Business First Bancshares, Inc., Announces Financial Results for Fiscal Year 2023 and Q4 2023

Business First Bancshares, Inc.

BATON ROUGE, La., Jan. 23, 2024 (GLOBE NEWSWIRE) -- Business First Bancshares, Inc. (NASDAQ: BFST) (Business First), parent company of b1BANK, today announced its unaudited results for the year ended December 31, 2023, including net income available to common shareholders of $65.6 million or $2.59 per diluted common share, increases of $12.7 million and $0.27, respectively, from the prior year ended December 31, 2022. On a non-GAAP basis, core net income for the year ended December 31, 2023, which excludes certain income and expenses, was $66.3 million or $2.62 per diluted common share, increases of $8.7 million and $0.10, respectively, from prior year ended December 31, 2022.

For the quarter ended December 31, 2023, Business First reported net income available to common shareholders of $14.5 million, or $0.57 per diluted common share, decreases of $4.6 million and $0.19, respectively, from the quarter ended September 30, 2023. On a non-GAAP basis, core net income for the quarter ended December 31, 2023, which excludes certain income and expenses, was $16.8 million or $0.66 per diluted common share, decreases of $1.1 million and $0.05, respectively, compared to the linked quarter.

“There have been very few years in our company’s life of which I’ve been prouder than I am of the year 2023,” said Jude Melville, president and CEO. “As our country generally, and banking specifically, faced the challenge of navigating swiftly moving economic currents, our team was a source of stability, performing consistently and well for our clients and our investors.  We are a stronger organization and better bankers than we were at the beginning of the year, and I am excited to see that improvement continue over the course of 2024.”

On Tuesday, January 23, 2024, Business First’s board of directors declared a quarterly preferred dividend in the amount of $18.75 per share, which is the full quarterly dividend of 1.875% based on the per annum rate of 7.50%. Additionally, the board of directors declared a quarterly common dividend based upon financial performance for the fourth quarter in the amount of $0.14 per share. The preferred and common dividends will be paid on February 28, 2024, or as soon thereafter as practicable, to the shareholders of record as of February 15, 2024.

Quarterly Highlights

• Return on Assets and Equity. Return to common shareholders on average assets and common equity, each on an annualized basis, were 0.88% and 10.54% for the quarter ended December 31, 2023, compared to 1.17% and 14.16%, respectively, for the linked quarter. Non-GAAP core return on average assets and common equity, each on an annualized basis, were 1.03% and 12.27% for the quarter ended December 31, 2023, compared to 1.10% and 13.32%, respectively, for the linked quarter.

• Credit Quality. The ratios of nonperforming loans compared to loans held for investment and nonperforming assets compared to total assets remained stable at 0.34% and 0.28% at December 31, 2023, increasing slightly from 0.33% and 0.27%, respectively, at September 30, 2023, due to an increase in nonaccrual loans.

• Security/Balance Sheet Repositioning. During the fourth quarter, Business First executed a balance sheet repositioning related to its available-for-sale (AFS) security portfolio. Business First sold $71.5 million or approximately 8.13% of the December 31, 2023, portfolio, in treasury, agency and municipal securities, with a weighted average book yield of 1.98%. Business First redeployed the proceeds into agency securities with an average book yield of 5.17%, locking in higher yields while keeping duration consistent with the overall portfolio weighted average life. The repositioning resulted in a loss of $2.5 million with an estimated earn back of 1.1 years as of December 31, 2023.

• Net Interest Margin. For the quarter ended December 31, 2023, net interest income totaled $53.8 million and net interest margin and net interest spread were 3.50% and 2.53%, respectively, compared to $55.3 million, 3.61% and 2.68% for the linked quarter. Non-GAAP net interest margin and net interest spread (excluding loan discount accretion of $1.9 million) were 3.38% and 2.40%, respectively, for the quarter ended December 31, 2023, compared to 3.46% and 2.53% (excluding loan discount accretion of $2.4 million) for the linked quarter.

Statement of Financial Condition

Loans

Loans held for investment increased $72.5 million or 1.47%, 5.85% annualized, from the linked quarter. Loan growth from the linked quarter was largely attributable to net growth in the commercial and industrial (C&I) portfolio of $26.5 million and in the commercial real estate portfolio of $89.1 million, offset by a $39.0 million reduction in the construction and development (C&D) portfolio. Annual loan growth for fiscal year 2023, was $386.6 million or 8.39%.

The Dallas Fort Worth region produced 50.64% of net loan growth from the linked quarter based on unpaid principal balance, while the Greater New Orleans region produced 37.68%. Based on unpaid principal balances, Texas-based loans represent approximately 37% of the overall loan portfolio as of December 31, 2023.

Credit Quality

The ratios of nonperforming loans compared to loans held for investment and nonperforming assets compared to total assets remained stable at 0.34% and 0.28% at December 31, 2023, increasing slightly from 0.33% and 0.27%, respectively, at September 30, 2023, due to an increase in nonaccrual loans.

Securities

The securities portfolio increased $29.9 million or 3.51%, from the linked quarter. The increase was driven by positive fair value adjustments of $35.1 million. The securities portfolio, based on estimated fair value, represented 13.36% of total assets as of December 31, 2023.

During the fourth quarter, Business First executed a balance sheet repositioning related to its available-for-sale (“AFS”) security portfolio. Business First sold $71.5 million, or approximately 8.13% of the December 31, 2023, portfolio, in treasury, agency, and municipal securities, with a weighted average book yield of 1.98%. Business First re-deployed the proceeds into agency securities with an average book yield of 5.17%, locking in higher yields while keeping duration consistent with the overall portfolio weighted average life. The repositioning resulted in a loss of $2.5 million with an estimated earn back of 1.1 years as of December 31, 2023.

