AI
Wednesday, July 25, 2007 9:24:50 AM
OFSI 7.41 Omni Financial Services, Inc. Reports Record Second Quarter Earnings of $1.71Million, Growth of 21.3% and Declares Dividend
Jul 25, 2007 9:21:00 AM
Copyright Business Wire 2007
ATLANTA--(BUSINESS WIRE)--
Omni Financial Services, Inc. (NASDAQ: OFSI):
Second Quarter 2007 Highlights (compared to June 30, 2006 unless otherwise noted):
-- Net income of $1.71 million - increase of 21.3%
-- Diluted earnings per share of $0.15
-- Total capital of $71.9 million - increase of 99.8%
-- Asset growth of $271.7 million - increase of 46.4%
-- Net interest margin of 5.02% - 4 basis point linked quarter
increase
-- Dividend of $0.05 per share declared
Financial Performance
Omni Financial Services, Inc. (NASDAQ: OFSI), the bank holding company for Omni National Bank, reported an increase of 21.3% in net income for the three months ended June 30, 2007, to $1.7 million or $0.15 per diluted share, compared to $1.4 million or $0.18 per diluted share in the same quarter in 2006. Comparing linked quarters, net income increased 17.5% or $0.02 per diluted share, from the first quarter of 2007. For the six months ended June 30, 2007 the Company posted net income of $3.2 million or $0.28 per diluted share, which is a net income increase of 15.9% as compared to $2.7 million or $0.36 for the six month period ended June 30, 2006. For comparison purposes, net income for the six months ended June 30, 2006 has been reduced by a $3.69 million tax credit recorded on January 1, 2006 upon conversion from an S-Corporation to a C-Corporation at January 1, 2006. Including the tax credit, net income calculated in accordance with generally accepted accounting principles ("GAAP") for the six months ended June 30, 2006 was $6.4 million or $0.85 per diluted share.
The primary reason for the increase in earnings during 2007 is expansion in net interest income, which was driven by a $193.1 million or 52% increase in average loans outstanding for the six months ended June 30, 2007 as compared to the six months ended June 30, 2006. Chairman and CEO Stephen Klein stated, "We are pleased that quarter after quarter we are able to produce record earnings and consistent loan growth for our shareholders." Earnings for the quarter were also positively impacted by the May 2007 recovery of $357,000 relating to a $1.0 million fraud loss recorded in December 2005 in the warehouse lending line of business. President Irwin Berman noted, "Our diligence in pursuing this matter has resulted in the recovery of 35% of the loss previously recognized. While further recovery remains uncertain, we continue to pursue our options."
Net Interest Income and Margin
For the three months ended June 30, 2007, the Company recorded record net interest income of $9.2 million, an increase of $2.78 million or 43.1% from $6.5 million for the same period in 2006, the result of continued strong loan growth which drove the increase in average earning assets of $223.5 million or 42.6% when compared to the same period in 2006. Compared to the first quarter of 2007, net interest income increased $847,000 or 10.10%.
The Company's net interest margin for the quarter was 5.02%, which was four basis points below second quarter 2006 but an increase of 4 basis points from the quarter ended March 31, 2007.
Loans
Loans, net of deferred loan fees, were $610.5 million at June 30, 2007, an increase of $189.2 million or 44.9% when compared to $421.3 million at June 30, 2006. On a linked-quarter basis, gross loans grew $40.6 million or 7.1% over the prior quarter. For the quarter ended June 30, 2007, net charge-offs totaled $456,000, resulting in an annualized net charge-off ratio of 0.31% compared to $174,000 or 0.18% for the quarter ended June 30, 2006 and $56,000 or 0.04% for the linked quarter. Approximately $175,000 or 38% of the net charge-offs related to losses recognized for properties in Griffin and Macon, Georgia that were foreclosed and taken into OREO during the quarter. During the first quarter of 2007 the Company noted that an accelerated economic downturn in these markets had increased non performing assets. An additional $146,000 or 32% of the net charge-offs arose from losses recognized on the liquidation of collateral related to two loans acquired in the Company's July 2005 acquisition of a troubled Dalton Georgia bank.
On a linked quarter basis, the provision for loan losses increased $455,000 or 46%. $424,000 of the increase was attributable to specific reserves related to two loans for which the Company has identified a probable incurred loss. The ratio of the allowance for loan losses to loans increased from 1.33% to 1.40%. Without the specific reserves noted, the ratio would have been 1.33%. The provision for loan losses for the three months ended June 30, 2006 was $725,000 and the ratio of the allowance for loan losses to loans was 1.32%. The $716,000 or 99% year over year increase in the provision reflects the Bank's significant loan growth.
Total non-performing assets as a percentage of total loans and OREO increased to 2.42% as of June 30, 2007 compared to 2.03% as of March 31, 2007 and 1.64% as of June 30, 2006. While there was a large reduction in non-performing assets in the community redevelopment portfolio to 0.92% of loans and OREO, from 1.38% of loans and OREO as of March 31, 2007, there was an increase in non-performing assets in the Atlanta real estate construction portfolio (to 0.71% of loans and OREO from 0.05%) due to credit deterioration detected in 5 metro Atlanta residential construction relationships, totaling $5.4 million. "We have been proactive in facing the loan performance challenges that we have seen and may continue to see in the industry, and believe we have a strong team in place to manage the resulting opportunities," Chief Lending Officer Charlie Barnwell commented. "We continue to evaluate market data as it relates to residential housing absorption, and in particular, building lot absorption and sales so that we can identify potential issues and work with our borrowers to avoid default."
Financial Ratios
Certain performance ratios for the quarter ended June 30, 2007 compared to the quarter ended June, 2006 have been significantly impacted by the large increase in stockholders' equity and shares outstanding associated with the Company's initial public offering that was effective September 29, 2006 and was consummated in the fourth quarter of 2006. As a result of the offering, shares outstanding increased by 3,852,500 and net proceeds of $33.0 million were received. The increase in these items resulted in the denominators used in calculating certain ratios to increase, which resulted in reduced ratios for the current quarter, specifically for return on equity and earnings per share. As the proceeds from the offering are utilized in the growth of the business it is expected that the performance ratios will continue to increase and return to historical levels.
Return on average equity for the three months ended June 30, 2007 was 9.25% compared to 15.83% for the same period in 2006. Return on average assets for the three months ended June 30, 2007 was 0.85% compared to 1.00% for the same period in 2006. The Company's efficiency ratio (non-interest expense divided by the sum of net interest income and non-interest income) was 60.22% for the three months ended June 30, 2007 compared to 59.76% for the three months ended June 30, 2006.
On a linked quarter basis, return on average equity and assets improved from 8.05% and 0.79% to 9.25% and 0.85%, respectively, as more of the capital raised in 2006 has been deployed and begun to produce a return. Also on a linked quarter basis, there was improvement in the efficiency ratio from 65.50% to 60.22%.
Selected Financial Information
For the Three Months Ended June 30
-----------------------------------
2007 2006 % Change
------------ ------------ ---------
Share Data
Diluted earnings per share (1) $ 0.15 $ 0.18 -16.67%
Book value at period end $ 6.41 $ 4.80 33.50%
Tangible book value at period end $ 5.89 $ 4.03 46.18%
Performance Ratios:
Return on average equity (1) (2) 9.25% 15.83% -41.57%
Net interest margin 5.02% 5.06% -0.88%
Efficiency ratio 60.22% 59.76% 0.77%
Credit Quality Ratios:
Allowance for loan losses to loans 1.40% 1.32% 6.06%
Nonperforming assets to total
assets 1.74% 1.19% 46.57%
Nonperforming assets to total loans
and Oreo 2.42% 1.58% 53.22%
Net charge-offs to average loans
(2) 0.31% 0.18% 72.22%
Selected Balance Sheet Averages:
Loans outstanding $585,922,266 $397,518,592 47.39%
Total assets $802,534,768 $562,571,304 42.65%
Interest-earning assets $748,415,943 $524,924,386 42.58%
Deposits $620,400,496 $399,348,478 55.35%
Tangible shareholders equity $ 68,217,130 $ 29,842,787 128.59%
Shareholders' equity $ 74,005,291 $ 35,658,426 107.54%
(1)The six month period ended June 30, 2006 has been adjusted to
reflect the $3.69 million tax credit related to our conversion from
an S-Corporation to a C-Corporation, recognized on January 1, 2006.
