Carolina Trust BancShares, Inc. (the “Company”) (NASDAQ
- CART) reports its financial results today for
the most recently completed fiscal quarter. In the quarter
that ended December 31, 2018 (“4Q18”), the Company’s net income was
$946,000 or $0.13 per diluted share as compared to a net loss of
($354,000) or ($0.08) per diluted share in the quarter ended
December 31, 2017 (“4Q17”), an increase of $1,300,000 or $0.21 per
diluted share. The diluted average common shares outstanding
increased to 7.2 million shares in 4Q18 from 4.8 million shares in
4Q17 following the completion of the Company’s stock offering in
the second quarter of 2018.
On June 15, 2018 the Company announced that it had entered into
a merger agreement to acquire Clover Community Bankshares, Inc.
(“Clover”) and its subsidiary bank, Clover Community Bank.
Regulators and shareholders approved the merger during the fourth
quarter of 2018 and the merger was consummated on January 1,
2019. During 4Q18 the Company incurred $264,000 in merger
expenses. If the merger expenses, net of tax, were excluded,
net income for 4Q18 would have been $1,169,000 or $0.16 per diluted
share which is a non-GAAP (Generally Accepted Accounting
Principles) measurement. Please refer to “Note Regarding Use
of Non-GAAP Financial Measures” and the non-GAAP reconciliation
tables below for additional information.
The table below summarizes the key components of net income for
4Q18 and 4Q17.
$ in thousands |
For the 3 months ended |
|
|
|
December 31, 2018 |
December 31, 2017 |
Increase (Decrease) |
% Change |
Interest
income |
$ |
5,645 |
|
$ |
4,672 |
|
$ |
973 |
|
21 |
% |
Interest expense |
|
1,233 |
|
|
916 |
|
|
317 |
|
35 |
% |
Net interest income |
|
4,412 |
|
|
3,756 |
|
|
656 |
|
17 |
% |
Provision for (recovery of) loan loss |
|
(9 |
) |
|
149 |
|
|
(158 |
) |
NM |
|
Noninterest income |
|
186 |
|
|
301 |
|
|
(115 |
) |
(38 |
%) |
Noninterest expense |
|
3,357 |
|
|
3,036 |
|
|
321 |
|
11 |
% |
Pre-tax income |
|
1,250 |
|
|
872 |
|
|
378 |
|
43 |
% |
Income tax expense |
|
304 |
|
|
1,226 |
|
|
(922 |
) |
(75 |
%) |
Net income (loss) |
$ |
946 |
|
$ |
(354 |
) |
$ |
1,300 |
|
NM |
|
|
|
|
|
|
Non-GAAP measurements: |
|
|
|
|
Net income (loss) |
$ |
946 |
|
$ |
(354 |
) |
|
|
+ Income tax expense |
|
304 |
|
|
1,226 |
|
|
|
+ Provision for (recovery of) loan loss |
|
(9 |
) |
|
149 |
|
|
|
= Pre-tax pre-provision income |
$ |
1,241 |
|
$ |
1,021 |
|
$ |
220 |
|
22 |
% |
|
|
|
|
|
Net income (loss) |
$ |
946 |
|
$ |
(354 |
) |
|
|
+ Merger expenses, net of tax |
|
223 |
|
|
-0- |
|
|
|
+ Income tax charge for deferred tax
revaluation attributed to the Tax Cuts and Jobs Act |
|
-0- |
|
|
936 |
|
|
|
= Adjusted net income (excludes merger expenses and
deferred tax revaluation) |
$ |
1,169 |
|
$ |
582 |
|
$ |
587 |
|
101 |
% |
|
|
|
|
|
Return on assets |
|
0.80 |
% |
|
(0.35 |
%) |
|
1.15 |
% |
|
Pre-tax pre-provision return on assets 1 |
|
1.05 |
% |
|
1.00 |
% |
|
0.05 |
% |
|
Return on equity |
|
7.54 |
% |
|
(4.68 |
%) |
|
12.22 |
% |
|
Net interest margin |
|
3.94 |
% |
|
3.91 |
% |
|
0.03 |
% |
|
Efficiency ratio * |
|
73 |
% |
|
75 |
% |
|
(2 |
%) |
|
Average assets |
$ |
469,480 |
|
$ |
406,191 |
|
$ |
63,289 |
|
16 |
% |
Average loans |
|
386,970 |
|
|
344,246 |
|
|
42,724 |
|
12 |
% |
Average deposits |
|
390,220 |
|
|
342,281 |
|
|
47,939 |
|
14 |
% |
Average equity ** |
|
49,748 |
|
|
30,063 |
|
|
19,685 |
|
65 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
1Note: Pre-tax pre-provision return on assets is a non-GAAP
measure. A reconciliation to GAAP is included at the end of
this release.*Note: Efficiency ratio = Noninterest expense / (Net
interest income + Noninterest income)**Note: Stock offering
completed in April 2018 added $18.4 million to equity
Comparing 4Q18 with 4Q17, the $378,000 (+43%) increase in
pre-tax income was due mostly to increases in net interest income
of $656,000 (+17%) and a decrease in provision for loan losses of
$158,000 (i.e. difference between a $9,000 recovery in 4Q18 as
compared to a $149,000 provision in 4Q17). These favorable
comparisons were offset partially by a decrease in noninterest
income of $115,000 (-38%) and an increase in noninterest expense of
$321,000 (+11%). Income tax expense decreased by $922,000
(-75%), primarily due to a 4Q17 income tax charge of $936,000 for a
deferred tax revaluation attributed to the Tax Cuts and Jobs Act of
2017. Income tax expense also decreased as a percentage of
pre-tax income due to the Company’s statutory federal tax rate
decreasing from 34% in 2017 to 21% in 2018.
