EX-99.1 2 ex_508537.htm EXHIBIT 99.1 ex_508537.htm

 

EXHIBIT 99.1 CITIZENS HOLDING COMPANY REPORTS EARNINGS

 

 

PHILADELPHIA, Miss.—(BUSINESS WIRE)—April 25, 2023--Citizens Holding Company (the “Company”) (NASDAQ:CIZN) announced today results of operations for the three months ended March 31, 2023.

 

(in thousands, except share and per share data)

 

Net income for the three months ended March 31, 2023 was $1,140, or $0.20 per share-basic and diluted, a decrease of $896, or 44.01%, from net income of $2,036, or $0.36 per share-basic and diluted for the same quarter in 2022.

 

First Quarter Highlights

 

 

●

Total revenues, or interest and non-interest income, for the three months ended March 31, 2023 totaled $13,395, an increase of $1,808, or 15.60%, compared to the same quarter in 2022. The increase in total revenue is primarily attributed to an increase of $1,978, or 21.85%, in interest income.
 

●

Allowance for credit losses (“ACL”) to loans was 1.06% as of March 31, 2023 compared to 0.90% as of December 31, 2022 and 0.82% as of March 31, 2022. The increase in ACL to loans was primarily attributed to the implementation of Accounting Standard Update (“ASU”) 2016-13 as of January 1, 2023.
 

●

During the quarter, the Company’s book value per share increased to $7.35 as of March 31, 2023, compared to $6.97 as of December 31, 2022. The increase is primarily due to a decrease in medium term treasury yields causing an increase in the value of the securities portfolio.
 

●

Total non-performing assets decreased $101, or (2.36%), to $4,177 at March 31, 2023, compared to $4,278 at December 31, 2022, and decreased $805, or (16.16%), compared to $4,982 at March 31, 2022.

 

Net Interest Income

 

Net interest income for the three months ended March 31, 2023 was $7,678, a decrease of $1,132, or (12.85%), compared to $8,810 for the three months ended December 31, 2022, and a decrease of $609, or (7.35%), compared to $8,287 for the three months ended March 31, 2022. The net interest margin (“NIM”) was 2.56% for the three months ended March 31, 2023 compared to 2.87% for the three months ended December 31, 2022 and 2.69% for the same period in 2022.

 

The linked-quarter decrease in net interest income is primarily a result of the increase in interest expense related to deposits and other borrowed funds resulting in an increase of interest expense of $1,199, or 55.64%, compared to the prior quarter. Management expects continued pressure on NIM given the current interest rate environment.

 

Credit Quality

 

The Company’s non-performing assets decreased by $101, or (2.36%), to $4,177 at March 31, 2023 compared to $4,278 at December 31, 2022, and decreased $805, or (16.16%), compared to $4,982 at March 31, 2022. The primary cause of the decrease is the decrease in loans 90+ days past due and still accruing.

 

 
 

 

Net recoveries for the quarter were $71. Net (recoveries)/charge-offs to average net loans were (0.01%) at March 31, 2023 compared to (0.03%) at March 31, 2022.

 

As a result of the aforementioned facts, coupled with a decrease of $18,351 in loans outstanding during the quarter, the provision for credit losses for the three months ended March 31, 2023 was $6. The provision was primarily driven by qualitative factor adjustments due to inflationary risk concerns on both the local and national economy and overall economic uncertainty. The allowance for credit losses to loans held for investment (“LHFI”) was 1.06% and 0.82% at March 31, 2023 and 2022 respectively, and 0.90% at December 31, 2022, representing a level management considers commensurate with the present risk in the loan portfolio.

 

Non-interest Income

 

Non-interest income decreased for the three months ended March 31, 2023, by $348, or (12.84%), compared to the three months ended December 31, 2022 and decreased by $170, or (6.71%), compared to the same period in 2022.

 

The decrease in non-interest income was primarily due to the decrease in secondary market mortgage loan origination income directly attributable to the rise in mortgage rates throughout 2022.

 

Non-interest Expense

 

Non-interest expense increased for the three months ended March 31, 2023, by $242, or 2.85%, compared to the three months ended December 31, 2022 and increased by $440, or 5.30%, compared to the same period in 2022.

