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 March 31, 2019 (“1Q19”), the Company’s net income was
$337,000 or $0.04 per diluted share as compared to $581,000 or
$0.12 per diluted share in the quarter ended March 31, 2018
(“1Q18”), a decrease of $244,000 or $0.08 per diluted share.
The diluted average common shares outstanding increased to 9.4
million shares in 1Q19 from 4.8 million shares in 1Q18 following
the completion of the Company’s stock offering in the second
quarter of 2018 and an acquisition on January 1, 2019, which is
discussed below.
On January 1, 2019, the Company completed its previously
announced merger with Clover Community Bankshares, Inc. (“Clover”),
parent company of Clover Community Bank. Also under the
merger agreement, Clover Community Bank merged with Carolina Trust
Bank (the “Bank”), the wholly owned banking subsidiary of the
Company. Pursuant to the merger agreement, each share of
Clover common stock and preferred stock was converted into
the right to receive, at the election of each Clover shareholder,
either 2.7181 shares of Company common stock or $22.00 in cash,
subject to proration procedures that resulted in an aggregate 80%
stock and 20% cash consideration mix. Total consideration was
$20.4 million in stock and cash. Overall, the Company issued
2,123,858 shares of common stock in exchange for 80% of Clover’s
shares and paid $3,008 in lieu of fractional Company shares.
Cash consideration paid in exchange for 20% of Clover’s shares
totaled $4,298,360. The stock consideration was valued at
$7.58 per share, the most recent closing price at the effective
time of the merger. In accordance with the merger agreement,
cash paid in lieu of fractional shares was valued at a rate of
$7.6305 per share, the average of the closing sales prices of the
Company’s common stock as reported on Nasdaq for the twenty
consecutive full trading days ending on the trading day immediately
prior to the closing date of the merger. The fair market
value of loans and deposits acquired on the merger date was $64
million and $112 million, respectively. The Bank recorded
$5.4 million in goodwill, reflecting the amount of consideration
given in excess of the fair market value of net assets
acquired. In addition, the Bank recognized $3.2 million in
core deposit intangibles, the premium recognized for Clover
Community Bank’s deposits, which is amortized over the estimated
life of those deposits.
During 1Q19 the Company incurred $1,722,000 in merger-related
expenses. If the merger expenses, and certain other income
statement items including accretion of premiums recorded on loans
and deposits and amortization of the core deposit intangibles, net
of tax, were excluded, net income for 1Q19 would have been
$1,710,000 or $0.18 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
1Q19 and 1Q18.
$ in thousands |
For the 3 months ended |
|
|
|
March 31,2019 |
March 31,2018 |
Increase(Decrease) |
% Change |
Interest
income |
$ |
7,080 |
|
$ |
4,827 |
|
$ |
2,253 |
|
47 |
% |
Interest expense |
|
1,422 |
|
|
1,060 |
|
|
362 |
|
34 |
% |
Net interest income |
|
5,658 |
|
|
3,767 |
|
|
1,891 |
|
50 |
% |
Provision for (recovery of) loan loss |
|
77 |
|
|
252 |
|
|
(175 |
) |
(69 |
%) |
Noninterest income |
|
620 |
|
|
330 |
|
|
290 |
|
88 |
% |
Noninterest expense, excluding merger expenses |
|
4,069 |
|
|
3,096 |
|
|
973 |
|
31 |
% |
Merger expenses |
|
1,722 |
|
|
-0- |
|
|
1,722 |
|
NM |
|
