LSB Corporation Fourth Quarter Results 2004.NORTH ANDOVER North Andover (ăn`dōvər), town (1990 pop. 22,792), Essex co., NE Mass., on the Merrimack River, in a dairy and farm area; settled c.1644, set off from Andover and inc. 1855. , Mass. -- LSB (Linux Standard Base) A standard interface (ABI) for Linux from the Linux Foundation (www.linux-foundation.org). Introduced in 2001 by the Free Standards Group, which later became the Linux Foundation, applications based on the LSB standard will run properly under Corporation, (the "Corporation" or the "Company") (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 :LSBX), today announced results for the three and twelve months ended December December: see month. 31, 2004. Press releases and SEC filings can be viewed on the internet at our website www.LawrenceSavings.com/press-main.asp or www.LawrenceSavings.com/stockholder-info.asp, respectively. The Corporation reported net income of $840,000 or $0.19 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 for the fourth quarter of 2004. This amount compares to net income of $2,297,000 or $0.52 diluted earnings per share for the same period of 2003. Net income for the year ended December 31, 2004 totaled $4,680,000 or $1.05 diluted earnings per share compared to $4,136,000 or $0.94 diluted earnings per share for the year ended December 31, 2003. Net income for the three months ended December 31, 2004 decreased by $1,457,000 primarily due to the lawsuit lawsuit: see procedure; tort. judgment collected in the amount of $1,996,000 (after tax $1,251,000) included in the three months ended December 31, 2003. Net income for the three months ended December 31, 2004 decreased $206,000 excluding the lawsuit judgment collected from the fourth quarter of 2003. Net interest income increased by $346,000 or 10.5% to $3,630,000 compared to the same quarter in 2003. Net interest income increased primarily due to higher average investment security balances for the three months ended 2004 compared to 2003 resulting in an increase of $347,000 in interest income plus higher average loan balances resulting in a rise of $234,000 in interest income for the same period. Non-interest income increased by $96,000, not including the lawsuit judgment collected in 2003, and was offset by an increase in non-interest expenses of $422,000. The increase in non-interest income of $96,000 was primarily due to loan fees increasing by $55,000 and deposit account fees increasing by $34,000 in 2004 compared to 2003. The increase in loan fees for the fourth quarter 2004 can be attributed to a decrease in the provision for losses associated with 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 ("MSR MSR Microsoft Research MSR Montserrat (ISO Country code) MSR Mountain Safety Research (outdoor goods manufacturer) MSR Magnetic Stripe Reader MSR Egyptair (ICAO code) ") resulting in a $26,000 positive impact to earnings in 2004 as well as a decrease in the amortization of MSR by $36,000 in the fourth quarter of 2004 compared to 2003. Non-interest expenses were $2,699,000 in the fourth quarter of 2004 compared to $2,277,000 for the same quarter of 2003. The increase in the fourth quarter of 2004 is primarily due to salaries and employee benefits rising to $1,603,000 in 2004 from $1,435,000 in 2003 due to normal salary increases and the addition to headcount for the new Salem New Salem is the name of several towns in the United States:
Net income for the year ended December 31, 2004 increased by $544,000 due primarily to the receipt of $2,528,000 (after tax $1,565,000) on a U.S. Bankruptcy bankruptcy, in law, settlement of the liabilities of a person or organization wholly or partially unable to meet financial obligations. The purposes are to distribute, through a court-appointed receiver, the bankrupt's assets equitably among creditors and, in most Judge's CERTIFICATE, JUDGE'S, English practice. The judge who tries the cause is authorized by several statutes in certain cases to certify, so as to decide when the party or parties shall or shall not be entitled to costs. Order to make an interim distribution in a case in which the Company's wholly owned subsidiary Wholly Owned Subsidiary A subsidiary whose parent company owns 100% of its common stock. Notes: In other words, the parent company owns the company outright and there are no minority owners. , Lawrence Savings Bank savings bank, financial institution that, until recently, performed only the following functions: receiving savings deposits of individuals, investing them, and providing a modest return to its depositors in the form of interest. (the "Bank"), is a secured creditor One who holds some special monetary assurance of payment of a debt owed to him or her, such as a mortgage, collateral, or lien. . The Bank recognized $253,000 of the interim distribution as a recovery to the allowance for loan losses on amounts previously charged off and the remaining $2,275,000 as a lawsuit judgment collected