$ |
0.26 |
|
$ |
0.81 |
|
$ |
0.78 |
|
Return on
average assets (1) |
|
0.91 |
% |
|
|
0.60 |
% |
|
|
0.69 |
% |
|
|
0.57 |
% |
|
Return on
average equity (1) |
|
11.80 |
% |
|
|
7.64 |
% |
|
|
8.87 |
% |
|
|
6.87 |
% |
|
Yield on
average interest-earning assets |
|
3.88 |
% |
|
|
3.82 |
% |
|
|
3.92 |
% |
|
|
3.86 |
% |
|
Cost of
average interest-bearing liabilities |
|
0.83 |
% |
|
|
0.85 |
% |
|
|
0.82 |
% |
|
|
0.83 |
% |
|
Cost of
funds |
|
0.67 |
% |
|
|
0.68 |
% |
|
|
0.66 |
% |
|
|
0.66 |
% |
|
Net
interest margin |
|
3.23 |
% |
|
|
3.15 |
% |
|
|
3.28 |
% |
|
|
3.22 |
% |
|
Efficiency
ratio |
|
67.76 |
% |
|
|
71.92 |
% |
|
|
72.42 |
% |
|
|
73.26 |
% |
|
____________________ |
|
|
|
|
|
|
|
|
(1)
Returns are annualized for the three and nine month periods ended
September 30, 2017 and 2016. |
|
|
|
|
|
|
|
CONSOLIDATED BALANCE SHEET DATA: |
|
As of |
|
As of |
|
|
|
|
|
|
|
|
9/30/2017 |
|
12/31/2016 |
|
Total
assets |
|
|
|
|
$ |
773,940 |
|
|
$ |
692,135 |
|
|
Cash and
equivalents |
|
|
|
|
|
40,256 |
|
|
|
17,568 |
|
|
Securities |
|
|
|
|
|
101,301 |
|
|
|
101,560 |
|
|
Loans,
net |
|
|
|
|
|
574,736 |
|
|
|
515,435 |
|
|
Deposits |
|
|
|
|
|
662,552 |
|
|
|
584,940 |
|
|
Borrowed
funds |
|
|
|
|
|
41,250 |
|
|
|
44,000 |
|
|
Stockholders' equity |
|
|
|
|
|
59,753 |
|
|
|
54,073 |
|
|
Book value
per common share |
|
|
|
|
$ |
26.39 |
|
|
$ |
25.12 |
|
|
Tangible
book value per common share |
|
|
|
|
$ |
21.60 |
|
|
$ |
20.08 |
|
|
Net loans
to deposits |
|
|
|
|
|
86.75 |
% |
|
|
88.13 |
% |
|
Allowance
for loan losses to total loans |
|
|
|
|
|
1.02 |
% |
|
|
1.06 |
% |
|
Nonperforming assets to total assets |
|
|
|
|
|
0.54 |
% |
|
|
0.52 |
% |
|
Stockholders' equity to total assets |
|
|
|
|
|
7.72 |
% |
|
|
7.81 |
% |
|
Shares of
common stock outstanding |
|
|
|
|
|
2,264,389 |
|
|
|
2,152,358 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Emclaire Financial (NASDAQ:EMCF)
Historical Stock Chart
From Mar 2024 to Apr 2024
Emclaire Financial (NASDAQ:EMCF)
Historical Stock Chart
From Apr 2023 to Apr 2024