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CST: 16/09/2019 07:28:05   

Triumph Bancorp Reports First Quarter Net Income to Common Stockholders of $14.8 Million

151 Days ago

DALLAS, April 17, 2019 (GLOBE NEWSWIRE) -- Triumph Bancorp, Inc. (Nasdaq: TBK) (“Triumph”) today announced earnings and operating results for the first quarter of 2019.

As part of how we measure our results, we use certain non-GAAP financial measures to ascertain performance.  These non-GAAP financial measures are reconciled in the section labeled “Metrics and non-GAAP financial reconciliation” at the end of this press release.

2019 First Quarter Highlights and Recent Developments

  • For the first quarter of 2019, net income available to common stockholders was $14.8 million. Diluted earnings per share were $0.55. 
  • Net interest margin (“NIM”) was 6.15% for the quarter ended March 31, 2019. 
  • Total loans held for investment increased $4.2 million, or 0.1%, to $3.613 billion at March 31, 2019. Average loans for the quarter increased $2.6 million, or 0.1%, to $3.535 billion. Loan growth was consistent with historical first quarter results, which is primarily driven by seasonality in our transportation factoring business.
  • Triumph Business Capital grew period-end clients to 6,382 clients, which is an increase of 191 clients, or 3.1%. The total dollar value of invoices purchased for the quarter ended March 31, 2019 was $1.325 billion with an average invoice price of $1,678. 
  • At March 31, 2019, there were 130 clients utilizing the TriumphPay platform, which is an increase of 17 clients, or 15.0%. For the quarter ended March 31, 2019, TriumphPay processed 114,066 invoices paying 22,932 distinct carriers a total of $141.0 million.
  • During the quarter ended March 31, 2019, the Company repurchased 247,312 shares into treasury stock under its stock repurchase program at an average price of $30.51, for a total of $7.6 million.

Balance Sheet

Total loans held for investment were $3.613 billion at March 31, 2019. Our commercial finance loans, which comprise 33% of the loan portfolio, were $1.187 billion at March 31, 2019, compared to $1.256 billion at December 31, 2018, a decrease of $69.3 million, or 5.5% in the first quarter of 2019.

Total deposits were $3.314 billion at March 31, 2019, a decrease of $135.9 million or 3.9% in the first quarter of 2019.  Non-interest-bearing deposits accounted for 20% of total deposits and non-time deposits accounted for 61% of total deposits at March 31, 2019. 

Net Interest Income

We earned net interest income for the quarter ended March 31, 2019 of $61.3 million compared to $64.9 million for the quarter ended December 31, 2018.

Yields on loans for the quarter ended March 31, 2019 were down 15 bps from the prior quarter to 7.99%. The average cost of our total deposits was 0.99% for the quarter ended March 31, 2019 compared to 0.91% for the quarter ended December 31, 2018, on an annualized basis. 

Asset Quality

Non-performing assets remained flat at 0.84% of total assets at March 31, 2019 and December 31, 2018.  The ratio of past due to total loans decreased to 2.33% at March 31, 2019 from 2.41% at December 31, 2018. We recorded total net charge-offs of $1.0 million, or 0.03% of average loans, for the quarter ended March 31, 2019 compared to net charge-offs of $1.6 million, or 0.05% of average loans, for the quarter ended December 31, 2018. 

We recorded a provision for loan losses of $1.0 million for the quarter ended March 31, 2019 compared to a provision of $1.9 million for the quarter ended December 31, 2018. From December 31, 2018 to March 31, 2019, our ALLL remained flat at $27.6 million or 0.76% of total loans. 

Non-Interest Income and Expense

We earned non-interest income for the quarter ended March 31, 2019 of $7.5 million compared to $6.8 million for the quarter ended December 31, 2018.

For the quarter ended March 31, 2019, non-interest expense totaled $48.6 million, compared to $47.0 million for the quarter ended December 31, 2018. 

Conference Call Information

Aaron P. Graft, Vice Chairman and CEO and Bryce Fowler, CFO will review the quarterly results in a conference call for investors and analysts beginning at 7:00 a.m. Central Time on Thursday, April 18, 2019. Dan Karas, Chief Lending Officer, will also be available for questions.

To participate in the live conference call, please dial 1-855-940-9472 (Canada: 1-855-669-9657) and request to be joined into the Triumph Bancorp, Inc. call.  A simultaneous audio-only webcast may be accessed via the Company's website at www.triumphbancorp.com through the Investor Relations, News & Events, Webcasts and Presentations links, or through a direct link here at: https://services.choruscall.com/links/tbk190418.html. An archive of this conference call will subsequently be available at this same location on the Company’s website.  