 

The increase in non-interest expense is mainly attributable to an increase in salaries and employee benefits due to an overall tight labor market.

 

Capital

 

Book value per share increased to $7.35, or 5.45%, per share at March 31, 2023 from $6.97 at December 31, 2022 but decreased from $11.27 per share, or (34.78%), at March 31, 2022.

 

The linked quarter-over-quarter increase primarily reflects the decrease in medium term treasury yields during the quarter. The decrease in book value per share from March 31, 2022 to 2023 was driven by the historical increase in medium term treasury yields throughout 2022. The Company’s accumulated other comprehensive loss increased to ($79,822) at March 31, 2023 compared to ($55,477) at March 31, 2022, driven by unrealized losses in our securities portfolio. The unrealized losses decreased the Company’s book value by ($24,345), or $4.35 per share, during 2022, but was partially offset by an increase in earnings in excess of dividends paid.

 

Dividends

 

The Company paid aggregate cash dividends in the amount of $1,346, or $0.24 per share, during the three-month period ended March 31, 2023 compared to $1,343, or $0.24 per share, for the same period in 2022.

 

 
 

 

Citizens Holding Company is a one-bank holding company and the parent company of The Citizens Bank of Philadelphia, both headquartered in Philadelphia, Mississippi. The Bank currently has twenty-seven banking locations in fourteen counties throughout the state of Mississippi. In addition to full service commercial banking, the Company offers mortgage loans, title insurance services through third party partnerships and a full range of Internet banking services including online banking, bill pay and cash management services for businesses. Internet services are available at the Bank web site, www.thecitizensbankphila.com. Citizens Holding Company stock is listed on the NASDAQ Global Market and is traded under the symbol CIZN. The Company's transfer agent is American Stock Transfer & Trust Company. Investor relations information may be obtained at the corporate website, https://www.thecitizensbankphila.com/investor-relations.

 

This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical facts included in this release regarding the Company’s financial position, results of operations, business strategies, plans, objectives and expectations for future operations, are forward looking statements. The Company can give no assurances that the assumptions upon which such forward-looking statements are based will prove to have been correct. Forward-looking statements speak only as of the date they are made. The Company does not undertake a duty to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made. Such forward-looking statements are subject to certain risks, uncertainties and assumptions. The risks and uncertainties that may affect the operation, performance, development and results of the Company’s and the Bank’s business include, but are not limited to, the following: (a) the risk of adverse changes in business conditions in the banking industry generally and in the specific markets in which the Company operates; (b) the impact of COVID-19 on our business, including the impact of the actions taken by governmental authorities to try and contain the virus or address the impact of the virus on the United States economy (including, without limitation, the CARES Act), and the resulting effect of all of such items on our operations, liquidity and capital position, and on the financial condition of our borrowers and other customers; our ability to mitigate our risk exposures; (c) changes in the legislative and regulatory environment that negatively impact the Company and Bank through increased operating expenses; (d) increased competition from other financial institutions; (e) the impact of technological advances; (f) expectations about the movement of interest rates, including actions that may be taken by the Federal Reserve Board in response to changing economic conditions; (g) changes in asset quality and loan demand; (h) expectations about overall economic strength and the performance of the economics in the Company’s market area; and (i) other risks detailed from time to time in the Company’s filings with the Securities and Exchange Commission. Should one or more of these risks materialize or should any such underlying assumptions prove to be significantly different, actual results may vary significantly from those anticipated, estimated, projected or expected.

 

 
 

 

Citizens Holding Company

Financial Highlights

(amounts in thousands, except share and per share data)

 

 

   

For the Three Months Ended

  
   

March 31,

    

December 31,

    

March 31,

  
   

2023

    

2022

    

2022

  

INTEREST INCOME

                        

Loans, including fees

   $ 7,323     $ 7,307     $ 6,397  

Investment securities

     3,370       3,400       2,644  

Other interest

     339       258       13  
      11,032       10,965       9,054  
                         

INTEREST EXPENSE

                        

Deposits

     1,820       958       556  

Other borrowed funds

     1,534       1,197       211  
      3,354       2,155       767  
                         

NET INTEREST INCOME

     7,678       8,810       8,287  
                         

PROVISION FOR CREDIT LOSSES

     6       28       93  
                         

NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES

     7,672       8,782       8,194  
                         

NON-INTEREST INCOME

                        

