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Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Business First Bancshares, Inc., Announces Financial Results for Q3 2019

October 23, 2019 GMT

BATON ROUGE, La., Oct. 23, 2019 (GLOBE NEWSWIRE) -- Business First Bancshares, Inc. (NASDAQ: BFST) (Business First), parent company of Business First Bank, Baton Rouge, Louisiana, today announced its unaudited results for the quarter ended September 30, 2019, including quarterly net income of $5.5 million, or $0.40 per diluted share, increases of $1.6 million and $0.07, respectively, from the quarter ended September 30, 2018. Core net income, which excludes noncore income and expenses, was $6.3 million, or $0.46 per diluted share, which reflects increases of $1.8 million and $0.09, respectively, from the quarter ended September 30, 2018.

“I am pleased with our company’s performance for the quarter as we continue to successfully navigate our way through the uncertainties of the current interest rate environment,” said Jude Melville, president and CEO. “In addition to maintaining a healthy net interest margin despite multiple reductions in the federal funds rate over the course of the quarter, we booked double-digit annualized loan growth and, most importantly, maintained sound credit quality.”

On October 17, 2019, Business First’s board of directors declared a quarterly dividend based upon financial performance for the quarter in the amount of $0.10 per share, same as the prior quarter, to the common shareholders of record as of November 15, 2019. The dividend will be paid on November 30, 2019, or as soon thereafter as practicable.

Quarterly Highlights

-- Continued, Strong Loan Growth. Total loans held for investment at September 30, 2019 were $1.7 billion, an increase of $52.2 million compared to June 30, 2019. Annualized loan growth for the quarter ended September 30, 2019, was 12.7%, compared to 14.2% loan growth for the quarter ended June 30, 2019, and 14.5% year to date. -- Mitigated Net Interest Margin and Spread Impact. Net interest margin and spread were negatively impacted compared to prior quarter due to two 25 basis points federal funds rate cuts for the quarter ended September 30, 2019, one at the end of July and one in mid-September. Net interest margin and net interest spread were 4.10% and 3.66%, respectively, for the quarter ended September 30, 2019 compared to 4.19% and 3.75% for the quarter ended June 30, 2019. Excluding loan discount accretion, net interest margin and spread were 3.99% and 3.55%, respectively, for the quarter ended September 30, 2019, compared to 4.02% and 3.58% for the quarter ended June 30, 2019. -- Sound Credit Quality.Ratios of nonperforming loans compared to loans held for investment and nonperforming assets compared to total assets increased from 0.61% and 0.58%, respectively, at June 30, 2019, to 0.70% and 0.64% at September 30, 2019. The increases were largely attributable to the classification of a $1.5 million credit relationship to nonaccrual status. -- Stock Repurchase Program.During the quarter ended September 30, 2019, Business First spent $2.6 million to repurchase 110,846 shares at an average price of $23.00 per share under its previously announced stock repurchase program. Under the terms of the stock repurchase program, Business First is authorized to spend an additional $12.4 million to repurchase shares through December 2020. -- Richland State Bank Conversion.Business First successfully completed the data processing conversion of Richland State Bank on July 22, 2019.

Financial Condition

September 30, 2019, Compared to June 30, 2019

Balance Sheet

As of September 30, 2019, Business First had total assets of $2.2 billion, total loans of $1.7 billion, total deposits of $1.7 billion and total shareholders’ equity of $280.3 million, compared to $2.2 billion, $1.6 billion, $1.7 billion and $277.5 million, respectively, as of June 30, 2019.

Total loans held for investment increased by $52.2 million compared to June 30, 2019, or 12.7% annualized, for the quarter ended September 30, 2019, with most of the growth originating within the nonfarm nonresidential commercial real estate portfolio.

Book value per common share was $21.12 at September 30, 2019, compared to $20.77 at June 30, 2019. Tangible book value per common share was $16.96 at September 30, 2019, compared to $16.60 at June 30, 2019.

Credit Quality

Nonperforming loans as a percentage of total loans held for investment increased from 0.61% as of June 30, 2019, to 0.70% as of September 30, 2019. Nonperforming assets as a percentage of total assets increased from 0.58% as of June 30, 2019, to 0.64% as of September 30, 2019. The increase was largely attributable to the classification of a $1.5 million credit relationship to nonaccrual status.

September 30, 2019, Compared to September 30, 2018

Balance Sheet

As of September 30, 2019, Business First had total assets of $2.2 billion, total loans of $1.7 billion, total deposits of $1.7 billion and total shareholders’ equity of $280.3 million, compared to $1.7 billion, $1.3 billion, $1.4 billion and $213.0 million, respectively, as of September 30, 2018. The balance sheet increases were attributable to organic growth and to the fourth quarter 2018 acquisition of Richland State Bank.

Book value per common share was $21.12 at September 30, 2019, compared to $18.46 at September 30, 2018. Tangible book value per common share was $16.96 at September 30, 2019, compared to $15.30 at September 30, 2018.

Credit Quality

Nonperforming loans as a percentage of total loans held for investment decreased from 0.89% as of September 30, 2018, to 0.70% as of September 30, 2019. Nonperforming assets as a percentage of total assets decreased from 0.80% as of September 30, 2018, to 0.64% as of September 30, 2019. The decreases were mainly attributable to improved credit quality in relation to the size of the loan portfolio and total assets of Business First.

