Exhibit 99.1
July 24, 2007
Quarterly Report
Second Quarter 2007
We are pleased to report that our net income through the second quarter
ended June 30, 2007 was $3.5 million, which represented a 15.6% increase
over the $3.0 million earned through the second quarter ended June 30,
2006. After the effects of dilution, earnings per share for the year to
date equaled $1.21, which represented an 8.0% increase over the $1.12
earnings per share for the second quarter of 2006. Because our 2006
merger with Peoples Bancorp involved the issuance of Kentucky Bancshares
stock, our earnings per share was slightly impacted.
Net income for the three month period ended June 30, 2007 was $1.9
million which represented an 11.8% increase over the $1.7 million earned
for the three month period ended June 30, 2006.
As of June 30, 2007 total assets reached $642.3 million, a 16.1% increase
when compared to the $553.3 million as of June 30, 2006. Of that
increase in assets, loans totaled $430.5 million compared to $384.2
million or a 12.1% increase over loan balances at the end of June 30,
2006. Total deposits were up 26.6% over the quarter ended June 30, 2006,
and totaled $492.0 million as of June 30, 2007.
As was mentioned in our prior quarterly report, construction is under way
on our new retail banking center in Paris, which we purchased in 2006.
This work is coming along well, and we still anticipate that we will be
able to open this facility to our customers within the third quarter of
this year.
In Jessamine County we are continuing to move forward on our newly
purchased lot as we believe that the eventual new facility there will
certainly enhance our market presence in that community.
In Morehead we have recently begun construction, along with an official
groundbreaking for that particular site. We still expect that it will
take eight to ten months to construct this new full-service facility, and
we look forward to the impact it will have on our growth in Rowan County.
Additionally, we are very excited about the creation and communication of
a set of premier customer service standards with all of our
representatives. By all of us being committed to these standards, we can
distinguish ourselves from our competition while fulfilling the financial
needs of our customers.
As always, we thank you for your investment in your company and we will
work hard to reward your confidence in us.
Louis Prichard
President, CEO
UNAUDITED
CONSOLIDATED BALANCE SHEET
Percentage
6/30/2007 6/30/2006 Change
<s> <c> <c> <c>
Assets
Cash & Due From Banks $ 13,814,495 $ 14,803,215 -6.7%
Securities 124,552,170 125,496,578 -0.8
Loans Held for Sale 129,375 103,981 24.4
Loans 430,537,848 384,192,767 12.1
Reserve for Loan Losses 4,955,675 4,407,721 12.4
Net Loans 425,582,173 379,785,046 12.1
Federal Funds Sold 34,336,000 127,000 26936.2
Other Assets 43,870,572 33,027,847 32.8
Total Assets $ 642,284,785 $553,343,667 16.1%
Liabilities & Stockholders' Equity
Deposits
Demand $ 98,355,042 $ 77,260,984 27.3%
Savings & Interest Checking 159,365,171 134,209,671 18.7
Certificates of Deposit 234,284,067 177,158,693 32.2
Total Deposits 492,004,280 388,629,348 26.6
Repurchase Agreements 9,986,071 15,046,453 -33.6
Other Borrowed Funds 78,451,464 99,376,873 -21.1
Other Liabilities 6,306,593 3,488,089 80.8
Total Liabilities 586,748,408 506,540,763 15.8
Stockholders' Equity 55,536,377 46,802,904 18.7
Total Liabilities & Stockholders' Equity $ 642,284,785 $ 553,343,667 16.1%
CONSOLIDATED INCOME STATEMENT
Six Months Ending Three Months Ending
Percentage Percentage
6/30/2007 6/30/2006 Change 6/30/2007 6/30/2006 Change
<s> <c> <c> <c> <c> <c> <c>
Interest Income $19,840,321 $16,296,044 21.7% $10,033,758 $ 8,245,104 21.7%
Interest Expense 9,721,220 7,309,260 33.0 4,886,765 3,734,136 30.9
Net Interest Income 10,119,101 8,986,784 12.6 5,146,993 4,510,968 14.1
Loan Loss Provision 320,000 240,000 33.3 170,000 108,200 57.1
Net Interest Income After Provision 9,799,101 8,746,784 12.0 4,976,993 4,402,768 13.0
Other Income 4,040,821 3,301,159 22.4 2,144,631 1,704,900 25.8
Other Expenses 9,051,756 7,827,050 15.6 4,453,659 3,729,188 19.4
Income Before Taxes 4,788,166 4,220,893 13.4 2,667,965 2,378,480 12.2
Income Taxes 1,308,461 1,211,974 8.0 749,829 662,490 13.2
Net Income $ 3,479,705 $ 3,008,919 15.6 $ 1,918,136 $ 1,715,990 11.8
Net Change in Unrealized Gain (loss)
on Securities (1,380,264) (1,482,112) -6.9 (1,339,196) (778,738) 72.0
Comprehensive Income $ 2,099,441 $ 1,526,807 37.5% $ 578,940 $ 937,252 -38.2%
Selected Ratios
Return on Average Assets 1.08% 1.07% 1.20% 1.23%
Return on Average Equity 12.3 12.8 13.6 14.6
Earnings Per Share $ 1.22 $ 1.13 $ 0.67 $ 0.65
Earnings Per Share - assuming dilution 1.21 1.12 0.67 0.64
Cash Dividends Per Share 0.54 0.50 0.27 0.25
Book Value Per Share 19.43 17.51
Market Price High Low Close
Second Quarter '07 $30.50 $29.00 $30.50
First Quarter '07 $32.35 $30.00 $30.00