JASPER, Ala.--(BUSINESS WIRE)--Robert B. Nolen, Jr., President and Chief Executive Officer of Pinnacle Bancshares, Inc. (OTCBB:PCLB), today announced Pinnacle’s results of operations for the fourth quarter and year ended December 31, 2012:
- For the three months ended December 31, 2012, Pinnacle reported net income of $506,000, compared to $461,000 for the three months ended December 31, 2011.
- Net interest income before the provision for loan losses for the three months ended December 31, 2012 was $1,803,000, compared with $1,896,000 in the same period last year.
- For the year ended December 31, 2012, net income was $1,955,000, compared with net income of $1,236,000 in the prior year.
- Net interest income before the provision for loan losses for the year ended December 31, 2012, was $7,374,000, compared with $7,817,000 in the prior year.
- For the three months ended December 31, 2012, basic and diluted earnings were each $0.42 per share. For the same period in 2011, basic and diluted earnings were each $0.36 per share.
- Basic and diluted earnings were each $1.59 per share for the year ended December 31, 2012. For 2011, basic and diluted earnings were each $0.97 per share.
Mr. Nolen commented: “Our strategy is to continue to provide high quality products and services to, and practice relationship banking with, our customers who live and conduct business in our market area. We focus on loan quality which should enhance our performance in a challenging environment. Although loan growth has been limited, our core deposits and asset quality ratios have remained strong, and we have conservatively managed our investment portfolio, which we expect will provide significant flexibility if loan volumes begin to increase.”
The Company’s net interest margin was 3.82% and 3.92% for the three months and year ended December 31, 2012, respectively, compared to 4.11% and 4.13% for the three months and year ended December 31, 2011, respectively.
Other income remained stable. Fees and service charges declined slightly from 2011 to 2012 as rule changes implemented from the Dodd-Frank Act reduced certain fees Pinnacle charges. This was offset by gain on sale of loans held for sale as home mortgage production improved from 2011 to 2012.
Other expenses decreased $619,000 from 2011 to 2012. This was due to a $211,000 reduction in compensation and benefits from staff reduction, and a $136,000 reduction in net loss on sales of real estate. In addition there was an approximately $240,000 reduction in other expenses, primarily FDIC insurance, legal fees and supplies.
At December 31, 2012, Pinnacle’s allowance for loan losses as a percent of total loans was 2.07%, compared to 2.13% at December 31, 2011. At December 31, 2012, the allowance for loan losses as a percent of nonperforming loans was 1018.00%, compared to 211.68% at December 31, 2011. Based on current real estate valuations, Pinnacle believes its allowance for loan losses is adequate.
Charge-offs, net of recoveries, were $393,000 in 2012, compared to $1,315,000 in the prior year. Nonperforming assets were $548,000 at December 31, 2012, compared to $1,457,000 at December 31, 2011. The ratio of nonperforming assets to total loans was .56% at December 31, 2012, compared to 1.39% at December 31, 2011. “The declining levels of charge-offs and non-performing assets reflect our continued efforts to address and resolve problem loan issues aggressively. These improvements allowed us to reduce the provision for loan losses to $200,000 in 2012 compared to $1,100,000 in 2011,” said Mr. Nolen.
Despite recent improvements, Mr. Nolen cautioned investors that economic conditions and financial stresses including job losses, have had and could continue to have an adverse affect on Pinnacle’s borrowers and their customers, which could adversely affect Pinnacle’s financial condition and results of operations.
Deterioration in local economic conditions in Pinnacle’s markets could drive losses beyond those which are provided for in the allowance for loan losses and result in a number of adverse consequences, including increases in loan delinquencies; increases in nonperforming assets; decreases in demand for Pinnacle’s products and services, which could affect Pinnacle’s liquidity position; and decreases in the value of the collateral securing Pinnacle’s loans, which could reduce customers’ borrowing power.
Information contained in this press release, other than historical information, may be considered forward-looking in nature and is subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected.
Pinnacle Bancshares, Inc.’s wholly owned subsidiary Pinnacle Bank has seven offices located in central and northwest Alabama.
