MT. PLEASANT, S.C., Oct. 22, 2007 (PRIME NEWSWIRE) -- Southcoast Financial Corporation (Nasdaq:SOCB) announced that it had unaudited pre-tax income of $4,010,000 and unaudited net income of $2,705,000, or unaudited net income of $.49 per basic share, for the nine months ended September 30, 2007. This compares to unaudited pre-tax income of $6,230,000 and unaudited net income of $3,873,000, or unaudited net income of $0.65 per basic share for the nine months ended September 30, 2006. Included in net income for the nine months ended September 30, 2006 was $1,768,000 of pre-tax income related to sales of real estate. This non- recurring income increased after-tax net income by $1,132,000, or $0.19 per basic share. The September 30, 2007 earnings per share are based on 5,554,195 basic average shares outstanding compared to 6,003,734 basic average shares outstanding for the nine months ended September 30, 2006. This decrease in outstanding shares is the result of a stock repurchase plan adopted in January and again in July of 2007. The Company's Board of Directors authorized the repurchase of 10% of the Company's outstanding shares as of January 19, 2007. On July 24, 2007, the Company's Board of Directors authorized an additional repurchase of 10% of the Company's outstanding shares. During the first nine months of 2007, the Company repurchased 1,002,244 shares for a total of $19,443,547.
For the quarter ending September 30, 2007, pre-tax income was $1,445,000 and net income was $1,010,000, or net income of $0.19 per share. This compares to pre-tax income of $1,669,000 and net income of $1,057,000, or net income of $0.18 per share, for the quarter ending September 30, 2006. The 2007 earnings per share are based on 5,217,249 basic average shares outstanding compared to 6,015,596 basic average shares outstanding for the quarter ending September 30, 2006.
Chairman and Chief Executive Officer, L. Wayne Pearson said, "Our earnings per share and return on equity has increased each quarter during the year. This is the result of core bank earnings in each quarter, the maturity of our branch network, and the success of our stock repurchase program."
Total assets as of September 30, 2007 were $477.8 million compared to $481.9 million as of December 31, 2006, a decrease of 0.9%. Loans, excluding loans held for sale, increased to $370.0 million, up 0.7% from $367.6 million as of December 31, 2006. Deposits during the same period declined 2.5% to $303.0 million. The decline in deposits is directly related to our decision to reduce our wholesale lending operations and our related brokered and wholesale deposit base. As of September 30, 2007, the ratio of nonperforming assets to total assets was 0.56% and the allowance for loan losses as a percentage of loans was 1.17%.
The Corporation currently has ten branches. The ninth branch at 1654 Sam Rittenberg Boulevard in West Ashley opened in January 2007. The tenth branch at the intersection of Highway 17N at Park West and South Morgans Point Road in Mt. Pleasant, South Carolina, opened in May 2007. "Our branch network is gathering local deposits, allowing us to reduce our reliance on wholesale and brokered deposits," said Pearson.
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. Southcoast Financial Corporation's common stock is traded on the NASDAQ Global Market under the symbol SOCB.
This press release contains forward-looking statements 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 filed with the SEC.