Deposits

Deposits increased $58.1 million or 1.12%, 4.44% annualized, for the quarter ended December 31, 2023. Annual deposit growth for fiscal year 2023, was $428.4 million or 8.89%.

During the quarter ended December 31, 2023, noninterest-bearing deposits decreased $113.3 million or 8.02% and interest-bearing deposits increased $171.4 million or 4.54%, compared to the linked quarter, with certificate of deposit (CD) accounts declining $75.3 million or 5.47%. Money market accounts increased $160.3 million or 13.55% from the linked quarter.

Borrowings

Borrowings decreased $7.4 million or 1.16%, from the linked quarter due to a decline in repurchase agreements and repayments on a Federal Home Loan Bank (FHLB) term loan.

Shareholders’ Equity

Accumulated other comprehensive income (AOCI) improved $27.7 million during the fourth quarter due to positive after-tax fair value adjustments in the securities portfolio. Book value per common share increased to $22.58 at December 31, 2023, compared to $21.01 at September 30, 2023, due to continued earnings growth and positive securities fair value adjustments. On a non-GAAP basis, tangible book value per common share increased to $18.62 at December 31, 2023, compared to $17.03 at September 30, 2023.

Results of Operations

Net Interest Income

For the quarter ended December 31, 2023, net interest income totaled $53.8 million, compared to $55.3 million from the linked quarter. Loan and interest-earning asset yields of 6.87% and 6.17%, respectively, increased 3 basis points and 7 basis points, respectively, compared to 6.84% and 6.10% from the linked quarter. Net interest margin and net interest spread were 3.50% and 2.53% compared to 3.61% and 2.68%, respectively, for the linked quarter. The overall cost of funds, which include noninterest-bearing deposits, increased from 2.59% to 2.79% or 20 basis points, from the linked quarter due to higher cost deposits and $30.8 million less in average noninterest bearing deposits.

Non-GAAP net interest income (excluding loan discount accretion of $1.9 million) totaled $51.8 million for the quarter ended December 31, 2023, compared to $52.9 million (excluding loan discount accretion of $2.4 million) from the linked quarter. Non-GAAP net interest margin and net interest spread (excluding loan discount accretion of $1.9 million) were 3.38% and 2.40%, respectively, for the quarter ended December 31, 2023, compared to 3.46% and 2.53% (excluding loan discount accretion of $2.4 million) for the linked quarter. Excluding loan discount accretion, loan yields increased 8 basis points to 6.72% from 6.64%, and interest earnings asset yields increased 11 basis points to 6.05% from 5.94%, compared to the linked quarter.

Provision for Credit Losses

During the quarter ended December 31, 2023, Business First recorded a provision for credit losses of $119,000, compared to $604,000 for the linked quarter. The current quarter’s reserve decreased largely due to adjustments associated with various qualitative factors.

Other Income

For the quarter ended December 31, 2023, other income decreased $3.5 million or 35.11%, compared to the linked quarter. The net decrease was largely attributable to a $2.5 million loss on sale of securities due to Business First’s security repositioning initiative, a $1.0 million loss in equity investment income, and a $919,000 gain related to a branch sale which occurred during the linked quarter, partially offset by $964,000 of back-to-back customer swap fee income which occurred during the quarter.

Other Expenses

For the quarter ended December 31, 2023, other expenses increased by $1.1 million or 2.87%, compared to the linked quarter. The net increase was largely attributable to $654,000 in customer fraud/operational losses within other expense, $490,000 in other real estate owned expenses ($432,000 was related to a former bank premises), and an additional $466,000 in data processing costs compared to the linked quarter, offset by a reduction of $700,000 to the ad valorem shares tax expense.

Return on Assets and Common Equity

Return to common shareholders on average assets and common equity, each on an annualized basis, were 0.88% and 10.54% for the quarter ended December 31, 2023, compared to 1.17% and 14.16%, respectively, for the linked quarter. Non-GAAP return to common shareholders on average assets and common equity, each on an annualized basis, were 1.03% and 12.27% for the quarter ended December 31, 2023, compared to 1.10% and 13.32%, respectively, for the linked quarter.

Conference Call and Webcast

Executive management will host a conference call and webcast to discuss results on
Tuesday, January 23, 2024, at 4:30 p.m. Central time. Interested parties may attend the call by dialing toll-free 1-800-715-9871 (North America only), conference ID 4061156, or asking for the Business First Bancshares conference call. The live webcast can be found at https://edge.media-server.com/mmc/p/gctma4g8. The corresponding slide presentation can be assessed the day of the presentation on b1BANK’s website at https://www.b1bank.com/shareholder-info.

About Business First Bancshares, Inc.

Business First Bancshares, Inc., (Nasdaq: BFST) through its banking subsidiary b1BANK, has $6.6 billion in assets, $6.0 billion in assets under management through b1BANK’s affiliate Smith Shellnut Wilson, LLC (SSW) (excludes $0.9 billion of b1BANK assets managed by SSW) and operates Banking Centers and Loan Production Offices in markets across Louisiana and the Dallas and Houston, Texas areas, providing commercial and personal banking products and services. Commercial banking services include commercial loans and letters of credit, working capital lines and equipment financing, and treasury management services. b1BANK was awarded #1 Best-In-State Bank, Louisiana, by Forbes and Statista, and is a multiyear winner of American Banker’s “Best Banks to Work For.” Visit b1BANK.com for more information.

