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First Financial Bankshares Announces First Quarter Earnings Results

ABILENE, Texas, April 18, 2019 /PRNewswire/ -- The Board of Directors of First Financial Bankshares, Inc. (FFIN) today reported earnings for the first quarter of 2019 of $38.25 million, up $3.73 million when compared with earnings of $34.52 million in the same quarter last year. Basic earnings per share were $0.56 for the first quarter of 2019 compared with $0.51 in the same quarter a year ago.

Net interest income for the first quarter of 2019 was $69.51 million compared with $65.45 million in the same quarter of 2018. The net interest margin, on a taxable equivalent basis, was 4.00 percent for the first quarter of 2019 compared to 4.02 percent in the fourth quarter of 2018 and 3.88 percent in the first quarter of 2018. Included in interest income for the first quarter of 2019 was $466 thousand, or two basis points in net interest margin, related to discount accretion from fair value accounting related to the Kingwood and Orange acquisitions.  

The provision for loan losses was $965 thousand in the first quarter of 2019 compared with $1.80 million in the fourth quarter of 2018 and $1.31 million in the first quarter of 2018. Nonperforming assets as a percentage of loans and foreclosed assets totaled 0.74 percent at March 31, 2019, compared with 0.75 percent at December 31, 2018, and 0.66 percent at March 31, 2018. Classified loans totaled $118.43 million at March 31, 2019, compared to $126.30 million at December 31, 2018, and $124.06 million at March 31, 2018.

Noninterest income in the first quarter of 2019 rose to $24.44 million compared with $24.42 million in the same quarter a year ago. Trust fees increased $75 thousand to $6.98 million in the first quarter of 2019 compared with $6.90 million in the same quarter last year, primarily due to continued growth in the fair value of Trust assets managed to $6.06 billion from $5.23 billion a year ago. Service charges on deposits increased 5.98 percent to $5.18 million compared with $4.88 million in the same quarter a year ago due to continued growth in net new accounts. Real estate mortgage fees increased 18.45 percent in the first quarter of 2019 to $3.47 million compared with $2.93 million in the same quarter a year ago. Offsetting these increases in the first quarter of 2019 was a decrease in gain on sale of securities of $1.22 million when compared to the same quarter of 2018.

Noninterest expense for the first quarter of 2019 totaled $47.37 million compared to $47.80 million in the first quarter of 2018. The Company's efficiency ratio in the first quarter of 2019 was 49.46 percent compared with 51.76 percent in the same quarter last year. The decrease in noninterest expense in the first quarter of 2019 when compared to the same quarter a year ago was primarily related to the Company recording $1.55 million in the first quarter of 2018 related to contract termination and conversion costs associated with the Kingwood acquisition. During the first quarter of 2019, salary and employee benefit costs rose to $27.42 million compared to $26.20 million in the same quarter a year ago, primarily driven by annual merit-based pay increases and the recognition of $900 thousand resulting from the Company's continued efforts to terminate its frozen defined benefit pension plan.

As of March 31, 2019, consolidated assets for the Company totaled $7.95 billion compared to $7.73 billion at December 31, 2018 and $7.57 billion at March 31, 2018. Loans totaled $4.00 billion at quarter end compared with loans of $3.98 billion at December 31, 2018, and $3.75 billion at March 31, 2018. Deposits totaled $6.35 billion at March 31, 2019, compared to $6.18 billion at December 31, 2018, and $6.19 billion at March 31, 2018. Shareholders' equity rose to $1.11 billion as of March 31, 2019, compared with $1.05 billion at December 31, 2018, and $969.81 million at March 31, 2018. 

"We are pleased to report a good first quarter for 2019 with solid earnings performance, as well as growth in loans and deposits," said F. Scott Dueser, Chairman, President and CEO. "We continue to work diligently to reduce expenses to improve our bottom line while looking for acquisition opportunities to better utilize our strong capital position and increase our return to our shareholders."