Results of Operations

Third Quarter 2019 Compared to Second Quarter 2019

Net Income and Diluted Earnings Per Share

For the quarter ended September 30, 2019, net income was $5.5 million, or $0.40 per diluted share, compared to net income of $6.8 million, or $0.50 per diluted share, for the quarter ended June 30, 2019.

Core net income, which excludes noncore income and expenses, for the quarter ended September 30, 2019, was $6.3 million, or $0.46 per diluted share, compared to core net income of $6.6 million, or $0.48 per diluted share, for the quarter ended June 30, 2019. Notable noncore events impacting earnings for the quarter ended September 30, 2019 included the incurrence of $594,000 in losses associated with the disposal of former bank premises and equipment in noninterest income and $288,000 associated with acquisition-related expenses in noninterest expense, compared to noninterest expenses of $436,000 associated with acquisition-related expenses and noninterest income of $593,000 related to gains from the sale of a banking center for the quarter ended June 30, 2019.

Return on Assets and Equity

Return on average assets and equity, each on an annualized basis, decreased to 1.02% and 7.93%, respectively, for the quarter ended September 30, 2019, compared to 1.30% and 10.13%, respectively, for the quarter ended June 30, 2019. The decreases were largely attributable to the $1.3 million Small Business Investment Company “SBIC” investment income and $593,000 banking center gain on sale recognized for the quarter ended June 30, 2019, and $594,000 in losses on disposal of former bank premises and equipment recognized for the quarter ended September 30, 2019, offset by a reduction in the provision for loan losses of $823,000 for the quarter ended September 30, 2019 compared to the quarter ended June 30, 2019.

As adjusted, core return on average assets and core return on average equity, each on an annualized basis, were 1.16% and 9.01%, respectively, for the quarter ended September 30, 2019, compared to 1.26% and 9.77%, respectively, for the quarter ended June 30, 2019.

Interest Income

For the quarter ended September 30, 2019, net interest income totaled $20.3 million and net interest margin and net interest spread were 4.10% and 3.66%, respectively, compared to $20.2 million, 4.19% and 3.75% for the quarter ended June 30, 2019. The decrease in net interest margin was largely attributable to lower loan discount accretion and lower yielding loans due to the two 25 basis points federal funds rate cuts, offset by an additional calendar day for the quarter ended September 30, 2019.

Net interest margin and net interest spread (excluding loan discount accretion of $544,000) were 3.99% and 3.55%, respectively, for the quarter ended September 30, 2019, compared to 4.02% and 3.58% (excluding loan discount accretion of $826,000) for the quarter ended June 30, 2019. The ratios were negatively impacted by lower yielding loans due to the two 25 basis points federal funds rate cuts, offset by an additional calendar day for the quarter ended September 30, 2019.

The average yield on the loan portfolio was 5.87% for the quarter ended September 30, 2019, compared to 5.96% for the quarter ended June 30, 2019. The average yield on total interest-earning assets was 5.32% for the quarter ended September 30, 2019, compared to 5.37% for the quarter ended June 30, 2019.

Business First anticipates continued pressure on net interest margin in future periods based on the current yield curve.

Interest Expense

For the quarter ended September 30, 2019, overall cost of funds (which includes noninterest-bearing deposits) increased by five basis points compared to the quarter ended June 30, 2019.

Provision for Loan Losses

During the quarter ended September 30, 2019, Business First recorded a provision for loan losses of $479,000, compared to $1.3 million for the quarter ended June 30, 2019. The reserve for the quarter ended June 30, 2019 was negatively impacted by the charge-off of the remaining balance of a single, previously identified, impaired loan.

Third Quarter 2019 Compared to Third Quarter 2018

Net Income and Diluted Earnings Per Share

For the quarter ended September 30, 2019, net income was $5.5 million, or $0.40 per diluted share, compared to net income of $3.9 million, or $0.33 per diluted share, for the quarter ended September 30, 2018. The increase in net income and diluted earnings per share resulted from the overall growth and efficiency of Business First over the past 12 months, mainly attributable to growth in net interest income and partially offset by increases in noninterest expenses. Both the growth in net interest income and increase in noninterest expenses were impacted for the quarter ended September 30, 2019, by the acquisition of Richland State Bank which occurred in the fourth quarter of 2018.

Core net income, which excludes noncore income and expenses, for the quarter ended September 30, 2019, was $6.3 million, or $0.46 per diluted share, compared to core net income of $4.4 million, or $0.37 per diluted share, for the quarter ended September 30, 2018. Notable noncore events impacting earnings for the quarter ended September 30, 2019 included the incurrence of $594,000 in losses associated with the disposal of former bank premises and equipment in noninterest income and $288,000 associated with acquisition-related expenses in noninterest expense, compared to noninterest expenses of $509,000 associated with acquisition-related expenses and $139,000 of losses associated with the disposal of former bank premises and equipment in noninterest income for the quarter ended September 30, 2018.

Return on Assets and Equity

Return on average assets and return on average equity, each on an annualized basis, increased to 1.02% and 7.93%, respectively, for the quarter ended September 30, 2019, from 0.94% and 7.37%, respectively, for the quarter ended September 30, 2018.

