8-K 1 tcbk200309pr.txt TCBK - 10/23/2003 FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): October 23, 2003 TriCo Bancshares (Exact name of registrant as specified in its charter) California 0-10661 94-2792841 ------------------------ --------------- -------------------- (State or other (Commission File No.) (I.R.S. Employer jurisdiction of Identification No.) incorporation or organization) 63 Constitution Drive, Chico, California 95973 -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (530) 898-0300 Item 7(c): Exhibits ------------------- 99.1 Press release dated October 23, 2003 Item 12: Results of Operations and Financial Condition ------------------------------------------------------- On October 23, 2003 TriCo Bancshares announced their quarterly earnings for the third quarter of 2003. A copy of the press release is attached as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. TRICO BANCSHARES Date: October 23, 2003 By: /s/ Thomas J. Reddish -------------------------------------- Thomas J. Reddish, Vice President and Chief Financial Officer (Principal Financial and Accounting Officer) INDEX TO EXHIBITS Exhibit No. Description ----------- -------------------------------------------- 99.1 Press release dated October 23, 2003 PRESS RELEASE Contact: Thomas J. Reddish Vice President & CFO For Immediate Release (530) 898-0300 TRICO BANCSHARES ANNOUNCES 3rd QUARTER EARNINGS FOR 2003 -------------------------------------------------------- Chico, CA - October 23, 2003. TriCo Bancshares (NASDAQ: TCBK), parent company of Tri Counties Bank, today announced quarterly earnings of $4,338,000, or $0.54 per diluted share, for the three months ended September 30, 2003. These results represent an 8.0% increase from the $0.50 earnings per diluted share reported for the three months ended September 30, 2002 on earnings of $3,627,000. Diluted earnings per share for the nine months ended September 30, 2003 and 2002 were $1.57 and $1.44, respectively, on earnings of $12,205,000 and $10,320,000, respectively. Included in the results ended September 30, 2003 was the effect of the Company's acquisition of North State National Bank on April 4, 2003. On April 4, 2003, North State National Bank had assets of $140 million, loans totaling $77 million, and deposits totaling $126 million. The Company issued $13,090,057 in cash, 723,512 shares of TriCo common stock, and options to purchase 79,587 TriCo common shares at an average exercise price of $6.22 per share in exchange for all of the 1,234,375 common shares and options to purchase 79,937 common shares of North State National Bank outstanding as of April 4, 2003. The improvement in results from the year-ago quarter was due to a $2,549,000 (18.9%) increase in fully tax-equivalent net interest income to $16,069,000, and a $550,000 (78.6%) decrease in provision for loan losses to $150,000. These contributing factors were partially offset by a $207,000 (3.8%) decrease in noninterest income to $5,206,000, and a $1,916,000 (15.8%) increase in noninterest expense to $14,049,000 for the quarter ended September 30, 2003. Richard Smith, President and Chief Executive Officer commented that, "The quarter ended September 30, 2003 was a very good quarter for our Company. The hard work of our team members and the acceptance of our line of products and services by our marketplace continue to provide strong asset and customer account growth. This growth allowed us to continue to improve earnings despite the recent slowdown in mortgage banking activities. In addition, during this quarter we dramatically reduced the level of nonperforming assets." During the quarters ended September 30, 2003 and 2002, the Company's net interest margin was 5.24% and 5.67%, respectively, on interest-earning asset balances averaging $1.23 billion and $955 million, respectively. The 28% increase in the average balance of interest earning assets more than offset the decrease in net interest margin resulting in an increase in fully tax equivalent net interest income of $2,549,000 (18.9%) to $16,069,000. Noninterest income for the third quarter of 2003 decreased $207,000 (3.8%) to $5,206,000 from $5,413,000 in the year-ago quarter. The decrease in noninterest income from the year-ago quarter was mainly due to a $673,000 (93%) decrease in mortgage banking noninterest income to $51,000 from $724,000 in the year-ago quarter. Noninterest expense for the third quarter of 2003 increased $1,916,000 (15.8%) to $14,049,000 from $12,133,000 in the third quarter of 2002. The increase in noninterest expense was mainly due to an increase in salary and benefit expense (up $1,116,000 or 17.6% to $7,460,000). The increase in salary and benefits expense was mainly due to annual salary increases, increased commission and incentive