EXHIBIT 99.1

To Form 8-K dated July 23, 2015

 

NEWS RELEASE

 

SEACOAST BANKING CORPORATION OF FLORIDA

 

CONTACT:

Stephen Fowle, EVP and CFO

(772) 463-8977

steve.fowle@seacoastbank.com

 

Seacoast Q2 Net Income Rises More Than 200% Year-over-Year to $5.8 Million, or $0.18 per Share

 

Favorable Results Reflect Continued Revenue Growth from Accelerate Commercial Banking and Expanded Customer Acquisition, Cross-Selling and Efficiency Initiatives

 

Second Quarter 2015 Earnings Highlights

·

Revenues increased $1.5 million, or 4.5%, linked quarter to $34.5 million, and $11.9 million, or 53%, compared to Q2 2014,

·

Fee income increased $1.5 million, or 21%, sequentially and $3.0 million, or 50%, year-over-year,

·

Net interest margin increased 40 basis points year-over-year to 3.50%, reflecting improved balance sheet mix particularly due to increased lending,

·

Adjusted net income excluding merger costs and other adjustments1 increased 106% to $6.2 million, or $ 0.19 per diluted share, compared to $3.0 million, or $0.12 per diluted share, in Q2 2014.

 

Second Quarter 2015 Growth Highlights

·

Loans increased $83 million or 18% annualized compared to Q1 2015, and rose 45% year-over-year. Excluding the acquisition of The BANKshares, loans increased $238 million or 18% compared to Q2 2014,

·

Total households increased a strong 5%, annualized from Q1 and 20% compared to Q2 2014. Excluding BANKshares customers, year-over-year household growth was 5.3%,

 

¹ Non-GAAP measure, see “Explanation of Certain Unaudited Non-GAAP Financial Measures”

 

 

·

Achieved record levels of business and consumer lending during the quarter, reflecting success in Accelerate Commercial Banking, as well as digitally-enabled marketing and cross-selling initiatives.

·

Closed the Grand Bancshares, Inc. acquisition and completed the conversion of Grand’s customers over the July 17 weekend, adding approximately $190 million in deposits and $121 million in gross loans in the attractive Palm Beach market.

 

STUART, Fla., July 23, 2015 /PRNewswire/ — Seacoast Banking Corporation of Florida (NASDAQ: SBCF) today reported results for the second quarter of 2015. Second quarter revenue rose $1.5 million, or 4.5%, to $34.5 million compared to $33.0 million in the prior quarter. Net income increased $3.9 million, or 203%, to $5.8 million, compared to the second quarter of 2014, and decreased slightly from $5.9 million in the first quarter 2015. The company reported $0.18 diluted net income per common share compared with $0.07 in the second quarter last year, and $0.18 sequentially in the first quarter of 2015.

 

Net income improved 177% to $11.7 million, or $0.35 per diluted common share, for the first half of 2015 from $4.2 million, or $0.16 per diluted common share, for the first half of 2014.

 

“Our strategic focus on improving profitability, investing for growth and managing risk continues to yield consistent results, as demonstrated by our second quarter performance,” said Dennis S. Hudson, III, Chairman and CEO. “Investments to expand our Accelerate business banking platform, combined with increased digital marketing and cross sell efforts company-wide, are yielding strong results that demonstrate our value proposition and community bank approach are resonating in the marketplace.”

 

 

“With our success comes additional expense, reflecting our growth and investment for the future,” Hudson continued. “These expenses include the addition of a receivables funding team from First Growth Capital (FGC), volume-related commissions, brand-based marketing in our Orlando markets and key senior management hires.”

 

“We look forward to sustained growth as we leverage our recent acquisitions, most recently welcoming the customers and customer-serving associates from Grand Bancshares, Inc., which we successfully closed and integrated last week,” Hudson concluded.

 

“Revenue increases drove the improvement in Seacoast’s profitability and reflect significant organic growth, as well as benefits from acquisition activity,” said Stephen A. Fowle, Executive Vice President and Chief Financial Officer. “We continue to produce positive trends in loan production, fee income, and household growth, including record loan originations and record new household growth through the first half of the year.  During the quarter, we achieved outsized loan growth and strong fee income increases despite a seasonally slow quarter. Net interest income, taking into consideration an expected decrease in acquired loan accretion, also showed significant continued momentum.”

 

FINANCIAL HIGHLIGHTS (Dollars in thousands except per share data)		2Q15				1Q15				4Q14				3Q14				2Q14
Total Assets		$	3,233,588			$	3,231,956			$	3,093,335			$	2,361,813			$	2,294,156
Loans			1,937,399				1,854,487				1,821,885				1,391,082				1,335,192
Deposits			2,605,177				2,609,825				2,416,534				1,808,550				1,805,537
Net Income (Loss) Available to Common  Shareholders			5,805				5,859				(1,517	)			2,996				1,918
Diluted Earnings Per Share			0.18				0.18				(0.05	)			0.12				0.07
Return on Average Assets			0.72	%			0.75	%			(0.20	%)			0.52	%			0.33	%
Net Interest Margin			3.50				3.62				3.56				3.17				3.10
Efficiency Ratio			68.6				68.3				104.5				82.8				89.4
Pretax, Pre-provision Income (1)		$	10,224			$	9,832			($	2,029	)		$	3,832			$	1,938
Average Diluted Shares Outstanding (000)			33,234				33,136				33,124				26,026				25,998
Adjusted Net Income (1)		$	6,172			$	6,177			$	4,179			$	3,286			$	2,990
Adjusted Diluted Earnings Per Share (1)			0.19				0.19				0.13				0.13				0.12
Adjusted Return on Average Assets (1)			0.77	%			0.79	%			0.55	%			0.57	%			0.52	%
Adjusted Efficiency Ratio (1)			67.5				67.5				74.8				79.6				82.0
Adjusted Pretax, Pre-provision Income (1)		$	10,815			$	10,342			$	7,464			$	4,341			$	3,821
Annualized Adjusted Core Operating Expenses as a Percent of Average Assets (1)			2.91	%			2.88	%			3.13	%			3.21	%			3.24	%

 

 

Acquisitions Update

“Our 2014 acquisition of The BANKshares, continues to be a home run, opening the vibrant greater Orlando markets to us,” said Hudson. “Orlando remains one of the strongest markets in Florida, and we remain bullish on this area for growth and profitability.”