Non-GAAP Financial Measures

This press release includes certain non-GAAP financial measures (e.g., referenced as “core” or “tangible”) intended to supplement, not substitute for, comparable GAAP measures. “Core” measures typically adjust income available to common shareholders for certain significant activities or transactions that, in management’s opinion, can distort period-to-period comparisons of Business First’s performance. Transactions that are typically excluded from non-GAAP “core” measures include realized and unrealized gains/losses on former bank premises and equipment, investment sales, acquisition-related expenses (including, but not limited to, legal costs, system conversion costs, severance and retention payments, etc.). “Tangible” measures adjust common equity by subtracting goodwill, core deposit intangibles, and customer intangibles, net of accumulated amortization. Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of Business First’s core business. These non-GAAP disclosures are not necessarily comparable to non-GAAP measures that may be presented by other companies. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of the tables below.

Special Note Regarding Forward-Looking Statements

Certain statements contained in this release may not be based on historical facts and are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “may,” “might,” “will,” “would,” “could,” or “intend.” We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors, including those factors specified in our Annual Report on Form 10-K and other public filings. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.

Additional Information

For additional information about Business First, you may obtain Business First’s reports that are filed with the Securities and Exchange Commission (SEC) free of charge by using the SEC’s EDGAR service on the SEC’s website at www.SEC.gov or by contacting the SEC for further information at 1-800-SEC-0330. Alternatively, these documents can be obtained free of charge from Business First by directing a request to: Business First Bancshares, Inc., 500 Laurel Street, Suite 101, Baton Rouge, Louisiana 70801, Attention: Corporate Secretary.

No Offer or Solicitation

This release does not constitute or form part of any offer to sell, or a solicitation of an offer to purchase, any securities of Business First. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

Misty Albrecht
b1BANK
225.286.7879
Misty.Albrecht@b1BANK.com

Business First Bancshares, Inc.
Selected Financial Information
(Unaudited)
	Three Months Ended
	December 31,			September 30,			December 31,
(Dollars in thousands)		2023			2023			2022
Balance Sheet Ratios
Loans (HFI) to Deposits		95.12	%		94.79	%		95.56	%
Shareholders' Equity to Assets Ratio		9.78	%		9.31	%		9.69	%
Loans Receivable Held for Investment (HFI)
Commercial (1)	$	1,358,838		$	1,332,384		$	1,153,873
Real Estate:
Commercial		2,217,928			2,128,855			2,020,406
Construction		669,798			708,835			722,074
Residential		682,394			686,921			656,378
Total Real Estate		3,570,120			3,524,611			3,398,858
Consumer and Other		63,827			63,278			53,445
Total Loans (Held for Investment)	$	4,992,785		$	4,920,273		$	4,606,176
Allowance for Loan Losses
Balance, Beginning of Period	$	41,129		$	42,013		$	35,201
Charge-offs – Quarterly		(1,039	)		(2,423	)		(387	)
Recoveries – Quarterly		152			685			313
Provision for Loan Losses – Quarterly		172			854			3,051
Balance, End of Period	$	40,414		$	41,129		$	38,178
Allowance for Loan Losses to Total Loans (HFI)		0.81	%		0.84	%		0.83	%
Allowance for Credit Losses to Total Loans (HFI) (2)		0.88	%		0.90	%		0.84	%
Net Charge-offs (Recoveries) to Average Quarterly Total Loans		0.02	%		0.04	%		0.00	%
Remaining Loan Purchase Discount	$	12,286		$	14,752		$	27,000
Nonperforming Assets
Nonperforming Loans:
Nonaccrual Loans (1)	$	16,943		$	16,029		$	11,054
Loans Past Due 90 Days or More (1)		127			247			335
Total Nonperforming Loans		17,070			16,276			11,389
Other Nonperforming Assets:
Other Real Estate Owned		1,685			1,558			1,372
Other Nonperforming Assets		-			-			62
Total Other Nonperforming Assets		1,685			1,558			1,434
Total Nonperforming Assets	$	18,755		$	17,834		$	12,823
Nonperforming Loans to Total Loans (HFI)		0.34	%		0.33	%		0.25	%
Nonperforming Assets to Total Assets		0.28	%		0.27	%		0.21	%
(1) Past due and nonaccrual loan amounts exclude acquired impaired loans, even if contractually past due or if the Company does not expect to receive payment in full, as the Company was currently accreting interest income over the expected life of the loans for the period ended December 31, 2023, in accordance with ASC 310-30.
(2) Allowance for Credit Losses includes the Allowance for Loan Loss and Reserve for Unfunded Commitments.

