CITIZENS FINANCIAL SERVICES INC MANSFIELD, Pa., Jan. 22, 2015 /PRNewswire/ -- Citizens Financial Services, Inc. (OTC BB: CZFS), parent company of First Citizens Community Bank, has released its unaudited financial performance has released its unaudited financial performance for the three months and year ended December 31, 2014.
For the three months ended December 31, 2014, net income totaled $3,476,000 which compares to net income of $3,297,000 for the fourth quarter of 2013. This represents an increase of $179,000, or 5.4% over the fourth quarter of 2013. Basic earnings per share of $1.14 for the fourth quarter compares to $1.08 last year. Annualized return on equity was 14.01% and 14.21% for the three months ended December 31, 2014 and 2013, while return on assets was 1.52% and 1.47%, respectively.
For the year ended December 31, 2014, net income totaled $13,385,000 which compares to $13,375,000 for last year. This represents an increase of $10,000, or .1%. Basic earnings per share increased from $4.38 per share last year to $4.41 per share this year, an increase of 1%. Annualized return on equity for the comparable periods was 13.73% and 14.89%, while return on assets was 1.48% and 1.51%, respectively.
CEO and President Randall E. Black stated, "Despite managing multiple challenges throughout the year, including margin compression, sluggish loan demand, and ongoing and increasing regulatory burdens, we finished 2014 with our second highest net income on record. I believe this represents exceptional financial performance, particularly compared to peer, and is the direct result of our commitment to outstanding customer service and dedication to serving our communities and customers".
Net interest income, before the provision for loan losses, increased 1.4% from $29,919,000 for the year ended December 31, 2013, to $30,338,000 for 2014. While interest income for the year decreased $943,000, interest expense decreased $1,362,000 resulting in an overall increase in net interest income of $419,000 over the comparable period. Partially impacting the comparison for interest income is the recognition in the third quarter of 2013 of $305,000 of interest income from a loan that paid off that was previously on non-accrual status. The margin compressed slightly from 3.87% last year to 3.84% this year. Yields on interest earning assets, on a tax-effected basis, declined from 4.62% last year to 4.42% this year. As interest earning assets roll off or re-price, they are being replaced with lower yielding assets due to the continued low interest rate environment.
At December 31, 2014, total assets were $925 million, an increase of $10.1 million from total assets of $914.9 million at December 31, 2013. The investment portfolio, including interest bearing time deposits, has decreased $7.7 million from year-end 2013, while net loans of $547.3 million as of the end of December have increased $13.8 million, or 2.6%. In the fourth quarter alone, net loans have increased $10.4 million. Loan quality remains strong and continues to improve from the end of last year. At December 31, 2014, non-performing loans as a percent of total loans was 1.34%, which compares to 1.63% as of December 31, 2013. Annualized net charge-offs to average loans remains low at .16%.
Stockholders' equity totaled $100.5 million at December 31, 2014, which compares to $92.1 million at December 31, 2013. Net income of $13.4 million was offset by cash dividends of $6.6 million. Also, accumulated other comprehensive income increased $2.0 million from the end of 2013, which represents the net change in the unrealized gain on available for sale investment securities and unrecognized pension costs. The regular, quarterly cash dividend of $.40 per share was paid on December 22, 2014 to shareholders of record on December 15, 2014 and represents an increase of 3.9% over the quarterly cash dividend paid a year ago. For the year, adjusted for stock dividends, the cash dividend was $2.17 per share compared to last year's cash dividend of $1.21 per share. Dividends in 2014 include a one-time special dividend of $.60 per share paid in the third quarter. "Our sustained outstanding financial performance and strong capital position has permitted us to increase our dividends and reflects the Board of Directors' desire to provide total shareholder return to our shareholder base. We remain well-capitalized under regulatory capital guidelines, 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)
December 31 December 31
(in thousands except share data) 2014 2013
------------------------------- ---- ----
ASSETS:
Cash and due from banks:
Noninterest-bearing $10,091 $8,899
Interest-bearing 1,332 1,184
---------------- ----- -----
Total cash and cash equivalents 11,423 10,083
Interest bearing time deposits with other banks 5,960 2,480
Available-for-sale securities 306,146 317,301
Loans held for sale 497 278
Loans (net of allowance for loan losses: $6,815 at December 31, 2014 and
$7,098 at December 31, 2013) 547,290 533,514
Premises and equipment 12,357 11,105
Accrued interest receivable 3,644 3,728
Goodwill 10,256 10,256
Bank owned life insurance 20,309 14,679
Other assets 7,166 11,510
------------ ----- ------
TOTAL ASSETS $925,048 $914,934
============ ======== ========
LIABILITIES:
Deposits:
Noninterest-bearing $95,526 $85,585
Interest-bearing 678,407 662,731
---------------- ------- -------
Total deposits 773,933 748,316
Borrowed funds 41,799 66,932
Accrued interest payable 756 895
Other liabilities 8,032 6,735
----------------- ----- -----
TOTAL LIABILITIES 824,520 822,878
----------------- ------- -------
STOCKHOLDERS' EQUITY:
Preferred Stock $1.00 par value; authorized
3,000,000 shares at December 31, 2014 and December 31, 2013;
none issued in 2014 or 2013 - -
Common stock
$1.00 par value; authorized 15,000,000 shares at December 31, 2014 and
December 31, 2013; issued 3,335,236 shares at December 10, 2014 and 3,305,517
shares at December 31, 2013 3,335 3,306
Additional paid-in capital 25,150 23,562
Retained earnings 79,512 74,325
Accumulated other comprehensive income (loss) 767 (1,225)
Treasury stock, at cost: 296,280 shares at December 31, 2014 and 290,468 shares at
December 31, 2013 (8,236) (7,912)
------ ------
TOTAL STOCKHOLDERS' EQUITY 100,528 92,056
-------------------------- ------- ------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $925,048 $914,934
==================== ======== ========
CITIZENS FINANCIAL
SERVICES, INC.
