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): April 21, 2005
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 or other Jurisdiction 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
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2 (b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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 March 31, 2005 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: April 21, 2005 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
FIRST QUARTER EARNINGS RESULTS
ABILENE, Texas, April 20, 2005 - First Financial Bankshares, Inc. today reported
earnings for the first quarter of 2005 of $12.1 million compared to $10.1
million in the same quarter the previous year. Basic earnings per share amounted
to $0.78 compared with $0.65 in the same period last year. These results include
the previously announced $3.0 million special distribution of proceeds to the
Company from the merger of PULSE EFT Association and Discover Financial
Services, Inc. Excluding the PULSE proceeds, net income for the first quarter of
2005 would have been $10.1 million, or $0.65 per share.
Several factors contributed to the first quarter's results. Net interest income
increased 12.1 percent to $22.9 million compared with $20.4 million in the same
quarter last year. The provision for loan losses rose to $410,000 in the first
quarter compared with $178,000 in the previous year's first quarter, primarily
as a result of loan growth. The net gain on sale of student loans was $1.3
million versus $1.8 million in the same quarter last year, the result of fewer
student loans sold. Trust fees increased 8.8 percent to $1.7 million compared
with $1.6 million in the same quarter last year. Revenue from service fees
increased 17.5 percent to $5.0 million compared with $4.3 million a year ago,
primarily as a result of increased use of an enhanced overdraft privilege
product introduced in the second quarter of 2004 and an increase in the number
of new accounts.
Noninterest expense increased 16.7 percent to $18.5 million from $15.9 million
in the same quarter last year. Salaries and employee benefits rose 12.4 percent
to $9.9 million in the first quarter of 2005 versus $8.8 million a year ago, due
primarily to an increased number of total employees resulting from the recent
acquisitions of banks in Granbury, Glen Rose and Clyde. The Company also
incurred approximately $625,000 in the first quarter of 2005 from conversion and
transition costs related to the acquisition of The Peoples State Bank in Clyde,
additional audit costs from the implementation of provisions of Sarbanes-Oxley,
and initial operating losses from the opening of the new Willow Park branch in
late December 2004.
As of March 31, 2005, consolidated assets for the Company totaled $2.41 billion
compared with $2.08 billion a year ago. Loans increased 24.2 percent in the
first quarter of 2005 to $1.2 billion from $965.7 million in the same quarter
last year. Total deposits rose 17.1 percent to $2.1 billion from $1.8 billion a
year earlier. The acquisition of banks in Granbury, Glen Rose and Clyde
accounted for $132 million of the loan growth and $211 million of the deposit
growth. Shareholders' equity rose to $266.6 million as of March 31, 2005,
compared with $263.4 million the prior year.
"Given the additional expenses we incurred from acquisition costs and
Sarbanes-Oxley, we are pleased with the overall results of the first quarter,"
said F. Scott Dueser, President and Chief Executive Officer. "The continued
growth of our franchise is very positive with the recent acquisitions of banks
in Granbury, Glen Rose and Clyde, plus the opening of new branches in Willow
Park and Abilene. The integration of these banks into our template is going
well, and we are very pleased with the bankers who have become part of our
family through these acquisitions. While we remain committed to growth, we are
equally committed to working to improve our net earnings in the quarters ahead."
Headquartered in Abilene, Texas, First Financial Bankshares is a financial
holding company with consolidated assets totaling $2.4 billion operating ten
separately chartered banks with 38 locations in Texas, a trust company and a
technology operating company. These subsidiaries are First Financial Bank, N.A.,
Abilene, Clyde and Moran; First Financial Bank, N.A., Eastland, Ranger and
Rising Star; First Financial Bank, N.A., Cleburne, Burleson and Alvarado;
Hereford State Bank, Hereford; City National Bank, Mineral Wells; San Angelo
National Bank, San Angelo; First Financial Bank, N.A., Southlake, Trophy Club
and Keller; First Financial Bank, N.A., Stephenville, Granbury and Glen Rose;
First National Bank, Sweetwater, Roby and Trent; Weatherford National Bank,
Weatherford, Willow Park and Aledo; 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, please visit our 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)
March 31,
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2005 2004
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ASSETS:
Cash and due from banks $ 91,934 $ 88,787
Fed funds sold 50,950 15,175
Investment securities 947,346 930,430
Loans 1,199,117 965,731
Allowance for loan losses (14,409) (11,792)
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Net loans 1,184,708 953,939
Premises and equipment 53,997 43,542
Goodwill and intangible assets 53,714 24,684
Other assets 25,692 21,137
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Total assets $ 2,408,341 $ 2,077,694
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LIABILITIES AND SHAREHOLDERS' EQUITY:
Noninterest-bearing deposits $ 521,453 $ 455,107
