Exhibit 99.1
FOR IMMEDIATE RELEASE
For: Evans Bancorp, Inc.: Contact: Mark DeBacker, Treasurer
14-16 North Main Street Phone: (716) 549-1000
Angola, New York 14006 Fax: (716) 549-0720
EVANS BANCORP ANNOUNCES 8.0 PERCENT INCREASE IN THIRD QUARTER 2003 NET
INCOME AND 12.9 PERCENT INCREASE IN
SEPTEMBER 2003 YEAR-TO-DATE NET INCOME
ANGOLA, N.Y.-OCTOBER 22, 2003-Evans Bancorp, Inc. (Nasdaq: EVBN) the holding
company for Evans National Bank, a commercial bank with eight branches in
Western New York, and approximately $335.6 million in assets, today reported
strong growth in revenue and income for the quarter ended September 30, 2003.
The Company also announced a share repurchase program.
THIRD QUARTER 2003 PERFORMANCE HIGHLIGHTS:
- ------------------------------------------
- - NET INCOME GREW BY 8.0% OR $74 THOUSAND OVER THIRD QUARTER 2002
- - GROSS LOANS INCREASED DURING THE THIRD QUARTER BY 4.8% AND 17.6%
YEAR-TO-DATE
- - GROWTH IN NON-INTEREST INCOME WHICH COMPRISED 35.8% OF TOTAL REVENUE IN THE
THIRD QUARTER 2003 AS COMPARED TO 26.6% IN THE THIRD QUARTER 2002
NET INCOME:
- -----------
Net income was $1.0 million or $0.41 per share for the quarter ended September
30, 2003 as compared to $0.9 million or $0.38 per share for the quarter ended
September 30, 2002. Year-to-date net income was $3.1 million or $1.26 per share
as compared to $2.7 million or $1.13 per share for the nine months ended
September 30, 2002. All per share amounts reflect the special 5 percent stock
dividend paid in January 2003 and the special 5 percent stock dividend payable
on December 1, 2003 to shareholders of record as of October 14, 2003, which was
declared on September 16, 2003.
James Tilley, President and Chief Executive Officer, said, "We are pleased with
our financial performance in the third quarter while the economic environment
remains challenged. As a result of low interest rates, our net interest margin
has declined due to investment securities premium amortization and lower
reinvestment rates available to us. Despite this, we were able to grow our
earnings due to our business diversification strategy, which resulted in strong
growth in non-interest income. Looking forward, we expect investment security
premium amortization to slow in the fourth quarter should interest rates
stabilize, causing mortgage refinancings to slow."
FINANCIAL POSITION:
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Total assets were $335.6 million at September 30, 2003, an increase of 1.1% and
16.3% over June 30, 2003 and December 31, 2002, respectively. Asset growth
included an increase of $8.1 million in gross loans or 4.8% for the third
quarter. Investment securities also grew $1.4 million or 1.1% in the third
quarter. This growth was funded by a $5.8 million reduction in cash, $3.3
million in additional overnight borrowings, and modest deposit growth of $0.5
million or 0.2% during the third quarter.
Asset quality continues to remain strong with net charge-offs of $5 thousand in
the third quarter 2003. Non-performing loans totaled 0.15% of total loans
outstanding at September 30, 2003 as compared to 0.79% at December 31, 2003. The
allowance for loan losses totaled $2.5 million or 1.41% of gross loans
outstanding at September 30, 2003 as compared to 1.42% at December 31, 2002.
OPERATIONAL RESULTS:
- --------------------
Net interest income of $2.5 million for the third quarter 2003 represented a
$0.1 million decrease from the third quarter 2002, primarily as a result of
accelerated amortization of investment securities premiums as a result of the
low interest rate environment. The low interest rate environment caused a large
amount of activity in mortgage refinancings which led to an acceleration of
amortization on investment securities purchased at a premium that were backed by
mortgages. Additionally, loan interest income declined slightly for the quarter
as a result of the low interest environment. As a result, year-to-date September
2003, net interest income has increased a modest $12 thousand or 0.2% over the
same time period in 2002.
