Market Overview

PCSB Financial Corporation Announces Fourth Quarter Results and Declares Quarterly Cash Dividend

Share:

YORKTOWN HEIGHTS, N.Y., Aug. 02, 2018 (GLOBE NEWSWIRE) -- PCSB Financial Corporation (the "Company") (NASDAQ:PCSB), parent of PCSB Bank (the "Bank"), today announced net income of $2.7 million, or $0.16 per basic and diluted share, for the three months ended June 30, 2018 compared to $2.2 million, or $0.13 per basic and diluted share, for the three months ended March 31, 2018 and a loss of $1.8 million for the three months ended June 30, 2017. For the year ended June 30, 2018, net income was $6.6 million, or $0.39 per basic and diluted share, compared to $3.2 million for the year ended June 30, 2017.

The following nonrecurring items were recorded in the current quarter:

  • Interest income of $879,000 recorded upon the pay-off of two nonaccrual loans
  • A $370,000 loss on a receivable
  • A $63,000 gain on sale of securities

On a non-GAAP basis, which excludes certain nonrecurring items, including those discussed above, the Company recorded net income of $2.2 million and $7.6 million for the three months and year ended June 30, 2018, or $0.13 and $0.46 per diluted share, respectively. This compares to non-GAAP net income of $1.5 million and $5.2 million for the three months and year ended June 30, 2017, respectively. Reconciliations of GAAP to non-GAAP measures appear at the end of this release.

Effective April 20, 2017, PCSB Bank completed its mutual-to-stock conversion and the Company completed its related initial public offering. Accordingly, financial results for dates and periods prior to April 20, 2017 are for the Bank only.

President's Comments
Commenting on the Company's results, Joseph D. Roberto, Chairman, President and Chief Executive Officer of PCSB Financial Corporation, said "I am proud of the Company's progress and successful achievements as we completed our first full year as a public company.  Some of these accomplishments include fourth quarter net income of $2.7 million, the highest quarterly income in the Company's history, a $92.7 million, or 11.4%, year-over-year increase in net loans and a 16.7% increase in net interest income.  Problem assets continue to decline as the ratio of non-performing assets to total assets fell by more than half to 0.44% from 0.91% a year ago.  Additionally, as the Federal Reserve increased the Fed Funds Rate by 1.75%, the Bank's average cost of funds, at 0.55%, increased minimally year-over-year.  As we head into fiscal year 2019, we hope to build on these results by continuing to grow the balance sheet with loans while maintaining high credit quality standards.  I am also pleased to announce that our Board of Directors approved our second quarterly cash dividend of $0.03 per share."

Income Statement Summary
Net interest income increased $2.0 million, or 21.6%, to $11.4 million for the three months ended June 30, 2018, compared to the same period in 2017 and increased $1.3 million or 12.7% from the previous quarter.  The increase in net interest income compared to the prior year is a result of a $44.2 million increase in average net interest earning assets and a 43-basis point increase in the net interest margin. The increase in net interest earning assets is due primarily to the deployment of the capital raised in the initial public offering into loans receivable and investments. The net interest margin was 3.23% for the three months ended June 30, 2018, an increase from 2.80% for the three months ended June 30, 2017 and 2.99% for the three months ended March 31, 2018. Included in current quarter net interest income is $879,000 of interest income recorded from the pay-off of two nonaccrual loans. Excluding this interest, net interest margin for the quarter would have been 2.98%, an increase of 18 basis points from the prior year and a decrease of 1 basis point from the prior quarter.

The provision for loan losses was $25,000 for the three months June 30, 2018 compared to no provision expense for the same period in 2017. The provision for loan losses decreased $29,000 compared to prior quarter due primarily to recoveries realized in the current quarter.  Recoveries, net of charge-offs, were $255,000 for the three months ended June 30, 2018 compared to $99,000 for the three months ended March 31, 2018 and $320,000 for the three months ended June 30, 2017.  Loans classified as substandard and doubtful decreased $4.2 million, or 21.4%, to $15.4 million at June 30, 2018 from $19.6 million at March 31, 2018 and decreased $9.7 million, or 38.8%, from $25.1 million at June 30, 2017. Non-performing loans were 0.66% of total loans receivable as of June 30, 2018, down from 0.80% as of March 31, 2018 and 1.48% as of June 30, 2017.

