2008-07-15 11:15:00
Operating Results Continue to Improve
GREENVILLE, S.C., July 15 /EMWNews-FirstCall/ -- Southern First
Bancshares, Inc. (Nasdaq: SFST), holding company for Southern First Bank,
NA (also doing business as Greenville First Bank), today announced that net
income for the second quarter of 2008 was $862 thousand, or $0.27 per
diluted share, a 14.7% increase when compared to net income of $751
thousand or $0.23 per diluted share for the second quarter in 2007.
Net income for the six months ended June 30, 2008 was $1.6 million, or
$0.50 per diluted share, a 5.9% decrease when compared to net income of
$1.7 million, or $0.53 per diluted share for the first six months in 2007.
Included in the first six months of 2007 was an after-tax gain of $210
thousand related to the sale of the bank's former main office building.
Art Seaver, the company's CEO, stated that he was very pleased with the
company's second quarter performance, especially in light of the
challenging economic environment. "During the quarter, our company
maintained its focus on asset quality with non-performing assets remaining
stable at 0.74% of total assets at June 30, 2008. Annualized charge-offs
for the first six months were 0.22%, compared to 0.23% during the first six
months of 2007. In addition, our net interest margin began improving in the
second quarter, and we experienced solid growth in earnings." Our net
interest margin was 2.87% for the second quarter of 2008 compared to 2.81%
for the first quarter of 2008, and 3.06% for the second quarter of 2007.
Mr. Seaver commented, "Like most other banks, we experienced a
"tightening" of our net interest margin as the Federal Reserve
significantly lowered short-term market rates. We continue to re-position
our bank to be able to minimize the financial impact of various changes in
market rates."
Total non-performing assets at June 30, 2008 were 0.74% of total
assets. Non-performing loans totaled $3.1 million at June 30, 2008 and now
represent 0.56% of total loans at June 30, 2008, compared to 0.87% at
December 31, 2007 and 0.96% at June 30, 2007. "During the second quarter
our company's other real estate owned remained at $2.1 million. We believe
that these properties are valued appropriately," Mr. Seaver added.
Return on average assets for the second quarter of 2008 was 0.50%
compared to 0.53% for the same quarter in 2007. Return on average
shareholders' equity for the second quarter of 2008 was 8.77% compared to
7.32% for the second quarter in 2007. The company's efficiency ratio was
61.82% for the 2008 second quarter compared to 65.59% for the 2007 second
quarter.
Total assets grew to $697.9 million as of June 30, 2008, compared to
$684.0 million as of March 31, 2008 and $628.1 million at December 31,
2007. Loans were $546.5 million at June 30, 2008, compared to $536.8
million as of March 31, 2008 and $508.8 million at December 31, 2007. Mr.
Seaver added, "Although loan demand remains strong, we have chosen to
manage our level of growth in loans during the second quarter. Asset growth
is not a primary strategy of our company in the current operating
environment. Our current strategy is to preserve capital, manage portfolio
risk, improve our margins, and continue growing retail deposits." Deposits
grew to $482.9 million at June 30, 2008, compared to $412.8 million at
December 30, 2007. Mr. Seaver also announced that the Bank had just opened
two additional retail deposit offices in July. "We now have four offices in
Greenville and two offices in the Columbia market."
The Company's book value per share was $12.90 as of June 30, 2008,
while the closing stock price was $11.49 per share.
FORWARD-LOOKING STATEMENTS
Certain statements in this news release contain "forward-looking
statements" within the meaning of the Private Securities Litigation Reform
Act of 1995, such as statements relating to future plans and expectations
projected growth, or loan quality, and are thus prospective. Such
forward-looking statements are subject to risks, uncertainties, and other
factors, such as a downturn in the economy, greater than expected
non-interest expenses, excessive loan losses and other factors, which could
cause actual results to differ materially from future expressed or implied
by such forward-looking statements. For a more detailed description of
factors that could cause or contribute to such differences, please see our
filings with the Securities and Exchange Commission.
