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| 8-K - FORM 8-K - SOUTHWEST GEORGIA FINANCIAL CORP | sgfc8k012615.htm |
News Release
INVESTOR AND MEDIA CONTACT:
George R. Kirkland
Executive Vice President and Chief Financial Officer
Phone: (229) 873-3830
investorinfo@sgfc.com
For Immediate Release
Southwest Georgia Financial Corporation Reports Net Income Growth for 2014
MOULTRIE, GEORGIA, January 26, 2015 -- Southwest Georgia Financial Corporation (the “Corporation”) (NYSE MKT: SGB), a full-service community bank holding company, today reported its results of operations for the fourth quarter and year ended December 31, 2014.
Income Highlights
| · | For the year ended December 31, 2014, net income was $2.9 million, or $1.14 per diluted share, a 4.7% increase when compared with $2.8 million, or $1.09 per diluted share, for the 2013 period. Earnings growth was driven by higher net interest income resulting from a change in asset mix. |
| · | Annual net interest income was $13.4 million at year-end 2014, up $545 thousand over the prior-year period. Higher net interest income was partially offset by lower mortgage banking revenue as Empire, the Corporation’s commercial mortgage banking subsidiary, continued to wind down. |
| · | Net income was $662 thousand in the 2014 fourth quarter, or $0.26 per diluted share, compared with $982 thousand, or $0.39 per diluted share, in the fourth quarter of 2013. This difference was mostly due to a $312 thousand gain on the sale of securities in the fourth quarter of 2013. |
Balance Sheet Trends and Asset Quality
| · | Total assets at December 31, 2014, were consistent at $374 million compared with December 31, 2013. Average assets, however, were up $16 million over the comparable 2013 period. |
| · | Total loans increased $5.7 million, or 2.6%, to $224.4 million from the same period last year. Average loans grew $8.3 million compared with the year 2013, despite $10.2 million in loan participations that were paid off in 2014. The growth in loans was funded by increases in average noninterest-bearing and money market deposits. |
| · | Total deposits were $310 million at December 31, 2014, consistent with the end of 2013. Average core deposits were up $18.8 million compared with December 31, 2013. |
| · | Asset quality continued to remain strong as the non-performing asset ratio was 0.28% at December 31, 2014, an 8 basis point improvement from 0.36% at the end of 2013. |
Capital Management
| · | The Corporation has a Total Risk-Based Capital Ratio of 15.70% and a Leverage Capital Ratio of 9.14%, up from 15.44% and 8.73%, respectively, compared with 2013. Both ratios are measurably above the federal “well capitalized” standard. |
| · | Tangible book value per share at December 31, 2014, was $13.45, up from $12.29 at the end of 2013. |
DeWitt Drew, President and CEO commented, “In 2014, we demonstrated the strength of our strategy as we increased our annual dividend 60% and generated healthy net income growth while maintaining strong asset quality metrics. Although loan growth has slowed due to perceived lower levels of economic activity and increased competition in our trade area, we remain focused on our strategy to grow low cost core funding to support lending within our local markets.”
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Dividends
In December 2014, the Corporation paid a fourth quarter cash dividend of $0.08 per common share. The Corporation paid dividends of $0.32 per common share in 2014, a 60% increase over the $0.20 per common share paid in 2013. Southwest Georgia Financial Corporation or its predecessor, Southwest Georgia Bank, has paid cash dividends for 86 consecutive years.
About Southwest Georgia Financial Corporation
Southwest Georgia Financial Corporation is a state-chartered bank holding company with approximately $374 million in assets headquartered in Moultrie, Georgia. Its primary subsidiary, Southwest Georgia Bank, offers comprehensive financial services to consumer, business, and governmental customers. The current banking facilities include the main office located in Colquitt County, and branch offices located in Baker County, Worth County, and Lowndes County. In addition to conventional banking services, the bank provides investment planning and management, trust management, mortgage banking, and commercial and individual insurance products. Insurance products and advice are provided by Southwest Georgia Insurance Services which is located in Colquitt County. Mortgage banking for primarily commercial properties is provided by Empire Financial Services, Inc., a mortgage banking services firm.
More information on Southwest Georgia Financial Corp. and Southwest Georgia Bank can be found at its website: www.sgfc.com.
SAFE HARBOR STATEMENT
This news release contains forward-looking statements, as defined by federal securities laws, including statements about the Company’s financial outlook. These statements are based on current expectations and are provided to assist in the understanding of future financial performance. Such performance involves risks and uncertainties that may cause actual results to differ materially from those expressed or implied in any such statements. For a discussion of some risks and other factors that could cause the Company’s actual results to differ materially from such statements, please refer to the Company’s filings with the Securities and Exchange Commission, including its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q under the sections entitled “Forward-Looking Statements” and “Risk Factors”. The Company undertakes no obligation to update any forward-looking statements as a result of new information, future events or otherwise, except as otherwise required by law.