Noninterest income decreased $46,000 to $601,000 for the three months ended June 30, 2018 compared to the same period in 2017, due primarily to $142,000 of gains on the sale of foreclosed real estate recorded in the quarter ended June 30, 2017, partially offset by $63,000 of gains on the sale of securities recorded in the current quarter and a $45,000 increase in deposit-related fee income. Noninterest income increased $89,000 from the three months ended March 31, 2018, due primarily to $63,000 of gains on the sale of securities realized in the current quarter.

Noninterest expense decreased $4.6 million to $8.3 million for the three months ended June 30, 2018 compared to the same period in 2017 and increased $431,000 compared to the three months ended March 31, 2018. The $4.6 million decrease was caused primarily by a $5.0 million contribution expense recognized in the prior year related to the establishment of the PCSB Community Foundation, partially offset by a $370,000 loss recorded on a receivable in the current quarter. All other operating expenses were largely unchanged compared to the prior year quarter as increases in salaries and employee benefits, as well as increases in Director and Officer insurance expense and other professional fees associated with being a public company, were primarily offset by lower FDIC assessments, advertising costs and expenses on foreclosed real estate.  The $431,000 increase in noninterest expense from the three months ended March 31, 2018 was due primarily to a $370,000 loss recorded on a receivable in the current quarter.                                                                                     

Income tax expense was $1.1 million for the three months ended June 30, 2018 compared to an income tax benefit of $1.0 million for the same period in 2017. The effective income tax rate was 28.7% for the three months ended June 30, 2018 as compared to 36.2% for the three months ended June 30, 2017. Income tax expense increased $484,000 compared to the three months ended March 31, 2018 due primarily to higher net income before income tax expense, partially offset by a $182,000 deferred tax re-measurement benefit recorded in the prior quarter.

Balance Sheet Summary
Total assets increased $53.7 million to $1.48 billion at June 30, 2018 from $1.43 billion at June 30, 2017.  This increase was due primarily to an increase of $92.7 million, or 11.4%, in net loans receivable, partially offset by a decrease of $36.8 million in total investment securities. The $92.7 million increase in net loans included increases of $57.6 million in commercial mortgage loans, $32.8 million in residential mortgage loans, and $11.0 million in commercial loans, partially offset by decreases of $5.1 million in construction loans and $4.5 million in home equity lines of credit. Loan growth was funded by a decrease in investment securities as well as an increase in deposits.

Total liabilities increased $46.0 million to $1.19 billion at June 30, 2018 from $1.15 billion at June 30, 2017.  This increase was due primarily to a $69.0 million increase in deposits, partially offset by a $23.8 million decrease in advances from FHLB. 

Total shareholders' equity increased $7.8 million to $287.6 million at June 30, 2018 from $279.8 million at June 30, 2017.  This increase was due primarily to net income of $6.6 million and a $2.2 million reduction in unearned ESOP shares for plan shares earned during the period, partially offset by other comprehensive losses of $618,000 due largely to increased unrealized losses in the available for sale investment securities portfolio driven by increased market interest rates, as well as $504,000 of cash dividends paid.  At June 30, 2018, the Company's book value per share and tangible book value per share were $15.83 and $15.47, respectively, compared to $15.41 and $15.04, respectively, at June 30, 2017.  Reconciliations of book value per share (GAAP measure) to tangible book value per share (non-GAAP measure) appear at the end of this release. At June 30, 2018, the Bank was considered "well capitalized" under applicable regulatory guidelines.

Dividend
The Board of Directors has declared a regular quarterly cash dividend of $0.03 per share. The dividend is payable on or about August 31, 2018 to stockholders of record on August 17, 2018.

Equity Incentive Plan
The Company has sought and received the New York State Department of Financial Services' requisite non-objection to its proposed 2018 Equity Incentive Plan and will seek stockholder approval of the Plan at its 2018 Annual Meeting of Stockholders scheduled for October 24, 2018.

