Seacoast Banking Corporation Of Florida · NASDAQ:SBCF
Seacoast Banking Corporation Of Florida — Seacoast Banking Corp of Florida — Q3 2016 Earnings Presentation
45 slides from Seacoast Banking Corporation Of Florida's earnings presentation, Nov 1, 2016
Slide 1: Investor Presentation Q3 2016
Investor Presentation Q3 - 2016 Contact : (email) Steve.Fowle@SeacoastBank.com (phone) 772.463.8977 (web) www.Sea coa stBanking.com
Slide 2: Forward-looking statements
This presentation contains “forward - looking statements” within the meaning of Section 27 A of the Securities Act of 1933 and Section 21 E of the Securities Exchange Act of 1934 , including, without limitation, statements about future financial and operating results, ability to realized deferred ta
Slide 3: Agenda
Agenda • About Seacoast Bank • Seacoast’s Investment Thesis – Successfully Executing a Differentiated Strategy for Balanced Growth • 2016 Outlook • Company Performance • Appendix Investor Presentation 3
Slide 4: About Seacoast Bank
Agenda • $4.5B assets bank operating in the nation’s third most - populous state • Strong and growing presence in two of Florida’s most attractive MSAs • Top 10 bank in Orlando • Growing share in West Palm Beach • #1 share in Port St Lucie MSA, 8 th largest market in Florida • Investing in digital t
Slide 5: Investment Thesis
Agenda Investment Thesis Successfully Executing a Differentiated Strategy to Deliver Balanced Growth 5 Investor Presentation x Reaping benefits of strategic investments in organic growth and digital transformation x Track record of completing val ue - creating acquisitions in growing markets x Robus
Slide 6: Third Quarter 2016 Results Demonstrate Effectiveness of Balanced Growth Strategy
$6.2 $10.6 $0 $2 $4 $6 $8 $10 $12 3Q 15 3Q 16 Third Quarter 2016 Results Demonstrate the Effectiveness of Seacoast’s Balanced Growth Strategy 6 Investor Presentation 1. See appendix for definition of non - GAAP metrics Key metrics continue to improve even as we prudently manage CRE exposures and inv
Slide 7: Third Quarter 2016 Performance Metrics
8.2% 12.6% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 3Q 15 3Q 16 68.2% 63.1% 60.0% 62.0% 64.0% 66.0% 68.0% 70.0% 3Q 15 3Q 16 0.77% 0.95% 0.50% 0.55% 0.60% 0.65% 0.70% 0.75% 0.80% 0.85% 0.90% 0.95% 1.00% 3Q 15 3Q 16 Third Quarter 2016 Results Demonstrate the Effectiveness of Seacoast’s Balanced Grow
Slide 8: Agenda
Agenda • About Seacoast Bank • Seacoast’s Investment Thesis – Successfully Executing a Differentiated Strategy for Balanced Growth • 2016 Outlook • Company Performance • Appendix Investor Presentation 8
Slide 9: Investment Thesis: Organic Growth and Digital Transformation
Agenda Investment Thesis Successfully Executing a Differentiated Strategy for Balanced Growth 9 Investor Presentation x Reaping benefits of strategic investments in organic growth and digital transformation • Leader in organic customer acquisition, deepening customer relationships and shifting routi
Slide 10: Seacoast Is Growing Its Customer Base Organically and Via Acquisitions
$0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 Jan-14 May-14 Sep-14 Jan-15 May-15 Sep-15 Jan-16 May-16 Sep-16 50 55 60 65 70 75 80 85 90 95 100 Jan-14 May-14 Sep-14 Jan-15 May-15 Sep-15 Jan-
Slide 11: Focus On Business Banking Driving Growth in Loans
□ Focused on businesses with revenues $5mm+ in specific industry verticals □ Five offices in key metro areas of Florida (three in South Florida, two in Orlando) □ Comprehensive relationship approach: business, treasury, lending, wealth Seacoast’s Focus On Business B anking Is Driving Significant Gro
Slide 12: Proven Ability to Deepen Relationships With Existing Customers
