MANSFIELD, Pa., Oct. 20 /PRNewswire-FirstCall/ -- Citizens Financial Services, Incorporated (BULLETIN BOARD: CZFS) , parent company of First Citizens National Bank, has released its unaudited financial performance for the third quarter of 2006.
Net income for the three months ended September 30, 2006 was $1,548,000, which compares to $1,318,000 for the same period last year. This represents an increase of 17.5%. On a year-to-date basis, net income was $4,310,000 compared with $3,898,000 last year, an increase of 10.6%. Earnings per share for the year are $1.51 compared with $1.35 for the first nine months of 2005, representing an increase of 11.9%.
CEO and President Randall E. Black stated, "The current banking environment continues to remain a difficult and challenging one. Despite the recent pause in the Federal Reserve's monetary tightening policy during the second quarter, which has occurred steadily during the last two years, the sustained flat yield curve remains in effect. This has impacted our net interest margin as well as most financial institutions across the country and within our local service area."
Return on equity for the nine months ended September 30, 2006 and 2005 was 13.18% and 12.53%, respectively. For the three months ended September 30, 2006, return on equity was 14.03% compared with 12.55% for the same period in 2005. Mr. Black noted, "These results reflect our continued focus on managing our administrative costs and the implementation of tax planning strategies using tax-exempt investments and loans. In fact, our non-interest expenses for the nine months ended September 30, 2006 totaled $11,326,000 compared with $11,506,000 for 2005, a decrease of $180,000. For that same period, the provision for income taxes has decreased $245,000 even though income before taxes has increased $167,000."
Since September of last year, total assets have increased $51.1 million, or 10.0%. At the end of September, total assets were $560.7 million compared to $509.6 million last September. Net loans have increased $35.9 million since last September, an increase of 9.7%. Deposits have increased $17.5 million and borrowed funds have increased $31.5 million to fund the overall growth in assets.
Stockholders' Equity, excluding accumulated other comprehensive income, has increased $2.3 million, or 5.4% since last September. Book value per share at September 30, 2006 was $15.76 compared with $14.87 last year, an increase of 6.0%. In September, a cash dividend of $.22 per share was declared and will be paid to shareholders on October 27, 2006 to record holders as of October 13, 2006. This represents an increase of 4.8% over 2005's quarterly dividend.
Mr. Black also noted that "as planned, the construction of our new branch in Wellsville, New York is nearly completed and will be open for business on October 30, 2006. We continue to be optimistic about our potential to grow our bank in New York."
Citizens Financial Services, Inc., has over 1,500 shareholders, the majority of whom reside in Potter, Tioga, and Bradford counties, Pennsylvania and Allegany County, New York, where their 16 offices are located.
Note: This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. These factors include operating, legal and regulatory risks; changing economic and competitive conditions and other risks and uncertainties.
FINANCIAL HIGHLIGHTS
(UNAUDITED - IN THOUSANDS, EXCEPT PER SHARE AND RATIO DATA)
2006 2005
Nine Months Ended September 30
Net Income $4,310 $3,898
Comprehensive Income 4,833 2,855
Per common share data:
Earnings per share $1.51 $1.35
Cash dividends paid per share $0.64 $0.61
Performance Ratios:
Return on average assets (annualized) 1.06% 1.03%
Return on average equity (annualized) 13.18% 12.53%
Three Months Ended September 30
Net Income $1,548 $1,318
Per common share data:
Earnings per share $0.55 $0.46
Cash dividends paid per share $0.215 $0.205
Performance Ratios:
Return on average assets (annualized) 1.12% 1.03%
Return on average equity (annualized) 14.03% 12.55%
At September 30
Assets $560,654 $509,583
Investment securities:
Available for sale 103,301 90,512
Loans (net of unearned income) 411,610 375,518
Allowance for loan losses 3,841 3,666
Deposits 448,159 430,682
Stockholders' Equity 43,578 41,442
Non-performing assets 2,954 2,857
Average Leverage Ratio 7.91% 8.03%
Per common share data:
Book value $15.76 $14.87
Market value (average of bid/ask
price) $22.50 $20.30
Market price to book value ratio 142.79% 136.53%
Cash
Dividends
Common Stock Information: Bid Ask Paid
Quarter Ended:
September 30, 2006 $22.00 $23.00 $0.215
June 30, 2006 $21.60 $23.00 $0.215
March 31, 2006 $21.35 $23.25 $0.210
December 31, 2005 $20.80 $21.00 $0.210
September 30, 2005 $20.10 $20.50 $0.205
June 30, 2005 $21.00 $21.70 $0.205
March 31, 2005 $23.50 $24.25 $0.200
December 31, 2004 $23.65 $24.00 $0.200
CITIZENS FINANCIAL SERVICES, INC.
