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Contact: Contact Kenn Entringer at Casey Communications, Inc., (314) 721-2828
kentringer@caseycomm.com
October 19, 2006
Cass Information Systems, Inc. Posts
24% Increase in 3rd Quarter 2006 Earnings
ST. LOUIS - Cass Information Systems, Inc. (NASDAQ: CASS), the nation's
leading provider of transportation, utility and telecom invoice payment and
information services, reported third quarter 2006 earnings of $.46 per fully
diluted share, a 24% increase over the $.37 per fully diluted share (adjusted
for a September 15, 2006 50% stock dividend) reported for the third quarter of
2005. Net income for the period was $3,884,000 compared to $3,093,000 in 2005.
Earnings from continuing operations were $.47 per fully diluted share, a
24% increase over the $.38 per fully diluted share earned from continuing
operations in the same period of 2005. Net income from continuing operations was
$3,972,000 and $3,265,000 respectively. (The assets, liabilities and results of
a wholly-owned subsidiary sold by Cass in the fourth quarter of 2005 are shown
as discontinued operations.)
Payment and processing fees increased 13% or $1,202,000 compared to the
year-earlier period, as transportation invoices were up 6% and dollar volume
rose 17% due to new business and heightened activity from existing accounts.
Utility invoices processed were up 20%.
Net investment income increased 23% or $1,911,000 due mainly to growth in
funds generated from processing activities and to the rise in prevailing
interest rates.
Operating expenses were up 14% or $1,877,000 largely as a result of higher
employee costs related to transaction growth.
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Nine-Month 2006 Results
For the nine months ended September 30, 2006, the company earned $1.37 per
fully diluted share from continuing operations, a 32% increase from the $1.04
per fully diluted share reported for the same period in 2005. Net income from
continuing operations was $11,648,000, 32% higher than the $8,826,000 earned in
2005. Revenue rose $9,077,000 or 17% compared to the first nine months of 2005
due to increased processing volumes, fee revenues and investment income.
Operating expenses were up 11% or $4,404,000 in the nine-month
year-over-year period, mainly due to the increase in salaries and benefits
required to support processing growth.
Selected Consolidated Financial Data
The following table presents selected unaudited consolidated financial
data (in thousands, except per share data) for the periods ended September 30,
2006 and 2005:
Quarter Quarter Nine Months Nine Months
Ended Ended Ended Ended
9/30/06 9/30/05 9/30/06 9/30/05
------------ ------------ ------------ ------------
Transportation Invoice Volume 6,154 5,815 18,311 16,488
Transportation Dollar Volume $ 3,648,694 $ 3,111,175 $ 10,722,994 $ 8,548,554
Utility Transaction Volume 1,701 1,421 4,797 4,225
Utility Dollar Volume $ 1,538,628 $ 1,148,438 $ 4,188,578 $ 3,166,853
Payment and Processing Fees $ 10,359 $ 9,157 $ 29,853 $ 26,486
Net Investment Income 10,270 8,359 29,471 23,458
Gain on Sales of Debt Securities __ __ __ 547
Other 569 563 1,895 1,651
------------ ------------ ------------ ------------
Total Revenues $ 21,198 $ 18,079 $ 61,219 $ 52,142
------------ ------------ ------------ ------------
Salaries and Benefits $ 11,136 $ 9,600 $ 31,673 $ 28,280
Occupancy 522 499 1,462 1,443
Equipment 732 716 2,128 2,146
Other 2,631 2,329 7,911 6,901
------------ ------------ ------------ ------------
Total Operating Expenses $ 15,021 $ 13,144 $ 43,174 $ 38,770
------------ ------------ ------------ ------------
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Quarter Quarter Nine Months Nine Months
Ended Ended Ended Ended
9/30/06 9/30/05 9/30/06 9/30/05
------------ ------------ ------------ ------------
Income from Continuing Operations
before Income Taxes $ 6,177 $ 4,935 $ 18,045 $ 13,372
Provision for Income Taxes $ 2,205 $ 1,670 $ 6,397 $ 4,546
------------ ------------ ------------ ------------
Net Income from Continuing Operations $ 3,972 $ 3,265 $ 11,648 $ 8,826
Loss from Discontinued Operations net of
Income Taxes (88) (172) (277) (382)
------------ ------------ ------------ ------------
Net Income $ 3,884 $ 3,093 $ 11,371 $ 8,444
============ ============ ============ ============
Average Earning Assets $ 774,293 $ 700,442 $ 751,769 $ 682,092
Net Interest Margin 5.56% 4.98% 5.53% 4.85%
Allowance for Loan Losses to Loans 1.14% 1.20% 1.14% 1.20%
Non-performing Loans to Total Loans .18% .22% .18% .22%
Net Loan Charge-offs to Loans .11% __ .16% .08%
Provision for Loan Losses $ 200 $ 225 $ 500 $ 625
Non-performing Loans $ 954 $ 1,134 $ 954 $ 1,134
Basic Earnings per Share (EPS) from
Continuing Operations $ .48 $ .39 $ 1.40 $ 1.07
Basic EPS from Discontinued Operations (.01) (.02) (.03) (.05)
------------ ------------ ------------ ------------
Basic Earnings per Share $ .47 $ .37 $ 1.37 $ 1.02
============ ============ ============ ============
Diluted EPS from Continuing Operations $ .47 $ .38 $ 1.37 $ 1.04
Diluted EPS from Discontinued Operations (.01) (.01) (.03) (.04)
------------ ------------ ------------ ------------
Diluted Earnings per Share $ .46 $ .37 $ 1.34 $ 1.00
============ ============ ============ ============
About Cass Information Systems
Cass Information Systems is the leading provider of transportation,
utility and telecom invoice payment and information services. The company, which
has been involved in the payables services and information support business
since 1956, disburses over $16 billion annually on behalf of customers from
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processing centers in St. Louis, Mo., Columbus, Ohio, Boston, Mass. and
Greenville, S.C. The support of Cass Commercial Bank, founded in 1906, makes
Cass Information Systems unique in the industry. Cass is part of the Russell
2000(R) Index.
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, 2005.