in non-interest income. The Bank recorded a negative provision for loan losses of $300,000 in the quarter ended June 30, 2004. Net interest income for the year ended December 31, 2004 increased by $1,454,000 or 11.8% to $13,811,000 from $12,357,000 in 2003. The net interest margin for 2004, compared to 2003, increased slightly to 2.91% from 2.90%, respectively. The increase in net interest income can be attributed to the purchases of investment securities funded primarily from Federal Home Loan Bank ("FHLB FHLB Federal Home Loan Bank ") advances and deposit growth. Average balances for investment securities increased by $49,885,000 in 2004 from 2003. Other factors contributing to a higher net interest income were lower interest expense on deposits and borrowed funds due to lower interest rates and a shift in the mix of deposits and borrowings to lower interest rate products. Partially offsetting these increased revenues for the year 2004 were an increase in non-interest expenses of $926,000 and an increase in the provision for income taxes of $513,000 that is attributable to the lawsuit judgments collected mentioned above and an increase in overall earnings. Non-interest income decreased by $55,000 to $1,553,000 in 2004 from $1,608,000 in 2003 as a result of a decrease in gains on loan sales of $399,000 due to a lower level of loan sales in 2004. Partially offsetting this decrease were increases in loan fees of $164,000 and deposit account fees increasing by $176,000 in 2004 from 2003. Non-interest expenses increased by $926,000 to $10,664,000 for the year 2004 compared to $9,738,000 in 2003. This increase was mainly attributable to salaries and benefits increasing to $6,507,000 from $5,923,000 for the year ended December 31, 2004 from 2003, respectively. Occupancy and equipment expense increased to $872,000 in 2004 from $752,000 in 2003, due to an increase in rent and depreciation expenses associated with the new branch. Professional fees declined slightly to $623,000 in 2004 from $643,000 in 2003 attributable to a reduction in legal expenses. 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 expenses increased by $151,000 to $878,000 in 2004, from $727,000 in 2003, due to installation of new communication lines for the Bank's Wide Area Network ("WAN"). Marketing expenses increased to $273,000 in 2004 from $95,000 in 2003, due to increased advertising for the new Salem, New Hampshire branch and promotions for new product lines. The Corporation continues to look for quality assets, seeks to maintain a low level of risk assets and seeks to grow the loan portfolio profitably. 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. totaled zero at both December 31, 2004 and December 31, 2003. The coverage of the allowance for loan losses to total loans has decreased to 1.78% at December 31, 2004 from 2.00% at December 31, 2003 as a result of growth in the loan portfolio, without a significant change in credit risk to the Company. Total assets increased to $518,477,000 at December 31, 2004 up from $466,108,000 at December 31, 2003. The increase in assets at December 31, 2004 is mainly attributable to an increase of $30,425,000 in investment securities, $21,307,000 in loan growth and $1,294,000 increase in Federal Home Loan Bank stock. The funding for these asset increases came primarily from increases in deposits and borrowed funds of $26,566,000 and $23,911,000, respectively in 2004. Total deposits at December 31, 2004 were $299,106,000 up from $272,540,000 at December 31, 2003. The change from December 31, 2003 is due primarily to increases in certificates of deposit of $15,465,000, money market investment accounts of $6,729,000 and NOW accounts of $1,953,000. All other deposit categories experienced slight increases. At December 31, 2004, the Company's 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. was $57,838,000 as compared to $55,002,000 at December 31, 2003. The increase during 2004 reflects net income of $4,680,000 and proceeds from the exercise of stock options of $806,000. Offsetting these increases were the declaration of cash dividends to shareholders of $2,236,000 and a decrease in the market values of securities available for sale (net of taxes) of $414,000. The Corporation's leverage ratio decreased to 11.25% at December 31, 2004 from 12.11% at December 31, 2003 as a result of the increase in average assets during the year. The Corporation exceeds all regulatory minimum capital ratio requirements as defined by the Federal Reserve Bank as of and for all periods presented. The Bank exceeds all regulatory minimum capital ratio requirements as defined by the FDIC FDIC See: Federal Deposit Insurance Corporation FDIC See Federal Deposit Insurance Corporation (FDIC). as of and for all periods presented. Lawrence Savings Bank, the Company's wholly-owned subsidiary, is a Massachusetts Massachusetts (măsəch  `sĭts), most populous of the New England states of the NE United States. chartered savings bank organized in 1868 and
