Coastal Financial (NASDAQ:CFCP)
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Coastal Financial Corporation (NASDAQ:CFCP) today announced earnings for
the second fiscal quarter ended March 31, 2007.
Net income for the second quarter of fiscal 2007 decreased 4.7% to $4.4
million or $0.20 per share ($0.19 per share diluted), as compared to
$4.6 million or $0.22 per share ($0.21 per share diluted) for the same
period of fiscal 2006.
Net income for the first two quarters of fiscal 2007 increased 2.4% to
$9.3 million or $0.42 per share ($0.41 per share diluted), compared to
$9.1 million or $0.42 per share ($0.41 per share diluted) for the same
period of fiscal 2006.
At March 31, 2007, assets totaled $1.68 billion, an increase of 2.1%
from $1.64 billion at March 31, 2006. During the same period, Customer
Deposits decreased 0.8%, from $891.1 million to $883.9 million, and net
loans receivable increased 7.7%, from $1.0 billion to $1.1 billion. In
comparing the second quarters of fiscal 2006 and 2007, net interest
income after provision for loan losses grew 7.5% to $13.8 million.
Returns on average assets and average equity were 1.12% and 15.59%,
respectively, for the six months ended March 31, 2007, as compared to
1.14% and 18.38% for the comparable period in fiscal 2006.
At March 31, 2007, non-performing assets to total assets was 0.20% as
compared with 0.26% at March 31, 2006.
Michael C. Gerald, President and Chief Executive Officer of Coastal
Financial Corporation, noted that, during the second quarter of fiscal
2007, the corporation announced a 9.9% increase in fiscal 2007 first
quarter net income, and a $.05 per share cash dividend payable April 20,
2007 to Shareholders of record April 6, 2007.
Coastal Financial Corporation, headquartered in Myrtle Beach, South
Carolina, offers a broad range of commercial, consumer and mortgage
financial services through its subsidiary, Coastal Federal Bank. Coastal
Federal Bank, with assets of $1.7 billion, is a federally chartered and
FDIC insured community bank with twenty-four offices serving the
Communities of Horry and Georgetown Counties, South Carolina and
Brunswick and New Hanover Counties, North Carolina. Additional
information about Coastal Federal is available on its web site at www.coastalfederal.com.
Stock Trading Information
The common stock of Coastal Financial Corporation is traded on the
Nasdaq Stock Market under the symbol "CFCP." For information, contact
Raymond James Financial Services at 1-843-918-7600.
Dividend Reinvestment and Direct Stock Purchase Plan
Coastal Financial Corporation offers Shareholders a Dividend
Reinvestment and Direct Stock Purchase Plan which provides existing and
new shareholders a convenient means for making purchases of Coastal
Financial shares free of fees and brokerage commissions. Additional cash
contributions, up to $1,000 per quarter, can be made to purchase
additional shares. For more information, contact the Transfer Agent at
1-800-866-1340, Ext. 2514, or Investor Relations.
Shareholder Services
Shareholders desiring to enroll in the Coastal Financial Corporation
Dividend Reinvestment Plan, change the name, address, or ownership of
their stock certificates, report lost or stolen certificates, or
consolidate accounts should contact the Transfer Agent at
1-800-866-1340, Ext. 2514, or Investor Relations.
Investor Relations
Analysts, investors and others seeking financial information should
contact:
Susan J. Cooke - Senior Vice President and Secretary
Coastal Financial Corporation
2619 Oak Street
Myrtle Beach, South Carolina 29577
(843) 205-2676
Forward Looking Statements
This report may contain certain “forward-looking
statements” within the meaning of Section 27A
of the Securities Exchange Act of 1934, as amended, that represent the
Company’s expectations or beliefs concerning
future events. All forward-looking statements are based on assumptions
and involve risks and uncertainties, many of which are beyond the Company’s
control and which may cause its actual results, performance or
achievements to differ materially from the results, performance or
achievements contemplated by the forward-looking statements.
Forward-looking statements can be identified by the fact that they do
not relate strictly to historical or current facts. They often include
words such as “believe,”
“expect,” “anticipate,”
“intend,” “plan,”
“estimate” or
words of similar meaning, or future or conditional verbs such as “will,”
“would,” “should,”
“could” or “may.”
Forward-looking statements speak only as of the date they are made. Such
risks and uncertainties include, among other things:
• Competitive pressures among depository and
other financial institutions in the Company’s
market areas may increase significantly.
• Adverse changes in the economy or business
conditions, either nationally or in the Company’s
market areas, could increase credit-related losses and expenses and/or
limit growth.
• Increases in defaults by borrowers and
other delinquencies could result in increases in the Company’s
provision for losses on loans and related expenses.
• The Company’s
inability to manage growth effectively, including the successful
expansion of the Company’s Customer support,
administrative infrastructure and internal management systems, could
adversely affect the Company’s results of
operations and prospects.
• Fluctuations in interest rates and market
prices could reduce the Company’s net
interest margin and asset valuations and increase expenses.
• The consequences of continued bank
acquisitions and mergers in the Company’s
market areas, resulting in fewer but much larger and financially
stronger competitors, could increase competition for financial services
to the Company’s detriment.
• The Company’s
continued growth will depend in part on its ability to enter new markets
successfully and capitalize on other growth opportunities.
• Changes in legislative or regulatory
requirements, or actions by the Securities and Exchange Commission (“SEC”),
the Financial Accounting Standards Board (“FASB”),
or the Public Company Accounting Oversight Board, applicable to the
Company and its subsidiaries could increase costs, limit certain
operations and adversely affect results of operations.