Seacoast Has a Proven Ability to Deepen Relationships With Existing Customers 12 Investor Presentation Growth in Loans Up 243% Since YE ‘13 Growth in Deposit Accounts Up 121% Since YE ‘13 Growth in Debit Cards Up 95% Since YE ‘13 $6.5mm in incremental net interest income 1 $3.3mm+ in incremental rev
Slide 13: Non-Branch Servicing Is Key Component of Transformation Strategy
50,000 80,000 110,000 140,000 170,000 200,000 230,000 260,000 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Teller Non-Teller Non - Branch Servicing Is A Key Component of Our Transformation Strategy 13 Investor Presentation 81% 19% 0%
Slide 14: Growing While Rationalizing Branches
$1,759 $1,806 $2,417 $2,844 $3,653 $49 $53 $56 $66 $78 $40 $45 $50 $55 $60 $65 $70 $75 $80 $85 $90 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 2012 2013 2014 2015 2016 Total Deposits (mm) Deposits Per Branch(mm) As a Result, Seacoast Is Growing While Rationalizing Branches Seacoast continu
Slide 15: Investment Thesis: Value-Creating Acquisitions
Agenda Investment Thesis Successfully Executing a Differentiated Strategy for Balanced Growth 15 Investor Presentation x Reaping benefits of strategic investments in organic growth and transformation x Track record of completing value - creating acquisitions • Opportunistic deals that expand our foo
Slide 16: BankFIRST and Grand Bank Acquisitions
BankFIRST Acquired October 2014 • IRR exceeded internal target of 19% • HH growth in acquired branches = +13% • Customer growth highlights • Avg Services = +28% • Consumer Installment Loans = +76% • Consumer Lines of Credit = +23% • Debit Cards = +15% • Mobile Banking = +297% Grand Bank Acquired Jul
Slide 17: Recent Acquisitions: Top 10 Bank in Orlando
BMO Harris Orlando Acquired June 2016 • Further strengthened franchise in Orlando, including business banking • Compelling f inancial m etrics announced and on t rack: - IRR in excess of 20% - More than 6% accretive to 2016 EPS • Acquisition closed and converted in June 2016 Cost savings completed i
Slide 18: Investment Thesis: Robust Risk Management
Agenda Investment Thesis Successfully Executing a Differentiated Strategy for Balanced Growth 18 Investor Presentation x Reaping benefits of strategic investments in organic growth and transformation x Track record of completing value - creating acquisitions x Robust risk management and controls hel
Slide 19: Conservative Risk Profile
Seacoast Conservative Risk Profile Well Positioned for Sustainable Value Creation… 19 Investor Presentation 40% 131% From $1.21B To $2.79B Average Loan Size - Commercial Total Loan Portfolio Percentage Change Change in Dollars Loan Growth FY ‘11 – Q3 ‘16 From $567K To $ 342K Top 10 loan relationship
Slide 20: Approach to CRE Different Than Florida Peers
…and Our A pproach to CRE is Very D ifferent T han Florida P eers 20 Investor Presentation CRE loans as a percent of total capital remain relatively flat and intentionally below Florida peers . (197% vs 287% peer median) 180% 235% 197% 287% 100% 150% 200% 250% 300% 350% SBCF Florida Peers Q2 2015 Q2
Slide 21: Balanced Growth Strategy Produced ROTCE of 12.6%
FCB Finl Hldgs CenterState Bks Stonegate Bank State Bk Finl Corp BankUnited Inc Capital City Bank Home BcShrs Inc Cardinal Financial Sterling Bncp Ameris Bancorp Eagle Bancorp Valley Natl Bncp Bank of the Ozarks C1 Finl Inc Seacoast Banking 3Q16 Seacoast 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 22% 0.90x
Slide 22: Investment Thesis: Management and Board
Agenda Investment Thesis Successfully Executing a Differentiated Strategy for Balanced Growth 22 Investor Presentation x Reaping benefits of strategic investments in organic growth and transformation x Track record of completing value - creating acquisitions x Robust risk management and controls hel