About Triumph

Triumph Bancorp, Inc. (Nasdaq: TBK) is a financial holding company headquartered in Dallas, Texas.  Triumph offers a diversified line of community banking and commercial finance products through its bank subsidiary, TBK Bank, SSB. www.triumphbancorp.com

Forward-Looking Statements

This press release 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 forward-looking statements by the use of forward-looking terminology such as “believes,” “expects,” “could,” “may,” “will,” “should,” “seeks,” “likely,” “intends,” “plans,” “pro forma,” “projects,” “estimates” or “anticipates” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve numerous risks and uncertainties and you should not rely on them as predictions of future events. Forward-looking statements depend on assumptions, data or methods that may be incorrect or imprecise and we may not be able to realize them. We do not guarantee that the transactions and events described will happen as described (or that they will happen at all). The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: business and economic conditions generally and in the bank and non-bank financial services industries, nationally and within our local market areas; our ability to mitigate our risk exposures; our ability to maintain our historical earnings trends; risks related to the integration of acquired businesses (including our acquisitions of First Bancorp of Durango, Inc., Southern Colorado Corp., and the operating assets of Interstate Capital Corporation and certain of its affiliates) and any future acquisitions; changes in management personnel; interest rate risk; concentration of our factoring services in the transportation industry; credit risk associated with our loan portfolio; lack of seasoning in our loan portfolio; deteriorating asset quality and higher loan charge-offs; time and effort necessary to resolve nonperforming assets; inaccuracy of the assumptions and estimates we make in establishing reserves for probable loan losses and other estimates; lack of liquidity; fluctuations in the fair value and liquidity of the securities we hold for sale; impairment of investment securities, goodwill, other intangible assets, or deferred tax assets; our risk management strategies; environmental liability associated with our lending activities; increased competition in the bank and non-bank financial services industries, nationally, regionally, or locally, which may adversely affect pricing and terms; the accuracy of our financial statements and related disclosures; material weaknesses in our internal control over financial reporting; system failures or failures to prevent breaches of our network security; the institution and outcome of litigation and other legal proceedings against us or to which we become subject; changes in carry-forwards of net operating losses; changes in federal tax law or policy; the impact of recent and future legislative and regulatory changes, including changes in banking, securities, and tax laws and regulations, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and their application by our regulators; governmental monetary and fiscal policies; changes in the scope and cost of the Federal Deposit Insurance Corporation insurance and other coverages; failure to receive regulatory approval for future acquisitions; and increases in our capital requirements.

While forward-looking statements reflect our good-faith beliefs, they are not guarantees of future performance. All forward-looking statements are necessarily only estimates of future results. Accordingly, actual results may differ materially from those expressed in or contemplated by the particular forward-looking statement, and, therefore, you are cautioned not to place undue reliance on such statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" and the forward-looking statement disclosure contained in Triumph’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on February 12, 2019.

Non-GAAP Financial Measures

This press release includes certain non‐GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non‐GAAP financial measures to GAAP financial measures are provided at the end of this press release.

The following table sets forth key metrics used by Triumph to monitor its operations. Footnotes in this table can be found in our definitions of non-GAAP financial measures at the end of this document.

    As of and for the Three Months Ended  
    March 31,     December 31,     September 30,     June 30,     March 31,  
(Dollars in thousands)   2019     2018     2018     2018     2018  
Financial Highlights:                                        
Total assets   $ 4,529,783     $ 4,559,779     $ 4,537,102     $ 3,794,631     $ 3,405,010  
Loans held for investment   $ 3,612,869     $ 3,608,644     $ 3,512,143     $ 3,196,462     $ 2,873,985  
Deposits   $ 3,314,440     $ 3,450,349     $ 3,439,049     $ 2,624,942     $ 2,533,498  
Net income available to common stockholders   $ 14,788     $ 18,085     $ 8,975     $ 12,192     $ 11,878  
                                         