 

“We are also excited to welcome the customers and customer-service team members from Grand Bancshares, Inc., which we successfully closed and integrated into our platform just last week,” Hudson continued. “Our acquisition strategy is complementing our legacy banking business and is successfully adding new customers and opening new markets, fueling robust franchise growth.”

 

Florida Economic Update

“Our Florida markets, spanning much of the central Atlantic coastline and the greater Orlando markets, are growing at very healthy rates,” said Hudson. According to the June 2015 American Banker Magazine, “Florida is once again outgrowing the rest of the country, and some of its thriving community banks are emerging as real contenders to be the next state flagship.”

 

 

“Nonfarm employment rose on a year-over-year basis in 23 of Florida’s 24 metropolitan areas and was unchanged in one area, Homosassa Springs. The largest gains continue to be in the Orlando (47,200 new jobs), Tampa-St Petersburg (32,900 jobs) and Miami (27,900 jobs) metropolitan areas. Fort Lauderdale (27,300 jobs), West Palm Beach (15,900 jobs) and Jacksonville (15,100 jobs) round out Florida’s big 6 metro areas,” according to the U.S. Department of Labor and Wells Fargo Securities, LLC.

 

“Our move into Orlando is going very well, and is providing excellent opportunities for growth,” Hudson continued. According to the Orlando Business Journal, “It was another record quarter for Florida tourism numbers, as the Sunshine State welcomed 28.4 million visitors in the first quarter, an increase of 6.2% over the same period a year ago. (May 15, 2015) “Visit Orlando reports that more than 62 million people visited Orlando in 2014, marking an all-time new record for the U.S. travel industry.” (April 9, 2015) As an additional indication of the Orlando market growth, Orlando Realtors.org reported, “A leap in "normal" transactions has boosted Orlando area home sales more than 21% over June 2014 and to its highest number —3,435— since the Orlando Regional REALTOR® Association began recording sales. In addition to skyrocketing sales, the median price for existing homes sold in June increased 7.73%.”

 

 

Income Statement Highlights

 

Net Interest Income and Margin, up 40 basis points from 2Q14, Normalizes as Expected from the First Quarter

Net interest income for the quarter totaled $25.8 million, a $9.0 million or 54% increase from second quarter 2014 levels. Net interest income held flat with Q1 levels despite a significant amount of excess purchase loan accretion recognized in the first quarter. Strong loan growth (a $55.0 million average balance increase) helped offset the impact of reduced purchased loan accretion. Net interest margin increased 40 basis points from prior year levels to 3.50%. Margin decreased twelve basis points sequentially, also related to purchased loan accretion. Purchased loan accretion for the second quarter is near expected levels, although the timing of such loan accretion is expected to be unpredictable.

 

Noninterest Income Boosted by New Account Growth

Noninterest income increased $3.0 million or 50% from a year ago to $8.8 million and $1.5 million or 21% above the first quarter of 2015. Year-over-year growth in all categories of service fee income reflects strength in customer acquisition and cross sell, as well as benefits of the successful BANKshares customer integration. Linked-quarter noninterest income improvement was fueled by continued household growth. Service charges on deposit accounts increased $113,000 and interchange income grew $296,000 from the first quarter of 2015. Marine finance fees also grew $295,000 or 150% from the first quarter. Adjusting for the gain on a participated loan of $725,000 during the quarter, fee income increased $813,000 or 11%. Accounting treatment for $725,000 of discount accreted from the participated loan required this income to be included in other operating income rather than taken through the margin.

 

 

Noninterest Expense Increases from Core Growth and Acquisition

Seacoast’s efficiency ratio improved to 68.6% in the second quarter of 2015 from 89.4% during the prior year. This decrease is related to improved operating leverage, as strong revenue growth significantly outpaced expenses.

 

Noninterest expense increased $3.6 million or 17% from prior year levels and $1.1 million or 5% from the first quarter 2015. Year-over-year expense increases reflect the acquisition of The BANKshares, offset by planned expense reduction initiatives. Linked quarter increases reflect investment in our franchise, and variable expenses related to a strong quarter of production. Notable increases include: the acquisition of FGC during the second quarter 2015 which contributed approximately $351,000 in expense; production-driven commission expense which added approximately $375,000; marketing expense focused on customer acquisition and for corporate branding in BANKshare’s Orlando footprint which contributed $250,000 to the increase.

 

Merger related expenses totaled $337,000 in the second quarter 2015 compared to $275,000 in the first quarter of 2015 and $1.2 million in the second quarter 2014.

 

 

Balance Sheet Highlights

 

Year-over-Year Deposit Growth Reflects Marketing Wins and Successful Acquisitions

Total deposits increased 44.3% to $2.61 billion at June 30, 2015, from year ago levels. Core customer funding increased to $2.47 billion at June 30, 2015, a $781.0 million increase from the second quarter of 2014. Noninterest demand deposits grew $15.1 million, or 1.9% from the first quarter and $298.6 million or 58.6% from the second quarter of 2014. As a result, noninterest demand deposits increased to 31.0% of total deposits, up from 28.2% one year ago. Excluding the acquisition, core customer funding increased by $333.6 million or 19.8% from one year ago and total deposits increased $283.3 million or 15.7% from one year ago. A 5% linked quarter household growth rate was offset by seasonal deposit balance decreases.

