Business First Bancshares, Inc., Announces Financial Results for Q1 2020

BATON ROUGE, La., April 28, 2020 (GLOBE NEWSWIRE) -- Business First Bancshares, Inc. (NASDAQ: BFST) (Business First), parent company of b1BANK, Baton Rouge, Louisiana, today announced its unaudited results for the quarter ended March 31, 2020, including net income of $4.5 million, or $0.34 per diluted share, decreases of $1.2 million and $0.07, respectively, from the quarter ended March 31, 2019. On a non-GAAP basis, core net income for the quarter ended March 31, 2020, which excludes noncore income and expenses, was $5.0 million, or $0.37 per diluted share, decreases of $655,000 and $0.04, respectively, from the quarter ended March 31, 2019. Both net income and diluted earnings per share were adversely impacted for the quarter ended March 31, 2020, by additional provision for loan losses related to the expected impact of the COVID-19 pandemic.

In response to the COVID-19 pandemic, Business First proactively assisted, and continues to assist, customers by deferring principal and/or interest payments on approximately 1,000 loans with an outstanding balance of $468 million as of April 19, 2020.  Additionally, through April 19, 2020, Business First approved $250 million of Small Business Administration (SBA) Payroll Protection Program (PPP) loans for approximately 1050 applicants.

“2020 opened with a sense of optimism. Our organization achieved solid growth in quality assets, continued to aggregate talented employees and announced a transformative acquisition,” said Jude Melville, president and CEO. “Clearly the end of the first quarter of this new year has been unexpected. While the foreseeable future is challenging, we also know the positives with which we started the year—strong relationships with clients, talented employees, a deeper, more liquid balance sheet-- will ultimately enable us to contribute to our region’s recovery.”

On April 23, 2020, Business First’s board of directors declared a quarterly dividend based upon financial performance for the first quarter in the amount of $0.10 per share, same as the prior quarter, to the common shareholders of record as of May 15, 2020. The dividend will be paid on May 31, 2020, or as soon thereafter as practicable.

Quarterly Highlights

  • Stable Credit Quality. Ratios of nonperforming loans compared to loans held for investment and nonperforming assets compared to total assets increased from 0.53% and 0.58%, respectively, at December 31, 2019, to 0.57% and 0.59% at March 31, 2020. The increase in the nonperforming loan ratio was impacted by a single commercial loan becoming past due 90 days or more. 
  • Stable Net Interest Margin and Spread. Net interest margin and spread were impacted due to the federal funds rate cuts of 150 basis points during the month of March 2020 and one less day for the quarter ended March 31, 2020, offset by loan growth early in the quarter and a reduction in cost of funds compared to the quarter ended December 31, 2019. Net interest margin and net interest spread were 3.93% and 3.55%, respectively, for the quarter ended March 31, 2020, compared to 4.08% and 3.65% for the quarter ended December 31, 2019. Excluding loan discount accretion, net interest margin and spread were 3.88% and 3.49%, respectively, for the quarter ended March 31, 2020, compared to 3.92% and 3.49% for the quarter ended December 31, 2019. 
  • Loan Growth. Total loans held for investment at March 31, 2020, were $1.8 billion, an increase of $61.1 million compared to December 31, 2019. Loan growth was 14.3% (annualized) for the quarter ended March 31, 2020. A significant portion of the loan growth occurred early in the quarter, attributed to delayed closings from the quarter ended December 31, 2019, as previously mentioned in the Q4 2019 press release.
  • Pedestal Bancshares Inc. Acquisition.  Business First executed a definitive agreement to acquire Pedestal Bancshares Inc. on January 22, 2020. Business First received regulatory and shareholder approval in April 2020 and anticipates closing the acquisition in early May 2020.

Financial Condition

March 31, 2020, Compared to December 31, 2019

Loans

Total loans held for investment increased by $61.1 million compared to December 31, 2019, or 14.30% annualized, for the quarter ended March 31, 2020. The growth in the loan portfolio, on a percentage basis, was largely attributed to the commercial, real estate – construction and land, and real estate – farmland segments.

Business First’s unfunded commitments remained constant throughout the quarter, including March which was most impacted by the COVID-19 pandemic. Consequently, the increase in the loan portfolio was attributable to new loan originations, as draws on existing unfunded commitments were minimal.  

Credit Quality

Nonperforming loans as a percentage of total loans held for investment increased from 0.53% as of December 31, 2019, to 0.57% as of March 31, 2020. The increase was attributable to an increase in past due loans of $762,000, of which $465,000 was attributable to a single commercial loan, and $324,000 in nonaccrual loans. Nonperforming assets as a percentage of total assets increased from 0.58% as of December 31, 2019, to 0.59% as of March 31, 2020.