Southcoast Financial Corporation
SELECTED FINANCIAL DATA
(dollars in thousands, except earnings per share)
Nine Months Ended Three Months Ended
Sept. 2007 Sept. 2006 Sept. 2007 June 2007 March 2007
(Unuadited)(Unuadited)(Unuadited)(Unuadited) (Unuadited)
INCOME STATEMENT DATA
Net interest
income $ 10,838 $ 12,283 $ 3,473 $ 3,723 $ 3,641
Provision for
loan losses - 722 - - -
Noninterest
income 1,921 3,129 757 562 603
Noninterest
expense 8,749 8,460 2,785 2,995 2,969
Net income 2,705 3,873 1,010 864 831
PER SHARE DATA *
Net income
per share
Basic $0.49 $0.65 $0.19 $0.15 $0.14
Diluted $0.49 $0.64 $0.19 $0.15 $0.14
BALANCE SHEET DATA
Total assets $ 477,805 $ 483,928 $ 477,805 $ 487,704 $ 464,003
Total
deposits 303,025 321,500 303,025 308,652 279,148
Total
loans (net) 365,703 370,644 365,703 368,025 359,625
Investment
securities 55,068 63,302 55,068 59,785 47,404
Total earning
assets 423,318 443,970 423,318 433,116 425,821
Advances
from FHLB 78,500 58,000 78,500 75,500 81,000
Junior
subordinated
debentures 17,530 21,655 17,530 21,655 21,655
Shareholders'
equity 62,009 77,854 62,009 68,945 73,272
Average shares outstanding
Basic 5,554,195 6,003,734 5,217,249 5,603,193 5,849,085
Diluted 5,559,507 6,009,280 5,221,217 5,609,052 5,854,599
Key ratios **
Return on
assets 0.76% 1.07% 0.83% 0.73% 0.71%
Return on
equity 5.14% 6.85% 6.53% 4.83% 4.43%
Equity to
asset ratio 12.98% 16.09% 12.98% 14.14% 15.79%
Non-performing
assets
to assets 0.56% 0.28% 0.56% 0.38% 0.09%
Reserve
to loans 1.17% 1.17% 1.17% 1.16% 1.20%
Net interest
margin 3.45% 3.70% 3.36% 3.54% 3.42%
# of
accounts 11,418 10,952 11,418 11,516 10,863
# of
offices open 10 8 10 10 9
# of
offices under
construction 0 1 0 0 1
# of office
sites
purchased 2 1 2 2 2
ATM stand alone 1 1 1 1 1
Year Ended Year Ended
December 2006 December 2005
INCOME STATEMENT DATA
Net interest income $ 16,145 $ 13,914
Provision for loan losses 723 865
Noninterest income 3,837 2,725
Noninterest expense 11,542 9,243
Net income 4,839 4,189
PER SHARE DATA *
Net income per share
Basic $ 0.81 $ 0.97
Diluted $ 0.80 $ 0.97
BALANCE SHEET DATA
Total assets $ 481,856 $ 476,599
Total deposits 310,893 311,554
Total loans (net) 363,247 371,656
Investment securities 46,460 35,203
Total earning assets 445,129 440,942
Advances from FHLB 66,000 67,000
Junior subordinated debentures 21,655 21,655
Shareholders' equity 78,803 73,315
Average shares outstanding
Basic 6,007,137 4,335,319
Diluted 6,012,445 4,340,470
Key ratios **
Return on assets 1.00% 1.04%
Return on equity 6.22% 9.28%
Equity to asset ratio 16.35% 15.38%
Non-performing assets to assets 0.18% 0.11%
Reserve to loans 1.19% 1.14%
Net interest margin 3.64% 3.69%
# of accounts 10,778 10,728
# of offices open 8 8
# of offices under construction 2 1
# of office sites purchased 2 0
ATM stand alone 1 1
* Share and per share data has been adjusted for 10% stock dividends
in 2007, 2006, and 2005.
