-----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, ENRO3XmLTrjlrFPKK57hDappSaKA5TY8KiwsD+bBd+AsN1eqBN9Df1ewGbEf6Gq+ Xj5Ptu4ajfOzxAWKbWHoYA== 0000950152-05-008175.txt : 20051014 0000950152-05-008175.hdr.sgml : 20051014 20051014171251 ACCESSION NUMBER: 0000950152-05-008175 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20050930 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20051014 DATE AS OF CHANGE: 20051014 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: 051139503 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 l16423ae8vk.txt CITIZENS & NORTHERN CORPORATION 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) September 30, 2005 ------------------ 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 nine-month and three-month periods ended September 30, 2005. On October 14, 2005, Citizens & Northern Corporation issued a press release titled "C&N Announces September 30, 2005 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, Citizens & Northern Corporation's "Quarterly Report," a report that includes unaudited financial information, will be mailed to shareholders on or about October 20, 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 October 14, 2005, titled "C&N Announces September 30, 2005 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: 10/14/05 By: /s/ Craig G. Litchfield ----------------------- Chairman, President and Chief Executive Officer EX-99.1 2 l16423aexv99w1.txt EXHIBIT 99.1 Exhibit 99.1 PRESS RELAESE (CITIZENS & NORTHERN BANK LOGO) Contact: Yvonne Gill October 14, 2005 570-724-0247 ygill@cnbankpa.com C&N ANNOUNCES SEPTEMBER 30, 2005 UNAUDITED FINANCIAL RESULTS FOR IMMEDIATE RELEASE: Wellsboro, PA - Citizens & Northern Corporation announced the unaudited, consolidated financial results for Citizens & Northern Corporation and subsidiaries for the nine months ended September 30, 2005, and for the third quarter 2005, which are highlighted below. FINANCIAL HIGHLIGHTS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005: o C&N's acquisition of First State Bank (through the acquisition of Canisteo Valley Corporation, the parent company for First State Bank) was completed, effective at the end of August 2005. Including an increase in assets arising from the First State Bank acquisition of approximately $40 million, total assets increased 4.2%, to $1,183,599,000 as of September 30, 2005 from $1,135,433,000 as of September 30, 2004. o Net loans increased 12.9%, to $637,646,000 at September 30, 2005, from $564,867,000 at September 30, 2004. Excluding First State Bank, the increase in net loans was 8.7%. o Total deposits and repo sweep accounts increased 12.5%, to $782,813,000 at September 30, 2005, from $695,836,000 at September 30, 2004. Excluding First State Bank, deposits and repo sweeps increased 6.9%. o Tangible Equity/Tangible Assets Ratio was 10.45% as of September 30, 2005. Banking regulatory agencies consider 5% to be the minimum threshold, for purposes of this ratio, for banks to be considered well capitalized. o Net Income was $9,880,000 for the nine months ended September 30, 2005, down 8.5% from net income of $10,800,000 for the first nine months of 2004. Net Income Per Share was $1.20 (Basic) and $1.19 (Diluted) for the nine months ended September 30, 2005, as compared to $1.32 (Basic) and $1.31 (Diluted) for the first nine months of 2004. The First State Bank acquisition and operating results for the month of September 2005 did not have a significant impact on C&N's operating results. o Return on Average Assets was 1.16% for the first nine months of 2005, as compared to 1.30% for the first nine months of 2004. Return on Average Equity was 9.92% for the nine months ended September 30, 2005, as compared to 11.28% for the first nine months of 2004. o Cash Dividends declared by C&N increased by 4.6% for the first nine months of 2005 over the same period in 2004, to $0.69 per share. o Net interest income of $26,634,000 for the first nine months of 2005 was $564,000, or 2.2%, higher than the first nine months of 2004. Increases in loan volume have been the major reason for the growth in net interest income through the first three quarters of 2005. o Net realized gains from securities amounted to $2,388,000 for the nine months ended September 30, 2005, up $644,000 from the first nine months of 2004. o Other (noninterest) income totaled $5,741,000 in the first nine months of 2005, an increase of $634,000, or 12.4%, over the first nine months of 2004. This category includes several sources of revenue. The sources of revenue with the largest increases in the first nine months of 2005 included the following: fees related to credit card operations of $144,000; debit card fees of $123,000; dividends from Federal Home Loan Bank of Pittsburgh stock of $122,000; and Trust revenues of $106,000. o Noninterest expense increased $2,349,000 (12.2%) in the first nine months of 2005 as compared to the first nine months of 2004. Total salaries and benefit expenses increased $1,066,000, or 9.7% in the first nine months of 2005 over the first nine months of 2004, primarily due to new hires to accommodate expansion into new branches (Williamsport and South Williamsport in 2004, Jersey Shore in August 2005, and Canisteo and South