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Capital City Bank Group, Inc. Reports Second Quarter 2015 Results

20:00 EDT 20 Jul 2015 | Globe Newswire

TALLAHASSEE, Fla., July 21, 2015 (GLOBE NEWSWIRE) -- Capital City Bank Group, Inc. (Nasdaq:CCBG) today reported net income of $3.8 million, or $0.22 per diluted share for the second quarter of 2015 compared to net income of $1.0 million, or $0.06 per diluted share for the first quarter of 2015, and $1.5 million, or $0.08 per diluted share, for the second quarter of 2014.  For the first six months of 2015, net income of $4.8 million, or $0.28 per diluted share, compared to net income of $5.2 million, or $0.30 per diluted share for the same period in 2014.       

HIGHLIGHTS

  • Continued loan growth - 1.8% sequentially and 3.3% year to date
  • Growth in tax-equivalent net interest income driven by improved earning asset mix – 2.7% sequentially and 2.0% over prior year
  • Strong fee income from residential mortgage loan sales, up 22% sequentially and 60% over prior year
  • BOLI proceeds added $0.10 per share to second quarter earnings
  • 10% reduction in nonperforming assets and 27% decline in total credit costs from linked quarter
  • Repurchased 393,000 shares during second quarter of 2015      

“Loan growth, higher net interest income, expense management and improved credit quality contributed to a strong second quarter performance,” said William G. Smith, Jr., Chairman, President and CEO of Capital City Bank Group.  “We have experienced six consecutive quarters of loan growth and our portfolio has grown by more than $85 million since the end of 2013.  Growth in our loan and investment portfolios produced higher net interest income, and we remain focused on improving our operating efficiency by increasing revenues and lowering operating expenses.  To date, we have repurchased 411,000 shares of our common stock with the majority being purchased in the second quarter.”

Compared to the first quarter of 2015, performance reflects higher net interest income of $0.5 million, a $1.9 million increase in noninterest income, and lower noninterest expense of $0.9 million, that was partially offset by a $0.1 million increase in the loan loss provision and higher income taxes of $0.4 million.

Compared to the second quarter of 2014, the increase in earnings reflects higher net interest income of $0.5 million, a $1.5 million increase in noninterest income, lower noninterest expense of $0.6 million, and a $0.1 million reduction in the loan loss provision, partially offset by higher income taxes of $0.4 million.

The increase in earnings for the first six months of 2015 versus the comparable period in 2014 was attributable to higher net interest income of $0.8 million, a $1.5 million increase in noninterest income, and a $0.2 million reduction in the loan loss provision, partially offset by higher noninterest expense of $0.4 million and income taxes of $2.5 million.

The Return on Average Assets was 0.58% and the Return on Average Equity was 5.62% for the second quarter of 2015.  These metrics were 0.15% and 1.45% for the first quarter of 2015, and 0.23% and 2.09% for the second quarter of 2014, respectively.  For the first six months of 2015, the Return on Average Assets was 0.37% and the Return on Average Equity was 3.54% compared to 0.41% and 3.75%, respectively, for the first half of 2014.

Discussion of Operating Results

Tax equivalent net interest income for the second quarter of 2015 was $19.1 million compared to $18.6 million for the first quarter of 2015 and $18.6 million for the second quarter of 2014.  The increase in tax equivalent net interest income compared to the first quarter of 2015 reflects one additional calendar day and a positive shift in earning asset mix due to growth in the loan and investment portfolios, partially offset by unfavorable loan repricing.  The increase in tax equivalent net interest income compared to the second quarter of 2014 reflects a positive shift in earning asset mix due to growth in the loan and investment portfolios and a slight reduction in interest expense.  The lower interest expense is attributable to FHLB advance pay downs and favorable repricing on several non-maturity deposit products.  For the six months ended June 30, 2015, tax equivalent net interest income totaled $37.7 million compared to $37.0 million for the comparable period in 2014.  The year over year increase was driven by the same factors as noted above.

The extended low interest rate environment has put pressure on our net interest margin.  However, our asset portfolios are relatively short in duration and we believe we are well positioned to capitalize as the interest rate environment improves. 

The net interest margin for the second quarter of 2015 was 3.29%, an increase of two basis points over the first quarter of 2015 and unchanged from the second quarter of 2014.  The increase in the margin compared to the first quarter was attributable to growth in our loan and investment portfolios.  For the six months ended June 30, 2015, the net interest margin declined by one basis point to 3.28% compared to the same period of 2014, primarily attributable to unfavorable loan pricing.  It is important to note that net interest income is growing period over period and the lack of improvement in the net interest margin percentage is primarily attributable to the continued growth in average deposits, which is generally invested in overnight funds.

