EXHIBIT 99.1
FOR IMMEDIATE RELEASE
For: Evans Bancorp, Inc. Contact: Mark DeBacker, Treasurer
14-16 North Main Street Phone: (716) 926-2000
Angola, New York 14006 Fax: (716) 926-2005
EVANS BANCORP ANNOUNCES 6.5 PERCENT INCREASE IN SECOND QUARTER 2004 NET INCOME
ANGOLA, N.Y.-JULY 27, 2004-Evans Bancorp, Inc. (Nasdaq: EVBN), the holding
company for Evans National Bank, a commercial bank with nine branches in Western
New York, and approximately $391.2 million in assets, today reported strong
growth in revenue and income for the quarter ended June 30, 2004.
SECOND QUARTER 2004 PERFORMANCE HIGHLIGHTS:
- - NET INCOME GREW BY 6.5%, OR $66 THOUSAND, OVER SECOND QUARTER 2003
- - NET INTEREST INCOME GREW BY 18.1%, OR $485 THOUSAND, OVER SECOND QUARTER
2003
- - NON-INTEREST INCOME GREW BY 6.4% COMPARED WITH SECOND QUARTER 2003, AND
WAS 30.8% OF TOTAL REVENUE IN THE SECOND QUARTER 2004
- - GROSS LOANS GREW TO $201.2 MILLION, REFLECTING A 4.7% GROWTH RATE FOR THE
QUARTER
NET INCOME:
Net income was $1.1 million, or $0.44 per diluted share, for the quarter ended
June 30, 2004 as compared to $1.0 million, or $0.41 per diluted share, for the
quarter ended June 30, 2003. All 2003 per share amounts have been adjusted to
reflect the 5% stock dividend paid in December 2003.
"Our strong increase in net interest income for the quarter was a reflection of
our significant core deposit growth of more than 30% since year end 2003," said
James Tilley, President and Chief Executive Officer. "Net interest income for
the second quarter was up by 18.1%, compared to the second quarter of 2003.
Furthermore, insurance agency revenue was primarily responsible for the 6.4%
growth in non-interest income compared with the second quarter of 2003."
Net income for the first half of 2004 totaled $2.2 million, 7.7% higher than net
income of $2.1 million in the first half of 2003. For the six months ended June
30, 2004, diluted earnings per share increased 7.1% to $0.91 from $0.85 in the
corresponding 2003 period.
FINANCIAL POSITION:
Total assets decreased by 2.3%, to $391.2 million at June 30, 2004, compared to
$400.3 million at March 31, 2004. The decrease in total assets, which occurred
mostly as a reduction in federal funds sold, was primarily due to a decrease in
deposits held in the Company's municipal deposit program called Muni-Vest.
Typically, in the first quarter of each year, the Company experiences an influx
of tax deposits from municipalities which can be expected to decrease as they
pay expenses as the year progresses. The growth in the first part of the year
from Muni-Vest was due to this normal influx of tax deposits, supplemented
additionally by new municipal depositors. The Company expects as these deposits
are drawn down throughout the year, that they will be supplemented and offset
with growth of other core deposits.
Asset quality continues to remains strong with net charge offs of $3 thousand in
the second quarter of 2004. Non-performing loans totaled 0.31% of total loans
outstanding at June 30, 2004 as compared to
0.11% at March 31, 2004 and 0.49% at December 31, 2003. The allowance for loan
losses totaled $2.9 million or 1.42% of gross loans outstanding at June 30,
2004, as compared to $2.7 million, or 1.42% at March 31, 2004 and $2.5 million
at December 31, 2003, or 1.35%. Total gross loans have grown to $201.2 million
at June 30, 2004, reflecting a 4.7% or $9.1 million increase from March 31,
2004. Commercial loans increased 2.6% or $3.6 million and consumer loans
increased 9.8% or $5.4 million for the quarter.
OPERATIONAL RESULTS:
Net interest income of $3.2 million for the second quarter 2004 represented a
$0.5 million increase from the second quarter 2003, primarily as a result of
growth in interest-earning assets.
