EXHIBIT 99
Contact Info: Mary Ellen Fitzpatrick (978) 656-5520
Senior Vice President, Corporate Communications
Enterprise Bancorp, Inc. Announces 2007 Second Quarter Financial Results and Quarterly Dividend
LOWELL, Mass—(BUSINESS WIRE)—Jul. 17, 2007—Enterprise Bancorp, Inc. (the “company”) (NASDAQ:EBTC) announced net income of $2.318 million for the quarter ended June 30, 2007 compared to $2.182 million during the quarter ended June 30, 2006, an increase of 6%. Diluted earnings per share were $0.29 for the second quarter compared to $0.28 for the same period in 2006, an increase of 4%.
Net income for the six months ended June 30, 2007 amounted to $4.540 million compared to $4.238 million for the same period in 2006, an increase of 7%. Diluted earnings per share were $0.58 for the six months ended June 30, 2007 compared to $0.54 for the same period in 2006, an increase of 7%.
The company also announced a quarterly dividend of $0.08 to be paid on September 4, 2007 to shareholders of record as of August 14, 2007. The quarterly dividend represents a 14% increase over the 2006 dividend rate.
Year-to-date net income growth resulted primarily from an increase in non-interest income and a decrease in the provision for loan losses, partially offset by an increase in non-interest expense and a decrease in net interest income.
Net interest income for the six months ended June 30, 2007 amounted to $20.1 million compared to $20.5 million for the same period in 2006, a decrease of 2%. Net interest margin, the spread earned between interest-earning assets and the company’s funding sources, primarily deposits, was 4.55% for the six months ended June 30, 2007, compared to 4.81% for the same period in 2006. Net interest margin for the quarter ended June 30, 2007 was 4.51% compared to 4.59% and 4.83% for the quarters ended March 31, 2007 and June 30, 2006, respectively. The decrease in margin resulted from both the flat yield curve and a highly-competitive marketplace.
Non-interest income was $4.6 million for the six months ended June 30, 2007, an increase of $1.3 million or 40% over the same period in 2006. The growth resulted primarily from an increase of $487 thousand in gains on security sales, which occurred mainly in the second quarter, and from increases of $329 thousand in investment advisory fees, $214 thousand in bank-owned life insurance income and $200 thousand in deposit-service fees.
Non-interest expense amounted to $17.5 million for the six months ended June 30, 2007 compared to $16.5 million for the same period in 2006, an increase of 6%. The increases were predominantly in occupancy and compensation-related costs which support the company’s growth.
The provision for loan losses, which is impacted by asset quality and loan growth, amounted to $135 thousand for the six months ended June 30, 2007 compared to $517 thousand for the same period in 2006, a decrease of $382 thousand. The reduced provision reflects continued favorable asset quality. The allowance for loan losses to total loans ratio was 1.65% at June 30, 2007 compared to 1.70% at December 31, 2006.
Key Financial Highlights
· Total assets were $1.044 billion at June 30, 2007 as compared to $979.3 million at December 31, 2006, an increase of 7%.
· Total loans increased 4% since December 31, 2006, amounting to $794.6 million at June 30, 2007.
· Total deposits, excluding brokered deposits, were $818.8 million at June 30, 2007 and $802.6 million at December 31, 2006, an increase of 2%. Brokered deposits amounted to $120.1 million and $64.9 million on those respective dates.
· Investment assets under management increased to $528.3 million at June 30, 2007 compared to $502.1 million at December 31, 2006, an increase of 5%.
· Total assets under management amounted to $1.592 billion at June 30, 2007 as compared to $1.503 billion at December 31, 2006, an increase of 6%.
George L. Duncan, Chairman of Enterprise Bancorp, Inc. summarized the June 30, 2007 results by stating, “The flat rate environment and highly-competitive marketplace continue to negatively impact margins and challenge earnings growth across the banking industry in 2007. In light of this challenging environment, we are very pleased to report year to date 2007 net income growth of 7%. Furthermore, it is gratifying to report that our growth exceeded the $1 billion in assets milestone for the first time. We view this as a significant achievement and one that positions us well for the future.”