About First Financial Bankshares

Headquartered in Abilene, Texas, First Financial Bankshares, Inc. is a financial holding company that through its subsidiary, First Financial Bank, N.A., operates multiple banking regions with 73 locations in Texas, including Abilene, Acton, Albany, Aledo, Alvarado, Beaumont, Boyd, Bridgeport, Brock, Burleson, Cisco, Cleburne, Clyde, Conroe, Cut and Shoot, Decatur, Eastland, El Campo, Fort Worth, Fulshear, Glen Rose, Granbury, Grapevine, Hereford, Huntsville, Keller, Kingwood, Magnolia, Mauriceville, Merkel, Midlothian, Mineral Wells, Montgomery, Moran, New Waverly, Newton, Odessa, Orange, Palacios, Port Arthur, Ranger, Rising Star, Roby,  San  Angelo,  Southlake, Spring, Stephenville, Sweetwater, Tomball, Trent, Trophy Club, Vidor, Waxahachie, Weatherford, Willis, and Willow Park. The Company also operates First Financial Trust & Asset Management Company, N.A., with eight locations and First Technology Services, Inc., a technology operating company.

The Company is listed on The NASDAQ Global Select Market under the trading symbol FFIN.  For more information about First Financial Bankshares, please visit our website at http://www.ffin.com.

Certain statements contained herein may be considered "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon the belief of the Company's management, as well as assumptions made beyond information currently available to the Company's management, and may be, but not necessarily are, identified by such words as "expect", "plan", "anticipate", "target", "forecast" and "goal".  Because such "forward-looking statements" are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.  Factors that could cause actual results to differ materially from the Company's expectations include competition from other financial institutions and financial holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the  Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses, and similar variables.   Other key risks are described in the Company's reports filed with the Securities and Exchange Commission, which may be obtained under "Investor Relations-Documents/Filings" on the Company's Web site or by writing or calling the Company at 325.627.7155. Except as otherwise stated in this news announcement, the Company does not undertake any obligation to update publicly or revise any forward-looking statements because of new information, future events or otherwise.

FIRST FINANCIAL BANKSHARES, INC.

CONSOLIDATED FINANCIAL SUMMARY  (UNAUDITED) 

(In thousands, except share and per share data)




















As of




2019



2018


ASSETS



 Mar. 31, 



 Dec. 31,  



Sept. 30, 



June 30, 



Mar. 31, 


Cash and due from banks

$

176,278


$

207,835


$

164,998


$

178,217


$

130,979


Interest-bearing deposits in banks


197,758



40,812



34,511



99,499



67,060


Interest-bearing time deposits in banks


1,458



1,458



1,458



1,458



1,458


Fed funds sold


12,825



-



-



8,450



-


Investment securities


3,212,812



3,158,777



3,144,367



3,197,567



3,276,193


Loans



4,003,606



3,975,308



3,885,536



3,855,769



3,747,081



Allowance for loan losses


(51,585)



(51,202)



(50,871)



(49,951)



(49,499)