| PINNACLE BANCSHARES, INC | ||||||||||
| Unaudited Financial Highlights | ||||||||||
| Three Months Ended December 31, | ||||||||||
| 2012 | 2011 | |||||||||
| Net Income (loss) | $ | 506,000 | $ | 461,000 | ||||||
| Weighted average basic shares outstanding |
1,205,128 |
1,270,128 | ||||||||
| Weighted average diluted shares outstanding | 1,205,128 | 1,270,128 | ||||||||
| Dividend per share | $ | 0.22 | $ | 0.11 | ||||||
| Provision for loan losses | $ | 50,000 | $ | 50,000 | ||||||
| Basic earnings (loss) per share | $ | 0.42 | $ | .0.36 | ||||||
| Diluted earnings (loss) per share | $ | 0.42 | $ | 0.36 | ||||||
| Performance Ratios: (annualized) | ||||||||||
| Return on average assets | 0.99 | % | 0.90 | % | ||||||
| Return on average equity | 8.80 | % | 8.34 | % | ||||||
| Interest rate spread | 3.81 | % | 4.10 | % | ||||||
| Net interest margin | 3.82 | % | 4.11 | % | ||||||
| Operating cost to assets | 3.09 | % | 3.24 | % | ||||||
| At December 31, | ||||||||||
| 2012 | 2011 | |||||||||
| Net Income | $ | 1,955,000 | $ | 1,236,000 | ||||||
| Weighted average basic shares outstanding | 1,228,279 | 1,270,128 | ||||||||
| Weighted average diluted shares outstanding | 1,228,279 | 1,270,128 | ||||||||
| Dividend per share | $ | 0.55 | $ | 0.44 | ||||||
| Provision for loan losses | $ | 200,000 | $ | 1,100,000 | ||||||
| Basic earnings per share | $ | 1.59 | $ | 0.97 | ||||||
| Diluted earnings per share | $ | 1.59 | $ | 0.97 | ||||||
| Performance Ratios: | ||||||||||
| Return on average assets | 0.95 | % | 0.60 | % | ||||||
| Return on average equity | 8.49 | % | 5.59 | % | ||||||
| Interest rate spread | 3.90 | % | 4.12 | % | ||||||
| Net interest margin | 3.92 | % | 4.13 | % | ||||||
| Operating cost to assets | 2.98 | % | 3.28 | % | ||||||
| At December 31, | ||||||||||
| 2012 | 2011 | |||||||||
| Total assets | $ | 208,391,000 | $ | 199,231,000 | ||||||
| Loans receivable, net | $ | 96,359,000 | $ | 102,446,000 | ||||||
| Deposits | $ | 177,313,000 | $ | 170,577,000 | ||||||
|
Total stockholders’ equity |
$ | 22,770,000 | $ | 22,334,000 | ||||||
| Weighted average book value per share | $ | 18.54 | $ | 17.58 | ||||||
|
Total stockholders’ equity to asset ratio |
10.93 | % | 11.21 | % | ||||||
| Asset Quality Ratios: | ||||||||||
| Nonperforming loans as a percent of total loans | .20 | % | 1.01 | % | ||||||
| Nonperforming assets as a percent of total Loans | .56 | % | 1.39 | % | ||||||
| Allowance for loan losses as a percent of total loans | 2.07 | % | 2.13 | |||||||
|
Allowance for loan losses as a percent of nonperforming loans |
1018.00 | % | 211.68 | % | ||||||
|
|
||||||||||
|
PINNACLE BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CONDITION |
||||||||||
| 2012 | 2011 | |||||||||
|
Assets |
||||||||||
| Cash and cash equivalents | $ | 1,332,968 | $ | 2,510,642 | ||||||
| Interest bearing deposits in banks | 2,234,882 | 1,613,466 | ||||||||
| Securities available for sale | 91,693,374 | 75,734,778 | ||||||||
| Restricted equity securities | 994,800 | 957,800 | ||||||||
| Loans held for sale | 395,801 | - | ||||||||
| Loans | 97,998,866 | 104,674,158 | ||||||||
| Less allowance for loan losses | 2,036,110 | 2,228,664 | ||||||||
| Loans, net | 95,962,756 |
102,445,514 |
||||||||
| Other real estate owned | 347,824 | 403,881 | ||||||||
| Premises and equipment, net | 6,039,211 | 6,186,794 | ||||||||
| Goodwill | 306,488 | 306,488 | ||||||||
| Bank owned life insurance | 7,463,963 | 7,117,402 | ||||||||
| Accrued interest receivable | 901,784 | 1,018,331 | ||||||||
| Other assets | 716,917 | 935,476 | ||||||||
| Total assets | $ | 208,390,768 | $ | 199,230,572 | ||||||
|
Liabilities and Stockholders’ Equity |
||||||||||
| Deposits: | ||||||||||
| Noninterest-bearing | $ | 39,594,246 | $ | 32,080,544 | ||||||
| Interest-bearing | 137,719,659 | 139,267,444 | ||||||||
| Total deposits | 177,313,905 | 171,347,988 | ||||||||