Hornell, NY, in September 2005), and from the addition of new employees for support functions, such as Risk Management, Finance and Training. Furniture and equipment expense increased $761,000, or 65.6%, mainly due to depreciation and maintenance costs associated with the new core banking software system, which was implemented in the fourth quarter 2004. o The income tax provision increased $338,000, to $2,154,000 (17.9% of pre-tax income) in the first nine months of 2005 from $1,816,000 (14.4%) in the first nine months of 2004. The income tax rate as a percentage of pre-tax income increased in the first nine months of 2005 because C&N lowered its holdings of tax-exempt securities as a percentage of total assets in an effort to reduce or eliminate the need to pay alternative minimum tax. FINANCIAL HIGHLIGHTS FOR THE THIRD QUARTER 2005: o Net Income in the third quarter 2005 was $3,287,000, or 3.5%, lower than third quarter 2004 Net Income of $3,405,000. Net Income for the third quarter 2005 was down slightly from second quarter 2005 Net Income of $3,298,000. Net Income Per Share (Basic and Diluted) was $0.40 in the third quarter 2005, the same as the second quarter 2005, and down from $0.42 (Basic) and $0.41 (Diluted) in the third quarter 2004. o Cash Dividends declared by C&N increased to $0.23 per share for the third quarter 2005 from $0.22 per share for the third quarter 2004. Citizens & Northern Corporation is the parent company of Citizens & Northern Bank and First State Bank. Citizens & Northern Bank is a local, independent community bank providing complete financial, investment and insurance services through 20 full service offices throughout Tioga, Bradford, Sullivan and Lycoming counties in Pennsylvania. First State Bank provides banking services through its offices in Canisteo and South Hornell, NY. C&N can be found on the worldwide web at www.cnbankpa.com. First State Bank can be found on the web at www.fsbcanisteo.com. The Company's stock is listed on NASDAQ Capital Market Securities under the symbol CZNC. EX-99.2 3 l16423aexv99w2.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 SEPTEMBER 30, 2005 QUARTERLY REPORT Dear Shareholder: The third quarter was an active one for your company. Our long-anticipated acquisition of Canisteo Valley Corporation and its subsidiary First State Bank was completed. We are pleased to welcome the employees, directors and clients of First State to the C&N family. Our market expansion in Lycoming County continues as evidenced by the August opening of the Jersey Shore office and the October ground breaking for the Old Lycoming office, which we plan to open in the first quarter of 2006. In response to the Hurricane Katrina disaster, C&N helped raise over $50,000, which was contributed to the American Red Cross for victim relief. Our 2006 Calendar will be available in our offices shortly. The calendar features fabulous seasonal scenes of our market area taken by talented local photographers. Some would say the calendar is a work of art. The financial results for the year-to-date evidence the narrowing of the interest rate spreads and the increased costs associated with our expansion efforts and the core operating system that was installed in the fourth quarter of 2004. Those increased costs are investments in the future prosperity of C&N. The acquisition of First State Bank is accounted for in the third quarter's financial report. While total assets are up 4.2% compared to the same period last year with loans up 12.9% and deposits and repo sweeps up 12.5%, net income is down by 8.5%. Trust Assets Under Management have increased by nearly 13% to over $400 million. Our stock share price has been quite volatile since we listed on the NASDAQ. We believe that some of the volatility was driven by our entry into the Russell 2000. The board of directors declared a 23-cent quarterly dividend for the third quarter, a 4.5% increase over last year. We believe that your company is well positioned for future growth in its market area and we look forward to the opportunities and challenges that lie ahead. 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 F. David Pennypacker 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 18810570-888-2291 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 230-232 Railroad Street, JERSEY SHORE, PA 17740 570-398-4555 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, PA18848570-265-6171 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 16901800-487-8784 428 Main Street, TOWANDA, PA 18848888-987-8784 503 N. Elmira Street, SAYRE, PA 18840888-760-8192 3461 Rte 405 Highway, MUNCY, PA 17756570-546-6666 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 CANISTEO VALLEY CORPORATION 3 Main Street, Canisteo, NY 14823 607-698-4295 FIRST STATE BANK OFFICES 3 Main Street, CANISTEO, NY 14823 607-698-4295 111 Main Street, HORNELL, NY 14843 607-324-4081 www.fsbcanisteo.com CONSOLIDATED STATEMENT OF INCOME (In Thousands, Except Per Share Data) (Unaudited)
