DCB Financial Corp Announces Increased Second Quarter 2006 Earnings and Quarterly Dividend.LEWIS CENTER, Ohio Lewis Center is an unincorporated community in northwestern Orange Township, Delaware County, Ohio, United States, located between Columbus and Delaware. Its ZIP code is 43035. -- DCB DCB Dichlorobenzene DCB David Crowder Band DCB Dictionary of Canadian Biography DCB Device Control Block DCB Double Cantilever Beam DCB Disk Coprocessor Board DCB Dependent Care Benefits DCB Data Control Block DCB Direct Copper Bonding Financial Corp, (OTCBB OTCBB See OTC Bulletin Board (OTCBB). :DCBF DCBF Data Cache Block Flush DCBF Detail Catalog Binary File ) announced earnings of $1.89 million, or $0.50 per basic and 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 June June: see month. 30, 2006. This represents a $0.02, or 4.2% increase from the $0.48 basic and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of reported for the second quarter of 2005. The Corporation also reported earnings of $3.75 million, or $0.98 per basic and diluted share for the six months ended June 30, 2006, representing a $0.09, or 10.1% increase from the $0.89 earnings per share for the same period in 2005. Return on assets Return on assets (ROA) Indicator of profitability. Determined by dividing net income for the past 12 months by total average assets. Result is shown as a percentage. ROA can be decomposed into return on sales (net income/sales) multiplied by asset utilization (sales/assets). for the second quarter 2006 was 1.07%, while return on equity was 13.2%. With the continued ability to grow earnings, The Board of Directors also approved a $0.14 per share, payable August 15, 2006 to shareholders of record as of July July: see month. 31, 2006. President and Chief Executive Officer Jeffrey T. Benton Benton, city (1990 pop. 18,177), seat of Saline co., central Ark.; founded 1836. Once a significant aluminum producer, the city manufactures fabricated-metal and wood products. commented, "We are pleased to report increased earnings per share in a challenging environment, due to increased competition and rising interest rates. While our net interest margin has experienced significant pressure due to these forces, our noninterest income has increased and credit quality remains good. Our efficiency also continues to be among the best in Ohio." "The Bank continues to grow and our recent technology initiatives are doing well. We successfully introduced Smart Deposit Solutions, our new remote check capture product for commercial customers, and our new Smart ATM, with deposit image transfer capabilities. We are currently in the planning stages for several new branch locations to continue to take advantage of growth in our market area" Net Income Net income for the three months ended June 30, 2006 totaled $1.89 million, compared to net income of $1.88 million for the same period in 2005. Earnings per share was $.50 for the three months ended June 30, 2006 compared to $.48 for the three months ended June 30, 2005. The increase in earnings is mainly attributed to the increase in net interest income due to the growth in earning assets Earning Assets Any income-earning asset owned by a company. Notes: These assets are generally interest-bearing accounts, bonds, and securities available for sale. See also: Asset, Asset Valuation, Earnings, Net Interest Margin , and an increase in noninterest income associated with core product offerings. Net Interest Income Net interest income was $5.8 million for the three months ended June 30, 2006, compared to $5.7 million for the same period in 2005. The $155 thousand increase in the second quarter 2006 compared to 2005 was mainly attributed to an increase in loan balances, as average earning assets increased by $47 million from the second quarter 2005. The second quarter's net interest margin decreased to 3.57% on a fully tax equivalent basis, from 3.74% during the second quarter 2005. The decline is primarily attributed to funding continued loan growth through higher cost borrowings and deposits associated with the current interest rate environment. The Bank has seen deposit growth primarily in products such as time deposits and money market accounts, which generally carry higher costs compared to checking and savings products. Funding costs may further negatively impact the net interest margin in future periods if the current competitive and rising rate environments remain in effect. Noninterest Income Total noninterest income increased $76, or 5.4%, for the three months ended June 30, 2006, compared to the same period in 2005. The change in non-interest revenues from period to period