(2)Annualized
----------------------------------------------------------------------
For the Six Months Ended June 30
----------------------------------
2007 2006 % Change
------------ ------------ --------
Share Data
Diluted earnings per share (1) $ 0.28 $ 0.36 -22.22%
Book value at period end $ 6.41 $ 4.80 33.50%
Tangible book value at period end $ 5.89 $ 4.03 46.18%
Performance Ratios:
Return on average equity (1) (2) 8.66% 36.94% -76.56%
Net interest margin 5.01% 5.01% 0.01%
Efficiency ratio 62.72% 62.70% 0.03%
Credit Quality Ratios:
Allowance for loan losses to loans 1.40% 1.32% 6.06%
Nonperforming assets to total
assets 1.74% 1.19% 46.57%
Nonperforming assets to total
loans and Oreo 2.42% 1.58% 53.22%
Net charge-offs to average loans
(2) 0.18% 0.11% 63.64%
Selected Balance Sheet Averages:
Loans outstanding $561,964,567 $368,844,315 52.36%
Total assets $768,147,016 $529,836,306 44.98%
Interest-earning assets $718,920,830 $494,468,429 45.39%
Deposits $593,683,745 $380,289,702 56.11%
Tangible shareholders equity $ 67,781,725 $ 29,206,587 132.08%
Shareholders' equity $ 73,570,177 $ 35,024,206 110.06%
(1)The six month period ended June 30, 2006 has been adjusted to
reflect the $3.69 million tax credit related to our conversion from
an S-Corporation to a C-Corporation, recognized on January 1, 2006.
(2)Annualized
---------------------------------------------------------------------
Expansion Activities
During the second quarter, the Company continued its expansion activities. In April it celebrated the grand opening of a new Fayetteville, North Carolina branch, located on the north side of town and relocated the Dalton, Georgia branch to a new downtown location. The Company also expanded its geographic diversity by opening a loan production office in Dallas, Texas and entering into an agreement to acquire the charter of Wilson State Bank. The charter acquisition, which closed July 2, 2007, will allow the Company to provide full service banking in Dallas as well as expand full service banking throughout Texas. A Houston office is expected to open in the third quarter of 2007. The Company also acquired an office building in downtown Chicago, Illinois with the intent to increase its Chicago presence.
Like most financial institutions, the Bank continues to focus on core deposit growth. President Irwin Berman stated, "Although growing demand deposits continues to be a challenge, we are pleased with the growth of our money market and savings deposits which increased $32 million - more than 100% - since June 2006."
To support the continued growth, the Company added 15 new associates during the quarter. One area of focus was the Credit Administration area which added 4 employees. Chief Credit Officer Terry Lawson noted, "The additions to our Credit area further strengthen our already stringent credit culture."
Other Information
Quarterly Dividend. The board of directors declared a quarterly cash dividend of $0.05 per share at its July 24, 2007 board meeting. The dividend is payable on August 21, 2007 to shareholders of record as of August 6, 2007.
Stock Repurchase Program. On July 24, 2007, the board of directors authorized the Company to increase the aggregate size of its existing stock repurchase program by $8.6 million to provide for the repurchase of an aggregate of $10 million of stock, of which $1.4 million has been repurchased. The closing price of Omni Financial Services, Inc. common stock on June 29, 2007 (the last trading day of the quarter) was $8.12 per share.
The Georgia 100--Best of Business 2007. Omni Financial Services was ranked #27 in the Georgia 100, the Atlanta Journal-Constitution's annual list of Georgia's top 100 public companies based on 2006 performance. Rankings are computed by an independent accounting firm and are based on five weighted variables: annual revenue, year-over-year revenue change, return on equity, annual change in profit margin in fiscal 2006 and total return on investment (share price change plus reinvested dividends) for calendar 2006.
Conference Call / Webcast Information
Omni Financial Services, Inc. will host a conference call on Thursday, July 26 at 10:00 a.m. (ET) to discuss second quarter 2007 financial results. Additional material information, including forward-looking statements such as trends and projections, may be discussed during the presentation. To participate in the conference call or webcast, please follow the instructions listed below.
Conference Call: Please call 1-866-558-6901. A transcript of the call will be available 3 days after the event on the Company's website and will be available for 14 days following the event.
Webcast: To gain access to the webcast, which will be "listen-only," please go to www.onb.com and click on the link "Earnings Press Release." For those unable to participate during the live webcast, it will be archived on the Omni National Bank website for 14 days following the event.
About Omni
Omni Financial Services, Inc. is a bank holding company headquartered in Atlanta, Georgia. Omni Financial Services, Inc. provides a full range of banking and related services through its wholly owned subsidiary, Omni National Bank, a national bank headquartered in Atlanta, Georgia. Omni has one full service banking location in Atlanta, one in Dalton, Georgia, five in North Carolina, one in Chicago, Illinois, and one in Tampa, Florida. In addition, Omni has loan production offices in Charlotte, North Carolina, Dalton, Georgia, Birmingham, Alabama, Philadelphia, Pennsylvania, and Dallas, Texas. Omni provides traditional lending and deposit gathering capabilities, as well as a broad array of financial products and services, including specialized services such as community redevelopment lending, small business lending and equipment leasing, warehouse lending, and asset-based lending. Omni Financial Services, Inc.'s common stock is traded on the NASDAQ Global Market under the ticker symbol "OFSI." Additional information about Omni National Bank is available on its website at www.onb.com.
Except for historical information contained herein, the matters discussed in this press release consist of forward-looking information under the Private Securities Litigation Reform Act of 1995. The accuracy of the forward-looking information is necessarily subject to and involves risks and uncertainties, which could cause actual results to differ materially from the forward-looking information. These risks and uncertainties include, but are not limited to, unforeseen general economic conditions, potential difficulties in the execution of Omni Financial Services, Inc.'s business and growth strategies, competitive risks and other factors set forth from time to time in Omni Financial Services, Inc.'s filings with the Securities and Exchange Commission. When used in this release, the words "believes," "estimates," "plans," "expects," "should," "will," "may," "might," "outlook," and "anticipates" are similar expressions as they relate to Omni Financial Services, Inc.'s (including its subsidiaries), or its management, and are intended to identify forward-looking statements.
Omni Financial Services, Inc. from time to time becomes aware of rumors concerning its business, prospects and results of operations. As a matter of policy, Omni Financial Services, Inc. does not comment on rumors. Investors are cautioned that in this age of instant communication and Internet access, it may be important to avoid relying on rumors and other unsubstantiated information. Omni Financial Services, Inc. complies with federal and state laws applicable to the disclosure of information concerning its business, prospects and results of operations. Investors may be at significant risk in relying on unsubstantiated information from other sources.
Omni Financial Services, Inc.
Consolidated Balance Sheets
ASSETS June 30, December 31, June 30,
2007 2006 2006
------------ ------------ ------------
(unaudited) (unaudited)
Cash and due from banks $ 7,297,232 $ 5,874,453 $ 6,750,183
Interest-bearing deposits in
other financial institutions 2,126,795 319,961 1,906,400
Federal funds sold 37,827,000 16,341,000 -
------------ ------------ ------------
Total cash and cash
equivalents 47,251,027 22,535,414 8,656,583
Investment securities
available-for-sale 140,527,523 134,553,978 118,685,155
Other investments 5,927,500 4,836,100 6,388,600
Loans, net of allowance for
loan losses of $8,561,083,
$6,646,212, and $5,544,038 601,971,083 494,813,672 415,802,060
Loans held-for-sale 5,482,945 9,635,243 3,728,157
Equipment leased to others 3,053,399 - 27,112
Other real estate owned 5,306,283 3,377,719 1,786,917
Premises and equipment, net 22,714,099 10,707,034 11,912,047
Goodwill 4,753,887 4,753,887 4,753,887
Cash surrender value of life
insurance policies 1,225,236 1,201,275 1,177,489
Accrued interest and loan
related receivable 9,024,168 5,904,039 4,210,308
Deferred taxes 5,252,473 3,461,111 4,238,328
Other assets 4,745,912 6,984,509 4,202,184
------------ ------------ ------------
$857,235,535 $702,763,981 $585,568,827
============ ============ ============
LIABILITIES & STOCKHOLDERS'
EQUITY
Deposits:
Demand $ 44,722,493 $ 49,380,211 $ 41,009,788
Savings and money market 46,337,209 36,993,065 13,842,909
Certificates of deposit -
Retail 174,435,896 162,293,149 175,445,108
Certificates of deposit -
Brokered 411,592,611 296,003,247 198,013,438
------------ ------------ ------------
Total deposits 677,088,209 544,669,672 428,311,243
Federal Home Loan Bank
borrowings 77,500,000 57,500,000 92,000,000
Junior subordinated debentures 20,620,000 20,620,000 20,620,000
Federal funds purchased - - 1,842,000
Deferred gain on sale of OREO 702,668 576,808 315,875
Escrow accounts, accrued
interest payable and other
liabilities 9,440,111 7,050,415 6,507,590
------------ ------------ ------------
Total liabilities 785,350,988 630,416,895 549,596,708
Common stock, par value $1.00;
25,000,000 shares authorized:
11,390,069, 11,348,928,
7,492,978 shares issued;
11,218,148, 11,332,307,
7,492,977 outstanding 11,390,069 11,348,928 7,492,978
Additional paid-in capital 54,863,563 54,567,172 25,276,224
Retained earnings 9,321,025 7,296,572 5,158,561
Accumulated other comprehensive
loss (2,184,432) (765,499) (1,855,644)
Treasury stock, at cost;
171,921, 16,621 and 16,612
shares (1,505,678) (100,087) (100,000)
------------ ------------ ------------
Total shareholders' equity 71,884,547 72,347,086 35,972,119
------------ ------------ ------------
$857,235,535 $702,763,981 $585,568,827
============ ============ ============
Omni Financial Services, Inc.
