EXHIBIT 99.1
For more information, contact: |
Kevin Eichner (314) 725 5500 |
Frank Sanfilippo (314) 725 5500 |
Katie Hollar (816) 221 7500 |
ENTERPRISE FINANCIAL THIRD QUARTER EARNINGS PER SHARE
INCREASES 55.6% OVER PREVIOUS YEAR
St. Louis, October 19, 2004 – Enterprise Financial Services Corp (OTCBB: EFSC), the parent company of Enterprise Bank and Trust, reported a 55.6% increase in third quarter fully diluted earnings per share in comparison to the same quarter in 2003. Third quarter net income was $2.9 million or $0.28 per fully diluted share. Third quarter 2003 earnings were $1.8 million or $0.18 per fully diluted share.
For the nine months ended September 30, 2004, net income was $6.4 million or $0.63 per fully diluted share. For the comparable period in 2003, net income was $5.5 million or $0.56 per fully diluted share including an after tax gain from the sale of three Southeast Kansas branches which contributed $1.6 million or $0.16 per fully diluted share.
Portfolio loans at quarter end totaled $874 million. For the twelve month period ending September 30, 2004, portfolio loans grew by $129 million or 17.3%. Deposits increased $179 million or 23.6% during the same period. Loans grew by $90 million or 11.5% since December 31, 2003. The 2004 year to date loan growth was funded by a $141 million increase in deposits or 17.6% for the same period.
Net interest income increased $2.3 million or 9.4% for the first nine months of 2004 compared to the same period in 2003. The net interest rate margin through September decreased slightly from 4.06% to 3.84% primarily due to a decrease in overall loan yields.
“The Company has achieved excellent earnings momentum. This was the best quarter in the history of our Company, and we are well on the way to another record year overall. Growth in earnings per share remains our top priority while we increase our market share in both of our core lines of business,” said Kevin Eichner, president and CEO of Enterprise Financial.
The Company’s Wealth Management business segment reported total revenue growth of $549,000 or 22.2% for the first nine months of 2004 versus 2003. Total revenue for the
first nine months of 2004 was $3.0 million versus $2.5 million in 2003 Assets under administration in Enterprise Trust were $1.24 billion at September 30, 2004 versus $1.04 billion at September 30, 2003, a 19.7% increase.
Provision for loan losses in the banking segment was $1.4 million for the nine months ended September 30, 2004 compared to $2.7 million for the same period in 2003. This decline is due to stable and strong non-performing loan levels, strengthening local economies and favorable delinquency trends. The allowance for loan losses of $11.4 million at September 30, 2004 represents 1.31% of outstanding portfolio loans compared to 1.35% at December 31, 2003.
“While we are now well positioned as a growth company in the industry, we are equally gratified by the quality of our loan portfolio. This continues to be one of the hallmarks of our business,” said Eichner.
Enterprise Financial operates commercial banking and wealth management businesses in metropolitan St. Louis and Kansas City, with a primary focus on serving the needs of privately held businesses, their owners and other success-minded individuals.
Please refer to Enterprise Financial’s consolidated balance sheets as of September 30, 2004 and December 31, 2003 and consolidated statements of operations for the three and nine months ended September 30, 2004 and 2003 attached for more details.
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Readers should note that in addition to the historical information contained herein, this press release may contain forward-looking statements which are inherently subject to risks and uncertainties that could cause actual results to differ materially from those contemplated from such statements. Factors that could cause or contribute to such differences include, but are not limited to, burdens imposed by federal and state regulations of banks, credit risk, exposure to local economic conditions, risks associated with rapid increase or decrease in prevailing interest rates and competition from banks and other financial institutions, as well as those in Enterprise Financial’s 2003 Annual Report on Form 10-K.
ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Balance Sheets (unaudited)
September 30, 2004 and December 31, 2003
(Dollars in thousands, except share data)
September 30, 2004 | December 31, 2003 | ||||||
Assets | |||||||
Cash and due from banks | $ | 29,316 | $ | 26,271 | |||
Federal funds sold | 38,712 | — | |||||
Interest-bearing deposits | 142 | 217 | |||||
Investments in debt and equity securities: | |||||||
Available for sale, at estimated fair value | 92,998 | 83,939 | |||||
Held to maturity, at amortized cost (estimated fair value of $8 at September 30, 2004 and $10 at December 31, 2003) | 8 | 10 | |||||