| Repurchase agreements | 118,793 | 984,957 | ||||||||
| Other borrowings | 3,800,000 | - | ||||||||
| Subordinated debentures | 3,093,000 | 3,093,000 | ||||||||
| Accrued interest payable | 110,311 | 182,020 | ||||||||
| Other liabilities | 1,184,534 | 1,288,204 | ||||||||
| Total liabilities | 185,620,543 | 176,896,169 | ||||||||
| Stockholders’ equity | ||||||||||
|
Common stock, $.01 par value, 2,400,000 shares authorized; 1,872,313 shares issued; 1,205,128 and 1,270,128 shares outstanding |
18,723 | 18,723 | ||||||||
| Additional paid-in capital | 8,923,223 | 8,923,223 | ||||||||
| Treasury stock, at cost (667,185 and 602,185 shares, respectively) | (7,974,814 | ) | (7,320,909 | ) | ||||||
| Retained earnings | 19,894,190 | 18,609,374 | ||||||||
| Accumulated other comprehensive income, net of tax | 1,908,903 | 2,103,992 | ||||||||
| Total stockholders’ equity | 22,770,225 | 22,334,403 | ||||||||
| Total liabilities and stockholders’ equity | $ | 208,390,768 | $ | 199,230,572 | ||||||
|
PINNACLE BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF INCOME |
||||||||
| 2012 | 2011 | |||||||
| Interest income | ||||||||
| Loans, including fees | $ | 5,716,220 | $ | 6,555,597 | ||||
| Taxable securities | 1,769,705 | 1,899,623 | ||||||
| Nontaxable securities | 692,190 | 601,355 | ||||||
| Other interest | 35,247 | 36,875 | ||||||
| Total interest income | 8,213,362 | 9,093,450 | ||||||
| Interest expense | ||||||||
| Deposits | 732,827 | 1,174,552 | ||||||
| Borrowings and repurchase agreements | 2,635 | 2,097 | ||||||
| Subordinated debentures | 103,475 | 99,607 | ||||||
| Total interest expense |
|
838,937 |
|
1,276,256 |
||||
| Net interest income | 7,374,425 | 7,817,194 | ||||||
| Provision for loan losses | 200,000 | 1,100,000 | ||||||
| Net interest income after provision for loan losses | 7,174,425 | 6,717,194 | ||||||
| Other income | ||||||||
| Fees and service charges on deposit accounts | 950,616 | 963,962 | ||||||
| Servicing fee income, net | 41,979 | 51,440 | ||||||
| Bank owned life insurance | 346,561 | 340,302 | ||||||
| Net gain on loans held for sale | 86,254 | 40,061 | ||||||
| Net gain on sales of other real estate owned | 21,240 | - | ||||||
| Net gain on sales of securities available for sale | - | 47,316 | ||||||
| Total other income | 1,446,650 | 1,443,081 | ||||||
| Other expenses | ||||||||
| Salaries and employee benefits | 2,870,620 | 3,081,447 | ||||||
| Occupancy expenses | 1,286,615 | 1,554,028 | ||||||
| Marketing and professional expenses | 298,269 | 353,188 | ||||||
| Net loss on sales of other real estate owned | - | 136,552 | ||||||
| Other operating expenses | 1,641,149 | 1,590,515 | ||||||
| Total other expenses | 6,096,653 | 6,715,730 | ||||||
| Income before income taxes | 2,524,422 | 1,444,545 | ||||||
| Income tax expense | 569,636 | 208,302 | ||||||
| Net income | $ | 1,954,786 | $ | 1,236,243 | ||||
| Basic and diluted earnings per share | $ | 1.59 | $ | 0.97 | ||||
| Cash dividends per share | $ | 0.55 | $ | 0.44 | ||||
| Weighted-average basic and diluted shares outstanding | 1,228,279 | 1,270,128 | ||||||
|
PINNACLE BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY |
|||||||||||||||||||||||||||||||
| Accumulated | |||||||||||||||||||||||||||||||
| Additional | Other | Total | |||||||||||||||||||||||||||||
|
|
Common Stock |
Paid-in | Treasury | Retained | Comprehensive | Stockholders’ | |||||||||||||||||||||||||
|
|
Shares |
Par Value | Capital | Stock | Earnings | Income | Equity | ||||||||||||||||||||||||
| Balance, December 31, 2010 | 1,872,313 | $ | 18,723 | $ | 8,923,223 | $ | (7,320,909 | ) | $ | 17,931,987 | $ | 1,099,934 | $ | 20,652,958 | |||||||||||||||||
| Net income | - | - | - | - | 1,236,243 | - | 1,236,243 | ||||||||||||||||||||||||
|
Cash dividends declared, $0.44 per share |
- | - | - | - | (558,856 | ) | - | (558,856 | ) | ||||||||||||||||||||||
