Exhibit 99.1
July 31, 2014
Earnings Report
June 30, 2014
Dear Shareholders:
We are pleased to announce year to date net income increased 5.2% to
$3.68 million as of June 30, 2014 from $3.49 million as of June 30, 2013.
Year to date diluted earnings per share increased 5.4% to $1.36 from
$1.29 during the same period last year. The increase in year to date
earnings is largely attributable to higher net interest income and lower
provision expense.
Quarter to date net income increased from $1.79 million as of June 30,
2013 to $1.90 million as of June 30, 2014. Quarter to date diluted
earnings per share increased 6.1% to $0.70 from $0.66 during the same
period last year. The increase in quarterly earnings is primarily due to
higher net interest income and lower income tax expense relative to the
same period last year.
Total assets were $785.3 million at June 30, 2014, which represents a
10.7% increase from the period ended June 30, 2013. The overall net
increase in total assets was driven by a 14.1% increase in securities and
a 9.8% increase in net loans, which were funded by a 3.8% increase in
deposits and a 106.4% increase in other borrowed funds.
Our recent expansions into Madison and Fayette Counties continue to go
smoothly, and we remain committed to supporting all of our communities.
We are excited about the results of the Kentucky Bank Tennis
Championships, held from July 21-27, which is Kentucky's only
professional tennis event. This one-of-a-kind tournament brings national
and international attention to Central Kentucky and the entire state, and
we are proud to be the title sponsor for the event.
We continue to see an increase in lending opportunities which is
reflected in the increase in net loans compared to the same period last
year. While this increase is encouraging, the outlook on loan demand and
overall economic conditions remains uncertain which, when combined with
heightened regulatory pressure, continues to make for a challenging
banking environment. That said, we are moving forward with strategic
opportunities such as branch expansion, loan growth, and increased
service offerings in a measured manner to build and reaffirm a strong
foundation for future growth. We will do everything possible to
accomplish what is in the long term best interest of our shareholders,
customers, and employees.
As always, we appreciate your support.
/s/Louis Prichard
Louis Prichard
President, CEO
UNAUDITED
CONSOLIDATED BALANCE SHEET
Percentage
6/30/2014 6/30/2013 Change
<s> <c> <c> <c>
Assets
Cash & Due From Banks $ 14,951,211 $ 14,229,877 5.1%
Securities 224,167,851 196,435,636 14.1
Trading Assets 5,242,456 - n/a
Loans Held for Sale 495,158 418,600 18.3
Loans 496,134,147 452,244,676 9.7
Reserve for Loan Losses 5,614,398 5,497,774 2.1
Net Loans 490,519,749 446,746,902 9.8
Federal Funds Sold 88,000 76,000 15.8
Other Assets 49,831,954 51,248,111 -2.8
Total Assets $ 785,296,379 $ 709,155,126 10.7%
Liabilities & Stockholders' Equity
Deposits
Demand $ 157,987,820 $ 147,212,209 7.3%
Savings & Interest Checking 257,258,919 238,417,339 7.9
Certificates of Deposit 182,162,250 190,114,597 -4.2
Total Deposits 597,408,989 575,744,145 3.8
Repurchase Agreements 11,296,904 12,731,563 -11.3
Other Borrowed Funds 93,279,778 45,196,278 106.4
Other Liabilities 8,379,091 5,303,127 58.0
Total Liabilities 710,364,762 638,975,113 11.2
Stockholders' Equity 74,931,617 70,180,013 6.8
Total Liabilities & Stockholders' Equity $ 785,296,379 $ 709,155,126 10.7%
CONSOLIDATED INCOME STATEMENT
Six Months Ending Three Months Ending
Percentage Percentage
6/30/2014 6/30/2013 Change 6/30/2014 6/30/2013 Change
<s> <c> <c> <c> <c> <c> <c>
Interest Income $ 14,687,810 $ 13,792,916 6.5% $ 7,405,276 $ 6,837,165 8.3%
Interest Expense 1,859,440 1,637,927 13.5 926,266 816,244 13.5
Net Interest Income 12,828,370 12,154,989 5.5 6,479,010 6,020,921 7.6
Loan Loss Provision 200,000 600,000 -66.7 100,000 150,000 -33.3
Net Interest Income After Provision 12,628,370 11,554,989 9.3 6,379,010 5,870,921 8.7
Other Income 4,937,168 5,429,884 -9.1 2,668,784 2,827,632 -5.6
Other Expenses 13,229,336 12,620,721 4.8 6,775,445 6,444,636 5.1
Income Before Taxes 4,336,202 4,364,152 -0.6 2,272,349 2,253,917 0.8
Income Taxes 660,724 869,910 -24.0 368,307 468,690 -21.4
Net Income $ 3,675,478 $ 3,494,242 5.2% $ 1,904,042 $ 1,785,227 6.7%
Net Change in Unrealized Gain (Loss)
on Securities 4,980,702 (5,976,917) 183.3 1,729,473 (4,725,054) 136.6
Comprehensive Income (Loss) $ 8,656,180 $ (2,482,675) 448.7% $ 3,633,515 $(2,939,827) 223.6%
Selected Ratios
Return on Average Assets 0.94% 0.98% 0.97% 1.00%
Return on Average Equity 10.18 9.43 10.33 9.63
Earnings Per Share $ 1.36 $ 1.29 $ 0.70 $ 0.66
Earnings Per Share - assuming dilution 1.36 1.29 0.70 0.66
Cash Dividends Per Share 0.50 0.48 0.25 0.24
Book Value Per Share 27.54 25.78
Market Price High Low Close
Second Quarter '14 $27.50 $23.75 $26.74
First Quarter '14 24.80 23.90 24.75