News Release
------------
July 23, 2004 Contact: Dennis R. Stewart, EVP/CFO
FOR IMMEDIATE RELEASE (215) 579-4000
TF Financial Corporation Announces Second Quarter Results
And Quarterly Dividend
Newtown, Pennsylvania: TF Financial Corporation (Nasdaq National Market - THRD)
today reported net income of $1,656,000 ($0.58 per diluted share) for the second
quarter of 2004, compared with $436,000 ($0.16 per diluted share) during the
second quarter of 2003. Net income for the six month period ending June 30, 2004
is $3,265,000 ($1.15 per diluted share) compared with $1,215,000 ($0.45 per
diluted share) during the first six months of 2003. The Company also announced
that its Board of Directors declared a quarterly dividend of $0.17 per share,
payable August 16, 2004 to shareholders of record on August 6.
Highlights for 2004 include:
o Net income increased by 280% compared to the second quarter of 2003,
and increased by 2.9% compared to net income reported for the first
quarter of 2004.
o Net income increased by 169% for the first six months of 2004 compared
to the first six months of 2003.
o Diluted earnings per share for the second quarter of 2004 increased by
263% compared to the second quarter of 2003.
o Loans receivable have grown by 4.3% during the year.
o Total deposits have grown by 1.8% during the year.
o Net interest income during the second quarter of 2004 increased by 55%
compared with the second quarter of 2003.
o During the second quarter return on assets was 1.08%; return on equity
was 11.44%; and the net interest margin for the quarter was 3.92%.
"The team building that has been underway in the Bank, and the strategic
initiatives undertaken by the Company have combined to produce the third
consecutive quarter of record core earnings" noted Kent C. Lufkin, President and
CEO. "Our financial performance now rivals that of many of our top performing
peers."
TF Financial Corporation is a holding company whose principal subsidiary is
Third Federal Savings Bank, which operates 14 full service retail and commercial
banking offices in Philadelphia and Bucks County, Pennsylvania and in Mercer
County, New Jersey. In addition, the Bank's website can be found at
www.thirdfedbank.com.
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 TF Financial
Corporation with the Securities and Exchange Commission from time to time. The
Company does not undertake to update any forward-looking statement, whether
written or oral, that may be made from time to time by or on behalf of the
Company.
T F FINANCIAL CORPORATION
FINANCIAL INFORMATION
(dollars in thousands except per share data)
THREE MONTHS SIX MONTHS
------------ INC ---------- INC
6/30/04 6/30/03 (DEC) 6/30/04 6/30/03 (DEC)
------- ------- ----- ------- ------- -----
EARNINGS SUMMARY
Interest Income $ 7,775 $ 8,156 -4.7% $ 15,505 $ 16,813 -7.8%
Interest expense 2,151 4,525 -52.5% 4,303 9,348 -54.0%
Net interest income 5,624 3,631 54.9% 11,202 7,465 50.1%
Loan loss provision 150 90 66.7% 300 180 66.7%
Non-interest income 681 648 5.1% 1,390 1,732 -19.7%
Non-interest expense 3,869 3,599 7.5% 7,786 7,338 6.1%
Income taxes 630 154 309.1% 1,241 464 167.5%
Net income $ 1,656 $ 436 279.8% $ 3,265 $ 1,215 168.7%
PER SHARE INFORMATION
Earnings per share, basic (a) $ 0.62 $ 0.17 264.7% $ 1.23 $ 0.49 151.0%
Earnings per share, diluted (a) $ 0.58 $ 0.16 262.5% $ 1.15 $ 0.45 155.6%
Dividends paid $ 0.17 $ 0.15 13.3% $ 0.32 $ 0.30 6.7%
