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CST: 18/11/2019 06:29:04   

Wayne Savings Bancshares, Inc. Announces Eighth Consecutive Quarter of Record Earnings

122 Days ago

WOOSTER, Ohio, July 18, 2019 (GLOBE NEWSWIRE) -- Wayne Savings Bancshares, Inc. (OTCQX: WAYN), (the “Company”), the holding company parent of Wayne Savings Community Bank, reported net income (unaudited) of $1,572,000 or $0.59 per common share for the quarter ended June 30, 2019, an increase of $368,000 or 31%, compared to $1,204,000 or $0.45 per common share for the quarter ended June 30, 2018. The increase in net income was due to an increase in net interest income and a decrease in non-interest expense partially offset with an increase in provision for federal income taxes.  The return on average equity and return on average assets for the second quarter of 2019 was 13.31% and 1.30%, respectively, compared to 11.40% and 1.05%, respectively, for the same period in 2018.

President and CEO James R. VanSickle commented, “We are delighted to report yet another quarter of record earnings for our shareholders.  Wayne Savings has been able to maintain the growth in commercial loans and improve operational efficiencies during the first half of 2019.  Our team of experienced bankers is committed to promoting meaningful growth in our communities.” 

Second Quarter 2019 Business Highlights

  • Net interest income was $4.1 million for the quarter ended June 30, 2019, an increase of $187,000, or 4.8%, compared to the quarter ended June 30, 2018.  The net interest margin decreased from 3.60% for the quarter ended June 30, 2018, to 3.56% for the comparable period of 2019.   The net interest margin decrease was the result of an increase of 28 basis points in the average cost of interest-bearing liabilities partially offset with an increase of 24 basis points in the average yield on interest-earning assets.
     
  • Provision for loan losses was $136,000 in the second quarter of 2019 compared to $218,000 for the period ending June 30, 2018.  This decrease in provision for loan losses expense was mainly due to additional specific reserves required during the June 30, 2018 quarter on loans evaluated for impairment.

  • Noninterest expense totaled $2.7 million for the three-month period ended June 30, 2019, a decrease of $154,000, or 5.4%, compared to the three months ended June 30, 2018, primarily due to reduced advertising and marketing expense, lower stockholder expense and reduced depreciation expense.  The Company’s efficiency ratio improved from June 2018 of 63.2% to 56.7% as of June 30, 2019. 

  • On June 28, 2019, the Company announced another dividend increase to $0.19 per share, payable July 31, 2019, to stockholders of record as of July 17, 2019.  This represents a 73% increase over the June 2018 dividend of $0.11 per share. 

The Company reported net income (unaudited) of $3.1 million or $1.17 per common share for the six months ended June 30, 2019, an increase of $970,000 or 44.7%, compared to $2.2 million or $0.81 per common share for the same period ended June 30, 2018. The increase in net income was due to an increase in net interest income, reduced provision for loan losses, an increase in non-interest income, a decrease in noninterest expenses partially offset with an increase in federal income tax expense.  The return on average equity and return on average assets for the six months ended June 30, 2019, was 13.53% and 1.31%, respectively, compared to 10.32% and 0.96%, respectively, for the same period in 2018.

2019 Year-to-Date Business Highlights

  • Net interest income was $8.1 million for the six-month period ended June 30, 2019, an increase of $458,000, or 6.0%, compared to the same period in 2018 as the six-month average net loan balances increased $31.0 million from the June 30, 2018 period.  Net interest margin for the six months ended June 30, 2019 and 2018, remained constant at 3.56% as the average cost of interest-bearing liabilities and the average yield on interest-earning assets both increased 27 basis points.

  • Net loan balances increased from $377.9 million at December 31, 2018, to $392.0 million, an increase of 3.7%, despite selling $6.4 million in mortgage loans through June 30, 2019, compared to $6.8 million during the 2018 year to date period.

  • Provision for loan losses was $220,000 for the six-month period ending June 30, 2019, compared to $338,000 for the prior year.  This reduction was to related specific reserve requirements remaining relatively unchanged during 2019 as compared to the required increase in 2018. 

  • Noninterest expense totaled $5.3 million for the six-month period ended June 30, 2019, a decrease of $547,000, or 9.4%, compared to the June 30, 2018 six-month period.  This decrease was primarily due to reduced stockholder expenses related to the proxy contest which was not repeated in 2019 and reduced advertising and marketing.  The Company’s efficiency ratio improved from 66.4% for the six-month period ended June 2018 to 56.4% for the same period in 2019. 