The provision for loan losses for the second quarter of 2015 was $0.4 million compared to $0.3 million for the first quarter of 2015 and $0.5 million for the second quarter of 2014.  For the first half of 2015, the loan loss provision totaled $0.7 million compared to $0.9 million for the same period of 2014.  The lower level of the year-to-date provision reflects continued favorable problem loan migration and improvement in key credit metrics.  Net charge-offs for the second quarter of 2015 totaled $1.2 million, or 0.33% (annualized), of average loans compared to $1.7 million, or 0.49% (annualized), for the first quarter of 2015 and $2.1 million, or 0.59% (annualized), for the second quarter of 2014.  For the first half of 2015, net charge-offs totaled $3.0 million, or 0.41% (annualized), of average loans compared to $3.4 million, or 0.49% (annualized), for the same period of 2014.  At quarter-end, the allowance for loan losses of $15.2 million was 1.03% of outstanding loans (net of overdrafts) and provided coverage of 99% of nonperforming loans compared to 1.10% and 96%, respectively, at March 31, 2015 and 1.22% and 105%, respectively, at December 31, 2014.

Noninterest income for the second quarter of 2015 totaled $14.8 million, an increase of $1.9 million, or 15.1%, over the first quarter of 2015 and $1.5 million, or 10.8%, over the second quarter of 2014.  The increase over the first quarter of 2015 was primarily attributable to bank owned life insurance (“BOLI”) proceeds of $1.7 million that is reflected in other income.  Higher mortgage banking fees of $0.2 million, bank card fees of $0.1 million, and deposit fees of $0.2 million also contributed to the increase and were partially offset by lower wealth management fees of $0.3 million.  The increase in mortgage fees was driven by continued strong new home purchase originations.  The increase in bank card fees was attributable to higher card spend by our clients and the increase in deposit fees reflects higher overdraft fees.  Wealth management fees declined due to lower trading volume by our clients.  Compared to the second quarter of 2014, the increase reflects higher other income of $1.6 million and mortgage banking fees of $0.5 million that were partially offset by lower deposit fees of $0.5 million and wealth management fees of $0.1 million.  The increase in other income, which was primarily due to the aforementioned BOLI proceeds, was partially offset by a lower level of miscellaneous recoveries.  Strong new home purchase originations and a higher margin on sold loans drove the increase in mortgage banking fees.  Deposit fees declined primarily due to lower overdraft fees and to a lesser extent maintenance fees.  Lower client trading activity drove the reduction in wealth management fees.         

For the first half of 2015, noninterest income totaled $27.6 million, a $1.5 million increase over the same period of 2014, primarily attributable to higher other income of $1.6 million and mortgage banking fees of $0.8 million, partially offset by lower deposit fees of $0.9 million.  The year-to-date variances are attributable to the same factors as noted above for the second quarter.   

Noninterest expense for the second quarter of 2015 totaled $28.4 million, a decrease of $0.9 million, or 3.2%, from the first quarter of 2015 attributable to lower other real estate owned (“OREO”) expense of $0.6 million, compensation expense of $0.1 million, occupancy expense of $0.1 million, and other expense of $0.1 million.  A lower level of net losses from the sale of properties and to a lesser extent lower valuation adjustments drove the reduction in OREO expense.  The decrease in occupancy expense was attributable to lower building and equipment maintenance costs.  Other expense decreased due to lower processing fees which were higher than normal in the first quarter of 2015 due to the implementation of a new on-line/mobile banking platform.  Compared to the second quarter of 2014, noninterest expense decreased by $0.6 million or 2.2% attributable to lower OREO expense of $1.3 million, occupancy expense of $0.2 million and other expense of $0.2 million, partially offset by higher compensation expense of $1.1 million.  The reduction in OREO expense was driven by a lower level of net losses from the sale of properties.  The lower level of occupancy expense primarily reflects non-routine maintenance expenses realized in the second quarter of 2014.  Lower legal fees drove the decrease in other expense and reflect a lower level of support needed for problem loan resolutions.  The increase in compensation expense reflects higher pension plan expense of $0.6 million, performance based pay (commissions and incentives) of $0.4 million, and associate salaries of $0.1 million.        

For the first six months of 2015, noninterest expense totaled $57.8 million, an increase of $0.4 million, or 0.7%, over the same period of 2014 attributable to higher compensation expense of $1.9 million that was partially offset by lower OREO expense of $1.2 million, occupancy expense of $0.1 million, and other expense of $0.2 million.  The increase in compensation expense reflects higher pension plan expense of $1.3 million, performance based pay (commissions) of $0.3 million, and associate salaries of $0.3 million.  The increase in our pension plan expense compared to both the three and six-month prior year periods is primarily attributable to the utilization of a lower discount rate in 2015 for determining plan liabilities reflective of a decrease in long-term bond interest rates.  A revision to the mortality tables used to calculate pension liabilities also contributed to the increase, but to a lesser extent.  The reduction in OREO expense was primarily attributable to lower net losses from the sale of properties and to a lesser extent lower property carrying costs and valuation adjustments.  Lower technology equipment costs drove the decrease in occupancy expense.  The decrease in other expense reflects lower legal fees, printing and supply costs, and postage costs.     

