Attached files
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| 8-K - TIMBERLAND BANCORP, INC. FORM 8-K FOR THE EVENT ON NOVEMBER 2, 2015 - TIMBERLAND BANCORP INC | timb8k11215.htm |
Exhibit 99.1
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| Contact: |
Michael R. Sand,
President & CEO
Dean J. Brydon, CFO
(360) 533-4747
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Timberland Bancorp EPS Increases 46% to $1.17 for Fiscal Year 2015
Operating Revenue Increases, Non-Interest Income Increases and Net Loans Outstanding Increases
Announces $0.07 Regular Dividend and $0.05 Special Dividend
HOQUIAM, WA – November 2, 2015 - Timberland Bancorp, Inc. (NASDAQ: TSBK) (“Timberland” or “the Company”) today reported that solid loan growth and improved asset quality contributed to record fourth quarter profits. The Company recorded net income of $2.96 million and $8.29 million, respectively, for the quarter and fiscal year ended September 30, 2015.
Net income per diluted common share increased 83% to $0.42 for the quarter ended September 30, 2015 from $0.23 for the comparable quarter one year ago and increased 35% from $0.31 for the quarter immediately prior. Earnings per diluted common share for the fiscal year just ended increased 46% to $1.17 from $0.80 for the fiscal year ended September 30, 2014.
Timberland’s Board of Directors declared a $0.07 per common share quarterly cash dividend payable on November 30, 2015 to shareholders of record on November 16, 2015. The Company’s Board of Directors also declared a special one-time dividend of $0.05 per share payable on November 30, 2015 to shareholders of record on November 16, 2015.
“The Company recorded solid core earnings during the September quarter which were increased by approximately $0.14 per share from a loan loss reserve recapture,” stated Michael R. Sand, President and CEO. “A significant reduction in non-performing assets this quarter, combined with a net recovery of $982,000 and the release of a $1.29 million impairment within the loan loss reserve, moved the reserve into an overfunded position. As a result, the Company recorded a loan loss reserve recapture of $1.53 million (approximately $1.0 million after tax) for the quarter. The Company continues to increase operating revenues and net loans outstanding and has increased net income to shareholders annually for five consecutive years. The Company’s assets increased to $816 million which represents the first time its fiscal year-end assets have exceeded $800 million. We are pleased with the year over year improvement in the Company’s already solid financial metrics.”
Fiscal Year 2015 Highlights (at or for the period ended September 30, 2015, compared to September 30, 2014, or June 30, 2015):
-
Earnings per diluted common share for fiscal year 2015 increased 46% to $1.17 from $0.80 for fiscal year 2014;
-
Earnings per diluted common share increased 83% to $0.42 from $0.23 for the comparable quarter one year ago and increased 35% from $0.31 per diluted common share for the quarter ended June 30, 2015;
-
Return on average equity was 13.47% for the current quarter and 9.70% for fiscal year 2015;
-
Return on average assets was 1.47% for the current quarter and 1.07% for fiscal year 2015;
-
Non-performing assets decreased 32% year-over-year and 20% from the prior quarter;
-
Total delinquent loans decreased 47% year-over-year and 33% from the prior quarter;
-
Recorded a net loan loss recovery of $982,000 for the current quarter and $1.02 million for fiscal year 2015;
-
Non-interest income increased 12% year-over-year;
-
Total deposits increased 10% year-over-year and 4% from the prior quarter;
-
Net loans increased 7% year-over-year and 2% from the prior quarter;
-
Tangible book value per common share increased to $11.95 at September 30, 2015 from $10.94 at September 30, 2014.
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 2
Capital Ratios and Asset Quality
Timberland Bancorp remains well capitalized with a total risk-based capital ratio of 15.16%, a Tier 1 leverage capital ratio of 10.64% and a tangible capital to tangible assets ratio of 10.31% at September 30, 2015.
Timberland recorded a $1.53 million loan loss reserve recapture (which added approximately $0.14 to diluted earnings per share) during the quarter ended September 30, 2015 as asset quality continued to improve. During the fourth fiscal quarter the Bank had a $982,000 net recovery on loans previously charged off. The Bank also had a $1.29 million decrease in the portion of the allowance for loan losses allocated to specific impairments due to the resolution of two significant non-accrual loans. The non-performing assets to total assets ratio improved to 1.84% at September 30, 2015 from 2.36% three months earlier and 2.94% one year ago. The allowance for loan losses was 1.61% of loans receivable at September 30, 2015.
Total delinquent loans (past due 30 days or more) and non-accrual loans decreased 33% to $7.2 million at September 30, 2015, from $10.8 million at June 30, 2015 and decreased 47% from $13.7 million one year ago. Non-accrual loans decreased 34% to $6.0 million at September 30, 2015 from $9.1 million at June 30, 2015 and decreased 45% from $10.9 million at September 30, 2014.
