POPLAR BLUFF, Mo.--(BUSINESS WIRE)--July 28, 2006--
Southern Missouri Bancorp, Inc. ("Company") (NASDAQ:
SMBC), the parent corporation of Southern Missouri Bank and Trust Co.
("Bank"), today announced net income for the fourth quarter of fiscal
2006 of $779,000, or $.35 per diluted share, an increase from the loss
of $587,000, or $(.26) per diluted share, during the same period of
the prior year. The increase in diluted earnings per share was due
primarily to the inclusion in the prior period's results of a $2.0
million provision for loan losses, compared to a $270,000 provision in
the current period, and was partially offset by the difference between
an income tax benefit of $383,000 during the prior period and a
$303,000 provision for income taxes in the current period. For fiscal
2006, the bank's net income increased to $2.8 million, or $1.24 per
diluted share, an increase from $104,000, or $.05 per diluted share,
earned in fiscal 2005. The increase in diluted earnings per share for
the fiscal year was also primarily due to loan loss provisions of $4.8
million in the prior year, compared to $555,000 in the current year,
offset again by the difference between an $82,000 income tax benefit
in the prior year, compared to a provision for income taxes of $1.4
million in the current year.
The fourth quarter and the fiscal year's results were negatively
impacted by the Company's opening of a branch in Sikeston, Missouri,
in January of 2006. We estimate that the after-tax impact of operating
the branch during the fourth quarter decreased diluted earnings per
share by $.02. For the fiscal year, we estimate that the after-tax
impact of operating the branch decreased diluted earnings per share by
$.05.
Dividend Declared
The Board of Directors and management believe the continuation of
a quarterly dividend enhances shareholder value and demonstrates our
commitment to and confidence in our future prospects. Therefore, they
are pleased to announce the 49th consecutive quarterly dividend since
the inception of the Company. The $.09 cash dividend will be paid on
August 31, 2006, to shareholders of record at the close of business on
August 15, 2006.
Balance Sheet Summary
The Company experienced balance sheet growth, with assets
increasing $20.3 million, or 6.2%, to $350.7 million at June 30, 2006,
as compared to $330.4 million at June 30, 2005. Growth in assets was
primarily reflected in increases in the loan portfolio, the investment
portfolio, and cash balances. Asset growth has been funded primarily
with deposits.
Loans, net of allowance for loan losses, as of June 30, 2006,
increased $13.4 million, or 5.0%, to $280.9 million, as compared to
$267.6 million at June 30, 2005. The increase in the loan portfolio
primarily reflects growth in the balances of commercial real estate
and commercial loans of $7.2 million and $5.8 million, respectively.
Asset quality remains relatively strong with annualized net loan
charge-offs for the year totaling .25% of average net loans, compared
to 1.85% for fiscal 2005. Non-performing loans totaled $53,000 at June
30, 2006. Our allowance for loan loss at June 30, 2006, totaled $2.1
million, representing .73% of net loans and 3,889% of non-performing
loans.
The investment portfolio increased $3.7 million, or 10.7%, to
$38.4 million at June 30, 2006, as compared to $34.7 million at June
30, 2005, primarily due to a $5.8 million increase in the amount
invested in U.S. government and federal agency obligations, partially
offset by a $2.8 million decrease in the amounts invested in
mortgage-backed securities.
Total liabilities increased $18.8 million, or 6.2%, to $324.1
million, at June 30, 2006, as compared to $305.4 million at June 30,
2005. Deposits increased $33.4 million, or 14.9%, to $258.1 million at
June 30, 2006, as compared to $224.7 million at June 30, 2005. The
increase in deposits was primarily due to a $25.7 million increase in
certificates of deposit (which resulted from promotional term/rate
certificates, including the net purchase of $10.7 million in brokered
deposits), an $8.1 million increase in money market passbook accounts,
and a $6.0 million increase in checking accounts, partially offset by
a $5.7 million decrease in money market deposit accounts. FHLB
advances decreased $15.5 million, or 25.2%, to $46.0 million at June
30, 2006, as compared to $61.5 million at June 30, 2005, due primarily
to our strategic decision to increase certificate of deposit balances
and repay overnight borrowings in a rising rate environment.
The Company's stockholders' equity increased $1.6 million, or
6.2%, to $26.6 million at June 30, 2006, from $25.0 million at June
30, 2005. The increase was primarily due to net income, partially
offset by cash dividends paid and a decrease in market value of the
investment portfolio.
The Company has previously announced the intention to repurchase
up to 115,000 shares of its common stock, or approximately 5% of its
outstanding common shares. To date, the Company has repurchased 89,000
shares at an average cost of $15.17 per share. The Company has not
been actively purchasing shares of its common stock at this time, but
market conditions, business opportunities, and other economic
conditions may alter our outlook on repurchasing common stock.
Income Statement Summary
The Company's net interest income increased for the three and
twelve month periods ended June 30, 2006, by $250,000, or 11.0%, and
$348,000, or 3.8%, respectively, as compared to the same periods of
the prior year. The increase was primarily due to an increase in the
amount of interest-earning assets, partially offset by decreases in
net interest rate spread. The net interest rate spread for the three
and twelve month periods ended June 30, 2006, was 2.77% and 2.69%,
respectively, compared to 2.78% and 2.84%, respectively, for the same
periods of the prior year. The decrease in net interest rate spread
for the three month period ended June 30, 2006, resulted from a 70
basis point increase in the weighted-average cost of funds, partially
offset by a 69 basis point increase in the weighted-average yield on
interest-earning assets. The decrease in net interest rate spread for
the twelve month period ended June 30, 2006, resulted from a 71 basis
point increase in the weighted-average cost of funds, partially offset
by a 56 basis point increase in the weighted-average yield on
interest-earning assets. Net interest rate spread compression during
the fiscal year has been due primarily to short-term interest rate
increases by the Federal Reserve, without similar long-term interest
rate increases, increased competition within our market area for both
loans and deposits, and increased average cash balances, which lowered
our average yield on interest-earning assets.
