Exhibit 99
DCB FINANCIAL CORP - 8-K Filing Date: 07/22/03
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FOR IMMEDIATE RELEASE CONTACT:
Tuesday July 22, 2003 John A. Ustaszewski
Chief Financial Officer
(740) 657-7000
DCB FINANCIAL CORP ANNOUNCES INCREASED SECOND QUARTER EARNINGS
BOARD DECLARES DIVIDEND
Lewis Center, Ohio - DCB Financial Corp, (OTC: DCBF) today announced second
quarter earnings of $0.31 per share for the three months ended June 30, 2003, an
11% increase over 2002 second quarter earnings per share of $0.28. On a
year-to-date basis, 2003 earnings per share were $0.67 compared to $0.63 for
the comparable six month period in 2002. Net income for the second quarter of
2003 was $1.208 million, compared to $1.168 million for the same quarter in
2002. For the comparable six month periods, net income was $2.707 million in
2003 and $2.623 million in 2002.
The improvement in second quarter earnings was driven by a stabilized net
interest margin, improved credit quality and improved productivity. A gain on
the sale of property held for a future branch site of approximately $290
thousand also occurred in the second quarter. These favorable trends and events
more than offset the approximate $427 thousand in costs related to shareholder
litigation and the related proxy fight. Net charge offs for the first six months
of 2003 were .25% compared to .32% for the same period 2002. Delinquency rates,
classified loans and non-performing loans have all decreased since year-end
2002. Our full-time equivalent headcount has declined from 203.5 in December
2002 to 191 in June 2003. Loans grew by 4.5% from June 2002 to June 2003.
Checking and savings balances grew by 2% in the same period. Return on assets
increased slightly from 1.02% to 1.04% for the first six months of 2003 compared
to 2002.
"The initiatives we have put in place in the early stages of this year are
beginning to bear fruit", said Jeff Benton, President and CEO of the Delaware
County Bank and Trust Company, the wholly owned subsidiary of the Company.
"Management has fully embraced our stated priorities of Controls, Profits and
then Growth." In his recent address to shareholders at the annual meeting,
Benton noted the numerous performance improvements in the first quarter under
the major captions of; Credit Quality, Productivity, Controls, Record Earnings
Per Share, Increased Dividend and Loan and Deposit Growth Rates. "These
improvements, along with many other initiatives, have carried over into the
second quarter results and should drive improved results in the future." Benton
said, "We are buoyed by the sustained early successes, but we are also wary of
continued challenges in the economy. We will continue to meet those challenges
with increased confidence in our ability to perform."
The DCB Board of Directors has declared a dividend of $0.10 per share payable on
August 15, 2003 to shareholders of record July 25, 2003.
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Disclosure Page 3
DCB FINANCIAL CORP - 8-K Filing Date: 07/22/03
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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: 07/22/03
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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)
July 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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6/30/03 6/30/02 12/31/02
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Key Financial Information:
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Net interest income $ 4,973 $ 5,474 $ 5,187
Provision for loan and lease losses 355 500 1,250
Non-interest income 1,848 1,337 1,657
Non-interest expense 4,689 4,525 4,651
Net income 1,208 1,168 623
Loan balances (average) 375,530 363,229 371,507
Deposit balances (average) 433,404 432,972 432,086
Basic and diluted earnings per common share $ 0.31 $ 0.28 $ 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: 07/22/03
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SELECTED CONSOLIDATED FINANCIAL INFORMATION (unaudited)
July 22, 2003 Press Release
Three Months Ended
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6/30/03 6/30/02 12/31/02
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Key ratios:
Return on assets .92% .88% 0.48%
Return on equity 9.91% 9.14% 4.74%
Non-interest expense to assets .89% 0.86% 0.89%
Efficiency ratio 67.69% 66.61% 63.93%
Net interest margin 4.07% 4.50% 4.22%
Equity to assets at period end 9.24% 9.55% 10.04%
Allowance for loan and lease losses / total loans 1.11% 1.03% 1.10%
Total allowance for losses on loans to non-performing loans 150.95% 75.93% 120.93%
Non-performing loans to total loans (net) 0.74% 1.37% 0.92%
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Disclosure Page 6