We realized income tax expense of $1.1 million (23% effective rate) for the second quarter of 2015 compared to $0.7 million (41% effective rate) for the first quarter of 2015 and $0.7 million (33% effective rate) for the second quarter of 2014.  For the first six months of 2015, income tax expense totaled $1.8 million (27% effective rate) compared to an income tax benefit of $0.7 million (-15% effective rate) for the comparable period of 2014.  The aforementioned discrete BOLI transaction realized in the second quarter of 2015 was tax-free, therefore income tax expense for the three and six-months of 2015 were favorably impacted.  Income taxes for the three and six-months of 2014 were favorably impacted by a $2.2 million state tax benefit attributable to an adjustment in our reserve for uncertain tax positions associated with prior year matters.  Absent future discrete events, we anticipate our effective income tax rate for the second half of 2015 will normalize within a range of 34%-35%.
        
Discussion of Financial Condition

Average earning assets were $2.328 billion for the second quarter of 2015, an increase of $21.5 million, or 0.9%, over the first quarter of 2015 and $115.2 million, or 5.2%, over the fourth quarter of 2014.  The increase in earning assets from the first quarter 2015 reflects higher levels of noninterest bearing and savings accounts, partially offset by a lower level of public funds.  The increase compared to the fourth quarter of 2014 reflects higher levels for all deposit products with the exception of money market accounts and certificates of deposit.  Additionally, growth in both the loan and investment portfolios led to a more favorable earning asset mix.

We maintained an average net overnight funds (deposits with banks plus fed funds sold less fed funds purchased) sold position of $237.1 million during the second quarter of 2015 compared to an average net overnight funds sold position of $302.4 million in the first quarter of 2015 and an average overnight funds sold position of $288.6 million in the fourth quarter of 2014.  The decrease in overnight funds compared to the prior quarter reflects growth in both the loan and investment portfolios.  Partially offsetting this decline was an increase in average deposit balances despite a decline in public funds.  The decrease relative to the fourth quarter of 2014 is primarily attributable to growth in both the loan and investment portfolios, partially offset by an increase in average deposits.

Although we have experienced loan growth for the last six quarters, we continue to work on lowering the level of overnight funds by adding to our investment portfolio with short-duration, high quality securities and reducing deposit balances.  We offer to our clients a fully-insured money market account which is provided by a third party and can serve as an alternative investment for some of our higher balance depositors while at the same time allowing us to maintain the account relationship.  Until such time that attractive investment alternatives arise, we will continue to execute these strategies as well as seek other initiatives in an effort to better deploy our overnight fund balances.  

Average loans increased $25.3 million, or 1.8%, when compared to the first quarter of 2015, and have grown $47.2 million, or 3.3% compared to the fourth quarter of 2014.  The improvement in loans was primarily driven by increases in the consumer portfolio, commercial loans, and commercial mortgages.  

Without compromising our credit standards or taking on inordinate interest rate risk, we have modified several lending programs in our business (commercial real estate and consumer portfolios) to try to mitigate the significant impact that consumer and business deleveraging is having on our portfolio.  These programs, coupled with economic improvements in our anchor markets, have helped to increase overall production.

Nonperforming assets (nonaccrual loans and OREO) totaled $45.5 million at the end of the second quarter of 2015, a decrease of $5.1 million from the first quarter of 2015 and $7.0 million from the fourth quarter of 2014.  Nonaccrual loans totaled $15.3 million at the end of the second quarter of 2015, a decrease of $1.5 million from both the first quarter of 2015 and fourth quarter of 2014.  Nonaccrual loan additions totaled $4.5 million in the second quarter of 2015 and $10.3 million for the first six months of 2015, which compares to $11.9 million for the same period of 2014.  The balance of OREO totaled $30.2 million at the end of the second quarter of 2015, a decrease of $3.6 million and $5.5 million, respectively, from the first quarter of 2015 and fourth quarter of 2014.  For the second quarter of 2015, we added properties totaling $1.1 million, sold properties totaling $4.0 million, recorded valuation adjustments totaling $0.5 million, and realized miscellaneous adjustments of $0.2 million.  For the first six months of 2015, we added properties totaling $2.8 million, sold properties totaling $6.8 million, recorded valuation adjustments totaling $1.3 million, and realized miscellaneous adjustments of $0.3 million.  Nonperforming assets represented 1.71% of total assets at June 30, 2015 compared to 1.88% at March 31, 2015 and 2.00% at December 31, 2014.

Average total deposits were $2.178 billion for the second quarter of 2015, an increase of $15.0 million, or 0.7%, over the first quarter of 2015 and an increase of $101.0 million, or 4.9%, over the fourth quarter of 2014.  The increase in deposits when compared to the first quarter of 2015 reflects higher levels of all non-maturity account types except NOW accounts, partially offset by declines in public fund deposits and certificates of deposit.  The higher level of deposits when compared to the fourth quarter of 2014 is primarily attributable to increased balances of noninterest bearing, public NOW and savings accounts, partially offset by a decline in money market accounts and certificates of deposit.  The seasonal inflows of public funds began in the fourth quarter of 2014, most likely peaked in the second quarter of 2015, and are expected to decline into the fourth quarter of 2015.

