April 15, 2003
RECORD RESULTS REPORTED FOR LAKELAND FINANCIAL
Quarterly Dividend of $0.19 Per Share Announced
Warsaw, Indiana (April 15, 2003) - Lakeland Financial Corporation (Nasdaq/LKFN), parent company of Lake City Bank, today reported record quarterly net income of $3.5 million for the first quarter of 2003, an increase of 19% versus $3.0 million for the comparable period in 2002. Diluted net income per common share for the quarter was $0.59 versus $0.50 for the comparable period in 2002.
The Company also announced that the Board of Directors approved a cash dividend for the first quarter of $0.19 per share, payable on April 25, 2003 to shareholders of record on April 10, 2003. The quarterly dividend represents a 12% increase over the quarterly dividend of $0.17 paid in 2002.
Michael L. Kubacki, President and Chief Executive Officer, commented, "The Lake City Bank team delivered another strong performance in the quarter. We are proud to report stable growth throughout the income statement, led by a 31% increase in total noninterest income."
Kubacki continued, "Noninterest income increased to $4.4 million versus $3.3 million in the comparable period in 2002, driven by mortgage sales gains of $1.1 million, an increase of $718,000 versus the comparable period in 2002. The unprecedented volume of mortgage originations continued during the first quarter. While mortgage rates remain near historically low levels, we do not anticipate that this level of mortgage sales gains will continue throughout the year. Also adding to the strong increase in noninterest income was a 19% increase in service charges on deposit accounts which grew from $1.4 million to $1.7 million as a result of increases in both business and retail accounts."
"Net interest income after the provision for loan losses increased by 2% from $9.7 million in the first quarter of 2002 to $9.9 million for the first quarter of 2003. Net interest income performance was negatively impacted by a decline in the net interest margin from 4.12% in the first quarter of 2002 to 3.93% in the first quarter of 2003. We are pleased that the net interest margin improved from 3.77% in the fourth quarter of 2002, but expect margin pressures to continue due to overall lower asset yields and the generally lower interest rate environment," added Kubacki.
Average loans for the quarter ended March 31, 2003 were $830 million versus $746 million during the first quarter of 2002 and $801 million for fourth quarter of 2002. Total loans as of March 31, 2003 were $827 million versus $745 million as of March 31, 2002 and $823 million as of December 31, 2002. Lakeland Financial's allowance for loan losses as of March 31, 2003 was $9.7 million, or 1.18% of gross loans, compared to $8.3 million, or 1.12% of gross loans, as of March 31, 2002 and $9.5 million, or 1.16% of gross loans as of December 31, 2002. Non-performing assets totaled $8.8 million as of March 31, 2003 versus $3.4 million on March 31, 2002 and $7.7 million as of December 31, 2002. The increase resulted primarily from the addition of a single commercial loan. The ratio of non-performing assets to loans was 1.06% on March 31, 2003 compared to 0.46% on March 31, 2002 and 0.94% at December 31, 2002.
Kubacki commented, "Commercial loan demand slowed in the first quarter as our region continued to experience economic uncertainty. This reduction in demand, in conjunction with our adherence to diligent underwriting standards, led to relatively modest net loan growth in the quarter. Furthermore, we retained a conservative approach to our loan loss reserve by increasing the reserve during the quarter from $9.5 million to $9.7 million. Net charge offs totaled $458,000 in the quarter versus $139,000 in the first quarter of 2002 and $315,000 during the fourth quarter of 2002. We remain concerned with the overall weak economic conditions that have contributed to an increase in non-performing assets and believe we are taking appropriate actions to monitor and manage asset quality."
For the quarter ended March 31, 2003, Lakeland Financial's average equity to average assets ratio was 7.07% compared to 6.80% for the first quarter of 2002 and 6.88% for the fourth quarter of 2002. Average stockholders' equity in the quarter was $85.6 million versus $75.2 million for the comparable period in 2002 and $82.6 million for the fourth quarter of 2002. Average total deposits for the quarter ended March 31, 2003 were $934 million versus $817 million for the comparable period in 2002 and $916 million for the fourth quarter of 2002.
Lakeland Financial Corporation is a $1.2 billion bank holding company headquartered in Warsaw, Indiana. Lake City Bank serves Northern Indiana with 41 branches located in the following Indiana counties: Kosciusko, Elkhart, Allen, St. Joseph, DeKalb, Fulton, Huntington, LaGrange, Marshall, Noble, Pulaski and Whitley. A 42nd office is currently under construction in Warsaw and is expected to open in late 2003.
Lakeland Financial Corporation may be accessed on its home page at www.lakecitybank.com. The Company's common stock is traded on the Nasdaq Stock Market under "LKFN". Marketmakers in Lakeland Financial Corporation common shares include Stifel Nicolaus & Company, Howe Barnes Investments, Inc., Raymond James & Associates, Inc., McDonald Investments, Inc., First Tennessee Capital Markets and Trident Securities.
The Company's fixed rate cumulative trust preferred securities are traded on the Nasdaq Stock Market under the symbols "LKFNP". The annual rate on the fixed rate securities is 9.0%.
This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “intend,” “estimate,” “may,” “will,” “would,” “could,” “should” or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.
A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of the local and national economy; (ii) the economic impact of past and any future terrorist attacks, acts of war or threats thereof and the response of the United States to any such attacks and threats; (iii) changes in state and federal laws, regulations and governmental policies concerning the Company’s general business; (iv) changes in interest rates and prepayment rates of the Company’s assets; (v) increased competition in the financial services sector and the inability to attract new customers; (vi) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (vii) the loss of key executives or employees; (viii) changes in consumer spending; (ix) unexpected results of acquisitions; (x) unexpected outcomes of existing or new litigation involving the Company; and (xi) changes in accounting policies and practices. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission. |
