On July 18, 2024, Southern First Bancshares Inc (SFST, Financial) released its 8-K filing for the second quarter of 2024. Southern First Bancshares Inc is a bank holding company engaged in accepting demand and savings deposits insured by the FDIC and providing commercial, consumer, and mortgage loans. The majority of its revenue is derived from the Commercial and Retail Banking segment.
Performance Overview
Southern First Bancshares Inc (SFST, Financial) reported net income of $3.0 million for Q2 2024, translating to diluted earnings per share (EPS) of $0.37. This performance exceeded the analyst estimate of $0.29 per share. Total revenue for the quarter was $23.05 million, surpassing the estimated $19.42 million.
Key Financial Achievements
Despite a slight decrease in total loans and deposits, Southern First Bancshares Inc (SFST, Financial) demonstrated strong financial health with a net interest margin of 1.98%, up from 1.94% in Q1 2024. The company's book value per common share increased to $39.09, reflecting a solid balance sheet.
Income Statement Highlights
| Quarter Ended | June 30, 2024 | March 31, 2024 | June 30, 2023 |
|---|---|---|---|
| Net Income ($ in thousands) | $2,999 | $2,522 | $2,458 |
| Earnings per Common Share, Diluted | $0.37 | $0.31 | $0.31 |
| Total Revenue | $23,051 | $21,309 | $21,561 |
| Net Interest Margin | 1.98% | 1.94% | 2.05% |
Balance Sheet and Cash Flow
As of June 30, 2024, total assets stood at $4.1 billion, with total loans amounting to $3.6 billion and total deposits at $3.5 billion. The company's allowance for credit losses was $40.2 million, or 1.11% of total loans, consistent with the previous quarter.
Asset Quality and Risk Management
Nonperforming assets increased to 0.27% of total assets, up from 0.09% in Q1 2024. This rise was primarily due to four new relationships placed on nonaccrual, including a significant commercial relationship in the assisted living industry. The company's classified asset ratio also increased to 4.22% from 3.99% in the previous quarter.
Commentary from Management
“We reported solid performance in the second quarter with improved profitability across all measures. Loans and core deposits were modestly down, as expected, as we continue to focus on disciplined pricing on both sides of the balance sheet. Noninterest-bearing deposit growth was excellent, which reflects the strength of our team. We are expanding profitable client relationships by delivering a unique, authentic service experience. Economic conditions across all our markets remain positive, but we are constantly aware of the broader environment and remain diligent and conservative. Our focus on building a strong, high-quality balance sheet with measured, deliberate growth has been paying off in our financial results,” stated Art Seaver, the Company’s Chief Executive Officer.
Analysis
Southern First Bancshares Inc (SFST, Financial) has demonstrated resilience and strategic growth in Q2 2024. The company's ability to exceed analyst estimates for both EPS and revenue highlights its effective management and operational efficiency. However, the increase in nonperforming assets and the provision for credit losses indicate areas that require close monitoring. Overall, the company's strong net interest margin and book value per share underscore its solid financial foundation.
For more detailed financial information, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from Southern First Bancshares Inc for further details.
