Northway Financial (NASDAQ:NWFI)
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Northway Financial, Inc. Announces Second Quarter Results and
Declares Quarterly Dividend
BERLIN, N.H., July 26 /PRNewswire-FirstCall/ -- Northway Financial, Inc. (the
"Company") (NASDAQ:NWFI) reported net income for the quarter ended June 30,
2005 of $904,000, or $0.60 per share, compared to $748,000, or $0.50 per share,
for the same quarter in 2004, an increase of $156,000 or 21%. Net income for
the six months ended June 30, 2005 was $1,727,000, or $1.15 per share, compared
to $1,477,000, or $0.99 per share, for the six months ended June 30, 2004, an
increase of $250,000 or 17%.
Commenting on the second quarter results, William J. Woodward, President and
Chief Executive Officer of the Company stated:
"The second quarter results are encouraging. The 21% improvement in earnings
over the second quarter of 2004 continues the improvement achieved in the first
quarter of 2005. This earnings enhancement reflects our emphasis on increasing
the amounts of other noninterest income."
In addition, Mr. Woodward commented, "To improve service to our New Hampshire
customers, the Boards of Directors of the Berlin City Bank and The Pemigewasset
National Bank of Plymouth, NH voted to consolidate these two operating
subsidiaries of Northway Financial, Inc. effective October 1, 2005 under the
name Northway Bank. The regulatory approval process is underway. This
consolidation is the latest in a series of steps that have been taken over the
last several years to optimize the competitiveness of our Company. We believe
that this consolidation offers the customers of BCB and Pemi the convenience of
an expanded branch network, and through consolidated resources, the ability to
provide enhanced products and services. Northway Bank will be one of the
largest independent commercial community banks in New Hampshire."
The Company declared a quarterly dividend on July 26, 2005 of $0.18 per share
payable August 10, 2005 to shareholders of record on August 5, 2005.
Net interest and dividend income for the second quarter of 2005 was $5,674,000
compared to $5,698,000 for the second quarter of 2004, a decrease of $24,000.
There was no provision for loan losses for the second quarter of 2005, compared
to $120,000 for the second quarter of last year. The provision is established
based upon a review of the adequacy of the allowance for loan losses. This
review includes consideration of, among other factors, the Company's loan loss
experience and takes into consideration the Company's decision to terminate
indirect auto lending. At June 30, 2005 the allowance for loan losses was
1.14% of total loans, compared to 1.01% at June 30, 2004. Net securities gains
for the quarter decreased $163,000 to $98,000, compared to $261,000 for the
same period last year. Other noninterest income for the quarter increased
$194,000 to $1,197,000 compared to $1,003,000 for the same period last year.
Other operating expense was $5,752,000 for the quarter, compared to $5,702,000
for the same period last year, an increase of $50,000.
Net interest and dividend income for the six months ended June 30, 2005
increased $369,000 to $11,611,000, compared to $11,242,000 for the same period
last year. The provision for loan losses for the first six months of 2005
decreased $195,000 to $75,000, compared to $270,000 for the first six months of
2004. Securities gains for the first six months of 2005 decreased $551,000 to
$169,000, compared to $720,000 for the same period last year. Other noninterest
income year-to-date increased $273,000 to $2,113,000, compared to $1,840,000 for
the same period last year. Other operating expense increased $54,000 to
$11,364,000 for the first six months of 2005, compared to $11,310,000 for the
same period last year.
At June 30, 2005, Northway Financial had total assets of $629,225,000 compared
to $638,003,000 at June 30, 2004, a decrease of $8,778,000. Loans, including
loans held-for-sale, at June 30, 2005 decreased $34,585,000 to $459,933,000,
compared to June 30, 2004. Investments, including federal funds sold,
increased $27,161,000 to $114,520,000. Total deposits were $462,037,000 at June
30, 2005, a decrease of $11,621,000 compared to June 30, 2004. Total borrowings
decreased $932,000 to $112,807,000. Total stockholders' equity increased
$3,272,000 to $50,355,000.
Northway Financial, Inc., headquartered in Berlin, New Hampshire, is a
multi-bank holding company. Through its subsidiary banks, The Berlin City Bank
and The Pemigewasset National Bank of Plymouth, New Hampshire, the Company
offers a broad range of financial products and services to individuals,
businesses and the public sector from its full service banking offices.
Certain statements in this press release are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995.
Such forward-looking statements can be identified by the use of the words
"expect," "believe," "estimate," "will" and other expressions which predict or
indicate future trends and which do not relate to historical matters.
Forward-looking statements may include, but are not limited to, expectations
for impact of new products on noninterest income and expense, projections of
revenue, income or loss, and plans related to products or services of the
Company and its subsidiaries. Such forward-looking statements are subject to
known and unknown risks, uncertainties and contingencies, many of which are
beyond the control of the Company. The Company's actual results could differ
materially from those projected in the forward-looking statements as the result
of, among other factors, changes in interest rates, changes in the securities or
financial markets, a deterioration in general economic conditions on a national
basis or in the local markets in which the Company operates, including changes
in local business conditions resulting in rising unemployment and other
circumstances which adversely affect borrowers' ability to service and repay
our loans, changes in loan defaults and charge-off rates, reduction in deposit
levels necessitating increased borrowing to fund loans and investments, the
passing of adverse government regulation, and changes in assumptions used in
making such forward-looking statements. These forward- looking statements were
based on information, plans and estimates at the date of this press release, and
the Company does not promise to update any forward- looking statements to
reflect changes in underlying assumptions or factors, new information, future
events or other changes.
Northway Financial, Inc.
Selected Consolidated Financial Data
(Unaudited)
(In thousands, except for ratios and per share amounts)
Period end balance sheet data: June 30,
2005 2004
Total assets $629,225 $638,003
Loans, net (1) 459,933 494,518
Investments (2) 114,520 87,359
Deposits 462,037 473,658
Borrowings 112,807 113,739
Stockholders' equity 50,355 47,083
Book value per share $33.45 $31.40
Tangible book value per share (3) 24.89 22.12
Leverage ratio 9.04% 8.12%
Shares outstanding 1,505,574 1,499,574
For the Three Months For the Six Months
Ended June 30, Ended June 30,
Operating results: 2005 2004 2005 2004
Net interest and
dividend income $5,674 $5,698 $11,611 $11,242
Securities gains, net 98 261 169 720
Other noninterest
income 1,197 1,003 2,113 1,840
Loan loss provision - 120 75 270
Other operating expense 5,752 5,702 11,364 11,310
Income before tax 1,217 1,140 2,454 2,222
Income tax expense 313 392 727 745
Net income $904 $748 $1,727 $1,477
Earnings per share $0.60 $0.50 $1.15 $0.99
Return on average assets 0.59% 0.48% 0.56% 0.48%
Return on average equity 7.24% 6.24% 6.95% 6.15%
(1) Net of unearned income and the allowance for loan losses. Includes
loans held-for-sale.
(2) Includes federal funds sold, Federal Home Loan Bank stock, Federal
Reserve Bank stock and investment securities available-for-sale.
(3) Includes a deduction of $12,887 and $13,914 for goodwill, core deposit
intangible and mortgage servicing assets for 2005 and 2004,
respectively.
DATASOURCE: Northway Financial, Inc.
CONTACT: Richard P. Orsillo, Senior Vice President and Chief Financial
Officer of Northway Financial, Inc., +1-603-752-1171