UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): January 16, 2004
FIRST FINANCIAL BANKSHARES, INC.
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(Exact Name of Registrant as Specified in its Charter)
Texas 0-7674 75-0944023
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(State of Incorporation) (Commission File No.) (IRS Employer
Identification No.)
400 Pine Street, Abilene, Texas 79601
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(Address of Principal Executive Offices and Zip Code)
Registrant's Telephone Number (325) 627-7155
ITEM 12. Results of Operations and Financial Condition
Attached as an exhibit to this Form 8-K is the earnings release for the
quarter ended December 31, 2003 of First Financial Bankshares, Inc.
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
FIRST FINANCIAL BANKSHARES, INC.
(Registrant)
DATE: January 16, 2004 By: /S/ F. Scott Dueser
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F. SCOTT DUESER
President and Chief Executive Officer
EXHIBIT
For immediate release For More Information:
J. Bruce Hildebrand, Executive Vice President
325.627.7167
FIRST FINANCIAL BANKSHARES ANNOUNCES EARNINGS RESULTS WITH 17TH CONSECUTIVE YEAR
OF INCREASED EARNINGS
ABILENE, Texas, January 16, 2004 - First Financial Bankshares, Inc. today
reported quarterly earnings of $8.52 million for the fourth quarter of 2003 as
compared to $8.55 million for the same period last year, virtually unchanged.
Earnings per share for the quarter amounted to $0.55 for both 2003 and 2002.
For the year ended December 31, 2003, net income totaled $35.30 million as
compared to $33.95 million for the same period in 2002, which was the 17th
consecutive year of increased earnings. Earnings per share for 2003 rose to
$2.28 as compared to $2.20 for the prior year. Net income and earnings per share
for the 2003 year represented increases of 4.0% and 3.6%, respectively.
As of December 31, 2003, consolidated assets for the Company totaled $2.093
billion, compared to $1.993 billion a year earlier. Loans increased slightly
from $964.0 million at December 31, 2002 to $987.5 million at December 31, 2003.
Total deposits were $1.796 billion compared to $1.712 billion in 2002.
Shareholders' equity at December 31, 2003, amounted to $251.5 million versus
$238.8 million the prior year.
"We were pleased with the growth in our asset base and the increase in earnings
for the year, even though earnings were flat for the fourth quarter," stated F.
Scott Dueser, President and Chief Executive Officer. "The compressed interest
margins for the year decreased our net interest income through the accelerated
amortization of mortgage-backed bond premiums and lower loan rates. This
decrease was offset by lower loan loss provisions, an increase in real estate
mortgage fees and additional premiums on the early sale of student loans."
"Fourth quarter 2003 earnings were flat with fourth quarter 2002 due to
compressed interest margins, lower mortgage fees, and lower gain on sale of
student loans, primarily due to the large sale of student loans earlier in the
year."
"For the year we experienced a $14 million growth in commercial loans and a $43
million growth in real estate loans," Dueser said. "However, this was offset by
a $20 million decline in consumer loans and a $20 million reduction in student
loans. This reduction in student loans is anticipated to continue due to the
additional premium we can earn by selling these loans at an earlier date. We
experienced an $85 million increase in deposits in 2003 primarily fueled from a
$47 million increase in noninterest bearing demand deposits."
First Financial Bankshares, Inc., a family of community banks headquartered in
Abilene, Texas, operates 10 separately-chartered banks with 28 locations in
Texas and a trust company. These subsidiaries are First National Bank of
Abilene; Hereford State Bank; First National Bank, Sweetwater; Eastland National
Bank; First Financial Bank, National Association, Cleburne; Stephenville Bank &
Trust Co.; San Angelo National Bank; Weatherford National Bank; First Financial
Bank, National Association, Southlake; City National Bank, Mineral Wells and
First Financial Trust & Asset Management Company, National Association. The
Company is listed on The Nasdaq Stock Market under the trading symbol FFIN. For
more information about First Financial Bankshares; please visit our web site at
http://www.ffin.com.
*****
The numbers contained within this release are unaudited. Certain statements
contained herein may be considered "forward-looking statements" as defined in
the Private Securities Litigation Reform Act of 1995. These statements are based
upon the belief of the Company's management, as well as assumptions made beyond
information currently available to the Company's management, and may be, but not
necessarily are, identified by such words as "expect", "plan", "anticipate",
"target", "forecast" and "goal". Because such "forward-looking statements" are
subject to risks and uncertainties, actual results may differ materially from
those expressed or implied by such forward-looking statements. Factors that
could cause actual results to differ materially from the Company's expectations
include competition from other financial institutions and financial holding
companies; the effects of and changes in trade, monetary and fiscal policies and
laws, including interest rate policies of the Federal Reserve Board; changes in
the demand for loans; fluctuations in value of collateral and loan reserves;
inflation, interest rate, market and monetary fluctuations; changes in consumer
spending, borrowing and savings habits; and acquisitions and integration of
acquired businesses, and similar variables. Other key risks are described in the
Company's reports filed with the Securities and Exchange Commission, which may
be obtained under "Investor Relations-Documents/Filings" on the Company's web
site or by writing or calling the Company at 325.627.7155. Except as otherwise
stated in this news announcement, the Company does not undertake any obligation
to update publicly or revise any forward-looking statements because of new
information, future events or otherwise.
