-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, V31Ipn06jVR/HyYJH+JM4Zyh5bTh3ngJyj5gZad+P1iCcRrcJGVnM0zJtdiG4Acp YG5chP/NGbBaKQIA2defoA== 0000894671-04-000122.txt : 20041014 0000894671-04-000122.hdr.sgml : 20041014 20041014133332 ACCESSION NUMBER: 0000894671-04-000122 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20040930 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041014 DATE AS OF CHANGE: 20041014 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OHIO VALLEY BANC CORP CENTRAL INDEX KEY: 0000894671 STANDARD INDUSTRIAL CLASSIFICATION: STATE COMMERCIAL BANKS [6022] IRS NUMBER: 311359191 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-20914 FILM NUMBER: 041078540 BUSINESS ADDRESS: STREET 1: 420 THIRD AVE CITY: GALLIPOLIS STATE: OH ZIP: 45631 BUSINESS PHONE: 6144462631 8-K 1 sec8k093004earningsrlscover.txt SEC8KCOVERLETTER093004 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 October 14, 2004 (October 14, 2004) Date of Report (Date of earliest event reported) OHIO VALLEY BANC CORP (Exact name of registrant as specified in its charter) Ohio (State or other jurisdiction of incorporation) 0-20914 31-1359191 (Commission file number) (IRS Employer Identification Number) 420 Third Avenue, Gallipolis, Ohio 45631 (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code: (740) 446-2631 Not Applicable (Former name or former address, if changed since last report.) Exhibit Index at Page 4. Item 7. Financial Statements and Exhibits - ----------------------------------------- (a) Not applicable (b) Not applicable (c) Exhibits: The following exhibit is included pursuant to Item 12. Results of Operations and Financial Condition: 99.1 Press Release dated October 14, 2004 of Ohio Valley Banc Corp. Item 12. Results of Operations and Financial Condition - ------------------------------------------------------ On October 14, 2004, Ohio Valley Banc Corp. issued a news release announcing its earnings for the third quarter and year to date periods ending September 30, 2004. The information contained in the news release, which is attached as Exhibit 99.1 to this Form 8-K, is incorporated herein by this reference. The information in this Current Report on Form 8-K, including Exhibit 99.1 included herewith, is being furnished and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liability of that section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933 or the Exchange Act, except as otherwise expressly stated in such filing. Page 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. OHIO VALLEY BANC CORP. Date: October 14, 2004 By /s/ Jeffrey E. Smith ------------------------------- Jeffrey E. Smith, President and Chief Executive Officer Page 3 EXHIBIT INDEX Exhibit Number Description 99.1 Press release of Ohio Valley Banc Corp dated October 14, 2004, announcing the company's earnings for the third quarter and year to date periods ending September 30, 2004. EX-99 2 sec8k093004earningsrelease.txt SEC8K093004 EXHIBIT 99.1 October 14, 2004 - For immediate release Contact: Scott Shockey, CFO or Bryna Butler, Corporate Communications 1-800-468-6682 or (740) 446-2631 Ohio Valley Banc Corp Continues Earnings Growth ----------------------------------------------- GALLIPOLIS, Ohio - Ohio Valley Banc Corp [Nasdaq: OVBC] reported consolidated net income for the quarter ended September 30, 2004, of $1,670,000 representing an increase of 5.0 percent over the same period in the prior year. Earnings per share for the third quarter of 2004 were $.48, up 4.3 percent from the $.46 earned the third quarter of 2003. For the nine months ended September 30, 2004, consolidated net income was $6,487,000, or $1.87 per share, compared to $4,622,000, or $1.33 per share, for the same nine month period a year ago. The year-to-date earnings include the previously disclosed sale of OVBC's investment in ProCentury Corp. [Nasdaq: PROS]. The second quarter sale resulted in an after-tax gain of $1,625,000 or $.47 per share. Excluding the sale of the ProCentury investment, operating earnings for the nine months ended