 

(Dollars in thousands)		Second Quarter 2015				First Quarter 2015				Fourth Quarter 2014				Third Quarter 2014				Second Quarter 2014
Customer Relationship Funding
Noninterest demand		$	808,429			$	793,336			$	725,238			$	522,001			$	509,798
Interest-bearing demand			599,268				634,854				652,353				479,827				493,927
Money market			621,973				596,600				450,172				344,726				335,246
Savings			282,588				272,963				264,738				215,076				208,333
Time certificates of deposit			292,919				312,072				324,033				246,920				258,233
Total deposits			2,605,177				2,609,825				2,416,534				1,808,550				1,805,537
Customer sweep accounts			157,676				170,023				153,640				124,436				141,662
Total core customer funding (1)			2,469,934				2,467,776				2,246,141				1,686,066				1,688,966
Demand deposit mix (noninterest bearing)			31.0	%			30.4	%			30.0	%			28.9	%			28.2	%

(1)

Total deposits and customer sweep accounts, excluding time certificates of deposit.

 

 

Loan Growth and Pipelines at Trailing-Four-Quarter Highs

Total loans were $1.94 billion at June 30, 2015, up $602.2 million from a year ago. Excluding loans acquired in the BANKshares transaction, loans increased $237.9 million or 17.8% from the prior year’s second quarter.

 

Commercial loan originations for the quarter were a strong $85.8 million, increasing $24.5 million or 39.9% over the first quarter and $32.6 million or 61.2% over the second quarter 2014. The commercial pipeline (in underwriting and approval or approved and not yet closed) totaled $108.5 million at June 30, 2015, yet again the highest in the trailing four quarters.

 

Closed residential production totaled $81.8 million compared to $55.8 million in the first quarter and $61.2 million in the second quarter of 2014. The residential pipeline continued to climb, totaling $53.9 million at June 30, 2015 compared to $48.5 million at March 31, 2014 and $28.3 million one year ago. Consumer loan and small business originations (inclusive of lines of credit) totaled $55.3 million in the second quarter of 2015 compared to $38.9 in the first quarter and $18.0 million one year ago.

 

(Dollars in thousands)		2Q 15				1Q15				4Q14				3Q14				2Q14
Commercial pipeline		$	108,538			$	82,143			$	60,136			$	45,534			$	58,168
Commercial loans closed			85,815				61,357				94,719				72,630				53,250
Total Commercial loan originations and pipeline		$	194,353			$	143,500			$	154,855			$	118,164			$	111,418
Residential pipeline		$	53,902			$	48,485			$	21,351			$	22,588			$	28,345
Residential loans retained			45,596				23,951				31,598				31,781				33,203
Residential loans sold			36,182				31,896				26,336				34,228				27,994
Total Residential loan originations and pipeline		$	135,680			$	104,332			$	79,285			$	88,597			$	89,542

 

 

Other Highlights

 

Credit Quality Maintains Strong Trends

The provision for loan losses increased to $855,000 for the second quarter of 2015, up from a $1.4 million recapture in the second quarter 2014 and a $422,000 or 97% increase from $433,000 recorded in the first quarter 2015. The second quarter provision is attributable to strong loan growth during the quarter. The allowance for loan losses for non-acquired loans was 1.10% of total loans, compared to 1.13% in the first quarter 2015.

 

Additional highlights include:

·

Nonperforming loans to total loans outstanding at the end of the second quarter was 1.0%, down from 1.6% at June 30, 2014;

·

Nonperforming assets to total assets declined to 0.8%, compared to 1.2% a year ago.

 

Capital Ratios Continue to Improve from Earnings Momentum

Tangible book value and book value per share each increased by $0.13 per share from the prior quarter to $8.87 and $9.84, respectively at the end of the second quarter. Average tangible common equity to assets was a strong 9.24% for the second quarter 2015.

 

Conference Call Information

Seacoast will host a conference call on Friday, July 24, 2015 at 1:00 p.m. (Eastern Time) to discuss the earnings results. Investors may call in (toll-free) by dialing (888) 517-2513 (passcode: 7789246; host: Dennis S. Hudson). Slides will be used during the conference call and may be accessed at Seacoast's website at SeacoastBanking.com by selecting "Presentations" under the heading "Investor Services." A replay of the call will be available for one month, beginning late afternoon of July 24, by dialing (888) 843-7419 (domestic), using the passcode 7789246.

 

 

Alternatively, individuals may listen to the live webcast of the presentation by visiting Seacoast's website at SeacoastBanking.com. The link is located in the subsection "Presentations" under the heading "Investor Services." Beginning the afternoon of July 24, an archived version of the webcast can be accessed from this same subsection of the website. The archived webcast will be available for one year.

 

About Seacoast Banking Corporation of Florida (NASDAQ: SBCF)

Seacoast Banking Corporation of Florida is one of the largest community banks headquartered in Florida with approximately $3.2 billion in assets and $2.6 billion in deposits as of June 30, 2015. The Company provides integrated financial services including commercial and retail banking, wealth management, and mortgage services to customers through advanced banking solutions, 44 traditional branches of its locally-branded wholly-owned subsidiary bank, Seacoast Bank, and five commercial banking centers. Offices stretch from Ft. Lauderdale, Boca Raton and West Palm Beach north through the Space Coast of Florida, into Orlando and Central Florida, and west to Okeechobee and surrounding counties. More information about the Company is available at SeacoastBanking.com.

 

Sources:

 

http://www.americanbanker.com/magazine/2015-06-01-1074530-1.html

https://www08.wellsfargomedia.com/downloads/pdf/com/insights/economics/regional-reports/FL_Employment_07172015.pdf

 

 

http://www.floridatoday.com/story/news/local/2015/05/15/record-tourism-numbers-sunshine-state/27367565/

http://www.bizjournals.com/orlando/blog/2015/04/orlando-becomes-first-destination-to-surpass-60m.html

http://www.orlandorealtors.org/resource/resmgr/docs_market_pulse/MarketPulse072015.html

 

Cautionary Notice Regarding Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results, ability to realized deferred tax assets, cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls and for integration of banks that we have acquired, as well as statements with respect to Seacoast's objectives, expectations and intentions and other statements that are not historical facts. Actual results may differ from those set forth in the forward-looking statements.

