Pinnacle Bancshares Announces Results for First Quarter Ended March 31, 2013

Business Wire

JASPER, Ala.--(BUSINESS WIRE)--

Robert B. Nolen, Jr., President and Chief Executive Officer of Pinnacle Bancshares, Inc. (PCLB), today announced Pinnacle’s results of operations for the first quarter ended March 31, 2013:

  • For the three months ended March 31, 2013, Pinnacle reported net income of $474,000, compared to $433,000 for the three months ended March 31, 2012,
  • Net interest income after the provision for loan losses for the three months ended March 31, 2013, was $1,664,000, compared with $1,745,000 in the same period last year.
  • For the three months ended March 31, 2013, basic and diluted earnings were each $0.39 per share. For the same period in 2012 basic and diluted earnings were each $0.34 per share.
  • For the three months ended March 31, 2013, return on average assets was 0.91%, compared to 0.84% in the comparable 2012 period.

In the first quarter of 2013, Pinnacle’s net interest margin declined primarily due to lower loan volumes. During this period, fees and service charges on deposit accounts increased $65,000, due primarily to a 10% increase in transaction deposits. Also, other expenses decreased approximately $19,000, due primarily to a decline of $65,000 in salaries and employee benefits.

The Company’s net interest margin was 3.64% for the three months March 31, 2013, compared to 4.02% for the three months ended March 31, 2012.

At March 31, 2013, Pinnacle’s allowance for loan losses as a percent of total loans was 2.20%, compared to 2.07% at December 31, 2012. At December 31, 2012, the allowance for loan losses as a percent of nonperforming loans was 286.64%, compared to 1018.00% at December 31, 2012. Based on current real estate valuations Pinnacle believes its allowance for loan losses is adequate.

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.

Mr. Nolen reminded investors that, in December 2012, the Board of Directors declared and paid a special cash dividend of $0.11 per share on the Company’s common stock. This dividend was in lieu of paying a regular quarterly cash dividend in the first quarter of 2013.

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 undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in Pinnacle’s expectations. Certain tabular presentations may not reconcile because of rounding.

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 March 31,
2013 2012
Net Income $ 474,000 $ 433,000
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 $ 0.11
Provision for loan losses $ 75,000 $ 150,000
Basic and Diluted earnings per share $ 0.39 $ 0.34
Performance Ratios: (annualized)
Return on average assets 0.91 % 0.84 %
Return on average equity 8.22 % 7.62 %
Interest rate spread 3.63 % 4.00 %
Net interest margin 3.64 % 4.02 %
Operating cost to assets 2.79 % 2.88 %
 
 
At December 31,
2013 2012
Total assets $ 209,899,000 $ 208,391,000
Loans receivable, net $ 94,238,000 $ 96,359,000
Deposits $ 182,400.00 $ 177,313,000
Total stockholders' equity $ 23,077,000 $ 22,770,000
Weighted average book value per share $ 19.15 $ 18.54
Total stockholders' equity to asset ratio 10.99 % 10.93 %
Asset Quality Ratios:
Nonperforming loans as a percent of total loans .77 % .20 %
Nonperforming assets as a percent of total Loans .51 % .56 %
Allowance for loan losses as a percent of total loans 2.20 % 2.07 %

Allowance for loan losses as a percent of nonperforming loans

286.64 % 1018.00 %
       

PINNACLE BANCSHARES, INC. AND SUBSIDIARY

 

CONSOLIDATED STATEMENTS OF CONDITION
MARCH 31

 
2013 2012

Assets

Cash and cash equivalents $ 1,550,536 $ 1,332,968
Interest bearing deposits in banks 6,971,953 2,234,882
Securities available for sale 90,567,004 91,693,374
Restricted equity securities 855,900 994,800
Loans held for sale 0 395,801
 
Loans 96,361,210 97,998,866
Less allowance for loan losses   2,123,428   2,036,110
Loans, net   94,237,782   95,962,756
 
Other real estate owned 331,019 347,824
Premises and equipment, net 5,930,396 6,039,211
Goodwill 306,488 306,488
Bank owned life insurance 7,550,376 7,463,963
Accrued interest receivable 915,092 901,784
Other assets 681,957 716,917
       
Total assets $ 209,898,503 $ 208,390,768
 

Liabilities and Stockholders’ Equity

Deposits:
Noninterest-bearing $ 38,467,655 $ 39,594,246
Interest-bearing   143,931,990   137,719,659
Total deposits 182,399,645 177,313,905
 
Repurchase agreements 208,847 118,793
Other borrowings 0 3,800,000
Subordinated debentures 3,093,000 3,093,000
Accrued interest payable 113,480 110,311
Other liabilities   1,006,164   1,184,534
Total liabilities   186,821,136  

185,620,543

 
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 20,367,280 19,894,190
Accumulated other comprehensive income, net of tax   1,742,955   1,908,903
Total stockholders’ equity   23,077,367   22,770,225
 
Total liabilities and stockholders’ equity $ 209,898,503 $

208,390,768

       

PINNACLE BANCSHARES, INC. AND SUBSIDIARY

 

CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended March 31, 2013 and 2012

 
2013 2012
Interest income
Loans, including fees $ 1,260,785 $ 1,514,785
Taxable securities 400,270 462,849
Nontaxable securities 245,720 150,651
Other interest   4,664   5,987
Total interest income   1,911,439   2,134,272
 
Interest expense
Deposits 145,959 212,056
Borrowings and repurchase agreements 1,643 364
Subordinated debentures   25,159   27,251
Total interest expense   172,761  

239,671

 
Net interest income 1,738,678 1,894,601
Provision for loan losses   75,000   150,000
Net interest income after provision for loan losses   1,663,678   1,744,601
 
Other income
Fees and service charges on deposit accounts 250,106 185,099
Servicing fee income, net 8,937 11,329
Bank owned life insurance 86,413 86,640
Net gain on loans held for sale   21,473   9,253
Total other income   366,929   292,321
 
Other expenses
Salaries and employee benefits 658,652 723,338
Occupancy expenses 250,583 223,817
Marketing and professional expenses 120,323 98,937
Net loss on sales of other real estate owned 7,959 0
Other operating expenses   421,125   431,268
Total other expenses   1,458,642   1,477,360
 
Income before income taxes 571,965 559,562
 
Income tax expense   98,875   126,918
 
Net income $ 473,090 $ 432,644
 
Basic and diluted earnings per share $ 0.39 $ 0.34
 
Cash dividends per share $ 0.00 $ 0.11
Weighted-average basic and diluted shares outstanding   1,205,128   1,270,128
                             

PINNACLE BANCSHARES, INC. AND SUBSIDIARY

 

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
Three Months Ended March 31, 2013 and 2012

 
Accumulated
Additional Other Total
Common Stock Paid-in Treasury Retained Comprehensive Stockholders’
Shares Par Value Capital Stock Earnings Income Equity
 
Balance, December 31, 2011 1,872,313 $ 18,723 $ 8,923,223 $ (7,320,909) $ 18,609,374 $ 2,103,992 $ 22,334,403
Net income - - - - 432,644 -

432,644

Cash dividends declared, $0.11 per share

- - - - 53,250 53,250
Other comprehensive income   -   -   -   -   (139,705)       (139,705)
Balance, March 31, 2012

1,872,313

18,723 8,923,223 (7,320,909) 18,902,313 2,157,242 22,680,592
 
Balance, December 31, 2012 1,872,313 $ 18,723 $ 8,923,223 $ (7,974,814) $ 19,894,190 $ 1,908,903 $ 22,770,225
Net income - - - - 473,090 - 473,090
Other comprehensive income   -   -   -   -   -   (165,948)   (165,948)
Balance, March 31, 2013   1,872,313 $ 18,723 $ 8,923,223 $ (7,974,814) $ 20,367,280 $ 1,742,955 $ 20,077,367
       

PINNACLE BANCSHARES, INC. AND SUBSIDIARY

 

CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended March 31, 2013 and 2012

 
2013 2012
OPERATING ACTIVITIES
Net income $ 473,090 $ 432,644
Adjustments to reconcile net income to net cash
Provided by operating activities:
Depreciation 120,750 104,867
Provision for loan losses 75,000 150,000
Net amortization and accretion of securities 106,252 29,603
Bank owned life insurance (86,413) (86,640)
Gain on sale of loans held for sale (21,473) (9,253)
Loss on sale and write down of Real Estate Owned (7,959) 0
Proceeds from sales of loans held for sale 417,274 (284,996)
Increase (decrease) in accrued interest receivable (13,308) 193,959
Increase (decrease) in accrued interest payable 3,169 (8,773)
Net other operating activities   (41,700)   (280,439)
Net cash provided by operating activities   1,024,682   240,972
INVESTING ACTIVITIES
Net loan repayments 1,649,974 (430,561)
Net increase in interest-bearing deposits in banks (4,737,071) (11,689,969)
Purchase of securities available for sale (3,880,000 (620,000)
Proceeds from maturing or callable securities available for sale 4,632,460 3,513,727
Purchase (redemption) of restricted equity securities 138,900 (1,900)
Purchase of premises and equipment

(11,935)

(157,562)
Proceeds from sales of other real estate owned   24,764   26,559
Net cash used in investing activities   (2,182,908)   (9,359,706)
 
FINANCING ACTIVITIES
Net increase in deposits 5,085,740 9,275,378
Payments on borrowings (3,800,000) 0
Increase (decrease) in repurchase agreements 90,054 (984,957)
Payments of cash dividends   0   (139,705)
Net cash provided by financing activities   1,375,794   8,150,716
 
Net decrease in cash and cash equivalents 217,568 (968,018)
 
Cash and cash equivalents at beginning of year   1,332,968   2,510,642
 
Cash and cash equivalents at end of year $ 1,550,536 $ 1,542,624
 
SUPPLEMENTAL DISCLOSURE

Cash paid (received) during the year for:

Interest $ 169,593 $ 248,444
Taxes $ 6,000 $ 60,000
OTHER NONCASH TRANSACTIONS
Other real estate owned acquired in settlement of loans $ 0 $ 166,688

Contact:
Pinnacle Bancshares, Inc.
Robert B. Nolen, Jr., 205-221-4111
President and Chief Executive Officer
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