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First Us Bancshares Inc (FUSB) SEC Filing 8-K Material Event for the period ending Monday, May 4, 2020

First Us Bancshares Inc

CIK: 717806 Ticker: FUSB

Exhibit 99.1

 

 

 

Contact:

Thomas S. Elley

 

205-582-1200

 

 

FIRST US BANCSHARES, INC.

ANNOUNCES FIRST QUARTER 2020 RESULTS

 

BIRMINGHAM, AL (May 4, 2020) – First US Bancshares, Inc. (Nasdaq: FUSB) (the “Company”), the parent company of First US Bank (the “Bank”), today reported net income of $0.8 million, or $0.13 per diluted share, for the quarter ended March 31, 2020, compared to $1.2 million, or $0.18 per diluted share, for both of the quarters ended December 31, 2019 and March 31, 2019.

 

“Our management team and employees are very focused right now on serving our customers during the global pandemic,” stated James F. House, President and CEO of the Company. “I am proud of their tireless efforts.  Due to the resiliency of our people, as well as the strength and stability of our balance sheet, I believe that we are well positioned to handle the challenges that we see ahead,” continued Mr. House.

 

First Quarter 2020 Highlights

 

Transfer of Indirect Loans – Effective January 1, 2020, the Company transferred a total of $45.5 million of its indirect loan portfolio from the Bank’s wholly-owned subsidiary, Acceptance Loan Company (“ALC”), to the Bank. The loans transferred include indirect sales lending relationships originated through prominent national or regional retailers that are managed by the Company on a centralized basis. The Company currently operates this lending in 11 states located in the southeastern United States. Management believes that the movement of this portfolio under the Bank’s brand will afford greater opportunity for growth and diversification of the portfolio over time.    

 

Net Interest Margin – Net interest margin was 4.97% for the first quarter of 2020, compared to 5.12% for the fourth quarter of 2019 and 5.17% for the first quarter of 2019. The reduction in net interest margin during the first quarter of 2020 resulted from the prevailing interest rate environment during the quarter, including the 150-basis point reduction in the federal funds rate in March that had an immediate impact on interest earned on the Company’s interest-bearing cash holdings. In response to the changing environment, during the quarter, management reduced rates paid on the majority of its deposit products. These efforts reduced total costs on interest-bearing liabilities during the quarter; however, interest-bearing assets repriced faster than interest-bearing liabilities. Should the interest rate environment hold in the near term, the Company expects to further reduce interest costs as interest-bearing liabilities continue to reprice.  

 

Asset Quality – Non-performing assets, including loans in non-accrual status and other real estate owned (OREO), were $4.7 million as of March 31, 2020 and $4.8 million as of December 31, 2019. As a percentage of total assets, non-performing assets totaled 0.60% as of March 31, 2020, compared to 0.61% as of December 31, 2019.  

 

Loan Loss Reserves and Provisioning The provision for loan and lease losses was $0.6 million during the first quarter of 2020, compared to $0.7 million during the fourth quarter of 2019 and $0.4 million during the first quarter of 2019.  Due to changing economic conditions as a result of the COVID-19 pandemic, the Company increased qualitative factors associated with macroeconomic conditions in its calculation of the allowance for loan and lease losses as of March 31, 2020.  The allowance as a percentage of total loans was 1.09% as of March 31, 2020, compared to 1.05% as of December 31, 2019 and 0.97% as of March 31, 2019.  Excluding acquired loans, which continue to be recorded net of  purchase discounts that management believes are adequate to absorb losses inherent in the portfolio, the allowance as a percentage of total loans was 1.31% as of March 31, 2020, compared to 1.29% as of December 31, 2019 and 1.34% as of March 31, 2019. Due to its classification as a smaller reporting company, the Company was not required to and did not adopt the Current Expected Credit Loss (CECL) model during the first quarter of 2020. Management believes that the allowance for loan and lease losses as of March 31, 2020, which was calculated under an incurred loss model, was sufficient to absorb losses in the Company’s loan portfolio based on circumstances existing as of the balance sheet date. However, the economic environment as a result of the COVID-19 pandemic continues to contain a significant level of uncertainty, and accordingly, management will continue to closely monitor the impact of changing economic circumstances on the Company’s loan portfolio.