 

Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements.

 

You can identify these forward-looking statements through our use of words such as "may," "will," "anticipate," "assume," "should," "support", "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "further", "point to," "project," "could," "intend" or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality; governmental monetary and fiscal policies, as well as legislative, tax and regulatory changes; changes in accounting policies, rules and practices; the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses. The risks of mergers and acquisitions, include, without limitation: unexpected transaction costs, including the costs of integrating operations; the risks that the businesses will not be integrated successfully or that such integration may be more difficult, time-consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the merger being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectations; the risks of customer and employee loss and business disruption, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures and solicitations of customers by competitors; as well as the difficulties and risks inherent with entering new markets.

 

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2014, under "Special Cautionary Notice Regarding Forward-looking Statements" and "Risk Factors", and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov.

 

 

Explanation of Certain Unaudited Non-GAAP Financial Measures

This press release contains financial information determined by methods other than Generally Accepted Accounting Principles ("GAAP"). The financial highlights provide reconciliations between GAAP net income and adjusted net income, GAAP income and adjusted pretax, pre-provision income. Management uses these non-GAAP financial measures in its analysis of the Company's performance and believes these presentations provide useful supplemental information, and a clearer understanding of the Company's performance. The Company believes the non-GAAP measures enhance investors' understanding of the Company's business and performance. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might calculate these measures differently. The Company provides reconciliations between GAAP and these non-GAAP measures. These disclosures should not be considered an alternative to GAAP.

 

To better evaluate its earnings, the Company removes certain items to arrive at djusted net income, Adjusted pretax, pre-provision income and Adjusted diluted earnings per share (non-GAAP measures) as detailed in the table below:

 

(Dollars in thousands except per share data)		Second Quarter 2015				First Quarter 2015				Fourth Quarter 2014				Third Quarter 2014				Second Quarter 2014
Net income		$	5,805			$	5,859			($	1,517	)		$	2,996			$	1,918
Severance			29				12				478				328				181
Merger related charges			337				275				2,722				399				1,234
Branch closure charges and costs related to expense initiatives			0				0				4,261				68				114
Marketing and brand refresh expense			0				0				697				0				0
Stock compensation expense and other incentive costs related to improved outlook			0				0				1,213				0				0
Security (gains)			0				0				(108	)			(344	)			0
Miscellaneous losses (gains)			0				0				119				(45	)			144
Recovery of nonaccrual loan interest			0				0				0				(192	)			0
Net loss on OREO and repossessed assets			53				81				9				156				92
Asset dispositions expense			173				143				103				139				118
Effective tax rate on adjustments			(225	)			(193	)			(3,798	)			(219	)			(811	)
Adjusted Net Income (1)			6,172				6,177				4,179				3,286				2,990
Provision (recapture) for loan losses			855				433				118				(1,425	)			(1,444	)
Income taxes			3,788				3,732				3,167				2,480				2,275
Adjusted pretax, pre-provision income (1)		$	10,815			$	10,342			$	7,464			$	4,341			$	3,821
Adjusted earnings per diluted share (1)		$	0.19			$	0.19			$	0.13			$	0.13			$	0.12
Average shares outstanding (000)			33,234				33,136				33,124				26,026				25,998

 

(1)

Non-GAAP measure

 

 

 

FINANCIAL  HIGHLIGHTS	(Unaudited)		07/28/15
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES
(Dollars in thousands, except share data)

 

		Three Months Ended												Six Months Ended
		June 30,				March 31,				June 30,				June 30,				June 30,
		2015				2015				2014				2015				2014
Summary of Earnings
Net income (loss)		$	5,805			$	5,859			$	1,918			$	11,664			$	4,217
Net interest income  (1)			25,788				25,834				16,779				51,622				33,056
Net interest margin  (1), (2)			3.50				3.62				3.10				3.56				3.09
																			.
Performance Ratios
Return on average assets-GAAP basis (2), (3)			0.72	%			0.75	%			0.33	%			0.74	%			0.37	%
Return on average shareholders' equity-GAAP basis (2), (3)			7.13				7.42				3.25				7.27				3.63
Return on average tangible shareholders' equity-GAAP basis (2), (3), (4)			8.20				8.51				3.47				8.35				3.86
Efficiency ratio (5)			68.57				68.33				89.42				68.45				86.91
Noninterest income to total revenue			25.63				22.13				26.06				23.92				25.80
Per Share Data
Net income (loss) diluted-GAAP basis		$	0.18			$	0.18			$	0.07			$	0.35			$	0.16
Net income (loss) basic-GAAP basis			0.18				0.18				0.07				0.35				0.16
Book value per share common			9.84				9.71				9.02				9.84				9.02
Tangible book value per share			8.87				8.74				9.00				8.87				9.00
Cash dividends declared			0.00				0.00				0.00				0.00				0.00

 

(1)

Calculated on a fully taxable equivalent basis using amortized cost.

(2)

These ratios are stated on an annualized basis and are not necessarily indicative of future periods.

(3)

The calculation of ROA and ROE do not include the mark-to-market unrealized gains (losses) because the unrealized gains (losses) are not included in net income (loss).

(4)

The Company defines tangible common equity as total shareholder's equity less intangible assets.

(5)

Defined as (noninterest expense less foreclosed property expense and amortization of intangibles) divided by net operating revenue (net interest income on a fully taxable equivalent basis plus noninterest income excluding securities gains).