Deposit levels remain strong and our mix of deposits continues to improve as higher cost certificates of deposit are replaced with lower rate non-maturity deposits and noninterest bearing demand accounts.  Prudent pricing discipline will continue to be the key to managing our mix of deposits.  Therefore, we do not attempt to compete with higher rate paying competitors for deposits. 

When compared to the first quarter of 2015 and fourth quarter of 2014, average borrowings increased by $3.7 million and $6.7 million, respectively, attributable to higher levels of repurchase agreement balances, partially offset by FHLB advance pay downs.

Equity capital was $272.0 million as of June 30, 2015, compared to $274.1 million as of March 31, 2015 and $272.5 million as of December 31, 2014.  Our leverage ratio was 10.57%, 10.73%, and 10.99%, respectively, for these periods.  Further, as of June 30, 2015, our risk-adjusted capital ratio was 16.75% compared to 17.11% and 17.76% at March 31, 2015 and December 31, 2014, respectively.  Our common equity tier 1 ratio was 12.31% as of June 30, 2015 compared to 12.57% as of March 31, 2015, which was the first reporting period this ratio was published under the Basel III capital standards.  All of our capital ratios significantly exceed the threshold to be designated as “well-capitalized” under the Basel III capital standards.  The reduction in our regulatory capital ratios in 2015 reflects the implementation of Basel III and the repurchase of common stock.  During 2015, we have repurchased approximately 393,000 shares of our common stock at an average price of $14.72 per share.               

About Capital City Bank Group, Inc.

Capital City Bank Group, Inc. (Nasdaq:CCBG) is one of the largest publicly traded financial holding companies headquartered in Florida and has approximately $2.7 billion in assets.  The Company provides a full range of banking services, including traditional deposit and credit services, mortgage banking, asset management, trust, merchant services, bankcards, data processing and securities brokerage services.  The Company's bank subsidiary, Capital City Bank, was founded in 1895 and now has 63 full-service offices and 71 ATMs in Florida, Georgia and Alabama.  For more information about Capital City Bank Group, Inc., visit www.ccbg.com.

FORWARD-LOOKING STATEMENTS

Forward-looking statements in this Press Release are based on current plans and expectations that are subject to uncertainties and risks, which could cause the Company’s future results to differ materially.  The following factors, among others, could cause the Company’s actual results to differ: the accuracy of the Company’s financial statement estimates and assumptions; legislative or regulatory changes, including the Dodd-Frank Act, Basel III, and the ability to repay and qualified mortgage standards; the strength of the U.S. economy and the local economies where the Company conducts operations; the effects of the Company’s lack of a diversified loan portfolio, including the risks of geographic and industry concentrations; harsh weather conditions and man-made disasters; fluctuations in inflation, interest rates, or monetary policies; changes in the stock market and other capital and real estate markets; customer acceptance of third-party products and services; increased competition and its effect on pricing, including the long-term impact on our net interest margin from the repeal of Regulation Q; negative publicity and the impact on our reputation; technological changes, especially changes that allow out of market competitors to compete in our markets; the effects of security breaches and computer viruses that may affect the Company’s computer systems or fraud related to debit card products; changes in consumer spending and savings habits; the Company’s growth and profitability; changes in accounting; and the Company’s ability to manage the risks involved in the foregoing.  Additional factors can be found in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2014, and the Company’s other filings with the SEC, which are available at the SEC’s internet site (http://www.sec.gov).  Forward-looking statements in this Press Release speak only as of the date of the Press Release, and the Company assumes no obligation to update forward-looking statements or the reasons why actual results could differ.

            
CAPITAL CITY BANK GROUP, INC.           
EARNINGS HIGHLIGHTS           
Unaudited           
            
  Three Months Ended
 Six Months Ended 
(Dollars in thousands, except per share data) Jun 30, 2015 Mar 31, 2015 Jun 30, 2014 Jun 30, 2015 Jun 30, 2014 
            