Consolidated Statements of Income
For the Three Months For the Six Months Ended
Ended June 30 June 30
----------------------- ------------------------
2007 2006 2007 2006
----------- ----------- ----------- ------------
(unaudited) (unaudited)
Interest income:
Interest and fees on
loans $16,094,579 $10,546,717 $30,448,850 $ 19,190,317
Interest on
investment
securities 1,994,899 1,475,502 3,826,089 2,830,142
----------- ----------- ----------- ------------
Total interest
income 18,089,478 12,022,219 34,274,939 22,020,459
----------- ----------- ----------- ------------
Interest expense:
Interest on deposits 7,584,277 3,999,573 14,343,583 7,326,849
Interest on other
borrowings 1,271,419 1,569,782 2,261,947 2,679,369
----------- ----------- ----------- ------------
Total interest
expense 8,855,696 5,569,355 16,605,530 10,006,218
----------- ----------- ----------- ------------
Net interest income 9,233,782 6,452,864 17,669,409 12,014,241
Provision for loan
losses 1,441,019 725,000 2,426,798 950,000
----------- ----------- ----------- ------------
Net interest income
after provision for
loan losses 7,792,763 5,727,864 15,242,611 11,064,241
----------- ----------- ----------- ------------
Noninterest income:
Gain on sale of loans 204,442 236,483 302,767 716,790
Service charges on
deposit accounts 164,656 205,431 322,652 341,645
Investment securities
(losses) gains, net 9,803 (3,834) 8,674 (2,258)
Other income 483,294 116,745 863,835 342,419
----------- ----------- ----------- ------------
Total noninterest
income 862,195 554,825 1,497,928 1,398,596
----------- ----------- ----------- ------------
Noninterest Expense:
Salaries and employee
benefits 2,966,722 2,120,153 5,972,570 4,160,320
Occupancy and
equipment 877,053 695,160 1,729,227 1,365,287
Professional fees 371,043 254,725 705,451 616,010
Other real estate
owned expense 397,019 119,963 822,043 225,939
Telecommunications 165,137 139,187 349,567 284,975
Advertising and
marketing 171,349 108,831 326,501 247,772
Office supplies 92,207 75,098 178,148 141,940
Other 1,039,446 674,633 1,937,832 1,367,329
----------- ----------- ----------- ------------
Total noninterest
expense 6,079,976 4,187,750 12,021,339 8,409,572
----------- ----------- ----------- ------------
Income before income
taxes 2,574,982 2,094,939 4,719,200 4,053,265
Income tax expense
(benefit) 868,104 687,455 1,559,874 (2,362,873)
----------- ----------- ----------- ------------
Net income $ 1,706,878 $ 1,407,484 $ 3,159,326 $ 6,416,138
----------- ----------- ----------- ------------
Proforma data: (1)
Net income:
As reported $ 1,706,878 $ 1,407,484 $ 3,159,326 $ 6,416,138
Adjustment for change
in tax status - - $(3,691,407)
----------- ----------- ----------- ------------
Adjusted net income $ 1,706,878 $ 1,407,484 $ 3,159,326 $ 2,724,731
=========== =========== =========== ============
Earnings per common
share:
Basic $ 0.15 $ 0.19 $ 0.28 $ 0.87
Diluted $ 0.15 $ 0.18 $ 0.28 $ 0.85
Proforma Earnings per
common share: (1)
Basic earnings per
share $ 0.15 $ 0.19 $ 0.28 $ 0.37
Diluted earnings per
share $ 0.15 $ 0.18 $ 0.28 $ 0.36
Weighted average
common shares
outstanding:
Basic 11,280,687 7,476,366 11,307,100 7,353,258
Diluted 11,413,877 7,638,883 11,454,299 7,515,774
(1)The six months ended June 30, 2006 has been adjusted to reflect the
$3.69 M tax credit related to our conversion from an S-Corporation to
a C-Corporation, recognized on January 1, 2006.
----------------------------------------------------------------------
Omni Financial Services, Inc.
Selected Financial Data
For the Three Months Ended For the Six Months Ended
June 30 June 30
--------------------------- ---------------------------
2007 2006 2007 2006
------------- ------------- ------------- -------------
(unaudited) (unaudited)
Share Data
Common
shares
outstanding 11,218,148 7,476,366 11,218,148 7,476,366
Weighted
average
shares
outstanding
- basic 11,280,687 7,476,366 11,307,100 7,353,258
Weighted
average
shares
outstanding
- diluted 11,413,877 7,638,883 11,454,299 7,515,774
Book value at
quarter end $ 6.41 $ 4.80 $ 6.41 $ 4.80
Tangible book
value at
quarter end $ 5.89 $ 4.03 $ 5.89 $ 4.03
Basic earnings
per
share/GAAP $ 0.15 $ 0.19 $ 0.28 $ 0.87
Diluted
earnings per
share/GAAP $ 0.15 $ 0.18 $ 0.28 $ 0.85
Basic earnings
per
share/Pro-
forma (1) $ 0.15 $ 0.19 $ 0.28 $ 0.37
Diluted
earnings per
share/Pro-
forma (1) $ 0.15 $ 0.18 $ 0.28 $ 0.36
Cash dividends
declared $ 0.05 $ 0.11 $ 0.10 $ 0.17
Performance
Ratios:
Return on
average
assets/Pro-
forma (1) (2) 0.85% 1.00% 0.83% 1.04%
Return on
average
equity/Pro-
forma (1) (2) 9.25% 15.83% 8.66% 15.69%
Return on
average
tangible
equity/Pro-
forma (1) (2) 10.04% 18.92% 9.40% 18.81%
Yield on
earning
assets 9.77% 9.31% 9.67% 9.09%
Cost of
interest-
bearing
liabilities 5.22% 4.53% 5.17% 4.36%
Net interest
Margin 5.02% 5.06% 5.01% 5.01%
Efficiency
ratio 60.22% 59.76% 62.72% 62.70%
Return on
average
assets/GAAP
(2) 0.85% 1.00% 0.83% 2.44%
Return on
average
equity/GAAP
(2) 9.25% 15.83% 8.66% 36.94%
Return on
average
tangible
equity/GAAP
(2) 10.04% 18.92% 9.40% 44.30%
Credit Quality
Ratios:
Allowance for
loan losses $ 8,561,083 $ 5,544,038 $ 8,561,083 $ 5,544,038
Nonperforming
assets $ 14,951,283 $ 6,683,195 $ 14,951,283 $ 6,683,195
Allowance for
loan losses
to loans 1.40% 1.32% 1.40% 1.32%
Nonperforming
assets to
total assets 1.74% 1.19% 1.74% 1.19%
Nonperforming
assets to
total loans
and Oreo 2.42% 1.58% 2.42% 1.58%
Net charge-
offs $ 456 $ 174 $ 512 $ 197
Net charge-
offs to
average
loans (2) 0.31% 0.18% 0.18% 0.11%
Average
Balances:
Loans
outstanding $585,922,266 $397,518,592 $561,964,567 $368,844,315
Total assets $802,534,768 $562,571,304 $768,147,016 $529,836,306
Interest-
earning
assets $748,415,943 $524,924,386 $718,920,830 $494,468,429
Deposits $620,400,496 $399,348,478 $593,683,745 $380,289,702
Tangible
shareholders
equity $ 68,217,130 $ 29,842,787 $ 67,781,725 $ 29,206,587
Shareholders'
equity $ 74,005,291 $ 35,658,426 $ 73,570,177 $ 35,024,206
(1)The six-month period ended June 30, 2006 has been adjusted to
reflect the $3.69 million tax credit related to our conversion from
an S-Corporation to a C-Corporation, recognized on January 1, 2006.