September 30, 2004 were $4,862,000, up 5.2 percent compared to $4,622,000 a year ago. Operating earnings per share were $1.40 for the first nine months of 2004 versus $1.33 last year, an increase of 5.3 percent. On an operating basis, return on average assets and return on average equity were .90 percent and 11.92 percent for the first nine months of 2004, versus .89 percent and 11.95 percent for the prior year. The increase in operating earnings reflects the reduction in provision for loan loss expense which was driven by a decline in nonperforming loans and net loan charge-offs. The Company's ratio of nonperforming loans to total loans decreased to .45 percent at September 30, 2004, as compared to .96 percent at September 30, 2003 and the ratio of nonperforming assets to total assets decreased to .63 percent at September 30, 2004 from 1.18 percent the prior year. With improved asset quality in commercial and consumer loans, the Company's net charge-offs for the first nine months of 2004 were down $990,000 from the same time period the prior year. Based on the evaluation of the adequacy of the allowance for loan losses, management provided $1,612,000 to the allowance for loan losses for the nine months ended September 30, 2004, a decrease of $2,015,000 from the same time period the prior year. Management feels that the allowance for loan losses is adequate to absorb probable losses in the portfolio. The allowance for loan losses was 1.15 percent of total loans at September 30, 2004, as compared to 1.32 percent at September 30, 2003. For the nine months ended September 30, 2004, net interest income decreased $248,000 or 1.2 percent from last year. For the third quarter of 2004, net interest income decreased $20,000 from the prior year third quarter. The decline in net interest income was in relation to the net interest margin for the nine months ending September 30, 2004 decreasing to 4.10 percent from 4.33 percent for the same time period the prior year. The lower net interest margin was attributable to lower asset yields due to the Company's desire to shift from higher-yielding fixed rate assets to variable rate assets. Partially offsetting the impact in net interest margin compression was the growth in average earning assets. For the first nine months of 2004, average earning assets grew $26,902,000 or 4.1 percent from the same time period last year. Comparing sequential quarters, net interest income for the third quarter of 2004 was up $145,000 or 2.1 percent from the second quarter of 2004 as the net interest margin began to improve. Noninterest income totaled $6,486,000 for the nine months ended September 30, 2004, as compared to $4,458,000 for the same time period last year. For the three months ended September 30, 2004, noninterest income totaled $1,375,000 compared to $1,485,000 for 2003's third quarter. Included in the year-to-date increase in noninterest income was the pre-tax gain of $2,463,000 on the aforementioned sale of ProCentury. Gain on sale of loans for the first nine months of 2004 was down $404,000 from the same time period last year caused by a decline in the sales of secondary market real estate loans due to lower mortgage refinance volume and a shift to variable rate mortgage originations which management does not intend to sell. Offsetting a portion of this decline was a year-to-date increase in service charges on deposit accounts of $112,000 or 4.8 percent. On a year-to-date basis, noninterest expense totaled $15,879,000 in 2004, an increase of $765,000 or 5.1 percent compared to $15,114,000 the previous year. On a quarter-to-date basis, noninterest expense increased $194,000 or 3.8 percent from the third quarter in 2003. Salaries and employee benefits grew $684,000 or 7.9 percent for the first nine months of 2004, as compared to the same time period in 2003. The increase was related to annual merit increases, rising benefit costs and additional employees. With the renovation of the Milton office and upgrade in personal computers within various departments, furniture and equipment