Exhibit 99
NEWS RELEASE
TO BUSINESS EDITOR
DIMECO, INC. ANNOUNCES EARNINGS AT SEPTEMBER 30, 2004
Dimeco, Inc. (Nasdaq DIMC), parent company of The Dime Bank, reported earnings for the nine months ended September 30, 2004 of $2,672,000, representing earnings per share of $1.74. Net interest income increased 6.7% during the first three quarters of 2004 versus the same period in 2003. In addition, dividends declared year to date increased 6.2% over the same period last year to $.69 per share. Dimeco, Inc. stock traded at $35.50 per share at September 30, 2004, an increase of 12.6% over the stock price one year earlier.
The Company continued to experience growth with total assets increasing $23,471,000 or 7.9% to $321,554,000 from September 30, 2003 to September 30, 2004. Return on average stockholders’ equity and return on average assets were 12.64% and 1.16%, respectively, at September 30, 2004.
Gary C. Beilman, EVP and CEO, stated, “I am happy to present Dimeco’s results of operations for the nine months ended September 30, 2004. Our growth is evident in that both loans and deposits are up. Loan quality continues to improve with delinquency under 1% and non-performing assets to total assets improving a significant 59.3% to end the quarter at .44%. During the next quarter we anticipate increased activity from our Title Insurance entity and our Investments Department. Additionally, we will continue to bring the best value to our customers and the community when we open our fifth community office in Dingmans Ferry later this fall. All are welcome to share in our Grand Opening Celebrations.”
The Dime Bank 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 along with a Trust Department and an Investments and Financial Services Department. For more information on The Dime Bank, visit www.thedimebank.com
Source Dimeco, Inc. / September 20, 2004
Contact: Deborah Unflat-Petroski, Marketing Officer
DIMECO, INC.
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
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| | | Three Months Ended September 30,
| | | Nine Months Ended September 30,
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(in thousands, except per share) | | 2004
| | 2003
| | | 2004
| | 2003
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Interest Income | | | | | | | | | | | | | | |
Interest and fees on loans | | $ | 3,564 | | $ | 3,281 | | | $ | 10,110 | | $ | 9,639 | |
Investment securities | | | 483 | | | 555 | | | | 1,473 | | | 1,851 | |
Other | | | 4 | | | 2 | | | | 19 | | | 21 | |
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Total interest income | | | 4,051 | | | 3,838 | | | | 11,602 | | | 11,511 | |
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Interest Expense | | | | | | | | | | | | | | |
Deposits | | | 976 | | | 1,074 | | | | 2,927 | | | 3,354 | |
Short-term borrowings | | | 35 | | | 28 | | | | 89 | | | 88 | |
Other borrowed funds | | | 99 | | | 55 | | | | 175 | | | 187 | |
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Total interest expense | | | 1,110 | | | 1,157 | | | | 3,191 | | | 3,629 | |
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Net Interest Income | | | 2,941 | | | 2,681 | | | | 8,411 | | | 7,882 | |
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Provision for loan losses | | | 261 | | | 230 | | | | 1,126 | | | 680 | |
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Net Interest Income AfterProvision for Loan Losses | | | 2,680 | | | 2,451 | | | | 7,285 | | | 7,202 | |
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Noninterest Income | | | 694 | | | 700 | | | | 2,096 | | | 1,881 | |
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Noninterest Expense | | | | | | | | | | | | | | |
Salaries and employee benefits | | | 973 | | | 913 | | | | 2,880 | | | 2,581 | |
Other expense | | | 898 | | | 819 | | | | 2,645 | | | 2,379 | |
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Total noninterest expense | | | 1,871 | | | 1,732 | | | | 5,525 | | | 4,960 | |
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Income before income taxes | | | 1,503 | | | 1,419 | | | | 3,856 | | | 4,123 | |
Income taxes | | | 465 | | | 399 | | | | 1,184 | | | 1,257 | |
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NET INCOME | | $ | 1,038 | | $ | 1,020 | | | $ | 2,672 | | $ | 2,866 | |
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Earnings per Share - basic | | $ | 0.67 | | $ | 0.68 | * | | $ | 1.74 | | $ | 1.90 | * |
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Earnings per Share - diluted | | $ | 0.65 | | $ | 0.63 | * | | $ | 1.67 | | $ | 1.83 | * |
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Average shares outstanding - basic | | | 1,538,727 | | | 1,513,312 | * | | | 1,534,681 | | | 1,512,860 | * |
Average shares outstanding - diluted | | | 1,599,004 | | | 1,625,430 | * | | | 1,599,977 | | | 1,571,812 | * |
| * | Adjusted to reflect 100% stock split effected in the form of a dividend on 12/1/03. |
This statement has not been reviewed or confirmed for accuracy or relevance by the FDIC.
