Market Overview

Seacoast Reports Fourth Quarter and Full-Year 2017 Results

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Full-Year 2017 Net Income Increased 47% to $42.9 Million

Achieved 19% Growth in Year-Over-Year Tangible Book Value per Share

Fourth Quarter Net Income Increased 21% Over the Prior Year Quarter to $13.0 Million

STUART, Fla., Jan. 25, 2018 (GLOBE NEWSWIRE) -- Seacoast Banking Corporation of Florida ("Seacoast" or "the Company") (NASDAQ:SBCF) today reported net income of $13.0 million, or $0.28 per share for the fourth quarter of 2017, a 21% or $2.3 million increase from the fourth quarter of 2016. The Company reported fourth quarter adjusted net income1 of $17.3 million, or $0.37 per share, representing a 46% or $5.5 million increase from the fourth quarter of 2016.  Full-year 2017 net income was $42.9 million, or $0.99 per share, a 47% or $13.7 million increase compared to prior year results.  Full-year 2017 adjusted net income1 was $55.3 million, or $1.28 per share, a 42% or $16.3 million increase compared to prior year results.

For the fourth quarter 2017, return on average tangible assets was 0.97%, return on average tangible shareholders' equity was 10.7%, and the efficiency ratio was 64.0%, compared to 1.12%, 12.5% and 58.9%, respectively, in the prior quarter and 1.00%, 12.5%, and 62.4%, respectively, in the fourth quarter of 2016.  Adjusted return on average tangible assets1 was 1.23%, adjusted return on average tangible shareholders' equity1 was 13.5%, and the adjusted efficiency ratio1 was 52.6%, compared to 1.16%, 12.8%, and 57.7%, respectively, in the prior quarter, and 1.05%, 13.1%, and 60.8%, respectively, in the fourth quarter of 2016. 

Dennis S. Hudson, III, Seacoast's Chairman and CEO, said, "Seacoast's 2017 performance demonstrated our ability to consistently grow our banking franchise through both organic initiatives and prudent acquisitions, while simultaneously delivering record shareholder returns, highlighted by a 23% year-over-year increase in adjusted earnings per share. As we navigated the near-term impact of Hurricane Irma, we continued to drive earnings expansion while retaining the quality of our loan portfolio and investing to support our long-term growth objectives."

Hudson added, "We expect that the recently passed Tax Cuts and Jobs Act of 2017 will further strengthen economic fundamentals across Florida. Our expansion into South Florida, Orlando and Tampa positions Seacoast to capture this expected economic growth in the coming year as we provide a compelling value proposition for consumers and business customers living and operating in these markets."

Hudson concluded, "The continued execution of our balanced growth strategy, combined with the additional financial resources provided by the tax cut, will enable Seacoast to accelerate investments in our franchise, deliver incremental value for all stakeholders, and further advance our momentum toward our Vision 2020 objectives, which we introduced at our investor day last year."

Charles M. Shaffer, Seacoast's Chief Financial Officer, said, "We have been successful in allocating capital throughout the year into accretive opportunities, offsetting the initial dilution from our share issuance in February 2017. We have increased our tangible book value per share from $9.37 per share at the start of the year to $11.15 at year end, representing 19% growth in tangible capital per share.  We are exiting the year with a ratio of tangible common equity to tangible assets of 9.4% and a loan to deposit ratio of 83%, providing both capital and low-cost funding for accretive growth in 2018. Our low cost of funding and asset sensitive balance sheet position us well for continued earnings growth in 2018."

Update on Vision 2020 and the Tax Cuts and Jobs Act of 2017

We are confident in our ability to achieve our Vision 2020 targets announced at investor day in February of 2017.  The enactment of the Tax Cuts and Jobs Act of 2017 on December 22, 2017 should have a significant positive impact on the United States economy and growth in our Florida markets.  This clearly creates an opportunity for us to accelerate the achievement of our Vision 2020 objectives, through increased growth and appropriate investments.  As the impact of this new legislation on our operating markets materializes, we will provide further updates on our progress and updated objectives. 

  Vision 2020 Targets
Return on Tangible Assets 1.30%+
Return on Tangible Common Equity 16%+
Efficiency Ratio Below 50%

Notable Items Affecting Fourth Quarter 2017 Results; These Items are Excluded from the Presentation of Adjusted Results

  • Additional income tax expense of $8.6 million was recorded to write down the Company's net deferred tax asset as a result of the Tax Cuts and Jobs Act of 2017.  This estimate is subject to additional procedures which could result in further adjustments in future periods.
  • A $15.2 million gain on the sale of shares of Visa Class B stock was recorded in the fourth quarter.  These shares were purchased in early 2017.
  • Merger and acquisition related charges associated with the purchase of Palm Beach Community Bank and NorthStar Banking Corporation totaled $6.8 million.  These charges primarily represent change in control payments, legal and investment banking fees, and technology contract termination fees associated with the two acquisitions. 

 Update on Hurricane Impacts

  • The Company recorded a charge-off of $0.6 million related to a customer with a Caribbean export business which was severely impacted by the fall season hurricanes.
  • Loan pipelines and production across all business lines were disrupted by the storms, the result of business interruption over multiple weeks in the fourth quarter.

Fourth Quarter 2017 Financial Highlights

Income Statement

  • Net income was $13.0 million, or $0.28 per average common diluted share, compared to $14.2 million or $0.32 for the prior quarter and $10.8 million or $0.28 for the fourth quarter of 2016.  For the year ended December 31, 2017, net income was $42.9 million, or $0.99 per average common diluted share, compared to $29.2 million or $0.78 for the year ended December 31, 2016.  Adjusted net income1 was $17.3 million, or $0.37 per average common diluted share, compared to $15.1 million or $0.35 for the prior quarter and $11.8 million or $0.31 for the fourth quarter of 2016.  For the year ended December 31, 2017, adjusted net income1 was $55.3 million, or $1.28 per average common diluted share, compared to $39.1 million or $1.04 for the year ended December 31, 2016.
  • Net revenues were $74.9 million, an increase of $17.7 million or 31% compared to the prior quarter, and an increase of $27.5 million or 58% from the fourth quarter of 2016.  For the year ended December 31, 2017, net revenues were $234.8 million, an increase of $57.4 million or 32% compared to the year ended December 31, 2016. Adjusted revenues1 were $59.6 million, an increase of $2.4 million, or 4%, from the prior quarter and an increase of $12.3 million, or 26% from the fourth quarter of 2016.  For the year ended December 31, 2017, adjusted revenues1 were $219.5 million, an increase of $43.0 million or 24% compared to the year ended December 31, 2016.
  • Net interest income totaled $48.2 million, an increase of $2.5 million or 5% from the prior quarter and an increase of $10.8 million or 29% from the fourth quarter of 2016.  For the year ended December 31, 2017, net interest income totaled $176.3 million, an increase of $36.7 million or 26% compared to the year ended December 31, 2016.
  • Noninterest income totaled $26.6 million, an increase of $15.2 million or 133% compared to the prior quarter and an increase of $16.7 million or 168% from the fourth quarter of 2016. For the year ended December 31, 2017, noninterest income totaled $58.5 million, an increase of $20.7 million or 55% compared to the year ended December 31, 2016.  Adjusted noninterest income1 totaled $11.4 million for the quarter, in line with the prior quarter and an increase of $1.5 million or 15% from the fourth quarter of 2016.  For the year ended December 31, 2017, adjusted noninterest income1 totaled $43.2 million, an increase of $6.3 million or 17% compared to the year ended December 31, 2016.  During the quarter the Company sold $28.4 million of residential mortgages originated in prior quarters at a $477 thousand gross premium, recorded as mortgage banking fee income.  Brokerage commissions and fees were impacted by a transition during the quarter to a new broker-dealer, and by the effects of Hurricane Irma.  Looking forward, we expect the technology solution provided by the new broker-dealer to provide further opportunities for growth.  A focus on spend stimulation in the quarter drove additional growth in debit interchange income.
  • Net interest margin was 3.71% in the current quarter compared to 3.74% in the prior quarter and 3.56% in the fourth quarter of 2016.  For the year ended December 31, 2017, the net interest margin was 3.73% compared to 3.63% for the year ended December 31, 2016.   The net interest margin was affected this quarter when compared to the prior quarter by higher rates on deposits and lower non-cash related loan accretion. 
  • The provision for loan losses was $2.3 million compared to $0.7 million in the prior quarter and $1.0 million in the fourth quarter of 2016. The increase of $1.6 million in the current quarter primarily reflects the effect of higher charge-offs.  As discussed in the hurricane update above, $0.6 million of the current quarter charge-offs related to a single borrower whose business exporting to the Caribbean was significantly impacted by the storms.  For the year ended December 31, 2017, the provision for loan losses was $5.6 million compared to $2.4 million for the year ended December 31, 2016, primarily the result of organic growth in the portfolio. 
  • Noninterest expense was $39.2 million compared to $34.4 million in the prior quarter and $30.3 million in the fourth quarter of 2016. For the year ended December 31, 2017, noninterest expense was $150.0 million compared to $130.9 million in 2016.  Adjusted noninterest expense1 was $31.4 million compared to $32.8 million in the prior quarter, and $28.9 million in the fourth quarter of 2016.   For the year ended December 31, 2017, adjusted noninterest expense1 was $129.0 million compared to $114.2 million in 2016.  
    • The current quarter's noninterest expense includes an adjustment of $2.0 million of performance related incentives, and merger and acquisition related charges totaling $6.8 million.  The merger and acquisition related charges primarily represent change in control payments, legal fees and investment banking, and technology contract termination fees associated with the two acquisitions. 
  • Seacoast recorded a $20.4 million income tax provision in the current quarter, compared to $7.9 million in the prior quarter and $5.3 million in the fourth quarter of 2016. For the year ended December 31, 2017, the income tax provision was $36.3 million, compared to $14.9 million in 2016.  This quarter's tax provisioning included an $8.6 million charge for the write down of the company's net deferred tax asset associated with the Tax Cuts and Jobs Act of 2017. 
  • Fourth quarter 2017 adjusted revenues1 increased 4% compared to prior quarter, while adjusted noninterest expense1 decreased 4%, providing 8% operating leverage. Full-year 2017 adjusted revenues1 increased 24% compared to prior year results, while adjusted noninterest expense1 increased 13%, providing 11% operating leverage.
  • The efficiency ratio was 64.0% compared to 58.9% in the prior quarter and 62.4% in the fourth quarter of 2016.  For the year ended December 31, 2017, the efficiency ratio was 66.7% compared to 72.1% in 2016.  The adjusted efficiency ratio1 decreased to 52.6% compared to 57.7% in the prior quarter and 60.8% in the fourth quarter of 2016.  For the year ended December 31, 2017 the adjusted efficiency ratio decreased to 57.0% compared to 64.6% in 2016. 

Balance Sheet

  • At December 31, 2017, the Company had total assets of $5.8 billion and total shareholders' equity of $689.7 million.  Book value per share was $14.70 and tangible book value per share was $11.15, compared to $13.66 and $10.95, respectively, at September 30, 2017 and $11.45 and $9.37, respectively, at December 31, 2016.
  • Net loans totaled $3.8 billion at December 31, 2017, an increase of $432 million or 13% compared to September 30, 2017, and an increase of $934 million or 33% from December 31, 2016.  Excluding acquisitions, loans increased $278 million or 10% from December 31, 2016.
    • During the fourth quarter, commercial originations were $132 million, consumer and small business originations were $80 million, and closed residential loans retained were $75.6 million.
    • We continue to prudently manage CRE exposure. At 61% and 209% of total risk-based capital respectively, construction and land development and commercial real estate loan concentrations remain well below regulatory guidance. 
  • Pipelines (loans in underwriting and approval or approved and not yet closed) at year end continued to reflect the lingering effects of the fall season hurricanes.  At December 31, 2017, pipelines were $119 million in commercial, $49 million in mortgage, and $39 million in consumer and small business.
    • Commercial pipelines decreased by $36 million, or 23%, from prior quarter and have increased $30 million, or 34%, over year-ago levels.
    • Mortgage pipelines were lower by $15 million, or 24%, from prior quarter and by $24 million, or 33%, compared to year-ago levels. 
    • Consumer and small business decreased from prior quarter by $8 million, or 17%, and were lower than year-ago levels by $7 million, or 16%. 
  • Total deposits were $4.6 billion as of December 31, 2017, an increase of $480 million, or 12%, compared to September 30, 2017 and an increase of $1.1 billion, or 30%, from December 31, 2016.
    • During 2017, interest bearing deposits (interest bearing demand, savings and money markets deposits) increased $393 million, or 19%, to $2.4 billion, noninterest bearing demand deposits increased $252 million, or 22%, to $1.4 billion, and CDs increased $424 million, or 121%, to $776 million.
    • Excluding acquired deposits, noninterest bearing deposits increased 7% and total deposits increased 4% compared to December 31, 2016.   
    • The Company's balance sheet continues to be primarily core deposit funded. Core customer funding was $4.0 billion at December 31, 2017, compared to $3.6 billion at September 30, 2017 and $3.4 billion at December 31, 2016.
    • Organic deposits grew 2% compared to prior quarter, with annualized quarterly growth of 10%.
    • Overall cost of deposits in the fourth quarter was 0.29%, reflecting the significant value of the deposit franchise.
  • Fourth quarter return on average assets (ROA) was 0.91%, compared to 1.06% in the prior quarter and 0.94% from the fourth quarter of 2016. Return on average tangible assets (ROTA) was 0.97%, compared to 1.12% in the prior quarter and 1.00% in the fourth quarter of 2016. Adjusted ROTA1 was 1.23% compared to 1.16% in the prior quarter and 1.05% in the fourth quarter of 2016.

Capital

  • The common equity tier 1 capital ratio (CET1) was 12.0%, total capital ratio was 14.2% and the tier 1 leverage ratio was 10.6% at December 31, 2017. 
  • Tangible common equity to tangible assets was 9.4% at December 31, 2017, compared to 9.1% at September 30, 2017, and 7.7% at December 31, 2016. 

Asset Quality

  • Nonperforming loans to total loans outstanding was 0.47% at December 31, 2017, 0.42% at September 30, 2017, and 0.63% at December 31, 2016.
  • Nonperforming assets to total assets was 0.44% at December 31, 2017, 0.40% at September 30, 2017 and 0.60% at December 31, 2016.  Of the $25.7 million in nonperforming assets, $4 million related to five closed branch properties held as REO. 
  • The ratio of allowance for loan losses to total loans was 0.71% at December 31, 2017, 0.77% at September 30, 2017, and 0.81% at December 31, 2016.  The ratio of allowance for loan losses to non-acquired loans was 0.90% at December 31, 2017, 0.91% at September 30, 2017, and 0.96% at December 31, 2016.    The ratio of allowance for loan losses to acquired loans was 0.08% at December 31, 2017, 0.07% at September 30, 2017, and 0.03% at December 31, 2016. 
 
FINANCIAL HIGHLIGHTS
         
(Dollars in thousands, except per share data) 4Q17 3Q17 2Q17 1Q17 4Q16
           
Selected Balance Sheet Data (at period end):          
  Total Assets $ 5,810,129   5,340,299   5,281,295   4,769,775   4,680,932
  Gross Loans   3,817,377     3,384,991     3,330,075     2,973,759     2,879,536
  Total Deposits   4,592,720     4,112,600     3,975,458     3,678,645     3,523,245
           
Performance Measures:          
  Net Income $ 13,047   $ 14,216   $ 7,676   $ 7,926   $ 10,771
  Net Interest Margin     3.71%       3.74 %       3.84 %       3.63 %       3.56 %
  Average Diluted Shares Outstanding (000)   46,673     43,792     43,556     39,499     38,252
  Diluted Earnings Per Share (EPS) $   0.28   $   0.32   $   0.18   $   0.20   $   0.28
Return on (annualized):          
  Average Assets (ROA)   0.91%     1.06%     0.61%     0.68%     0.94%
  Average Tangible Common Equity (ROTCE)   10.7     12.5     7.3     8.8     12.5
Efficiency Ratio     64.0       58.9       73.9       71.1       62.4
           
Adjusted Operating Measures 1:          
  Adjusted Net Income $ 17,261   $ 15,145   $ 12,665   $ 10,270   $ 11,803
  Adjusted Diluted EPS     0.37       0.35       0.29       0.26       0.31
  Adjusted ROTA   1.23%     1.16%     1.02%     0.90%     1.05%
  Adjusted ROTCE     13.5       12.8     11.2     10.7     13.1
  Adjusted Efficiency Ratio     52.6       57.7     61.2     64.7     60.8
  Adjusted Noninterest Expenses as a
        Percentage of Average Tangible Assets
  2.24     2.50     2.73     2.71     2.56
           
Other Data          
  Market Capitalization2 $ 1,182,796   $ 1,039,506   $ 1,047,361   $ 976,368   $ 838,762
  Full Time Equivalent Employees   805     762     759     743     725
  Number of ATMs   85     74     76     76     77
  Full service banking offices   51     45     45     46     47
  Registered online users   83,881     78,880     75,394     71,385     67,243
  Registered mobile devices   62,516     58,032     55,013     50,729     47,131
                             

Non-GAAP measure, see "Explanation of Certain Unaudited Non-GAAP Financial Measures"
Effective in the first quarter of 2017, adjusted net income and adjusted noninterest expense exclude the effect of amortization of acquisition-related intangibles.  Prior periods have been revised to conform with the current period presentation.
2 Common shares outstanding multiplied by closing bid price on last day of each period.

Fourth Quarter and 2017 Strategic Highlights

Vision 2020, which we rolled out in the first quarter of last year, connects innovation and investments over the coming years to desired changes in our operating model, and to enhanced digital customer experience and shareholder returns. 

Our operational execution during 2017 has enabled us to remain on track to achieve our Vision 2020 objectives. In 2018, we'll invest a portion of the tax savings associated with the Tax Cuts and Jobs Act of 2017 to accelerate the achievement of these objectives.

Modernizing How We Sell

  • This year we continued our efforts to deepen customer relationships outside of our banking centers.  The number of deposit accounts opened through our website and 24/7 customer support center grew by 12% year over year.  Our Customer support center also originated $32.7 million in consumer and small business loans.
  • Our Commercial Banking and Operations teams partnered to increase efficiency across the loan origination process with a focus on optimizing technology, improving cycle time, and enhancing vendor partnerships.  This effort will continue well into 2018.

Lowering Our Cost to Serve

  • Customer adoption of more convenient digital channels continues to grow. This summer, non-teller transactions surpassed teller transactions and 41% of checks are now deposited outside of the banking center network, compared to 37% in December of 2016.  We expect this shift in customer preference to continue, requiring continued focus on building a digitally integrated business model.

Driving Improvements in How Our Business Operates

  • This year we successfully renegotiated our agreement with a key technology and digital services provider. The agreement expands digital banking capabilities, improves service level agreements, and increases our ability to scale.
  • In November, we consolidated our customer support center in Stuart, migrating all customer support operations to our Orlando location. The modernized, expanded site supports our 24/7 customer service model and our growth strategy.

Scaling and Evolving Our Culture

  • In the first quarter of 2018, a Chief Technology Officer was added to the executive team.
  • We also on-boarded key talent in the areas of data analysis, digital marketing, business-to-business marketing and compliance. These important additions to the Seacoast team help position us for future growth.

OTHER INFORMATION

Conference Call Information
Seacoast will host a conference call on Friday, January 26, 2018 at 10:00 a.m. (Eastern Time) to discuss the earnings results.  Investors may call in (toll-free) by dialing (888) 517-2458 (passcode: 6006 509). Slides will be used during the conference call and may be accessed at Seacoast's website at SeacoastBanking.com by selecting "Presentations" under the heading "Investor Services."  A replay of the call will be available for one month, beginning late afternoon of January 26, 2018 by dialing (888) 843-7419 and using passcode: 6006 509.

Alternatively, individuals may listen to the live webcast of the presentation by visiting Seacoast's website at SeacoastBanking.com. The link is located in the subsection "Presentations" under the heading "Investor Services." Beginning the afternoon of January 26, an archived version of the webcast can be accessed from this same subsection of the website.  The archived webcast will be available for one year.   

About Seacoast Banking Corporation of Florida (NASDAQ:SBCF)
Seacoast Banking Corporation of Florida is one of the largest community banks headquartered in Florida with approximately $5.8 billion in assets and $4.6 billion in deposits as of December 31, 2017. The Company provides integrated financial services including commercial and retail banking, wealth management, and mortgage services to customers through advanced banking solutions, 51 traditional branches of its locally-branded wholly-owned subsidiary bank, Seacoast Bank, and five commercial banking centers. Offices stretch from Ft. Lauderdale, Boca Raton and West Palm Beach north through the Daytona Beach area, into Orlando and Central Florida and the adjacent Tampa market, and west to Okeechobee and surrounding counties. More information about the Company is available at SeacoastBanking.com.