 

Non-interest Income – Non-interest income totaled $1.3 million during the first quarter of 2020, compared to $1.4 million during the fourth quarter of 2019 and $1.3 million during the first quarter of 2019.

 

Non-interest Expense – Non-interest expense totaled $8.5 million during the first quarter of 2020, compared to $8.3 million during the fourth quarter of 2019 and $8.5 million during the first quarter of 2019.

 


 

First US Bancshares, Inc. Reports First Quarter 2020 Results

Page 2

May 4, 2020

 

 

 

Provision for Income Taxes – The Company recorded $0.3 million in income tax expense for the first quarter of 2020, compared to $0.4 million in both the fourth quarter of 2019 and the first quarter of 2019. For the quarter ended March 31, 2020, the Company’s effective tax rate was 23.6%, compared to 24.0% for the quarter ended December 31, 2019 and 22.1% for the quarter ended March 31, 2019.

 

Cash Dividend The Company declared a cash dividend of $0.03 per share on its common stock in the first quarter of 2020, which is consistent with the Company’s quarterly dividend declaration for the fourth quarter of 2019. These quarters represented an increase over the Company’s quarterly dividend declarations of $0.02 in the first three quarters of 2019 and each quarter of 2018.

 

Share Repurchases During the first quarter of 2020, the Company completed share repurchases totaling 38,604 shares of its $0.01 par value common stock at a weighted average price of $11.70 per share.  The shares were repurchased under the Company’s existing share repurchase program, which was originally approved by the Company’s Board of Directors in 2006. As of March 31, 2020, a total of 54,961 shares remained available for repurchase under the program.

 

Regulatory Capital – During the first quarter of 2020, the Bank continued to maintain capital ratios at higher levels than the ratios required to be considered a “well-capitalized” institution under applicable banking regulations. As of March 31, 2020, the Bank’s common equity Tier 1 capital and Tier 1 risk-based capital ratios were each 12.79%. Its total capital ratio was 13.81%, and its Tier 1 leverage ratio was 9.46%.

 

Liquidity – As of March 31, 2020, the Company continued to maintain excess funding capacity sufficient to provide adequate liquidity for loan growth, capital expenditures and ongoing operations. The Company benefits from a strong core deposit base, a liquid investment securities portfolio, and access to funding from a variety of sources, including federal funds lines, Federal Home Loan Bank advances and brokered deposits.

 

Impact of COVID-19 Pandemic and CARES Act

 

As a result of the COVID-19 pandemic, in March 2020, management implemented the Company’s Pandemic Contingency Plan (the “Plan”). The Plan includes activities designed to promote the safety and well-being of employees and customers, and to monitor the Company’s financial and business risks as a result of the pandemic.  The procedures implemented under the Plan include, but are not limited to:

 

 

Daily briefings with management and stakeholders to stay current on developments;

 

Increased monitoring and communications with loan and deposit customers;

 

Increased monitoring of the Company’s capital and liquidity positions;

 

Increased cleaning and sanitation of our facilities;

 

Additional communication to ensure that our robust suite of digital offerings are understood by customers;

 

Suspension of non-essential travel for our employees;

 

Implementation of social distancing protocols, including drive-thru only bank branch operations, and limitation of in-person meetings; and

 

Increased risk monitoring to ensure prudence in all of our management actions.

 

In accordance with the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”), which was signed into law on March 27, 2020, the Company has implemented initiatives to provide opportunities to borrowers for short-term payment deferments.  In addition, subsequent to March 31, 2020, the Company has participated in funding loans under the Paycheck Protection Program administered by the Small Business Administration.

 

 

About First US Bancshares, Inc.