Performance Ratios - Annualized:                                        
Return on average assets     1.33 %     1.60 %     0.90 %     1.37 %     1.43 %
Return on average total equity     9.30 %     11.35 %     5.88 %     8.53 %     12.20 %
Return on average common equity     9.30 %     11.40 %     5.85 %     8.54 %     12.30 %
Return on average tangible common equity (1)     13.43 %     16.73 %     7.57 %     9.95 %     14.75 %
Yield on loans(2)     7.99 %     8.14 %     8.33 %     8.09 %     7.65 %
Cost of interest bearing deposits     1.24 %     1.15 %     1.08 %     0.93 %     0.86 %
Cost of total deposits     0.99 %     0.91 %     0.85 %     0.73 %     0.68 %
Cost of total funds     1.28 %     1.14 %     1.16 %     1.06 %     0.95 %
Net interest margin(2)     6.15 %     6.34 %     6.59 %     6.36 %     6.06 %
Net non-interest expense to average assets     3.70 %     3.55 %     4.19 %     3.59 %     3.43 %
Adjusted net non-interest expense to average assets (1)     3.70 %     3.55 %     3.62 %     3.47 %     3.56 %
Efficiency ratio     70.54 %     65.52 %     72.15 %     64.26 %     65.09 %
Adjusted efficiency ratio (1)     70.54 %     65.52 %     63.49 %     62.38 %     66.45 %
                                         
Asset Quality:(3)                                        
Past due to total loans     2.33 %     2.41 %     2.23 %     2.54 %     2.41 %
Non-performing loans to total loans     0.95 %     1.00 %     1.13 %     1.43 %     1.41 %
Non-performing assets to total assets     0.84 %     0.84 %     0.93 %     1.28 %     1.47 %
ALLL to non-performing loans     80.70 %     76.47 %     68.82 %     53.57 %     49.52 %
ALLL to total loans     0.76 %     0.76 %     0.78 %     0.77 %     0.70 %
Net charge-offs to average loans     0.03 %     0.05 %     0.12 %     0.01 %     0.05 %
                                         
Capital:                                        
Tier 1 capital to average assets(4)     11.32 %     11.08 %     11.75 %     15.00 %     11.23 %
Tier 1 capital to risk-weighted assets(4)     11.76 %     11.49 %     11.16 %     14.68 %     11.54 %
Common equity tier 1 capital to risk-weighted assets(4)     10.81 %     10.55 %     9.96 %     13.32 %     10.05 %
Total capital to risk-weighted assets(4)     13.62 %     13.35 %     13.05 %     16.73 %     13.66 %
Total equity to total assets     14.27 %     13.96 %     13.59 %     16.00 %     11.83 %
Tangible common stockholders' equity to tangible assets(1)     10.37 %     10.03 %     9.35 %     13.05 %     9.86 %
                                         
Per Share Amounts:                                        
Book value per share   $ 24.19     $ 23.62     $ 23.10     $ 22.76     $ 18.89  
Tangible book value per share (1)   $ 16.82     $ 16.22     $ 15.42     $ 18.27     $ 15.82  
Basic earnings per common share   $ 0.55     $ 0.68     $ 0.34     $ 0.48     $ 0.57  
Diluted earnings per common share   $ 0.55     $ 0.67     $ 0.34     $ 0.47     $ 0.56  
Adjusted diluted earnings per common share(1)   $ 0.55     $ 0.67     $ 0.51     $ 0.50     $ 0.52  
Shares outstanding end of period     26,709,411       26,949,936       26,279,761       26,260,785       20,824,509  

Unaudited consolidated balance sheet as of:

    March 31,     December 31,     September 30,     June 30,     March 31,  
 (Dollars in thousands)   2019     2018     2018     2018     2018  
ASSETS                                        
Total cash and cash equivalents   $ 171,950     $ 234,939     $ 282,409     $ 133,365     $ 106,046  
Securities - available for sale     339,465       336,423       355,981       183,184       192,916  
Securities - held to maturity     8,499       8,487       8,403       8,673       8,614  
Equity securities     5,183       5,044       4,981       5,025       4,925  
Loans held for sale     610       2,106       683              
Loans held for investment     3,612,869       3,608,644       3,512,143       3,196,462       2,873,985  
Allowance for loan and lease losses     (27,605 )     (27,571 )     (27,256 )     (24,547 )     (20,022 )
Loans, net     3,585,264       3,581,073       3,484,887       3,171,915       2,853,963  
FHLB stock     21,191       15,943       23,109       19,223       16,508  
Premises and equipment, net     84,931       83,392       82,935       68,313       62,826  
Other real estate owned ("OREO"), net     3,073       2,060       2,442       2,528       9,186  
Goodwill and intangible assets, net     197,015       199,417       201,842       117,777       63,923  
Bank-owned life insurance     40,667       40,509       40,339       40,168       44,534  
Deferred tax asset, net     7,608       8,438       8,137       8,810       8,849  
Other assets     64,327       41,948       40,954       35,650       32,720  
Total assets   $ 4,529,783     $ 4,559,779     $ 4,537,102     $ 3,794,631     $ 3,405,010  
LIABILITIES                                        
Non-interest bearing deposits   $ 667,597     $ 724,527     $ 697,903     $ 561,033     $ 548,991  
Interest bearing deposits     2,646,843       2,725,822       2,741,146       2,063,909       1,984,507  
Total deposits     3,314,440       3,450,349       3,439,049       2,624,942       2,533,498  
Customer repurchase agreements     3,727       4,485       13,248       10,509       6,751  
Federal Home Loan Bank advances     405,000       330,000       330,000       420,000       355,000  
Subordinated notes     48,956       48,929       48,903       48,878       48,853  
Junior subordinated debentures     39,200       39,083       38,966       38,849       38,734  
Other liabilities     72,244       50,326       50,295       44,228       19,230  
Total liabilities     3,883,567       3,923,172       3,920,461       3,187,406       3,002,066  
EQUITY                                        
Preferred stock series A                 4,550       4,550       4,550  
Preferred stock series B                 5,108       5,108       5,108  
Common stock     271       271       264       264       209  
Additional paid-in-capital     470,292       469,341       458,920       457,980       265,406  
Treasury stock, at cost     (9,881 )     (2,288 )     (2,285 )     (2,254 )     (1,853 )
Retained earnings     185,274       170,486       152,401       143,426       131,234  
Accumulated other comprehensive income     260       (1,203 )     (2,317 )     (1,849 )     (1,710 )
Total equity     646,216       636,607       616,641       607,225       402,944  
Total liabilities and equity   $ 4,529,783     $ 4,559,779     $ 4,537,102     $ 3,794,631     $ 3,405,010  


Unaudited consolidated statement of income:

    For the Three Months Ended  
    March 31,     December 31,     September 30,     June 30,     March 31,  
 (Dollars in thousands)   2019     2018     2018     2018     2018  
Interest income:                                        
Loans, including fees   $ 45,094     $ 44,435     $ 41,257     $ 38,148     $ 36,883  
Factored receivables, including fees     24,556       28,070       27,939       20,791       15,303  
Securities     2,644       2,314       1,551       1,179       1,310  
FHLB stock     192       154       147       101       105  
Cash deposits     778       877       865       1,030       517  
Total interest income     73,264       75,850       71,759       61,249       54,118  
Interest expense:                                        
Deposits     8,218       7,931       6,219       4,631       4,277  
Subordinated notes     839       839       837       838       837  
Junior subordinated debentures     760       717       714       713       597  
Other borrowings     2,136       1,482       2,207       1,810       1,277  
Total interest expense     11,953       10,969       9,977       7,992       6,988  
Net interest income     61,311       64,881       61,782       53,257       47,130  
Provision for loan losses     1,014       1,910       6,803       4,906       2,548  
Net interest income after provision for loan losses     60,297       62,971       54,979       48,351       44,582  
Non-interest income:                                        
Service charges on deposits     1,606       1,702       1,412       1,210       1,145  
Card income     1,844       1,999       1,877       1,394       1,244  
Net OREO gains (losses) and valuation adjustments     209       37       65       (528 )     (88 )
Net gains (losses) on sale of securities     (11 )                       (272 )
Fee income     1,612       1,636       1,593       1,121       800  
Insurance commissions     919       846       1,113       819       714  
Gain on sale of subsidiary                             1,071  
Other     1,359       574       (1 )     929       558  
Total non-interest income     7,538       6,794       6,059       4,945       5,172  
Non-interest expense:                                        
Salaries and employee benefits     26,439       25,586       24,695       20,527       19,404  
Occupancy, furniture and equipment     4,522       4,402       3,553       3,014       3,054  
FDIC insurance and other regulatory assessments     299       184       363       383       199  
Professional fees     1,865       1,837       3,384       2,078       1,640  
Amortization of intangible assets     2,402       2,438       2,064       1,361       1,117  
Advertising and promotion     1,604       1,036       1,609       1,300       1,029  
Communications and technology     4,874       4,388       7,252       3,271       3,359  
Other     6,561       7,091       6,026       5,469       4,240  
Total non-interest expense     48,566       46,962       48,946       37,403       34,042  
Net income before income tax     19,269       22,803       12,092       15,893       15,712  
Income tax expense     4,481       4,718       2,922       3,508       3,644  
Net income   $ 14,788     $ 18,085     $ 9,170     $ 12,385     $ 12,068  
Dividends on preferred stock                 (195 )     (193 )     (190 )
Net income available to common stockholders   $ 14,788     $ 18,085     $ 8,975     $ 12,192     $ 11,878  


