Peoples Federal Bancshares, Inc. - FORM 8-K - EX-99.1

Attached files

file	filename
8-K - 8-K - Peoples Federal Bancshares, Inc.	a13-17191_18k.htm

Exhibit 99.1

FOR IMMEDIATE RELEASE
	Contact: Maurice H. Sullivan, Jr.
	(617) 254-0707

PEOPLES FEDERAL BANCSHARES, INC. ANNOUNCES THIRD QUARTER
AND YEAR TO DATE RESULTS FOR FISCAL YEAR 2013

Brighton, Massachusetts, July 26, 2013. Peoples Federal Bancshares, Inc. (the “Company”) (Nasdaq: PEOP), the holding company for Peoples Federal Savings Bank (the “Bank”), announced third quarter and year to date earnings for the fiscal year ending September 30, 2013. For the quarter ended June 30, 2013, the Company reported net income of $598,000 or $0.10 per share, basic and diluted, as compared to net income of $567,000 or $0.09 per share, basic and diluted, for the same period last year and net income of $545,000, or $0.09 per share, basic and diluted, for the quarter ended March 31, 2013. For the nine months ended June 30, 2013, the Company reported net income of $1.8 million or $0.30 per share, basic and diluted, as compared to net income of $2.0 million or $0.31 per share, basic and diluted, for the same period last year.

For both the quarters ended June 30, 2013 and 2012, net interest and dividend income totaled $4.2 million. Low market interest rates have continued to pressure net interest income as recently originated loans reflect current market conditions. Of note during the June 2013 quarter, a non-accruing commercial real estate loan, previously categorized as impaired and classified as substandard paid off. As a result, the Bank recognized $79,000 in interest and fees on loans and a total of $46,000 in other income and recovered expenses. Non-interest income totaled $472,000 for the quarter ended June 30, 2013, as compared to $443,000 for the quarter ended June 30, 2012. Non-interest expense totaled $3.6 million for the quarter ended June 30, 2013 as well as the quarter ended June 30, 2012.

For the nine month periods ended June 30, 2013 and 2012, net interest and dividend income totaled $12.5 million and $12.7 million, respectively. Low market interest rates have continued to pressure net interest income as recently originated loans reflect current market conditions. Non-interest income totaled $1.5 million for the nine months ended June 30, 2013, as compared to $1.3 million for the nine months ended June 30, 2012. Non-interest expense totaled $10.6 million for the nine months ended June 30, 2013, as compared to $10.5 million for the nine months ended June 30, 2012, reflecting higher salaries and employee benefits offset mainly by a decrease in advertising expense and other expense.

On a linked quarter basis, net interest and dividend income for the Company’s 2013 third fiscal quarter increased $103,000, or 2.5%, to $4.2 million from $4.1 million for the second fiscal quarter ended March 31, 2013, reflecting the payoff of the loan noted above as well as continued efforts to maintain the net interest margin. Non-interest income for the third quarter of fiscal 2013 decreased to $472,000 from $488,000 for the second fiscal quarter ended March 31, 2013. Non-interest expense remained stable at $3.6 million for both the third fiscal quarter ended June 30, 2013 and the second fiscal quarter ended March 31, 2013.

Total assets increased $3.7 million, or 0.6%, to $574.5 million at June 30, 2013 from $570.8 million at September 30, 2012. Loans, net increased $2.3 million, or 0.5%, as residential real estate, construction and commercial loans all increased while commercial real estate and consumer loans

declined. Cash and cash equivalents increased $7.1 million to $43.3 million at June 30, 2013 from $36.2 million at September 30, 2012. Securities available-for-sale and held-to-maturity decreased $5.3 million, or 11.2%, to $42.3 million at June 30, 2013 from $47.6 million at September 30, 2012. Borrowings remained at $33.0 million for both the June 30, 2013 and September 30, 2012 periods.

Deposits increased $6.9 million to $423.6 million at June 30, 2013 from $416.7 million at September 30, 2012. Savings accounts increased $5.5 million, demand deposits increased $5.3 million, and NOW accounts increased $1.5 million, while term certificates decreased $3.6 million and money market accounts decreased $1.8 million. At June 30, 2013, total stockholders’ equity was $107.0 million, a decrease of $3.5 million from $110.5 million at September 30, 2012. The decrease in stockholders’ equity during the nine-month period was primarily due to dividends paid of $2.1 million and the repurchase and retirement of 253,900 shares, or $4.5 million, of the Company’s common stock pursuant to our stock repurchase plan, offset by net income of $1.8 million, stock based compensation expense of $1.0 million and common stock released and committed to be released by the ESOP of $380,000.

During the quarter ended June 30, 2013, the Company paid a quarterly cash dividend of $0.04 per common share. The dividends paid totaled $244,000 during the quarter. The Company did not pay any dividends during the quarter ended June 30, 2012.

Non-performing assets totaled $1.9 million, or 0.3% of total assets, at June 30, 2013, compared to $3.4 million, or 0.6% of total assets, at September 30, 2012 and $2.0 million, or 0.4% of total assets, at March 31, 2013. Classified assets decreased to $3.5 million at June 30, 2013, as compared to $9.6 million at September 30, 2012 and $4.1 million at March 31, 2013. The Company did not provide a contribution to the allowance for loan losses during the quarter ended June 30, 2013 reflecting little change in net loans and improvements in loan delinquencies, non-performing assets and classified assets.

Certain statements herein constitute “forward-looking statements” and actual results may differ from those contemplated by these statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such as “will,” “would,” “should,” “could” or “may.” Certain factors that could cause actual results to differ materially from expected results include changes in the interest rate environment, changes in general economic conditions, legislative and regulatory changes that adversely affect the businesses in which Peoples Federal Bancshares, Inc. is engaged and changes in the securities market. The Company disclaims any intent or obligation to update any forward-looking statements, whether in response to new information, future events or otherwise.

PEOPLES FEDERAL BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	June 30,			September 30,
	2013			2012
	(Unaudited)
	(In thousands, except share data)
ASSETS
Cash and due from banks	$	3,766		$	6,713
Interest-bearing demand deposits with other banks	37,335			27,378
Federal funds sold	131			48
Federal Home Loan Bank - overnight deposit	2,102			2,102
Total cash and cash equivalents	43,334			36,241
Securities available-for-sale	14,424			21,653
Securities held-to-maturity (fair values of $27,643 and $26,746)	27,825			25,921
Federal Home Loan Bank stock (at cost)	3,775			4,014
Loans	457,324			454,925
Allowance for loan losses	(4,025		)	(3,891		)
Loans, net	453,299			451,034
Premises and equipment, net	3,434			3,577
Cash surrender value of life insurance policies	19,850			19,364
Accrued interest receivable	1,453			1,589
Deferred income tax asset, net	5,406			5,116
Other assets	1,731			2,318
Total assets	$	574,531		$	570,827

LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits:
Non-interest bearing	$	54,471		$	49,165
Interest-bearing	369,156			367,583
Total deposits	423,627			416,748
Short-term borrowings	6,000			8,000
Long-term debt	27,000			25,000
Accrued expenses and other liabilities	10,937			10,541
Total liabilities	467,564			460,289

Stockholders’ equity:
Preferred stock, $0.01 par value; 50,000,000 shares authorized; none issued	—			—
Common stock, $0.01 par value; 100,000,000 shares authorized; 6,473,004 and 6,726,904 shares issued and outstanding at June 30, 2013 and September 30, 2012, respectively	65			67
Additional paid-in capital	59,915			63,909
Retained earnings	54,881			55,153
Accumulated other comprehensive (loss) income	(58		)	113
Unearned restricted shares; 201,885 and 244,140 shares at June 30, 2013 and September 30, 2012, respectively	(3,123		)	(3,777		)
Unearned compensation - ESOP	(4,713		)	(4,927		)
Total stockholders’ equity	106,967			110,538
Total liabilities and stockholders’ equity	$	574,531		$	570,827

PEOPLES FEDERAL BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended				Nine Months Ended
	June 30,				June 30,
	2013		2012		2013		2012
	(Unaudited)
	(Dollars in thousands, except share data)
Interest and dividend income:
Interest and fees on loans	$	4,644	$	4,793	$	14,116	$	14,466
Interest on debt securities:
Taxable	147		210		417		723
Other interest	26		18		70		59
Dividends on equity securities	3		5		12		14
Total interest and dividend income	4,820		5,026		14,615		15,262

Interest expense:
Interest on deposits	501		673		1,668		2,128
Interest on Federal Home Loan Bank advances	152		147		452		409
Total interest expense	653		820		2,120		2,537
Net interest and dividend income	4,167		4,206		12,495		12,725
Provision for loan losses	—		125		200		375
Net interest and dividend income, after provision for loan losses	4,167		4,081		12,295		12,350

Non-interest income:
Customer service fees	213		213		616		628
Loan servicing fees	16		20		30		7
Net gain on sales of mortgage loans	42		42		189		49
Increase in cash surrender value of life insurance	143		161		486		490
Other income	58		7		131		97
Total non-interest income	472		443		1,452		1,271

Non-interest expense:
Salaries and employee benefits	2,444		2,440		7,173		7,047
Occupancy expense	241		222		719		682
Equipment expense	87		109		294		333
Professional fees	104		131		398		355
Advertising expense	142		140		379		448
Data processing expense	218		200		637		600
Deposit insurance expense	81		66		211		176
Other expense	254		284		768		810
Total non-interest expense	3,571		3,592		10,579		10,451
Income before income taxes	1,068		932		3,168		3,170
Provision for income taxes	470		365		1,344		1,190
Net income	$	598	$	567	$	1,824	$	1,980

Weighted-average shares outstanding:
Basic	5,869,813		6,114,060		5,913,414		6,239,816
Diluted	5,905,052		6,144,309		5,950,470		6,251,384

Earnings per common share:
Basic	$	0.10	$	0.09	$	0.30	$	0.31
Diluted	$	0.10	$	0.09	$	0.30	$	0.31

PEOPLES FEDERAL BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended
	June 30,		March 31,
	2013		2013
	(Unaudited)
	(Dollars in thousands, except share data)
Interest and dividend income:
Interest and fees on loans	$	4,644	$	4,619
Interest on debt securities:
Taxable	147		120
Other interest	26		26
Dividends on equity securities	3		4
Total interest and dividend income	4,820		4,769

Interest expense:
Interest on deposits	501		555
Interest on Federal Home Loan Bank advances	152		150
Total interest expense	653		705
Net interest and dividend income	4,167		4,064
Provision for loan losses	—		80
Net interest and dividend income, after provision for loan losses	4,167		3,984

Non-interest income:
Customer service fees	213		193
Loan servicing fees	16		6
Net gain on sales of mortgage loans	42		46
Increase in cash surrender value of life insurance	143		181
Other income	58		62
Total non-interest income	472		488

Non-interest expense:
Salaries and employee benefits	2,444		2,403
Occupancy expense	241		249
Equipment expense	87		101
Professional fees	104		177
Advertising expense	142		108
Data processing expense	218		211
Deposit insurance expense	81		61
Other expense	254		257
Total non-interest expense	3,571		3,567
Income before income taxes	1,068		905
Provision for income taxes	470		360
Net income	$	598	$	545

Weighted-average shares outstanding:
Basic	5,869,813		5,894,114
Diluted	5,905,052		5,914,177

Earnings per common share:
Basic	$	0.10	$	0.09
Diluted	$	0.10	$	0.09

The following tables set forth average assets, liability and equity account balances, average yields and costs, and certain other information for the periods indicated. No tax-equivalent yield adjustments were made, as the effect thereof was not material. All average balances are daily average balances. Non-accrual loans were included in the computation of average balances, but have been reflected in the table as loans carrying a zero yield. The yields set forth below include the effect of deferred fees, discounts and premiums that are amortized or accreted to interest income or expense.

	Three Months Ended June 30,
	2013							2012
	Average			Interest		Average		Average			Interest		Average
	Outstanding			Earned/		Yield/		Outstanding			Earned/		Yield/
	Balance			Paid		Rate (1)		Balance			Paid		Rate (1)
	(Unaudited)
	(Dollars in thousands)
Interest-earning assets:
Loans (2)	$	450,486		$	4,644	4.12	%	$	424,263		$	4,793	4.52	%
Taxable securities (3)	39,533			147		1.49		57,234			210		1.47
Other interest-earning assets	44,511			26		0.23		25,552			18		0.28
FHLB stock	3,775			3		0.32		4,014			5		0.50
Total interest-earning assets	538,305			4,820		3.58		511,063			5,026		3.93
Non-interest-earning assets	35,920							47,065
Total assets	$	574,225						$	558,128

Interest-bearing liabilities:
Deposits:
Savings	$	54,572		17		0.12		$	49,299		23		0.19
Money market accounts	152,231			173		0.45		154,959			266		0.69
NOW accounts	39,035			6		0.06		37,441			11		0.12
Term certificates	125,434			305		0.97		128,314			373		1.16
Total deposits	371,272			501		0.54		370,013			673		0.73
FHLB advances	33,000			152		1.84		24,000			147		2.45
Total interest-bearing liabilities	404,272			653		0.65		394,013			820		0.83
Demand deposits	52,647							42,577
Other non-interest-bearing liabilities	9,089							8,766
Total non-interest-bearing liabilities	61,736							51,343
Total liabilities	466,008							445,356
Stockholders’ equity	108,217							112,772
Total liabilities and stockholders’ equity	$	574,225						$	558,128

Net interest income				$	4,167						$	4,206
Net interest rate spread (4)						2.93	%						3.10	%
Net interest-earning assets (5)	$	134,033						$	117,050
Net interest margin (6)						3.10	%						3.29	%
Ratio of interest-earning assets to total interest-bearing liabilities	1.33		x					1.30		x

(1) Yields are annualized.

(2) Average loans include non-accrual loans and are net of average deferred loan fees/costs.

(3) Average balances are presented at average amortized cost.

(4) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(6) Net interest margin represents net interest income divided by average total interest-earning assets.