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NON-ACCRUAL LOANS
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September 30, 2015
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June 30, 2015
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September 30, 2014
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|||||||||||||||||||||
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($ in thousands)
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Amount
|
Quantity
|
Amount
|
Quantity
|
Amount
|
Quantity
|
||||||||||||||||||
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Mortgage Loans:
|
||||||||||||||||||||||||
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One- to four-family
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$ | 2,368 | 16 | $ | 3,141 | 17 | $ | 4,376 | 21 | |||||||||||||||
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Multi-family
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760 | 1 | 760 | 1 | -- | -- | ||||||||||||||||||
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Commercial
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1,016 | 2 | 462 | 2 | 1,468 | 1 | ||||||||||||||||||
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Construction
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-- | -- | 157 | 1 | -- | -- | ||||||||||||||||||
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Land
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1,558 | 5 | 4,200 | 5 | 4,564 | 8 | ||||||||||||||||||
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Total mortgage loans
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5,702 | 24 | 8,720 | 26 | 10,408 | 30 | ||||||||||||||||||
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Consumer Loans:
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||||||||||||||||||||||||
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Home equity and second
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||||||||||||||||||||||||
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mortgage
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303 | 4 | 374 | 6 | 498 | 6 | ||||||||||||||||||
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Other
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35 | 1 | 36 | 1 | 3 | 1 | ||||||||||||||||||
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Total consumer loans
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338 | 5 | 410 | 7 | 501 | 7 | ||||||||||||||||||
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Total loans
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$ | 6,040 | 29 | $ | 9,130 | 33 | $ | 10,909 | 37 | |||||||||||||||
Other real estate owned (“OREO”) and other repossessed assets decreased 14% to $7.9 million at September 30, 2015, from $9.1 million at September 30, 2014 and decreased 3% from $8.1 million at June 30, 2015. At September 30, 2015, the OREO portfolio consisted of 34 individual properties and one other repossessed asset. During the quarter ended September 30, 2015, three OREO properties totaling $606,000 were sold for a net gain of $1,000.
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OREO and OTHER REPOSSESSED ASSETS
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September 30, 2015
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June 30, 2015
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September 30, 2014
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|||||||||||||||||||||
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($ in thousands)
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Amount
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Quantity
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Amount
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Quantity
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Amount
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Quantity
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||||||||||||||||||
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One- to four-family
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$ | 2,868 | 11 | $ | 2,434 | 8 | $ | 2,904 | 14 | |||||||||||||||
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Multi-family
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-- | -- | -- | -- | 142 | 1 | ||||||||||||||||||
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Commercial
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1,568 | 3 | 2,041 | 4 | 2,209 | 4 | ||||||||||||||||||
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Land
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3,351 | 20 | 3,521 | 21 | 3,837 | 21 | ||||||||||||||||||
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Mobile home
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67 | 1 | 67 | 1 | -- | -- | ||||||||||||||||||
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Total
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$ | 7,854 | 35 | $ | 8,063 | 34 | $ | 9,092 | 40 | |||||||||||||||
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 3
Balance Sheet Management
Total assets increased by $26.0 million, or 3%, to $815.8 million at September 30, 2015, from $789.8 million at June 30, 2015. The increase was primarily due to a $16.1 million increase in cash and cash equivalents and a $9.1 million increase in net loans receivable. The increase in total assets was funded primarily by a $24.2 million increase in total deposits.
Liquidity as measured by cash and cash equivalents, CDs held for investment and available for sale investments securities was 19.6% of total liabilities at September 30, 2015, compared to 17.7% at June 30, 2015, and 16.8% one year ago.
Net loans receivable increased $9.1 million, or 2%, to $607.3 million at September 30, 2015, from $598.2 million at June 30, 2015. The increase was primarily due to an $8.5 million increase in one-to four-family loans, a $1.7 million increase in multi-family loans, a $1.2 million increase in construction and land development loans and a $4.2 million decrease in the undisbursed portion of construction loans in process. These increases to net loans receivable were partially offset by a $2.5 million decrease in commercial business loans, a $2.2 million decrease in commercial mortgage loans, a $1.4 million decrease in land loans and a $925,000 decrease in consumer loans.
LOAN PORTFOLIO
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September 30, 2015
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June 30, 2015
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September 30, 2014
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||||||||||||||||||||||
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($ in thousands)
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Amount
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Percent
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Amount
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Percent
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Amount
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Percent
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||||||||||||||||||
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Mortgage loans:
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||||||||||||||||||||||||
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One- to four-family
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$ | 119,715 | 18 | % | $ | 111,184 | 17 | % | $ | 98,534 | 16 | % | ||||||||||||
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Multi-family
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52,322 | 8 | 50,587 | 8 | 46,206 | 8 | ||||||||||||||||||
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Commercial
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291,216 | 43 | 293,438 | 44 | 294,354 | 48 | ||||||||||||||||||
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Construction and land
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||||||||||||||||||||||||
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development
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110,920 | 16 | 109,678 | 16 | 68,479 | 11 | ||||||||||||||||||
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Land
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26,140 | 4 | 27,495 | 4 | 29,589 | 5 | ||||||||||||||||||
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Total mortgage loans
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600,313 | 89 | 592,382 | 89 | 537,162 | 88 | ||||||||||||||||||
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Consumer loans:
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||||||||||||||||||||||||
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Home equity and second
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||||||||||||||||||||||||
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mortgage
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34,157 | 5 | 35,040 | 5 | 34,921 | 6 | ||||||||||||||||||
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Other
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4,669 | 1 | 4,711 | 1 | 4,699 | 1 | ||||||||||||||||||
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Total consumer loans
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38,826 | 6 | 39,751 | 6 | 39,620 | 7 | ||||||||||||||||||
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Commercial business loans
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33,763 | 5 | 36,288 | 5 | 30,559 | 5 | ||||||||||||||||||
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Total loans