expense was up $174,000 on a year-to-date basis. The remaining noninterest expense categories were down $93,000 collectively from 2003. Total assets increased $22,719,000 from year end 2003 to reach $730,046,000 at September 30, 2004. Driving asset growth for 2004 was loan growth of $28,024,000, which equals an annual growth rate of 6.5 percent as compared to the 2.5 percent growth rate for all of 2003. Consumer loan growth of 8.3 percent and real estate loan growth of 5.2 percent were the primary contributors. Total deposits grew $32,192,000 from year end 2003 to fund loan growth and to reduce borrowed funds, which are down $16,513,000. The growth in deposits was primarily in certificates of deposit originated from local and national markets "I would like to thank our employees for their hard work and dedication in continuing the earnings momentum through the third quarter," stated Jeffrey E. Smith, President and CEO. "I continue to be pleased with the significant improvement in the Company's objective of enhanced asset quality. With the efforts to reduce nonperforming loans, our provision for loan losses was reduced to less than half of last year's amount." Ohio Valley Banc Corp common stock is traded on the NASDAQ Stock Market under the symbol OVBC. The holding company owns three subsidiaries: Ohio Valley Bank, with 16 offices in Ohio and West Virginia; Loan Central, with five consumer finance offices in Ohio, and Ohio Valley Financial Services, an insurance agency based in Jackson, Ohio. Learn more about Ohio Valley Banc Corp at www.ovbc.com. Non-GAAP Financial Measures In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures. OVBC believes that providing certain non-GAAP financial measures provides investors with information useful in understanding OVBC's financial performance. OVBC provides measures based on "operating earnings," which exclude significant non-recurring gains, losses or expenses that are not reflective of continuing operations. A reconciliation of these non-GAAP measures to the most comparable GAAP equivalent is included in the attached financial tables. Forward-Looking Information Certain statements contained in this earnings release which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "believes," "anticipates," "expects," "intends," "targeted" and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying those statements. Forward-looking statements involve risks and uncertainties. Actual results may differ materially from those predicted by the forward-looking statements because of various factors and possible events, including: (i) changes in political, economic or other factors such as inflation rates, recessionary or expansive trends, and taxes; (ii) competitive pressures; (iii) fluctuations in interest rates; (iv) the level of defaults and prepayment on loans made by the Company; (v) unanticipated litigation, claims, or assessments; (vi) fluctuations in the cost of obtaining funds to make loans; and (vii) regulatory changes. Forward-looking statements speak only as of the date on which they are made and Ohio Valley undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made to reflect unanticipated events. OHIO VALLEY BANC CORP - Non-GAAP Disclosure Reconciliation Operating earnings are net income adjusted to exclude the results of certain significant transactions not representative of continuing operations. The following reconciles GAAP net income and earnings per share to operating earnings and operating earnings per share for the quarter and nine months ended September 30, 2004 and 2003. Three months ended Nine months ended (in $000's, except per share data) September 30, September 30, 2004 2003 2004 2003 -------- -------- -------- -------- Net income $ 1,670 $ 1,590 $ 6,487 $ 4,622 Gain on sale of investment ---- ---- (2,463) ---- Tax effect ---- ---- 838 ---- After-tax non-operating items ---- ---- (1,625) ---- Operating earnings $ 1,670 $ 1,590 $ 4,862 $ 4,622 Earnings per share $ 0.48 $ 0.46 $ 1.87 $ 1.33 Gain on sale of investment ---- ---- (0.71) ---- Tax effect ---- ---- 0.24 ---- After-tax non-operating items ---- ---- (0.47) ---- Operating earnings per share $ 0.48 $ 0.46 $ 1.40 $ 1.33 OHIO VALLEY BANC CORP - Financial Highlights (Unaudited) Three months ended Nine months ended September 30, September 30, 2004 2003 2004 2003 ---------- ---------- ---------- ---------- PER SHARE DATA Operating earnings per share $0.48 $0.46 $1.40 $1.33 Earnings per share $0.48 $0.46 $1.87 $1.33 Dividend per share $0.19 $0.18 $0.56 $0.53 Book value per share $16.51 $15.19 $16.51 $15.19 Dividend payout ratio 39.37% 39.41% 30.00% 39.82% Weighted average shares outstanding 3,462,871 3,483,994 3,477,305 3,476,898 PERFORMANCE RATIOS Operating return on average equity 12.23% 11.96% 11.92% 11.95% Return on average equity 11.87% 11.96% 15.64% 11.95% Operating return on average assets 0.92% 0.91% 0.90% 0.89% Return on average assets 0.92% 0.91% 1.21% 0.89% Net interest margin 4.05% 4.28% 4.10% 4.33% Operating efficiency ratio 64.11% 60.69% 64.02% 59.18% Efficiency ratio 64.11% 60.69% 58.24% 59.18% Average earning assets (in 000's) $683,326 $649,616 $677,756 $650,854 OHIO VALLEY BANC CORP - Consolidated Statements of Income (Unaudited) Three months ended Nine months ended (in $000's) September 30, September 30, 2004 2003 2004 2003 --------- --------- --------- --------- Interest income: Interest and fees on loans $ 10,023 $ 10,280 $ 29,781 $ 31,518 Interest and dividends on securities 888 899 2,744 2,766 Total interest income 10,911 11,179 32,525 34,284 Interest expense: Deposits 2,825 2,951 8,379 9,441 Borrowings 1,194 1,316 3,584 4,033 Total interest expense 4,019 4,267 11,963 13,474 Net interest income 6,892 6,912 20,562 20,810 Provision for loan losses 471 996 1,612 3,627 Noninterest income: Service charges on deposit accounts 845 832 2,444 2,332 Trust fees 48 54 154 165 Income from bank owned insurance 148 172 458 516 Gain on sale of loans 21 84 31 435 Gain on sale of ProCentury Corp. ---- ---- 2,463 ---- Other 313 343 936 1,010 Total noninterest income 1,375 1,485 6,486 4,458 Noninterest expense: Salaries and employee benefits 3,185 2,938 9,305 8,621 Occupancy 311 331 962 980 Furniture and equipment 317 267 918 744 Data processing 183 177 543 475 Other 1,349 1,438 4,151 4,294 Total noninterest expense 5,345 5,151 15,879 15,114 Income before income taxes 2,451 2,250 9,557 6,527 Income taxes 781 660 3,070 1,905 NET INCOME $ 1,670 $ 1,590 $ 6,487 $ 4,622 OHIO VALLEY BANC CORP - Consolidated Balance Sheets (Unaudited) (in $000's, except share and per share data) September 30, December 31, 2004 2003 ---------------- ---------------- ASSETS Cash and noninterest-bearing deposits with banks $ 14,249 $ 17,753 Federal funds sold 5,075 ---- Total cash and cash equivalents 19,324 17,753 Interest-bearing deposits in other banks 526 859 Securities available-for-sale 70,401 76,352 Securities held-to-maturity (estimated fair value: 2004 - $13,609, 2003 - $13,547) 12,938 12,835 Total loans 601,728 573,704 Less: Allowance for loan losses (6,941) (7,593) Net loans 594,787 566,111 Premises and equipment, net 8,969 9,142 Accrued income receivable 2,769 2,700 Goodwill 1,267 1,267 Bank owned life insurance 13,593 13,222 Other assets 5,472 7,086 Total assets $ 730,046 $ 707,327 LIABILITIES Noninterest-bearing deposits $ 61,660 $ 62,235 Interest-bearing deposits 478,041 445,274 Total deposits 539,701 507,509 Securities sold under agreements to repurchase 25,026 24,018 Other borrowed funds 85,049 101,562 Subordinated debentures 13,500 13,500 Accrued liabilities 9,764 6,330 Total liabilities 673,040 652,919 SHAREHOLDERS' EQUITY Common stock ($1.00 stated value, 10,000,000 shares authorized; 2004 - 3,680,035 shares issued, 2003 - 3,658,212 shares issued) 3,680 3,658 Additional paid-in capital 31,626 30,962 Retained earnings 27,884 23,343 Accumulated other comprehensive income 88 624 Treasury stock at cost (2004 - 227,710 shares, 2003 - 159,611 shares) (6,272) (4,179) Total shareholders' equity 57,006 54,408 Total liabilities and shareholders' equity $ 730,046 $ 707,327 -----END PRIVACY-ENHANCED MESSAGE-----