Total Shareholders’ Equity

Book value per common share was $21.58 at March 31, 2020, compared to $21.47 at December 31, 2019. Total shareholders’ equity was impacted by $5.0 million of share repurchases, at an average weighted price of $11.50 per share, for the quarter ended March 31, 2020. Common equity to total assets remains strong at 12.33% at March 31, 2020. 

March 31, 2020, Compared to March 31, 2019

Loans

Total loans held for investment increased by $185.2 million compared to March 31, 2019, or 11.7%. The growth in the loan portfolio was spread throughout many of the loan segments, although exposure was reduced in the real estate – multi-family residential and consumer segments.

Credit Quality

Nonperforming loans as a percentage of total loans held for investment decreased from 0.84% as of March 31, 2019, to 0.57% as of March 31, 2020. Nonperforming assets as a percentage of total assets decreased from 0.71% as of March 31, 2019, to 0.59% as of March 31, 2020.

Total Shareholders’ Equity

Book value per common share was $21.58 at March 31, 2020, compared to $20.14 at March 31, 2019.

Results of Operations

First Quarter 2020 Compared to Fourth Quarter 2019

Net Income and Diluted Earnings Per Share

For the quarter ended March 31, 2020, net income was $4.5 million, or $0.34 per diluted share, compared to net income of $5.8 million, or $0.42 per diluted share, for the quarter ended December 31, 2019. The decreases were largely attributable to the federal funds rate cuts of 150 basis point during March 2020, resulting in a decrease in net interest income, the increase in the provision for loan losses, largely attributable to the COVID-19 pandemic, and the increase in merger and conversion-related expenses, offset by a reduction in provision for income taxes attributable to stock option exercises and increase in other income.

On a non-GAAP basis, core net income, which excludes noncore income and expenses, for the quarter ended March 31, 2020, was $5.0 million, or $0.37 per diluted share, compared to core net income of $6.1 million, or $0.45 per diluted share, for the quarter ended December 31, 2019. Notable noncore events impacting earnings for the quarter ended March 31, 2020, included the incurrence of $126,000 in gains associated with the disposal of former bank premises and equipment in other income and $1.2 million in acquisition-related expenses, compared to the incurrence of $125,000 in losses associated with the disposal of former bank premises and equipment in other income related to the rebranding of b1BANK and a $216,000 adjustment to estimated provision for income taxes associated with the sale of the Mangham banking center for the quarter ended December 31, 2019.

Interest Income

For the quarter ended March 31, 2020, net interest income totaled $20.2 million and net interest margin and net interest spread were 3.93% and 3.55%, respectively, compared to $20.6 million, 4.08% and 3.65% for the quarter ended December 31, 2019. The average yield on the loan portfolio was 5.55% for the quarter ended March 31, 2020, compared to 5.82% for the quarter ended December 31, 2019. The average yield on total interest-earning assets was 5.06% for the quarter ended March 31, 2020, compared to 5.28% for the quarter ended December 31, 2019.  

Average loan yield, average yield on total interest-earning assets, net interest margin, and net interest spread were impacted for the quarter ended March 31, 2020, by less discount accretion, lower yielding loans due to the federal funds rate cuts of 150 basis points during March, and one less day for the quarter ended March 31, 2020, compared to the quarter ended December 31, 2019. The impact to net interest margin and net interest spread was mitigated by a reduction in the overall cost of funds (which includes noninterest-bearing deposits).

Net interest margin and net interest spread (excluding loan discount accretion of $290,000) were 3.88% and 3.49%, respectively, for the quarter ended March 31, 2020, compared to 3.92% and 3.49% (excluding loan discount accretion of $800,000) for the quarter ended December 31, 2019.

Interest Expense

For the quarter ended March 31, 2020, overall cost of funds (which includes noninterest-bearing deposits) decreased by seven basis points, from 1.27% to 1.20%, compared to the quarter ended December 31, 2019. The decrease in cost of funds was largely attributable to an overall reduction in interest rates on b1BANK’s deposit offerings.

Other Income

For the quarter ended March 31, 2020, other income was impacted by an additional $230,000 in small business investment company (SBIC) investment income and $250,000 increase in gains/losses on sales of former premises and equipment compared to the quarter ended December 31, 2019.

Other Expense

For the quarter ended March 31, 2020, salaries and employee benefits increased $410,000 due to annual raises, tax on executive bonus, tax on stock option exercises and increased headcount of full-time equivalent employees from 355 to 367, offset by one less day during the quarter ended March 31, 2020, compared to the quarter ended December 31, 2019.

Other expenses increased by $1.1 million due to merger and conversion-related costs incurred during the quarter ended March 31, 2020, offset by a decrease of $379,000 in additional other real estate owned expenses and write-downs compared to the quarter ended December 31, 2019.

Provision for Loan Losses

During the quarter ended March 31, 2020, Business First recorded a provision for loan losses of $1.4 million, compared to $192,000 for the quarter ended December 31, 2019. The reserve for the quarter ended March 31, 2020, was impacted significantly by the expected impact of the COVID-19 pandemic.  The increase related to COVID-19 was recorded through a qualitative adjustment.  The provision for the quarter ended December 31, 2019, was lower due to tempered annualized loan growth of 3.67% during the quarter.