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672,902 | 100 | % | 668,421 | 100 | % | 607,341 | 100 | % | |||||||||||||||
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Less:
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||||||||||||||||||||||||
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Undisbursed portion of
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construction loans in
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process
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(53,457 | ) | (57,674 | ) | (29,416 | ) | ||||||||||||||||||
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Deferred loan origination
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||||||||||||||||||||||||
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fees
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(2,193 | ) | (2,069 | ) | (1,746 | ) | ||||||||||||||||||
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Allowance for loan losses
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(9,924 | ) | (10,467 | ) | (10,427 | ) | ||||||||||||||||||
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Total loans receivable, net
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$ | 607,328 | $ | 598,211 | $ | 565,752 | ||||||||||||||||||
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 4
CONSTRUCTION LOAN COMPOSITION
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September 30, 2015
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June 30, 2015
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September 30, 2014
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($ in thousands)
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Amount
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Percent
of Loan
Portfolio
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Amount
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Percent
of Loan
Portfolio
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Amount
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Percent
of Loan
Portfolio
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||||||||||||||||||
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Custom and owner / builder
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$ | 62,954 | 9 | % | $ | 62,579 | 9 | % | $ | 59,752 | 10 | % | ||||||||||||
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Speculative one- to four-
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||||||||||||||||||||||||
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Family
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6,668 | 1 | 5,205 | 1 | 2,577 | -- | ||||||||||||||||||
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Commercial real estate
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20,728 | 3 | 18,924 | 3 | 3,310 | 1 | ||||||||||||||||||
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Multi-family (including
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||||||||||||||||||||||||
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condominium)
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20,570 | 3 | 22,970 | 3 | 2,840 | -- | ||||||||||||||||||
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Land development
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-- | -- | -- | -- | -- | -- | ||||||||||||||||||
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Total construction loans
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$ | 110,920 | 16 | % | $ | 109,678 | 16 | % | $ | 68,479 | 11 | % | ||||||||||||
Timberland originated $65.97 million in loans during the quarter ended September 30, 2015, compared to $101.3 million for the preceding quarter and $60.4 million for the comparable quarter one year ago. Timberland continues to sell fixed rate one- to four-family mortgage loans into the secondary market for asset–liability management purposes and to generate non-interest income. During the quarter ended September 30, 2015, fixed-rate one- to four-family mortgage loans totaling $16.4 million were sold compared to $16.5 million for the preceding quarter and $10.0 million for the comparable quarter one year ago.
Timberland’s investment securities decreased slightly during the quarter to $9.3 million at September 30, 2015, from $9.4 million at June 30, 2015, primarily due to scheduled amortization.
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DEPOSIT BREAKDOWN
($ in thousands)
|
||||||||||||||||||||||||
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September 30, 2015
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June 30, 2015
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September 30, 2014
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||||||||||||||||||||||
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Amount
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Percent
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Amount
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Percent
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Amount
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Percent
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|||||||||||||||||||
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Non-interest bearing
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$ | 141,388 | 21 | % | $ | 122,133 | 19 | % | $ | 106,417 | 17 | % | ||||||||||||
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N.O.W. checking
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180,628 | 27 | 168,773 | 26 | 160,748 | 26 | ||||||||||||||||||
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Savings
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110,315 | 16 | 104,774 | 16 | 95,665 | 16 | ||||||||||||||||||
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Money market
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84,026 | 12 | 94,529 | 14 | 88,999 | 14 | ||||||||||||||||||
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Money market – brokered
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8,450 | 1 | 8,521 | 1 | -- | -- | ||||||||||||||||||
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Certificates of deposit under $100
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84,824 | 12 | 87,590 | 13 | 95,333 | 16 | ||||||||||||||||||
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Certificates of deposit $100 and over
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66,085 | 10 | 65,202 | 10 | 64,762 | 10 | ||||||||||||||||||
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Certificates of deposit – brokered
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3,196 | 1 | 3,196 | 1 | 3,192 | 1 | ||||||||||||||||||
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Total deposits
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$ | 678,912 | 100 | % | $ | 654,718 | 100 | % | $ | 615,116 | 100 | % | ||||||||||||
Total deposits increased $24.2 million, or 4%, to $678.9 million at September 30, 2015, from $654.7 million at June 30, 2015. The increase was primarily due to a $19.3 million increase in non-interest bearing account balances, an $11.9 million increase in N.O.W. checking account balances and a $5.5 million increase in savings account balances. These increases were partially offset by a $10.6 million decrease in money market account balances and a $1.9 million decrease in certificates of deposit account balances.
Shareholders’ Equity
Total shareholders’ equity increased $1.90 million to $89.19 million at September 30, 2015, from $87.29 million at June 30, 2015. The increase in shareholders’ equity was primarily due to net income of $2.96 million for the quarter, which was partially offset by share repurchases of $709,000 and dividend payments of $494,000 to shareholders. Book value per share increased to $12.76 and tangible book value per share increased to $11.95 at September 30, 2015.
During the quarter, Timberland repurchased 64,788 shares of its common stock for $709,000 (an average price of $10.94 per share). Timberland had 287,893 shares remaining to be purchased on its existing stock repurchase plan at September 30, 2015.
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 5
Operating Results
Operating revenue (net interest income before provision for loan losses, plus non-interest income excluding other than temporary impairment (“OTTI”) charges and gains or losses on sale of investments) increased 2% to $9.70 million for the current quarter from $9.51 million for the preceding quarter and 10% from $8.81 million for the comparable quarter one year ago. For fiscal year 2015, operating revenue increased 7% to $36.77 million from $34.42 million for fiscal year 2014.
Net interest income increased 1% to $7.03 million for the quarter ended September 30, 2015, from $6.98 million for the preceding quarter and increased 7% from $6.59 million for the comparable quarter one year ago. Net interest income was higher during the quarter ended September 30, 2015, primarily due to an increased level of average loans and average interest-earning assets. The net interest margin for the current quarter decreased to 3.76% from 3.88% for the preceding quarter and from 3.86% for the comparable quarter one year ago. The net interest margin for the preceding quarter was higher, in part, due to the collection of $159,000 of non-accrual interest, which increased the net interest margin for the quarter ended June 30, 2015 by approximately nine basis points. For fiscal year 2015, net interest income increased 5% to $27.28 million from $25.92 million for fiscal year 2014. Timberland’s net interest margin for year ended September 30, 2015 decreased to 3.80% from 3.84% for the year ended September 30, 2014.