Non-interest income was $1.9 million for the second quarter 2004, an increase of
$0.1 million or 6.4% over the second quarter 2003. Insurance fee revenue
increased $0.2 million, or 21.2% over the prior year quarter and was partially
offset by a $0.1 million decline in loan-related fees. The increased insurance
fee revenue in the quarter was primarily the result of acquisitions of two
insurance agencies on January 2, 2004. The decrease in loan-related fees
reflected lower loan originations and sales volume in secondary markets compared
to second quarter 2003, which was a high point in a historic refinancing period.
Non-interest expense was $3.5 million for the second quarter 2004, an increase
of $0.5 million, or 15.4%, over the second quarter 2003. The primary component
of the increase was an increase of $0.3 million in salary and employee benefit
expense related to Company growth and merit pay increases awarded in early 2004.
Other miscellaneous expense increased by $0.1 million compared with the second
quarter 2003, due to a number of items including increased operating costs for
the M&W Agency insurance operations reflecting the two agency acquisitions
completed in January 2004, as well as other transaction-based expenses related
to the increased size and volume in the Bank's business.
SHARE REPURCHASE PROGRAM:
The Company has been active in repurchasing shares of its common stock on the
open market during the second quarter of 2004. During the quarter ended June 30,
2004, the Company purchased 10,100 shares of its common stock at an average cost
of $24.00 per share. The Company expects to remain active in repurchasing shares
of its common stock while conditions are deemed appropriate by management for
use in the Company's Dividend Reinvestment Plan, Employee Stock Purchase Plan,
Director and Officer Long-Term Incentive Plan and otherwise.
OUTLOOK:
"We are pleased with the Company's performance during the first half of 2004",
Tilley said. "Growth in our newer markets of Amherst and Lancaster have exceeded
our expectations. This success leads us with excitement and anticipation in
opening our North Buffalo branch at Delaware Avenue and Hinman Drive this fall."
Attached are Financial Highlights and Unaudited Consolidated Balance Sheets,
Statements of Income, and Condensed Consolidated Average Balance Sheets and
Annualized Rates for Evans Bancorp, Inc.
A conference call will be held with Company management at 11:00 a.m. (ET) on
Wednesday, July 28, 2004 to discuss performance results for the second quarter
2004 at 1-888-482-0024 (request Evans Bancorp Conference Call - passcode
44124051). An audio recording will be available one hour after the call through
August 4, 2004 at 12:00 p.m., and may be accessed at 1-888-286-8010, passcode
12355335.
The call will also be simultaneously broadcast live over the Internet through a
link located at the following location:
http://www.evansbancorp.com/investRel_conf.cfm and will be archived at the same
location, accessible for one year following the call. There is no charge to
access either event.
Evans Bancorp, Inc. is the holding company for Evans National Bank, a commercial
bank with nine branches located in Western New York, which had approximately
$391.2 million in assets and approximately $321.4 million in deposits at June
30, 2004. Evans National Bank also owns 100% of the capital stock of M&W Agency,
Inc., a retail property and casualty insurance agency with eleven offices in
Western New York, and 100% of the capital stock of 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 forward-looking
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
forward-looking 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. AND SUBSIDIARY
UNAUDITED FINANCIAL HIGHLIGHTS
Three months ended
June 30
2004 2003 Change
---------- ---------- ----------
(In thousands except share
PERFORMANCE and per share amounts)
Net Income $ 1,078 $ 1,012 6.5%
Per Common Share:
Basic earnings $ 0.44 $ 0.41 5.8%
Diluted earnings $ 0.44 $ 0.41 5.8%
Common shares outstanding:
Average - diluted 2,476,096 2,459,926 0.7%
Period end 2,468,199 2,444,285 1.0%
Return on (annualized):
Average total assets 1.10% 1.23%
Average stockholder's equity 12.91% 12.80%
Net interest income $ 3,163 $ 2,678 18.1%
Yield on average earning assets 4.85% 5.16%
Cost of interest-bearing liabilities 1.59% 1.95%
Net interest spread 3.26% 3.21%
Contribution of interest-free funds 0.26% 0.35%
Net interest margin 3.52% 3.56%
Net charge-offs to average total
loans (annualized) 0.01% 0.01%
LOAN QUALITY
Nonaccrual loans $ 289 $ 102
Accruing loans past due 90 days or more $ 340 $ 25
---------- ----------
Total non-performing loans $ 629 $ 127
Non-performing loans to total loans 0.31% 0.07%
Allowance for loan losses to total loans 1.42% 1.41%
EVANS BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
June 30, 2004 and December 31, 2003
June 30, December 31,
2004 2003
---------- ----------
(Unaudited)
(In thousands except share
ASSETS and per share amounts)
Cash and due from banks $ 10,521 $ 8,509
Interest bearing deposits at other banks 1,083 98
Securities:
Available-for-sale, at fair value 152,029 116,807
Held-to-maturity, at amortized cost 4,813 3,749
Loans, net 198,382 185,528
Properties and equipment, net 7,143 5,982
Goodwill 2,945 2,945
Intangible assets 1,827 1,177
Bank-owned life insurance 7,525 7,323
Other assets 4,883 2,559
---------- ----------
TOTAL ASSETS $ 391,151 $ 334,677
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Deposits:
Demand $ 53,810 $ 51,885
NOW and money market 12,254 11,464
Regular savings 154,427 105,599
Time deposits 100,865 97,377
---------- ----------
Total deposits 321,356 266,325
Other borrowed funds 24,287 25,388
Securities sold under agreements to repurchase 7,823 5,460
Other liabilities 4,708 4,180
---------- ----------
Total liabilities 358,174 301,353
---------- ----------
CONTINGENT LIABILITIES AND COMMITMENTS
STOCKHOLDERS' EQUITY
Common stock, $.50 par value; 10,000,000 shares authorized; 2,491,188 and
2,459,246 shares issued, respectively, and
2,468,199 and 2,444,285 shares outstanding, respectively 1,245 1,230
Capital surplus 20,148 19,359
Retained earnings 12,581 11,145
Accumulated other comprehensive (loss) income, net of tax (549) 1,918
Less: Treasury stock, at cost (18,742 and 14,961 shares, respectively) (448) (328)
---------- ----------
Total stockholders' equity 32,977 33,324
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 391,151 $ 334,677
========== ==========
EVANS BANCORP, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
Three Months and Six Months(Unaudited) ended June 30, 2004 and 2003
Three Months Ended Six Months Ended
June 30, June 30,
2004 2003 2004 2003
------------ ------------ ------------ ------------
(In thousands except share and (In thousands except share and
per share amounts) per share amounts)
INTEREST INCOME
Loans $ 2,885 $ 2,678 $ 5,656 $ 5,318
Federal funds sold & interest 30 15 51 63
on deposits in other banks
Securities:
Taxable 904 604 1,581 1,177
Non-taxable 539 581 1,093 1,141
------------ ------------ ------------ ------------
Total interest income 4,358 3,878 8,381 7,699
INTEREST EXPENSE
Interest on deposits 1,012 1,028 1,858 2,041
Interest on borrowings 183 172 363 293
------------ ------------ ------------ ------------
Total interest expense 1,195 1,200 2,221 2,334
NET INTEREST INCOME 3,163 2,678 6,160 5,365
PROVISION FOR LOAN LOSSES 136 120 272 240
------------ ------------ ------------ ------------
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 3,027 2,558 5,888 5,125
NON-INTEREST INCOME:
Service charges 480 452 910 902
