Community Bankers (ESXB) Tops Q4 EPS by 1c

Community Bankers (NASDAQ: ESXB) reported Q4 EPS of $0.18, $0.01 better than the analyst estimate of $0.17.

Income Statement- Three Months ended December 31, 2019 compared with Three Months ended September 30, 2019

• Net income of $4.0 million for the fourth quarter of 2019 compares with third quarter 2019 net income of $4.6 million.
• Third quarter net income exceeded fourth quarter net income by $568,000 as the third quarter was boosted by a $1.1 million payoff of a purchased credit impaired (\"PCI\") loan with no carrying value.
• Loans grew $23.8 million, or 2.3%, during the fourth quarter of 2019, fueling interest income.
• Low cost NOW accounts grew $22.9 million, or 15.5%, during the fourth quarter of 2019.
• There was a provision for loan losses of $200,000 recognized in the fourth quarter of 2019 as a result of robust loan growth.
• Interest on deposits declined $183,000, or 4.9%, on a linked quarter basis.
• Noninterest expenses declined $562,000, or 6.1%, on a linked quarter basis.
• Net interest margin was 3.74% in the fourth quarter of 2019 and reflected a reduction in the cost of interest bearing liabilities from 1.49% in the third quarter to 1.43% in the fourth quarter of 2019.
• Return on average assets, annualized, was 1.14% and return on average equity, annualized, was 10.42% in the fourth quarter.

MANAGEMENT COMMENTS

Rex L. Smith, III, President and Chief Executive Officer, stated, "I am pleased with the overall results of both the fourth quarter and the full year 2019, particularly the 14.7% growth in net income. The increase in net income was fueled by several strategic initiatives that included better loan yields, higher fee income from the increase in transaction accounts as well as better than expected results for mortgage and investment sales income. Additionally, we were able to hold noninterest expense to less than a 2.5% increase including a large onetime expense for taxes related to bringing our largest non-performing loan into OREO in the third quarter."

Smith added, "Loan growth for the fourth quarter was solid at 2.3%, which is 9.2% annualized, and the pipeline for the first quarter of 2020 is very strong. Credit quality remains strong and the pipeline is diversified by loan type as well as spread across our geographic footprint."

Smith concluded, "We continue to emphasize key metrics that will enhance shareholder returns. This includes ways to leverage our capital, as shown most recently in the increase in our common stock dividend and a new stock repurchase program. Our markets are large and diverse, which will allow us to continue our controlled growth strategy and sustained strong earnings per share growth in 2020."

For earnings history and earnings-related data on Community Bankers (ESXB) click here.

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