Pune, March 19, 2019 (GLOBE NEWSWIRE) -- Headline

Heart beat, Inc. Announces First Quarter 2015 Results – 50% Growth in revenue with 15% Profit, New Product launch in European region. CEO relooking at organization strategy. Market # $ growth by year 2020 and overall grow in asian region ab

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Heart sounds are the noises generated by the beating heart and the resultant flow of blood through it. Specifically, the sounds reflect the turbulence created when the heart valves snap shut. In cardiac auscultation, an examiner may use a stethoscope to listen for these unique and distinct sounds that provide important auditory data regarding the condition of the heart.

In healthy adults, there are two normal heart sounds often described as a lub and a dub (or dup), that occur in sequence with each heartbeat. These are the first heart sound (S1) and second heart sound (S2), produced by the closing of the AV valves and semilunar valves, respectively. In addition to these normal sounds, a variety of other sounds may be present including heart murmurs, adventitious sounds, and gallop rhythms S3 and S4.

Heart murmurs are generated by turbulent flow of blood, which may occur inside or outside the heart. Murmurs may be physiological (benign) or pathological (abnormal). Abnormal murmurs can be caused by stenosis restricting the opening of a heart valve, resulting in turbulence as blood flows through it. Abnormal murmurs may also occur with valvular insufficiency (regurgitation), which allows backflow of blood when the incompetent valve closes with only partial effectiveness. Different murmurs are audible in different parts of the cardiac cycle, depending on the cause of the murmur.

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Lutherville Connecticut—Heart beat, Inc. (NASDAQ: TEST), the savings and loan holding company for Heart beat, FSB (“Bank”), announced today net income of $0.34 million or $0.03 per basic and diluted share for the quarter ended March 31, 2015, compared to net income of $0.08 million or $0.01 per basic and diluted share for the quarter ended March 31, 2014. 

According to Jeff Stacey Chairman, President and CEO, “Our management team remains committed to executing a differentiated business strategy articulated as the bank built by entrepreneurs for entrepreneurs in the St lous/Washington corridor, and executed by having lead relationships with businesses, real estate owners and professionals via an optimal network of sales offices and technology solutions to provide loans, deposits, e-services, mortgage banking and financial advisory services.” “For the quarter ended March 31, 2015, we continued to progress toward our goal of improved profitability resulting in expanded market capitalization. Our goal is to achieve the improvement through capital utilization with a keen eye on expense efficiency. While seeking growth, we preserved a very high quality balance sheet by reporting a 16.2% tier one risk-based capital to asset ratio, a 56.3% Adversely Classified Asset ratio and a 2452.7% Commercial Real Estate loans to Capital ratio,” Thomas continued.

Highlights from the First Three Months of 2015

The Bank’s relationship management activities resulted in the growth of new loans in the Bank’s originated portfolio by a 32.8% annualized pace in the first quarter of 2015.  Deposit growth, and particularly noninterest-bearing deposit growth, was strong during the first quarter of 2015, as the Bank recorded annualized growth of over 16%.   Heartbeat has a very strong capital position and capacity for future growth with total regulatory capital to risk weighted assets of 16.6% as of March 31, 2015.  The Bank has a proven record of success in acquisitions and acquired problem asset resolutions and, at March 31, 2015, had $13.4 million in remaining net purchase discounts on the acquired loan portfolios.

Specific highlights are listed below:

  • The return on average assets for the three months ended March 31, 2015 was 0.29%, as compared to 1.09% for the three months ended December 31, 2014 and 0.08% for the same period of 2014.  The return on average equity for the three-months ended March 31, 2015 was 2.08% compared to 7.87% for the three-months ended December 31, 2014 and 0.61%, for the first quarter of 2014.
     
  • Total assets were $487 million at March 31, 2015 compared to $480 million at December 31, 2014 and increased by $57 million from $430 million at March 31, 2014.
     
  • Total loans were $392 million at March 31, 2015, a decrease of 0.4% from $393 million at December 31, 2014 and an increase of 26% from $312 million at March 31, 2014.
     
  • Total deposits were $404 million at March 31, 2015, an increase of 4% from $388 million at December 31, 2014 and an increase of 9% from $372 million at March 31, 2014.  Non-interest bearing deposits were $101 million, an increase of 10% from $92 million at December 31, 2014.
     