Interest-bearing deposits 1,556,481 1,319,173
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Total deposits 2,077,934 1,774,280
Fed Funds purchased and repurchase agreements 43,520 15,438
Other liabilities 20,322 24,601
Shareholders' equity 266,565 263,375
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Total liabilities and shareholders' equity $ 2,408,341 $ 2,077,694
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Three Months Ended
March 31,
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INCOME STATEMENTS 2005 2004
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Interest income $ 28,534 $ 24,011
Interest expense 5,677 3,627
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Net interest income 22,857 20,384
Provision for loan losses 410 178
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Net interest income after
provision for loan losses 22,447 20,206
Noninterest income 13,350 9,903
Noninterest expense 18,542 15,890
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Net income before income taxes 17,255 14,219
Income tax expense 5,179 4,126
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Net income $ 12,076 $ 10,093
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PER COMMON SHARE DATA
Net income - basic $ 0.78 $ 0.65
Net income - diluted 0.78 0.65
Cash dividends 0.34 0.31
Book value 17.18 17.01
Market value 44.63 40.19
Shares outstanding - end of period 15,516,482 15,486,322
Average outstanding shares - basic 15,513,294 15,483,756
Average outstanding shares - diluted 15,579,419 15,558,525
PERFORMANCE RATIOS
Return on average assets 2.04 % 1.96 %
Return on average equity 18.19 15.85
Net interest margin (tax equivalent) 4.52 4.57
Efficiency ratio 49.54 50.40
FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands, except per share data)
Quarter Ended
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2005 2004
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March 31, Dec. 31, Sept. 30, June 30, March 31,
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ALLOWANCE FOR LOAN LOSSES
Balance at beginning of period $ 13,837 $ 13,680 $ 11,932 $ 11,792 $ 11,576
Loans charged off (390) (1,099) (331) (317) (241)
Loan recoveries 187 185 147 149 279
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Net (charge-offs) recoveries (203) (914) (184) (168) 38
Allowance established at acquisition 365 457 1,400 - -
Provision for loan losses 410 614 532 308 178
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Balance at end of period $ 14,409 $ 13,837 $ 13,680 $ 11,932 $ 11,792
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Allowance for loan losses /
period-end loans 1.20 % 1.19 % 1.21 % 1.18 % 1.22 %
Allowance for loan losses /
nonperforming loans 462.6 324.7 295.8 690.7 767.0
Net charge-offs / average loans
(annualized) 0.07 0.32 0.07 0.07 (0.02)
NONPERFORMING ASSETS
Nonaccrual loans $ 3,112 $ 4,142 $ 4,564 $ 1,691 $ 1,531
Accruing loans 90 days past due 3 120 60 36 6
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Total nonperforming loans 3,115 4,262 4,624 1,727 1,537
Foreclosed assets 1,138 779 514 798 961
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Total nonperforming assets $ 4,253 $ 5,041 $ 5,138 $ 2,525 $ 2,498
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As a % of loans and foreclosed assets 0.35 % 0.43 % 0.46 % 0.25 % 0.26 %
CAPITAL RATIOS
Tier 1 Risk-based 15.37 % 16.46 % 17.50 % 18.88 % 19.31 %
Total Risk-based 16.41 17.49 18.56 19.87 20.33
Tier 1 Leverage 8.94 9.80 10.46 10.95 10.79
Equity to assets 11.07 11.47 11.98 11.98 12.68
FIRST FINANCIAL BANKSHARES, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(In thousands, except per share data)
Three Months Ended
March 31,
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NONINTEREST INCOME 2005 2004
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Net gain on sale of student loans $ 1,309 $ 1,792
Net gain on sale of PULSE ownership rights 2,980 0
Net gain on securities transactions 41 18
Trust fees 1,715 1,576
Service charges on deposits 5,018 4,271
Real estate mortgage fees 412 424
Net gain on sale of real estate 12 114
ATM and credit card fees 1,123 875
Other 740 833
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Total $ 13,350 $ 9,903
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NONINTEREST EXPENSE
Salaries and employee benefits $ 9,879 $ 8,790
Net occupancy expense 1,155 999
Equipment expense 1,486 1,415
Printing, stationery and supplies 479 346
ATM and credit card expenses 680 550
Audit fees 395 180
Professional fees 589 259
Service charges from correspondents 383 384
Advertising and public relations 673 455
Amortization of intangible assets 103 34
Other 2,720 2,478
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Total $ 18,542 $ 15,890
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SELECTED AVERAGE BALANCES
2005 2004
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Total loans $ 1,205,462 $ 973,966
Investment securities 886,400 920,916
Federal funds sold and other short term investments 71,521 8,059
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Total interest earning assets $ 2,163,383 $ 1,902,941
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Interest-bearing deposits $ 1,539,383 $ 1,326,534
Federal funds purchased and repurchase agreements 44,421 24,804
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Total interest-bearing liabilities $ 1,583,804 $ 1,351,338
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Shareholders' equity $ 269,193 $ 256,152
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Total assets $ 2,401,232 $ 2,075,607
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