June 30, 2019 Financial Condition

At June 30, 2019, the Company had total assets of $488.9 million, an increase of $16.1 million, from total assets at December 31, 2018. The growth in total assets includes a $14.1 million increase in net loans compared to December 31, 2018, primarily due to an increase in commercial loans.  The asset growth was primarily funded with an increase in deposits of $18.5 million.

The allowance for loan losses increased from $3.4 million at December 31, 2018, to $3.6 million at June 30, 2019.  The allowance for loan losses and the related provision for loan losses is based on management’s judgment and evaluation of the loan portfolio.  Management believes the current allowance for loan losses is adequate, however, changing economic and other conditions may require future adjustments to the allowance for loan losses.

Total nonperforming loans increased from $1.8 million at December 31, 2018, to $2.0 million for the quarter ended June 30, 2019.  Past due loan balances of 30 days and more increased from $1.6 million at December 31, 2018, to $1.8 million at June 30, 2019.

Established in 1899, Wayne Savings Community Bank, the wholly owned subsidiary of Wayne Savings Bancshares, Inc., has eleven full-service banking locations in the communities of Wooster, Ashland, Millersburg, Rittman, Lodi, North Canton, and Creston, Ohio. The Bank also has a loan production office in Poland Ohio. Additional information about Wayne Savings Community Bank is available at www.waynesavings.com.

Forward-Looking-Statements
This release contains forward-looking statements that are not historical facts and that are intended to be
forward-looking statements as that term is defined by the Private Securities Litigation Reform Act of 1995.   These forward-looking statements may include, but are not limited to, statements about the Company s plans, objectives, expectations and intentions and other statements contained in this release that are not historical facts and pertain to the Company s future operating results.   When used in this release, the words expects, anticipates, intends, plans, believes, seeks, estimates and similar expressions are generally intended to identify forward-looking statements.   Actual results may differ materially from the results discussed in these forward-looking statements, because such statements are inherently subject to significant assumptions, risks and uncertainties, many of which are difficult to predict and are generally beyond the Company s control.   These include but are not limited to: the possibility of adverse economic developments that may, among other things, increase default and delinquency risks in the Company s loan portfolios; shifts in interest rates; shifts in the rate of inflation; shifts in the demand for the Company s loan and other products; unforeseen increases in costs and expenses; lower-than-expected revenue or cost savings in connection with acquisitions; changes in accounting policies; changes in the monetary and fiscal policies of the federal government; and changes in laws, regulations and the competitive environment.   Unless legally required, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Contact Information:
Myron Swartzentruber
Senior Vice President Chief Financial Officer
(330) 264-5767

 
 
WAYNE SAVINGS BANCSHARES, INC.
Selected Condensed Consolidated Financial Data
(Dollars in thousands, except per share data - unaudited)
                 
    June   March   December   September
    2019
  2019
  2018
  2018
                                 
Interest and dividend income   $ 4,981     $ 4,822     $ 4,737     $ 4,590  
Interest expense     899       815       734       640  
Net interest income     4,082       4,007       4,003       3,950  
Provision for loan losses     136       84       90       90  
Net interest income after provision for loan losses     3,946       3,923       3,913       3,860  
Non-interest income     663       567       524       611  
Non-interest expense     2,692       2,559       2,520       2,738  
Income before federal income taxes     1,917       1,931       1,917       1,733  
Provision for federal income taxes     345       364       356       315  
Net income   $ 1,572     $ 1,567     $ 1,561     $ 1,418  
                                 
Earnings per share - basic and diluted   $ 0.59     $ 0.58     $ 0.58     $ 0.53  
Dividends per share   $ 0.19     $ 0.17     $ 0.16     $ 0.15  
Return on average assets     1.30 %     1.32 %     1.34 %     1.22 %
Return on average equity     13.31 %     13.76 %     14.23 %     13.12 %
Shares outstanding     2,692,236       2,695,933       2,696,844       2,705,844  
Book value per share   $ 17.81     $ 17.17     $ 16.64     $ 15.98  
                                 
                                 
    June   March   December   September
    2018
  2018
  2017
  2017
                                 
Interest and dividend income   $ 4,436     $ 4,220     $ 4,202     $ 4,154  
Interest expense     541       484       482       491  
Net interest income     3,895       3,736       3,720       3,663  
Provision for loan losses     218       120       92       99  
Net interest income after provision for loan losses     3,677       3,616       3,628       3,564  
Non-interest income     609       493       470       548  
Non-interest expense     2,846       2,952       2,782       2,915  
Income before federal income taxes     1,440       1,157       1,316       1,197  
Provision for federal income taxes     236       192       394       342  
Net income   $ 1,204     $ 965     $ 922     $ 855  
                                 