As adjusted, core return on average assets and core return on average equity, each on an annualized basis, were 1.16% and 9.01%, respectively, for the quarter ended September 30, 2019, compared to 1.06% and 8.37%, respectively, for the quarter ended September 30, 2018.

Interest Income

For the quarter ended September 30, 2019, net interest income totaled $20.3 million and net interest margin and net interest spread were 4.10% and 3.66%, respectively, compared to $15.6 million, 4.05% and 3.70% for the quarter ended September 30, 2018.

Net interest margin and net interest spread (excluding loan discount accretion of $544,000) were 3.99% and 3.55%, respectively, for the quarter ended September 30, 2019, compared to 3.98% and 3.63% (excluding loan discount accretion of $268,000) for the quarter ended September 30, 2018.

The average yield on the loan portfolio was 5.87% for the quarter ended September 30, 2019, compared to 5.65% for the quarter ended September 30, 2018. The averageyield on total interest-earning assets was 5.32% for the quarter ended September 30, 2019, compared to 5.01% for the quarter ended September 30, 2018.

Interest Expense

For the quarter ended September 30, 2019, overall cost of funds (which includes noninterest-bearing deposits) increased by 29 basis points compared to the quarter ended September 30, 2018. The increase was largely attributable to an overall increase in interest rates over the past 12 months and the issuance of subordinated debt in December 2018.

Provision for Loan Losses

During the quarter ended September 30, 2019, Business First recorded a provision for loan losses of $479,000, compared to $503,000 for the quarter ended September 30, 2018.

About Business First Bancshares, Inc.

Business First Bancshares, Inc., through its banking subsidiary Business First Bank, operates in 25 banking centers in markets across Louisiana and in Dallas, Texas. Business First Bank provides commercial and personal banking, treasury management and wealth solutions services to small to midsize businesses and their owners and employees. Visit www.b1BANK.com for more information. Business First’s common stock is traded on the NASDAQ Global Select Market under the symbol “BFST.”

Non-GAAP Financial Measures

This press release includes certain non-GAAP financial measures (e.g., referenced as “core” or “tangible”) intended to supplement, not substitute for, comparable GAAP measures. These measures typically adjust income available to common shareholders for certain significant activities or transactions that, in management’s opinion, can distort period-to-period comparisons of Business First’s performance. Transactions that are typically excluded from non-GAAP measures include realized and unrealized gains/losses on former bank premises and equipment, investment sales, impaired loan sales, acquisition-related expenses (including, but not limited to, legal costs, system conversion costs, severance and retention payments, etc.). Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core business. These non-GAAP disclosures are not necessarily comparable to non-GAAP measures that may be presented by other companies. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of the tables below.

Special Note Regarding Forward-Looking Statements

Certain statements contained in this release may not be based on historical facts and are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by their reference to a future period or periods or by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “may,” “might,” “will,” “would,” “could” or “intend.” We caution you not to place undue reliance on the forward-looking statements contained in this news release, in that actual results could differ materially from those indicated in such forward-looking statements as a result of a variety of factors. We undertake no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date of this news release.

Additional Information

For additional information on Business First, you may obtain Business First’s reports that are filed with the Securities and Exchange Commission, or SEC, free of charge by using the SEC’s EDGAR service on the SEC’s website at www.sec.gov or by contacting the SEC for further information at 1-800-SEC-0330. Alternatively, these documents can be obtained free of charge from Business First by directing a request to: Business First Bancshares, Inc., 500 Laurel Street, Suite 101, Baton Rouge, Louisiana 70801, Attention: Corporate Secretary.

No Offer or Solicitation

This release does not constitute or form part of any offer to sell, or a solicitation of an offer to purchase, any securities of the Company. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