Net interest income increased from $3,756,000 in 4Q17 to
$4,412,000 in 4Q18, primarily due to loan growth that was funded by
deposit growth. Average loans increased by $43 million, or
12%, from 4Q17 to 4Q18. The Mooresville and Hickory offices
and the Salisbury loan production office combined to contribute $39
million of the growth, followed by the Denver and Forest City
offices with growth totaling $8 million. Conversely, the
average loans in the Lincolnton-Main and Vale offices decreased by
$6 million from 4Q17 to 4Q18. The offices with the highest
average loan balances in 4Q18 were Gastonia ($82 million),
Mooresville ($76 million), Hickory ($69 million), and Lincolnton
Main ($68 million).
The net interest margin increased by 3 basis points from 3.91%
in 4Q17 to 3.94% in 4Q18. The margin increase was attributed
to the 29 basis point increase in loan yield from 5.12% in 4Q17 to
5.41% in 4Q18 and to the investment of proceeds from the stock
offering in April 2018. The yield on earning assets increased
by 18 basis points from 4.87% in 4Q17 to 5.05% in 4Q18.
Comparatively, the cost of funds, including deposits, borrowings
and holding company debt, increased by 20 basis points from 0.98%
in 4Q17 to 1.18% in 4Q18. The improvement in the yield on
earning assets and the net interest margin was softened by the
shift in the earning asset mix, as the ratio of average loans to
average earning assets declined from 90% in 4Q17 to 87% in
4Q18. The additional liquidity maintained in interest earning
cash and securities resulted in an increase of its share of earning
assets from 10% to 13% for the same periods. Loan yields were
positively impacted by prime rate increases of 25 basis points each
in December 2017, March 2018, June 2018, September 2018, and
December 2018.
In a linked quarter comparison, net interest margin improved by
12 basis points from 3.82% in 3Q18 to 3.94% in 4Q18. The
earning asset yield grew by 18 basis points as compared to the cost
of funds that increased by only 6 basis points. The earning
asset yield increase from 3Q18 to 4Q18 was attributable to the loan
yield growing by 9 basis points, to loans comprising a higher
percentage of average earning assets in 4Q18, and to the investment
yield increasing by 11 basis points.
Noninterest income decreased by $115,000 from $301,000 in 4Q17
to $186,000 in 4Q18. The decrease was due to an unrealized
loss on equity securities of $133,000 in 4Q18 as compared to $0 in
4Q17, which was partially offset by net interchange fee income
which increased by $21,000 (+49%) in 4Q18 as compared to
4Q17. Under GAAP, beginning in 2018, changes in fair value of
equity securities are required to be recognized in income.
Previously, changes in values were recognized through accumulated
other comprehensive income in the equity section of the balance
sheet. For the year 2018, the unrealized loss on equity
securities was only $10,000, due to appreciation during the first
nine months of 2018. Growth in noninterest bearing deposit
accounts and debit card usage resulted in additional interchange
fee income.
Noninterest expense increased by $321,000 (+11%), from
$3,036,000 in 4Q17 to $3,357,000 in 4Q18. The largest
increase was merger expense for the acquisition of Clover, which
totaled $264,000 in 4Q18 as compared to $0 in 4Q17. There
were smaller increases in salaries and benefits, up $49,000 (+3%),
in foreclosed asset expense, up $46,000 (up from a negative $2,000
in 4Q17), and shareholder expenses, up $42,000 (+124%). The
increases to salaries and benefits were attributed to normal annual
wage increases, to three additional employees in 2018, and to
accruals for new supplemental executive retirement plan agreements
that were effective in September 2018. Foreclosed asset
expenses in 4Q18 were primarily due to a $37,500 write down of a
restaurant/grocery property based a recent appraisal. The
negative foreclosed asset expense in 4Q17 was attributed to an
$8,000 credit to property tax accruals that were adjusted to year
end actual amounts. Shareholder expenses were higher in 4Q18
due to expenses associated with shareholder communications and SEC
filings.