(2)Annualized
----------------------------------------------------------------------
Loan Supplementary Information
The following schedules provide additional loan and non performing asset information as of June 30, 2007.
Non performing assets by loan type.
June 30, 2007 March 31, 2007
-------------------------- --------------------------
Non- Non-
performing performing
Loans Loans OREO Loans Loans OREO
-------- ----------------- -------- -----------------
Real estate -
construction $ 70,840 $ 2,390 $1,999 $ 74,531 $ 261 $ -
Community
redevelopment $174,814 $ 2,569 $3,143 156,863 3,566 4,402
Commercial real
estate $222,585 $ 2,942 $ 32 199,595 1,621 132.0
Residential real
estate $ 18,386 $ 400 $ 132 19,226 425 704
Commercial and
industrial $123,256 $ 1,344 $ - 119,188 544 -
Consumer $ 2,614 $ - $ - 2,346 35 -
------------------- -------------------------- ------
Total loans and
Oreo $612,495 $ 9,645 $5,306 571,750 6,452 5,238
=================== ========================== ======
Less: Allowance
for loan losses $ 8,561 $ - $ - 7,576 - -
Deferred
loan
fees, net $ 1,964 $ - $ - 1,795 - -
------------------- -------------------------- ------
Total net loans
and Oreo $601,970 $ 9,645 $5,306 $562,379 $ 6,452 $5,238
=================== ========================== ======
December 31, 2006
--------------------------
Loans Non- OREO
performing
Loans
--------------------------
Real estate -
construction $ 61,768 $ - $ -
Community
redevelopment 132,162 1,919 2,508
Commercial real
estate 184,015 1,961 -
Residential
real estate 20,254 411 870
Commercial and
industrial 102,018 874 -
Consumer 2,375 7 -
------------------- ------
Total loans and
Oreo 502,590 5,172 3,378
=================== ======
Less: Allowance
for loan
losses 6,646 -
Deferred
loan
fees,
net 1,130 -
------------------- ------
Total net loans
and Oreo $494,814 $ 5,172 $3,378
=================== ======
Non performing assets as a percentage of loan type.
June 30, 2007
---------------------------------------
Total as
a % of
Non- Total as % Gross
performing of Loans
loans OREO Product and OREO
---------------------------------------
Real estate - construction 3.28% 2.74% 6.03% 0.71%
Community redevelopment 1.44% 1.77% 3.21% 0.92%
Commercial real estate 1.32% 0.01% 1.34% 0.48%
Residential real estate 2.16% 0.71% 2.87% 0.09%
Commercial and industrial 1.09% 0.00% 1.09% 0.22%
Consumer 0.00% 0.00% 0.00% 0.00%
Total Non-Performers 1.56% 0.86% 2.42%
---------------------------------------
March 31, 2007
---------------------------------------
Total as
a % of
Non- Total as % Gross
performing of Loans
loans OREO Product and OREO
---------------------------------------
Real estate - construction 0.35% - 0.35% 0.05%
Community redevelopment 2.21% 2.73% 4.94% 1.38%
Commercial real estate 0.81% 0.07% 0.88% 0.30%
Residential real estate 2.13% 3.53% 5.67% 0.20%
Commercial and industrial 0.46% - 0.46% 0.09%
Consumer 1.49% - 1.49% 0.01%
Total Non-Performers 1.12% 0.91% 2.03%
---------------------------------------
December 31, 2006
---------------------------------------
Total as
a % of
Non- Total as % Gross
performing of Loans
loans OREO Product and OREO
---------------------------------------
Real estate - construction - - - 0.00%
Community redevelopment 1.42% 1.86% 3.29% 0.87%
Commercial real estate 1.07% - 1.07% 0.39%
Residential real estate 1.95% 4.12% 6.06% 0.25%
Commercial and industrial 0.86% - 0.86% 0.18%
Consumer 0.29% - 0.29% 0.00%
Total Non-Performers 1.02% 0.67% 1.69%
---------------------------------------
Non-performing loans include non-accrual loans and accruing loans past
due greater than 90 days
----------------------------------------------------------------------
Non performing asset with collateral type.
Non accrual OREO Total
loans
---------------- ---------------- -----------------
Units Value Units Value Units Value
---------------- ---------------- -----------------
Commercial loans/OREO
collateralized by residential
dwellings
-----------------------------------
Redevelopment
Atlanta 7 $ 766,140 10 $1,094,515 17 $ 1,860,655
Macon - - 24 1,128,223 24 1,128,223
Griffin - - 10 426,930 10 426,930
Charlotte 1 320,382 3 152,967 4 473,349
Birmingham 2 68,613 2 84,696 4 153,309
Tampa 4 454,606 2 255,998 6 710,605
Chicago 7 1,279,656 - - 7 1,279,656
---------------------------------------------------
21 2,889,397 51 3,143,329 72 6,032,727
Atlanta Commercial 4 730,083 7 1,268,193 11 1,998,276
North Carolina
Commercial 4 149,824 4 131,513 8 281,337
---------------------------------------------------
29 3,769,304 62 4,543,035 91 8,312,339
Commercial loans
collateralized by
residential lots
-------------------
Atlanta Commercial 65 2,931,771 21 731,248 86 3,663,019
Loans/OREO
collateralized by other
than residential
property
------------------------
SBA 5 905,453 - - 5 905,453
Leasing, equipment
and other 11 1,123,801 1 32,000 12 1,155,801
Commercial real
estate 1 562,606 - - 1 562,606
Atlanta Consumer 2 309,311 - - 2 309,311
North Carolina
consumer 1 42,753 - - 1 42,753
---------------------------------------------------
20 2,943,924 1 32,000 21 2,975,924
Aggregate non-
performing loans
and OREO 114 $9,644,999 84 $5,306,283 198 $14,951,283
----------------------------------------------------------------------
Commercial residential real estate performing loan portfolio - collateral and loan type.
Land-
Acquisition Multi-
Land - & Family
Unimproved Development Dwelling
Georgia
Total Loans $ 3,245,945 $ 7,848,760 $ 90,385
Number of units of raw land 11 11 -
Number of lots 2 - -
Number of condo/town home
units - - -
Number of single family
residences - - -
North Carolina
Total Loans $ 3,026,580 $ 2,992,508 $ -
Number of units of raw land 12 3 -
Number of lots 8 4 -
Number of condo/town home
units - 1 -
Number of single family
residences - - -
Other
Total Loans $ 5,574,927 $ 1,453,694 $4,864,736
Number of units of raw land 2 2 -
Number of lots - - -
Number of condo/town home
units - - 2
Number of single family
residences - - -
Total
Total Loans $11,847,452 $ 12,294,962 $4,955,121
Number of units of raw land 25 16 -
Number of lots 10 4 -
Number of condo/town home
units - 1 2
Number of single family
residences - - -
The above collateral information is based on information provided
as part of the related loan documentation process. The actual
number of lots may have changed during the development process
Residential
Construction Grand Total
Georgia
Total Loans $ 31,969,427 $43,154,516
Number of units of raw land - 22
Number of lots 138 140
Number of condo/town home units 2 2
Number of single family residences 29 29
North Carolina
Total Loans $ 14,020,225 $20,039,313
Number of units of raw land 2 17
Number of lots 72 84
Number of condo/town home units - 1
Number of single family residences 39 39
Other
Total Loans $ 5,022,661 $16,916,019
Number of units of raw land - 4
Number of lots 3 3
Number of condo/town home units 2 4
Number of single family residences - -
Total
Total Loans $ 51,012,313 $80,109,848
Number of units of raw land $ 2 43
Number of lots $ 213 227
Number of condo/town home units $ 4 7
Number of single family residences $ 68 68
The above collateral information is based on information provided
as part of the related loan documentation process. The actual
number of lots may have changed during the development process
Source: Omni Financial Services, Inc.