Slide 23: Board Comprised of Experts With Distinct Competencies
Seacoast’s Board Is Comprised of Experts With Distinct Competencies In Strategic Areas 23 Investor Presentation 2011 to 2013 • Added lead board director (Retail Banking competency) • Added two additional directors (Risk and Governance competencies) • Added one director (Technology and Consulting com
Slide 24: Investment Thesis: Strong Florida Economy
Agenda Investment Thesis Successfully Executing a Differentiated Model in Community Banking 24 Investor Presentation x Reaping benefits of strategic investments in organic growth and transformation x Track record of completing value - creating acquisitions x Robust risk management and controls help
Slide 25: Florida Continues To Grow Rapidly
Agenda Florida, The Nation’s Third Largest State, Continues To Grow Rapidly Population growth is a fundamental driver of the state economy 25 Investor Presentation • Surpassed New York to become the third largest state in 2014 • One of only three states with a population over 20 million (Texas, Cali
Slide 26: Agenda
Agenda • About Seacoast Bank • Seacoast’s Investment Thesis – Successfully Executing a Differentiated Strategy for Balanced Growth • 2016 Outlook • Company Performance • Appendix Investor Presentation 26
Slide 27: Outlook for 2016: Maintain Pace of Change
Outlook for 2016: Maintain Pace of Change • Continue organic growth investments in digital transformation and customer marketing initiatives • Complete prudent, accretive acquisitions that strengthen our franchise and leverage our capabilities • Adhere to strong standards of credit quality and maint
Slide 28: Agenda
Agenda • About Seacoast Bank • Seacoast’s Investment Thesis – Successfully Executing a Differentiated Strategy for Balanced Growth • 2016 Outlook • Company Performance • Appendix Investor Presentation 28
Slide 29: Q3 2016 Financial and Growth Highlights
29 Financial Highlights Growth Highlights Q3 2016 Financial and Growth Highlights • Revenues, excluding security gains, increased $10.1 million, or 27% year over year to $47.2 million and increased $3.6 million, or 8% (not annualized), from the prior quarter. • Consumer, small business, and mortgage
Slide 30: Earnings History
Earnings History 30 (1) Non - GAAP measure, excludes merger related charges, branch closure expenses, and other adjustments (See Appendix for reconciliati on to GAAP) • Earnings per share increased 71% to $0.24 from $0.14 in the prior quarter. • Adjusted earnings per share rose to $0.28, an increase
Slide 31: Loan Growth Momentum Continues
Loan Growth Momentum Continues 31 $2,099 $2,156 $2,455 $2,616 $2,769 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 $2,400 $2,600 $2,800 $3,000 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Total Loans Outstanding (in millions) Loans grew $ 670 million or 32% from year - ago levels. Adjusting for acquisitions, lo
Slide 32: Deposit Balances Extend Growth Trends
Deposit Balances Extend Growth Trends 32 Total deposits increased 28% to $3.50 billion from one year ago. Transaction accounts represent 55% of total deposits. $1,488 $1,589 $1,805 $1,923 $1,945 $947 $961 $1,055 $1,192 $1,200 $307 $294 $362 $386 $365 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500
Slide 33: Net Interest Income and Margin
Net Interest Income and Margin 33 $29,130 $29,216 $30,349 $34,801 $37,735 3.75% 3.67% 3.68% 3.63% 3.69% 3.00% 3.20% 3.40% 3.60% 3.80% 4.00% 4.20% $0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Net Interest Income and Net Interest Margin* ($ in thousan
Slide 34: Noninterest Income