Earnings per share:

    For the Three Months Ended  
    March 31,     December 31,     September 30,     June 30,     March 31,  
(Dollars in thousands)   2019     2018     2018     2018     2018  
Basic                                        
Net income to common stockholders   $ 14,788     $ 18,085     $ 8,975     $ 12,192     $ 11,878  
Weighted average common shares outstanding     26,679,724       26,666,554       26,178,194       25,519,108       20,721,363  
Basic earnings per common share   $ 0.55     $ 0.68     $ 0.34     $ 0.48     $ 0.57  
                                         
Diluted                                        
Net income to common stockholders   $ 14,788     $ 18,085     $ 8,975     $ 12,192     $ 11,878  
Dilutive effect of preferred stock                 195       193       190  
Net income to common stockholders - diluted   $ 14,788     $ 18,085     $ 9,170     $ 12,385     $ 12,068  
Weighted average common shares outstanding     26,679,724       26,666,554       26,178,194       25,519,108       20,721,363  
Dilutive effects of:                                        
Assumed conversion of Preferred A           89,240       315,773       315,773       315,773  
Assumed conversion of Preferred B           100,176       354,471       354,471       354,471  
Assumed exercises of stock options     64,166       76,219       90,320       86,821       83,872  
Restricted stock awards     49,795       46,457       45,796       37,417       85,045  
Restricted stock units           1,303       7,276       2,288        
Performance stock units                              
Weighted average shares outstanding - diluted     26,793,685       26,979,949       26,991,830       26,315,878       21,560,524  
Diluted earnings per common share   $ 0.55     $ 0.67     $ 0.34     $ 0.47     $ 0.56  
                                         
                                         
Shares that were not considered in computing diluted earnings per common share because they were antidilutive are as follows:  
                                         
    For the Three Months Ended  
    March 31,     December 31,     September 30,     June 30,     March 31,  
    2019     2018     2018     2018     2018  
Assumed conversion of Preferred A                              
Assumed conversion of Preferred B                              
Stock options     50,752       51,952       51,952       51,952        
Restricted stock awards     13,290       14,513       14,513              
Restricted stock units     58,400                          
Performance stock units     58,400       59,658       59,658       59,658        


Loans held for investment summarized as of:

    March 31,     December 31,     September 30,     June 30,     March 31,  
 (Dollars in thousands)   2019     2018     2018     2018     2018  
Commercial real estate   $ 1,093,882     $ 992,080     $ 906,494     $ 766,839     $ 781,006  
Construction, land development, land     145,002       179,591       190,920       147,852       143,876  
1-4 family residential properties     194,067       190,185       194,752       122,653       122,979  
Farmland     156,299       170,540       177,313       177,060       184,064  
Commercial     1,117,640       1,114,971       1,123,598       1,006,443       930,283  
Factored receivables     570,663       617,791       611,285       603,812       397,145  
Consumer     27,941       29,822       31,423       28,775       29,244  
Mortgage warehouse     307,375       313,664       276,358       343,028       285,388  
  Total loans   $ 3,612,869     $ 3,608,644     $ 3,512,143     $ 3,196,462     $ 2,873,985  

A portion of our total loans held for investment portfolio consists of traditional community bank loans as well as commercial finance products offered under our commercial finance brands on a nationwide basis. Commercial finance loans are further summarized below:

    March 31,     December 31,     September 30,     June 30,     March 31,  
(Dollars in thousands)   2019     2018     2018     2018     2018  
Equipment   $ 364,447     $ 352,037     $ 323,832     $ 290,314     $ 260,502  
Asset based lending (General)     174,447       214,110       273,096       261,412       230,314  
Premium finance     77,389       72,302       75,293       51,416       48,561  
Factored receivables     570,663       617,791       611,285       603,812       397,145  
  Commercial finance   $ 1,186,946     $ 1,256,240     $ 1,283,506     $ 1,206,954     $ 936,522  
                                         
Commercial finance % of total loans     33 %     35 %     37 %     38 %     33 %

Additional information pertaining to our loan portfolio, summarized as of and for the quarters ended:

    March 31,     December 31,     September 30,     June 30,     March 31,  
(Dollars in thousands)   2019     2018     2018     2018     2018  
Average community banking   $ 2,340,295     $ 2,268,262     $ 2,039,624     $ 1,897,678     $ 1,816,921  
Average commercial finance(1)     1,194,748       1,264,209       1,254,095       1,024,369       949,938  
Average total loans   $ 3,535,043     $ 3,532,471     $ 3,293,719     $ 2,922,047     $ 2,766,859  
Community banking yield     5.87 %     5.78 %     5.68 %     5.80 %     5.81 %
Commercial finance yield(1)     12.15 %     12.39 %     12.66 %     12.08 %     11.17 %
Total loan yield     7.99 %     8.14 %     8.33 %     8.09 %     7.65 %

(1) Includes assets held for sale for the period ended March 31, 2018

Information pertaining to our factoring segment, which includes only factoring originated by our Triumph Business Capital subsidiary, summarized as of and for the quarters ended:

     March 31,     December 31,     September 30,     June 30,     March 31,  
    2019     2018     2018     2018     2018  
Factored receivable period end balance   $ 534,420,000     $ 588,750,000     $ 579,985,000     $ 577,548,000     $ 372,771,000  
Yield on average receivable balance     17.96 %     18.24 %     18.96 %     18.70 %     17.40 %
Rolling twelve quarter annual charge-off rate     0.39 %     0.37 %     0.38 %     0.41 %     0.50 %
Factored receivables - transportation concentration     81 %     83 %     83 %     84 %     86 %
                                         
Interest income, including fees   $ 23,803,000     $ 27,578,000     $ 27,420,000     $ 20,314,000     $ 14,780,000  
Non-interest income     1,077,000       1,032,000       942,000       920,000       590,000  
Factored receivable total revenue     24,880,000       28,610,000       28,362,000       21,234,000       15,370,000  
Average net funds employed     490,241,000       547,996,000       525,499,000       398,096,000       316,488,000  
Yield on average net funds employed     20.58 %     20.71 %     21.41 %     21.39 %     19.70 %
                                         
Accounts receivable purchased   $ 1,325,140,000     $ 1,541,332,000     $ 1,503,049,000     $ 1,162,810,000     $ 912,336,000  
Number of invoices purchased     789,838       882,042       836,771       656,429       521,906  
Average invoice size   $ 1,678     $ 1,747     $ 1,796     $ 1,771     $ 1,751  
Average invoice size - transportation   $ 1,541     $ 1,625     $ 1,666     $ 1,695     $ 1,662  
Average invoice size - non-transportation   $ 3,276     $ 3,209     $ 3,267     $ 2,522     $ 2,627  
                                         
Net new clients     191       259       422       2,072       280  
Period end clients     6,382       6,191       5,932       5,510       3,438  

Deposits summarized as of:

    March 31,     December 31,     September 30,     June 30,     March 31,    
(Dollars in thousands)   2019     2018     2018     2018     2018    
Non-interest bearing demand   $ 667,597     $ 724,527     $ 697,903     $ 561,033     $ 548,991    
Interest bearing demand     602,088       615,704       608,775       358,246       392,947    
Individual retirement accounts     112,696       115,583       118,459       101,380       105,558    
Money market     372,109       443,663       413,402       268,699       283,354    
Savings     372,914       369,389       373,062       239,127       244,103    
Certificates of deposit     851,411       835,127       854,048       751,290       783,651    
Brokered deposits     335,625       346,356       373,400       345,167       174,894    
  Total deposits   $ 3,314,440     $ 3,450,349     $ 3,439,049     $ 2,624,942     $ 2,533,498    

Net interest margin summarized for the three months ended:

     March 31, 2019     December 31, 2018  
    Average             Average     Average             Average  
(Dollars in thousands)   Balance     Interest     Rate     Balance     Interest     Rate  
Interest earning assets:                                                
Interest earning cash balances   $ 126,372     $ 778       2.50 %   $ 152,212     $ 877       2.29 %
Taxable securities     275,642       2,169       3.19 %     235,234       1,674       2.82 %
Tax-exempt securities     88,667       475       2.17 %     123,575       640       2.05 %
FHLB stock     17,860       192       4.36 %     16,426       154       3.72 %
Loans     3,535,043       69,650       7.99 %     3,532,471       72,505       8.14 %
  Total interest earning assets   $ 4,043,584     $ 73,264       7.35 %   $ 4,059,918     $ 75,850       7.41 %
Non-interest earning assets:                                                
Other assets     458,176                       429,000                  
  Total assets   $ 4,501,760                     $ 4,488,918                  
Interest bearing liabilities:                                                
Deposits:                                                
Interest bearing demand   $ 606,096     $ 374       0.25 %   $ 613,872     $ 417       0.27 %
Individual retirement accounts     113,636       405       1.45 %     116,575       385       1.31 %
Money market     408,953       1,331       1.32 %     430,864       1,312       1.21 %
Savings     370,067       123       0.13 %     373,650       159       0.17 %
Certificates of deposit     834,515       3,965       1.93 %     862,500       3,749       1.72 %
  Brokered deposits     353,829       2,020       2.32 %     347,498       1,909       2.18 %
  Total deposits     2,687,096       8,218       1.24 %     2,744,959       7,931       1.15 %
Subordinated notes     48,940       839       6.95 %     48,914       839       6.81 %
Junior subordinated debentures     39,125       760       7.88 %     39,011       717       7.29 %
Other borrowings     336,667       2,136       2.57 %     262,391       1,482       2.24 %
  Total interest bearing liabilities   $ 3,111,828     $ 11,953       1.56 %   $ 3,095,275     $ 10,969       1.41 %
Non-interest bearing liabilities and equity:                                                
Non-interest bearing demand deposits     679,538                       714,884                  
Other liabilities     65,434                       46,633                  
Total equity     644,960                       632,126                  
Total liabilities and equity   $ 4,501,760                     $ 4,488,918                  
Net interest income           $ 61,311                     $ 64,881          
Interest spread                     5.79 %                     6.00 %
Net interest margin                     6.15 %                     6.34 %


Metrics and non-GAAP financial reconciliation:

    As of and for the Three Months Ended  
 (Dollars in thousands,   March 31,     December 31,     September 30,     June 30,     March 31,  
 except per share amounts)   2019     2018     2018     2018     2018  
Net income available to common stockholders   $ 14,788     $ 18,085     $ 8,975     $ 12,192     $ 11,878  
Gain on sale of subsidiary                             (1,071 )
Transaction related costs                 5,871       1,094        
Tax effect of adjustments                 (1,392 )     (257 )     248  
Adjusted net income available to common stockholders   $ 14,788     $ 18,085     $ 13,454     $ 13,029     $ 11,055  
Dilutive effect of convertible preferred stock                 195       193       190  
Adjusted net income available to common stockholders - diluted   $ 14,788     $ 18,085     $ 13,649     $ 13,222     $ 11,245  
                                         
Weighted average shares outstanding - diluted     26,793,685       26,979,949       26,991,830       26,315,878       21,560,524  
Adjusted effects of assumed Preferred Stock conversion                              
Adjusted weighted average shares outstanding - diluted     26,793,685       26,979,949       26,991,830       26,315,878       21,560,524  
Adjusted diluted earnings per common share   $ 0.55     $ 0.67     $ 0.51     $ 0.50     $ 0.52  
                                         
Net income available to common stockholders   $ 14,788     $ 18,085     $ 8,975     $ 12,192     $ 11,878  
Average tangible common equity     446,571       428,748       470,553       491,492       326,614  
Return on average tangible common equity     13.43 %     16.73 %     7.57 %     9.95 %     14.75 %
                                         
Adjusted efficiency ratio:                                        
Net interest income   $ 61,311     $ 64,881     $ 61,782     $ 53,257     $ 47,130  
Non-interest income     7,538       6,794       6,059       4,945       5,172  
Operating revenue     68,849       71,675       67,841       58,202       52,302  
Gain on sale of subsidiary                             (1,071 )
Adjusted operating revenue   $ 68,849     $ 71,675     $ 67,841     $ 58,202     $ 51,231  
Non-interest expenses   $ 48,566     $ 46,962     $ 48,946     $ 37,403     $ 34,042  
Transaction related costs                 (5,871 )     (1,094 )      
Adjusted non-interest expenses   $ 48,566     $ 46,962     $ 43,075     $ 36,309     $ 34,042  
Adjusted efficiency ratio     70.54 %     65.52 %     63.49 %     62.38 %     66.45 %
                                         
Adjusted net non-interest expense to average assets ratio:                                        
Non-interest expenses   $ 48,566     $ 46,962     $ 48,946     $ 37,403     $ 34,042  
Transaction related costs                 (5,871 )     (1,094 )      
Adjusted non-interest expenses   $ 48,566     $ 46,962     $ 43,075     $ 36,309     $ 34,042  
                                         
Total non-interest income   $ 7,538     $ 6,794     $ 6,059     $ 4,945     $ 5,172  
Gain on sale of subsidiary                             (1,071 )
Adjusted non-interest income   $ 7,538     $ 6,794     $ 6,059     $ 4,945     $ 4,101  
Adjusted net non-interest expenses   $ 41,028     $ 40,168     $ 37,016     $ 31,364     $ 29,941  
Average total assets   $ 4,501,760     $ 4,488,918     $ 4,060,560     $ 3,628,960     $ 3,410,883  
Adjusted net non-interest expense to average assets ratio     3.70 %     3.55 %     3.62 %     3.47 %     3.56 %
                                         