 

First US Bancshares, Inc. is a bank holding company that operates banking offices in Alabama, Tennessee and Virginia through First US Bank. In addition, the Company’s operations include Acceptance Loan Company, Inc., a consumer loan company, and FUSB Reinsurance, Inc., an underwriter of credit life and credit accident and health insurance policies sold to the Bank’s and ALC’s consumer loan customers. The Company files periodic reports with the U.S. Securities and Exchange Commission (the “SEC”). Copies of its filings may be obtained through the SEC’s website at www.sec.gov or at www.firstusbank.com. More information about the Company and the Bank may be obtained at www.firstusbank.com. The Company’s stock is traded on the Nasdaq Capital Market under the symbol “FUSB.”

 



First US Bancshares, Inc. Reports First Quarter 2020 Results

Page 3

May 4, 2020

 

 

 

Forward-Looking Statements

 

This press release contains forward-looking statements, as defined by federal securities laws. Statements contained in this press release that are not historical facts are forward-looking statements. These statements may address issues that involve significant risks, uncertainties, estimates and assumptions made by management. The Company undertakes no obligation to update these statements following the date of this press release, except as required by law. In addition, the Company, through its senior management, may make from time to time forward-looking public statements concerning the matters described herein. Such forward-looking statements are necessarily estimates reflecting the best judgment of the Company’s senior management based upon current information and involve a number of risks and uncertainties. Certain factors that could affect the accuracy of such forward-looking statements are identified in the public filings made by the Company with the SEC, and forward-looking statements contained in this press release or in other public statements of the Company or its senior management should be considered in light of those factors. Specifically, with respect to statements relating to the sufficiency of the allowance for loan and lease losses, loan demand, cash flows, growth and earnings potential, expansion and the Company’s positioning to handle the challenges presented by the novel coronavirus (COVID-19), these factors include, but are not limited to, the rate of growth (or lack thereof) in the economy generally and in the Bank’s and ALC’s service areas; market conditions and investment returns; changes in interest rates; the impact of the current COVID-19 pandemic on our business, our customers, the communities that we serve and the United States economy, including the impact of actions taken by governmental authorities to try to contain the virus or address the impact of the virus on the United States economy (including, without limitation, the CARES Act) and the resulting effect on our operations, liquidity and capital position and on the financial condition of our borrowers and other customers; the pending discontinuation of LIBOR as an interest rate benchmark; the availability of quality loans in the Bank’s and ALC’s service areas; the relative strength and weakness in the consumer and commercial credit sectors and in the real estate markets; collateral values; and cybersecurity threats. There can be no assurance that such factors or other factors will not affect the accuracy of such forward-looking statements.


 

First US Bancshares, Inc. Reports First Quarter 2020 Results

Page 4

May 4, 2020

 

 

FIRST US BANCSHARES, INC. AND SUBSIDIARIES

SELECTED FINANCIAL DATA – LINKED QUARTERS

(Dollars in Thousands, Except Per Share Data)

(Unaudited)

 

 

 

Quarter Ended

 

 

 

2020

 

 

2019

 

 

 

March

31,

 

 

December

31,

 

 

September

30,

 

 

June

30,

 

 

March

31,

 

Results of Operations:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

10,397

 

 

$

10,825

 

 

$

11,027

 

 

$

10,923

 

 

$

10,813

 

Interest expense

 

 

1,511

 

 

 

1,636

 

 

 

1,680

 

 

 

1,690

 

 

 

1,640

 

Net interest income

 

 

8,886

 

 

 

9,189

 

 

 

9,347

 

 

 

9,233

 

 

 

9,173

 

Provision for loan and lease losses

 

 

580

 

 

 

716

 

 

 

883

 

 

 

715

 

 

 

400

 

Net interest income after provision for loan

   and lease losses

 

 

8,306

 

 

 

8,473

 

 

 

8,464

 

 

 

8,518

 

 

 

8,773

 

Non-interest income

 

 

1,297

 

 

 

1,396

 

 

 

1,414

 

 

 

1,291

 

 

 

1,265

 

Non-interest expense

 

 

8,494

 

 

 

8,279

 

 

 

8,546

 

 

 

8,504

 

 

 

8,453

 

