Exhibit 99.1
[SUMMIT FINANCIAL GROUP, INC. LETTERHEAD]
FOR RELEASE 6:00 PM EDT, WEDNESDAY, APRIL 16, 2003
April 16, 2003
Contact: Robert S. Tissue, Sr. Vice President & CFO
Telephone: (304) 538-7233, Ext. 152
Email: rtissue@SummitFGI.com
SUMMIT FINANCIAL GROUP ANNOUNCES Q1 2003 EARNINGS
GAAP Basis Diluted EPS Grows 15%
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF) today reported first quarter
2003 GAAP net income of $1,864,000 or $0.53 per diluted share, up 15.2 percent
on an earnings per share basis from the $1,631,000, or $0.46 per diluted share,
reported in the first quarter of 2002. Net income for the first quarter of 2003
generated an annualized return on average shareholders' equity of 14.33% and an
annualized return on average assets of 1.09% compared to first quarter ratios of
14.75% and 1.10%, respectively, in the prior year.
Operating earnings, which exclude the impact of nonrecurring income and
expense items, for first quarter 2003 were $1,851,000 or $0.52 per diluted
share, up 13.0 percent on an earnings per share basis compared to operating
earnings of $1,609,000 or $0.46 per diluted share for first quarter 2002.
Summit's first quarter 2003 results, excluding nonrecurring items, produced an
annualized return on average shareholders' equity of 14.23% and an annualized
return on average assets of 1.08%, compared to prior year ratios of 14.55% and
1.08%, respectively. Nonrecurring items consisted principally of gains and
losses realized on securities transactions and other significant transactional
gains and losses.
"I am pleased to announce solid first quarter earnings, particularly
given the continued weakness in overall economic conditions," said H. Charles
Maddy, III, President and Chief Executive Officer. "Notwithstanding these
economic challenges, our Company has maintained healthy earnings momentum, while
our asset quality continues to compare favorably with the industry."
Summit Financial Group, Inc. is a financial holding company with total
assets of $711 million. Summit operates thirteen banking locations through its
three wholly owned subsidiary banks, Summit Community Bank headquartered in
Moorefield, West Virginia, Capital State Bank, Inc. in Charleston, West
Virginia, and Shenandoah Valley National Bank in Winchester, Virginia.
This press release contains forward-looking statements as defined by
federal securities laws. These statements may address issues that involve
significant risks, uncertainties, estimates and assumptions made by management.
Actual results could differ materially from current projections. Please refer to
Summit's filings with the Securities and Exchange Commission for a summary of
important factors that could affect Summit's forward-looking statements. Summit
undertakes no obligation to revise these statements following the date of this
press release.
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF)
Quarterly Performance Summary -- Q1 2003 vs Q1 2002
GAAP Basis
For the Quarter Ended Percent
---------------------------
Dollars in thousands, except per share amounts 3/31/03 3/31/02 Change
- -----------------------------------------------------------------------------------------------------
Condensed Statements of Income -- GAAP Basis
Interest income - taxable equivalent $ 10,408 $ 10,072 3.3%
Interest expense 4,461 4,655 -4.2%
---------- ----------
Net interest income - taxable equivalent 5,947 5,417 9.8%
Less: taxable equivalent adjustment 278 237 17.3%
---------- ----------
Net interest income 5,669 5,180 9.4%
Provision for loan losses 218 293 -25.6%
---------- ----------
Net interest income after provision
for loan losses 5,451 4,887 11.5%
Noninterest income 573 362 58.3%
Noninterest expense 3,340 2,977 12.2%
---------- ----------
Income before income taxes 2,684 2,272 18.1%
Income taxes 820 641 27.9%
---------- ----------
Net income $ 1,864 $ 1,631 14.3%
========== ==========
Per Share Data -- GAAP Basis
Basic earnings $ 0.53 $ 0.46 15.2%
Diluted earnings $ 0.53 $ 0.46 15.2%
Average shares outstanding
Basic 3,503,930 3,508,620 -0.1%
Diluted 3,529,886 3,532,402 -0.1%
Performance Ratios -- GAAP Basis
Return on average equity 14.33% 14.75% -2.8%
Return on average assets 1.09% 1.10% -0.9%
Net yield on earning assets - taxable equivalent 3.66% 3.86% -5.2%
Efficiency ratio (A) 53.09% 53.40% -0.6%
NOTE:
(A) - Excludes nonrecurring income and expense items and amortization
of intangibles.
