MT. PLEASANT, S.C., Jan. 17, 2007 (PRIME NEWSWIRE) -- Southcoast Financial Corporation (Nasdaq:SOCB) announced today that it had unaudited net income of $4,839,000 or $0.89 per basic share, for the year ended December 31, 2006. This compares to net income of $4,189,000, or $1.06 per basic share, for the year ended December 31, 2005. The average basic shares, included in the earnings per share calculation, were 38.6% greater for the year ended December 31, 2006, than for the year ended December 31, 2005. This increase in outstanding shares is primarily a result of the completion of our offering of 1,610,000 additional shares of stock during the fourth quarter of 2005. Average shares outstanding for both periods have been adjusted for the 10% stock dividend issued May 26, 2006.
"Southcoast Financial Corporation continues to report increased profits in an ever challenging interest rate market. Asset quality remained strong, and improved during the fourth quarter. Non-performing loans decreased to 0.18% at December 31st, down from 0.28% at September 30th. We slowed our growth somewhat to increase our attention to asset quality and adjust to a slowing of the real estate market. We continued to focus on the core earnings of our Bank subsidiary, Southcoast Community Bank," Chairman and Chief Executive Officer Wayne Pearson said.
Total assets as of December 31, 2006 were $481.9 million compared to $476.6 million as of December 31, 2005, an increase of 1.1%. Loans, excluding loans held for sale, decreased to $367.6 million, down 2.3% from $375.9 million as of December 31, 2005. Deposits dropped 0.2% to $310.9 million over the same period.
"Despite some slowing of growth, our local economy continues to show strength and Southcoast continues to expand its branch network. On January 8, 2007, we opened our ninth branch office at 1654 Sam Rittenberg Blvd, in the West Ashley area of Charleston. This branch is our second office in the West Ashley area. We expect to open our third Mt. Pleasant office in the second quarter of 2007. Our expansion into the Hilton Head market is underway. We have entered into a letter of intent to lease office space for our Hilton Head loan production office. We have acquired two locations for our expansion in the market. Our regional headquarters will be located on Palmetto Bay Road, and an additional branch will be located on Highway 170 in Bluffton," Pearson said.
For the quarter ended December 31, 2006, unaudited net income was $967,000, or $0.18 per basic share. This compares to net income of $1,313,000, or $0.27 per basic share, for the quarter ended December 31, 2005. The reduction of net income is the result of having significant noninterest income in the fourth quarter of 2005 related to the sale of real estate which did not recur in 2006. The average basic shares included in the earnings per share calculation were 13.7% greater for the three months ended December 31, 2006, than for the three months ended December 31, 2005, primarily due to the completion of the aforementioned stock offering during the fourth quarter of 2005. The average shares included in the earnings per share calculation for both periods have been adjusted for the earlier referenced 10% stock dividend.
Southcoast Financial Corporation, headquartered in Mt. Pleasant, South Carolina, is the holding company of Southcoast Community Bank. The Bank, which opened for business July 20, 1998, is a state chartered commercial bank operating from its main office at 530 Johnnie Dodds Boulevard in Mt. Pleasant, South Carolina. Trading in Southcoast Financial Corporation's common stock is reported on NASDAQ under the symbol SOCB. Information about the corporation is available on our web site, www.southcoastbank.com.
This press release contains forward-looking statements about branch openings within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give our expectations or forecasts of future events.
Any or all of our forward-looking statements here or in other publications may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining our actual future results. Consequently, no forward looking-statements can be guaranteed. Our actual results may vary materially, and there are no guarantees about the performance of our stock.
We undertake no obligation to correct or update any forward-looking statements, whether as a result of new information, future results or otherwise. You are advised, however, to consult any future disclosures we make on related subjects in our reports to the SEC.
