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Citizens Holding Company Reports Earnings



  Citizens Holding Company Reports Earnings

Business Wire

PHILADELPHIA, Miss. -- October 23, 2012

Citizens Holding Company (NASDAQ:CIZN) announced today results of operations
for the three and nine months ended September 30, 2012.

Net income for the three months ended September 30, 2012 was $1.629 million or
$0.34 per share-basic and $0.33 per share-diluted, up from $1.623 million, or
$0.33 per share-basic and diluted for the same quarter in 2011. Net interest
income for the third quarter of 2012, after the provision for loan losses for
the quarter, was $6.416 million, approximately 3.9% higher than the same
period in 2011, due to a decrease in the provision for loan losses offset
partially by a decrease in net interest income. The provision for loan losses
for the three months ended September 30, 2012 was $463 thousand compared to
$1.660 million for the same period in 2011. The decrease in the provision
reflects management’s estimate of inherent losses in the loan portfolio
including the impact of current local and national economic conditions. The
net interest margin decreased to 3.74% in the third quarter of 2012 from 4.31%
in the same period in 2011 primarily because of the decrease in yields on
earning assets was offset by the decline in rates paid on interest bearing
deposits.

Non-interest income decreased in the third quarter of 2012 by $608 thousand,
or 24.8%, while non-interest expenses decreased $427 thousand, or 6.4%,
compared to the same period in 2011. The decrease in non-interest income was
due primarily to a decrease in income from the gains on sales of investment
securities. Non-interest expenses decreased primarily due to a $390 thousand
decrease in other operating expense, a $104 thousand decrease in salaries and
benefits and a $67 thousand increase in occupancy expense.

Net income for the nine months ended September 30, 2012 decreased 7.1% to
$5.044 million, or $1.04 per share-basic and diluted, from $5.432 million, or
$1.12 per share-basic and diluted, for the nine months ended September 30,
2011. Net interest income for the nine months ended September 30, 2012, after
the provision for loan losses, decreased 0.5% to $20.484 million from $20.586
million for the same period in 2011. Net interest margin for the nine months
ended September 30, 2012, decreased to 4.00% in 2012 from 4.28% in the same
period in 2011. The provision for loan losses for the nine months ended
September 30, 2012 was $1.328 million compared to the provision of $2.586
million in 2011. The decrease in the provision reflects management’s
assessment of inherent losses in the loan portfolio including the impact
caused by current local and national economic conditions.

Non-interest income increased by $461 thousand, or 8.3%, and non-interest
expense increased by $11 thousand, or 0.1%, for the nine months ended
September 30, 2012 when compared to the same period in 2011. The decrease in
non-interest income was primarily due to a decrease in the gain of sales of
investment securities. Non-interest expense increased primarily due an
increase in other operating expenses of $37 thousand and occupancy expenses in
the amount of $88 thousand partially offset by a decrease in salaries and
benefits in the amount of $114 thousand.

Total assets as of September 30, 2012 decreased to $847.897 million, down
$6.048 million, or 0.7%, when compared to December 31, 2011. Deposits
increased by $44.684 million, or 7.8%, and loans, net of unearned income
decreased by $11.062 million, or 2.8%, when compared to December 31, 2011. The
decrease in loans, net of unearned, was due to declining loan demand and
repayments of existing loans. Non-performing assets increased by $3.160
million to $19.597 million at September 30, 2012 as compared to December 31,
2011, because of increases in non-accrual loans and other real estate owned
partially offset by a decrease in loans 90 days or more past due and still
accruing interest.

During the first nine months of 2012, the Company paid dividends totaling
$0.66 per share.

Citizens Holding Company (the “Company”) is a one-bank holding company and the
parent company of The Citizens Bank of Philadelphia (the “Bank”), both
headquartered in Philadelphia, Mississippi. The Bank currently has twenty-two
banking locations in ten counties in East Central and South Mississippi and
has a loan production office in Biloxi, Mississippi. In addition to full
service commercial banking, the Bank offers mortgage loans, title insurance
services through its subsidiary, Title Services, LLC, and a full range of
Internet banking services including online banking, bill pay and cash
management services for businesses. Internet services are available at the
Bank’s web site, www.thecitizensbankphila.com. Citizens Holding Company stock
is listed on the NASDAQ Global Market and is traded under the symbol CIZN. The
Company’s transfer agent is American Stock Transfer & Trust Company.
Information about Citizens Holding Company may be obtained by accessing its
corporate website at www.citizensholdingcompany.com.

