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

GADSDEN, Ala., Aug. 15, 2018 (GLOBE NEWSWIRE) -- Gates Little, President and Chief Executive Officer of The Southern Banc Company, Inc. (OTCBB: SRNN), the holding company for The Southern Bank Company, announced preliminary unaudited results (subject to audit adjustments following the fiscal year-end audit) of operations for the fourth quarter and year ended June 30, 2018:

  • For the three months ended June 30, 2018, the Company reported net income of approximately $61,000, or $0.08 per basic and diluted share as compared to a net loss of approximately $447,000, or $(0.58) per basic and diluted share, for the three months ended June 30, 2017.
  • For the fiscal year ended June 30, 2018, the Company recorded a net loss of approximately $565,000, or $(0.74) per basic and diluted share, as compared to a net loss of approximately $792,000, or $(1.03) per basic and diluted share, for the fiscal year ended June 30, 2017. The net loss for fiscal year 2018 included a one-time charge of $655,221 resulting from the enactment of 2018 Tax Reform Bill.
  • For the three months ended June 30, 2018, net interest income before provision for loan losses increased approximately $347,000, or 36.4% as compared to the same period in 2017. The increase in net interest income for the three-month period was primarily attributable to an increase in interest and fees on loans in the amount of approximately $415,000, offset by a decrease in interest and dividends on securities of approximately $54,000. For the three months ended June 30, 2018, interest paid on deposits and borrowings increased approximately $27,000 as compared to the same period in 2017.
  • For the fiscal year ended June 30, 2018, net interest income before provision for loan losses increased approximately $1.1 million, or 31.5% as compared to fiscal year 2017. The increase in net interest income for the fiscal year was primarily attributable to an increase in interest and fees on loans of approximately $1.3 million, or 37.6%, offset by a decrease in interest and dividends on securities of approximately $169,000, or (23.2%). Total interest expense increased approximately $65,000, or 8.7%. For the fiscal year ended June 30, 2018 provision for loan losses decreased approximately $435,000 from $1,208,000 for fiscal year 2017 to $773,000 for fiscal year 2018.
  • For the fiscal year ended June 30, 2018, non-interest income increased approximately $30,000, or 22.4% from $136,000 for fiscal year 2017 to $166,000 for fiscal year 2018. The increase in non-interest income was primarily attributable to increases in customer service fees of approximately $24,000 and miscellaneous income of approximately $22,000 offset by a decrease in net gain on sale of securities of approximately $16,000.
  • For the three months ended June 30, 2018 total non-interest expenses increased approximately $117,000, or 13.2%, as compared to the same three-month period in 2017. The increase in non-interest expense for the three-month period was primarily attributable to increases in salaries and benefits of approximately $62,000 or 13.0% due to an increase in personnel, an increase in professional service expense of approximately $36,000 or 35.8% and an increase in other operating expenses of approximately $22,000 or 15.9% offset in part by a decrease in occupancy expenses of approximately $6,000, or (10.8%).
  • For the fiscal year ended June 30, 2018, total non-interest expenses increased approximately $128,000, or 3.5%, as compared to fiscal year 2017. The increase in non-interest expense for the fiscal year was primarily attributable to increases in professional services expense of approximately $47,000, or 13.0%, and salary and benefit expenses of approximately $53,000, or 2.6%, offset in part by a decrease in occupancy expenses of approximately $20,000 or (8.2%).

The Company’s total assets at June 30, 2018 and June 30, 2017 were approximately $95.9 million and $96.5 million, respectively. Total stockholders’ equity was approximately $10.9 million, or 11.4% of assets and $11.8 million, or 12.3% of assets at June 30, 2018 and 2017, respectively.

The unaudited financial information for the three and twelve months ended June 30, 2018 has been prepared on the same basis as our audited financial information and includes, in the opinion of management, all adjustments necessary to present the data for such periods. The Company expects to release its final year end results and its related audited financial statements in October 2018, following completion of the year-end audit. Historical results are not necessarily indicative of future results. The Bank has four full service banking offices located in Gadsden, Albertville, Guntersville, and Centre, AL, and one loan production office in Birmingham, AL. The stock of The Southern Banc Company, Inc. is listed on the OTC Bulletin Board under the symbol “SRNN”.