EARNINGS           
Net Income$ 3,845 $ 986 $ 1,473 $ 4,831 $ 5,224  
Net Income Per Common Share$   0.22 $   0.06 $   0.08 $   0.28 $   0.30  
PERFORMANCE           
Return on Average Assets  0.58%  0.15%  0.23%  0.37%  0.41% 
Return on Average Equity  5.62%  1.45%  2.09%  3.54%  3.75% 
Net Interest Margin  3.29%  3.27%  3.29%  3.28%  3.29% 
Noninterest Income as % of Operating Revenue 43.80%  40.98%  41.99%  42.44%  41.57% 
Efficiency Ratio  83.85%  93.42%  91.11%  88.46%  91.00% 
CAPITAL ADEQUACY           
Tier 1 Capital Ratio  15.86%  16.16%  16.85%  15.86%  16.85% 
Total Capital Ratio  16.75%  17.11%  18.10%  16.75%  18.10% 
Tangible Common Equity Ratio  7.29%  7.26%  7.93%  7.29%  7.93% 
Leverage Ratio  10.57%  10.73%  10.70%  10.57%  10.70% 
Common Equity Tier 1 Ratio  12.31%  12.57%    -    12.31%    -   
Equity to Assets  10.25%  10.18%  10.97%  10.25%  10.97% 
ASSET QUALITY           
Allowance as % of Non-Performing Loans  99.46%  95.83%  80.03%  99.46%  80.03% 
Allowance as a % of Loans  1.03%  1.10%  1.45%  1.03%  1.45% 
Net Charge-Offs as % of Average Loans  0.33%  0.49%  0.59%  0.41%  0.49% 
Nonperforming Assets as % of Loans and ORE  3.00%  3.38%  4.67%  3.00%  4.67% 
Nonperforming Assets as % of Total Assets  1.71%  1.88%  2.66%  1.71%  2.66% 
STOCK PERFORMANCE           
High $ 16.32 $ 16.33 $ 14.71 $ 16.33 $ 14.71  
Low  13.94   13.16   12.60   13.16   11.56  
Close  15.27   16.25   14.53   15.27   14.53  
Average Daily Trading Volume$ 33,514 $ 15,058 $ 28,428 $ 24,435 $ 32,114  
            

 

CAPITAL CITY BANK GROUP, INC.           
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
 
Unaudited           
            
   2015   2014  
(Dollars in thousands) Second Quarter First
Quarter
 Fourth Quarter Third Quarter Second Quarter 
ASSETS           
Cash and Due From Banks$   61,484  $    51,948  $    55,467  $    50,049  $    63,956  
Funds Sold and Interest Bearing Deposits    185,572     296,888     329,589     253,974     354,233  
Total Cash and Cash Equivalents    247,056     348,836     385,056     304,023     418,189  
            
Investment Securities Available for Sale    433,688     404,887     341,548     322,297     275,082  
Investment Securities Held to Maturity    201,805     183,489     163,581     173,188     180,393  
Total Investment Securities    635,493     588,376     505,129     495,485     455,475  
            
Loans Held for Sale    10,991     13,334     10,688     8,700     13,040  
            
Loans, Net of Unearned Interest           
Commercial, Financial, & Agricultural    151,116     143,951     136,925     133,756     134,833  
Real Estate - Construction    44,216     41,595     41,596     38,121     34,244  
Real Estate - Commercial    510,962     507,681     510,120     501,863     518,580  
Real Estate - Residential    284,333     287,481     289,952     302,791     298,647  
Real Estate - Home Equity    230,388     228,171     229,572     228,968     228,232  
Consumer    238,599     230,984     214,758     200,363     181,209  
Other Loans    12,048     9,243     6,017     5,504     7,182  
Overdrafts    2,603     2,348     2,434     3,009     2,664  
Total Loans, Net of Unearned Interest    1,474,265    1,451,454    1,431,374    1,414,375    1,405,591  
Allowance for Loan Losses    (15,236)    (16,090)    (17,539)    (19,093)    (20,543) 
Loans, Net  1,459,029    1,435,364    1,413,835    1,395,282    1,385,048  
            
Premises and Equipment, Net    99,108     100,038     101,899     102,546     102,141  
Goodwill    84,811     84,811     84,811     84,811     84,811  
Other Real Estate Owned    30,167     33,835     35,680     41,726     42,579  
Other Assets    87,489     89,121     90,071     67,044     66,209  
Total Other Assets    301,575     307,805     312,461     296,127     295,740  
            
Total Assets$   2,654,144  $   2,693,715  $   2,627,169  $   2,499,617  $   2,567,492  
            
LIABILITIES           
Deposits:           
Noninterest Bearing Deposits$   723,866  $    707,470  $    659,115  $    667,616  $    689,844  
NOW Accounts    734,237     801,037     804,337     665,493     712,385  
Money Market Accounts    264,475     257,684     254,149     270,131     272,255  
Regular Savings Accounts    255,185     250,862     233,612     231,301     227,470  
Certificates of Deposit    186,881     192,961     195,581     199,037     206,496  
Total Deposits    2,164,644    2,210,014    2,146,794    2,033,578    2,108,450  
            
Short-Term Borrowings    53,698     49,488     49,425     42,586     36,732  
Subordinated Notes Payable    62,887     62,887     62,887     62,887     62,887  
Other Long-Term Borrowings    29,733     30,418     31,097     32,305     33,282  
Other Liabilities    71,144     66,821     64,426     45,008     44,561  
            
Total Liabilities    2,382,106    2,419,628    2,354,629    2,216,364    2,285,912  
            