Business First Bancshares, Inc.
Selected Financial Information
(Unaudited)
	Three Months Ended										Year Ended
	December 31,			September 30,			December 31,				December 31,			December 31,
(Dollars in thousands, except per share data)		2023			2023			2022				2023			2022
Per Share Data
Basic Earnings per Common Share	$	0.58		$	0.76		$	0.68			$	2.62		$	2.34
Diluted Earnings per Common Share		0.57			0.76			0.67				2.59			2.32
Dividends per Common Share		0.14			0.12			0.12				0.50			0.48
Book Value per Common Share		22.58			21.01			20.25				22.58			20.25
Average Common Shares Outstanding		25,116,688			25,111,548			24,542,120				25,079,106			22,633,478
Average Diluted Common Shares Outstanding		25,333,913			25,288,660			24,757,143				25,296,200			22,817,493
End of Period Common Shares Outstanding		25,351,809			25,344,168			25,110,313				25,351,209			25,110,313
Annualized Performance Ratios
Return to Common Shareholders on Average Assets (1)		0.88	%		1.17	%		1.12	%			1.04	%		0.97	%
Return to Common Shareholders on Average Common Equity (1)		10.54	%		14.16	%		13.56	%			12.36	%		11.59	%
Net Interest Margin (1)		3.50	%		3.61	%		4.06	%			3.62	%		3.92	%
Net Interest Spread (1)		2.53	%		2.68	%		3.43	%			2.72	%		3.57	%
Efficiency Ratio (2)		63.36	%		59.23	%		59.60	%			61.61	%		65.26	%
Total Quarterly/Year-to-Date Average Assets	$	6,494,861		$	6,474,935		$	5,899,972			$	6,341,880		$	5,473,508
Total Quarterly/Year-to-Date Average Common Equity		544,628			535,211			486,338				530,956			456,388
Other Expenses
Salaries and Employee Benefits	$	22,609		$	22,487		$	22,205			$	90,611		$	85,222
Occupancy and Bank Premises		2,387			2,428			2,285				9,518			9,244
Depreciation and Amortization		1,647			1,690			1,700				6,767			6,853
Data Processing		2,490			2,024			2,201				9,034			8,358
FDIC Assessment Fees		841			779			611				3,645			2,854
Legal and Other Professional Fees		833			766			462				3,173			2,359
Advertising and Promotions		1,052			1,202			1,571				4,628			3,949
Utilities and Communications		700			758			759				2,899			3,193
Ad Valorem Shares Tax		265			965			962				3,160			3,400
Directors' Fees		262			278			270				1,079			972
Other Real Estate Owned Expenses and Write-Downs		504			14			11				687			193
Merger and Conversion-Related Expenses		63			2			138				236			4,808
Other		6,061			5,214			5,171				21,265			18,004
Total Other Expenses	$	39,714		$	38,607		$	38,346			$	156,702		$	149,409
Other Income
Service Charges on Deposit Accounts	$	2,470		$	2,540		$	2,265			$	9,704		$	8,272
Loss on Sales of Securities		(2,503	)		-			(2	)			(2,565	)		(48	)
Debit Card and ATM Fee Income		1,793			1,581			1,582				6,590			6,407
Bank-Owned Life Insurance Income		572			604			526				2,247			1,931
Gain on Sales of Loans		546			321			59				1,972			574
Mortgage Origination Income		47			108			105				285			532
Fees and Brokerage Commission		1,710			1,933			1,760				7,247			6,964
Gain on Sales of Other Real Estate Owned		338			85			3				646			33
Loss on Disposal of Other Assets		(1	)		(23	)		(1	)			(15	)		(717	)
Gain on Sale of Branch		13			932			-				945			-
Gain on Extinguishment of Debt		-			517			-				1,458			-
Swap Fee Income		964			-			-				964			-
Pass-Through Income (Loss) from Other Investments		(1,028	)		(11	)		608				1,946			1,347
Other		1,492			1,296			1,373				5,218			4,015
Total Other Income	$	6,413		$	9,883		$	8,278			$	36,642		$	29,310
(1) Average outstanding balances are determined utilizing monthly averages and average yield/rate is calculated utilizing an Actual/365 day count convention.
(2) Noninterest expense (excluding provision for loan losses) divided by noninterest income plus net interest income less gain/loss on sales of securities.

Business First Bancshares, Inc.
Consolidated Balance Sheets
(Unaudited)
	December 31,			September 30,			December 31,
(Dollars in thousands)		2023			2023			2022
Assets
Cash and Due From Banks	$	226,110		$	191,461		$	152,740
Federal Funds Sold		151,134			196,616			15,606
Securities Available for Sale, at Fair Values		879,571			849,704			890,751
Mortgage Loans Held for Sale		835			652			304
Loans and Lease Receivable		4,992,785			4,920,273			4,606,176
Allowance for Loan Losses		(40,414	)		(41,129	)		(38,178	)
Net Loans and Lease Receivable		4,952,371			4,879,144			4,567,998
Premises and Equipment, Net		69,480			64,674			63,177
Accrued Interest Receivable		29,916			28,060			25,666
Other Equity Securities		33,942			32,591			37,467
Other Real Estate Owned		1,685			1,558			1,372
Cash Value of Life Insurance		96,478			95,906			91,958
Deferred Taxes, Net		27,323			34,660			31,194
Goodwill		88,391			88,391			88,543
Core Deposit and Customer Intangibles		11,895			12,418			14,042
Other Assets		15,419			12,946			9,642
Total Assets	$	6,584,550		$	6,488,781		$	5,990,460
Liabilities
Deposits
Noninterest-Bearing	$	1,299,090		$	1,412,406		$	1,549,381
Interest-Bearing		3,949,700			3,778,317			3,270,964
Total Deposits		5,248,790			5,190,723			4,820,345
Securities Sold Under Agreements to Repurchase		18,885			23,245			20,208
Federal Funds Purchased		-			-			14,057
Bank Term Funding Program		300,000			300,000			-
Federal Home Loan Bank Borrowings		211,198			214,184			410,100
Subordinated Debt		99,990			100,048			110,749
Subordinated Debt - Trust Preferred Securities		5,000			5,000			5,000
Accrued Interest Payable		14,841			11,188			2,092
Other Liabilities		41,587			40,027			27,428
Total Liabilities		5,940,291			5,884,415			5,409,979
Shareholders' Equity
Preferred Stock		71,930			71,930			71,930
Common Stock		25,352			25,344			25,110
Additional Paid-In Capital		397,447			396,121			393,690
Retained Earnings		216,115			205,207			163,955
Accumulated Other Comprehensive Loss		(66,585	)		(94,236	)		(74,204	)
Total Shareholders' Equity		644,259			604,366			580,481
Total Liabilities and Shareholders' Equity	$	6,584,550		$	6,488,781		$	5,990,460

