GAINESVILLE, Ga., July 20, 2004 (PRIMEZONE) -- GB&T Bancshares, Inc. (Nasdaq:GBTB), a fast-growing multi-bank holding company comprised of five Georgia community banks, reported second quarter 2004 net income of $2.2 million, or $0.26 per diluted share, compared with $1.7 million, or $0.25 per diluted share, for the prior-year second quarter. Earnings reflect strong revenue growth from a combination of internal growth and acquisitions; the Company surpassed $1 billion in assets this quarter, reflecting a 32 percent increase above last year's second quarter. The quarterly per share comparison reflects a 24.8 percent increase in average diluted shares outstanding to 8,700,000 as a result of the 1,397,584 shares issued for the acquisition of First National Bank of the South ($127 million in assets), which closed August 29, 2003, and the impact of a 5-for-4 stock split in the form of a stock dividend effective June 18, 2004.
For the first six months of 2004, GB&T Bancshares reported net income of $4.5 million, or $0.52 per diluted share, compared to $3.4 million, or $0.50 per diluted share, for the prior-year period. The year-to-date per share comparison reflects a 25.0 percent increase in average diluted shares outstanding issued for the acquisition of First National Bank of the South and the stock split mentioned above.
At a meeting held July 19, 2004, the Board of Directors of GB&T Bancshares declared a third quarter cash dividend of $0.076 per share on the Company's common stock. The $0.076 dividend is unchanged from the first quarter cash dividend of $0.095 when adjusted for the 5-for-4 stock split effective June 18, 2004, and is a 5.6% increase over the dividend announced for the prior-year third quarter. The declared dividend is payable on August 10, 2004 to shareholders of record as of the close of business on July 29, 2004.
The annualized returns on average assets ("ROA") and average equity ("ROE") for the second quarter of 2004 were 0.91 percent and 9.05 percent, respectively, compared with 0.92 percent and 11.08 percent for the second quarter of 2003. For the first six months of 2004, ROA and ROE were 0.92 percent and 9.09 percent, respectively, compared with 0.93 percent and 11.18 percent for the prior-year period.
Richard A. Hunt, President and CEO, commented, "We achieved an important milestone this quarter when we surpassed the $1 billion mark in total assets. We believe our ability to maintain strong profit growth and excellent asset quality while we expand our Company at a rapid pace validates the success of the high-growth acquisition strategy we launched in 1998. We are pleased with our progress and see further opportunities, both organically and through acquisitions, for continued earnings momentum. Our markets are among the fastest-growing in the country, and we plan to participate in that growth. Customers continue to be attracted by our real-estate expertise combined with responsive service and the latest technology.
"Our pending acquisitions of $118 million asset Southern Heritage Bancorp, located in south Hall County and $72 million asset Lumpkin County Bank in neighboring Lumpkin County will further solidify our foothold in high-growth markets, as well as provide opportunities to enhance our efficiency as we grow. We anticipate both of these acquisitions will close during the third quarter.
"We continue to receive recognition for our strong performance. For the fifth consecutive year, GB&T Bancshares ranked among the top 100 of Georgia's top performing companies in the Atlanta Journal-Constitution's 11th annual Best-of-Business Section -- better known as the Georgia 100. For the second consecutive year, GB&T Bancshares has been included in the Russell 3000 index of the 3,000 largest publicly-traded companies based on market capitalization."
Total revenue, defined as net interest income and non-interest income, was $12.1 million for the second quarter of 2004, an increase of 23.8 percent over the $9.7 million reported in the prior-year period. Net interest income rose 24.1 percent to $9.1 million, reflecting a 29.3 percent increase in average earning assets above the prior-year quarter, partially offset by a 16 basis point decline in the net interest margin over the same period, to 4.08 percent. Mr. Hunt noted, "While low interest rates have placed downward pressure on our net interest margin in recent quarters, we are encouraged by the recent increase in the federal funds rate, and we believe we are positioned for improvement in our net interest margin in the rising rate environment."
Non-interest income for the second quarter of 2004 was $2.9 million, an increase of 23.0 percent over the prior-year period. Excluding gains on the sale of securities, non-interest income increased 10.8 percent. The majority of the increase was derived from growth in our charges on deposit accounts, up 25.8 percent, and improvement in other operating income, up 54.2 percent. Growth in both of these categories reflects the First National Bank of the South acquisition plus organic growth. Excluding gains on sale of securities, non-interest income represents 22.2 percent of operating revenue.
Non-interest expense for the second quarter of 2004 was $8.5 million, an increase of 16.2 percent above the second quarter of 2003. Excluding the one-time loss of $0.2 million on the sale of real property, non-interest expense increased 19.5 percent. Salaries and employee benefits, the largest component of expense growth, increased 18.4 percent, reflecting a 16.4 percent increase in full-time equivalent staff from the acquisition of First National Bank of the South, as well as merit and benefits increases. GB&T Bancshares' efficiency ratio was 72.4 percent for the second quarter of 2004 compared to 72.0 percent for the prior-year period.