----------------------------------------------
Omni Financial Services
Inc.
Connie Perrine
404-250-7745
Chief Financial Officer
Jul 25, 2007 9:21:00 AM
Copyright Business Wire 2007
ATLANTA--(BUSINESS WIRE)--
Omni Financial Services, Inc. (NASDAQ: OFSI):
Second Quarter 2007 Highlights (compared to June 30, 2006 unless otherwise noted):
-- Net income of $1.71 million - increase of 21.3%
-- Diluted earnings per share of $0.15
-- Total capital of $71.9 million - increase of 99.8%
-- Asset growth of $271.7 million - increase of 46.4%
-- Net interest margin of 5.02% - 4 basis point linked quarter
increase
-- Dividend of $0.05 per share declared
Financial Performance
Omni Financial Services, Inc. (NASDAQ: OFSI), the bank holding company for Omni National Bank, reported an increase of 21.3% in net income for the three months ended June 30, 2007, to $1.7 million or $0.15 per diluted share, compared to $1.4 million or $0.18 per diluted share in the same quarter in 2006. Comparing linked quarters, net income increased 17.5% or $0.02 per diluted share, from the first quarter of 2007. For the six months ended June 30, 2007 the Company posted net income of $3.2 million or $0.28 per diluted share, which is a net income increase of 15.9% as compared to $2.7 million or $0.36 for the six month period ended June 30, 2006. For comparison purposes, net income for the six months ended June 30, 2006 has been reduced by a $3.69 million tax credit recorded on January 1, 2006 upon conversion from an S-Corporation to a C-Corporation at January 1, 2006. Including the tax credit, net income calculated in accordance with generally accepted accounting principles ("GAAP") for the six months ended June 30, 2006 was $6.4 million or $0.85 per diluted share.
The primary reason for the increase in earnings during 2007 is expansion in net interest income, which was driven by a $193.1 million or 52% increase in average loans outstanding for the six months ended June 30, 2007 as compared to the six months ended June 30, 2006. Chairman and CEO Stephen Klein stated, "We are pleased that quarter after quarter we are able to produce record earnings and consistent loan growth for our shareholders." Earnings for the quarter were also positively impacted by the May 2007 recovery of $357,000 relating to a $1.0 million fraud loss recorded in December 2005 in the warehouse lending line of business. President Irwin Berman noted, "Our diligence in pursuing this matter has resulted in the recovery of 35% of the loss previously recognized. While further recovery remains uncertain, we continue to pursue our options."
Net Interest Income and Margin
For the three months ended June 30, 2007, the Company recorded record net interest income of $9.2 million, an increase of $2.78 million or 43.1% from $6.5 million for the same period in 2006, the result of continued strong loan growth which drove the increase in average earning assets of $223.5 million or 42.6% when compared to the same period in 2006. Compared to the first quarter of 2007, net interest income increased $847,000 or 10.10%.
The Company's net interest margin for the quarter was 5.02%, which was four basis points below second quarter 2006 but an increase of 4 basis points from the quarter ended March 31, 2007.
Loans
Loans, net of deferred loan fees, were $610.5 million at June 30, 2007, an increase of $189.2 million or 44.9% when compared to $421.3 million at June 30, 2006. On a linked-quarter basis, gross loans grew $40.6 million or 7.1% over the prior quarter. For the quarter ended June 30, 2007, net charge-offs totaled $456,000, resulting in an annualized net charge-off ratio of 0.31% compared to $174,000 or 0.18% for the quarter ended June 30, 2006 and $56,000 or 0.04% for the linked quarter. Approximately $175,000 or 38% of the net charge-offs related to losses recognized for properties in Griffin and Macon, Georgia that were foreclosed and taken into OREO during the quarter. During the first quarter of 2007 the Company noted that an accelerated economic downturn in these markets had increased non performing assets. An additional $146,000 or 32% of the net charge-offs arose from losses recognized on the liquidation of collateral related to two loans acquired in the Company's July 2005 acquisition of a troubled Dalton Georgia bank.
On a linked quarter basis, the provision for loan losses increased $455,000 or 46%. $424,000 of the increase was attributable to specific reserves related to two loans for which the Company has identified a probable incurred loss. The ratio of the allowance for loan losses to loans increased from 1.33% to 1.40%. Without the specific reserves noted, the ratio would have been 1.33%. The provision for loan losses for the three months ended June 30, 2006 was $725,000 and the ratio of the allowance for loan losses to loans was 1.32%. The $716,000 or 99% year over year increase in the provision reflects the Bank's significant loan growth.
Total non-performing assets as a percentage of total loans and OREO increased to 2.42% as of June 30, 2007 compared to 2.03% as of March 31, 2007 and 1.64% as of June 30, 2006. While there was a large reduction in non-performing assets in the community redevelopment portfolio to 0.92% of loans and OREO, from 1.38% of loans and OREO as of March 31, 2007, there was an increase in non-performing assets in the Atlanta real estate construction portfolio (to 0.71% of loans and OREO from 0.05%) due to credit deterioration detected in 5 metro Atlanta residential construction relationships, totaling $5.4 million. "We have been proactive in facing the loan performance challenges that we have seen and may continue to see in the industry, and believe we have a strong team in place to manage the resulting opportunities," Chief Lending Officer Charlie Barnwell commented. "We continue to evaluate market data as it relates to residential housing absorption, and in particular, building lot absorption and sales so that we can identify potential issues and work with our borrowers to avoid default."
Financial Ratios
Certain performance ratios for the quarter ended June 30, 2007 compared to the quarter ended June, 2006 have been significantly impacted by the large increase in stockholders' equity and shares outstanding associated with the Company's initial public offering that was effective September 29, 2006 and was consummated in the fourth quarter of 2006. As a result of the offering, shares outstanding increased by 3,852,500 and net proceeds of $33.0 million were received. The increase in these items resulted in the denominators used in calculating certain ratios to increase, which resulted in reduced ratios for the current quarter, specifically for return on equity and earnings per share. As the proceeds from the offering are utilized in the growth of the business it is expected that the performance ratios will continue to increase and return to historical levels.
Return on average equity for the three months ended June 30, 2007 was 9.25% compared to 15.83% for the same period in 2006. Return on average assets for the three months ended June 30, 2007 was 0.85% compared to 1.00% for the same period in 2006. The Company's efficiency ratio (non-interest expense divided by the sum of net interest income and non-interest income) was 60.22% for the three months ended June 30, 2007 compared to 59.76% for the three months ended June 30, 2006.
On a linked quarter basis, return on average equity and assets improved from 8.05% and 0.79% to 9.25% and 0.85%, respectively, as more of the capital raised in 2006 has been deployed and begun to produce a return. Also on a linked quarter basis, there was improvement in the efficiency ratio from 65.50% to 60.22%.
Selected Financial Information
For the Three Months Ended June 30
-----------------------------------
2007 2006 % Change
------------ ------------ ---------
Share Data
Diluted earnings per share (1) $ 0.15 $ 0.18 -16.67%
Book value at period end $ 6.41 $ 4.80 33.50%
Tangible book value at period end $ 5.89 $ 4.03 46.18%
Performance Ratios:
Return on average equity (1) (2) 9.25% 15.83% -41.57%
Net interest margin 5.02% 5.06% -0.88%
Efficiency ratio 60.22% 59.76% 0.77%
Credit Quality Ratios:
Allowance for loan losses to loans 1.40% 1.32% 6.06%
Nonperforming assets to total
assets 1.74% 1.19% 46.57%
Nonperforming assets to total loans
and Oreo 2.42% 1.58% 53.22%
Net charge-offs to average loans
(2) 0.31% 0.18% 72.22%
Selected Balance Sheet Averages:
Loans outstanding $585,922,266 $397,518,592 47.39%
Total assets $802,534,768 $562,571,304 42.65%
Interest-earning assets $748,415,943 $524,924,386 42.58%
Deposits $620,400,496 $399,348,478 55.35%
Tangible shareholders equity $ 68,217,130 $ 29,842,787 128.59%
Shareholders' equity $ 74,005,291 $ 35,658,426 107.54%
(1)The six month period ended June 30, 2006 has been adjusted to
reflect the $3.69 million tax credit related to our conversion from
an S-Corporation to a C-Corporation, recognized on January 1, 2006.
