story from Talk Business & Politics, a TCW content partner
The second quarter was kind to Pine Bluff-based Simmons First National Corp. and Conway-based Home BancShares Inc., with Simmons posting results that beat estimates and Home BancShares – the parent company of Centennial Bank – setting a new quarterly income record.
Simmons First reported better-than-expected second quarter earnings before the opening bell on Thursday (July 17), propelled upward by the Pine Bluff bank's continued shopping spree for strategic out-of-state assets and foreclosed FDIC properties.
For the period ended June 30, the Arkansas regional bank posted second quarter net income of 60 cents, or $9.9 million per share, up 53.8% from 39 cents a year ago. Analysts surveyed by MarketWatch had expected Simmons First to post second quarter earnings of 54 cents per share on revenue of $53.6 million.
“The second quarter was a landmark quarter for Simmons. We announced two acquisitions totaling approximately $3 billion in assets and reported record core earnings and record core earnings per share for the quarter,” George Makris Jr., chairman and CEO, said in a statement.
Overall, Simmons posted record core earnings of $9.2 million for the second quarter of 2014, an increase of $2.7 million, or 42.8%, compared to the same quarter last year. Diluted core earnings per share were a record $0.56, an increase of $0.17, or 43.6%. Core earnings exclude $755,000 in net after-tax earnings.
During the second quarter, Simmons announced two out-of-state acquisitions that will add nearly $3 billion in assets to the holding bank’s financial books. In late May, Simmons announced it planned to acquire all of the outstanding common stock of Springfield-based Liberty Bancshares Inc. in an all-stock transaction valued at nearly $207 million.
Earlier in the same month, Simmons entered into a similar agreement to buyout Community First Bancshares of Union City, Tenn., in a stock-deal value at more than $243 million. Both deals are expected to close by end of the year.
Here are other highlights of Simmons quarterly earnings report:
• Total loans, including those acquired, of $2.4 billion, increased by $512 million, or 27.3%, compared to a year ago.
• Total deposits jumped nearly 30% to $3.6 billion, an increase of $829 million from a year ago. Total non-time deposits totaled $2.6 billion, up 72%.
• Net interest income of $40.4 million, an increase of $10.8 million, or 36.7%, from the same period of 2013. This increase was driven by growth in the legacy loan portfolio and assets acquired through Simmons’ $53.6 million takeover of Metropolitan National Bank of Little Rock in late 2013, the bank said.
Simmons’s shares (NASDAQ: SFNC) closed Thursday at $37.63, down $1.79 in an overall market decline brought about by international incidents. During the past 52 weeks the share price has ranged from a $43.22 high to a $24.06 low.
Home BancShares reported record second quarter earnings, easily beating a year ago profits and matching Wall Street expectations to the penny.
For the period ended June 30, the bank posted quarterly profit of $28.4 million, or 43 cents per share, up nearly 60.5%, or $10.8 million, from $17.7 million and 31 cents a year ago. A survey of analysts polled by MarketWatch had expected the fast-growing Arkansas bank to report earnings of 43 cents per share.
Excluding after tax items, Home Bancshares reported second quarter earnings of 44 cents per share versus 32 cents a share a year ago. Company Chairman John Allison said he was pleased with the record quarterly results and is looking to continue to grow in the future.
“During the upcoming quarters, we recognize there is a need for organic loan growth,” Allison said. “We are encouraged by the opportunities we have in front of us because we currently have the largest unfunded loan pipeline in our history.”
During the second quarter, Home BancShares said it closed or merged four Arkansas and two Florida locations. In late April, Home BancShares purchased Traditions Bank of Florida in a stock deal worth $43 million. That transaction closed on Thursday (July 17). Following that deal, the Arkansas bank said it had $7.1 billion in total assets, $5.6 billion in deposits, $4.6 billion in loans and 156 branches across Arkansas, Florida and South Alabama.
Additional highlights of Home BancShares second quarter results include:
• Net interest income for the second quarter of 2014 increased 74% to $78 million from $44.8 million during the second quarter of 2013.
• Total non-covered loans were $4.13 billion at June 30, 2014. Total covered loans came in at $263.2 million for the same period.
• Stockholders’ equity was $897.2 million at June 30, 2014 compared to $841 million at December 31, 2013, an increase of $56.3 million.
Home BancShares (NASDAQ: HOMB) closed Thursday at $30, down $1.08 in the overall market decline. During the past 52 weeks the share price has ranged from a $38.98 high to a $24.83 low.