Pre-tax income |
|
410 |
|
|
749 |
|
|
(339 |
) |
(45 |
%) |
Income tax expense |
|
73 |
|
|
168 |
|
|
(95 |
) |
(57 |
%) |
Net income (loss) |
$ |
337 |
|
$ |
581 |
|
$ |
(244 |
) |
(42 |
%) |
|
|
|
|
|
Non-GAAP measurements: |
|
|
|
|
Net income (loss) |
$ |
337 |
|
$ |
581 |
|
|
|
Adjustments: |
|
|
|
|
+ Merger expenses |
|
1,722 |
|
|
- |
|
|
|
- Accretion of purchased loan discounts |
|
(117 |
) |
|
(2 |
) |
|
|
- Accretion of purchased time deposit discounts |
|
12 |
|
|
- |
|
|
|
+ Amortization of core deposit intangible |
|
161 |
|
|
9 |
|
|
|
- Net tax effect of adjustments |
|
(405 |
) |
|
(1 |
) |
|
|
= Adjusted net income |
$ |
1,710 |
|
$ |
587 |
|
$ |
1,123 |
|
191 |
% |
|
|
|
|
|
Return on assets |
|
0.23 |
% |
|
0.55 |
% |
|
(0.32 |
%) |
|
Return on equity |
|
2.05 |
% |
|
8.00 |
% |
|
(5.95 |
%) |
|
Net interest margin |
|
4.09 |
% |
|
3.79 |
% |
|
0.30 |
% |
|
Efficiency ratio 1 |
|
92 |
% |
|
76 |
% |
|
16 |
% |
|
Adjusted return on assets 2 |
|
1.14 |
% |
|
0.55 |
% |
|
0.59 |
% |
|
Adjusted return on equity 2 |
|
10.41 |
% |
|
8.07 |
% |
|
2.34 |
% |
|
Adjusted net interest margin 2 |
|
4.01 |
% |
|
3.79 |
% |
|
0.22 |
% |
|
Adjusted efficiency ratio 2 |
|
63 |
% |
|
75 |
% |
|
(9 |
%) |
|
Average assets |
$ |
607,689 |
|
$ |
430,727 |
|
$ |
176,962 |
|
41 |
% |
Average loans |
|
464,755 |
|
|
360,518 |
|
|
104,237 |
|
29 |
% |
Average deposits |
|
509,091 |
|
|
357,259 |
|
|
151,832 |
|
42 |
% |
Average equity 3 |
|
66,593 |
|
|
29,475 |
|
|
37,118 |
|
126 |
% |
Book value per share as of the end of the period |
$ |
7.25 |
|
$ |
6.30 |
|
|
|
Tangible book value per share as of the end of the Period |
$ |
6.34 |
|
$ |
6.29 |
|
|
|
|
|
|
|
|
|
|
|
|
1 Efficiency ratio = Noninterest expense / (Net interest income
+ Noninterest income)2 Adjusted returns on assets and equity,
adjusted net interest margin and adjusted efficiency ratios are
non-GAAP measures. A reconciliation to GAAP is included at
the end of this release.3 Note: The common stock offering
completed in April 2018 added $18.4 million to common equity.
The acquisition of Clover in January 2019 added $16.1 million to
common equity
Comparing 1Q19 with 1Q18, the $339,000 (-45%) decrease in
pre-tax income was due mostly to merger expenses mentioned
previously and to a $973,000 (+31%) increase in noninterest
expenses, excluding merger expenses. These unfavorable
comparisons were offset by an increase in net interest income of
$1,891,000 (+50%), an increase in noninterest income of $290,000
(+88%) and a decrease in loan loss provision of $175,000
(-69%). Income tax expense decreased by $95,000 (-57%) as a
result of the decrease in pre-tax income.
Net interest income increased from $3,767,000 in 1Q18 to
$5,658,000 in 1Q19, primarily due to the loan and deposit growth
from the acquisition of Clover and, secondarily, to loan growth in
existing branches. Average loans increased by $104 million,
or 29%, from 1Q18 to 1Q19 and included $64 million acquired from
Clover. The remaining $40 million in year-over-year average
loan growth was concentrated in the Mooresville and Hickory offices
and the Salisbury loan production office, which combined for $34
million of the growth, followed by the Denver and Forest City
offices with growth totaling $8 million. The offices with the
highest average loan balances in 1Q19 were Gastonia ($83 million),
Mooresville ($78 million), Hickory ($72 million), and Lincolnton
Main ($68 million).