Financial tables follow.
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SOUTHWEST GEORGIA FINANCIAL CORPORATION
CONSOLIDATED STATEMENT OF CONDITION
(Dollars in thousands except per share data)
| (Unaudited) | (Audited) | (Audited) | ||||||||||
| December 31, | December 31, | December 31, | ||||||||||
| 2014 | 2013 | 2012 | ||||||||||
| ASSETS | ||||||||||||
| Cash and due from banks | $ | 6,783 | $ | 7,074 | $ | 8,646 | ||||||
| Interest-bearing deposits in banks | 5,776 | 28,296 | 27,935 | |||||||||
| Certificates of deposit in other banks | 1,470 | 3,430 | 3,920 | |||||||||
| Investment securities available for sale | 53,838 | 36,461 | 21,672 | |||||||||
| Investment securities held to maturity | 61,588 | 59,624 | 59,863 | |||||||||
| Federal Home Loan Bank stock, at cost | 1,560 | 1,721 | 1,448 | |||||||||
| Loans, less unearned income and discount | 224,400 | 218,688 | 204,137 | |||||||||
| Allowance for loan losses | (3,114 | ) | (3,078 | ) | (2,845 | ) | ||||||
| Net loans | 221,286 | 215,610 | 201,292 | |||||||||
| Premises and equipment | 11,756 | 10,336 | 10,149 | |||||||||
| Foreclosed assets, net | 274 | 406 | 1,690 | |||||||||
| Intangible assets | 66 | 111 | 327 | |||||||||
| Bank owned life insurance | 5,104 | 4,980 | 4,767 | |||||||||
| Other assets | 4,779 | 5,846 | 5,472 | |||||||||
| Total assets | $ | 374,280 | $ | 373,895 | $ | 347,181 | ||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||
| Deposits: | ||||||||||||
| NOW accounts | $ | 22,890 | $ | 23,088 | $ | 28,881 | ||||||
| Money market | 99,918 | 89,934 | 77,133 | |||||||||
| Savings | 28,156 | 28,792 | 25,988 | |||||||||
| Certificates of deposit $100,000 and over | 31,367 | 36,956 | 36,591 | |||||||||
| Other time accounts | 46,300 | 49,836 | 55,098 | |||||||||
| Total interest-bearing deposits | 228,631 | 228,606 | 223,691 | |||||||||
| Noninterest-bearing deposits | 81,343 | 81,829 | 68,071 | |||||||||
| Total deposits | 309,974 | 310,435 | 291,762 | |||||||||
| Other borrowings | 5,133 | 11,800 | 2,000 | |||||||||
| Long-term debt | 22,067 | 17,200 | 20,000 | |||||||||
| Accounts payable and accrued liabilities | 2,771 | 3,040 | 3,544 | |||||||||
| Total liabilities | 339,945 | 342,475 | 317,306 | |||||||||
| Shareholders' equity: | ||||||||||||
| Common stock - par value $1; 5,000,000 shares | ||||||||||||
| authorized; 4,293,835 shares issued (*) | 4,294 | 4,294 | 4,294 | |||||||||
| Additional paid-in capital | 31,701 | 31,701 | 31,701 | |||||||||
| Retained earnings | 25,015 | 22,927 | 20,664 | |||||||||
| Accumulated other comprehensive income | (561 | ) | (1,388 | ) | (670 | ) | ||||||
| Total | 60,449 | 57,534 | 55,989 | |||||||||
| Treasury stock - at cost (**) | (26,114 | ) | (26,114 | ) | (26,114 | ) | ||||||
| Total shareholders' equity | 34,335 | 31,420 | 29,875 | |||||||||
| Total liabilities and shareholders' equity | $ | 374,280 | $ | 373,895 | $ | 347,181 | ||||||
| * Common stock - shares outstanding | 2,547,837 | 2,547,837 | 2,547,837 | |||||||||
| ** Treasury stock - shares | 1,745,998 | 1,745,998 | 1,745,998 | |||||||||
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SOUTHWEST GEORGIA FINANCIAL CORPORATION
CONSOLIDATED INCOME STATEMENT (unaudited*)
(Dollars in thousands except per share data)
| For the Three Months | For the Twelve Months | |||||||||||||||
| Ended December 31, | Ended December 31, | |||||||||||||||