Service charges on deposit accounts

     914       965       945  

Other service charges and fees

     1,037       1,038       1,025  

Other noninterest income

     412       708       563  
      2,363       2,711       2,533  
                         

NON-INTEREST EXPENSE

                        

Salaries and employee benefits

     4,695       4,292       4,439  

Occupancy expense

     1,845       1,957       1,775  

Other noninterest expense

     2,201       2,250       2,087  
      8,741       8,499       8,301  
                         

NET INCOME BEFORE TAXES

     1,294       2,994       2,426  
                         

INCOME TAX EXPENSE

     154       531       390  
                         

NET INCOME

   $ 1,140     $ 2,463     $ 2,036  
                         

Earnings per share - basic

   $ 0.20     $ 0.44     $ 0.36  
                         

Earnings per share - diluted

   $ 0.20     $ 0.44     $ 0.36  
                         

Dividends paid

   $ 0.24     $ 0.24     $ 0.24  
                         

Average shares outstanding - basic

     5,595,320       5,595,320       5,587,070  
                         

Average shares outstanding - diluted

     5,595,320       5,595,320       5,587,070  

 

 
 

 

   

For the Period Ended,

  
   

March 31,

    

December 31,

    

March 31,

  
   

2023

    

2022

    

2022

  

Period End Balance Sheet Data:

                        

Total assets

   $ 1,289,469     $ 1,324,002     $ 1,348,692  

Total earning assets

     1,174,575       1,192,279       1,245,299  

Loans, net of unearned income

     567,240       585,591       583,194  

Allowance for credit losses

     6,017       5,264       4,776  

Securities held-to-maturity, at amortized cost

     402,237       406,590       -  

Securities available for sale, at fair value

     201,740       201,322       600,766  

Total deposits

     1,115,826       1,126,402       1,149,580  

Securities sold under agreement to repurchase

     98,532       127,574       105,795  

Short-term borrowings

     -       -       -  

Long-term debt

     18,000       18,000       18,000  

Shareholders' equity

     41,124       39,024       62,950  

Book value per share

     7.35       6.97       11.27  
                         

Period End Average Balance Sheet Data:

                        

Total assets

     1,336,480       1,343,234       1,352,709  

Total earning assets

     1,218,404       1,231,084       1,255,510  

Loans, net of unearned income

     582,169       587,034       578,974  

Securities held-to-maturity, at amortized cost

     404,719       137,276       -  

Securities available for sale, at fair value

     201,328       486,223       642,213  

Total deposits

     1,114,446       1,127,937       1,127,727  

Securities sold under agreement to repurchase

     142,853       113,893       90,510  

Short-term borrowings

     8,014       7,890       8,711  

Long-term debt

     18,000       18,000       18,000  

Shareholders' equity

     39,693       62,890       95,462  
                         

Period End Non-performing Assets:

                        

Non-accrual loans

     2,993       2,988       3,545  

Loans 90+ days past due and accruing

     5       111       16  

Other real estate owned

     1,179       1,179       1,421  

 

   

As of

  
   

March 31,

    

December 31,

    

March 31,

  
   

2023

    

2022

    

2022

  
                         

Year to Date Credit Performance Ratios:

                        

Non-performing assets to loans

     0.74 %     0.73 %     0.85 %

Allowance for credit losses to loans

     1.06 %     0.90 %     0.82 %

Allowance for credit losses to non-performing loans

     200.70 %     169.86 %     134.12 %

Net (recoveries)/charge-offs to average net loans

     -0.01 %     -0.11 %     -0.03 %
                         

Year to Date Performance Ratios:

                        

Return on average assets(1)

     0.34 %     0.72 %     0.60 %

Return on average equity(1)

     11.49 %     15.30 %     8.53 %
                         

Year to Date Net Interest

                        

Margin (tax equivalent)(1)

     2.56 %     2.80 %     2.69 %

 

(1) Annualized

 

 

 

Contact:

 

Citizens Holding Company, Philadelphia

Phillip R. Branch, 601/656-4692

Phillip.branch@thecitizensbank.bank