CONTACTS: Mary K. Talbot
(401) 245-8819
SLADE'S FERRY BANCORP REPORTS EARNINGS AND
ANNOUNCES STOCK REPURCHASE PLAN
SOMERSET, Mass. (July 18, 2006) -- Slade's Ferry Bancorp (the "Company"),
(NASDAQ Capital Market: SFBC) parent company of Slade's Ferry Trust Company
(the "Bank"), announced that its net income for the quarter ended June 30, 2006
was $626,000 or $0.15 per share (diluted), a decrease of 26.2% over net income
for the quarter ended June 30, 2005, which totaled $848,000 or $0.21 per share
(diluted). For the six months ended June 30, 2006, net income was $1.5 million
or $0.37 per share (diluted), a decrease of 21.3% over net income for the six
months ended June 30, 2005, which totaled $1.9 million or $0.47 per share
(diluted).
The Company also announced that its Board of Directors has authorized a stock
repurchase plan pursuant to which the Company may repurchase up to 5%, or
208,036 shares, of its outstanding common stock, as a means of further
enhancing stockholder value. The repurchases will be made in the open market at
prevailing market prices or in privately negotiated transactions in accordance
with all applicable securities laws and regulations. Such repurchases will be
made from time to time, subject to market conditions, at the discretion of
Company management.
"We believe strongly in the fundamental strength of Slade's Ferry Bancorp,"
said President and CEO Mary Lynn Lenz. "Buying back our shares is a vote of
confidence in our business, our employees and our shareholders."
The decline in net income for the three and six month periods ended June 30,
2006 was primarily attributable to an increase in non-interest expense.
Non-interest expense increased $330,000 or 9.1%, to $4.0 million for the three
months ended June 30, 2006, and $765,000, or 11.0%, to $7.7 million for the six
months then ended. These increases were attributable to the additional
compensation expenses incurred with the implementation of FAS 123R, Accounting
for Stock Based Compensation, and the settlement accounting employed for
retired employees under FAS 88, Employers' Accounting for Settlements and
Curtailments of Defined Benefit Pension Plans and for Termination Benefits.
Additionally, non-interest expense for the six month period includes costs
related to the Assonet Branch which opened in March 2005.
Non-interest income increased by $6,000 and $140,000, respectively, for the
three and six month periods ended June 30, 2006. Included in non-interest
income are net losses on the sale of securities amounting to $172,000 and
$169,000, respectively, for the three and six month periods ended June 30,
2006. In June 2006, the Company recognized losses on the sale of certain
low-yielding investments in order to acquire higher yielding assets.
As a result of loan growth, total interest and dividend income increased from
$7.1 million for the quarter ended June 30, 2005, to $8.0 million for the
quarter ended June 30, 2006,
an increase of 13%. For the six months ended June 30, 2006, total interest and
dividend income was $15.9 million, compared to $13.8 million for the six months
ended June 30, 2006, an increase of 15.4%.
Total consolidated assets increased from $585.9 million at December 31, 2005 to
$605.4 million at June 30, 2006, an increase of 3.3%. Deposits increased from
$415.8 million at December 31, 2005 to $430.1 million at June 30, 2006, an
increase of 3.4%. During the same time period, net loans increased by $17.1
million, or 4.2%, to $426.7 million.
Total stockholders' equity at June 30, 2006 was $49.8 million compared to $48.9
million at December 31, 2005, an increase of 2.0%. Book value per share was
$11.97 at June 30, 2006 as compared to $11.82 at December 31, 2005. Both the
Company and the Bank maintain capital levels sufficient to be considered
"well-capitalized" under applicable regulatory capital guidelines and
requirements.
The Company declared a $0.09 dividend to common shareholders of record on June
20, 2006, which is payable on July 21, 2006.
Slade's Ferry Bancorp was founded to serve community-banking needs with both
personal and commercial products and services. With approximately $605 million
in assets and nine retail branches in Southeastern Massachusetts, Slade's Ferry
is a trusted community partner to both business and personal banking customers.
Traded on the NASDAQ Capital Market as SFBC, Slade's Ferry Bancorp can also be
found on the web at www.sladesferry.com and in seven Massachusetts communities
- - Assonet, Fairhaven, Fall River, New Bedford, Seekonk, Somerset and Swansea.
# # #
This news release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including statements
regarding the strength of the company's capital and asset quality. Other such
statements may be identified by words such as "believes," "will," "expects,"
"project," "may," "developments," "strategic," "launching," "opportunities,"
"anticipates," "estimates," "intends," "plans," "targets" and similar
expressions. These statements are based upon the current beliefs and
expectations of Slade's Ferry Bancorp's management and are subject to
significant risks and uncertainties. Actual results may differ materially from
those set forth in the forward-looking statements as a result of numerous
factors.
The following factors, among others, could cause actual results to differ
materially from the anticipated results or other expectation expressed in our
forward-looking statements: (1) enactment of adverse government regulations (2)
competitive pressures among depository and other financial institutions may
increase significantly and have an effect on pricing, spending, third-party
relationships and revenues; (3) the strength of the United States economy in
general and specifically the strength of the New England economics may be
different than expected, resulting in, among other things, a deterioration in
overall credit quality and borrowers' ability to service and repay loans, or a
reduced demand for credit, including the resultant effect on the Bank's loan
portfolio, levels of charge-offs and non-performing loans and allowance for
loan losses; (4) changes in the interest rate environment may reduce interest
margins and adversely
impact net interest income and (5) changes in assumptions used in making such
forward-looking statements. Should one or more of these risks materialize or
should underlying beliefs or assumptions prove incorrect, Slade's Ferry
Bancorp's actual results could differ materially from those discussed. All
subsequent written and oral forward-looking statements attributable to Slade's
Ferry Bancorp or any person acting on its behalf are expressly qualified in
their entirety by the cautionary statements set forth above. Slade's Ferry
Bancorp does not intend or undertake any obligation to update any
forward-looking statement to reflect circumstances or events that occur after
the date on which the forward-looking statements are made.