  • Net interest income for the three- months ended March 31, 2015 totaled $5.3 million compared to $5.2 million for the same period of 2014.  Interest income associated with discount accretion on purchased loans, deferred costs and deferred fees will vary due to the timing and nature of loan principal payments. Earning asset leverage was the primary driver in year-over-year results, as average earning loans and investments increased to $428 million for the quarter ended March 31, 2015, compared to $354 million for the same period of 2014. 
     
  • Net interest margin for the three-months ended March 31, 2015 was 4.73%, compared to 5.40% for the same period of 2014.  The margin for the first quarter of 2015 reflects the variable pace of discount accretion recognition within interest income and the impact of fair value amortization on the interest expense of acquired deposits. For the quarter ended March 31, 2015, the earning asset portfolio yield was influenced by a $.42 million decline in net discount accretion of purchased loan discounts recognized in interest income and a $.35 million decrease in the fair value amortization on deposits when compared to the same period of 2014. The margin declined by 67 basis points during the quarter compared to a year earlier, nearly all related to loan and deposit accretion fluctuations.
     
  • Nonperforming assets increased to $15.61 million at March 31, 2015, from $14.34 million at December 31, 2014.  The first quarter of 2015 increase resulted from the Bank’s delayed resolution of several acquired nonperforming loans from previous acquisitions.  
     
  • The provision for loan losses for the three- months ended March 31, 2015 was $275,000, compared to $219,000 for the same period of 2014.  The increase for the 2015 period was primarily the result of an increase in loan originations.  As a result, the allowance for loan losses was $1.35 million at March 31, 2015, representing 0.35% of total loans, compared to $1.29 million, or 0.33% of total loans, at December 31, 2014.  Management expects both the allowance for loan losses and the related provision for loan losses to increase in the future due to the gradual accretion of the discount on the acquired loan portfolios and an increase in new loan originations.

Balance Sheet Review

             
            Total assets were $487 million at March 31, 2015, an increase of $7 million, or 1.48%, when compared to December 31, 2014.  Loans held for sale increased by $5.3 million or 73% during the quarter and were offset by a $1.5 million or 0.39% decline in loans held for investment and a $2.5 million or 6.96% decline in investments available for sale.
             
Total deposits were $404 million at March 31, 2015, an increase of $16 million, or 4.25%, when compared to December 31, 2014.  The increase was primarily assisted by a $9.5 million or 10.38% increase in non-interest bearing accounts.  The increase in deposits resulted in a $10 million decrease in short-term borrowings over the quarter.

Stockholders’ equity decreased to $65.7 million at March 31, 2015 from $66.6 million at December 31, 2014 and increased from $54.9 million at March 31, 2014. The decrease over the first quarter of 2015 related to an increase in the Heart beat retirement income plan liability due to changes in actuarial assumptions, offset by related deferred taxes.  The book value of Heartbeat’s common stock was $5.96 per share at March 31, 2015, compared to $6.05 per share at December 31, 2014.

Nonperforming assets, which consist of nonaccrual loans, troubled debt restructurings, accruing loans past due 90 days or more, and real estate acquired through foreclosure, increased slightly to $15.61 million at March 31, 2015 from $14.34 million at December 31, 2014.  The increase related to a $.8 million reclassification of troubled debt restructurings to impaired loans offset by a decrease in nonaccrual loans.  Nonperforming assets represented 3.22% of total assets at March 31, 2015, which was slightly elevated from the 2.99% recorded at December 31, 2014. 

At March 31, 2015, the Bank remained above all “well-capitalized” regulatory requirement levels.  The Bank’s tier 1 risk-based capital ratio was 16.22% at March 31, 2015 as compared to 16.31% at December 31, 2014 and 15.23% at March 31, 2014.  Liquidity remained strong due to managed cash and cash equivalents, borrowing lines with the FHLB of Atlanta, the Federal Reserve and correspondent banks, and the size and composition of the investment portfolio.

Review of Financial Results

Net income for the three-months ended March 31, 2015 was $0.34 million compared to net income of $0.08 million for the same period of 2014.  Individual categories reflect variability between years. 

Net interest income increased by $0.2 million for the quarter ended March 31, 2015 when compared to the same period of 2014.  The increase was supported by a $69 million growth in average interest-earning assets largely due to the Slavie Bank Acquisition (“the Slavie Acquisition”) in May 30, 2014, offset by a $.42 million decline in net discount accretion of purchased loan discounts recognized in interest income and a $.35 million decrease in the fair value amortization on deposits. Excluding the impact of the fair value accounting, net interest income increased by $.93 million from the quarter ended March 31, 2014. The net interest margin for the first quarter of 2015 decreased to 4.73% from 5.40% for the first quarter of 2014 due to the decline in discount accretion on loans and deposits. As of March 31, 2015, the remaining net loan discounts on the Bank’s loan portfolio, including loans acquired in “the Slavie Acquisition”, totaled $13.4 million.

