Exhibit 99.1
Summit Financial Group Announces Q1 2004 Earnings; Diluted EPS
Increases 30.2% to $0.69
MOOREFIELD, W.Va--(BUSINESS WIRE)--April 15, 2004--SUMMIT
FINANCIAL GROUP, INC. (OTCBB:SMMF) today reported first quarter 2004
net income of $2,451,000 or $0.69 per diluted share, up 30.2 percent
on an earnings per share basis from the $1,864,000, or $0.53 per
diluted share, reported in the first quarter of 2003. Net income for
the first quarter of 2004 generated an annualized return on average
shareholders' equity of 16.77% and an annualized return on average
assets of 1.23% compared to first quarter 2003 ratios of 14.33% and
1.09%, respectively.
H. Charles Maddy, III, President and Chief Executive Officer
commented, "We are very pleased to begin 2004 with exceptionally
strong financial performance. Our three community banks increased
earnings 23% in first quarter 2004 over the same period in 2003, while
achieving 30% annualized loan growth and 15% annualized deposit growth
since year end 2003. Summit Financial, LLC, our mortgage banking unit
organized in the third quarter of 2003, contributed $244,000 to
Summit's first quarter 2004 consolidated net income, and we anticipate
its earnings contributions will become relatively more significant in
the remainder of 2004."
Summit Financial Group, Inc. is a financial holding company with
total assets of $809 million. Summit operates thirteen banking
locations through its three wholly owned community banks, Summit
Community Bank headquartered in Moorefield, West Virginia, Capital
State Bank, Inc. in Charleston, West Virginia, and Shenandoah Valley
National Bank in Winchester, Virginia. Summit also operates Summit
Financial, LLC, a residential mortgage loan originator located in
Herndon, Virginia.
This press release contains forward-looking statements as defined
by federal securities laws. These statements may address issues that
involve significant risks, uncertainties, estimates and assumptions
made by management. Actual results could differ materially from
current projections. Please refer to Summit's filings with the
Securities and Exchange Commission for a summary of important factors
that could affect Summit's forward-looking statements. Summit
undertakes no obligation to revise these statements following the date
of this press release.
SUMMIT FINANCIAL GROUP, INC. (OTCBB:SMMF)
Quarterly Performance Summary -- Q1 2004 vs Q1 2003
For the Quarter Percent
Ended Change
---------------------
Dollars in thousands, except per share
amounts 3/31/2004 3/31/2003
- -------------------------------------------------- ---------- --------
Condensed Statements of Income
Interest income
Loans, including fees $8,314 $7,495 10.9%
Securities 2,527 2,590 -2.4%
Other 32 46 -30.4%
---------- ----------
Total interest income 10,873 10,131 7.3%
---------- ----------
Interest expense
Deposits 2,414 2,625 -8.0%
Borrowings 1,857 1,837 1.1%
---------- ----------
Total interest expense 4,271 4,462 -4.3%
---------- ----------
Net interest income 6,602 5,669 16.5%
Provision for loan losses 233 218 6.9%
---------- ----------
Net interest income after provision
for loan losses 6,369 5,451 16.8%
---------- ----------
Noninterest income
Service fee income 509 339 50.1%
Mortgage origination revenue 4,319 139 3007.2%
Securities gains (losses) 20 41 -51.2%
Other income 94 54 74.1%
---------- ----------
Total noninterest income 4,942 573 762.5%
---------- ----------
Noninterest expense
Salaries and employee benefits 3,686 1,920 92.0%
Net occupancy expense 304 194 56.7%
Equipment expense 429 300 43.0%
Postage expense 1,353 52 2501.9%
Advertising 962 49 1863.3%
Other expenses 1,105 825 33.9%
---------- ----------
Total noninterest expense 7,839 3,340 134.7%
---------- ----------
Income before income taxes 3,472 2,684 29.4%
Income taxes 1,021 820 24.5%
---------- ----------
Net income $2,451 $1,864 31.5%
========== ==========
Per Share Data
Basic earnings $0.70 $0.53 32.1%
Diluted earnings $0.69 $0.53 30.2%
Average shares outstanding
Basic 3,510,063 3,503,930 0.2%
Diluted 3,553,392 3,529,886 0.7%
Performance Ratios
Return on average equity 16.77% 14.33% 17.0%
Return on average assets 1.23% 1.09% 12.8%
Net yield on earning assets - taxable
equivalent 3.67% 3.66% 0.3%
Efficiency ratio (A) 67.69% 53.09% 27.5%
NOTE: (A) - Excludes nonrecurring income and expense items and
amortization of intangibles.