Slade's Ferry Bancorp. and Subsidiary
Consolidated Balance Sheets
(Unaudited)
June 30, 2006 December 31, 2005
------------- -----------------
Assets (In thousands)
- ------
Cash and due from banks $ 22,319 $ 17,782
Interest-bearing demand deposits with other banks 970 36
Federal funds sold 6,200 2,200
-------- --------
Cash and cash equivalents 29,489 20,018
Interest-bearing certificates of deposit with other banks 100 100
Securities available for sale 88,744 94,298
Securities held to maturity 27,235 29,306
Federal Home Loan Bank stock, at cost 6,304 6,304
Loans, net 426,678 409,610
Premises and equipment, net 5,746 5,917
Goodwill 2,173 2,173
Accrued interest receivable 2,091 2,298
Bank-owned life insurance 12,097 11,884
Other assets 4,696 4,006
-------- --------
$605,353 $585,914
======== ========
Liabilities and Stockholders' Equity
- ------------------------------------
Deposits:
Noninterest-bearing $ 80,710 $ 80,705
Interest-bearing 349,358 335,141
-------- --------
Total deposits 430,068 415,846
Short-term borrowings 10,000 7,000
Long-term borrowings 93,043 100,865
Subordinated debentures 10,310 10,310
Due to broker 9,509 --
Accrued expenses and other liabilities 2,575 3,038
-------- --------
Total liabilities 555,505 537,059
Stockholders' equity:
Common stock 42 41
Additional paid-in capital 31,608 31,014
Retained earnings 19,782 18,998
Accumulated other comprehensive loss (1,484) (1,198)
Unearned compensation (100) --
-------- --------
Total stockholders' equity 49,848 48,855
-------- --------
$605,353 $585,914
======== ========
Slade's Ferry Bancorp. and Subsidiary
Consolidated Statements of Income
(Unaudited)
Six Months Ended June 30,
2006 2005
-------- --------
(In thousands, except per
share data)
Interest and dividend income:
Interest and fees on loans $ 13,120 $ 10,993
Interest and dividends on securities 2,684 2,605
Other interest 82 168
-------- --------
Total interest and dividend income 15,886 13,766
Interest expense:
Interest on deposits 4,167 2,616
Interest on Federal Home Loan Bank advances 2,365 1,985
Interest on subordinated debentures 394 291
-------- --------
Total interest expense 6,926 4,892
-------- --------
Net interest and dividend income 8,960 8,874
Provision for loan losses 39 65
-------- --------
Net interest income, after provision for loan losses 8,921 8,809
Noninterest income:
Service charges on deposit accounts 659 420
Gain on sale of asset -- 51
Gain (loss) on sales and calls of available-for-sale
securities, net (169) 17
Other income 759 621
-------- --------
Total noninterest income 1,249 1,109
Noninterest expense:
Salaries and employee benefits 4,398 4,095
Occupancy and equipment expense 983 809
Other expense 2,321 2,033
-------- --------
Total noninterest expense 7,702 6,937
-------- --------
Income before income taxes 2,468 2,981
Provision for income taxes 935 1,033
-------- --------
Net income $ 1,533 $ 1,948
======== ========
Earnings per share:
Basic $ 0.37 $ 0.48
======== ========
Diluted $ 0.37 $ 0.47
======== ========
Slade's Ferry Bancorp. and Subsidiary
Consolidated Statements of Income
(Unaudited)
Three Months Ended June 30,
2006 2005
-------- --------
(In thousands, except per
share data)
Interest and dividend income:
Interest and fees on loans $ 6,685 $ 5,727
Interest and dividends on securities 1,282 1,283
Other interest 63 99
-------- --------
Total interest and dividend income 8,030 7,109
Interest expense:
Interest on deposits 2,256 1,457
Interest on Federal Home Loan Bank advances 1,209 1,074
Interest on subordinated debentures 170 155
-------- --------
Total interest expense 3,635 2,686
-------- --------
Net interest and dividend income 4,395 4,423
Provision for loan losses -- 15
-------- --------
Net interest income, after provision for loan losses 4,395 4,408
Noninterest income:
Service charges on deposit accounts 352 212
Gain on sales of assets -- 11
Gain (loss) on sales and calls of available-for-sale
securities, net (172) 15
Other income 366 302
-------- --------
Total noninterest income 546 540
Noninterest expense:
Salaries and employee benefits 2,287 2,120
Occupancy and equipment expense 490 400
Other expense 1,175 1,102
-------- --------
Total noninterest expense 3,952 3,622
-------- --------
Income before income taxes 989 1,326
Provision for income taxes 363 478
-------- --------
Net income $ 626 $ 848
======== ========
Earnings per share:
Basic $ 0.15 $ 0.21
======== ========
Diluted $ 0.15 $ 0.21
======== ========