Exhibit 99
NEWS RELEASE
TO BUSINESS EDITOR
DIMECO, INC. ANNOUNCES 2012 FIRST QUARTER EARNINGS
Honesdale, PA, April 20, 2012/ Dimeco, Inc. (Nasdaq DIMC), parent company of The Dime Bank, reported first quarter 2012 earnings of $1,569,000, an increase of 23.5% over $1,270,000 reported for the first quarter 2011. A key component of this gain was net interest income, which grew 11.9%. The higher income produced earnings per share of $.98 for the first quarter 2012, representing an increase of 24.1% over the same quarter 2011. This level of net income provided a return on average stockholders’ equity of 11.21%, and a return on average assets of 1.09%, for the first quarter of 2012, an uptick of 12.9% and 16.0%, respectively, over the first quarter 2011. Payment of a $.36 per share cash dividend produced a yield of 3.95%.
The Company ended the first quarter 2012 with total assets of $582,946,000, a 7.3% or $39,615,000 gain from March 31, 2011. This growth was primarily centered in loans with an increase of $31,884,000 or 7.5% over the prior year. Deposits ended the quarter at $475,765,000, an increase of $25,198,000, or 5.6% from first quarter 2011, while stockholders’ equity increased 9.0% to $56,128,000 at March 31, 2011.
The allowance for loan loss represented 1.94% of total loans at March 31, 2012 and was 55.34% of nonaccrual loans at that date. The ratio of net charge-offs to average loans was .03% for the first quarter of 2012, a decline of 88.0% from one year earlier.
Gary C. Beilman, president and chief executive officer, commented “Our performance for the first quarter is significantly better than last year. Deposits, loans, and total assets have all increased handsomely. For us, these increases are indications that the products and services we offer are valued by our customers. We continue to address asset quality issues and have greatly enhanced our loan monitoring and collection activities, directed toward reducing loan delinquencies and troubled credits as quickly as possible. It is hoped that as this year progresses, we will be able to continue to make positive reports. We thank our customers, staff, community and shareholders for their continued investment and loyalty.”
The Dime Bank, a wholly owned subsidiary of Dimeco, Inc., serves Wayne and Pike counties in Pennsylvania and Sullivan County, New York. The Bank offers a full array of financial services ranging from traditional products to electronic banking and wealth management services. For more information on The Dime Bank, visit www.thedimebank.com.
Source: Dimeco, Inc. April 20, 2012/ Contact: Deborah L. Unflat
DIMECO, INC.
CONSOLIDATED STATEMENT OF INCOME (unaudited)
| (in thousands, except per share) | | For the three months ended March 31, | |
| | | 2012 | | | 2011 | |
| Interest Income | | | | | | | | |
| Interest and fees on loans | | $ | 5,697 | | | $ | 5,445 | |
| Investment securities: | | | | | | | | |
| Taxable | | | 324 | | | | 290 | |
| Exempt from federal income tax | | | 315 | | | | 290 | |
| Other | | | 2 | | | | 4 | |
| Total interest income | | | 6,338 | | | | 6,029 | |
| | | | | | | | | |
| Interest Expense | | | | | | | | |
| Deposits | | | 933 | | | | 1,139 | |
| Short-term borrowings | | | 19 | | | | 23 | |
| Other borrowed funds | | | 186 | | | | 219 | |
| Total interest expense | | | 1,138 | | | | 1,381 | |
| | | | | | | | | |
| Net Interest Income | | | 5,200 | | | | 4,648 | |
| | | | | | | | | |
| Provision for loan losses | | | 650 | | | | 425 | |
| | | | | | | | | |
| Net Interest Income After Provision for Loan Losses | | | 4,550 | | | | 4,223 | |
| | | | | | | | | |
| Noninterest Income | | | | | | | | |
| Service charges on deposit accounts | | | 235 | | | | 271 | |
| Mortgage loans held for sale gains, net | | | 139 | | | | 82 | |
| Investment securities gains (losses), net | | | 69 | | | | (2 | ) |
| Brokerage commissions | | | 147 | | | | 181 | |
| Earnings on bank-owned life insurance | | | 107 | | | | 106 | |
| Debit card fees | | | 149 | | | | 137 | |
| Other income | | | 171 | | | | 179 | |
| Total noninterest income | | | 1,017 | | | | 954 | |
| | | | | | | | | |
| Noninterest Expense | | | | | | | | |
| Salaries and employee benefits | | | 1,927 | | | | 1,777 | |
| Occupancy expense, net | | | 298 | | | | 306 | |
| Furniture and equipment expense | | | 91 | | | | 105 | |
| Professional fees | | | 165 | | | | 310 | |
| Data processing expense | | | 163 | | | | 179 | |
| Other expense | | | 908 | | | | 920 | |
| Total noninterest expense | | | 3,552 | | | | 3,597 | |
| | | | | | | | | |
| Income before income taxes | | | 2,015 | | | | 1,580 | |
| Income taxes | | | 446 | | | | 310 | |
| | | | | | | | | |
| NET INCOME | | $ | 1,569 | | | $ | 1,270 | |
| | | | | | | | | |
| Earnings per Share - basic | | $ | 0.98 | | | $ | 0.79 | |
| Earnings per Share - diluted | | $ | 0.98 | | | $ | 0.79 | |
| | | | | | | | | |
| Average shares outstanding - basic | | | 1,599,646 | | | | 1,598,218 | |
| Average shares outstanding - diluted | | | 1,599,974 | | | | 1,600,252 | |
DIMECO, INC.