Net loans



3,952,021



3,924,106



3,834,665



3,805,818



3,697,582


Premises and equipment


135,321



133,421



130,815



130,366



126,446


Goodwill



171,565



171,565



171,565



171,565



171,565


Other intangible assets


2,850



3,118



3,342



3,620



4,004


Other assets



83,007



90,762



85,510



88,910



92,162



Total assets

$

7,945,895


$

7,731,854


$

7,571,231


$

7,685,470


$

7,567,449



















LIABILITIES AND SHAREHOLDERS'  EQUITY
















Noninterest-bearing deposits

$

2,165,745


$

2,116,107


$

2,146,984


$

2,105,953


$

2,111,116


Interest-bearing deposits


4,184,996



4,064,282



3,998,298



4,104,654



4,079,647



Total deposits


6,350,741



6,180,389



6,145,282



6,210,607



6,190,763


Borrowings



382,711



468,706



380,760



456,935



372,155


Other liabilities


104,921



29,464



49,450



32,300



34,717


Shareholders' equity


1,107,522



1,053,295



995,739



985,628



969,814



Total liabilities and shareholders' equity

$

7,945,895


$

7,731,854


$

7,571,231


$

7,685,470


$

7,567,449





















Quarter Ended




2019



2018


INCOME STATEMENTS


 Mar. 31,  



 Dec. 31,  



 Sept. 30,  



 June 30,  



Mar. 31, 


Interest income


$

76,901


$

76,481


$

74,049


$

72,078


$

69,082


Interest expense


7,387



6,207



4,623



4,467



3,633


Net interest income


69,514



70,274



69,426



67,611



65,449


Provision for loan losses


965



1,800



1,450



1,105



1,310


Net interest income after provision for loan losses


68,549



68,474



67,976



66,506



64,139


Noninterest income


24,437



24,797



27,055



25,488



24,423


Noninterest expense


47,367



48,235



47,506



47,144



47,798



Net income before income taxes


45,619



45,036



47,525



44,850



40,764


Income tax expense


7,367



6,599



7,475



7,217



6,245



Net income

$

38,252


$

38,437


$

40,050


$

37,633


$

34,519



















PER COMMON SHARE DATA 
















Net income - basic

$

0.56


$

0.57


$

0.59


$

0.56


$

0.51


Net income - diluted


0.56



0.56



0.59



0.55



0.51


Cash dividends declared


0.21



0.21



0.21



0.21



0.19


Book Value


16.33



15.55



14.71



14.57



14.34


Market Value

$

57.78


$

57.69


$

59.10


$

50.90


$

46.30


Shares outstanding - end of period


67,840,210



67,753,133



67,693,586



67,669,658



67,612,760


Average outstanding shares - basic


67,747,127



67,676,204



67,635,058



67,597,275



67,527,010


Average outstanding shares - diluted


68,143,431



68,095,612



68,053,724



67,924,168



67,799,545



















PERFORMANCE RATIOS
















Return on average assets


2.00

%


2.00

%


2.10

%


1.98

%


1.84

%

Return on average equity


14.51



15.18



16.00



15.53



14.74


Return on average tangible equity


17.34



18.38



19.42



18.94



17.82


Net interest margin (tax equivalent)


4.00



4.02



4.01



3.92



3.88


Efficiency ratio


49.46



49.69



48.12



49.42



51.76



 

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)




















Quarter Ended




2019



2018


ALLOWANCE FOR LOAN LOSSES


 Mar. 31, 



 Dec. 31,  



 Sept. 30,  



June 30, 



Mar. 31, 


Balance at beginning of period

$

51,202


$

50,871


$

49,951


$

49,499


$

48,156


Loans charged off


(1,464)



(2,081)



(945)



(949)



(471)


Loan recoveries



882



612



415



296



504


Net recoveries (charge-offs)


(582)



(1,469)



(530)



(653)



33


Provision for loan losses


965



1,800



1,450



1,105



1,310


Balance at end of period

$

51,585


$

51,202


$

50,871


$

49,951


$

49,499



















Allowance for loan losses / period-end loans


1.29

%


1.29

%


1.31

%


1.30

%


1.32

%

















Allowance for loan losses / nonperforming loans


177.41



176.22



194.25



182.31



209.80


















Net charge-offs / average loans (annualized)


