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Hilltop Holdings Inc. Announces Financial Results For 2012

Stocks in this article: HTH

Hilltop Holdings Inc. (NYSE: HTH) (“Hilltop”), the parent company of PlainsCapital Corporation (“PlainsCapital”) and NLASCO, Inc., its insurance subsidiary, announced financial results for 2012. PlainsCapital, through its operating subsidiaries: PlainsCapital Bank, PrimeLending and First Southwest, provides banking, mortgage origination and financial advisory services.

Hilltop completed its acquisition of PlainsCapital on November 30, 2012. As a result of the acquisition, the operating results of Hilltop for the year ended December 31, 2012 include PlainsCapital’s operating results since December 1, 2012 and reflect the following:

  • Hilltop’s total assets grew to $7.3 billion at December 31, 2012 compared to $0.9 billion at the end of 2011;
  • Total stockholders’ equity increased 75 percent in 2012 to $1.1 billion at December 31, 2012;
  • With the addition of PlainsCapital, Hilltop held $3.1 billion in Loans Held for Investment, net of Allowance for Loan Losses, and $1.4 billion in Loans Held for Sale at December 31, 2012;
  • The operating results for 2012 was a net loss of $5.9 million, versus a net loss of $6.5 million for 2011;
  • Diluted loss per common share for 2012 was $0.10, compared to diluted loss per common share of $0.12 for 2011;
  • Certain items included in net loss for 2012 resulted from purchase accounting, compensation expense-related to retention agreements and acquisition-related expenses associated with the PlainsCapital transaction. The pre-tax effects of these items include compensation expense of $8.9 million, specific acquisition-related expenses of $6.6 million, net accretion on acquired earning assets and liabilities of $6.1 million and amortization of identifiable intangibles of $0.8 million. The after-tax impact of these items was to increase the 2012 net loss by $7.7 million;
  • Hilltop is well capitalized with a Tier 1 Leverage Ratio 1 of 13.08% and Total Capital Ratio of 17.81%; and
  • Post-acquisition Hilltop maintains over $200 million of freely usable cash.

The final total consideration paid by Hilltop to acquire PlainsCapital was $813.5 million, consisting of:

  • $311.8 million in cash;
  • $387.6 million of Hilltop common stock; and
  • $144.1 million of Hilltop Series B Preferred Stock under the Small Business Lending Fund program.

“2012 was a transformational year for Hilltop. We are excited about the PlainsCapital acquisition and look forward to working with the outstanding team at PlainsCapital,” said Jeremy Ford, CEO of Hilltop. “With PlainsCapital, NLASCO and $200 million of freely usable cash, we believe Hilltop is well positioned for the future.”

 
 
HILLTOP HOLDINGS INC. AND SUBSIDIARIES
(dollars, in thousands)
Selected Balance Sheet Information
           
December 31,
2012 2011 Change
 
Loans held for sale 1,399,944 - nm
Loans, net 3,148,987 - nm
Goodwill 253,770 23,988 958%
Other intangible assets, net 77,738 9,074 757%
Total assets 7,286,865 925,425 687%
Total deposits 4,700,461 - nm
Total stockholders' equity 1,146,550 655,383 75%
 
"nm" refers to not meaningful as a result of the acquisition of PlainsCapital
               
 
HILLTOP HOLDINGS INC. AND SUBSIDIARIES
(dollars, in thousands, except per share data)
Selected Quarterly Financial Information (Unaudited)
 
Year Ended December 31, 2012
Fourth Third Second First
Quarter Quarter Quarter Quarter
Interest income $ 28,954 $ 3,379 $ 3,349 $ 3,356
Interest expense   3,786   2,140     2,131     2,139
Net interest income 25,168 1,239 1,218 1,217
Provision for loan losses 3,800 - - -
Noninterest income 109,691 39,591 38,063 36,887
Noninterest expense   115,934   46,792     55,233     37,558
Income (loss) before income taxes 15,125 (5,962 ) (15,952 ) 546
Income tax provision (benefit)   5,809   (1,914 )   (5,243 )   203
Net income (loss) 9,316 (4,048 ) (10,709 ) 343
Less: Net income attributable to noncontrolling interest   494   -     -     -
Net income (loss) attributable to Hilltop Holdings $ 8,822 $ (4,048 ) $ (10,709 ) $ 343
Dividends on preferred stock   259   -     -     -
Income (loss) applicable to Hilltop Holdings common stockholders $ 8,563 $ (4,048 ) $ (10,709 ) $ 343
 
Earnings (loss) per common share:
Basic $ 0.13 $ (0.07 ) $ (0.19 ) $ 0.01
Diluted $ 0.13 $ (0.07 ) $ (0.19 ) $ 0.01
 

About Hilltop Holdings

Hilltop is a Dallas-based financial holding company that is a regional commercial banking franchise and insurance company. Through its wholly owned subsidiary, PlainsCapital Corporation, it has three operating subsidiaries: PlainsCapital Bank, PrimeLending, and First Southwest. Through its other wholly owned subsidiary, NLASCO, Inc., it provides property and casualty insurance from two insurance companies. At December 31, 2012, Hilltop employed 3,950 people and operated approximately 330 locations in 42 states. Hilltop's common stock is listed on the New York Stock Exchange under the symbol "HTH." Find more information at Hilltop-Holdings.com and PlainsCapital.com.

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