19 slides from Enterprise Financial Services's earnings presentation, Jul 23, 2015
Slide 1: 2015 Second Quarter Earnings Release
Enterprise Financial Services Corp 2015 SECOND QUARTER EARNINGS RELEASE
Slide 2: Forward-Looking Statements
1 Some of the information in this report contains “forward-looking statements” within the meaning of and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements typically are identified with use of terms such as “ma
Slide 3: 2015 Objectives
2 GROW CORE EPS DRIVE QUALITY LOAN GROWTH ENHANCE CORE NET INTEREST INCOME DEFEND CORE NET INTEREST MARGIN MAINTAIN HIGH CREDIT QUALITY METRICS IMPROVE OPERATING LEVERAGE 2015 OBJECTIVES
Slide 4: Portfolio Loan Trends
3 PORTFOLIO LOAN TRENDS $2,251 $2,295 $2,434 $2,436 $2,543 6/30/2014 9/30/2014 12/31/2014 3/31/2015 6/30/2015 In Millions
Slide 5: Commercial & Industrial Loan Trends
4 $1,135 $1,172 $1,270 $1,265 $1,335 6/30/2014 9/30/2014 12/31/2014 3/31/2015 6/30/2015 COMMERCIAL & INDUSTRIAL LOAN TRENDS In Millions
Slide 6: Portfolio Loan Trends
5 PORTFOLIO LOAN TRENDS 6/30/15 3/31/15 CHANGE ENTERPRISE VALUE LENDING $ 251 $ 204 $ 47 C&I GENERAL 712 696 16 LIFE INSURANCE PREMIUM FINANCING 239 230 9 TAX CREDIT 133 136 (3) COMMERCIAL/CRE 940 920 20 RESIDENTIAL 186 180 6 OTHER 82 70 12 PORTFOLIO LOANS $ 2,543 $ 2,436 $ 107 In Millions
Slide 7: Portfolio Loans by Region
6 PORTFOLIO LOANS BY REGION $1,760 $633 $150 St. Louis Kansas City Arizona 06/30/2015 $1,723 $574 $139 St. Louis Kansas City Arizona 3/31/2015 In Millions In Millions
Slide 8: Deposit Trends
7 DEPOSIT TRENDS $2,465 $2,510 $2,492 $2,675 $2,692 27.4% 27.7% 25.8% 25.5% 24.5% -30.0% -5.0% 20.0% Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Deposits DDA %
Slide 9: Earnings Per Share: Reported vs. Core EPS
8 EARNINGS PER SHARE $22,387 $0.43 <$0.05> $0.38 EPS Non-Core Covered Assets Core EPS In Millions * A Non GAAP Measure, Refer to Appendix for Reconciliation (1) FDIC Loss Sharing Agreements REPORTED VS. CORE EPS* Q2 2015 (1)
Slide 10: Earnings Per Share Trend
9 EARNINGS PER SHARE TREND $0.35 $0.02 < $0.02> $0.03 $0.38 Q1 '15 Net Interest Income Portfolio Loan Loss Provision Non Interest Income Q2 '15 In Millions CHANGES IN CORE EPS* Note: * A Non GAAP Measure, Refer to Appendix for Reconciliation
Slide 11: Net Interest Income Driving Core Revenue Growth
10 NET INTEREST INCOME DRIVING CORE REVENUE GROWTH* In Millions Note: * A Non-GAAP Measure, Refer to Appendix for Reconciliation $24.2 $24.9 $25.7 $25.6 $26.3 3.41% 3.41% 3.45% 3.46% 3.46% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% $18.0 $19.0 $20.0 $21.0 $22.0 $23.0 $24.0 $25.0 $26.0 $27.0 Q2
Slide 12: Credit Trends for Portfolio Loans
11 CREDIT TRENDS FOR PORTFOLIO LOANS 15 bps -5 bps 10 bps 25 bps 11 bps Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 0 Net Charge-offs (1) 2014 NCO = 7 bps (1) Portfolio loans only, excludes PCI loans $77.1 $43.8 $139.0 $1.6 $107.0 0 50 100 150 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Portfolio Loan Growth $1.3 $0.
Slide 13: Core Non-Interest Income
12 CORE NON-INTEREST INCOME* WM REVENUE WM REVENUE DEPOSIT SERVICE CHARGES DEPOSIT SERVICE CHARGES GAIN ON SALE OF ORE STATE TAX CREDITS STATE TAX CREDITS OTHER INCOME OTHER INCOME Q1 2015 Q2 2015 $5,839 $6,741 RECONCILIATION OF OTHER NON-INTEREST INCOME Q1 2015 $1,534 ALLOCATION FEE FROM TAX CREDIT
Slide 14: Managed Operating Expenses: Improving Efficiency
13 MANAGED OPERATING EXPENSES* IMPROVING EFFICIENCY In Millions Note: * A Non-GAAP Measure, Refer to Appendix for Reconciliation $19.5 $19.3 $20.2 $19.1 $19.0 64.5% 62.8% 62.8% 60.7% 57.6% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% -20 -5 10 25 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Operating Expens
Slide 15: Positive Momentum in Core Earnings Per Share
14 POSITIVE MOMENTUM IN CORE* EARNINGS PER SHARE $0.31 $0.37 $0.33 $0.35 $0.38 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Note: * A Non-GAAP Measure, Refer to Appendix for Reconciliation 23% Core EPS Growth from Q2 2014 to Q2 2015
Slide 16: Financial Priorities
15 CONTINUED GROWTH IN CORE EPS DRIVE NET INTEREST INCOME GROWTH IN DOLLARS WITH FAVORABLE LOAN GROWTH TRENDS DEFEND NET INTEREST MARGIN MAINTAIN HIGH QUALITY CREDIT PROFILE ACHIEVE FURTHER IMPROVEMENT IN OPERATING LEVERAGE ENHANCE DEPOSIT LEVELS TO SUPPORT GROWTH FINANCIAL PRIORITIES Q2 2015
Slide 17: Appendix
Appendix
Slide 18: Use of Non-GAAP Financial Measures
17 USE OF NON-GAAP FINANCIAL MEASURES The Company's accounting and reporting policies conform to generally accepted accounting principles in the United States (“GAAP”) and the prevailing practices in the banking industry. However, the Company provides other financial measures, such as Core net incom
Slide 19: Reconciliation of Non-GAAP Financial Measures
18 RECONCILIATION OF NON-GAAP FINANCIAL MEASURES Jun 30, Mar 31, Dec 31, Sep 30, Jun 30, Jun 30, Jun 30, (in thousands) 2015 2015 2014 2014 2014 2015 2014 CORE PERFORMANCE MEASURES Net interest income 29,280$ 29,045$ 30,816$ 27,444$ 28,742$ 58,325$ 59,108$ Less: Incremental accretion income 3,003 3,