Exhibit 99.1
www.fnbcorporation.com
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FOR RELEASE AFTER 5:00 P.M. EST, JANUARY 22, 2004
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DATE: January 22, 2004
CONTACTS:
MEDIA - Kathryn Lima
(724) 981-4318
(724) 301-6984 (cell)
ANALYSTS/INSTITUTIONAL INVESTORS -
John Waters
239-514-2643
239-272-6495 (cell)
INDIVIDUAL SHAREHOLDERS -
Shareholder Services, 888-441-4362
F.N.B. CORPORATION ANNOUNCES EARNINGS
FOR FOURTH QUARTER AND YEAR-END 2003
HERMITAGE, PA, January 22, 2004 - F.N.B. Corporation (NYSE: FNB), a financial
services company that offers banking, insurance, wealth management and consumer
finance services, today reported net income of $10.3 million, or $0.21 per
diluted share, for the fourth quarter of 2003. This compares with $24.1 million,
or $0.52 per diluted share, for the fourth quarter of 2002. The fourth quarter
2003 results reflect the impact of the restructuring charges associated with the
completion of the Corporation's spin off of its Florida operation. Excluding
these after tax restructuring charges of $12.6 million, the results would have
been $22.9 million or $0.49 per diluted share.
For the year 2003, net income totaled $58.8 million, or $1.25 per diluted share.
This compares with $63.3 million, or $1.35 per diluted share, for 2002. Without
merger and restructuring expenses of $.74 per share in 2003 and $0.66 per share
in 2002, earnings per share for the year would have been $1.99 and $2.01
respectively.
more...
F.N.B. Corporation Fourth Quarter and Year 2003 Earnings Page 2 of 4
"The completion of the restructuring on January 1 closes another chapter in
F.N.B.'s history," said Stephen J. Gurgovits, President and CEO of F.N.B.
Corporation. "I hope the financial historians will look back and conclude that
our shareholders received a superior return on their investment. In just the
past three years, the price of F.N.B stock has increased 95%. This compares very
favorably with our banking peers across the country whose median stock price
increased 33%."
PRO FORMA FINANCIAL RESULTS
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In order to present a clear picture of F.N.B. Corporation's performance as it is
structured for 2004, following are the pro forma financial results for the
company for the fourth quarter and the year of 2003 without its Florida
operation and excluding restructuring and merger related expenses.
In the fourth quarter 2003 F.N.B. Corporation had net income of $12.6 million,
or $0.27 per diluted share, compared to the 2003 third quarter of $12.5 million
or $0.27 per diluted share. Return on equity (ROE) for the 2003 fourth quarter
was 21.6%.
For the year 2003, net income was $55.8 million, or $1.19 per diluted share
resulting in a Return on Equity (ROE) of 20.0%.
Net interest income on a tax equivalent basis for the quarter was $42.9 million,
compared to $42.1 million in the third quarter. This represents an increase of
1.8%, driven by a widening net interest margin of 4.05% in the fourth quarter,
up from 3.99% in the third quarter. The improved net interest income can be
attributed to a lower cost of deposits, as well as the third quarter
restructuring of our Federal Home Loan Bank (FHLB) portfolio that reduced the
cost of borrowed funds. For the year 2003, net interest income on a tax
equivalent basis was $174.6 million with a net interest margin of 4.21%.
Non interest income for the quarter was $15.8 million, compared to $17.6 million
in the third quarter. The decrease is attributable to lower gains on sales of
mortgages and securities,
F.N.B. Corporation Fourth Quarter and Year 2003 Earnings Page 3 of 4
combined with a seasonal decrease in retail investment sales and insurance
commissions. Non interest income for the year was $70.2 million, and represents
29% of total revenue.
Total non interest expenses in the fourth quarter were $35.1 million, compared
to $37.1 million in the third quarter. This represents a decline of 5.4% on a
linked quarter basis. In addition to realizing the previously announced cost
savings, the decrease reflects the reversal of certain performance compensation
accruals at year end. The efficiency ratio improved to 58.9% in the fourth
quarter from 61.2% in the third quarter. For the year, total non interest
expenses were $145.8 million with an efficiency ratio of 58.7%.
Credit quality remained solid during the quarter. As of December 31, 2003, the
allowance for loan losses was 1.41% of total loans compared to 1.42% in the
third quarter. Non-performing assets were 0.69% of total assets, compared to
0.70% in the third quarter. Annualized net charge-offs in the fourth quarter of
2003 represented 0.59% of average loans, compared to 0.55% for the third
quarter. The provision for loan losses for the fourth quarter was $4.8 million
and equaled net charge offs.
Shareholders' equity totaled $240.6 million at December 31, 2003 with a leverage
capital ratio of 6.0% and tangible capital of 4.5%. Outstanding common shares
totaled 46.3 million at year end. Book value per common share was $5.20 per
share as of December 31, 2003. Tangible book value per common share as of
December 31, 2003, was $4.40.
F.N.B. Corporation begins 2004 optimistic about its ability to perform. In
addition to releasing the fourth quarter and year-end performance information,
F.N.B. Corporation offers earnings guidance in the range of $1.26 to $1.32 per
diluted share for the year of 2004, driven by a stable net interest margin, and
an efficiency ratio of 55%. The dividend payout ratio is projected to be in the
range of 65 to 75%. We forecast net income in the first quarter, 2004, to be in
the range of $0.28 to $0.30 per diluted share.
On December 15, 2003, F.N.B.'s Board of Directors paid a quarterly cash dividend
of $0.24 per share on its common stock. This dividend represents a 14.3%
increase over the previous year's
F.N.B. Corporation Fourth Quarter and Year 2003 Earnings Page 4 of 4
fourth quarter dividend. F.N.B. has paid a dividend every year for the past 30
years. In recognition of this exceptional dividend history, Mergent Inc., a
provider of global business and financial information, named F.N.B. a "2003
Dividend Achiever," a designation received by fewer than 3% of the more than
10,000 U.S. publicly traded companies reviewed as part of Mergent's annual
study.
F.N.B. Corporation will host a conference call on Friday, January 23, 2004, at
10:30 a.m. (Eastern Standard Time) to discuss the fourth quarter results and
plans for continued profitability and growth. This conference call will be
available by dialing 1-800-346-7359, with the entry code #3044. For those unable
to listen to the live call, a replay will be available from January 23, 2004,
until 8 p.m. on January 30, 2003, by dialing 1-800-332-6854, with the entry code
#3044.
F.N.B. Corporation owns and operates First National Bank of Pennsylvania, First
National Trust Company, First National Investment Services Company, F.N.B.
Investment Advisors, Inc., First National Insurance Agency, Inc., and Regency
Finance Company. F.N.B. Corporation conducts business in Pennsylvania, Ohio, and
Tennessee. On December 17, 2003 F.N.B. Corporation began trading of its common
shares on the New York Stock Exchange (NYSE) under the symbol FNB.
# # #
This document contains "forward-looking statements" relating to present or
future trends or factors affecting the banking industry and specifically the
financial operations, markets and products of F.N.B. Corporation. These
forward-looking statements involve certain risks and uncertainties. There are a
number of important factors that could cause future results to differ materially
from historical performance or those projected. These include, but are not
limited to: (1) competitive pressures among depository institutions increase
significantly; (2) changes in the interest rate environment reduce interest
margins; (3) prepayment speeds, loan sale volumes, charge-offs and loan loss
provisions; (4) general economic conditions are less favorable than expected;
(5) legislative or regulatory changes adversely affect the businesses in which
F.N.B. is engaged; or (6) changes in the securities markets. F.N.B. undertakes
no obligation to release revisions to these forward-looking statements or to
reflect events or circumstances after the date of this release.
F.N.B. CORPORATION (PRO FORMA - POST SPIN)
(UNAUDITED)
(Dollars in thousands, except per share data)
2003 (1) FOR THE YEAR
--------------------------------------------- ENDED
FOURTH Third Second First DECEMBER 31,
Income statements QUARTER Quarter Quarter Quarter 2003
- ----------------- ----------- ----------- ----------- ----------- -----------
Interest income - taxable equivalent basis $ 63,411 $ 63,883 $ 66,199 $ 67,676 $ 261,169
Interest income $ 62,931 $ 63,291 $ 65,514 $ 66,961 $ 258,697
Interest expense 20,543 21,766 22,970 21,291 86,570
----------- ----------- ----------- ----------- -----------
Net interest income 42,388 41,525 42,544 45,670 172,127
Provision for loan losses 4,840 4,285 3,903 4,127 17,155
----------- ----------- ----------- ----------- -----------
Net interest income after provision 37,548 37,240 38,641 41,543 154,972
Service charges 8,465 8,643 8,607 8,425 34,140
Insurance commissions and fees 1,902 2,424 2,426 2,386 9,138
Securities commissions and fees 880 997 1,084 1,041 4,002
Trust income 1,705 1,829 1,994 1,769 7,297
Gain on sale of securities 62 733 772 2,420 3,987
Gain on sale of mortgage loans 301 962 818 782 2,863
Other 2,479 2,003 2,136 2,147 8,765
----------- ----------- ----------- ----------- -----------
Total non-interest income 15,794 17,591 17,837 18,970 70,192
Salaries and employee benefits 17,326 19,129 18,987 20,001 75,443
Occupancy and equipment 6,521 6,818 6,700 6,536 26,575
Amortization of intangibles 543 543 543 543 2,172
Merger expenses -- -- -- -- --
Other 10,719 10,611 10,081 10,209 41,620
----------- ----------- ----------- ----------- -----------
Total non-interest expense 35,109 37,101 36,311 37,289 145,810
----------- ----------- ----------- ----------- -----------
Income before income taxes 18,233 17,730 20,167 23,224 79,354
Income taxes 5,657 5,192 5,757 6,954 23,560
----------- ----------- ----------- ----------- -----------
NET INCOME $ 12,576 $ 12,538 $ 14,410 $ 16,270 $ 55,794
=========== =========== =========== =========== ===========
Basic earnings per share 0.27 0.27 0.31 0.35 1.21
Diluted earnings per share 0.27 0.27 0.31 0.35 1.19
Average basic shares outstanding 46,126,779 46,091,404 46,067,008 46,043,113 46,080,966
Average diluted shares outstanding 47,038,550 47,003,985 46,887,760 46,895,439 46,972,863
PERFORMANCE RATIOS
Return on average shareholders' equity 21.73% 21.60% 22.88% 26.40% 20.10%
Return on average assets 1.09% 1.09% 1.26% 1.52% 1.24%
Net interest margin (FTE) 4.05% 3.99% 4.12% 4.78% 4.21%
Yield on earning assets (FTE) 5.99% 6.06% 6.31% 6.97% 6.30%
Efficiency ratio (FTE) 58.92% 61.23% 58.57% 56.23% 58.68%
Per share amounts and shares outstanding have been restated for the 5% stock
dividend declared on April 28, 2003.
(1) The pro forma financial information includes adjustments to reflect amounts
which would have occurred had the spin-off occurred on January 1, 2003. Such
adjustments include recording of interest income and reduction of interest
expenses through the utilization of funds received in connection with the
spin-off, recording of intercompany borrowing which was previously eliminated,
reduction of goodwill related to the spin-off, the timing of the trust preferred
issuance and excluding restructuring charges. Refer to the Form 10Q for the
quarter ended September 30, 2003 for further information on these pro forma
adjustments.
F.N.B. CORPORATION (PRO FORMA - POST SPIN)
(UNAUDITED)
(Dollars in thousands) 2003 (1) FOR THE YEAR
------------------------------------------------------------- ENDED
FOURTH Third Second First DECEMBER 31,
Average balances QUARTER Quarter Quarter Quarter 2003
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Total assets $4,581,181 $4,553,981 $4,573,491 $4,345,497 $4,514,462
Earning assets 4,196,647 4,183,552 4,207,236 3,938,544 4,145,605
Securities 927,542 937,230 970,692 726,391 893,451
Loans, net of unearned 3,268,631 3,247,421 3,227,472 3,221,745 3,249,791
Allowance for loan losses 46,710 46,932 47,161 47,404 47,049
Intangibles 36,732 37,075 40,466 40,768 36,412
Non-interest bearing deposits 591,402 585,301 574,527 546,038 576,666
Interest bearing deposits 2,817,591 2,782,317 2,777,208 2,723,678 2,784,422
Total deposits 3,408,993 3,367,618 3,351,735 3,269,716 3,361,088
Short-term borrowings 329,234 372,881 369,709 246,239 322,577
Long-term debt 425,671 400,803 413,711 408,701 416,326
Trust preferred securities 126,737 125,000 125,000 125,000 96,469
Shareholders' equity 229,562 230,320 252,589 249,921 277,616
ASSET QUALITY DATA
Non-accrual loans $ 22,449 $ 23,633 $ 23,605 $ 21,404 $ 22,449
Restructured loans 5,719 5,779 6,099 5,975 5,719
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Non-performing loans 28,168 29,412 29,704 27,379 28,168
Other real estate owned 3,109 3,168 2,951 2,567 3,109
---------- ---------- ---------- ---------- ----------
Non-performing assets $ 31,277 $ 32,580 $ 32,655 $ 29,946 $ 31,277
========== ========== ========== ========== ==========
Net loan charge-offs $ 4,823 $ 4,492 $ 4,200 $ 4,485 $ 18,000
Allowance for loan losses 46,139 46,122 46,330 46,625 46,139
Non-performing loans / total loans 0.86% 0.90% 0.92% 0.86% 0.86%
Non-performing assets / total assets 0.69% 0.70% 0.70% 0.67% 0.69%
Allowance for loan losses / total loans 1.41% 1.42% 1.43% 1.46% 1.41%
Allowance for loan losses /
non-performing loans 163.80% 156.81% 155.97% 170.29% 163.80%
Net loan charge-offs (annualized) /
average loans 0.59% 0.55% 0.52% 0.56% 0.55%
BALANCES AT PERIOD END
Total assets $4,561,274 $4,625,183 $4,644,725 $4,459,197 $4,561,274
Earning assets 4,174,547 4,210,606 4,239,076 4,053,589 4,174,547
Securities 906,563 946,949 971,658 846,585 906,563
Mortgage loans held for sale 1,435 11,298 26,250 18,387 1,435
Loans, net of unearned 3,265,397 3,251,499 3,236,283 3,200,819 3,265,397
Goodwill 26,441 26,441 26,441 26,441 26,441
Non-interest bearing deposits 592,740 595,141 582,591 569,237 592,740
Interest bearing deposits 2,846,715 2,766,483 2,791,290 2,735,425 2,846,715
Total deposits 3,439,455 3,361,624 3,373,881 3,304,662 3,439,455
Short-term borrowings 239,458 456,805 428,913 308,489 239,458
Long-term debt 455,942 397,504 399,328 410,087 455,942
Trust preferred securities 128,866 125,000 125,000 125,000 128,866
Shareholders' equity 240,608 224,601 263,000 256,230 240,608
Book value per common share 5.20
Tangible book value per common share 4.40
F.N.B. CORPORATION
(UNAUDITED)
(Dollars in thousands, except per share data)
FOR THE YEAR
2003 ENDED DECEMBER 31,
----------------------------------------------------- -------------------------
FOURTH Third Second First
Income statements QUARTER Quarter Quarter Quarter 2003 2002
- ----------------- ----------- ----------- ----------- ----------- ----------- -----------
Interest income - taxable equivalent basis $ 106,351 $ 105,628 $ 110,239 $ 105,796 $ 428,014 $ 432,509
Interest income $ 105,327 $ 104,485 $ 108,991 $ 104,510 $ 423,313 $ 426,784
Interest expense 30,812 32,508 35,143 31,373 129,836 145,671
----------- ----------- ----------- ----------- ----------- -----------
Net interest income 74,515 71,977 73,848 73,137 293,477 281,113
Provision for loan losses 7,512 5,237 5,731 5,859 24,339 19,094
----------- ----------- ----------- ----------- ----------- -----------
Net interest income after provision 67,003 66,740 68,117 67,278 269,138 262,019
Service charges 12,818 13,514 13,499 12,424 52,255 46,941
Insurance commissions and fees 8,588 9,285 8,984 8,463 35,320 34,158
Securities commissions and fees 1,719 1,990 2,180 1,904 7,793 6,617
Trust income 2,468 2,530 2,675 2,392 10,065 9,334
Gain on sale of securities 85 740 874 693 2,392 1,915
Gain on sale of mortgage loans 937 1,218 3,590 2,708 8,453 6,468
Other 3,927 3,355 3,558 3,452 14,292 15,440
----------- ----------- ----------- ----------- ----------- -----------
Total non-interest income 30,542 32,632 35,360 32,036 130,570 120,873
Salaries and employee benefits 41,626 47,552 38,141 36,767 164,086 135,215
Occupancy and equipment 13,503 11,996 11,628 10,507 47,634 39,512
Amortization of intangibles 885 884 848 821 3,438 3,118
Merger expenses 221 -- -- 1,014 1,235 42,365
Other 25,216 40,059 17,226 16,429 98,930 69,234
----------- ----------- ----------- ----------- ----------- -----------
Total non-interest expense 81,451 100,491 67,843 65,538 315,323 289,444
Income before income taxes 16,094 (1,119) 35,634 33,776 84,385 93,448
Income taxes 5,773 (1,603) 10,978 10,448 25,596 30,113
----------- ----------- ----------- ----------- ----------- -----------
NET INCOME $ 10,321 $ 484 $ 24,656 $ 23,328 $ 58,789 $ 63,335
=========== =========== =========== =========== =========== ===========
Basic earnings per share 0.21 0.01 0.54 0.51 1.27 1.37
Diluted earnings per share 0.21 0.01 0.53 0.50 1.25 1.35
EARNINGS EXCLUDING MERGER
AND RESTRUCTURING EXPENSES $ 22,914 $ 21,691 $ 24,656 $ 23,987 $ 93,248 $ 94,398
=========== =========== =========== =========== =========== ===========
Basic earnings per share 0.49 0.47 0.54 0.52 2.02 2.05
Diluted earnings per share 0.49 0.46 0.53 0.51 1.99 2.01
Average basic shares outstanding 46,126,779 46,091,404 46,067,008 46,043,113 46,080,966 46,012,908
Average diluted shares outstanding 47,038,550 47,003,985 46,887,760 46,895,439 46,972,863 47,073,785
PERFORMANCE RATIOS
Return on average shareholders' equity 6.78% 0.32% 16.13% 15.58% 9.66% 10.97%
Return on average assets 0.50% 0.02% 1.20% 1.33% 0.74% 0.93%
Net interest margin (FTE) 4.08% 3.98% 4.11% 4.70% 4.20% 4.70%
Yield on earning assets (FTE) 5.74% 5.75% 6.03% 6.68% 6.03% 7.09%
Efficiency ratio (FTE) 75.95% 94.19% 60.65% 60.79% 72.74% 70.23%
PERFORMANCE RATIOS (EARNINGS EXCLUDING
MERGER AND RESTRUCTURING EXPENSES)
Return on average shareholders' equity 15.04% 14.14% 16.13% 16.02% 15.33% 16.34%
Return on average assets 1.10% 1.05% 1.20% 1.37% 1.17% 1.39%
Efficiency ratio (FTE) 59.38% 63.63% 60.65% 59.84% 60.87% 59.84%
Per share amounts and shares outstanding have been restated for the 5% stock
dividend declared on April 28, 2003.