| 2014* | 2013* | 2014* | 2013 | |||||||||||||
| Interest income: | ||||||||||||||||
| Interest and fees on loans | $ | 3,061 | $ | 3,162 | $ | 12,135 | $ | 12,219 | ||||||||
| Interest and dividend on securities available for sale | 280 | 178 | 1,069 | 673 | ||||||||||||
| Interest on securities held to maturity | 333 | 357 | 1,353 | 1,435 | ||||||||||||
| Dividends on Federal Home Loan Bank stock | 18 | 12 | 70 | 39 | ||||||||||||
| Interest on deposits in banks | 12 | 16 | 52 | 66 | ||||||||||||
| Interest on certificates of deposit in other banks | 6 | 10 | 33 | 43 | ||||||||||||
| Total interest income | 3,710 | 3,735 | 14,712 | 14,475 | ||||||||||||
| Interest expense: | ||||||||||||||||
| Interest on deposits | 184 | 213 | 750 | 882 | ||||||||||||
| Interest on other borrowings | 16 | 98 | 169 | 295 | ||||||||||||
| Interest on long-term debt | 114 | 111 | 436 | 486 | ||||||||||||
| Total interest expense | 314 | 422 | 1,355 | 1,663 | ||||||||||||
| Net interest income | 3,396 | 3,313 | 13,357 | 12,812 | ||||||||||||
| Provision for loan losses | 75 | 105 | 330 | 420 | ||||||||||||
| Net interest income after provision for losses on loans | 3,321 | 3,208 | 13,027 | 12,392 | ||||||||||||
| Noninterest income: | ||||||||||||||||
| Service charges on deposit accounts | 312 | 354 | 1,275 | 1,278 | ||||||||||||
| Income from trust services | 53 | 63 | 241 | 228 | ||||||||||||
| Income from retail brokerage services | 105 | 83 | 376 | 338 | ||||||||||||
| Income from insurance services | 332 | 349 | 1,324 | 1,328 | ||||||||||||
| Income from mortgage banking services | 111 | 238 | 645 | 940 | ||||||||||||
| Net gain (loss) on the sale or disposition of assets | 32 | 0 | 89 | (68 | ) | |||||||||||
| Net gain on the sale of securities | 0 | 312 | 293 | 312 | ||||||||||||
| Other income | 170 | 175 | 743 | 735 | ||||||||||||
| Total noninterest income | 1,115 | 1,574 | 4,986 | 5,091 | ||||||||||||
| Noninterest expense: | ||||||||||||||||
| Salary and employee benefits | 2,086 | 2,164 | 8,359 | 8,455 | ||||||||||||
| Occupancy expense | 280 | 252 | 1,061 | 1,025 | ||||||||||||
| Equipment expense | 237 | 218 | 896 | 902 | ||||||||||||
| Data processing expense | 290 | 271 | 1,130 | 1,097 | ||||||||||||
| Amortization of intangible assets | 4 | 54 | 45 | 216 | ||||||||||||
| Other operating expense | 728 | 638 | 2,879 | 2,651 | ||||||||||||
| Total noninterest expense | 3,625 | 3,597 | 14,370 | 14,346 | ||||||||||||
| Income before income tax expense | 811 | 1,185 | 3,643 | 3,137 | ||||||||||||
| Provision for income taxes | 149 | 203 | 739 | 365 | ||||||||||||
| Net income | $ | 662 | $ | 982 | $ | 2,904 | $ | 2,772 | ||||||||
| Net income per share, basic | $ | 0.26 | $ | 0.39 | $ | 1.14 | $ | 1.09 | ||||||||
| Net income per share, diluted | $ | 0.26 | $ | 0.39 | $ | 1.14 | $ | 1.09 | ||||||||
| Dividends paid per share | $ | 0.08 | $ | 0.08 | $ | 0.32 | $ | 0.20 | ||||||||
| Basic weighted average shares outstanding | 2,547,837 | 2,547,837 | 2,547,837 | 2,547,837 | ||||||||||||
| Diluted weighted average shares outstanding | 2,547,837 | 2,547,837 | 2,547,837 | 2,547,837 | ||||||||||||
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SOUTHWEST GEORGIA FINANCIAL CORPORATION
Financial Highlights
(Dollars in thousands except per share data)
| At December 31 | 2014 | 2013 | ||||||
| Assets | $ | 374,280 | $ | 373,895 | ||||