Return on Assets and Equity

Return on average assets and equity, each on an annualized basis, were 0.80% and 6.31%, respectively, for the quarter ended March 31, 2020, compared to 1.04% and 8.18%, respectively, for the quarter ended December 31, 2019. 

First Quarter 2020 Compared to First Quarter 2019

Net Income and Diluted Earnings Per Share

For the quarter ended March 31, 2020, net income was $4.5 million, or $0.34 per diluted share, compared to net income of $5.7 million, or $0.41 per diluted share, for the quarter ended March 31, 2019. The decreases in net income and diluted earnings per share were mainly attributable to increased provision for loan losses, expenses in salaries and employee benefits, merger and conversion-related expenses, other real estate owned expenses and write-downs and other expenses, offset by an increase in net interest income, other income and reduction in provision for income taxes associated with stock option exercises.

On a non-GAAP basis, core net income, which excludes noncore income and expenses, for the quarter ended March 31, 2020, was $5.0 million, or $0.37 per diluted share, compared to core net income of $5.6 million, or $0.41 per diluted share, for the quarter ended March 31, 2019. Notable noncore events impacting earnings for the quarter ended March 31, 2020, included the incurrence of $126,000 in gains associated with the disposal of former bank premises and equipment in other income and $1.2 million in acquisition-related expenses.

Interest Income

For the quarter ended March 31, 2020, net interest income totaled $20.2 million and net interest margin and net interest spread were 3.93% and 3.55%, respectively, compared to $19.1 million, 4.01% and 3.61% for the quarter ended March 31, 2019. The average yield on the loan portfolio was 5.55% for the quarter ended March 31, 2020, compared to 5.79% for the quarter ended March 31, 2019. The average yield on total interest-earning assets was 5.06% for the quarter ended March 31, 2020, compared to 5.16% for the quarter ended March 31, 2019.

Average loan yield, average yield on total interest-earning assets, net interest margin, and net interest spread were impacted for the quarter ended March 31, 2020, largely by the federal funds rate cuts of 225 basis points which occurred throughout the second half of 2019 and first quarter of 2020.

Net interest margin and net interest spread (excluding loan discount accretion of $290,000) were 3.88% and 3.49%, respectively, for the quarter ended March 31, 2020, compared to 3.92% and 3.52% (excluding loan discount accretion of $432,000) for the quarter ended March 31, 2019.

Interest Expense

For the quarter ended March 31, 2020, overall cost of funds (which includes noninterest-bearing deposits) decreased by one basis point, from 1.21% to 1.20%, compared to the quarter ended March 31, 2019.

Other Income

For the quarter ended March 31, 2020, other income was impacted by $380,000 in SBIC investment income, $126,000 in gains on sales of former premises and equipment, and $177,000 of SBA loan sales, offset by reductions in correspondent bank income of $99,000 and rental income of $133,000.

Other Expense

For the quarter ended March 31, 2020, salaries and employee benefits increased $883,000 due to annual merit raises and increased headcount of full-time equivalent employees from 346 to 367 compared to the quarter ended March 31, 2019.

Other expenses increased for the quarter ended March 31, 2020, by $1.4 million in merger and conversion-related costs, $226,000 in additional other real estate owned expenses and write-downs, and approximately $141,000 in loan collection expenses compared to the quarter ended March 31, 2019.

Provision for Loan Losses

During the quarter ended March 31, 2020, Business First recorded a provision for loan losses of $1.4 million compared to $633,000 for the quarter ended March 31, 2019. The reserve for the quarter ended March 31, 2020, was impacted significantly by the expected impact of the COVID-19 pandemic.  The increase related to COVID-19 was recorded through a qualitative adjustment. 

Return on Assets and Equity

Return on average assets and return on average equity, each on an annualized basis, were 0.80% and 6.31%, respectively, for the quarter ended March 31, 2020, from 1.09% and 8.62%, respectively, for the quarter ended March 31, 2019. 

About Business First Bancshares, Inc.

Business First Bancshares, Inc., through its banking subsidiary b1BANK, formerly known as Business First Bank, operates 26 banking centers in markets across Louisiana and in the Dallas, Texas area. b1BANK provides commercial and personal banking, treasury management and wealth solutions services to small to midsize businesses and their owners and employees. Visit www.b1BANK.com for more information. Business First’s common stock is traded on the NASDAQ Global Select Market under the symbol “BFST.”

