MANSFIELD, Pa., Oct. 18 /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 2007.
Net income for the three months ended September 30, 2007 was $1,754,000 which compares to $1,548,000 for the third quarter last year. This is an increase of $206,000, or 13.3%. On a year to date basis net income through September 30 was $4,894,000 compared with $4,310,000 last year, representing an increase of $584,000, or 13.5%. Earnings per share for the nine months ended September 30, 2007 and 2006 were $1.72 and $1.50 per share, respectively, representing a 14.7% increase. Return on equity for the comparable periods were 14.08% and 13.18%, respectively.
CEO and President Randall E. Black stated, "During the third quarter, we have begun to see some slight improvement in our net interest margin. The Federal Reserve's decision at its September meeting to cut the federal funds rate 50 basis points has resulted in a slight positive impact on the short- term end of the yield curve. This 50 basis point reduction, as expected, has had a greater impact on improving our margin by reducing the cost of our short term borrowing and deposit costs, compared to the reduction in interest rates on our prime based loan portfolio."
Net interest income before the provision for loan losses totaled $13,998,000, an increase of $686,000 compared to the first nine months a year ago, while non-interest expenses have increased only $195,000 for the same period. "We continue to examine ways to become a more efficient organization without sacrificing what we do best, serving the customer," stated Mr. Black.
Since September of last year, total assets have increased $23.5 million, or 4.2%. At the end of September total assets were $584.1 million, which compares to $560.7 million as of last September and $572.2 million as of December 31, 2006. Since last September, net loans have increased $7.6 million, an increase of 1.9%. Total deposits have increased $16.6 million while borrowed funds have increased $2.3 million.
Stockholders' equity, excluding accumulated other comprehensive income, has increased $3.3 million, or 7.4% since last September. Book value per share at September 30, 2007 was $16.89 compared with $15.76 last year, an increase of 7.2%. In October, a cash dividend of $.23 per share was declared and will be paid to shareholders on October 26, 2007 to record holders as of October 12, 2007, which represents an increase of 4.5% over the October 2006 dividend.
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.
CITIZENS FINANCIAL SERVICES, INC. CONSOLIDATED BALANCE SHEET (UNAUDITED) September 30 December 31 September 30 (in thousands except share data) 2007 2006 2006 ASSETS: Cash and due from banks: Noninterest-bearing $10,468 $10,007 $9,616 Interest-bearing 13 8 26 Total cash and cash equivalents 10,481 10,015 9,642 Available-for-sale securities 117,787 109,743 103,301 Loans (net of allowance for loan losses: 2007, $4,112; December 31, 2006, $3,876; and September 30, 2006, $3,841) 415,328 410,897 407,769 Premises and equipment 12,627 12,892 12,574 Accrued interest receivable 2,784 2,458 2,407 Goodwill 8,605 8,605 8,605 Bank owned life insurance 8,293 8,047 7,967 Other assets 8,217 9,511 8,389 TOTAL ASSETS $584,122 $572,168 $560,654 LIABILITIES: Deposits: Noninterest-bearing $53,867 $48,509 $49,741 Interest-bearing 410,869 398,006 398,418 Total deposits 464,736 446,515 448,159 Borrowed funds 66,593 75,775 64,295 Accrued interest payable 2,029 2,287 1,994 Other liabilities 4,296 4,091 2,628 TOTAL LIABILITIES 537,654 528,668 517,076 STOCKHOLDERS' EQUITY: Common Stock $1.00 par value; authorized, 10,000,000 shares; issued 3,020,537 shares in 2007 and 2,992,896 