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF)
Quarterly Performance Summary -- Q1 2003 vs Q1 2002
Excluding Nonrecurring Items
For the Quarter Ended Percent
---------------------------
Dollars in thousands, except per share amounts 3/31/03 3/31/02 Change
- -----------------------------------------------------------------------------------------------------
Condensed Statements of Income --
Excluding Nonrecurring Items
Interest income - taxable equivalent $ 10,408 $ 10,072 3.3%
Interest expense 4,461 4,655 -4.2%
---------- ----------
Net interest income - taxable equivalent 5,947 5,417 9.8%
Less: taxable equivalent adjustment 278 237 17.3%
---------- ----------
Net interest income 5,669 5,180 9.4%
Provision for loan losses 218 293 -25.6%
---------- ----------
Net interest income after provision
for loan losses 5,451 4,887 11.5%
Noninterest income 552 326 69.3%
Noninterest expense 3,340 2,977 12.2%
---------- ----------
Income before income taxes 2,663 2,236 19.1%
Income taxes 812 627 29.5%
---------- ----------
Net income excluding nonrecurring items $ 1,851 $ 1,609 15.0%
========== ==========
Per Share Data --
Excluding Nonrecurring Items
Basic earnings $ 0.53 $ 0.46 15.2%
Diluted earnings $ 0.52 $ 0.46 13.0%
Average shares outstanding
Basic 3,503,930 3,508,620 -0.1%
Diluted 3,529,886 3,532,402 -0.1%
Performance Ratios --
Excluding Nonrecurring Items
Return on average equity 14.23% 14.55% -2.2%
Return on average assets 1.08% 1.08% 0.0%
Net yield on earning assets - taxable equivalent 3.66% 3.86% -5.2%
Efficiency ratio (A) 53.09% 53.40% -0.6%
NOTE:
(A) - Excludes nonrecurring income and expense items and amortization
of intangibles.
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF)
Five Quarter Performance Summary
GAAP Basis
For the Quarter Ended
------------------------------------------------------------------
Dollars in thousands, except per share amounts 3/31/03 12/31/02 9/30/02 6/30/02 3/31/02
- --------------------------------------------------------------------------------------------------------------------------
Condensed Statements of Income -- GAAP Basis
Interest income - taxable equivalent $ 10,408 $ 10,738 $ 10,586 $ 10,290 $ 10,072
Interest expense 4,461 4,694 4,803 4,690 4,655
---------- ---------- ---------- ---------- ----------
Net interest income - taxable equivalent 5,947 6,044 5,783 5,600 5,417
Less: taxable equivalent adjustment 278 272 241 247 237
---------- ---------- ---------- ---------- ----------
Net interest income 5,669 5,772 5,542 5,353 5,180
Provision for loan losses 218 308 307 307 293
---------- ---------- ---------- ---------- ----------
Net interest income after provision
for loan losses 5,451 5,464 5,235 5,046 4,887
Noninterest income 573 407 601 575 362
Noninterest expense 3,340 3,227 3,115 3,288 2,977
---------- ---------- ---------- ---------- ----------
Income before income taxes 2,684 2,644 2,721 2,333 2,272
Income taxes 820 600 798 693 641
---------- ---------- ---------- ---------- ----------
Net income $ 1,864 $ 2,044 $ 1,923 $ 1,640 $ 1,631
========== ========== ========== ========== ==========
Per Share Data -- GAAP Basis
Basic earnings $ 0.53 $ 0.58 $ 0.55 $ 0.47 $ 0.46
Diluted earnings $ 0.53 $ 0.58 $ 0.54 $ 0.46 $ 0.46
Average shares outstanding
Basic 3,503,930 3,506,073 3,508,566 3,508,620 3,508,620
Diluted 3,529,886 3,525,115 3,536,220 3,535,900 3,532,402
Performance Ratios -- GAAP Basis
Return on average equity 14.33% 15.74% 15.62% 14.49% 14.75%
Return on average assets 1.09% 1.22% 1.20% 1.07% 1.10%
Net yield on earning assets - taxable equivalent 3.66% 3.83% 3.80% 3.86% 3.86%
Efficiency ratio (A) 53.09% 49.97% 50.15% 54.91% 53.40%
NOTE:
(A) - Excludes nonrecurring income and expense items and amortization of
intangibles.
