EX-99.1 2 a05-7385_1ex99d1.htm EX-99.1

 

Exhibit 99.1

 

PRESS RELEASE

 

 

Contacts:

Patrick L. Alexander

President and Chief Executive Officer

Mark A. Herpich

Chief Financial Officer

(785) 565-2000

 

 

FOR IMMEDIATE RELEASE

April 27, 2005

 

 

Landmark Bancorp, Inc. Announces Results for the Quarter Ended March 31, 2005 and Approves a Cash Dividend

 

(Manhattan, KS, April 27, 2005) Landmark Bancorp, Inc. (Nasdaq: LARK), a bank holding company based in Manhattan, Kansas, reported diluted earnings per share for the quarter ended March 31, 2005 of $0.38 versus $0.43 for the quarter ended March 31, 2004, according to Patrick L. Alexander, President and Chief Executive Officer.  Net earnings for the quarter ended March 31, 2005 were $803,000, a decrease of $145,000 compared to the quarter ended March 31, 2004. Additionally, the Board of Directors declared a cash dividend of 17 cents per share to shareholders of record as of May 11, 2005, payable May 23, 2005.

 

Patrick Alexander, President and CEO, commented, “We completed the assimilation of the First Kansas organization on April 1, 2004 and are currently working on capitalizing on the opportunities present in the Miami county and southern Johnson county markets.  The acquisition has resulted in increased non-interest expenses compared to the prior year. While we have also experienced an increase in net interest income and non-interest income as a result of the acquisition, our revenue has not yet increased to a level which we feel reflects the potential that these markets will contribute to our organization.  Our efforts are focused on transitioning the acquired assets and business operations in these new markets in order to further enhance both our net interest income and fee income.  We expect to make significant progress on these goals in 2005.”

 

Alexander further commented, “Decreased gains on sale of loans and investments in 2005 contributed to a decrease in net earnings from the first quarter of 2004.  Increasing interest rates contributed to decreasing mortgage loan originations throughout the industry as residential mortgage loan originations have returned to more normal levels.  Additionally, a disproportionate number of our adjustable rate mortgages are scheduled to reprice in the last three quarters of 2005 than in the first quarter.  This

 

 


 

situation will correct itself over time. This slower pace of repricing in comparison to commercial loans further validates our efforts to reduce our balance sheet concentrations in residential mortgage loans.  However, we remain excited about our prospects and opportunities for the remainder of 2005.  We anticipate that continued economic recovery and expansion will cause commercial loan demand to strengthen.  This would have a positive impact on our net interest income and net interest margin.  Additionally, we believe that our efforts in the newly acquired markets will begin to be a more significant contributor to our financial performance in 2005.”

 

Net interest income for the first quarter of 2005 increased $346,000 to $3.1 million compared to the first quarter of 2004, an increase of 12.5%.  This increase was due primarily to the higher level of earning assets obtained in the acquisition of First Kansas, in spite of a reduction in the net interest margin to 3.08% for the first quarter of 2005 from 3.53% for the first quarter of 2004.  Refinancings and paydowns in the residential mortgage portfolio have exceeded commercial loan growth over the past year, resulting in excess liquidity being invested into lower yielding investment securities.  Total non-interest income increased approximately $114,000, or 12.0%, for the quarter ended March 31, 2005, as compared to the quarter ended March 31, 2004.  The increase was due to increased fees and service charges of $265,000, offset by a decrease of $69,000 in gains on sale of loans and a $98,000 decline in gains on sale of investments.  Total non-interest expense for the first quarter of 2005 increased approximately $641,000 compared to the first quarter of 2004, resulting primarily from increases associated with the acquisition of First Kansas in compensation and benefits, occupancy and equipment, and data processing.

 

Landmark Bancorp’s total assets increased to $444.0 million at March 31, 2005, compared to $442.1 million at December 31, 2004.  Net loans receivable were $276.2 million at March 31, 2005, compared to $278.3 million at December 31, 2004.  At March 31, 2005, the allowance for loan losses was $3.0 million, or 1.1% of gross loans outstanding, compared to $2.9 million, or 1.0% of gross loans outstanding at December 31, 2004.  As of March 31, 2005, $2.4 million in loans were on non-accrual status, or 0.9% total loans, compared to a balance of $1.1 million in loans on non-accrual status, or 0.4% of total loans, as of December 31, 2004.  Additionally, non-performing assets as a percentage of total assets increased from 0.4% as of December 31, 2004 to 0.7% as of March 31, 2005.  The increase in non-accrual loans is related to a single borrowing relationship comprised of a pool of residential home loans totaling $1.4 million.  Residential home loans comprised 80.3% of the $2.4 million non-accrual balance at March 31, 2005.  In the event of foreclosure, the Company has historically incurred minimal losses on these residential home loans based upon collateral values.

 

Landmark Bancorp consummated the acquisition of First Kansas Financial Corporation on April 1, 2004 and accordingly, the operating results presented for the quarter ended March 31, 2005 include the accounts of First Kansas Financial Corporation

 

 


 

while the corresponding quarter ended March 31, 2004 do not.  Landmark Bancorp, Inc. is the holding company for Landmark National Bank.  Landmark National Bank has branches in Manhattan (2), Auburn, Dodge City (2), Fort Scott, Garden City, Great Bend, Hoisington, LaCrosse, Louisburg, Osage City, Osawatomie, Paola, Topeka and Wamego, Kansas.