Non-interest income increased 6% to $2.66 million for the quarter ended September 30, 2015, from $2.52 million in the preceding quarter, and increased 21% from $2.21 million for the comparable quarter one year ago. The increase in non-interest income compared to the preceding quarter was primarily due to an $81,000 increase in service charges on deposits and smaller increases in several other categories. For fiscal year 2015 non-interest income increased 12% to $9.52 million from $8.53 million for fiscal year 2014, primarily due to a $597,000 increase in gain on sale of loans and a $228,000 increase in ATM and debit card interchange transaction fees.
Total operating (non-interest) expenses increased 8% to $6.69 million for the fourth fiscal quarter from $6.22 million for the preceding quarter and increased 5% from $6.37 million for the comparable quarter one year ago. The increased expenses for the current quarter compared to the preceding quarter were primarily due to a $128,000 increase in salaries and employee benefits expense and a $108,000 increase in OREO and other repossessed asset expense. Also impacting the comparison was a non-recurring gain on the sale of excess land during the preceding quarter which reduced total non-interest expenses by $299,000. For fiscal year 2015, total operating expenses were virtually unchanged at $25.84 million compared to $25.80 million for fiscal year 2014.
The provision for income taxes increased $436,000 to $1.56 million for the quarter ended September 30, 2015, from $1.13 million for the preceding quarter, primarily due to increased income before income taxes. The effective tax rate was 34.6% for the current quarter compared to 34.3% for the quarter ended June 30, 2015. For fiscal year 2015, the provision for income taxes increased $1.39 million to $4.19 million from $2.80 million for fiscal year 2014, primarily due to higher income before taxes. The effective tax rate was 33.6% for fiscal year 2015 compared to 32.4% for fiscal year 2014.
About Timberland Bancorp, Inc.
Timberland Bancorp, Inc., a Washington corporation, is the holding company for Timberland Bank (“Bank”). The Bank opened for business in 1915 and serves consumers and businesses across Grays Harbor, Thurston, Pierce, King, Kitsap and Lewis counties, Washington with a full range of lending and deposit services through its 22 branches (including its main office in Hoquiam).
Disclaimer
Certain matters discussed in this press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact and often include the words “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.” Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, assumptions and statements about future performance. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially from the results anticipated, including, but not limited to: the credit risks of lending activities, including changes in the level and trend of loan delinquencies and write-offs and changes in our allowance for loan losses and provision for loan losses that may be impacted by deterioration in the housing and commercial real estate markets and may lead to increased losses and non-performing assets in our loan portfolio, and may result in our allowance for loan losses not being adequate to cover actual losses, and require us to materially increase our loan loss reserves; changes in general economic conditions, either nationally or in our market areas; changes in the levels of general interest rates, and the relative differences between short and long term interest rates, deposit interest rates, our net interest margin and funding sources; fluctuations in the demand for loans, the number of unsold homes, land and other properties and fluctuations in real estate values in our market areas; secondary market conditions for loans and our ability to
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 6
sell loans in the secondary market; results of examinations of us by the Board of Governors of the Federal Reserve System and our bank subsidiary by the Federal Deposit Insurance Corporation, the Washington State Department of Financial Institutions, Division of Banks or other regulatory authorities, including the possibility that any such regulatory authority may, among other things, institute a formal or informal enforcement action or require us to increase our allowance for loan losses, write-down assets, change our regulatory capital position or affect our ability to borrow funds or maintain or increase deposits or impose additional requirements or restrictions, which could adversely affect our liquidity and earnings; legislative or regulatory changes that adversely affect our business including changes in regulatory policies and principles, or the interpretation of regulatory capital or other rules including as a result of Basel III; the impact of the Dodd Frank Wall Street Reform and Consumer Protection Act and the implementation of related rules and regulations; our ability to attract and retain deposits; increases in premiums for deposit insurance; our ability to control operating costs and expenses; the use of estimates in determining fair value of certain of our assets, which estimates may prove to be incorrect and result in significant declines in valuation; difficulties in reducing risk associated with the loans on our consolidated balance sheet; staffing fluctuations in response to product demand or the implementation of corporate strategies that affect our workforce and potential associated charges; computer systems on which we depend could fail or experience a security breach; our ability to retain key members of our senior management team; costs and effects of litigation, including settlements and judgments; our ability to successfully integrate any assets, liabilities, customers, systems, and management personnel we may in the future acquire into our operations and our ability to realize related revenue synergies and cost savings within expected time frames and any goodwill charges related thereto; our ability to manage loan delinquency rates; increased competitive pressures among financial services companies; changes in consumer spending, borrowing and savings habits; the availability of resources to address changes in laws, rules, or regulations or to respond to regulatory actions; our ability to pay dividends on our common and stock; adverse changes in the securities markets; inability of key third-party providers to perform their obligations to us; changes in accounting policies and practices, as may be adopted by the financial institution regulatory agencies or the Financial Accounting Standards Board, including additional guidance and interpretation on accounting issues and details of the implementation of new accounting methods; the economic impact of war or any terrorist activities; other economic, competitive, governmental, regulatory, and technological factors affecting our operations; pricing, products and services; and other risks detailed in our reports filed with the Securities and Exchange Commission.
Any of the forward-looking statements that we make in this press release and in the other public statements we make are based upon management’s beliefs and assumptions at the time they are made. We undertake no obligation to publicly update or revise any forward-looking statements included in this report or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise. We caution readers not to place undue reliance on any forward-looking statements. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements. These risks could cause our actual results for fiscal 2016 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of us, and could negatively affect the Company’s operations and stock price performance.