is mainly attributed to an increase in service charges on deposit accounts coupled with an increase in treasury management fees. With The Bank's continued efforts to provide competitive products with real personal service, new products in the treasury management and wealth management divisions have been added. Noninterest Expense Total noninterest expense increased $312, or 8.0%, for the three months ended June 30, 2006, compared to the same period in 2005. The increase was primarily due to increases in salary and employee benefits expenses, professional expenses incurred, and franchise tax expenses incurred, offset with a decline in occupancy Gaining or having physical possession of real property subject to, or in the absence of, legal right or title. In a fire insurance policy, for example, the term occupancy , advertising and other administrative expenses. The increase in salary and benefits expense is mainly associated with the addition of revenue generating staff in lending and wealth management, in addition to compliance and credit personnel utilized to continue to improve the infrastructure supporting the Company's growth. Additionally, the Company has experienced an increase in consulting, auditing, and legal fees due to the expansion in the complexity of its operations. The Company's quarterly efficiency ratio fell slightly to 57.5% in the second quarter 2006 from 55.0% for the same period in 2005. Analysis of Selected Financial Condition The Corporation's assets totaled $704,481 at June 30, 2006, compared to $690,896 at December December: see month. 31, 2005, an increase of $13,585, or 2.0%. Since June 30, 2005 assets have increased $40,273 or 6.1% from $664,208. The increase in assets was mainly attributed to loan growth the Corporation experienced within its normal markets, particularly in commercial and residential real estate. The funding that accommodated this loan growth was supplied through increased borrowings, mainly Federal Home Loan Bank advances, and money market and wholesale deposits. Cash and cash equivalents increased $4,366, mainly due to Federal funds Federal Funds Funds deposited to regional Federal Reserve Banks by commercial banks, including funds in excess of reserve requirements. Notes: These non-interest bearing deposits are lent out at the Fed funds rate to other banks unable to meet overnight reserve sold, from December 31, 2005 to June 30, 2006. Total securities decreased $2,744, or 2.8%, from $96,580 at December 31, 2005 to $93,836 at June 30, 2006. All securities and investment securities classified as available for sale at June 30, 2006 totaled $93,836, or 100% of the total securities portfolio. Management classifies securities as available for sale to provide the Corporation with the flexibility to move funds into loans as demand warrants. The mortgage-backed securities Mortgage-backed securities (MSBs) Securities backed by a pool of mortgage loans. portfolio, totaling $36,604 at June 30, 2006, provides the Corporation with a constant cash flow stream from principal repayments and interest payments. The Corporation held no structured notes during any period presented. Total loans increased $37,041, or 7.0%, from $527,831 at June 30, 2005 to $564,872 at June 30, 2006. The increase is attributed mainly to the continued growth of residential real estate and home equity, real estate construction and land development, and commercial real estate loans. The Bank has recently seen loan balance declines from unscheduled unscheduled Adjective not planned or intended Adj. 1. unscheduled - not scheduled or not on a regular schedule; "an unscheduled meeting"; "the plane made an unscheduled stop at Gander for refueling" payoffs in the commercial portfolio due to irrational ir·ra·tion·al adj. Not rational; marked by a lack of accord with reason or sound judgment. irrational adjective Unreasonable, illogical competition pricing and from problem loan resolutions, which has improved overall credit quality. Other loan categories in which the Corporation participates, commercial, industrial, and consumer financing, remained relatively stable or experienced small increases in loans outstanding. The Bank's local market continues to experience increases in the amount of commercial real estate development activity. Total deposits increased $45,114, or 9.0%, from $503,906 at December 31, 2005 to $549,020 at June 30, 2006. This growth is mainly attributed to the increase in deposit activity from the Corporation's large public fund customers, brokered certificates of deposit and money market accounts. The Bank had approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $37,175 