Citizens Financial Services, Inc. Reports First Quarter 2015 Earnings

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April 27, 2015 4:05 PM EDT

MANSFIELD, Pa., April 27, 2015 /PRNewswire/ -- Citizens Financial Services, Inc. (OTC BB: CZFS), parent company of First Citizens Community Bank, has released its unaudited financial performance for the three months ended March 31, 2015.

For the three months ended March 31, 2015, net income totaled $3,120,000 which compares to net income of $3,176,000 for the first quarter of 2014. This represents a decrease of $56,000, or 1.8%. Basic earnings per share of $1.03 for the first quarter compares to $1.04 last year.  Annualized return on equity for the comparable periods was 12.38% and 13.38%, while return on assets was 1.36% and 1.41%, respectively.

Net interest income after the provision for loan loss has increased from $7,332,000 for the three months ended March 31, 2014, to $7,467,000 for 2015.  Although interest income decreased $10,000, interest expense decreased $85,000 from last year's first quarter.  Additionally, the provision for loan losses decreased $60,000 for the comparable periods.  CEO and President Randall E. Black stated, "The margin has increased from 3.87% last year to 3.89%, which is impressive given the difficult economic environment that has been persistent in impacting us and others in our industry.  The prolonged interest rate environment has resulted in continued pressure on the tax-effected yield on our interest earning assets, which has decreased from 4.47% last year to 4.44% this year.  On a positive note, average interest earning assets has increased by $10.2 million compared to last year, which helped significantly in offsetting the decline in yields."  Notably, loan growth in the first quarter has resulted in an increase in average loans compared to last year of $20.9 million.  The cost of interest bearing liabilities has continued to decline, from .72% last year to .67% in 2015.

At March 31, 2015, total assets were $930.0 million, up from total assets of $902.6 million as of March 31, 2014 and up slightly from total assets of $925.0 million at December 31, 2014.  From year end 2014, the investment portfolio has decreased $14.2 million mostly due to unattractive yields in the market.  However, net loans of $558.3 million as of March 31, 2015 have increased $11.1 million, or 2%, compared to the end of last year.  The increase is partly attributable to the success in opening the new branch in the Mill Hall / Lock Haven market.  Asset quality remains strong with non-performing assets to total loans being 1.65% as of March 31, 2015 compared to 1.67% at year-end and 1.98% last March.  Annualized net charge-offs as a percent of average loans is very low at .01%.

Stockholders' equity totaled $102.3 million at March 31, 2015, which compares to $100.5 million at December 31, 2014 and $95.6 million at March 31, 2014.  For 2015, net income of $3.1 million was offset by cash dividends of $1.2 million and treasury share purchases of $1 million.  Additionally, the unrealized gain on available for sale investment securities increased $.8 million from the end of 2014 as a result of changes in interest rates impacting the fair value of investment securities.  The Company remains well-capitalized under regulatory capital guidelines.

A cash dividend of $.405 per share was paid on March 27, 2015 to shareholders of record on March 20, 2015.  This quarterly cash dividend was an increase of 6% over the dividend declared a year ago, adjusted for stock dividends.  "This increase in the dividend continues to reflect the Board of Directors' desire to provide total shareholder return to our shareholder base," added Mr. Black. 

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 18 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)

March 31

December 31

March 31

(in thousands except share data)

2015

2014

2014

ASSETS:

Cash and due from banks:

  Noninterest-bearing

$           10,901

$         10,091

$          10,642

  Interest-bearing

7,882

1,332

767

Total cash and cash equivalents

18,783

11,423

11,409

Interest bearing time deposits with other banks

5,960

5,960

2,480

Available-for-sale securities

291,904

306,146

310,983

Loans held for sale

1,029

497

242

Loans (net of allowance for loan losses: $6,922 at March 31, 2015;

    $6,815 at December 31, 2014 and $7,233 at March 31, 2014)

558,257

547,290

525,990

Premises and equipment

12,619

12,357

10,994

Accrued interest receivable

3,636

3,644

3,771

Goodwill

10,256

10,256

10,256

Bank owned life insurance

20,461

20,309

14,800

Other assets

7,067

7,166

11,701

TOTAL ASSETS

$         929,972

$       925,048

$        902,626

LIABILITIES:

Deposits:

  Noninterest-bearing

$         100,263

$         95,526

$          95,230

  Interest-bearing

688,513

678,407

658,413

Total deposits

788,776

773,933

753,643

Borrowed funds

29,388

41,799

45,728

Accrued interest payable

691

756

774

Other liabilities

8,828

8,032

6,897

TOTAL LIABILITIES

827,683

824,520

807,042

STOCKHOLDERS' EQUITY:

