1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: April 18, 2001
--------------
United Community Financial Corp.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Ohio 0-24399 34-1856319
- --------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer of
incorporation) File Number) Identification Number)
275 Federal Plaza West
Youngstown, Ohio 44503-1203
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (330) 742-0500
-----------------------------
Not Applicable
- --------------------------------------------------------------
(Former name or former address, if changes since last report.)
2
UNITED COMMUNITY FINANCIAL CORP.
275 Federal Plaza West
Youngstown, Ohio 44503-1203
FOR IMMEDIATE RELEASE
Patrick A. Kelly
Chief Financial Officer
(330) 742-0500, Ext. 592
UNITED COMMUNITY FINANCIAL CORP. ANNOUNCES
EARNINGS FOR FIRST QUARTER 2001
YOUNGSTOWN, Ohio (April 18, 2001) - United Community Financial Corp. (Nasdaq:
UCFC) today announced its financial results for the first quarter of 2001.
United Community is the holding company of The Home Savings and Loan Co. and
Butler Wick Corp.
For the three month period ended March 31, 2001, United Community reported net
income of $3.2 million, or $0.10 per diluted share, compared to net income of
$3.1 million, or $0.09 per diluted share, for the same three month period in
2000. United Community's net interest income increased $561,000 and noninterest
expense declined $1.7 million, which were partially offset by a $1.5 million
decrease in noninterest income. The decline in noninterest income is primarily
due to lower commissions earned at Butler Wick. The reduced trading volume at
Butler Wick was also the principal factor in the lower level of compensation
expense which caused the decline in noninterest expense.
United Community's return on average assets and return on average equity were
0.98% and 4.89%, respectively, for the first quarter of 2001. The return on
average assets and return on average equity were 1.00% and 4.81%, respectively,
for the first quarter of 2000.
Total shareholders' equity decreased $4.3 million, or 1.7%, to $257.6 million at
March 31, 2001 from $261.9 million at December 31, 2000. The decrease was
primarily due to the quarterly dividend payment and treasury stock purchases,
offset by earnings for the quarter. Book value as of March 31, 2001 was $7.64
per share.
Total assets increased $56.6 million, or 4.4%, from December 31, 2000 to March
31, 2001, primarily as a result of increases in cash and cash equivalents and
loans of $26.0 million and $50.7 million, respectively. These increases were
funded by increased deposits of $39.3 million and other borrowed funds of $24.2
million.
3
Net loans increased $50.7 million, or 5.8%, from December 31, 2000 to March 31,
2001 due to increases of $15.9 million in gross mortgage loans, $861,000 in
gross commercial loans, $22.3 million in gross construction loans and $6.0
million in gross consumer loans. These increases were due to a continual effort
to increase loans in both United Community's traditional market and new markets
such as Canton, Stow and Cleveland.
Deposits increased $39.3 million, or 4.4%, from December 31, 2000 to March 31,
2001, primarily due to a $33.5 million increase in certificates of deposit,
primarily due to Home Savings providing competitive interest rates.
"We are pleased by the earnings for the first quarter of 2001, as well as the
continued growth in loans and deposits," said Douglas M. McKay, chairman and
chief executive officer of United Community. "We are looking forward to our
previously announced acquisition of Industrial Bancorp, which will give us
additional growth opportunities in new markets and allow us to begin offering
our variety of products and services to Industrial's customers."
Home Savings and Butler Wick are wholly owned subsidiaries of United Community
Financial Corp. Home Savings operates 17 full service banking offices located
throughout Mahoning, Columbiana and Trumbull Counties in Northeastern Ohio and 4
loan production offices in the Cleveland, Canton, Stow and Mentor areas. Butler
Wick has 11 full service offices and one trust office located throughout
Northeastern Ohio and Western Pennsylvania. Additional information on United
Community, Home Savings and Butler Wick may be found on United Community's web
site: www.ucfconline.com.
------------------
###
This press release includes statements that may constitute forward-looking
statements made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. The statements regarding continued implementation
of United Community's strategic plan and anticipated earnings for the year are
forward-looking in nature. These statements are subject to risks and
uncertainties that could cause actual results to differ materially from the
forward-looking statements. Such risks include, among other factors, the
acceptance of new products in the marketplace and the success of finding
additional opportunities for product and geographic expansion. For a more
complete list of risk factors, read United Community's Form 10K filed with the
Securities and Exchange Commission.
4
UNITED COMMUNITY FINANCIAL CORP.
