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PRESS RELEASE FOR IMMEDIATE RELEASE
Contact: Peter D. Griffith
Telephone: (724) 684-6800
FEDFIRST FINANCIAL CORPORATION
ANNOUNCES SECOND QUARTER 2005 EARNINGS
MONESSEN, PA--July 29, 2005-- FedFirst Financial Corporation (NASDAQ
SmallCap: FFCO; the "Company"), the parent company of First Federal Savings
Bank, today announced net income of $293,000 for the quarter ended June 30, 2005
compared to net income of $220,000 for the quarter ended June 30, 2004. Net
income for the six month period ended June 30, 2005 was $519,000 compared to
$396,000 for the six month period ended June 30, 2004.
Net interest income increased $542,000, or 47.1%, to $1.7 million for
the quarter ended June 30, 2005 from $1.2 million for the same period last year.
The increase in net interest income was a result of an increase in the net
interest spread and the net interest margin to 2.06 % and 2.48 %, respectively,
for the quarter ended June 30, 2005 compared to 1.38% and 1.51%, respectively,
for the quarter ended June 30, 2004. The overall improvement is primarily
attributable to a balance sheet restructuring in November 2004, which included
the prepayment of $33.5 million of FHLB advances having a weighted average
interest rate of 5.43%. The provision for loan losses for the quarter ended June
30, 2005 was $25,000 compared with $59,000 for the quarter ended June 30, 2004.
Noninterest income decreased to $527,000 for the quarter ended June 30,
2005 compared to $655,000 for the same period in 2004. This decline was
primarily the result of a decrease of $137,000 in insurance commission income
from Exchange Underwriters, Inc., a subsidiary of the Company.
Noninterest expense increased to $1.8 million for the quarter ended
June 30, 2005 compared to $1.4 million for the same period in 2004. During the
2004 period, a post-retirement health plan was terminated, resulting in the
recovery of $247,000 of previously accrued expenses. Most of the remaining
increase in noninterest expense resulted from the establishment of an Employee
Stock Ownership Plan (ESOP) and expenses associated with being a public company.
Net interest income for the six months ended June 30, 2005 totaled $3.1
million compared to $2.4 million for the prior year period. The increase in net
interest income was primarily a result of an increase in the net interest spread
and the net interest margin to 2.01% and 2.33%, respectively, for the six month
period ended June 30, 2005 compared to 1.46% and 1.58%, respectively, for the
six month period ended June 30, 2004.
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Noninterest income decreased to $1.2 million for the six months ended
June 30, 2005 compared to $1.3 million for the same period in 2004. The decrease
was primarily from the change in net (loss) gain on sales of securities. The
Company incurred a loss of $1,000 in the current six month period compared to
net gains of $54,000 for the six months ended June 30, 2004.
Noninterest expense increased to $3.5 million for the six months ended
June 30, 2005 compared to $3.1 million for the same period in 2004.
Total assets were $285.8 million at June 30, 2005 compared to $270.3
million at December 31, 2004. The growth in total assets for the period was
primarily due to an increase in net loans receivable of $13.0 million that
resulted from the purchase of approximately $11.6 million of residential
mortgage loans.
During the second quarter of 2005 the Company completed an initial
public offering of 2,975,625 shares of common stock to eligible depositors and
borrowers, and trading under the symbol "FFCO" commenced April 7, 2005 on the
NASDAQ SmallCap market. The increase in equity from $20.0 million at December
31, 2004 to $46.6 million at June 30, 2005 was primarily due to the initial
public offering. In his announcement of earnings, Peter D. Griffith, President
and Chief Executive Officer of the Company, stated, "We are pleased with the
progress we are making implementing our strategic plan and the board and
management are excited about the opportunities we now have to better serve both
new and existing customers."
FedFirst Financial Corporation is the parent company of First Federal
Savings Bank, a community-oriented financial institution operating seven
full-service branch locations in southwestern Pennsylvania offering a broad
array of retail and commercial lending and deposit services and providing
commercial and personal insurance services through Exchange Underwriters, Inc.,
its 80% owned subsidiary. Financial highlights of the Company are attached.
* * * * *
Statements contained in this news release that are not historical facts
may constitute forward-looking statements as that term is defined in the Private
Securities Litigation Reform Act of 1995 and such forward-looking statements are
subject to significant risks and uncertainties. The Company intends such
forward-looking statements to be covered by the safe harbor provisions contained
in the Act. The Company's ability to predict results or the actual effect of
future plans or strategies is inherently uncertain. Factors which could have a
material adverse effect on the operations and future prospects of the Company
and its subsidiaries include, but are not limited to, changes in market interest
rates, general economic conditions, changes in federal and state regulation,
actions by our competitors, loan delinquency rates and our ability to control
costs and expenses and other factors that may be described in the Company's
annual report on Form 10-K as filed with the Securities and Exchange Commission.
These risks and uncertainties should be considered in evaluating forward-looking
statements and undue reliance should not be placed on such statements.
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FEDFIRST FINANCIAL CORPORATION
SELECTED FINANCIAL INFORMATION (UNAUDITED)
(In thousands) JUNE 30, DECEMBER 31,
2005 2004
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SELECTED FINANCIAL CONDITION DATA:
- ---------------------------------
Total assets $ 285,829 $ 270,325
Cash and cash equivalents 9,878 6,715
Securities available-for-sale 85,254 86,307
Loans receivable, net 169,666 156,708
Deposits 130,667 137,389
Federal Home Loan Bank advances 105,193 110,416
Equity $ 46,557 $ 19,969
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2005 2004 2005 2004
------------ ----------- ------------ -----------
SELECTED OPERATIONS DATA:
- ------------------------
Total interest income $ 3,437 $ 3,489 $ 6,605 $ 7,133
Total interest expense 1,744 2,338 3,505 4,707
------------ ----------- ------------ -----------
Net interest income 1,693 1,151 3,100 2,426
Provision for loan losses 25 59 25 72
------------ ----------- ------------ -----------
Net interest income after provision for loan losses 1,668 1,092 3,075 2,354
Noninterest income 527 655 1,187 1,256
Noninterest expense 1,809 1,416 3,544 3,074
Minority interest in net income of consolidated subsidiary 11 26 39 34
------------ ----------- ------------ -----------
Income before income taxes 375 305 679 502
Income tax 82 85 160 106
------------ ----------- ------------ -----------
Net income $ 293 $ 220 $ 519 $ 396
============ =========== ============ ===========
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
2005 2004 2005 2004
------------ ----------- ------------ -----------
SELECTED FINANCIAL RATIOS(1):
Return on average assets 0.41 % 0.27 % 0.37 % 0.25 %
Return on average equity 2.67 4.05 3.21 3.60
Average interest-earning assets to average
interest-bearing liabilities 116.46 104.27 111.98 104.16
Average equity to average assets 15.28 6.77 11.45 6.80
Interest rate spread 2.06 1.38 2.01 1.46
Net interest margin 2.48 % 1.51 % 2.33 % 1.58 %
PERIOD ENDED
JUNE 30, DECEMBER 31,
2005 2004
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Allowance for loans losses to total loans 0.43 % 0.45 %
Allowance for loan losses to nonperforming loans 143.73 214.58
Nonperforming loans to total loans 0.30 % 0.21 %
(1) Quarterly and year to date ratios are calculated on an annualized basis.