F.N.B. CORPORATION
(UNAUDITED) FOR THE YEAR
(Dollars in thousands) 2003 ENDED DECEMBER 31,
------------------------------------------------------- -------------------------
FOURTH Third Second First
Average balances QUARTER Quarter Quarter Quarter 2003 2002
- ---------------- ---------- ---------- ---------- ---------- ---------- ----------
Total assets $8,255,478 $8,190,502 $8,209,473 $7,125,930 $7,947,343 $6,787,724
Earning assets 7,351,175 7,285,760 7,330,080 6,424,201 7,099,148 6,102,647
Securities 1,692,190 1,725,953 1,808,593 1,140,562 1,592,462 950,560
Loans, net of unearned 5,651,920 5,549,256 5,486,415 5,269,672 5,490,062 5,060,067
Allowance for loan losses 73,757 73,564 72,584 69,380 72,336 68,513
Intangibles 222,329 221,048 216,552 113,012 192,075 102,237
Non-interest bearing deposits 1,031,188 1,024,274 1,019,616 924,765 1,000,210 878,020
Interest bearing deposits 5,086,498 5,059,984 5,086,476 4,531,764 4,941,816 4,432,846
Total deposits 6,117,686 6,084,258 6,106,092 5,456,529 5,942,026 5,310,866
Short-term borrowings 675,999 672,674 642,171 493,898 621,806 407,407
Long-term debt 623,648 599,993 616,414 460,424 575,211 385,451
Trust preferred securities 127,172 125,000 125,000 7,512 96,579 --
Shareholders' equity 604,312 608,675 613,262 607,358 608,393 577,573
ASSET QUALITY DATA
Non-accrual loans $ 27,970 $ 27,924 $ 27,980 $ 26,301 $ 27,970 $ 22,294
Restructured loans 5,719 5,779 6,099 5,975 5,719 5,915
---------- ---------- ---------- ---------- ---------- ----------
Non-performing loans 33,689 33,703 34,079 32,276 33,689 28,209
Other real estate owned 3,109 4,633 4,592 3,995 3,109 4,729
---------- ---------- ---------- ---------- ---------- ----------
Non-performing assets $ 36,798 $ 38,336 $ 38,671 $ 36,271 $ 36,798 $ 32,938
========== ========== ========== ========== ========== ==========
Net loan charge-offs $ 5,674 $ 4,908 $ 4,855 $ 5,571 $ 21,008 $ 17,136
Allowance for loan losses 74,243 72,405 72,076 71,200 74,243 68,406
Non-performing loans / total loans 0.59% 0.61% 0.61% 0.60% 0.59% 0.54%
Non-performing assets / total assets 0.44% 0.46% 0.47% 0.45% 0.44% 0.46%
Allowance for loan losses / total loans 1.30% 1.30% 1.30% 1.31% 1.30% 1.31%
Allowance for loan losses /
non-performing loans 220.38% 214.83% 211.50% 220.60% 220.38% 242.50%
Net loan charge-offs (annualized) /
average loans 0.40% 0.35% 0.35% 0.43% 0.38% 0.34%
BALANCES AT PERIOD END
Total assets $8,312,438 $8,288,487 $8,266,396 $8,078,010 $8,312,438 $7,090,232
Earning assets 7,420,410 7,340,091 7,343,728 7,163,593 7,420,410 6,332,623
Securities 1,681,897 1,735,711 1,762,240 1,721,512 1,681,897 1,075,183
Mortgage loans held for sale 16,588 25,071 27,369 18,761 16,588 24,177
Loans, net of unearned 5,714,779 5,570,578 5,544,317 5,419,087 5,714,779 5,220,504
Goodwill 199,939 201,879 193,292 193,312 199,939 88,425
Non-interest bearing deposits 1,044,632 1,034,426 1,043,443 1,027,742 1,044,632 924,090
Interest bearing deposits 5,114,867 5,063,957 5,071,602 5,039,351 5,114,867 4,502,067
Total deposits 6,159,499 6,098,383 6,115,045 6,067,093 6,159,499 5,426,157
Short-term borrowings 573,507 781,029 713,401 565,945 573,507 515,780
Long-term debt 705,414 591,600 591,183 615,369 705,414 450,647
Trust preferred securities 170,104 125,000 125,000 125,000 170,104 --
Shareholders' equity 605,859 596,787 630,875 608,641 605,859 598,596
Book value per common share 13.08 13.61
Tangible book value per common share 8.31 11.07