FOR IMMEDIATE RELEASE
CONTACT: Kathleen Campbell
Senior Vice President, Marketing
15 S. Main Street
Mansfield, PA 16933
570-662-0422
570-662-8512 (fax)
April 16, 2004
Citizens Financial Services, Inc. Reports First Quarter Earnings increased by 9.4% over one year ago
MANSFIELD, PENNSYLVANIA—John M. Thomas, MD, interim president of Citizens Financial Services, Inc., (OTC BB: CZFS)holding company for First Citizens National Bank, has reported 2004 first-quarter earnings. Total assets for Citizens Financial Services, Inc. surpassed $468.8 million on March 31, 2004. This figure increased 4.8% over the $447.2 million at March 31, 2003. Deposits grew 1.5% to $387.1 million while total loans increased 4.3% to $317.4 million from one year ago.
Citizens Financial Services, Inc. reported net income of $1,493 million as of March 31, 2004, compared to $1,365 million of one year ago, a 9.4% increase.
Total stockholders’ equity is $39.5 million as compared to $38.9 million one year ago – a 1.7% improvement. The market value of Citizens Financial Services stock as of March 31, 2004 was $25.13, a 10.2% increase over the $22.80 reported one year ago. Likewise, cash dividends paid increased 5.6% during the first quarter of 2004 to $.19 per share versus the $.18 per share of one year ago.
Interim President John M. Thomas, MD stated, “The 9.4% increase in earnings is a result of lower interest expense as deposits continue to reprice at a lower rate in the current interest-rate environment. Also, the purchase and assumption agreement entered into with Legacy Bank to buy the community offices in Sayre and Towanda during the first quarter of 2004 is expected to contribute positively to the financial performance of the Bank during the latter part of the year. The conversion is expected to be completed in early June pending OCC approval.”
Inquiries regarding the purchase of the company’s stock may be made through the following brokers: Ferris Baker Watts, Inc. 410-659-4600: Ryan, Beck & Co., 800-395-7926; Schwab Capital Markets LP, 201-963-9100; Monroe Securities, Inc., 800-766-5560; Boenning & Scattergood Inc., 610-828-0400; Keefe, Beuyette & Woods, Inc., 212-554-2600; Knight Equity Markets, LP, 212-336-8790; GVR Co., 800-638-8602; Hill Thompson Magid & Co., 800-631-3083; Powell (EE) & Co., Inc., 412-391-4594 and Pershing Trading Company, 201-413-3531.
Citizens Financial Services, Inc., has over 1,500 shareholders, the majority of whom reside in Potter, Tioga, and Bradford Counties.
Note: This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. These factors include operating, legal and regulatory risks; changing economic and competitive conditions and other risks and uncertainties.
Financial Highlights(In thousands, except per share and ratio data.) | ||
(Unaudited) | ||
2004 | 2003 | |
Three Months Ended March 31 | ||
Net income | $ 1,493 | $ 1,365 |
Comprehensive income | 1,533 | 969 |
Per common share data: | ||
Earnings per share | 0.53 | 0.48 |
Cash dividends declared | 0.19 | 0.18 |
Performance ratios: | ||
Return on average assets | 1.29% | 1.28% |
Return on average equity | 15.72% | 15.11% |
At March 31 | ||
Assets | $ 468,831 | $ 447,201 |
Investment securities: | ||
Available-for-sale | 109,618 | 108,408 |
Loans (net of unearned income) | 317,423 | 304,342 |
Allowance for loan losses | 3,874 | 3,657 |
Deposits | 387,075 | 381,532 |
Stockholders' Equity | 39,527 | 38,866 |
Non-performing assets | 2,632 | 2,769 |
Average leverage ratio | 8.40% | 6.83% |
Per common share data: | ||
Book value | $ 14.05 | $ 13.75 |
Market value (average of bid/ask price) | 25.13 | 22.80 |
Market price to book value ratio | 178.86% | 165.82% |
March 31, 2004 |
PART I - FINANCIAL INFORMATION |
Item 1 - FINANCIAL STATEMENTS |
CITIZENS FINANCIAL SERVICES, INC. |