SUMMIT FINANCIAL GROUP, INC. (OTCBB:SMMF)
Five Quarter Performance Summary
For the Quarter Ended
---------------------------------------------------
Dollars in
thousands,
except per share
amounts 3/31/2004 12/31/2003 9/30/2003 6/30/2003 3/31/2003
- ------------------ ---------------------------------------------------
Condensed State-
ments of Income
Interest income
Loans, including
fees $8,314 $8,096 $7,877 $7,697 $7,495
Securities 2,527 2,501 2,375 2,426 2,590
Other 32 37 42 46 46
---------------------------------------------------
Total interest
income 10,873 10,634 10,294 10,169 10,131
---------------------------------------------------
Interest expense
Deposits 2,414 2,390 2,467 2,516 2,625
Borrowings 1,857 1,862 1,885 1,952 1,837
---------------------------------------------------
Total interest
expense 4,271 4,252 4,352 4,468 4,462
---------------------------------------------------
Net interest
income 6,602 6,382 5,942 5,701 5,669
Provision for
loan losses 233 232 232 233 218
---------------------------------------------------
Net interest
income after
provision
for loan losses 6,369 6,150 5,710 5,468 5,451
---------------------------------------------------
Noninterest
income
Service fee
income 509 455 403 388 339
Mortgage
origination
revenue 4,319 2,604 211 184 139
Securities
gains
(losses) 20 105 - 66 41
Other income 94 480 196 159 54
---------------------------------------------------
Total noninterest
income 4,942 3,644 810 797 573
---------------------------------------------------
Noninterest
expense
Salaries and
employee
benefits 3,686 3,064 2,142 1,880 1,920
Nett occupancy
expense 304 240 223 210 194
Equipment
expense 429 383 326 311 300
Postage expense 1,353 781 103 49 52
Advertising 962 571 89 63 49
Other expenses 1,105 1,268 914 926 825
---------------------------------------------------
Total noninterest
expense 7,839 6,307 3,797 3,439 3,340
---------------------------------------------------
Income before
income taxes 3,472 3,487 2,723 2,826 2,684
Income taxes 1,021 994 880 818 820
---------------------------------------------------
Net income $2,451 $2,493 $1,843 $2,008 $1,864
===================================================
Per Share Data
Basic earnings $0.70 $0.71 $0.53 $0.57 $0.53
Diluted earnings $0.69 $0.70 $0.52 $0.57 $0.53
Average shares
outstanding
Basic 3,510,063 3,506,874 3,504,820 3,504,358 3,503,930
Diluted 3,553,392 3,541,296 3,554,700 3,534,643 3,529,886
Performance Ratios
Return on average
equity 16.77% 17.66% 13.36% 14.62% 14.33%
Return on average
assets 1.23% 1.30% 1.02% 1.12% 1.09%
Net yield on
earning assets -
taxable
equivalent 3.67% 3.69% 3.62% 3.54% 3.66%
Efficiency ratio (A)
67.69% 63.68% 56.30% 53.03% 53.09%
NOTE: (A) - Excludes nonrecurring income and expense items and
amortization of intangibles.
