FBSI First Bancshares, Inc. (MM)

First Bancshares, Inc. (OTCQB:FBSI), the holding company for First Home Savings Bank ("Bank"), today announced its financial results for the fourth quarter and for the fiscal year ended June 30, 2013.

For the quarter ended June 30, 2013, the Company had net income of $116,000, or $0.07 per share – diluted, compared to net income of $100,000, or $0.06 per share – diluted for the quarter ended June 30, 2012. The increase in net income for the quarter ended June 30, 2013 compared to the quarter ended June 30, 2012 is attributable to a decrease of $664,000 in non-interest expense and an increase of $8,000 in non-interest income. This was partially offset by a decrease of $85,000 in net interest income and a decrease of $571,000 in gain on sale of investments.

During the quarter ended June 30, 2013, net interest income decreased by $85,000, or 6.7%, to $1.2 million from $1.3 million during the quarter ended June 30, 2012. This decrease was the result of a decrease in interest income of $114,000, or 7.1%, which was partially offset by a decrease in interest expense of $29,000, or 8.5%. The decrease in both interest income and interest expense was primarily the result of a decrease in market interest rates between the two periods.

There was no provision for loan losses for the quarter ended June 30, 2013 and June 30, 2012. Classified loans at June 30, 2013 were $2.4 million compared to $6.8 million at June 30, 2012. The allowance for loan losses at June 30, 2013 was $1.6 million, or 1.7% of gross loans, compared to $1.8 million, or 1.9% of gross loans at June 30, 2012.

During the quarter ended June 30, 2013, gain on sale of investments were $3,000, a decrease of $571,000 compared to $574,000 during the quarter ended June 30, 2012.

Non-interest income increased by $8,000, or 2.7%, to $300,000 for the quarter ended June 30, 2013 from $292,000 for the quarter ended June 30, 2012. The increase was the result of recognizing a gain on sale of property of $21,000 during the quarter ended June 30, 2013. 

Non-interest expense decreased by $664,000, or 32.6%, to $1.4 million for the quarter ended June 30, 2013, compared to $2.0 million for the quarter ended June 30, 2012. The decrease reflects a decrease of $422,000 in write-downs on impairment on real estate owned, a decrease of $151,000 in salaries and employee benefits, a decrease of $41,000 in premises and fixed assets, a decrease of $14,000 in professional fees, a decrease of $23,000 in FDIC insurance premiums and a decrease of $13,000 in other non-interest expenses.

For the year ended June 30, 2013, the Company had a net loss of $93,000, or $0.06 per share - diluted, compared to a net loss of $1.4 million, or $0.92 per share - diluted for the year ended June 30, 2012. The decrease in net loss for the year ended June 30, 2013 compared to the year ended June 30, 2012 is attributable to a decrease of $282,000 in the provision for loan losses, a decrease of $2.0 million in non-interest expense and a decrease of $85,000 in income tax expense. This was partially offset by a decrease of $443,000 in net interest income, a decrease of $403,000 in gain on sale of investments and a decrease of $157,000 in non-interest income.

For the year ended June 30, 2013, net interest income decreased by $443,000, or 8.4%, to $4.8 million from $5.3 million for the year ended June 30, 2012. The decrease was the result of a decrease in interest income of $673,000, or 10.0%, which was partially offset by a decrease in interest expense of $230,000, or 15.4%.

For the year ended June 30, 2013, there was no provision for loan losses, compared to a provision of $282,000 for the year ended June 30, 2012. This decrease was primarily the result of a decrease in classified loans. Classified loans decreased $3.7 million from $5.8 million at June 30, 2012 to $2.1 million at June 30 2013.

Gain on sale of investments decreased by $403,000, or 56.6%, to $309,000 for the year ended June 30, 2013 compared to $712,000 for the year ended June 30, 2012. 

Non-interest income decreased by $157,000 to $820,000 for the year ended June 30, 2013 from $977,000 for the year ended June 30, 2012. This decrease is the result of an increase in loss on sale of real estate owned and other repossessed assets of $165,000 and a decrease in service charges on deposit accounts of $5,000. This was partially offset by an increase in BOLI income of $18,000 and an increase in other non-interest income items of $2,000.

Non-interest expense decreased by $2.0 million, or 24.7%, to $6.0 million for the year ended June 30, 2013 compared to $8.0 million for the year ended June 30, 2012. The decrease was the result of a decrease in impairment on real estate owned of $1.1 million, a decrease of $359,000 in salaries and employee benefits, a decrease of $82,000 in occupancy and equipment, a decrease of $235,000 in professional fees, and a decrease in other non-interest expense items of $247,000. Included in the Company's salaries and employee benefits expense for the year ended June 30, 2013 is a one-time early retirement package with an expense of $186,000.