Business First Bancshares, Inc.
Consolidated Statements of Income
(Unaudited)
	Three Months Ended									Year Ended
	December 31,			September 30,		December 31,				December 31,			December 31,
(Dollars in thousands)		2023			2023		2022				2023			2022
Interest Income:
Interest and Fees on Loans	$	85,761		$	84,575	$	69,364			$	323,327		$	218,032
Interest and Dividends on Securities		5,193			5,053		4,316				20,125			16,503
Interest on Federal Funds Sold and Due From Banks		3,711			3,694		825				9,875			1,579
Total Interest Income		94,665			93,322		74,505				353,327			236,114
Interest Expense:
Interest on Deposits		34,190			30,110		13,307				106,908			24,413
Interest on Borrowings		6,715			7,918		5,138				31,290			12,124
Total Interest Expense		40,905			38,028		18,445				138,198			36,537
Net Interest Income		53,760			55,294		56,060				215,129			199,577
Provision for Credit Losses		119			604		3,051				4,483			10,886
Net Interest Income After Provision for Credit Losses		53,641			54,690		53,009				210,646			188,691
Other Income:
Service Charges on Deposit Accounts		2,470			2,540		2,265				9,704			8,272
Loss on Sales of Securities		(2,503	)		-		(2	)			(2,565	)		(48	)
Gain on Sales of Loans		546			321		59				1,972			574
Other Income		5,900			7,022		5,956				27,531			20,512
Total Other Income		6,413			9,883		8,278				36,642			29,310
Other Expenses:
Salaries and Employee Benefits		22,609			22,487		22,205				90,611			85,222
Occupancy and Equipment Expense		5,301			5,445		4,918				20,859			19,367
Merger and Conversion-Related Expense		63			2		138				236			4,808
Other Expenses		11,741			10,673		11,085				44,996			40,012
Total Other Expenses		39,714			38,607		38,346				156,702			149,409
Income Before Income Taxes		20,340			25,966		22,941				90,586			68,592
Provision for Income Taxes		4,516			5,511		4,974				19,543			14,337
Net Income		15,824			20,455		17,967				71,043			54,255
Preferred Stock Dividends		1,350			1,351		1,350				5,401			1,350
Net Income Available to Common Shareholders	$	14,474		$	19,104	$	16,617			$	65,642		$	52,905

Business First Bancshares, Inc.
Consolidated Net Interest Margin
(Unaudited)
	Three Months Ended
	December 31, 2023								September 30, 2023								December 31, 2022
	Average								Average								Average
	Outstanding			Interest Earned /		Average			Outstanding			Interest Earned /		Average			Outstanding			Interest Earned /		Average
(Dollars in thousands)	Balance			Interest Paid		Yield / Rate			Balance			Interest Paid		Yield / Rate			Balance			Interest Paid		Yield / Rate
Assets
Interest-Earning Assets:
Total Loans	$	4,949,954		$	85,761	6.87	%		$	4,906,917		$	84,575	6.84	%		$	4,519,643		$	69,364	6.09	%
Securities		865,372			5,193	2.38	%			885,792			5,053	2.26	%			901,236			4,316	1.90	%
Interest-Bearing Deposit in Other Banks		271,004			3,711	5.43	%			278,420			3,694	5.26	%			62,013			825	5.28	%
Total Interest-Earning Assets		6,086,330			94,665	6.17	%			6,071,129			93,322	6.10	%			5,482,892			74,505	5.39	%
Allowance for Loan Losses		(40,996	)							(42,120	)							(35,951	)
Noninterest-Earning Assets		449,527								445,926								453,031
Total Assets	$	6,494,861		$	94,665				$	6,474,935		$	93,322				$	5,899,972		$	74,505
Liabilities and Shareholders' Equity
Interest-Bearing Liabilities:
Interest-Bearing Deposits	$	3,816,474		$	34,190	3.55	%		$	3,703,682		$	30,110	3.23	%		$	3,157,513		$	13,307	1.67	%
Subordinated Debt		100,009			1,320	5.24	%			100,400			1,363	5.39	%			110,800			1,363	4.88	%
Subordinated Debt - Trust Preferred Securities		5,000			113	8.97	%			5,000			111	8.81	%			5,000			85	6.74	%
Bank Term Funding Program		300,000			3,202	4.23	%			300,000			3,422	4.53	%			-			-	0.00	%
Advances from Federal Home Loan Bank (FHLB)		213,280			1,947	3.62	%			284,930			2,875	4.00	%			436,233			3,555	3.23	%
First National Bankers Bank Line of Credit		-			-	0.00	%			-			-	0.00	%			1,667			30	7.14	%
Other Borrowings		20,772			133	2.54	%			23,542			147	2.48	%			25,815			105	1.61	%
Total Interest-Bearing Liabilities		4,455,535			40,905	3.64	%			4,417,554			38,028	3.42	%			3,737,028			18,445	1.96	%
Noninterest-Bearing Liabilities:
Noninterest-Bearing Deposits	$	1,368,452							$	1,399,293							$	1,567,507
Other Liabilities		54,316								50,947								37,138
Total Noninterest-Bearing Liabilities		1,422,768								1,450,240								1,604,645
Shareholders' Equity:
Common Shareholders' Equity		544,628								535,211								486,338
Preferred Equity		71,930								71,930								71,961
Total Shareholders' Equity		616,558								607,141								558,299
Total Liabilities and Shareholders' Equity	$	6,494,861							$	6,474,935							$	5,899,972
Net Interest Spread						2.53	%							2.68	%							3.43	%
Net Interest Income				$	53,760							$	55,294							$	56,060
Net Interest Margin						3.50	%							3.61	%							4.06	%
Overall Cost of Funds						2.79	%							2.59	%							1.38	%
NOTE: Average outstanding balances are determined utilizing monthly averages and average yield/rate is calculated utilizing an Actual/365 day count convention.