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF)
Five Quarter Performance Summary
Excluding Nonrecurring Items
For the Quarter Ended
------------------------------------------------------------------
Dollars in thousands, except per share amounts 3/31/03 12/31/02 9/30/02 6/30/02 3/31/02
- --------------------------------------------------------------------------------------------------------------------------
Condensed Statements of Income --
Excluding Nonrecurring Items
Interest income - taxable equivalent $ 10,408 $ 10,738 $ 10,586 $ 10,290 $ 10,072
Interest expense 4,461 4,694 4,803 4,690 4,655
---------- ---------- ---------- ---------- ----------
Net interest income - taxable equivalent 5,947 6,044 5,783 5,600 5,417
Less: taxable equivalent adjustment 278 272 241 247 237
---------- ---------- ---------- ---------- ----------
Net interest income 5,669 5,772 5,542 5,353 5,180
Provision for loan losses 218 308 307 307 293
---------- ---------- ---------- ---------- ----------
Net interest income after provision
for loan losses 5,451 5,464 5,235 5,046 4,887
Noninterest income 552 610 592 565 326
Noninterest expense 3,340 3,227 3,115 3,288 2,977
---------- ---------- ---------- ---------- ----------
Income before income taxes 2,663 2,847 2,712 2,323 2,236
Income taxes 812 917 795 690 627
---------- ---------- ---------- ---------- ----------
Net income $ 1,851 $ 1,930 $ 1,917 $ 1,633 $ 1,609
========== ========== ========== ========== ==========
Per Share Data --
Excluding Nonrecurring Items
Basic earnings $ 0.53 $ 0.55 $ 0.55 $ 0.47 $ 0.46
Diluted earnings $ 0.52 $ 0.55 $ 0.54 $ 0.46 $ 0.46
Average shares outstanding
Basic 3,503,930 3,506,073 3,508,566 3,508,620 3,508,620
Diluted 3,529,886 3,525,115 3,536,220 3,535,900 3,532,402
Performance Ratios --
Excluding Nonrecurring Items
Return on average equity 14.23% 14.86% 15.56% 14.42% 14.55%
Return on average assets 1.08% 1.15% 1.19% 1.07% 1.08%
Net yield on earning assets - taxable equivalent 3.66% 3.83% 3.80% 3.86% 3.86%
Efficiency ratio (A) 53.09% 49.97% 50.15% 54.91% 53.40%
NOTE:
(A) - Excludes nonrecurring income and expense items and amortization of
intangibles.