in brokered certificates of deposit outstanding at June 30, 2006. The slower growth of core deposits is attributed to the competition in the Corporation's geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. area, where the increase in competitors' branch locations have made it increasingly difficult to obtain deposits. Management intends to continue to develop new products and to monitor the rate structure of its deposit products to encourage growth in deposit liabilities. Noninterest-bearing deposits decreased $5,041, or 7.3%, while interest-bearing Adj. 1. interest-bearing - of financial obligations on which interest is paid deposits increased $50,155, or 11.5%. Total borrowings decreased to $96,683 from $100,570 during the three months ended June 30, 2006. Provision and Allowance for Loan Losses The provision for loan losses totaled $420 for the three months ended June 30, 2006, compared to $520 for the same period in 2005. Non-accrual loans for the three months ended June 30, 2006 were $1.393 million compared to $1.962 million for the same period in 2005. Net charge-offs for the three months ended June 30, 2006 decreased to $245, compared to $265 for the three months ended June 30, 2005. 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. net charge-offs for the three months ended June 30, 2006 were 0.17% compared to 0.21% at June 30, 2005. 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. loans over thirty days from period to period increased to 1.56% at June 30, 2006 from 1.37% at June 30, 2005. Non-performing loans A non-performing loan is a loan that is in default or close to being in default. Many loans become non-performing after being in default for 3 months, but this can depend on the contract terms. to total loans declined to .25% of loans at June 30, 2006, from .38% at June 30, 2005. Management will continue to monitor the credit quality of the lending portfolio and will recognize additional provisions in the future to maintain the allowance for loan losses at an appropriate level. The balance for allowance for loan losses increased to $5,792, or 1.03% of total loans at June 30, 2006, compared to $5,370, or 1.02% of total loans at June 30, 2005.
SELECTED CONSOLIDATED FINANCIAL INFORMATION (unaudited)
July 20, 2006 Press Release
DCB FINANCIAL CORP
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands, except per share data)
July 30, December 31,
2006 2005
------------ ------------
(unaudited)
ASSETS
Cash and due from financial institutions $ 22,435 $ 18,069
Securities available for sale 93,836 96,580
Loans held for sale 1,606 1,640
Loans 563,266 553,045
Less allowance for loan losses (5,792) (5,535)
------------ ------------
Net loans 557,474 547,510
Real estate owned 244 386
Investment in FHLB stock 3,495 3,327
Premises and equipment, net 9,264 8,854
Investment in unconsolidated affiliates 968 614
Bank owned life insurance 9,146 8,898
Accrued interest receivable and other assets 6,013 5,018
------------ ------------
Total assets $ 704,481 $ 690,896
============ ============
LIABILITIES
Deposits
Noninterest-bearing $ 63,936 $ 68,977
Interest-bearing 485,084 434,929
------------ ------------
Total deposits 549,020 503,906
Federal funds purchased and other short-term
borrowings 4,252 25,610
Federal Home Loan Bank advances 92,431 102,925
Accrued interest payable and other
liabilities 716 2,201
------------ ------------
Total liabilities 646,419 634,642
SHAREHOLDERS' EQUITY
Common stock, no par value, 7,500,000 shares
authorized, 4,273,200 issued at June 30, 2006
and December 31, 2005 3,780 3,780
Retained earnings 66,276 63,552
Treasury stock, at cost, 458,786 and 447,112
shares at June 30, 2006 and December 31, 2005 (10,841) (10,506)
Accumulated other comprehensive loss (1,153) (572)
------------ ------------
Total shareholders' equity 58,062 56,254
------------ ------------
Total liabilities and
shareholders' equity $ 704,481 $ 690,896
============ ============
DCB FINANCIAL CORP
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(Dollars in thousands, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ------------------
2006 2005 2006 2005
--------- -------- --------- --------
Interest and dividend income
Loans $ 9,934 $ 7,836 $ 19,360 $15,053
Taxable securities 881 820 1,735 1,528
Tax-exempt securities 238 188 470 372
Federal funds sold and
other 36 2 68 3
--------- -------- --------- --------
Total interest
income 11,089 8,846 21,633 16,956
Interest expense
Deposits 4,241 2,178 7,887 3,997
Borrowings 999 974 2,074 1,822
--------- -------- --------- --------
Total interest
expense 5,240 3,152 9,961 5,819
Net interest income 5,849 5,694 11,672 11,137
