Penns Woods Bancorp, Inc. continued its solid earnings and growth during the recently completed first quarter of 2014, achieving net income of $3,469,000 for the three months ended March 31, 2014 resulting in basic and dilutive earnings per share of $0.72.
Highlights, according to a news release, included completion of the acquisition of Luzerne National Bank Corp. effective June 1, 2013 resulted in an increase in net loans of $254,057,000; investments of $21,140,000; deposits of $279,867,000; and assets of $329,209,000 at the time of acquisition.
Net income from core operations, which is a non-GAAP measure of net income excluding net securities gains and bank owned life insurance gains on death benefits, increased to $3,036,000 for the three months ended March 31, 2014 compared to $3,033,000 for the same period of 2013.
Operating earnings per share for the three months ended March 31, which includes shares issued in the Luzerne transaction, were $0.63 basic and dilutive compared to $0.79 basic and dilutive for the same period of 2013.
Return on average assets was 1.15 percent for the three months ended March 31 compared to 1.72 percent for the corresponding period of 2013.
Return on average equity was 10.58 percent for the three months ended March 31 compared to 15.51 percent for the corresponding period of 2013.
"The three months ended March 31 were impacted by several events. During this time frame our lead bank, Jersey Shore State Bank, undertook a significant upgrade to systems," Richard A. Grafmyre, president and CEO, said.
"The system changes included various improvements to our core processing system, new teller system, and enhancements to other various ancillary systems. While the upgrade at Jersey Shore State Bank was taking place, our employees were also preparing to convert Luzerne Bank in April from their legacy system to the new systems utilized by Jersey Shore State Bank. The various system enhancements impacted every facet of the company, but have provided a foundation and capacity for the company to grow moving forward as the sister banks now will have the capability to share services provided at the holding company level."
"The weather conditions of the first quarter also impacted the company as the cold, icy, and snowy conditions caused an increase in weather related operating costs. In addition, the winter weather led to fewer home purchases within our market than the prior year. This resulted in approximately a 20-percent reduction in secondary market revenue compared to the first three months of 2013," Richard A. Grafmyre, president and CEO, said.
A reconciliation of the non-GAAP financial measures of operating earnings, operating return on assets, operating return on equity, and operating earnings per share, described in the highlights, to the comparable GAAP financial measures is included at the end of this press release.