CONSOLIDATED BALANCE SHEET |
(UNAUDITED) |
March 31 | December 31 | March 31 | |
(in thousands) | 2004 | 2003 | 2003 |
ASSETS: | |||
Cash and due from banks: | |||
Noninterest-bearing | $ 8,731 | $ 9,624 | $ 12,264 |
Interest-bearing | 3,349 | 327 | 203 |
Total cash and cash equivalents | 12,080 | 9,951 | 12,467 |
Available-for-sale securities | 109,618 | 106,587 | 108,408 |
Loans (net of allowance for loan losses 2004, $3,874; December 31, | |||
2003, $3,620 and March 31, 2003, $3,657) | 313,549 | 314,037 | 300,685 |
Premises and equipment | 10,479 | 10,645 | 11,018 |
Accrued interest receivable | 1,790 | 1,703 | 1,978 |
Goodwill | 6,905 | 6,905 | 6,905 |
Core deposit intangible | 869 | 978 | 1,304 |
Bank owned life insurance | 7,221 | 7,142 | - |
Other assets | 6,320 | 5,930 | 4,436 |
TOTAL ASSETS | $ 468,831 | $ 463,878 | $ 447,201 |
LIABILITIES: | |||
Deposits: | |||
Noninterest-bearing | $ 44,377 | $ 46,820 | $ 41,624 |
Interest-bearing | 342,698 | 338,871 | 339,908 |
Total deposits | 387,075 | 385,691 | 381,532 |
Borrowed funds | 26,444 | 27,796 | 23,130 |
Notes payable | 7,500 | 7,500 | - |
Accrued interest payable | 1,547 | 1,888 | 1,664 |
Commitment to purchase investment securities | 4,094 | - | - |
Other liabilities | 2,644 | 2,474 | 2,009 |
TOTAL LIABILITIES | 429,304 | 425,349 | 408,335 |
STOCKHOLDERS' EQUITY: | |||
Common Stock | |||
$1.00 par value; authorized 10,000,000 shares; | |||
issued 2,909,849 shares in 2004 and at December 31, 2003, | |||
and 2,882,070 shares at March 31, 2003, respectively | 2,910 | 2,910 | 2,882 |
Additional paid-in capital | 10,213 | 10,213 | 9,474 |
Retained earnings | 27,413 | 26,455 | 25,302 |
TOTAL | 40,536 | 39,578 | 37,658 |
Accumulated other comprehensive income | 996 | 956 | 2,157 |
Less: Treasury Stock, at cost | |||
55,162 shares in 2003 and 2002 | (2,005) | (2,005) | (949) |
TOTAL STOCKHOLDERS' EQUITY | 39,527 | 38,529 | 38,866 |
TOTAL LIABILITIES AND | |||
STOCKHOLDERS' EQUITY | $ 468,831 | $ 463,878 | $ 477,201 |
CITIZENS FINANCIAL SERVICES, INC. | ||
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) | ||
Three Months Ended | ||
(in thousands, except per share data) | March 31 | |
2004 | 2003 | |
INTEREST INCOME: | ||
Interest and fees on loans | $ 5,348 | $ 5,403 |
Interest-bearing deposits with banks | 5 | 4 |
Investment securities: | ||
Taxable | 892 | 894 |
Nontaxable | 85 | 137 |
Dividends | 62 | 82 |
TOTAL INTEREST INCOME | 6,392 | 6,520 |
INTEREST EXPENSE: | ||
Deposits | 1,964 | 2,238 |
Borrowed funds | 213 | 75 |
TOTAL INTEREST EXPENSE | 2,177 | 2,313 |
NET INTEREST INCOME | 4,215 | 4,207 |
Provision for loan losses | - | 135 |
NET INTEREST INCOME AFTER | ||
PROVISION FOR LOAN LOSSES | 4,215 | 4,072 |
NON-INTEREST INCOME: | ||
Service charges | 731 | 711 |
Trust | 181 | 124 |
Gains on Loans Sold | 9 | 96 |
Realized securities gains, net | 287 | 259 |
Bank Owned Life Insurance | 79 | - |
Other | 109 | 164 |
TOTAL NON-INTEREST INCOME | 1,396 | 1,354 |
NON-INTEREST EXPENSES: | ||
Salaries and employee benefits | 1,925 | 1,897 |
Occupancy | 286 | 278 |
Furniture and equipment | 169 | 177 |
Professional fees | 154 | 162 |
Amortization | 109 | 109 |
Other | 1,028 | 1,008 |
TOTAL NON-INTEREST EXPENSES | 3,671 | 3,631 |
Income before provision for income taxes | 1,940 | 1,795 |
Provision for income taxes | 447 | 430 |
NET INCOME | $ 1,493 | $ 1,365 |
OPERATING CASH EARNINGS** | $ 1,564 | $ 1,436 |
Earnings Per Share | $ 0.53 | $ 0.48 |
Operating Cash Earnings Per Share** | $ 0.56 | $ 0.50 |
Cash Dividend Declared | $ 0.190 | $ 0.180 |
**Operating cash earnings are net income before amortization of intangible assets and merger and acquisition costs, net of tax. | ||
Weighted average number shares outstanding | 2,812,888 | 2,854,688 |