Cautionary Notice Regarding Forward-Looking Statements
This press release contains "forward-looking statements" within the meaning, and protections, of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements about future financial and operating results,  cost savings, enhanced revenues, economic and seasonal conditions in our markets, and improvements to reported earnings that may be realized from cost controls, tax law changes, and for integration of banks that we have acquired, or expect to acquire, as well as statements with respect to Seacoast's objectives, strategic plans, including Vision 2020, expectations and intentions and other statements that are not historical facts.  Actual results may differ from those set forth in the forward-looking statements.

Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, and involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the actual results, performance or achievements of Seacoast to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. You should not expect us to update any forward-looking statements. 

You can identify these forward-looking statements through our use of words such as "may," "will," "anticipate," "assume," "should," "support", "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "further", "point to," "project," "could," "intend" or other similar words and expressions of the future. These forward-looking statements may not be realized due to a variety of factors, including, without limitation: the effects of future economic and market conditions, including seasonality; governmental monetary and fiscal policies, as well as legislative, tax and regulatory changes; changes in accounting policies, rules and practices; the risks of changes in interest rates on the level and composition of deposits, loan demand, liquidity and the values of loan collateral, securities, and interest sensitive assets and liabilities; interest rate risks, sensitivities and the shape of the yield curve; the effects of competition from other commercial banks, thrifts, mortgage banking firms, consumer finance companies, credit unions, securities brokerage firms, insurance companies, money market and other mutual funds and other financial institutions operating in our market areas and elsewhere, including institutions operating regionally, nationally and internationally, together with such competitors offering banking products and services by mail, telephone, computer and the Internet; and the failure of assumptions underlying the establishment of reserves for possible loan losses.  The risks of mergers and acquisitions, include, without limitation: unexpected transaction costs, including the costs of integrating operations; the risks that the businesses will not be integrated successfully or that such integration may be more difficult, time-consuming or costly than expected; the potential failure to fully or timely realize expected revenues and revenue synergies, including as the result of revenues following the merger being lower than expected; the risk of deposit and customer attrition; any changes in deposit mix; unexpected operating and other costs, which may differ or change from expectations; the risks of customer and employee loss and business disruption, including, without limitation, as the result of difficulties in maintaining relationships with employees; increased competitive pressures and solicitations of customers by competitors; as well as the difficulties and risks inherent with entering new markets.

All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in our annual report on Form 10-K for the year ended December 31, 2016, under "Special Cautionary Notice Regarding Forward-looking Statements" and "Risk Factors", and otherwise in our SEC reports and filings. Such reports are available upon request from the Company, or from the Securities and Exchange Commission, including through the SEC's Internet website at http://www.sec.gov.

Charles M. Shaffer
Executive Vice President
Chief Financial Officer
(772) 221-7003
Chuck.Shaffer@seacoastbank.com


                             
FINANCIAL  HIGHLIGHTS          (Unaudited)                  
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES                 
                             
(Dollars in thousands, except per share data) Three Months Ended   Twelve Months Ended  
  December 31,   September 30,   June 30,   March 31,   December 31,   December 31,   December 31,  
    2017     2017     2017     2017     2016     2017     2016  
Summary of Earnings                            
Net income $    13,047   $   14,216   $   7,676   $   7,926   $   10,771   $   42,865   $   29,202  
Net interest income  (1)     48,402       45,903       44,320       38,377       37,628       177,002       140,514  
Net interest margin  (1), (2)     3.71 %     3.74 %     3.84 %     3.63 %     3.56 %     3.73 %     3.63 %
                             
Performance Ratios                            
Return on average assets-GAAP basis (2)     0.91 %     1.06 %     0.61 %     0.68 %     0.94 %     0.82 %     0.69 %
Return on average tangible assets (2),(3)     0.97       1.12       0.66       0.74       1.00       0.88       0.75  
Adjusted return on average tangible assets (2), (3), (5)     1.23       1.16       1.02       0.90       1.05       1.09       0.94  
                             
Return on average shareholders' equity-GAAP basis (2)     7.87       9.59       5.43       6.89       9.80       7.51       7.06  
Return on average tangible shareholders' equity-GAAP basis (2),(3)     10.69       12.45       7.25       8.77       12.51       9.90       8.87  
Adjusted return on average tangible common equity (2), (3), (5)     13.49       12.80       11.22       10.74       13.14       12.17       11.25  
Efficiency ratio (4)     63.95       58.93       73.90       71.08     62.36       66.68     72.13  
Adjusted efficiency ratio (5)     52.55       57.69       61.20       64.65     60.84       57.02     64.60  
Noninterest income to total revenue     35.49       20.06       19.16       20.61     20.96       24.88     21.14  
Average equity to average assets     11.50       11.06       11.17       9.93     9.56       10.96     9.85  
                             
Per Share Data                            
Net income diluted-GAAP basis $    0.28   $   0.32   $   0.18   $   0.20   $   0.28   $   0.99   $   0.78  
Net income basic-GAAP basis     0.29       0.33       0.18       0.20       0.29       1.01       0.79  
Adjusted earnings (5)     0.37       0.35       0.29       0.26       0.31       1.28       1.04  
                             
Book value per share common   14.70     13.66     13.29     12.34     11.45     14.70     11.45  
Tangible book value per share   11.15     10.95     10.55     10.41       9.37     11.15       9.37  
Cash dividends declared   0.00     0.00     0.00     0.00     0.00     0.00     0.00  
                             
                             
(1)  Calculated on a fully taxable equivalent basis using amortized cost. 
(2)  These ratios are stated on an annualized basis and are not necessarily indicative of future periods. 
(3)  The Company defines tangible assets as total assets less intangible assets, 
       and tangible common equity as total shareholders' equity less intangible assets. 
 
(4) Defined as (noninterest expense less gains, losses, and expenses on foreclosed properties) divided by net operating revenue 
     (net interest income on a fully taxable equivalent basis plus noninterest income excluding securities gains). 
(5) Non-GAAP measure - see "Explanation of Certain Unaudited Non-GAAP Financial Measures."    
   

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME  (Unaudited)              
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES                 
                     
  QUARTER   YTD
    2017       2016     December 31,   December 31,
(Dollars in thousands, except share and per share data) Fourth Third Second First   Fourth     2017       2016  
                     
Interest on securities:                    
  Taxable $    9,153   $   8,823   $   8,379 $   8,087     $   6,880     $   34,442     $   26,133  
  Nontaxable   231     189     206   287       287       913       1,036  
Interest and fees on loans   43,322     40,403     38,209   31,891       32,007       153,825       119,217  
Interest on federal funds sold and other investments   638     664     604   510       517       2,416       1,669  
  Total Interest Income   53,344     50,079     47,398   40,775       39,691       191,596       148,055  
                     
Interest on deposits   1,246     930     854   624       622       3,654       2,593  
Interest on time certificates   2,032     1,266     814   566       598       4,678       2,074  
Interest on borrowed money   1,840     2,134     1,574   1,420       1,046       6,968       3,800  
  Total Interest Expense   5,118     4,330     3,242   2,610       2,266       15,300       8,467  
                     
  Net Interest Income   48,226     45,749     44,156   38,165       37,425       176,296       139,588  
Provision for loan losses   2,263     680     1,401   1,304       1,000       5,648       2,411  
  Net Interest Income After Provision for Loan Losses   45,963     45,069     42,755   36,861       36,425       170,648       137,177  
                     