Asset quality is strong and shows improving trends. Mr. Hunt commented, "We are pleased to report a decline in the absolute and relative levels of nonperforming assets over the last twelve months, despite 31.9 percent growth in our loan portfolio during the same period." Nonperforming assets at June 30, 2004, were 0.50 percent of assets compared with 0.67 percent twelve months ago. Annualized net charge-offs for the second quarter of 2004 were 0.19 percent of average loans compared with 0.06 percent for the second quarter of 2003. The ratio of loan loss reserves was 1.21 percent of total loans.
Total assets were $1.0 billion at June 30, 2004, an increase of $242.5 million, or 32.0 percent from twelve months ago. The First National Bank of the South acquisition accounted for $127 million, or 52.4 percent, of the increase, while $115 million of the asset growth, or 47.6 percent, was organic. Loans rose $180.4 million, or 31.9 percent, to $745.4 million. Total deposits increased $173.3 million, or 28.6 percent, to $778.4 million.
Shareholders' equity at June 30, 2004 was $99.4 million, a twelve-month increase of $36.1 million, or 57.0 percent, reflecting the impact of the First National Bank of the South acquisition. Shareholders' equity was 9.94 percent of period-end assets. GB&T Bancshares had 8,592,874 shares of common stock outstanding at quarter-end.
About GB&T Bancshares, Inc.
Based in Gainesville, Georgia, GB&T Bancshares, Inc. is a multi-bank holding company operating five community banks: Gainesville Bank & Trust, United Bank & Trust, Community Trust Bank, HomeTown Bank of Villa Rica, and First National Bank of the South. In addition, the Company owns a consumer finance company, Community Loan Company, with eight offices located in Northern Georgia. As of June 30, 2004, GB&T Bancshares had assets of $1.0 billion, with 20 branches located in high-growth Georgia markets. GB&T Bancshares' common stock is listed on the Nasdaq National Market under the symbol "GBTB." Please visit our website www.gbt.com for additional information about the company.
Forward-Looking Statements
Some of the statements in this press release, including, without limitation, statements regarding our proposed acquisitions, projected growth in the counties in which we operate, our efficiency, loan loss reserves, net interest margin, revenue growth and other statements regarding our future results of operations are "forward-looking statements" within the meaning of the federal securities laws. In addition, when we use words like "anticipate", "believe", "intend", "expect", "estimate", "could", "should", "will", and similar expressions, you should consider them as identifying forward-looking statements, although we may use other phrasing. These forward-looking statements involve risks and uncertainties and are based on our current beliefs and assumptions. Factors that may cause actual results to differ materially from those expressed or implied by such forward-looking statements include, among others, the following possibilities: (1) competitive pressures among depository and other financial institutions may increase significantly; (2) changes in the interest rate environment may reduce margins or the volumes or values of loans held or made by us; (3) general economic conditions may be less favorable than expected (both generally and in our markets), resulting in, among other things, a deterioration in credit quality and/or a reduction in demand for credit; (4) economic, governmental or other factors may prevent the projected population and commercial growth in the counties in which we operate; (5) we may be unable to obtain required shareholder or regulatory approval for our proposed acquisitions, (6) legislative or regulatory changes, including changes in accounting standards, may adversely affect the businesses in which we are engaged; (7) costs or difficulties related to the integration of our businesses may be greater than expected; (8) deposit attrition, customer loss or revenue loss following the acquisitions may be greater than expected; (9) competitors may have greater financial resources and develop products that enable such competitors to compete more successfully than us; and (10) adverse changes may occur in the equity markets. Many of these factors are beyond our ability to control or predict, and readers are cautioned not to put undue reliance on such forward-looking statements. We disclaim any obligation to update or revise any forward-looking statements contained in this release.
GB&T has filed registration statements on Form S-4 and other documents with the Securities and Exchange Commission (the "SEC") in connection with the acquisitions of Southern Heritage Bancorp, Inc. and Lumpkin County Bank. One registration statement contains a prospectus of GB&T relating to the common stock to be issued in the acquisition of Southern Heritage Bancorp and a proxy statement of Southern Heritage Bancorp relating to the acquisition, while the other registration statement contains a prospectus of GB&T relating to the common stock to be issued in the acquisition of Lumpkin County Bank and a proxy statement of Lumpkin County Bank relating to the acquisition. Investors and shareholders are urged to read the respective proxy statements/prospectuses and any other relevant documents filed with the SEC because they contain important information. Investors and shareholders will be able to receive the respective proxy statements/prospectuses and other documents filed by GB&T free of charge at the SEC's web site, www.sec.gov or from GB&T Bancshares, Inc. at 500 Jesse Jewell Parkway, S.E., Gainesville, Georgia 30501.