• Changes in tax requirements, including tax
rate changes, new tax laws and revised tax law interpretations may
increase the Company’s tax expense or
adversely affect its Customers’ businesses.
• Company initiatives now in place or
introduced in the future, not producing results consistent with historic
growth rates or results which justify their costs.
In light of these risks, uncertainties and assumptions, you should not
place undue reliance on any forward-looking statements in this report.
Except as may be required by applicable law or regulation, the Company
undertakes no obligation to publicly update or otherwise revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
COASTAL FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited - Dollars in Thousands Except Per Share Data)
Three Months Ended
Six Months
Ended
March 31,
March 31,
Percentage
March. 31,
March 31,
Percentage
2007
2006
Change
2007
2006
Change
Interest Income
$
27,266
$
24,138
12.96%
$
54,664
$
47,176
15.87%
Interest Expense
13,461
10,970
22.71%
26,995
20,732
30.21%
Net Interest Income
13,805
13,168
4.84%
27,669
26,444
4.63%
Provision for Loan Losses
0
330
-100.00%
225
730
-69.18%
Net Interest Income After Provision for Loan Losses
13,805
12,838
7.53%
27,444
25,714
6.73%
Other Income (1)
4,965
4,201
18.19%
9,996
7,790
28.32%
General & Administrative Expenses (2)
12,065
9,926
21.55%
23,314
19,606
18.91%
Earnings Before Taxes
6,705
7,113
-5.74%
14,126
13,898
1.64%
Income Taxes
2,280
2,469
-7.65%
4,819
4,810
0.19%
Net Income
$
4,425
$
4,644
-4.72%
$
9,307
$
9,088
2.41%
Earnings Per Common Share (3) (4)
Basic
$
0.20
$
0.22
-9.09%
$
0.42
$
0.42
n/a
Diluted
$
0.19
$
0.21
-9.52%
$
0.41
$
0.41
n/a
Average Common Shares Outstanding (3) (4)
Basic (in thousands)
22,228
21,502
3.38%
22,180
21,437
3.47%
Diluted (in thousands)
22,871
22,184
3.10%
22,838
22,132
3.19%
Net Interest Margin
3.54%
3.57%
-0.84%
3.54%
3.64%
-2.75%
Return on Average Assets
1.06%
1.15%
-7.83%
1.12%
1.14%
-1.75%
Return on Average Equity
14.43%
18.63%
-22.54%
15.59%
18.38%
-15.18%
(1) Gains on sales of securities of zero and $25 are included in
other income for the quarter and six months ended March 31, 2007,
respectively. For the quarter and six months ended March 31, 2006,
gains (losses) on sales of securities were $30 and ($16),
respectively.
(2) Expenses related to the proposed merger with BB&T Corporation,
primarily consisting of professional fees, totaled approximately
$718 and $1.1 million for the quarter and six months ended March
31, 2007, respectively. In addition, the quarter and six-month
periods ended March 31, 2007, include a charitable contribution
pledge of $1.0 million.
(3) Earnings per share and average common shares outstanding for
the quarter and six months ended March 31, 2006 have been computed
to conform to the alternative transition method as provided under
FSP FAS 123R-3 “Transition Election
Related to Accounting for the Tax Effects of Share-Based Payment
Awards,” adopted by the Company
effective October 1, 2006.
(4) All share and per share data have been retroactively restated
for all common stock dividends.
COASTAL FINANCIAL CORPORATION
CONSOLIDATED FINANCIAL HIGHLIGHTS
(Unaudited - Dollars in Thousands Except Per Share Data)
(CONTINUED)
Percentage Change
from Sept. 30,
AtMarch 31,
AtSept 30,
AtMarch 31,
2007
2006
2006
2006
Total Assets
$
1,677,734
$
1,659,475
$
1,643,991
1.10%
Loans Receivable, Net
$
1,086,259
$
1,090,084
$
1,008,168
-0.35%
Customer Deposits (1)
$
883,921
$
909,788
$
891,136
-2.84%
Shareholders' Equity
$
129,318
$
112,824
$
100,209
14.62%
Non-Performing Assets
to Total Assets (2)
0.20%
0.21%
0.26%
-4.76%
Allowance for Loan Losses as a Percentage of Total Net Loans
1.17%
1.17%
1.21%
n/a
Tangible Book Value Per Share
$
5.70
$
5.20
$
4.65
9.62%
At or for the
Three Months Ended
March 31, 2007
At or for the
Three Months Ended
Sept. 30, 2006
Percentage Change
Credit Quality:
Non-Performing Loans
$
2,758
$
2,990
-7.76%
Non-Performing Loans as a % of Loans
0.25%
0.27%
-7.41%
Allowance for Loan Losses as a % of
Non-Performing Loans
461.86%
425.67%
8.50%
Non-Performing Assets (2)
$
3,390
$
3,561
-4.80%
Non-Performing Assets as a % of Loans and Foreclosed Property
0.31%
0.33%
-6.06%
Net Loan Charge-Offs as a % of Average Loans (Annualized)
0.01%
0.02%
-50.00%
Stock Performance at quarter end:
Market Price Per Share of Common Stock
$
15.63
$
12.60
24.05%
Indicated Annual Dividend
$
0.20
$
0.20
n/a
Dividend Yield
1.28%
1.59%
-19.50%
Price/Book Ratio
274.00%
242.00%
13.22%
Market Capitalization
$
354,879
$
273,250
29.87%
(1) Customer Deposits exclude brokered deposits. Brokered
deposits were $159,662, $153,317 and $189,304 at March 31, 2007,
September 30, 2006 and March 31, 2006, respectively.
(2) Non-performing assets consist of non-accrual loans 90 days or
more past due and real estate owned.