Community Trust Bancorp, Inc. Reports Third Quarter 2003 Earnings of $7.3 Million or $0.60 Per Share.Business Editors PIKEVILLE Pikeville may refer to:
Community Trust 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 :CTBI CTBI Churches Together in Britain and Ireland ):
Earnings Summary
3Q 2Q 3Q 9 Months 9 Months
2003 2003 2002 2003 2002
--------------------------------------------
Net income (in thousands) $ 7,281 $ 7,064 $ 7,933 $21,338 $20,632
Earnings per share $ 0.60 $ 0.58 $ 0.64 $ 1.74 $ 1.65
Earnings per share
(diluted) $ 0.59 $ 0.57 $ 0.63 $ 1.72 $ 1.63
Return on average assets 1.15% 1.14% 1.30% 1.15% 1.12%
Return on average equity 13.45% 13.27% 15.32% 13.37% 13.74%
Efficiency ratio 58.84% 56.95% 55.92% 59.17% 56.74%
Dividends declared per
share $ 0.23 $ 0.21 $ 0.19 $ 0.65 $ 0.57
Book value per share $ 17.62 $ 17.47 $ 16.65
Community Trust Bancorp, Inc. (NASDAQ:CTBI) is reporting third quarter 2003 earnings of $7.3 million or $0.60 per share compared to $7.1 million or $0.58 per share earned during the second quarter of 2003 and $7.9 million or $0.64 per share earned during the third quarter of 2002. Third quarter 2002 earnings of $0.64 per share included $0.08 per share due to gains on sale of securities compared to $0.03 per share for the third quarter 2003. Earnings for the nine months ended September September: see month. 30, 2003 were $21.3 million or $1.74 per share, a 5.5% increase from the $20.6 million or $1.65 per share earned during the first nine months of 2002. Return on average assets for the quarter ended September 30, 2003 was 1.15% compared to 1.14% for the second quarter 2003 and 1.30% for the third quarter 2002. Return on average assets for the nine months ended September 30, 2003 increased 2.7% to 1.15% compared to 1.12% for the nine months ended September 30, 2002. Return on average shareholders' equity Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. for the quarter ended September 30, 2003 was 13.45% compared to 13.27% for the quarter ended June June: see month. 30, 2003 and 15.32% for the quarter ended September 30, 2002. Return on average shareholders' equity for the nine months ended September 30, 2003 was 13.37% compared to 13.74% for the nine months ended September 30, 2002. CTBI's efficiency ratio for the quarter ended September 30, 2003 was 58.84% compared to 55.92% for the same period in 2002. New Branch Opening The Company is pleased to announce the opening of an additional branch in Lexington, Kentucky Lexington, Kentucky, United States, known as the "Horse Capital of the World," is located in the heart of the Bluegrass region. It is the second-largest city in Kentucky, after Louisville, Kentucky,[1] and the 68th largest in the United States. on October October: see month. 6, 2003. The Company expects to open three new branches in the Company's Central Kentucky Central Kentucky is sometimes considered the Central and Southern part of the Bluegrass region, the Far Upper Western Eastern Mountain Coal Fields, and the Far Upper Eastern Pennyroyal regions. Its major cities include Lexington and Frankfort. region during the first half of 2004. Balance Sheet Review The Company's assets increased 3.3% to $2.5 billion at September 30, 2003 from $2.4 billion at September 30, 2002. The Company experienced an increase of $43 million in loans outstanding during the third quarter of 2003 as growth occurred in all three major loan categories, commercial, residential real estate, and consumer loans. The loan portfolio increased 3.3% to $1.7 billion from the $1.6 billion at September 30, 2002. Total deposits of $2.1 billion at September 30, 2003 represents an increase in deposits of $34 million from September 30, 2002. The Company continues to have a high level of liquidity since investment opportunities are limited with interest rates at 45-year lows. Nonperforming loans decreased 12.6% to $24.9 million from the $28.5 million at September 30, 2002 and increased 3.3% from the $24.1 million at June 30, 2003. Specific reserves are established for all large loans where management believes a loss may occur; therefore, no significant losses are anticipated except for those loans with specific reserve allocations. Foreclosed properties on September 30, 2003 were $3.7 million, an increase from the $3.5 million reported at June 30, 2003. Foreclosed properties consist primarily of 1-4 family residential real estate. The Company's continuing focus on loan portfolio quality is evident as net charge-offs for the quarter ended September 30, 2003 of $1.5 million, an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. rate of 0.4% of average loans, are approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 50% less than the $3.0 million or 0.7% of average loans for the third quarter of 2002 and 56% less than the $3.4 million or 0.8% of average loans for the second quarter of 2003. The reduction in net charge-offs had a positive impact by decreasing our loan loss provision by $1.5 million during the quarter ended September 30, 2003 compared to June 30, 2003 and $1.2 million for the nine months ended September 30, 2003 compared to the same period in 2002. Our reserve for losses on loans as a percentage of total loans outstanding at September 30, 2003 remained flat to prior quarter at 1.42% and decreased from 1.46% at September 30, 2002. The Company continues to grow its shareholders' equity while also providing a dividend yield of 3.03% to shareholders. Shareholders' equity of $215.3 million on September 30, 2003 is a 4.5% increase from the $206.0 million on September 30, 2002. Net Interest Income Our net