Preferred Stock $1.00 par value; authorized

  3,000,000 shares; none issued in 2015 or 2014

Common stock

  $1.00 par value; authorized 15,000,000 shares; issued 3,335,236 shares at March 31, 2015

   and December 31, 2014;  3,305,517 shares at March 31, 2014

3,335

3,335

3,306

Additional paid-in capital

25,148

25,150

23,623

Retained earnings

81,409

79,512

76,340

Accumulated other comprehensive income (loss)

1,603

767

154

Treasury stock, at cost:  314,704 shares at March 31, 2015; 296,280 shares at

  December 31, 2014 and 288,822 shares at March 31, 2014

(9,206)

(8,236)

(7,839)

TOTAL STOCKHOLDERS' EQUITY

102,289

100,528

95,584

TOTAL LIABILITIES AND

   STOCKHOLDERS' EQUITY

$         929,972

$       925,048

$        902,626

The accompanying notes are an integral part of these unaudited consolidated financial statements.

 

 

CITIZENS FINANCIAL SERVICES, INC.

CONSOLIDATED STATEMENT OF INCOME

(UNAUDITED)

Three Months Ended

March 31,

(in thousands, except per share data)

2015

2014

INTEREST INCOME:

Interest and fees on loans

$               7,039

$                 6,988

Interest-bearing deposits with banks

31

13

Investment securities:

    Taxable

754

888

    Nontaxable

848

842

    Dividends

99

50

TOTAL INTEREST INCOME

8,771

8,781

INTEREST EXPENSE:

Deposits

1,009

1,105

Borrowed funds

175

164

TOTAL INTEREST EXPENSE

1,184

1,269

NET INTEREST INCOME

7,587

7,512

Provision for loan losses

120

180

NET INTEREST INCOME AFTER

    PROVISION FOR LOAN LOSSES

7,467

7,332

NON-INTEREST INCOME:

Service charges

976

1,039

Trust

194

191

Brokerage and insurance

127

120

Gains on loans sold

38

40

Investment securities gains, net

126

171

Earnings on bank owned life insurance

152

121

Other

115

105

TOTAL NON-INTEREST INCOME

1,728

1,787

NON-INTEREST EXPENSES:

Salaries and employee benefits

3,056

2,917

Occupancy 

369

350

Furniture and equipment

128

100

Professional fees

232

234

FDIC insurance

116

113

Pennsylvania shares tax

201

193

Other

1,233

1,184

TOTAL NON-INTEREST EXPENSES

5,335

5,091

Income before provision for income taxes

3,860

4,028

Provision for income taxes

740

852

NET INCOME

$                3,120

$                 3,176

PER COMMON SHARE DATA:

Net Income - Basic

$                  1.03

$                   1.04

Net Income - Diluted

$                  1.03

$                   1.04

Cash Dividends Paid 

$                0.405

$                 0.382

Number of shares used in computation - basic

3,026,265

3,041,923

Number of shares used in computation - diluted

3,026,265

3,042,117

 

 

Financial Highlights

Three Months Ended

March 31

2015

2014

Performance Ratios and Share Data:

    Return on average assets (annualized)

1.36%

1.41%

    Return on average equity (annualized)

12.38%

13.38%

    Net interest margin (tax equivalent)

3.89%

3.87%

    Cash dividends paid per share 

$                       0.405

$                       0.382

    Earnings per share - basic

$                         1.03

$                         1.04

    Earnings per share - diluted

$                         1.03

$                         1.04

Number of shares used in computation - basic

3,026,265

3,041,923

Number of shares used in computation - diluted

3,026,265

3,042,117

Balance Sheet Highlights (dollars in thousands):

March 31, 2015

December 31, 2014

March 31, 2014

Assets

$                   929,972

$                   925,048

$                 902,626

Available-for-sale securities

291,904

306,146

310,983

Loans (net of unearned income)

565,179

554,105

533,223

Allowance for loan losses

6,922

6,815

7,233

Deposits

788,776

773,933

753,643

Stockholders' Equity

102,289

100,528

95,584

Non-performing assets

9,326

9,227

10,539

Non-performing assets to total loans

1.65%

1.67%

1.98%

Annualized net charge-offs to total loans

0.01%

0.16%

0.03%

Average Leverage Ratio

11.04%

10.99%

10.64%

Common shares outstanding

3,020,532

3,038,956

3,016,695

Book value per share

$                       33.33

$                       32.83

$                     31.33

 

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/citizens-financial-services-inc-reports-first-quarter-2015-earnings-300072755.html

SOURCE Citizens Financial Services, Inc.


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