Frankfort First Bancorp, Inc.
For Immediate Release April 21, 2003
Contact: Don Jennings, President, or Clay Hulette, Vice President
(502) 223-1638
216 West Main Street
P.O. Box 535
Frankfort, KY 40602
FRANKFORT FIRST BANCORP, INC. REPORTS QUARTERLY EARNINGS
Frankfort First Bancorp, Inc. (Nasdaq: FKKY), the holding company for First
Federal Savings Bank of Frankfort, Kentucky, announced net earnings of $293,000
or $0.23 diluted earnings per share for the three month period ended March 31,
2003, compared to $333,000 or $0.26 diluted earnings per share for the three
month period ended March 31, 2002. This results in a 12.0% decrease in net
earnings for the quarter. Net earnings for the nine month period ended March 31,
2003 were $1.0 million or diluted earnings per share of $0.79 compared to net
earnings of $1.1 million or diluted earnings per share of $0.83 for the nine
month period ended March 31, 2002, a 3.9% decrease in net earnings, period to
period.
The decrease in net earnings for the current quarter was due primarily to a
decrease in net interest income, which decreased $83,000 or 8.6%. Interest
income decreased $319,000 or 13.2% to $2.1 million for the three month period
ended March 31, 2003, compared to the prior year period, which was not fully
offset by a $236,000 or 16.2% decrease in interest expense. Interest expense was
$1.2 million for the quarter ended March 31, 2003, compared to $1.5 million for
the 2002 quarter. As has been the case for some months, historically low market
interest rates have resulted in lower returns on the bank's assets. While costs
of liabilities have decreased as well, returns on assets have decreased at a
significantly faster pace, especially as borrowers have chosen to refinance
higher rate loans. General, administrative and other expense decreased $16,000
or 3.5% from period to period, primarily as a result of a decrease in employee
compensation and benefits.
The decrease in net earnings for the nine month period ended March 31, 2003
is attributable to the same factors identified for the quarter then ended. Net
interest income decreased $116,000 or 4.0% from period to period, while general,
administrative and other expense decreased $39,000 or 3.0%, primarily as a
result of a decrease in employee compensation and benefits.
At March 31, 2003 the Company reported its book value per share as $14.47
compared to $14.50 at June 30, 2002.
In addition to historical information, the preceding discussion may contain
forward-looking statements that involve risk and uncertainties. Economic
circumstances, the Company's operations, and the Company's actual results could
differ significantly from those discussed in the forward-looking statements.
First Federal Savings Bank of Frankfort operates three offices in
Frankfort, Kentucky. Frankfort First Bancorp, Inc. shares are traded on the
Nasdaq National Market under the symbol FKKY. At March 31, 2003 the Company had
approximately 1,246,000 shares outstanding.
SUMMARY OF FINANCIAL HIGHLIGHTS
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
March 31, June 30,
2003 2002
(In thousands, except per share data)
(Unaudited) (Audited)
Assets
Cash and Cash Equivalents $ 9,090 $ 4,812
Investment Securities 3,100 100
Loans Receivable, net 122,241 131,180
Other Assets 4,578 4,865
---------- ----------
Total Assets $ 139,009 $ 140,957
========== ==========
Liabilities
Deposits $ 76,230 $ 75,896
FHLB Advances 43,299 44,982
Other Liabilities 1,450 2,014
---------- ----------
Total Liabilities 120,979 122,892
Shareholders' Equity 18,030 18,065
---------- ----------
Total Liabilities and Equity $ 139,009 $ 140,957
========== ==========
Book Value Per Share $ 14.47 $ 14.50
========== ==========
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
Nine months ended March 31, Three months ended March 31,
2003 2002 2003 2002
(In thousands, except per share data)
(Unaudited)
Interest Income $ 6,592 $ 7,661 $ 2,095 $ 2,414
Interest Expense 3,834 4,787 1,217 1,453
-------- -------- -------- --------
Net Interest Income 2,758 2,874 878 961
Provision for Losses on Loans -- 1 -- --
Other Operating Income 55 42 11 11
General, Administrative, and Other Expense 1,276 1,315 445 461
-------- -------- -------- --------
Earnings Before Federal Income Taxes 1,537 1,600 444 511
Federal Income Taxes 523 545 151 178
-------- -------- -------- --------
Net Earnings $ 1,014 $ 1,055 $ 293 $ 333
======== ======== ======== ========
Basic Earnings Per Share $ 0.81 $ 0.85 $ 0.23 $ 0.27
Diluted Earnings Per Share $ 0.79 $ 0.83 $ 0.23 $ 0.26
Dividends Per Share $ 0.84 $ 0.84 $ 0.28 $ 0.28