Comparison of Financial Condition at December 31, 2018 with
September 30, 2018.
Assets increased by $9.9 million (+2%) from September 30, 2018
to December 31, 2018, as funding from deposits increased by $8.7
million (+2%) and shareholders’ equity grew by $1.3 million
(+3%). The asset growth was concentrated in loans, up $12.5
million (+3%). Investment securities increased by $2.0
million (+7%), and cash and due from banks increased $1.9 million
(+21%). Interest-earning deposits with banks decreased by
$5.4 million (-20%) and foreclosed assets decreased by $0.6 million
(-35%) following the sale of a residential property during
4Q18. Owner occupied commercial real estate loans grew by
$6.0 million (+6%) on a linked quarter basis. Other increases
included commercial and industrial loans, up $2.7 million (+6%);
multifamily real estate loans, up $2.4 million (+15%); non-owner
occupied commercial real estate, up $2.3 million (+2%); and first
lien residential mortgages, up $2.2 million (+4%). Commercial
acquisition, development, construction and land loans decreased by
$2.5 million (-11%) from September 30, 2018 to December 31,
2018.
The increase in deposits from the linked quarter was
concentrated in money market deposits, up $17.2 million (+22%),
followed by interest bearing checking accounts, up $2.2 million
(+5%). These increases were partially offset by decreases in
time deposits, noninterest earning demand deposits, and savings
accounts. A $2.3 million decrease in brokered time deposits
accounted for over half the $4.2 million decrease in time
deposits.
Management established 2018 goals for increasing balances for
each deposit category in every branch. The Company continues
to emphasize the importance of borrowers maintaining meaningful
deposit balances. Although noninterest bearing deposits
declined during the quarter by $5.7 million (-8%), there was an
increase of $11.9 million (+24%) as compared to December 31,
2017. Seven of the Bank’s nine full service offices increased
noninterest bearing deposits over the twelve month period.
Management added a cash management specialist to the staff in 2018
and has customized deposit products to meet the needs of its
business, commercial, and public sector customers in an effort to
strengthen core deposits.
With the exception of the increase in foreclosed asset expense
discussed previously, asset quality measurements continued to
improve during the fourth quarter of 2018. The ratio of
non-performing assets to total assets was 0.46% on December 31,
2018 as compared to 0.61% on September 30, 2018, as there were
decreases in both nonperforming loans and foreclosed
properties. In 4Q18, the Company’s annualized ratio of net
charge-offs (net recoveries) to average assets was (0.06%) as
compared to (0.01%) for 3Q18. The ratio of the allowance for
loan loss to total loans decreased to 1.01% at December 31, 2018 as
compared to 1.03% at September 30, 2018. The ratio of the
general allowance for non-impaired loans to total non-impaired
loans decreased by 2 basis points from 0.98% at September 30, 2018
as compared to 0.96% at December 31, 2018. The specific
allowance for impaired loans increased by $12,000 during the fourth
quarter of 2018.
Regulatory capital ratios for the Company’s wholly owned
subsidiary, Carolina Trust Bank, increased slightly from September
30, 2018 to December 31, 2018 as 4Q18 earnings resulted in
regulatory capital growing at a higher rate than the growth rate of
risk-weighted assets. The Bank’s total risk-based capital
ratio at December 31, 2018 was 13.21%, a 2 basis point increase
from 13.19% at September 30, 2018.
About Carolina Trust BancShares, Inc. Carolina
Trust BancShares, Inc. is a bank holding company and the parent
company of Carolina Trust Bank. Carolina Trust Bank is a full
service, state-chartered bank headquartered in Lincolnton,
N.C. The bank operates in nine full service offices and one
loan production office in the Piedmont and Mountain Regions of
North Carolina to the north and west of Charlotte, NC. The
bank also operates in two full service offices in the Piedmont
Region of South Carolina to the west of Charlotte, NC.