(2)Annualized
----------------------------------------------------------------------
For the Six Months Ended June 30
----------------------------------
2007 2006 % Change
------------ ------------ --------
Share Data
Diluted earnings per share (1) $ 0.28 $ 0.36 -22.22%
Book value at period end $ 6.41 $ 4.80 33.50%
Tangible book value at period end $ 5.89 $ 4.03 46.18%
Performance Ratios:
Return on average equity (1) (2) 8.66% 36.94% -76.56%
Net interest margin 5.01% 5.01% 0.01%
Efficiency ratio 62.72% 62.70% 0.03%
Credit Quality Ratios:
Allowance for loan losses to loans 1.40% 1.32% 6.06%
Nonperforming assets to total
assets 1.74% 1.19% 46.57%
Nonperforming assets to total
loans and Oreo 2.42% 1.58% 53.22%
Net charge-offs to average loans
(2) 0.18% 0.11% 63.64%
Selected Balance Sheet Averages:
Loans outstanding $561,964,567 $368,844,315 52.36%
Total assets $768,147,016 $529,836,306 44.98%
Interest-earning assets $718,920,830 $494,468,429 45.39%
Deposits $593,683,745 $380,289,702 56.11%
Tangible shareholders equity $ 67,781,725 $ 29,206,587 132.08%
Shareholders' equity $ 73,570,177 $ 35,024,206 110.06%
(1)The six month period ended June 30, 2006 has been adjusted to
reflect the $3.69 million tax credit related to our conversion from
an S-Corporation to a C-Corporation, recognized on January 1, 2006.
(2)Annualized
---------------------------------------------------------------------
Expansion Activities
During the second quarter, the Company continued its expansion activities. In April it celebrated the grand opening of a new Fayetteville, North Carolina branch, located on the north side of town and relocated the Dalton, Georgia branch to a new downtown location. The Company also expanded its geographic diversity by opening a loan production office in Dallas, Texas and entering into an agreement to acquire the charter of Wilson State Bank. The charter acquisition, which closed July 2, 2007, will allow the Company to provide full service banking in Dallas as well as expand full service banking throughout Texas. A Houston office is expected to open in the third quarter of 2007. The Company also acquired an office building in downtown Chicago, Illinois with the intent to increase its Chicago presence.
Like most financial institutions, the Bank continues to focus on core deposit growth. President Irwin Berman stated, "Although growing demand deposits continues to be a challenge, we are pleased with the growth of our money market and savings deposits which increased $32 million - more than 100% - since June 2006."
To support the continued growth, the Company added 15 new associates during the quarter. One area of focus was the Credit Administration area which added 4 employees. Chief Credit Officer Terry Lawson noted, "The additions to our Credit area further strengthen our already stringent credit culture."
Other Information
Quarterly Dividend. The board of directors declared a quarterly cash dividend of $0.05 per share at its July 24, 2007 board meeting. The dividend is payable on August 21, 2007 to shareholders of record as of August 6, 2007.
Stock Repurchase Program. On July 24, 2007, the board of directors authorized the Company to increase the aggregate size of its existing stock repurchase program by $8.6 million to provide for the repurchase of an aggregate of $10 million of stock, of which $1.4 million has been repurchased. The closing price of Omni Financial Services, Inc. common stock on June 29, 2007 (the last trading day of the quarter) was $8.12 per share.
The Georgia 100--Best of Business 2007. Omni Financial Services was ranked #27 in the Georgia 100, the Atlanta Journal-Constitution's annual list of Georgia's top 100 public companies based on 2006 performance. Rankings are computed by an independent accounting firm and are based on five weighted variables: annual revenue, year-over-year revenue change, return on equity, annual change in profit margin in fiscal 2006 and total return on investment (share price change plus reinvested dividends) for calendar 2006.
Conference Call / Webcast Information
Omni Financial Services, Inc. will host a conference call on Thursday, July 26 at 10:00 a.m. (ET) to discuss second quarter 2007 financial results. Additional material information, including forward-looking statements such as trends and projections, may be discussed during the presentation. To participate in the conference call or webcast, please follow the instructions listed below.
Conference Call: Please call 1-866-558-6901. A transcript of the call will be available 3 days after the event on the Company's website and will be available for 14 days following the event.
Webcast: To gain access to the webcast, which will be "listen-only," please go to www.onb.com and click on the link "Earnings Press Release." For those unable to participate during the live webcast, it will be archived on the Omni National Bank website for 14 days following the event.
About Omni
Omni Financial Services, Inc. is a bank holding company headquartered in Atlanta, Georgia. Omni Financial Services, Inc. provides a full range of banking and related services through its wholly owned subsidiary, Omni National Bank, a national bank headquartered in Atlanta, Georgia. Omni has one full service banking location in Atlanta, one in Dalton, Georgia, five in North Carolina, one in Chicago, Illinois, and one in Tampa, Florida. In addition, Omni has loan production offices in Charlotte, North Carolina, Dalton, Georgia, Birmingham, Alabama, Philadelphia, Pennsylvania, and Dallas, Texas. Omni provides traditional lending and deposit gathering capabilities, as well as a broad array of financial products and services, including specialized services such as community redevelopment lending, small business lending and equipment leasing, warehouse lending, and asset-based lending. Omni Financial Services, Inc.'s common stock is traded on the NASDAQ Global Market under the ticker symbol "OFSI." Additional information about Omni National Bank is available on its website at www.onb.com.
Except for historical information contained herein, the matters discussed in this press release consist of forward-looking information under the Private Securities Litigation Reform Act of 1995. The accuracy of the forward-looking information is necessarily subject to and involves risks and uncertainties, which could cause actual results to differ materially from the forward-looking information. These risks and uncertainties include, but are not limited to, unforeseen general economic conditions, potential difficulties in the execution of Omni Financial Services, Inc.'s business and growth strategies, competitive risks and other factors set forth from time to time in Omni Financial Services, Inc.'s filings with the Securities and Exchange Commission. When used in this release, the words "believes," "estimates," "plans," "expects," "should," "will," "may," "might," "outlook," and "anticipates" are similar expressions as they relate to Omni Financial Services, Inc.'s (including its subsidiaries), or its management, and are intended to identify forward-looking statements.
Omni Financial Services, Inc. from time to time becomes aware of rumors concerning its business, prospects and results of operations. As a matter of policy, Omni Financial Services, Inc. does not comment on rumors. Investors are cautioned that in this age of instant communication and Internet access, it may be important to avoid relying on rumors and other unsubstantiated information. Omni Financial Services, Inc. complies with federal and state laws applicable to the disclosure of information concerning its business, prospects and results of operations. Investors may be at significant risk in relying on unsubstantiated information from other sources.
Omni Financial Services, Inc.
Consolidated Balance Sheets
ASSETS June 30, December 31, June 30,
2007 2006 2006
------------ ------------ ------------
(unaudited) (unaudited)
Cash and due from banks $ 7,297,232 $ 5,874,453 $ 6,750,183
Interest-bearing deposits in
other financial institutions 2,126,795 319,961 1,906,400
Federal funds sold 37,827,000 16,341,000 -
------------ ------------ ------------
Total cash and cash
equivalents 47,251,027 22,535,414 8,656,583
Investment securities
available-for-sale 140,527,523 134,553,978 118,685,155
Other investments 5,927,500 4,836,100 6,388,600
Loans, net of allowance for
loan losses of $8,561,083,
$6,646,212, and $5,544,038 601,971,083 494,813,672 415,802,060
Loans held-for-sale 5,482,945 9,635,243 3,728,157
Equipment leased to others 3,053,399 - 27,112
Other real estate owned 5,306,283 3,377,719 1,786,917
Premises and equipment, net 22,714,099 10,707,034 11,912,047
Goodwill 4,753,887 4,753,887 4,753,887
Cash surrender value of life
insurance policies 1,225,236 1,201,275 1,177,489
Accrued interest and loan
related receivable 9,024,168 5,904,039 4,210,308
Deferred taxes 5,252,473 3,461,111 4,238,328
Other assets 4,745,912 6,984,509 4,202,184
------------ ------------ ------------
$857,235,535 $702,763,981 $585,568,827
============ ============ ============
LIABILITIES & STOCKHOLDERS'
EQUITY
Deposits:
Demand $ 44,722,493 $ 49,380,211 $ 41,009,788
Savings and money market 46,337,209 36,993,065 13,842,909
Certificates of deposit -
Retail 174,435,896 162,293,149 175,445,108
Certificates of deposit -
Brokered 411,592,611 296,003,247 198,013,438
------------ ------------ ------------
Total deposits 677,088,209 544,669,672 428,311,243
Federal Home Loan Bank
borrowings 77,500,000 57,500,000 92,000,000
Junior subordinated debentures 20,620,000 20,620,000 20,620,000
Federal funds purchased - - 1,842,000
Deferred gain on sale of OREO 702,668 576,808 315,875
Escrow accounts, accrued
interest payable and other
liabilities 9,440,111 7,050,415 6,507,590
------------ ------------ ------------
Total liabilities 785,350,988 630,416,895 549,596,708
Common stock, par value $1.00;
25,000,000 shares authorized:
11,390,069, 11,348,928,
7,492,978 shares issued;
11,218,148, 11,332,307,
7,492,977 outstanding 11,390,069 11,348,928 7,492,978
Additional paid-in capital 54,863,563 54,567,172 25,276,224
Retained earnings 9,321,025 7,296,572 5,158,561
Accumulated other comprehensive
loss (2,184,432) (765,499) (1,855,644)
Treasury stock, at cost;
171,921, 16,621 and 16,612
shares (1,505,678) (100,087) (100,000)
------------ ------------ ------------
Total shareholders' equity 71,884,547 72,347,086 35,972,119
------------ ------------ ------------
$857,235,535 $702,763,981 $585,568,827
============ ============ ============
Omni Financial Services, Inc.