John P. Clancy, Jr., Chief Executive Officer, added, “We remain focused on investing in our future and maintaining our commitment to a long-term strategy of geographic expansion and commercial banking growth, delivered by a highly-skilled management team and a well-trained, service-orientated employee base.”
Enterprise Bancorp, Inc. is a Massachusetts corporation that conducts substantially all of its operations through Enterprise Bank and Trust Company, commonly referred to as Enterprise Bank. The company principally is engaged in the business of attracting deposits from the general public and investing in commercial loans and investment securities. Through the bank and its subsidiaries, the company offers a range of commercial and consumer loan and deposit products as well as investment management, trust and insurance services. The company’s headquarters and the bank’s main office are located at 222 Merrimack Street in Lowell, Massachusetts. The company’s primary market area is the Merrimack Valley, North Central region of Massachusetts and South Central New Hampshire. The company has fourteen full-service branch banking offices located in the Massachusetts cities and towns of Lowell, Andover, Billerica, Chelmsford, Dracut, Fitchburg, Leominster, Tewksbury, and Westford, and in Salem, New Hampshire, which serve those cities and towns as well as the surrounding communities. The Company plans to open a new branch facility in the city of Methuen, Massachusetts in early 2008.
The above text contains statements about future events that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of the words “believe,” “expect,” “anticipate,” “intend,” “estimate,” “assume,” “will,” “should,” and other expressions that predict or indicate future events or trends and which do not relate to historical matters. Forward-looking statements should not be relied on, because they involve known and unknown risks, uncertainties and other factors, some of which are beyond the control of the company. These risks, uncertainties and other factors may cause the actual results, performance and achievements of the company to be materially different from the anticipated future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause such differences include, but are not limited to general economic conditions, changes in interest rates, regulatory considerations and competition. For more information about these factors, please see our most recent Annual Report on Form 10-K on file with the SEC, including the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Any forward-looking statements contained in this press release are made as of the date hereof, and we undertake no duty, and specifically disclaim any duty, to update or revise any such statements, whether as a result of new information, future events or otherwise.
ENTERPRISE BANCORP, INC.
Consolidated Statements of Income
Three and six months ended June 30, 2007 and 2006
(unaudited)
|
| Three Months Ended June 30, |
| Six Months Ended June 30, |
| ||||||||
(Dollars in thousands, except per share data) |
| 2007 |
| 2006 |
| 2007 |
| 2006 |
| ||||
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Interest and dividend income: |
|
|
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|
|
|
|
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| ||||
Loans |
| $ | 14,571 |
| $ | 13,329 |
| $ | 28,840 |
| $ | 25,811 |
|
Investment securities |
| 1,367 |
| 1,482 |
| 2,688 |
| 3,048 |
| ||||
Short-term investments |
| 35 |
| 67 |
| 66 |
| 160 |
| ||||
Total interest and dividend income |
| 15,973 |
| 14,878 |
| 31,594 |
| 29,019 |
| ||||
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|
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Interest expense: |
|
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|
|
|
|
|
|
| ||||
Deposits |
| 5,447 |
| 3,984 |
| 10,505 |
| 7,299 |
| ||||
Borrowed funds |
| 173 |
| 190 |
| 406 |
| 631 |
| ||||
Junior subordinated debentures |
| 295 |
| 295 |
| 589 |
| 589 |
| ||||
