Exhibit 99.1
FOR IMMEDIATE RELEASE COMPANY CONTACT: Paul A. Miller
(978) 725-7555
LSB CORPORATION
FIRST QUARTER RESULTS 2005
NORTH ANDOVER, MA, -- (BUSINESS WIRE) - April 22, 2005 - LSB Corporation, (the
"Corporation" or the "Company") (NASDAQ-LSBX), today announced results for the
first quarter ended March 31, 2005. Press releases and SEC filings can be viewed
on the internet at our website www.LawrenceSavings.com/press-main.asp or
www.LawrenceSavings.com/stockholder-info.asp, respectively.
The Corporation reported net income of $859,000 or $0.19 diluted earnings per
share for the first three months of 2005. This amount compares to net income of
$786,000 or $0.18 diluted earnings per share for the same period of 2004.
Net income for the three months ended March 31, 2005 increased by $73,000 over
the same period in 2004 primarily due to an increase in net interest income. Net
interest income increased by $131,000 or 3.8% to $3,554,000 compared to the same
period in 2004. Net interest income increased primarily due to higher average
investment and loan balances for the three months ended 2005 compared to 2004
which impacted interest income by $405,000 and $268,000, respectively. These
interest earning assets were funded by deposit growth and increased FHLB
advances. Non-interest income increased by $43,000 and was offset by an increase
in non-interest expenses of $93,000. The increase in non-interest income of
$43,000 was primarily due to loan fees increasing by $18,000 and ATM and debit
card fees increasing by $15,000 in 2005 compared to 2004. The increase in loan
fees for the first quarter 2005 can be attributed to a decrease in the provision
for losses associated with mortgage servicing rights ("MSR") resulting in a
$25,000 positive impact to earnings from 2004.
Non-interest expenses were $2,581,000 in the first three months of 2005 compared
to $2,488,000 for the same period of 2004. The increase in the first three
months of 2005 is primarily due to occupancy and equipment expense increasing to
$255,000 from $197,000 due to higher depreciation expense in the first quarter
of 2005 due to the Salem, NH branch which was not opened until June 2004. Data
processing expense increased $21,000 in the first three months of 2005 compared
to the first three months of 2004 mainly attributable to a rise in computer
repairs and maintenance. Other operating expenses increased $71,000 during 2005
from 2004. During 2004, the Company recognized the reimbursement of $100,000 of
legal expenses which were part of an insurance claim recovery in the amount of
$197,000. Partially offsetting these expense increases were salaries and
employee benefits decreasing to $1,576,000 in 2005 from $1,622,000 in 2004 due
to decreases in pension and post retirement benefits. Professional fees
decreased to $104,000 from $115,000 due to a reduction in legal fees associated
with collection efforts.
The Corporation continues to look for quality assets, seeks to maintain a low
level of risk assets and seeks to grow the loan portfolio profitably.
Non-performing loans totaled $34,000 and zero at March 31, 2005 and December 31,
2004, respectively. The allowance for loan losses to total loans has decreased
slightly to 1.77% at March 31, 2005 from 1.78% at December 31, 2004 as a result
of growth in the loan portfolio, without a significant change in credit risk to
the Company.
Total assets increased to $560,613,000 at March 31, 2005 up from $518,477,000 at
December 31, 2004. The increase in assets at March 31, 2005 is mainly
attributable to an increase of $35,804,000 in investment securities, an increase
of $3,218,000 in Federal Funds sold, $1,642,000 in loan growth and $1,794,000
increase in Federal Home Loan Bank stock. The funding for these assets came
primarily from deposit growth and increased Federal Home Loan Bank Advances of
$2,767,000 and $39,626,000, respectively in 2005.
Total deposits at March 31, 2005 were $301,873,000 up from $299,106,000 at
December 31, 2004. The change from December 31, 2004 is due primarily to
increases in demand deposit accounts of $2,176,000, savings accounts of
$1,856,000 and NOW accounts of $1,028,000 partially offset by a decrease in
money market investment accounts of $2,693,000.
At March 31, 2005, the Company's stockholders' equity was $58,004,000 as
compared to $57,838,000 at December 31, 2004. The increase during 2005 reflects
net income of $859,000, a tax benefit associated with the exercise of stock
options of $196,000 and proceeds from the exercise of stock options of $270,000.