Business First Bancshares, Inc.
Consolidated Net Interest Margin
(Unaudited)
	Year Ended
	December 31, 2023								December 31, 2022
	Average								Average
	Outstanding			Interest Earned /		Average			Outstanding			Interest Earned /		Average
(Dollars in thousands)	Balance			Interest Paid		Yield / Rate			Balance			Interest Paid		Yield / Rate
Assets
Interest-Earning Assets:
Total Loans	$	4,859,637		$	323,327	6.65	%		$	4,020,436		$	218,032	5.42	%
Securities		898,771			20,125	2.24	%			956,232			16,503	1.73	%
Interest-Bearing Deposit in Other Banks		180,997			9,875	5.46	%			115,016			1,579	1.37	%
Total Interest-Earning Assets		5,939,405			353,327	5.95	%			5,091,684			236,114	4.64	%
Allowance for Loan Losses		(41,665	)							(32,093	)
Noninterest-Earning Assets		444,140								413,917
Total Assets	$	6,341,880		$	353,327				$	5,473,508		$	236,114
Liabilities and Shareholders' Equity
Interest-Bearing Liabilities:
Interest-Bearing Deposits	$	3,566,216		$	106,908	3.00	%		$	3,007,882		$	24,413	0.81	%
Subordinated Debt		105,369			5,323	5.05	%			106,054			5,108	4.82	%
Subordinated Debt - Trust Preferred Securities		5,000			430	8.60	%			5,000			247	4.94	%
Bank Term Funding Program		253,706			11,313	4.46	%			-			-	0.00	%
Advances from Federal Home Loan Bank (FHLB)		329,726			13,702	4.16	%			271,025			6,479	2.39	%
First National Bankers Bank Line of Credit		-			-	0.00	%			2,500			121	4.84	%
Other Borrowings		21,825			522	2.39	%			23,197			169	0.73	%
Total Interest-Bearing Liabilities		4,281,842			138,198	3.23	%			3,415,658			36,537	1.07	%
Noninterest-Bearing Liabilities:
Noninterest-Bearing Deposits		1,412,979								1,539,938
Other Liabilities		44,173								37,533
Total Noninterest-Bearing Liabilities		1,457,152								1,577,471
Shareholders' Equity:
Common Shareholders' Equity		530,956								456,388
Preferred Equity		71,930								23,991
Total Shareholders' Equity		602,886								480,379
Total Liabilities and Shareholders' Equity	$	6,341,880							$	5,473,508
Net Interest Spread						2.72	%							3.57	%
Net Interest Income				$	215,129							$	199,577
Net Interest Margin						3.62	%							3.92	%
Overall Cost of Funds						2.43	%							0.74	%
NOTE: Average outstanding balances are determined utilizing monthly averages and average yield/rate is calculated utilizing an Actual/365 day count convention.