Consolidated Statements of Income
For the Three Months For the Six Months Ended
Ended June 30 June 30
----------------------- ------------------------
2007 2006 2007 2006
----------- ----------- ----------- ------------
(unaudited) (unaudited)
Interest income:
Interest and fees on
loans $16,094,579 $10,546,717 $30,448,850 $ 19,190,317
Interest on
investment
securities 1,994,899 1,475,502 3,826,089 2,830,142
----------- ----------- ----------- ------------
Total interest
income 18,089,478 12,022,219 34,274,939 22,020,459
----------- ----------- ----------- ------------
Interest expense:
Interest on deposits 7,584,277 3,999,573 14,343,583 7,326,849
Interest on other
borrowings 1,271,419 1,569,782 2,261,947 2,679,369
----------- ----------- ----------- ------------
Total interest
expense 8,855,696 5,569,355 16,605,530 10,006,218
----------- ----------- ----------- ------------
Net interest income 9,233,782 6,452,864 17,669,409 12,014,241
Provision for loan
losses 1,441,019 725,000 2,426,798 950,000
----------- ----------- ----------- ------------
Net interest income
after provision for
loan losses 7,792,763 5,727,864 15,242,611 11,064,241
----------- ----------- ----------- ------------
Noninterest income:
Gain on sale of loans 204,442 236,483 302,767 716,790
Service charges on
deposit accounts 164,656 205,431 322,652 341,645
Investment securities
(losses) gains, net 9,803 (3,834) 8,674 (2,258)
Other income 483,294 116,745 863,835 342,419
----------- ----------- ----------- ------------
Total noninterest
income 862,195 554,825 1,497,928 1,398,596
----------- ----------- ----------- ------------
Noninterest Expense:
Salaries and employee
benefits 2,966,722 2,120,153 5,972,570 4,160,320
Occupancy and
equipment 877,053 695,160 1,729,227 1,365,287
Professional fees 371,043 254,725 705,451 616,010
Other real estate
owned expense 397,019 119,963 822,043 225,939
Telecommunications 165,137 139,187 349,567 284,975
Advertising and
marketing 171,349 108,831 326,501 247,772
Office supplies 92,207 75,098 178,148 141,940
Other 1,039,446 674,633 1,937,832 1,367,329
----------- ----------- ----------- ------------
Total noninterest
expense 6,079,976 4,187,750 12,021,339 8,409,572
----------- ----------- ----------- ------------
Income before income
taxes 2,574,982 2,094,939 4,719,200 4,053,265
Income tax expense
(benefit) 868,104 687,455 1,559,874 (2,362,873)
----------- ----------- ----------- ------------
Net income $ 1,706,878 $ 1,407,484 $ 3,159,326 $ 6,416,138
----------- ----------- ----------- ------------
Proforma data: (1)
Net income:
As reported $ 1,706,878 $ 1,407,484 $ 3,159,326 $ 6,416,138
Adjustment for change
in tax status - - $(3,691,407)
----------- ----------- ----------- ------------
Adjusted net income $ 1,706,878 $ 1,407,484 $ 3,159,326 $ 2,724,731
=========== =========== =========== ============
Earnings per common
share:
Basic $ 0.15 $ 0.19 $ 0.28 $ 0.87
Diluted $ 0.15 $ 0.18 $ 0.28 $ 0.85
Proforma Earnings per
common share: (1)
Basic earnings per
share $ 0.15 $ 0.19 $ 0.28 $ 0.37
Diluted earnings per
share $ 0.15 $ 0.18 $ 0.28 $ 0.36
Weighted average
common shares
outstanding:
Basic 11,280,687 7,476,366 11,307,100 7,353,258
Diluted 11,413,877 7,638,883 11,454,299 7,515,774
(1)The six months ended June 30, 2006 has been adjusted to reflect the
$3.69 M tax credit related to our conversion from an S-Corporation to
a C-Corporation, recognized on January 1, 2006.
----------------------------------------------------------------------
Omni Financial Services, Inc.
Selected Financial Data
For the Three Months Ended For the Six Months Ended
June 30 June 30
--------------------------- ---------------------------
2007 2006 2007 2006
------------- ------------- ------------- -------------
(unaudited) (unaudited)
Share Data
Common
shares
outstanding 11,218,148 7,476,366 11,218,148 7,476,366
Weighted
average
shares
outstanding
- basic 11,280,687 7,476,366 11,307,100 7,353,258
Weighted
average
shares
outstanding
- diluted 11,413,877 7,638,883 11,454,299 7,515,774
Book value at
quarter end $ 6.41 $ 4.80 $ 6.41 $ 4.80
Tangible book
value at
quarter end $ 5.89 $ 4.03 $ 5.89 $ 4.03
Basic earnings
per
share/GAAP $ 0.15 $ 0.19 $ 0.28 $ 0.87
Diluted
earnings per
share/GAAP $ 0.15 $ 0.18 $ 0.28 $ 0.85
Basic earnings
per
share/Pro-
forma (1) $ 0.15 $ 0.19 $ 0.28 $ 0.37
Diluted
earnings per
share/Pro-
forma (1) $ 0.15 $ 0.18 $ 0.28 $ 0.36
Cash dividends
declared $ 0.05 $ 0.11 $ 0.10 $ 0.17
Performance
Ratios:
Return on
average
assets/Pro-
forma (1) (2) 0.85% 1.00% 0.83% 1.04%
Return on
average
equity/Pro-
forma (1) (2) 9.25% 15.83% 8.66% 15.69%
Return on
average
tangible
equity/Pro-
forma (1) (2) 10.04% 18.92% 9.40% 18.81%
Yield on
earning
assets 9.77% 9.31% 9.67% 9.09%
Cost of
interest-
bearing
liabilities 5.22% 4.53% 5.17% 4.36%
Net interest
Margin 5.02% 5.06% 5.01% 5.01%
Efficiency
ratio 60.22% 59.76% 62.72% 62.70%
Return on
average
assets/GAAP
(2) 0.85% 1.00% 0.83% 2.44%
Return on
average
equity/GAAP
(2) 9.25% 15.83% 8.66% 36.94%
Return on
average
tangible
equity/GAAP
(2) 10.04% 18.92% 9.40% 44.30%
Credit Quality
Ratios:
Allowance for
loan losses $ 8,561,083 $ 5,544,038 $ 8,561,083 $ 5,544,038
Nonperforming
assets $ 14,951,283 $ 6,683,195 $ 14,951,283 $ 6,683,195
Allowance for
loan losses
to loans 1.40% 1.32% 1.40% 1.32%
Nonperforming
assets to
total assets 1.74% 1.19% 1.74% 1.19%
Nonperforming
assets to
total loans
and Oreo 2.42% 1.58% 2.42% 1.58%
Net charge-
offs $ 456 $ 174 $ 512 $ 197
Net charge-
offs to
average
loans (2) 0.31% 0.18% 0.18% 0.11%
Average
Balances:
Loans
outstanding $585,922,266 $397,518,592 $561,964,567 $368,844,315
Total assets $802,534,768 $562,571,304 $768,147,016 $529,836,306
Interest-
earning
assets $748,415,943 $524,924,386 $718,920,830 $494,468,429
Deposits $620,400,496 $399,348,478 $593,683,745 $380,289,702
Tangible
shareholders
equity $ 68,217,130 $ 29,842,787 $ 67,781,725 $ 29,206,587
Shareholders'
equity $ 74,005,291 $ 35,658,426 $ 73,570,177 $ 35,024,206
(1)The six-month period ended June 30, 2006 has been adjusted to
reflect the $3.69 million tax credit related to our conversion from
an S-Corporation to a C-Corporation, recognized on January 1, 2006.
