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The Southern Banc Company, Inc. Announces Preliminary Fourth Quarter Earnings

GADSDEN, Ala., Aug. 26, 2019 (GLOBE NEWSWIRE) -- Gates Little, President and Chief Executive Officer of The Southern Banc Company, Inc. (SRNN), the holding company for The Southern Bank Company, announced preliminary unaudited results (subject to audit adjustments following the fiscal year-end audit) of operations for the fourth quarter and year ended June 30, 2019:

  • For the three months ended June 30, 2019, the Company reported net income of approximately $95,000, or $0.12 per basic and diluted share as compared to net income of approximately $61,000, or $0.08 per basic and diluted share, for the three months ended June 30, 2018. 
     
  • For the fiscal year ended June 30, 2019, the Company recorded net income of approximately $464,000, or $0.61 per basic and diluted share, as compared to a net loss of approximately $565,000, or $(0.74) per basic and diluted share, for the fiscal year ended June 30, 2018. The net loss for fiscal year 2018 included a one-time charge of $655,221 resulting from the enactment of 2018 Tax Reform Bill.
     
  • For the three months ended June 30, 2019, net interest income before provision for loan losses decreased approximately $220,000, or (16.9%) as compared to the same period in 2018. The decrease in net interest income for the three-month period was primarily attributable to a decrease in interest and fees on loans in the amount of approximately $222,000, a decrease in interest and dividends on securities of approximately $7,000 offset in part by an increase in other interest income of approximately $59,000 or 302.0%. The decrease in interest and fees on loans was primarily attributable to a decrease in factoring activity from some large clients, and a decrease in loans and leases outstanding.  The increase in other interest income was primarily attributable to interest income earned due to an increase in overnight funds of approximately $14.0 million. For the three months ended June 30, 2019, interest paid on deposits and borrowings increased approximately $50,000 as compared to the same period in 2018.
     
  • For the fiscal year ended June 30, 2019, interest income increased approximately $104,000, or 1.9% while interest expenses increased approximately $111,000, or 13.8%. The increase in interest income for the fiscal year ended June 30, 2019 was primarily attributable to an increase in interest income on overnight funds of approximately $156,000, or 324.0%. For the fiscal year ended June 30, 2019, total interest expense increased approximately $111,000, or 13.8% while provision for loan losses decreased approximately $753,000, or (97.44%) from $773,000 for fiscal year 2018 to $19,000 for fiscal year 2019.
     
  • For the fiscal year ended June 30, 2019, non-interest income increased approximately $13,000, or 8.2% from $157,000 for fiscal year 2018 to $170,000 for fiscal year 2019.  The increase in non-interest income was primarily attributable to an increase in miscellaneous income of approximately $18,000, primarily from sale of assets from terminated leases, offset in part by a decrease in customer service fees of approximately $7,000.
     
  • For the three months ended June 30, 2019 total non-interest expenses decreased approximately $20,000, or (2.0%), as compared to the same three-month period in 2018.  The decrease in non-interest expense for the three-month period was primarily attributable to a decrease in professional service expenses of approximately $58,000, or (42.1%) offset in part by an increase in salaries and benefits of approximately $44,000, or 7.8%.
     
  • For the fiscal year ended June 30, 2019, total non-interest expenses increased approximately $281,000, or 7.4%, as compared to fiscal year 2018.  The increase in non-interest expense for the fiscal year was primarily attributable to increases in professional services expense of approximately $38,000, or 9.0%, salary and benefit expenses of approximately $240,000, or 11.3%, and data processing service expenses of approximately $25,000, or 5.0% offset in part by a decrease in other operating expenses of approximately $31,000 or (5.4%).

The Company’s total assets at June 30, 2019 and June 30, 2018 were approximately $97.7 million and $94.1 million, respectively.  Total stockholders’ equity was approximately $11.8 million, or 12.0% of assets and $10.9 million, or 11.6% of assets at June 30, 2019 and 2018, respectively.

The unaudited financial information for the three and twelve months ended June 30, 2019 has been prepared on the same basis as our audited financial information and includes, in the opinion of management, all adjustments necessary to present the data for such periods.  The Company expects to release its final year end results and its related audited financial statements in October 2019, following completion of the year-end audit. Historical results are not necessarily indicative of future results. The Bank has four full service banking offices located in Gadsden, Albertville, Guntersville, and Centre, AL, and one loan production office in Birmingham, AL. The stock of The Southern Banc Company, Inc. is listed on the OTC Bulletin Board under the symbol “SRNN”.

