Triumph Financial, Inc. · NYSE:TFIN
Triumph Financial — Triumph Bancorp — Q3 2019 Earnings Presentation
24 slides from Triumph Financial's earnings presentation, Oct 16, 2019
Slide 1: Q3 2019 Earnings Release
Q3 2019 EARNINGS RELEASE October 16, 2019
Slide 2: Disclaimer: Forward-Looking Statements
DISCLAIMER FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. You can identify fo
Slide 3: Company Overview
COMPANY OVERVIEW Triumph Bancorp, Inc. (NASDAQ: TBK) (“Triumph”) is a financial holding company headquartered in Dallas, Texas. Triumph offers a diversified line of community banking, national lending, and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com
Slide 4: Platform Overview – Branch Network
PLATFORM OVERVIEW – BRANCH NETWORK BRANCH LOCATIONS as of September 30, 2019 61 TOTAL BRANCHES 37 in Colorado 15 in Illinois 3 in Iowa 3 in New Mexico 2 in Kansas 1 in Texas PAPAGE 4 GE 4
Slide 5: Platform Overview – Lending
PLATFORM OVERVIEW – LENDING GEOGRAPHIC LENDING CONCENTRATIONS1 as of September 30, 2019 7% Iowa 14% 23% Illinois Colorado 1% Kansas 4% New Mexico 27% Texas PAG 1 States with a physical branch presence. Excludes factored receivables PAGE 5 E5
Slide 6: Q3 2019 Results and Recent Developments
Q3 2019 RESULTS AND RECENT DEVELOPMENTS Diluted earnings per share of $0.56 for the quarter $14.3 million Total loans held for investment portfolio growth Net income to common stockholders of $373.5 million − Diversified loan growth, including $35.1 million in community banking, $89.0 million LO
Slide 7: Long Term Performance Goals vs Actual Q3
LONG TERM PERFORMANCE GOALS VS ACTUAL Q3 NET INTEREST INCOME CREDIT COSTS TO AVERAGE ASSETS Goal Goal PRE-PROVISION < 0.30% RETURN ON 6.00 - 6.50% NET REVENUE AVERAGE ASSETS Q3 5.31% Q3 0.23% Goal Goal > 3.00% > 2.00% NET OVERHEAD RATIO TAXES Goal Q3 1.67% Goal Q3 1.17% 3.00 - 3.50% ~ 0.57% Q3 3.64%
Slide 8: Loan Portfolio
LOAN PORTFOLIO TOTAL LOANS COMMUNITY BANKING Focused on core deposit generation and business lending in the communities we serve $1,276.1 30% COMMERCIAL FINANCE $2,211.2 53% Factoring, asset based lending, and $4,216.9 equipment finance produce top tier return on assets $729.6 17% NATIONAL LENDING M
Slide 9: Loan Portfolio Detail
LOAN PORTFOLIO DETAIL COMMUNITY BANKING COMMERCIAL FINANCE NATIONAL LENDING 53% of Total Portfolio 30% of Total Portfolio 17% of Total Portfolio 34% 5% $2,211.2 25% 47% 74% $1,276.1 81% $729.6 14% 1% 19% REAL ESTATE Commercial Real Estate $ 1,115.6 Construction, Land & Development $ 164.2 FACTORED R
Slide 10: Triumph Business Capital Factoring
TRIUMPH BUSINESS CAPITAL FACTORING CLIENT PORTFOLIO MIX Yield of 18.23% in the current quarter 83% Average annual charge-off rate of 0.36% over the past 3 years 17% 6,471 factoring clients at September 30, 2019 Transportation Non-Transportation 1,000,000 $2,500 $1,600,000 7,000 Total Purchases
Slide 11: Impact of Spot Rates on Truck Orders
IMPACT OF SPOT RATES ON TRUCK ORDERS Spot rates are highly correlated with new truck orders. The chart below shows three years of history demonstrating the relationship between spot rates and new truck orders. Greater orders of trucks, as we saw in 2018 lead to greater capacity in the market and pre
Slide 12: Triumph's Transportation Finance Opportunity
TRIUMPH’S TRANSPORTATION FINANCE OPPORTUNITY ANNUAL GROSS REVENUES (8% GDP) $750 Billion: 4 Million Trucks FOR-HIRE $400 Billion: 2.6 Million Trucks CONTRACT 3PLs/BROKER $225 Billion $175 Billion Fleet Size Nbr. Carriers Nbr. Trucks Annual Revenue Nbr. 3PLs $ Billions 1 to 5 189,200 300,000 Inactive
Slide 13: Transportation Finance