headquartered at 30 Massachusetts Avenue Massachusetts Avenue may refer to:
North Andover was first settled in 1646 and was officially incorporated in 1855. , approximately 25 miles north of downtown Boston. Lawrence Savings Bank operates 5 banking offices in Massachusetts in Andover, Lawrence, Methuen, and North Andover and 1 banking office in Salem, New Hampshire Salem is a town in Rockingham County, New Hampshire, United States. The population was 28,112 at the 2000 census. Salem is a marketing and distributing center, with several colleges, recreation attractions and a large shopping mall, the Mall at Rockingham Park. . Go to www.LawrenceSavings.com for all your Internet Banking needs. Please visit it today. Lawrence Savings Bank is an Equal Housing Lender The terms Equal Housing Lender and Equal Opportunity Lender are synonymous and refer to all FDIC insured banks in the United States. Such banks are prohibited from discriminating on the basis of race, color, religion, national origin, sex, handicap, or familial status. and member, FDIC and DIFM DIFM Do It for Me (as opposed to Do It Yourself) DIFM Due-In From Maintenance DIFM Digital Instantaneous Frequency Measurement DIFM Distributed Interactive Fire Mission . This press release may contain certain statements that are "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. " within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, as amended a·mend v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. . Such statements are not historical facts and include expressions of management's expectations at a specific point in time regarding future relationships, structures, opportunities and market conditions. Such expectations may or may not be realized, depending on a number of variable factors, including but not limited to, changes in interest rates or in the relationships between long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. rates, disruptions in credit markets, changes in regional and local economic conditions, changes in local housing markets, changes in the regulatory environment including regulatory compliance costs, changes in technology and changes in the competitive environment in which the Company operates. As a result of such risks and uncertainties, the Company's actual results may differ materially from such forward-looking statements. The Company does not undertake, and specifically disclaims any obligation to publicly release revisions to any such forward-looking statements to reflect the occurrence of anticipated or unanticipated 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 statement.
LSB CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET(a)
(In thousands, except per share data)
December 31, December 31,
2004 2003
Loans $ 232,810 $ 211,503
Allowance for loan losses (4,140) (4,220)
Investments held to maturity 200,264 184,286
Investments available for sale 63,039 48,592
Federal Home Loan Bank stock 7,887 6,593
Federal funds sold 209 889
Other assets 18,408 18,465
Total assets $ 518,477 $ 466,108
Deposits $ 299,106 $ 272,540
Borrowed funds 157,263 133,352
Other liabilities 4,270 5,214
Stockholders' equity 57,838 55,002
Total liabilities and
stockholders' equity $ 518,477 $ 466,108
Book value per share $ 13.33 $ 12.99
Select financial ratios: December 31, December 31,
2004 2003
Capital ratios:
Stockholders' equity to
total assets ratio 11.16% 11.80%
Risk-based ratio
Leverage ratio 11.25% 12.11%
Total capital ratio 19.63% 20.50%
Asset quality ratios:
Allowance for loan losses to loans 1.78% 2.00%
Risk assets to total assets 0.00% 0.00%
Risk assets:
Non-performing loans $ -- $ --
Other real estate owned -- 2
Total risk assets $ -- $ 2
CONDENSED CONSOLIDATED INCOME STATEMENT(a)
(In thousands, except share data)
Three months ended Twelve months ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2004 2003 2004 2003
Interest income $ 5,940 $ 5,381 $ 22,331 $ 21,334
Interest expense 2,310 2,097 8,520 8,977
Net interest income 3,630 3,284 13,811 12,357
Provision (credit) for
loan losses -- -- (300) --
Net interest income
after provision
(credit) for loan
losses 3,630 3,284 14,111 12,357
Non-interest income 383 287 1,553 1,608
Lawsuit judgment
collected -- 1,996 2,280 1,996
Non-interest expense 2,699 2,277 10,664 9,738
Net income before
income taxes 1,314 3,290 7,280 6,223
Income tax expense 474 993 2,600 2,087
Net income $ 840 $ 2,297 $ 4,680 $ 4,136
Basic earnings per
share $ 0.19 $ 0.54 $ 1.09 $ 0.98
Diluted earnings per
share $ 0.19 $ 0.52 $ 1.05 $ 0.94
Average shares
outstanding 4,330,627 4,229,326 4,302,729 4,215,944
Average diluted shares
outstanding 4,508,790 4,431,309 4,466,577 4,391,812
Three months ended Twelve months ended
Dec. 31, Dec. 31, Dec. 31, Dec. 31,
2004 2003 2004 2003
Select financial ratios:
Return on average
assets 0.65% 2.01% 0.96% 0.94%
Return on average
stockholders' equity 5.82% 16.92% 8.33% 7.76%
(a) Unaudited
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