About PCSB Financial Corporation and PCSB Bank
PCSB Financial Corporation is the bank holding company for PCSB Bank. PCSB Bank is a New York-chartered stock savings bank and has served the banking needs of its customers in the Lower Hudson Valley of New York State since 1871. It operates from its executive offices/headquarters and 15 branch offices located in Dutchess, Putnam, Rockland and Westchester Counties in New York.

This News Release contains a number of forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements may be identified by use of words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "outlook," "plan," "potential," "predict," "project," "should," "will," "would" and similar terms and phrases, including references to assumptions.

Forward-looking statements are based upon various assumptions and analyses made by the Company in light of management's experience and its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate under the circumstances. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors (many of which are beyond the Company's control) that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. These factors include, without limitation, the following: the timing and occurrence or non-occurrence of events may be subject to circumstances beyond the Company's control; there may be increases in competitive pressure among financial institutions or from non-financial institutions; changes in the interest rate environment may reduce interest margins; changes in deposit flows, loan demand or real estate values may adversely affect the Company's business; changes in accounting principles, policies or guidelines may cause the Company's financial condition to be perceived differently; changes in corporate and/or individual income tax laws may adversely affect the Company's financial condition or results of operations; general economic conditions, either nationally or locally in some or all areas in which the Company conducts business, or conditions in the securities markets or the banking industry may be less favorable than the Company currently anticipates; legislation or regulatory changes may adversely affect the Company's business; technological changes may be more difficult or expensive than the Company anticipates; success or consummation of new business initiatives may be more difficult or expensive than the Company anticipates; or litigation or other matters before regulatory agencies, whether currently existing or commencing in the future, may delay the occurrence or non-occurrence of events longer than the Company anticipates. The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation.

Contact: Joseph D. Roberto
Chairman, President and Chief Executive Officer
(914) 248-7272

PCSB Financial Corporation and Subsidiaries
Consolidated Balance Sheets (unaudited)
(amounts in thousands, except share data)

           
      June 30,   June 30,
      2018   2017
ASSETS              
Cash and due from banks     $ 60,684   $ 59,115
Federal funds sold       1,461     1,371
Cash and cash equivalents       62,145     60,486
Investment Securities:              
Held to maturity investment securities, at amortized cost       353,183     383,551
(fair value of $343,188 and $383,588, respectively)  
Available for sale securities, at fair value       105,504     111,889
Total investment securities       458,687     495,440
Loans receivable, net of allowance for loan losses of $4,904 and $5,150, respectively     902,336     809,648
Accrued interest receivable       4,358     3,693
Federal Home Loan Bank stock       2,050     3,132
Premises and equipment, net       11,598     12,959
Deferred tax asset, net       2,622     4,770
Foreclosed real estate       460     977
Bank-owned life insurance       23,747     23,179
Goodwill       6,106     6,106
Other intangible assets       433     559
Other assets       5,645     5,509
Total assets     $ 1,480,187   $ 1,426,458
LIABILITIES AND SHAREHOLDERS' EQUITY              
Interest bearing deposits     $ 1,025,574   $ 952,109
Non-interest bearing deposits       131,883     136,352
Total deposits       1,157,457     1,088,461
Mortgage escrow funds       8,803     8,084
Advances from Federal Home Loan Bank       18,841     42,598
Other liabilities       7,527     7,469
Total liabilities       1,192,628     1,146,612
Commitments and contingencies       -     -
Preferred stock ($0.01 par value, 10,000,000 shares authorized, no shares issued or outstanding as of June 30, 2018 and June 30, 2017, respectively)     -     -
Common stock ($0.01 par value, 200,000,000 shares authorized, 18,165,110 shares issued and outstanding as of June 30, 2018 and June 30, 2017, respectively)     182     182
Additional paid in capital       179,045     177,993
Retained earnings       128,365     121,148
Unallocated common stock of Employee Stock Ownership Plan ("ESOP")       (13,083)     (14,262)
Accumulated other comprehensive loss, net of income taxes       (6,950)     (5,215)
Total shareholders' equity       287,559     279,846
Total liabilities and shareholders' equity     $ 1,480,187   $ 1,426,458
 