Noninterest Income 34 $2,217 $2,229 $2,129 $2,230 $2,698 $1,925 $1,989 $2,217 $2,370 $2,306 $1,385 $1,302 $1,437 $1,308 $1,283 $1,177 $955 $999 $1,364 $1,885 $1,012 $911 $1,007 $1,460 $1,210 $396 $377 $379 $382 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000 $10,000 $11,000 Q3-15 Q
Slide 35: Noninterest Expense
Noninterest Expense 35 $13,236 $13,124 $14,526 $15,245 $15,828 $2,279 $2,457 $2,488 $2,698 $3,223 $3,604 $3,678 $3,746 $4,184 $4,418 $6,985 $6,632 $6,546 $6,871 $7,373 $0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Other Occupancy / Telephone Data Pro
Slide 36: Contact Details
Contact Details : Seacoast Banking Corporation of Florida [ NASDAQ: SBCF] 36 Investor Presentation Steve Fowle, CFO (email) Steve.Fowle@SeacoastBank.com (phone) 772.463.8977 Investor Relations www.SeacoastBanking.com
Slide 37: Agenda
Agenda • About Seacoast Bank • Seacoast’s Investment Thesis – Successfully Executing a Differentiated Strategy for Balanced Growth • 2016 Outlook • Company Performance • Appendix Investor Presentation 37
Slide 38: Florida Remains Healthy and Attractive
Agenda Florida Remains Healthy and Attractive 2015 Net Population Migration by State Investor Presentation 38 Source : Federal Reserve Bank of St Louis
Slide 39: Industry Quotes on Digital Banking
“Our analysis suggests that winners may realize a profit upside of 40 percent or more ” “Banks that can match the agility and innovation potential of other industries can reap pre - tax ROE levels of 18% to 25%. ” “ I can imagine us about five, ten years from now talking about efficiency ratios in t
Slide 40: Digital Technology Has Leveled The Playing Field
Digital Technology Has Leveled The Playing Field Digital Defined • Customer Servicing Capabilities to Lower Servicing Costs – E.G. Mobile banking, mobile check deposit, online banking, online applications/forms – Table stakes as “convenience” has been fundamentally redefined – Implication - Customer
Slide 41: Approach To Deepening Customer Relationships Is Unique
Our Approach To Deepening Customer Relationships Is Unique Among Community Banks… Automated Offers Inbound Call Outbound Call In Branch Email ATMs Online Banking Direct Mail Mobile Banking* Our technology enables us to recognize customer needs and communicate consistently across 8 distinct channels.
Slide 42: Using Data To Help Associates Deepen Customer Relationships
…And Seacoast Uses Its Data To Help Our Associates Deepen Customer Relationships Business LOC Usage Campaign – Delivered To Eligible Customers Across Multiple Touchpoints Email ATM Message Online Banking Outbound Sales Call Investor Presentation 42 Software helps us identify customers who have a Bus
Slide 43: Explanation of Certain Unaudited Non-GAAP Financial Measures
Explanation of Certain Unaudited Non - GAAP Financial M easures This presentation contains financial information determined by methods other than Generally Accepted Accounting Principles (“GAAP”) . The financial highlights provide reconciliations between GAAP net income and adjusted net income, GAAP
Slide 44: Net Income - GAAP to Non-GAAP Reconciliation
Net Income - GAAP to Non - GAAP Reconciliation (Q3 15 – Q3 16) To better evaluate its earnings, the Company removes certain items to arrive at adjusted net income, adjusted pretax, pre - provis ion income and adjusted diluted earnings per share (non - GAAP measures) as detailed in the table below (2
Slide 45: Noninterest Expense - GAAP to Non-GAAP Reconciliation
Noninterest Expense - GAAP to Non - GAAP Reconciliation (Q3 15 – Q3 16) Presented below is net income excluding adjustments for merger related charges, branch closure charges, and other non core expenses. The Company believes that these results of operations are a more meaningful depiction of the un
Seacoast Banking Corp of Florida — Q3 2016 Earnings Presentation on 6ix