Oak Ridge Financial Services, Inc. (NASDAQ CM: BKOR), the holding company for Bank of Oak Ridge, today reported first quarter 2009 net income of $100,000, compared with net income of $61,000 for the same period in 2008. First quarter 2009 loss available to common stockholders was $8,000, compared to income available to common stockholders of $61,000 for the same period in 2008. First quarter 2009 diluted earnings per share were $0.00, compared to diluted earnings per share of $0.03 for the same period in 2008.
Oak Ridge Financial Services President, Ron Black, in commenting on the results, noted, “Given the difficult economic environment, we are pleased with our profitability in the first quarter of 2009. During the first quarter our primary focus was servicing our loan portfolio, and although our level of nonperforming assets increased from December 2008, we believe that our efforts will pay off in subsequent quarters. Our primary areas of focus for the rest of 2009 will be continuing to service our loan portfolio and growing net interest income and noninterest income by providing extraordinary service to existing and prospective clients. We plan to continue to support our local economy by taking deposits, making loans, and providing financial advice for our clients in these difficult times. The community was incredibly supportive of our Bank in the first quarter and we had significant increases in loans, deposits and noninterest income. Lastly, at March 31, 2009 we were well-capitalized with ample capital for future growth. ”
About Bank of Oak Ridge
Bank of Oak Ridge, headquartered in Oak Ridge, NC, is a community Bank with five locations in Oak Ridge, Summerfield and Greensboro. The Bank offers a complete line of banking and investment services, including savings and checking accounts, mortgage and business loans, extended weekday and Saturday branch banking hours, same-day deposits, cash management services, business and personal internet banking with balance alerts and reminders, internet bill payment, mobile banking and accounts designed specifically for seniors, small businesses and civic organizations. For more information, contact Bank of Oak Ridge at 336-644-9944, or visit www.bankofoakridge.com.
Forward-looking Information
This form contains certain forward-looking statements with respect to the financial condition, results of operations and business of the Company. These forward-looking statements involve risks and uncertainties and are based on the beliefs and assumptions of management of the Company and on the information available to management at the time that these disclosures were prepared. These statements can be identified by the use of words like “expect,” “anticipate,” “estimate” and “believe,” variations of these words and other similar expressions.Readers should not place undue reliance on forward-looking statements as a number of important factors could cause actual results to differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, (1) competition in the Company’s markets, (2) changes in the interest rate environment, (3) general national, regional or local economic conditions may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and the possible impairment of collectibility of loans, (4) legislative or regulatory changes, including changes in accounting standards, (5) significant changes in the federal and state legal and regulatory environment and tax laws, (6) the impact of changes in monetary and fiscal policies, laws, rules and regulations and (7) other risks and factors identified in the Company’s other filings with the Federal Deposit Insurance Corporation. The Company undertakes no obligation to update any forward-looking statements.
| Oak Ridge Financial Services, Inc. | |||||||||||
| Financial Highlights (dollars in thousands, except share and per share data) | |||||||||||
| Three months ended March 31, | |||||||||||
| 2009 | 2008 | Change | |||||||||
| Income Statement Data: | |||||||||||
| Total interest income | $ | 4,696 | $ | 4,453 | 5.5 | % | |||||
| Total interest expense | 2,229 | 2,538 | (12.2 | ) | |||||||
| Net interest income | 2,467 | 1,915 | 28.8 | ||||||||
| Provision for loan losses | 366 | 164 | 123.2 | ||||||||
| Non-interest income | 828 | 754 | 9.8 | ||||||||
| Non-interest expense | 2,775 | 2,408 | 15.2 | ||||||||
| Net income before provision for income taxes | 154 | 97 | 58.8 | ||||||||
| Provision for income taxes | 54 | 36 | 50.0 | ||||||||
| Net income | $ | 100 | $ | 61 | 63.9 | ||||||
| Preferred stock dividends | 64 | - | n/a | ||||||||
| Accretion of discount | 44 | - | n/a | ||||||||
| Income available to common stockholders | $ | (8 | ) | $ | 61 | (113.1 | ) | ||||
| Per share data and shares outstanding: (1) | |||||||||||
| Basic net income per share | $ | - | $ | 0.03 | (100.0 | ) | % | ||||
| Diluted net income per share | - | 0.03 | (100.0 | ) | |||||||
| Book value at period end | 10.65 | 9.26 | 15.0 | ||||||||
| Weighted average number of common shares outstanding (000's): | |||||||||||
| Basic | 1,791.5 | 1,791.5 | - | % | |||||||
| Diluted | 1,791.5 | 1,799.1 | (0.4 | ) | |||||||
| Shares outstanding at period end | 1,791.5 | 1,791.5 | - | ||||||||
| March 31, | December 31, | ||||||||||
| Balance sheet data | 2009 | 2008 | Change | ||||||||
| Total assets | $ | 345,277 | $ | 320,672 | 7.7 | % | |||||
| Loans receivable | 250,151 | 245,481 | 1.9 | ||||||||
| Allowance for loan losses | 2,777 | 2,450 | 13.3 | ||||||||
| Other interest-earning assets | 64,820 | 55,807 | 16.2 | ||||||||
| Noninterest-bearing deposits | 18,652 | 18,181 | 2.6 | ||||||||
| Interest-bearing deposits | 275,712 | 252,423 | 9.2 | ||||||||
| Borrowings | 23,248 | 30,248 | (23.1 | ) | |||||||
| Stockholders' equity | 26,009 | 18,195 | 42.9 | ||||||||
| Three months ended March 31, | |||||||||||
| Selected performance ratios: | 2009 | 2008 | |||||||||
| Return on average assets (2) | 0.12 | % | 0.09 | % | |||||||
| Return on average stockholders' equity (2) | 1.82 | 1.39 | |||||||||
| Net interest margin (2)(3) | 3.24 | 3.00 | |||||||||
| Net interest spread (2)(4) | 2.98 | 2.70 | |||||||||
| Noninterest income as a % of total revenue | 25.1 | 28.3 | |||||||||
| Noninterest income as a % of average assets (2) | 1.0 | 1.1 | |||||||||
| Efficiency ratio (5) | 84.22 | 90.22 | |||||||||
| Noninterest expense as a % of average assets (2) | 3.3 | 3.5 | |||||||||
| March 31, | December 31, | ||||||||||
| Asset quality ratios (at period end): | 2009 | 2008 | |||||||||
| Nonperforming assets to period-end loans (6) | 1.67 | % | 1.09 | % | |||||||
| Nonperforming assets to period-end assets (6) | 1.21 | 0.61 | |||||||||
| Allowance for loan losses to period-end loans | 1.11 | 1.00 | |||||||||
| Allowance for loan losses to total assets | 0.80 | 0.76 | |||||||||
| Net loan charge-offs to average loans outstanding (2) | 0.06 | 0.12 | |||||||||
| Oak Ridge Financial Services, Inc. | |||||||||||
| Financial Highlights (dollars in thousands, except share and per share data) | |||||||||||
| March 31, | December 31, | ||||||||||
| Capital and liquidity ratios: | 2009 | 2008 | |||||||||
| Equity to assets ratio | 7.5 | % | 5.7 | % | |||||||
| Loans to deposits | 90.7 | 97.2 | |||||||||
| Three months ended March 31, | |||||||||||
| Total Revenue | 2009 | 2008 | Change | ||||||||
| Net interest income | $ | 2,467 | $ | 1,915 | 28.8 | % | |||||
| Fees and other revenue: | |||||||||||
| Service charges on deposit accounts | 203 | 176 | 15.3 | ||||||||
| Mortgage loan origination fees | 156 | 95 | 64.2 | ||||||||
| Investment and insurance commissions | 174 | 206 | (15.5 | ) | |||||||
| Fee income from purchase of accounts receivable | 174 | 167 | 4.2 | ||||||||
| Income earned on bank owned life insurance | 31 | 40 | (22.5 | ) | |||||||
| Other | 90 | 70 | 28.6 | ||||||||
| Total noninterest income | 828 | 754 | 9.8 | ||||||||
| Total revenue | $ | 3,295 | $ | 2,669 | 23.5 | ||||||
| Three months ended March 31, | |||||||||||
| Noninterest Expense | 2009 | 2008 | Change | ||||||||
| Salaries and employee benefits | $ | 1,386 | $ | 1,284 | 7.9 | % | |||||
| Occupancy | 186 | 134 | 38.8 | ||||||||
| Equipment | 170 | 140 | 21.4 | ||||||||
| Data and items processing | 145 | 84 | 72.6 | ||||||||
| Professional and advertising | 290 | 287 | 1.0 | ||||||||
| Stationary and supplies | 55 | 62 | (11.3 | ) | |||||||
| Telecommunications expense | 67 | 64 | 4.7 | ||||||||
| Other real estate expenses and writedowns | 119 | - | n/a | ||||||||
| FDIC assessment | 73 | 50 | 46.0 | ||||||||
| Accounts receivable financing expense | 53 | 87 | (39.1 | ) | |||||||
| Other | 231 | 216 | 6.9 | ||||||||
| Total noninterest expense | $ | 2,775 | $ | 2,408 | 15.2 | ||||||
| Three months ended March 31, | |||||||||||
| Average Balances | 2009 | 2008 | Change | ||||||||
| Total assets | $ | 333,740 | $ | 273,907 | 21.8 | % | |||||
| Loans receivable | 248,858 | 219,860 | 13.2 | ||||||||
| Allowance for loan losses | 2,566 | 2,172 | 18.1 | ||||||||
| Other interest-earning assets | 59,652 | 35,754 | 66.8 | ||||||||
| Total deposits | 274,444 | 257,968 | 6.4 | ||||||||
| Borrowings | 25,270 | 24,993 | 1.1 | ||||||||
| Stockholders' equity | 22,024 | 17,608 | 25.1 | ||||||||
| (1) | Computed based on the weighted average number of shares outstanding during each period. | |
| (2) | Ratios for the three-month periods ended March 31, 2009 and 2008 are presented on an annualized basis. | |
| (3) | Net interest margin is net interest income divided by average interest earning assets. | |
| (4) | Net interest spread is the difference between the average yield on interest earning assets and the average cost of interest bearing liabilities. | |
| (5) | Efficiency ratio is noninterest expense divided by the sum of net interest income and noninterest income. | |
| (6) | Nonperforming assets consist of non-accruing loans, restructured loans and foreclosed assets, where applicable. |
Ron Black, President & CEO
336-644-9944