SHAREOWNERS' EQUITY           
Common Stock    172     175     174     174     174  
Additional Paid-In Capital    37,625     42,941     42,569     41,637     41,628  
Retained Earnings    255,096     251,765     251,306     249,907     248,142  
Accumulated Other Comprehensive Loss, Net of Tax    (20,855)    (20,794)    (21,509)    (8,465)    (8,364) 
            
Total Shareowners' Equity    272,038     274,087     272,540     283,253     281,580  
            
Total Liabilities and Shareowners' Equity$  2,654,144  $   2,693,715  $   2,627,169  $   2,499,617  $    2,567,492  
            
OTHER BALANCE SHEET DATA           
Earning Assets$   2,306,322  $    2,350,052  $    2,276,781  $    2,172,535  $    2,228,339  
Interest Bearing Liabilities   1,587,096    1,645,337    1,631,088    1,503,740     1,551,507  
            
Book Value Per Diluted Share$ 15.80 $ 15.59 $ 15.53 $ 16.18 $ 16.08  
Tangible Book Value Per Diluted Share  10.87   10.77   10.70   11.33   11.24  
            
Actual Basic Shares Outstanding  17,154   17,533   17,447   17,433   17,449  
Actual Diluted Shares Outstanding  17,216   17,579   17,544   17,512   17,510  
            

 

CAPITAL CITY BANK GROUP, INC.               
CONSOLIDATED STATEMENT OF OPERATIONS  
Unaudited               
                
            Six Months Ended 
  2015 2014 June 30, 
(Dollars in thousands, except per share data) Second Quarter First Quarter Fourth Quarter Third Quarter Second Quarter 2015  2014  
                
INTEREST INCOME               
Interest and Fees on Loans$18,231 $   17,863 $   18,624 $   18,528 $   18,152 $  36,094 $   36,250  
Investment Securities   1,451   1,294   1,066   1,034   939   2,745    1,786  
Funds Sold   151   189   181   204   257   340    548  
Total Interest Income  19,833  19,346  19,871  19,766  19,348  39,179   38,584  
                
INTEREST EXPENSE               
Deposits   259   246   243   255   293   505    601  
Short-Term Borrowings   15   21   24   17   17   36    37  
Subordinated Notes Payable   338   332   333   333   331   670    662  
Other Long-Term Borrowings   237   240   252   263   269   477    560  
Total Interest Expense   849   839   852   868   910   1,688    1,860  
Net Interest Income   18,984   18,507   19,019   18,898   18,438  37,491   36,724  
Provision for Loan Losses   375   293   623   424   499   668    858  
Net Interest Income after Provision for Loan Losses  18,609   18,214   18,396   18,474   17,939   36,823    35,866  
                
NONINTEREST INCOME               
Deposit Fees   5,682   5,541   6,027   6,211   6,213  11,223   12,082  
Bank Card Fees   2,844   2,742   2,658   2,707   2,820   5,586    5,527  
Wealth Management Fees   1,776   2,046   1,988   2,050   1,852   3,822    3,770  
Mortgage Banking Fees   1,203   987   808   911   738   2,190    1,363  
Data Processing Fees   364   373   278   336   388   737    929  
Other    2,925   1,159   1,294   1,136   1,336   4,084    2,461  
Total Noninterest Income  14,794  12,848  13,053  13,351  13,347  27,642   26,132  
                
NONINTEREST EXPENSE               
Compensation   16,404   16,524   15,850   15,378   15,206  32,928   30,987  
Occupancy, Net   4,258   4,396   4,440   4,575   4,505   8,654    8,803  
Other Real Estate   931   1,497   1,353   1,783   2,276   2,428    3,675  
Other    6,846   6,973   6,666   6,871   7,089  13,819   13,977  
Total Noninterest Expense   28,439   29,390   28,309   28,607   29,076  57,829   57,442  
                
OPERATING PROFIT   4,964   1,672   3,140   3,218   2,210   6,636    4,556  
Income Tax Expense (Benefit)   1,119   686   1,219   1,103   737   1,805    (668) 
NET INCOME$  3,845 $   986 $   1,921 $   2,115 $   1,473 $   4,831 $    5,224  
                
PER SHARE DATA               
Basic Income$0.22$0.06$0.11$0.12$0.08$0.28$ 0.30  
Diluted Income$0.22$0.06$0.11$0.12$0.08$0.28$ 0.30  
Cash Dividend $0.03$0.03$0.03$0.02$0.02$0.06$ 0.04  
AVERAGE SHARES               
Basic  17,296 17,508 17,433 17,440 17,427 17,402  17,413  
Diluted  17,358 17,555 17,530 17,519 17,488 17,456  17,463  
                

 

CAPITAL CITY BANK GROUP, INC.            
ALLOWANCE FOR LOAN LOSSES             
AND RISK ELEMENT ASSETS            
Unaudited            
             
   2015   2015   2014   2014   2014   
(Dollars in thousands, except per share data) Second Quarter First Quarter Fourth Quarter Third Quarter Second Quarter  
             
