Robert B. Nolen, Jr., President and Chief Executive Officer of
Pinnacle Bancshares, Inc. (OTCBB:PCLB), today announced Pinnacle’s
results of operations for the fourth quarter and year ended
December 31, 2012:
- For the three months ended December 31,
2012, Pinnacle reported net income of $506,000, compared to
$461,000 for the three months ended December 31, 2011.
- Net interest income before the
provision for loan losses for the three months ended December 31,
2012 was $1,803,000, compared with $1,896,000 in the same period
last year.
- For the year ended December 31, 2012,
net income was $1,955,000, compared with net income of $1,236,000
in the prior year.
- Net interest income before the
provision for loan losses for the year ended December 31, 2012, was
$7,374,000, compared with $7,817,000 in the prior year.
- For the three months ended December 31,
2012, basic and diluted earnings were each $0.42 per share. For the
same period in 2011, basic and diluted earnings were each $0.36 per
share.
- Basic and diluted earnings were each
$1.59 per share for the year ended December 31, 2012. For 2011,
basic and diluted earnings were each $0.97 per share.
Mr. Nolen commented: “Our strategy is to continue to provide
high quality products and services to, and practice relationship
banking with, our customers who live and conduct business in our
market area. We focus on loan quality which should enhance our
performance in a challenging environment. Although loan growth has
been limited, our core deposits and asset quality ratios have
remained strong, and we have conservatively managed our investment
portfolio, which we expect will provide significant flexibility if
loan volumes begin to increase.”
The Company’s net interest margin was 3.82% and 3.92% for the
three months and year ended December 31, 2012, respectively,
compared to 4.11% and 4.13% for the three months and year ended
December 31, 2011, respectively.
Other income remained stable. Fees and service charges declined
slightly from 2011 to 2012 as rule changes implemented from the
Dodd-Frank Act reduced certain fees Pinnacle charges. This was
offset by gain on sale of loans held for sale as home mortgage
production improved from 2011 to 2012.
Other expenses decreased $619,000 from 2011 to 2012. This was
due to a $211,000 reduction in compensation and benefits from staff
reduction, and a $136,000 reduction in net loss on sales of real
estate. In addition there was an approximately $240,000 reduction
in other expenses, primarily FDIC insurance, legal fees and
supplies.
At December 31, 2012, Pinnacle’s allowance for loan losses as a
percent of total loans was 2.07%, compared to 2.13% at December 31,
2011. At December 31, 2012, the allowance for loan losses as a
percent of nonperforming loans was 1018.00%, compared to 211.68% at
December 31, 2011. Based on current real estate valuations,
Pinnacle believes its allowance for loan losses is adequate.
Charge-offs, net of recoveries, were $393,000 in 2012, compared
to $1,315,000 in the prior year. Nonperforming assets were $548,000
at December 31, 2012, compared to $1,457,000 at December 31, 2011.
The ratio of nonperforming assets to total loans was .56% at
December 31, 2012, compared to 1.39% at December 31, 2011. “The
declining levels of charge-offs and non-performing assets reflect
our continued efforts to address and resolve problem loan issues
aggressively. These improvements allowed us to reduce the provision
for loan losses to $200,000 in 2012 compared to $1,100,000 in
2011,” said Mr. Nolen.
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.