0.06



0.15



0.05



0.07



-



















SUMMARY OF LOAN CLASSIFICATION
















Special Mention


$

45,275


$

50,379


$

36,450


$

34,557


$

40,079


Substandard



73,158



75,919



81,073



79,170



83,976


Doubtful



-



-



-



-



-



Total classified loans

$

118,433


$

126,298


$

117,523


$

113,727


$

124,055



















NONPERFORMING ASSETS
















Nonaccrual loans

$

28,508


$

27,534


$

25,587


$

26,685


$

22,752


Accruing troubled debt restructured loans


472



513



513



514



514


Accruing loans 90 days past due


97



1,008



88



200



327



Total nonperforming loans


29,077



29,055



26,188



27,399



23,593


Foreclosed assets


647



577



671



705



1,276



Total nonperforming assets

$

29,724


$

29,632


$

26,859


$

28,104


$

24,869



















As a % of loans and foreclosed assets


0.74

%


0.75

%


0.69

%


0.73

%


0.66

%

As a % of end of period total assets


0.37



0.38



0.35



0.37



0.33



















OIL AND GAS PORTFOLIO INFORMATION
















Oil and gas loans

$

107,335


$

113,536


$

112,039


$

103,381


$

86,218


Oil and gas loans as a % of total loans


2.68

%


2.86

%


2.88

%


2.68

%


2.30

%

Classified oil and gas loans


4,255



3,894



4,861



5,001



10,485


Nonaccrual oil and gas loans


669



1,048



1,825



1,629



1,460


Net charge-offs for oil and gas loans


-



-



-



-



-


Allowance for oil and gas loans as a % of oil and gas loans


3.22

%


3.23

%


3.28

%


3.48

%


3.64

%


















CAPITAL RATIOS
















Common equity Tier 1 capital ratio


19.86

%


19.47

%


19.19

%


18.68

%


18.43

%

Tier 1 capital ratio


19.86



19.47



19.19



18.68



18.43


Total capital ratio


21.00



20.61



20.34



19.81



19.58


Tier 1 leverage


12.08



11.85



11.57



11.14



10.90


Equity to assets


13.94



13.62



13.15



12.82



12.82






































Quarter Ended




2019



2018


NONINTEREST INCOME


 Mar. 31,  



 Dec. 31,  



 Sept. 30,  



 June 30,  



Mar. 31, 


Trust fees


$

6,979


$

6,915


$

7,291


$

7,070


$

6,904


Service charges on deposits


5,176



5,713



5,690



5,375



4,884


ATM, interchange and credit card fees


6,840



6,962



7,533



7,041



6,996


Real estate mortgage fees


3,474



3,439



4,834



3,951



2,933


Net gain on sale of available-for-sale securities


-



8



58



67



1,221


Net gain (loss) on sale of foreclosed assets


69



(85)



84



19



99


Net gain (loss) on sale of assets


-



5



(61)



-



(91)


Interest on loan recoveries


338



332



199



289



119


Other noninterest income


1,561



1,508



1,427



1,676



1,358



Total noninterest income

$

24,437


$

24,797


$

27,055


$

25,488


$

24,423



















NONINTEREST EXPENSE
















Salaries and employee benefits, excluding profit sharing

$

25,033


$

23,908


$

24,693


$

24,545


$

24,994


Loss from partial settlement of pension plan


900



1,546



-



-



-


Profit sharing expense


1,491



1,839



1,684



2,317



1,209


Net occupancy expense


2,763



2,583



2,900



2,806



2,883


Equipment expense


3,127



3,403



3,482



3,440



3,516


FDIC insurance premiums


538



565



570



632



566


ATM, interchange and credit card expenses


2,383



2,589



2,344



2,205



2,143


Legal, tax and professional fees


2,154



2,609



2,417



2,308



2,807


Audit fees


417



291



382



439



411


Printing, stationery and supplies


366



513



387



612



486


Amortization of intangible assets


269



223



279



384



387


Advertising and public relations


1,648



1,805



1,709



1,576



1,575


Operational and other losses


266



337



981



305



566


Software amortization and expense


923



755



540



479



524


Other noninterest expense


5,089



5,269



5,138



5,096



5,731



Total noninterest expense

$

47,367


$

48,235


$

47,506


$

47,144


$

47,798



















TAX EQUIVALENT YIELD ADJUSTMENT

$

1,819


$

1,996


$

2,242


$

2,289


$

2,467



 

FIRST FINANCIAL BANKSHARES, INC.

