UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): June 4, 2004
CLASSIC BANCSHARES, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-27170 61-1289391
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(State or Other Jurisdiction) (Commission File No.) (I.R.S. Employer
of Incorporation) Identification No.)
344 17th Street, Ashland, Kentucky 41101
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (606) 326-2801
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Not Applicable
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(Former name or former address, if changed since last report)
Item 7. Financial Statements and Exhibits
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(a) Financial Statements of businesses acquired. Not Applicable.
(b) Pro forma financial information. Not Applicable.
(c) Exhibits.
The following Exhibit is attached as part of this report:
99.1 Press Release of Classic Bancshares, Inc. dated June 4, 2004
Item 12. Results of Operations and Financial Condition
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On June 4, 2004, Classic Bancshares, Inc. issued a press release relating
to its earnings for the year ended March 31, 2004. The press release is attached
as Exhibit 99.1 to this report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
CLASSIC BANCSHARES, INC.
DATE: June 4, 2004 By: /s/ Lisah M. Frazier
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Lisah M. Frazier, Chief Operations
Officer and Chief Financial Officer
EXHIBIT INDEX
Exhibit No. Description
99.1 Press Release of Classic Bancshares, Inc. dated June 4, 2004
FOR IMMEDIATE RELEASE
For Additional Information Contact:
David B. Barbour, President and Chief Executive Officer
Lisah M. Frazier, Chief Operating Officer and Chief Financial Officer
(606) 326-2800 Fax (606) 326-2801 www.classicbank.com
CLASSIC BANCSHARES, INC. REPORTS RECORD FISCAL 2004 EARNINGS
Ashland, Kentucky, -- June 4, 2004 -- Classic Bancshares, Inc. (NASDAQ -
CLAS) reported net income of $3.6 million, or $2.43 per diluted share for the
twelve months ended March 31, 2004 compared to net income of $2.9 million, or
$2.32 per diluted share for the twelve months ended March 31, 2003. Net income
for the fourth quarter ended March 31, 2004 was $971,000 or $.63 per diluted
share compared to $749,000 or $.59 per diluted share for the fourth quarter
ended March 31, 2003.
The Company's assets increased approximately $91.5 million from $249.9
million at March 31, 2003 to $341.4 million at March 31, 2004. The growth in the
period was primarily due to the acquisition of First Federal Financial Bancorp,
Inc. completed on June 20, 2003. On the date of closing, First Federal had total
assets of $72.1 million, net loans of $49.5 million and deposits of $56.7
million and the Company recorded goodwill and other intangibles of approximately
$3.4 million in connection with the acquisition. Aside from the acquisition, the
Company experienced asset growth of approximately $16.4 million. The growth for
the twelve-month period was primarily in the loan portfolio, which increased
approximately $70.3 million ($20.2 million exclusive of the loans acquired from
First Federal). Investment securities increased by $14.0 million ($5.7 million
exclusive of the acquisition). Deposits also increased by $70.1 million ($13.1
exclusive of the acquisition). Increased deposits were used to fund loan growth
during the twelve-month period.
Total non-performing assets represented .7% of total assets at March 31,
2004 compared to .5% at March 31, 2003. The increase reflects primarily
non-performing loans, most of which consisted of residential loans acquired from
First Federal. The Company recorded a provision for loan losses of $223,000 for
the twelve-month period and net charge-offs of $874,000 for the twelve-month
period and acquired an allowance from First Federal of approximately $885,000
resulting in an allowance for loan losses of $2.2 million at March 31, 2004. The
allowance at March 31, 2004 was equal to 149.7% of total non-performing loans
and .9% of total loans receivable.
President and Chief Executive Officer David B. Barbour commented, "We are
pleased to report our third consecutive year of record earnings coupled with
important accomplishments during the year that will enhance near- and long-term
prospects for the future. Our conservative business model continues to provide a
framework for dealing with uncertain and rapidly changing economic times. The
successful integration of our First Federal acquisition, coupled with organic
growth, resulted in a $91.5 million increase in assets to $341.4 million."
"Earnings per share of $2.43 for the year ending March 31, 2004, compared
to $2.32 for the prior year end represents a 4.7% increase and emphasizes
management's commitment to shareholder value through balance sheet management
and strong asset quality. Despite the thrift like balance sheet acquired in the
First Federal acquisition, management remains committed to pricing disciplines
that resulted in only a moderate compression of our net interest margin that
remains at levels that meets or exceeds our peers."
Net interest income increased for both the twelve-month period and the
fourth quarter. Net interest income increased $2.7 million for the twelve months
ended March 31, 2004 compared to the same period in 2003 and $927,000 for the
fourth quarter ended March 31, 2004 compared to the same period in 2003. The
increases in net interest income were primarily due to a larger earning asset
base as a result of the First Federal acquisition, purchases of securities, and
internal growth in loans experienced during the twelve-month period.
The Company's non-interest income grew for both the twelve-month period and
the quarter. Non-interest income increased $461,000 for the twelve months ended
March 31, 2004 compared to the same period in 2003 and $97,000 for the fourth
quarter ended March 31, 2004 compared to the same period in 2003. Non-interest
income increased primarily due to an increase in fees and service charges on
deposit accounts as a result of a larger deposit base. Non-interest income also
increased for the twelve months due to an increase in commissions earned on the
origination of secondary market loans. Although these fees increased for the
twelve months, fees earned from the origination of secondary market loans has
begun to slow, decreasing the amount of commissions earned during the past two
quarters and possibly in future periods. The Company's secondary market activity
consists only of commissions earned from a third party originator and represents
a small portion of the Company's non-interest income.