expense, and new employees at four new branches the Company opened during 2002 and from the merger with North State National Bank on April 4, 2003. Other noninterest expense, including intangible amortization, increased (up $800,000 or 13.8% to $6,589,000) due to the new branch openings in 2002 and the merger with North State. Nonperforming loans net of government agency guarantees were $6,072,000, $20,539,000, $8,180,000, and $11,031,000 as of September 30, 2003, June 30, 2003, December 31, 2002, and September 30, 2002, respectively. As of September 30, 2003, December 31, 2002, and September 30, 2002, the ratio of allowance for loan losses to total loans was 1.45%, 2.09% and 2.10%, respectively. As of September 30, 2003, December 31, 2002, and September 30, 2002, the ratio of allowance for loan losses to nonperforming assets was 177%, 158% and 130%, respectively. Based on the current conditions of the loan portfolio, Management believes that the $13,460,000 allowance for loan losses at September 30, 2003 is adequate to absorb probable losses inherent in the Company's loan portfolio. The Company provided $150,000 for loan losses in the third quarter of 2003 versus $700,000 in the third quarter of 2002. This decrease in the provision for loan losses was due to improved credit quality as evidenced by the reduction in nonperforming loans, and the adequacy of the loan loss reserve as evidenced by the increase in the ratio of allowance for loan losses to nonperforming assets. During the third quarter of 2003, the Company recorded $145,000 of net loan charge offs versus $68,000 of net loan recoveries in the year earlier quarter. Assets of the Company at September 30, 2003 were $1.44 billion compared to $1.07 billion at September 30, 2002. Loan balances at September 30, 2003 were $930 million compared to $684 million at September 30, 2002, and deposit balances at September 30, 2003 were $1.20 billion compared to $938 million at September 30, 2002. For the third quarter of 2003, the Company had an annualized return on assets of 1.25% and a return on equity of 14.09% versus 1.39% and 15.17%, respectively, in the third quarter of 2002. As of September 30, 2003, TriCo Bancshares had a Tier 1 capital ratio of 10.6% and a total risk-based capital ratio of 11.7%. As previously announced on July 31, 2003, the Company terminated its stock repurchase plan to repurchase 150,000 shares of common stock originally announced on October 19, 2001. There were 118,800 shares repurchased under the plan and the remaining 31,200 shares had not been repurchased. The Company has adopted a new stock repurchase plan for the repurchase of up to 250,000 shares of the Company's common stock from time to time as market conditions allow. The 250,000 shares authorized for repurchase under this plan represented approximately 3.2% of the Company's approximately 7,852,000 common shares outstanding as of July 31, 2003. This new plan has no stated expiration date for the repurchases. The Company repurchased 8,100 common shares under this new plan, all of which were repurchased during the quarter ended September 30, 2003. In addition to the historical information contained herein, this press release contains certain forward-looking statements. The reader of this press release should understand that all such forward-looking statements are subject to various uncertainties and risks that could affect their outcome. The Company's actual results could differ materially from those suggested by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, variances in the actual versus projected growth in assets, return on assets, loan losses, expenses, rates charged on loans and earned on securities investments, rates paid on deposits, competition effects, fee and other noninterest income earned as well as other factors. This entire press release should be read to put such forward-looking statements in context and to gain a more complete understanding of the uncertainties and risks involved in the Company's business. TriCo Bancshares and Tri Counties Bank are headquartered in Chico, California. Tri Counties Bank has a 28 year history in the banking industry. Tri Counties Bank operates 33 traditional branch locations and 10 in-store branch locations in 20 California counties. Tri Counties Bank offers financial services and provides a diversified line of products and services to consumers and businesses, which include demand, savings and time deposits, consumer finance, online banking, mortgage lending, and commercial banking throughout its market area. It operates a network of 54 ATMs and a 24-hour, seven days a week telephone customer service center. Brokerage services are provided at the Bank's offices by the Bank's association with Raymond James Financial, Inc. For further information please visit the Tri Counties Bank web-site at http://www.tricountiesbank.com
TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA (Dollars in thousands, except per share data) Three months ended ----------------------------------------------------------------------------- September 30, June 30, March 31, December 31, Sept. 30, 2003 2003 2003 2002 2002 ----------------------------------------------------------------------------- Statement of Income Data Interest income $ 19,105 $ 18,161 $ 16,349 $ 16,228 $ 16,435 Interest expense 3,305 3,445 3,115 3,245 3,227 Net interest income 15,800 14,716 13,234 12,983 13,208 Provision for loan losses 150 150 150 800 700 Noninterest income: Service charges and fees 3,117 3,985 3,500 3,651 3,521 Other income 2,089 2,569 1,896 2,347 1,892 Total noninterest income 5,206 6,554 5,396 5,998 5,413 Noninterest expense: Salaries and benefits 7,460 7,636 6,877 6,434 6,344 Intangible amortization 325 324 228 228 228 Other expense 6,264 6,408 5,546 5,811 5,561 Total noninterest expense 14,049 14,368 12,651 12,473 12,133 Net income before taxes 6,807 6,752 5,829 5,708 5,788 Net income $ 4,338 $ 4,254 $ 3,613 $ 3,748 $ 3,627 Share Data Basic earnings per share $ 0.55 $ 0.55 $ 0.51 $ 0.53 $ 0.52 Diluted earnings per share 0.54 0.53 0.50 0.52 0.50 Book value per common share $ 15.91 $ 15.86 $ 14.39 $ 14.02 $ 13.70 Shares outstanding 7,846,001 7,852,110 7,080,470 7,060,965 7,035,590 Weighted average shares 7,850,374 7,796,383 7,070,701 7,046,246 7,026,120 Weighted average diluted shares 8,094,964 8,021,229 7,250,178 7,211,705 7,231,165 Credit Quality Non-performing loans, net of government agency guarantees $ 6,072 $ 20,539 $ 20,610 $ 8,180 $ 11,031 Other real estate owned 1,545 1,551 1,608 932 - Loans charged-off 551 2,063 280 870 73 Loans recovered $ 406 $ 147 $ 46 $ 66 $ 141 Allowance for loan losses to total loans 1.45% 1.58% 2.06% 2.09% 2.10% Allowance for loan losses to NPLs 222% 66% 69% 176% 130% Allowance for loan losses to NPAs 177% 61% 64% 158% 130% Selected Financial Ratios Return on average total assets 1.25% 1.27% 1.26% 1.35% 1.39% Return on average equity 14.09% 13.88% 14.29% 15.35% 15.17% Average yield on loans 7.41% 7.34% 7.64% 7.75% 7.89% Average yield on earning assets 6.32% 6.18% 6.36% 6.53% 7.02% Average rate on earning liabilities 1.36% 1.45% 1.52% 1.65% 1.72% Net interest margin 5.24% 5.02% 5.17% 5.25% 5.67% Total risk based capital ratio 11.7% 10.4% 11.6% 12.0% 11.9% Tier 1 Capital ratio 10.6% 9.1% 10.4% 10.7% 10.6%
TRICO BANCSHARES - CONSOLIDATED FINANCIAL DATA (Dollars in thousands, except per share data) Three months ended ------------------------------------------------------------------------- September 30, June 30, March 31, December 31, Sept. 30, 2003 2003 2003 2002 2002 ------------------------------------------------------------------------- Balance Sheet Data Cash and due from banks $ 66,747 $ 65,051 $ 58,925 $ 67,170 $ 56,749 Fed funds sold 1,900 3,200 10,100 8,100 23,400 Securities, available-for-sale 350,761 354,040 354,007 338,024 268,921 Loans Commercial loans 152,477 147,746 117,329 125,982 142,290 Consumer loans 297,186 237,704 210,633 201,858 191,601 Real estate mortgage loans 420,312 407,218 330,001 319,969 313,191 Real estate construction loans 60,066 59,622 35,810 39,713 36,472 Total loans, gross 930,041 852,290 693,773 687,522 683,554 Allowance for loan losses (13,460) (13,455) (14,293) (14,377) (14,382) Premises and equipment 19,787 19,830 17,542 17,224 16,583 Cash value of life insurance 38,644 34,633 29,257 15,208 15,045 Intangible assets 21,992 22,189 3,815 4,043 4,387 Other assets 24,172 23,124 23,377 21,660 19,266 Total assets 1,440,584 1,360,902 1,176,503 1,144,574 1,073,523 Noninterest bearing demand deposits 267,148 260,861 226,373 232,499 202,895 Interest bearing demand deposits 211,219 204,538 188,575 182,816 175,883 Savings deposits 426,340 393,198 324,584 297,926 268,182 Time certificates 291,145 315,008 293,120 291,996 290,935 Total deposits 1,195,852 1,173,605 1,032,652 1,005,237 937,895 Fed funds purchased & repurchase agreements 55,700 17,400 - - - Other liabilities 21,312 22,425 19,044 17,399 16,275 Other borrowings 22,894 22,905 22,915 22,924 22,932 Trust preferred securities 20,000 - - - - Total liabilities 1,315,758 1,236,335 1,074,611 1,045,560 977,102 Total shareholders' equity 124,826 124,567 101,892 99,014 96,421 Accumulated other comprehensive income 1,223 3,433 2,688 2,303 2,333 Average loans 876,068 801,493 679,975 675,626 676,009 Average interest earning assets 1,226,453 1,194,618 1,048,286 1,013,175 954,611 Average total assets 1,384,672 1,339,107 1,149,759 1,112,660 1,044,518 Average deposits 1,185,059 1,146,211 1,003,853 970,666 908,675 Average total equity $ 123,168 $ 122,567 $ 101,139 $ 97,684 $ 95,645