Non-GAAP Financial Measures

This press release includes certain non-GAAP financial measures (e.g., referenced as “core” or “tangible” or “pre-tax, pre-provision”) intended to supplement, not substitute for, comparable GAAP measures. These measures typically adjust income available to common shareholders for certain significant activities or transactions that, in management’s opinion, can distort period-to-period comparisons of Business First’s performance. Transactions that are typically excluded from non-GAAP measures include realized and unrealized gains/losses on former bank premises and equipment, investment sales, impaired loan sales, acquisition-related expenses (including, but not limited to, legal costs, system conversion costs, severance and retention payments, etc.). Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core business. These non-GAAP disclosures are not necessarily comparable to non-GAAP measures that may be presented by other companies. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of the tables below.

Special Note Regarding Forward-Looking Statements

Certain statements contained in this release may not be based on historical facts and are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “may,” “might,” “will,” “would,” “could” or “intend.” We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors, including those factors specified in our Annual Report on Form 10-K and other public filings. Actual results will also be significantly impacted by the effects of the ongoing COVID-19 pandemic, including, among other effects: the impact of the public health crisis; the extent and duration of closures of businesses, including our branches, vendors and customers; the operation of financial markets; employment levels; market liquidity; the impact of various actions taken in response by the U.S. federal government, the Federal Reserve, other banking regulators, state and local governments; the adequacy of our allowance for loan losses in relation to potential losses in our loan portfolio; and the impact that all of these factors have on our borrowers, other customers, vendors and counterparties. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.

Additional Information

For additional information on Business First, you may obtain Business First’s reports that are filed with the Securities and Exchange Commission (SEC) free of charge by using the SEC’s EDGAR service on the SEC’s website at www.sec.gov or by contacting the SEC for further information at 1-800-SEC-0330. Alternatively, these documents can be obtained free of charge from Business First by directing a request to: Business First Bancshares, Inc., 500 Laurel Street, Suite 101, Baton Rouge, Louisiana 70801, Attention: Corporate Secretary.

No Offer or Solicitation

This release does not constitute or form part of any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.



Business First Bancshares, Inc. 
Selected Financial Information 
(Unaudited) 
     
 March 31,December 31,March 31, 
(Dollars in thousands) 2020  2019  2019  
     
Balance Sheet Ratios    
     
Loans (HFI) to Deposits 98.26%  95.97%  90.93%  
Shareholders' Equity to Assets Ratio 12.33%  12.54%  12.81%  
     
Loans Receivable Held for Investment    
     
Commercial$431,992 $390,398 $389,855  
Real Estate:    
Construction and Land 260,836  244,181  211,888  
Farmland 53,900  48,681  44,066  
1-4 Family Residential 295,876  293,142  275,610  
Multi-Family Residential 32,859  36,454  39,548  
Nonfarm Nonresidential 623,114  612,608  550,103  
Total Real Estate 1,266,585  1,235,066  1,121,215  
Consumer 72,803  84,801  75,112  
Total Loans$1,771,380 $1,710,265 $1,586,182  
     
     
Allowance for Loan Losses    
     
Balance, Beginning of Period$12,124 $12,090 $11,220  
Charge-offs – Quarterly (194) (190) (57) 
Recoveries – Quarterly 22  32  22  
Provision for Loan Losses – Quarterly 1,367  192  633  
Balance, End of Period$13,319 $12,124 $11,818  
     
Allowance for Loan Losses to Total Loans (HFI) 0.75%  0.71%  0.75%  
Net Charge-offs (Recoveries) to Average Total Loans 0.01%  0.01%  0.00%  
     
     
Nonperforming Assets    
     
Nonperforming Loans:    
Nonaccrual Loans$9,301 $8,977 $13,183  
Loans Past Due 90 Days or More 834  72  77  
Total Nonperforming Loans 10,135  9,049  13,260  
Other Nonperforming Assets:    
Other Real Estate Owned 3,281  4,036  1,683  
Other Nonperforming Assets 11  160  11  
Total Other Nonperforming Assets 3,292  4,196  1,694  
Total Nonperforming Assets$13,427 $13,245 $14,954  
     
Nonperforming Loans to Total Loans (HFI) 0.57%  0.53%  0.84%  
Nonperforming Assets to Total Assets 0.59%  0.58%  0.71%  
     



Business First Bancshares, Inc. 
Selected Financial Information 
(Unaudited) 
        
 Three Months Ended Three Months Ended 
 March 31,December 31,March 31, March 31,March 31, 
(Dollars in thousands, except per share data) 2020  2019  2019   2020  2019  
        
Per Share Data       
        
Basic Earnings per Common Share$0.34 $0.43 $0.43  $0.34 $0.43  
Diluted Earnings per Common Share$0.34  0.42  0.41   0.34  0.41  
Dividends per Common Share 0.10  0.10  0.08   0.10  0.08  
Book Value per Common Share 21.58  21.47  20.14   21.58  20.14  
        
        
Average Common Shares Outstanding 13,313,154  13,277,968  13,287,560   13,313,154  13,287,560  
Average Diluted Shares Outstanding 13,367,276  13,638,168  13,653,125   13,367,276  13,653,125  
End of Period Common Shares Outstanding 13,067,987  13,279,363  13,361,482   13,067,987  13,361,482  
        