Business First Bancshares, Inc. Selected Financial Information (Unaudited) September 30, June 30, March 31, December 31, September 30, (Dollars in thousands) 2019 2019 2019 2018 2018 ---------------------------------------- ------------- ------------- ------------- ------------- ------------- Balance Sheet Ratios Loans (HFI) to Deposits 97.77 % 96.46 % 90.93 % 88.15 % 95.86 % Shareholders’ Equity to Assets Ratio 12.62 % 12.88 % 12.81 % 12.41 % 12.69 % Loans Receivable Held for Investment Commercial $ 415,163 $ 411,256 $ 389,855 $ 363,640 $ 317,889 Real Estate: Construction and Land 220,524 227,102 211,888 211,054 196,404 Farmland 45,809 47,245 44,066 45,989 26,882 1-4 Family Residential 281,413 278,610 275,610 270,583 234,690 Multi-Family Residential 31,448 38,698 39,548 39,273 22,109 Nonfarm Nonresidential 620,427 561,149 550,103 518,660 432,306 - --------- - - --------- - - --------- - - --------- - - --------- - Total Real Estate 1,199,621 1,152,804 1,121,215 1,085,559 912,391 Consumer 79,943 78,513 75,112 79,270 67,679 Total Loans $ 1,694,727 $ 1,642,573 $ 1,586,182 $ 1,528,469 $ 1,297,959 - --------- - - --------- - - --------- - - --------- - - --------- - Allowance for Loan Losses Balance, Beginning of Period $ 11,603 $ 11,818 $ 11,220 $ 10,273 $ 9,756 Charge-offs – Quarterly (13 ) (1,565 ) (57 ) (19 ) (33 ) Recoveries – Quarterly 21 48 22 27 47 Provision for Loan Losses – Quarterly 479 1,302 633 939 503 Balance, End of Period $ 12,090 $ 11,603 $ 11,818 $ 11,220 $ 10,273 - --------- - - --------- - - --------- - - --------- - - --------- - Allowance for Loan Losses to Total Loans 0.71 % 0.71 % 0.75 % 0.73 % 0.79 % (HFI) Net Charge-offs (Recoveries) to Average 0.00 % 0.09 % 0.00 % -0.00 % 0.00 % Total Loans Nonperforming Assets Nonperforming Loans: Nonaccrual Loans $ 11,577 $ 9,363 $ 13,183 $ 11,691 $ 11,341 Loans Past Due 90 Days or More 277 727 77 1,876 256 Total Nonperforming Loans 11,854 10,090 13,260 13,567 11,597 - --------- - - --------- - - --------- - - --------- - - --------- - Other Nonperforming Assets: Other Real Estate Owned 2,326 2,324 1,683 1,909 1,824 Other Nonperforming Assets 5 6 11 11 11 Total Other Nonperforming Assets 2,331 2,330 1,694 1,920 1,835 - --------- - - --------- - - --------- - - --------- - - --------- - Total Nonperforming Assets $ 14,185 $ 12,420 $ 14,954 $ 15,487 $ 13,432 - --------- - - --------- - - --------- - - --------- - - --------- - Nonperforming Loans to Total Loans (HFI) 0.70 % 0.61 % 0.84 % 0.89 % 0.89 % Nonperforming Assets to Total Assets 0.64 % 0.58 % 0.71 % 0.74 % 0.80 %

Business First Bancshares, Inc. Selected Financial Information (Unaudited) Quarter Ended Nine Months Ended -------------------------------------------------------------------------- ----------------------------- September 30, June 30, March 31, December 31, September 30, September 30, September 30, (Dollars in thousands, except 2019 2019 2019 2018 2018 2019 2018 per share data) ------------------ -------------- -------------- -------------- -------------- -------------- -------------- -------------- Per Share Data Basic Earnings per $ 0.41 $ 0.51 $ 0.43 $ 0.28 $ 0.34 $ 1.35 $ 0.99 Common Share Diluted Earnings 0.40 0.50 0.41 0.28 0.33 1.32 0.95 per Common Share Dividends per 0.10 0.10 0.08 0.08 0.08 0.28 0.22 Common Share Book Value per 21.12 20.77 20.14 19.68 18.46 21.12 18.46 Common Share Tangible Book Value per Common 16.96 16.60 15.86 15.34 15.30 16.96 15.30 Share (Non-GAAP) Average Common 13,315,351 13,361,482 13,287,560 12,099,659 11,533,374 13,321,566 10,795,989 Shares Outstanding Average Diluted 13,669,370 13,740,937 13,653,125 12,521,017 11,993,734 13,675,585 11,256,349 Shares Outstanding End of Period Common Shares 13,274,823 13,361,482 13,361,482 13,213,280 11,533,721 13,274,823 11,533,721 Outstanding Annualized Performance Ratios Return on Average 1.02 % 1.30 % 1.09 % 0.75 % 0.94 % 1.14 % 0.87 % Assets Return on Average 7.93 % 10.13 % 8.62 % 6.03 % 7.37 % 8.88 % 7.45 % Equity Net Interest 4.10 % 4.19 % 4.01 % 4.07 % 4.05 % 4.10 % 4.00 % Margin Net Interest 3.66 % 3.75 % 3.61 % 3.70 % 3.70 % 3.68 % 3.72 % Spread Efficiency Ratio 67.16 % 59.85 % 64.35 % 73.51 % 69.08 % 63.65 % 71.11 % (1) Other Operating Expenses Salaries and $ 8,793 $ 8,756 $ 8,552 $ 7,444 $ 7,190 $ 26,101 $ 20,418 Employee Benefits Occupancy and Bank 1,230 1,079 1,103 877 914 3,412 2,632 Premises Depreciation and 645 633 628 484 417 1,906 1,246 Amortization Data Processing 380 576 616 397 395 1,572 1,160 FDIC Assessment (105 ) 248 150 276 221 293 945 Fees Legal and Other 346 353 318 456 328 1,017 1,239 Professional Fees Advertising and 544 279 327 422 290 1,150 817 Promotions Utilities and 397 323 298 238 294 1,018 835 Communications Ad Valorem Shares 345 345 345 170 321 1,035 965 Tax Directors’ Fees 121 125 205 92 93 451 344 Other Real Estate Owned Expenses and 19 72 27 - - 118 9 Write-Downs Merger and Conversion-Related 350 235 (254 ) 1,959 138 331 1,065 Expenses Other 1,813 1,553 1,475 1,594 1,269 4,841 4,164 Total Other $ 14,878 $ 14,577 $ 13,790 $ 14,409 $ 11,870 $ 43,245 $ 35,839 Expenses - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - (1) Noninterest expense (excluding provision for loan losses) divided by noninterest income plus net interest income less gain/loss on sales of securities.

