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

GADSDEN, Ala., Sept. 13, 2017 (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 year-end audit) of operations for the fourth quarter and year ended June 30, 2017:

  • For the three months ended June 30, 2017, the Company reported net loss of approximately $447,000, or $(0.58) per basic and diluted share as compared to a net loss of approximately $1,242,000, or $(1.61) per basic and diluted share, for the three months ended June 30, 2016. 
     
  • For the fiscal year ended June 30, 2017, the Company recorded a net loss of approximately $792,000, or $(1.03) per basic and diluted share, as compared to a net loss of approximately $1,358,000, or $(1.76) per basic and diluted share, for the fiscal year ended June 30, 2016.
     
  • For the three months ended June 30, 2017, net interest income before provision for loan losses increased approximately $188,000, or 24.5% as compared to the same period in 2016. The increase in the 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 $203,000 offset by a decrease in interest and dividends on securities of approximately $37,000. For the three months ended June 30, 2017, interest paid on deposits and borrowings decreased approximately $20,000 as compared to the same period in 2016.
     
  • For the fiscal year ended June 30, 2017, net interest income before provision for loan losses increased approximately $354,000, or 11.3% as compared to fiscal year 2016.  The increase in the net interest margin for the fiscal year was primarily attributable to an increase in total interest income of approximately $286,000, or 7.3% offset by a decrease in total interest expense of approximately $68,000, or 8.4%. For the fiscal year ended June 30, 2017 provision for loan losses decreased approximately $651,000 from $1,859,000 for fiscal year 2016 to $1,208,000 for fiscal year 2017.
     
  • For the fiscal year ended June 30, 2017, non-interest income decreased approximately $137,000, or 50.4% from $273,000 for fiscal year 2016 to $136,000 for fiscal year 2017.  The decrease in non-interest income was primarily attributable to a decrease in net gain on sale of securities of approximately $135,000 and a decrease in customer service fees of approximately $9,000 offset by an increase in miscellaneous income of approximately $7,000.
     
  • For the three months ended June 30, 2017 total non-interest expenses decreased approximately $179,000, or 16.7%, as compared to the same three month period in 2016.  The decrease in non-interest expense for the three month period was primarily attributable to decreases in salaries and benefits of approximately $75,000 or 13.5% due to a reduction in bonus accruals, a reduction in professional service expense of approximately $60,000 or 37.3% and a reduction in other operating expenses of approximately $48,000 or 25.7%.
     
  • For the fiscal year ended June 30, 2017, total non-interest expenses decreased approximately $58,000, or 1.54%, as compared to fiscal year 2016.  The decrease in non-interest expense for the fiscal year was primarily attributable to decreases in professional services expense of approximately $60,000, or 14.2%, and salary and benefit expenses of approximately $37,000, or 1.8%, offset by an increase in data processing expenses of approximately $33,000 or 7.4%.

The Company’s total assets at June 30, 2017 and June 30, 2016 were approximately $97.9 million.  Total stockholders’ equity was approximately $11.9 million, or 12.1% of assets and $13.2 million, or 13.5% of assets at June 30, 2017 and 2016, respectively.

The unaudited financial information for the three and twelve months ended June 30, 2017 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 2017, 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,
    2017     2016
    (Unaudited)      
           
ASSETS

         
CASH AND CASH EQUIVALENTS $ 2,911     $ 1,463  
SECURITIES AVAILABLE FOR SALE, at fair value   28,775       36,103  
SECURITIES HELD TO MATURITY, at amortized cost,
  fair value of $0 and $0, respectively
  0       0  
FEDERAL HOME LOAN BANK (FHLB) STOCK   340       388  
           
LOANS AND LEASES RECEIVABLE,
net of allowance for loan losses of $1,238 and $758, respectively
  62,700       57,121  
PREMISES AND EQUIPMENT, net   754       811  
ACCRUED INTEREST AND DIVIDENDS RECEIVABLE   220       247  
PREPAID EXPENSES AND OTHER ASSETS   2,233       1,754  
           
TOTAL ASSETS $ 97,933     $ 97,887  
           
           
LIABILITIES

         
DEPOSITS $ 79,383     $ 78,771  
FHLB ADVANCES   5,000       5,190  
OTHER LIABILITIES   1,703       727  
           
TOTAL LIABILITIES   86,086       84,688  
           
           
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, at cost,
   39,260 and 32,643 shares, respectively
  (706 )     (640 )
Retained earnings   7,374       8,166  
Treasury stock, at cost,
  648,664 shares
  (8,825 )     (8,825 )
Accumulated other comprehensive income   102       596  

TOTAL STOCKHOLDERS’ EQUITY

  11,847       13,199  

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

97,933     $ 97,887  
           

                                                            

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,
                     
    2017
(Unaudited)
    2016       2017
(Unaudited)
  2016  
                     
INTEREST INCOME:                    
                             
Interest and fees on loans $ 954     $ 751     $ 3,467   $ 2,943  
Interest and dividends on securities   173       209       728     968  
Other interest income   6       5       22     20  
                             
Total interest income   1,133       965       4,217     3,931  
                             
INTEREST EXPENSE:                    
Interest on deposits   167       187       703     758  
Interest on borrowings   10       10       36     49  
Total interest expense   177       197       739     807  
Net interest income before provision for loan losses   956       768       3,478     3,124  
Provision for loan losses   812       1,733       1,208     1,859  
Net interest income after provision for loan losses   144       (965 )     2,270     1,265  
                     
NON-INTEREST INCOME:                    
Fees and other non-interest income   19       18       81     90  
Gain on sale of securities, net   0       0       23     158  
Miscellaneous income   8       4       32     25  
Total non-interest income   27       22       136     273  
                     
NON-INTEREST EXPENSE:                    
Salaries and employee benefits   481       556       2,030     2,067  
Equipment and Occupancy expenses   58       62       244     244  
Professional Services Expense   102       162       366     426  
Data Processing Expense   121       113       479     446  
Other operating expense   134       182       566     560  
Total non-interest expense   896       1,075       3,685     3,743  
                             
                             
Loss before income taxes   (725 )     (2,018 )     (1,279 )   (2,205 )
                             
BENEFIT FOR INCOME TAXES   (278 )     (776 )     (487 )   (847 )
                             
Net Loss $ (447 )   $ (1,242 )   $ (792 ) $ (1,358 )
                             
LOSS PER SHARE:                            
Basic $ (0.58 )   $ (1.61 )   $ (1.03 ) $ (1.76 )
Diluted $ (0.58 )   $ (1.61 )   $ (1.03 ) $ (1.76 )
                             
                             
DIVIDENDS DECLARED PER SHARE $     $     $   $  
                     
AVERAGE SHARES OUTSTANDING:                    
Basic   766,826       773,443       769,799     773,443  
Diluted   766,826       773,443       769,799     773,443  
                             

Contact: Gates Little
(256) 543-3860