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Public Companies May/June 2011

Feds approve Hancock-Whitney deal

The Federal Reserve has approved the long-awaited merger of Whitney Bank with Mississippi-based Hancock Bank, bringing the official acquisition date of June 5 closer to fruition.

Hancock announced in December that it was acquiring Whitney, Louisiana’s largest bank, in a $1.5 billion stock deal that shareholders from both banks approved April 29 and the Federal Reserve approved Friday, according to Associated Press business writer Alan Sayre.

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Public Companies

Whitney loses $88 million in fourth quarter

New Orleans-based Whitney Holding Corp., which is in the midst of a merger with Hancock Holding Co. of Mississippi, reported a net loss of $88.5 million for the fourth quarter of 2010, compared to a net loss of $29 million in the third quarter and net income of $300,000 in the fourth quarter of 2009. Including the $4.1 million dividend paid each quarter to the U.S. Treasury on the preferred stock issued under TARP, the loss per diluted common share was 96 cents for the fourth quarter of 2010, 34 cents for the third quarter of 2010 and 4 cents for the fourth quarter of 2009.

“The results for the fourth quarter were in line with our previously announced problem credit resolution strategy,” said John C. Hope III, chairman and CEO. “Operating results outside of credit also were in line with expectations. I continue to believe we are in a position to return to full-year profitability beginning in the first quarter of 2011, excluding any merger-related items. I also expect the company to contribute meaningfully to the long-term success of the Hancock/Whitney combination.”

On Dec. 21, Whitney agreed to be purchased by Gulfport-based Hancock in $1.5 billion deal expected to close in the second quarter of this year. — Walter Pierce

Home, Regions, Teche increase earnings

Two Acadiana banks, Home and Teche, along with Alabama-based Regions, reported increased earnings for the most recent quarter.

Home Bank’s parent company, Home Bancorp, earned $1.5 million in the fourth quarter of 2010, a 61 percent increase over the $555,400 it earned in the third quarter and an increase of $1.4 million, or 6.67 percent, compared to the fourth quarter of 2009. Net income for the year was $4.7 million, an increase of $9,000, or 0.2 percent, compared to 2009. Earnings per share were 20 cents for the fourth quarter of 2010, an increase of 67 percent compared to the third quarter of 2010. Earnings per share were 62 cents for the year, an increase of 7 percent over 2009.

John W. Bordelon, president and CEO, said highlights from the year included the bank’s Northshore acquisition, the opening of its third Baton Rouge location and continued loan and deposit growth across each of its markets.
Teche Federal Bank’s parent, Teche Holding Company, earned $1.8 million or 87 cents per diluted share, in the quarter ended Dec. 31, which represents the first quarter of its fiscal 2011. That compares with $1.7 million or 82 cents per diluted share for the same quarter in fiscal 2010, an increase of 5 cents per share, or 6.1 percent.

Teche President and CEO Patrick Little said two years ago Teche declined Troubled Asset Relief Program money in part because the bank saw a very challenging regulatory and economic environment in the coming years. “We did not want to be in a position to be over-capitalized and thus desperate to grow and expand in the midst of higher unemployment and a slower economy,” Little explains. “We think we made the right decision.”
Also, Regions Financial Corp., which has been working to overcome losses on real estate loans, has returned to profitability. In the fourth quarter of 2010, the Birmingham-based bank earned $36 million, or 3 cents per share, compared to a loss of 17 cents per share for the third quarter and a 2009 fourth quarter loss of $606 million, or 51 cents a share. Full year results reflect a net loss of 62 cents per share, compared with a net loss of $1.27 per share in 2009.

In other banking news:
• IberiaBank Corp. reported fourth quarter net income of $13 million, or 48 cents per share — down 89 percent compared to the same quarter in 2010 when the company reported an $181 million gain on acquisitions. Thomson Financial analysts expected the bank to post earnings of 55 cents per share in the fourth quarter.
• MidSouth Bancorp Inc. reported net income of $1.6 million for the fourth quarter of 2010, an increase of 74.8 percent compared to the $890,000 it earned for the fourth quarter of 2009. — WP
IberiaBank dubbed ‘big dog on the block’

The acquisition of Louisiana banking giant Whitney Bank by Hancock Holding of Mississippi has prompted a new nickname for IberiaBank: ‘Big dog on the block.’

Associated Press business writer Alan Sayre wrote Jan. 31 that the new Whitney-Hancock combo will mean the exodus of the last of the “classic” Louisiana-based banks, making room for IberiaBank to take the top spot.

Sayre points out that the Whitney-Hancock union also outlines a potential future trend of community banks having a larger presence in the industry, which could mean more mergers to increase their pull in lending: “After Whitney loses its separate identity, the big dog on the block in Louisiana appears to be Lafayette-based IberiaBank, which has a smaller, but feisty rival in its back yard, MidSouth Bancorp. More combinations in the South are inevitable, banking analyst Michael Rose of Raymond James said recently, with Hancock-Whitney likely pointing the way to a new era of mergers and acquisitions following big loan problems in the region and new federal capital requirements.”

After Sayre gave IberiaBank its new nickname, it came to light just how big this dog almost got. It is now common knowledge that Iberia lost a December bidding battle with Hancock in the Whitney

With the backing of the Federal Deposit Insurance Corp., which agreed to share in any loan losses, IberiaBank has acquired four failed banks since the financial meltdown, three in Florida and one in Alabama. — WP

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Public Companies November/December

LHC Group’s earnings up 35%

Neither a Securities and Exchange Commission investigation nor a Senate Finance Committee inquiry into its billing practices dampened home health provider LHC Group’s (Nasdaq: LHCG) third quarter earnings. The company bested by 3 cents analysts’ predictions of earnings of 70 cents per share, reporting net income of $13.3 million, compared with $9.8 million or 54 cents per share for the quarter ending Sept. 30, 2009.