Business First Bancshares, Inc. Consolidated Balance Sheets (Unaudited) September 30, June 30, March 31, December 31, September 30, (Dollars in thousands) 2019 2019 2019 2018 2018 -------------------------------------- ------------- ------------- ------------- ------------- ------------- Assets Cash and Due From Banks $ 63,356 $ 64,043 $ 52,606 $ 96,072 $ 45,941 Federal Funds Sold 43,705 20,809 30,093 41,836 5,934 Securities Available for Sale, at Fair 288,231 294,981 304,122 309,516 243,585 Values Mortgage Loans Held for Sale 256 443 753 58 280 Loans and Lease Receivable 1,694,727 1,642,573 1,586,182 1,528,469 1,297,959 Allowance for Loan Losses (12,090 ) (11,603 ) (11,818 ) (11,220 ) (10,273 ) - --------- - - --------- - - --------- - - --------- - - --------- - Net Loans and Lease Receivable 1,682,637 1,630,970 1,574,364 1,517,249 1,287,686 Premises and Equipment, Net 27,092 27,577 27,014 15,114 10,022 Accrued Interest Receivable 7,513 7,957 7,054 8,223 5,188 Other Equity Securities 12,697 11,717 8,508 9,282 10,339 Other Real Estate Owned 2,326 2,324 1,683 1,909 1,824 Cash Value of Life Insurance 32,398 32,223 32,050 31,882 24,442 Deferred Taxes, Net 2,674 2,527 3,077 3,848 4,359 Goodwill 48,333 48,503 49,534 49,488 32,427 Core Deposit Intangible 6,916 7,139 7,655 7,885 4,103 Other Assets 2,706 2,395 2,887 2,534 2,065 - --------- - - --------- - - --------- - - --------- - - --------- - Total Assets $ 2,220,840 $ 2,153,608 $ 2,101,400 $ 2,094,896 $ 1,678,195 - --------- - - --------- - - --------- - - --------- - - --------- - Liabilities Deposits: Noninterest-Bearing $ 406,146 $ 394,848 $ 396,775 $ 382,354 $ 311,170 Interest-Bearing 1,327,244 1,308,054 1,347,608 1,351,580 1,042,901 - --------- - - --------- - - --------- - - --------- - - --------- - Total Deposits 1,733,390 1,702,902 1,744,383 1,733,934 1,354,071 Securities Sold Under Agreements to 31,037 16,096 11,070 12,229 14,310 Repurchase Short-Term Borrowings - - - - 862 Long-Term Borrowings - - - - 2,400 Subordinated Debt 25,000 25,000 25,000 25,000 - Federal Home Loan Bank Borrowings 128,000 108,000 30,000 55,000 85,000 Accrued Interest Payable 1,837 1,924 2,039 1,374 1,336 Other Liabilities 21,236 22,217 19,764 7,301 7,255 - --------- - - --------- - - --------- - - --------- - - --------- - Total Liabilities 1,940,500 1,876,139 1,832,256 1,834,838 1,465,234 - --------- - - --------- - - --------- - - --------- - - --------- - Shareholders’ Equity Common Stock 13,275 13,361 13,361 13,213 11,534 Additional Paid-In Capital 212,104 213,823 213,537 212,332 171,345 Retained Earnings 52,265 48,087 42,576 37,982 35,460 Accumulated Other Comprehensive Loss 2,696 2,198 (330 ) (3,469 ) (5,378 ) - --------- - - --------- - - --------- - - --------- - - --------- - Total Shareholders’ Equity 280,340 277,469 269,144 260,058 212,961 - --------- - - --------- - - --------- - - --------- - - --------- - Total Liabilities and Shareholders’ $ 2,220,840 $ 2,153,608 $ 2,101,400 $ 2,094,896 $ 1,678,195 Equity - --------- - - --------- - - --------- - - --------- - - --------- -