CONSOLIDATED BALANCE SHEET (unaudited)
| (in thousands) | | | | | | |
| March 31, | | 2012 | | | 2011 | |
| Assets | | | | | | | | |
| Cash and due from banks | | $ | 5,168 | | | $ | 4,680 | |
| Interest-bearing deposits in other banks | | | 5,908 | | | | 2,660 | |
| Total cash and cash equivalents | | | 11,076 | | | | 7,340 | |
| | | | | | | | | |
| Mortgage loans held for sale | | | 1,714 | | | | 92 | |
| Investment securities available for sale | | | 87,497 | | | | 82,977 | |
| | | | | | | | | |
| Loans (net of unearned income of $2 and $16) | | | 454,352 | | | | 422,468 | |
| Less allowance for loan losses | | | 8,818 | | | | 7,115 | |
| Net loans | | | 445,534 | | | | 415,353 | |
| | | | | | | | | |
| Premises and equipment | | | 9,879 | | | | 10,403 | |
| Accrued interest receivable | | | 1,839 | | | | 1,940 | |
| Bank-owned life insurance | | | 10,150 | | | | 9,778 | |
| Other real estate owned | | | 2,747 | | | | 3,995 | |
| Other assets | | | 12,510 | | | | 11,453 | |
| | | | | | | | | |
| TOTAL ASSETS | | $ | 582,946 | | | $ | 543,331 | |
| | | | | | | | | |
| Liabilities | | | | | | | | |
| Deposits : | | | | | | | | |
| Noninterest-bearing | | $ | 51,024 | | | $ | 50,126 | |
| Interest-bearing | | | 424,741 | | | | 400,441 | |
| Total deposits | | | 475,765 | | | | 450,567 | |
| | | | | | | | | |
| Short-term borrowings | | | 28,205 | | | | 17,908 | |
| Other borrowed funds | | | 17,121 | | | | 19,077 | |
| Accrued interest payable | | | 575 | | | | 698 | |
| Other liabilities | | | 5,152 | | | | 3,589 | |
| | | | | | | | | |
| TOTAL LIABILITIES | | | 526,818 | | | | 491,839 | |
| | | | | | | | | |
| Stockholders' Equity | | | | | | | | |
| Common stock, $.50 par value; 5,000,000 shares authorized; | | | | | | | | |
| 1,653,746 and 1,652,318 shares issued | | | 827 | | | | 826 | |
| Capital surplus | | | 6,528 | | | | 6,273 | |
| Retained earnings | | | 49,177 | | | | 45,872 | |
| Accumulated other comprehensive income | | | 1,663 | | | | 588 | |
| Treasury stock, at cost (54,100 shares) | | | (2,067 | ) | | | (2,067 | ) |
| | | | | | | | | |
| TOTAL STOCKHOLDERS' EQUITY | | | 56,128 | | | | 51,492 | |
| | | | | | | | | |
| TOTAL LIABILITES AND STOCKHOLDERS' EQUITY | | $ | 582,946 | | | $ | 543,331 | |
This statement has not been reviewed or confirmed for accuracy or relevance by the FDIC.