Non-interest income was $2.0 million for the third quarter 2003, an increase of
$0.7 million or 48.1% over the third quarter 2002. Year-to-date September 2003
non-interest income was $6.0 million, an increase of $2.0 million or 48.9% over
the same period in 2002. For the quarter, increases were realized in most
non-interest income categories, including M&W insurance fees of $0.2 million,
service charges of $0.2 million, securities gains of $0.1 million, loan-related
fees including prepayment fees of $0.1 million, and income on bank-owned life
insurance of $0.1 million.
Non-interest expense was $3.1 million for the third quarter 2003, an increase of
$0.5 million or 17.4% over the third quarter 2002. Year-to-date September 2003
non-interest expense was $9.5 million, an increase of $1.7 million or 21.1% over
the same time period in 2002. The primary increase of $0.3 million for the
quarter was salaries related to Company growth and merit pay increases. The
remainder of the increase pertains to a number of items including the Bank's
first quarter 2003 conversion to a next generation item processing data center
environment, which has resulted in additional capacity, capability and
opportunity for future efficiencies.
SHARE REPURCHASE:
- -----------------
During the third quarter 2003, the Company repurchased 25,000 common shares at
an average price of $21.94, under a stock repurchase plan approved by the Board
of Directors in September 2001. On October 21, 2003, the Board of Directors
approved a new stock repurchase plan which authorizes the Company to repurchase
up to 50,000 shares of stock over the next two years. Under the plan, purchases
will be made on a discretionary basis, in the open market or otherwise, at times
and amounts as determined by management, subject to market conditions, business
conditions, applicable legal and regulatory requirements and other factors. As
of October 22, 2003, the Company had approximately 2.4 million shares
outstanding.
OUTLOOK:
- --------
Based on the third quarter earnings results, common stock repurchased in 2003,
and adjustment of per share data for the 5 percent stock dividend payable in
December 2003, management of Evans Bancorp, Inc has increased its net income per
share estimate for the 2003 year to be in the range of $1.61-$1.71 per share.
Tilley stated, "Through a difficult business environment, we have been able to
meet or exceed most of our strategic goals thus far in 2003. In order to meet
our mid-range strategic goals, we anticipate opening our ninth branch location
in Lancaster, New York in December 2003 and following such opening with one
additional branch location in each of the coming three years. We feel this
network should allow us to realize benefits of critical mass from the
infrastructure we have invested in and developed over recent
years."
Attached are Unaudited Statements of Income and Balance Sheets for Evans
Bancorp, Inc.
A conference call will be held with company management at 11:00 a.m. (ET) on
Thursday, October 23, 2003 to discuss performance results for the third quarter
of 2002 at 1-800-335-9329 (request Evans Bancorp Conference Call). An audio
recording will be available one hour after the call through October 30, 2003 at
12:00 p.m., and may be accessed at 1-800- 642-1687, passcode 9851036. The call
will also be simultaneously broadcast live over the Internet at the following
link: http://www.firstcallevents.com/service/ajwz391579529gf12.html and will be
archived for 90 days. There is no charge to attend either event.
Evans Bancorp, Inc. is the holding company for Evans National Bank, a commercial
bank with eight branches located in Western New York, which had approximately
$335.6 million in assets and approximately $274.1 million in deposits at
September 30, 2003. Evans National Bank also owns M&W Agency, Inc., a retail
property and casualty insurance agency with ten offices in Western New York, and
ENB Associates, Inc. which provides non-deposit investment products. Evans
Bancorp, Inc. common stock is listed on the Nasdaq National Market under the
symbol EVBN.
This press release includes "forward looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Such statements include,
but are not limited to, statements concerning future business, revenues and
earnings. These statements are not historical facts or guarantees of future
performance events or results. There are risks, uncertainties and other factors
that could cause the actual results of the Company to differ materially from the
results expressed or implied by such statements. Information on factors that
could affect the Company's business and results is discussed in the Company's
periodic reports filed with the Securities and Exchange Commission. Forward
looking statements speak only as of the date they are made. The Company
undertakes no obligation to publicly update or revise forward looking
information, whether as a result of new, updated information, future events or
otherwise.
EVANS BANCORP, INC.