 

 

FINANCIAL  HIGHLIGHTS

SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES

 

		June 30,				March 31,				June 30,
(Dollars in thousands, except share data)		2015				2015				2014
Selected Financial Data
Total assets		$	3,233,588			$	3,231,956			$	2,294,156
Securities available for sale (at fair value)			762,086				730,232				518,353
Securities held for investment (at amortized cost)			214,777				223,061				156,498
Net loans			1,918,608				1,836,766				1,317,052
Deposits			2,605,177				2,609,825				1,805,537
Total shareholders' equity			326,856				321,844				234,439
Average Balances (Year-to-Date)
Total average assets		$	3,188,334			$	3,151,132			$	2,295,983
Less: intangible assets			31,707				31,221				525
Total average tangible assets		$	3,156,627			$	3,119,911			$	2,295,458
Total average equity		$	323,359			$	320,346			$	234,214
Less: intangible assets			31,707				31,221				525
Total average tangible equity		$	291,652			$	289,125			$	233,689
Credit Analysis
Net charge-offs (recoveries) year-to-date - non-acquired loans		$	(621	)		$	(263	)		$	(251	)
Net charge-offs year-to-date - acquired loans			189				46				-
Total net charge-offs (recoveries) year-to-date		$	(432	)		$	(217	)		$	(251	)
Net charge-offs (recoveries) to average loans (annualized) - non-acquired loans			(0.07	)%			(0.06	)%			(0.04	)%
Net charge-offs to average loans (annualized) - acquired loans			0.02				0.01				-
Total net charge-offs (recoveries) to average loans (annualized)			(0.05	)			(0.05	)			(0.04	)
Loan loss provision (recapture) year-to-date - non-acquired loans		$	563			$	292			$	(2,179	)
Loan loss provision year-to-date - acquired loans			725				141				-
Total loan loss provision (recapture) year-to-date		$	1,288			$	433			$	(2,179	)
Allowance to loans at end of period - non-acquired loans			1.10	%			1.13	%			1.36	%
Discount for credit losses to acquired loans at end of period			3.32				3.56				-
Nonperforming loans - non-acquired loans		$	15,054			$	16,860			$	21,745
Nonperforming loans - acquired loans			4,543				4,196				-
Other real estate owned - non-acquired			4,855				4,738				6,198
Other real estate owned - acquired			1,053				1,431				-
Total nonperforming assets		$	25,505			$	27,225			$	27,943
Restructured loans (accruing)		$	23,441			$	23,847			$	28,157
Purchased noncredit impaired loans		$	275,964			$	296,839			$	-
Purchased credit impaired loans			6,562				7,119				-
Total acquired loans		$	282,526			$	303,958			$	-
Nonperforming loans to loans at end of period - non-acquired loans			0.78	%			0.91	%			1.63	%
Nonperforming loans to loans at end of period - acquired loans			0.23				0.23				-
Total nonperforming loans to loans at end of period			1.01				1.14				1.63
Nonperforming assets to total assets - non-acquired			0.62	%			0.67	%			1.22	%
Nonperforming assets to total assets - aquired			0.17				0.17				-
Total nonperforming assets to total assets			0.79				0.84				1.22

 

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME	(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

 

		Three Months Ended								Six Months Ended
		June 30,								June 30,
(Dollars in thousands, except per share data)		2015				2014				2015				2014
Interest on securities:
Taxable		$	4,977			$	3,629			$	9,875			$	7,063
Nontaxable			147				9				297				21
Interest and fees on loans			21,988				14,103				44,009				27,901
Interest on federal funds sold and other investments			249				246				498				514
Total Interest Income			27,361				17,987				54,679				35,499
Interest on deposits			524				184				925				378
Interest on time certificates			321				386				668				793
Interest on borrowed money			850				692				1,710				1,382
Total Interest Expense			1,695				1,262				3,303				2,553
Net Interest Income			25,666				16,725				51,376				32,946
Provision (recapture) for loan losses			855				(1,444	)			1,288				(2,179	)
Net Interest Income After Provision for Loan Losses			24,811				18,169				50,088				35,125
Noninterest income:
Service charges on deposit accounts			2,115				1,484				4,117				2,991
Trust fees			759				703				1,560				1,374
Mortgage banking fees			1,032				855				2,120				1,516
Brokerage commissions and fees			576				410				1,017				789
Marine finance fees			492				340				689				594
Interchange income			2,033				1,514				3,770				2,917
Other deposit based EFT fees			96				83				210				181
BOLI income			334				0				664				0
Gain on participated loan			725				0				725				0
Other			684				507				1,282				1,092
			8,846				5,896				16,154				11,454
Securities gains, net			0				0				0				17
Total Noninterest Income			8,846				5,896				16,154				11,471
Noninterest expenses:
Salaries and wages			9,301				7,768				18,090				15,392
Employee benefits			2,541				2,081				4,956				4,263
Outsourced data processing costs			2,234				1,811				4,418				3,506
Telephone / data lines			443				306				939				599
Occupancy			2,011				1,888				4,034				3,726
Furniture and equipment			819				604				1,551				1,175
Marketing			1,226				675				2,201				1,488
Legal and professional fees			1,590				2,272				3,253				3,213
FDIC assessments			520				411				1,109				797
Amortization of intangibles			315				196				630				392
Asset dispositions expense			173				118				316				246
Net loss on other real estate owned and repossessed assets			53				92				134				145
Other			3,062				2,461				5,843				4,524
Total Noninterest Expenses			24,288				20,683				47,474				39,466
Income Before Income Taxes			9,369				3,382				18,768				7,130
Income taxes			3,564				1,464				7,104				2,913
Net Income		$	5,805			$	1,918			$	11,664			$	4,217
Per share of common stock:
Net income diluted		$	0.18			$	0.07			$	0.35			$	0.16
Net income basic			0.18				0.07				0.35				0.16
Cash dividends declared			0.00				0.00				0.00				0.00
Average diluted shares outstanding			33,233,508				25,998,121				33,184,764				25,828,391
Average basic shares outstanding			32,978,006				25,826,825				32,971,670				25,659,159