interest margin of 3.62% for the quarter ended September 30, 2003 is a 13 basis point decrease from the 3.75% for the quarter ended June 30, 2003 and a 44 basis point decrease from the 4.06% for the quarter ended September 30, 2002. After the June 25, 2003 reduction in interest rates by the Federal Reserve, the Company's loans repriced more quickly than its deposits, resulting in pressure on the net interest margin during the third quarter of 2003. Management expects some improvement in its net interest margin during the fourth quarter of 2003 as deposits continue to reprice. Noninterest Income Noninterest income increased 16.2% for the quarter ended September 30, 2003 to $10.1 million from the $8.7 million earned during the same period in 2002. The change in noninterest income from prior year is primarily the result of increases in gains on sales of residential real estate loans due to increased refinancing Refinancing An extension and/or increase in amount of existing debt. activity, deposit service charge revenue, and other noninterest income consisting primarily of sold loan servicing Loan servicing is the process by which a mortgage bank or subservicing firm collects the timely payment of interest and principal from borrowers. The level of service varies depending on the type loan and the terms negotiated between the firm and the investor seeking their services. fee income. These increases were offset by decreased securities gains. This resulted in a positive after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. impact on quarter and year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. 2003 earnings of $0.9 million or $0.07 per share and $5.5 million or $0.45 per share, respectively. Gains on the sale of securities contributed $0.3 million or $0.03 per share to earnings for the third quarter 2003 and $2.0 million or $0.16 per share year-to-date compared to $1.0 million or $0.08 per share for the same periods in 2002. Gains on sales of loans increased for the third quarter and year-to-date 2003 contributing $1.0 million or $0.09 per share and $3.1 million or $0.25 per share, respectively, to net income, compared to $0.7 million or $0.06 per share and $1.5 million or $0.12 per share for the same periods in 2002. The increase in sold loan servicing fee income is due to the recapture recapture n. in income tax, the requirement that the taxpayer pay the amount of tax savings from past years due to accelerated depreciation or deferred capital gains upon sale of property. (See: income tax) RECAPTURE, war. of $0.7 million pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta from our valuation reserve because of the improvement in the fair market value of our capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. mortgage servicing Mortgage servicing The collection of monthly payments and penalties, record keeping, payment of insurance and taxes, and possible settlement of default , involved with a mortgage loan. rights. The impact to earnings per share for the quarter ended September 30, 2003 was $0.04 per share. Noninterest Expense Noninterest expense increased 7.9% from the $16.8 million for the third quarter 2002 to $18.1 million for the third quarter 2003. The increase in noninterest expense from prior year was primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to increases in professional fees, operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. , and other noninterest expense. 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. Certain of the statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and . The Company's actual results may differ materially from those included in the forward-looking statements. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "intend," "estimate," "may increase," "may fluctuate," and similar expressions or future or conditional Subject to change; dependent upon or granted based on the occurrence of a future, uncertain event. A conditional payment is the payment of a debt or obligation contingent upon the performance of a certain specified act. verbs such as "will," "should," "would," and "could." These forward-looking statements involve risks and uncertainties including, but not limited to, economic conditions, portfolio growth, the credit performance of the portfolios, including bankruptcies, and seasonal factors; changes in general economic conditions including the performance of financial markets, the performance of coal and coal related industries, prevailing inflation and interest rates, realized gains Realized Gain A gain resulting from selling an asset at a price higher than the original purchase price. Notes: There may be tax consequences for a realized profit. from sales of investments, gains from asset sales, and losses on commercial lending activities; results of various investment activities; the effects of competitors' pricing policies, of changes in laws and regulations on competition and of demographic See demographics. changes on target market populations' savings and financial planning Financial planning Evaluating the investing and financing options available to a firm. Planning includes attempting to make optimal decisions, projecting the consequences of these decisions for the firm in the form of a financial plan, and then comparing future performance against needs; industry changes in information technology systems on which we are highly dependent; failure of acquisitions to produce revenue enhancements revenue enhancement An increase in revenues, especially by way of increased taxes. Revenue enhancement includes reducing taxpayer deductions