Frankfort First Bancorp, Inc.
For Immediate Release October 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. RELEASES EARNINGS
Frankfort First Bancorp, Inc. (Nasdaq: FKKY), the holding company for First
Federal Savings Bank of Frankfort, Kentucky, announced net earnings of $251,000
or $0.19 diluted earnings per share for the three month period ended September
30, 2003, compared to $374,000 or $0.29 diluted earnings per share for the three
month period ended September 30, 2002. This results in a 34.5% decrease in
diluted earnings per share for the period.
Net earnings decreased by $123,000 or 32.9% from period-to-period largely
due to a decrease in net interest income. Net interest income decreased by
$181,000 or 18.6% for the 2003 three month period compared to fiscal 2002. Net
interest income was affected by historically low market interest rates that
continued to have radical effects on the Company's loan portfolio, which
included accelerated prepayments, borrowers refinancing for lower rates, and
downward adjustment of adjustable rate mortgages. These market factors led to
reductions in both volume and rate in the Company's loan portfolio, as interest
income from loans and other investments declined from $2.3 million for the three
month period ended September 30, 2002, to $2.0 million for the 2003 quarter, a
reduction of $338,000, or 14.7%. While rates paid on interest-bearing
liabilities decreased as well and interest expense decreased from $1.3 million
in 2002 to $1.2 million in 2003, a decrease of $157,000 or 11.8%, the reduction
in interest income was significantly greater thus resulting in the decline in
net interest income.
At September 30, 2003, the Company reported its book value per share as
$14.23 compared to $14.35 at June 30, 2003.
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 September 30, 2003 the Company
had approximately 1,257,000 shares outstanding.
SUMMARY OF FINANCIAL HIGHLIGHTS
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
September 30, June 30,
2003 2003
---- ----
(In thousands, except per share data)
(Unaudited) (Audited)
Assets
Cash and Cash Equivalents $ 2,255 $ 2,028
Investment Securities 6,668 7,097
Loans Receivable, net 125,092 124,596
Other Assets 4,596 4,615
--------------- ------------
Total Assets $ 138,611 $ 138,336
=============== ============
Liabilities
Deposits $ 76,092 $ 75,622
FHLB Advances 42,649 43,017
Other Liabilities 1,993 1,699
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Total Liabilities 120,734 120,338
Shareholders' Equity 17,877 17,998
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Total Liabilities and Equity $ 138,611 $ 138,336
=============== ============
Book Value Per Share $ 14.23 $ 14.35
=============== ============
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
Three months ended September 30,
2003 2002
---- ----
(In thousands, except per share data)
(Unaudited)
Interest Income $ 1,963 $ 2,301
Interest Expense 1,172 1,329
--------------- ------------
Net Interest Income 791 972
Provision for Losses on Loans -- --
Other Operating Income 12 20
General, Administrative, and Other Expense 423 421
--------------- ------------
Earnings Before Federal Income Taxes 380 571
Federal Income Taxes 129 197
--------------- ------------
Net Earnings $ 251 $ 374
=============== ============
Basic Earnings Per Share $ 0.20 $ 0.30
Diluted Earnings Per Share $ 0.19 $ 0.29
Dividends Per Share $ 0.28 $ 0.28