Citizens Financial Services, Inc. Reports Fourth Quarter 2014 Earnings

MANSFIELD, Pa., Jan. 22, 2015 /PRNewswire/ -- Citizens Financial Services, Inc. (OTC BB: CZFS), parent company of First Citizens Community Bank, has released its unaudited financial performance has released its unaudited financial performance for the three months and year ended December 31, 2014.

For the three months ended December 31, 2014, net income totaled $3,476,000 which compares to net income of $3,297,000 for the fourth quarter of 2013. This represents an increase of $179,000, or 5.4% over the fourth quarter of 2013.  Basic earnings per share of $1.14 for the fourth quarter compares to $1.08 last year.  Annualized return on equity was 14.01% and 14.21% for the three months ended December 31, 2014 and 2013, while return on assets was 1.52% and 1.47%, respectively.

For the year ended December 31, 2014, net income totaled $13,385,000 which compares to $13,375,000 for last year. This represents an increase of $10,000, or .1%. Basic earnings per share increased from $4.38 per share last year to $4.41 per share this year, an increase of 1%.  Annualized return on equity for the comparable periods was 13.73% and 14.89%, while return on assets was 1.48% and 1.51%, respectively.

CEO and President Randall E. Black stated, "Despite managing multiple challenges throughout the year, including margin compression, sluggish loan demand, and ongoing and increasing regulatory burdens, we finished 2014 with our second highest net income on record.  I believe this represents exceptional financial performance, particularly compared to peer, and is the direct result of our commitment to outstanding customer service and dedication to serving our communities and customers".

Net interest income, before the provision for loan losses, increased 1.4% from $29,919,000 for the year ended December 31, 2013, to $30,338,000 for 2014.  While interest income for the year decreased $943,000, interest expense decreased $1,362,000 resulting in an overall increase in net interest income of $419,000 over the comparable period.  Partially impacting the comparison for interest income is the recognition in the third quarter of 2013 of $305,000 of interest income from a loan that paid off that was previously on non-accrual status.  The margin compressed slightly from 3.87% last year to 3.84% this year.  Yields on interest earning assets, on a tax-effected basis, declined from 4.62% last year to 4.42% this year.  As interest earning assets roll off or re-price, they are being replaced with lower yielding assets due to the continued low interest rate environment.

At December 31, 2014, total assets were $925 million, an increase of $10.1 million from total assets of $914.9 million at December 31, 2013.  The investment portfolio, including interest bearing time deposits, has decreased $7.7 million from year-end 2013, while net loans of $547.3 million as of the end of December have increased $13.8 million, or 2.6%.  In the fourth quarter alone, net loans have increased $10.4 million.  Loan quality remains strong and continues to improve from the end of last year.  At December 31, 2014, non-performing loans as a percent of total loans was 1.34%, which compares to 1.63% as of December 31, 2013.  Annualized net charge-offs to average loans remains low at .16%.

Stockholders' equity totaled $100.5 million at December 31, 2014, which compares to $92.1 million at December 31, 2013.  Net income of $13.4 million was offset by cash dividends of $6.6 million.  Also, accumulated other comprehensive income increased $2.0 million from the end of 2013, which represents the net change in the unrealized gain on available for sale investment securities and unrecognized pension costs.  The regular, quarterly cash dividend of $.40 per share was paid on December 22, 2014 to shareholders of record on December 15, 2014 and represents an increase of 3.9% over the quarterly cash dividend paid a year ago.  For the year, adjusted for stock dividends, the cash dividend was $2.17 per share compared to last year's cash dividend of $1.21 per share.  Dividends in 2014 include a one-time special dividend of $.60 per share paid in the third quarter.  "Our sustained outstanding financial performance and strong capital position has permitted us to increase our dividends and reflects the Board of Directors' desire to provide total shareholder return to our shareholder base.  We remain well-capitalized under regulatory capital guidelines, added Mr. Black".

Citizens Financial Services, Inc. has over 1,500 shareholders, the majority of whom reside in Potter, Tioga, and Bradford Counties, Pennsylvania and Allegany County, New York, where their 18 offices are located.

Note: This press release may contain forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various factors. These factors include operating, legal and regulatory risks; changing economic and competitive conditions and other risks and uncertainties.

SOURCE Citizens Financial Services, Inc.

Related Links

http://www.firstcitizensbank.com