Income before income taxes

 

 

1,109

 

 

 

1,590

 

 

 

1,332

 

 

 

1,305

 

 

 

1,585

 

Provision for income taxes

 

 

262

 

 

 

381

 

 

 

214

 

 

 

300

 

 

 

351

 

Net income

 

$

847

 

 

$

1,209

 

 

$

1,118

 

 

$

1,005

 

 

$

1,234

 

Per Share Data:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income per share

 

$

0.13

 

 

$

0.19

 

 

$

0.17

 

 

$

0.16

 

 

$

0.19

 

Diluted net income per share

 

$

0.13

 

 

$

0.18

 

 

$

0.16

 

 

$

0.15

 

 

$

0.18

 

Dividends declared

 

$

0.03

 

 

$

0.03

 

 

$

0.02

 

 

$

0.02

 

 

$

0.02

 

Key Measures (Period End):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

$

788,565

 

 

$

788,738

 

 

$

771,930

 

 

$

777,171

 

 

$

795,334

 

Tangible assets (1)

 

 

779,850

 

 

 

779,913

 

 

 

762,996

 

 

 

768,115

 

 

 

786,150

 

Loans, net of allowance for loan losses

 

 

539,685

 

 

 

545,243

 

 

 

544,519

 

 

 

511,515

 

 

 

502,760

 

Allowance for loan and lease losses

 

 

5,954

 

 

 

5,762

 

 

 

5,585

 

 

 

5,087

 

 

 

4,924

 

Investment securities, net

 

 

110,079

 

 

 

108,356

 

 

 

114,309

 

 

 

136,649

 

 

 

148,025

 

Total deposits

 

 

682,595

 

 

 

683,662

 

 

 

677,640

 

 

 

682,806

 

 

 

703,361

 

Short-term borrowings

 

 

10,152

 

 

 

10,025

 

 

 

221

 

 

 

73

 

 

 

 

Total shareholders’ equity

 

 

84,332

 

 

 

84,748

 

 

 

83,790

 

 

 

83,748

 

 

 

81,573

 

Tangible common equity (1)

 

 

75,617

 

 

 

75,923

 

 

 

74,856

 

 

 

74,692

 

 

 

72,389

 

Book value per common share

 

 

13.73

 

 

 

13.76

 

 

 

13.47

 

 

 

13.28

 

 

 

12.94

 

Tangible book value per common share (1)

 

 

12.31

 

 

 

12.33

 

 

 

12.03

 

 

 

11.84

 

 

 

11.48

 

Key Ratios:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets (annualized)

 

 

0.43

%

 

 

0.61

%

 

 

0.57

%

 

 

0.51

%

 

 

0.63

%

Return on average common equity

   (annualized)

 

 

4.02

%

 

 

5.68

%

 

 

5.28

%

 

 

4.89

%

 

 

6.21

%

Return on average tangible common equity

   (annualized) (1)

 

 

4.49

%

 

 

6.35

%

 

 

5.92

%

 

 

5.50

%

 

 

7.01

%

Net interest margin

 

 

4.97

%

 

 

5.12

%

 

 

5.23

%

 

 

5.21

%

 

 

5.17

%

Efficiency ratio (2)

 

 

83.4

%

 

 

78.2

%

 

 

79.4

%

 

 

80.8

%

 

 

81.0

%

Net loans to deposits

 

 

79.1

%

 

 

79.8

%

 

 

80.4

%

 

 

74.9

%

 

 

71.5

%

Net loans to assets

 

 

68.4

%

 

 

69.1

%

 

 

70.5

%

 

 

65.8

%

 

 

63.2

%

Tangible common equity to tangible

   assets (1)

 

 

9.70

%

 

 

9.73

%

 

 

9.81

%

 

 

9.72

%

 

 

9.21

%

Tier 1 leverage ratio (3)

 

 

9.46

%

 

 

9.61

%

 

 

9.55

%

 

 

9.43

%

 

 

9.22

%

Allowance for loan losses as % of loans

 

 

1.09

%

 