The net interest margin increased by 30 basis points from 3.79%
in 1Q18 to 4.09% in 1Q19. The yield on earning assets
increased by 25 basis points from 4.86% in 1Q18 to 5.11% in
1Q19. Comparatively, the cost of funds, including deposits,
borrowings and holding company debt, was flat at 1.08% from 1Q18 to
1Q19. 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 89% in 1Q18 to 83% in 1Q19. The additional
liquidity maintained in interest earning cash and securities
resulted in those categories increasing from 11% to 17% as a
percentage of earning assets for the same periods.
The margin and asset yield increases were attributed primarily
to the 45 basis point increase in loan yield from 5.15% in 1Q18 to
5.60% in 1Q19. Loan yields were positively
impacted by prime rate increases of 25 basis points each in March
2018, June 2018, September 2018, and December 2018. The loan
yields also benefited from accretion of the discounts on purchased
loans and were partially offset by accretion of the discounts on
acquired time deposits. The net of loan and deposit accretion added
8 basis points to the net interest margin.
In a linked quarter comparison, the net interest margin improved
by 15 basis points from 3.94% in 4Q18 to 4.09% in 1Q19. The
earning asset yield grew by 6 basis points as compared to the cost
of funds that decreased by 10 basis points. The earning asset
yield increase from 4Q18 to 1Q19 was attributable to the loan yield
growing by 19 basis points and the investment yield increasing by
16 basis points, which more than offset the lower percentage of
loans to earning assets in 1Q19.
Noninterest income increased by $290,000 from $330,000 in 1Q18
to $620,000 in 1Q19. The increase was due mostly to mortgage
fee income increasing by $110,000 or 733%, overdraft fees
increasing by $60,000 or 43% and a $34,000 or 74% increase in
interchange fee income. Gains on securities increased by
$30,000 as the value of equity holdings appreciated. The
growth in mortgage fee income result was partially attributed to
experienced mortgage specialists who were previously with Clover
and to a renewed emphasis to meeting the demand for mortgages in
Bank’s markets. Overdraft fees and interchange fees increased
as a result of an increase in the Bank’s checking account customer
base for which the average total balance grew by 68% from 1Q18 to
1Q19, primarily due to the acquisition of Clover.
Noninterest expense increased by $2,695,000 (+87%), from
$3,096,000 in 1Q18 to $5,791,000 in 1Q19. This increase
included merger expenses for the acquisition of Clover, which
totaled $1,722,000 in 1Q19 as compared to $0 in 1Q18. There
were smaller increases in salaries and benefits, up $556,000
(+30%), and in amortization of core deposit intangibles, up
$152,000 (+1,689%), both of which were attributed primarily to the
acquisition of Clover. Merger expenses included $1,224,000
paid to former Clover employees in accordance with
change-in-control agreements or severance packages and the related
payroll taxes. The other merger expenses included $242,000 for data
processing due to the system conversion to the Bank’s core system
and processes and $173,000 due to various products and services
including investment banking services, debit cards and product
brochure for previous Clover customers, and training for former
Clover employees. Salaries and wages were up by $463,000 or
36%, as new employees joined the Bank in conjunction with the
acquisition of Clover. This increase included $52,000 for
several employees whose employment ended as planned after
conversion of Clover’s operating system to the Bank’s operating
system in mid-February. Overtime salaries were up $21,000 or
141% from 1Q18 to 1Q19, which was in part due to the effort to
convert Clover to the Bank’s core system and processes.
Comparison of Financial Condition at March 31, 2019 with
December 31, 2018.
The balance sheet growth from December 31, 2018 to March 31,
2019 was mostly attributed to the acquisition of Clover.
Assets increased by $146 million (+31%) from December 31, 2018 to
March 31, 2019, as funding from deposits increased by $128 million
(+32%), and shareholders’ equity grew by $17 million (+34%).
The asset growth was concentrated in loans, up $81 million
(+21%). Investment securities increased by $37 million
(+114%). Cash and due from banks increased $3 million (+24%),
and interest-earning deposits with banks increased by $8 million
(+37%). Intangible assets increased by $9 million (+20,629%),
and foreclosed assets increased by $1 million (+89%).