Southcoast Financial Corporation
SELECTED FINANCIAL DATA
(dollars in thousands, except earnings per share)
Year Year Year
Ended Ended Ended
Dec 2006 Dec. 2005 Dec. 2004
(Unaudited)
INCOME STATEMENT DATA
Net interest income $16,145 $13,914 $10,692
Provision for loan losses 723 865 1,146
Noninterest income 3,837 2,725 2,700
Noninterest expenses 11,542 9,243 7,966
Net income 4,839 4,189 2,982
PER SHARE DATA *
Net income per share
Basic $0.89 $1.06 $0.83
Diluted $0.89 $1.06 $0.82
BALANCE SHEET DATA
Total assets $481,856 $476,599 $366,102
Total deposits 310,893 311,554 258,153
Total loans (net) 363,246 371,656 293,208
Investment securities 46,461 35,203 24,831
Total earning assets 439,507 440,942 344,482
Other Borrowings 67,841 67,000 58,000
Junior subordinated
debentures 21,655 21,655 11,345
Shareholders' equity 78,803 73,315 36,571
Average shares outstanding*
Basic 5,461,034 3,941,199 3,586,523
Diluted 5,465,859 3,945,882 3,637,618
KEY RATIOS
Return on assets 1.00% 1.04% 0.98%
Return on equity 6.36% 9.28% 8.56%
Equity to asset ratio 16.35% 15.38% 9.99%
Non-performing assets to
assets 0.18% 0.11% 0.27%
Reserve to loans 1.19% 1.14% 1.15%
Net interest margin 3.62% 3.69% 3.78%
Employees 110 91 77
# of accounts 10,778 10,728 9,391
# of offices open 8 8 7
# of offices under
construction 2 1 0
# of office sites
purchased 2 0 2
ATM stand alone 1 1 1
Year Year Year
Ended Ended Ended
Dec. 2003 Dec. 2002 Dec. 2001
INCOME STATEMENT DATA
Net interest income $7,858 $5,458 $4,236
Provision for loan losses 735 480 321
Noninterest income 1,711 1,767 1,137
Noninterest expenses 6,171 4,866 4,043
Net income 1,704 1,147 646
PER SHARE DATA *
Net income per share
Basic $0.76 $0.57 $0.36
Diluted $0.74 $0.55 $0.35
BALANCE SHEET DATA
Total assets $253,217 $181,513 $124,309
Total deposits 166,213 132,655 81,856
Total loans (net) 199,732 134,729 95,737
Investment securities 22,049 7,608 8,183
Total earning assets 238,009 168,225 113,323
Other Borrowings 41,100 23,500 30,400
Junior subordinated
debentures 11,345 11,345 0
Shareholders' equity 33,410 12,709 11,549
Average shares outstanding*
Basic 2,246,398 2,021,109 1,783,008
Diluted 2,299,766 2,102,388 1,839,676
KEY RATIOS
Return on assets 0.79% 0.78% 0.59%
Return on equity 10.43% 9.45% 6.69%
Equity to asset ratio 13.19% 7.00% 9.29%
Non-performing assets to
assets 0.04% 0.06% 0.07%
Reserve to loans 1.18% 1.21% 1.25%
Net interest margin 3.90% 4.02% 4.21%
Employees 68 61 50
# of accounts 7,814 6,899 4,975
# of offices open 5 5 4
# of offices under
construction 2 0 1
# of office sites
purchased 1 2 1
ATM stand alone 0 0 0
* Share and per share data has been adjusted for 10% stock
dividends in 2006, 2005, 2004, and 2002 and 10% and 5% dividends
in 2003.