and eliminating tax credits. or cost savings at levels or within the time frames originally anticipated or unforeseen integration difficulties; the adoption by the Company of an FFIEC FFIEC Federal Financial Institutions Examination Council policy that provides guidance on the reporting of delinquent delinquent 1) adj. not paid in full amount or on time. 2) n. short for an underage violator of the law as in juvenile delinquent. DELINQUENT, civil law. He who has been guilty of some crime, offence or failure of duty. consumer loans and the timing of associated credit charge-offs for financial institution subsidiaries; and the resolution of legal proceedings All actions that are authorized or sanctioned by law and instituted in a court or a tribunal for the acquisition of rights or the enforcement of remedies. and related matters. In addition, the banking industry in general is subject to various monetary and fiscal policies and regulations, which include those determined by the Federal Reserve Board, the Federal Deposit Insurance Corporation Federal Deposit Insurance Corporation (FDIC), an independent U.S. federal executive agency designed to promote public confidence in banks and to provide insurance coverage for bank deposits up to $100,000. , and state regulators, whose policies and regulations could affect the Company's results. These statements are representative only on the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" , and the Company undertakes no obligation to update any forward-looking statements made. Community Trust Bancorp, Inc., with assets of $2.5 billion, is headquartered in Pikeville, Kentucky Pikeville is a city in Pike County, Kentucky, United States. The population was 6,295 at the 2000 census. It is the county seat of Pike CountyGR6. Pike County has a population of approximately 70,000. and has 69 banking locations across eastern, northern, central, and south central Kentucky South Central Kentucky is a cultural region of 22 Kentucky counties located roughly between I-65 in the Bowling Green area and I-75 around the London area, but within three counties of the Tennessee border and south of the "Golden Triangle" (the areas around Louisville, Lexington, , and 5 banking locations in southern West Virginia Southern West Virginia is a culturally and geographically distinct region in the U.S. state of West Virginia. Generally considered the heart of Appalachia, Southern West Virginia is known for its coal mining heritage and Southern affinity. . Additional information follows.
Community Trust Bancorp, Inc.
Financial Summary (Unaudited)
September 30, 2003
(in thousands except per share data)
Three Three Three Nine Nine
Months Months Months Months Months
Ended Ended Ended Ended Ended
9/30/03 6/30/03 9/30/02 9/30/03 9/30/02
-------- -------- -------- -------- --------
Interest income $ 31,420 $ 32,688 $ 35,924 $ 96,775 $111,789
Interest
expense 10,644 11,670 13,564 34,453 44,209
-------- -------- -------- -------- --------
Net interest
income 20,776 21,018 22,360 62,322 67,580
Loan loss
provision 2,085 3,585 2,530 7,217 8,416
Securities
gains 476 1,587 1,528 3,042 1,528
Gains on sales
of loans 1,613 1,595 1,016 4,729 2,347
Deposit service
charges 4,483 4,300 3,631 12,645 9,306
Trust revenue 604 634 546 1,851 1,702
Insurance
commissions 257 138 147 497 250
Other
noninterest
income 2,660 1,331 1,819 5,460 4,590
-------- -------- -------- -------- --------
Total
noninterest
income 10,093 9,585 8,687 28,224 19,723
Personnel
expense 8,705 7,838 8,742 25,604 25,594
Occupancy and
equipment 2,377 2,414 2,317 7,091 6,849
Amortization of
core deposit
intangible 145 145 145 435 435
Other
noninterest
expense 6,884 6,367 5,579 19,356 16,612
-------- -------- -------- -------- --------
Total
noninterest
expense 18,111 16,764 16,783 52,486 49,490
-------- -------- -------- -------- --------
Net income
before taxes 10,673 10,254 11,734 30,843 29,397
Income taxes 3,392 3,190 3,801 9,505 8,765
-------- -------- -------- -------- --------
Net income $ 7,281 $ 7,064 $ 7,933 $ 21,338 $ 20,632
======== ======== ======== ======== ========
Memo: TEQ
interest
income $ 31,806 $ 33,107 $ 36,417 $ 97,978 $113,238
Average shares
outstanding 12,207 12,253 12,452 12,255 12,517
Basic earnings
per share $ 0.60 $ 0.58 $ 0.64 $ 1.74 $ 1.65
Diluted
earnings per
share $ 0.59 $ 0.57 $ 0.63 $ 1.72 $ 1.63
Dividends per
share $ 0.23 $ 0.21 $ 0.19 $ 0.65 $ 0.57
Average
balances:
Loans, net of
unearned
income $1,659,808 $1,640,312 $1,647,011 $1,641,067 $1,668,194
Earning assets 2,316,603 2,290,802 2,232,150 2,292,061 2,271,065
Total assets 2,514,735 2,489,213 2,425,907 2,490,872 2,469,486
Deposits 2,130,906 2,117,223 2,075,122 2,116,108 2,113,194
Interest
bearing
liabilities 1,933,207 1,926,411 1,894,945 1,925,107 1,941,248
Shareholders'
equity 214,703 213,481 205,460 213,367 200,810
Performance
ratios:
Return on
average assets 1.15% 1.14% 1.30% 1.15% 1.12%
Return on
average equity 13.45% 13.27% 15.32% 13.37% 13.74%
Yield on
average
earning assets
(tax
equivalent) 5.45% 5.80% 6.47% 5.72% 6.67%
Cost of
interest
bearing funds
(tax
equivalent) 2.18% 2.43% 2.84% 2.39% 3.04%
Net interest
margin (tax
equivalent) 3.62% 3.75% 4.06% 3.71% 4.06%
Efficiency
ratio 58.84% 56.95% 55.92% 59.17% 56.74%
Loan charge-
offs $ (2,484) $ (4,136) $ (3,853) $ (9,457) $(11,246)
Recoveries 1,008 749 851 2,785 2,875
-------- -------- -------- -------- --------
Net charge-offs $ (1,476) $ (3,387) $ (3,002) $ (6,672) $ (8,371)
Market Price:
High $ 31.09 $ 30.00 $ 25.46 $ 31.09 $ 26.79
Low 26.14 25.25 20.59 24.70 19.79
Close 29.07 26.16 24.46 29.07 24.46
Community Trust Bancorp, Inc.