        
Annualized Performance Ratios       
        
Return on Average Assets 0.80%  1.04%  1.09%   0.80%  1.09%  
Return on Average Equity 6.31%  8.18%  8.62%   6.31%  8.62%  
Net Interest Margin 3.93%  4.08%  4.01%   3.93%  4.01%  
Net Interest Spread 3.55%  3.65%  3.61%   3.55%  3.61%  
Efficiency Ratio (1) 72.39%  66.50%  64.35%   72.39%  64.35%  
        
Total Quarterly/Year-to-Date Average Assets$2,244,584 $2,209,182 $2,075,683  $2,244,584 $2,075,683  
Total Quarterly/Year-to-Date Average Equity 285,338  281,589  262,681   285,338  262,681  
        
Other Operating Expenses       
        
Salaries and Employee Benefits$9,435 $9,025 $8,552  $9,435 $8,552  
Occupancy and Bank Premises 1,060  920  1,103   1,060  1,103  
Depreciation and Amortization 601  588  628   601  628  
Data Processing 652  477  616   652  616  
FDIC Assessment Fees 147  (15) 150   147  150  
Legal and Other Professional Fees 394  302  318   394  318  
Advertising and Promotions 306  385  327   306  327  
Utilities and Communications 317  316  298   317  298  
Ad Valorem Shares Tax 375  388  345   375  345  
Directors' Fees 74  119  205   74  205  
Other Real Estate Owned Expenses and Write-Downs 253  632  27   253  27  
Merger and Conversion-Related Expenses 1,148  (1) (254)  1,148  (254) 
Other 1,881  2,067  1,475   1,881  1,475  
Total Other Expenses$16,643 $15,203 $13,790  $16,643 $13,790  
        
(1) Noninterest expense (excluding provision for loan losses) divided by noninterest income plus net interest income less gain/loss on sales of securities.  
        



Business First Bancshares, Inc. 
Consolidated Balance Sheets 
(Unaudited) 
     
 March 31,December 31,March 31, 
(Dollars in thousands) 2020  2019  2019  
     
Assets    
     
Cash and Due From Banks$80,109 $89,371 $52,606  
Federal Funds Sold 29,135  61,372  30,093  
Securities Available for Sale, at Fair Values 275,115  278,193  304,122  
Mortgage Loans Held for Sale 868  251  753  
Loans and Lease Receivable 1,771,380  1,710,265  1,586,182  
Allowance for Loan Losses (13,319) (12,124) (11,818) 
Net Loans and Lease Receivable 1,758,061  1,698,141  1,574,364  
Premises and Equipment, Net 29,656  29,280  27,014  
Accrued Interest Receivable 7,724  8,025  7,054  
Other Equity Securities 11,721  12,565  8,508  
Other Real Estate Owned 3,281  4,036  1,683  
Cash Value of Life Insurance 32,765  32,568  32,050  
Deferred Taxes, Net 1,800  2,145  3,077  
Goodwill 48,495  48,495  49,534  
Core Deposit Intangible 6,471  6,694  7,655  
Other Assets 2,461  2,699  2,887  
     
Total Assets$2,287,662 $2,273,835 $2,101,400  
     
     
Liabilities    
     
Deposits:    
Noninterest-Bearing$417,534 $398,847 $396,775  
Interest-Bearing 1,385,274  1,383,163  1,347,608  
Total Deposits 1,802,808  1,782,010  1,744,383  
     
Securities Sold Under Agreements to Repurchase 14,728  67,989  11,070  
Short-Term Borrowings 5,000  -  -  
Subordinated Debt 25,000  25,000  25,000  
Federal Home Loan Bank Borrowings 138,000  93,000  30,000  
Accrued Interest Payable 1,573  1,533  2,039  
Other Liabilities 18,523  19,206  19,764  
     
Total Liabilities 2,005,632  1,988,738  1,832,256  
     
Shareholders' Equity    
     
Common Stock 13,068  13,279  13,361  
Additional Paid-In Capital 206,966  212,505  213,537  
Retained Earnings 59,859  56,700  42,576  
Accumulated Other Comprehensive Loss 2,137  2,613  (330) 
     
Total Shareholders' Equity 282,030  285,097  269,144  
     
Total Liabilities and Shareholders' Equity$2,287,662 $2,273,835 $2,101,400  
     



Business First Bancshares, Inc. 
Consolidated Statements of Income 
(Unaudited) 
        
  Three Months Ended  Three Months Ended 
 March 31,December 31,March 31, March 31,March 31, 
(Dollars in thousands) 2020 2019  2019   2020 2019  
        