This press release includes “forward-looking statements” within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements other than statements of historical facts
included in this release regarding the Company’s financial position, results
of operations, business strategies, plans, objectives and expectations for
future operations, are forward looking statements. The Company can give no
assurances that the assumptions upon which such forward-looking statements are
based will prove to have been correct. Forward-looking statements speak only
as of the date they are made. The Company does not undertake a duty to update
forward-looking statements to reflect circumstances or events that occur after
the date the forward-looking statements are made. Such forward-looking
statements are subject to certain risks, uncertainties and assumptions. The
risks and uncertainties that may affect the operation, performance,
development and results of the Company’s and the Bank’s business include, but
are not limited to, the following: (a) the risk of adverse changes in business
conditions in the banking industry generally and in the specific markets in
which the Company operates; (b) changes in the legislative and regulatory
environment that negatively impact the Company and Bank through increased
operating expenses; (c) increased competition from other financial
institutions; (d) the impact of technological advances; (e) expectations about
the movement of interest rates, including actions that may be taken by the
Federal Reserve Board in response to changing economic conditions; (f) changes
in asset quality and loan demand; (g) expectations about overall economic
strength and the performance of the economics in the Company’s market area;
and (h) other risks detailed from time to time in the Company’s filings with
the Securities and Exchange Commission. Should one or more of these risks
materialize, or should any such underlying assumptions prove to be
significantly different, actual results may vary significantly from those
anticipated, estimated, projected or expected.

                                                    
Citizens Holding Company

Financial Highlights

(amounts in thousands, except share and per share data)
                                                      
                         Three Months                Nine Months
                         Ending September 30,        Ending September 30,
                         2012          2011          2012           2011
                                                                   
Interest income and      $8,276        $9,423        $26,178        $28,212
fees
Interest expense         1,397         1,590         4,365          5,039
Net interest income      6,879         7,833         21,813         23,173
                                                                     
                                                                     
Provision for loan       462           1,660         1,328          2,587
losses
Net interest income
after provision for      6,417         6,173         20,485         20,586
loan losses
                                                                     
Non-interest income      1,840         2,448         5,087          5,548
Non-interest expense     6,273         6,700         19,357         19,346
                                                                     
Net income before        1,984         1,921         6,215          6,788
taxes
Income taxes             355           298           1,171          1,356
                                                                     
Net income               $1,629        $1,623        $5,044         $5,432
                                                                     
                                                                     
Earnings per share -     $0.34         $0.33         $1.04          $1.12
basic
                                                                     
Earnings per share -     $0.33         $0.33         $1.04          $1.12
diluted
                                                                     
Average shares           4,861,411     4,838,411     4,856,584      4,841,829
outstanding-basic
                                                                     
Average shares           4,867,039     4,851,044     4,865,077      4,849,512
outstanding-diluted
                                                                     
                                                                     
                                                     As of          As of
                                                     September      December
                                                     30,            31,
                                                     2012           2011
Period End Balance
Sheet Data:
Total assets                                         $847,897       $853,945
Total earning assets                                 778,526        760,744
Loans, net of                                        378,200        389,262
unearned income
Allowance for loan                                   7,449          6,681
losses
Total deposits                                       617,022        572,338
Long-term borrowings                                 68,692         68,677
Shareholders' equity                                 88,401         86,079
Book value per share                                 $18.18         $17.77
Dividends paid per                                   $0.66          $0.88
share
                                                                     
Period End Average
Balance Sheet Data:
Total assets                                         $839,212       $829,177
Total earning assets                                 770,243        753,042
Loans, net of                                        384,999        407,748
unearned income
Total deposits                                       584,774        543,711
Long-term borrowings                                 73,852         82,576
Shareholders' equity                                 87,582         82,254
                                                                     
Period End
Non-performing
Assets:
Non-accrual loans                                    14,500         11,299
Loans 90+ days past                                  92             269
due and accruing
Other real estate                                    5,005          4,869
owned
                                                                     
Period End Net
charge-offs as a                                     0.15%          0.66%
percentage of
average net loans
                                                                     
Period End
Performance Ratios:
Return on average                                    0.80%          0.87%
assets^(1)
Return on average                                    7.62%          8.78%
equity^(1)
                                                                     
Period Ending Net
Interest
Margin (tax                                          4.00%          4.20%
equivalent)^(1)
                                                                     
^(1) Annualized

Contact:

Citizens Holding Company, Philadelphia
Robert T. Smith, 601-656-4692
rsmith@tcbphila.com
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