Caution Regarding Forward-Looking Statements: This news release
contains forward-looking statements. Words such as “anticipates,” “
believes,” “estimates,” “expects,” “intends,” “should,” “will,”
variations of such words and similar expressions are intended to
identify forward-looking statements. These statements reflect
management’s current beliefs as to the expected outcomes of future
events and are not guarantees of future performance. These
statements involve certain risks, uncertainties and assumptions
that are difficult to predict with regard to timing, extent,
likelihood and degree of occurrence. Therefore, actual results and
outcomes may materially differ from what may be expressed or
forecasted in such forward-looking statements. Factors that could
cause a difference in actual results and outcomes include, among
others: the impact of changes in tax law and regulations, including
the Tax Cuts and Jobs Act of 2017; changes in the national and
local economies or market conditions; changes in interest rates,
deposit flows, loan demand and asset quality, including real estate
and other collateral values; changes in banking regulations and
accounting principles, policies or guidelines; the impact of
competition from traditional or new sources; and the impact of
acquisitions, including the risks that (1) the business related to
acquisitions may not be integrated successfully or such integration
may take longer to accomplish than expected; (2) the expected cost
savings and any revenue synergies from acquisitions may not be
fully realized within expected timeframes; and (3) disruption from
acquisitions may make it more difficult to maintain relationships
with clients, associates, or suppliers. These and other factors
that may emerge could cause decisions and actual results to differ
materially from current expectations. The Company undertakes no
obligation to revise, update, or clarify forward-looking statements
to reflect events or conditions after the date of this release.
Note Regarding Use of Non-GAAP Financial Measures: This
news release presents certain non-GAAP financial measures
including, without limitation, adjusted net income, adjusted net
income per share, and tangible book value per share. Non-GAAP
financial measures include numerical measures of a company’s
historical financial performance, financial position, or cash flows
that exclude (or include) amounts, or that are subject to
adjustments that have the effect of excluding (or including)
amounts, that are included (or, as applicable, excluded) in the
most directly comparable measures calculated and presented in
accordance with GAAP. The Company has presented the
adjustments to reconcile from the applicable GAAP financial
measures to the non-GAAP financial measures where applicable.
The Company considers these adjustments to the GAAP financial
measures to be relevant to ongoing operating results. The
Company believes that excluding the amounts associated with these
adjustments to present the non-GAAP financial measures provides a
meaningful base for the period-to-period comparisons, which will
assist investors and analysts in analyzing the operating results or
financial position of the Company. The non-GAAP financial
measures are used by management to assess the performance of the
Company’s business, including for presentations of Company
performance to investors. The Company further believes that
presenting the non-GAAP financial measures will permit investors
and analysts to assess the performance of the Company on the same
basis as that applied by management. Non-GAAP financial
measures have inherent limitations, are not required to be
uniformly applied, and are not audited. Although non-GAAP
financial measures are frequently used by investors to evaluate a
company, they have limitations as an analytical tool and should not
be considered in isolation or as a substitute for analysis of
results reported under GAAP. Reconciliations of non-GAAP
financial measures to the most directly comparable GAAP measures
are included with this release.
Carolina Trust BancShares, Inc. |
Selected Financial HighlightsDollars
in thousands |
|
|
Unaudited |
Unaudited |
Unaudited |
Unaudited |
(a) |
|
12/31/18 |
9/30/18 |
6/30/18 |
3/31/18 |
12/31/17 |
Balance Sheet
Data: |
|
|
|
|
|
Total Assets |
$ |
475,104 |
$ |
465,171 |
$ |
470,854 |
$ |
446,610 |
$ |
406,618 |
Total Loans |
|
393,282 |
|
380,746 |
|
374,026 |
|
367,039 |
|
348,679 |
Allowance for Loan
Loss |
|
3,978 |
|
3,925 |
|
3,844 |
|
3,780 |
|
3,599 |
Total Deposits |
|
395,149 |
|
386,497 |
|
393,279 |
|
372,902 |
|
340,653 |
Total Shareholders’
Equity |
|
50,261 |
|
48,954 |
|
48,201 |
|
29,379 |
|
29,119 |
|
|
|
|
|
|
|
|
|
|
|
- Note: Unless otherwise noted, all financial information
presented in the accompanying tables as of and for the year ending
December 31, 2017, is derived from audited financial
statements.
Carolina Trust BancShares, Inc. |
Comparative Income
StatementsFor the Three Months
EndedDollars in thousands, except share and per share
data |
|
|
Unaudited12/31/18 |
Unaudited12/31/17 |
Variance$ |
Variance% |
Income and Per
Share Data: |
|
|
|
|
Interest Income |
$ |
5,645 |
|
$ |
4,672 |
|
$ |
973 |
|
21 |
% |
Interest Expense |
|
1,233 |
|
|
916 |
|
|
317 |
|
35 |
% |
Net Interest
Income |
|
4,412 |
|
|
3,756 |
|
|
656 |
|
17 |
% |
Provision for (Recovery
of) Loan Loss |
|
(9 |
) |
|
149 |
|
|
(158 |
) |
NM |
|
Net Interest Income
After Provision |
|
4,421 |
|
|
3,607 |
|
|
814 |
|
23 |
% |
Non-interest
Income |
|
186 |
|
|
301 |
|
|
(115 |
) |
(38 |
%) |
Non-interest Expense,
Excluding Merger Expenses |
|
3,093 |
|
|
3,036 |
|
|
57 |
|
2 |
% |
Merger Expenses |
|
264 |
|
|
-0- |
|
|
264 |
|
NM |
|
Income Before
Taxes |
|
1,250 |
|
|
872 |
|
|
378 |
|
43 |
% |
Income Tax Expense |
|
304 |
|
|
1,226 |
|
|
(922 |
) |
76 |
% |
Net Income
(Loss) Available to Common Shareholders |
$ |
946 |
|
$ |
(354 |
) |
$ |
1,300 |
|
NM |
|
|
|
|
|
|
Net Income
(Loss) Per Common Share: |
|
|
|
|
Basic |
$ |
0.13 |
|
$ |
(0.08 |
) |
|
|
Diluted |
$ |
0.13 |
|
$ |
(0.08 |
) |
|
|
Average Common
Shares Outstanding: |
|
|
|
|
Basic |
|
7,156,987 |
|
|
4,657,304 |
|
|
|
Diluted |
|
7,239,698 |
|
|
4,752,961 |
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP MeasureAdjusted Net Income
(Excludes Merger Expenses and Tax Charge for Deferred Tax Asset
(“DTA”) Revaluation):
Income Before Taxes |
$ |
1,250 |
|
$ |
872 |
|
$ |
378 |
|
43 |
% |
Add: Merger Expenses,
Before Income Tax Benefit |
|
264 |
|
|
-0- |
|
|
264 |
|
NM |
|
Adjusted Income Before
Taxes |
|
1,514 |
|
|
872 |
|
|
642 |
|
74 |
% |
Less: Income Tax
Expense |
|
304 |
|
|
1,226 |
|
|
(922 |
) |
NM |
|
Less: Income Tax
Benefit from Merger Expenses |
|
41 |
|
|
-0- |
|
|
41 |
|
NM |
|
Add: Income Tax Charge
for DTA Revaluation |
-0- |
|
|
(936 |
) |
|
936 |
|
NM |
|
Adjusted Net
Income Available to Common Shareholders |
$ |
1,169 |
|
$ |
582 |
|
$ |
587 |
|
101 |
% |
|
|
|
|
|
Adjusted Net
Income Per Common Share: |
|
|
|
|
Basic |
$ |
0.16 |
|
$ |
0.12 |
|
|
|
Diluted |
$ |
0.16 |
|
$ |
0.12 |
|
|
|
Average Common
Shares Outstanding: |
|
|
|
|
Basic |
|
7,156,987 |
|
|
4,657,304 |
|
|
|
Diluted |
|
7,239,698 |
|
|
4,752,961 |
|
|
|
|
|
|
|
|
|
|
|
|
Carolina Trust BancShares,
Inc.Comparative Income
StatementsFor the Year EndedDollars in
thousands, except share and per share data
|
Unaudited |
(a) |
Variance |
Variance |
12/31/18 |
12/31/17 |
$ |
% |
Income and Per
Share Data: |
|
|
|
|
|
Interest Income |
$ |
21,089 |
$ |
17,449 |
$ |
3,640 |
|
21 |
% |
Interest Expense |
|
4,624 |
|
3,479 |
|
1,145 |
|
33 |
% |
Net Interest
Income |
|
16,465 |
|
13,970 |
|
2,495 |
|
18 |
% |
Provision for Loan
Loss |
|
406 |
|
704 |
|
(298 |
) |
(42 |
%) |
Net Interest Income
After Provision |
|
16,059 |
|
13,266 |
|
2,793 |
|
21 |
% |
Non-interest
Income |
|
1,256 |
|
1,033 |
|
223 |
|
22 |
% |
Non-interest Expense,
Excluding Merger Expenses |
|
12,656 |
|
12,301 |
|
355 |
|
3 |
% |
Merger Expenses |
|
744 |
-0- |
|
744 |
|
NM |
|
Income Before
Taxes |
|
3,915 |
|
1,998 |
|
1,917 |
|
96 |
% |
Income Tax Expense |
|
963 |
|
1,594 |
|
(631 |
) |
(40 |
%) |
Net Income
Available to Common Shareholders |
$ |
2,952 |
$ |
404 |
$ |
2,548 |
|
631 |
% |
|
|
|
|
|
|
Net Income Per
Common Share: |
|
|
|
|
|
Basic |
$ |
0.46 |
$ |
0.09 |
|
|
|
Diluted |
$ |
0.46 |
$ |
0.09 |
|
|
|
Average Common
Shares Outstanding: |
|
|
|
|
|
Basic |
|
6,380,227 |
|
4,655,369 |
|
|
|
Diluted |
|
6,470,939 |
|
4,737,874 |
|
|
|
|
|
Non-GAAP Measure |
|
Adjusted Net Income (Excludes Merger Expenses and Tax
Charge for DTA Revaluation): |
|
|
|
Income Before
Taxes |
$ |
3,915 |
$ |
1,998 |
$ |
1,917 |
|
96 |
% |
Add: Merger
Expenses, Before Income Tax Benefit |
|
744 |
-0- |
|
744 |
|
NM |
|
Adjusted Income Before
Taxes |
|
4,659 |
|
1,998 |
|
2,661 |
|
133 |
% |
Less: Income Tax
Expense |
|
963 |
|
1,594 |
|
(631 |
) |
(40 |
%) |
Less: Income Tax
Benefit from Merger Expenses |
|
97 |
-0- |
|
97 |
|
NM |
|
Add: Income Tax
Charge for DTA Revaluation |
-0- |
|
936 |
|
(936 |
) |
NM |
|
Adjusted Net
Income Available to Common Shareholders |
$ |
3,599 |
$ |
1,340 |
$ |
2,259 |
|
169 |
% |
|
|
|
|
|
|
Adjusted Net
Income Per Common Share: |
|
|
|
|
|
Basic |
$ |
0.56 |
$ |
0.29 |
|
|
|
Diluted |
$ |
0.56 |
$ |
0.28 |
|
|
|
Average Common
Shares Outstanding: |
|
|
|
|
|
Basic |
|
6,380,227 |
|
4,655,369 |
|
|
|
Diluted |
|
6,470,939 |
|
4,737,874 |
|
|
|
|
|
|
|
|
|
|
|
Carolina Trust BancShares,
Inc.Quarterly Income
StatementDollars in thousands, except share and
per share data
|
For the three months ended: |
|
Income and Per
Share Data: |
Unaudited |
|
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|
12/31/18 |
|
9/30/18 |
6/30/18 |
3/31/18 |
12/31/17 |
Interest Income |
$ |
5,645 |
|
$ |
5,419 |
$ |
5,198 |
$ |
4,827 |
$ |
4,672 |
|
Interest Expense |
|
1,233 |
|
|
1,176 |
|
1,155 |
|
1,060 |
|
916 |
|
Net Interest
Income |
|
4,412 |
|
|
4,243 |
|
4,043 |
|
3,767 |
|
3,756 |
|
Provision for (Recovery
of) Loan Loss |
|
(9 |
) |
|
75 |
|
88 |
|
252 |
|
149 |
|
Net Interest Income
After Provision |
|
4,421 |
|
|
4,168 |
|
3,955 |
|
3,515 |
|
3,607 |
|
Non-interest
Income |
|
186 |
|
|
374 |
|
366 |
|
330 |
|
301 |
|
Non-interest Expense,
Excluding Merger Expenses |
|
3,093 |
|
|
3,170 |
|
3,297 |
|
3,096 |
|
3,036 |
|
Merger Expenses |
|
264 |
|
|
157 |
|
323 |
|
-0- |
|
-0- |
|
Income Before
Taxes |
|
1,250 |
|
|
1,215 |
|
701 |
|
749 |
|
872 |
|
Income Tax
Expense |
|
304 |
|
|
300 |
|
191 |
|
168 |
|
1,226 |
|
Net Income
(Loss) Available to Common Shareholders |
$ |
946 |
|
$ |
915 |
$ |
510 |
$ |
581 |
$ |
(354 |
) |
|
|
|
|
|
|
|
Net Income
(Loss) Per Common Share: |
|
|
|
|
|
|
Basic |
$ |
0.13 |
|
$ |
0.13 |
$ |
0.08 |
$ |
0.12 |
$ |
(0.08 |
) |
Diluted |
$ |
0.13 |
|
$ |
0.13 |
$ |
0.08 |
$ |
0.12 |
$ |
(0.08 |
) |
Average Common
Shares Outstanding: |
|
|
|
|
|
|
Basic |
|
7,156,987 |
|
|
7,156,987 |
|
6,583,719 |
|
4,660,325 |
|
4,657,304 |
|
Diluted |
|
7,239,698 |
|
|
7,243,875 |
|
6,598,542 |
|
4,764,274 |
|