| Other comprehensive income | - | - | - | - | - | 1,004,057 | 1,004,057 | ||||||||||||||||||||||||
| Balance, December 31, 2011 |
1,872,313 |
18,723 | 8,923,223 | (7,320,909 | ) | 18,609,374 | 2,103,991 | 22,334,402 | |||||||||||||||||||||||
| Net income | - | - | - | - | 1,954,786 | - | 1,954,786 | ||||||||||||||||||||||||
|
Cash dividends declared, $0.55 per share |
- | - | - | - | (669,970 | ) | - | (669,970 | ) | ||||||||||||||||||||||
| Treasury stock purchase | - | - | - | (653,905 | ) | - | - | (653,905 | ) | ||||||||||||||||||||||
| Other comprehensive income | - | - | - | - | - | (195,089 | ) | (195,089 | ) | ||||||||||||||||||||||
| Balance, December 31, 2012 | 1,872,313 | $ | 18,723 | $ | 8,923,223 | $ | (7,974,814 | ) | $ | 19,894,190 | $ | 1,908,903 | $ | 22,770,225 | |||||||||||||||||
|
PINNACLE BANCSHARES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||||
| 2012 | 2011 | |||||||||
| OPERATING ACTIVITIES | ||||||||||
| Net income | $ | 1,954,786 | $ | 1,236,243 | ||||||
| Adjustments to reconcile net income to net cash | ||||||||||
| Provided by operating activities: | ||||||||||
| Depreciation | 481,321 | 484,254 | ||||||||
| Provision for loan losses | 200,000 | 1,100,000 | ||||||||
| Deferred tax expense (benefit) | 142,138 | (86,761 | ) | |||||||
| Net amortization and accretion of securities | 274,185 | 2,578 | ||||||||
| Bank owned life insurance | (346,561 | ) | (340,302 | ) | ||||||
| Gain on sale of loans held for sale | (86,254 | ) | (40,061 | ) | ||||||
| Gain on sale of securities available for sale | - | (47,316 | ) | |||||||
| (Gain) loss on sale or write-down of other real estate owned, net | (21,240 | ) | 136,552 | |||||||
| Proceeds from sales of loans held for sale | (395,801 | ) | 251,141 | |||||||
| Decrease in accrued interest receivable | 116,547 | 16,208 | ||||||||
| Decrease in accrued interest payable | (71,709 | ) | (171,544 | ) | ||||||
| Net other operating activities | 574,379 |
(102,224 |
) | |||||||
| Net cash provided by operating activities | 2,821,791 |
|
2,438,768 |
|||||||
| INVESTING ACTIVITIES | ||||||||||
| Net decrease in loans | 5,192,805 | 9,184,171 | ||||||||
| Net (increase) decrease in interest-bearing deposits in banks | (621,416 | ) | 1,535,417 | |||||||
| Purchase of securities available for sale | (30,795,326 | ) | (29,862,416 | ) | ||||||
| Proceeds from sales of securities available for sale | - | 4,011,875 | ||||||||
| Proceeds from maturing or callable securities available for sale | 14,247,883 | 14,920,077 | ||||||||
| Purchase (redemption) of restricted equity securities | (37,000 | ) | 297,400 | |||||||
| Purchase of premises and equipment | (333,738 | ) | (206,339 | ) | ||||||
| Proceeds from sales of other real estate owned | 771,449 | 728,897 | ||||||||
| Net cash provided by investing activities | (11,575,343 | ) | 609,082 | |||||||
| FINANCING ACTIVITIES | ||||||||||
| Net decrease in deposits | 5,965,917 | (2,988,101 | ) | |||||||
| Increase in other borrowings | 3,800,000 | - | ||||||||
| Decrease in repurchase agreements | (866164 | ) | (476,910 | ) | ||||||
| Purchase of treasury stock | (653,905 | ) | - | |||||||
| Payments of cash dividends | (669,970 | ) | (558,856 | ) | ||||||
| Net cash used in financing activities | 7,575,878 | (4,023,867 | ) | |||||||
| Net decrease in cash and cash equivalents | (1,177,674 | ) | (976,017 | ) | ||||||
| Cash and cash equivalents at beginning of year | 2,510,642 | 3,486,659 | ||||||||
| Cash and cash equivalents at end of year | $ | 1,332,968 | $ | 2,510,642 | ||||||
| SUPPLEMENTAL DISCLOSURE | ||||||||||
| Cash paid (received) during the year for: | ||||||||||
| Interest | $ | 910,646 | $ | 1,447,800 | ||||||
| Taxes | $ | 488,717 | $ | (35,697 | ) | |||||
| OTHER NONCASH TRANSACTIONS | ||||||||||
| Other real estate owned acquired in settlement of loans | $ | 694,152 | $ | 705,632 | ||||||