FMS FINANCIAL CORPORATION
For Immediate Release
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October 24, 2005
For Further Information Contact: (609) 386-2400
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Craig W. Yates, President
Channing L. Smith, Vice President and Chief Financial Officer
FMS FINANCIAL REPORTS 3rd QUARTER EARNINGS
Burlington, New Jersey, (October 24, 2005) - FMS Financial Corporation, (NASDAQ
Symbol: "FMCO") today reported quarterly net income of $1,706,335 or $.26
diluted earnings per share for the quarter ended September 30, 2005 as compared
to net income of $2,508,133 or $.38 diluted earnings per share for the same
period in 2004. Earnings for the nine months ended September 30, 2005 were
$5,249,861 or $.80 diluted earnings per share as compared to net income of
$6,658,677 or $1.02 diluted earnings per share for the first nine months of
2004.
Net interest income after provision for loan losses totaled to $27.1 million for
the nine months ended September 30, 2005 compared to $27.6 million for the same
period in 2004. Total interest income increased to $42.9 million during the nine
months ended September 30, 2005 from $41.4 million for the same period in 2004.
Total interest expense increased to $15.5 million during the nine months ended
September 30, 2005 from $13.5 million for the same period in 2004.
Total assets were $1.2 billion and deposits totaled $951.4 million at September
30, 2005. Non-performing loans at September 30, 2005 amounted to $3.7 million or
0.83% of total loans. The allowance for loan losses was $5.0 million at
September 30, 2005 or 135% of non-performing loans. Core, tangible and
risk-based capital continue to exceed all regulatory requirements.
FMS Financial Corporation is the holding company for Farmers & Mechanics Bank
that operates forty-one banking offices in Burlington, Camden and Mercer
Counties, New Jersey.
FMS FINANCIAL CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
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Three Months ended Nine Months ended
September 30, September 30,
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2005 2004 2005 2004
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INTEREST INCOME:
Interest income on:
Loans $ 6,551,661 $ 6,219,024 $ 19,119,549 $ 18,329,907
Mortgage-backed securities 3,683,402 4,224,347 11,061,882 12,237,351
Investments 4,350,829 3,706,263 12,715,465 10,808,357
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Total interest income 14,585,892 14,149,634 42,896,896 41,375,615
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INTEREST EXPENSE:
Interest expense on:
Deposits 2,951,433 1,942,196 8,037,622 5,548,386
Borrowings 1,998,801 2,305,113 6,162,057 7,006,011
Long term debt 469,752 353,489 1,321,428 992,527
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Total interest expense 5,419,986 4,600,798 15,521,107 13,546,924
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NET INTEREST INCOME 9,165,906 9,548,836 27,375,789 27,828,691
PROVISION FOR LOAN LOSSES 90,000 90,000 270,000 240,000
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NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 9,075,906 9,458,836 27,105,789 27,588,691
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NON-INTEREST INCOME:
Loan service charges and other fees 15,454 21,384 56,625 80,560
Gain on sale of investment securities 0 433,518 0 533,574
Gain on sale of fixed assets 0 0 0 46,080
Real estate owned operations, net 0 (39) 0 (4,586)
Service charges on accounts 1,328,612 1,308,036 3,969,753 3,834,588
Other income 41,290 35,861 116,107 100,177
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Total non-interest income 1,385,356 1,798,760 4,142,485 4,590,393
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NON-INTEREST EXPENSE:
Salaries and employee benefits 4,534,246 4,209,679 13,369,108 12,409,459
Occupancy and equipment 1,405,837 1,361,072 4,227,445 4,043,164
Purchased services 685,900 699,781 2,084,823 2,144,793
Federal deposit insurance premiums 31,167 32,412 95,580 97,959
Professional fees 193,792 161,864 565,800 495,542
Advertising 109,814 106,565 323,057 322,591
Amortization of core deposit intangible 179,052 179,052 537,156 537,156
Other 444,909 319,439 1,158,840 1,020,789
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Total non-interest expenses 7,584,717 7,069,864 22,361,809 21,071,453
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INCOME BEFORE INCOME TAXES 2,876,545 4,187,732 8,886,465 11,107,631
INCOME TAXES 1,170,210 1,679,599 3,636,604 4,448,954
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NET INCOME $ 1,706,335 $ 2,508,133 $ 5,249,861 $ 6,658,677
============ ============ ============ ============
BASIC EARNINGS PER COMMON SHARE $ 0.26 $ 0.39 $ 0.81 $ 1.03
============ ============ ============ ============
DILUTED EARNINGS PER COMMON SHARE $ 0.26 $ 0.38 $ 0.80 $ 1.02
============ ============ ============ ============
Dividends declared per common share $ 0.03 $ 0.03 $ 0.09 $ 0.09
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Weighted average common shares outstanding 6,502,960 6,500,960 6,502,516 6,493,267
Potential dilutive effect of the exercise of stock options 33,173 36,763 35,397 38,020
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Adjusted weighted average common shares outstanding 6,536,133 6,537,723 6,537,913 6,531,287
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FMS FINANCIAL CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (Unaudited)
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September 30, 2005 December 31, 2004
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ASSETS
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Cash and amounts due from depository institutions $ 49,910,908 $ 46,410,744
Interest-bearing deposits 28,349 30,950
Short term funds 51,864,635 64,135,662
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Total cash and cash equivalents 101,803,892 110,577,356
Investment securities held to maturity 242,442,079 254,833,749
Investment securities available for sale 161,037,070 141,999,280
Mortgage-backed securities held to maturity 218,641,767 269,221,897
Loans, net 437,505,725 418,798,633
Accrued interest receivable 6,365,942 6,322,107
Federal Home Loan Bank stock 7,750,020 10,250,120
Office properties and equipment, net 31,291,304 30,747,227
Deferred income taxes 2,416,169 2,150,442
Core deposit intangible 2,054,874 2,592,030
Prepaid expenses and other assets 2,181,907 2,513,224
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TOTAL ASSETS $ 1,213,490,749 $ 1,250,006,065
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LIABILITIES AND STOCKHOLDERS' EQUITY
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Liabilities:
Deposits $ 951,356,203 $ 941,506,820
Securities sold under agreements to repurchase 155,000,000 195,000,000
Advances from the Federal Home Loan Bank 0 10,000,000
FMS Statutory Trust 1 debentures 25,774,000 25,774,000
Advances by borrowers for taxes and insurance 2,179,179 2,200,357
Accrued interest payable 1,152,093 1,246,661
Dividends payable 195,089 195,029
Other liabilities 3,553,710 3,746,579
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Total liabilities 1,139,210,274 1,179,669,446
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Commitments and contingencies
Stockholders' Equity:
Preferred stock - $.10 par value 5,000,000 shares authorized; none issued
Common stock - $.10 par value 10,000,000 shares authorized; shares
issued 7,992,142 and 7,991,292 and shares outstanding 6,502,960
and 6,502,110 as of September 30, 2005 and December 31, 2004, respectively 799,214 799,129
Paid-in capital in excess of par 8,688,136 8,555,506
Accumulated other comprehensive income - net of income taxes (582,669) 270,784
Retained earnings 76,310,793 71,646,199
Less: Treasury stock (1,489,182 shares, at cost, as of September 30, 2005
and December 31, 2004, respectively) (10,934,999) (10,934,999)
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Total stockholders' equity 74,280,475 70,336,619
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,213,490,749 $ 1,250,006,065
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