Exhibit 99.1
Atlantic Coast Federal Corporation Announces First Quarter Results
WAYCROSS, Ga.--(BUSINESS WIRE)--May 2, 2005--Atlantic Coast
Federal Corporation (NASDAQ/NM:ACFC), the holding company for Atlantic
Coast Federal, today announced improved financial results for the
first quarter ended March 31, 2005. Highlights of the quarter included
continued growth in total assets and the Company's loan portfolio,
which contributed to higher comparable net interest income. Also, the
Company's provision for loan losses in the first quarter declined from
the year-earlier amount, reflecting improved asset quality. These
changes were the primary factors that resulted in higher earnings for
the first quarter of 2005 versus the year-earlier period.
Commenting on the announcement, Robert J. Larison, Jr., President
and Chief Executive Officer, said, "It is very gratifying to see the
ongoing growth we are experiencing across our markets as we continue
to capitalize on our initial public stock offering in October 2004.
With enhanced financial strength, we continue to make strides in
building our average level of interest-earning assets and expanding
market share in the region. Most notably, our growth continues to
center on the metropolitan Jacksonville area, where we have seen a
positive response to our recent account initiatives. Our new checking
account program there helped boost deposits by more than $20 million
in the first quarter of 2005 versus the fourth quarter of 2004,
providing additional financial support for our loan growth
objectives."
For the first quarter of 2005, the Company's net interest income
increased 5% to $5.0 million from $4.7 million in the same quarter
last year. The provision for loan losses declined 66% in the first
quarter to $523,000 from $1.5 million in the year-earlier period
following the partial charge-off of one large commercial credit in the
first quarter last year. Asset quality continued to improve as net
charge-offs on an annualized basis dropped to 0.10% of average total
loans in the first quarter of 2005 from 0.63% in the fourth quarter of
2004 and 3.71% in the same quarter last year. Non-performing loans to
total loans stood at 1.11% at the end of the first quarter of 2005
versus 1.28% at December 31, 2004, and 1.09% for the first quarter of
2004.
The Company's net interest income, after provision for loan
losses, rose 39% in the first quarter to $4.4 million from $3.2
million in the comparable period last year. Non-interest income for
the quarter declined 5% from the year-earlier period primarily because
of lower gains on the sales of loans, and non-interest expense rose
12% primarily because of current costs associated with the Atlantic
Coast Federal Employee Stock Ownership Plan, which was implemented in
the fourth quarter of 2004, and increased outside professional
expenses. Net income for the first quarter increased 130% to $783,000
versus $341,000 in the year-earlier quarter. On a per share basis,
earnings per share doubled to $0.06 compared with $0.03 in the first
quarter of 2004.
As announced in late March, Atlantic Coast Federal Corporation's
Board of Directors has declared the Company's first cash dividend,
with the initial rate set at $0.05 per common share. The cash dividend
will be paid on May 2, 2005, to stockholders of record as of April 15,
2005. "We are pleased that the Company's solid performance and outlook
have enabled us to implement our dividend policy as planned," Larison
commented. "This policy should allow our stockholders to participate
in the progress we make, representing yet another way we can work to
enhance stockholder value."
The Company's total assets increased 6% to $674.2 million at March
31, 2005, from $637.7 million at December 31, 2004, and rose 8% from
$621.9 million in the year-earlier quarter. Net loans receivable
increased 6% to $547.5 million at March 31, 2005, from $517.7 million
at December 31, 2004, and were 20% higher than net loans receivable of
$456.7 million as of March 31, 2004. Deposits rose 6% to $461.4
million at the end of the first quarter of 2005 from $435.7 million at
December 31, 2004, but declined 6% from deposits of $492.1 million at
March 31, 2004. The year-over-year decline in deposits reflected a
run-up in deposits in 2004 in advance of the Company's subscription
offering for its common stock, much of which was used later by
depositors to purchase stock in the offering. Total stockholders'
equity increased 1% to $99.5 million at March 31, 2005, from $98.7
million as of December 31, 2004, and was 130% higher than
stockholders' equity of $43.3 million at March 31, 2004. The large
year-over-year increase in stockholders' equity reflected the
Company's October 2004 initial public offering of 5.8 million common
shares, which generated net proceeds to the Company of $51.7 million.