LHC Group is among four publicly traded companies under investigation by the SEC for allegedly ordering unnecessary home visits in order to reach thresholds and trigger bonus Medicare reimbursements. The investigations were prompted by an April 2010 Wall Street Journal investigative report on the industry’s billing practices. The local company denies wrongdoing and says it is cooperating with investigators.

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Public Companies Aug/Sept 2010

Wednesday, August 25, 2010
Written by Leslie Turk

Teche reports record earnings for nine-month period

Earnings at Teche Holding Company (Amex: TSH) for the nine month period ended June 30 amounted to $5.25 million, a record $2.49 per diluted share, compared to $5.15 million, or $2.42 per diluted share, for the same period in fiscal year 2009. The earnings represent an increase of $0.07 per diluted share, or 2.9 percent.

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Public Companies July/August 2010

IberiaBank, MidSouth Bank say exposure on oil spill limited

Responding to media inquiries and the investment community, officials at IberiaBank Corp. (Nasdaq: IBKC) and MidSouth Bank (NYSE Amex: MSL) each made public disclosures explaining their exposure to the Gulf of Mexico oil spill.

IberiaBank said June 8 that its $5.7 billion loan portfolio has only limited exposure to industries that are being impacted by the ongoing Gulf disaster. It noted that the three industries that face the greatest perceived impact of this event are fishing and seafood, seasonal beach tourist businesses, and the Gulf energy sector. As of March 31, 2010, the bank’s total loan portfolio was geographically diverse with limited industry concentrations, particularly as related to those three industries. Its exposure to the fishing and seafood industries was less than $10,000 at May 31, and it essentially has no credit exposure to seasonal beach tourist businesses. It has no branches or lending activity in the Panhandle of Florida or on the Alabama coast.

Based on a preliminary review of its energy-related businesses, IberiaBank estimated that clients with a direct impact had aggregate loan balances of approximately $67 million (1 percent of total loans), those with an indirect impact totaled approximately $17 million (less than 1 percent of total loans), and those clients with no perceived impact totaled approximately $99 million.

Two weeks after IberiaBank’s announcement, MidSouth Bank confirmed it, too, has limited direct exposure to deepwater drilling, roughly $15 million. Based on total loans of $576 million at March 31, 2010, this direct exposure represents less than 3 percent of the bank’s loan portfolio. While MidSouth has a history of strong lending to the oil services industry, the majority of those loans are concentrated to companies that drill on land or in shallow water or service the production side of the industry, representing approximately 16 percent of the loan portfolio.

Like IberiaBank, MidSouth does not have meaningful loan exposure on fishing and seafood and beach tourism. MidSouth noted that the near term impact of the containment and clean-up efforts associated with the oil spill had been somewhat positive to the hospitality, restaurant and boating industries for its markets in south Louisiana. “The long term indirect impact for MidSouth of this unfortunate event remains uncertain in the face of the recent moratorium on deepwater drilling and anticipated changes to industry regulations,” the bank wrote.

OMNI shareholders fight to stop acquisition

Carencro-based OMNI Energy Services Corp. (Nasdaq: OMNI) said July 16 that the “go shop” period on its planned acquisition by New York City-based Wellspring Capital Management LLC had expired. Announced June 3, the deal calls for Wellspring to acquire all of OMNI’s outstanding shares for $2.75 per share in cash in a deal valued at about $57.8 million as the environmental- and seismic-services provider for the oil and gas industry aims to strengthen its balance sheet. The total transaction is valued at $122 million, including assumption of debt.

The cash consideration represents a premium of almost 30 percent over the closing price of OMNI shares on June 3. “We believe this transaction will deliver an immediate and significant premium for our shareholders especially in light of the uncertain markets after the unprecedented drop in our end markets in 2009 and the continued current uncertainty in the Gulf of Mexico,” said Brian J. Recatto, president and CEO of OMNI, in announcing the deal.

A number of shareholders took issue with the merger, which was soon met by an onslaught of lawsuits: six state court actions in Louisiana and a similar action claiming violation of federal securities laws was brought in federal court in Lafayette. Plaintiffs accuse OMNI executives of issuing misleading proxy statements and claim the deal undervalues the company. In part they argue that the transaction appears to be unfair, given that OMNI stock was trading at $3.32 a share as recently as April 30, 2010, and was trading at $2.82 a share on May 4. Some shareholders also claimed the “go shop” portion of the merger agreement wrongfully gave Wellspring access to any rival bidders’ information and allowed Wellspring a free right to top any superior offer.

The merger agreement allowed OMNI to actively seek other possible bidders and to respond to unsolicited inquiries by others interested in acquiring the company. But after soliciting 97 identified possible purchasers in accordance with the “go shop” provisions of the agreement, the company says it did not receive any acquisition proposals and is no longer allowed to initiate or solicit proposals or continue negotiations or discussions regarding an acquisition proposal.

Under certain circumstances, however, the company may participate in discussions and negotiations with a third party if it receives an unsolicited acquisition proposal that could reasonably be expected to constitute a superior proposal.

OMNI says it has filed a motion in the state proceedings to consolidate the state actions and to stay any actions pending the federal court’s consideration of the federal suit. OMNI says all the actions are without merit and that it intends to vigorously defend against them.

On May 5, OMNI reported a first quarter 2010 net loss of $0.8 million, $0.05 per diluted share, on revenues of $26.8 million, compared to a net income of $0.9 million, $0.04 per diluted share, on revenues of $34.9 million for the same period of 2009. The company said the decrease in net income is due in large part to reduced activity in its Seismic Services segment.

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