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): October 19, 2004
FIRST FINANCIAL BANKSHARES, INC.
--------------------------------
(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 2.02 Results of Operations and Financial Condition
Attached as an exhibit to this Form 8-K is the earnings release for the
quarter ended September 30, 2004 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: October 19, 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
325.627.7155
FIRST FINANCIAL BANKSHARES ANNOUNCES
8.1 PERCENT INCREASE IN THIRD QUARTER EARNINGS
ABILENE, Texas, October 19, 2004 - First Financial Bankshares, Inc. today
reported quarterly earnings of $9.85 million for the third quarter of 2004 as
compared to $9.11 million for the same period last year, an increase of 8.1
percent. Basic earnings per share for the quarter amounted to $0.64 as compared
to $0.59 for the third quarter of 2003, an 8.5 percent increase.
Several factors contributed to the Company's improved earnings for the third
quarter. Net interest income increased 11.4 percent to $21.30 million compared
to $19.11 million in the previous year's third quarter, primarily as the result
of rising interest rates and a higher volume of loans. Revenue from service fees
increased 45.2 percent over the third quarter of 2003, from $3.98 million to
$5.78 million, primarily as a result of an increased number of accounts and
transactions. At the same time, noninterest expense increased 12.8 percent, to
$16.81 million compared to $14.90 million in the same quarter of the prior year,
due primarily to increased accruals for the Company's profit sharing plan caused
by increased earnings.
For the first nine months ended September 30, 2004, net income totaled $29.11
million as compared to $26.78 million for the first nine months of 2003, an
increase of 8.7 percent. Basic earnings per share for the first nine months of
2004 were $1.88 compared to $1.73, an increase of 8.7 percent.
As of September 30, 2004, consolidated assets for the Company totaled $2.206
billion, compared to $2.070 billion at the same time a year ago. Loans totaled
$1.126 billion at September 30, 2004, an increase of 18.7 percent compared to
loans of $948.5 million a year ago. Total deposits stood at $1.847 billion at
September 30, 2004, compared to $1.788 billion the previous year. Shareholders'
equity rose to $264.3 million at September 30, 2004, compared to $249.1 million
the prior year.
"We benefited in the third quarter from an improving economy, rising interest
rates and the successful implementation of new products," said F. Scott Dueser,
President and Chief Executive Officer. "Noninterest income continued to improve
and loan volume showed strength, especially in the market for real estate and
commercial loans. We also continued to grow our franchise during the quarter,
including completion of the acquisition of Liberty National Bank in Granbury and
the announcement of plans to acquire First National Bank, Glen Rose."
Headquartered in Abilene, Texas, First Financial Bankshares is a financial
holding company with consolidated assets totaling $2.2 billion operating eleven
separately chartered banks with 29 locations in Texas, a trust company and a
technology operating company. These subsidiaries are First National Bank of
Abilene, Abilene; Eastland National Bank, Eastland; First Financial Bank, N.A.,
Cleburne; Liberty National Bank, Granbury; Hereford State Bank, Hereford; City
National Bank, Mineral Wells; San Angelo National Bank, San Angelo; First
Financial Bank, N.A., Southlake; Stephenville Bank & Trust Co., Stephenville;
First National Bank, Sweetwater; Weatherford National Bank, Weatherford; First
Financial Trust & Asset Management Company, N.A.; and First Technology Services,
Inc.
The Company is listed on The Nasdaq Stock Market under the trading symbol FFIN.
For more information about First Financial Bankshares, access their Web site at
http://www.ffin.com.
*****
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 share and per share data)
September 30,
--------------------------------
2004 2003
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ASSETS:
Cash and due from banks $ 89,270 $ 112,016
Fed funds sold 7,750 30,750
Investment securities 892,982 900,585
Loans 1,125,940 948,521
Allowance for loan losses (13,680) (11,462)
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Net loans 1,112,260 937,059
Premises and equipment 47,602 42,844
Goodwill and intangible assets 31,824 24,769
Other assets 24,063 21,836
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Total assets $ 2,205,751 $ 2,069,859
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LIABILITIES AND SHAREHOLDERS' EQUITY:
Noninterest-bearing deposits $ 486,255 $ 446,796
Interest-bearing deposits 1,361,143 1,341,547
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Total deposits 1,847,398 1,788,343
Fed Funds purchased and repurchase agreements 72,000 13,934
Other liabilities 22,021 18,493
Shareholders' equity 264,332 249,089
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Total liabilities and shareholders' equity $ 2,205,751 $ 2,069,859
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Three Months Ended Nine Months Ended
September 30, September 30,
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INCOME STATEMENTS 2004 2003 2004 2003
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Interest income $ 25,391 $ 23,209 $ 73,311 $ 71,556
Interest expense 4,094 4,097 11,378 13,302
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Net interest income 21,297 19,112 61,933 58,254
Provision for loan losses 532 233 1,018 969
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Net interest income after
provision for loan losses 20,765 18,879 60,915 57,285
Net gain on sale of student loans 82 17 2,511 1,839
Trust fees 1,578 1,499 4,667 4,412
Service charges on deposits 5,785 3,983 15,057 11,778
Real estate mortgage fees 573 984 1,548 2,483
Net gain on sale of real estate 55 702 171 728
Other noninterest income 1,778 1,671 5,152 5,191
Noninterest expense 16,812 14,905 49,200 45,531
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Net income before income taxes 13,804 12,830 40,821 38,185
Income tax expense 3,951 3,716 11,708 11,400
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Net income $ 9,853 $ 9,114 $ 29,113 $ 26,785
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PER COMMON SHARE DATA
Net income - basic $ 0.64 $ 0.59 $ 1.88 $ 1.73
Net income - diluted 0.63 0.59 1.87 1.73
Cash dividends 0.34 0.31 0.99 0.90
Book value 17.05 16.10
Market value 40.16 36.96
Shares outstanding - end of period 15,501,471 15,475,767 15,501,471 15,475,767
Average outstanding shares - basic 15,498,069 15,474,478 15,490,849 15,465,858
Average outstanding shares - diluted 15,563,627 15,542,769 15,561,233 15,523,260
PERFORMANCE RATIOS
Return on average assets 1.82 % 1.78 % 1.84 % 1.78 %
Return on average equity 15.14 14.69 15.13 14.70
Net interest margin (tax equivalent) 4.52 4.35 4.51 4.38
Efficiency ratio 51.86 51.27 51.90 51.99
FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands)
Quarter Ended
2004 2003
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Sept 30, June 30, Mar. 31, Dec. 31, Sept 30,
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ALLOWANCE FOR LOAN LOSSES
Balance at beginning of period $ 11,932 $ 11,792 $ 11,576 $ 11,462 $ 11,523
Loans charged off (331) (317) (241) (401) (526)
Loan recoveries 147 149 279 307 232
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Net (charge-offs) recoveries (184) (168) 38 (94) (294)
Allowance established at acquisition 1,400 - - - -
Provision for loan losses 532 308 178 208 233
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Balance at end of period $ 13,680 $ 11,932 $ 11,792 $ 11,576 $ 11,462
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Allowance for loan losses /
period-end loans 1.21 % 1.18 % 1.22 % 1.17 % 1.21 %
Allowance for loan losses /
nonperforming loans 295.8 690.7 767.0 661.0 711.1
Net charge-offs / average loans
(annualized) 0.07 0.07 (0.02) 0.04 0.12
NONPERFORMING ASSETS
Nonaccrual loans $ 4,564 $ 1,691 $ 1,531 $ 1,690 $ 1,552
Accruing loans 90 days past due 60 36 6 61 60
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Total nonperforming loans 4,624 1,727 1,537 1,751 1,612
Foreclosed assets 514 798 961 1,420 1,411
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Total nonperforming assets $ 5,138 $ 2,525 $ 2,498 $ 3,171 $ 3,023
============= ============== ============= =============== ==============
As a % of loans and foreclosed assets 0.46 % 0.25 % 0.26 % 0.32 % 0.32 %
CAPITAL RATIOS
Tier 1 Risk-based 17.50 % 18.88 % 19.31 % 18.83 % 19.14 %
Total Risk-based 18.56 19.87 20.33 19.83 20.17
Tier 1 Leverage 10.46 10.95 10.79 10.60 10.55
Equity to assets 11.98 11.98 12.68 12.02 12.03
Three Months Ended Nine Months Ended
September 30, September 30,
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NONINTEREST EXPENSE 2004 2003 2004 2003
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Salaries and Employee Benefits $ 9,095 $ 8,029 $ 26,758 $ 24,842
Net Occupancy Expense 1,094 1,005 3,136 2,969
Equipment Expense 1,309 1,226 4,147 3,603
Printing, Stationery and Supplies 352 360 1,061 1,034
Service Charges from Correspondents 411 368 1,193 1,127
Amortization of Intangible Assets 47 34 115 101
Other Noninterest Expense 4,504 3,883 12,790 11,855
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Total Noninterest Expense $ 16,812 $ 14,905 $ 49,200 $ 45,531
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FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands)
Three Months Ended Nine Months Ended
SELECTED AVERAGE BALANCES September 30, September 30,
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2004 2003 2004 2003
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Total Loans $ 1,078,233 $ 941,110 $ 1,013,608 $ 940,277
Investment Securities 898,031 883,297 914,739 852,505
Federal Funds Sold and Other Short Term Investments 13,190 41,438 20,783 50,684
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Total Interest Earning Assets $ 1,989,454 $ 1,865,845 $ 1,949,130 $ 1,843,466
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Interest Bearing Deposits $ 1,344,737 $ 1,317,603 $ 1,326,765 $ 1,301,925
Federal Funds Purchased and Repurchase Agreements 72,025 13,721 58,756 19,562
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Total Interest Bearing Liabilities $ 1,416,762 $ 1,331,324 $ 1,385,521 $ 1,321,487
============== ============= =============== ==============
Shareholders' Equity $ 258,866 $ 246,162 $ 257,079 $ 243,687
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Total Assets $ 2,156,961 $ 2,030,553 $ 2,114,578 $ 2,006,698
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