Total investments in debt and equity securities | 93,006 | 83,949 | |||||
Loans held for sale | 1,599 | 2,848 | |||||
Loans, less unearned loan fees | 874,092 | 783,878 | |||||
Less allowance for loan losses | 11,441 | 10,590 | |||||
Loans, net | 862,651 | 773,288 | |||||
Other real estate owned | 273 | — | |||||
Fixed assets, net | 7,071 | 7,318 | |||||
Accrued interest receivable | 3,915 | 3,279 | |||||
Goodwill | 1,938 | 1,938 | |||||
Prepaid expenses and other assets | 7,767 | 8,618 | |||||
Total assets | $ | 1,046,390 | $ | 907,726 | |||
Liabilities and Shareholders’ Equity | |||||||
Deposits: | |||||||
Demand | $ | 184,426 | $ | 164,952 | |||
Interest-bearing transaction accounts | 77,952 | 58,926 | |||||
Money market accounts | 434,678 | 371,583 | |||||
Savings | 3,992 | 4,123 | |||||
Certificates of deposit: | |||||||
$100,000 and over | 190,554 | 154,142 | |||||
Other | 45,333 | 42,674 | |||||
Total deposits | 936,935 | 796,400 | |||||
Subordinated debentures | 20,619 | 15,464 | |||||
Federal Home Loan Bank advances | 11,413 | 14,500 | |||||
Notes payable and other borrowings | 430 | 9,647 | |||||
Accrued interest payable | 1,331 | 1,150 | |||||
Accounts payable and accrued expenses | 4,616 | 5,177 | |||||
Total liabilities | 975,344 | 842,338 | |||||
Shareholders’ equity: | |||||||
Common stock, $.01 par value; authorized 20,000,000 shares; issued and outstanding 9,731,990 shares at September 30, 2004 and 9,618,482 shares at December 31, 2003 | 97 | 96 | |||||
Additional paid-in capital | 40,653 | 39,841 | |||||
Retained earnings | 30,472 | 24,832 | |||||
Accumulated other comprehensive (loss) income | (176 | ) | 619 | ||||
Total shareholders’ equity | 71,046 | 65,388 | |||||
Total liabilities and shareholders’ equity | $ | 1,046,390 | $ | 907,726 | |||
ENTERPRISE FINANCIAL SERVICES CORP AND SUBSIDIARIES
Consolidated Statements of Operations (unaudited)
(Dollars in thousands, except share data)
Three months ended September 30, | Nine months ended September 30, | |||||||||||
2004 | 2003 | 2004 | 2003 | |||||||||
Interest income: | ||||||||||||
Interest and fees on loans | $ | 11,788 | $ | 10,298 | $ | 33,304 | $ | 30,971 | ||||
Interest on debt and equity securities: | ||||||||||||
Taxable | 584 | 364 | 1,561 | 1,252 | ||||||||
Nontaxable | 10 | 9 | 31 | 13 | ||||||||
Interest on federal funds sold | 138 | 26 | 224 | 114 | ||||||||
Dividends on equity securities | 30 | 20 | 75 | 54 | ||||||||
Total interest income | 12,550 | 10,717 | 35,195 | 32,404 | ||||||||
Interest expense: | ||||||||||||
Interest-bearing transaction accounts | 97 | 34 | 194 | 136 | ||||||||
Money market accounts | 1,192 | 776 | 2,955 | 2,588 | ||||||||
Savings | 3 | 3 | 9 | 21 | ||||||||
Certificates of deposit: | ||||||||||||
$100,000 and over | 1,058 | 763 | 2,894 | 2,172 | ||||||||
Other | 259 | 326 | 778 | 1,267 | ||||||||
Subordinated debentures | 374 | 307 | 1,036 | 924 | ||||||||
Federal Home Loan Bank borrowings | 173 | 247 | 593 | 849 | ||||||||
Notes payable and other borrowings | 1 | 6 | 30 | 35 | ||||||||
Total interest expense | 3,157 | 2,462 | 8,489 | 7,992 | ||||||||
Net interest income | 9,393 | 8,255 | 26,706 | 24,412 | ||||||||
Provision for loan losses | 100 | 635 | 1,437 | 2,728 | ||||||||
Net interest income after provision for loan losses | 9,293 | 7,620 | 25,269 | 21,684 | ||||||||
Noninterest income: | ||||||||||||
Service charges on deposit accounts | 532 | 455 | 1,529 | 1,347 | ||||||||
Wealth Management income | 1,119 | 1,214 | 3,023 | 2,474 | ||||||||
Other service charges and fee income | 92 | 92 | 277 | 280 | ||||||||
Gain on sale of branches | — | — | — | 2,938 | ||||||||
Gain on sale of mortgage loans | 9 | 302 | 219 | 831 | ||||||||
Gain on sale of securities | 126 | — | 127 | 78 | ||||||||
Total noninterest income | 1,878 | 2,063 | 5,175 | 7,948 | ||||||||
Noninterest expense: | ||||||||||||
Compensation | 3,962 | 3,913 | 11,748 | 11,218 | ||||||||
Payroll taxes and employee benefits | 612 | 597 | 2,100 | 1,858 | ||||||||
Occupancy | 523 | 496 | 1,540 | 1,471 | ||||||||
Furniture and equipment | 176 | 189 | 534 | 644 | ||||||||
Data processing | 208 | 218 | 586 | 730 | ||||||||
Other | 1,575 | 1,508 | 4,547 | 5,026 | ||||||||
Total noninterest expense | 7,056 | 6,921 | 21,055 | 20,947 | ||||||||
Income before income tax expense | 4,115 | 2,762 | 9,389 | 8,685 | ||||||||
Income tax expense | 1,261 | 1,005 | 3,022 | 3,195 | ||||||||
Net income | $ | 2,854 | $ | 1,757 | $ | 6,367 | $ | 5,490 | ||||
Per share amounts | ||||||||||||
Basic earnings per share | $ | 0.29 | $ | 0.18 | $ | 0.66 | $ | 0.57 | ||||
Basic weighted average common shares outstanding | 9,723,695 | 9,580,091 | 9,681,437 | 9,554,540 | ||||||||
Diluted earnings per share | $ | 0.28 | $ | 0.18 | $ | 0.63 | $ | 0.56 | ||||
Diluted weighted average common shares outstanding | 10,074,329 | 9,880,404 | 10,005,663 | 9,861,025 |