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 7
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TIMBERLAND BANCORP INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
|
Three Months Ended
|
|||||||||||
|
($ in thousands, except per share amounts)
|
Sept. 30,
|
June 30,
|
Sept. 30,
|
|||||||||
|
(unaudited)
|
2015
|
2015
|
2014
|
|||||||||
|
Interest and dividend income
|
||||||||||||
|
Loans receivable
|
$ | 7,780 | $ | 7,756 | $ | 7,393 | ||||||
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Investment securities
|
70 | 59 | 69 | |||||||||
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Dividends from mutual funds and Federal Home Loan Bank
(“FHLB”) stock
|
10 | 7 | 6 | |||||||||
|
Interest bearing deposits in banks
|
148 | 125 | 98 | |||||||||
|
Total interest and dividend income
|
8,008 | 7,947 | 7,566 | |||||||||
|
Interest expense
|
||||||||||||
|
Deposits
|
508 | 492 | 504 | |||||||||
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FHLB advances
|
475 | 471 | 474 | |||||||||
|
Total interest expense
|
983 | 963 | 978 | |||||||||
|
Net interest income
|
7,025 | 6,984 | 6,588 | |||||||||
|
Recapture of loan losses
|
(1,525 | ) | -- | -- | ||||||||
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Net interest income after recapture of loan losses
|
8,550 | 6,984 | 6,588 | |||||||||
|
Non-interest income
|
||||||||||||
|
OTTI on investment securities, net
|
(8 | ) | (4 | ) | (19 | ) | ||||||
|
Service charges on deposits
|
980 | 899 | 943 | |||||||||
|
Gain on sale of loans, net
|
512 | 514 | 298 | |||||||||
|
Bank owned life insurance (“BOLI”) net earnings
|
137 | 133 | 138 | |||||||||
|
ATM and debit card interchange transaction fees
|
699 | 691 | 658 | |||||||||
|
Other
|
342 | 290 | 189 | |||||||||
|
Total non-interest income, net
|
2,662 | 2,523 | 2,207 | |||||||||
|
Non-interest expense
|
||||||||||||
|
Salaries and employee benefits
|
3,324 | 3,196 | 3,156 | |||||||||
|
Premises and equipment
|
817 | 763 | 777 | |||||||||
|
Gain on disposition of premises and equipment, net
|
-- | (299 | ) | -- | ||||||||
|
Advertising
|
249 | 169 | 206 | |||||||||
|
OREO and other repossessed assets expense, net
|
301 | 193 | 215 | |||||||||
|
ATM and debit card processing
|
292 | 336 | 304 | |||||||||
|
Postage and courier
|
107 | 104 | 117 | |||||||||
|
Amortization of core deposit intangible (“CDI”)
|
-- | -- | 29 | |||||||||
|
State and local taxes
|
135 | 189 | 118 | |||||||||
|
Professional fees
|
223 | 207 | 202 | |||||||||
|
FDIC insurance
|
144 | 142 | 157 | |||||||||
|
Other insurance
|
33 | 28 | 37 | |||||||||
|
Loan administration and foreclosure
|
62 | 88 | 79 | |||||||||
|
Data processing and telecommunications
|
468 | 449 | 392 | |||||||||
|
Deposit operations
|
197 | 220 | 190 | |||||||||
|
Other
|
341 | 435 | 394 | |||||||||
|
Total non-interest expense
|
6,693 | 6,220 | 6,373 | |||||||||
|
(Statement continued on following page)
|
||||||||||||
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 8
|
Three Months Ended
|
||||||||||||
|
Sept. 30,
|
June 30,
|
Sept. 30,
|
||||||||||
| 2015 | 2015 | 2014 | ||||||||||
|
Income before income taxes
|
$ | 4,519 | $ | 3,287 | $ | 2,422 | ||||||
|
Provision for income taxes
|
1,564 | 1,128 | 776 | |||||||||
|
Net income
|
2,955 | 2,159 | 1,646 | |||||||||
|
Preferred stock dividends
|
-- | -- | -- | |||||||||
|
Preferred stock discount accretion
|
-- | -- | -- | |||||||||
|
Net income to common shareholders
|
$ | 2,955 | $ | 2,159 | $ | 1,646 | ||||||
|
Net income per common share:
|
||||||||||||
|
Basic
|
$ | 0.43 | $ | 0.31 | $ | 0.24 | ||||||
|
Diluted
|
0.42 | 0.31 | 0.23 | |||||||||
|
Weighted average common shares outstanding:
|
||||||||||||
|
Basic
|
6,896,941 | 6,902,067 | 6,859,457 | |||||||||
|
Diluted
|
7,069,880 | 7,071,221 | 7,033,090 | |||||||||
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 9
|
TIMBERLAND BANCORP INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
|
Year Ended
|
|||||||
|
($ in thousands, except per share amounts)
|
Sept. 30,
|
Sept. 30,
|
||||||
|
(unaudited)
|
2015
|
2014
|
||||||
|
Interest and dividend income
|
||||||||
|
Loans receivable
|
$ | 30,397 | $ | 29,205 | ||||
|
