-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JShVVJTRehnrO6cTGaQRnuALUksjHvzQH3nLd9OzGHspx3A76ZKd7NMkaF8UMnOf xtWPPn31pLKAaLcV0Om8Fw== 0000950152-05-000489.txt : 20050126 0000950152-05-000489.hdr.sgml : 20050126 20050126113823 ACCESSION NUMBER: 0000950152-05-000489 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20041231 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050126 DATE AS OF CHANGE: 20050126 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CITIZENS & NORTHERN CORP CENTRAL INDEX KEY: 0000810958 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 232451943 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-16084 FILM NUMBER: 05549036 BUSINESS ADDRESS: STREET 1: 90-92 MAIN ST CITY: WELLSBORO STATE: PA ZIP: 16901 BUSINESS PHONE: 7172656171 MAIL ADDRESS: STREET 1: 90-92 MAIN ST CITY: WELLSBORO STATE: PA ZIP: 16901 8-K 1 l11631ae8vk.txt CITIZENS & NORTHERN CORP 8-K 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) December 31, 2004 ----------------- CITIZENS & NORTHERN CORPORATION ------------------------------- (Exact name of registrant as specified in its charter) Pennsylvania 0-16084 23-2451943 - ------------------------------------ -------------- ------------------- (State or other jurisdiction of (Commission (I.R.S. Employer incorporation) File Number) Identification No.) 90-92 Main Street, Wellsboro, PA 16901 - ---------------------------------------- --------- (Address of Principal Executive Office) (Zip Code) Registrant's telephone number, including area code (570) 724-3411 -------------- N/A --- (Former name or former address, if changed since last report) ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION Citizens & Northern Corporation announced the unaudited, consolidated financial results for Citizens & Northern Corporation and subsidiaries for the annual and three-month periods ended December 31, 2004. On January 26, 2005, Citizens & Northern Corporation issued a press release titled "C&N Announces 2004 Unaudited Financial Results," a copy of which is filed as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. Also on January 26, 2005, Citizens & Northern Corporation completed its "Quarterly Report," a report that includes unaudited financial information. The Quarterly Report will be mailed to shareholders on or about January 31, 2005. A copy of the Quarterly Report is filed as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS (a) Not applicable. (b) Not applicable. (c) Exhibits. Exhibit 99.1: Press Release issued by Citizens & Northern Corporation dated January 26, 2005, titled "C&N Announces 2004 Unaudited Financial Results." Exhibit 99.2: Quarterly Report, which includes unaudited financial information. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned, thereunto duly authorized. CITIZENS & NORTHERN CORPORATION Date: 1/26/05 By: Craig G. Litchfield /s/ ----------------------- Chairman, President and Chief Executive Officer EX-99.1 2 l11631aexv99w1.txt EXHIBIT 99.1 EXHIBIT 99.1 PRESS RELEASE [CITIZENS & NOTHERN BANK LOGO] Contact: Yvonne Gill January 26, 2005 570-724-0212 ygill@cnbankpa.com C&N ANNOUNCES 2004 UNAUDITED FINANCIAL RESULTS FOR IMMEDIATE RELEASE: Wellsboro, PA - Citizens & Northern Corporation recently announced the unaudited, consolidated financial results for the year ended December 31, 2004, and for the fourth quarter 2004, which are highlighted below. FINANCIAL HIGHLIGHTS FOR THE YEAR ENDED DECEMBER 31, 2004: o Net Income for 2004 totaled $14,863,000, a decrease of 8.6% from 2003 Net Income of $16,257,000. Net Income Per Share was $1.82 (Basic) and $1.81 (Diluted) for 2004, as compared to $1.99 (Basic) and $1.98 (Diluted) for 2003. o Return on Average Assets was 1.33% for 2004, as compared to 1.57% for 2003. Return on Average Equity was 11.58% for 2004, as compared