Southcoast Financial Corporation
Consolidated Statements of Condition
(Dollars in thousands, except per share data)
Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31
2006 2005 2004 2003 2002
(Unaudited)
Assets
Cash and due
from banks $7,008 $14,378 $11,853 $5,550 $5,490
Federal Funds
sold 31,204 16,964 4,236 12,031 14,583
Investments 46,461 35,203 24,831 22,049 7,608
Loans held for
sale 140 9,275 12,009 427 8,683
Loans:
Commercial
and
Construction 196,572 209,609 191,836 135,292 95,619
Mortgage 159,774 162,716 101,216 62,543 35,649
Consumer 11,264 3,601 3,559 4,274 5,117
-------- -------- -------- -------- --------
Total loans 367,610 375,926 296,611 202,109 136,385
Less: Allowance
for loan
Losses 4,364 4,270 3,404 2,377 1,656
-------- -------- -------- -------- --------
Net loans 363,246 371,656 293,207 199,732 134,729
Fixed assets 25,126 19,898 14,844 9,412 8,054
Other assets 8,671 9,225 5,122 4,016 2,366
-------- -------- -------- -------- --------
Total Assets $481,856 $476,599 $366,102 $253,217 $181,513
======== ======== ======== ======== ========
Liabilities &
Shareholders'
Equity
Deposits:
Noninterest
bearing $34,694 38,754 $27,955 $19,646 17,393
Interest
bearing 276,199 272,800 230,198 146,567 $115,262
-------- -------- -------- -------- --------
Total
deposits 310,893 311,554 258,153 166,213 132,655
Other
Borrowings 67,841 67,000 58,000 41,100 23,500
Junior
subordinated
debentures 21,655 21,655 11,345 11,345 11,345
Other
liabilities 2,664 3,075 2,034 1,149 1,304
-------- -------- -------- -------- --------
Total
liabilities 403,053 403,284 329,532 219,807 168,804
Shareholders'
Equity
Common Stock 75,316 70,268 34,081 33,298 12,329
Retained
Earnings and
Accumulated
Other
Comprehensive
Income or
Loss 3,487 3,047 2,490 112 380
-------- -------- -------- -------- --------
Total
shareholders'
equity 78,803 73,315 36,571 33,410 12,709
-------- -------- -------- -------- --------
Total
Liabilities
and
Shareholders'
Equity $481,856 $476,599 $366,103 $253,217 $181,513
======== ======== ======== ======== ========
Book value
per
share $14.23** $13.45** $10.17** $9.36** $6.28**
Allowance for
loan losses
to Loans
Ratio 1.19% 1.14% 1.15% 1.18% 1.21%
** Adjusted for a 15% stock dividend in 2003 and a 10% dividend in
2006, 2005, 2004, and 2002.
Southcoast Financial Corporation
Consolidated Income Statements
(Dollars in thousands, except earnings per share)
Year Ended Three Months Ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2006 2005 2006 2005
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Interest Income
Interest and fees
on loans $28,080 $22,206 $7,270 $6,407
Interest on
investments 2,852 1,343 738 404
Interest on Fed
funds sold 478 340 155 72
--------- --------- --------- ---------
Total interest
income 31,410 23,889 $8,163 6,883
Interest expense 15,265 9,975 4,158 3,042
--------- --------- --------- ---------
Net interest
income 16,145 13,914 4,005 3,841
Provision for
loan losses 723 865 0 285
--------- --------- --------- ---------
Net interest
income after loan
loss provision 15,422 13,049 4,005 3,556
Noninterest income 3,837 2,725 565 1,393
--------- --------- --------- ---------
Total operating
income 19,259 15,774 4,570 4,949
Noninterest expense
Salaries and
benefits 6,499 5,711 1,609 1,815
Occupancy and
equipment 1,925 1,291 601 340
Other expenses 3,118 2,241 871 585
--------- --------- --------- ---------
Total
noninterest
expense 11,542 9,243 3,081 2,740
--------- --------- --------- ---------
Income before
taxes 7,717 6,531 1,489 2,209
Income tax expense 2,878 2,342 522 896
--------- --------- --------- ---------
Net income $4,839 $4,189 $967 $1,313
========= ========= ========= =========
Basic net income
per common share* $0.89 $1.06 $0.18 $0.27
Diluted net income
per common share* $0.89 $1.06 $0.18 $0.27
Average shares
outstanding*
Basic 5,461,034 3,941,199 5,470,316 4,812,138
Diluted 5,465,859 3,945,882 5,474,673 4,816,666
* Share and per share data has been adjusted for 10% stock dividends
in 2006 and 2005.