Offsetting these increases were the declaration of cash dividends to
shareholders of $613,000 and a decrease in the market values of securities
available for sale (net of taxes) of $546,000. The Corporation's leverage ratio
decreased to 10.91% at March 31, 2005 from 11.25% at December 31, 2004 as a
result of average quarterly assets increasing due to the purchase of investment
securities during the first quarter 2005. The Corporation exceeds all regulatory
minimum capital ratio requirements as defined by the Federal Reserve Bank as of
and for all periods presented. The Bank exceeds all regulatory minimum capital
ratio requirements as defined by the FDIC as of and for all periods presented.
Lawrence Savings Bank, the Company's wholly-owned subsidiary, is a Massachusetts
chartered savings bank organized in 1868 and headquartered at 30 Massachusetts
Avenue, North Andover, Massachusetts, approximately 25 miles north of downtown
Boston. Lawrence Savings Bank operates 5 banking offices in Massachusetts in
Andover, Lawrence, Methuen, and North Andover and 1 banking office in Salem, New
Hampshire. Go to www.LawrenceSavings.com for all your Internet Banking needs.
Please visit it today. Lawrence Savings Bank is an Equal Housing Lender and
member, FDIC and DIFM.
This press release may contain certain statements that are "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, as amended. Such statements
are not historical facts and include expressions of management's expectations at
a specific point in time regarding future relationships, structures,
opportunities and market conditions. Such expectations may or may not be
realized, depending on a number of variable factors, including but not limited
to, changes in interest rates or in the relationships between long-term and
short-term rates, disruptions in credit markets, changes in regional and local
economic conditions, changes in local housing markets, changes in the regulatory
environment including regulatory compliance costs, changes in technology and
changes in the competitive environment in which the Company operates. As a
result of such risks and uncertainties, the Company's actual results may differ
materially from such forward-looking statements. The Company does not undertake,
and specifically disclaims any obligation to publicly release revisions to any
such forward-looking statements to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such statement.
LSB CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET*
(In thousands, except per share data)
March 31, 2005 December 31, 2004
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Loans $ 234,452 232,810
Allowance for loan losses (4,139) (4,140)
Investments held to maturity 238,659 200,264
Investments available for sale 60,448 63,039
Federal Home Loan Bank stock 9,681 7,887
Federal funds sold 3,427 209
Other assets 18,085 18,408
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Total assets $ 560,613 $ 518,477
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Deposits $ 301,873 $ 299,106
Borrowed funds 196,889 157,263
Other liabilities 3,847 4,270
Stockholders' equity 58,004 57,838
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Total liabilities and stockholders' equity $ 560,613 $ 518,477
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Book value per share $ 13.23 $ 13.33
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Select financial ratios: March 31, 2005 December 31, 2004
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Capital ratios:
Stockholders' equity to total assets ratio 10.35% 11.16%
Risk-based ratio
Leverage ratio 10.91% 11.25%
Total capital ratio 19.44% 19.63%
Asset quality ratios:
Allowance for loan losses to loans 1.77% 1.78%
Risk assets to total assets 0.01% 0.00%
Risk assets:
Non-performing loans $ 34 $ --
Other real estate owned -- --
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Total risk assets $ 34 $ --
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CONDENSED CONSOLIDATED INCOME STATEMENT*
(In thousands, except share data)
Three months ended
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March 31, 2005 March 31, 2004
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Interest income $ 6,109 $ 5,442
Interest expense 2,555 2,019
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Net interest income 3,554 3,423
Provision (credit) for loan losses -- --
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Net interest income after provision (credit)
for loan losses 3,554 3,423
Non-interest income 365 322
Non-interest expense 2,581 2,488
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Net income before income taxes 1,338 1,257
Income tax expense 479 471
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Net income $ 859 $ 786
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Basic earnings per share $ 0.20 $ 0.18
Dilutive earnings per share $ 0.19 $ 0.18
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Average shares outstanding 4,365,559 4,263,637
Average diluted shares outstanding 4,532,751 4,455,979
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Three months ended
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March 31, 2005 March 31, 2004
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Select financial ratios:
Return on average assets 0.65% 0.67%
Return on average stockholders' equity 6.02% 5.74%
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*Unaudited