to 13.30% for 2003. o Total assets amounted to $1,123,002,000 as of December 31, 2004, an increase of 5.3% over total assets of $1,066,901,000 as of December 31, 2003. Net loans increased $54,026,000, or 10.4%, as of December 31, 2004, compared to one year earlier. o Shareholders' Equity/Average Assets Ratio was 10.72% as of December 31, 2004. This safety and soundness measurement needs to be at a minimum of 5% to be considered well capitalized by banking regulatory agencies. o Cash Dividends declared by C&N increased 4.7% in 2004 over 2003, to $0.89 per share. A number of significant initiatives contributed to higher operating expenses in 2004 as compared to 2003, including (1) non-payroll expenses of $766,000 related to conversion to new core banking software (implemented in October), (2) pre-tax losses of $735,000 from start-up expenses and operations of new branch locations in Williamsport and South Williamsport, and (3) an increase in salaries and wages for operations other than the new branches of $1,363,000 in 2004 over 2003, primarily from the addition of new employees for Lending, Trust and Financial Management, Employee Training and other duties. Overall, noninterest expense increased $3,877,000 (17.6%) in 2004 over 2003. A lower amount of net realized gains from securities also contributed to lower profitability in 2004, as securities gains amounted to $2,877,000 in 2004, a reduction of $1,922,000 from 2003. Helping to offset some of the higher noninterest expenses, net interest income increased $3,630,000 (11.5%) in 2004 as compared to 2003. Also, the provision for income taxes decreased $758,000 (21.0%) in 2004 as compared to 2003. FINANCIAL HIGHLIGHTS FOR THE FOURTH QUARTER 2004: o Net Income for the fourth quarter 2004 was $4,063,000, as compared to $4,347,000 in the fourth quarter 2003. Core banking system expenses totaled $254,000, and pre-tax losses from the new Williamsport and South Williamsport branches totaled $196,000, in the fourth quarter 2004. Net securities gains were $377,000 lower in the fourth quarter 2004 than in the fourth quarter 2003. Net Income Per Share was $0.50 (Basic) and $0.49 (Diluted) for the fourth quarter 2004, as compared to $0.53 (Basic and Diluted) for the fourth quarter 2003. o Net Income for the fourth quarter 2004 was $658,000 (19.3%) higher than third quarter 2004 net income of $3,405,000. Net securities gains increased $674,000 in the fourth quarter 2004 over the third quarter 2004. o Cash Dividends declared increased to $0.23 per share for the fourth quarter 2004 from $0.22 per share for the fourth quarter 2003. Citizens & Northern Bank is a wholly-owned subsidiary of Citizens & Northern Corporation. Citizens & Northern Corporation provides complete financial, investment and insurance services through 19 full service offices of Citizens & Northern Bank located throughout Tioga, Bradford, Sullivan and Lycoming counties. C&N can be found on the worldwide web at www.cnbankpa.com. The Company's stock trades on the NASDAQ SmallCap Market under the symbol CZNC. EX-99.2 3 l11631aexv99w2.txt EXHIBIT 99.2 EXHIBIT 99.2 (CITIZENS & NORTHERN CORPORATION LOGO) 90-92 Main Street, P.O. Box 58 Wellsboro, PA 16901 Phone: (570) 724-3411 Fax: (570) 723-8097 E-Mail: cnemail@cnbankpa.com Web Page: http://www.cnbankpa.com Stock Symbol: CZNC Chartered 1864 FEDERAL DEPOSIT INSURANCE CORP DECEMBER 31, 2004 QUARTERLY REPORT Dear Shareholder: Citizens & Northern Corporation has made great progress over the last few months of 2004 and first few weeks of 2005! Most recently, on January 13, 2005, C&N's stock began to trade on the NASDAQ SmallCap market. This change should provide more liquidity for the stock. In November, C&N, along with Canisteo Valley Corporation (Canisteo), announced the signing of a definitive agreement and