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 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
December 31, 2012 2011 Net Income (loss) $
506,000 $ 461,000 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 $ 0.22 $ 0.11 Provision for loan
losses $ 50,000 $ 50,000 Basic earnings (loss) per share $ 0.42 $
.0.36 Diluted earnings (loss) per share $ 0.42 $ 0.36
Performance Ratios: (annualized) Return on average assets
0.99 % 0.90 % Return on average equity 8.80 % 8.34 % Interest rate
spread 3.81 % 4.10 % Net interest margin 3.82 % 4.11 % Operating
cost to assets 3.09 % 3.24 %
At December 31,
2012 2011 Net Income $ 1,955,000 $ 1,236,000
Weighted average basic shares outstanding 1,228,279 1,270,128
Weighted average diluted shares outstanding 1,228,279 1,270,128
Dividend per share $ 0.55 $ 0.44 Provision for loan losses $
200,000 $ 1,100,000 Basic earnings per share $ 1.59 $ 0.97 Diluted
earnings per share $ 1.59 $ 0.97
Performance Ratios: Return
on average assets 0.95 % 0.60 % Return on average equity 8.49 %
5.59 % Interest rate spread 3.90 % 4.12 % Net interest margin 3.92
% 4.13 % Operating cost to assets 2.98 % 3.28 %
At
December 31, 2012 2011 Total assets $
208,391,000 $ 199,231,000 Loans receivable, net $ 96,359,000 $
102,446,000 Deposits $ 177,313,000 $ 170,577,000
Total stockholders’ equity
$ 22,770,000 $ 22,334,000 Weighted average book value per share $
18.54 $ 17.58
Total stockholders’ equity to asset
ratio
10.93 % 11.21 %
Asset Quality Ratios: Nonperforming loans as
a percent of total loans .20 % 1.01 % Nonperforming assets as a
percent of total Loans .56 % 1.39 % Allowance for loan losses as a
percent of total loans 2.07 % 2.13
Allowance for loan losses as a percent of
nonperforming loans
1018.00 % 211.68 %
PINNACLE BANCSHARES, INC.AND
SUBSIDIARY
CONSOLIDATED STATEMENTS OF
CONDITIONDecember 31, 2012 and 2011
2012 2011
Assets
Cash and cash equivalents
$ 1,332,968 $ 2,510,642
Interest bearing deposits in banks
2,234,882 1,613,466
Securities available for sale
91,693,374 75,734,778
Restricted equity securities
994,800 957,800 Loans held for
sale
395,801 - Loans
97,998,866 104,674,158
Less allowance for loan losses
2,036,110
2,228,664 Loans, net
95,962,756
102,445,514
Other real estate owned
347,824 403,881
Premises and equipment, net
6,039,211 6,186,794 Goodwill
306,488 306,488 Bank owned life insurance
7,463,963
7,117,402 Accrued interest receivable
901,784 1,018,331
Other assets
716,917 935,476
Total assets $ 208,390,768 $
199,230,572
Liabilities and
Stockholders’ Equity
Deposits: Noninterest-bearing
$ 39,594,246 $
32,080,544 Interest-bearing
137,719,659
139,267,444 Total deposits
177,313,905 171,347,988
Repurchase agreements
118,793 984,957 Other
borrowings
3,800,000 - Subordinated debentures
3,093,000 3,093,000 Accrued interest payable
110,311
182,020 Other liabilities
1,184,534
1,288,204
Total liabilities 185,620,543
176,896,169 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
19,894,190 18,609,374 Accumulated other
comprehensive income, net of tax
1,908,903
2,103,992 Total stockholders’ equity
22,770,225 22,334,403 Total
liabilities and stockholders’ equity
$ 208,390,768
$ 199,230,572
PINNACLE BANCSHARES, INC.AND
SUBSIDIARY
CONSOLIDATED STATEMENTS OF
INCOMEYears Ended December 31, 2012 and 2011
2012 2011
Interest
income Loans, including fees
$ 5,716,220 $
6,555,597 Taxable securities
1,769,705 1,899,623 Nontaxable
securities
692,190 601,355 Other interest
35,247 36,875
Total interest income
8,213,362 9,093,450
Interest expense
Deposits
732,827 1,174,552 Borrowings and repurchase
agreements
2,635 2,097 Subordinated debentures
103,475 99,607
Total interest expense
838,937
1,276,256
Net interest income 7,374,425 7,817,194
Provision for loan losses 200,000
1,100,000
Net interest income after provision for loan
losses 7,174,425 6,717,194
Other
income Fees and service charges on deposit accounts
950,616 963,962 Servicing fee income, net
41,979
51,440 Bank owned life insurance
346,561 340,302 Net gain on
loans held for sale
86,254 40,061 Net gain on sales of other
real estate owned