Certain statements in this release contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which statements can generally be identified by the use of forward-looking terminology, such as “may,” “will,” “expect,” “estimate,” “anticipate,” “believe,” “target,” “plan,” “project,” “continue,” or the negatives thereof, or other variations thereon or similar terminology, and are made on the basis of management’s plans and current analyses of the Company, its business and the industry as a whole.  These forward-looking statements are subject to risks and uncertainties, including, but not limited to, economic conditions, competition, interest rate sensitivity and exposure to regulatory and legislative changes.  The above factors, in some cases, have affected, and in the future could affect the Company’s financial performance and could cause actual results to differ materially from those expressed or implied in such forward-looking statements, even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.

Contact: Gates Little
(256) 543-3860

(Selected financial data attached)


           
THE SOUTHERN BANC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollar Amounts in Thousands)
           
    June 30,     June 30,
    2019      2018 
    (Unaudited)      
           
ASSETS

 
         
CASH AND CASH EQUIVALENTS  $ 17,697     $ 4,208  
SECURITIES AVAILABLE FOR SALE, at fair value    18,567       19,599  
FEDERAL HOME LOAN BANK (FHLB) STOCK   177       429  
           
LOANS AND LEASES RECEIVABLE,
net of allowance for loan losses of $974 and $1,093, respectively 
  58,874       67,218  
PREMISES AND EQUIPMENT, net    783       715  
ACCRUED INTEREST AND DIVIDENDS RECEIVABLE   201       207  
PREPAID EXPENSES AND OTHER ASSETS   1,366       1,705  
           
TOTAL ASSETS  $ 97,665     $ 94,081  
           
           
LIABILITIES
 
         
DEPOSITS $ 82,341     $ 77,015  
FHLB ADVANCES   2,000       6,000  
OTHER LIABILITIES   1,564       156  
           
TOTAL LIABILITIES   85,905       83,171  
           
           
STOCKHOLDERS' EQUITY:
  Preferred stock, par value $.01 per share
    500,000 shares authorized, shares issued
    and outstanding—none
  0       0  
 Common stock, par value $.01 per share,
    3,500,000 authorized, 1,454,750 shares issued,
    806,086 shares outstanding
  15       15  
 Additional paid-in capital   13,887       13,887  
 Shares held in trust,
    39,260 shares at cost
    (706 )        (706 )
 Retained earnings   7,277       6,812  
 Treasury stock, at cost,
    648,664 shares
    (8,825 )       (8,825 )
 Accumulated other comprehensive income / (loss)   112       (273 )
 
TOTAL STOCKHOLDERS’ EQUITY
  11,760       10,910  
 
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$
97,665     $ 94,081  
           


           
THE SOUTHERN BANC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollar Amounts in Thousands, except per share data)
           
      Three Months Ended     Year Ended
    June 30,     June 30,
                     
    2019
(Unaudited)
    2018     2019
(Unaudited)
  2018 
                     
INTEREST INCOME:

 
                   
  Interest and fees on loans $ 1,147   $ 1,369   $ 4,831 $ 4,771  
  Interest and dividends on securities   112     119     447   559  
  Other interest income   78     19     204   48  
 
  Total interest income
  1,337     1,507      

5,482
   

5,378
 
 

INTEREST EXPENSE:
                   
  Interest on deposits   247     172     853   673  
  Interest on borrowings   8     33     65   134  
  Total interest expense   255     205     918   807  
  Net interest income before provision
  for loan losses
  1,082     1,302    
4,564
 
4,571
 
 Provision for loan losses   12     192     19   773  
  Net interest income after provision
    for loan losses
  1,070     1,110    
4,545
 
3,798
 
 

NON-INTEREST INCOME:
                   
  Fees and other non-interest income   30     32     120   127  
  Gain / (loss) on sale of securities, net   0     0     0   (2 )
  Miscellaneous income   26     5     50     32  
  Total non-interest income   56     37     170   157  
 

NON-INTEREST EXPENSE:
                   
  Salaries and employee benefits   593     549     2,359   2,119  
  Equipment and Occupancy expenses   59     51     233   224  
  Professional Services Expense   80     138     451   413  
  Data Processing Expense   123     125     504   479  
  Other operating expense   137     149     535   566  
  Total non-interest expense   992     1,012     4,082   3,801  
 INCOME BEFORE INCOME TAXES   134     135      
  633
   
  154
 
  Provision for income taxes    
  39
       74       169     719  
NET INCOME (LOSS) $ 95   $ 61   $ 464 $    (565
)


INCOME (LOSS) PER SHARE:
                     
  Basic $   0.12   $   0.08   $   0.61  $ (0.72 )
  Diluted $   0.12   $   0.08   $   0.61 $   (0.72 )
DIVIDENDS DECLARED PER SHARE $   ---   $   ---    

$
  ---  

$
  ---  
                     
AVERAGE SHARES OUTSTANDING:                    
  Basic    766,826      766,826      766,826    766,826  
  Diluted    766,826      766,826      766,826    766,826