Hancock Holding Company Announces 1Q 2011 Financial Results

Hancock Holding Company (Nasdaq:HBHC) today announced financial results for the quarter ended March 31, 2011. Net income was $15.3 million, with fully diluted earnings per share of $0.41. The first quarter's earnings were impacted by $1.6 million in merger related expenses associated with the proposed acquisition of Whitney Holding Corporation (as discussed below) and also by Hancock's recent common equity offering (also discussed below). Excluding the merger related expenses, net income was $16.4 million with fully diluted earnings per share of $0.43.

Excluding merger related items, net income of $16.4 million increased 10.8 percent from 2010's first quarter's net income of $14.8 million but declined 3.9 percent over the preceding fourth quarter's net income of $17.0 million. Fully diluted earnings per share excluding merger related items for the first quarter of 2011 were $0.43, compared to $0.40 for the same quarter a year ago and $0.46 in the 2010's fourth quarter. Hancock's return on average assets, excluding merger related items, was 0.81 percent for the first quarter of 2011, an improvement of 12 basis points over the prior year period return of average assets of 0.69 percent.

The company's pre-tax, pre-provision profit for the first quarter of 2011 increased 2.5 percent over the prior year's first quarter to $32.4 million. Pre-tax pre-provision profit is total revenue less non-interest expense and excludes one-time merger items and securities transactions.

On December 21, 2010, Hancock Holding Company entered into a definitive agreement with Whitney Holding Corporation ("Whitney"), parent company of New Orleans-based Whitney National Bank, for Whitney to merge into Hancock. The combined company will have approximately $20 billion in assets and operate more than 300 branches across the Gulf South. The transaction is expected to be completed in the second quarter of 2011, subject to customary closing conditions and shareholder and regulatory approval.

On March 25, 2011, the company completed a successful common stock offering of 6,201,500 shares of common stock at a price of $32.25 per share, which represented no discount from the last sale on the previous business day. Net proceeds were approximately $191 million. The proceeds of the offering are intended to be used for general corporate purposes, including the enhancement of Hancock's capital position and the repurchase of Whitney's TARP preferred stock and warrants upon closing of the proposed merger. The company's tangible common equity ratio stood at 11.94 percent at March 31, 2011.

Hancock's President and Chief Executive Officer Carl J. Chaney said, "We are very pleased to report improvement in our first quarter earnings as we continue to see an upturn in our asset quality measures. In addition, our stock offering this quarter generated overwhelming interest and was rated the number one equity offering in the U.S. over the past 12 months, in terms of no discount from the last sale on the previous business day. We believe the response reflected the company's 110-year history of financial strength and stability and excitement about the pending merger with Whitney which is on track to close in the second quarter of this year."

Chaney continued, "Our operating footprint will grow dramatically in Hancock's current Gulf Coast markets, and we will expand into dynamic new regions such as Houston and Tampa-St. Petersburg upon completion of the transaction. Based upon combined assets, Hancock will become the 32nd largest bank holding company headquartered in America."

The principal driver of Hancock's improved 2011 first quarter earnings from the prior year's first quarter was the continued improvement in the company's overall asset quality. The company recorded a significantly lower provision for loan losses, down $5.0 million, or 36.2 percent, compared to the prior year's first quarter. Net charge-offs of $6.8 million decreased $6.4 million, or 48.6 percent, from the 2010 first quarter and decreased $2.9 million, or 30.1 percent, from the prior quarter. Net charge-offs were 0.57 percent of average loans, down 49 basis points from the first quarter of 2010 and down 21 basis points, compared with the preceding fourth quarter.

"With our improved asset quality measures, the approaching merger with Whitney, and a favorable economic outlook for our market areas, we are very excited about what the next 12 months will bring. These events position us very favorably for future growth and prosperity," Chaney added.

Highlights & Key Operating Items from Hancock's First Quarter Results

Balance Sheet & Capital

Total assets at March 31, 2011, were $8.3 billion, up $172.7 million, or 2.1 percent, from $8.1 billion at December 31, 2010. Compared to March 31, 2010, total assets decreased $254.4 million. Hancock continues to remain well capitalized, with total equity of $1.1 billion at March 31, 2011, up $206.9 million, or 24.3 percent, from March 31, 2010, and up $201.2 million, or 23.5 percent, from December 31, 2010, due to the common stock offering in March of this year. The company's tangible common equity ratio stood at 11.94 percent at March 31, 2011.