DIMECO, INC.
CONSOLIDATED BALANCE SHEET (UNAUDITED)
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September 30, | | 2004
| | 2003
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(in thousands) | | | | | |
Assets | | | | | | | |
Cash and due from banks | | $ | 7,563 | | $ | 10,020 | |
Interest-bearing deposits in other banks | | | 33 | | | 16 | |
Federal funds sold | | | 5,712 | | | 4,250 | |
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Total cash and cash equivalents | | | 13,308 | | | 14,286 | |
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Mortgage loans held for sale | | | 548 | | | 892 | |
Investment securities available for sale | | | 43,846 | | | 54,086 | |
Investment securities held to maturity (market value of $220 and $232) | | | 198 | | | 197 | |
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Loans (net of unearned income of $675 and $763) | | | 252,512 | | | 219,260 | |
Less allowance for loan losses | | | 3,314 | | | 3,103 | |
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Net loans | | | 249,198 | | | 216,157 | |
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Premises and equipment | | | 5,159 | | | 4,249 | |
Bank-owned life insurance | | | 5,018 | | | 4,807 | |
Accrued interest receivable | | | 1,210 | | | 1,285 | |
Other assets | | | 3,069 | | | 2,124 | |
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TOTAL ASSETS | | $ | 321,554 | | $ | 298,083 | |
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Liabilities | | | | | | | |
Deposits : | | | | | | | |
Noninterest-bearing | | $ | 32,247 | | $ | 29,252 | |
Interest-bearing | | | 237,820 | | | 230,400 | |
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Total deposits | | | 270,067 | | | 259,652 | |
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Short-term borrowings | | | 10,915 | | | 9,105 | |
Other borrowed funds | | | 9,845 | | | 1,000 | |
Accrued interest payable | | | 513 | | | 631 | |
Other liabilities | | | 1,429 | | | 1,165 | |
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TOTAL LIABILITIES | | | 292,769 | | | 271,553 | |
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Stockholders’ Equity | | | | | | | |
Common stock, $.50 par value; 5,000,000 shares authorized; 1,541,494 and 758,855 shares issued | | | 771 | | | 379 | |
Capital surplus | | | 4,174 | | | 3,796 | |
Retained earnings | | | 23,649 | | | 21,793 | |
Accumulated other comprehensive income | | | 191 | | | 595 | |
Treasury stock, at cost (520 shares) | | | — | | | (33 | ) |
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TOTAL STOCKHOLDERS’ EQUITY | | | 28,785 | | | 26,530 | |
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | | $ | 321,554 | | $ | 298,083 | |
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This statement has not been reviewed or confirmed for accuracy or relevance by the FDIC.