Earnings per share - basic and diluted   $ 0.45     $ 0.36     $ 0.34     $ 0.31  
Dividends per share   $ 0.11     $ 0.11     $ 0.10     $ 0.09  
Return on average assets     1.05 %     0.86 %     0.81 %     0.77 %
Return on average equity     11.40 %     9.23 %     8.66 %     8.06 %
Shares outstanding     2,705,844       2,705,844       2,705,844       2,781,839  
Book value per share   $ 15.70     $ 15.39     $ 15.37     $ 15.31  
                                 
                                 

 

WAYNE SAVINGS BANCSHARES, INC.
Condensed Consolidated Statements of Income
(Dollars in thousands, except per share data - unaudited)
                       
  Three Months Ended       Six Months Ended    
  June 30,   Percentage   June 30,   Percentage
  2019   2018   change   2019   2018   change
                                   
Interest income $ 4,981   $ 4,436   12.3 %   $ 9,803   $ 8,656   13.3 %
Interest expense   899     541   66.2 %     1,714     1,025   67.2 %
Net interest income   4,082     3,895   4.8 %     8,089     7,631   6.0 %
Provision for loan losses   136     218   (37.6 )%     220     338   (34.9 )%
Net interest income after provision for loan losses   3,946     3,677   7.3 %     7,869     7,293   7.9 %
Non-interest income   663     609   8.9 %     1,230     1,102   11.6 %
Non-interest expense                                  
Salaries and employee benefits   1,523     1,523   0.0 %     2,977     3,069   (3.0 )%
Net occupancy and equipment expense   535     565   (5.3 )%     1,095     1,129   (3.0 )%
Franchise taxes   99     96   3.1 %     203     192   5.7 %
Advertising and marketing   51     119   (57.1 )%     94     217   (56.7 )%
Legal   8     16   (50.0 )%     24     89   (73.0 )%
Professional fees   56     40   40.0 %     80     79   1.3 %
Auditing and accounting   65     68   (4.4 )%     109     131   (16.8 )%
Stockholder expense   36     67   (46.3 )%     51     193   (73.6 )%
Other   319     352   (9.4 )%     618     699   (11.6 )%
Total non-interest expense   2,692     2,846   (5.4 )%     5,251     5,798   (9.4 )%
Income before federal income taxes   1,917     1,440   33.1 %     3,848     2,597   48.2 %
Provision for federal income taxes   345     236   46.2 %     709     428   65.7 %
Net income $ 1,572   $ 1,204   30.6 %   $ 3,139   $ 2,169   44.7 %
                                   
Earnings per share                                  
Basic and diluted $ 0.59   $ 0.45         $ 1.17   $ 0.81      
                                   
                                   

 

WAYNE SAVINGS BANCSHARES, INC.
Condensed Consolidated Balance Sheets
(Dollars in thousands, except per share data - unaudited)
 
  June 30, 2019   December 31, 2018
ASSETS              
               
Cash and cash equivalents $ 15,720     $ 11,161  
Securities, net (1)   55,411       58,705  
Loans held for sale   176       213  
Loans receivable, net   392,043       377,930  
Federal Home Loan Bank stock   4,226       4,226  
Premises & equipment, net   5,581       5,406  
Bank-owned life insurance   10,500       10,368  
Other assets   5,282       4,878  
TOTAL   ASSETS $ 488,939     $ 472,887  
               
LIABILITIES AND STOCKHOLDERS' EQUITY              
               
Deposit accounts $ 405,947     $ 387,449  
Other short-term borrowings   8,284       7,172  
Federal Home Loan Bank advances   23,000       28,500  
Accrued interest payable and other liabilities   3,756       4,888  
TOTAL LIABILITIES   440,987       428,009  
               
               
Common stock (3,978,731 shares of $.10 par value issued)   398       398  
Additional paid-in capital   36,183       36,152  
Retained earnings   30,326       28,290  
Shares acquired by ESOP   (112 )     (142 )
Treasury Stock, at cost - 1,286,495 shares and 1,281,887 shares              
at June 30, 2019 and December 31, 2018, respectively.   (18,638 )     (18,543 )
Accumulated other comprehensive loss   (205 )     (1,277 )
TOTAL STOCKHOLDERS' EQUITY   47,952       44,878  
               
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 488,939     $ 472,887  
               
(1)  Includes available-for-sale and held-to-maturity classifications.
Note: The December 31, 2018 Condensed Consolidated Balance Sheet has been derived from the audited Consolidated Balance Sheet as of that date.
       

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