ALLOWANCE FOR LOAN LOSSES            
Balance at Beginning of Period$ 16,090 $ 17,539 $ 19,093 $ 20,543 $ 22,110   
Provision for Loan Losses  375   293   623   424   499   
Net Charge-Offs  1,229   1,742   2,177   1,874   2,066   
Balance at End of Period$ 15,236 $ 16,090 $ 17,539 $ 19,093 $ 20,543   
As a % of Loans  1.03%  1.10%  1.22%  1.34%  1.45%  
As a % of Nonperforming Loans  99.46%  95.83%  104.60%  81.31%  80.03%  
             
CHARGE-OFFS            
Commercial, Financial and Agricultural$ 239 $ 290 $ 688 $ 86 $ 86   
Real Estate - Construction    -      -      28     -      -    
Real Estate - Commercial  285   904   957   1,208   1,029   
Real Estate - Residential  484   305   522   212   695   
Real Estate - Home Equity  454   182   (20)  621   375   
Consumer  351   576   608   386   421   
Total Charge-Offs$ 1,813 $ 2,257 $ 2,783 $ 2,513 $ 2,606   
             
RECOVERIES            
Commercial, Financial and Agricultural$ 82 $ 55 $ 66 $ 28 $ 45   
Real Estate - Construction    -      -      2     2     1   
Real Estate - Commercial  54   30   76   213   152   
Real Estate - Residential  200   48   212   93   52   
Real Estate - Home Equity  33   24   28   37   65   
Consumer  215   358   222   266   225   
Total Recoveries$ 584 $ 515 $ 606 $ 639 $ 540   
             
NET CHARGE-OFFS$ 1,229 $ 1,742 $ 2,177 $ 1,874 $ 2,066   
             
Net Charge-Offs as a % of Average Loans(1)  0.33%  0.49%  0.61%  0.52%  0.59%  
             
RISK ELEMENT ASSETS            
Nonaccruing Loans$ 15,320 $ 16,790 $ 16,769 $ 23,482 $ 25,670   
Other Real Estate Owned  30,167   33,835   35,680   41,726   42,579   
Total Nonperforming Assets$ 45,487 $ 50,625 $ 52,449 $ 65,208 $ 68,249   
             
Past Due Loans 30-89 Days $   5,858  $    3,689  $    6,792  $    4,726  $    5,092   
Past Due Loans 90 Days or More    -      -      -      62     -    
Classified Loans    69,152     74,247     83,137     89,850     95,037   
Performing Troubled Debt Restructuring's$ 41,632 $ 42,590 $ 44,409 $ 43,578 $ 45,440   
             
Nonperforming Loans as a % of Loans  1.03%  1.15%  1.16%  1.65%  1.81%  
Nonperforming Assets as a % of            
  Loans and Other Real Estate  3.00%  3.38%  3.55%  4.45%  4.67%  
Nonperforming Assets as a % of Total Assets  1.71%  1.88%  2.00%  2.61%  2.66%  
             
(1) Annualized            
             

 

CAPITAL CITY BANK GROUP, INC.                           
AVERAGE BALANCE AND INTEREST RATES(1)                           
Unaudited                                                 
                                                  
                                                  
  Second Quarter 2015  First Quarter 2015  Fourth Quarter 2014  Third Quarter 2014  Second Quarter 2014  Jun 2015 YTD
  Jun 2014 YTD
  
(Dollars in thousands) Average
Balance
 Interest Average
Rate
  Average
Balance
 Interest Average
Rate
  Average
Balance
 Interest Average
Rate
  Average
Balance
 Interest Average
Rate
  Average
Balance
 Interest Average
Rate
 Average
Balance
 Interest Average
Rate
  Average
Balance
 Interest Average
Rate
  
ASSETS:                                                 
Loans, Net of Unearned Interest$   1,473,954    18,285 4.98%$   1,448,617    17,909 5.01%$   1,426,756    18,670 5.19%$   1,421,327    18,590 5.19%$   1,411,988    18,216 5.17%   1,461,356    36,194 4.99%$  1,403,793    36,377 5.23% 
                                                  
Investment Securities                                                 
Taxable Investment Securities    540,735    1,313 0.97     491,637    1,198 0.98     423,136    964 0.90     387,966    929 0.95     345,798    822 0.95    516,321    2,511 0.95     318,521    1,530 0.93  
Tax-Exempt Investment Securities  76,191  219 1.15   63,826  154 0.96   74,276  161 0.87   82,583  165 0.80   94,431  182 0.77  70,043  373 1.06   104,431  396 0.76  
                                                  
Total Investment Securities    616,926    1,532 0.99     555,463    1,352 0.98     497,412    1,125 0.90     470,549    1,094 0.92     440,229    1,004 0.91    586,364    2,884 0.99     422,952    1,926 0.91  
                                                  