FINANCIAL RATIOS
Annualized return on average assets 1.08% 0.25% 332.0% 1.07% 0.34% 214.7%
Annualized return on average equity 11.44% 2.77% 313.0% 11.43% 3.88% 194.6%
Efficiency ratio 62.86% 85.92% -26.8% 63.34% 81.38% -22.2%
AVERAGE BALANCES
Loans $418,545 $363,906 15.0% $414,761 $365,226 13.6%
Mortgage-backed securities 132,144 172,259 -23.3% 131,400 167,985 -21.8%
Investment securities 30,111 76,608 -60.7% 30,282 66,670 -54.6%
Other interest-earning assets 1,648 64,376 -97.4% 1,609 79,297 -98.0%
Total earning assets 582,448 677,149 -14.0% 578,052 679,178 -14.9%
Non-earning assets 35,974 35,748 0.6% 36,133 35,356 2.2%
Total assets 618,422 712,897 -13.3% 614,185 714,534 -14.0%
Deposits 471,402 446,212 5.6% 468,073 444,459 5.3%
FHLB advances 82,984 197,249 -57.9% 83,149 200,619 -58.6%
Total interest bearing liabilities 554,386 643,461 -13.8% 551,222 645,078 -14.5%
Non-interest bearing liabilities 5,801 6,266 -7.4% 5,517 6,344 -13.0%
Stockholders' equity 58,235 63,170 -7.8% 57,446 63,112 -9.0%
Total liabilities & stockholders' $618,422 $712,897 -13.3% $614,185 $714,534 -14.0%
equity
SPREAD AND MARGIN ANALYSIS
Average yield on:
Loans 5.73% 6.20% 5.79% 6.45%
Mortgage-backed securities 4.66% 4.30% 4.57% 4.44%
Investment securities 4.46% 2.71% 4.40% 3.10%
Other interest-earning assets 0.98% 1.05% 0.87% 1.05%
Average cost of:
Deposits 1.26% 1.64% 1.28% 1.75%
FHLB advances 3.26% 5.49% 3.19% 5.51%
Interest rate spread 3.85% 2.01% 3.86% 2.07%
Net interest margin 3.92% 2.15% 3.93% 2.22%
THREE MONTHS SIX MONTHS
------------ INC ---------- INC
6/30/04 6/30/03 (DEC) 6/30/04 6/30/03 (DEC)
------- ------- ----- ------- ------- -----
NON-INTEREST INCOME
Retail banking fees $ 681 $ 569 19.7% $ 1,390 $ 1,147 21.2%
Gain (loss) on sales of securities - 79 -100.0% - 585 -100.0%
NON-INTEREST EXPENSE
Salaries and benefits 2,247 2,036 10.4% 4,521 4,060 11.4%
Occupancy 644 602 7.0% 1,239 1,230 0.7%
Deposit insurance 18 18 0.0% 36 37 -2.7%
Professional fees 132 158 -16.5% 338 318 6.3%
Deposit intangible amortization 40 48 -16.7% 80 96 -16.7%
Advertising 163 138 18.1% 326 275 18.5%
Other 625 599 4.3% 1,246 1,322 -5.7%
INC
6/30/04 12/31/03 (DEC)
------- -------- -----
DEPOSIT INFORMATION
Non-interest checking $ 30,816 $ 26,375 16.8%
Interest checking 53,848 52,647 2.3%
Money market 43,707 44,688 -2.2%
Savings 189,848 188,673 0.6%
CD's 149,533 146,960 1.8%
OTHER PERIOD ENDING INFORMATION
Per Share
Book value (a) $ 21.40 $ 21.37
Tangible book value (a) $ 19.68 $ 19.56
Closing market price $ 30.00 $ 34.20
Balance sheet
Loans,net $421,893 $ 404,649 4.3%
Cash and cash equivalents 6,467 8,241 -21.5%
Mortgage-backed securities 134,144 130,404 2.9%
Investment securities 31,316 31,802 -1.5%
Total assets 624,668 606,752 3.0%
FHLB advances and other 93,675 86,853 7.9%
Stockholders' equity 57,267 55,480 3.2%
ASSET QUALITY
Non-performing loans 2,054 2,282 -10.0%
Loan loss reserves 2,204 2,111 4.4%
Reserves to gross loans 0.52% 0.52% 0.0%
Non-performing loans to gross loans 0.48% 0.56% -14.3%
Non-performing loans to total assets 0.33% 0.38% -13.2%
Foreclosed property 837 868 -3.6%
Foreclosed property to total assets 0.13% 0.14% -7.1%
Non-performing assets to total assets 0.46% 0.52% -11.5%
OTHER STATISTICAL INFORMATION
Shares outstanding (000's) (a) 2,676 2,596
Number of branch offices 14 14
Full time equivalent employees 179 171
(a)excludes employee stock ownership plan shares.