Noninterest income:                    
  Service charges on deposit accounts   2,566     2,626     2,435   2,422       2,612       10,049       9,669  
  Trust fees   941     967     917   880       969       3,705       3,433  
  Mortgage banking fees   1,487     2,138     1,272   1,552       1,616       6,449       5,864  
  Brokerage commissions and fees   273     351     351   377       480       1,352       2,044  
  Marine finance fees   313     137     326   134       115       910       673  
  Interchange income   2,836     2,582     2,671   2,494       2,334       10,583       9,227  
  Other deposit based EFT fees   111     100     114   140       125       465       477  
  BOLI income   1,100     836     757   733       611       3,426       2,213  
  Other   1,750     1,744     1,624   1,173       1,060       6,291       3,827  
    11,377     11,481     10,467   9,905       9,922       43,230       37,427  
  Gain on sale of VISA stock   15,153     0     0   0       0       15,153       0  
  Securities gains/(losses), net   112     (47 )   21   0       7       86       368  
  Total Noninterest Income   26,642     11,434     10,488   9,905       9,929       58,469       37,795  
                     
Noninterest expenses:                    
  Salaries and wages   16,321     15,627     18,375   15,369       12,476       65,692       54,096  
  Employee benefits   2,812     2,917     2,935   3,068       2,475       11,732       9,903  
  Outsourced data processing costs   4,160     3,231     3,456   3,269       3,076       14,116       13,516  
  Telephone / data lines   538     573     648   532       502       2,291       2,108  
  Occupancy    3,265     2,447     4,421   3,157       2,830       13,290       13,122  
  Furniture and equipment    1,806     1,191     1,679   1,391       1,211       6,067       4,720  
  Marketing    1,490     1,298     1,074   922       847       4,784       3,633  
  Legal and professional fees   3,054     2,560     3,276   2,132       2,370       11,022       9,596  
  FDIC assessments   558     548     650   570       661       2,326       2,365  
  Amortization of intangibles   964     839     839   719       719       3,361       2,486  
  Asset dispositions expense   105     117     136   53       84       411       553  
  Net loss/(gain) on other real estate owned and repossessed assets   (112 )   (414 )   161   (346 )     (161 )     (711 )     (509 )
  Early redemption cost for Federal Home Loan Bank advances   0     0     0   0       0       0       1,777  
  Other    4,223     3,427     3,975   3,910       3,207       15,535       13,515  
  Total Noninterest Expenses   39,184     34,361     41,625   34,746       30,297       149,916       130,881  
                     
  Income Before Income Taxes   33,421     22,142     11,618   12,020       16,057       79,201       44,091  
Income taxes   20,374     7,926     3,942   4,094       5,286       36,336       14,889  
                     
  Net Income $    13,047   $   14,216   $   7,676 $   7,926     $   10,771     $   42,865     $   29,202  
                     
Per share of common stock:                    
                     
  Net income diluted $    0.28   $   0.32   $   0.18 $   0.20     $   0.28     $   0.99     $   0.78  
  Net income basic   0.29     0.33       0.18     0.20       0.29       1.01       0.79  
  Cash dividends declared   0.00     0.00     0.00   0.00       0.00       0.00       0.00  
                     
Average diluted shares outstanding   46,672,538     43,792,108     43,556,285   39,498,835       38,252,351       43,350,314       37,508,046  
Average basic shares outstanding   45,541,099     43,151,248     42,841,152   38,839,284       37,603,789       42,613,086       36,872,007  
                                               

 

CONDENSED CONSOLIDATED BALANCE SHEETS   (Unaudited)      
SEACOAST  BANKING  CORPORATION  OF  FLORIDA  AND  SUBSIDIARIES         
           
  December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands, except share data)   2017     2017     2017     2017     2016  
           
Assets          
  Cash and due from banks $    104,039   $   114,621       88,133   $   133,923   $   82,520  
  Interest bearing deposits with other banks     5,465       10,657       20,064       10,914       27,124  
  Total Cash and Cash Equivalents   109,504     125,278     108,197     144,837     109,644  
           
  Time deposits with other banks   12,553     14,591     16,426     0     0  
           
  Securities:          
  Available for sale (at fair value)   955,804     996,799     1,016,744     909,275     950,503  
  Held to maturity (at amortized cost)   416,863     374,773     397,096     379,657     372,498  
  Total Securities    1,372,667     1,371,572     1,413,840     1,288,932     1,323,001  
           
  Loans held for sale   24,306     29,447     22,262     16,326     15,332  
           
  Loans   3,817,377     3,384,991     3,330,075     2,973,759     2,879,536  
  Less: Allowance for loan losses   (27,122 )   (26,232 )   (26,000 )   (24,562 )   (23,400 )
  Net Loans   3,790,255     3,358,759     3,304,075     2,949,197     2,856,136  
           
  Bank premises and equipment, net   66,883     57,092     56,765     58,611     58,684  
  Other real estate owned   7,640     7,142     8,497     7,885     9,949  
  Goodwill   147,578     101,747     101,739     64,649     64,649  
  Other intangible assets, net   19,099     16,102     16,941     13,853     14,572  
  Bank owned life insurance   123,981     118,762     88,003     85,237     84,580  
  Net deferred tax assets   25,417     43,951     52,195     55,834     60,818  
  Other assets   110,246     95,856     92,355     84,414     83,567  
  Total Assets $    5,810,129   $   5,340,299   $   5,281,295   $   4,769,775   $   4,680,932  
           
Liabilities and Shareholders' Equity          
Liabilities          
  Deposits          
  Noninterest demand $    1,400,227   $   1,284,118   $   1,308,458   $   1,225,124   $   1,148,309  
  Interest-bearing demand     1,050,755     935,097     934,861     870,457     873,727  
  Savings     434,346     379,499     376,825     363,140     346,662  
  Money market     931,458     870,788     861,119     821,606     802,697  
  Other time certificates     202,430     155,027     155,265     153,840     159,887  
  Brokered time certificates     217,385     281,551     149,270     66,741     7,342  
  Time certificates of $100,000 or more     356,119     206,520     189,660     177,737     184,621  
  Total Deposits   4,592,720     4,112,600     3,975,458     3,678,645     3,523,245  
           
  Securities sold under agreements to repurchase   216,094     142,153     167,558     183,107     204,202  
  Federal Home Loan Bank borrowings   211,000     389,000     395,000     302,000     415,000  
  Subordinated debt   70,521     70,451     70,381     70,311     70,241  
  Other liabilities   30,130     31,654     95,521     33,218     32,847  
  Total Liabilities   5,120,465     4,745,858     4,703,918     4,267,281     4,245,535  
           
Shareholders' Equity          
  Common stock   4,693       4,351       4,339       4,075       3,802  
  Additional paid in capital   661,632       576,825       574,842       510,806       454,001  
  Accumulated earnings/(deficit)   29,208       16,161       1,945       (5,731 )     (13,657 )
  Treasury stock   (2,359 )     (1,730 )     (1,768 )     (1,172 )     (1,236 )
    693,174     595,607     579,358     507,978     442,910  
  Accumulated other comprehensive income/(loss), net   (3,510 )   (1,166 )   (1,981 )   (5,484 )   (7,513 )
  Total Shareholders' Equity   689,664     594,441     577,377     502,494     435,397  
  Total Liabilities & Shareholders' Equity $    5,810,129   $   5,340,299   $   5,281,295   $   4,769,775   $   4,680,932  
           
Common Shares Outstanding     46,917,735       43,512,179       43,458,973       40,715,938       38,021,835  
           
Note:  The balance sheet at December 31, 2016 has been derived from the audited financial statements at that date. 
 

 

CONSOLIDATED QUARTERLY FINANCIAL  DATA         (Unaudited)          
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES               
                     
  QUARTERS
    2017       2016    
(Dollars in thousands) Fourth   Third   Second   First   Fourth  
                     
Credit Analysis                     
  Net charge-offs (recoveries) - non-acquired loans $    1,475     $   612     $   304     $   211     $   87    
  Net charge-offs (recoveries) - acquired loans     (139 )       (333 )       (405 )       (118 )       141    
  Total net charge-offs (recoveries) $    1,336     $   279     $   (101 )   $   93     $   228    
                     
  TDR valuation adjustments $    37     $   169     $   64     $   49     $   55    
                     
  Net charge-offs (recoveries) to average loans - non-acquired loans   0.16   %   0.07   %   0.04   %   0.03   %   0.01   %
  Net charge-offs (recoveries) to average loans - acquired loans   (0.02 )       (0.04 )       (0.05 )       (0.02 )       0.02    
  Total net charge-offs (recoveries) to average loans   0.14       0.03       (0.01 )     0.01       0.03    
                     
  Loan loss provision (recapture) - non-acquired loans $    2,053     $   795     $   1,690     $   1,504     $   1,161    
  Loan loss provision (recapture) - acquired loans     210         (115 )       (289 )       (200 )       (161 )  
  Total loan loss provision  $    2,263     $   680     $   1,401     $   1,304     $   1,000    
                     
  Allowance for loan losses - non-acquired loans $    26,363     $   25,822     $   25,809     $   24,487     $   23,243    
  Allowance for loan losses - acquired loans     759         410         191         75         157    
  Total allowance for loan losses $    27,122     $   26,232     $   26,000     $   24,562     $   23,400    
                     
  Non-acquired loans at end of period  $    2,922,609     $   2,837,490     $   2,722,866     $   2,572,549     $   2,425,850    
  Purchased noncredit impaired loans at end of period      877,351         537,057         594,077         388,228         440,690    
  Purchased credit impaired loans at end of period     17,417         10,443         13,132         12,982         12,996    
  Total loans $    3,817,377     $   3,384,990     $   3,330,075     $   2,973,759     $   2,879,536    
                     
  Non-acquired loans allowance for loan losses to non-acquired loans at end of period   0.90   %   0.91   %   0.95   %   0.95   %   0.96   %
  Total allowance for loan losses to total loans at end of period    0.71       0.77       0.78       0.83       0.81    
  Acquired loans allowance for loan losses to acquired loans at end of period   0.08       0.07       0.03       0.02       0.03    
  Discount for credit losses to acquired loans at end of period   2.33         2.77         3.37         4.25         4.18    
                     
End of Period                    
  Nonperforming loans - non-acquired loans $    11,088     $   10,877     $   10,541     $   10,557     $   11,023    
  Nonperforming loans - acquired loans     6,955         3,498         6,632         6,428         7,048    
  Other real estate owned - non-acquired     2,246         1,748         1,748         2,790         3,041    
  Other real estate owned - acquired     1,632         1,632         1,645         1,203         1,203    
  Bank branches closed included in other real estate owned     3,762         3,762       5,104       3,892       5,705    
  Total nonperforming assets $    25,683     $   21,517     $   25,670     $   24,870     $   28,020    
                     
  Restructured loans (accruing) $    15,559     $   16,181     $   16,941     $   18,125     $   17,711    
                     
  Nonperforming loans to loans at end of period - non-acquired loans   0.38   %   0.38   %   0.39   %   0.41   %   0.45   %
  Nonperforming loans to loans at end of period - acquired loans   0.78       0.64       1.09       1.60       1.55    
  Allowance for loan losses to nonperforming loans - non-acquired loans    237.76       237.40       244.84       231.95       210.86    
  Total nonperforming loans to loans at end of period   0.47       0.42       0.52       0.57       0.63    
                     
  Nonperforming assets to total assets - non-acquired   0.29   %   0.31   %   0.33   %   0.36   %   0.42   %
  Nonperforming assets to total assets - acquired   0.15         0.10         0.16         0.16         0.18    
  Total nonperforming assets to total assets   0.44       0.40       0.49       0.52       0.60    
                     
Average Balances                    
  Total average assets $    5,716,230     $   5,316,119     $   5,082,002     $   4,699,745     $   4,572,188    
  Less: Intangible assets     149,432         118,364         114,563         78,878         79,620    
  Total average tangible assets $    5,566,798     $   5,197,755     $   4,967,439     $   4,620,867     $   4,492,568    
                     
  Total average equity $    657,100     $   587,919     $   567,448     $   466,847     $   437,077    
  Less: Intangible assets     149,432         118,364         114,563         78,878         79,620    
  Total average tangible equity $    507,668     $   469,555     $   452,885     $   387,969     $   357,457    
                     
  December 31,   September 30,   June 30,   March 31,   December 31,  
LOANS   2017       2017       2017       2017       2016    
                     
Construction and land development $    343,195     $   245,151     $   230,574     $   174,992     $   160,116    
Commercial real estate   1,639,991       1,478,091       1,464,068         1,354,140         1,357,592    
Residential real estate   1,038,740       941,169       991,144       893,674       836,787    
Installment loans to individuals   188,712       184,485       178,595       165,039       153,945    
Commercial and financial   606,015       535,457       465,138       385,189       370,589    
Other loans   724       637       556       725       507    
  Total Loans $    3,817,377     $   3,384,990     $   3,330,075     $   2,973,759     $   2,879,536    
                     
                     

 

CONSOLIDATED QUARTERLY FINANCIAL  DATA         (Unaudited)        
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES                
                     
    December 31,   September 30,   June 30,   March 31,   December 31, 
(Dollars in thousands)   2017     2017     2017     2017     2016
                     
Customer Relationship Funding                   
  Noninterest demand                  
  Commercial $    1,073,539   $   997,749   $   995,720   $   916,940   $   860,449
  Retail     253,454       217,809       238,506       234,109       220,134
  Public funds     50,837       43,686       47,691       52,126       48,690
  Other     22,397       24,874       26,541       21,949       19,036
        1,400,227       1,284,118       1,308,458       1,225,124       1,148,309
                     
  Interest-bearing demand                  
  Commercial   157,272       156,176       155,178       117,629       102,320
  Retail   702,616       670,705       659,906       613,121       591,808
  Public funds   190,867       108,216       119,777       139,707       179,599
        1,050,755       935,097       934,861       870,457       873,727
                     
  Total transaction accounts                  
  Commercial   1,230,811       1,153,925       1,150,898       1,034,569       962,769
  Retail   956,070       888,514       898,412       847,230       811,942
  Public funds   241,704       151,902       167,468       191,833       228,289
  Other   22,397       24,874       26,541       21,949       19,036
        2,450,982       2,219,215       2,243,319       2,095,581       2,022,036
                     
  Savings   434,346       379,499       376,825       363,140       346,662
                     
  Money market                  
  Commercial   375,471       360,567       351,871       313,094       286,879
  Retail   471,086       431,325       427,575       414,886       411,696
  Public funds   84,901       78,896       81,673       93,626       104,122
        931,458       870,788       861,119       821,606       802,697
                     
  Time certificates of deposit   775,934       643,098       494,195       398,318       351,850
  Total Deposits $    4,592,720   $   4,112,600   $   3,975,458   $   3,678,645   $   3,523,245
                     
  Customer sweep accounts $    216,094   $   142,153   $   167,558   $   183,107   $   204,202
                     
  Total core customer funding (1) $    4,032,880   $   3,611,655   $   3,648,821   $   3,463,434   $   3,375,597
                     
                     
(1) Total deposits and customer sweep accounts, excluding certificates of deposits.         
         

 

AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES (1)           (Unaudited)          
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES                       
                                         
    2017         2016  
  Fourth Quarter     Third Quarter     Fourth Quarter  
  Average       Yield/     Average       Yield/     Average       Yield/  
(Dollars in thousands) Balance   Interest   Rate     Balance   Interest   Rate     Balance   Interest   Rate  
Assets                                        
Earning assets:                                        
  Securities:                                        
  Taxable $    1,369,921     $    9,153   2.67 %   $   1,356,276     $   8,823   2.60 %   $   1,251,015     $   6,880   2.20 %
  Nontaxable    31,282       354     4.53       26,256       290     4.42       28,589       441     6.17  
  Total Securities   1,401,203       9,507     2.71       1,382,532       9,113     2.64       1,279,604       7,321     2.29  
                                         
  Federal funds sold and other                                        
  investments   79,025       638   3.20       76,773       664   3.43       90,437       517   2.28  
                                         
  Loans, net   3,691,344       43,375     4.66       3,407,376       40,456     4.71       2,833,895       32,056     4.50  
                                         
  Total Earning Assets   5,171,572       53,520   4.11       4,866,681       50,233   4.10       4,203,936       39,894   3.78  
                                         
Allowance for loan losses   (26,298 )               (26,299 )               (22,819 )          
Cash and due from banks   121,109                 99,864                 90,082            
Premises and equipment   64,121                 57,023                 59,108            
Intangible assets   149,432                 118,364                 79,620            
Bank owned life insurance   123,272                 95,759                 48,954            
Other assets   113,022                 104,727                 113,307            
                                         
  Total Assets $    5,716,230               $   5,316,119               $   4,572,188            
                                         
Liabilities and Shareholders' Equity                                        
Interest-bearing liabilities:                                        
  Interest-bearing demand $    976,295     $    367   0.15 %   $   927,278     $   273   0.12 %   $   812,056     $   149   0.07 %
  Savings   431,124       94   0.09       377,729       52   0.05       343,753       44   0.05  
  Money market   929,914       785   0.33       870,166       605   0.28       824,440       429   0.21  
  Time deposits   761,720       2,032   1.06       548,092       1,266   0.92       360,712       598   0.66  
  Federal funds purchased and                                         
  securities sold under agreements to repurchase   166,006       231   0.55       165,160       204   0.49       184,612       110   0.24  
  Federal Home Loan Bank borrowings   320,380       968   1.20       439,755       1,293   1.17       339,457       392   0.46  
  Other borrowings   70,480       641   3.61       70,409       637   3.59       70,197       544   3.08  
                                         
  Total Interest-Bearing Liabilities   3,655,919       5,118   0.56       3,398,589       4,330   0.51       2,935,227       2,266   0.31  
                                         
Noninterest demand   1,373,403                 1,276,779                 1,167,687            
Other liabilities   29,808                 52,832                 32,197            
  Total Liabilities    5,059,130                 4,728,200                 4,135,111            
                                         
Shareholders' equity   657,100                 587,919                 437,077            
                                         
  Total Liabilities & Equity $    5,716,230               $   5,316,119               $   4,572,188            
                                         
Interest expense as a % of earning assets          0.39 %           0.35 %           0.21 %
Net interest income as a % of earning assets      $    48,402   3.71 %       $   45,903   3.74 %       $   37,628   3.56 %
                                         
                                         
(1) On a fully taxable equivalent basis.  All yields and rates have been computed on an annualized basis using amortized cost.       
     Fees on loans have been included in interest on loans.  Nonaccrual loans are included in loan balances.       
                                         

 

AVERAGE BALANCES, INTEREST INCOME AND EXPENSES, YIELDS AND RATES (1)              (Unaudited)      
SEACOAST BANKING CORPORATION OF FLORIDA AND SUBSIDIARIES                      
                           
    2017       2016  
  Year to Date     Year to Date  
  Average       Yield/     Average       Yield/  
(Dollars in thousands) Balance   Interest   Rate     Balance   Interest   Rate  
Assets                          
Earning assets:                          
  Securities:                          
  Taxable $   1,316,972     $   34,442   2.61 %   $   1,174,627     $   26,133   2.22 %
  Nontaxable    28,369       1,401     4.94       25,841       1,592     6.16  
  Total Securities   1,345,341       35,843     2.66       1,200,468       27,725     2.31  
                           
  Federal funds sold and other                          
  investments   71,352       2,416   3.39       75,442       1,669   2.21  
                           
  Loans, net   3,323,403       154,043     4.64       2,584,389       119,587     4.63  
                           
  Total Earning Assets   4,740,096       192,302   4.06       3,860,299       148,981   3.86  
                           
Allowance for loan losses   (25,485 )               (21,131 )          
Cash and due from banks   106,710                 88,919            
Premises and equipment   59,842                 60,470            
Intangible assets   115,511                 66,611            
Bank owned life insurance   97,939                 45,009            
Other assets   112,004                 101,645            
                           
  Total Assets $   5,206,617               $   4,201,822            
                           
Liabilities and Shareholders' Equity                          
Interest-bearing liabilities:                          
  Interest-bearing demand $   922,353     $   1,065   0.12 %   $   764,917     $   616   0.08 %
  Savings   385,515       241   0.06       325,371       161   0.05  
  Money market   868,427       2,348   0.27       791,998       1,816   0.23  
  Time deposits   523,646       4,678   0.89       351,646       2,074   0.59  
  Federal funds purchased and                           
  securities sold under agreements to repurchase   171,686       782   0.46       187,560       484   0.26  
  Federal Home Loan Bank borrowings   377,396       3,743   0.99       198,268       1,256   0.63  
  Other borrowings   70,377       2,443   3.47       70,097       2,060   2.94  
                           
  Total Interest-Bearing Liabilities   3,319,400       15,300   0.46       2,689,857       8,467   0.31  
                           
Noninterest demand   1,279,825                 1,066,463            
Other liabilities   36,993                 31,628            
  Total Liabilities    4,636,218                 3,787,948            
                           
Shareholders' equity   570,399                 413,874            
                           
  Total Liabilities & Equity $   5,206,617               $   4,201,822            
                           
Interest expense as a % of earning assets          0.32 %           0.22 %
Net interest income as a % of earning assets      $   177,002   3.73 %       $   140,514   3.63 %
                           
                           
(1) On a fully taxable equivalent basis.  All yields and rates have been computed on an annualized basis using amortized cost.     
     Fees on loans have been included in interest on loans.  Nonaccrual loans are included in loan balances.       
                           