Non-interest expense increased for both the twelve-month period and the
quarter. Non-interest expense increased approximately $2.4 million for the
twelve months ended March 31, 2004 as compared to the twelve months ended March
31, 2003 and $739,000 for the fourth quarter ended March 31, 2004 compared to
the same period in 2003. The increase in non-interest expenses was due to an
increase in salaries and employee benefits, an increase in occupancy and
equipment expense, and an increase in supplies expense. All of these expenses
increased primarily due to the acquisition of First Federal. Non-interest
expenses also increased due to the increased costs related to incentive-based
compensation programs and benefit plans, an increase in ESOP expense due to the
increase in the average market price of the Company's stock, and an increase in
legal and accounting fees.
Classic Bancshares, Inc. is headquartered in Ashland, Kentucky and has one
subsidiary, Classic Bank. Classic Bank operates at 344 Seventeenth Street,
Ashland, Kentucky with nine branch offices located in Boyd, Carter, Greenup and
Johnson counties in Kentucky and Lawrence County, Ohio.
When used in this press release, the words or phrases "should result,"
"will likely result", "are expected to", "will continue", "is anticipated",
"estimate", "project" or similar expressions are intended to identify
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such statements are subject to certain risks and
uncertainties, including changes in economic condition in the Company's market
area including unemployment levels and plant closings, real estate values in the
Company's market area, changes in policies by regulatory agencies, fluctuations
in interest rates, demand for loans in the Company's market area and
competition, that could cause actual results to differ materially from
historical earnings and those presently anticipated or projected. The Company
wishes to caution readers not to place undue reliance on such forward-looking
statements, which speak only as of the date made. The Company wishes to advise
readers that the factors listed could affect the Company's financial performance
and could cause the Company's actual results for future periods to differ
materially from any opinions or statements expressed with respect to future
periods in any current statements.
The Company does not undertake-and specifically declines any obligation-to
publicly release the result of any revisions which may be made to any
forward-looking statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or unanticipated
events.
SELECTED FINANCIAL DATA
The following table sets forth selected financial data of Classic
Bancshares, Inc. as of March 31, 2004 and March 31, 2003 and for the three and
twelve months ended March 31, 2004 and 2003.
March 31, March 31,
2004 2003
(In Thousands)
Selected Financial Condition Data:
Total Assets $ 341,430 $ 249,881
Cash and other interest bearing deposits
with other financial institutions 9,211 8,148
Loans receivable, net 257,455 187,175
Securities available for sale 53,811 39,792
Goodwill and other intangible assets 8,797 5,555
Deposits 260,241 190,155
Securities sold under agreement to repurchase 9,168 4,382
FHLB advances 34,218 28,126
Stockholders' Equity 35,227 25,422
Three Months Ended Twelve Months Ended
March 31, March 31,
2004 2003 2004 2003
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(In Thousands)
Selected Operations Data:
Total interest income $ 4,637 $ 3,544 $ 17,301 $ 14,205
Total interest expense 1,352 1,186 5,397 4,970
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Net interest income 3,285 2,358 11,904 9,235
Provision for loan losses 66 122 223 428
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Net interest income after provision
for losses on loans 3,219 2,236 11,681 8,807
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Fees and service charges 436 310 1,705 1,338
Gain on sale of securities 41 61 43 72
Other noninterest income 75 84 388 265
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Total noninterest income 552 455 2,136 1,675
Total noninterest expense 2,395 1,656 8,732 6,457
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Income before income taxes 1,376 1,035 5,085 4,025
Income tax expense 405 286 1,460 1,104
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Net income $ 971 $ 749 $ 3,625 $ 2,921
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Basic earnings per share* $0.69 $0.65 $2.67 $2.53
Diluted earnings per share* $0.63 $0.59 $2.43 $2.32
At or for the At or for the
Three Months Ended Twelve Months Ended
March 31, March 31,
2004 2003 2004 2003
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Other Data:
Return on average assets (ratio of annualized
net income to total average assets) 1.1% 1.2% 1.2% 1.3%
Return on average equity (ratio of annualized
net income to total average equity) 11.2 11.9 11.4 12.2
Net interest margin** (Federal Tax Equivalent) 4.4 4.5 4.3 4.5
Non-performing assets to total assets 0.7 0.5 0.7 0.5
Allowance for loan losses to non-performing loans 149.7 155.7 149.7 155.7
Allowance for loan losses to loans receivable, net 0.9 1.0 0.9 1.0
Non-interest expenses/ Total revenues*** 61.4 58.0 60.5 57.1
Book value per share* $25.08 $20.91 $25.08 $20.91
Tangible book value per share* $18.81 $16.34 $18.81 $16.34
Total shares outstanding 1,404,839 1,216,035 1,404,839 1,216,035
Total weighted avg. shares outstanding for Diluted EPS 1,551,821 1,274,190 1,491,886 1,258,518
Number of full service offices 10 8 10 8
Number of ATM locations 23 20 23 20
* Per share information was adjusted for all periods presented to reflect the
stock dividend paid on November 17, 2003.
** Net interest income (Federal Tax Equivalent) annualized divided by average
earning assets.
*** Total revenues = Net interest income (Federal Tax Equivalent) +
non-interest income.