Non-interest income increased $29,000, or 5.5%, for the three
month period ended June 30, 2006, as compared to the same period of
the prior year. For the twelve month period ended June 30, 2006,
non-interest income decreased $170,000, or 7.4%, as compared to the
prior year, primarily due to the inclusion in the results for fiscal
2005 of gains realized on the sale of equities and investments
totaling $352,000.
Non-interest expense decreased $82,000, or 4.5%, for the three
month period ended June 30, 2006, as compared to the same period of
the prior year. The decrease was primarily due to lower legal and
professional fees, offset by higher occupancy expenses. For the twelve
month period ended June 30, 2006, non-interest expense increased
$300,000, or 4.5%, as compared to the prior year, primarily due to
higher compensation and occupancy expenses, partially offset by lower
legal and professional fees. For the three and twelve month periods
ended June 30, 2006, the operation of the Sikeston facility
contributed $113,000 and $254,000, respectively, to non-interest
expense. Absent those expenses, non-interest expense would have
decreased by $195,000, or 11.2%, for the three month period, and
increased $46,000, or 0.7%, for the twelve month period.
The efficiency ratio for the three month period ended June 30,
2006, improved to 56.2%, compared to 64.7% for the same period of the
prior year. The improvement was due to the aforementioned decrease in
non-interest expense, coupled with increases in net interest income
and non-interest income, compared to the same period of the prior
year. For the twelve month period ended June 30, 2006, the efficiency
ratio narrowed to 59.8%, compared to 58.2% for fiscal 2005. The
narrowing was due primarily to the inclusion in the prior year's
results of the aforementioned $352,000 in gains on the sale of
equities and investments. Absent non-interest expense incurred due to
the opening and operation of the new Sikeston facility, we estimate
that the Company's efficiency ratio would have been 54.5% for the
fourth quarter, and 58.4% for the fiscal year. The Company continues
to evaluate opportunities to improve efficiency.
Except for the historical information contained herein, the
matters discussed in this press release may be deemed to be
forward-looking statements that involve risks and uncertainties,
including changes in economic conditions in the Company's market area,
changes in policies by regulatory agencies, fluctuations in interest
rates, demand for loans in the Company's market area, and competition.
Actual strategies and results in future periods may differ materially
from those currently expected. These forward-looking statements
represent the Company's judgment as of the date of this release. The
Company disclaims however, any intent or obligation to update these
forward-looking statements.
SOUTHERN MISSOURI BANCORP, INC.
UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION
Selected Financial Data at: June 30, 2006 June 30, 2005
--------------------------- --------------- --------------
Total assets $350,684,000 $330,360,000
Available-for-sale securities 38,402,000 34,700,000
Loans, net 280,931,000 267,568,000
Allowance for losses on loans 2,058,000 2,017,000
Non-performing assets 269,000 658,000
Deposits 258,069,000 224,666,000
FHLB advances 46,000,000 61,500,000
Securities sold under repurchase
agreements 11,296,000 10,757,000
Subordinated debt 7,217,000 7,217,000
Stockholders' equity 26,554,000 25,003,000
Equity to assets ratio 7.57% 7.57%
Allowance as a percentage of loans 0.73% 0.75%
Non-performing loans as a percentage of
loans 0.02% 0.21%
Per common share:
Closing market price 13.00 14.50
Tangible book value 10.86 10.07
Three Months Ended Twelve Months Ended
June 30, June 30,
Selected Operating
Data: 2006 2005 2006 2005
---------------------- ----------- ----------- ----------- -----------
Net interest income $2,520,000 $2,270,000 $9,600,000 $9,252,000
Provision for losses
on loans 270,000 1,960,000 555,000 4,815,000
Non-interest income 566,000 536,000 2,144,000 2,313,000
Non-interest expense 1,734,000 1,816,000 7,028,000 6,728,000
Income taxes 303,000 (383,000) 1,377,000 (82,000)
----------- ----------- ----------- -----------
Net income $779,000 $(587,000) $2,784,000 $104,000
Per common share:
Net earnings:
Basic $0.35 $(.26) $1.25 $.05
Diluted $0.35 $(.26) $1.24 $.05
Cash dividends $.09 $.09 $.36 $.36
Average basic shares
outstanding 2,225,731 2,224,682 2,224,409 2,225,493
Average diluted shares
outstanding 2,254,356 2,284,258 2,252,261 2,286,645
Profitability Ratios:
----------------------
Return on average
assets: .89% (.71%) .80% .03%
Return on average
common equity: 11.91% (9.10%) 10.83% .39%
Net interest margin 3.06% 2.98% 2.96% 3.06%
Net interest spread 2.77% 2.78% 2.69% 2.84%
Efficiency Ratio 56.2% 64.7% 59.8% 58.2%
Source: Southern Missouri Bancorp, Inc.
Contact: Southern Missouri Bancorp, Inc.
Greg Steffens, 573-778-1800