CONSOLIDATED STATEMENT OF
INCOME
(UNAUDITED)
Three Months Ended Twelve Months Ended
December 31 December 31
----------- -----------
(in thousands, except per
share data) 2014 2013 2014 2013
------------------------- ---- ---- ---- ----
INTEREST INCOME:
Interest and fees on loans $7,124 $7,183 $28,324 $28,982
Interest-bearing deposits
with banks 31 13 82 40
Investment securities:
Taxable 795 917 3,337 3,721
Nontaxable 828 842 3,354 3,405
Dividends 35 25 194 86
--------- --- --- --- ---
TOTAL INTEREST INCOME 8,813 8,980 35,291 36,234
--------------------- ----- ----- ------ ------
INTEREST EXPENSE:
Deposits 1,056 1,213 4,347 5,107
Borrowed funds 155 257 606 1,208
-------------- --- --- --- -----
TOTAL INTEREST EXPENSE 1,211 1,470 4,953 6,315
---------------------- ----- ----- ----- -----
NET INTEREST INCOME 7,602 7,510 30,338 29,919
Provision for loan losses 105 90 585 405
------------------------- --- --- --- ---
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES 7,497 7,420 29,753 29,514
------------------------- ----- ----- ------ ------
NON-INTEREST INCOME:
Service charges 1,058 1,141 4,297 4,453
Trust 160 155 688 694
Brokerage and insurance 169 111 567 444
Gains on loans sold 126 207 236 443
Investment securities
gains, net 128 56 616 441
Earnings on bank owned
life insurance 141 125 507 502
Other 108 118 445 446
TOTAL NON-INTEREST INCOME 1,890 1,913 7,356 7,423
------------------------- ----- ----- ----- -----
NON-INTEREST EXPENSES:
Salaries and employee
benefits 2,905 2,936 11,505 11,392
Occupancy 320 315 1,287 1,271
Furniture and equipment 82 120 362 492
Professional fees 171 177 902 781
FDIC insurance 116 113 461 450
Pennsylvania shares tax 201 92 686 640
Other 1,212 1,374 4,962 4,784
----- ----- ----- ----- -----
TOTAL NON-INTEREST
EXPENSES 5,007 5,127 20,165 19,810
------------------ ----- ----- ------ ------
Income before provision
for income taxes 4,380 4,206 16,944 17,127
Provision for income taxes 904 910 3,559 3,752
-------------------------- --- --- ----- -----
NET INCOME $3,476 $3,296 $13,385 $13,375
========== ====== ====== ======= =======
PER COMMON SHARE DATA:
Net Income - Basic $1.14 $1.08 $4.41 $4.38
================== ===== ===== ===== =====
Net Income - Diluted $1.14 $1.08 $4.40 $4.38
==================== ===== ===== ===== =====
Cash Dividends Paid $0.400 $0.382 $2.173 $1.210
=================== ====== ====== ====== ======
Number of shares used in
computation -basic 3,036,175 3,041,721 3,038,298 3,055,033
Number of shares used in
computation -diluted 3,036,176 3,041,946 3,039,593 3,056,203
Financial Highlights
--------------------
Three Months Ended Twelve Months Ended
December 31, December 31,
2014 2013 2014 2013
Performance Ratios and Share Data:
Return on average assets (annualized) 1.52% 1.47% 1.48% 1.51%
Return on average equity (annualized) 14.01% 14.21% 13.73% 14.89%
Net interest margin (tax equivalent) 3.84% 3.78% 3.84% 3.87%
Cash dividends paid per share $0.400 $0.382 $2.173 $1.210
Earnings per share - basic $1.14 $1.08 $4.41 $4.38
Earnings per share - diluted $1.14 $1.08 $4.40 $4.38
Number of shares used in computation - basic 3,036,175 3,041,721 3,038,298 3,055,033
Number of shares used in computation - diluted 3,036,176 3,041,946 3,039,593 3,056,203
Balance Sheet Highlights (dollars in thousands): December 31, 2014 December 31, 2013
----------------- -----------------
Assets $925,048 $914,934
Investment securities:
Available for sale 306,146 317,301
Loans (net of unearned income) 554,105 540,612
Allowance for loan losses 6,815 7,098
Deposits 773,933 748,316
Stockholders' Equity 100,528 92,056
Non-performing assets 9,227 10,154
Non-performing assets to total loans 1.67% 1.88%
Annualized net charge-offs to total loans 0.16% 0.02%
Average Leverage Ratio 10.99% 10.42%
Common shares outstanding 3,038,956 3,015,049
Book value per share $32.83 $30.64
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SOURCE Citizens Financial Services, Inc.