 

PCSB Financial Corporation and Subsidiaries
Consolidated Statements of Operations (unaudited)
(amounts in thousands, except share and per share data)

           
      Three Months Ended   Year Ended
      June 30,   June 30,
      2018     2017   2018   2017
Interest and dividend income                            
Loans receivable     $ 10,706     $ 8,408   $ 37,798   $ 33,664
Investment securities       2,384       2,018     9,266     6,661
Federal funds and other       268       297     896     633
Total interest and dividend income       13,358       10,723     47,960     40,958
Interest expense                            
Deposits       1,600       1,244     5,554     5,083
FHLB advances       326       74     769     210
Total interest expense       1,926       1,318     6,323     5,293
Net interest income       11,432       9,405     41,637     35,665
Provision for loan losses       25       -     414     823
Net interest income after provision for loan losses     11,407       9,405     41,223     34,842
Noninterest income                            
Fees and service charges       260       223     1,070     1,178
Gains on sales of securities, net       63       -     236     -
Bank-owned life insurance       138       149     568     622
Settlement on acquired loan       -       -           1,615
Other       140       275     645     669
Total noninterest income       601       647     2,519     4,084
Noninterest expense                            
Salaries and employee benefits       4,844       4,712     19,235     16,901
Occupancy and equipment       1,289       1,367     5,193     5,864
Charitable foundation contribution       -       5,000     -     5,000
Professional fees       452       450     1,709     1,308
Advertising       -       165     456     529
Postage, printing, stationary and supplies       143       143     578     547
FDIC assessment       93       77     328     558
Amortization of intangible assets       29       34     126     143
Other operating expenses       1,414       911     4,491     3,581
Total noninterest expense       8,264       12,859     32,116     34,431
Net income (loss) before income tax expense       3,744       (2,807)     11,626     4,495
Income tax expense (benefit)       1,075       (1,017)     5,022     1,266
Net income (loss)     $ 2,669     $ (1,790)   $ 6,604   $ 3,229
                             
Earnings per common share:                            
Basic     $ 0.16     n/a   $ 0.39   n/a
Diluted     $ 0.16     n/a   $ 0.39   n/a
                             
Weighted average common share - basic and diluted     16,844,747     n/a     16,802,894   n/a
                         
                         

PCSB Financial Corporation and Subsidiaries
Net Interest Margin Analysis (unaudited)
(dollar amounts in thousands)

                                     
    Three months ended June 30,
    2018     2017
    Average Balance   Interest / Dividends   Average Rate     Average Balance   Interest / Dividends   Average Rate
     
Assets:                                    
Loans receivable   $ 900,998   $ 10,706     4.75%     $ 782,658   $ 8,408   4.3%
Investment securities     465,206     2,384     2.05       447,826     2,018   1.8
Other interest-earning assets     51,605     268     2.09       111,821     297   1.07
Total interest-earning assets     1,417,809     13,358     3.77       1,342,305     10,723   3.20
Non-interest-earning assets     57,004                   84,528          
Total assets   $ 1,474,813                 $ 1,426,833          
                                     
Liabilities and equity:                                    
NOW accounts   $ 115,711     51     0.18     $ 148,361     53   0.15
Money market accounts     46,104     70     0.61       30,067     20   0.26
Savings accounts and escrow     484,463     293     0.24       521,739     319   0.24
Time deposits     343,027     1,186     1.39       298,694     852   1.14
Total interest-bearing deposits     989,305     1,600     0.65       998,861     1,244   0.51
Federal Home Loan Bank advances     66,740     326     1.96       25,895     74   1.16
Total interest-bearing liabilities     1,056,045     1,926     0.73       1,024,756     1,318   0.52
Non-interest-bearing deposits     125,898                   126,987          
Other non-interest-bearing liabilities     6,671                   8,929          
Total liabilities     1,188,614                   1,160,672          
Total shareholders' equity     286,199                   266,161          
Total liabilities and shareholders' equity  $ 1,474,813                 $ 1,426,833          
                                     
                                     
Net interest income         $ 11,432                 $ 9,405    
Interest rate spread (1)                 3.04                 2.68
Net interest margin (2)                 3.23                 2.80
Average interest-earning assets to interest-bearing liabilities   134.26%                   130.99%          
                                     
(1) Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.
(2) Net interest margin represents annualized net interest income divided by average interest-earning assets.
 