Business First Bancshares, Inc. Consolidated Statements of Income (Unaudited) Quarter Ended Nine Months Ended ------------------------------------------------ ------------------ September June 30, March December September September September 30, 31, 31, 30, 30, 30, (Dollars in thousands) 2019 2019 2019 2018 2018 2019 2018 --------------------------------------- -------- -------- -------- -------- -------- -------- -------- Interest Income: Interest and Fees on Loans $ 24,408 $ 23,870 $ 22,423 $ 19,778 $ 17,777 $ 70,701 $ 50,002 Interest and Dividends on Securities 1,783 1,829 1,874 1,611 1,386 5,486 4,223 Interest on Federal Funds Sold and Due 129 197 290 164 162 616 417 From Banks - ------ - ------ - ------ - ------ - ------ - ------ Total Interest Income 26,320 25,896 24,587 21,553 19,325 76,803 54,642 - ------ - ------ - ------ - ------ - ------ - ------ - ------ Interest Expense: Interest on Deposits 5,050 5,038 4,757 3,853 3,127 14,845 7,980 Interest on Borrowings 1,012 665 710 583 562 2,387 1,550 - ------ - ------ - ------ - ------ - ------ - ------ Total Interest Expense 6,062 5,703 5,467 4,436 3,689 17,232 9,530 - ------ - ------ - ------ - ------ - ------ - ------ - ------ Net Interest Income 20,258 20,193 19,120 17,117 15,636 59,571 45,112 Provision for Loan Losses 479 1,302 633 939 503 2,414 1,451 - ------ - ------ - ------ - ------ - ------ - ------ - ------ Net Interest Income After Provision for 19,779 18,891 18,487 16,178 15,133 57,157 43,661 Loan Losses Other Income: Service Charges on Deposit Accounts 1,035 1,034 938 869 695 3,007 1,941 Gain (Loss) on Sales of Securities 26 58 - 7 - 84 - Other Income 861 3,127 1,373 1,615 852 5,361 3,347 - ------ Total Other Income 1,922 4,219 2,311 2,491 1,547 8,452 5,288 - ------ - ------ - ------ - ------ - ------ - ------ - ------ Other Expenses: Salaries and Employee Benefits 8,793 8,756 8,552 7,444 7,190 26,101 20,418 Occupancy and Equipment Expense 2,135 1,884 1,894 1,523 1,522 5,913 4,342 Other Expenses 3,950 3,937 3,344 5,442 3,158 11,231 11,079 - ------ Total Other Expenses 14,878 14,577 13,790 14,409 11,870 43,245 35,839 - ------ - ------ - ------ - ------ - ------ - ------ - ------ Income Before Income Taxes 6,823 8,533 7,008 4,260 4,810 22,364 13,110 Provision for Income Taxes 1,312 1,690 1,349 815 910 4,351 2,464 - ------ - ------ - ------ - ------ - ------ - ------ - ------ Net Income $ 5,511 $ 6,843 $ 5,659 $ 3,445 $ 3,900 $ 18,013 $ 10,646 - ------ - ------ - ------ - ------ - ------ - ------ - ------

Business First Bancshares, Inc. Consolidated Net Interest Margin (Unaudited) Quarter Ended September 30, 2019 June 30, 2019 September 30, 2018 ----------------------------- ----------------------------- ----------------------------- Average Average Average Outstanding Interest Average Outstanding Interest Average Outstanding Interest Average Earned / Earned / Earned / (Dollars in Balance Interest Yield Balance Interest Yield Balance Interest Yield thousands) Paid / Rate Paid / Rate Paid / Rate ------------------- ------------- -------- ------ ------------- -------- ------ ------------- -------- ------ Assets Interest-Earning Assets Total Loans $ 1,664,283 $ 24,408 5.87 % $ 1,602,087 $ 23,870 5.96 % $ 1,258,060 $ 17,777 5.65 % Securities 297,121 1,783 2.40 % 303,232 1,829 2.41 % 253,902 1,386 2.18 % Available for Sale Interest-Bearing Deposit in Other 16,070 129 3.21 % 23,716 197 3.32 % 31,858 162 2.03 % Banks - --------- - - ------ - --------- - - ------ ---- - - --------- - - ------ ---- - Total Interest-Earning 1,977,474 26,320 5.32 % 1,929,035 25,896 5.37 % 1,543,820 19,325 5.01 % Assets Allowance for Loan (11,783 ) (11,702 ) (9,945 ) Losses Noninterest-Earning 191,068 185,359 132,242 Assets Total Assets $ 2,156,759 $ 26,320 $ 2,102,692 $ 25,896 $ 1,666,117 $ 19,325 - --------- - - ------ - --------- - - ------ - --------- - - ------ Liabilities and Shareholders’ Equity Interest-Bearing Liabilities Interest-Bearing $ 1,300,740 $ 5,050 1.55 % $ 1,335,630 $ 5,038 1.51 % $ 1,028,412 $ 3,127 1.22 % Deposits Subordinated Debt 25,000 422 6.75 % 25,000 429 6.86 % - - - Advances from Federal Home Loan 105,588 560 2.12 % 36,856 224 2.43 % 85,000 506 2.38 % Bank (“FHLB”) Other Borrowings 23,718 30 0.51 % 14,390 12 0.33 % 17,484 56 1.28 % - --------- - ---- - - --------- - ---- - - --------- - ---- - Total Interest-Bearing 1,455,046 6,062 1.67 % 1,411,876 5,703 1.62 % 1,130,896 3,689 1.31 % Liabilities - --------- - - ------ ---- - - --------- - - ------ ---- - - --------- - - ------ ---- - Noninterest-Bearing Liabilities Noninterest-Bearing 398,748 396,793 315,111 Deposits Other Liabilities 24,937 23,761 8,479 - --------- - - --------- - - --------- - Total Noninterest-Bearing 423,685 420,554 323,590 Liabilities Shareholders’ 278,028 270,262 211,631 Equity Total Liabilities and Shareholders’ $ 2,156,759 $ 2,102,692 $ 1,666,117 Equity - --------- - - --------- - - --------- - Net Interest Spread 3.66 % 3.75 % 3.70 % Net Interest Income $ 20,258 $ 20,193 $ 15,636 - ------ - ------ - ------ Net Interest Margin 4.10 % 4.19 % 4.05 % Overall Cost of 1.31 % 1.26 % 1.02 % Funds NOTE: Average outstanding balances are determined utilizing monthly averages and average yield/rate is calculated utilizing a 30/360 day count convention.