 

1.05

%

 

 

1.02

%

 

 

0.98

%

 

 

0.97

%

Nonperforming assets as % of total assets

 

 

0.60

%

 

 

0.61

%

 

 

0.35

%

 

 

0.35

%

 

 

0.39

%

 

(1)   Refer to Non-GAAP Financial Measures – Tangible Balances and Measures beginning on page 10

(2)   Efficiency ratio = non-interest expense / (net interest income + non-interest income)

(3)   First US Bank Tier 1 leverage ratio


 

First US Bancshares, Inc. Reports First Quarter 2020 Results

Page 5

May 4, 2020

 

 

 

FIRST US BANCSHARES, INC. AND SUBSIDIARIES

NET INTEREST MARGIN

THREE MONTHS ENDED MARCH 31, 2020 AND 2019

(Dollars in Thousands)

(Unaudited)

 

 

 

Three Months Ended

 

 

Three Months Ended

 

 

 

March 31, 2020

 

 

March 31, 2019

 

 

 

Average

Balance

 

 

Interest

 

 

Annualized

Yield/

Rate %

 

 

Average

Balance

 

 

Interest

 

 

Annualized

Yield/

Rate %

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Loans

 

$

548,107

 

 

$

9,639

 

 

 

7.07

%

 

$

512,047

 

 

$

9,673

 

 

 

7.66

%

Taxable investment securities

 

 

104,123

 

 

 

531

 

 

 

2.05

%

 

 

148,333

 

 

 

794

 

 

 

2.17

%

Tax-exempt investment securities

 

 

1,191

 

 

 

10

 

 

 

3.38

%

 

 

2,201

 

 

 

15

 

 

 

2.76

%

Federal Home Loan Bank stock

 

 

1,137

 

 

 

14

 

 

 

4.95

%

 

 

703

 

 

 

11

 

 

 

6.35

%

Federal funds sold

 

 

12,663

 

 

 

42

 

 

 

1.33

%

 

 

7,134

 

 

 

44

 

 

 

2.50

%

Interest-bearing deposits in banks

 

 

52,026

 

 

 

161

 

 

 

1.24

%

 

 

48,535

 

 

 

276

 

 

 

2.31

%

Total interest-earning assets

 

 

719,247

 

 

 

10,397

 

 

 

5.81

%

 

 

718,953

 

 

 

10,813

 

 

 

6.10

%

Non-interest-earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other assets

 

 

73,405

 

 

 

 

 

 

 

 

 

 

 

69,871

 

 

 

 

 

 

 

 

 

Total

 

$

792,652

 

 

 

 

 

 

 

 

 

 

$

788,824

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

$

169,424

 

 

$

175

 

 

 

0.42

%

 

$

169,268

 

 

$

206

 

 

 

0.49

%

Savings deposits

 

 

165,419

 

 

 

313

 

 

 

0.76

%

 

 

168,925

 

 

 

461

 

 

 

1.11

%

Time deposits

 

 

238,234

 

 

 

987

 

 

 

1.67

%

 

 

254,610

 

 

 

973

 

 

 

1.55

%

Total interest-bearing deposits

 

 

573,077

 

 

 

1,475

 

 

 

1.04

%

 

 

592,803

 

 

 

1,640

 

 

 

1.12

%

Borrowings

 

 

10,121

 

 

 

36

 

 

 

1.43

%

 

 

349

 

 

 

 

 

 

 

Total interest-bearing liabilities

 

 

583,198

 

 

 

1,511

 

 

 

1.04

%

 

 

593,152

 

 

 

1,640

 

 

 

1.12

%

Non-interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Demand deposits

 

 

114,239

 

 

 

 

 

 

 

 

 

 

 

107,045

 

 

 

 

 

 

 

 

 

Other liabilities

 

 

10,494

 

 

 

 

 

 

 

 

 

 

 

8,027

 

 

 

 

 

 

 

 

 

Shareholders’ equity

 

 

84,721

 

 

 

 

 

 

 

 

 

 

 

80,600

 

 

