EX-99.1 2 secondquarter09pressrelease.htm PRESS RELEASE SECOND QUARTER 2009 secondquarter09pressrelease.htm
Exhibit 99.1
 

 
 Contact:  Kathleen Campbell, Marketing Director   
  First Citizens National Bank
 570-662-0422   
  
  15 S. Main Street
 570-662-8512 (fax)   
 Mansfield, PA 16933
 
                                                                                                                                   
                                                                                                                                                                                            
Citizens Financial Services, Inc. Reports Second Quarter 2009 Earnings

MANSFIELD, PENNSYLVANIA— July 27, 2009 – Citizens Financial Services, Incorporated (OTC BB: CZFS), parent company of First Citizens National Bank, has released its unaudited financial performance for the 2nd quarter of 2009.

Year-to-date net income through June 30, 2009 was $4,818,000 compared with $4,467,000 last year, representing an increase of $351,000 or 7.9%.  Net interest income after provision for loan losses has increased 9.1% from $11,118,000 for the first half of 2008 to $12,129,000 this year.  Earnings per share of $1.69 increased 7.6% from $1.57 per share for the same period last year.  Return on equity for the comparable periods were 17.79% and 17.80%, while return on assets was 1.42% and 1.50%, respectively.

For the three months ended June 30, 2009, net income totaled $2,472,000, versus $2,446,000 for the comparable period last year, representing an increase of $26,000, or 1.1%.  Earnings per share for the three months ended June 30, 2009 and 2008 were $0.87 and $0.86 per share, respectively, which is an increase of 1.2%.  Return on equity for the comparable periods was 17.99% and 19.24%, while return on assets was 1.43% and 1.64%, for the respective time periods.  Net interest income after provision for loan losses increased 5.0% from $5,830,000 for the second quarter of 2008 to $6,120,000 for the second quarter of 2009.

CEO and President Randall E. Black stated, “Our outstanding financial performance in 2009 was achieved despite an increase of approximately $1.0 million, or 12.9%, in operating expenses, most of which (over $700,000) relates to higher FDIC deposit insurance premiums.  The higher premiums (which include a special assessment) were necessary to replenish the FDIC insurance fund, which has declined due to the increase in bank failures and higher risk activities of financial institutions in general.  Here at First Citizens, we will continue to look for ways to control our non-interest expenses in other areas and will always remain committed to sound and conservative banking principles.”

Total assets at June 30, 2009 totaled a record $706.7 million, which was an increase of $38.1 million from December 31, 2008 and an increase of $104.7 million, or 17.4%, from June 30, 2008.  Since June 30, 2008, the investment portfolio has increased $56.8 million and net loans have increased $13.4 million.  Total deposits of $582.5 million have increased $35.8 million from December 31, 2008, and $97.4 million from one year ago.  As of June 30, 2009 credit quality remains strong as total non-performing assets as a percent of loans are 0.87%, compared to 0.73% at December 31, 2008 and 0.78% as of the end of last June.

Stockholders’ equity totaled $56.6 million at June 30, 2009, representing an increase of $6.0 million, or 11.86%, from June 30, 2008.  Book value per share at June 30, 2009 was $19.70 compared with $18.38 last June, an increase of 7.2%.  In July, a cash dividend of $.245 per share was declared and will be paid on July 31, 2009 to shareholders of record, as of July 17, 2009, an increase of 4.3% over the July 2008 dividend.  Additionally, a 1% stock dividend was declared and will also be distributed on July 31, 2009.  “First Citizens remains well capitalized with capital levels well exceeding regulatory levels,” stated Mr. Black.

Citizens Financial Services, Inc., has over 1,500 shareholders, the majority of whom reside in Potter, Tioga, and Bradford Counties, Pennsylvania and Allegany County, New York, where their 17 offices are located.

Note: This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. These factors include operating, legal and regulatory risks; changing economic and competitive conditions and other risks and uncertainties.

 
 
 


CITIZENS FINANCIAL SERVICES, INC.
      
CONSOLIDATED BALANCE SHEET
      
(UNAUDITED)
      
       
 
June 30
December 31
June 30
(in thousands except share data)
2009
2008
2008
ASSETS:
      
Cash and due from banks:
      
  Noninterest-bearing
 $              9,955
 $           9,692
 $         12,931
  Interest-bearing
               31,768
            10,164
                      1
Total cash and cash equivalents
               41,723
            19,856
            12,932
       
Available-for-sale securities
            181,500
          174,139
          124,674
       
Loans (net of allowance for loan losses: June 30, 2009, $4,622;
      
  December 31, 2008, $4,378; June 30, 2008, $4,287)
            437,450
          428,436
          424,144
       
Premises and equipment
               11,847
            12,762
            12,289
Accrued interest receivable
                 2,786
              2,912
              2,563
Goodwill
               10,256
            10,256
              8,605
Bank owned life insurance
               12,411
            12,176
              8,549
Other assets
                 8,739
              8,075
              8,258
       
TOTAL ASSETS
 $         706,712
 $       668,612
 $       602,014
       
LIABILITIES:
      
Deposits:
      
  Noninterest-bearing
 $           57,669
 $         55,545
 $         56,968
  Interest-bearing
            524,801
          491,135
          428,161
Total deposits
            582,470
          546,680
          485,129
Borrowed funds
               59,382
            61,204
            60,067
Accrued interest payable
                 2,048
              2,233
              1,951
Other liabilities
                 6,203
              5,725
              4,296
TOTAL LIABILITIES
            650,103
          615,842
          551,443
STOCKHOLDERS' EQUITY:
      