 

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME	(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

 

		QUARTER
		2015								2014
(Dollars in thousands)		Second				First				Fourth				Third				Second
Interest on securities:
Taxable		$	4,977			$	4,898			$	4,728			$	3,657			$	3,629
Nontaxable			147				150				182				8				9
Interest and fees on loans			21,988				22,021				21,070				14,615				14,103
Interest on federal funds sold and other investments			249				249				292				211				246
Total Interest Income			27,361				27,318				26,272				18,491				17,987
Interest on deposits			524				401				297				189				184
Interest on time certificates			321				347				375				370				386
Interest on borrowed money			850				860				867				704				692
Total Interest Expense			1,695				1,608				1,539				1,263				1,262
Net Interest Income			25,666				25,710				24,733				17,228				16,725
Provision (recapture) for loan losses			855				433				118				(1,425	)			(1,444	)
Net Interest Income After Provision for Loan Losses			24,811				25,277				24,615				18,653				18,169
Noninterest income:
Service charges on deposit accounts			2,115				2,002				2,208				1,753				1,484
Trust fees			759				801				795				817				703
Mortgage banking fees			1,032				1,088				716				825				855
Brokerage commissions and fees			576				441				417				408				410
Marine finance fees			492				197				445				281				340
Interchange income			2,033				1,737				1,603				1,452				1,514
Other deposit based EFT fees			96				114				92				70				83
BOLI income			334				330				252				0				0
Gain on Participated Loan			725				0				0				0				0
Other			684				598				613				543				507
			8,846				7,308				7,141				6,149				5,896
Securities gains, net			0				0				108				344				0
Total Noninterest Income			8,846				7,308				7,249				6,493				5,896
Noninterest expenses:
Salaries and wages			9,301				8,789				11,676				8,064				7,768
Employee benefits			2,541				2,415				2,461				2,049				2,081
Outsourced data processing costs			2,234				2,184				3,506				1,769				1,811
Telephone / data lines			443				496				419				313				306
Occupancy			2,011				2,023				2,325				1,879				1,888
Furniture and equipment			819				732				732				628				604
Marketing			1,226				975				1,163				925				675
Legal and professional fees			1,590				1,663				2,555				1,103				2,272
FDIC assessments			520				589				476				387				411
Amortization of intangibles			315				315				446				195				196
Asset dispositions expense			173				143				103				139				118
Branch closures and branding			0				0				4,958				0				0
Net loss on other real estate owned and repossessed assets			53				81				9				156				92
Other			3,062				2,781				3,182				2,282				2,461
Total Noninterest Expenses			24,288				23,186				34,011				19,889				20,683
Income Before Income Taxes			9,369				9,399				(2,147	)			5,257				3,382
Income taxes			3,564				3,540				(630	)			2,261				1,464
Net Income		$	5,805			$	5,859			$	(1,517	)		$	2,996			$	1,918
Per share of common stock:
Net income diluted		$	0.18			$	0.18			$	(0.05	)		$	0.12			$	0.07
Net income basic			0.18				0.18				(0.05	)			0.12				0.07
Cash dividends declared			0.00				0.00				0.00				0.00				0.00
Average diluted shares outstanding			33,233,508				33,135,618				33,123,525				26,025,693				25,998,121
Average basic shares outstanding			32,978,006				32,971,444				32,888,612				25,887,591				25,826,825

 

 

CONDENSED CONSOLIDATED BALANCE SHEETS	(Unaudited)
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES

 

		June 30,				December 31,				June 30,
(Dollars in thousands, except share data)		2015				2014				2014
Assets
Cash and due from banks		$	86,904			$	64,411			$	40,175
Interest bearing deposits with other banks			7,844				36,128				113,855
Total  Cash and Cash Equivalents			94,748				100,539				154,030
Securities:
Available for sale (at fair value)			762,086				741,375				518,353
Held for investment (at amortized cost)			214,777				207,904				156,498
Total Securities			976,863				949,279				674,851
Loans available for sale			19,656				12,078				18,129
Loans, net of deferred costs			1,937,399				1,821,885				1,335,192
Less: Allowance for loan losses			(18,791	)			(17,071	)			(18,140	)
Net Loans			1,918,608				1,804,814				1,317,052
Bank premises and equipment, net			50,028				45,086				34,653
Other real estate owned			5,908				7,462				6,198
Other intangible assets			6,824				7,454				326
Goodwill			25,211				25,309				0
Bank owned life insurance			36,291				35,679				0
Other assets			99,451				105,635				88,917
		$	3,233,588			$	3,093,335			$	2,294,156
Liabilities and Shareholders' Equity
Liabilities
Deposits
Noninterest demand		$	808,429			$	725,238			$	509,798
Interest-bearing demand			599,268				652,353				493,927
Savings			282,588				264,738				208,333
Money market			621,973				450,172				335,246
Other time certificates			158,091				173,247				144,001
Brokered time certificates			8,237				7,034				8,040
Time certificates of $100,000 or more			126,591				143,752				106,192
Total Deposits			2,605,177				2,416,534				1,805,537
Federal funds purchased and securities sold under agreements to repurchase, maturing within 30 days			172,676				233,640				141,662
Borrowed funds			50,000				50,000				50,000
Subordinated debt			64,670				64,583				53,610
Other liabilities			14,209				15,927				8,908
			2,906,732				2,780,684				2,059,717
Shareholders' Equity
Common stock			3,300				3,300				2,599
Additional paid in capital			380,553				379,249				302,088
Accumulated deficit			(53,336	)			(65,000	)			(66,478	)
Treasury stock			(64	)			(71	)			(54	)
			330,453				317,478				238,155
Accumulated other comprehensive (loss), net			(3,597	)			(4,827	)			(3,716	)
Total Shareholders' Equity			326,856				312,651				234,439
		$	3,233,588			$	3,093,335			$	2,294,156
Common Shares Outstanding			33,220,511				33,136,592				25,998,823

 

Note: The balance sheet at December 31, 2014 has been derived from the audited financial statements at that date.