Provision for loan losses 420 520 980 990
--------- -------- --------- --------
Net interest income after
provision for
loan losses 5,429 5,174 10,692 10,147
Noninterest income
Service charges on deposit
accounts 670 634 1,298 1,205
Trust department income 192 187 410 352
Net loss on sale of assets (5) (20) (10) (32)
Gains on sale of loans 123 122 175 171
Treasury management fees 162 113 315 215
Data processing servicing
fees 85 76 168 148
Earnings on bank owned life
insurance 120 148 248 244
Other 126 137 254 562
--------- -------- --------- --------
1,473 1,397 2,858 2,865
Noninterest expense
Salaries and other employee
benefits 2,294 2,071 4,511 4,283
Occupancy and equipment 815 842 1,603 1,722
Professional services 157 88 275 270
Advertising 98 121 192 207
Postage, freight and
courier 104 91 201 185
Supplies 42 60 128 125
State franchise taxes 129 107 263 215
Other 574 521 1,043 992
--------- -------- --------- --------
4,213 3,901 8,216 7,999
--------- -------- --------- --------
Income before income taxes 2,689 2,670 5,334 5,013
Federal income tax expense 795 786 1,580 1,494
--------- -------- --------- --------
Net income $ 1,894 $ 1,884 $ 3,754 $ 3,519
========= ======== ========= ========
Basic and diluted earnings
per common share $ 0.50 $ 0.48 $ 0.98 $ 0.89
========= ======== ========= ========
DCB FINANCIAL CORP
Selected Key Ratios and Other Financial Data
(Unaudited)
(Dollars in thousands, except per share data)
Three Months Ended Six Months Ended
------------------- -------------------
6/30/06 6/30/05 6/30/06 6/30/05
--------- --------- --------- ---------
Key Financial Information
-------------------------
Net interest income $ 5,849 $ 5,694 $ 11,672 $ 11,137
Provision for loan and lease
losses $ 420 $ 520 $ 980 $ 990
Non-interest income $ 1,473 $ 1,397 $ 2,858 $ 2,865
Non-interest expense $ 4,213 $ 3,901 $ 8,216 $ 7,999
Net income $ 1,894 $ 1,884 $ 3,754 $ 3,519
Loan balances (average) $567,346 $515,991 $564,937 $505,351
Deposit balances (average) $543,058 $483,427 $536,047 $479,091
Basic earnings per common
share $ 0.50 $ 0.48 $ 0.98 $ 0.89
Diluted earnings per common
share $ 0.50 $ 0.48 $ 0.98 $ 0.89
Weighted Average Shares
Outstanding (000)
Basic 3,815 3,930 3,818 3,932
Diluted 3,822 3,932 3,824 3,935
DCB FINANCIAL CORP
Selected Consolidated Financial Information
(Unaudited)
(Dollars in thousands, except per share data)
Three Months Ended Six Months Ended
------------------ -----------------
6/30/06 6/30/05 6/30/06 6/30/05
--------- -------- -------- --------
Key ratios
----------
Return on average assets 1.07% 1.15% 1.07% 1.10%
Return on average shareholders'
equity 13.2% 13.6% 13.3% 12.8%
Annualized non-interest expense
to average assets 2.38% 2.37% 2.33% 2.47%
Efficiency ratio 57.5% 55.0% 56.6% 57.1%
Net interest margin 3.57% 3.74% 3.59% 3.75%
Equity to assets at period end 8.24% 8.27% 8.24% 8.27%
Allowance for loan losses as a
percentage of period-end loans 1.03% 1.02% 1.03% 1.02%
Total allowance for losses on
loans to non-performing loans 416% 274% 416% 274%
Net charge-offs (annualized) as a
percent of average loans 0.17% 0.21% 0.26% 0.17%
Non-performing loans to total
loans (net) 0.25% 0.38% 0.25% 0.38%
Delinquent loans (30+ days) 1.56% 1.37% 1.56% 1.37%
-0-
Business of DCB Financial Corp DCB Financial Corp (the "Corporation") is a financial holding company formed under the laws of the State of Ohio. The Corporation is the parent of The Delaware County Delaware County is the name of six counties in the United States of America:
adj. Associated with or offering complete service: full-service gasoline pumps; full-service banks. branch offices located in Delaware County, Ohio Delaware County is a fast-growing suburban county located in the state of Ohio, United States, within the Columbus, Ohio metropolitan area. According to the U.S. Census Bureau's 2004 population estimates, Delaware County's population of 142,503 made it the fastest growing county and surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. communities. The Bank provides customary retail and commercial banking services to its customers, including checking and savings accounts Savings Account A deposit account intended for funds that are expected to stay in for the short term. A savings account offers lower returns than the market rates. Notes: , time deposits, IRAs, safe deposit facilities, personal loans, commercial loans, real estate mortgage loans, night depository The place where a deposit is placed and kept, e.g., a bank, savings and loan institution, credit union, or trust company. A place where something is deposited or stored as for safekeeping or convenience, e.g., a safety deposit box. facilities and trust and personalized per·son·al·ize tr.v. per·son·al·ized, per·son·al·iz·ing, per·son·al·iz·es 1. To take (a general remark or characterization) in a personal manner. 