The increase in loans since December 31, 2018 included $64
million acquired from Clover on the merger date, January 1, 2019,
and $17 million in additional growth. The increase in
deposits included $112 million acquired from Clover on the
merger date and $16 million in net growth during the first quarter
of 2019.
Asset quality measurements remained strong during the first
quarter of 2019. The ratio of non-performing assets to total
assets was 0.52% on March 31, 2019 as compared to 0.46% on December
31, 2018. Nonperforming loans to total loans improved by 5
basis points to 0.22% at March 31, 2019. Net recoveries to average
loans on an annualized basis was (0.01%) for the quarters ended
March 31, 2019 and December 31, 2018, and the net charge offs to
average loans on annualized basis for the quarter ended March 31,
2018 was 0.08%.
Regulatory capital ratios for the Company’s wholly owned
subsidiary, Carolina Trust Bank, decreased slightly from December
31, 2018 to March 31, 2019. The growth in risk-weighted
assets was slightly more than additional risk-based capital from
the Clover acquisition and first quarter earnings. The Bank’s
total risk-based capital ratio at March 31, 2019 was 13.25%, a 9
basis-point decrease from 13.34% at December 31, 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 eleven full-service offices and one
loan production office in the Piedmont and Mountain Regions of the
Carolinas to the north and 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 |
(a) |
Unaudited |
Unaudited |
Unaudited |
|
3/31/19 |
12/31/18 |
9/30/18 |
6/30/18 |
3/31/18 |
Balance Sheet
Data: |
|
|
|
|
|
Total Assets |
$621,279 |
|
$475,104 |
|
$465,171 |
|
$470,854 |
|
$446,610 |
|
Total Loans |
|
474,239 |
|
|
393,282 |
|
|
380,746 |
|
|
374,026 |
|
|
367,039 |
|
Allowance for Loan
Loss |
|
4,069 |
|
|
3,978 |
|
|
3,925 |
|
|
3,844 |
|
|
3,780 |
|
Total Deposits |
|
523,390 |
|
|
395,149 |
|
|
386,497 |
|
|
393,279 |
|
|
372,902 |
|
Total Shareholders’
Equity |
|
67,378 |
|
|
50,261 |
|
|
48,954 |
|
|
48,201 |
|
|
29,379 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Unless otherwise noted, all financial information
presented in the accompanying tables as of and for the year ending
December 31, 2018, is derived from audited financial
statements.
|
Carolina Trust BancShares, Inc. |
Comparative Income StatementsFor the
Three Months EndedDollars in thousands, except share and
per share data |
|
|
Unaudited3/31/19 |
Unaudited3/31/18 |
Variance$ |
Variance % |
Income and Per
Share Data: |
|
|
|
|
Interest Income |
$ |
7,080 |
|
$ |
4,827 |
|
$ |
2,253 |
|
47 |
% |
Interest Expense |
|
1,422 |
|
|
1,060 |
|
|
362 |
|
34 |
% |
Net Interest Income |
|
5,658 |
|
|
3,767 |
|
|
1,891 |
|
50 |
% |
Provision for (Recovery
of) Loan Loss |
|
77 |
|
|
252 |
|
|
(175 |
) |
(69 |
%) |
Net Interest Income After
Provision |
|
5,581 |
|
|
3,515 |
|
|
2,066 |
|
59 |
% |
Non-interest Income |
|
620 |
|
|
330 |
|
|
290 |
|
88 |
% |
Non-interest Expense,
Excluding Merger Expenses |
|
4,069 |
|
|
3,096 |
|
|
973 |
|
31 |
% |
Merger Expenses |
|
1,722 |
|
|
-0- |
|
|
1,722 |
|
NM |
|
Income Before Taxes |
|
410 |
|
|
749 |
|
|
(339 |
) |
(45 |
%) |
Income Tax Expense |
|
73 |
|
|
168 |
|
|
(95 |
) |
(57 |
%) |
Net Income (Loss)
Available to Common Shareholders |
$ |
337 |
|
$ |
581 |
|
($ |
244 |
) |
(42 |
%) |
|
|
|
|
|
Net Income (Loss)
Per Common Share: |
|
|
|
|
Basic |
$ |
0.04 |
|
$ |
0.12 |
|
|
|
Diluted |
$ |
0.04 |
|
$ |
0.12 |
|
|
|
Average Common
Shares Outstanding: |
|
|
|
|
Basic |
|
9,290,811 |
|
|
4,660,325 |
|
|
|
Diluted |
|
9,361,612 |
|
|
4,764,274 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carolina Trust BancShares, Inc. |
|
Quarterly Income Statement |
|
Dollars in thousands, except share and per share
data |
|
|
|
|
For the three months ended: |
Income and Per
Share Data: |
Unaudited3/31/19 |
Unaudited12/31/18 |
Unaudited9/30/18 |
Unaudited6/30/18 |
Unaudited3/31/18 |
Interest Income |
$ |
7,080 |
|
$ |
5,645 |
|
$ |
5,419 |
|
$ |
5,198 |
|
$ |
4,827 |
|
Interest Expense |
|
1,422 |
|
|
1,233 |
|
|
1,176 |
|
|
1,155 |
|
|
1,060 |
|
Net Interest Income |
|
5,658 |
|
|
4,412 |
|
|
4,243 |
|
|
4,043 |
|
|
3,767 |
|
Provision for (Recovery
of) Loan Loss |
|
77 |
|
|
(9 |
) |
|
75 |
|
|
88 |
|
|
252 |
|
Net Interest Income After
Provision |
|
5,581 |
|
|
4,421 |
|
|
4,168 |
|
|
3,955 |
|
|
3,515 |
|
Non-interest Income |
|
620 |
|
|
186 |
|
|
374 |
|
|
366 |
|
|
330 |
|
Non-interest Expense,
Excluding Merger Expenses |
|
4,069 |
|
|
3,093 |
|
|
3,170 |
|
|
3,297 |
|
|
3,096 |
|
Merger Expenses |
|
1,722 |
|
|
264 |
|
|
157 |
|
|
323 |
|
-0- |
|
Income Before Taxes |
|
410 |
|
|
1,250 |
|
|
1,215 |
|
|
701 |
|
|
749 |
|
Income Tax Expense |
|
73 |
|
|
304 |
|
|
300 |
|
|
191 |
|
|
168 |
|
Net Income (Loss)
Available to Common Shareholders |
$ |
337 |
|
$ |
946 |
|
$ |
915 |
|
$ |
510 |
|
$ |
581 |
|
|
|
|
|
|
|
|
Net Income (Loss)
Per Common Share: |
|
|
|
|
|
|
Basic |
$ |
0.04 |
|
$ |
0.13 |
|
$ |
0.13 |
|
$ |
0.08 |
|
$ |
0.12 |
|
Diluted |
$ |
0.04 |
|
$ |
0.13 |
|
$ |
0.13 |
|
$ |
0.08 |
|
$ |
0.12 |
|
Average Common
Shares Outstanding: |
|
|
|
|
|
|
Basic |
|
9,290,811 |
|
|
7,156,987 |
|
|
7,156,987 |
|
|
6,583,719 |
|
|
4,660,325 |
|
Diluted |
|
9,361,612 |
|
|
7,239,698 |
|
|
7,243,875 |
|
|
6,598,542 |
|
|
4,764,274 |
|
Non-GAAP MeasureAdjusted Net Income
(excludes accretion of purchased loan discounts and purchased time
deposit discounts, amortization of core deposit intangibles, and
merger expenses, adjusted for the effect of income
taxes): |
Income Before Taxes |
$ |
410 |
|
$ |
1,250 |
|
$ |
1,215 |
|
$ |
701 |
|
$ |
749 |
|
Less: Accretion of