Common stock
      
  $1.00 par value; authorized 10,000,000 shares; issued 3,048,289 shares at June 30, 2009
    
      and December 31, 2008; 3,020,538 shares at June 30, 2008
                 3,048
              3,048
              3,020
Additional paid-in capital
               12,888
            12,981
            12,357
Retained earnings
               44,471
            41,034
            40,743
Accumulated other comprehensive income
                    548
                    26
             (1,319)
Treasury stock, at cost:  202,287 shares at June 30, 2009; 200,918 shares at
      
  December 31, 2008 and 196,927 shares at June 30, 2008
               (4,346)
             (4,319)
             (4,230)
TOTAL STOCKHOLDERS' EQUITY
               56,609
            52,770
            50,571
TOTAL LIABILITIES AND
      
   STOCKHOLDERS' EQUITY
 $         706,712
 $       668,612
 $       602,014

 
 
 
 

 
CITIZENS FINANCIAL SERVICES, INC.
        
CONSOLIDATED STATEMENT OF INCOME
        
(UNAUDITED)
        
 
Three Months Ended
Six Months Ended
 
June 30,
  
June 30,
  
(in thousands, except per share data)
2009
2008
2009
2008
INTEREST INCOME:
        
Interest and fees on loans
 $        7,558
 $      7,645
 $      15,035
 $    15,309
Interest-bearing deposits with banks
                 10
                 6
                 12
                 6
Investment securities:
        
    Taxable
           1,541
         1,126
           3,181
         2,249
    Nontaxable
               514
             353
               985
             689
    Dividends
                   6
               56
                 13
             141
TOTAL INTEREST INCOME
           9,629
         9,186
         19,226
       18,394
INTEREST EXPENSE:
        
Deposits
           2,863
         2,728
           5,778
         5,671
Borrowed funds
               496
             628
           1,019
         1,485
TOTAL INTEREST EXPENSE
           3,359
         3,356
           6,797
         7,156
NET INTEREST INCOME
           6,270
         5,830
         12,429
       11,238
Provision for loan losses
               150
                 -
               300
             120
NET INTEREST INCOME AFTER
        
    PROVISION FOR LOAN LOSSES
           6,120
         5,830
         12,129
       11,118
NON-INTEREST INCOME:
        
Service charges
               894
             871
           1,706
         1,647
Trust
               113
             136
               276
             303
Brokerage and insurance
                 53
               74
               153
             118
Gains on loans sold
               162
               20
               209
               42
Investment securities gains, net
               102
                 -
               118
                 -
Earnings on bank owned life insurance
               115
               86
               236
             171
Other
                 96
             131
               191
             246
TOTAL NON-INTEREST INCOME
           1,535
         1,318
           2,889
         2,527
NON-INTEREST EXPENSES:
        
Salaries and employee benefits
           2,329
         2,158
           4,625
         4,314
Occupancy
               296
             281
               617
             595
Furniture and equipment
               124
             128
               234
             261
Professional fees
               164
             148
               295
             329
Other
           1,578
         1,223
           3,092
         2,354
TOTAL NON-INTEREST EXPENSES
           4,491
         3,938
           8,863
         7,853
Income before provision for income taxes
           3,164
         3,210
           6,155
         5,792
Provision for income taxes
               692
             764
           1,337
         1,325
NET INCOME
 $        2,472
 $      2,446
 $        4,818
 $      4,467
         
Earnings Per Share
 $          0.87
 $        0.86
 $          1.69
 $        1.57
Cash Dividends Paid Per Share
 $        0.245
 $      0.235
 $        0.485
 $      0.465
         
Weighted average number of shares outstanding
   2,846,137
  2,852,867
   2,845,328
  2,853,074

 
 
 

 
Financial Highlights
        
         
 
Three Months Ended
  
Six Months Ended
  
 
June 30
  
June 30
  
 
2009
2008
2009
2008
Performance Ratios and Share Data:
        
    Return on average assets (annualized)
1.43%
1.64%
1.42%
1.50%
    Return on average equity (annualized)
17.99%
19.24%
17.79%
17.80%
    Net interest margin (tax equivalent)
4.18%
4.52%
4.24%
4.38%
    Cash dividends paid per share
 $                           0.245
 $                         0.235
 $                        0.485
 $                         0.465
    Earnings per share
 $                             0.87
 $                           0.86
 $                          1.69
 $                           1.57
    Weighted average shares outstanding
                       2,846,137
                     2,852,867
                    2,845,328
                     2,853,074
 

Balance Sheet Highlights (dollars in thousands):
June 30, 2009
December 31, 2008
June 30, 2008
       
Assets
 $                       706,712
 $                     668,612
 $                    602,014
Investment securities:
      
    Available for sale
181,500
174,139
124,674
Loans (net of unearned income)
442,072
432,814
428,431
Allowance for loan losses
4,622
4,378
4,287
Deposits
582,470
546,680
485,129
Stockholders' Equity
56,609
52,770
50,571
Non-performing assets
3,829
                            3,176
                           3,360
Non-performing assets to total loans
0.87%
0.73%
0.78%
Average Leverage Ratio
7.92%
7.91%
8.50%
Common shares outstanding
2,846,002
2,847,371
2,823,611
Book value per share
 $                           19.70
 $                         18.52
 $                        18.38