Returns on average total assets and stockholders' equity
(annualized) for the first quarter of 2005 were 0.48% and 3.18%,
respectively, versus 0.27% and 3.11%, respectively, for the comparable
period last year.
Concluding, Larison added, "We believe our results for the first
quarter represent a sound start to the new year. Our goal for 2005 is
to build on this momentum, and the economic climate in our markets,
particularly in the metropolitan Jacksonville area, remains conducive
to our growth plans. However, we recognize the challenge presented by
an increasingly competitive banking environment, which together with a
flattening yield curve and the ongoing change in the mix of our loans
will result in continued margin compression through the balance of the
year. Longer term, we think the mix of our loan portfolio will
continue to evolve and, coupled with our strategic efforts to grow
non-interest income, will result in a greater balance to our revenue
and improve our profitability."
Atlantic Coast Federal Corporation is the holding company for
Atlantic Coast Federal, a federally chartered and insured stock
savings association that was organized in 1939 as a credit union to
serve the employees of the Atlantic Coast Line Railroad. In November
2000, the credit union converted its charter from a federal credit
union to a federal mutual savings association and, in January 2003,
Atlantic Coast Federal Corporation was formed as the holding company.
The Company completed its initial public stock offering in October
2004. Investors may obtain additional information about Atlantic Coast
Federal Corporation on the Internet at www.acfederal.net, under the
Investor Information section.
Atlantic Coast Federal, with approximately $674 million in assets
as of March 31, 2005, is a community-oriented financial institution.
It serves southeastern Georgia and northeastern Florida through 13
offices, including a growing presence in the Jacksonville metropolitan
area.
This news release contains forward-looking statements within the
meaning of the federal securities laws, identified by words such as
"outlook," "should," "believe," "goal", "think," and "will," or
similar expressions. Such statements are subject to risks and
uncertainties, including but not limited to changes in national
economic conditions or those in Atlantic Coast Federal Corporation's
market area, changes in policies by regulatory agencies, fluctuations
in interest rates, demand for loans in Atlantic Coast Federal
Corporation's market area, changes in the position of banking
regulators on the adequacy of its allowance for loan losses, and
competition, all or some of which could cause actual results to differ
materially from historical earnings and those presently anticipated or
projected. Atlantic Coast Federal Corporation does not undertake, and
specifically disclaims any obligation, to update any forward-looking
statements to reflect occurrences or unanticipated events or
circumstances after the date of such statements.
ATLANTIC COAST FEDERAL CORPORATION
Unaudited Financial Highlights
(In thousands, except per share amounts)
Three Months Ended
March 31,
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2005 2004
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Total interest income $ 8,443 $ 7,540
Total interest expense 3,478 2,811
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Net interest income 4,965 4,729
Provision for loan losses 523 1,544
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Net interest income after provision for
loan losses 4,442 3,185
Non-interest income 1,287 1,354
Non-interest expense 4,507 4,035
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Income before income taxes 1,222 504
Income tax expense 439 163
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Net income $ 783 $ 341
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Basic and diluted earnings per share $ 0.06 $ 0.03
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Basic and diluted weighted average shares 14,129 8,729
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Dividends declared per share $ 0.05 $ --
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Mar. 31, Dec. 31,
2005 2004
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Total assets $674,240 $637,678
Cash and cash equivalents 35,191 25,708
Securities available for sale 50,214 53,363
Loans receivable, net 547,455 517,711
Total deposits 461,442 435,682
Federal Home Loan Bank advances 109,657 100,314
Stockholders' equity 99,519 98,700
Selected Consolidated Financial Ratios and Other Data (unaudited)
for the first quarter ended March 31, 2005 and 2004, may be found at
the following link: http://www.irinfo.com/acfc/1Q05fsp.pdf. Investors
should refer to the Company's Form 10-Q for the first quarter ended
March 31, 2005, for additional information and disclosures; the Form
10-Q will be available at the Investor Information section of the
Company's website immediately upon filing with the Securities and
Exchange Commission.
CONTACT: Corporate Communications, Inc.
Patrick J. Watson, 615-254-3376