Middlefield Banc Corp. Reports 19.15% Increase in First Quarter EPS to $0.56

Middlefield Banc Corp. 2003 Press Releases

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Contact Info: James R. Heslop, 2nd
Executive Vice President/Chief Operating Officer
440.632.1666 Ext. 3219
Date: April 15, 2003

MIDDLEFIELD, OHIO  Middlefield Banc Corp. (Pink Sheets: MBCN) reported consolidated net income for the first quarter of 2003 of $653,000. This represents an increase of 18.92% over the $549,000 recorded in the comparable quarter of 2002. First quarter 2003 earnings were $0.56 per diluted share, an increase of 19.15% from the $0.47 reported for 2002.

For the first quarter of 2003, returns on average common equity (ROE) and average assets (ROA) were 11.93% and 1.12%, respectively, compared to 11.01% and 1.09% for the prior year.

Commenting on the first quarter 2003 results, Thomas G. Caldwell, President and Chief Executive Officer, remarked, "The results of this quarter are reflective of our commitment to providing excellent service and products to our communities. It is gratifying to be able to report the positive increase in earnings as well as substantial asset growth."

"Our strong performance is particularly noteworthy in light of weakened economic conditions and historic low interest rates. These factors have worked to affect our asset quality and compress our net interest margin. However, we believe that we are well positioned to continue a positive return to our shareholders."

Net interest income on a fully tax equivalent basis was $2.136 million for the first quarter of 2003, which compares to $1.890 million for the first quarter of 2002. This increase of 13.04% was primarily attributable to a reduction in the cost of funding. For 2003, the net interest margin for the quarter was 3.94%, identical to that of the same quarter of 2002.

Noninterest income reflected moderate growth of 5.94% to $277,000. Noninterest expense for the period was $1.365 million, an increase over the year-ago three months of 8.41%. Staffing costs were up for 2003 as the subsidiary bank prepares to open a new banking office. Also contributing to the increase are costs associated with increased use of the bank’s Internet transactional banking site, www.middlefieldbank.com, as well as marketing expenses related to the introduction of a new corporate logo for both Middlefield Banc Corp. and its banking subsidiary.

"Our Chardon office has now completed eighteen months of operation and is beginning to show some profitability. We also have hired and trained staff for our new Orwell office. In light of this additional overhead, as well as our growing Internet banking, we are very pleased to report an improved efficiency ratio," commented Donald L. Stacy, Treasurer and Chief Financial Officer. "The fact that we have been able to show positive results in this area is evidence of our overall attention to costs within the organization."

Total assets as of March 31, 2003, were $240,086,224, which is an increase of 17.62% from March 31, 2002. Net loans were up 12.61% to $177,043,622, while deposits were $194,702,460, an increase of 13.85%. Shareholders’ equity at quarter end was $22,028,678, an increase of 9.64% from March 31, 2002.

First quarter loan loss provision was $105,000, representing an increase of 40.00% from the first quarter of 2002. Net loans charged off for the quarter were $16,000, or 0.04% of average loans outstanding on an annualized basis. The allowance stands at 1.33%. Non-performing loans were 0.38% of total loans.

Headquartered in Middlefield, Ohio, Middlefield Banc Corp. is a one-bank holding company for The Middlefield Banking Company. The Middlefield Banking Company operates five full service banking offices in Chardon, Garrettsville, Mantua and Middlefield, Ohio. A sixth office is scheduled to open in Orwell, Ashtabula County.

The information contained in this press release contains forward-looking statements regarding future performance which are not historical facts and which involve risk and uncertainties. Actual results and performance could differ materially from those contemplated by these forward looking statements.

Middlefield Banc Corp.

 

 

 

 

 

 

 

 

Selected Consolidated Financial Information

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended March 31,

 

 

 

2003

 

 

2002

 

% Change

Earnings (in 000s)

 

 

 

 

 

 

 

 

   Total interest income

 

$

3,588

 

$

3,426

 

4.72%

   Total interest expense

 

 

1,451

 

 

1,536

 

-5.54%

   Net interest income

 

 

2,136

 

 

1,890

 

13.04%

   Provision for loan losses

 

 

105

 

 

75

 

40.00%

   Net interest income after

 

 

 

 

 

 

 

 

      provision for loan losses

 

 

2,031

 

 

1,815

 

11.93%

   Total noninterest income

 

 

277

 

 

261

 

5.94%

   Total noninterest expense

 

 

1,365

 

 

1,259

 

8.41%

   Income before income taxes

 

 

943

 

 

817

 

15.40%

   Federal Income Taxes

 

 

290

 

 

268

 

8.18%

   Net income

 

 

653

 

 

549

 

18.92%

 

 

 

 

 

 

 

 

 

Per share (1)

 

 

 

 

 

 

 

 

   Earnings per common share - Basic

 

$

0.56

 

$

0.47

 

19.15%

   Earnings per common share - Diluted

 

 

0.56

 

 

0.47

 

19.15%

   Cash dividends paid

 

 

0.20

 

 

0.17

 

16.48%

   Book value (end of period)

 

 

19.06

 

 

17.34

 

9.92%

 

 

 

 

 

 

 

 

 

(1)  Per share data has been restated to reflect the five percent stock dividend paid in 2002.

