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FIRST CAPITAL, INC. REPORTS SECOND QUARTER EARNINGS INCREASE
Corydon, Indiana--(BUSINESS WIRE)--July 21, 2005. First Capital, Inc. (NASDAQ:
FCAP - news), the holding company for First Harrison Bank (the "Bank"), today
reported net income of $872,000 or $0.34 per diluted share for the quarter ended
June 30, 2005, compared to $861,000 or $0.31 per diluted share during the same
period in 2004.
The increase in earnings is due to increases in net interest income after the
provision for loan loses and noninterest income, partially offset by an increase
in noninterest expense.
Net interest income after provision for loan losses increased $100,000 for the
quarter ended June 30, 2005 as compared to the quarter ended June 30, 2004.
Interest income increased $447,000 when comparing the two periods as the average
tax-equivalent yield of interest-earning assets increased from 5.65% during the
quarter ended June 30, 2004 to 5.89% for the same period in 2005. Interest
expense increased $304,000 as the average cost of interest-bearing liabilities
increased from 2.63% to 2.87% when comparing the same two periods. The provision
for loan losses increased $43,000 to a total of $163,000 for the three months
ended June 30, 2005.
Noninterest income increased $47,000 for the quarter ended June 30, 2005 as
compared to the quarter ended June 30, 2004. The primary factor in this increase
was gains on the sale of mortgage loans, which increased $42,000 when comparing
the two periods.
Noninterest expenses increased $143,000 as compared to the quarter ended June
30, 2004. Occupancy and equipment expense increased $40,000 when comparing the
quarters ended June 30, 2005 and June 30, 2004 primarily due to increased
depreciation and equipment maintenance charges. Other operating expenses
increased $45,000 during the quarter ended June 30, 2005 as compared to the same
period in the prior year primarily due to the donation of improved real estate
to Harrison County, Indiana for an access road adjacent to a branch.
For the six months ended June 30, 2005, the Company earned $1.7 million or $0.67
per diluted share compared to $1.7 million or $0.60 for the same period in 2004.
Net interest income after provision for loan loss increased $81,000 during the
first six months of 2005 compared to the same period in 2004. Interest income
increased $628,000 when comparing the two periods, due to an increase in the
average balance of interest-earning assets from $386.4 million during the first
six months of 2004 to $400.0 million for the same period in 2005 and an increase
in the average tax-equivalent yield on those assets from 5.71% to 5.83%.
Interest expense increased $479,000 as the average balance of interest-bearing
liabilities increased $14.2 million and the average cost of those liabilities
increased from 2.65% to 2.81% when comparing the two periods. The provision for
loan losses increased $68,000 when comparing the two periods.
Noninterest income increased $245,000 primarily due to increases in gains on the
sale of mortgage loans and service charges on deposits of $129,000 and $103,000,
respectively.
Noninterest expenses increased $295,000 when comparing the six months ended June
30, 2005 to the same period in 2004, primarily due to an increase of $106,000 in
compensation and benefits. Advertising expense increased $36,000 when comparing
the two periods as the Bank initiated a more aggressive marketing effort to
increase loans.
Total assets as of June 30, 2005 were $438.4 million compared to $425.3 million
at December 31, 2004. The primary factor behind the asset growth was an increase
of $11.5 million in securities available for sale. The funding for this growth
was provided by increases in retail repurchase agreements and deposits of $8.1
million and $7.9 million, respectively.
First Harrison Bank currently has twelve offices in the Indiana communities of
Corydon, Crandall, Georgetown, Greenville, Floyds Knobs, Hardinsburg, Palmyra,
New Albany, New Salisbury and Jeffersonville. Access to First Harrison Bank
accounts, including online banking and electronic bill payments, is available
anywhere with Internet access through the Bank's website at
www.firstharrison.com. First Harrison Financial Services, a subsidiary of the
Bank, offers a full array of property, casualty and life insurance products, as
well as non FDIC insured investments to compliment the Bank's offering of
traditional banking products and services.
This report may contain forward-looking statements within the meaning of the
federal securities laws. These statements are not historical facts, rather
statements based on the Company's current expectations regarding its
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business strategies and their intended results and its future performance.
Forward-looking statements are preceded by terms such as "expects," "believes,"
"anticipates," "intends" and similar expressions.
Forward-looking statements are not guarantees of future performance. Numerous
risks and uncertainties could cause or contribute to the Company's actual
results, performance and achievements to be materially different from those
expressed or implied by the forward-looking statements. Factors that may cause
or contribute to these differences include, without limitation, general economic
conditions, including changes in market interest rates and changes in monetary
and fiscal policies of the federal government; legislative and regulatory
changes; and other factors disclosed periodically in the Company's filings with
the Securities and Exchange Commission.
Because of the risks and uncertainties inherent in forward-looking statements,
readers are cautioned not to place undue reliance on them, whether included in
this report or made elsewhere from time to time by the Company or on its behalf.
Except as may be required by applicable law or regulation, the Company assumes
no obligation to update any forward-looking statements.
FIRST CAPITAL, INC. AND SUBSIDIARY
Consolidated Financial Highlights (Unaudited)
SIX MONTHS ENDED THREE MONTHS ENDED
JUNE 30, JUNE 30,
OPERATING DATA 2005 2004 2005 2004
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(Dollars in thousands, except per share data)
Total interest income $ 11,485 $ 10,857 $ 5,865 $ 5,418
Total interest expense 4,938 4,459 2,537 2,233
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Net interest income 6,547 6,398 3,328 3,185
Provision for loan losses 313 245 163 120
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Net interest income after provision for loan losses 6,234 6,153 3,165 3,065
Total non-interest income 1,541 1,296 755 708
Total non-interest expense 5,183 4,888 2,592 2,449
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Income before income taxes 2,592 2,561 1,328 1,324
Income tax expense 864 867 456 463
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Net income $ 1,728 $ 1,694 $ 872 $ 861
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Net income per common share, basic $ 0.67 $ 0.61 $ 0.34 $ 0.31
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Weighted average common shares outstanding - basic 2,565,333 2,774,654 2,566,197 2,773,463
Net income per common share, diluted $ 0.67 $ 0.60 $ 0.34 $ 0.31
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Weighted average common shares outstanding -diluted 2,592,113 2,810,700 2,591,954 2,809,951
OTHER FINANCIAL DATA
Cash dividends per share $ 0.15 $ 0.15 $ 0.30 $ 0.30
Return on average assets (annualized) 0.81% 0.83% 0.81% 0.82%
Return on average equity (annualized) 8.49% 7.80% 8.43% 7.67%
Net interest margin 3.38% 3.36% 3.36% 3.40%
Net overhead expense as a percentage
of average assets (annualized) 2.40% 2.35% 2.42% 2.37%
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JUNE 30, DECEMBER 31,
BALANCE SHEET INFORMATION 2005 2004
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Cash and cash equivalents $ 19,102 $ 17,425
Investment securities 77,945 66,450
Gross loans 318,271 319,564
Allowance for loan losses 2,110 2,478
Earning assets 400,067 390,948
Total assets 438,420 425,302
Deposits 324,353 316,462
FHLB debt 61,274 65,099
Repurchase agreements 8,710 635
Stockholders' equity 41,550 40,714
Non-performing assets:
Nonaccrual loans 1,193 2,075
Foreclosed real estate 647 442