Impact of Tax Reform on Home BancShares, Inc.
January 08 2018 - 6:26PM
Home BancShares, Inc. (Nasdaq:HOMB) (“Home” or “the Company”),
parent company of Centennial Bank (“Centennial”), announced today
that as a result of the “Tax Cuts and Jobs Act” (the “TCJA”) that
President Donald Trump signed into law on December 22, 2017, the
Company will be required to revalue its deferred tax assets and
deferred tax liabilities to account for the future impact of lower
corporate tax rates on these deferred amounts. The reduction in the
federal corporate tax rate will negatively impact Home’s fourth
quarter 2017 results but is expected to positively impact Home’s
future after-tax earnings.
As of December 31, 2017, the Company performed a
preliminary analysis to determine the impact of the revaluation of
the deferred tax asset of approximately $113.5 million. The
current impact of this will be a one-time non-cash charge to the
income statement of approximately $36.9 million that will reduce
Home’s fourth quarter 2017 results. Under the Company’s
analysis, the fourth quarter earnings impact would be approximately
$(0.22) per share and the tangible book value impact would be
approximately $(0.21) per share based on fourth quarter weighted
average diluted shares of approximately 174,348,000 and total
shares outstanding of approximately 173,633,000 at year end,
respectively.
“The savings from this historic legislation will
improve cash flow and earnings per share beginning in 2018,
delivering excellent value-generating opportunities for our Company
and ultimately our shareholders,” said John Allison, Chairman.
These preliminary estimates of the impact of tax
reform on Home should not be viewed as a substitute for full
financial statements prepared in accordance with U.S. generally
accepted accounting principles, and are not necessarily indicative
of the results to be achieved for any future periods. The estimates
have been prepared by management and Home’s independent auditors
have not completed their audit or review of such information.
This release contains forward-looking statements
regarding the Company's outlook and expectations with respect to
the enactment of the TCJA, effective January 1, 2018, including the
impact of the TCJA on the Company’s deferred tax assets, the impact
of the revaluation of the deferred tax assets on the Company’s
fourth quarter 2017 results and the anticipated impact of the TCJA
on the Company’s future earnings. Statements in this press release
that are not historical facts should be considered forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements of this type speak
only as of the date of this news release. By nature,
forward-looking statements involve inherent risk and uncertainties.
Various factors, including, but not limited to, uncertainties in
the Company’s preliminary review of, and additional analysis with
respect to, the impact of the TCJA, as well as additional risks and
uncertainties contained in the “Risk Factors” and forward-looking
statements disclosure contained in the Company’s Annual Report on
Form 10-K for the year ended December 31, 2016 and in its Quarterly
Report on Form 10-Q for the quarter ended September 30, 2017, filed
with the Securities and Exchange Commission (the “SEC”) on February
28, 2017 and November 7, 2017, respectively, could cause actual
results to differ materially from those contemplated by the
forward-looking statements. Although we believe that the
assumptions underlying the forward-looking statements are
reasonable, any of the assumptions could prove to be inaccurate.
Therefore, we can give no assurance that the results and estimates
contemplated in the forward-looking statements will be realized.
The Company assumes no duty to update, amend or clarify
forward-looking statements, whether as a result of new information,
future events or otherwise.
Home BancShares, Inc. is a bank holding company,
headquartered in Conway, Arkansas. Our wholly-owned subsidiary,
Centennial Bank, provides a broad range of commercial and retail
banking plus related financial services to businesses, real estate
developers, investors, individuals and municipalities. Centennial
Bank has branch locations in Arkansas, Florida, South Alabama and
New York City. The Company's common stock is traded through the
NASDAQ Global Select Market under the symbol “HOMB.”
FOR MORE INFORMATION CONTACT:
Jennifer C. FloydChief Accounting Officer &Investor
Relations OfficerHome BancShares, Inc.(501) 339-2929
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