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF)
Reconciliation of Operating Earnings to GAAP Net Income
For the Quarter Ended
-----------------------------------------------------------
Dollars in thousands 3/31/03 12/31/02 9/30/02 6/30/02 3/31/02
- -----------------------------------------------------------------------------------------------------
Operating earnings $ 1,851 $ 1,930 $ 1,917 $ 1,633 $ 1,609
Securities gains (losses):
Gross gains (losses) 41 (214) 9 12 53
Applicable income tax effect (16) 82 (3) (3) (21)
------- ------- ------- ------- -------
25 (132) 6 9 32
Other gains (losses):
Gross gains (losses) (20) 10 - (3) (16)
Applicable income tax effect 8 (4) - 1 6
------- ------- ------- ------- -------
(12) 6 - (2) (10)
Purchased State income tax credits - 240 - - -
------- ------- ------- ------- -------
GAAP net income $ 1,864 $ 2,044 $ 1,923 $ 1,640 $ 1,631
======= ======= ======= ======= =======
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF)
Selected Balance Sheet Data
As of Percent
--------------------------
Dollars in thousands,
except per share amounts 3/31/03 3/31/02 Change
- -------------------------------------------------------------------------------
Assets $ 710,794 $ 603,289 17.8%
Securities 231,560 206,446 12.2%
Loans, net 436,020 358,967 21.5%
Intangible assets 3,163 3,314 -4.6%
Deposits 468,842 399,752 17.3%
Short-term borrowings 28,029 18,861 48.6%
Long-term borrowings 152,713 133,813 14.1%
Shareholders' equity 53,399 45,023 18.6%
Book value per share $ 15.22 $ 12.83 18.6%
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF)
Asset Quality Information
For the Quarter Ended
---------------------------------------------------------------
Dollars in thousands 3/31/03 12/31/02 9/30/02 6/30/02 3/31/02
- ---------------------------------------------------------------------------------------------------------------------
Net loan charge-off's $ 142 $ 173 $ 29 $ 59 $ 11
Net loan charge-off's to average loans (annualized) 0.13% 0.18% 0.03% 0.07% 0.01%
Allowance for loan losses $4,129 $4,053 $3,919 $3,640 $3,392
Allowance for loan losses as a percentage
of period end loans 0.9% 1.0% 1.0% 1.0% 0.9%
Nonperforming assets:
Nonperforming loans $ 715 $1,491 $ 975 $ 806 $ 864
Foreclosed properties 677 81 81 119 81
Nonaccrual securities 412 421 - - -
------ ------ ------ ------ ------
Total $1,804 $1,993 $1,056 $ 925 $ 945
====== ====== ====== ====== ======
Nonperforming loans to period end loans
and other real estate 0.3% 0.4% 0.3% 0.2% 0.3%
=== === === === ===
Nonperforming assets to period end assets 0.3% 0.3% 0.2% 0.1% 0.2%
=== === === === ===
SUMMIT FINANCIAL GROUP, INC. (OTCBB: SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q1 2003 vs Q1 2002
Q1 2003 Q1 2002
----------------------------------- -----------------------------------
Average Earnings / Yield / Average Earnings / Yield /
Dollars in thousands Balances Expense Rate Balances Expense Rate
- ------------------------------------------------------------------------------- -----------------------------------
ASSETS
Interest earning assets
Loans, net of unearned interest
Taxable $ 422,953 $ 7,412 7.01% $ 346,877 $ 6,714 7.74%
Tax-exempt 6,208 127 8.18% 5,775 124 8.59%
Securities
Taxable 174,478 2,114 4.85% 171,374 2,601 6.07%
Tax-exempt 39,209 710 7.24% 32,325 599 7.41%
Interest bearing deposits other banks
and Federal funds sold 6,724 45 2.68% 5,175 34 2.63%
--------- ------- ---- --------- ------- ----
Total interest earning assets 649,572 10,408 6.41% 561,526 10,072 7.17%
Noninterest earning assets
Cash & due from banks 8,168 8,174
Premises & equipment 12,765 12,975
Other assets 19,895 13,870
Allowance for loan losses (4,091) (3,233)
------ ---------
Total assets $ 686,309 $ 593,312
========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits $ 99,283 $ 229 0.92% $ 82,414 $ 296 1.44%
Savings deposits 46,098 73 0.63% 44,612 141 1.26%
Time deposits 273,566 2,323 3.40% 233,648 2,454 4.20%
Short-term borrowings 21,337 80 1.50% 16,930 87 2.06%
Long-term borrowings and
capital trust securities 144,639 1,756 4.86% 130,758 1,677 5.13%
--------- ------- ---- --------- ------- ----
584,923 4,461 3.05% 508,362 4,655 3.66%
Noninterest bearing liabilities
Demand deposits 44,217 36,237
Other liabilities 5,152 4,488
--------- ---------
Total liabilities 634,292 549,087
Shareholders' equity 52,017 44,225
--------- ---------
Total liabilities and
shareholders' equity $ 686,309 $ 593,312
========= =========
NET INTEREST EARNINGS $ 5,947 $ 5,417
======= =======
NET INTEREST YIELD ON EARNING ASSETS 3.66% 3.86%
==== ====