4,752,961 |
|
|
|
|
|
|
|
|
Non-GAAP Measure |
|
|
Adjusted Net Income (Excludes Merger Expenses and Tax
Charge for DTA Revaluation): |
|
Income Before
Taxes |
$ |
1,250 |
|
$ |
1,215 |
$ |
701 |
$ |
749 |
$ |
872 |
|
Add: Merger Expenses,
Before Income Tax Benefit |
|
264 |
|
|
157 |
|
323 |
|
-0- |
|
-0- |
|
Adjusted Income Before
Taxes |
|
1,514 |
|
|
1,372 |
|
1,024 |
|
749 |
|
872 |
|
Less: Income Tax
Expense |
|
304 |
|
|
300 |
|
191 |
|
168 |
|
1,226 |
|
Less: Income Tax
Benefit from Merger Expenses |
|
41 |
|
|
15 |
|
41 |
|
-0- |
|
-0- |
|
Add: Tax Charge for DTA
Revaluation |
|
-0- |
|
-0- |
|
-0- |
-0- |
|
936 |
|
Adjusted Net
Income Available to Common Shareholders |
$ |
1,169 |
|
$ |
1,057 |
$ |
792 |
$ |
581 |
$ |
582 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income Per Common Share: |
|
Basic |
$ |
0.16 |
|
$ |
0.15 |
$ |
0.12 |
$ |
0.12 |
$ |
0.12 |
|
Diluted |
$ |
0.16 |
|
$ |
0.15 |
$ |
0.12 |
$ |
0.12 |
$ |
0.12 |
|
|
|
|
|
|
|
|
Average Common
Shares Outstanding: |
Basic |
|
7,156,987 |
|
|
7,156,987 |
|
6,583,719 |
|
4,660,325 |
|
4,657,304 |
|
Diluted |
|
7,239,698 |
|
|
7,243,875 |
|
6,598,542 |
|
4,764,274 |
|
4,752,961 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carolina Trust BancShares, Inc. |
Selected Financial Highlights |
Dollars in thousands, except share and per share
data |
|
|
12/31/18 |
9/30/18 |
6/30/18 |
3/31/18 |
12/31/17 |
Capital Ratios: |
|
|
|
|
|
Common
equity tier 1 capital ratio 1 |
|
12.24 |
% |
|
12.21 |
% |
|
12.16 |
% |
|
10.43 |
% |
|
10.10 |
% |
Tier 1
capital ratio 1 |
|
12.24 |
% |
|
12.21 |
% |
|
12.16 |
% |
|
10.43 |
% |
|
10.10 |
% |
Total
capital ratio 1 |
|
13.21 |
% |
|
13.19 |
% |
|
13.14 |
% |
|
11.41 |
% |
|
11.08 |
% |
Tier 1
leverage ratio 1 |
|
10.75 |
% |
|
10.56 |
% |
|
10.45 |
% |
|
9.49 |
% |
|
9.22 |
% |
|
|
|
|
|
|
Tangible
Common Equity (*) |
$ |
50,221 |
|
$ |
48,907 |
|
$ |
48,145 |
|
$ |
29,315 |
|
$ |
29,046 |
|
Common
Shares Outstanding |
|
7,156,987 |
|
|
7,156,987 |
|
|
7,156,987 |
|
|
4,660,987 |
|
|
4,657,880 |
|
Book Value
per Common Share |
$ |
7.02 |
|
$ |
6.84 |
|
$ |
6.73 |
|
$ |
6.30 |
|
$ |
6.25 |
|
Tangible
Book Value per Common Share (*) |
$ |
7.02 |
|
$ |
6.83 |
|
$ |
6.73 |
|
$ |
6.29 |
|
$ |
6.24 |
|
|
|
|
|
|
|
Performance Ratios for the Three Months Ended
(annualized): |
|
|
|
|
|
Return on
Average Assets |
|
0.80 |
% 2 |
|
0.78 |
% 3 |
|
0.44 |
% 4 |
|
0.55 |
% |
|
(0.35 |
%)
5 |
Return on
Average Common Equity |
|
7.54 |
% 2 |
|
7.42 |
% 3 |
|
4.69 |
% 4 |
|
8.00 |
% |
|
(4.71 |
%)
5 |
Net
Interest Margin |
|
3.94 |
% |
|
3.82 |
% |
|
3.76 |
% |
|
3.79 |
% |
|
3.91 |
% |
|
|
|
|
|
|
Asset Quality: |
|
|
|
|
|
Delinquent
Loans (30-89 days accruing interest) |
$ |
459 |
|
$ |
754 |
|
$ |
957 |
|
$ |
430 |
|
$ |
649 |
|
|
|
|
|
|
|
Delinquent
Loans (90 days or more and accruing) |
|
5 |
|
|
-0- |
|
|
25 |
|
|
-0- |
|
|
82 |
|
Non-accrual
Loans |
|
1,046 |
|
|
1,057 |
|
|
1,080 |
|
|
1,125 |
|
|
2,664 |
|
OREO and
Repossessed property |
|
1,157 |
|
|
1,782 |
|
|
1,971 |
|
|
2,215 |
|
|
789 |
|
Total