purchased loan Discount |
|
(117 |
) |
|
(1 |
) |
|
(2 |
) |
|
(2 |
) |
|
(2 |
) |
Add: Accretion of
purchased time deposit discounts |
|
12 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Add: Amortization of
core deposit Intangibles |
|
161 |
|
|
7 |
|
|
9 |
|
|
9 |
|
|
9 |
|
Add: Merger
Expenses |
|
1,722 |
|
|
264 |
|
|
157 |
|
|
323 |
|
|
- |
|
Adjusted Income Before
Taxes |
|
2,188 |
|
|
1,520 |
|
|
1,379 |
|
|
1,031 |
|
|
756 |
|
Less: Income Tax
Expense |
|
73 |
|
|
304 |
|
|
300 |
|
|
191 |
|
|
168 |
|
Less: Income Tax Effect of
Adjustments |
|
405 |
|
|
43 |
|
|
17 |
|
|
43 |
|
|
1 |
|
Adjusted Net
Income Available to Common Shareholders |
$ |
1,710 |
|
$ |
1,173 |
|
$ |
1,062 |
|
$ |
797 |
|
$ |
587 |
|
Adjusted Net Income Per Common Share: |
Basic |
$ |
0.18 |
|
$ |
0.16 |
|
$ |
0.15 |
|
$ |
0.12 |
|
$ |
0.13 |
|
Diluted |
$ |
0.18 |
|
$ |
0.16 |
|
$ |
0.15 |
|
$ |
0.12 |
|
$ |
0.12 |
|
Average Common
Shares Outstanding: |
|
|
|
|
|
Basic |
|
9,290,811 |
|
|
7,156,987 |
|
|
7,156,987 |
|
|
6,583,719 |
|
|
4,660,325 |
|
Diluted |
|
9,361,612 |
|
|
7,239,698 |
|
|
7,243,875 |
|
|
6,598,542 |
|
|
4,764,274 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carolina Trust BancShares, Inc. |
Selected Financial Highlights |
Dollars in thousands, except share and per share data |
|
|
3/31/19 |
12/31/18 |
9/30/18 |
6/30/18 |
3/31/18 |
Capital Ratios: |
|
|
|
|
|
Common equity tier 1
capital ratio 1 |
12.45 |
% |
12.36 |
% |
12.21 |
% |
12.16 |
% |
10.43 |
% |
Tier 1 capital
ratio 1 |
12.45 |
% |
12.36 |
% |
12.21 |
% |
12.16 |
% |
10.43 |
% |
Total capital
ratio 1 |
13.25 |
% |
13.34 |
% |
13.19 |
% |
13.14 |
% |
11.41 |
% |
Tier 1
leverage ratio 1 |
10.64 |
% |
10.85 |
% |
10.56 |
% |
10.45 |
% |
9.49 |
% |
|
|
|
|
|
|
Tangible
Common Equity (*) |
$58,983 |
|
$50,221 |
|
$48,907 |
|
$48,145 |
|
$29,315 |
|
Common Shares
Outstanding |
9,296,977 |
|
7,156,987 |
|
7,156,987 |
|
7,156,987 |
|
4,660,987 |
|
Book Value per
Common Share |
$7.25 |
|
$7.02 |
|
$6.84 |
|
$6.73 |
|
$6.30 |
|
Tangible Book
Value per Common Share (*) |
$6.34 |
|
$7.02 |
|
$6.83 |
|
$6.73 |
|
$6.29 |
|
|
|
|
|
|
|
|
|
|
|
|
Performance Ratios for the Three Months Ended
(annualized): |
|
|
|
|
|
Return on
Average Assets |
0.23 |
% 2 |
0.80 |
% 3 |
0.78 |
% 4 |
0.44 |
% 5 |
0.55 |
% 6 |
Return on
Average Common Equity |
2.05 |
% 2 |
7.54 |
% 3 |
7.42 |
% 4 |
4.69 |
% 5 |
8.00 |
% 6 |
Net Interest
Margin |
4.09 |
% |
3.94 |
% |
3.82 |
% |
3.76 |
% |
3.79 |
% |
|
|
|
|
|
|
Asset
Quality: |
|
|
|
|
|
Delinquent
Loans (30-89 days accruing interest) |
$ 819 |
|
$ 459 |
|
$ 754 |
|
$ 957 |
|
$ 430 |
|
|
|
|
|
|
|
Delinquent
Loans (90 days or more and accruing) |
1 |
|
5 |
|
-0- |
|
25 |
|
-0- |
|
Non-accrual
Loans |
1,034 |
|
1,046 |
|
1,057 |
|
1,080 |
|
1,125 |
|
OREO and
Repossessed property |
2,190 |
|
1,157 |
|
