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WINSTON-SALEM, N.C., April 28 /PRNewswire-FirstCall/ -- Southern Community Financial Corporation (Nasdaq: SCMF; SCMFO) (the "Company"), the holding company for Southern Community Bank and Trust and The Community Bank, reported record net income of $1,686,000 or $0.10 per diluted share, including one-time merger-related charges, for the first quarter ended March 31, 2004. This compares to net income of $947,000, or $0.10 per diluted share, for the first quarter of 2003.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020823/SCFCLOGO )
Significant milestones achieved during 2004:
* Completed the acquisition of The Community Bank raising assets to over
$1 billion and increasing the number of banking offices to 18;
* Opened a loan production office in Mooresville, North Carolina;
* Redeemed all of the outstanding 7.25% Cumulative Convertible Trust
Preferred Securities (SCMFP) on March 12, 2004;
* Increased common shares outstanding from 8.99 million at year-end 2003
to 17.62 million at the end of the first quarter;
* Reached market capitalization in excess of $200 million;
* Paid an annual cash dividend of $0.11 per share on March 15, 2004.
Net interest income for the first quarter of 2004 rose to record levels as
the net interest margin widened to 3.37%, an increase over the fourth quarter
of 2003 by 32 basis points but contracted in comparison to the year ago
quarter by 11 basis points. Net interest income rose to $8.4 million, a 74.2%
increase over the $4.8 million reported in the same quarter a year ago,
primarily as a result of the infusion of The Community Bank's interest-earning
assets but also due to the continued organic growth of the loan portfolio that
the Company has experienced over the past year.
Non-interest income for the three-month period ended March 31, 2004
increased $359,000, or 30.7%, compared to the same period a year ago,
primarily due to an increase in service charges on deposit accounts although
the growth in non-interest income was tempered by a decline in mortgage
banking revenue. The Community Bank contributed $486,000 to consolidated non-
interest income. The Company recorded non-interest expense of $6.8 million in
the current first quarter, versus the $4.0 million reported in the year ago
period. This increase in operating expenses can be attributed to the
consummation of the acquisition of The Community Bank as well as the opening
of the Mooresville LPO.
As of March 31, 2004, the Company recorded total assets of $1.1 billion,
representing growth of $344.4 million, or 43.1% from the balance recorded at
December 31, 2003 and an increase of $528.8 million, or 86.1% year-over-year.
The increase in total assets for the year were indicative of the $255.8
million increase in the Bank's loan portfolio, net of allowance for loan
losses, as well as an increase in the securities portfolio of $187.5 million.
Total deposits of $801.3 million for the first quarter of 2004 grew $339.3
million, or 73.4%, from the first quarter of 2003, and increased $226.1
million, or 39.3%, on a linked-quarter basis. The Community Bank's net loans
and deposits as of March 31, 2004 totaled $172.0 million and $213.6 million,
respectively.
The Company's allowance for loan losses equaled $12.1 million, or 1.72% of
total loans and 1,071% of non-performing loans at March 31, 2004. In spite of
the extraordinary level of loan growth achieved over the past twelve months,
the Company further improved its credit quality measures as non-performing
loans totaled $1.1 million or 0.16% of total loans at current quarter-end, in
comparison with $3.4 million or 0.77% of total loans as reported in the year
ago quarter. Net charge-offs at 0.14% of average loans for the first quarter
were down 12 basis points in relation to the 0.26% recorded in the quarter
ended March 31, 2003.
Stockholders' equity totaled $131.1 million, up $82.8 million, or 171.4%,
over the balance reported at March 31, 2003. The first quarter 2004 amount
was equivalent to 11.5% of total assets and a book value of $7.44 per share.
The growth in equity is a by-product of the issuance of $63 million of equity
as a portion of the consideration in The Community Bank acquisition as well as
the redemption of $17.3 million of the Company's convertible trust preferred
securities. Regulatory capital ratios remain well in excess of the "well-
capitalized" threshold.
Southern Community Financial Corporation Chairman, President and Chief
Executive Officer F. Scott Bauer commented, "We are extremely pleased with our
first quarter 2004 financial results, and believe that they bode well for the
future. As important, the Company maintained its exceptional record of asset
quality despite the difficult economic environment. The addition of the fine
people and customers at The Community Bank to our team makes us an even
stronger organization. We are also excited that as a result of our merger
with The Community Bank, the declaration and payment of our first cash
dividend and the redemption of our Cumulative Convertible Trust Preferred
Securities, we have added diversity and liquidity to our shareholder base."
Southern Community Financial is the holding company of Southern Community
Bank and Trust and The Community Bank. Southern Community Bank and Trust is a
community bank with eight offices in Winston-Salem, Clemmons, High Point,
Kernersville and Yadkinville, North Carolina. The Community Bank operates ten
banking offices serving markets in Pilot Mountain, Mount Airy, Sandy Ridge,
Madison, Union Grove, Dobson, King, Walnut Cove, and Jonesville, North
Carolina. Southern Community is headquartered in Winston-Salem, North
Carolina.