 

PCSB Financial Corporation and Subsidiaries
Net Interest Margin Analysis (unaudited)
(dollar amounts in thousands)

 
  Year ended June 30,
  2018   2017
  Average Balance   Interest / Dividends   Average Rate   Average Balance   Interest / Dividends   Average Rate
   
Assets:                                  
Loans receivable $ 846,353   $ 37,798     4.47%   $ 773,590   $ 33,664     4.35%
Investment securities   474,201     9,266     1.95     389,910     6,661     1.71
Other interest-earning assets   54,528     896     1.64     74,149     633     0.85
Total interest-earning assets   1,375,082     47,960     3.49     1,237,649     40,958     3.31
Non-interest-earning assets   57,696                 64,935            
Total assets $ 1,432,778               $ 1,302,584            
                                   
Liabilities and equity:                                  
NOW accounts $ 113,952     197     0.17   $ 125,818     195     0.16
Money market accounts   36,917     163     0.44     31,260     83     0.26
Savings accounts and escrow   502,310     1,223     0.24     525,486     1,289     0.25
Time deposits   315,652     3,971     1.26     313,334     3,516     1.12
Total interest-bearing deposits   968,831     5,554     0.57     995,898     5,083     0.52
Federal Home Loan Bank advances   42,719     769     1.8     15,911     210     1.32
Total interest-bearing liabilities   1,011,550     6,323     0.63     1,011,809     5,293     0.52
Non-interest-bearing deposits   130,196                 126,666            
Other non-interest-bearing liabilities   7,360                 13,083            
Total liabilities   1,149,106                 1,151,558            
Total shareholders' equity   283,672                 151,026            
Total liabilities and shareholders' equity $ 1,432,778               $ 1,302,584            
                                   
                                   
Net interest income       $ 41,637               $ 35,665      
Interest rate spread (1)               2.86                 2.79
Net interest margin (2)               3.03                 2.88
Average interest-earning assets to interest-bearing liabilities   135.94%                 122.32%            
 
(1) Net interest rate spread represents the difference between the average yield on average interest-earning assets and the average cost of average interest-bearing liabilities.
(2) Net interest margin represents annualized net interest income divided by average interest-earning assets.
 
 

PCSB Financial Corporation and Subsidiaries
Condensed Financial Information (unaudited)
(amounts in thousands, except per share data)

   
  As of
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
                             
Condensed Balance Sheets                            
Cash and cash equivalents $ 62,145   $ 36,505   $ 77,106   $ 34,733   $ 60,486
Total investment securities   458,687     473,683     470,360     475,823     495,440
Loans receivable, net   902,336     886,718     838,120     839,963     809,648
Other assets   57,019     60,063     57,682     61,187     60,884
Total assets $ 1,480,187   $ 1,456,969   $ 1,443,268   $ 1,411,706   $ 1,426,458
                             
Total deposits and escrow $ 1,166,260   $ 1,095,581   $ 1,122,558   $ 1,086,662   $ 1,096,545
Advances from Federal Home Loan Bank   18,841     68,872     30,720     35,750     42,598
Other liabilities   7,527     7,856     7,579     7,209     7,469
Total liabilities   1,192,628     1,172,309     1,160,857     1,129,621     1,146,612
Total shareholders' equity   287,559     284,660     282,411     282,085     279,846
Total liabilities and shareholders' equity $ 1,480,187   $ 1,456,969   $ 1,443,268   $ 1,411,706   $ 1,426,458
                             