Financial Summary (Unaudited)
September 30, 2003
(in thousands except per share data)
As of As of As of
9/30/03 6/30/03 9/30/02
---------- ---------- ----------
Assets:
Loans, net of unearned $1,682,346 $1,639,804 $1,628,127
Loan loss reserve (23,816) (23,206) (23,694)
---------- ---------- ----------
Net loans 1,658,530 1,616,598 1,604,433
Loans held for sale 3,973 8,503 11,434
Securities AFS 518,690 466,150 475,776
Securities HTM 90,846 112,870 54,655
Other earning assets 1,282 67,499 46,532
Cash and due from banks 72,396 83,471 73,599
Premises and equipment 49,632 49,498 50,554
Goodwill and core deposit
intangible 64,096 64,241 64,676
Other assets 40,895 38,195 39,729
---------- ---------- ----------
Total Assets $2,500,340 $2,507,025 $2,421,389
========== ========== ==========
Liabilities and Equity:
NOW accounts $ 14,327 $ 15,538 $ 16,004
Savings deposits 608,360 614,532 614,727
CD's greater than =$100,000 365,332 361,301 352,336
Other time deposits 775,683 791,130 776,575
---------- ---------- ----------
Total interest bearing deposits 1,763,702 1,782,501 1,759,642
Noninterest bearing deposits 343,917 347,570 313,719
----------- ----------- -----------
Total deposits 2,107,619 2,130,071 2,073,361
Other interest bearing liabilities 156,521 145,726 123,880
Noninterest bearing liabilities 20,899 18,170 18,162
----------- ----------- -----------
Total liabilities 2,285,039 2,293,967 2,215,403
Shareholders' equity 215,301 213,058 205,986
----------- ----------- -----------
Total Liabilities and Equity $2,500,340 $2,507,025 $2,421,389
=========== =========== ===========
Ending shares outstanding 12,217 12,197 12,369
Memo: Market value of HTM
Securities $ 90,222 $ 114,046 $ 56,427
90 days past due loans $ 6,468 $ 5,164 $ 2,657
Nonaccrual loans 16,973 17,434 25,599
Restructured loans 1,506 1,546 284
Foreclosed properties 3,737 3,521 2,775
Tier 1 leverage ratio 8.46% 8.35% 8.19%
Tier 1 risk based ratio 11.17% 11.06% 11.18%
Total risk based ratio 12.42% 12.31% 12.43%
FTE employees 892 902 868
Community Trust Bancorp, Inc.
Financial Summary (Unaudited)
September 30, 2003
(in thousands except per share data)
Community Trust Bancorp, Inc. reported earnings for the three and
nine months ending September 30, 2003 and September 30, 2002 as
follows:
Three Months Ended Nine Months Ended
September 30 September 30
---------------------- ----------------------
2003 2002 2003 2002
---------- ---------- ---------- ----------
(in thousands except
per share information)
Net income $ 7,281 $ 7,933 $ 21,338 $ 20,632
Basic earnings per
share $ 0.60 $ 0.64 $ 1.74 $ 1.65
Diluted earnings per
share $ 0.59 $ 0.63 $ 1.72 $ 1.63
Average shares
outstanding 12,207 12,452 12,255 12,517
Total assets (end of
period) $2,500,340 $2,421,389
Return on average
equity 13.45% 15.32% 13.37% 13.74%
Return on average
assets 1.15% 1.30% 1.15% 1.12%
Provision for loan
losses $ 2,085 $ 2,530 $ 7,217 $ 8,416
Gains on sales of
loans $ 1,613 $ 1,016 $ 4,729 $ 2,347
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