| Loans, less unearned income & discount | $ | 224,400 | $ | 218,688 | ||||
| Deposits | $ | 309,974 | $ | 310,435 | ||||
| Shareholders' equity | $ | 34,335 | $ | 31,420 | ||||
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
| 2014 | 2013 | 2014 | 2013 | |||||||||||||
| Performance Data & Ratios | ||||||||||||||||
| Net income | $ | 662 | $ | 982 | $ | 2,904 | $ | 2,772 | ||||||||
| Earnings per share, basic | $ | 0.26 | $ | 0.39 | $ | 1.14 | $ | 1.09 | ||||||||
| Earnings per share, diluted | $ | 0.26 | $ | 0.39 | $ | 1.14 | $ | 1.09 | ||||||||
| Dividends paid per share | $ | 0.08 | $ | 0.08 | $ | 0.32 | $ | 0.20 | ||||||||
| Return on assets | 0.69 | % | 1.05 | % | 0.76 | % | 0.76 | % | ||||||||
| Return on equity | 7.75 | % | 12.50 | % | 8.74 | % | 9.02 | % | ||||||||
| Net interest margin (tax equivalent) | 4.03 | % | 4.02 | % | 3.99 | % | 4.02 | % | ||||||||
| Dividend payout ratio | 30.77 | % | 20.75 | % | 28.08 | % | 18.38 | % | ||||||||
| Efficiency ratio | 77.30 | % | 70.91 | % | 75.43 | % | 77.00 | % | ||||||||
| Asset Quality Data & Ratios | ||||||||||||||||
| Total nonperforming loans | $ | 786 | $ | 913 | $ | 786 | $ | 913 | ||||||||
| Total nonperforming assets | $ | 1,060 | $ | 1,363 | $ | 1,060 | $ | 1,363 | ||||||||
| Net loan charge offs | $ | 157 | $ | 127 | $ | 293 | $ | 187 | ||||||||
| Reserve for loan losses to total loans | 1.39 | % | 1.41 | % | 1.39 | % | 1.41 | % | ||||||||
| Nonperforming loans/total loans | 0.35 | % | 0.42 | % | 0.35 | % | 0.42 | % | ||||||||
| Nonperforming assets/total assets | 0.28 | % | 0.36 | % | 0.28 | % | 0.36 | % | ||||||||
| Net charge offs / average loans | 0.28 | % | 0.23 | % | 0.13 | % | 0.09 | % | ||||||||
| Capital Ratios | ||||||||||||||||
| Average common equity to average total assets | 8.97 | % | 8.39 | % | 8.70 | % | 8.41 | % | ||||||||
| Tier 1 capital ratio | 14.45 | % | 14.17 | % | 14.45 | % | 14.17 | % | ||||||||
| Tier 1 leverage ratio | 9.14 | % | 8.73 | % | 9.14 | % | 8.73 | % | ||||||||
| Total risk based capital ratio | 15.70 | % | 15.44 | % | 15.70 | % | 15.44 | % | ||||||||
| Book value per share | $ | 13.48 | $ | 12.33 | $ | 13.48 | $ | 12.33 | ||||||||
| Tangible book value per share | $ | 13.45 | $ | 12.29 | $ | 13.45 | $ | 12.29 | ||||||||
| Quarterly | 4th Qtr | 3rd Qtr | 2nd Qtr | 1st Qtr | 4th Qtr | |||||||||||||||
| Averages | 2014 | 2014 | 2014 | 2014 | 2013 | |||||||||||||||
| Assets | $ | 381,239 | $ | 374,509 | $ | 384,745 | $ | 387,889 | $ | 374,542 | ||||||||||
| Loans, less unearned income & discount | $ | 223,906 | $ | 225,934 | $ | 223,348 | $ | 219,971 | $ | 222,723 | ||||||||||
| Deposits | $ | 313,595 | $ | 309,953 | $ | 326,773 | $ | 322,888 | $ | 310,406 | ||||||||||
| Equity | $ | 34,186 | $ | 33,579 | $ | 32,926 | $ | 32,184 | $ | 31,436 | ||||||||||
| Return on assets | 0.69 | % | 0.86 | % | 0.77 | % | 0.72 | % | 1.05 | % | ||||||||||
| Return on equity | 7.75 | % | 9.57 | % | 8.95 | % | 8.71 | % | 12.50 | % | ||||||||||
| Net income | $ | 662 | $ | 804 | $ | 737 | $ | 701 | $ | 982 | ||||||||||
| Net income per share, basic | $ | 0.26 | $ | 0.32 | $ | 0.28 | $ | 0.28 | $ | 0.39 | ||||||||||
| Net income per share, diluted | $ | 0.26 | $ | 0.32 | $ | 0.28 | $ | 0.28 | $ | 0.39 | ||||||||||
| Dividends paid per share | $ | 0.08 | $ | 0.08 | $ | 0.08 | $ | 0.08 | $ | 0.08 | ||||||||||
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