Business First Bancshares, Inc.
Non-GAAP Measures
(Unaudited)
	Three Months Ended										Year Ended
	December 31,			September 30,			December 31,				December 31,			December 31,
(Dollars in thousands, except per share data)		2023			2023			2022				2023			2022
Interest Income:
Interest income	$	94,665		$	93,322		$	74,505			$	353,327		$	236,114
Core interest income		94,665			93,322			74,505				353,327			236,114
Interest Expense:
Interest expense		40,905			38,028			18,445				138,198			36,537
Core interest expense		40,905			38,028			18,445				138,198			36,537
Provision for Credit Losses:(b)
Provision for credit losses		119			604			3,051				4,483			10,886
Core provision expense		119			604			3,051				4,483			10,886
Other Income:
Other income		6,413			9,883			8,278				36,642			29,310
Losses on former bank premises and equipment		-			-			-				-			717
Losses on sale of securities		2,503			-			2				2,565			48
Insurance reimbursement of storm expenditures		-			-			(422	)			-			(687	)
Gain on sale of branch		(13	)		(932	)		-				(945	)		-
Gain on extinguishment of debt		-			(517	)		-				(1,458	)		-
Core other income		8,903			8,434			7,858				36,804			29,388
Other Expense:
Other expense		39,714			38,607			38,346				156,702			149,409
Acquisition-related expenses (2)		(63	)		(2	)		(138	)			(236	)		(5,178	)
Write-down on former bank premises		(432	)									(432	)
Occupancy and bank premises - storm repair		-			-			-				-			(501	)
Core other expense		39,219			38,605			38,208				156,034			143,730
Pre-Tax Income:(a)
Pre-tax income		20,340			25,966			22,941				90,586			68,592
Losses on former bank premises and equipment		-			-			-				-			717
Losses on sale of securities		2,503			-			2				2,565			48
Insurance reimbursement of storm expenditures		-			-			(422	)			-			(687	)
Gain on sale of branch		(13	)		(932	)		-				(945	)		-
Gain on extinguishment of debt		-			(517	)		-				(1,458	)		-
Acquisition-related expenses (2)		63			2			138				236			5,178
Write-down on former bank premises		432										432
Occupancy and bank premises - storm repair		-			-			-				-			501
Core pre-tax income		23,325			24,519			22,659				91,416			74,349
Provision for Income Taxes:(1)
Provision for income taxes		4,516			5,511			4,974				19,543			14,337
Tax on losses on former bank premises and equipment		-			-			-				-			151
Tax on losses on sale of securities		529			-			-				542			10
Tax on insurance reimbursement of storm expenditures		-			-			(89	)			-			(144	)
Tax on gain on sale of branch		(3	)		(197	)		-				(200	)		-
Tax on gain on extinguishment of debt		-			(109	)		-				(308	)		-
Tax on acquisition-related expenses (2)		1			-			29				21			942
Tax on write-down on former bank premises		91										91
Tax on occupancy and bank premises - storm repair		-			-			-				-			106
Core provision for income taxes		5,134			5,205			4,914				19,689			15,402
Preferred Dividends:
Preferred dividends		1,350			1,351			1,350				5,401			1,350
Core preferred dividends		1,350			1,351			1,350				5,401			1,350
Net Income Available to Common Shareholders:
Net income available to common shareholders		14,474			19,104			16,617				65,642			52,905
Losses on former bank premises and equipment, net of tax		-			-			-				-			566
Losses on sale of securities, net of tax		1,974			-			2				2,023			38
Insurance reimbursement of storm expenditures, net of tax		-			-			(333	)			-			(543	)
Gain on sale of branch, net of tax		(10	)		(735	)		-				(745	)		-
Gain on extinguishment of debt, net of tax		-			(408	)		-				(1,150	)		-
Acquisition-related expenses (2), net of tax		62			2			109				215			4,236
Write-down on former bank premises, net of tax		341										341
Occupancy and bank premises - storm repair, net of tax		-			-			-				-			395
Core net income available to common shareholders	$	16,841		$	17,963		$	16,395			$	66,326		$	57,597
Pre-tax, pre-provision earnings available to common shareholders (a+b)	$	20,459		$	26,570		$	25,992			$	95,069		$	79,478
Losses on former bank premises and equipment		-			-			-				-			717
Loss on sale of securities		2,503			-			2				2,565			48
Insurance reimbursement of storm expenditures		-			-			(422	)			-			(687	)
Gain on sale of branch		(13	)		(932	)		-				(945	)		-
Gain on extinguishment of debt		-			(517	)		-				(1,458	)		-
Acquisition-related expenses (2)		63			2			138				236			5,178
Write-down on former premises		432										432
Occupancy and bank premises - storm repair		-			-			-				-			501
Core pre-tax, pre-provision earnings	$	23,444		$	25,123		$	25,710			$	95,899		$	85,235
Average Diluted Common Shares Outstanding		25,333,913			25,288,660			24,757,143				25,296,200			22,817,493
Diluted Earnings Per Common Share:
Diluted earnings per common share	$	0.57		$	0.76		$	0.67			$	2.59		$	2.32
Losses on former bank premises and equipment, net of tax		-			-			-				-			0.02
Loss on sale of securities, net of tax		0.08			-			-				0.08			-
Insurance reimbursement of storm expenditures, net of tax		-			-			(0.01	)			-			(0.02	)
Gain on sale of branch, net of tax		(0.00	)		(0.03	)		-				(0.03	)		-
Gain on extinguishment of debt, net of tax		-			(0.02	)		-				(0.04	)		-
Acquisition-related expenses (2), net of tax		0.00			-			-				0.01			0.18
Write-down on former premises, net of tax		0.01										0.01
Occupancy and bank premises -storm repair, net of tax		-			-			-				-			0.02
Core diluted earnings per common share	$	0.66		$	0.71		$	0.66			$	2.62		$	2.52
Pre-tax, pre-provision profit diluted earnings per common share	$	0.81		$	1.05		$	1.05			$	3.76		$	3.48
Losses on former bank premises and equipment		-			-			-				-			0.03
Loss on sale of securities		0.10			-			-				0.10			-
Insurance reimbursement of storm expenditures		-			-			(0.02	)			-			(0.03	)
Gain on sale of branch		(0.00	)		(0.04	)		-				(0.04	)		-
Gain on extinguishment of debt		-			(0.02	)		-				(0.06	)		-
Acquisition-related expenses (2)		0.00			-			0.01				0.01			0.23
Write-down on former premises		0.02										0.02
Occupancy and bank premises - storm repair		-			-			-				-			0.03
Core pre-tax, pre-provision diluted earnings per common share	$	0.93		$	0.99		$	1.04			$	3.79		$	3.74
(1) Tax rates, exclusive of certain nondeductible merger-related expenses and goodwill, utilized were 21.129% for 2023 and 2022. These rates approximated the marginal tax rates.
(2) Includes merger and conversion-related expenses and salary and employee benefits.

