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Horizon Bancorp Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: May 10, 2012 02:26PM
Horizon Bancorp (HBNC) filed Quarterly Report for the period ended 2012-03-31. Horizon Bncp-in has a market cap of $123.4 million; its shares were traded at around $26.3 with a P/E ratio of 9.4 and P/S ratio of 1.5. The dividend yield of Horizon Bncp-in stocks is 2.1%. Horizon Bncp-in had an annual average earning growth of 6.3% over the past 10 years. GuruFocus rated Horizon Bncp-in the business predictability rank of 2-star.
Highlight of Business Operations:Consolidated net income for the three-month period ended March 31, 2012 was $4.6 million, an increase of 66.8% from the $2.8 million for the same period in 2011. Earnings per common share for the three months ended March 31, 2012 increased to $0.90 basic and $0.88 diluted, compared to $0.51 basic and $0.49 diluted for the same three-month period in 2011. Dividends paid on preferred shares reduced diluted earnings per share by $0.03 and $0.08 per share for the three-month periods ended March 31, 2012 and 2011, respectively.
Net interest income during the three months ended March 31, 2012 was $13.2 million, an increase of $2.1 million over the $11.1 million earned during the same period in 2011. Yields on the Companys interest-earning assets decreased by 2 basis points to 4.91% from 4.93% for the three months ended March 31, 2012 and 2011, respectively. Interest income increased $1.4 million from $15.4 million for the three months ended March 31, 2011 to $16.8 million for the same period in 2012. This increase was primarily due to an increase in interest earning assets offset slightly from the yield on new and repriced earning assets. However, the asset yields on loans receivable has not declined at the same pace as some market indices partially due to interest rate floors that are in place on approximately $387.1 million of the Companys $520.5 million of adjustable rate loans.
Rates paid on interest-bearing liabilities decreased by 34 basis points for the three months ended March 31, 2012 compared to the same period in 2011 due to the lower interest rate environment. Interest expense decreased $736,000 from $4.4 million for the three-months ended March 31, 2011 to $3.6 million for the same period in 2012. This decrease was due to the lower rates being paid on the Companys interest bearing liabilities. Due to a more significant decrease in the rates paid on the Companys interest-bearing liabilities compared to the decrease in yields received on the Companys interest-earning assets the net interest margin increased 30 basis points from 3.57% for the three months ended March 31, 2011 to 3.87% for the same period in 2012.
The capital resources of Horizon and the Bank exceeded regulatory capital ratios for well capitalized banks at March 31, 2012. Stockholders equity totaled $126.2 million as of March 31, 2012, compared to $121.5 million as of December 31, 2011. At March 31, 2012, the quarters ratio of average stockholders equity to average assets was 8.33% compared to 7.96% at December 31, 2011. Horizons capital increased during the three months as a result of increased earnings and an increase in accumulated other comprehensive income, net of dividends declared and the amortization of unearned compensation.
Horizon declared common dividends in the amount of $0.13 per share during the first three months of 2012 compared to $0.11 for the same period of 2011. The dividend payout ratio (dividends as a percent of basic earnings per share) was 14.4% and 22.42% for the first three months of 2012 and 2011, respectively. For additional information regarding dividend conditions, see Horizons Annual Report on Form 10-K for 2011.
Stocks Discussed: HBNC,