at December 31, 2006 and September 30, 2006 3,021 2,993 2,993 Additional paid-in capital 12,511 11,933 11,933 Retained earnings 36,399 34,007 33,140 Accumulated other comprehensive loss (1,426) (1,737) (1,018) Unearned restricted stock: 2,785 shares for 2007 and 0 shares for 2006 (65) - - Treasury Stock, at cost, 185,433 shares for 2007, 172,954 shares at December 31, 2006 and 162,674 shares at September 30, 2006 (3,972) (3,696) (3,470) TOTAL STOCKHOLDERS' EQUITY 46,468 43,500 43,578 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $584,122 $572,168 $560,654 CITIZENS FINANCIAL SERVICES, INC. CONSOLIDATED STATEMENT OF INCOME (UNAUDITED) Three Months Ended Nine Months Ended (in thousands, except per September 30, September 30, share data) 2007 2006 2007 2006 INTEREST INCOME: Interest and fees on loans $7,715 $7,226 $22,611 $20,639 Interest-bearing deposits with banks 4 - 4 - Investment securities: Taxable 1,130 851 3,201 2,549 Nontaxable 242 232 691 679 Dividends 88 74 257 223 TOTAL INTEREST INCOME 9,179 8,383 26,764 24,090 INTEREST EXPENSE: Deposits 3,366 3,067 10,106 8,390 Borrowed funds 928 849 2,660 2,388 TOTAL INTEREST EXPENSE 4,294 3,916 12,766 10,778 NET INTEREST INCOME 4,885 4,467 13,998 13,312 Provision for loan losses 60 105 225 225 NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 4,825 4,362 13,773 13,087 NON-INTEREST INCOME: Service charges 809 827 2,369 2,342 Trust 123 135 387 372 Brokerage and insurance 37 77 86 230 Investment securities gains, net 24 5 24 4 Gains on loans sold 18 11 82 24 Gains on sales of foreclosed properties - - 396 47 Earnings on bank owned life insurance 84 78 246 224 Other 83 80 306 293 TOTAL NON-INTEREST INCOME 1,178 1,213 3,896 3,536 NON-INTEREST EXPENSES: Salaries and employee benefits 2,130 2,055 6,256 6,078 Occupancy 268 261 877 845 Furniture and equipment 137 146 405 442 Professional fees 149 125 469 371 Amortization 36 36 108 216 Other 1,068 1,075 3,406 3,374 TOTAL NON-INTEREST EXPENSES 3,788 3,698 11,521 11,326 Income before provision for income taxes 2,215 1,877 6,148 5,297 Provision for income taxes 461 329 1,254 987 NET INCOME $1,754 $1,548 $4,894 $4,310 Earnings Per Share $0.62 $0.54 $1.72 $1.50 Cash Dividends Paid Per Share $0.225 $0.215 $0.670 $0.640 Weighted average number of shares outstanding 2,835,546 2,863,404 2,842,115 2,877,852 Financial Highlights 2007 2006 Nine Months Ended September 30 Net Income $4,894 $4,310 Comprehensive Income 5,205 4,833 Per common share data: Earnings per share $1.72 $1.50 Cash dividends paid per share $0.670 $0.640 Performance Ratios: Return on average assets (annualized) 1.13% 1.06% Return on average equity (annualized) 14.08% 13.18% Three Months Ended September 30 Net Income $1,754 $1,548 Per common share data: Earnings per share $0.62 $0.54 Cash dividends paid per share $0.225 $0.215 Performance Ratios: Return on average assets (annualized) 1.20% 1.12% Return on average equity (annualized) 14.85% 14.03% At September 30 Assets $584,122 $560,654 Investment securities: Available for sale 117,787 103,301 Loans (net of unearned income) 419,440 411,610 Allowance for loan losses 4,112 3,841 Deposits 464,736 448,159 Stockholders' Equity 46,468 43,578 Non-performing assets 2,527 3,141 Average Leverage Ratio 8.10% 7.91% Per common share data: Book value $16.89 $15.76 Market value (average of bid/ask price) 21.75 $22.50 Market price to book value ratio 128.75% 142.79% Cash Dividends Common Stock Information: Bid Ask Paid Quarter Ended: September 30, 2007 $21.50 $22.00 $0.225 June 30, 2007 $21.20 $22.50 $0.225 March 31, 2007 $22.55 $23.00 $0.220 December 31, 2006 $22.00 $23.50 $0.220 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