Business First Bancshares, Inc.
Non-GAAP Measures
(Unaudited)
	December 31,			September 30,			December 31,
(Dollars in thousands, except per share data)		2023			2023			2022
Total Shareholders' (Common) Equity:
Total shareholders' equity	$	644,259		$	604,366		$	580,481
Preferred stock		(71,930	)		(71,930	)		(71,930	)
Total common shareholders' equity		572,329			532,436			508,551
Goodwill		(88,391	)		(88,391	)		(88,543	)
Core deposit and customer intangible		(11,895	)		(12,418	)		(14,042	)
Total tangible common equity	$	472,043		$	431,627		$	405,966
Total Assets:
Total assets	$	6,584,550		$	6,488,781		$	5,990,460
Goodwill		(88,391	)		(88,391	)		(88,543	)
Core deposit and customer intangible		(11,895	)		(12,418	)		(14,042	)
Total tangible assets	$	6,484,264		$	6,387,972		$	5,887,875
Common shares outstanding		25,351,809			25,344,168			25,110,313
Book value per common share	$	22.58		$	21.01		$	20.25
Tangible book value per common share	$	18.62		$	17.03		$	16.17
Common equity to total assets		8.69	%		8.21	%		8.49	%
Tangible common equity to tangible assets		7.28	%		6.76	%		6.89	%

Business First Bancshares, Inc.
Non-GAAP Measures
(Unaudited)
	Three Months Ended										Year Ended
	December 31,			September 30,			December 31,				December 31,			December 31,
(Dollars in thousands, except per share data)		2023			2023			2022				2023			2022
Total Quarterly Average Assets	$	6,494,861		$	6,474,935		$	5,899,972			$	6,341,880		$	5,473,508
Total Quarterly Average Common Equity	$	544,628		$	535,211		$	486,338			$	530,956		$	456,388
Net Income Available to Common Shareholders:
Net income available to common shareholders	$	14,474		$	19,104		$	16,617			$	65,642		$	52,905
Losses on former bank premises and equipment, net of tax		-			-			-				-			566
Losses on sale of securities, net of tax		1,974			-			2				2,023			38
Insurance reimbursement of storm expenditures, net of tax		-			-			(333	)			-			(543	)
Gain on sale of branch, net of tax		(10	)		(735	)		-				(745	)		-
Gain on extinguishment of debt, net of tax		-			(408	)		-				(1,150	)		-
Acquisition-related expenses, net of tax		62			2			109				215			4,236
Write-down on former bank premises, net of tax		341			-			-				341			-
Occupancy and bank premises - storm repair, net of tax		-			-			-				-			395
Core net income available to common shareholders	$	16,841		$	17,963		$	16,395			$	66,326		$	57,597
Return to common shareholders on average assets (annualized) (2)		0.88	%		1.17	%		1.12	%			1.04	%		0.97	%
Core return on average assets (annualized) (2)		1.03	%		1.10	%		1.10	%			1.05	%		1.05	%
Return to common shareholders on average common equity (annualized) (2)		10.54	%		14.16	%		13.56	%			12.36	%		11.59	%
Core return on average common equity (annualized) (2)		12.27	%		13.32	%		13.37	%			12.49	%		12.62	%
Interest Income:
Interest income	$	94,665		$	93,322		$	74,505			$	353,327		$	236,114
Core interest income		94,665			93,322			74,505				353,327			236,114
Interest Expense:
Interest expense		40,905			38,028			18,445				138,198			36,537
Core interest expense		40,905			38,028			18,445				138,198			36,537
Other Income:
Other income		6,413			9,883			8,278				36,642			29,310
Losses on former bank premises and equipment		-			-			-				-			717
Loss on sale of securities		2,503			-			2				2,565			48
Insurance reimbursement of storm expenditures		-			-			(422	)			-			(687	)
Gain on sale of branch		(13	)		(932	)		-				(945	)		-
Gain on extinguishment of debt		-			(517	)		-				(1,458	)		-
Core other income		8,903			8,434			7,858				36,804			29,388
Other Expense:
Other expense		39,714			38,607			38,346				156,702			149,409
Acquisition-related expenses		(63	)		(2	)		(138	)			(236	)		(5,178	)
Write-down on former bank premises		(432	)		-			-				(432	)		-
Occupancy and bank premises - storm repair		-			-			-				-			(501	)
Core other expense	$	39,219		$	38,605		$	38,208			$	156,034		$	143,730
Efficiency Ratio:
Other expense (a)	$	39,714		$	38,607		$	38,346			$	156,702		$	149,409
Core other expense (c)	$	39,219		$	38,605		$	38,208			$	156,034		$	143,730
Net interest and other income (1) (b)	$	62,676		$	65,177		$	64,340			$	254,336		$	228,935
Core net interest and other income (1) (d)	$	62,663		$	63,728		$	63,918			$	251,933		$	228,965
Efficiency ratio (a/b)		63.36	%		59.23	%		59.60	%			61.61	%		65.26	%
Core efficiency ratio (c/d)		62.59	%		60.58	%		59.78	%			61.93	%		62.77	%
Total Average Interest-Earnings Assets	$	6,086,330		$	6,071,129		$	5,482,892			$	5,939,405		$	5,091,684
Net Interest Income:
Net interest income	$	53,760		$	55,294		$	56,060			$	215,129		$	199,577
Loan discount accretion		(1,921	)		(2,419	)		(4,212	)			(9,311	)		(9,432	)
Net interest income excluding loan discount accretion	$	51,839		$	52,875		$	51,848			$	205,818		$	190,145
Net interest margin (2)		3.50	%		3.61	%		4.06	%			3.62	%		3.92	%
Net interest margin excluding loan discount accretion (2)		3.38	%		3.46	%		3.75	%			3.47	%		3.73	%
Net interest spread (2)		2.53	%		2.68	%		3.43	%			2.72	%		3.57	%
Net interest spread excluding loan discount accretion (2)		2.40	%		2.53	%		3.13	%			2.56	%		3.38	%
(1) Excludes gains/losses on sales of securities.
(2) Calculated utilizing an Actual/365 day count convention.