JXVL Jacksonville Bancorp (MM)

Jacksonville Bancorp, Inc. Announces Earnings for Year Ended September 30, 2003 JACKSONVILLE, Texas, Nov. 13 /PRNewswire-FirstCall/ -- Jacksonville Bancorp, Inc. the holding company of Jacksonville Savings Bank, SSB, of Jacksonville, Texas, today reported net income of $5.8 million, or $3.16 diluted earnings per share, for the year ended September 30, 2003 compared to $6.0 million or $3.30 diluted earnings per share for the year ended September 30, 2002. The decrease in net income was due primarily to an increase in total noninterest expense, partially offset by increases in net interest income and total noninterest income. Jerry Chancellor, President and CEO stated, "The Bank experienced another very profitable year." He added that "earnings remained relatively stable as interest rates declined during the period." Total interest income declined by $1.4 million for the year ended September 30, 2003; however, this decline was more than offset by a decline in total interest expense of $2.1 million. Provision for losses on loans increased by $60,000 for the year. Net interest income after provision for losses on loans for the period increased by $678,000 to $14.8 million from $14.2 million for the year ended September 30, 2002. Total non-interest income for the year increased $484,000 to $3.1 million, from $2.6 million for the year ended September 30, 2002. This increase was primarily attributable to an increase in fees and deposit service charges of $367,000 and an increase in real estate operations, net of $137,000. The increase in non-interest income was partially offset by a $9,000 loss on the sale of investment securities and a decline of $11,000 in other non-interest income. Non-interest expenses increased by $1.5 million to $9.1 million for the year ended September 30, 2003, from $7.7 million for the prior year. Compensation and benefits increased by $1.2 million to $5.9 million from the prior period due primarily to a provision of $633,000 for retiree healthcare costs. Occupancy and equipment expense increased by $56,000 and insurance expense increased $19,000 from the prior year. For the year ended September 30, 2003, amortization of intangibles increased by $14,000 and other expenses which increased by $174,000. At September 30, 2003, assets totaled $472.2 million, liabilities totaled $428.6 million, and stockholders' equity amounted to $43.7 million. Jacksonville Bancorp, Inc. entered into an Agreement and Plan of Merger with Franklin Bank Corp., dated as of August 12, 2003, which provides for the acquisition of Jacksonville Bancorp by Franklin. The parties presently anticipate that the merger will be consummated during the quarter ending December 31, 2003. Jacksonville Bancorp has scheduled a special meeting of stockholders to be held on December 5, 2003 to consider and vote upon the merger agreement. If the merger is consummated, Jacksonville Bancorp does not anticipate holding its 2004 annual meeting. Jacksonville Bancorp, Inc.'s wholly-owned subsidiary, Jacksonville Savings Bank, SSB, operates from its headquarters in Jacksonville, Texas, and through its eight branch, East Texas office network in Tyler (2), Longview (2), Palestine, Athens, Rusk and Carthage. Additional financial data is available at http://www.sec.gov/ . JACKSONVILLE BANCORP, INC. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION SEPTEMBER 30, 2003 AND 2002 2003 2002 ASSETS Cash on hand and in banks $5,468,206 $3,957,183 Interest-bearing deposits 13,530,135 11,395,212 Investment securities: Held-to-maturity, approximate fair value of $2,587,410 and $8,115,888, respectively 2,515,447 8,005,603 Available-for-sale, carried at fair value 45,944,389 29,208,330 Mortgage-backed securities: Held-to-maturity, approximate fair value of $7,619,381 and $37,735,916, respectively 7,461,074 37,687,649 Available-for-sale, carried at fair value 99,817,919 52,037,400 Loans receivable, net 279,136,721 265,090,618 Accrued interest receivable 2,882,774 2,928,855 Foreclosed real estate, net 218,171 87,006 Premises and equipment, net 5,616,454 5,361,276 Stock in Federal Home Loan Bank of Dallas, at cost 3,254,000 3,168,100 Investment in real estate 1,041,320 1,211,730 Mortgage servicing rights 671,616 652,331 Goodwill and other intangibles, net 3,342,422 3,514,562 Other assets 1,331,175 944,536 Total assets $472,231,823 $425,250,391 LIABILITIES AND STOCKHOLDERS' EQUITY LIABILITIES Deposits $388,894,931 $353,896,248 Advances from Federal Home Loan Bank 31,107,711 25,129,010 Advances from borrowers for taxes and insurance 4,948,710 4,023,222 Accrued expenses and other liabilities 3,623,276 2,993,354 Total liabilities 428,574,628 386,041,834 STOCKHOLDERS' EQUITY Preferred stock, no par value, 5,000,000 shares authorized; none issued --- --- Common stock, $.01 par value, 25,000,000 shares authorized; 2,777,210 and 2,738,569 shares issued; 1,800,465 and 1,761,824 shares outstanding at 2003 and 2002, respectively 27,772 27,386 Additional paid-in capital 23,942,182 23,427,329 Retained earnings 37,056,978 32,310,194 Accumulated other comprehensive income (loss), unrealized gain (loss) on securities available for sale, net of tax (514,649) 376,658 Less: Treasury stock, at cost (976,745 shares) (16,015,455) (16,015,455) Shares acquired by Employee Stock Ownership Plan (839,633) (917,555) Total stockholders' equity 43,657,195 39,208,557 Total liabilities and stockholders' equity $472,231,823 $425,250,391 JACKSONVILLE BANCORP, INC. CONSOLIDATED STATEMENTS OF EARNINGS YEARS ENDED SEPTEMBER 30, 2003, 2002 AND 2001 2003 2002 2001 INTEREST INCOME Loans receivable $20,842,116 $21,728,116 $19,772,106 Mortgage-backed securities 3,570,788 4,519,882 2,734,813 Investment securities 2,070,816 1,528,161 1,257,104 Other 220,539 289,784 467,352 Total interest income 26,704,259 28,065,943 24,231,375 INTEREST EXPENSE Deposits 10,433,469 11,984,928 11,535,088 Interest on borrowings 1,277,025 1,825,706 2,506,155 Total interest expense 11,710,494 13,810,634 14,041,243 Net interest income 14,993,765 14,255,309 10,190,132 PROVISION FOR LOSSES ON LOANS 162,000 101,688 85,500 Net interest income after provision for losses on loans 14,831,765 14,153,621 10,104,632 NONINTEREST INCOME Fee and deposit service charges 2,695,992 2,329,149 1,949,946 Real estate operations, net 105,829 (31,333) 215,182 (Loss) gain on sale of securities (8,932) --- 42,411 Other 257,996 269,214 171,377 Total noninterest income 3,050,885 2,567,030 2,378,916 NONINTEREST EXPENSE Compensation and benefits 5,867,313 4,674,496 4,262,859 Occupancy and equipment 996,591 940,610 802,974 Amortization of intangibles 172,140 157,795 --- Insurance expense 130,209 111,680 96,532 Other 1,961,570 1,787,173 1,454,245 Total noninterest expense 9,127,823 7,671,754 6,616,610 INCOME BEFORE TAXES ON INCOME 8,754,827 9,048,897 5,866,938 TAXES ON INCOME Current 2,972,724 2,955,548 1,544,085 Deferred 1,809 117,680 446,000 Total income tax expense 2,974,533 3,073,228 1,990,085 Net earnings 5,780,294 5,975,669 3,876,853 EARNINGS PER COMMON SHARE Basic $3.38 $3.48 $2.18 Diluted $3.16 $3.30 $2.06 JACKSONVILLE BANCORP, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY YEARS ENDED SEPTEMBER 30, 2003, 2002 AND 2001 Additional Compre- Common Paid-in hensive Stock Capital Income Balance at September 30, 2000 $26,760 $22,742,784 Exercise of stock options (29,423 shares) 293 261,072 ESOP shares released --- 42,107 Accrual of management recognition plan awards --- --- Comprehensive income: Net earnings --- --- $3,876,853 Other comprehensive income, net