 

 

Special Note Concerning Forward-Looking Statements

 

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company.  Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions.  Additionally, all statements in this press release, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.

 

A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements.  These factors include, among others, the following: (i) the strength of the local and national economy; (ii) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business; (iii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (iv) changes in interest rates and prepayment rates of the Company’s assets; (v) increased competition in the financial services sector and the inability to attract new customers; (vi)  the economic impact of armed conflict or terrorist acts involving the United States; (vii) the loss of key executives or employees; (viii) changes in consumer spending; (ix) unexpected results of acquisitions including last year’s acquisition of First Kansas; (x) unexpected outcomes of existing or new litigation involving the Company; and (xi) changes in accounting policies and practices.  These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.  Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.

 


CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited):

 

 

At March 31,
2005

 

At December 31,
2004

 

ASSETS

 

 

 

 

 

Cash and cash equivalents

 

$

13,761,529

 

$

7,845,438

 

Investment securities available for sale

 

131,520,943

 

133,604,335

 

Loans receivable, net(1)

 

276,177,199

 

278,259,966

 

Premises and equipment, net

 

5,758,115

 

5,864,258

 

Goodwill

 

7,651,892

 

7,651,892

 

Other intangible assets, net

 

1,263,968

 

1,339,832

 

Other assets

 

7,886,823

 

7,525,173

 

TOTAL ASSETS

 

$

444,020,469

 

$

442,090,894

 

LIABILITIES

 

 

 

 

 

Deposits

 

$

307,203,307

 

$

302,867,721

 

Other borrowings

 

90,895,791

 

94,571,321

 

Other liabilities

 

3,744,707

 

2,482,875

 

Total liabilities

 

401,843,805

 

399,921,917

 

Stockholders’ equity

 

42,176,664

 

42,168,977

 

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

 

$

444,020,469

 

$

442,090,894

 

(1)  Loans receivable are presented after adjustments for undisbursed loan funds, unearned fees and discounts and the allowance for loan losses.  The allowance for loan losses was $3,015,091 and $2,893,603 at March 31, 2005 and December 31, 2004, respectively.

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (unaudited):

 

 

Three months ended March 31,

 

 

 

2005

 

2004

 

Interest income:

 

 

 

 

 

Loans

 

$

4,101,714

 

$

3,227,509

 

Investment securities

 

1,036,801

 

811,325

 

Other

 

13,070

 

8,332

 

Total interest income

 

5,151,585

 

4,047,166

 

Interest expense:

 

 

 

 

 

Deposits

 

1,160,065

 

932,801

 

Borrowed funds

 

880,726

 

349,444

 

Total interest expense

 

2,040,791

 

1,282,245

 

Net interest income

 

3,110,794

 

2,764,921

 

Provision for loan losses

 

120,000

 

60,000

 

Net interest income after provision for loan losses

 

2,990,794

 

2,704,921

 

Non-interest income:

 

 

 

 

 

Fees and service charges

 

797,659

 

532,735

 

Gains on sale of loans

 

165,576

 

234,885

 

Gains on sale of investments

 

—

 

97,687

 

Other

 

97,180

 

81,501

 

Total non-interest income

 

1,060,415

 

946,808

 

Non-interest expense:

 

 

 

 

 

Compensation and benefits

 

1,457,718

 

1,217,804

 

Occupancy and equipment

 

425,402

 

319,046

 

Amortization

 

96,030

 

75,147

 

Professional fees

 

86,143

 

78,694

 

Data processing

 

128,996

 

78,865

 

Other

 

703,953

 

487,765

 

Total non-interest expense

 

2,898,242

 

2,257,321

 

Earnings before income taxes

 

1,152,967

 

1,394,408

 

Income tax expense

 

349,591

 

445,647

 

Net earnings

 

$

803,376

 

$

948,761

 

Net earnings per share(2)

 

 

 

 

 

Basic

 

$

0.38

 

$

0.43

 

Diluted

 

0.38

 

0.43

 

Book value per share(2)

 

$

19.98

 

$

19.64

 

Shares outstanding at end of period

 

2,110,588

 

2,195,872

 

Weighted average common shares outstanding - basic

 

2,110,588

 

2,195,210

 

Weighted average common shares outstanding - diluted

 

2,123,109

 

2,214,262

 

(2)  Net earnings per share and book value per share at or for the period ended March 31, 2004 have been adjusted to give effect to the 5% stock dividend paid during December 2004.

 

 

Three months ended March 31,

 

OTHER DATA (unaudited):

 

2005

 

2004

 

Return on average assets(3)

 

0.74

%

1.15

%

Return on average equity(3)

 

7.70

%

8.88

%

Equity to total assets

 

9.50

%

13.05

%

Net yield on interest earnings assets(3)

 

3.08

%

3.53

%

(3)  Information for the three months ended is annualized.