PHSB Financial Corporation Contact: James P. Wetzel, Jr.
Beaver Falls, Pennsylvania President and Chief Executive Officer
Richard E. Canonge
Chief Financial Officer
(724) 846-7300
FOR IMMEDIATE RELEASE
July 14, 2004
PHSB FINANCIAL CORPORATION
ANNOUNCES JUNE 30, 2004 OPERATING RESULTS
Beaver Falls, Pennsylvania (Nasdaq National Market - "PHSB") PHSB Financial
Corporation (the "Company"), announced today operating results for the six
months ended June 30, 2004. Net income for the six months ended June 30, 2004
was $1,556,000, or $.58 basic and $.55 diluted earnings per share, compared to
$1,318,000 or $.49 basic and $.47 diluted earnings per share, for the six months
ended June 30, 2003. Net interest income decreased by $336,000 or 7.2%. This
decrease was more than offset by an increase in gains on sales of securities
from $543,000 for the six months ended June 30, 2003 to $1,279,000 for the six
months ended June 30, 2004.
Total assets at June 30, 2004 of $323.0 million represented a decrease
of $17.0 million or 5.0% from December 31, 2003. This decrease was primarily due
to a decrease in loans of $22.1 million. The decrease in the loan portfolio was
primarily attributable to the maturity of loans to local school districts on
June 30, 2004. The Company anticipates that during the third quarter, a majority
of these school districts will borrow funds for their next fiscal year from the
Company. This decrease was partially offset by an increase in securities of $2.9
million.
The Company's wholly owned subsidiary, Peoples Home Savings Bank,
operates through its administrative office and ten full service offices in
Beaver and Lawrence Counties, Pennsylvania.
Statements contained in this news release, which are not historical
facts, are forward-looking statements as that term is defined in the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements are
subject to risks and uncertainties which could cause actual results to differ
materially from those currently anticipated due to a number of factors, which
include, but are not limited to, factors discussed in documents filed by the
Company with the Securities and Exchange Commission from time to time.
PHSB FINANCIAL CORPORATION
CONSOLIDATED BALANCE SHEET (UNAUDITED)
June 30, December 31,
2004 2003
----------------- -----------------
ASSETS
Cash and amounts due from other institutions $ 6,091,858 $ 6,795,068
Interest-bearing deposits with other institutions 1,744,840 753,727
----------------- -----------------
Cash and cash equivalents 7,836,698 7,548,795
Investment securities:
Available for sale 41,583,201 28,718,832
Held to maturity (market value $ 6,856,088
and $8,203,053) 6,722,392 7,952,211
Mortgage - backed securities:
Available for sale 78,309,876 75,910,915
Held to maturity (market value $ 44,302,109
and $56,194,217) 44,694,108 55,843,363
Loans (net of allowance for loan losses of $1,590,230
and $1,647,886) 131,503,422 153,584,123
Accrued interest receivable 1,308,554 1,573,295
Premises and equipment 4,094,732 4,227,498
Federal Home Loan Bank stock 3,723,700 3,606,600
Other assets 3,226,570 1,003,979
----------------- -----------------
TOTAL ASSETS $ 323,003,253 $ 339,969,611
================= =================
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits $ 220,987,454 $ 231,519,432
Advances from Federal Home Loan Bank 54,130,000 58,880,000
Accrued interest payable and other liabilities 2,460,562 2,920,291
----------------- -----------------
Total liabilities 277,578,016 293,319,723
----------------- -----------------
Preferred stock, 20,000,000 shares authorized, none issued - -
Common stock, $.10 par value 80,000,000 shares authorized,
3,519,711 shares issued 351,971 351,971
Additional paid in capital 32,877,508 32,750,510
Retained earnings - substantially restricted 24,251,306 23,857,117