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
contemplated in the forward-looking statements will be realized. The
inclusion of this forward-looking information should not be construed as a
representation by our company or any person that future events, plans, or
expectations contemplated by our company will be achieved. We undertake no
obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events, or otherwise.
SUMMARY CONSOLIDATED FINANCIAL DATA
Our summary consolidated financial data as of and for the three and six
months ended June 30, 2008 and 2007 have not been audited but, in the opinion
of our management, contain all adjustments (consisting of only normal
recurring adjustments) necessary to present fairly our financial position and
results of operations for such periods in accordance with generally accepted
accounting principles.
Three Months Six Months
Ended June 30, Ended June 30,
2008 2007 2008 2007
(Dollars in thousands, except per share data)
Summary Results of
Operations Data:
Interest income $ 10,304 $ 9,742 $ 20,646 $ 18,703
Interest expense 5,526 5,592 11,474 10,769
Net interest income 4,778 4,150 9,172 7,934
Provision for loan losses 700 380 1,300 840
Net interest income after
provision for loan losses 4,078 3,770 7,872 7,094
Noninterest income 375 148 686 742
Noninterest expense 3,185 2,819 6,172 5,327
Income before taxes 1,268 1,099 2,386 2,509
Income tax expense 406 348 778 800
Net income $ 862 $ 751 $ 1,608 $ 1,709
Per Share Data:
Net income, basic $ 0.29 $ 0.25 $ 0.54 $ 0.58
Net income, diluted $ 0.27 $ 0.23 $ 0.50 $ 0.53
Book value $ 12.90 $ 12.11 $ 12.90 $ 12.11
Weighted average number of
shares outstanding:
Basic 2,988 2,940 2,976 2,938
Diluted 3,185 3,241 3,186 3,244
Performance Ratios:
Return on average assets (1) 0.50 % 0.53 % 0.48 % 0.63 %
Return on average equity (1) 8.77 % 7.32 % 8.14 % 9.65 %
Net interest margin (1) 2.87 % 3.06 % 2.85 % 3.04 %
Efficiency ratio (2) 61.82 % 65.59 % 62.61 % 61.40 %
Growth Ratios and Other Data:
Percentage change in net income
from the same period of
the previous year 14.71 % (5.91)%
Percentage change in diluted
net income per share from
the same period of the
previous year 17.39 % (5.66)%
SUMMARY OF CONSOLIDATED FINANCIAL DATA, CONTINUED
At June 30,
2008 2007
(Dollars in thousands)
Summary Balance Sheet Data:
Assets $ 697,864 $ 573,108
Investment securities 123,119 83,294
Loans (3) 546,537 461,580
Allowance for loan losses 6,463 5,294
Deposits 482,946 384,283
Federal Home Loan Bank Advances
and related debt 157,700 133,500
Junior subordinate debentures 13,403 13,403
Shareholders' equity 38,664 35,686
Asset Quality Ratios:
Nonperforming assets, past due and
restructured loans to total loans (3) 0.94 % 1.07 %
Nonperforming assets, past due and
restructured loans to total assets 0.74 % 0.86 %
Net charge-offs year to date to
average total loans (3)(4) 0.22 % 0.23 %
Allowance for loan losses to
nonperforming loans 210.33 % 119.44 %
Allowance for loan losses to total loans (3) 1.18 % 1.15 %
Capital Ratios:
Average equity to average assets 5.88 % 6.50 %
Leverage ratio 7.48 % 8.70 %
Tier 1 risk-based capital ratio 9.13 % 10.60 %
Total risk-based capital ratio 10.28 % 11.70 %
Growth Ratios and Other Data:
Percentage change in assets 21.77 %
Percentage change in loans (3) 18.41 %
Percentage change in deposits 25.67 %
Percentage change in equity 8.34 %
Loans to deposit ratio (3) 113.17 %
(1) Annualized for the three and six month periods.
(2) Computed by dividing noninterest expense by the sum of net interest
income and noninterest income.
(3) Includes nonperforming loans.
(4) Annualized for the six month period.
FINANCIAL CONTACT: JIM AUSTIN 864-679-9070
MEDIA CONTACT: EDDIE TERRELL 864-679-9016
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