Market Overview

Carolina Trust BancShares, Inc. Reports 3rd Quarter 2019 Results

Share:
  • $0.15 Net Income Per Diluted Share for the third quarter of 2019 as compared to $0.13 for the third quarter of 2018
  • Adjusted Net Income Per Diluted Share excluding merger expenses, accretion of loan and deposit fair market value adjustments, and amortization of core deposit intangibles, was $0.21 for the third quarter of 2019 as compared to $0.15 for the third quarter of 2018 (a non-GAAP measure)

LINCOLNTON, N.C., Oct. 31, 2019 (GLOBE NEWSWIRE) -- Carolina Trust BancShares, Inc. (the "Company") (NASDAQ - CART) reports its financial results today for the most recently completed  quarter.  For the quarter ended September 30, 2019 ("3Q19"), the Company's net income was $1,427,000 or $0.15 per diluted share as compared to $915,000 or $0.13 per diluted share for the quarter ended September 30, 2018 ("3Q18"), an increase of $512,000 or $0.02 per diluted share.  The diluted average common shares outstanding increased to 9.4 million shares in 3Q19 from 7.2 million shares in 3Q18, due to the issuance of shares in connection with the acquisition of Clover Community Bankshares, Inc., ("Clover") and its subsidiary bank, Clover Community Bank, on January 1, 2019.

The Company recognized expenses in each period that were related to its acquisition of Clover.  The Company also recognized 3Q19 expenses that were related to its pending merger with Carolina Financial Corporation ("CARO") and the pending merger of Carolina Trust Bank with CresCom Bank, CARO's subsidiary bank.  These items, net of tax, reduced income by $582,000 in 3Q19, primarily due to the pending merger with CARO, and by $147,000 in 3Q18, due to the Clover acquisition.  A special shareholder meeting is scheduled on December 18, 2019 to vote on the merger with CARO.  Definitive proxy materials were mailed to the Company's shareholders commencing on October 28, 2019.

Adjusted net income, which excludes these merger-related items and is a non-GAAP (Generally Accepted Accounting Principles) measure, was $2,009,000 in 3Q19 and $1,062,000 in 3Q18.  On a diluted per share basis, adjusted net income per share was $0.21 in 3Q19 and $0.15 in 3Q18.  See the non-GAAP reconciliation table that accompanies this release for additional information.

For the linked quarter ended June 30, 2019, net income was $1,818,000 or $0.19 per diluted share and adjusted net income was $1,861,000 or $0.20 per diluted share.

The table below summarizes the key components of net income for 3Q19 and 3Q18.

$ in thousands For the three months ended    
  September 30,
2019
September 30,
2018
Increase
(Decrease)

% Change
Interest income $ 7,372   $ 5,419   $ 1,953   36 %
Interest expense   1,614     1,176     438   37 %
Net interest income   5,758     4,243     1,515   36 %
Provision for (recovery of) loan loss   (37 )   75     (112 ) NM  
Noninterest income   534     374     160   43 %
Noninterest expense, excluding merger expenses   3,821     3,170     651   21 %
Merger expenses   585     157     428   273 %
Pre-tax income   1,923     1,215     708   58 %
Income tax expense   496     300     196   65 %
Net income $ 1,427   $ 915   $ 512   56 %
         
Non-GAAP measurements:        
Net income $ 1,427   $ 915      
Adjustments:        
+ Merger expenses   585     157      
- Accretion of purchased loan discounts   (78 )   (2 )    
- Accretion of purchased time deposit discounts   8     -      
+ Amortization of core deposit intangible   138     9      
- Net tax effect of adjustments   (71 )   (17
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