FIRST FINANCIAL BANKSHARES, INC.
CONSOLIDATED FINANCIAL SUMMARY (UNAUDITED)
(In thousands, except per share data)
December 31,
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2003 2002
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ASSETS:
Cash and due from banks $ 112,817 $ 110,761
Fed funds sold 1,900 70,000
Investment securities 910,302 772,256
Loans 987,523 964,040
Allowance for loan losses (11,576) (11,219)
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Net loans 975,947 952,821
Premises and equipment 43,902 40,606
Intangible assets 24,718 24,871
Other assets 22,985 21,868
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Total assets $ 2,092,571 $ 1,993,183
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LIABILITIES AND SHAREHOLDERS' EQUITY:
Noninterest-bearing deposits $ 472,575 $ 425,473
Interest-bearing deposits 1,323,696 1,286,089
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Total deposits 1,796,271 1,711,562
Repurchase agreements 28,975 26,709
Other liabilities 15,838 16,144
Shareholders' equity 251,487 238,768
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Total liabilities and shareholders' equity $ 2,092,571 $ 1,993,183
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Three Months Ended Year Ended
December 31, December 31,
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INCOME STATEMENTS 2003 2002 2003 2002
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Interest income $ 23,729 $ 25,591 $ 95,285 $ 104,285
Interest expense 3,830 5,244 17,131 24,380
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Net interest income 19,899 20,347 78,154 79,905
Provision for loan losses 208 809 1,178 2,370
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Net interest income after
provision for loan losses 19,691 19,538 76,976 77,535
Net gain on sale of student loans 56 157 1,896 783
Net gain (loss) on real estate and other assets 15 (3) 743 7
Net gain on securities transactions 9 0 25 16
Real estate mortgage fees 440 541 2,923 1,858
Other noninterest income 7,157 7,259 28,522 27,466
Noninterest expense 15,622 15,247 61,154 59,082
-------------- -------------- --------------- ---------------
Net income before income taxes 11,746 12,245 49,931 48,583
Income tax expense 3,226 3,694 14,626 14,630
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Net income $ 8,520 $ 8,551 $ 35,305 $ 33,953
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PER COMMON SHARE DATA
Net income - basic $ 0.55 $ 0.55 $ 2.28 $ 2.20
Net income - diluted 0.55 0.55 2.27 2.19
Cash dividends 0.31 0.28 1.21 1.08
Book value 16.25 15.45
Market value 41.12 30.40
PERFORMANCE RATIOS
Return on average assets 1.64 % 1.74 % 1.75 % 1.78 %
Return on average equity 13.55 14.29 14.40 14.97
Net interest margin (tax equivalent) 4.44 4.73 4.44 4.78
Efficiency ratio (tax equivalent) 54.15 52.12 52.52 51.96
FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands, except per share data)
2003 2002
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Dec. 31, Sept. 30, June 30, March 31, Dec. 31,
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ALLOWANCE FOR LOAN LOSSES
Balance at beginning of period $ 11,462 $ 11,523 $ 11,363 $ 11,219 $ 11,530
Loans charged off (401) (526) (347) (902) (1,291)
Loan recoveries 307 232 281 535 171
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Net (charge-offs) recoveries (94) (294) (66) (367) (1,120)
Provision for loan losses 208 233 226 511 809
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Balance at end of period $ 11,576 $ 11,462 $ 11,523 $ 11,363 $ 11,219
============== ============== ============== =============== ===============
Allowance for loan losses /
period-end loans 1.17 % 1.21 % 1.25 % 1.19 % 1.16 %
Allowance for loan losses /
nonperforming loans 661.0 711.1 823.7 589.4 300.8
Net charge-offs / average loans
(annualized) 0.04 0.12 0.03 0.15 0.46
NONPERFORMING ASSETS
Nonaccrual loans $ 1,690 $ 1,552 $ 1,299 $ 1,829 $ 3,716
Accruing loans 90 days past due 61 60 100 99 14
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Total nonperforming loans 1,751 1,612 1,399 1,928 3,730
Foreclosed assets 1,420 1,411 1,445 1,345 536
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Total nonperforming assets $ 3,171 $ 3,023 $ 2,844 $ 3,273 $ 4,266
============== ============== ============== =============== ===============
As a % of loans and foreclosed assets 0.32 % 0.32 % 0.31 % 0.34 % 0.44 %
CAPITAL RATIOS
Tier 1 Risk-based 18.83 % 19.14 % 19.16 % 19.33 % 18.42 %
Total Risk-based 19.83 20.17 20.22 20.40 19.47
Tier 1 Leverage 10.60 10.55 10.46 10.35 10.51
Equity to assets 12.02 12.03 12.38 12.03 11.98