EXHIBIT 99.1

 

 

 

Contact:  Kathleen Campbell, Marketing Director		First Citizens Community Bank
570-662-0422		15 S. Main Street
570-662-8512 (fax)		Mansfield, PA 16933

 

 

Citizens Financial Services, Inc. Reports unaudited third Quarter 2016 Earnings

MANSFIELD, PENNSYLVANIA— October 26, 2016 – Citizens Financial Services, Inc. (OTC BB: CZFS), parent company of First Citizens Community Bank, released today its unaudited financial results for the three and nine months ended September 30, 2016.

For the nine months ended September 30, 2016, net income totaled $9,467,000 which compares to net income of $9,166,000 for the first nine months of 2015.  Year to date through September 30, 2016 the provision for loan loss totaled $770,000, which compares to $360,000 for the same period last year and is attributable primarily to overall loan growth.  Basic earnings per share of $2.83 for the first nine months of 2016 compares to $3.00 per share for the first nine months last year.  Annualized return on equity for the nine months ended September 30, 2016 and 2015 was 10.28% and 11.93%, while return on assets was 1.06% and 1.31%, respectively.

For the three months ended September 30, 2016, net income totaled $3,153,000 which compares to net income of $2,857,000 for the third quarter of 2015, an increase of $296,000.  Basic earnings per share of $.94 for the third quarter of 2016 compares to $.94 per share for the third quarter last year.  Annualized return on equity for the three months ended September 30, 2016 and 2015 was 10.17% and 11.00%, while return on assets was 1.06% and 1.21%, respectively.

Net interest income before the provision for loan loss has increased from $22,793,000 for the nine months ended September 30, 2015 to $28,088,000 for 2016, an increase of $5,295,000 or 23.2%.  This increase is attributable to growth, both from the acquisition of The First National Bank of Fredericksburg (FNB) in December 2015 and strong loan growth during 2016.  The net interest margin has decreased from 3.78% last year to 3.67% for 2016, and is reflective of the persistent interest rate environment and competitive pressures.

CEO and President Randall E. Black stated, "These are exciting times here at Citizens, our financial results continue to remain solid, but do reflect costs and investments to support our strategic efforts and growth initiatives.  In addition to the increased costs associated with the acquisition of FNB, the addition of two lending teams has also resulted in increased operating expenses, however, as you can see, these investments, even though in the early stages, are starting to produce results as evidenced by the third quarter loan growth."

At September 30, 2016, total assets were $1.19 billion which compares to $1.16 billion at December 31, 2015.  Available for sale securities of $349.2 million at September 30, 2016 decreased $10.5 million from December 31, 2015 due to the unfavorable investment environment and the growth in the loan portfolio.  Net loans have increased $55.2 million compared to the end of last year, with growth expected for the remainder of the year due to the increased lending staff and strategic efforts.  Since December 31, 2015, deposits have increased $20.7 million, to a total of $1.0 billion at September 30, 2016.

Stockholders' equity totaled $125.6 million at September 30, 2016, which compares to $119.8 million at December 31, 2015, an increase of $5.8 million.  Net income for the nine months of 2016 totaling $9.5 million was offset by cash dividends of $4.2 million and net treasury share purchases of $1.1 million.  As a result of changes in interest rates impacting the fair value of investment securities, accumulated other comprehensive income attributable to the unrealized gain on available for sale investment securities increased $1.5 million from the end of 2015.  A cash dividend for the third quarter of 2016 of $.42 per share was paid on September 30, 2016 to shareholders of record on September 16, 2016, and represents an increase of 2.5% over the regular cash dividend paid a year ago, excluding the $.10 one-time special dividend paid in the third quarter of 2015.

Citizens Financial Services, Inc. has nearly 1,700 shareholders, the majority of whom reside in markets where offices are located.

Note: This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995.  These statements are not historical facts; rather, they are statements based on the Company's current expectations regarding its business strategies and their intended results and its future performance.  Forward-looking statements are preceded by terms such as "expects," "believes," "anticipates," "intends" and similar expressions.  Forward-looking statements are not guarantees of future performance.  Numerous risks and uncertainties could cause or contribute to the Company's actual results, performance and achievements to be materially different from those expressed or implied by the forward-looking statements. Factors that may cause or contribute to these differences include, without limitation, changes in general economic conditions, including changes in market interest rates and changes in monetary and fiscal policies of the federal government; legislative and regulatory changes; and other factors disclosed periodically in the Company's filings with the Securities and Exchange Commission.  Because of the risks and uncertainties inherent in forward-looking statements, readers are cautioned not to place undue reliance on them, whether included in this press release or made elsewhere periodically by the Company or on its behalf.  The Company assumes no obligation to update any forward-looking statements except as may be required by applicable law or regulation.

 

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