SUMMIT FINANCIAL GROUP, INC. (OTCBB:SMMF)
Segment Information
For the Quarter Ended March 31, 2004
Community Mortgage
Dollars in thousands Banking Banking Parent Eliminations Total
- ------------------------------- --------------------------------------
Condensed State-
ments of Income
Interest income $10,755 $207 $3 $(92) $10,873
Interest expense 4,169 89 105 (92) 4,271
---------- --------------------------------------
Net interest income 6,586 118 (102) - 6,602
Provision for loan
losses 233 - - - 233
---------- --------------------------------------
Net interest income
after provision
for loan losses 6,353 118 (102) - 6,369
---------- --------------------------------------
Noninterest income 624 4,318 888 (888) 4,942
Noninterest expense 3,600 4,062 1,065 (888) 7,839
---------- --------------------------------------
Income before income
taxes 3,377 374 (279) - 3,472
Income taxes 999 130 (108) - 1,021
---------- --------------------------------------
Net income $2,378 $244 $(171) $- $2,451
========== ======================================
Average assets $790,721 $9,417 $68,282 $(71,397)$797,023
========== ======================================
SUMMIT FINANCIAL GROUP, INC. (OTCBB:SMMF)
Segment Information
For the Quarter Ended March 31, 2003
Community Mortgage
Dollars in Banking Banking Parent Eliminations Total
thousands
- ---------------------------- --------- -------- ------------ ---------
Condensed State-
ments of Income
Interest income $10,134 $- $2 $(6) $10,130
Interest expense 4,413 - 54 (6) 4,461
---------- --------- -------- ------------ ---------
Net interest
income 5,721 - (52) - 5,669
Provision for
loan losses 218 - - - 218
---------- --------- -------- ------------ ---------
Net interest
income after
provision
for loan
losses 5,503 - (52) - 5,451
---------- --------- -------- ------------ ---------
Noninterest
income 454 139 782 (802) 573
Noninterest
expense 3,167 83 892 (802) 3,340
---------- --------- -------- ------------ ---------
Income before
income taxes 2,790 56 (162) - 2,684
Income taxes 854 19 (53) - 820
---------- --------- -------- ------------ ---------
Net income $1,936 $37 $(109) $- $1,864
========== ========= ======== ============ =========
Average assets $683,562 $2,278 $55,725 $(55,256) $686,309
========== ========= ======== ============ =========
SUMMIT FINANCIAL GROUP, INC. (OTCBB:SMMF)
Selected Balance Sheet Data
For the Quarter Ended
-------------------------------------------------------
Dollars in
thousands,
except per
share
amounts 3/31/2004 12/31/2003 9/30/2003 6/30/2004 3/31/2003
- -------------- ---------- ----------- ---------- ---------- ----------
Assets $809,216 $791,465 $744,173 $716,194 $710,892
Securities 215,732 235,409 223,607 217,538 231,560
Loans, net 542,451 504,693 474,489 456,242 436,020
Intangible
assets 3,612 3,050 3,088 3,126 3,163
Deposits 530,372 511,801 474,955 473,255 468,842
Short-term
borrowings 42,547 49,714 41,049 24,220 28,029
Long-term
borrowings
and
subordinated
debentures 169,608 168,255 169,135 159,369 156,322
Shareholders'
equity 60,674 57,188 55,502 55,873 53,379
Book value per
share $17.28 $16.30 $15.84 $15.94 $15.23
SUMMIT FINANCIAL GROUP, INC. (OTCBB:SMMF)
Asset Quality Information
For the Quarter Ended
-------------------------------------------------------
Dollars in
thousands 3/31/2004 12/31/2003 9/30/2003 6/30/2003 3/31/2003
- ------------------------- ----------- ---------- ---------- ----------
Net loan
charge-off's $192 $37 $46 $63 $142
Net loan
charge-off's
to average
loans
(annualized) 0.15% 0.03% 0.04% 0.06% 0.13%
Allowance for