 

 

 

 

 

 

 

Total

 

$

792,652

 

 

 

 

 

 

 

 

 

 

$

788,824

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

 

 

 

$

8,886

 

 

 

 

 

 

 

 

 

 

$

9,173

 

 

 

 

 

Net interest margin

 

 

 

 

 

 

 

 

 

 

4.97

%

 

 

 

 

 

 

 

 

 

 

5.17

%

 


 

First US Bancshares, Inc. Reports First Quarter 2020 Results

Page 6

May 4, 2020

 

 

 

FIRST US BANCSHARES, INC. AND SUBSIDIARIES

INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in Thousands, Except Per Share Data)

 

 

 

March 31,

 

 

December 31,

 

 

 

2020

 

 

2019

 

 

 

(Unaudited)

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

Cash and due from banks

 

$

13,219

 

 

$

11,939

 

Interest-bearing deposits in banks

 

 

42,902

 

 

 

45,091

 

Total cash and cash equivalents

 

 

56,121

 

 

 

57,030

 

Federal funds sold

 

 

15,080

 

 

 

10,080

 

Investment securities available-for-sale, at fair value

 

 

96,541

 

 

 

94,016

 

Investment securities held-to-maturity, at amortized cost

 

 

13,538

 

 

 

14,340

 

Federal Home Loan Bank stock, at cost

 

 

1,135

 

 

 

1,137

 

Loans and leases, net of allowance for loan and lease losses of $5,954 and

   $5,762, respectively

 

 

539,685

 

 

 

545,243

 

Premises and equipment, net

 

 

29,071

 

 

 

29,216

 

Cash surrender value of bank-owned life insurance

 

 

15,622

 

 

 

15,546

 

Accrued interest receivable

 

 

2,391

 

 

 

2,488

 

Goodwill and core deposit intangible, net

 

 

8,715

 

 

 

8,825

 

Other real estate owned

 

 

1,054

 

 

 

1,078

 

Other assets

 

 

9,612

 

 

 

9,739

 

Total assets

 

$

788,565

 

 

$

788,738

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

 

 

Non-interest-bearing

 

$

116,190

 

 

$

112,729

 

Interest-bearing

 

 

566,405

 

 

 

570,933

 

Total deposits

 

 

682,595

 

 

 

683,662

 

Accrued interest expense

 

 

487

 

 

 

537

 

Other liabilities

 

 

10,999

 

 

 

9,766

 

Short-term borrowings

 

 

10,152

 

 

 

10,025

 

Total liabilities

 

 

704,233

 

 

 

703,990

 

 

 

 

 

 

 

 

 

 

Shareholders’ equity:

 

 

 

 

 

 

 

 

Common stock, par value $0.01 per share, 10,000,000 shares authorized;

   7,592,251 and 7,568,053 shares issued, respectively; 6,143,286 and 6,157,692

   shares outstanding, respectively

 

 

75

 

 

 

75

 

Surplus

 

 

13,904

 

 

 

13,814

 

Accumulated other comprehensive loss, net of tax

 

 

(763

)

 

 

(46

)

Retained earnings

 

 

93,418

 

 

 

92,755

 

Less treasury stock: 1,448,965 and 1,410,361 shares at cost, respectively

 

 

(22,302

)

 

 

(21,850

)

Total shareholders’ equity

 

 

84,332

 

 

 

84,748

 

 

 

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

$

788,565

 

 

$

788,738

 

 


 

First US Bancshares, Inc. Reports First Quarter 2020 Results

Page 7

May 4, 2020

 

 

 

FIRST US BANCSHARES, INC. AND SUBSIDIARIES

INTERIM CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in Thousands, Except Per Share Data)

(Unaudited)

 

 

 

Three Months Ended

 

 

 

March 31,

 

 

 

2020

 

 

2019

 

Interest income:

 

 

 

 

 

 

 

 

Interest and fees on loans

 

$

9,639

 

 

$

9,673

 

Interest on investment securities

 

 

758

 

 

 

1,140

 

Total interest income

 

 