Accumulated other comprehensive income (loss) (457,702) 1,540,849
Unallocated ESOP shares (178,829 and 190,751 shares) (1,896,725) (2,023,187)
Unallocated RSP shares (25,300 and 33,440 shares) (392,403) (518,654)
Treasury stock, at cost ( 616,358 shares) (9,308,718) (9,308,718)
----------------- -----------------
Total stockholders' equity 45,425,237 46,649,888
----------------- -----------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 323,003,253 $ 339,969,611
================= =================
June 30 December 31,
2004 2003
----------------- -----------------
Other Financial Condition Data:
Stockholders' equity to total assets 14.06% 13.72%
Book value per share $ 15.65 $ 16.07
Non-performing assets $ 268,298 $ 401,874
Non-performing loans to total loans 0.20% 0.26%
PHSB FINANCIAL CORPORATION
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
Three Months Ended June 30, Six Months Ended June 30,
2004 2003 2004 2003
----------- ----------- ----------- -----------
INTEREST AND DIVIDEND INCOME
Loans:
Taxable $ 2,072,027 $ 2,506,679 $ 4,255,845 $ 5,106,914
Exempt from federal income tax 226,001 314,660 453,231 625,074
Investment securities:
Taxable 222,410 203,899 432,414 442,807
Exempt from federal income tax 55,831 149,640 129,311 338,236
Mortgage - backed securities 1,444,314 1,280,670 2,912,843 2,721,329
Interest - bearing deposits with other institutions 8,189 16,068 17,684 26,237
----------- ----------- ----------- -----------
Total interest and dividend income 4,028,772 4,471,616 8,201,328 9,260,597
----------- ----------- ----------- -----------
INTEREST EXPENSE
Deposits 1,203,110 1,555,383 2,445,147 3,156,830
Advances from Federal Home Loan Bank 713,005 717,378 1,442,293 1,454,219
----------- ----------- ----------- -----------
Total interest expense 1,916,115 2,272,761 3,887,440 4,611,049
----------- ----------- ----------- -----------
Net interest income 2,112,657 2,198,855 4,313,888 4,649,548
PROVISION FOR LOAN LOSSES 90,000 180,000 210,000 370,000
----------- ----------- ----------- -----------
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 2,022,657 2,018,855 4,103,888 4,279,548
----------- ----------- ----------- -----------
NONINTEREST INCOME
Service charges on deposit accounts 195,141 184,083 379,478 344,303
Investment securities gains, net 474,799 366,820 1,278,961 542,964
Rental income, net 20,800 25,500 46,820 51,000
Other income 50,864 68,206 89,326 136,587
----------- ----------- ----------- -----------
Total noninterest income 741,604 644,609 1,794,585 1,074,854
----------- ----------- ----------- -----------
NONINTEREST EXPENSE
Compensation and employee benefits 1,062,261 1,016,776 2,183,032 2,080,787
Occupancy and equipment costs 310,453 309,265 655,178 668,183
Data processing costs 43,716 50,657 86,361 98,667
Other expenses 399,189 434,307 807,372 836,482
----------- ----------- ----------- -----------
Total noninterest expense 1,815,619 1,811,005 3,731,943 3,684,119
----------- ----------- ----------- -----------
Income before income taxes 948,642 852,459 2,166,530 1,670,283
Income taxes 245,000 186,554 611,000 352,554
----------- ----------- ----------- -----------
NET INCOME $ 703,642 $ 665,905 $ 1,555,530 $ 1,317,729
=========== =========== =========== ===========
Earnings Per Share
Basic $ 0.26 $ 0.25 $ 0.58 $ 0.49
Diluted $ 0.25 $ 0.24 $ 0.55 $ 0.47
Weighted average number of shares outstanding
Basic 2,692,647 2,671,320 2,687,631 2,708,768
Diluted 2,802,394 2,757,061 2,804,123 2,784,040
Financial ratios (annualized)
Return on average assets 0.82% 0.78% 0.91% 0.77%
Return on average equity 6.12% 5.64% 6.70% 5.52%
Net interest margin 2.54% 2.65% 2.59% 2.79%
OTHER DATA IN THOUSANDS
AVERAGE ASSETS 341,580 339,373 340,568 340,915
AVERAGE EQUITY 45,963 47,200 46,426 47,771
AVERAGE EARNING ASSETS 332,964 332,212 332,671 333,732