loan losses $4,721 $4,681 $4,484 $4,298 $4,129
Allowance for
loan losses as
a percentage
of period end
loans 0.88% 0.93% 0.94% 0.94% 0.94%
Nonperforming
assets:
Nonperforming
loans $1,448 $1,356 $604 $1,056 $715
Foreclosed
properties 475 480 560 546 677
Nonaccrual
securities 389 396 399 405 412
---------- ----------- ---------- ---------- ----------
Total $2,312 $2,232 $1,563 $2,007 $1,804
========== =========== ========== ========== ==========
Nonperforming
loans to
period end
loans and
other real
estate 0.36% 0.36% 0.24% 0.35% 0.32%
========== =========== ========== ========== ==========
Nonperforming
assets to
period end
assets 0.29% 0.28% 0.21% 0.28% 0.25%
========== =========== ========== ========== ==========
SUMMIT FINANCIAL GROUP, INC. (OTCBB:SMMF)
Average Balance Sheet, Interest Earnings & Expenses and Average Rates
Q1 2004 vs Q1 2003
Q1 2004
--------- -------- -----
Average/ Earnings/ Yield/
Dollars in thousands Balances Expense Rate
- ------------------------------------------------------- -------- -----
ASSETS
Interest earning assets
Loans, net of unearned interest
Taxable $522,007 $8,217 6.30%
Tax-exempt 7,630 147 7.71%
Securities
Taxable 172,397 1,975 4.58%
Tax-exempt 48,288 825 6.83%
Interest bearing deposits other banks
and Federal funds sold 3,572 32 3.58%
--------- -------- -----
Total interest earning assets 753,894 11,196 5.94%
Noninterest earning assets
Cash & due from banks 9,965
Premises & equipment 18,777
Other assets 19,161
Allowance for loan losses (4,774)
---------
Total assets $797,023
=========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits $115,233 $253 0.88%
Savings deposits 48,053 56 0.47%
Time deposits 301,375 2,105 2.79%
Short-term borrowings 54,183 172 1.27%
Long-term borrowings and
subordinated debentures 165,465 1,685 4.07%
--------- -------- -----
684,309 4,271 2.50%
Noninterest bearing liabilities
Demand deposits 48,394
Other liabilities 5,847
---------
Total liabilities 738,550
Shareholders' equity 58,473
---------
Total liabilities and
shareholders' equity $797,023
=========
NET INTEREST EARNINGS $6,925
========
NET INTEREST YIELD ON EARNING ASSETS 3.67%
=====
Q1 2003
--------- -------- -----
Average/ Earnings/ Yield/
Dollars in thousands Balances Expense Rate
- ------------------------------------------------------- -------- -----
ASSETS
Interest earning assets
Loans, net of unearned interest
Taxable $422,953 $7,412 7.01%
Tax-exempt 6,208 127 8.18%
Securities
Taxable 174,478 2,114 4.85%
Tax-exempt 39,209 710 7.24%
Interest bearing deposits other banks
and Federal funds sold 6,724 45 2.68%
--------- -------- -----
Total interest earning assets 649,572 10,408 6.41%
Noninterest earning assets
Cash & due from banks 8,168
Premises & equipment 12,765
Other assets 19,895
Allowance for loan losses (4,091)
---------
Total assets $686,309
=========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Interest bearing liabilities
Interest bearing
demand deposits $99,283 $229 0.92%
Savings deposits 46,098 73 0.63%
Time deposits 273,566 2,323 3.40%
Short-term borrowings 21,337 80 1.50%
Long-term borrowings and
subordinated debentures 144,639 1,757 4.86%
--------- -------- -----
584,923 4,462 3.05%
Noninterest bearing liabilities
Demand deposits 44,217
Other liabilities 5,152
---------
Total liabilities 634,292
Shareholders' equity 52,017
---------
Total liabilities and
shareholders' equity $686,309
=========
NET INTEREST EARNINGS $5,946
========
NET INTEREST YIELD ON EARNING ASSETS 3.66%
=====
CONTACT: Summit Financial Group, Inc.
Robert S. Tissue, 304-530-0552
rtissue@SummitFGI.com