Investment securities
|
249 | 259 | ||||||
|
Dividends from mutual funds and FHLB stock
|
31 | 27 | ||||||
|
Interest bearing deposits in banks
|
491 | 366 | ||||||
|
Total interest and dividend income
|
31,168 | 29,857 | ||||||
|
Interest expense
|
||||||||
|
Deposits
|
2,004 | 2,066 | ||||||
|
FHLB advances
|
1,886 | 1,873 | ||||||
|
Total interest expense
|
3,890 | 3,939 | ||||||
|
Net interest income
|
27,278 | 25,918 | ||||||
|
Recapture of loan losses
|
(1,525 | ) | -- | |||||
|
Net interest income after recapture of loan losses
|
28,803 | 25,918 | ||||||
|
Non-interest income
|
||||||||
|
Recoveries (OTTI) on investment securities, net
|
(13 | ) | 59 | |||||
|
Gain (loss) on sale of investment securities, net
|
45 | (32 | ) | |||||
|
Service charges on deposits
|
3,615 | 3,738 | ||||||
|
Gain on sale of loans, net
|
1,610 | 1,013 | ||||||
|
BOLI net earnings
|
538 | 530 | ||||||
|
ATM and debit card interchange transaction fees
|
2,664 | 2,426 | ||||||
|
Other
|
1,063 | 796 | ||||||
|
Total non-interest income, net
|
9,522 | 8,530 | ||||||
|
Non-interest expense
|
||||||||
|
Salaries and employee benefits
|
13,200 | 13,294 | ||||||
|
Premises and equipment
|
3,056 | 2,878 | ||||||
|
Gain on disposition of premises and equipment, net
|
(299 | ) | (7 | ) | ||||
|
Advertising
|
779 | 742 | ||||||
|
OREO and other repossessed assets expense, net
|
918 | 1,010 | ||||||
|
ATM and debit card processing
|
1,221 | 1,096 | ||||||
|
Postage and courier
|
429 | 446 | ||||||
|
Amortization of CDI
|
3 | 116 | ||||||
|
State and local taxes
|
561 | 479 | ||||||
|
Professional fees
|
829 | 792 | ||||||
|
FDIC insurance
|
593 | 636 | ||||||
|
Other insurance
|
136 | 150 | ||||||
|
Loan administration and foreclosure
|
269 | 456 | ||||||
|
Data processing and telecommunications
|
1,767 | 1,450 | ||||||
|
Deposit operations
|
812 | 759 | ||||||
|
Other
|
1,567 | 1,501 | ||||||
|
Total non-interest expense
|
25,841 | 25,798 | ||||||
|
(Statement continued on following page)
|
||||||||
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 10
|
Year Ended
|
||||||||
|
Sept. 30,
|
Sept. 30,
|
|||||||
| 2015 | 2014 | |||||||
|
Income before income taxes
|
$ | 12,484 | $ | 8,650 | ||||
|
Provision for income taxes
|
4,192 | 2,800 | ||||||
|
Net income
|
8,292 | 5,850 | ||||||
|
Preferred stock dividends
|
-- | (136 | ) | |||||
|
Preferred stock discount accretion
|
-- | (70 | ) | |||||
|
Net income to common shareholders
|
$ | 8,292 | $ | 5,644 | ||||
|
Net income per common share:
|
||||||||
|
Basic
|
$ | 1.20 | $ | 0.82 | ||||
|
Diluted
|
1.17 | 0.80 | ||||||
|
Weighted average common shares outstanding:
|
||||||||
|
Basic
|
6,897,270 | 6,856,730 | ||||||
|
Diluted
|
7,069,088 | 7,019,676 | ||||||
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 11
|
TIMBERLAND BANCORP INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
|
||||||||||||
|
($ in thousands, except per share amounts) (unaudited)
|
Sept. 30,
|
June 30,
|
Sept. 30,
|
|||||||||
|
2015
|
2015
|
2014
|
||||||||||
|
Assets
|
||||||||||||
|
Cash and due from financial institutions
|
$ | 14,014 | $ | 13,800 | $ | 11,818 | ||||||
|
Interest-bearing deposits in banks
|
78,275 | 62,373 | 60,536 | |||||||||
|
Total cash and cash equivalents
|
92,289 | 76,173 | 72,354 | |||||||||
|
Certificates of deposit (“CDs”) held for investment, at cost
|
48,611 | 47,053 | 35,845 | |||||||||
|
Investment securities:
|
||||||||||||
|
Held to maturity, at amortized cost
|
7,913 | 8,018 | 5,298 | |||||||||
|
Available for sale, at fair value
|
1,392 | 1,401 | 2,857 | |||||||||
|
FHLB stock
|
2,699 | 2,699 | 5,246 | |||||||||
|
Loans receivable
|
614,201 | 604,843 | 575,280 | |||||||||
|
Loans held for sale
|
3,051 | 3,835 | 899 | |||||||||
|
Less: Allowance for loan losses
|
(9,924 | ) | (10,467 | ) | (10,427 | ) | ||||||
|
Net loans receivable
|
607,328 | 598,211 | 565,752 | |||||||||
|
Premises and equipment, net
|
16,854 | 17,083 | 17,679 | |||||||||
|
OREO and other repossessed assets, net
|
7,854 | 8,063 | 9,092 | |||||||||
|
BOLI
|
18,171 | 18,034 | 17,632 | |||||||||
|
Accrued interest receivable
|
2,170 | 2,132 | 1,910 | |||||||||
|
Goodwill
|
5,650 | 5,650 | 5,650 | |||||||||
|
