SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
July 26, 1999
CLASSIC BANCSHARES, INC.
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(Exact name of Registrant as specified in its Charter)
Delaware 0-27170 61-1289391
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(State or other jurisdiction (Commission File No.) (IRS Employer Identification
of incorporation) No.)
344 17th Street, Ashland, Kentucky 41101
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (606) 325-4789
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N/A
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(Former name or former address, if changed since last report)
Item 5. Other Events
On July 26, 1999, the Registrant issued the press release attached hereto
as Exhibit 99 announcing its earnings for the quarter ended June 30, 1999 and
the declaration of a cash dividend.
Item 7. Financial Statements and Exhibits
(c) Exhibits
99 Press release dated July 26, 1999.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned thereunto duly authorized.
CLASSIC BANCSHARES, INC.
Date: August 9, 1999 By: /s/Lisah M. Frazier
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Lisah M. Frazier, Senior Vice
President, Treasurer and Chief
Financial Officer
EXHIBIT 99
FOR IMMEDIATE RELEASE
For Additional Information Contact:
David B. Barbour, President and Chief Executive Officer
Lisah Frazier, Senior Vice President, Treasurer and Chief Financial Officer
(606) 325-4789
Fax (606) 324-1307
CLASSIC BANCSHARES, INC. REPORTS A 31% INCREASE IN EARNINGS PER SHARE
AND DECLARES A CASH DIVIDEND
Ashland, Kentucky, -- July 26, 1999 -- Classic Bancshares, Inc. (NASDAQ
- - CLAS) reported cash-based net income (which excludes amortization of goodwill)
of $298,000 for the first quarter ended June 30, 1999 compared to cash-based net
income of $228,000 for the same period in 1998. Cash-based diluted earnings per
share were $.25 for the three months ended June 30, 1999 compared to $.18 for
the same period in 1998. Cash return on average assets was .8% for the three
months ended June 30, 1999.
Net income for the first quarter ended June 30, 1999 was $252,000, or
$.21 per diluted share compared to $197,000, or $.16 per diluted share for the
same period in 1998. Return on average assets was .6% for the quarter ended June
30, 1999 and 1998.
Classic Bancshares' assets increased $22.3 million from $142.7 million
at March 31, 1999 to $165.0 million at June 30, 1999. The primary factor in this
growth was due to the acquisition of Citizens Bank, Grayson on May 14, 1999. At
the close of the transaction, Citizens Bank, Grayson was merged with and into
Classic Bank with Classic Bank as the surviving institution. The transaction was
valued at $4.5 million and was accounted for under the purchase method of
accounting. As a result, assets and liabilities are consolidated as of the
balance sheet date and earnings are consolidated from the date of acquisition.
Therefore, earnings of Citizens are reflected in the results for the quarter as
of May 14, 1999. On the date of closing, Citizens had total assets of
approximately $13.4 million and total deposits of $12.0 million. In connection
with the acquisition, the Company recorded $3.1 million in goodwill.
Loans increased $17.9 million from $97.5 million at March 31, 1999 to
$115.4 million at June 30, 1999 with $9.0 million of the increase attributable
to the acquisition of Citizens. The remainder of the increase is the result of
aggressive origination efforts and continued loan demand within the Company's
market areas. Deposits increased $21.6 million from $117.7 million at March 31,
1999 to $139.3 million at June 30, 1999 with $12.0 million of the increase
attributable to the acquisition of Citizens. The remainder of the increase is
the result of aggressive marketing efforts and the opening of two additional
banking offices during fiscal 1999.
Asset quality remained stable as total non-performing assets was .7% of
total assets at March 31, 1999 and June 30, 1999. The Company recorded a
provision for loan losses of $35,000 in the current quarter and recorded an
allowance of $506,000 from the acquisition of Citizens resulting in an allowance
for loan losses of $1.2 million at June 30, 1999 equal to 141% of total
non-performing loans, and 1.1% of total loans receivable.
President and Chief Executive Officer, David B. Barbour stated that,
"The results for our first quarter reflects continued positive trends as we see
the realization of our internal growth strategy resulting in two additional
banking offices, an aggressive ATM deployment and implementation of our
transactional internet banking product. We are also pleased to report the
successful completion of the acquisition of Citizens Bank, Grayson during this
quarter which added approximately $13.0 million in assets to the franchise, as
well as strategically locating another banking office in an important and
growing market area."
Net interest income increased $215,000 to $1.4 million for the first
quarter ended June 30, 1999 compared to $1.2 million for the first quarter ended
June 30, 1998. The net interest margin increased to 4.1% for the quarter ended
June 30, 1999 compared to 3.8% for the same period in 1998. The increase was due
to the combination of the continued increase in higher yielding, non-residential
loans, such as commercial and consumer loans and a reduction in the cost of
deposits through the continued increase in non-certificated accounts.