Total interest expense |
| 5,915 |
| 4,469 |
| 11,500 |
| 8,519 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Net interest income |
| 10,058 |
| 10,409 |
| 20,094 |
| 20,500 |
| ||||
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|
|
|
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Provision for loan losses |
| 52 |
| 244 |
| 135 |
| 517 |
| ||||
|
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|
|
| ||||
Net interest income after provision for loan losses |
| 10,006 |
| 10,165 |
| 19,959 |
| 19,983 |
| ||||
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Non-interest income: |
|
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|
|
|
|
| ||||
Investment advisory fees |
| 817 |
| 637 |
| 1,595 |
| 1,266 |
| ||||
Deposit service fees |
| 523 |
| 412 |
| 1,027 |
| 827 |
| ||||
Bank-owned life insurance |
| 148 |
| 41 |
| 296 |
| 82 |
| ||||
Net gains/(losses) on sales of investment securities |
| 425 |
| (39 | ) | 478 |
| (9 | ) | ||||
Gains on sales of loans |
| 59 |
| 34 |
| 99 |
| 78 |
| ||||
Other income |
| 543 |
| 505 |
| 1,098 |
| 1,027 |
| ||||
Total non-interest income |
| 2,515 |
| 1,590 |
| 4,593 |
| 3,271 |
| ||||
|
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Non-interest expense: |
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|
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| ||||
Salaries and employee benefits |
| 5,307 |
| 5,007 |
| 10,642 |
| 10,129 |
| ||||
Occupancy expenses |
| 1,735 |
| 1,511 |
| 3,353 |
| 2,935 |
| ||||
Audit, legal and other professional fees |
| 496 |
| 303 |
| 792 |
| 625 |
| ||||
Advertising and public relations |
| 295 |
| 384 |
| 557 |
| 629 |
| ||||
Supplies and postage |
| 249 |
| 176 |
| 482 |
| 401 |
| ||||
Investment advisory and custodial expenses |
| 129 |
| 116 |
| 252 |
| 234 |
| ||||
Other operating expenses |
| 753 |
| 759 |
| 1,406 |
| 1,521 |
| ||||
Total non-interest expense |
| 8,964 |
| 8,256 |
| 17,484 |
| 16,474 |
| ||||
|
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|
|
|
|
|
| ||||
Income before income taxes |
| 3,557 |
| 3,499 |
| 7,068 |
| 6,780 |
| ||||
Income tax expense |
| 1,239 |
| 1,317 |
| 2,528 |
| 2,542 |
| ||||
|
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|
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|
|
|
|
|
| ||||
Net income |
| $ | 2,318 |
| $ | 2,182 |
| $ | 4,540 |
| $ | 4,238 |
|
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Basic earnings per share |
| $ | 0.30 |
| $ | 0.29 |
| $ | 0.58 |
| $ | 0.56 |
|
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Diluted earnings per share |
| $ | 0.29 |
| $ | 0.28 |
| $ | 0.58 |
| $ | 0.54 |
|
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Basic weighted average common shares outstanding |
| 7,797,414 |
| 7,637,860 |
| 7,772,836 |
| 7,620,871 |
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Diluted weighted average common shares outstanding |
| 7,897,422 |
| 7,797,892 |
| 7,888,515 |
| 7,796,826 |
|
3
ENTERPRISE BANCORP, INC.
Consolidated Balance Sheets
(unaudited)
|
| June 30, |
| December 31, |
| June 30, |
| |||
(Dollars in thousands) |
| 2007 |
| 2006 |
| 2006 |
| |||
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Assets |
|
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Cash and cash equivalents: |
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| |||
Cash and due from banks |
| $ | 44,081 |
| $ | 35,583 |
| $ | 36,154 |
|
Short-term investments |
| 29,388 |
| 15,304 |
| 32,638 |
| |||
Total cash and cash equivalents |
| 73,469 |
| 50,887 |
| 68,792 |
| |||
|
|
|
|
|
|
|
| |||
Investment securities at fair value |
| 137,449 |
| 131,540 |
| 145,507 |
| |||
Loans, less allowance for loan losses of $13,117 at June 30, 2007, $12,940 at December 31, 2006, and $12,486 at June 30, 2006 |
| 781,528 |
| 748,173 |
| 720,280 |
| |||
Premises and equipment |
| 15,707 |
| 16,015 |
| 12,985 |
| |||
Accrued interest receivable |
| 5,590 |
| 5,464 |
| 5,131 |
| |||
Deferred income taxes, net |
| 7,119 |
| 6,861 |
| 6,937 |
| |||