21,240 - Net gain on sales of securities
available for sale
- 47,316
Total other
income 1,446,650 1,443,081
Other
expenses Salaries and employee benefits
2,870,620
3,081,447 Occupancy expenses
1,286,615 1,554,028 Marketing
and professional expenses
298,269 353,188 Net loss on sales
of other real estate owned
- 136,552 Other operating
expenses
1,641,149 1,590,515
Total other
expenses 6,096,653 6,715,730
Income before income taxes 2,524,422 1,444,545
Income tax expense 569,636 208,302
Net income $ 1,954,786 $ 1,236,243
Basic and diluted earnings per share $
1.59 $ 0.97
Cash dividends per share $
0.55 $ 0.44
Weighted-average basic and diluted shares
outstanding 1,228,279 1,270,128
PINNACLE BANCSHARES, INC.AND
SUBSIDIARY
CONSOLIDATED STATEMENTS OF
STOCKHOLDERS’ EQUITYYears Ended December 31, 2012 and
2011
Accumulated
Additional Other Total
Common Stock
Paid-in Treasury Retained Comprehensive
Stockholders’
Shares
Par Value Capital Stock Earnings
Income Equity Balance, December 31,
2010 1,872,313 $ 18,723 $ 8,923,223 $ (7,320,909 ) $ 17,931,987
$ 1,099,934 $ 20,652,958 Net income - - - - 1,236,243 - 1,236,243
Cash dividends declared, $0.44 per
share
- - - - (558,856 ) - (558,856 ) Other comprehensive income -
- - - - 1,004,057
1,004,057
Balance, December 31, 2011
1,872,313
18,723 8,923,223 (7,320,909 ) 18,609,374 2,103,991 22,334,402 Net
income - - - - 1,954,786 - 1,954,786
Cash dividends declared, $0.55 per
share
- - - - (669,970 ) - (669,970 ) Treasury stock purchase - - -
(653,905 ) - - (653,905 ) Other comprehensive income - -
- - - (195,089 )
(195,089 )
Balance, December 31, 2012 1,872,313 $ 18,723 $
8,923,223 $ (7,974,814 ) $ 19,894,190 $ 1,908,903 $
22,770,225
PINNACLE BANCSHARES, INC.AND
SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH
FLOWSYears Ended December 31, 2012 and 2011
2012 2011
OPERATING
ACTIVITIES Net income
$ 1,954,786 $ 1,236,243
Adjustments to reconcile net income to net cash Provided by
operating activities: Depreciation
481,321 484,254 Provision
for loan losses
200,000 1,100,000 Deferred tax expense
(benefit)
142,138 (86,761 ) Net amortization and accretion
of securities
274,185 2,578 Bank owned life insurance
(346,561 ) (340,302 ) Gain on sale of loans held for
sale
(86,254 ) (40,061 ) Gain on sale of securities
available for sale
- (47,316 ) (Gain) loss on sale or
write-down of other real estate owned, net
(21,240 )
136,552 Proceeds from sales of loans held for sale
(395,801
) 251,141 Decrease in accrued interest receivable
116,547 16,208 Decrease in accrued interest payable
(71,709 ) (171,544 ) Net other operating activities
574,379
(102,224
) Net cash provided by operating activities
2,821,791
2,438,768
INVESTING ACTIVITIES Net decrease in loans
5,192,805 9,184,171 Net (increase) decrease in
interest-bearing deposits in banks
(621,416 )
1,535,417 Purchase of securities available for sale
(30,795,326 ) (29,862,416 ) Proceeds from sales of
securities available for sale
- 4,011,875 Proceeds from
maturing or callable securities available for sale
14,247,883 14,920,077 Purchase (redemption) of restricted
equity securities
(37,000 ) 297,400 Purchase of
premises and equipment
(333,738 ) (206,339 ) Proceeds
from sales of other real estate owned
771,449
728,897 Net cash provided by investing activities
(11,575,343 ) 609,082
FINANCING ACTIVITIES Net decrease in deposits
5,965,917 (2,988,101 ) Increase in other borrowings
3,800,000 - Decrease in repurchase agreements
(866164
) (476,910 ) Purchase of treasury stock
(653,905
) - Payments of cash dividends
(669,970
) (558,856 ) Net cash used in financing activities
7,575,878 (4,023,867 ) Net
decrease in cash and cash equivalents
(1,177,674 )
(976,017 ) Cash and cash equivalents at beginning of year
2,510,642 3,486,659 Cash
and cash equivalents at end of year
$ 1,332,968
$ 2,510,642
SUPPLEMENTAL DISCLOSURE
Cash paid (received) during the year for: Interest
$
910,646 $ 1,447,800 Taxes
$ 488,717 $ (35,697
)
OTHER NONCASH TRANSACTIONS Other real estate owned
acquired in settlement of loans
$ 694,152 $ 705,632
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