Exhibit 99.1
Cass Information Systems, Inc. reports
51% Increase in 2nd Quarter 2005 Earnings
ST. LOUIS - Cass Information Systems, Inc. (NASDAQ: CASS), the nation's
leading provider of freight, utility and telecom invoice payment, rating,
auditing and information services, reported second quarter earnings of 68 cents
per fully-diluted share, a 51% increase from the 45 cents reported for the
second quarter of 2004.
The Company reported net income for the quarter was up 52% to $2,584,000,
compared to the $1,700,000 in net income reported in the comparable quarter in
2004. Total revenues increased 21% or $3,290,000 over the same period last year.
"We are pleased to see a continuation of the Company's strong performance
through the second quarter," said Lawrence A. Collett, chief executive officer
and chairman of the board. "The results reflect growth in information processing
activity as well as an increase in investment revenues, aided by significant
improvement in sales from the company's software subsidiary."
Transportation invoices were up 27% and dollar volume rose 19% due to
increases from existing accounts and new business. Payment and processing fees
also increased as utility invoices processed were up 9% and include the August
2004 acquisition of its telecom group.
The Company's Government e-Management Solutions, Inc. or (GEMS) subsidiary
reported a 69% or $786,000 increase in software sales due to the market's
recognition of GEMS' enhanced product line.
Net investment income increased 23% or $1,449,000 largely due to growth in
funds generated from processing activities, increases in loans generated by the
Company's Cass Commercial Bank subsidiary, and the rise in the general level of
short-term interest rates.
Total operating expenses increased 13% or $1,685,000 as a result of its
telecom acquisition as well as increases in expenses relating to the growth in
payments processed. Cass' effective income tax rate rose from 28% to 35% due
primarily to the lower level of tax-exempt securities held during the quarter.
Six-Month 2005 Results
For the six-month period ended June 30, 2005, the Company earned $1.42 per
fully-diluted share, a 49% increase from the $.95 per fully-diluted share
reported for the six months ended June 30, 2004. Net income for the first half
of 2005 was $5,351,000, compared with $3,547,000 in the first six months of
2004. Total revenues rose $5,837,000 or 18 % for the first six months of the
year when compared with the same period of 2004 as a result of higher processing
volume, fee revenues, software sales and investment income. Operating expenses
increased $2,745,000 or 10% in the first six months of 2005 when compared with
the first six months of 2004.
"The first six months of 2005 are the strongest ever for the Cass
organization," Collett said. We believe the company's strategy is showing the
results of a growing information processing client base coupled with a greater
level of service options available to its customers and prospects."
Selected Consolidated Financial Data
The following table presents selected unaudited consolidated financial
data (in thousands, except per share data) for the periods ended June 30, 2005
and 2004:
Quarter Quarter Six Months Six Months
Ended Ended Ended Ended
6/30/05 6/30/04 6/30/05 6/30/04
Transportation Invoice Volume 7,503 5,921 14,635 11,350
Transportation Dollar Volume $2,869,289 $2,416,168 $5,437,379 $4,637,814
Utility Transaction Volume 1,401 1,286 2,804 2,570
Utility Dollar Volume $ 989,180 $ 895,730 $2,018,415 $1,830,091
Payment and Processing Fees $ 8,737 $ 7,621 $ 17,329 $ 15,219
Software Revenue 1,920 1,134 3,600 2,313
Net Investment Income 7,773 6,324 15,099 12,697
Gain on Sales of Debt Securities -- -- 547 441
Other 546 607 1,088 1,156
---------- ---------- ---------- ----------
Total Revenues $ 18,976 $ 15,686 $ 37,663 $ 31,826
Salaries and Benefits $ 10,610 $ 9,301 $ 20,954 $ 18,458
Occupancy 571 436 1,071 894
Equipment 830 986 1,667 2,011
Other 2,987 2,590 5,848 5,432
---------- ---------- ---------- ----------
Total Operating Expenses $ 14,998 $ 13,313 $ 29,540 $ 26,795
Income before Income Taxes $ 3,978 $ 2,373 $ 8,123 $ 5,031
Provision for Income Taxes $ 1,394 $ 673 $ 2,772 $ 1,484
Net Income $ 2,584 $ 1,700 $ 5,351 $ 3,547
Average Earning Assets $ 680,850 $ 627,453 $ 672,765 $ 613,338
Net Interest Margin 4.82% 4.33% 4.78% 4.45%
Allowance for Loan Losses to Loans 1.17% 1.24% 1.17% 1.24%
Non-performing Loans to Total Loans .13% .73% .13% .73%
Net Loan Charge-offs to Loans -- -- .08% --
Provision for Loan Losses $ 200 $ 150 $ 400 $ 350
Non-performing Loans $ 658 $ 3,467 $ 658 $ 3,467
Basic Earnings per Share $ .71 $ .47 $ 1.46 $ .97
Diluted Earnings per Share $ .68 $ .45 $ 1.42 $ .95
About Cass Information Systems
Cass has been a leading provider of payables services and information
support systems to companies throughout North America since 1956. The company
pays over $14 billion annually in freight and utility invoices on behalf of its
customers from processing centers in St. Louis, Mo., Columbus, Ohio, Boston,
Mass. and Greenville, S.C. The support of its bank subsidiary, Cass Commercial
Bank, founded in 1906, makes Cass Information Systems unique in the industry.
Note to Investors
Certain matters set forth in this news release may contain forward-looking
statements that are provided to assist in the understanding of anticipated
future financial performance. However, such performance involves risks and
uncertainties that may cause actual results to differ materially from those in
such statements. For a discussion of certain factors that may cause such
forward-looking statements to differ materially from the company's actual
results, see the company's reports filed from time to time with the Securities
and Exchange Commission including the company's annual report on Form 10-K for
the year ended December 31, 2004.