CONSOLIDATED FINANCIAL HIGHLIGHTS
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(amounts in thousands, except per share) | | 2004
| | | 2003
| | | % Increase
(decrease)
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Performance for the nine months ended September 30, | | | | | | | | | | | |
Interest income | | $ | 11,602 | | | $ | 11,511 | | | 0.8 | % |
Interest expense | | $ | 3,191 | | | $ | 3,629 | | | -12.1 | % |
Net interest income | | $ | 8,411 | | | $ | 7,882 | | | 6.7 | % |
Net income | | $ | 2,672 | | | $ | 2,866 | | | -6.8 | % |
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Shareholders’ Value (per share) | | | | | | | | | | | |
Net income - basic | | $ | 1.74 | | | $ | 1.90 | (1) | | -8.4 | % |
Net income - diluted | | $ | 1.67 | | | $ | 1.83 | (1) | | -8.7 | % |
Dividends | | $ | 0.69 | | | $ | 0.65 | (1) | | 6.2 | % |
Book value | | $ | 18.67 | | | $ | 17.48 | (1) | | 6.8 | % |
Market value | | $ | 35.50 | | | $ | 31.53 | (1) | | 12.6 | % |
Market value/book value ratio | | | 190.1 | % | | | 180.4 | % | | 5.4 | % |
* Price/earnings multiple | | | 15.3 | X | | | 13.0 | X | | 17.7 | % |
* Dividend yield | | | 2.59 | % | | | 2.73 | % | | -5.1 | % |
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Financial Ratios | | | | | | | | | | | |
* Return on average assets | | | 1.16 | % | | | 1.35 | % | | -14.1 | % |
* Return on average equity | | | 12.64 | % | | | 14.85 | % | | -14.9 | % |
Shareholders’ equity/asset ratio | | | 8.95 | % | | | 8.90 | % | | 0.6 | % |
Dividend payout ratio | | | 39.66 | % | | | 34.21 | % | | 15.9 | % |
Nonperforming assets/total assets | | | 0.44 | % | | | 1.08 | % | | -59.3 | % |
Allowance for loan loss as a % of loans | | | 1.31 | % | | | 1.42 | % | | -7.8 | % |
* Net charge-offs/average loans | | | 0.47 | % | | | 0.26 | % | | 80.8 | % |
Allowance for loan loss/nonaccrual loans | | | 283.25 | % | | | 112.35 | % | | 152.1 | % |
Allowance for loan loss/non-performing loans | | | 234.04 | % | | | 96.61 | % | | 142.3 | % |
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Financial Position at September 30, | | | | | | | | | | | |
Assets | | $ | 321,554 | | | $ | 298,083 | | | 7.9 | % |
Loans | | $ | 252,512 | | | $ | 219,260 | | | 15.2 | % |
Deposits | | $ | 270,067 | | | $ | 259,652 | | | 4.0 | % |
Stockholders’ equity | | $ | 28,785 | | | $ | 26,530 | | | 8.5 | % |
| (1) | Adjusted to reflect 100% stock split effected in the form of a dividend on 12/1/03. |
Jeff - Please put brackets around negative numbers instead of - sign.
- Don’t print leading 0 when there are no whole dollars or percentages.
October 2004
Dear Shareholders:
With the end of the third quarter of 2004, I am happy to present the results of operations of Dimeco, Inc. Compared to 2003, the Company continues to grow with deposits up 4%, loans increasing 15.2%, and total assets expanding 7.9% to close this period at over $321 million. Loan quality continues to improve with delinquency under 1% and with non-performing assets to total assets improving a significant 59.3% to end the quarter at .44%. Net income, although somewhat slower than last year’s robust pace, came in at a healthy $2.67 million.
From these profits we returned to you, our stockholders, a dividend of $.69 per share, representing a payout ratio of 39.66%. This quarter’s $.23 per share dividend is up 6.2% from that of last year. Further, you will see that shareholders’ equity has increased by 8.5% and is now up to $28.7 million. Simultaneously, it is noted that the book value of your investment has increased 6.8% per share. During this past quarter, the market price of Dimeco has vacillated in response to overall market acceptance of financial services companies. Given this market activity, your per share value has increased 12.6% over a year ago.
During the next quarter, we anticipate increased activity and revenues from our Title Insurance entity and our Investments department. Additionally, we will open our fifth community office in Dingmans Ferry, which we expect will be met with great enthusiasm.
As always, your comments and questions are welcome. We appreciate your commitment as well as your investment.
Sincerely,
Gary C. Beilman
Executive Vice President and
Chief Executive Officer
