Civista Bancshares, Inc. (NASDAQ:CIVB) Q3 2018 Earnings Conference Call Transcript

Nov 02, 2018 • 01:00 pm ET

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Civista Bancshares, Inc. (NASDAQ:CIVB) Q3 2018 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good afternoon, and welcome to the Civista Bancshares, Inc. Third Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. (Operator Instructions) Please note, this event is being recorded.

I'd now like to turn the conference over to Dennis Shaffer, President and CEO. Mr. Shaffer, please go ahead.

Executive
Dennis G. Shaffer

This is Dennis Shaffer, President and CEO of Civista Bancshares. I would like to thank you for joining us for our third quarter 2018 earnings call.

I'm joined today by Rich Dutton, SVP of the company, and Chief Operating Officer of the bank; and Chuck Parcher, SVP of the company and Chief Lending Officer of the bank and other members of our executive team.

(Forward-Looking Cautionary Statements)

Additionally, management may refer to non-GAAP measures, which are intended to supplement, but not substitute, the most directly comparable GAAP measures. A press release available on the website contains the financial and other quantitative information to be discussed today as well as the reconciliation of the GAAP to non-GAAP measures.

We will record this call and make it available on Civista Bancshares' website at civb.com. Again, welcome to Civista Bancshares' third quarter 2018 earnings call. I would like to begin by discussing our results, which were issued this morning. At the conclusion of my remarks, we will take any questions that you may have.

Probably the most significant item that happened during the third quarter was the closing of the acquisition of United Community Bancorp or as we refer to them as UCB. We closed the acquisition on September 14. We also converted and integrated all systems during that weekend. While there were -- there are still more integration tasks to occur, the last portions -- the largest portions are complete. While the completion of the acquisition is a significant accomplishment and many of our third quarter numbers are affected by it, we were able to generate very strong core earnings.

During the quarter, we incurred several costs related to closing the acquisition. As such, our discussion today will refer to both the actual GAAP results as well as our core results. We recognized only 2 weeks of benefit from our expanded operations, so while our balance sheet reflects the addition of UCB, the additional income we expect to come from the acquisition is not yet fully reflected in our numbers.

This morning, we reported a net loss for our third quarter of $3.6 million or $0.31 per diluted share. This includes $8.8 million in nonrecurring acquisition and integration expenses as well as a $392,000 loss on the sale of securities, which was part of a portfolio repositioning transaction we executed during the third quarter.

Our core adjusted earnings were $4.8 million or $0.37 per diluted share for the quarter. For the 9 months ending September 30, 2018, we had net income of $5.8 million or $0.51 per diluted share, which also included year-to-date nonrecurring acquisition and integration expenses of $12 million. Our core adjusted earnings were $16.8 million or $1.37 per diluted share