 
  Quarter Ended   Year Ended
  June 30,   March 31,   December 31,   September 30,   June 30,   June 30,   June 30,
2018 2018 2017 2017 2017 2018 2017
Condensed Income Statements                                        
Interest income $ 13,358   $ 11,648   $ 11,657   $ 11,297   $ 10,723   $ 47,960   $ 40,958
Interest expense   1,926     1,505     1,471     1,421     1,318     6,323     5,293
Net interest income   11,432     10,143     10,186     9,876     9,405     41,637     35,665
Provision for loan losses   25     54     200     135     -     414     823
Noninterest income   601     512     692     714     647     2,519     4,084
Noninterest expense   8,264     7,833     8,125     7,894     12,859     32,116     34,431
Income before income tax expense (benefit)   3,744     2,768     2,553     2,561     (2,807 )   11,626     4,495
Income tax expense (benefit)   1,075     591     2,551     805     (1,017 )   5,022     1,266
Net income (loss) $ 2,669   $ 2,177   $ 2   $ 1,756   $ (1,790 ) $ 6,604   $ 3,229
                                         
Earnings per share:                                        
Basic $ 0.16   $ 0.13   $ 0.00   $ 0.10   n/a   $ 0.39   n/a
Diluted $ 0.16   $ 0.13   $ 0.00   $ 0.10   n/a   $ 0.39   n/a
                                     
                                     

PCSB Financial Corporation and Subsidiaries
Selected Financial Data (unaudited)

         
    Quarter Ended   Year Ended
    June 30,   March 31,   December 31,   September 30,   June 30,   June 30,   June 30,
  2018 2018 2017 2017 2017 2018 2017
Performance Ratios (1):                                          
Return on average assets     0.72%     0.62%     0.00%     0.49%     (0.50%)     0.46%     0.25%
Return on average equity     3.73%     3.06%     0.00%     2.44%     (2.69%)     2.33%     2.14%
Interest rate spread     3.04%     2.82%     2.85%     2.74%     2.69%     2.86%     2.79%
Net interest margin     3.23%     2.99%     3%     2.89%     2.81%     3.03%     2.88%
Adjusted Efficiency ratio (2)     71.17%     73.51%     74.69%     75.78%     78.18%     73.54%     78.22%
                                           
Noninterest income to average assets     0.16%     0.14%     0.20%     0.20%     0.18%     0.18%     0.31%
Noninterest expense to average assets     2.24%     2.21%     2.3%     2.2%     3.6%     2.24%     2.64%
                                           
Average interest-earning assets to average interest-bearing liabilities   134.26%     136.59%     136.51%     136.5%     130.71%     135.94%     122.32%
Average equity to average assets     19.41%     20.08%     20.00%     20.10%     18.65%     19.80%     11.59%
                                           
                                           

PCSB Financial Corporation and Subsidiaries
Selected Financial Data (unaudited) - Continued
(dollar amounts in thousands, except share and per share data)

   
  As of or for the quarter ended
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
                                 
Loans to deposits       77.96%     81.5%     75.21%     77.65%     74.38%
                                 
Share Data:                                
Shares outstanding       18,165,110     18,165,110     18,165,110     18,165,110     18,165,110
Book value per common share     $ 15.83   $ 15.67   $ 15.55   $ 15.53   $ 15.41
Tangible book value per common share (3)     $ 15.47   $ 15.31   $ 15.18   $ 15.16   $ 15.04
                                 
Asset Quality Ratios:                                
Non-performing assets     $ 6,462   $ 7,307   $ 8,191   $ 12,354   $ 13,049
Allowance for loan losses as a percent of total loans receivable       0.54%     0.52%     0.53%     0.62%     0.63%
Allowance for loan losses as a percent of non-performing loans       81.71%     64.54%     54.58%     48.53%     42.66%
Non-performing loans as a percent of total loans receivable, net       0.66%     0.80%     0.97%     1.35%     1.48%
Non-performing assets as a percent of total assets       0.44%     0.5%     0.57%     0.88%     0.91%
                                 
Net charge-offs (recoveries)     $ (255)   $ (99)   $ 997   $ 17   $ (320)
Net charge-offs (recoveries) to average outstanding loans during the period (1)       (0.11%)     (0.05%)     0.48%     0.01%     (0.16%)
                                 
Capital Ratios (4):                                
Tier 1 capital (to adjusted total assets)       13.61%     13.97%     13.84%     13.52%     13.65%
Common equity Tier 1 capital (to risk-weighted assets)       21.11%     21.16%     21.64%     21.13%     21.69%
Tier 1 capital (to risk-weighted assets)       21.11%     21.16%     21.64%     21.13%     21.69%
Total capital (to risk-weighted assets)       21.62%     21.65%     22.13%     21.71%     22.27%
                                 