 

 

CONSOLIDATED QUARTERLY FINANCIAL  DATA	(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

 

		QUARTERS
		2015								2014
(Dollars in thousands, except per share data)		Second				First				Fourth				Third				Second
Net income (loss)		$	5,805			$	5,859			$	(1,517	)		$	2,996			$	1,918
Operating Ratios
Return on average assets-GAAP basis (2),(3)			0.72	%			0.75	%			(0.20	)%			0.52	%			0.33	%
Return on average tangible assets (2),(3),(4)			0.75				0.79				(0.16	)			0.54				0.36
Return on average shareholders' equity-GAAP basis (2),(3)			7.13				7.42				(1.89	)			4.97				3.25
Efficiency ratio (5)			68.57				68.33				104.46				82.78				89.42
Noninterest income to total revenue			25.63				22.13				22.40				26.30				26.06
Net interest margin (1),(2)			3.50				3.62				3.56				3.17				3.10
Average equity to average assets			10.12				10.17				10.51				10.37				10.27
Credit Analysis Excluding Acquired Loans
Net charge-offs (recoveries) - non-acquired loans		$	(358	)		$	(263	)		$	618			$	(856	)		$	(112	)
Net charge-offs - acquired loans			143				46				-				-				-
Total net charge-offs (recoveries)		$	(215	)		$	(217	)		$	618			$	(856	)		$	(112	)
Net charge-offs (recoveries) to average loans - non-acquired loans			(0.08	)%			(0.06	)%			0.14	%			(0.25	)%			(0.03	)%
Net charge-offs (recoveries) to average loans - acquired loans			0.03				0.01				-				-				-
Toral net charge-offs (recoveries) to average loans			(0.05	)			(0.05	)			0.14				(0.25	)			(0.03	)
Loan loss provision (recapture) - non-acquired loans		$	271			$	292			$	54			$	(1,425	)		$	(1,444	)
Loan loss provision (recapture) - acquired loans			584				141				64				-				-
Total loan loss provision (recapture)		$	855			$	433			$	118			$	(1,425	)		$	(1,444	)
Allowance to loans at end of period - non-acquired loans			1.10	%			1.13	%			1.14	%			1.26	%			1.36	%
Discount for credit losses to acquired loans at end of period			3.32				3.56				3.56				-				-
Nonperforming loans - non-acquired loans		$	15,054			$	16,860			$	18,563			$	18,942			$	21,745
Nonperforming loans - acquired loans			4,543				4,196				2,577				-				-
Other real estate owned - non-acquired			4,855				4,738				5,567				5,018				6,198
Other real estate owned - acquired			1,053				1,431				1,895				-				-
Total nonperforming assets		$	25,505			$	27,225			$	28,602			$	23,960			$	27,943
Restructured loans (accruing)		$	23,441			$	23,847			$	24,997			$	28,969			$	28,157
Purchased noncredit impaired loans		$	275,964			$	296,839			$	326,066			$	-			$	-
Purchased credit impaired loans			6,562				7,119				7,814				-				-
Total acquired loans		$	282,526			$	303,958			$	333,880			$	-			$	-
Nonperforming loans to loans at end of period - non-acquired loans			0.78	%			0.91	%			1.02	%			1.36	%			1.63	%
Nonperforming loans to loans at end of period - acquired loans			0.23				0.23				0.14				-				-
Total nonperforming loans to loans at end of period			1.01				1.14				1.16				1.36				1.63
Nonperforming assets to total assets - non-acquired			0.62	%			0.67	%			0.78	%			1.01	%			1.22	%
Nonperforming assets to total assets - acquired			0.17				0.17				0.14				-				-
Total nonperforming assets to total assets			0.79				0.84				0.92				1.01				1.22
Per Share Common Stock
Net income (loss) diluted-GAAP basis		$	0.18			$	0.18			$	(0.05	)		$	0.12			$	0.07
Net income (loss) basic-GAAP basis			0.18				0.18				(0.05	)			0.12				0.07
Cash dividends declared			0.00				0.00				0.00				0.00				0.00
Book value per share common			9.84				9.71				9.44				9.07				9.02
Average Balances
Total average assets		$	3,225,127			$	3,151,132			$	3,037,061			$	2,305,799			$	2,304,870
Less: Intangible assets			32,188				31,221				33,803				237				422
Total average tangible assets		$	3,192,939			$	3,119,911			$	3,003,258			$	2,305,562			$	2,304,448
Total average equity		$	326,338			$	320,346			$	319,233			$	239,031			$	236,632
Less: Intangible assets			32,188				31,221				33,803				237				422
Total average tangible equity		$	294,150			$	289,125			$	285,430			$	238,794			$	236,210

 

(1)

Calculated on a fully taxable equivalent basis using amortized cost.

(2)

These ratios are stated on an annualized basis and are not necessarily indicative of future periods.

(3)

The calculation of ROA and ROE do not include the mark-to-market unrealized gains (losses), because the unrealized gains (losses) are not included in net income (loss).

(4)

The Company believes that return on average assets and equity excluding the impacts of noncash amortization expense on intangible assets is a better measurement of the Company's trend in earnings growth.

(5)

Defined as (noninterest expense less foreclosed property expense and amortization of intangibles) divided by net operating revenue (net interest income on a fully taxable equivalent basis plus noninterest income excluding securities gains).