Core deposit intangible
|
-- | -- | 3 | |||||||||
|
Mortgage servicing rights, net
|
1,478 | 1,469 | 1,684 | |||||||||
|
Other assets
|
3,406 | 3,801 | 4,563 | |||||||||
|
Total assets
|
$ | 815,815 | $ | 789,787 | $ | 745,565 | ||||||
|
Liabilities and shareholders’ equity
|
||||||||||||
|
Deposits: Non-interest-bearing demand
|
$ | 141,388 | $ | 122,133 | $ | 106,417 | ||||||
|
Deposits: Interest-bearing
|
537,524 | 532,585 | 508,699 | |||||||||
|
Total deposits
|
678,912 | 654,718 | 615,116 | |||||||||
|
FHLB advances
|
45,000 | 45,000 | 45,000 | |||||||||
|
Other liabilities and accrued expenses
|
2,716 | 2,779 | 2,671 | |||||||||
|
Total liabilities
|
726,628 | 702,497 | 662,787 | |||||||||
|
Shareholders’ equity
|
||||||||||||
|
Common stock, $.01 par value; 50,000,000 shares authorized;
7,047,336 shares issued and outstanding – September 30, 2014
7,053,636 shares issued and outstanding – June 30, 2015
6,988,848 shares issued and outstanding – September 30, 2015
|
10,293 | 10,948 | 10,773 | |||||||||
|
Unearned shares- Employee Stock Ownership Plan
|
(926 | ) | (992 | ) | (1,190 | ) | ||||||
|
Retained earnings
|
80,133 | 77,673 | 73,534 | |||||||||
|
Accumulated other comprehensive loss
|
(313 | ) | (339 | ) | (339 | ) | ||||||
|
Total shareholders’ equity
|
89,187 | 87,290 | 82,778 | |||||||||
|
Total liabilities and shareholders’ equity
|
$ | 815,815 | $ | 789,787 | $ | 745,565 | ||||||
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 12
|
KEY FINANCIAL RATIOS AND DATA
|
Three Months Ended
|
|||||
|
($ in thousands, except per share amounts) (unaudited)
|
Sept. 30,
|
June 30,
|
Sept. 30,
|
|||
|
2015
|
2015
|
2014
|
||||
|
PERFORMANCE RATIOS:
|
||||||
|
Return on average assets (a)
|
1.47%
|
1.11%
|
0.88%
|
|||
|
Return on average equity (a)
|
13.47%
|
10.03%
|
8.04%
|
|||
|
Net interest margin (a)
|
3.76%
|
3.88%
|
3.86%
|
|||
|
Efficiency ratio
|
69.09%
|
65.43%
|
72.46%
|
|||
|
Year Ended
|
||||||
|
Sept. 30,
|
Sept. 30,
|
|||||
|
2015
|
2014
|
|||||
|
PERFORMANCE RATIOS:
|
||||||
|
Return on average asset
|
1.07%
|
0.79%
|
||||
|
Return on average equity
|
9.70%
|
7.08%
|
||||
|
Net interest margin
|
3.80%
|
3.84%
|
||||
|
Efficiency ratio
|
70.22%
|
74.89%
|
||||
|
Sept. 30,
|
June 30,
|
Sept. 30,
|
||||
|
2015
|
2015
|
2014
|
||||
|
ASSET QUALITY RATIOS AND DATA:
|
||||||
|
Non-accrual loans
|
$6,040
|
$9,130
|
$10,909
|
|||
|
Loans past due 90 days and still accruing
|
151
|
488
|
812
|
|||
|
Non-performing investment securities
|
932
|
979
|
1,101
|
|||
|
OREO and other repossessed assets
|
7,854
|
8,063
|
9,092
|
|||
|
Total non-performing assets (b)
|
$14,977
|
$18,660
|
$21,914
|
|||
|
Non-performing assets to total assets (b)
|
1.84%
|
2.36%
|
2.94%
|
|||
|
Net charge-offs (recoveries) during quarter
|
$ (982)
|
$ (85)
|
$ 136
|
|||
|
Allowance for loan losses to non-accrual loans
|
164%
|
115%
|
96%
|
|||
|
Allowance for loan losses to loans receivable (c)
|
1.61%
|
1.72%
|
1.81%
|
|||
|
Troubled debt restructured loans on accrual status (d)
|
$12,484
|
$12,392
|
$16,804
|
|||
|
CAPITAL RATIOS:
|
||||||
|
Tier 1 leverage capital
|
10.64%
|
10.77%
|
10.59%
|
|||
|
Tier 1 risk-based capital
|
13.91%
|
13.76%
|
13.68%
|
|||
|
Total risk-based capital
|
15.16%
|
15.01%
|
14.94%
|
|||
|
Tangible capital to tangible assets (e)
|
10.31%
|
10.41%
|
10.42%
|
|||
|
BOOK VALUES:
|
||||||
|
Book value per common share
|
$ 12.76
|
$ 12.38
|
$ 11.75
|
|||
|
Tangible book value per common share (e)
|
11.95
|
11.57
|
10.94
|
|||
_________________________________________________
(a) Annualized
(b) Non-performing assets include non-accrual loans, loans past due 90 days and still accruing, non-performing investment securities and OREO and other repossessed assets. Troubled debt restructured loans on accrual status are not included.
(c) Includes loans held for sale and is before the allowance for loan losses.
(d) Does not include troubled debt restructured loans totaling $1,233, $1,356 and $2,284 reported as non-accrual loans at September 30, 2015, June 30, 2015 and September 30, 2014, respectively.
(e) Calculation subtracts goodwill and core deposit intangible from the equity component and from assets.
