Central Bancorp Reports Earnings for Its March 31, 2001 Fiscal Year and the Status of Its Common Stock Buyback Program.Business Editors SOMERVILLE Somerville. 1 City (1990 pop. 76,210), Middlesex co., E Mass., a residential and industrial suburb of Boston, on the Mystic River; settled 1630, set off from Charlestown 1842, inc. as a city 1871. , Mass.--(BUSINESS WIRE)--May 9, 2001 Central Bancorp, Inc., (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on National Market: CEBK) today reported net income of $567,000 or 34 cents per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, for the three months ended March 31, 2001, compared to net income of $802,000, or 44 cents per diluted share, for the March 31, 2000 quarter. For the year ended March 31, 2001, the Company recorded net income of $3,109,000, or $1.81 per diluted share, compared to $3,333,000, or $1.77 per diluted share, for the corresponding 2000 period after the cumulative effect of a required change in accounting principle. The earnings for the March 31, 2001 quarter primarily reflected a decline of $127,000 in net interest and dividend income, as general interest rate increases that went into effect during the second half of the Company's fiscal year contributed to higher costs for borrowings and deposits, as well as $141,000 less in gains on sales of investment securities stemming from the volatile stock market. The increase in Central Bancorp's interest expense was partially offset by higher interest income, mainly derived from a larger mortgage loan portfolio. For the fiscal year ended March 31, 2001, net interest and dividend income improved by $539,000 to $13,914,000, and, despite the decline in net income, earnings per diluted share improved over the prior fiscal year as a result of the stock buyback Stock buyback A corporation's purchase of its own outstanding stock, usually in order to raise the company's earnings per share. stock buyback See buyback. program. The lower net income as compared to the prior fiscal year principally resulted from a decline of $381,000 in non-interest income due to the decrease in gains on investment securities and higher operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. of $985,000, primarily due to a one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. expenditure relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the settlement of a severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when claim and to an increase in data processing data processing or information processing, operations (e.g., handling, merging, sorting, and computing) performed upon data in accordance with strictly defined procedures, such as recording and summarizing the financial transactions of a costs associated with the conversion to a new computer system. A required change in accounting principle in the first quarter of fiscal 2000 also impacted the period-to-period comparisons. John D. Doherty, President & Chief Executive Officer of Central Bancorp, Inc., noted, "Earnings per share after the cumulative effect of a required change in accounting principle improved during our most recent fiscal year although earnings on an absolute basis declined. Core earnings increased and total loans grew nearly $25,800,000 to $345,793,000, reflecting higher lending activity. These improvements occurred despite the continuing competitive pressures on interest rates. We also are pleased with the high quality of our loan portfolio, with no non-accruing loans (generally defined as loans 90 days or more past due) at March 31, 2001. Our balance sheet at March 31, 2001 grew from the year earlier levels, as deposits rose more than 11% to $287,167,000, stockholders' equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. improved to $38,212,0000, and total assets increased nearly 10% to $449,337,000." The Company is continuing its fourth common stock buyback program, announced in December 2000. An additional 79,458 shares remain authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: by that program. The shares repurchased since the first buyback Buyback The buying back of outstanding shares (repurchase) by a company in order to reduce the number of shares on the market. Companies will buyback shares either to increase the value of shares still available (reducing supply), or to eliminate any threats by shareholders who may program was adopted in April 1999 total 285,836, at an average cost of $18.30 per share, representing 14.51% of the common stock issued and outstanding prior to the adoption of the first buyback program. The Company plans to acquire additional shares in the months ahead through privately negotiated and/or open market purchases if market conditions are favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. . Central Bancorp, Inc., is the holding company for Central Bank, whose legal name is Central Co-operative Bank The Co-operative Bank is a co-operative bank trading in the United Kingdom with headquarters in Manchester, UK. It is an ethical bank, and refuses to invest in companies involved in the arms trade, genetic engineering, animal testing and use of sweated labour as stated in its , a Massachusetts-chartered co-operative bank operating eight full-service banking offices in suburban Boston. This earnings report may contain certain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , which are based on management's current expectations regarding economic, legislative and regulatory issues that may impact the Company's earnings in future periods. Factors that could cause future results to vary materially from current management expectations include, but are not limited to, general economic conditions, changes in interest rates, deposit flows, real estate values and competition; changes in accounting principles, policies or guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. ; changes in legislation or regulation; and other economic, competitive, governmental, regulatory and technological factors affecting the Company's operations, pricing, products and services.
Central Bancorp, Inc.
Consolidated Operating Data
(In Thousands, Except Per-Share Data)
Quarter Ended Year Ended
March 31, March 31,
2001 2000 2001 2000
(Unaudited)
Net interest and
dividend income $3,365 $3,492 $13,914 $13,375
Non-interest income 152 337 1,288 1,669
Operating expenses 2,629 2,596 10,330 9,345
Income before income taxes 888 1,233 4,872 5,699
Income tax expense 321 431 1,763 2,132
Net income before cumulative
effect of change in
accounting principle 567 802 3,109 3,567
Cumulative effect of change in
accounting principle,
net of taxes -- -- -- (234)
Net income $567 $802 $3,109 $3,333
Earnings per common share:
Before cumulative effect
of change in accounting
principle $0.34 $0.44 $1.81 $1.90
Before cumulative effect
of change in
accounting principle
- assuming dilution $0.34 $0.44 $1.81 $1.89
After cumulative effect
of change in
accounting principle $0.34 $0.44 $1.81 $1.77
After cumulative effect
of change in
accounting principle
- assuming dilution $0.34 $0.44 $1.81 $1.77
Central Bancorp, Inc.
Consolidated Balance Sheet Data
(In Thousands)
March 31,
2001 2000
Total assets $ 449,337 $ 409,557
Total loans 345,793 320,013
Allowance for loan losses 3,106 2,993
Deposits 287,167 258,339
Borrowings 121,000 111,000
Stockholders' equity 38,212 37,397
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