 

Explanation of Certain Unaudited Non-GAAP Financial Measures

This presentation contains financial information determined by methods other than Generally Accepted Accounting Principles ("GAAP"). Management uses these non-GAAP financial measures in its analysis of the Company's performance and believes these presentations provide useful supplemental information, and a clearer understanding of the Company's performance. The Company believes the non-GAAP measures enhance investors' understanding of the Company's business and performance and if not provided would be requested by the investor community. These measures are also useful in understanding performance trends and facilitate comparisons with the performance of other financial institutions. The limitations associated with operating measures are the risk that persons might disagree as to the appropriateness of items comprising these measures and that different companies might calculate these measures differently. The Company provides reconciliations between GAAP and these non-GAAP measures. These disclosures should not be considered an alternative to GAAP.

Effective in the first quarter of 2017, adjusted net income and adjusted noninterest expense exclude the effect of amortization of acquisition-related intangibles.  Prior periods have been revised to conform with the current period presentation.

 

                             
  QUARTER   YTD  
(Dollars in thousands except per share data) Fourth   Third   Second   First   Fourth   December 31,   December 31,  
  2017     2017     2017     2017     2016     2017     2016  
  $    13,047   $   14,216   $   7,676   $   7,926   $   10,771   $   42,865   $   29,202  
Net income              
                             
BOLI income (benefits upon death)     0       0       0       0       0       0       (464)  
Gain on Sale of Visa Class B Shares     (15,153)       0       0       0       0       (15,153)       0  
Security (gains) / losses     (112)       47       (21)       0       (7)       (86)       (368)  
  Total Adjustments to Revenue     (15,265)       47       (21)       0       (7)       (15,239)       (832)  
                             
Merger related charges     6,817       491       5,081       533       561       12,922       9,028  
Amortization of intangibles     963       839       839       719       719       3,360       2,486  
Business continuity expenses - Hurricane Irma   0       352       0       0       0       352       0  
Branch reductions and other expense initiatives     0       (127)       1,876       2,572       163       4,321       3,357  
Early redemption cost for FHLB advances     0       0       0       0       0       0       1,777  
  Total Adjustments to Noninterest Expense     7,780       1,555       7,796       3,824       1,443       20,955       16,648  
                             
Effective tax rate on adjustments      3,147       (673)       (2,786)       (1,480)       (404)       (1,792)       (5,949)  
Effect of change in corporate tax rate     8,552       0       0       0       0       8,552       0  
  Adjusted Net Income $    17,261   $   15,145   $   12,665   $   10,270   $   11,803   $   55,341   $   39,069  
Earnings per diluted share, as reported     0.28       0.32       0.18       0.20       0.28       0.99       0.78  
  Adjusted Earnings per Diluted Share      0.37       0.35       0.29       0.26       0.31       1.28       1.04  
Average shares outstanding (000)     46,673       43,792       43,556       39,499       38,252       43,350       37,508  
                             
Revenue $    74,868   $   57,183   $   54,644   $   48,070   $   47,354   $   234,765   $   177,383  
Total Adjustments to Revenue     (15,265)       47       (21)       0       (7)       (15,239)       (832)  
  Adjusted Revenue     59,603       57,230       54,623       48,070       47,347       219,526       176,551  
                             
Noninterest Expense     39,184       34,361       41,625       34,746       30,297       149,916       130,881  
Total Adjustments to Noninterest Expense     7,780       1,555       7,796       3,824       1,443       20,955       16,648  
  Adjusted Noninterest Expense     31,404       32,806       33,829       30,922       28,854       128,961       114,233  
                             
Adjusted Noninterest Expense     31,404       32,806       33,829       30,922       28,854       128,961       114,233  
Foreclosed property expense and net (gain)/loss on sale      (7)       (298)       297       (293)       (78)       (301)       43  
Net Adjusted Noninterest Expense     31,411       33,104       33,532       31,215       28,932       129,262       114,190  
                             
Adjusted Revenue     59,603       57,230       54,623       48,070       47,347       219,526       176,551  
Impact of FTE adjustment     174       154       164       211       204       703       204  
Adjusted Revenue on a fully taxable equivalent basis     59,777       57,384       54,787       48,281       47,551       220,229       176,755  
  Adjusted Efficiency Ratio   52.6 %   57.7 %   61.2 %   64.7 %   60.8 %   58.7 %   64.6 %
                             
Average Assets $   5,716,230   $   5,316,119   $   5,082,002   $   4,699,745   $   4,572,188   $   5,206,617   $   4,201,819  
Less average goodwill and intangible assets     (149,432)       (118,364)       (114,563)       (78,878)       (79,620)       (115,511)       (66,608)  
Average Tangible Assets     5,566,798       5,197,755       4,967,439       4,620,867       4,492,568       5,091,106       4,135,211  
                             
Return on Average Assets (ROA)   0.91 %   1.06 %   0.61 %   0.68 %   0.94 %   0.82 %   0.69 %
Impact of removing average intangible assets and related amortization    0.06     0.06     0.05     0.06     0.06     0.06     0.05  
  Return on Tangible Average Assets (ROTA)   0.97     1.12     0.66     0.74     1.00     0.88     0.74  
Impact of other adjustments for Adjusted Net Income    0.26     0.04     0.36     0.16     0.05     0.21     0.20  
  Adjusted Return on Average Tangible Assets   1.23     1.16     1.02     0.90     1.05     1.09     0.94  
                             
Average Shareholders' Equity $    657,100   $   587,919   $   567,448   $   466,847   $   437,077   $   570,399   $   406,084  
Less average goodwill and intangible assets     (149,432)       (118,364)       (114,563)       (78,878)       (79,620)       (115,511)       (66,608)  
Average Tangible Equity     507,668       469,555       452,885       387,969       357,457       454,888       339,476  
                             
Return on Average Shareholders' Equity    7.9 %   9.6 %   5.4 %   6.9 %   9.8 %   7.5 %   7.2 %
Impact of removing average intangible assets and related amortization    2.8     2.9     1.9     1.9     2.7     2.4     1.9  
  Return on Average Tangible Common Equity (ROTCE)   10.7     12.5     7.3     8.8     12.5     9.9     9.1  
Impact of other adjustments for Adjusted Net Income    2.8     0.3     3.9     1.9     0.6     2.3     2.4  
  Adjusted Return on Average Tangible Common Equity    13.5     12.8     11.2     10.7     13.1     12.2     11.5  
                             

Please visit Seacoast Bank's website for a PDF version of this press release and information on the 4th Quarter 2017 Earnings Conference Call: http://www.seacoastbanking.com/presentations.aspx?iid=100425

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