Interest Income:       
Interest and Fees on Loans$24,143$24,732 $22,423  $24,143$22,423  
Interest and Dividends on Securities 1,731 1,739  1,874   1,731 1,874  
Interest on Federal Funds Sold and Due From Banks 142 193  290   142 290  
Total Interest Income 26,016 26,664  24,587   26,016 24,587  
        
Interest Expense:       
Interest on Deposits 4,686 4,908  4,757   4,686 4,757  
Interest on Borrowings 1,119 1,129  710   1,119 710  
Total Interest Expense 5,805 6,037  5,467   5,805 5,467  
        
Net Interest Income 20,211 20,627  19,120   20,211 19,120  
        
Provision for Loan Losses 1,367 192  633   1,367 633  
        
Net Interest Income After Provision for Loan Losses 18,844 20,435  18,487   18,844 18,487  
        
Other Income:       
Service Charges on Deposit Accounts 931 1,028  938   931 938  
Gain on Sales of Securities 25 22  -   25 -  
Other Income 1,848 1,206  1,373   1,848 1,373  
Total Other Income 2,804 2,256  2,311   2,804 2,311  
        
Other Expenses:       
Salaries and Employee Benefits 9,435 9,025  8,552   9,435 8,552  
Occupancy and Equipment Expense 1,891 1,715  1,894   1,891 1,894  
Merger and Conversion-Related Expense 1,148 (1) (254)  1,148 (254) 
Other Expenses 4,169 4,464  3,598   4,169 3,598  
Total Other Expenses 16,643 15,203  13,790   16,643 13,790  
        
Income Before Income Taxes 5,005 7,488  7,008 - 5,005 7,008  
        
Provision for Income Taxes 506 1,729  1,349   506 1,349  
        
Net Income$4,499$5,759 $5,659  $4,499$5,659  
        



Business First Bancshares, Inc. 
Consolidated Net Interest Margin 
(Unaudited) 
             
             
 Three Months Ended 
 March 31, 2020 December 31, 2019 March 31, 2019 
 Average   Average   Average   
 OutstandingInterest Earned /Average OutstandingInterest Earned /Average OutstandingInterest Earned /Average 
(Dollars in thousands)BalanceInterest PaidYield / Rate BalanceInterest PaidYield / Rate BalanceInterest PaidYield / Rate 
             
Assets            
             
Interest-Earning Assets            
Total Loans$1,740,189 $24,1435.55% $1,698,947 $24,7325.82% $1,549,887 $22,4235.79% 
Securities Available for Sale 286,660  1,7312.42%  290,034  1,7392.40%  309,768  1,8742.42% 
Interest-Bearing Deposit in Other Banks 28,754  1421.98%  31,648  1932.44%  45,215  2902.57% 
Total Interest-Earning Assets 2,055,603  26,0165.06%  2,020,629  26,6645.28%  1,904,870  24,5875.16% 
Allowance for Loan Losses (12,203)    (12,174)    (11,390)   
Noninterest-Earning Assets 201,184     200,727     182,203    
Total Assets$2,244,584 $26,016  $2,209,182 $26,664  $2,075,683 $24,587  
             
             
Liabilities and Shareholders' Equity            
             
Interest-Bearing Liabilities            
Interest-Bearing Deposits$1,342,213 $4,6861.40% $1,295,791 $4,9081.52% $1,335,413 $4,7571.42% 
Subordinated Debt 25,000  4226.75%  25,000  4226.75%  25,000  4166.66% 
Advances from Federal Home Loan Bank ("FHLB") 98,323  4972.02%  96,763  5162.13%  37,527  2813.00% 
Other Borrowings 67,125  2001.19%  67,087  1911.14%  12,482  130.42% 
Total Interest-Bearing Liabilities 1,532,661  5,8051.52%  1,484,641  6,0371.63%  1,410,422  5,4671.55% 
             
Noninterest-Bearing Liabilities            
Noninterest-Bearing Deposits$406,035     419,231     393,816    
Other Liabilities 20,550     23,721     8,764    
Total Noninterest-Bearing Liabilities 426,585     442,952     402,580    
Shareholders' Equity 285,338     281,589     262,681    
Total Liabilities and Shareholders' Equity$2,244,584    $2,209,182    $2,075,683    
             
Net Interest Spread  3.55%   3.65%   3.61% 
Net Interest Income $20,211   $20,627   $19,120  
Net Interest Margin  3.93%   4.08%   4.01% 
             
Overall Cost of Funds  1.20%   1.27%   1.21% 
             
NOTE: Average outstanding balances are determined utilizing monthly averages and average yield/rate is calculated utilizing a 30/360 day count convention.   
             