Total consolidated assets at June 30, 2013 were $191.7 million, compared to $193.4 million at June 30, 2012, representing a decrease of $1.7 million, or 0.9%. Stockholders' equity at June 30, 2013 was $14.3 million, or 7.4% of assets, compared with $16.3 million, or 8.4% of assets at June 30, 2012. Book value per common share decreased to $9.19 at June 30, 2013 from $10.53 at June 30, 2012. The $2.1 million, or 12.8% decrease in stockholders' equity was attributable to a decrease in the unrealized gain on available-for-sale securities, net of income taxes of $2.0 million and a net loss for the year ended June 30, 2013 of $93,000.

Net loans receivable increased $33,000, or 0.03%, to $95.55 million at June 30, 2013 from $95.52 million at June 30, 2012. Deposits decreased $2.0 million, or 1.2%, to $163.8 million at June 30, 2013 from $165.9 million at June 30, 2012. Retail repurchase agreements decreased $55,000, or 0.85%, to $6.39 million at June 30, 2013 from $6.45 million at June 30, 2012. FHLB advances increased to $6.4 million at June 30, 2013 from $3.4 million at June 30, 2012.

First Bancshares, Inc. is the holding company for First Home Savings Bank, a FDIC-insured savings bank chartered by the State of Missouri that conducts business from its home office in Mountain Grove, Missouri, and eight full service offices in Marshfield, Ava, Gainesville, Sparta, Springfield, Crane, Kissee Mills and Rockaway Beach, Missouri.

The Company and its wholly-owned subsidiary, First Home Savings Bank, may from time to time make written or oral "forward-looking statements" in its reports to stockholders, and in other communications by the Company, which are made in good faith by the Company pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements include statements with respect to the Company's beliefs, expectations, estimates and intentions that are subject to significant risks and uncertainties, and are subject to change based on various factors, some of which are beyond the Company's control. Such statements address the following subjects: future operating results; customer growth and retention; loan and other product demand; earnings growth and expectations; new products and services; credit quality and adequacy of reserves; results of examinations by our bank regulators, our compliance with the Company's Order to Cease and Desist , technology, and our employees. The following factors, among others, could cause the Company's financial performance to differ materially from the expectations, estimates and intentions expressed in such forward-looking statements: the strength of the United States economy in general and the strength of the local economies in which the Company conducts operations; the effects of, and changes in, trade, monetary, and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; inflation, interest rate, market, and monetary fluctuations; the timely development and acceptance of new products and services of the Company and the perceived overall value of these products and services by users; the impact of changes in financial services' laws and regulations; technological changes; acquisitions; changes in consumer spending and savings habits; and the success of the Company at managing and collecting assets of borrowers in default and managing the risks of the foregoing.

The foregoing list of factors is not exclusive. The Company does not undertake, and expressly disclaims any intent or obligation, to update any forward-looking statement, whether written or oral, that may be made from time to time by or on behalf of the Company.

First Bancshares, Inc. and Subsidiaries
Financial Highlights
(In thousands, except per share amounts)
	Quarter		Year
	Ended June 30,		Ended June 30,
	2013	2012	2013	2012
Operating Data:
Total interest income	$1,494	$1,608	$6,074	$6,747
Total interest expense	311	340	1,261	1,491
Net interest income	1,183	1,268	4,813	5,256
Provision for loan losses	0	0	0	282
Net interest income after provision for loan losses	1,183	1,268	4,813	4,974
Gain on sale of investments	3	574	309	712
Non-interest income	300	292	820	977
Non-interest expense	1,370	2,034	6,035	8,012
Income (loss) before income tax	116	100	(93)	(1,349)
Income tax expense	0	0	0	85
Net income (loss)	$116	$100	$(93)	$(1,434)
Net income (loss) per share-basic	$0.07	$0.06	$(0.06)	$(0.92)
Net income (loss) per share-diluted	$0.07	$0.06	$(0.06)	$(0.92)
	At	At
	June 30,	June 30,
Financial Condition Data:	2013	2012
Total assets	$191,680	$193,417
Loans receivable, net	95,554	95,521
Cash and cash equivalents (excludes CDs)	11,705	12,658
Investment securities	75,395	73,845
Deposits	163,834	165,858
Borrowed funds	12,791	9,846
Stockholders' equity	14,250	16,335
Book value per share	$9.19	$10.53

CONTACT: R. Bradley Weaver, President and CEO - (417) 926-5151