Business First Bancshares, Inc. Consolidated Net Interest Margin (Unaudited) For the Nine Months Ended September 30, ------------------------------------------------------------ 2019 2018 ----------------------------- ----------------------------- Average Average Outstanding Interest Average Outstanding Interest Average Earned / Earned / (Dollars in thousands) Balance Interest Yield Balance Interest Yield Paid / Rate Paid / Rate --------------------------------------------- ------------- -------- ------ ------------- -------- ------ Assets Interest-Earning Assets Total Loans $ 1,605,423 $ 70,701 5.87 % $ 1,216,395 $ 50,002 5.48 % Securities Available for Sale 303,374 5,486 2.41 % 254,035 4,223 2.22 % Interest-Bearing Deposit in Other Banks 26,621 616 3.09 % 32,899 417 1.69 % - --------- - - ------ ---- - - --------- - - ------ ---- - Total Interest-Earning Assets 1,935,418 76,803 5.29 % 1,503,329 54,642 4.85 % Allowance for Loan Losses (11,625 ) (9,516 ) Noninterest-Earning Assets 187,924 141,209 Total Assets $ 2,111,717 $ 76,803 $ 1,635,022 $ 54,642 - --------- - - ------ - --------- - - ------ Liabilities and Shareholders’ Equity Interest-Bearing Liabilities Interest-Bearing Deposits $ 1,323,927 $ 14,845 1.50 % $ 1,022,982 $ 7,980 1.04 % Subordinated Debt 25,000 1,267 6.76 % - - 0.00 % Advances from Federal Home Loan Bank (“FHLB”) 59,990 1,065 2.37 % 84,777 1,387 2.18 % Other Borrowings 16,863 55 0.43 % 18,478 163 1.18 % - --------- - - --------- - ---- - Total Interest-Bearing Liabilities 1,425,780 17,232 1.61 % 1,126,237 9,530 1.13 % - --------- - - ------ ---- - - --------- - - ------ ---- - Noninterest-Bearing Liabilities Noninterest-Bearing Deposits 396,452 309,526 Other Liabilities 19,105 8,604 - --------- - - --------- - Total Noninterest-Bearing Liabilities 415,557 318,130 Shareholders’ Equity 270,380 190,655 Total Liabilities and Shareholders’ Equity $ 2,111,717 $ 1,635,022 - --------- - - --------- - Net Interest Spread 3.68 % 3.72 % Net Interest Income $ 59,571 $ 45,112 - ------ - ------ Net Interest Margin 4.10 % 4.00 % Overall Cost of Funds 1.26 % 0.89 % NOTE: Average outstanding balances are determined utilizing monthly averages and average yield/rate is calculated utilizing a 30/360 day count convention.

Business First Bancshares, Inc. Non-GAAP Measures (Unaudited) September 30, June 30, March 31, December 31, September 30, (Dollars in thousands, except per 2019 2019 2019 2018 2018 share data) ---------------------------------- -------------- -------------- -------------- -------------- -------------- Tangible Common Equity Total Shareholders’ Equity $ 280,340 $ 277,469 $ 269,144 $ 260,058 $ 212,961 Adjustments: Goodwill (48,333 ) (48,503 ) (49,534 ) (49,488 ) (32,427 ) Core Deposit Intangible (6,916 ) (7,139 ) (7,655 ) (7,885 ) (4,103 ) Total Tangible Common Equity $ 225,091 $ 221,827 $ 211,955 $ 202,685 $ 176,431 - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - Tangible Assets Total Assets $ 2,220,840 $ 2,153,608 $ 2,101,400 $ 2,094,896 $ 1,678,195 Adjustments: Goodwill (48,333 ) (48,503 ) (49,534 ) (49,488 ) (32,427 ) Core Deposit Intangible (6,916 ) (7,139 ) (7,655 ) (7,885 ) (4,103 ) Total Tangible Assets $ 2,165,591 $ 2,097,966 $ 2,044,211 $ 2,037,523 $ 1,641,665 - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - Common Shares Outstanding 13,274,823 13,361,482 13,361,482 13,213,280 11,533,721 Book Value per Common Share $ 21.12 $ 20.77 $ 20.14 $ 19.68 $ 18.46 Tangible Book Value per Common $ 16.96 $ 16.60 $ 15.86 $ 15.34 $ 15.30 Share Common Equity to Total Assets 12.62 % 12.88 % 12.81 % 12.41 % 12.69 % Tangible Common Equity to Tangible 10.39 % 10.57 % 10.37 % 9.95 % 10.75 % Assets