STATEMENTS OF INCOME
UNAUDITED
($000s) EXCEPT PER SHARE DATA
QUARTER ENDED SEPTEMBER 30, NINE MONTHS ENDED SEPTEMBER 30,
2003 2002 2003 2002
------- ------- ------- -------
INTEREST INCOME:
Loans $ 2,677 $ 2,689 $ 7,996 $ 8,117
Federal funds sold & interest on deposits in other banks 15 14 77 54
Securities:
Taxable 380 580 1,557 2,005
Non-taxable 573 511 1,714 1,466
------- ------- ------- -------
Total interest income 3,645 3,794 11,344 11,642
INTEREST EXPENSE:
Interest on deposits 961 1,037 3,002 3,353
Short-term borrowings 165 131 459 418
------- ------- ------- -------
1,126 1,168 3,461 3,771
NET INTEREST INCOME 2,519 2,626 7,883 7,871
Provision for loan losses 120 105 360 315
------- ------- ------- -------
Net Interest Income after provision for
loan losses 2,399 2,521 7,523 7,556
NON-INTEREST INCOME
Service charges 451 261 1,353 818
Insurance service and fees 897 737 2,797 2,244
Commission fees 56 89 167 183
Gain (loss) on sales of securities 58 0 271 111
Premiums on loans sold 56 13 102 34
Other 515 275 1,304 635
------- ------- ------- -------
Total non-interest income 2,035 1,375 5,994 4,025
NON-INTEREST EXPENSE:
Salaries and benefits 1,742 1,413 5,028 4,104
Occupancy 349 325 1,096 963
Supplies 54 61 222 171
Repairs and maintenance 81 97 296 304
Advertising and public relations 56 50 203 145
Professional services 98 146 553 425
FDIC assessment 11 9 29 26
Other insurance 82 72 211 210
Other 659 496 1,876 1,509
------- ------- ------- -------
Total non-interest expense 3,132 2,669 9,514 7,857
Income before taxes 1,302 1,227 4,003 3,724
Income Taxes 293 292 908 983
NET INCOME $ 1,009 $ 935 $ 3,095 $ 2,741
======= ======= ======= =======
Earnings per share - Basic and Diluted* $ 0.41 $ 0.38 $ 1.26 $ 1.13
======= ======= ======= =======
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* All per share data reflects the 5% stock dividend paid January 29, 2003 and
the 5% stock dividend declared September 16, 2003 and payable December 1,
2003.
EVANS BANCORP, INC.
BALANCE SHEETS
UNAUDITED
($000s)
SEPTEMBER 30 DECEMBER 31
2003 2002
-------- --------
ASSETS
Cash and due from banks $ 10,021 $ 11,309
Federal funds sold 0 8,450
Interest bearing accounts on other banks 683 877
Securities:
Classified as available-for-sale, at fair value 126,120 103,031
Classified as held-to-maturity, at amortized cost 3,642 3,641
Loans, net of allowance for loan losses of $2,381
in 2003 and $2,146 in 2002 175,275 148,998
Properties and equipment, net 5,404 5,349
Goodwill assets 2,945 2,945
Intangible assets 830 787
Bank owned life insurance 7,162 663
Other assets 3,550 2,661
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TOTAL ASSETS $335,632 $288,711
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Demand $ 49,494 $ 44,665
NOW accounts 11,072 10,535
Regular savings 111,693 94,908
Time deposits, $100,000 or over 32,150 28,441
Other time accounts 69,647 60,958
-------- --------
274,055 239,507
Other borrowed funds 17,875 8,111
Securities sold under agreement to repurchase 6,993 6,543
Dividend payable 788 0
Other liabilities 3,808 3,688
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TOTAL LIABILITIES 303,520 257,849
STOCKHOLDERS' EQUITY
Common stock, $0.50 par value; 10,000,000
shares authorized; 2,432,309 and
2,450,870 shares issued,respectively 1,229 1,167
Capital surplus 19,319 16,579
Retained earnings 10,192 11,180
Accumulated other comprehensive income, net 1,948 1,942
Less: Treasury stock, at cost -576 -6
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TOTAL STOCKHOLDERS' EQUITY 32,112 30,862
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TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $335,632 $288,711
======== ========
- --------
Note: All per share data reflects the 5% stock dividend paid January 29, 2003
and the 5% stock dividend declared September 16, 2003 and payable December
1, 2003.