(2)Annualized
----------------------------------------------------------------------
Loan Supplementary Information
The following schedules provide additional loan and non performing asset information as of June 30, 2007.
Non performing assets by loan type.
June 30, 2007 March 31, 2007
-------------------------- --------------------------
Non- Non-
performing performing
Loans Loans OREO Loans Loans OREO
-------- ----------------- -------- -----------------
Real estate -
construction $ 70,840 $ 2,390 $1,999 $ 74,531 $ 261 $ -
Community
redevelopment $174,814 $ 2,569 $3,143 156,863 3,566 4,402
Commercial real
estate $222,585 $ 2,942 $ 32 199,595 1,621 132.0
Residential real
estate $ 18,386 $ 400 $ 132 19,226 425 704
Commercial and
industrial $123,256 $ 1,344 $ - 119,188 544 -
Consumer $ 2,614 $ - $ - 2,346 35 -
------------------- -------------------------- ------
Total loans and
Oreo $612,495 $ 9,645 $5,306 571,750 6,452 5,238
=================== ========================== ======
Less: Allowance
for loan losses $ 8,561 $ - $ - 7,576 - -
Deferred
loan
fees, net $ 1,964 $ - $ - 1,795 - -
------------------- -------------------------- ------
Total net loans
and Oreo $601,970 $ 9,645 $5,306 $562,379 $ 6,452 $5,238
=================== ========================== ======
December 31, 2006
--------------------------
Loans Non- OREO
performing
Loans
--------------------------
Real estate -
construction $ 61,768 $ - $ -
Community
redevelopment 132,162 1,919 2,508
Commercial real
estate 184,015 1,961 -
Residential
real estate 20,254 411 870
Commercial and
industrial 102,018 874 -
Consumer 2,375 7 -
------------------- ------
Total loans and
Oreo 502,590 5,172 3,378
=================== ======
Less: Allowance
for loan
losses 6,646 -
Deferred
loan
fees,
net 1,130 -
------------------- ------
Total net loans
and Oreo $494,814 $ 5,172 $3,378
=================== ======
Non performing assets as a percentage of loan type.
June 30, 2007
---------------------------------------
Total as
a % of
Non- Total as % Gross
performing of Loans
loans OREO Product and OREO
---------------------------------------
Real estate - construction 3.28% 2.74% 6.03% 0.71%
Community redevelopment 1.44% 1.77% 3.21% 0.92%
Commercial real estate 1.32% 0.01% 1.34% 0.48%
Residential real estate 2.16% 0.71% 2.87% 0.09%
Commercial and industrial 1.09% 0.00% 1.09% 0.22%
Consumer 0.00% 0.00% 0.00% 0.00%
Total Non-Performers 1.56% 0.86% 2.42%
---------------------------------------
March 31, 2007
---------------------------------------
Total as
a % of
Non- Total as % Gross
performing of Loans
loans OREO Product and OREO
---------------------------------------
Real estate - construction 0.35% - 0.35% 0.05%
Community redevelopment 2.21% 2.73% 4.94% 1.38%
Commercial real estate 0.81% 0.07% 0.88% 0.30%
Residential real estate 2.13% 3.53% 5.67% 0.20%
Commercial and industrial 0.46% - 0.46% 0.09%
Consumer 1.49% - 1.49% 0.01%
Total Non-Performers 1.12% 0.91% 2.03%
---------------------------------------
December 31, 2006
---------------------------------------
Total as
a % of
Non- Total as % Gross
performing of Loans
loans OREO Product and OREO
---------------------------------------
Real estate - construction - - - 0.00%
Community redevelopment 1.42% 1.86% 3.29% 0.87%
Commercial real estate 1.07% - 1.07% 0.39%
Residential real estate 1.95% 4.12% 6.06% 0.25%
Commercial and industrial 0.86% - 0.86% 0.18%
Consumer 0.29% - 0.29% 0.00%
Total Non-Performers 1.02% 0.67% 1.69%
---------------------------------------
Non-performing loans include non-accrual loans and accruing loans past
due greater than 90 days
----------------------------------------------------------------------
Non performing asset with collateral type.
Non accrual OREO Total
loans
---------------- ---------------- -----------------
Units Value Units Value Units Value
---------------- ---------------- -----------------
Commercial loans/OREO
collateralized by residential
dwellings
-----------------------------------
Redevelopment
Atlanta 7 $ 766,140 10 $1,094,515 17 $ 1,860,655
Macon - - 24 1,128,223 24 1,128,223
Griffin - - 10 426,930 10 426,930
Charlotte 1 320,382 3 152,967 4 473,349
Birmingham 2 68,613 2 84,696 4 153,309
Tampa 4 454,606 2 255,998 6 710,605
Chicago 7 1,279,656 - - 7 1,279,656
---------------------------------------------------
21 2,889,397 51 3,143,329 72 6,032,727
Atlanta Commercial 4 730,083 7 1,268,193 11 1,998,276
North Carolina
Commercial 4 149,824 4 131,513 8 281,337
---------------------------------------------------
29 3,769,304 62 4,543,035 91 8,312,339
Commercial loans
collateralized by
residential lots
-------------------
Atlanta Commercial 65 2,931,771 21 731,248 86 3,663,019
Loans/OREO
collateralized by other
than residential
property
------------------------
SBA 5 905,453 - - 5 905,453
Leasing, equipment
and other 11 1,123,801 1 32,000 12 1,155,801
Commercial real
estate 1 562,606 - - 1 562,606
Atlanta Consumer 2 309,311 - - 2 309,311
North Carolina
consumer 1 42,753 - - 1 42,753
---------------------------------------------------
20 2,943,924 1 32,000 21 2,975,924
Aggregate non-
performing loans
and OREO 114 $9,644,999 84 $5,306,283 198 $14,951,283
----------------------------------------------------------------------
Commercial residential real estate performing loan portfolio - collateral and loan type.
Land-
Acquisition Multi-
Land - & Family
Unimproved Development Dwelling
Georgia
Total Loans $ 3,245,945 $ 7,848,760 $ 90,385
Number of units of raw land 11 11 -
Number of lots 2 - -
Number of condo/town home
units - - -
Number of single family
residences - - -
North Carolina
Total Loans $ 3,026,580 $ 2,992,508 $ -
Number of units of raw land 12 3 -
Number of lots 8 4 -
Number of condo/town home
units - 1 -
Number of single family
residences - - -
Other
Total Loans $ 5,574,927 $ 1,453,694 $4,864,736
Number of units of raw land 2 2 -
Number of lots - - -
Number of condo/town home
units - - 2
Number of single family
residences - - -
Total
Total Loans $11,847,452 $ 12,294,962 $4,955,121
Number of units of raw land 25 16 -
Number of lots 10 4 -
Number of condo/town home
units - 1 2
Number of single family
residences - - -
The above collateral information is based on information provided
as part of the related loan documentation process. The actual
number of lots may have changed during the development process
Residential
Construction Grand Total
Georgia
Total Loans $ 31,969,427 $43,154,516
Number of units of raw land - 22
Number of lots 138 140
Number of condo/town home units 2 2
Number of single family residences 29 29
North Carolina
Total Loans $ 14,020,225 $20,039,313
Number of units of raw land 2 17
Number of lots 72 84
Number of condo/town home units - 1
Number of single family residences 39 39
Other
Total Loans $ 5,022,661 $16,916,019
Number of units of raw land - 4
Number of lots 3 3
Number of condo/town home units 2 4
Number of single family residences - -
Total
Total Loans $ 51,012,313 $80,109,848
Number of units of raw land $ 2 43
Number of lots $ 213 227
Number of condo/town home units $ 4 7
Number of single family residences $ 68 68
The above collateral information is based on information provided
as part of the related loan documentation process. The actual
number of lots may have changed during the development process
Source: Omni Financial Services, Inc.
----------------------------------------------
Omni Financial Services
Inc.
Connie Perrine
404-250-7745
Chief Financial Officer
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