Business First Bancshares, Inc. 
Non-GAAP Measures 
(Unaudited) 
        
 Three Months Ended Three Months Ended 
 March 31,December 31,March 31, March 31,March 31, 
(Dollars in thousands, except per share data) 2020  2019  2019   2020  2019  
        
Interest Income:       
Interest income$26,016 $26,664 $24,587  $26,016 $24,587  
Core interest income 26,016  26,664  24,587   26,016  24,587  
Interest Expense:       
Interest expense 5,805  6,037  5,467   5,805  5,467  
Core interest expense 5,805  6,037  5,467   5,805  5,467  
Provision for Loan Losses: (b)       
Provision for loan losses 1,367  192  633   1,367  633  
Core provision expense 1,367  192  633   1,367  633  
Other Income:       
Other income 2,804  2,256  2,311   2,804  2,311  
(Gains) losses on former bank premises and equipment (126) 125  -   (126) -  
(Gains) on sale of securities (25) (22) -   (25) -  
Core other income 2,653  2,359  2,311   2,653  2,311  
Other Expense:       
Other expense 16,643  15,203  13,790   16,643  13,790  
Acquisition-related expenses (2) (1,212) (76) 50   (1,212) 50  
Stock option exercises - excess taxes (71) -  -   (71) -  
Core other expense 15,360  15,127  13,840   15,360  13,840  
Pre-Tax Income: (a)       
Pre-tax income 5,005  7,488  7,008   5,005  7,008  
(Gains) losses on former bank premises and equipment (126) 125  -   (126) -  
(Gains) on sale of securities (25) (22) -   (25) -  
Acquisition-related expenses (2) 1,212  76  (50)  1,212  (50) 
Stock option exercises - excess taxes 71  -  -   71  -  
Core pre-tax income 6,137  7,667  6,958   6,137  6,958  
Provision for Income Taxes (1):       
Provision for income taxes 506  1,729  1,349   506  1,349  
Tax on (gains) losses on former bank premises and equipment (26) 26  -   (26) -  
Tax on (gains) on sale of securities (5) (5) -   (5) -  
Tax on sale of banking center -  (216) -   -  -  
Tax on acquisition-related expenses (2) 91  11  (16)  91  (16) 
Tax on stock option exercises 602     602   
Core provision for income taxes 1,167  1,545  1,333   1,167  1,333  
Net Income:       
Net income 4,499  5,759  5,659   4,499  5,659  
(Gains) losses on former bank premises and equipment , net of tax (100) 99  -   (100) -  
(Gains) on sale of securities, net of tax (20) (17) -   (20) -  
Tax on sale of banking center -  216  -   -  -  
Acquisition-related expenses (2), net of tax 1,121  65  (34)  1,121  (34) 
Stock option exercises, net of tax (531) -  -   (531) -  
Core net income$4,970 $6,122 $5,625  $4,970 $5,625  
        
Pre-tax, pre-provision earnings (a+b)$6,372 $7,680 $7,641  $6,372 $7,641  
(Gains) losses on former bank premises and equipment (126) 125  -   (126) -  
(Gains) on sale of securities (25) (22) -   (25) -  
Acquisition-related expenses (2) 1,212  76  (50)  1,212  (50) 
Stock option exercises 71  -  -   71  -  
Core pre-tax, pre-provision earnings$7,504 $7,859 $7,591  $7,504 $7,591  
        
Average Diluted Shares Outstanding 13,367,276  13,638,168  13,653,125   13,367,276  13,653,125  
        
Diluted Earnings Per Share:       
Diluted earnings per share$0.34 $0.42 $0.41  $0.34 $0.41  
(Gains) losses on former bank premises and equipment , net of tax (0.01) 0.01  -   (0.01) -  
(Gains) on sale of securities, net of tax (0.00) (0.00) -   (0.00) -  
Tax on sale of banking center -  0.02  -   -  -  
Acquisition-related expenses (2), net of tax 0.08  0.00  (0.00)  0.08  (0.00) 
Stock option exercises (0.04) -  -   (0.04) -  
Core diluted earnings per share$0.37 $0.45 $0.41  $0.37 $0.41  
        
Pre-tax, pre-provision profit diluted earnings per share$0.48 $0.56 $0.56  $0.48 $0.56  
(Gains) losses on former bank premises and equipment (0.01) 0.01  -   (0.01) -  
(Gains) on sale of securities (0.00) (0.00) -   (0.00) -  
Acquisition-related expenses (2) 0.09  0.01  (0.00)  0.09  (0.00) 
Stock option exercises 0.01  -  -   0.01  -  
Core pre-tax, pre-provision diluted earnings per share$0.56 $0.58 $0.56  $0.56 $0.56  
        
(1) Tax rates, exclusive of certain nondeductible merger-related expenses and goodwill, utilized were 21% for 2020 and 2019. These rates approximated the marginal tax rates.   
(2) Includes merger and conversion-related expenses and salary and employee benefits.     
        