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
September 30 December 31 September 30
(in thousands except share data) 2006 2005 2005
ASSETS:
Cash and due from banks:
Noninterest-bearing $9,616 $8,498 $7,868
Interest-bearing 26 111 540
Total cash and cash equivalents 9,642 8,609 8,408
Available-for-sale securities 103,301 102,602 90,512
Loans (net of allowance for loan
losses: 407,769 379,139 371,852
2006, $3,841; December 31, 2005,
$3,664; and September 30, 2005, $3,666)
Premises and equipment 12,574 12,305 12,316
Accrued interest receivable 2,407 2,164 2,037
Goodwill 8,605 8,605 8,605
Bank owned life insurance 7,967 7,743 7,669
Other assets 8,389 8,074 8,184
TOTAL ASSETS $560,654 $529,241 $509,583
LIABILITIES:
Deposits:
Noninterest-bearing $49,741 $50,600 $52,246
Interest-bearing 398,418 379,199 378,436
Total deposits 448,159 429,799 430,682
Borrowed funds 64,295 52,674 32,814
Accrued interest payable 1,994 1,862 1,627
Commitment to purchase investments - 752 300
Other liabilities 2,628 2,593 2,718
TOTAL LIABILITIES 517,076 487,680 468,141
STOCKHOLDERS' EQUITY:
Common Stock
$1.00 par value; authorized
10,000,000 shares; issued
2,992,896 shares in 2006 and
2,965,257 in 2005, respectively 2,993 2,965 2,965
Additional paid-in capital 11,933 11,359 11,359
Retained earnings 33,140 31,251 30,472
TOTAL 48,066 45,575 44,796
Accumulated other comprehensive loss (1,018) (1,540) (880)
Less: Treasury Stock, at cost
162,674 shares for
2006 and 118,715 for 2005,
respectively (3,470) (2,474) (2,474)
TOTAL STOCKHOLDERS' EQUITY 43,578 41,561 41,442
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $560,654 $529,241 $509,583
CITIZENS FINANCIAL SERVICES, INC.
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
Three Months Ended Nine Months Ended
September 30, September 30,
(in thousands, except per
share data) 2006 2005 2006 2005
INTEREST INCOME:
Interest and fees on loans $7,226 $6,362 $20,639 $18,386
Interest-bearing deposits with
banks - 3 - 2
Investment securities:
Taxable 851 698 2,549 2,240
Nontaxable 232 153 679 394
Dividends 74 50 223 156
TOTAL INTEREST INCOME 8,383 7,266 24,090 21,178
INTEREST EXPENSE:
Deposits 3,067 2,416 8,390 6,840
Borrowed funds 849 383 2,388 1,140
TOTAL INTEREST EXPENSE 3,916 2,799 10,778 7,980
NET INTEREST INCOME 4,467 4,467 13,312 13,198
Provision for loan losses 105 30 225 30
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 4,362 4,437 13,087 13,168
NON-INTEREST INCOME:
Service charges 827 784 2,342 2,203
Trust 135 161 372 368
Brokerage 45 45 142 138
Insurance 32 61 88 205
Investment securities gains, net 5 - 4 -
Earnings on bank owned life
insurance 78 71 224 220
Other 91 109 364 334
TOTAL NON-INTEREST INCOME 1,213 1,231 3,536 3,468
NON-INTEREST EXPENSES:
Salaries and employee benefits 2,055 1,993 6,078 5,888
Occupancy 261 262 845 846
Furniture and equipment 146 156 442 491
Professional fees 125 132 371 408
Amortization 36 145 216 434
Other 1,075 1,133 3,374 3,439
TOTAL NON-INTEREST EXPENSES 3,698 3,821 11,326 11,506
Income before provision for
income taxes 1,877 1,847 5,297 5,130
Provision for income taxes 329 529 987 1,232
NET INCOME $1,548 $1,318 $4,310 $3,898
Earnings Per Share $0.55 $0.46 $1.51 $1.35
Cash Dividends Paid Per Share $0.215 $0.205 $0.640 $0.580
Weighted average number of
shares outstanding 2,835,763 2,874,181 2,850,211 2,887,619