Total stockholders' equity   $ 646,216     $ 636,607     $ 616,641     $ 607,225     $ 402,944  
Preferred stock liquidation preference                 (9,658 )     (9,658 )     (9,658 )
Total common stockholders' equity     646,216       636,607       606,983       597,567       393,286  
Goodwill and other intangibles     (197,015 )     (199,417 )     (201,842 )     (117,777 )     (63,923 )
Tangible common stockholders' equity   $ 449,201     $ 437,190     $ 405,141     $ 479,790     $ 329,363  
Common shares outstanding     26,709,411       26,949,936       26,279,761       26,260,785       20,824,509  
Tangible book value per share   $ 16.82     $ 16.22     $ 15.42     $ 18.27     $ 15.82  
                                         
Total assets at end of period   $ 4,529,783     $ 4,559,779     $ 4,537,102     $ 3,794,631     $ 3,405,010  
Goodwill and other intangibles     (197,015 )     (199,417 )     (201,842 )     (117,777 )     (63,923 )
Adjusted total assets at period end   $ 4,332,768     $ 4,360,362     $ 4,335,260     $ 3,676,854     $ 3,341,087  
Tangible common stockholders' equity ratio     10.37 %     10.03 %     9.35 %     13.05 %     9.86 %

1)       Triumph uses certain non-GAAP financial measures to provide meaningful supplemental information regarding Triumph's operational performance and to enhance investors' overall understanding of such financial performance.  The non-GAAP measures used by Triumph include the following:

  • “Adjusted diluted earnings per common share” is defined as adjusted net income available to common stockholders divided by adjusted weighted average diluted common shares outstanding.  Excluded from net income available to common stockholders are material gains and expenses related to merger and acquisition-related activities, including divestitures, net of tax. In our judgment, the adjustments made to net income available to common stockholders allow management and investors to better assess our performance in relation to our core net income by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.  Weighted average diluted common shares outstanding are adjusted as a result of changes in their dilutive properties given the gain and expense adjustments described herein.  
  • "Tangible common stockholders' equity" is common stockholders' equity less goodwill and other intangible assets.
  • "Total tangible assets" is defined as total assets less goodwill and other intangible assets.
  • "Tangible book value per share" is defined as tangible common stockholders' equity divided by total common shares outstanding. This measure is important to investors interested in changes from period-to-period in book value per share exclusive of changes in intangible assets.
  • "Tangible common stockholders' equity ratio" is defined as the ratio of tangible common stockholders' equity divided by total tangible assets. We believe that this measure is important to many investors in the marketplace who are interested in relative changes from period-to period in common equity and total assets, each exclusive of changes in intangible assets.
  • "Return on Average Tangible Common Equity" is defined as net income available to common stockholders divided by average tangible common stockholders' equity.
  • "Adjusted efficiency ratio" is defined as non-interest expenses divided by our operating revenue, which is equal to net interest income plus non-interest income. Also excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures. In our judgment, the adjustments made to operating revenue and non-interest expense allow management and investors to better assess our performance in relation to our core operating revenue by removing the volatility associated with certain acquisition-related items and other discrete items that are unrelated to our core business.
  • "Adjusted net non-interest expense to average total assets" is defined as non-interest expenses net of non-interest income divided by total average assets. Excluded are material gains and expenses related to merger and acquisition-related activities, including divestitures.  This metric is used by our management to better assess our operating efficiency. 

2)       Performance ratios include discount accretion on purchased loans for the periods presented as follows:

    For the Three Months Ended  
    March 31,     December 31,     September 30,     June 30,     March 31,  
(Dollars in thousands)   2019     2018     2018     2018     2018  
Loan discount accretion   $ 1,557     $ 1,411     $ 1,271     $ 3,637     $ 1,977  

3)       Asset quality ratios exclude loans held for sale, except for non-performing assets to total assets.

4)       Current quarter ratios are preliminary.


Source: Triumph Bancorp, Inc.

Investor Relations:
Luke Wyse
Senior Vice President, Finance & Investor Relations
lwyse@tbkbank.com
214-365-6936

Media Contact:
Amanda Tavackoli
Senior Vice President, Marketing & Communication
atavackoli@tbkbank.com
214-365-6930

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