1,782 |
|
1,971 |
|
2,215 |
|
Total
Nonperforming Assets |
3,225 |
|
$2,208 |
|
$2,839 |
|
$3,076 |
|
$3,340 |
|
|
|
|
|
|
|
Restructured
Loans |
$3,755 |
|
$3,856 |
|
$3,925 |
|
$4,006 |
|
$4,096 |
|
Nonperforming
Assets / Total Assets |
0.52 |
% |
0.46 |
% |
0.61 |
% |
0.65 |
% |
0.75 |
% |
Nonperforming
Assets / Equity & Allowance for Loan Loss |
4.51 |
% |
4.07 |
% |
5.37 |
% |
5.91 |
% |
10.07 |
% |
Allowance for
Loan Loss / Nonperforming Assets |
126 |
% |
180 |
% |
138 |
% |
125 |
% |
113 |
% |
Allowance for
Loan Loss / Total Loans |
0.86 |
% |
1.01 |
% |
1.03 |
% |
1.03 |
% |
1.03 |
% |
Net Loan
Charge-offs (Recoveries) |
($14 |
) |
($62 |
) |
($6 |
) |
$23 |
|
$71 |
|
Net Loan
Charge-offs (Recoveries) /Average Loans (annualized) |
(0.01 |
%) |
(0.06 |
%) |
(0.01 |
%) |
0.03 |
% |
0.08 |
% |
|
|
|
|
|
|
Purchased
Credit Impaired Loans (gross) |
$4,000 |
|
-0- |
|
-0- |
|
-0- |
|
-0- |
|
Discount on
Purchased Credit Impaired Loans |
673 |
|
-0- |
|
-0- |
|
-0- |
|
-0- |
|
Purchased
Credit Impaired Loan (carrying value) |
3,327 |
|
-0- |
|
-0- |
|
-0- |
|
-0- |
|
|
|
|
|
|
|
|
|
|
|
Purchased
Non-Credit Impaired Loans (gross) |
$55,798 |
|
-0- |
|
-0- |
|
-0- |
|
-0- |
|
Discount on
Purchased Non-Credit Impaired Loans |
857 |
|
-0- |
|
-0- |
|
-0- |
|
-0- |
|
Purchased
Non-Credit Impaired Loans (carrying value) |
54,941 |
|
-0- |
|
-0- |
|
-0- |
|
-0- |
|
Note:
Financial information is unaudited. |
|
|
|
|
|
|
|
|
|
|
|
1 Capital ratios are presented for Carolina Trust Bank
which reports these ratios to the Federal Financial Institutions
Examination Council on form FFIEC 051.2 For the three months ended
March 31, 2019, excluding merger expenses, accretion of discounts
on purchased loans and time deposits, and amortization of core
deposit intangibles, all net of tax, would result in an annualized
ROA of 1.14% and an annualized ROE of 10.41%.3 For the three
months ended December 31, 2018, excluding merger expenses,
accretion of purchased loan discounts and amortization of core
deposit intangibles, net of tax, would result in an annualized ROA
of 0.99% and an annualized ROE of 9.35%. 4 For the three
months ended September 30, 2018, excluding merger expenses,
accretion of purchased loan discounts and amortization of core
deposit intangibles, net of tax, would result in an annualized ROA
of 0.90% and an annualized ROE of 8.61%. 5 For the three
months ended June 30, 2018, excluding merger expenses, accretion of
purchased loan discounts and amortization of core deposit
intangibles, net of tax, would result in an annualized ROA of 0.69%
and an annualized ROE of 7.34%.6 For the three months ended
March 31, 2018, excluding accretion of purchased loan discounts and
amortization of core deposit intangibles, net of tax, would result
in an annualized ROA of 0.55% and an annualized ROE of 8.07%.