Bank-owned life insurance |
| 12,483 |
| 12,212 |
| 13,829 |
| |||
Prepaid expenses and other assets |
| 5,021 |
| 1,976 |
| 2,315 |
| |||
Income taxes receivable |
| — |
| — |
| 811 |
| |||
Core deposit intangible, net of amortization |
| 409 |
| 475 |
| 542 |
| |||
Goodwill |
| 5,656 |
| 5,656 |
| 5,656 |
| |||
|
|
|
|
|
|
|
| |||
Total assets |
| $ | 1,044,431 |
| $ | 979,259 |
| $ | 982,785 |
|
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| |||
Liabilities and Stockholders’ Equity |
|
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| |||
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Liabilities |
|
|
|
|
|
|
| |||
Deposits |
| $ | 938,881 |
| $ | 867,522 |
| $ | 890,479 |
|
Borrowed funds |
| 5,413 |
| 15,105 |
| 4,044 |
| |||
Junior subordinated debentures |
| 10,825 |
| 10,825 |
| 10,825 |
| |||
Accrued expenses and other liabilities |
| 4,791 |
| 6,567 |
| 4,786 |
| |||
Income taxes payable |
| 100 |
| 92 |
| — |
| |||
Accrued interest payable |
| 3,101 |
| 2,105 |
| 1,842 |
| |||
|
|
|
|
|
|
|
| |||
Total liabilities |
| 963,111 |
| 902,216 |
| 911,976 |
| |||
|
|
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| |||
Commitments and Contingencies |
|
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| |||
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Stockholders’ Equity |
|
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| |||
Preferred stock, $0.01 par value per share; 1,000,000 shares authorized; no shares issued |
| — |
| — |
| — |
| |||
|
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|
|
|
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|
| |||
Common stock $0.01 par value per share; 20,000,000 shares authorized; 7,839,424, 7,722,288 and 7,685,030 shares issued and outstanding at June 30, 2007, December 31, 2006 and June 30, 2006, respectively |
| 78 |
| 77 |
| 77 |
| |||
Additional paid-in capital |
| 27,101 |
| 25,806 |
| 25,128 |
| |||
Retained earnings |
| 54,425 |
| 51,127 |
| 47,206 |
| |||
Accumulated other comprehensive (loss) / income |
| (284 | ) | 33 |
| (1,602 | ) | |||
|
|
|
|
|
|
|
| |||
Total stockholders’ equity |
| 81,320 |
| 77,043 |
| 70,809 |
| |||
|
|
|
|
|
|
|
| |||
Total liabilities and stockholders’ equity |
| $ | 1,044,431 |
| $ | 979,259 |
| $ | 982,785 |
|
4
ENTERPRISE BANCORP, INC.
Selected Consolidated Financial Data and Ratios
(unaudited)
|
| At or for the |
| At or for the |
| At or for the |
| |||
|
| six months |
| year |
| six months |
| |||
|
| ended |
| ended |
| ended |
| |||
|
| June 30, |
| December 31, |
| June 30, |
| |||
(Dollars in thousands, except per share data) |
| 2007 |
| 2006 |
| 2006 |
| |||
Balance Sheet Items: |
|
|
|
|
|
|
| |||
Total assets |
| $ | 1,044,431 |
| $ | 979,259 |
| $ | 982,785 |
|
Loans serviced for others |
| 19,738 |
| 21,659 |
| 22,608 |
| |||
Investment assets under management |
| 528,284 |
| 502,059 |
| 440,861 |
| |||
Total assets under management |
| $ | 1,592,453 |
| $ | 1,502,977 |
| $ | 1,446,254 |
|
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|
|
|
|
|
|
| |||
Book value per share |
| $ | 10.37 |
| $ | 9.98 |
| $ | 9.21 |
|
Dividends per common share |
| $ | 0.16 |
| $ | 0.28 |
| $ | 0.14 |
|
Total capital to risk weighted assets |
| 11.28 | % | 11.37 | % | 11.03 | % | |||
Tier 1 capital to risk weighted assets |
| 9.97 | % | 10.08 | % | 9.76 | % | |||
Tier 1 capital to average assets |
| 8.81 | % | 8.47 | % | 8.26 | % | |||
Allowance for loan losses to total loans |
| 1.65 | % | 1.70 | % | 1.70 | % | |||
Non-performing loans to total loans |
| 0.38 | % | 0.24 | % | 0.27 | % | |||
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Income Statement Items (annualized): |
|
|
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|
|
| |||
Return on average assets |
| 0.94 | % | 0.98 | % | 0.92 | % | |||
Return on average stockholders’ equity |
| 11.55 | % | 12.89 | % | 12.31 | % | |||
Net interest margin (tax equivalent) |
| 4.55 | % | 4.78 | % | 4.81 | % |
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