GB&T and its directors and executive officers and Southern Heritage Bancorp and its directors and executive officers will be participants in the solicitation of proxies in connection with the acquisition of Southern Heritage. In addition, GB&T and its directors and executive officers and Lumpkin County Bank and its directors and executive officers will be participants in the solicitation of proxies in connection with the acquisition of Lumpkin County Bank. Information about the directors and executive officers of GB&T and their ownership of GB&T stock will be set forth in the respective proxy statements/prospectuses. Investors may obtain additional information regarding the interests of such participants by reading the respective proxy statements/prospectuses.
GB&T Bancshares Inc.
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited)
(Dollars in thousands except per share amounts)
--------------------------------------------------------------------
2nd Qtr 1st Qtr 4th Qtr 3rd Qtr 2nd Qtr
2004 2004 2003 2003 2003
------------------- ---------- ------- ------- ------- -------
EARNINGS
Net interest income $ 9,110 8,886 9,301 7,865 7,341
Provision for loan
loss $ 325 284 155 861 176
Other income $ 2,942 2,899 2,660 2,524 2,392
Other expense $ 8,475 8,348 8,282 7,319 7,291
Net income $ 2,233 2,230 2,803 1,478 1,733
Non-recurring
expense (loss on
sale of building)
after-tax $ 0 0 0 0 196
Operating income $ 2,233 2,230 2,803 1,478 1,929
PER SHARE DATA
Basic earnings per
share $ 0.26 0.26 0.33 0.20 0.26
Diluted earnings
per share $ 0.26 0.26 0.32 0.19 0.25
Operating diluted
earnings per
share $ 0.26 0.26 0.32 0.19 0.28
Book value per
share $ 11.57 11.65 11.40 11.21 9.40
Tangible book
value per share $ 7.75 7.79 7.51 7.67 7.99
Cash dividend per
share $ 0.076 0.072 0.072 0.072 0.072
PERFORMANCE RATIOS
Return on average
assets 0.91% 0.93% 1.18% 0.72% 0.92%
Return on average
equity 9.05% 9.14% 11.62% 7.94% 11.08%
Net interest
margin 4.08% 4.11% 4.32% 4.18% 4.24%
Other expense/
Average assets 3.44% 3.49% 3.47% 3.58% 3.89%
Efficiency Ratio 72.40% 72.45% 70.58% 70.98% 72.03%
Other income/Total
operating revenue 22.18% 22.88% 20.73% 23.72% 24.19%
MARKET DATA
Market value per
share - Period
end $ 23.90 22.52 18.90 17.81 19.66
Market as a % of
book 2.07 1.93 1.66 1.59 2.09
Cash dividend
yield 1.27% 1.28% 1.52% 1.62% 1.47%
Common stock
dividend payout
ratio 29.23% 28.13% 22.50% 37.50% 29.03%
Period-end common
shares outstanding
(000) 8,593 8,528 8,493 8,490 6,739
Common stock market
capitalization
($ Millions) $ 205.37 192.04 160.55 151.20 132.45
CAPITAL & LIQUIDITY
Equity to assets 9.94% 10.20% 10.26% 10.35% 8.35%
Period-end tangible
equity to assets 6.88% 7.06% 7.00% 7.33% 7.19%
Total risk-based
capital ratio 11.66% 11.78% 11.80% 12.34% 12.84%
Average loans to
deposits 95.54% 97.39% 95.63% 96.00% 94.25%
ASSET QUALITY
Net charge-offs $ 342 6 508 157 87
(Ann.) Net loan
charge-offs/
Average loans 0.19% 0.003% 0.29% 0.10% 0.06%
Non-performing
loans $ 2,511 2,951 3,333 4,849 3,332
OREOs $ 1,368 2,053 1,868 1,279 1,171
90-day past dues $ 1,096 1,053 509 750 597
NPAs + 90 day past
due/Total assets 0.50% 0.62% 0.60% 0.75% 0.67%
Allowance for loan
losses/Total loans 1.21% 1.24% 1.23% 1.33% 1.33%
Allowance for loan
losses/NPAs
+ 90 days past due 180.64% 148.65% 152.82% 132.00% 147.59%
END OF PERIOD
BALANCES
Total loans, net of
unearned fees $ 745,437 724,282 709,958 685,098 565,055
Total assets $1,000,519 974,213 944,278 919,228 758,048
Deposits $ 778,364 758,178 728,629 712,289 605,063
Stockholders'
equity $ 99,431 99,327 96,843 95,172 63,325
Full-time
equivalent
employees 384 388 380 365 330
AVERAGE BALANCES
Loans $ 738,092 720,063 700,662 611,294 564,210
Total earning
assets $ 898,197 869,253 854,205 747,089 694,728
Total assets $ 990,519 960,962 945,785 811,516 751,953
Deposits $ 772,587 739,353 732,672 636,735 598,642
Stockholders'
equity $ 99,254 98,137 95,701 73,868 62,739
GB&T Bancshares, Inc.