** Ratios for three months are annualized.
Southcoast Financial Corporation
Consolidated Statements of Condition
(Dollars in thousands, except per share data)
Sept. 30 Sept. 30 Dec. 31 Dec. 31 Dec. 31
2007 2006 2006 2005 2004
(Unaudited)(Unaudited)
Assets
Cash and due from
banks $ 7,035 $ 14,074 $ 7,008 $ 14,378 $ 11,853
Federal Funds sold 0 2,775 31,204 16,964 4,236
Investments 55,068 63,302 46,460 35,203 24,831
Loans held for sale 243 582 140 9,275 12,009
Loans 370,018 375,039 367,611 375,926 296,611
Less: Allowance for
loan Losses 4,315 4,395 4,364 4,270 3,404
-------- -------- -------- -------- --------
Net loans 365,703 370,644 363,247 371,656 293,207
Fixed assets 25,780 23,253 25,126 19,898 14,844
Bank Owned Life
Insurance 17,704 2,610 2,632 2,600 --
Other assets 6,272 6,689 6,039 6,625 5,122
-------- -------- -------- -------- --------
Total Assets $477,805 $483,929 $481,856 $476,599 $366,102
======== ======== ======== ======== ========
Liabilities &
Shareholders' Equity
Deposits:
Noninterest
bearing $ 35,005 $ 39,756 $ 34,694 38,754 $ 27,954
Interest bearing 268,020 281,744 276,199 272,800 230,198
-------- -------- -------- -------- --------
Total deposits 303,025 321,500 310,893 311,554 258,152
Other Borrowings 92,810 59,575 67,841 67,000 58,000
Junior subordinated
debentures 17,530 21,655 21,655 21,655 11,345
Other liabilities 2,431 3,344 2,664 3,075 2,034
-------- -------- -------- -------- --------
Total liabilities 415,796 406,074 403,053 403,284 329,531
Shareholders' Equity
Common Stock 60,309 75,287 75,316 70,268 34,081
Retained Earnings 1,700 2,568 3,487 3,047 2,490
-------- -------- -------- -------- --------
Total
shareholders'
equity 62,009 77,855 78,803 73,315 36,571
-------- -------- -------- -------- --------
Total Liabilities
and Shareholders'
Equity $477,805 $483,929 $481,856 $476,599 $366,102
======== ======== ======== ======== ========
Book value per
share $12.35 ** $12.94 ** $13.10 ** $12.23 ** $9.25 **
Allowance for loan
losses to Loans Ratio 1.17% 1.17% 1.19% 1.14% 1.15%
** Adjusted for 10% stock dividends in 2007, 2006, 2005, and 2004
Southcoast Financial Corporation
Consolidated Income Statements
(Dollars in thousands, except earnings per share)
Nine Months Ended Three Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
2007 2006 2007 2006
(Unaudited)(Unaudited)(Unaudited)(Unaudited)
Interest Income
Interest and fees
on loans $ 21,471 $ 20,953 $ 7,248 $ 7,106
Interest on investments 1,969 2,114 763 919
Interest on
Fed funds sold 358 323 61 60
---------- ---------- ---------- ----------
Total interest income 23,798 23,390 8,072 8,085
Interest expense 12,960 11,107 4,599 4,142
---------- ---------- ---------- ----------
Net interest income 10,838 12,283 3,473 3,943
Provision for loan losses 0 722 0 98
---------- ---------- ---------- ----------
Net interest income
after loan loss provision 10,838 11,561 3,473 3,845
Noninterest income 1,921 3,129 757 647
---------- ---------- ---------- ----------
Total operating income 12,759 14,690 4,230 4,492
Noninterest expense
Salaries and benefits 4,935 4,890 1,512 1,467
Occupancy and equipment 1,704 1,417 599 523
Other expenses 2,110 2,153 674 833
---------- ---------- ---------- ----------
Total noninterest
expense 8,749 8,460 2,785 2,823
---------- ---------- ---------- ----------
Income before taxes 4,010 6,230 1,445 1,669
Income tax expense 1,305 2,357 435 612
---------- ---------- ---------- ----------
Net income $ 2,705 $ 3,873 $ 1,010 $ 1,057
========== ========== ========== ==========
Basic net income
per common share $ 0.49 $ 0.65 $ 0.19 $ 0.18
Diluted net income
per common share $ 0.49 $ 0.64 $ 0.19 $ 0.18
Average shares
outstanding*
Basic 5,554,195 6,003,734 5,217,249 6,015,596
Diluted 5,559,507 6,009,280 5,221,717 6,020,576
* Share and per share data has been adjusted for 10% stock dividends in
2007 and 2006.