DIMECO, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (unaudited)
| | (amounts in thousands, except per share) | | | | | | | | % Increase | | |
| | | | 2012 | | | 2011 | | | (decrease) | | |
| | Performance for the three months ended March 31, | | | | | | | | | | |
| | Interest income | | $ | 6,338 | | | $ | 6,029 | | | | 5.1 | % | |
| | Interest expense | | $ | 1,138 | | | $ | 1,381 | | | | -17.6 | % | |
| | Net interest income | | $ | 5,200 | | | $ | 4,648 | | | | 11.9 | % | |
| | Net income | | $ | 1,569 | | | $ | 1,270 | | | | 23.5 | % | |
| | | | | | | | | | | | | | | |
| | Shareholders' Value (per share) | | | | | | | | | | | | | |
| | Net income - basic | | $ | 0.98 | | | $ | 0.79 | | | | 24.1 | % | |
| | Net income - diluted | | $ | 0.98 | | | $ | 0.79 | | | | 24.1 | % | |
| | Dividends | | $ | 0.36 | | | $ | 0.36 | | | | - | | |
| | Book value | | $ | 35.09 | | | $ | 32.22 | | | | 8.9 | % | |
| | Market value | | $ | 36.50 | | | $ | 38.50 | | | | -5.2 | % | |
| | Market value/book value ratio | | | 104.0 | % | | | 119.5 | % | | | -13.0 | % | |
| * | Price/earnings multiple | | | 9.3 | | X | | 12.2 | | X | | -23.8 | % | X |
| * | Dividend yield | | | 3.95 | % | | | 3.74 | % | | | 5.6 | % | |
| | | | | | | | | | | | | | | |
| | Financial Ratios | | | | | | | | | | | | | |
| * | Return on average assets | | | 1.09 | % | | | 0.94 | % | | | 16.0 | % | |
| * | Return on average equity | | | 11.21 | % | | | 9.93 | % | | | 12.9 | % | |
| | Shareholders' equity/asset ratio | | | 9.63 | % | | | 9.48 | % | | | 1.6 | % | |
| | Dividend payout ratio | | | 36.73 | % | | | 45.57 | % | | | -19.4 | % | |
| | Nonperforming assets/total assets | | | 4.09 | % | | | 3.20 | % | | | 27.8 | % | |
| | Allowance for loan loss as a % of loans | | | 1.94 | % | | | 1.68 | % | | | 15.5 | % | |
| | Net charge-offs/average loans | | | 0.03 | % | | | 0.25 | % | | | -88.0 | % | |
| | Allowance for loan loss/nonaccrual loans | | | 55.34 | % | | | 56.75 | % | | | -2.5 | % | |
| | Allowance for loan loss/non-performing loans | | | 41.77 | % | | | 53.31 | % | | | -21.6 | % | |
| | | | | | | | | | | | | | | |
| | Financial Position at March 31, | | | | | | | | | | | | | |
| | Assets | | $ | 582,946 | | | $ | 543,331 | | | | 7.3 | % | |
| | Loans | | $ | 454,352 | | | $ | 422,468 | | | | 7.5 | % | |
| | Deposits | | $ | 475,765 | | | $ | 450,567 | | | | 5.6 | % | |
| | Stockholders' equity | | $ | 56,128 | | | $ | 51,492 | | | | 9.0 | % | |
April 2012
Dear Shareholders:
I am pleased to present this report of Dimeco, Inc. for the first quarter of 2012. Included in this report are many positive results. When compared to the same period last year, you will see that 2012 is off to a good start. Deposits, loans, and total assets have all increased handsomely. For us, these increases are indications that the products and services we offer are valued by our customers. In addition, this growth indicates expansion within our existing markets and penetration into new local markets within northeastern Pennsylvania.
Our performance for this first quarter is significantly better than last year. Net income, one of the primary benchmarks of performance, grew by 23.5%. Furthermore, our return on average assets is 1.09%, an up tick of 16%, and our return on average equity is 11.21%, an expansion of almost 13%. The quarterly dividend of $.36 per share produces a solid yield of 3.95%, a return that is superior to that of many investments in today’s economy. Finally, from your ownership perspective, stockholders’ equity is $56.1 million, an increase of 9% over the previous year.
In addition to producing the above mentioned results, we continued to address asset quality issues during the quarter. As mentioned in previous quarterly letters, we have greatly enhanced our loan monitoring and collection activities, directed toward reducing loan delinquencies and troubled credits as quickly as possible. It is hoped that as this year progresses, we will be able to make positive reports with each ensuing quarterly letter. In the first quarter of 2012, we sold a property that was held in other real estate owned and have an agreement of sale on another property. These are some of the initial, beneficial outcomes of our concerted efforts to improve asset quality. As promised, we will continue to keep you informed of the results of our actions.
We thank you for your investment and loyalty. We ask that you continue to recommend us for banking and wealth management services, as well as for investment in Dimeco, Inc. stock. As always, your comments and questions are welcome.
Sincerely,
/s/ Gary C. Beilman
Gary C. Beilman
President and Chief Executive Officer
