Press Release
FedFirst Financial Corporation
Announces Second Quarter 2006 Earnings
MONESSEN, PA--July 31, 2006-- FedFirst Financial Corporation (NASDAQ
Capital: FFCO; the "Company"), the parent company of First Federal Savings
Bank, today announced net income of $150,000 for the quarter ended June 30,
2006 compared to net income of $293,000 for the quarter ended June 30, 2005.
Net income for the six months ended June 30, 2006 was $388,000 compared to
net income of $519,000 for the six months ended June 30, 2005. Basic and
diluted earnings per share were $0.02 and $0.05 for the quarters ended June
30, 2006 and 2005, respectively. Basic and diluted earnings per share for
the six months ended June 30, 2006 was $0.06. Earnings per share data for
the six months ended June 30, 2005 is not presented since the Company was
wholly owned by FedFirst Financial MHC prior to the completion of the initial
public offering on April 6, 2005.
Second Quarter Earnings
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Net interest income decreased $96,000, or 5.7%, to $1.6 million for the
quarter ended June 30, 2006 from $1.7 million for the same period last year.
Net interest spread and net interest margin were 2.02% and 2.52%, respectively,
for the quarter ended June 30, 2006 compared to 2.06% and 2.48%, respectively,
for the quarter ended June 30, 2005. Interest income decreased $37,000,
primarily as a result of the paydowns on investment securities. Interest
expense increased $59,000 due to an increase in the cost of funds from
promotional specials offered on certificates of deposit and replacement of
maturing lower cost FHLB advances during the first and second quarters of 2006.
Noninterest income increased $15,000 to $542,000 for the quarter ended
June 30, 2006 compared to the same period in 2005. The increase was
primarily attributable to a gain of $26,000 on the sale of a majority of the
student loan portfolio as well as a gain of $22,000 on the sale of real
estate owned. These gains were partially offset by a decrease of $32,000 in
insurance commission income.
Noninterest expense increased to $1.9 million for the quarter ended
June 30, 2006 compared to $1.8 million for the same period in 2005. The
increase was primarily a result of additional expenses associated with
operating as a public company as well as expenses related to the preparation
for the opening of our new branch in Peters Township. The new branch opened
on July 6, 2006.
Year to Date Earnings
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Net interest income totaled $3.1 million for the six months ended June
30, 2006 and 2005, respectively. Net interest spread and net interest margin
were 1.98% and 2.45%, respectively for the six months ended June 30, 2006
compared to 2.01% and 2.33%, respectively for the six months ended June 30,
2005.
Noninterest income increased to $1.3 million for the six months ended
June 30, 2006 compared to $1.2 million for the same period in 2005. The
increase was primarily due to gains of $33,000 on the sale of real estate
owned and $26,000 from the sale of a majority of the student loan portfolio.
The increase was also attributable to an overall increase of approximately
$28,000 in insurance commission income.
Noninterest expense increased to $3.7 million for the six months ended
June 30, 2006 compared to $3.5 million for the same period in 2005. As noted
above in the quarterly results, the increase was a result of additional
expenses associated with operating as a public company as well as expenses
related to the preparation for the opening of the new branch in Peters
Township.
Financial Condition
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Total assets were $267.8 million at June 30, 2006 compared to $276.1
million at December 31, 2005. The decline in total assets was primarily from
the paydown of securities and the sale of $1.2 million of student loans. The
funds from the paydown of securities in conjunction with the deposits
generated were utilized in part to reduce maturing FHLB advances during the
period. The deposit growth of $6.4 million from year end was focused in
short term certificates of deposit and was due in part to a continuation of a
dedicated sales culture to improve existing and create new relationships.
Mr. Robinson, President and Chief Executive Officer of the Company, stated,
"We remain encouraged by our ability to generate deposits within our existing
branch network and are very excited about the opportunity to show the Peters
Township community what it means to do business with First Federal".
FedFirst Financial Corporation is the parent company of First Federal
Savings Bank, a community-oriented financial institution operating eight
full-service branch locations in southwestern Pennsylvania. First Federal
offers a broad array of retail and commercial lending and deposit services
and provides 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-KSB
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.
FEDFIRST FINANCIAL CORPORATION
SELECTED FINANCIAL INFORMATION (Unaudited)
(In thousands, except share and per share data)
June 30, December 31,
2006 2005
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Selected Financial Condition Data:
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Total assets $ 267,751 $ 276,071
Cash and cash equivalents 5,949 6,332
Securities available-for-sale 68,844 77,947
Loans receivable, net 172,536 171,162
Deposits 131,300 124,897
Federal Home Loan Bank advances 87,648 102,404
Equity 45,251 45,295
Three Months Ended Six Months Ended
June 30, June 30,
2006 2005 2006 2005
---------- ---------- ---------- ----------
Selected Operations Data:
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Total interest income $ 3,400 $ 3,437 $ 6,722 $ 6,605
Total interest expense 1,803 1,744 3,586 3,505
---------- ---------- ---------- ----------
Net interest income 1,597 1,693 3,136 3,100
Provision for loan losses 20 25 40 25
---------- ---------- ---------- ----------
Net interest income after provision
for loan losses 1,577 1,668 3,096 3,075
Noninterest income 542 527 1,267 1,187
Noninterest expense 1,908 1,809 3,740 3,544
Minority interest in net income of
consolidated subsidiary 6 11 37 39
---------- ---------- ---------- ----------
Income before income taxes 205 375 586 679
Income tax 55 82 198 160
---------- ---------- ---------- ----------
Net income $ 150 $ 293 $ 388 $ 519
========== ========== ========== ==========
Earnings per share -
basic and diluted $ 0.02 $ 0.05 $ 0.06 N/A
Weighted average shares
outstanding - basic and diluted 6,377,051 5,937,082 6,374,891 N/A
Three Months Ended Six Months Ended
June 30, June 30,
2006 2005 2006 2005
---------- ---------- ---------- ----------
Selected Financial Ratios(1):
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Return on average assets 0.22 % 0.41 % 0.29 % 0.37 %
Return on average equity 1.32 2.67 1.71 3.22
Average interest-earning assets to
average interest-bearing liabilities 117.43 116.46 116.99 111.98
Average equity to average assets 16.94 15.28 16.76 11.45
Interest rate spread 2.02 2.06 1.98 2.01
Net interest margin 2.52 % 2.48 % 2.45 % 2.33 %
Period ended
June 30, December 31,
2006 2005
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Allowance for loan losses to total loans 0.48 % 0.46 %
Allowance for loan losses to nonperforming
loans 124.26 295.20
Nonperforming loans to total loans 0.38 % 0.16 %
(1) Three and six months ended ratios are calculated on an annualized basis.
NOTE:
Certain items previously reported may have been reclassified to conform with
the current reporting period's format.
Contact:
FedFirst Financial Corporation
John G. Robinson, 724-684-6800