|
|
|
|
|
|
|
|
(*) |
|
|
|
|
|
|
|
Reconciliation of GAAP to
non-GAAP (Dollars in Thousands, except share and per share
data): |
3/31/19 |
12/31/18 |
9/30/18 |
6/30/18 |
3/31/18 |
Shareholders’ equity
(GAAP) |
$67,378 |
|
$50,261 |
|
$48,954 |
|
$48,201 |
|
$29,379 |
|
Less:
Goodwill |
|
5,355 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Less: Core deposit intangible |
|
3,039 |
|
|
40 |
|
|
47 |
|
|
56 |
|
|
64 |
|
Tangible Common Equity (non-GAAP) |
|
58,984 |
|
|
50,221 |
|
|
48,907 |
|
|
48,145 |
|
|
29,315 |
|
Common Shares Outstanding |
|
9,296,977 |
|
|
7,156,987 |
|
|
7,156,987 |
|
|
7,156,987 |
|
|
4,660,987 |
|
Tangible Book Value per Common Share (non-GAAP) |
$6.34 |
|
$7.02 |
|
$6.83 |
|
$6.73 |
|
$6.29 |
|
1 Note from Page 2 |
|
|
Dollars in
Thousands |
|
|
Reconciliation
of GAAP to non-GAAP: |
1Q19 |
1Q18 |
Net income (loss) |
$ |
337 |
|
|
$ |
581 |
|
Less: Accretion
of purchased loan discounts |
|
(117 |
) |
|
|
(2 |
) |
Add: Accretion of
purchased time deposit discounts |
|
12 |
|
|
|
- |
|
Add: Amortization
of core deposit intangibles |
|
161 |
|
|
|
9 |
|
Add: Merger
expenses |
|
1,722 |
|
|
|
- |
|
Tax effect of
adjustments |
|
(405 |
) |
|
|
(1 |
) |
Adjusted net
income |
$ |
1,710 |
|
|
$ |
587 |
|
|
|
|
Average diluted
shares |
|
9,361,612 |
|
|
|
4,764,274 |
|
Adjusted diluted
earnings per share |
$ |
0.18 |
|
|
$ |
0.12 |
|
|
|
|
Average assets |
$ |
607,689 |
|
|
$ |
430,727 |
|
Adjusted return on
assets (annualized) |
|
1.14 |
% |
|
|
0.55 |
% |
|
|
|
Average equity |
$ |
66,593 |
|
|
$ |
29,475 |
|
Adjusted return on
equity (annualized) |
|
10.41 |
% |
|
|
8.07 |
% |
|
|
|
Net interest
income |
$ |
5,658 |
|
|
$ |
3,767 |
|
Less: Accretion
of purchased loan discounts |
|
(117 |
) |
|
|
(1 |
) |
Add: Accretion of
purchased time deposit discounts |
|
12 |
|
|
|
- |
|
Adjusted net interest
income |
$ |
5,553 |
|
|
$ |
3,766 |
|
Average earning
assets |
|
561,608 |
|
|
|
402,918 |
|
Adjusted net interest
margin (annualized) |
|
4.01 |
% |
|
|
3.79 |
% |
|
|
|
Noninterest
expenses |
$ |
5,791 |
|
|
$ |
3,096 |
|
Less: Amortization of
core deposit intangibles |
|
(161 |
) |
|
|
- |
|
Less: Merger
expenses |
|
(1,722 |
) |
|
|
(9 |
) |
Adjusted noninterest
expenses (a) |
|
3,908 |
|
|
|
3,087 |
|
|
|
|
|
|
|
Adjusted net interest
income (see above) |
|
5,553 |
|
|
|
3,766 |
|
Noninterest income |
|
620 |
|
|
|
330 |
|
Adjusted net revenues
(b) |
|
6,173 |
|
|
|
4,096 |
|
Adjusted efficiency
ratio = (a) / (b) |
|
63 |
% |
|
|
75 |
% |
|
|
|
|
|
|
|
|
Contact:Jerry L. OcheltreePresident and CEOCarolina Trust
BancShares, Inc.(704) 735-1104
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