Non-interest income was $191,000 for the quarter ended June 30, 1999
compared to $145,000 for the quarter ended June 30, 1998. Non-interest income
increased for the quarter primarily due to an increase in fees and service
charges on deposit accounts. The increase in fees and service charges on
deposits is the result of increased product offerings, an increased deposit base
and aggressive pricing strategies.
Non-interest expense for the quarter ended June 30, 1999 was $1.2
million compared to $1.0 million for the quarter ended June 30, 1998.
Non-interest expenses increased for the quarter due primarily to the increased
costs related to an additional banking office as a result of the acquisition of
Citizens and an increase in goodwill amortization from the acquisition of
Citizens. Non-interest expenses also increased due to an increase in the
employee salaries and benefits due to an increase in the net number of employees
and other general and administrative expenses in order to facilitate the growth
of the Company.
Stockholders' equity was $19.4 million at June 30, 1999 compared to
$20.3 million at March 31, 1999.
Classic Bancshares, Inc. also announced that the Company will pay a
quarterly cash dividend of $.08 per share. The dividend will be payable on
August 23, 1999 to shareholders of record on August 9, 1999.
Classic Bancshares, Inc. is headquartered in Ashland, Kentucky and has
two subsidiaries, Classic Bank and First National Bank of Paintsville. Classic
Bank operates at 344 Seventeenth Street, Ashland, Kentucky with three branch
offices located in Boyd, Greenup and Carter counties. First National Bank of
Paintsville operates at 240 Main Street, Paintsville, Kentucky with one branch
office located in Johnson County.
When used in this press release, the words or phrases "should result,"
"will likely result", "are expected to", "will continue", "is anticipated",
"estimate", "project" or similar expressions are intended to identify
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements are subject to certain risks and
uncertainties, including changes in economic condition in the Company's market
area, changes in policies by regulatory agencies, fluctuations in interest
rates, demand for loans in the Company's market area and competition, that could
cause actual results to differ materially from historical earnings and those
presently anticipated or projected. The Company wishes to caution readers not to
place undue reliance on such forward-looking statements, which speak only as of
the date made. The Company wishes to advise readers that the factors listed
could affect the Company's financial performance and could cause the Company's
actual results for future periods to differ materially from any opinions or
statements expressed with respect to future periods in any current statements.
The Company does not undertake-and specifically declines any
obligation-to publicly release the result of any revisions which may be made to
any forward-looking statements to reflect events or circumstances after the date
of such statements or to reflect the occurrence of anticipated or unanticipated
events.
SELECTED FINANCIAL AND OTHER DATA
The following table sets forth selected financial data of Classic
Bancshares, Inc. as of June 30, 1999 and March 31, 1999 and for the three months
ended June 30, 1999 and 1998.
June 30, March 31,
1999 1999
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(In Thousands)
SELECTED FINANCIAL CONDITION DATA:
Total Assets $ 165,030 $ 142,739
Cash and other interest bearing deposits
With other financial institutions
5,026 4,486
Loans receivable, net
115,352 97,527
Investment securities:
Available for sale
26,917 26,526
Mortgage-backed securities:
Available for sale
4,046 4,479
Goodwill
5,879 2,779
Deposits 117,732
139,264
Federal funds purchased and securities sold under
Agreement to repurchase
2,151 2,817
FHLB advances
1,604 388
Stockholders' Equity, subject to certain restrictions
19,413 20,289
Three Months Ended
JUNE 30,
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1999 1998
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(In Thousands)
SELECTED OPERATIONS DATA:
Total interest income $ 2,699 $ 2,415
Total interest expense
1,296 1,227
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Net interest income
1,403 1,188
Provision for losses on loans
35 25
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Net interest income after provision
For losses on loans
1,368 1,163
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Fees and service charges
149 108
Gain on sale of mortgage-backed & other securities
- 1
Other noninterest income
42 36
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Total noninterest income
191 145
Total noninterest expense
1,239 1,046
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Income before income taxes
320 262
Income tax expense
68 65
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Net income $ 252 $ 197
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Cash-based net income (excludes amortization of
goodwill) $ 298 $ 228
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At or for the Three Months Ended
JUNE 30,
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1999 1998
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OTHER DATA:
Return on average assets (ratio of net
income to total average assets)* .6% .6%
Return on average equity (ratio of net
income to total average assets)* 5.1 3.9
Net interest margin** 4.1 3.8
Non-performing assets to total assets .7 .3
Allowance for loan losses to non-
performing loans 141.3 687.75
Equity to total assets at end of period 11.8 14.8
Efficiency ratio*** 77.7 80.1
Basic earnings per share $0.22 $0.17
Cash-based basic earnings per share $0.26 $0.19
Fully diluted earnings per share $0.21 $0.16
Cash-based fully diluted earnings per share $0.25 $0.18
Book value per share $15.75 $15.60
Tangible book value per share $10.98 $13.38
Number of full service offices 5 5
Number of ATM locations 14 7
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* Annualized
** Net interest income annualized divided by average-earning assets.
*** Non-interest expenses divided by the total of net interest income and
non-interest income.