10,397

 

 

 

10,813

 

 

 

 

 

 

 

 

 

 

Interest expense:

 

 

 

 

 

 

 

 

Interest on deposits

 

 

1,475

 

 

 

1,640

 

Interest on borrowings

 

 

36

 

 

 

 

Total interest expense

 

 

1,511

 

 

 

1,640

 

 

 

 

 

 

 

 

 

 

Net interest income

 

 

8,886

 

 

 

9,173

 

 

 

 

 

 

 

 

 

 

Provision for loan and lease losses

 

 

580

 

 

 

400

 

 

 

 

 

 

 

 

 

 

Net interest income after provision for loan and lease losses

 

 

8,306

 

 

 

8,773

 

 

 

 

 

 

 

 

 

 

Non-interest income:

 

 

 

 

 

 

 

 

Service and other charges on deposit accounts

 

 

434

 

 

 

460

 

Credit insurance income

 

 

153

 

 

 

143

 

Net gain on sales and prepayments of investment securities

 

 

 

 

 

13

 

Mortgage fees from secondary market

 

 

127

 

 

 

103

 

Lease income

 

 

212

 

 

 

209

 

Other income, net

 

 

371

 

 

 

337

 

Total non-interest income

 

 

1,297

 

 

 

1,265

 

 

 

 

 

 

 

 

 

 

Non-interest expense:

 

 

 

 

 

 

 

 

Salaries and employee benefits

 

 

5,136

 

 

 

4,988

 

Net occupancy and equipment

 

 

1,001

 

 

 

1,089

 

Computer services

 

 

417

 

 

 

351

 

Fees for professional services

 

 

278

 

 

 

242

 

Other expense

 

 

1,662

 

 

 

1,783

 

Total non-interest expense

 

 

8,494

 

 

 

8,453

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

 

1,109

 

 

 

1,585

 

Provision for income taxes

 

 

262

 

 

 

351

 

Net income

 

$

847

 

 

$

1,234

 

Basic net income per share

 

$

0.13

 

 

$

0.19

 

Diluted net income per share

 

$

0.13

 

 

$

0.18

 

Dividends per share

 

$

0.03

 

 

$

0.02

 

 


 

First US Bancshares, Inc. Reports First Quarter 2020 Results

Page 8

May 4, 2020

 

 

 

Non-GAAP Financial Measures

 

In addition to the financial results presented in this press release that have been prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company’s management believes that certain non-GAAP financial measures and ratios are beneficial to the reader. These non-GAAP measures have been provided to enhance overall understanding of the Company’s current financial performance and position. Management believes that these presentations provide meaningful comparisons of financial performance and position in various periods and can be used as a supplement to the GAAP-based measures presented in this press release. The non-GAAP financial results presented should not be considered a substitute for the GAAP-based results. Management believes that both GAAP measures of the Company’s financial performance and the respective non-GAAP measures should be considered together.

 

The non-GAAP measures and ratios that have been provided in this press release include measures of operating income, tangible assets and equity, and certain ratios that include tangible assets and equity. Discussion of these measures and ratios is included below, along with reconciliations of each relevant non-GAAP measure to GAAP-based measures included in the financial statements previously presented in the press release.

 

Operating Income

 

In addition to GAAP-based measures of net income, management periodically reviews certain non-GAAP measures of pre-tax income that factor out the impact of discrete income or expense items that, although not unusual, infrequent or nonrecurring, tend to fluctuate significantly from quarter to quarter or are based on events that are not necessarily indicative of the Company’s core operating earnings as a financial institution. An example includes the provision for loan and lease losses which, although a core part of the Company’s operating activities, may fluctuate significantly based on the level of loan growth in a quarter, changes in economic factors or other events during the quarter. Examples of items that are not necessarily considered by management to be core to the Company’s operating earnings include accretion and amortization of discounts, premiums and intangible assets associated with purchase accounting. In its own analysis, management has defined operating income as a non-GAAP financial measure that adjusts net income for the following items:

 

 

Provision for (benefit from) income taxes