 

 

CONSOLIDATED QUARTERLY FINANCIAL  DATA	(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

  

		June 30,				December 31,				June 30,
SECURITIES		2015				2014				2014
U.S. Treasury and U.S. Government Agencies		$	3,843			$	3,899			$	100
Mortgage-backed			558,561				587,933				479,720
Collateralized loan obligations			124,241				125,225				32,260
Obligations of states and political subdivisions			22,873				24,318				6,273
Corporates			24,213				0				0
CMBS			20,587				0				0
Other			7,768				0				0
Securities Available for Sale			762,086				741,375				518,353
Mortgage-backed			173,477				182,076				156,498
Collateralized loan obligations			41,300				25,828				0
Securities Held for Investment			214,777				207,904				156,498
Total Securities		$	976,863			$	949,279			$	674,851

 

		June 30,				December 31,				June 30,
LOANS		2015				2014				2014
Construction and land development		$	95,178			$	87,036			$	57,393
Real estate mortgage			1,588,105				1,524,044				1,145,013
Installment loans to individuals			62,913				52,897				45,241
Commercial and financial			190,325				157,396				87,285
Other loans			878				512				260
Total Loans		$	1,937,399			$	1,821,885			$	1,335,192

 

 

AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES (1)	(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

 

		2015																								2014
		Second Quarter												First Quarter												Second Quarter
		Average								Yield/				Average								Yield/				Average								Yield/
(Dollars in thousands)		Balance				Interest				Rate				Balance				Interest				Rate				Balance				Interest				Rate
Assets
Earning assets:
Securities:
Taxable		$	957,374			$	4,977				2.08	%		$	939,015			$	4,898				2.09	%		$	677,600			$	3,630				2.14	%
Nontaxable			15,311				225				5.87				15,617				230				5.89				827				14				6.77
Total Securities			972,685				5,202				2.14				954,632				5,128				2.15				678,427				3,644				2.15
Federal funds sold and other investments			79,031				249				1.26				92,934				249				1.09				153,410				246				0.64
Loans,  net			1,904,011				22,032				4.64				1,848,965				22,065				4.84				1,338,415				14,151				4.24
Total Earning Assets			2,955,727				27,483				3.73				2,896,531				27,442				3.84				2,170,252				18,041				3.33
Allowance for loan losses			(18,247	)											(17,385	)											(19,784	)
Cash and due from banks			71,858												63,689												35,735
Premises and equipment			49,275												46,605												34,948
Intangible assets			32,188												31,221												422
Bank owned life insurance			36,111												35,793												0
Other assets			98,215												94,678												83,297
		$	3,225,127											$	3,151,132											$	2,304,870
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Interest-bearing demand		$	612,433			$	110				0.07	%		$	628,480			$	117				0.08	%		$	498,285			$	94				0.08	%
Savings			279,354				41				0.06				268,041				39				0.06				205,686				23				0.04
Money market			607,271				373				0.25				519,526				245				0.19				336,772				67				0.08
Time deposits			303,802				321				0.42				318,343				347				0.44				259,325				386				0.60
Federal funds purchased and other short term borrowings			168,068				77				0.18				212,123				98				0.19				150,108				65				0.17
Other borrowings			114,649				773				2.70				114,606				762				2.70				103,610				627				2.43
Total Interest-Bearing Liabilities			2,085,577				1,695				0.33				2,061,119				1,608				0.32				1,553,786				1,262				0.33
Noninterest demand			795,707												753,620												505,892
Other liabilities			17,505												16,047												8,560
Total Liabilities			2,898,789												2,830,786												2,068,238
Shareholders' equity			326,338												320,346												236,632
		$	3,225,127											$	3,151,132											$	2,304,870
Interest expense as a % of earning assets											0.23	%											0.23	%											0.23	%
Net interest income as a % of earning assets						$	25,788				3.50	%						$	25,834				3.62	%						$	16,779				3.10	%

 

(1)

On a fully taxable equivalent basis. All yields and rates have been computed on an annualized basis using amortized cost.

Fees on loans have been included in interest on loans. Nonaccrual loans are included in loan balances.

 

 

CONSOLIDATED QUARTERLY FINANCIAL  DATA	(Unaudited)
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES

 

		2015								2014
(Dollars in thousands)		Second Quarter				First Quarter				Fourth Quarter				Third Quarter				Second Quarter
Customer Relationship Funding (Period End)
Noninterest demand
Commercial		$	561,742			$	546,876			$	481,327			$	301,630			$	293,515
Retail			180,484				191,262				190,120				162,392				167,172
Public funds			47,913				38,529				41,201				39,329				33,223
Other			18,290				16,669				12,590				18,650				15,888
			808,429				793,336				725,238				522,001				509,798
Interest-bearing demand
Commercial			60,411				66,532				58,173				41,131				41,423
Retail			410,601				416,766				407,653				324,690				327,762
Public funds			128,256				151,556				186,527				114,006				124,742
			599,268				634,854				652,353				479,827				493,927
Total transaction accounts
Commercial			622,153				613,408				539,500				342,761				334,938
Retail			591,085				608,028				597,773				487,082				494,934
Public funds			176,169				190,085				227,728				153,335				157,965
Other			18,290				16,669				12,590				18,650				15,888
			1,407,697				1,428,190				1,377,591				1,001,828				1,003,725
Savings			282,588				272,963				264,738				215,076				208,333
Money market
Commercial			191,061				185,668				172,417				118,385				114,662
Retail			272,853				274,203				264,725				218,376				213,927
Public funds			158,059				136,729				13,030				7,965				6,657
			621,973				596,600				450,172				344,726				335,246
Time certificates of deposit			292,919				312,072				324,033				246,920				258,233
Total Deposits		$	2,605,177			$	2,609,825			$	2,416,534			$	1,808,550			$	1,805,537
Customer sweep accounts		$	157,676			$	170,023			$	153,640			$	124,436			$	141,662
Total core customer funding (1)		$	2,469,934			$	2,467,776			$	2,246,141			$	1,686,066			$	1,688,966

 

(1) Total deposits and customer sweep accounts, excluding certificates of deposits.