NEWS RELEASE
Contact: Paul S. Feeley For Release: Immediately
SENIOR VICE PRESIDENT, TREASURER &
CHIEF FINANCIAL OFFICER
(617) 628-4000
CENTRAL BANCORP REPORTS
IMPROVED QUARTERLY EARNINGS
SOMERVILLE, MASSACHUSETTS, August 3, 2005 - Central Bancorp, Inc.
(NASDAQ:CEBK) today reported that its net income improved more than 55% to
$706,000, or $.49 per diluted share, for the quarter ended June 30, 2005, from
$454,000, or $.29 per diluted share, for the corresponding quarter in the prior
fiscal year.
A $452,000 increase in net interest and dividend income was the
principal reason for the earnings improvement. This increase is reflective of
the $37.8 million increase in average loans over the prior year comparable
period along with a 13 basis point increase in net interest margin for the same
period. Part of the reason for the margin improvement was the shift in the mix
of interest-earning assets from short-term investments that carry a lower
interest yield to loans and investment securities which typically have higher
yields.
Central Bancorp's Chairman, President & Chief Executive Officer, John
D. Doherty, commented, "We are very pleased with the positive results we
reported for the first quarter of our current fiscal year, especially in view of
the competitive banking environment and the uncertain economic climate. At June
30, 2005, our assets of nearly $532 million, our loans of over $402 million and
our deposits of more than $339 million were all at record levels; and our
stockholders' equity improved to over $39 million at June 30, 2005. Book value
per share increased to $24.67 from $24.07 during the quarter. Asset quality
continues to be outstanding with only one non-performing loan with a balance of
$120 thousand.
"As we recently announced, the Board of Directors increased the
quarterly dividend by 50%, to $.18 per share, for payment on August 19 to
holders of record as of August 5. Based on the closing price on the date of the
announcement, the dividend yield was 2.72%."
(CONTINUED)
CENTRAL BANCORP, INC.
PAGE 2 OF 3
Central Bancorp, Inc. is the holding company for Central Bank, whose
legal name is Central Co-operative Bank, a Massachusetts-chartered co-operative
bank operating eight full service banking offices, a limited service high school
branch in suburban Boston and a stand alone 24-hour automated teller machine in
Somerville.
(SEE ACCOMPANYING TABLES.)
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THIS PRESS RELEASE MAY CONTAIN CERTAIN FORWARD-LOOKING STATEMENTS, WHICH ARE
BASED ON MANAGEMENT'S CURRENT EXPECTATIONS REGARDING ECONOMIC, LEGISLATIVE AND
REGULATORY ISSUES THAT MAY IMPACT THE COMPANY'S EARNINGS IN FUTURE PERIODS.
FACTORS THAT COULD CAUSE FUTURE RESULTS TO VARY MATERIALLY FROM CURRENT
MANAGEMENT EXPECTATIONS INCLUDE, BUT ARE NOT LIMITED TO, GENERAL ECONOMIC
CONDITIONS, CHANGES IN INTEREST RATES, DEPOSIT FLOWS, REAL ESTATE VALUES AND
COMPETITION; CHANGES IN ACCOUNTING PRINCIPLES, POLICIES OR GUIDELINES; CHANGES
IN LEGISLATION OR REGULATION; AND OTHER ECONOMIC, COMPETITIVE, GOVERNMENTAL,
REGULATORY AND TECHNOLOGICAL FACTORS AFFECTING THE COMPANY'S OPERATIONS,
PRICING, PRODUCTS AND SERVICES.
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CENTRAL BANCORP, INC.
PAGE 3 OF 3
CENTRAL BANCORP, INC.
CONSOLIDATED OPERATING DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)
Quarter Ended
June 30,
--------------------------------
2005 2004
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(Unaudited)
Net interest and dividend income $ 4,159 $ 3,707
Provision for loan losses 50 50
Net gain (loss) on sales and write-downs
of investment securities 117 134
Gain on sale of loans 55 63
Other non-interest income 322 251
Non-interest expenses 3,515 3,394
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Income before taxes 1,088 711
Provision for income taxes 382 257
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Net income $ 706 $ 454
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Earnings per share:
Basic $ .50 $ .29
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Diluted $ .49 $ .29
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Weighted average number of shares outstanding:
Basic 1,423 1,559
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Diluted 1,429 1,573
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CONSOLIDATED BALANCE SHEET DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)
JUNE 30, March 31,
2005 2005
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Total assets $ 531,863 $ 521,071
Investment securities available for sale 105,518 108,616
Total loans (1) 402,681 388,603
Allowance for loan losses 3,731 3,681
Deposits 339,488 333,215
Borrowings 144,624 141,197
Subordinated debenture 5,258 5,258
Stockholders' equity 39,223 38,239
Book value per share 24.67 24.07
(1) Includes loans held for sale of $2,935 and $2,221 at June 30, 2005 and
March 31, 2005, respectively.