Southern Community Financial Corporation's common stock and trust
preferred securities are listed on the NASDAQ National Market under the
trading symbols SCMF and SCMFO, respectively. Additional information about
Southern Community is available on its website at www.smallenoughtocare.com or
by email at investor.relations@smallenoughtocare.com.
This news release contains forward-looking statements. Such statements
are subject to certain factors that may cause the Company's results to vary
from those expected. These factors include changing economic and financial
market conditions, competition, ability to execute our business plan, items
already mentioned in this press release, and other factors described in our
filings with the Securities and Exchange Commission. Readers are cautioned
not to place undue reliance on these forward-looking statements, which reflect
management's judgment only as of the date hereof.
Southern Community Financial Corporation
(Amounts in thousands except per share data)
(Unaudited)
For the three months ended
March 31, Dec. 31, Sept. 30, June 30, March 31,
Income Statement 2004 2003 2003 2003 2003
Total Interest Income $12,849 $9,510 $9,338 $8,801 $8,370
Total Interest Expense 4,409 3,945 3,657 3,625 3,524
Net Interest Income 8,440 5,565 5,681 5,176 4,846
Provision for Loan Losses 597 595 465 685 540
Net Interest Income after
Provision for Loan Losses 7,843 4,970 5,216 4,491 4,306
Non-Interest Income
Service Charges on Deposit
Accounts 506 373 399 373 297
Other Income 1,023 761 858 1,051 873
Gain on Sale of Securities - - - - -
Total Non-Interest Income 1,529 1,134 1,257 1,424 1,170
Non-Interest Expense
Salaries and Employee Benefits 3,454 2,541 2,549 2,413 2,100
Occupancy and Equipment 1,027 786 793 776 690
Other 2,270 1,491 1,550 1,415 1,229
Total Non-Interest Expense 6,751 4,818 4,892 4,604 4,019
Income Before Taxes 2,621 1,286 1,581 1,311 1,457
Provision for Income Taxes 935 450 553 459 510
Net Income 1,686 836 1,028 852 947
Net Income per Share
Basic $0.11 $0.09 $0.12 $0.10 $0.11
Diluted $0.10 $0.09 $0.11 $0.09 $0.10
Southern Community Financial Corporation
(Amounts in thousands except per share data)
(Unaudited)
Twelve Months ended
December 31, December 31,
Income Statement 2003 2002
Total Interest Income $36,019 $33,281
Total Interest Expense 14,751 15,803
Net Interest Income 21,268 17,478
Provision for Loan Losses 2,285 1,655
Net Interest Income after Provision
for Loan Losses 18,983 15,823
Non-Interest Income
Service Charges on Deposit Accounts 1,442 1,121
Other Income 3,543 2,737
Gain on Sale of Securities - 69
Total Non-Interest Income 4,985 3,927
Non-Interest Expense
Salaries and Employee Benefits 9,603 7,758
Occupancy and Equipment 3,045 2,508
Other 5,685 4,515
Total Non-Interest Expense 18,333 14,781
Income Before Taxes 5,635 4,969
Provision for Income Taxes 1,972 1,755
Net Income 3,663 3,214
Net Income per Share
Basic $0.41 $0.37
Diluted $0.40 $0.35
Balance Sheet March 31, Dec. 31, Sept. 30, June 30, March 31,
2004 2003 2003 2003 2003
Assets
Cash and due from Banks $19,297 $22,929 $19,571 $18,346 $17,170
Federal Funds Sold 6,014 271 19,436 1,097 605
Investment Securities 314,171 224,424 189,454 205,036 126,643
Other Investments, at
cost 8,300 6,333 7,333 6,833 5,355
Loans 704,237 519,746 496,810 471,145 442,896
Allowance for Loan Losses (12,125) (7,275) (6,948) (6,816) (6,603)
Net Loans 692,112 512,471 489,862 464,329 436,293
Bank Premises and
Equipment 24,730 17,337 18,033 18,041 16,629
Goodwill 50,071 - - - -
Other Assets 28,295 14,737 13,171 12,439 11,363
Total Assets $1,142,990 $798,502 $756,860 $726,121 $614,058
Liabilities and
Stockholders' Equity
Deposits
Non-Interest Bearing 89,327 51,868 50,019 53,357 46,873
Interest Bearing 711,946 523,350 493,863 452,016 415,121
Total Deposits 801,273 575,218 543,882 505,373 461,994
Borrowings 202,867 169,527 158,725 168,230 100,686
Accrued Expenses and
Other Liabilities 7,775 2,866 5,022 3,510 3,089
Total Liabilities 1,011,915 747,611 707,629 677,113 565,769
Total Stockholders'
Equity 131,075 50,891 49,231 49,008 48,289
Total Liabilities and
Stockholders' Equity $1,142,990 $798,502 $756,860 $726,121 $614,058