Business First Bancshares, Inc. Non-GAAP Measures (Unaudited) Quarter Ended Nine Months Ended -------------------------------------------------------------------------- ----------------------------- September 30, June 30, March 31, December 31, September 30, September 30, September 30, (Dollars in thousands, 2019 2019 2019 2018 2018 2019 2018 except per share data) ---------------------- -------------- -------------- -------------- -------------- -------------- -------------- -------------- Core Net Income Net Income $ 5,511 $ 6,843 $ 5,659 $ 3,445 $ 3,900 $ 18,013 $ 10,646 Adjustments: (1) Noninterest Income Sale of Impaired - (91 ) - (87 ) - (91 ) - Credit Tax Impact - 19 - 18 - 19 - (Gains) Losses on Former Bank Premises 594 - - (494 ) 139 594 139 and Equipment Tax Impact (125 ) - - 104 (29 ) (125 ) (29 ) (Gains) Losses on Sale (26 ) (58 ) - (7 ) - (84 ) - of Securities Tax Impact 5 12 - 1 - 18 - (Gains) Losses on Sale 12 (593 ) - - - (581 ) - of Banking Center Tax Impact (3 ) 125 - - - 122 - Noninterest Expense Early Lease 87 - - - - 87 - Termination Penalty Tax Impact (18 ) - - - - (18 ) - Employee Share Awards - - - - - - 118 – NASDAQ Listing Tax Impact - - - - - - (25 ) Acquisition-Related 288 436 (50 ) 2,132 509 674 1,436 Expenses (2) Tax Impact (60 ) (91 ) 16 (410 ) (90 ) (135 ) (213 ) Core Net Income $ 6,265 $ 6,602 $ 5,625 $ 4,702 $ 4,429 $ 18,493 $ 12,072 - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - Average Common Shares 13,315,351 13,361,482 13,287,560 12,099,659 11,533,374 13,321,566 10,795,989 Outstanding Average Diluted Shares 13,669,370 13,740,937 13,653,125 12,521,017 11,993,734 13,675,585 11,256,349 Outstanding Earnings per Share - $ 0.41 $ 0.51 $ 0.43 $ 0.28 $ 0.34 $ 1.35 $ 0.99 Basic Earnings per Share - $ 0.40 $ 0.50 $ 0.41 $ 0.28 $ 0.33 $ 1.32 $ 0.95 Diluted Core Earnings per $ 0.47 $ 0.49 $ 0.42 $ 0.39 $ 0.38 $ 1.39 $ 1.12 Share – Basic Core Earnings per $ 0.46 $ 0.48 $ 0.41 $ 0.38 $ 0.37 $ 1.35 $ 1.07 Share – Diluted Total Quarterly/Year-to-Date $ 2,156,759 $ 2,102,692 $ 2,075,683 $ 1,827,598 $ 1,666,117 $ 2,111,717 $ 1,635,022 Average Assets Total Quarterly/Year-to-Date $ 278,028 $ 270,262 $ 262,681 $ 228,496 $ 211,631 $ 270,380 $ 190,655 Average Equity Return on Average 1.02 % 1.30 % 1.09 % 0.75 % 0.94 % 1.14 % 0.87 % Assets Return on Average 7.93 % 10.13 % 8.62 % 6.03 % 7.37 % 8.88 % 7.45 % Equity Core Return on Average 1.16 % 1.26 % 1.08 % 1.03 % 1.06 % 1.17 % 0.98 % Assets Core Return on Average 9.01 % 9.77 % 8.57 % 8.23 % 8.37 % 9.12 % 8.44 % Equity Core Efficiency Ratio Noninterest Expense 14,878 14,577 13,790 14,409 11,870 43,245 35,839 Core Adjustments (375 ) (436 ) 50 (2,132 ) (509 ) (761 ) (1,554 ) Net Interest and 22,154 24,354 21,431 19,601 17,183 67,939 50,400 Noninterest Income (3) Core Adjustments 606 (684 ) - (581 ) 139 (78 ) 139 Efficiency Ratio 67.16 % 59.85 % 64.35 % 73.51 % 69.08 % 63.65 % 71.11 % Core Efficiency Ratio 63.72 % 59.74 % 64.58 % 64.55 % 65.59 % 62.60 % 67.84 % Net Interest Income Net Interest Income $ 20,258 $ 20,193 $ 19,120 $ 17,117 $ 15,636 $ 59,571 $ 45,112 Adjustments: Loan Discount (544 ) (826 ) (432 ) (283 ) (268 ) (1,802 ) (995 ) Accretion Net Interest Income Excluding Loan $ 19,714 $ 19,367 $ 18,688 $ 16,834 $ 15,368 $ 57,769 $ 44,117 Discount Accretion - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - - ---------- - Total Average Interest-Earnings $ 1,977,474 $ 1,929,035 $ 1,904,870 $ 1,681,240 $ 1,543,820 $ 1,935,418 $ 1,503,329 Assets Net Interest Margin 4.10 % 4.19 % 4.01 % 4.07 % 4.05 % 4.10 % 4.00 % (4) Net Interest Margin Excluding Loan 3.99 % 4.02 % 3.92 % 4.01 % 3.98 % 3.98 % 3.91 % Discount Accretion (4) Net Interest Spread 3.66 % 3.75 % 3.61 % 3.70 % 3.70 % 3.68 % 3.72 % Net Interest Spread Excluding Loan 3.55 % 3.58 % 3.52 % 3.63 % 3.63 % 3.56 % 3.63 % Discount Accretion (1) Tax rates, exclusive of certain nondeductible merger-related expenses, utilized were 21% for 2019 and 2018. These rates approximated the marginal tax rates. (2) Includes merger and conversion-related expenses and salary and employee benefits. (3) Excludes gains/losses on sales of securities. (4) Calculated utilizing a 30/360 day count convention.

Misty AlbrechtBusiness First Bank225.286.7879Misty.Albrecht@b1BANK.com