3 MONTHS ENDED 9 MONTHS ENDED SEPT SEPT 2005 2004 2005 2004 (CURRENT) (PRIOR YR) (CURRENT) (PRIOR YR) ------------ ---------- ---------- ----------- Interest and Dividend Income $ 15,571 $ 14,573 $ 45,172 $ 42,931 Interest Expense 6,426 5,665 18,538 16,861 - ------------------------------------------------------------------------------------------------------------------- Interest Margin 9,145 8,908 26,634 26,070 Provision for Loan Losses 375 350 1,125 1,050 - ------------------------------------------------------------------------------------------------------------------- Interest Margin After Provision for Loan Losses 8,770 8,558 25,509 25,020 Other Income 2,149 1,627 5,741 5,107 Realized Gains on Securities, Net 393 459 2,388 1,744 Other Expenses 7,303 6,738 21,604 19,255 - ------------------------------------------------------------------------------------------------------------------- Income Before Income Tax Provision 4,009 3,906 12,034 12,616 Income Tax Provision 722 501 2,154 1,816 - ------------------------------------------------------------------------------------------------------------------- NET INCOME $ 3,287 $ 3,405 $ 9,880 $ 10,800 =================================================================================================================== PER SHARE DATA (**): Net Income - Basic $ 0.40 $ 0.42 $ 1.20 $ 1.32 Net Income - Diluted $ 0.40 $ 0.41 $ 1.19 $ 1.31 Dividend Per Share $ 0.23 $ 0.22 $ 0.69 $ 0.66 Number Shares Used in Computation - Basic 8,215,365 8,182,851 8,206,438 8,186,014 Number Shares Used in Computation - Diluted 8,283,770 8,226,968 8,270,940 8,235,179
CONSOLIDATED BALANCE SHEET (In Thousands, Except Per Share Data) (Unaudited)
SEPT. 30, SEPT. 30, 2005 2004 --------- --------- ASSETS Cash & Due from Banks $ 31,833 $ 14,282 Available-for-Sale Securities 449,059 499,572 Loans, Net 637,646 564,867 Intangible Assets 3,470 - Other Assets 61,591 56,712 - ---------------------------------------------------------------------------------------------------------------- TOTAL ASSETS $1,183,599 $1,135,433 ================================================================================================================ LIABILITIES Deposits $ 753,008 $ 672,875 Repo Sweep Accounts 29,805 22,961 - ---------------------------------------------------------------------------------------------------------------- Total Deposits and Repo Sweeps 782,813 695,836 Borrowed Funds 258,499 298,191 Other Liabilities 10,819 12,402 - ---------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES 1,052,131 1,006,429 - ---------------------------------------------------------------------------------------------------------------- SHAREHOLDERS' EQUITY Shareholders' Equity, Excluding Net Unrealized Gains/Losses on Available-for sale Securities 125,958 118,769 Net Unrealized Gains/Losses on Available- for-sale Securities (*) 5,510 10,235 - ---------------------------------------------------------------------------------------------------------------- TOTAL SHAREHOLDERS' EQUITY 131,468 129,004 - ---------------------------------------------------------------------------------------------------------------- TOTAL LIABILITIES & SHAREHOLDERS' EQUITY $1,183,599 $1,135,433 ================================================================================================================
CONSOLIDATED FINANCIAL HIGHLIGHTS (In Thousands, Except Per Share Data) (Unaudited)
9 MONTHS ENDED % SEPT. INCREASE 2005 2004 (DECREASE) ---------- --------- -------- EARNINGS PERFORMANCE Net Income $ 9,880 $ 10,800 -8.52% Return on Average Assets 1.16% 1.30% -10.77% Return on Average Assets, Excluding Unrealized Gains/Losses on Available-for-Sale Securities (***) 1.17% 1.32% -11.36% Return on Average Equity 9.92% 11.28% -12.06% Return on Average Equity, Excluding Unrealized Gains/Losses on Available-for-Sale Securities (***) 10.60% 12.33% -14.03% BALANCE SHEET HIGHLIGHTS Total Assets $ 1,183,599 $ 1,135,433 4.24% Available-for-Sale Securities 449,059 499,572 -10.11% Loans (Net) 637,646 564,867 12.88% Allowance for Loan Losses 7,643 6,570 16.33% Deposits and Repo Sweep Accounts 782,813 695,836 12.50% Trust Assets Under Management 404,899 358,349 12.99% SHAREHOLDERS' VALUE (PER SHARE) (**) Net Income - Basic $ 1.20 $ 1.32 -9.09% Net Income - Diluted $ 1.19 $ 1.31 -9.16% Dividends $ 0.69 $ 0.66 4.55% Book Value $ 15.99 $ 15.76 1.46% Book Value, Excluding Unrealized Gains/Losses on Available-for- sale Securities (***) $ 15.32 $ 14.51 5.58% Market Value (Last Trade) $ 26.70 $ 25.00 6.80% Market Value / Book Value 166.98% 158.63% 5.26% Market Value / Book Value, Excluding Unrealized Gains/Losses on Available-for-Sale Securities (***) 174.28% 172.29% 1.16% Price Earnings Multiple 16.69 14.20 17.54% Dividend Yield 3.45% 3.52% -1.99% SAFETY AND SOUNDNESS Tangible Equity / Tangible Assets, Excluding Unrealized Gains/Losses on Available-for-Sale Securities (***) 10.45% 10.61% -1.43% Nonperforming Assets / Total Assets 0.63% 0.67% -5.97% Allowance for Loan Losses / Total Loans 1.18% 1.15% 2.61% Risk Based Capital Ratio 17.44% 18.92% -7.82% AVERAGE BALANCES Average Assets $ 1,136,301 $ 1,107,753 2.58% Average Assets, Excluding Unrealized Gains/Losses on Available-for-sale Securities 1,123,462 1,091,299 2.95% Average Equity 132,788 127,687 3.99% Average Equity, Excluding Unrealized Gains/Losses on Available-for-sale Securities 124,307 116,828 6.40%
(*) 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 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-----