	Nine Months Ended June 30,
	2013							2012
	Average			Interest		Average		Average			Interest		Average
	Outstanding			Earned/		Yield/		Outstanding			Earned/		Yield/
	Balance			Paid		Rate (1)		Balance			Paid		Rate (1)
	(Unaudited)
	(Dollars in thousands)
Interest-earning assets:
Loans (2)	$	450,874		$	14,116	4.17	%	$	415,807		$	14,466	4.64	%
Taxable securities (3)	39,077			417		1.42		58,586			723		1.65
Other interest-earning assets	44,168			70		0.21		28,738			59		0.27
FHLB stock	3,916			12		0.41		4,202			14		0.44
Total interest-earning assets	538,035			14,615		3.62		507,333			15,262		4.01
Non-interest-earning assets	35,963							46,360
Total assets	$	573,998						$	553,693

Interest-bearing liabilities:
Deposits:
Savings	$	52,964		56		0.14		$	48,359		72		0.20
Money market accounts	153,624			609		0.53		154,023			830		0.72
NOW accounts	37,932			18		0.06		36,481			33		0.12
Term certificates	127,429			985		1.03		131,045			1,193		1.21
Total deposits	371,949			1,668		0.60		369,908			2,128		0.77
FHLB advances	32,788			452		1.84		20,613			409		2.65
Total interest-bearing liabilities	404,737			2,120		0.70		390,521			2,537		0.87
Demand deposits	51,081							40,481
Other non-interest-bearing liabilities	9,274							8,670
Total non-interest-bearing liabilities	60,355							49,151
Total liabilities	465,092							439,672
Stockholders’ equity	108,906							114,021
Total liabilities and stockholders’ equity	$	573,998						$	553,693

Net interest income				$	12,495						$	12,725
Net interest rate spread (4)						2.92	%						3.14	%
Net interest-earning assets (5)	$	133,298						$	116,812
Net interest margin (6)						3.10	%						3.34	%
Ratio of interest-earning assets to total interest-bearing liabilities	1.33		x					1.30		x

(1) Yields are annualized.

(2) Average loans include non-accrual loans and are net of average deferred loan fees/costs.

(3) Average balances are presented at average amortized cost.

(4) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(6) Net interest margin represents net interest income divided by average total interest-earning assets.

	Three Months Ended
	June 30, 2013							March 31, 2013
	Average			Interest		Average		Average			Interest		Average
	Outstanding			Earned/		Yield/		Outstanding			Earned/		Yield/
	Balance			Paid		Rate (1)		Balance			Paid		Rate (1)
	(Unaudited)
	(Dollars in thousands)
Interest-earning assets:
Loans (2)	$	450,486		$	4,644	4.12	%	$	449,549		$	4,619	4.11	%
Taxable securities (3)	39,533			147		1.49		35,566			120		1.35
Other interest-earning assets	44,511			26		0.23		50,678			26		0.21
FHLB stock	3,775			3		0.32		3,958			4		0.40
Total interest-earning assets	538,305			4,820		3.58		539,751			4,769		3.53
Non-interest-earning assets	35,920							36,427
Total assets	$	574,225						$	576,178

Interest-bearing liabilities:
Deposits:
Savings	$	54,572		17		0.12		$	53,538		20		0.15
Money market accounts	152,231			173		0.45		155,630			200		0.51
NOW accounts	39,035			6		0.06		37,683			6		0.06
Term certificates	125,434			305		0.97		129,105			329		1.02
Total deposits	371,272			501		0.54		375,956			555		0.59
FHLB advances	33,000			152		1.84		32,911			150		1.82
Total interest-bearing liabilities	404,272			653		0.65		408,867			705		0.69
Demand deposits	52,647							49,945
Other non-interest-bearing liabilities	9,089							9,088
Total non-interest-bearing liabilities	61,736							59,033
Total liabilities	466,008							467,900
Stockholders’ equity	108,217							108,278
Total liabilities and stockholders’ equity	$	574,225						$	576,178

Net interest income				$	4,167						$	4,064
Net interest rate spread (4)						2.93	%						2.84	%
Net interest-earning assets (5)	$	134,033						$	130,884
Net interest margin (6)						3.10	%						3.01	%
Ratio of interest-earning assets to total interest-bearing liabilities	1.33		x					1.32		x

(1) Yields are annualized.

(2) Average loans include non-accrual loans and are net of average deferred loan fees/costs.

(3) Average balances are presented at average amortized cost.

(4) Net interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.

(5) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(6) Net interest margin represents net interest income divided by average total interest-earning assets.

Peoples Federal Bancshares, Inc. - FORM 8-K - EX-99.1 - July 26, 2013

Attached files

Peoples Federal Bancshares, Inc. Reports