As of As of
March 31, 2001 December 31, 2000
-------------- -----------------
(In thousands, except per share data)
SELECTED FINANCIAL CONDITION DATA:
ASSETS
Cash and cash equivalents $ 71,977 $ 45,972
Mortgage-backed securities 198,392 199,415
Investment securities 86,264 105,254
Federal Home Loan Bank stock 14,039 13,793
Net loans receivable:
Loans held for investment 929,744 879,356
Loans held for sale 4,520 3,850
Allowance for loan losses (6,865) (6,553)
Real estate owned 349 359
Other assets 58,338 58,753
----------- -----------
Total assets $ 1,356,758 $ 1,300,199
=========== ===========
LIABILITIES
Deposits $ 939,693 $ 900,413
Other borrowed funds 138,516 114,317
Other liabilities 20,998 23,570
----------- -----------
Total liabilities 1,099,207 1,038,300
SHAREHOLDERS' EQUITY
Preferred stock-no par value; 1,000,000 shares authorized and unissued
at March 31, 2001 - -
Common stock-no par value; 499,000,000 shares authorized; 37,799,309
shares issued and 36,290,809 and 37,800,497 outstanding, respectively 136,989 136,967
Retained earnings 155,706 155,026
Other comprehensive income (loss) 1,009 (98)
Unearned compensation (25,795) (26,674)
Treasury stock, at cost; 1,508,500 and 483,500 shares, respectively (10,358) (3,322)
----------- -----------
Total shareholders' equity 257,551 261,899
----------- -----------
Total liabilities and shareholders' equity $ 1,356,758 $ 1,300,199
=========== ===========
Book value per share $ 7.64 $ 7.77
Dividends paid per share $ 0.075 $ 0.075
5
Three Months Ended Three Months Ended Three Months Ended
March 31, December 31, March 31,
2001 2000 2000
-------- -------- --------
(In thousands, except per share data)
SELECTED EARNINGS DATA (UNAUDITED):
Interest income $ 24,038 $ 24,087 $ 21,879
Interest expense 11,681 12,207 10,083
-------- -------- --------
Net interest income 12,357 11,880 11,796
Provision for loan losses 330 150 -
Noninterest income:
Commissions 3,591 3,645 5,384
Service fees and other charges 1,919 1,563 1,255
Underwriting and investment banking 63 320 21
Net gains (losses)
Securities (74) 166 381
Other 16 (7) 2
Other income 273 241 212
-------- -------- --------
Total noninterest income 5,788 5,928 7,255
Noninterest expense
Salaries and employee benefits 7,864 8,611 9,628
Occupancy 573 553 456
Equipment and data processing 1,619 1,585 1,300
Other noninterest expense 2,723 3,150 3,057
-------- -------- --------
Total noninterest expense 12,779 13,899 14,441
Income before taxes 5,036 3,759 4,610
Income taxes 1,834 1,306 1,508
-------- -------- --------
Net income $ 3,202 $ 2,453 $ 3,102
======== ======== ========
Basic earnings per share $ 0.10 $ 0.08 $ 0.09
Diluted earnings per share $ 0.10 $ 0.08 $ 0.09
6
Three Months Ended Three Months Ended Three Months Ended
March 31, December 31, September 30,
2001 2000 2000
------------------ ------------------ ------------------
(Dollars in thousands)
AVERAGE DAILY BALANCE OF SELECTED FINANCIAL CONDITION DATA (UNAUDITED):
Net loans held for investment (including allowance for loan losses $ 890,813 $ 851,889 $ 800,785
of $6,865, $6,553 and $6,461, respectively)
Net loans held for sale 4,914 4,223 3,908
Mortgage-backed securities 197,933 211,030 222,108
Investment securities 96,088 111,578 141,482
Margin accounts 32,874 42,273 43,702
Other interest-earning assets 45,586 38,876 20,630
Total interest-earning assets 1,268,208 1,259,869 1,232,615
Total assets 1,308,752 1,300,516 1,275,354
Certificates of deposit 553,389 506,886 471,751
Checking, demand and savings accounts 344,909 346,319 358,298
Other interest bearing liabilities 104,430 141,943 139,447
Total interest-bearing deposits 1,002,728 995,148 969,496
Total noninterest-bearing liabilities 43,902 42,793 45,401
Total liabilities 1,046,648 1,037,941 1,014,897
Shareholders' equity 262,104 262,575 260,457
Common shares outstanding for basic EPS calculation 32,671,313 33,130,228 33,252,174
Common shares outstanding for diluted EPS calculation 32,814,872 33,187,843 34,093,040
SUPPLEMENTAL LOAN DATA:
Loans originated $ 113,590 $ 80,835 $ 92,587
Loans purchased 900 4,409 3,262
Loans sold 1,305 - -
Loan chargeoffs 99 87 16
Recoveries on loans 81 28 4
As of As of As of
March 31, 2001 December 31, 2000 September 30, 2000
-------------- ----------------- ------------------
(Dollars in thousands)
SUPPLEMENTAL DATA:
Nonaccrual loans $ 5,578 $ 9,458 $ 3,409
Restructured loans 206 208 212
Other real estate owned 349 359 307
Total nonperforming assets 6,133 10,025 3,928
Loans serviced for others 4,780 4,906 5,015
Number of full time equivalent employees 591 573 566
Mortgage-backed securities available for sale 97,741 91,731 99,097
Mortgage-backed securities held to maturity 100,651 107,684 117,847
Investment securities trading 5,968 5,933 5,813
Investment securities available for sale 79,415 98,445 113,010
Investment securities held to maturity 881 876 875
Federal home loan bank stock 14,039 13,793 13,538
Fair value of held to maturity securities 103,639 109,129 116,930
REGULATORY CAPITAL DATA:
Regulatory tangible capital $ 178,896 $ 175,340 $ 159,552
Tangible capital ratio 14.05 14.51 13.50
Regulatory core capital 178,896 175,340 159,552
Core capital ratio 14.05 14.51 13.50
Regulatory total capital 185,330 181,460 165,954
Total risk adjusted assets 785,202 745,696 710,548
Total risk adjusted ratio 23.60 24.33 23.36