SELECTED FINANCIAL DATA (UNAUDITED)

(In thousands)
























Three Months Ended


Three Months Ended



Mar. 31, 2019


Dec. 31, 2018




Average



Tax Equivalent



Yield /




Average



Tax Equivalent



Yield /





Balance



Interest



Rate




Balance



Interest



Rate


Interest-earning assets:




















  Fed funds sold

$

4,894


$

34



2.79

%


$

1,620


$

10



2.54

%

  Interest-bearing deposits in nonaffiliated banks


100,258



585



2.36




41,511



240



2.30


  Taxable securities


1,924,863



13,289



2.76




1,957,638



13,384



2.73


  Tax exempt securities


1,226,457



11,279



3.68




1,206,728



11,482



3.81


  Loans


3,973,108



53,534



5.46




3,918,360



53,361



5.40


Total interest-earning assets


7,229,580


$

78,721



4.42

%



7,125,857


$

78,477



4.37

%

Noninterest-earning assets


508,368










493,244









Total assets

$

7,737,948









$

7,619,101





























Interest-bearing liabilities:




















  Deposits

$

4,144,091


$

6,662



0.65

%


$

3,961,582


$

5,092



0.51

%

  Fed funds purchased and other borrowings


408,641



726



0.72




484,054



1,115



0.91


Total interest-bearing liabilities


4,552,732


$

7,388



0.66

%



4,445,636


$

6,207



0.55

%

Noninterest-bearing liabilities 


2,116,080










2,169,069








Shareholders' equity


1,069,136










1,004,396









Total liabilities and shareholders' equity

$

7,737,948









$

7,619,101





























Net interest income and margin (tax equivalent)




$

71,333



4.00

%





$

72,270



4.02

%
























Three Months Ended


Three Months Ended



Sept. 30, 2018


June 30, 2018




Average



Tax Equivalent



Yield /




Average



Tax Equivalent



Yield /





Balance



Interest



Rate




Balance



Interest



Rate


Interest-earning assets:




















  Fed funds sold


$

3,377


$

19



2.29

%


$

2,228


$

13



2.32

%

  Interest-bearing deposits in nonaffiliated banks


88,118



450



2.03




59,373



258



1.74


  Taxable securities


1,943,125



12,594



2.59




2,007,949



12,719



2.53


  Tax exempt securities


1,213,212



11,459



3.78




1,281,757



12,001



3.75


  Loans



3,845,836



51,769



5.34




3,797,341



49,376



5.22


Total interest-earning assets


7,093,668


$

76,291



4.27

%



7,148,648


$

74,367



4.17

%

Noninterest-earning assets


490,155










486,837









Total assets

$

7,583,823









$

7,635,485





























Interest-bearing liabilities:




















  Deposits


$

4,035,174


$

4,329



0.43

%


$

4,076,522


$

4,005



0.39

%

  Fed funds purchased and other borrowings


399,026



294



0.29




434,239



462



0.43


Total interest-bearing liabilities


4,434,200


$

4,623



0.41

%



4,510,761


$

4,467



0.40

%

Noninterest-bearing liabilities 


2,156,258










2,152,451








Shareholders' equity


993,365










972,273









Total liabilities and shareholders' equity

$

7,583,823









$

7,635,485





























Net interest income and margin (tax equivalent)




$

71,668



4.01

%





$

69,900



3.92

%
























Three Months Ended













Mar. 31, 2018














Average



Tax Equivalent



Yield /















Balance



Interest



Rate












Interest-earning assets:




















  Fed funds sold


$

6,215


$

27



1.78

%











  Interest-bearing deposits in nonaffiliated banks


160,399



613



1.55












  Taxable securities


1,826,391



11,354



2.49












  Tax exempt securities


1,352,235



12,559



3.72












  Loans



3,748,561



46,995



5.08












Total interest-earning assets


7,093,801


$

71,548



4.09

%











Noninterest-earning assets


497,049



















Total assets

$

7,590,850







































Interest-bearing liabilities:




















  Deposits


$

4,139,324


$

3,519



0.34

%











  Fed funds purchased and other borrowings


357,414



113



0.13












Total interest-bearing liabilities


4,496,738


$

3,632



0.33

%











Noninterest-bearing liabilities 


2,144,065


















Shareholders' equity


950,047



















Total liabilities and shareholders' equity

$

7,590,850







































Net interest income and margin (tax equivalent)




$

67,916



3.88

%











 

Cision

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