Book Value per Share $7.44 $5.66 $5.55 $5.57 $5.49
As of or for the three months ended
March 31, Dec. 31, Sept. 30, June 30, March 31,
2004 2003 2003 2003 2003
Per Share Data:
Basic Earnings per Share $0.11 $0.09 $0.12 $0.10 $0.11
Diluted Earnings per Share $0.10 $0.09 $0.11 $0.09 $0.10
Book Value per Share $7.44 $5.66 $5.55 $5.57 $5.49
Cash dividends paid (1) $0.11 - - - -
Selected Performance Ratios:
Return on Average Assets 0.61% 0.43% 0.55% 0.52% 0.64%
Return on Average Equity 5.61% 6.64% 8.25% 7.19% 8.00%
Return on Tangible
Equity (2) 9.50% - - - -
Net Interest Margin 3.37% 3.05% 3.21% 3.38% 3.48%
Net Interest Spread 3.15% 2.85% 3.03% 3.15% 3.21%
Non-interest Income as
a % of Revenue 15.34% 16.91% 18.12% 21.57% 19.45%
Non-interest Income as
a % of Average Assets 0.55% 0.59% 0.67% 0.88% 0.79%
Non-interest Expense to
Average Assets 2.45% 2.48% 2.60% 2.83% 2.71%
Efficiency Ratio 67.72% 71.91% 70.52% 69.75% 66.81%
Asset Quality:
Nonperforming Loans $1,132 $769 $1,201 $1,092 $3,432
Nonperforming Assets $1,685 $1,041 $1,863 $1,766 $3,646
Nonperforming Loans to
Total Loans 0.16% 0.15% 0.24% 0.23% 0.77%
Nonperforming Assets to
Total Assets 0.15% 0.13% 0.25% 0.24% 0.59%
Allowance for Loan Losses
to Period-end Loans 1.72% 1.40% 1.40% 1.45% 1.49%
Allowance for Loan Losses
to Nonperforming
Loans (X) 10.71 9.46 5.79 6.24 1.92
Net Charge-offs to Average
Loans (annualized) 0.14% 0.21% 0.27% 0.41% 0.26%
Capital Ratios:
Equity to Total Assets 11.47% 6.37% 6.50% 6.75% 7.86%
Tangible Equity to Total
Tangible Assets (3) 7.23% - - - -
(1) - Amount is an annual dividend.
(2) - Return on Tangible Equity is annualized net income divided by
average equity of $122 million, less intangibles of $51 million.
(3) - Tangible Equity to Total Tangible Assets is period-ending equity
less intangibles of $52 million, divided by period-ending assets
less intangibles of $52 million.
Management provides the above non-GAAP measures, footnotes (2) and (3), to
provide management and readers with the impact of purchase accounting on
key financial ratios.
As of or for the twelve months ended
December 31, December 31,
2003 2002
Per Share Data:
Basic Earnings per Share $0.41 $0.37
Diluted Earnings per Share $0.40 $0.35
Book Value per Share $5.66 $5.41
Cash dividends paid (1) - -
Selected Performance Ratios:
Return on Average Assets 0.53% 0.58%
Return on Average Equity 7.48% 7.24%
Return on Tangible Equity (2) - -
Net Interest Margin 3.25% 3.34%
Net Interest Spread 3.03% 3.02%
Non-interest Income as a % of Revenue 18.99% 18.35%
Non-interest Income as a % of Average Assets 0.72% 0.71%
Non-interest Expense to Average Assets 2.63% 2.66%
Efficiency Ratio 69.83% 69.05%
Asset Quality:
Nonperforming Loans $769 $1,823
Nonperforming Assets $1,041 $2,206
Nonperforming Loans to Total Loans 0.15% 0.43%
Nonperforming Assets to Total Assets 0.13% 0.36%
Allowance for Loan Losses to
Period-end Loans 1.40% 1.50%
Allowance for Loan Losses to
Nonperforming Loans (X) 9.46 3.48
Net Charge-offs to Average Loans
(annualized) 0.29% 0.18%
Capital Ratios:
Equity to Total Assets 6.37% 7.76%
Tangible Equity to Total Tangible
Assets (3) - -
(1) - Amount is an annual dividend.
(2) - Return on Tangible Equity is annualized net income divided by
average equity of $122 million, less intangibles of $51 million.
(3) - Tangible Equity to Total Tangible Assets is period-ending equity
less intangibles of $52 million, divided by period-ending assets
less intangibles of $52 million.
Management provides the above non-GAAP measures, footnotes (2) and (3), to
provide management and readers with the impact of purchase accounting on
key financial ratios.
SOURCE Southern Community Financial Corporation
-0- 04/28/2004
/CONTACT: F. Scott Bauer, Chairman and CEO of Southern Community Financial
Corporation, +1-336-768-8500/
/Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20020823/SCFCLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, photodesk@prnewswire.com /
/Web site: http://www.smallenoughtocare.com /
(SCMF SCMFO)
CO: Southern Community Financial Corporation; Southern Community Bank and
Trust; Community Bank
ST: North Carolina
IN: FIN
SU: ERN DIV
KM-JK
-- CLW068 --
1219 04/28/200415:34 EDThttp://www.prnewswire.com