Condensed Consolidated Statement of Condition
6/30/2004 6/30/2003
Assets (in thousands): (Unaudited) (Unaudited)
Cash and due from banks $ 19,090 $ 17,092
Interest-bearing deposits in banks 961 4,778
Federal funds sold 9,631 15,607
----------- -----------
Total cash and equivalents 29,682 37,477
----------- -----------
Securities available-for-sale,
at fair value 146,429 115,988
Restricted equity securities 5,388 3,531
----------- -----------
Total securities 151,817 119,519
----------- -----------
Loans 745,437 565,055
Allowance for loan losses 8,987 7,527
----------- -----------
Loans, net 736,450 557,528
----------- -----------
Premises and equipment 26,454 20,576
Goodwill and intangible assets 32,825 9,493
Other assets 23,291 13,455
----------- -----------
Total assets $ 1,000,519 $ 758,048
=========== ===========
Liabilities and Stockholders'
Equity (in thousands):
Deposits
Non interest-bearing $ 94,548 $ 66,894
Interest-bearing 683,816 538,169
----------- -----------
Total deposits 778,364 605,063
----------- -----------
Federal funds purchased and securities
sold under repurchase agreements 17,259 11,451
Federal Home Loan Bank advances 77,458 57,585
Other borrowings 2,234 822
Other liabilities 10,309 4,802
Company guaranteed trust preferred
securities 15,464 15,000
----------- -----------
Total liabilities 901,088 694,723
----------- -----------
Stockholders' equity:
Capital stock 68,825 35,976
Retained earnings 31,594 25,635
Accumulated other comprehensive
income (loss) (988) 1,714
----------- -----------
Total stockholders' equity 99,431 63,325
----------- -----------
Total liabilities and
stockholders' equity $ 1,000,519 $ 758,048
=========== ===========
GB&T BANCSHARES, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(Unaudited)
Three months ended Six months ended
June 30, June 30,
2004 2003 2004 2003
---------------------------------------------
(amounts in thousands, except per share data)
Interest income:
Loans, including fees $11,903 $ 9,967 $23,548 $19,705
Investment securities:
Taxable 1,040 950 2,025 1,935
Nontaxable 186 158 370 326
Federal funds sold 33 52 60 106
Interest-bearing deposits
in banks 7 6 8 17
------- ------- ------- -------
Total interest income 13,169 11,133 26,011 22,089
------- ------- ------- -------
Interest expense:
Deposits 3,005 2,899 5,908 5,876
Federal funds purchased
and securities sold under
repurchase agreements 45 42 93 83
Federal Home Loan Bank
advances 801 637 1,601 1,365
Other borrowings 208 214 413 427
------- ------- ------- -------
Total interest expense 4,059 3,792 8,015 7,751
------- ------- ------- -------
Net interest income 9,110 7,341 17,996 14,338
Provision for loan losses 325 176 609 390
------- ------- ------- -------
Net interest income after
Provision for loan losses 8,785 7,165 17,387 13,948
------- ------- ------- -------
Other income:
Service charges on
deposit accounts 1,487 1,182 2,881 2,274
Mortgage origination fees 511 726 971 1,283
Insurance commissions 157 149 301 293
Gain on sale of securities 346 49 609 77
Other operating income 441 286 1,079 817
------- ------- ------- -------
Total other income 2,942 2,392 5,841 4,744
------- ------- ------- -------
Other expense:
Salaries and employee
benefits 4,940 4,171 9,873 8,295
Net occupancy and
equipment expense 1,204 1,030 2,426 2,034
Other operating expenses 2,331 2,090 4,524 3,763
------- ------- ------- -------
Total other expense 8,475 7,291 16,823 14,092
------- ------- ------- -------
Income before income
taxes 3,252 2,266 6,405 4,600
Income tax expense 1,019 533 1,942 1,156
------- ------- ------- -------
Net income $ 2,233 $ 1,733 $ 4,463 $ 3,444
======= ======= ======= =======
Earnings per share:
Basic $ 0.26 $ 0.26 $ 0.52 $ 0.51
======= ======= ======= =======
Diluted $ 0.26 $ 0.25 $ 0.52 $ 0.50
======= ======= ======= =======
Weighted average shares
Basic 8,556 6,728 8,533 6,714
======= ======= ======= =======
Diluted 8,700 6,973 8,667 6,934
======= ======= ======= =======
Cash dividends per common
share $ 0.076 $ 0.072 $ 0.148 $ 0.140
======= ======= ======= =======