Funds Sold  237,132  151 0.26   302,405  189 0.25   288,613  181 0.25   317,553  204 0.25   408,668  257 0.25  269,588  340 0.25   437,837  548 0.25  
                                                  
Total Earning Assets    2,328,012 $19,968 3.44%    2,306,485 $19,450 3.42%    2,212,781 $19,976 3.58%    2,209,429 $19,888 3.57%    2,260,885 $19,477 3.46%   2,317,308 $39,418 3.43%   2,264,582 $38,851 3.46% 
                                                  
Cash and Due From Banks    52,473          48,615          45,173          44,139          44,115         50,555          46,089       
Allowance for Loan Losses    (16,070)         (17,340)         (19,031)         (20,493)         (22,255)        (16,702)         (22,730)      
Other Assets  306,286        310,791        310,813        297,496        296,248       308,526        300,656       
                                                  
Total Assets$ 2,670,701      $ 2,648,551      $ 2,549,736      $ 2,530,571      $ 2,578,993       2,659,687      $ 2,588,597       
                                                  
LIABILITIES:                                                 
Interest Bearing Deposits                                                 
NOW Accounts$   761,388 $  64 0.03%$   794,308 $  68 0.03%$   689,572 $  57 0.03%$   680,154 $  66 0.04%$   724,635 $  91 0.05%   777,757 $  132 0.03%$   747,343 $  195 0.05% 
Money Market Accounts    256,265    32 0.05     254,483    41 0.07     267,703    46 0.07     270,133    46 0.07     280,619    50 0.07    255,378    73 0.06     277,335    98 0.07  
Savings Accounts    253,808    31 0.05     242,256    30 0.05     233,161    29 0.05     228,741    29 0.05     227,960    28 0.05    248,064    61 0.05     223,418    54 0.05  
Time Deposits  189,213  132 0.28   194,655  107 0.22   197,129  111 0.22   202,802  114 0.22   209,558  124 0.24  191,919  239 0.25   212,408  254 0.24  
Total Interest Bearing Deposits    1,460,674    259 0.07%    1,485,702    246 0.07%    1,387,565    243 0.07%    1,381,830    255 0.07%    1,442,772    293 0.08%   1,473,118    505 0.07%   1,460,504    601 0.08% 
                                                  
Short-Term Borrowings    54,237    15 0.11%    49,809    21 0.17%    46,055    24 0.21%    40,782    17 0.17%    44,473    17 0.15%   52,035    36 0.14%    45,402    37 0.16% 
Subordinated Notes Payable    62,887    338 2.13     62,887    332 2.11     62,887    333 2.07     62,887    333 2.07     62,887    331 2.08    62,887    670 2.12     62,887    662 2.09  
Other Long-Term Borrowings  30,067  237 3.16   30,751  240 3.16   31,513  252 3.17   32,792  263 3.20   33,619  269 3.21  30,407  477 3.16   35,328  560 3.19  
                                                  
Total Interest Bearing Liabilities    1,607,865 $849 0.21%    1,629,149 $839 0.21%    1,528,020 $852 0.22%    1,518,291 $868 0.23%    1,583,751 $910 0.23%   1,618,447 $1,688 0.21%   1,604,121 $1,860 0.23% 
                                                  
Noninterest Bearing Deposits    717,725          677,674          689,800          681,051          666,791         697,811          656,715       
Other Liabilities  70,690        66,424        45,887        47,099        46,105       68,569        46,716       
                                                  
Total Liabilities  2,396,280        2,373,247        2,263,707        2,246,441        2,296,647       2,384,827        2,307,552       
                                                  
SHAREOWNERS' EQUITY:  274,421        275,304        286,029        284,130        282,346       274,860        281,045       
                                                  
Total Liabilities and Shareowners' Equity$ 2,670,701      $ 2,648,551      $ 2,549,736      $ 2,530,571      $ 2,578,993       2,659,687      $ 2,588,597       
                                                  
Interest Rate Spread  $19,119 3.23%  $18,611 3.21%  $19,124 3.36%  $19,020 3.34%  $18,567 3.22% $37,730 3.22%  $36,991 3.23% 
                                                  
Interest Income and Rate Earned(1)   19,968 3.44    19,450 3.42    19,976 3.58    19,888 3.57    19,477 3.46   39,418 3.43    38,851 3.46  
Interest Expense and Rate Paid(2)   849 0.15    839 0.15    852 0.15    868 0.16    910 0.16   1,688 0.15    1,860 0.17  
                                                  
Net Interest Margin  $19,119 3.29%  $18,611 3.27%  $19,124 3.43%  $19,020 3.42%  $18,567 3.29% $37,730 3.28%  $36,991 3.29% 
                                                  
(1)  Interest and average rates are calculated on a tax-equivalent basis using the 35% Federal tax rate.  
(2)  Rate calculated based on average earning assets.  
                                                  
For Information Contact:
J. Kimbrough Davis
Executive Vice President and Chief Financial Officer
850.402.7820
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