Business First Bancshares, Inc. 
Non-GAAP Measures 
(Unaudited) 
        
 Three Months Ended Three Months Ended 
 March 31,December 31,March 31, March 31,March 31, 
(Dollars in thousands, except per share data) 2020  2019  2019   2020  2019  
        
        
Total Quarterly/Year-to-Date Average Assets 2,244,584  2,209,182  2,075,683   2,244,584  2,075,683  
Total Quarterly/Year-to-Date Average Equity 285,338  281,589  262,681   285,338  262,681  
        
Net Income:      -  
Net income$4,499 $5,759 $5,659  $4,499 $5,659  
(Gains) losses on former bank premises and equipment , net of tax (100) 99  -   (100) -  
(Gains) on sale of securities, net of tax (20) (17) -   (20) -  
Tax on sale of banking center -  216  -   -  -  
Acquisition-related expenses (2), net of tax 1,121  65  (34)  1,121  (34) 
Stock option exercises, net of tax (531) -  -   (531) -  
Core net income$4,970 $6,122 $5,625  $4,970 $5,625  
        
Return on average assets 0.80%  1.04%  1.09%   0.80%  1.09%  
Core return on average assets 0.89%  1.11%  1.08%   0.89%  1.08%  
Return on equity 6.31%  8.18%  8.62%   6.31%  8.62%  
Core return on average equity 6.97%  8.70%  8.57%   6.97%  8.57%  
        
Interest Income:       
Interest income$26,016 $26,664 $24,587  $26,016 $24,587  
Core interest income 26,016  26,664  24,587   26,016  24,587  
Interest Expense:      -  
Interest expense 5,805  6,037  5,467   5,805  5,467  
Core interest expense 5,805  6,037  5,467   5,805  5,467  
Other Income:      -  
Other income 2,804  2,256  2,311   2,804  2,311  
(Gains) losses on former bank premises and equipment (126) 125  -   (126) -  
(Gains) on sale of securities (25) (22) -   (25) -  
Core other income 2,653  2,359  2,311   2,653  2,311  
Other Expense:      -  
Other expense 16,643  15,203  13,790   16,643  13,790  
Acquisition-related expenses (1,212) (76) 50   (1,212) 50  
Stock option exercises - excess taxes (71) -  -   (71) -  
Core other expense$15,360 $15,127 $13,840  $15,360 $13,840  
        
Efficiency Ratio       
Other expense (a)$16,643 $15,203 $13,790  $16,643 $13,790  
Core other expense (c)$15,360 $15,127 $13,840  $15,360 $13,840  
Net interest and other income (1) (b)$22,990 $22,861 $21,431  $22,990 $21,431  
Core net interest and other income (1) (d)$22,864 $22,986 $21,431  $22,864 $21,431  
Efficiency ratio (a/b) 72.39%  66.50%  64.35%   72.39%  64.35%  
Core efficiency ratio (c/d) 67.18%  65.81%  64.58%   67.18%  64.58%  
        
Total Average Interest-Earnings Assets$2,055,603 $2,020,629 $1,904,870  $2,055,603 $1,904,870  
        
Net Interest Income        
Net interest income$20,211 $20,627 $19,120  $20,211 $19,120  
Loan discount accretion (290) (800) (432)  (290) (432) 
Net interest income excluding loan discount accretion$19,921 $19,827 $18,688  $19,921 $18,688  
        
Net interest margin (2) 3.93%  4.08%  4.01%   3.93%  4.01%  
Net interest margin excluding loan discount accretion (2) 3.88%  3.92%  3.92%   3.88%  3.92%  
Net interest spread 3.55%  3.65%  3.61%   3.55%  3.61%  
Net interest spread excluding loan discount accretion 3.49%  3.49%  3.52%   3.49%  3.52%  
        
(1) Excludes gains/losses on sales of securities.       
(2) Calculated utilizing a 30/360 day count convention.       
        



Business First Bancshares, Inc. 
Non-GAAP Measures 
(Unaudited) 
     
     
 March 31,December 31,March 31, 
(Dollars in thousands, except per share data) 2020  2019  2019  
     
Total Shareholders' (Common) Equity    
Total shareholders' equity$282,030 $285,097 $269,144  
Goodwill (48,495) (48,495) (49,534) 
Core deposit intangible (6,471) (6,694) (7,655) 
Total tangible common equity$227,064 $229,908 $211,955  
     
     
Total Assets    
Total assets$2,287,662 $2,273,835 $2,101,400  
Goodwill (48,495) (48,495) (49,534) 
Core deposit intangible (6,471) (6,694) (7,655) 
Total tangible assets$2,232,696 $2,218,646 $2,044,211  
     
Common shares outstanding 13,067,987  13,279,363  13,361,482  
     
Book value per common share$21.58 $21.47 $20.14  
Tangible book value per common share$17.38 $17.31 $15.86  
Common equity to total assets 12.33%  12.54%  12.81%  
Tangible common equity to tangible assets 10.17%  10.36%  10.37%  
     

Misty Albrecht
b1BANK
225.286.7879
Misty.Albrecht@b1BANK.com

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