 

 

 

 

 

 

 

 

 

Shares Outstanding

 

 

 

 

 

 

 

 

   Average - Basic

 

 

1,156,130

 

 

1,158,377

 

---

   Average - Diluted

 

 

1,158,478

 

 

1,159,491

 

---

   Actual (end of period)

 

 

1,155,853

 

 

1,158,721

 

---

 

 

 

 

 

 

 

 

 

 

 

 

For the Three Months Ended March 31,

 

 

 

2003

 

 

2002

 

% Change

Key performance ratios

 

 

 

 

 

 

 

 

   Return on average assets

 

 

1.12%

 

 

1.09%

 

2.75%

   Return on average equity

 

 

11.93%

 

 

11.01%

 

8.36%

   Net interest margin

 

 

3.94%

 

 

3.94%

 

0.00%

   Yield on earning assets

 

 

6.54%

 

 

7.24%

 

-9.67%

   Efficiency ratio

 

 

56.58%

 

 

58.54%

 

-3.35%

   Net charge-offs to average loans

 

 

 

 

 

 

 

 

      (actual for the period)

 

 

0.01%

 

 

0.03%

 

-66.67%

   Net charge-offs to average loans

 

 

 

 

 

 

 

 

      (annualized)

 

 

0.04%

 

 

0.11%

 

-63.64%

   Total allowance for loan losses

 

 

 

 

 

 

 

 

      to nonperforming loans

 

 

349.87%

 

 

566.28%

 

---

   Nonperforming loans to

 

 

 

 

 

 

 

 

      total loans

 

 

0.38%

 

 

0.23%

 

---

  Total allowance for loan losses

 

 

 

 

 

 

 

 

      to total loans

 

 

1.33%

 

 

1.32%

 

0.76%

   Equity to assets at period end

 

 

9.18%

 

 

9.84%

 

-6.71%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At period end (in 000s)

 

 

 

 

 

 

 

 

   Total assets

 

$

240,086

 

$

204,120

 

17.62%

   Total deposits

 

 

194,702

 

 

171,016

 

13.85%

   Net loans receivable

 

 

177,044

 

 

157,213

 

12.61%

   Securities

 

 

42,839

 

 

31,380

 

36.52%

   Shareholders equity

 

 

22,029

 

 

20,092

 

9.64%

 

 

 

 

 

 

 

 

 

Middlefield Banc Corp.

 

 

 

 

 

 

 

 

Supplemental Detail

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31,

 

 

 

 

 

2003

 

 

2002

 

 

BALANCE SHEET  (in 000s)

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   Cash and due from banks

 

$

5,983

 

$

4,966

 

 

   Federal funds sold

 

 

0

 

 

1,480

 

 

   Securities available for sale

 

 

38,050

 

 

22,668

 

 

   Held to maturity securities

 

 

4,788

 

 

8,712

 

 

         Total cash and securities

 

 

48,822

 

 

37,826

 

 

   Loans held for investment

 

 

179,433

 

 

159,308

 

 

   Loans held for sale

 

 

0

 

 

0

 

 

      Total loans

 

 

179,433

 

 

159,308

 

 

   Reserve for losses on loans

 

 

2,390

 

 

2,095

 

 

   Intangibles

 

 

0

 

 

0

 

 

   Other real estate owned

 

 

2

 

 

0

 

 

   Premises and equipment

 

 

6,720

 

 

6,375

 

 

   Other assets

 

 

7,499

 

 

2,707

 

 

      TOTAL ASSETS

 

$

240,086

 

$

204,120

 

 

 

 

 

 

 

 

 

 

 

 

 

As of March 31,

 

 

 

 

 

2003

 

 

2002

 

 

LIABILITIES

 

 

 

 

 

 

 

 

   Deposits

 

$

194,702

 

$

171,016

 

 

   Federal funds purchased

 

 

1,600

 

 

0

 

 

   Borrowed funds

 

 

20,972

 

 

11,904

 

 

   Other liabilities

 

 

783

 

 

1,108

 

 

      TOTAL LIABILITIES

 

$

218,058

 

$

184,028

 

 

 

 

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

 

 

 

   Common equity

 

$

23,417

 

$

21,494

 

 

   Net unrealized gain

 

 

 

 

 

 

 

 

      (loss) on securities

 

 

357

 

 

75

 

 

   Treasury stock

 

 

(1,745)

 

 

(1,476)

 

 

      TOTAL EQUITY

 

$

22,029

 

$

20,092

 

 

 

 

 

 

 

 

 

 

 

      TOTAL LIABILITIES & EQUITY

$

240,086

 

$

204,120

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME STATEMENT

 

 

 

 

 

 

 

 

 

 

 

For the Three Months

 

 

 

 

 

Ended March 31,

 

 

 

 

 

2003

 

 

2002

 

 

   Employee compensation and

 

 

 

 

 

 

 

 

      benefits expense

 

$

646

 

$

579

 

 

   Occupancy and equipment expense

 

 

179

 

 

170

 

 

   Other general, administrative and

 

 

 

 

 

 

 

 

      other expense

 

 

540

 

 

510

 

 

   Total noninterest expense

 

$

1,365

 

$

1,259

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHARGE-OFFS

 

 

 

 

 

 

 

 

 

 

 

For the Three Months

 

 

 

 

 

Ended March 31,

 

 

 

 

 

2003

 

 

2002

 

 

   Loan charge-offs

 

$

18

 

$

72

 

 

   Recoveries on loans

 

 

2

 

 

30

 

 

   Net loan charge-offs

 

 

16

 

 

42