Nonperforming Assets |
$ |
2,208 |
|
$ |
2,839 |
|
$ |
3,076 |
|
$ |
3,340 |
|
$ |
3,453 |
|
|
|
|
|
|
|
Restructured Loans |
$ |
3,856 |
|
$ |
3,925 |
|
$ |
4,006 |
|
$ |
4,096 |
|
$ |
4,163 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonperforming Assets / Total Assets |
|
0.46 |
% |
|
0.61 |
% |
|
0.65 |
% |
|
0.75 |
% |
|
0.87 |
% |
Nonperforming Assets / Equity & Allowance for Loan Loss |
|
4.07 |
% |
|
5.37 |
% |
|
5.91 |
% |
|
10.07 |
% |
|
10.75 |
% |
Allowance
for Loan Loss / Nonperforming Assets |
|
180.14 |
% |
|
138.29 |
% |
|
124.94 |
% |
|
113.15 |
% |
|
101.80 |
% |
Allowance
for Loan Loss / Total Loans |
|
1.01 |
% |
|
1.03 |
% |
|
1.03 |
% |
|
1.03 |
% |
|
1.03 |
% |
Net Loan
Charge-offs (Recoveries) |
$ |
(62 |
) |
$ |
(6 |
) |
$ |
23 |
|
$ |
71 |
|
$ |
(26 |
) |
Net Loan
Charge-offs (Recoveries) /Average Loans (annualized) |
|
(0.06 |
%) |
|
(0.01 |
%) |
|
0.03 |
% |
|
0.08 |
% |
|
(0.03 |
%) |
Note:
Financial information is unaudited. |
|
|
|
|
|
|
|
|
|
|
|
1 Note: Capital ratios are presented for Carolina Trust
Bank which reports these ratios to the Federal Financial
Institutions Examination Council on form FFIEC 051.2 Note:
For the three months ended December 31, 2018, excluding merger
expenses, net of tax, would result in an ROA of 0.99% and an ROE of
9.32%. 3 Note: For the three months ended September 30, 2018,
excluding merger expenses, net of tax, would result in an ROA of
0.90% and an ROE of 8.57%. 4 Note: For the three months ended
June 30, 2018, excluding merger expenses, net of tax, would result
in an ROA of 0.69% and an ROE of 7.29%.5 Note: For the three
months ended December 31, 2017, excluding the impact of the
deferred tax asset revaluation from the Tax Cuts and Jobs Act would
result in ROA of 0.57% and an ROE of 7.68%.
|
|
|
|
|
|
(*)
Note |
|
|
|
|
|
Reconciliation of GAAP to non-GAAP: |
12/31/18 |
9/30/18 |
6/30/18 |
3/31/18 |
12/31/17 |
Shareholders’
equity (GAAP) |
$ |
50,261 |
$ |
48,954 |
$ |
48,201 |
$ |
29,379 |
$ |
29,119 |
Less: Core deposit intangible |
|
40 |
|
47 |
|
56 |
|
64 |
|
73 |
Tangible Common Equity (non-GAAP) |
|
50,221 |
|
48,907 |
|
48,145 |
|
29,315 |
|
29,046 |
Common Shares Outstanding |
|
7,156,987 |
|
7,156,987 |
|
7,156,987 |
|
4,660,987 |
|
4,657,880 |
Tangible Book Value per Common Share (non-GAAP) |
$ |
7.02 |
$ |
6.83 |
$ |
6.73 |
$ |
6.29 |
$ |
6.24 |
|
|
|
|
|
|
|
|
|
|
|
1 Note from Page 2 Pre-tax pre-provision
return on assets
Dollars in
Thousands |
|
|
Reconciliation
of GAAP to non-GAAP: |
|
4Q18 |
|
|
|
4Q17 |
|
Net income (loss) |
$ |
946 |
|
|
$ |
(354 |
) |
Income tax expense |
|
304 |
|
|
|
1,226 |
|
Pre-tax income |
|
1,250 |
|
|
|
872 |
|
Provision for (recovery
of) loan loss |
|
(9 |
) |
|
|
149 |
|
Pre-tax pre-provision
income |
$ |
1,241 |
|
|
$ |
1,021 |
|
|
|
Average assets |
$ |
469,480 |
|
|
$ |
406,191 |
|
Pre-tax pre-provision
return on assets |
|
1.05 |
% |
|
|
1.00 |
% |
|
|
|
|
|
|
|
|
Contact:Jerry L. OcheltreePresident and CEOCarolina Trust
BancShares, Inc.(704) 735-1104
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