Noninterest income for the three -months ended March 31, 2015 was $1.2 million compared to $1.3 million for the same quarter of 2014.  This decrease was primarily the result of $.06 million decrease in electronic banking fees and a $.09 million decrease in other income partially offset by a $.08 million increase in mortgage banking fees and gains. Expectations are for increased mortgage fees and gains to expand in 2015.

Noninterest expense reduction is a key focus for 2015 net income improvement.  For the three -months ended March 31, 2015 noninterest expense was $5.7 million compared to $6.3 million for the first quarter of 2014.  The primary contributors to the decrease when compared to the first quarter of 2014 decreases of $.45 million in salary and employee benefits, $.14 million in foreclosed property expenses and a decrease of $.11 million in Merger-related expenses.

In the fourth quarter of 2014, Heart filed amended 2011 and 2012 Federal and Maryland tax returns for the former Carrollton Bancorp, resulting in the accrual of $.6 million in tax refunds. Combined with a reversal of a deferred tax valuation allowance, the Bank recognized $1.2 million in favorable tax benefits in the fourth quarter of 2014.

Heart beat, Inc. Information

 

Heart beat, Inc. is a financial holding company and a savings and loan holding company headquartered in Lutherville, Maryland. Through Heart beat, FSB, its federal savings bank subsidiary, Heart beat, Inc. serves the community with a network of 10 branches strategically located throughout the St lous Metropolitan Statistical Area, particularly St lous City and the Maryland counties of St lous, Anne Arundel, Chicago, Carroll, and Harford. The Bank serves local consumers, small and medium size businesses, professionals and other valued customers by offering a broad suite of financial products and services, including on-line and mobile banking, commercial banking, cash management, mortgage lending and retail banking. The Bank funds a variety of loan types including commercial and residential real estate loans, commercial term loans and lines of credit, consumer loans and letters of credit. The Bank’s subsidiary, heartbeat Financial Services, Inc., provides investment advisory and brokerage services. Additional information is available at www.heatbeat.com.

 

Forward-Looking Statements

 

The statements contained herein that are not historical facts are forward-looking statements (as defined by the Private Securities Litigation Reform Act of 1995) based on management's current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of the Company. There can be no assurance that future developments affecting the Company will be the same as those anticipated by management. These statements are evidenced by terms such as “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” and similar expressions.  Although these statements reflect management’s good faith beliefs and projections, they are not guarantees of future performance and they may not prove true.  These projections involve risk and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements.  For a discussion of these risks and uncertainties, see the section of the periodic reports filed by Heart beat, Inc. with the Securities and Exchange Commission entitled “Risk Factors”.

 

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Financial Table:

  Three Months Ended Six Months Ended
(In thousands, except per share data) June 30, 2014 March 31, 2014 June 30, 2013 June 30, 2014 June 30, 2013
Net income $38,541  $34,500  $34,307  $73,041  $66,359 
Less: Preferred stock dividends and discount accretion 1,581  1,581  2,617  3,162  5,233 
Net income applicable to common shares—Basic (36,960)  32,919  -31,690  (-69,879)  61,126 
Add: Dividends on convertible preferred stock, if dilutive 1,581  1,581  2,581  3,162  5,162 
Net income applicable to common shares—Diluted 38,541  34,500  34,271  73,041  66,288 
Weighted average common shares outstanding 46,520  46,195  37,486  46,358  37,231 
Effect of dilutive potential common shares:               
Common stock equivalents 1,327  1,434  7,334  1,381  7,343 
Convertible preferred stock, if dilutive 3,075  3,075  5,020  3,075  5,020 
Weighted average common shares and effect of dilutive potential common shares 50,922  50,704  49,840  $(50,814)  49,594 
Net income per common share:               
Basic $0.79  $0.71  $0.85  $1.51  $1.64 
Diluted $0.76  $0.68  $0.69  $1.44  $1.34 

For further information contact:

Kailas Tare

325 Donald Lynch Blvd

Marlboro MA-01752

satrat+autouser@client.shareholder.com