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 13
AVERAGE BALANCES, YIELDS AND RATES - QUARTERLY
($ in thousands)
(unaudited)
|
For the three months ended
|
||||||||||||||||||||||||
|
September 30, 2015
|
June 30, 2015
|
September 30, 2014
|
||||||||||||||||||||||
|
Average
Balance
|
Average
Yield/Rate
|
Average
Balance
|
Average
Yield/Rate
|
Average
Balance
|
Average
Yield/Rate
|
|||||||||||||||||||
|
Assets
|
||||||||||||||||||||||||
|
Loans
|
$ | 612,383 | 5.08 | % | $ | 600,740 | 5.16 | % | $ | 570,995 | 5.18 | % | ||||||||||||
|
Investment securities
|
12,062 | 2.63 | % | 12,276 | 2.15 | % | 13,548 | 2.21 | % | |||||||||||||||
|
Other interest-bearing assets
|
123,129 | 0.48 | % | 107,295 | 0.47 | % | 97,784 | 0.40 | % | |||||||||||||||
|
Total interest-bearing assets
|
747,574 | 4.28 | % | 720,311 | 4.41 | % | 682,327 | 4.44 | % | |||||||||||||||
|
Other assets
|
57,808 | 57,130 | 63,390 | |||||||||||||||||||||
|
Total assets
|
$ | 805,382 | $ | 777,441 | $ | 745,717 | ||||||||||||||||||
|
Liabilities and Shareholders' Equity
|
||||||||||||||||||||||||
|
N.O.W. checking accounts
|
$ | 171,764 | 0.27 | % | $ | 167,003 | 0.27 | % | $ | 158,604 | 0.27 | % | ||||||||||||
|
Money market accounts
|
101,204 | 0.31 | % | 95,341 | 0.30 | % | 93,094 | 0.26 | % | |||||||||||||||
|
Savings accounts
|
107,250 | 0.05 | % | 104,306 | 0.05 | % | 95,013 | 0.05 | % | |||||||||||||||
|
Certificates of deposit accounts
|
154,856 | 0.76 | % | 158,990 | 0.74 | % | 163,465 | 0.79 | % | |||||||||||||||
|
Total interest-bearing deposits
|
535,074 | 0.38 | % | 525,640 | 0.38 | % | 510,176 | 0.39 | % | |||||||||||||||
|
FHLB Advances
|
45,000 | 4.19 | % | 45,000 | 4.20 | % | 45,000 | 4.18 | % | |||||||||||||||
|
Total interest-bearing liabilities
|
580,074 | 0.67 | % | 570,640 | 0.68 | % | 555,176 | 0.70 | % | |||||||||||||||
|
Non-interest-bearing demand deposits
|
133,657 | 117,488 | 105,031 | |||||||||||||||||||||
|
Other liabilities
|
3,883 | 3,220 | 3,627 | |||||||||||||||||||||
|
Shareholders' equity
|
87,768 | 86,093 | 81,883 | |||||||||||||||||||||
|
Total liabilities and shareholders' equity
|
$ | 805,382 | $ | 777,441 | $ | 745,717 | ||||||||||||||||||
|
Net interest income and spread
|
3.61 | % | 3.74 | % | 3.74 | % | ||||||||||||||||||
|
Net interest margin (1)
|
3.76 | % | 3.88 | % | 3.86 | % | ||||||||||||||||||
|
Average interest-bearing assets to
|
||||||||||||||||||||||||
|
average interest-bearing liablilities
|
128.88 | % | 126.23 | % | 122.90 | % | ||||||||||||||||||
(1)Net interest margin = annualized net interest income /
Average interest-bearing assets
Timberland Fiscal Q4 2015 Earnings
November 2, 2015
Page 14
AVERAGE BALANCES, YIELDS AND RATES – YEAR TO DATE
($ in thousands)
(unaudited)
|
Year Ended
|
||||||||||||||||
|
September 30, 2015
|
September 30, 2014
|
|||||||||||||||
|
Average Balance
|
Average Yield/Rate
|
Average Balance
|
Average Yield/Rate
|
|||||||||||||
|
Assets
|
||||||||||||||||
|
Loans
|
$ | 596,750 | 4.98 | % | $ | 567,251 | 5.14 | % | ||||||||
|
Investment securities
|
12,360 | 2.27 | % | 13,114 | 2.19 | % | ||||||||||
|
Other interest-bearing assets
|
108,773 | 0.45 | % | 95,110 | 0.38 | % | ||||||||||
|
Total interest-bearing assets
|
717,883 | 4.34 | % | 675,475 | 4.42 | % | ||||||||||
|
Other assets
|
58,270 | 62,432 | ||||||||||||||
|
Total assets
|
$ | 776,153 | $ | 737,907 | ||||||||||||
|
Liabilities and Shareholders' Equity
|
||||||||||||||||
|
N.O.W. checking accounts
|
$ | 165,895 | 0.27 | % | $ | 156,954 | 0.28 | % | ||||||||
|
Money market accounts
|
94,881 | 0.29 | % | 94,894 | 0.26 | % | ||||||||||
|
Savings accounts
|
102,303 | 0.05 | % | 92,606 | 0.05 | % | ||||||||||
|
Certificates of deposit accounts
|
159,815 | 0.77 | % | 164,014 | 0.81 | % | ||||||||||
|
Total interest-bearing deposits
|
522,894 | 0.39 | % | 508,468 | 0.41 | % | ||||||||||
|
FHLB Advances
|
45,000 | 4.19 | % | 45,000 | 4.16 | % | ||||||||||
|
Total interest-bearing liabilities
|
567,894 | 0.68 | % | 553,468 | 0.71 | % | ||||||||||
|
Non-interest-bearing demand deposits
|
119,599 | 98,454 | ||||||||||||||
|
Other liabilities
|
3,208 | 3,367 | ||||||||||||||
|
Shareholders' equity
|
85,452 | 82,618 | ||||||||||||||
|
Total liabilities and shareholders' equity
|
$ | 776,153 | $ | 737,907 | ||||||||||||
|
Net interest income and spread
|
3.66 | % | 3.71 | % | ||||||||||||
|
Net interest margin (1)
|
3.80 | % | 3.84 | % | ||||||||||||
|
Average interest-bearing assets to
|
||||||||||||||||
|
average interest-bearing liablilities
|
126.41 | % | 122.04 | % | ||||||||||||
________________________________________
(1)Net interest margin = annualized net interest income /
Average interest-bearing assets