2. To attribute human or personal qualities to; personify. wealth management services. The Bank also provides cash management, bond registrar See domain name registrar. and payment services. The Bank offers 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 services to other financial institutions; however such services are not a significant part of its current operations or revenues. Application of Critical Accounting Policies DCB's consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge are prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with accounting principles generally accepted in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and follow general practices within the financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. industry. The application of these principles requires management to make estimates, assumptions, and judgments that affect the amounts reported in the financial statements and accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. notes. These estimates, assumptions, and judgments are based on information available as of the date of the financial statements; as this information changes, the financial statements could reflect different estimates, assumptions, and judgments. The most significant accounting policies followed by the Corporation are presented in Note 1 of the audited consolidated financial statements contained in the Corporation's 2005 Annual Report to Shareholders. These policies, along with the disclosures presented in the other financial statement notes and in this financial review, provide information on how significant assets and liabilities are valued in the financial statements and how those values are determined. 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 statements in this report constitute "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 of 1995, such as statements relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the financial condition and prospects, lending risks, plans for future business development and marketing activities, capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. and financing sources, capital structure, the effects of regulation and competition, and the prospective business of both the Corporation and its wholly-owned subsidiary The Delaware County Bank & Trust Company (the "Bank"). Where used in this report, the word "anticipate," "believe," "estimate," "expect," "intend," and similar words and expressions, as they relate to the Corporation or the Bank or their respective management, identify forward-looking statements. Such forward-looking statements reflect the current views of the Corporation and are based on information currently available to the management of the Corporation and the Bank and upon current expectations, estimates, and projections about the Corporation and its industry, management's belief with respect thereto there·to adv. 1. To that, this, or it. 2. Archaic In addition to that; furthermore. thereto Adverb Formal 1. to that or it 2. , and certain assumptions made by management. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by such forward-looking statements. Potential risks and uncertainties include, but are not limited to: (i) significant increases in competitive pressure in the banking and financial services industries; (ii) changes in the interest rate environment which could reduce anticipated or actual margins; (iii) changes in political conditions or the legislative or regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. environment; (iv) general economic conditions, either nationally or regionally (especially in central Ohio), becoming less favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. than expected resulting in, among other things, a deterioration de·te·ri·o·ra·tion n. The process or condition of becoming worse. in credit quality of assets; (v) changes occurring in business conditions and inflation; (vi) changes in technology; (vii) changes in monetary and tax policies; (viii) changes in the securities markets; and (ix) other risks and uncertainties detailed from time to time in the filings of the Corporation with the Commission. The Corporation does not undertake, and specifically disclaims any obligation, to publicly revise any forward-looking statements to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date of such statements or to reflect the occurrence of anticipated or unanticipated events. |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion