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Pinnacle Bancshares Announces Results for Second Quarter Ended June 30, 2021

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JASPER, Ala., July 20, 2021--(BUSINESS WIRE)--Robert B. Nolen, Jr., President and Chief Executive Officer of Pinnacle Bancshares, Inc. (OTCBB: PCLB), today announced Pinnacle’s second quarter results of operations.

  • For the three months ended June 30, 2021, Pinnacle reported net income of $984,000 compared to $732,000 for the three months ended June 30, 2020. Paycheck Protection Program ("PPP") loan fees recognized during the three months ended June 30, 2021 were $50,000.

  • For the six months ended June 30, 2021, Pinnacle reported net income of $1,891,000 compared to $1,573,000 for the six months ended June 30, 2020. There were $153,000 of net gains related to sale of securities available for sale included in the six months ended June 30, 2020. PPP loan fees recognized during the six months ended June 30, 2021 were $191,000.

  • Net interest income for the three and six months ended June 30, 2021, was $2,463,000 and $4,842,000, respectively, compared with $2,095,000 and $4,117,000 respectively, in the same periods last year.

  • Basic and diluted earnings per share for the three and six months ended June 30, 2021 were $1.01 and $1.94 per share, respectively, compared to $0.74 and $1.57 per share, respectively, for the same periods last year.

  • For the three and six months ended June 30, 2021, return on average assets was 1.26%, and 1.25%, respectively, compared to 1.11% and 1.24%, respectively, in the comparable 2020 period.

Pinnacle’s net interest margin was 3.41% and 3.48% for the three and six months ended June 30, 2021, respectively, compared to 3.45% and 3.55% for the three and six months ended June 30, 2020, respectively.

At June 30, 2021, Pinnacle’s allowance for loan losses as a percent of total loans was 1.90%, compared to 2.13% at December 31, 2020. The allowance for loan losses as a percent of total loans, excluding PPP loans of approximately $10.5 million dollars, was 2.08% as of June 30, 2021. Nonperforming assets were $144,000 at June 30, 2021, compared to $130,000 at December 31, 2020. The ratio of nonperforming assets to total loans was .12% at both June 30, 2021 and December 31, 2020. All capital ratios are higher than the requirements for a well-capitalized institution.

Dividends of $.22 and $.44 were paid to shareholders during the three and six months ended for June 30, 2021, respectively as compared to $.19 and $.38 per share dividends that were paid to shareholders during the three and six months ended June 30, 2020.

As a result of the spread of the COVID-19 coronavirus, economic uncertainties have arisen which are likely to negatively impact the Company. The extent of COVID-19’s impact on the Company’s operational and financial performance will depend on certain developments, including the duration and spread of the outbreak, the virus’ impact on the Company’s customers, employees and vendors, and vaccination supply and delivery. At this point, the extent to which COVID-19 may impact the Company’s financial condition or results of operations remains uncertain.

Forward-Looking Statements

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

(In Thousands, except share and per share data)

Three Months Ended June 30,

2021

2020

Net income

$

984,000

$

732,000

Basic and diluted earnings per share

$

1.01

$

0.74

Performance ratios (annualized):

Return on average assets

1.26

%

1.11

%

Return on average equity

12.44

%

9.95

%

Interest rate spread

3.31

%

3.25

%

Net interest margin

3.41

%

3.45

%

Operating cost to assets

2.17

%

2.41

%

Weighted average basic and diluted shares outstanding

973,505

989,670

Dividends per share

$

0.22

$

0.19

Provision for loan losses

$

-

$

-

Six Months Ended June 30,

2021

2020

Net income

$

1,891,000

$

1,573,000

Basic and diluted earnings per share

$

1.94

$

1.57

Performance ratios (annualized):

Return on average assets

1.25

%

1.24

%

Return on average equity

12.09

%

10.67

%

Interest rate spread

3.38

%

3.33

%

Net interest margin

3.48

%

3.55

%

Operating cost to assets

2.24

%

2.51

%

Weighted average basic and diluted shares outstanding

973,505

1,004,529

Dividends per share

$

0.44

$

0.38

Provision for loan losses

$

-

$

-

(Audited)

June 30, 2021

December 31, 2020

Total assets

$

321,768,000

$

275,742,000

Loans receivable, net (includes $10.5M and $6.4M PPP loans, respectively)

$

120,912,000

$

109,429,000

Deposits

$

281,221,000

$

235,109,000

Brokered CD’s included in deposits

$

21,944,000

$

14,980,000

Total stockholders’ equity

$

34,345,000

$

34,332,000

Book value per share

$

35.28

$

34.63

Total average stockholders’ equity to assets ratio

10.37

%

11.15

%

Asset quality ratios:

Nonperforming loans as a percent of total loans

.12

%

.12

%

Nonperforming assets as a percent of total loans

.12

%

.12

%

Allowance for loan losses as a percent of total loans

1.90

%

2.13

%

Allowance for loan losses as a percent of nonperforming loans

1,625.69

%

1,833.08

%

FINANCIAL INFORMATION

PINNACLE BANCSHARES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(Unaudited)

(Audited)

June 30,

December 31,

2021

2020

Assets

Cash and cash equivalents

$

1,970,294

2,080,667

Interest bearing deposits in banks

13,669,405

4,106,661

Securities available for sale

163,944,535

139,688,995

Restricted equity securities

716,000

785,500

Loans

123,253,145

111,811,886

Less Allowance for loan losses

2,340,728

2,382,799

Loans, net

120,912,417

109,429,087

Premises and equipment, net

7,115,843

6,555,446

Right-of-use lease assets – operating

540,714

587,970

Goodwill

306,488

306,488

Bank owned life insurance

10,492,810

10,296,876

Accrued interest receivable

1,732,937

1,491,026

Other assets

366,151

413,613

Total assets

$

321,767,594

275,742,329

Liabilities and Stockholders’ Equity

Deposits

Noninterest-bearing

$

88,225,794

72,897,929

Interest-bearing

192,994,991

162,210,802

Total deposits

281,220,785

235,108,731

Subordinated debentures

3,093,000

3,093,000

Accrued interest payable

100,291

145,826

Operating lease liabilities

540,714

587,970

Other liabilities

2,467,389

2,474,936

Total liabilities

287,422,179

241,410,463

Stockholders’ equity

Common stock, par value $.01 per share; 2,400,000 authorized; 1,872,313 issued; 973,505 shares outstanding

18,723

18,723

Additional paid-in capital

8,923,223

8,923,223

Treasury stock (898,808 shares)

(13,441,345

)

(13,441,345

)

Retained earnings

36,336,441

34,874,072

Accumulated other comprehensive income, net of tax

2,508,373

3,957,193

Total stockholders’ equity

34,345,415

34,331,866

Total liabilities and stockholders’ equity

$

321,767,594

$

275,742,329

PINNACLE BANCSHARES, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Interest income

Loans, including fees

$

1,526,216

$

1,443,770

$

3,064,459

$

2,875,028

Securities available for sale

1,060,940

877,925

2,031,546

1,733,275

Other interest

5,420

6,545

11,052

25,677

Total interest income

2,592,576

2,328,240

5,107,057

4,633,980

Interest expense

Deposits

91,510

194,992

188,682

435,029

Borrowings and repurchase agreements

795

-

795

3,330

Subordinated debentures

37,550

38,210

76,050

78,310

Total interest expense

129,855

233,202

265,527

516,669

Net interest income

2,462,721

2,095,038

4,841,530

4,117,311

Provision for loan losses

-

-

-

-

Net interest income after provision for loan losses

2,462,721

2,095,038

4,841,530

4,117,311

Other income

Fees and service charges on deposit accounts

353,863

302,346

700,051

667,993

Service fee income, net

1,001

1,370

2,059

2,793

Bank owned life insurance

97,967

94,186

195,935

188,372

Mortgage fee income

14,987

13,568

17,474

25,574

Net gain on securities available for sale

-

-

-

152,658

Total other income

467,818

411,470

915,519

1,037,390

Other expense:

Salaries and employee benefits

965,842

934,378

1,924,815

1,874,920

Occupancy expense

212,163

216,278

434,307

417,983

Marketing and professional expense

67,527

68,815

132,164

128,061

Other operating expenses

445,711

377,090

878,612

766,330

Total other expenses

1,691,243

1,596,561

3,369,898

3,187,294

Income before income taxes

1,239,296

909,947

2,387,151

1,967,407

Income tax expense

255,536

177,943

496,439

394,792

Net income

$

983,760

$

732,004

$

1,890,712

$

1,572,615

Cash dividend per share

$

0.22

$

0.19

$

0.44

$

0.38

Basic and diluted earnings per share

$

1.01

$

0.74

$

1.94

$

1.57

Weighted –average basic and diluted shares outstanding

973,505

989,670

973,505

1,004,529

PINNACLE BANCSHARES, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Six Months Ended June 30, 2021 and 2020

Accumulated

Additional

Other

Total

Common Stock

Paid-in

Treasury

Retained

Comprehensive

Stockholders’

Shares

Amount

Capital

Stock

Earnings

Income

Equity

Balance December 31, 2019

1,872,313

$

18,723

$

8,923,223

$

(11,730,888

)

$

32,445,916

$

1,130,578

$

30,787,552

Net income

-

-

-

-

1,572,615

-

1,572,615

Cash dividends declared ($.38 per share)

-

-

-

-

(381,791

)

-

(381,791

)

Purchase of treasury stock

-

-

-

(1,337,258

)

-

-

(1,337,258

)

Other comprehensive income

-

-

-

-

-

1,686,621

1,686,621

Balance June 30, 2020

1,872,313

$

18,723

$

8,923,223

$

(13,068,146

)

$

33,636,740

$

2,817,199

$

32,327,739

Accumulated

Additional

Other

Total

Common Stock

Paid-in

Treasury

Retained

Comprehensive

Stockholders’

Shares

Amount

Capital

Stock

Earnings

Income

Equity

Balance December 31, 2020

1,872,313

$

18,723

$

8,923,223

$

(13,441,345

)

$

34,874,072

$

3,957,193

$

34,331,866

Net income

-

-

-

-

1,890,712

-

1,890,712

Cash dividends declared ($.44 per share)

-

-

-

-

(428,343

)

-

(428,343

)

Other comprehensive loss

-

-

-

-

-

(1,448,820

)

(1,448,820

)

Balance June 30, 2021

1,872,313

$

18,723

$

8,923,223

$

(13,441,345

)

$

36,336,441

$

2,508,373

$

34,345,415

PINNACLE BANCSHARES, INC,

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended

June 30,

2021

2020

OPERATING ACTIVITIES:

Net income

$

1,890,712

$

1,572,615

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation

214,258

194,494

Net investment amortization expense

161,957

135,870

Bank owned life insurance

(195,935

)

(188,372

)

Gain on sale of securities available for sale

-

(152,657

)

Increase in accrued interest receivable

(241,911

)

(263,083

)

Decrease in accrued interest payable

(45,535

)

(19,792

)

Net other operating activities

727,798

604,568

Net cash provided by operating activities

2,511,344

1,883,643

INVESTING ACTIVITIES:

Net increase in loans

(11,483,330

)

(22,815,467

)

Net increase in interest bearing deposits in other banks

(9,562,744

)

(4,036,821

)

Purchase of securities available for sale

(37,014,405

)

(21,737,575

)

Proceeds from sale of securities available for sale

-

2,732,970

Proceeds from maturing, sale and payments received on securities available for sale

10,460,206

6,973,469

Net redemption of restricted equity securities

69,500

34,000

Purchase of premises and equipment

(774,655

)

(186,138

)

Net cash used in investing activities

(48,305,428

)

(39,035,562

)

FINANCING ACTIVITIES:

Net increase in deposits

46,112,054

39,217,770

Purchase of treasury stock

-

(1,337,258

)

Payments of cash dividends

(428,343

)

(381,791

)

Net cash provided by financing activities

45,683,711

37,498,721

Net increase (decrease) in cash and cash equivalents

(110,373

)

346,802

Cash and cash equivalents at beginning of period

2,080,667

1,814,912

Cash and cash equivalents at end of period

$

1,970,294

$

2,162,714

SUPPLEMENTAL DISCLOSURES:

Cash paid during the period for:

Interest

$

311,062

$

536,461

Taxes

$

415,000

$

402,131

OTHER NONCASH TRANSACTIONS

Real estate acquired through foreclosure

$

-

$

-

Internally financed sales of other real estate owned

$

-

$

-

View source version on businesswire.com: https://www.businesswire.com/news/home/20210720005842/en/

Contacts

Joe B. Adams, III
Chief Financial Officer
(205) 221-8866