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

(Selected financial data attached)

THE SOUTHERN BANC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Dollar Amounts in Thousands)

June 30, June 30,
2018 2017
(Unaudited)
ASSETS

CASH AND CASH EQUIVALENTS$4,215 $2,910
SECURITIES AVAILABLE FOR SALE, at fair value 19,599 28,775
SECURITIES HELD TO MATURITY, at amortized cost,
fair value of $0 and $0, respectively
0
FEDERAL HOME LOAN BANK (FHLB) STOCK 429 340
LOANS AND LEASES RECEIVABLE,
net of allowance for loan losses of $1,093 and $1,238, respectively
69,002 61,309
PREMISES AND EQUIPMENT, net 715 754
ACCRUED INTEREST AND DIVIDENDS RECEIVABLE 216 216
PREPAID EXPENSES AND OTHER ASSETS 1,689 2,238
TOTAL ASSETS$95,865 $96,542
LIABILITIES

DEPOSITS$77,015 $79,383
FHLB ADVANCES 6,000 5,000
OTHER LIABILITIES 1,940 312
TOTAL LIABILITIES 84,955 84,695
STOCKHOLDERS' EQUITY:
Preferred stock, par value $.01 per share
500,000 shares authorized, shares issued
and outstanding—none
0 0
Common stock, par value $.01 per share,
3,500,000 authorized, 1,454,750 shares issued,
806,086 shares outstanding
15 15
Additional paid-in capital 13,887 13,887
Shares held in trust,
39,260 shares at cost
(706) (706)
Retained earnings 6,812 7,373
Treasury stock, at cost,
648,664 shares
(8,825) (8,825)
Accumulated other comprehensive income (273) 103


TOTAL STOCKHOLDERS’ EQUITY
10,910 11,847


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY


$
95,865 $96,542


THE SOUTHERN BANC COMPANY, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollar Amounts in Thousands, except per share data)

Three Months Ended Year Ended
June 30, June 30,
2018
(Unaudited)
2017 2018
(Unaudited)
2017
INTEREST INCOME:

Interest and fees on loans$1,369 $954 $4,771 $3,467
Interest and dividends on securities 119 173 559 728
Other interest income 19 6 48 22


Total interest income
1,507 1,133

5,378


4,217


INTEREST EXPENSE:
Interest on deposits 170 167 670 703
Interest on borrowings 34 10 134 36
Total interest expense 204 177 804 739
Net interest income before provision
for loan losses
1,303 956

4,574


3,478
Provision for loan losses 192 812 773 1,208
Net interest income after provision
for loan losses
1,111 144

3,801


2,270


NON-INTEREST INCOME:
Fees and other non-interest income 29 19 105 81
Gain on sale of securities, net 0 0 7 23
Miscellaneous income 8 8 54 32
Total non-interest income 37 27 166 136


NON-INTEREST EXPENSE:
Salaries and employee benefits 543 481 2,083 2,030
Equipment and Occupancy expenses 51 58 224 244
Professional Services Expense 138 102 413 366
Data Processing Expense 125 121 479 479
Other operating expense 156 134 614 566
Total non-interest expense 1,013 896 3,813 3,685
Income / (loss) before income taxes
135

(725


)

154

(1,279


)
PROVISION / (BENEFIT) FOR INCOME TAXES
74

(278


)
719 (487)
Net Income (Loss)$
61
$
(447


)
$
(565


)
$
(792


)
INCOME (LOSS) PER SHARE:
Basic$0.08 $(0.58)

$
(0.74)$(1.03)
Diluted$0.08 $(0.58) $(0.74)$(1.03)


DIVIDENDS DECLARED PER SHARE


$
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$
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$
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$
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AVERAGE SHARES OUTSTANDING:
Basic 766,826 769,817 766,826 769,817
Diluted 766,826 769,817 766,826 769,817


Contact: Gates Little
(256) 543-3860

Source:The Southern Banc Company, Inc.