DCB FINANCIAL CORP - 8-K Filing Date: 10/22/03
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EXHIBIT 99
FOR IMMEDIATE RELEASE CONTACT:
Wednesday October 22, 2003 John A. Ustaszewski
Chief Financial Officer
(740) 657-7000
DCB FINANCIAL CORP ANNOUNCES 44% INCREASE
IN THIRD QUARTER EARNINGS
BOARD DECLARES DIVIDEND
Lewis Center, Ohio - DCB Financial Corp (OTC: DCBF) today announced third
quarter earnings of $0.26 per share for the three months ended September 30,
2003, a 44% increase over 2002 third quarter earnings per share of $0.18. For
the nine months ended September 2003, earnings per share were $0.93 compared to
$0.81 for the comparable nine month period in 2002. Net income for the third
quarter of 2003 was $1.012 million, compared to $757 thousand for the same
quarter in 2002. For the 2003 nine month period, net income was $3.719 million
in 2003 and $3.380 million in 2002.
The Corporation's net interest margin declined during the 2003 quarter due to
the overall decline in interest rates in the economy and the success of our new
Platinum Savings Plus account, with a high introductory rate. The net interest
margin is expected to rebound in the fourth quarter as rates stabilize and the
introductory period expires. Loans grew by 5% from September 2002 to September
2003. Checking and savings grew by 15% in the same period. Credit quality
continues to improve as does productivity. Net charge offs for the first nine
months of 2003 were .31% compared to .69% for the same nine month period in
2002. Full time equivalent head count continues to decline as planned, from 208
as of September 30, 2002 to 189 on September 30, 2003. Return on assets for the
nine month period ending September 30, 2003 was .95% compared to .87% in 2002.
"While our overall performance is not consistent with our long term goals, we
are making good progress," said Jeff Benton, President and CEO. "The
Corporation's net interest margin has been negatively impacted by declining
rates and the introductory rate on our Platinum Savings Plus product rollout,
but should improve next quarter when the introductory rate ends and other
initiatives take effect. During the 2003 quarter, our credit quality improved,
numerous expense control initiatives helped lower our costs and most other
revenue sources increased. We are pleased with the steady progress and
optimistic about the future."
The DCB Board of Directors has declared a dividend of $0.10 per share payable on
November 17, 2003 to shareholders of record October 30, 2003.
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Disclosure Page 3
DCB FINANCIAL CORP - 8-K Filing Date: 10/22/03
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DCB Financial Corp (the "Corporation") is a financial holding company formed
under the laws of the State of Ohio. The Corporation is the parent of The
Delaware County Bank & Trust Company, (the "Bank") a state-chartered commercial
bank. The Bank conducts business from its main offices at 110 Riverbend Avenue
in Lewis Center, Ohio, and through its 16 full-service branch offices located in
Delaware and the surrounding communities. The Bank provides customary retail and
commercial banking services to its customers, including checking and savings
accounts, time deposits, IRAs, safe deposit facilities, personal loans,
commercial loans, real estate mortgage loans, night depository facilities and
trust services. The Bank also provides cash management, bond registrar and
payment services. The Bank offers data processing services to other financial
institutions, however such services are not a significant part of its current
operations or revenues.
APPLICATION OF CRITICAL ACCOUNTING POLICIES
DCB's consolidated financial statements are prepared in accordance with
accounting principles generally accepted in the United States and follow general
practices within the financial services industry. The application of these
principles requires management to make estimates, assumptions, and judgments
that affect the amounts reported in the financial statements and accompanying
notes. These estimates, assumptions, and judgments are based on information
available as of the date of the financial statements; as this information
changes, the financial statements could reflect different estimates,
assumptions, and judgments.
The most significant accounting policies followed by the Corporation are
presented in Note 1 of the audited consolidated financial statements contained
in the Corporation's 2002 Annual Report to Shareholders. These policies, along
with the disclosures presented in the other financial statement notes and in
this financial review, provide information on how significant assets and
liabilities are valued in the financial statements and how those values are
determined.
FORWARD-LOOKING STATEMENTS
Certain statements in this report constitute "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995, such as
statements relating to the financial condition and prospects, lending risks,
plans for future business development and marketing activities, capital spending
and financing sources, capital structure, the effects of regulation and
competition, and the prospective business of both the Corporation and its
wholly-owned subsidiary The Delaware County Bank & Trust Company (the "Bank").
Where used in this report, the word "anticipate," "believe," "estimate,"
"expect," "intend," and similar words and expressions, as they relate to the
Corporation or the Bank or their respective management, identify forward-looking
statements. Such forward-looking statements reflect the current views of the
Corporation and are based on information currently available to the management
of the Corporation and the Bank and upon current expectations, estimates, and
projections about the Corporation and its industry, management's belief with
respect thereto, and certain assumptions made by management. These
forward-looking statements are not guarantees of future performance and are
subject to risks, uncertainties, and other factors that could cause actual
results to differ materially from those expressed or implied by such
forward-looking statements. Potential risks and uncertainties include, but are
not limited to: (i) significant increases in competitive pressure in the banking
and financial services industries; (ii) changes in the interest
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Disclosure Page 4
DCB FINANCIAL CORP - 8-K Filing Date: 10/22/03
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rate environment which could reduce anticipated or actual margins; (iii) changes
in political conditions or the legislative or regulatory environment; (iv)
general economic conditions, either nationally or regionally (especially in
central Ohio), becoming less favorable than expected resulting in, among other
things, a deterioration in credit quality of assets; (v) changes occurring in
business conditions and inflation; (vi) changes in technology; (vii) changes in
monetary and tax policies; (viii) changes in the securities markets; and (ix)
other risks and uncertainties detailed from time to time in the filings of the
Corporation with the Commission.
The Corporation does not undertake, and specifically disclaims any obligation,
to publicly revise 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 CONSOLIDATED FINANCIAL INFORMATION (unaudited)
October 22, 2003 Press Release
DCB FINANCIAL CORP
Key Ratios and Other Financial Data
(Unaudited)
(Dollars in thousands)
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Three Months Ended $(000)
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9/30/03 9/30/02 12/31/02
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Key Financial Information:
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Net interest income $ 4,499 $ 5,191 $ 5,187
Provision for loan and lease losses 375 900 1,250
Non-interest income 1,554 1,545 1,657
Non-interest expense 4,197 4,696 4,651
Net income 1,012 757 623
Loan balances (average) 391,113 377,853 371,507
Deposit balances (average) 443,713 423,315 432,086
Basic and diluted earnings per common share $ 0.26 $ 0.18 $ 0.15
Total shares outstanding (000) 3,935 4,178 4,168
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Disclosure Page 5
DCB FINANCIAL CORP - 8-K Filing Date: 10/22/03
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SELECTED CONSOLIDATED FINANCIAL INFORMATION (unaudited)
October 22, 2003 Press Release
Three Months Ended
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9/30/03 9/30/02 12/31/02
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Key ratios:
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Return on assets .74% .57% 0.48%
Return on equity 8.29% 5.77% 4.74%
Non-interest expense to assets 0.77% 0.88% 0.89%
Efficiency ratio 68.27% 68.96% 63.93%
Net interest margin 3.62% 4.25% 4.22%
Equity to assets at period end 8.94% 9.82% 10.04%
Allowance for loan and lease losses / total loans 1.08% .89% 1.10%
Total allowance for losses on loans to non-performing loans 171.57% 68.69% 120.93%
Non-performing loans to total loans (net) 0.63% 1.30% 0.92%
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Disclosure Page 6