of tax, unrealized gain on securities available-for-sale --- --- 1,302,167 Comprehensive income $5,179,020 Dividends declared --- --- Purchase of 161,300 Treasury shares --- --- Balance at September 30, 2001 27,053 23,045,963 Exercise of stock options (33,174 shares) 333 311,596 ESOP shares released --- 69,770 Accrual of management recognition plan awards --- --- Comprehensive income: Net earnings --- --- $5,975,669 Other comprehensive income, net of tax, unrealized (loss) on securities available-for-sale --- --- (24,657) Comprehensive income $5,951,012 Dividends declared --- --- Purchase of 107,185 Treasury shares --- --- Balance at September 30, 2002 $27,386 $23,427,329 Accumulated Other Comprehensive Income Retained Treasury (Loss) Earnings Stock Balance at September 30, 2000 $(900,852) $24,210,956 $(10,753,968) Exercise of stock options (29,423 shares) --- --- --- ESOP shares released --- --- --- Accrual of management recognition plan awards --- --- --- Comprehensive income: Net earnings --- 3,876,853 --- Other comprehensive income, net of tax, unrealized gain on securities available-for-sale 1,302,167 --- --- Comprehensive income Dividends declared --- (898,767) --- Purchase of 161,300 Treasury shares --- --- (2,921,652) Balance at September 30, 2001 401,315 27,189,042 (13,675,620) Exercise of stock options (33,174 shares) --- --- --- ESOP shares released --- --- --- Accrual of management recognition plan awards --- --- --- Comprehensive income: Net earnings --- 5,975,669 --- Other comprehensive income, net of tax, unrealized (loss) on securities available-for-sale (24,657) --- --- Comprehensive income Dividends declared --- (854,517) --- Purchase of 107,185 Treasury shares --- --- (2,339,835) Balance at September 30, 2002 $376,658 $32,310,194 $(16,015,455) Shares Shares Total Acquired Acquired Stockholders' by ESOP by MRP Equity Balance at September 30, 2000 $(1,055,546) $(181,067) $34,089,067 Exercise of stock options (29,423 shares) --- --- 261,365 ESOP shares released 66,179 --- 108,286 Accrual of management recognition plan awards --- 167,138 167,138 Comprehensive income: Net earnings --- --- 3,876,853 Other comprehensive income, net of tax, unrealized gain on securities available-for-sale --- --- 1,302,167 Comprehensive income Dividends declared --- --- (898,767) Purchase of 161,300 Treasury shares --- --- (2,921,652) Balance at September 30, 2001 (989,367) (13,929) 35,984,457 Exercise of stock options (33,174 shares) --- --- 311,929 ESOP shares released 71,812 --- 141,582 Accrual of management recognition plan awards --- 13,929 13,929 Comprehensive income: Net earnings --- --- 5,975,669 Other comprehensive income, net of tax, unrealized (loss) on securities available-for-sale --- --- (24,657) Comprehensive income Dividends declared --- --- (854,517) Purchase of 107,185 Treasury shares --- --- (2,339,835) Balance at September 30, 2002 $(917,555) $--- $39,208,557 Additional Compre- Common Paid-in hensive Stock Capital Income Balance at September 30, 2002 $27,386 $23,427,329 Exercise of stock options (38,641 shares) 386 404,733 ESOP shares released --- 110,120 Comprehensive income: Net earnings --- --- $5,780,294 Other comprehensive income, net of tax, unrealized (loss) on securities available-for-sale --- --- (891,307) Comprehensive income $4,888,987 Dividends declared --- --- Balance at September 30, 2003 $27,772 $23,942,182 Accumulated Other Comprehensive Income Retained Treasury (Loss) Earnings Stock Balance at September 30, 2002 $376,658 $32,310,194 $(16,015,455) Exercise of stock options (38,641 shares) --- --- --- ESOP shares released --- --- --- Comprehensive income: Net earnings --- 5,780,294 --- Other comprehensive income, net of tax, unrealized (loss) on securities available-for-sale (891,307) --- --- Comprehensive