Insurance services and fees 1,041 859 2,395 1,900
Commission fees 53 71 88 111
Net loss on sales of securities -- (37) 144 212
Premiums on loans sold 2 26 7 46
Other 362 451 725 789
------------ ------------ ------------ ------------
Total non-interest income 1,938 1,822 4,269 3,960
NON-INTEREST EXPENSE:
Salaries and employee benefits 1,876 1,600 3,855 3,286
Occupancy 397 342 806 747
Supplies 69 84 156 168
Repairs and maintenance 109 96 211 215
Advertising and public relations 89 71 173 147
Professional services 187 188 363 455
FDIC assessments 10 10 21 19
Other insurance 86 61 173 129
Other 722 621 1,422 1,218
------------ ------------ ------------ ------------
Total non-interest expense 3,545 3,073 7,180 6,384
------------ ------------ ------------ ------------
Income before income taxes 1,420 1,307 2,977 2,701
INCOME TAXES 342 295 730 615
------------ ------------ ------------ ------------
NET INCOME $ 1,078 $ 1,012 $ 2,247 $ 2,086
============ ============ ============ ============
Net income per common share-basic* $ 0.44 $ 0.41 $ 0.91 $ 0.85
============ ============ ============ ============
Net income per common share-diluted* $ 0.44 $ 0.41 $ 0.91 $ 0.85
============ ============ ============ ============
Weighted average number of common shares* 2,474,379 2,459,926 2,474,973 2,455,271
============ ============ ============ ============
Weighted average number of diluted shares* 2,476,096 2,459,926 2,476,881 2,455,271
============ ============ ============ ============
*2003 amounts have been adjusted for 5 percent stock dividend paid December 2003
EVANS BANCORP, INC AND SUBSIDIARY
UNAUDITED CONDENSED CONSOLIDATED AVERAGE BALANCE SHEETS AND ANNUALIZED RATES
Three Months ended June 30, 2004 and 2003
THREE MONTHS ENDED THREE MONTHS ENDED
JUNE 30, 2004 JUNE 30, 2003
AVERAGE INTEREST AVERAGE INTEREST
OUTSTANDING EARNED/ YIELD/ OUTSTANDING EARNED/ YIELD/
BALANCE PAID RATE BALANCE PAID RATE
(000) (000) (000) (000)
---------------- -------------- ----------- ------------------ -------------- -----------
ASSETS
Interest-earning assets:
Loans, net $192,691 $2,885 5.99% $162,642 $2,678 6.59%
Taxable investments 106,238 904 3.40% 82,014 604 2.96%
Tax-exempt investments 49,821 539 4.33% 52,893 581 4.39%
Time deposits-other bank 1,083 4 1.63% 877 6 2.63%
Federal funds sold 9,268 26 1.11% 2,117 9 4.60%
---------------- -------------- ----------- ------------------ -------------- -----------
Total interest-earning assets 359,101 4,358 4.85% 300,543 3,878 5.16%
============== ==============
Noninterest-earning assets
Cash and due from banks 10,642 8,390
Premises and equipment, net 6,516 5,404
Other assets 16,506 14,370
---------------- ------------------
Total Assets $392,765 $328,707
================ ==================
LIABILITIES & STOCKHOLDERS'
EQUITY
Interest-bearing liabilities:
NOW accounts $12,195 6 0.20% $10,600 $6 0.24%
Savings deposits 163,785 388 0.95% 113,053 292 1.03%
Time deposits 98,925 618 2.50% 101,105 730 2.88%
Fed funds purchased 551 1 0.89% 1,035 4 1.93%
Securities sold u/a to
repurchase 6,269 13 0.82% 5,240 13 1.01%
FHLB advances 18,526 164 3.54% 13,866 149 4.27%
Notes payable 724 5 2.63% 912 6 2.65%
---------------- -------------- ----------- ------------------ -------------- -----------
Total interest-bearing
liabilities 300,975 $1,195 1.59% 245,811 $1,200 1.95%
-------------- --------------
Noninterest-bearing liabilities:
Demand deposits 53,936 47,254
Other 4,443 4,014
---------------- ------------------
Total liabilities $359,354 $297,079
Stockholders' equity 33,411 31,628
---------------- ------------------
Total Liabilities and
Stockholders' Equity $392,765 $328,707
================ ==================
Net interest earnings $3,163 $2,678
============== ==============
Net yield on interest earning assets 3.52% 3.56%