plan of merger. Canisteo is the parent company of First State Bank; a New York State chartered bank with two offices in Steuben County, NY, and assets of $42.5 million as of September 30, 2004. We anticipate the all-cash merger transaction to be completed during the 2nd quarter 2005, pending Canisteo stockholder and regulatory approvals. We expect First State Bank to operate as a separate subsidiary of C&N. We are excited about this chance to continue, and enhance, First State Bank's tradition of community banking in the Canisteo area, and look forward to more opportunities in New York State. In October, we converted to a new core computer system. Selection, training and initial implementation took more than a year to complete, and required a tremendous effort from our dedicated staff. I appreciate your patience as you become accustomed to changes in our processes, report formats, etc., and I am confident that our staff will soon become as expert with the new system as they were the old. Net income for 2004 totaled $14.863 million, or $1.81 per share (diluted). Net income was down 8.6% from 2003. In 2004, expenses for the core computer conversion and start-up expenses and operations for the two new Lycoming County offices totaled more than $1.5 million. Salaries and wages from operations other than the new branches increased $1.363 million, primarily from the addition of new positions. Also, securities gains were $1.922 million lower in 2004. Net interest income for 2004 was up $3.630 million (11.5%), primarily from growth in loans. Net loans of $572.826 million as of year-end 2004 were 10.4% higher than year-end 2003. Total assets of $1.123 billion at December 31, 2004 were up 5.3% from one year earlier. Trust assets under management increased 16.2% to $383 million. Nonperforming loans of 0.69% of total assets at December 31, 2004 are substantially higher than our historical norms. We are closely monitoring our loan portfolio, and continue to maintain an adequate allowance for loan losses. Our equity position remains strong at 10.72% average equity to average assets. The 4th quarter dividend was 23 cents per share, bringing total dividends declared for 2004 to 89 cents, an increase of 4.7% over 2003. 2004 was a year of significant investments in people, facilities and technology. We will continue to look for worthwhile opportunities in 2005, always with the goal of stimulating earnings and productivity. Thank you for your continued support. Craig G. Litchfield Chairman, President & CEO CITIZENS & NORTHERN CORPORATION BOARD OF DIRECTORS Craig G. Litchfield Chairman of the Board Dennis F. Beardslee Leo F. Lambert R. Robert DeCamp Edward L. Learn Jan E. Fisher Edward H. Owlett, III R. Bruce Haner Leonard Simpson Susan E. Hartley James E. Towner Karl W. Kroeck Ann M. Tyler DIRECTORS EMERITI J. Robert Bower F. David Pennypacker Lawrence F. Mase Donald E. Treat OFFICERS Craig G. Litchfield Chairman, President and Chief Executive Officer Mark A. Hughes Treasurer Kathleen M. Osgood Corporate Secretary CITIZENS & NORTHERN BANK OFFICES 428 S. Main Street, ATHENS, PA 18810 570-888-2291 111 Main Street, DUSHORE, PA 18614 570-928-8124 Main Street, EAST SMITHFIELD, PA 18817 570-596-3131 104 Main Street, ELKLAND, PA 16920 814-258-5111 102 E. Main Street, KNOXVILLE, PA 16928 814-326-4151 Main Street, LAPORTE, PA 18626 570-946-4011 Main Street, LIBERTY, PA 16930 570-324-2331 1085 S. Main Street, MANSFIELD, PA 16933 570-662-1111 Route 220, MONROETON, PA 18832 570-265-2157 3461 Rte.405 Highway, MUNCY, PA 17756 570-546-6666 Thompson Street, RALSTON, PA 17763 570-995-5421 503 N. Elmira Street, SAYRE, PA 18840 570-888-2220 2 E. Mountain Ave., SO. WILLIAMSPORT, PA 17702 570-601-3016 41 Main Street, TIOGA, PA 16946 570-835-5236 428 Main Street, TOWANDA, PA18848 570-265-6171 Court House Square, TROY, PA 16947 570-297-2159 90-92 Main Street, WELLSBORO, PA 16901 570-724-3411 130 Court Street, WILLIAMSPORT, PA 17701 570-320-0100 Route 6, WYSOX, PA 18854 570-265-9148 TRUST & FINANCIAL MANAGEMENT GROUP 90-92 Main Street, Wellsboro, PA 16901 800-487-8784 428 Main Street, Towanda, PA 18848 888-987-8784 503 N. Elmira Street, Sayre, PA 18840 888-760-8192 3461 Rte 405 Highway, Muncy, PA 17756 570-546-6666 130 Court Street, Williamsport, PA 17701 570-601-6000 ACCOUNT SERVICES - 90-92 Main St, Wellsboro, PA 16901 800-726-2265 BANKCARD SERVICES - 11822 Route 6, Wellsboro PA 16901 800-676-6639 FUNDS MANAGEMENT - 90-92 Main St., Wellsboro, PA 16901800-577-9397 www.fmt@cnbankpa.com INTERNET BANKING - 90-92 Main St., Wellsboro, PA 16901570-724-0266 www.cnbankpa.com C&N FINANCIAL SERVICES CORPORATION - 68 Main Street, Wellsboro, PA 866-ASK-CNFS www.cnfinancialservices.com CONSOLIDATED STATEMENT OF INCOME (In Thousands, Except Per Share Data) (Unaudited)
3 MONTHS ENDED 12 MONTHS ENDED DECEMBER DECEMBER 2004 2003 2004 2003 (CURRENT) (PRIOR YR) (CURRENT) (PRIOR YR) --------- ---------- --------- ---------- Interest and Dividend Income $ 14,991 $ 13,797 $ 57,922 $ 55,223 Interest Expense 5,745 5,550 22,606 23,537 - -------------------------------------------------------------------------------------------------------------------------------- Interest Margin 9,246 8,247 35,316 31,686 Provision for Loan Losses 350 250 1,400 1,100 - -------------------------------------------------------------------------------------------------------------------------------- Interest Margin After Provision for Loan Losses 8,896 7,997 33,916 30,586 Other Income 1,815 1,722 6,922 6,595 Realized Gains on Securities, Net 1,133 1,510 2,877 4,799 Other Expenses 6,746 5,890 26,001 22,114 - -------------------------------------------------------------------------------------------------------------------------------- Income Before Income Tax Provision 5,098 5,339 17,714 19,866 Income Tax Provision 1,035 992 2,851 3,609 - -------------------------------------------------------------------------------------------------------------------------------- NET INCOME $ 4,063 $ 4,347 $ 14,863 $ 16,257 ================================================================================================================================ PER SHARE DATA (**): Net Income - Basic $0.50 $0.53 $1.82 $1.99 Net Income - Diluted $0.49 $0.53 $1.81 $1.98 Dividend Per Share $0.23 $0.22 $0.89 $0.85 Number Shares Used in Computation - Basic 8,183,801 8,173,999 8,185,466 8,170,651 Number Shares Used in Computation - Diluted 8,230,739 8,232,179 8,233,992 8,219,366
CONSOLIDATED BALANCE SHEET (In Thousands, Except Per Share Data) (Unaudited)
DEC. 31, DEC. 31, 2004 2003 ---- ---- ASSETS Cash & Due from Banks $ 18,953 $ 15,171 Available-for-Sale Securities 475,085 483,032 Loans, Net 572,826 518,800 Other Assets 56,138 49,898 - ---------------------------------------------------------------------------------------------------------------- TOTAL ASSETS $1,123,002 $1,066,901 ================================================================================================================ LIABILITIES Deposits $ 676,545 $ 658,065 Repo Sweep Accounts 21,178 23,363 - ---------------------------------------------------------------------------------------------------------------- Total Deposits and Repo Sweeps 697,723 681,428 Borrowed Funds 283,827 249,590 Other Liabilities 9,867 10,540 - ---------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES 991,417 941,558 - ---------------------------------------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY Shareholders' Equity, Excluding Net Unrealized Gains/Losses on Available-for sale Securities 121,050 113,306 Net Unrealized Gains/Losses on Available- for-sale Securities (*) 10,535 12,037 - ---------------------------------------------------------------------------------------------------------------- TOTAL SHAREHOLDERS' EQUITY 131,585 125,343 - ---------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES & SHAREHOLDERS' EQUITY $1,123,002 $1,066,901 ================================================================================================================
CONSOLIDATED FINANCIAL HIGHLIGHTS (In Thousands, Except Per Share Data) (Unaudited)
12 MONTHS ENDED % DECEMBER INCREASE 2004 2003 (DECREASE) ---- ---- ------------ EARNINGS PERFORMANCE Net Income $ 14,863 $ 16,257 -8.57% Return on Average Assets 1.33% 1.57% -15.29% Return on Average Assets, Excluding Unrealized Gains/Losses on Available-for-Sale Securities (***) 1.35% 1.60% -15.63% Return on Average Equity 11.58% 13.30% -12.93% Return on Average Equity, Excluding Unrealized Gains/Losses on Available-for-Sale Securities (***) 12.63% 14.93% -15.41% BALANCE SHEET HIGHLIGHTS Total Assets $ 1,123,002 $ 1,066,901 5.26% Available-for-Sale Securities 475,085 483,032 -1.65% Loans (Net) 572,826 518,800 10.41% Allowance for Loan Losses 6,787 6,097 11.32% Deposits and Repo Sweep Accounts 697,723 681,428 2.39% Trust Assets Under Management 383,062 329,615 16.21% SHAREHOLDERS' VALUE (PER SHARE) (**) Net Income - Basic $1.82 $1.99 -8.54% Net Income - Diluted $1.81 $1.98 -8.59% Dividends $0.89 $0.85 4.71% Book Value $ 16.08 $ 15.33 4.89% Book Value, Excluding Unrealized Gains/Losses on Available-for- sale Securities (***) $ 14.79 $ 13.86 6.71% Market Value (Last Trade) $ 27.00 $ 27.00 0.00% Market Value / Book Value 167.91% 176.13% -4.67% Market Value / Book Value, Excluding Unrealized Gains/Losses on Available-for-Sale Securities (***) 182.56% 194.81% -6.29% Price Earnings Multiple 14.84 13.57 9.36% Dividend Yield 3.30% 3.15% 4.76% SAFETY AND SOUNDNESS Shareholders' Equity / Average Assets, Excluding Unrealized Gains/Losses on Available-for-Sale Securities (***) 10.72% 10.73% -0.09% Nonperforming Assets / Total Assets 0.69% 0.11% 527.27% Allowance for Loan Losses / Total Loans 1.17% 1.16% 0.86% Risk Based Capital Ratio 18.90% 20.61% -8.30% AVERAGE BALANCES Average Assets $ 1,114,040 $ 1,034,720 7.67% Average Assets, Excluding Unrealized Gains/Losses on Available-for-sale Securities 1,097,858 1,014,424 8.22% Average Equity 128,374 122,271 4.99% Average Equity, Excluding Unrealized Gains/Losses on Available-for-sale Securities 117,695 108,876 8.10%
(*) Net unrealized gains/losses on available-for-sale securities are presented as "Accumulated Other Comprehensive Income" in the annual and quarterly financial statements filed with the Securities and Exchange Commission. (**) For purposes of per share calculations, the market value and number of outstanding shares have been retroactively adjusted for the effects of the 3-for-2 stock split issued in April 2003, and for 1% stock dividends issued in January of each year presented. (***) Generally accepted accounting principles ("GAAP") require that available-for-sale securities be reported at fair value, with unrealized gains and losses excluded from earnings and reported separately through shareholders' equity, net of tax. Management believes there is an inherent mismatch between the income statement and balance sheet related to unrealized gains/losses that may create a material inconsistency in the calculation of earnings-based ratios. Further, the amount of unrealized gains or losses may vary widely from period-to-period, depending on the financial markets as a whole and interest rate movements. Therefore, management has provided these "non-GAAP" ratios because we believe they provide meaningful information for evaluating the Corporation's financial position and results of operations. -----END PRIVACY-ENHANCED MESSAGE-----