income Dividends declared --- (1,033,510) --- Balance at September 30, 2003 $(514,649) $37,056,978 $(16,015,455) Shares Shares Total Acquired Acquired Stockholders' by ESOP by MRP Equity Balance at September 30, 2002 $(917,555) $--- $39,208,557 Exercise of stock options (38,641 shares) --- --- 405,119 ESOP shares released 77,922 --- 188,042 Comprehensive income: Net earnings --- --- 5,780,294 Other comprehensive income, net of tax, unrealized (loss) on securities available-for-sale --- --- (891,307) Comprehensive income Dividends declared --- --- (1,033,510) Balance at September 30, 2003 $(839,633) $--- $43,657,195 JACKSONVILLE BANCORP, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS YEARS ENDED SEPTEMBER 30, 2003, 2002 AND 2001 2003 2002 2001 CASH FLOWS FROM OPERATING ACTIVITIES Net income $5,780,294 $5,975,669 $3,876,853 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 508,434 484,585 339,770 Amortization/accretion of securities 780,302 135,524 146,516 Amortization of intangibles 172,140 157,795 --- Provision for losses on loans 162,000 101,688 85,500 Loans originated for sale (40,165,598) (39,208,136) (20,932,788) Loans sold 40,165,598 39,208,136 20,932,788 Net loss (gain) on sale of securities 8,932 --- (42,316) Net gain on sale of real estate (213,582) (106,984) (346,095) Loss on disposal of assets 85,772 --- --- Accrual of MRP awards --- 13,929 167,138 Release of ESOP shares 188,042 141,582 108,286 Change in assets and liabilities: Decrease (increase) in other assets (137,429) 389,723 (1,177,451) Increase in accrued expenses and other liabilities 814,336 483,227 1,020,777 Decrease in deferred income (6,069) (15,729) (20,310) Increase (decrease) in mortgage servicing rights (19,285) (54,793) 27,967 Decrease (increase) in accrued interest receivable 46,081 (201,999) (203,107) Net cash provided by operating activities 8,169,968 7,504,217 3,983,528 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds on maturity of investment securities 31,936,460 33,560,977 18,373,775 Proceeds from sale of investment securities 10,000,000 --- 1,021,668 Proceeds from sale of premises and equipment --- 171,140 --- Purchase of investment securities (53,375,000) (52,030,000) (15,500,000) Net principal payments/originations on loans (14,551,210) (18,812,416) (19,444,687) Proceeds from sale of real estate 601,042 239,408 312,131 Purchase of mortgage-backed securities (91,253,505) (67,527,420) (46,965,170) Principal paydowns on mortgage- backed securities 71,784,102 36,515,434 22,051,666 Capital expenditures (849,384) (1,222,078) (276,063) Purchase of stock in FHLB Dallas (85,900) (554,900) (456,700) Premium on acquisition of Carthage branch --- (3,672,357) --- Investment in real estate (5,108) (153,352) (53,946) Net cash used in investing activities (45,798,503) (73,485,564) (40,937,326) CASH FLOWS FROM FINANCING ACTIVITIES Net increase in deposits 34,998,683 93,592,321 39,537,683 Increase (decrease) in advance payments by borrowers for property taxes and insurance 925,488 (36,410) (14,285) Advances from FHLB 15,550,000 31,000,000 43,000,000 Payment of FHLB advances (9,571,299) (53,978,764) (35,892,226) Proceeds from exercise of stock options 405,119 311,929 261,365 Purchase of Treasury stock --- (2,339,835) (2,921,652) Dividends paid (1,033,510) (854,517) (898,767) Net cash provided by financing activities 41,274,481 67,694,724 43,072,118 Net increase in cash and cash equivalents 3,645,946 1,713,377 6,118,320 CASH AND CASH EQUIVALENTS Beginning of year 15,352,395 13,639,018 7,520,698 End of year $18,998,341 $15,352,395 $13,639,018 DATASOURCE: Jacksonville Bancorp, Inc. CONTACT: Bill W. Taylor, Executive Vice President, C.F.O. of Jacksonville Bancorp, Inc., +1-903-586-9861

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