(1) Performance ratios are annualized.
(2) Adjusted efficiency ratio is a non-GAAP measure and is defined as noninterest expense, less certain nonrecurring items, divided by operating revenue, which is equal to net interest income plus non-interest income excluding certain nonrecurring items. In our judgment, the adjustments made to operating revenue allow investors and analysts to better assess our operating expenses in relation to our core operating revenue by removing the impact of certain one-time items and other discrete items that are unrelated to our core business.
(3) Tangible book value per share is a non-GAAP measure and equals total shareholders' equity, less goodwill and other intangible assets, divided by shares outstanding.  We believe this disclosure may be meaningful to those investors who seek to evaluate our equity without giving effect to goodwill and other intangible assets.
(4) Represents Bank ratios.
 
 

PCSB Financial Corporation and Subsidiaries
Loan and Deposit Portfolio (unaudited)
(amounts in thousands)

   
  As of
  June 30,   March 31,   December 31,   September 30,   June 30,
  2018   2018   2017   2017   2017
Mortgage loans:                            
Residential mortgages $ 250,578   $ 253,847   $ 213,716   $ 215,551   $ 217,778
Commercial mortgage   495,265     484,810     481,169     469,983     437,651
Construction   17,352     16,098     16,379     23,104     22,404
Net deferred loan origination costs   1,041     1,203     210     384     397
    764,236     755,958     711,474     709,022     678,230
Commercial and consumer loans:                            
Commercial loans   104,135     96,096     89,941     93,180     93,631
Home equity credit lines   37,395     38,220     40,158     42,044     41,927
Consumer and overdrafts   745     344     251     213     233
Net deferred loan origination costs   729     724     767     772     777
    143,004     135,384     131,117     136,209     136,568
Total loans receivable   907,240     891,342     842,591     845,231     814,798
Allowance for loan loss   (4,904)     (4,624)     (4,471)     (5,268)     (5,150)
Loans receivable, net $ 902,336   $ 886,718   $ 838,120   $ 839,963   $ 809,648
                             
 
  As of
  June 30,   March 31,   December 31,   September 30,   June 30,
  2018   2018   2017   2017   2017
                             
Demand deposits $ 131,883   $ 127,319   $ 150,830   $ 133,461   $ 136,361
Now accounts   117,875     114,899     118,462     110,646     115,527
Money market accounts   49,885     40,374     31,021     28,590     29,097
Savings   465,441     482,968     502,469     504,291     512,697
Time deposits   392,373     322,425     311,547     304,719     294,779
Total deposits $ 1,157,457   $ 1,087,985   $ 1,114,329   $ 1,081,707   $ 1,088,461
                             
                             

PCSB Financial Corporation and Subsidiaries
Reconciliation of GAAP to Non-GAAP Measures (unaudited)
(dollar amounts in thousands, except share and per share data)

                 
            Three Months Ended   Year Ended
            June 30,   June 30,
            2018   2017   2018   2017
Computation of Adjusted Net Income and Earnings Per Share
                           
Net income (loss)           $ 2,669   $ (1,790)   $ 6,604   $ 3,229
Adjustments (1):                                
Losses on other receivables             292     -     424     -
Nonaccrual loan interest earned             (694)     -     (788)     -
Gain on sale of securities             (49)     -     (163)     -
Deferred tax re-measurement charge             -     -     1,570     -
Charitable foundation contribution             -     3,300     -     3,300
Defined benefit pension plan curtailment             -     -     -     (607)
Write-down of operating lease obligation             -     -     -     344
Settlement on acquired loan             -     -     -     (1,066)
Adjusted net income           $ 2,218   $ 1,510   $ 7,647   $ 5,200
                                 
Average number of common shares outstanding used to calculate basic earnings per common share     16,844,747   n/a     16,802,894   n/a
                                 
Adjusted earnings per common share (basic and diluted):         $ 0.13   n/a   $ 0.46   n/a
                                 