TRANSPORTATION FINANCE By proudly banking truckers, we intend to be a dominant player in a large industry that is a profitable sector for a well-positioned bank. 40% Products we offer to transportation 35% clients include: 30% Checking 25% Treasury management 20% Factoring Equipment finance
Slide 14: Carrier Payment Platform
CARRIER PAYMENT PLATFORM INVOICE AND PAYMENT TRENDS CLIENTS ON PLATFORM 700 $800 600 $700 Payment Amounts Processed $600 500 Number of Invoices $500 (in thousands) (in millions) 400 $400 300 $300 200 $200 100 $100 - $- 3Q18 4Q18 1Q19 2Q19 3Q19 Total payment amounts processed (annualized) Total invoi
Slide 15: Loan Portfolio: Asset Quality
LOAN PORTFOLIO NCOs / AVERAGE LOANS NPAs / TOTAL ASSETS 2.4% Non-performing Assets 0.21% 2.1% 0.18% Net Chargeoffs 1.8% 0.15% 1.5% 0.12% 1.2% 0.09% 0.9% 0.06% 0.6% 0.03% 0.3% 0.00% 0.0% 3Q18 4Q18 1Q19 2Q19 3Q19 3Q18 4Q18 1Q19 2Q19 3Q19 ACQUIRED LOANS ALLL / TOTAL LOANS $25,000 $1,800 1.00% Discount
Slide 16: Deposit Mix
DEPOSIT MIX Deposit Balances Deposit Mix $4,000 1.6% September 30, 2019 Brokered deposits $3,500 1.4% 9% Certificates of deposit $3,000 1.2% 30% Non‐interest $2,500 1.0% Deposit Balances bearing demand (in millions) 20% Rates $2,000 0.8% $1,500 0.6% $1,000 0.4% Savings 10% $500 0.2% Interest bearing
Slide 17: Financial Highlights
FINANCIAL HIGHLIGHTS As of and For the Thre e Months Ende d Key Metrics Se pte mbe r 30, June 30, March 31, De ce mbe r 31, Se pte mbe r 30, 2019 2019 2019 2018 2018 Pe rformance ratios - annualiz e d Return on average assets 1.17% 1.09% 1.33% 1.60% 0.90% Return on average tangible common equity (RO
Slide 18: Non-GAAP Financial Reconciliation
NON-GAAP FINANCIAL RECONCILIATION Metrics and non-GAAP financial reconciliation As of and for the T hree Months Ended September 30, June 30, March 31, December 31, September 30, (Dollars in thousands, except per share amounts) 2019 2019 2019 2018 2018 Net income available to common stockholders $ 14
Slide 19: Non-GAAP Financial Reconciliation
NON-GAAP FINANCIAL RECONCILIATION Metrics and non-GAAP financial reconciliation (cont'd) As of and for the T hree Months Ended September 30, June 30, March 31, December 31, September 30, (Dollars in thousands, except per share amounts) 2019 2019 2019 2018 2018 Adjusted efficiency ratio: Net interest
Slide 20: Non-GAAP Financial Reconciliation
NON-GAAP FINANCIAL RECONCILIATION Metrics and non-GAAP financial reconciliation (cont'd) As of and for the T hree Months Ended September 30, June 30, March 31, December 31, September 30, (Dollars in thousands, except per share amounts) 2019 2019 2019 2018 2018 T otal stockholders' equity $ 633,693 $
Slide 21: Non-GAAP Financial Reconciliation
NON-GAAP FINANCIAL RECONCILIATION Metrics and non-GAAP financial reconciliation (cont'd) For the T hree Months Ended For the T hree Months Ended September 30, 2019 September 30, 2019 (Dollars in thousands, except per share amounts) GAAP (Dollars in thousands, except per share amounts) GAAP Net inter
Slide 22: Appendix
APPENDIX
Slide 23: Factoring 101
Factoring 101 What is factoring? Client Account Debtor Factoring is one of the oldest forms of finance. Factoring is a financial transaction in which a business sells its accounts receivable to a third party (factor) at a discount. A business typically factors its receivable assets to meet its p
Slide 24: TriumphPay 101
TriumphPay 101 What is TriumphPay? TriumphPay Economics: TriumphPay is a reverse factoring product that connects our proprietary payment 1. Client approves invoice for $2,000. Payment terms are 21 days. processing system with a broker or third party logistics’ (3PL) transportation 2. Carrier opts fo