Computation of Adjusted Effective Tax Rate                                
Net income (loss) before income tax expense           $ 3,744   $ (2,807)   $ 11,626   $ 4,495
                                 
Income tax expense (benefit)             1,075     (1,017)     5,022     1,266
Adjustments:                                
Deferred tax re-measurement charge             -     -     (1,570)     -
Adjusted income tax expense (benefit)           $ 1,075   $ (1,017)   $ 3,452   $ 1,266
                                 
Effective tax rate             28.7%     36.2%     43.2%     28.2%
Adjusted effective tax rate             28.7%     36.2%     29.7%     28.2%
                                 
(1) Amounts included in income before income tax expense are presented net of tax.
 
 

PCSB Financial Corporation and Subsidiaries
Reconciliation of GAAP to Non-GAAP Measures (unaudited) - Continued
(dollar amounts in thousands, except share and per share data)

       
  Quarter Ended   Year Ended
  June 30,   March 31,   December 31,   September 30,   June 30,   June 30,   June 30,
2018 2018 2017 2017 2017 2018 2017
Computation of Efficiency Ratio                                        
Noninterest expense $ 8,264   $ 7,833   $ 8,125   $ 7,894   $ 12,859   $ 32,116   $ 34,431
Adjustments:                                        
Losses on other receivables   (370)     -     (200)     -     -     (570)     -
PCSB Community Foundation contribution   -     -     -     -     (5,000)     -     (5,000)
Defined benefit pension plan curtailment   -     -     -     -     -     -     919
Write-down of operating lease obligation   -     -     -     -     -     -     (521)
Adjusted noninterest expense $ 7,894   $ 7,833   $ 7,925   $ 7,894   $ 7,859   $ 31,546   $ 29,829
                                         
Net interest income $ 11,432   $ 10,143   $ 10,186   $ 9,876   $ 9,405   $ 41,637   $ 35,665
Noninterest income   601     512     692     714     647     2,519     4,084
Total revenue   12,033     10,655     10,878     10,590     10,052     44,156     39,749
Adjustments:                                        
Nonaccrual loan interest earned   (879)     -     (142)     -     -     (1,021)     -
Gain on sale of securities   (63)     -     -     (173)     -     (236)     -
Settlement on acquired loan   -     -     -     -     -     -     (1,615)
Adjusted operating revenue $ 11,091   $ 10,655   $ 10,736   $ 10,417   $ 10,052   $ 42,899   $ 38,134
                                         
Efficiency ratio   68.68%     73.51%     74.69%     74.54%     127.92%     72.73%     86.62%
Adjusted efficiency ratio   71.17%     73.51%     73.82%     75.78%     78.18%     73.54%     78.22%
                                         
                                         

PCSB Financial Corporation and Subsidiaries
Reconciliation of GAAP to Non-GAAP Measures (unaudited) - Continued
(dollar amounts in thousands, except share and per share data)

  As of
  June 30,   March 31,   December 31,   September 30,   June 30,
2018 2018 2017 2017 2017
Computation of Tangible Book Value per Common Share                            
Total shareholders' equity $ 287,559   $ 284,660   $ 282,411   $ 282,085   $ 279,846
Adjustments:                            
Preferred stock   -     -     -     -     -
Common shareholders' equity   287,559     284,660     282,411     282,085     279,846
Adjustments:                            
Goodwill   (6,106)     (6,106)     (6,106)     (6,106)     (6,106)
Other intangible assets   (433)     (463)     (495)     (527)     (559)
Tangible common shareholders' equity $ 281,020   $ 278,091   $ 275,810   $ 275,452   $ 273,181
                             
Common shares outstanding   18,165,110     18,165,110     18,165,110     18,165,110     18,165,110
                             
Book value per share $ 15.83   $ 15.67   $ 15.55   $ 15.53   $ 15.41
Adjustments:                            
Effects of intangible assets   (0.36)     (0.36)     (0.37)     (0.37)     (0.37)
                             
Tangible book value per common share $ 15.47   $ 15.31   $ 15.18   $ 15.16   $ 15.04
                             

Primary Logo

View Comments and Join the Discussion!