FFW Corporation Announces Earnings, Share Repurchase and Special Dividend

Rhea-AI Summary

FFW Corporation (OTC PINK: FFWC) reported strong financial results for the quarter and nine months ended March 31, 2021. Net income for Q1 was $1,575,000, or $1.38 per share, up from $1,109,000, or $0.98 per share, in Q1 2020. Total noninterest income rose to $1,917,000, a significant increase from $774,000 in the previous year. The company declared a special cash dividend of $1.00 per share, payable June 1, 2021. Return on average equity improved to 12.00% for the quarter, while total assets reached $480.8 million, up from $461.7 million last year.

Positive

• Net income increased to $1,575,000 for Q1, up from $1,109,000 in Q1 2020.
• Total noninterest income rose to $1,917,000 compared to $774,000 year-over-year.
• Declared a special cash dividend of $1.00 per share, payable June 1, 2021.
• Return on average equity improved to 12.00% for Q1 2021.
• Total assets increased to $480,837,000 from $461,724,000 year-over-year.

Negative

• Provision for loan losses increased to $165,000 in Q1 from $75,000 in Q1 2020.
• Noninterest expenses rose to $3,570,000 compared to $3,067,000 in the previous year.

WABASH, Ind., April 28, 2021 (GLOBE NEWSWIRE) -- FFW Corporation (the “Corporation”) (OTC PINK: FFWC) (4/27/2021 Close: $43.00), parent corporation of Crossroads Bank (the “Bank”), announced earnings for the quarter and year to date ended March 31, 2021.

For the three months ended March 31, 2021, the Corporation reported net income of $1,575,000 or $1.38 per common share compared to $1,109,000 or $0.98 per common share for the three months ended March 31, 2020. Net interest income for the three months ended March 31, 2021 was $3,655,000 compared to $3,639,000 for the three months ended March 31, 2020. The provision for loan losses was $165,000 for the three months ended March 31, 2021 and $75,000 for the three months ended March 31, 2020. Total noninterest income was $1,917,000 for the three months ended March 31, 2021 compared to $774,000 for the three months ended March 31, 2020. Noninterest expense was $3,570,000 for the three months ended March 31, 2021 and $3,067,000 for the three months ended March 31, 2020.

For the nine months ended March 31, 2021, the Corporation reported net income of $5,096,000 or $4.46 per common share compared to $3,612,000 or $3.17 per common share for the nine months ended March 31, 2020. Net interest income for the nine months ended March 31, 2021 was $11,089,000 compared to $10,540,000 for the nine months ended March 31, 2020. The Company recognized a provision for loan losses of $495,000 for the nine months ended March 31, 2021 and $200,000 for the nine months ended March 31, 2020. Total noninterest income was $5,713,000 for the nine months ended March 31, 2021 compared to $2,830,000 for the nine months ended March 31, 2020. Noninterest expense was $10,255,000 for the nine months ended March 31, 2021 and $8,996,000 for the nine months ended March 31, 2020.

The three and nine months ended March 31, 2021 represented a return on average common equity of 12.00% and 13.12%, respectively, compared to 9.85% and 10.36% for the three and nine month periods ended March 31, 2020. The three and nine months ended March 31, 2021 represented a return on average assets of 1.36% and 1.44%, respectively, compared to 1.05% and 1.14%, for the three and nine month periods ended March 31, 2020.

The allowance for loan losses as a percentage of gross loans receivable was 1.45% at March 31, 2021 compared to 1.29% at June 30, 2020. Nonperforming assets were $3,187,000 at March 31, 2021 compared to $3,551,000 at June 30, 2020.

As of March 31, 2021, FFWC’s equity-to-assets ratio was 10.85% compared to 10.66% at June 30, 2020. Total assets at March 31, 2021 were $480,837,000 compared to $461,724,000 at June 30, 2020. Shareholders’ equity was $52,179,000 at March 31, 2021 compared to $49,198,000 at June 30, 2020. Crossroads Bank exceeds all applicable regulatory requirements to be considered “well capitalized.”

The Board of Directors has declared a special cash dividend of $1.00 per share of the Company’s common stock. The dividend is payable June 1, 2021 to shareholders of record on May 18, 2021.

The Corporation also announced today that its Board of Directors has approved plans to continue the stock repurchase program for its outstanding stock. The Corporation may suspend or discontinue repurchases at any time. Repurchases may begin as early as May 1, 2021.

“With our continued strong financial performance, it is appropriate to reward our shareholders for their support and confidence in the Company,” said President and CEO Roger K. Cromer. “Our excess capital still affords us the flexibility to strategically grow our business.”

Forward Looking Statements

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include expressions such as “expects,” “intends,” “believes,” and “should,” which are necessarily statements of belief as to the expected outcomes of future events. Actual results could materially differ from those presented. The Corporation's ability to predict future results involves a number of risks and uncertainties. The Corporation undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this release.

Crossroads Bank is a wholly owned subsidiary of FFW Corporation providing an extensive array of banking services and a wide range of investments and securities products through its main office in Wabash and nine Indiana banking centers located in Columbia City, North Manchester, Peru, South Whitley, Syracuse and Warsaw. The Bank also provides leasing services at each of its banking centers. Insurance products are offered through an affiliated company, Insurance 1 Services, Inc. The Corporation’s stock is traded on the OTC Markets under the symbol “FFWC.” Our website address is www.crossroadsbanking.com. Crossroads Bank, Member FDIC.

FFW Corporation Selected Financial Information
Consolidated Balance Sheet
	March 31			June 30
		2021			2020
	Unaudited
Assets
Cash and due from financial institutions	$	5,825,761		$	6,084,611
Interest-bearing deposits in other financial institutions		41,908,419			30,077,626
Cash and cash equivalents		47,734,180			36,162,237
Securities available for sale		116,138,400			86,147,475
Loans receivable, net of allowance for loan losses of $4,296,448 at
March 31, 2021 and $4,098,026 at June 30, 2020		289,424,448			303,102,891
Loans held for sale		2,203,417			10,876,733
Federal Home Loan Bank stock, at cost		1,462,500			1,462,500
Accrued interest receivable		1,971,414			2,281,588
Premises and equipment, net		9,113,259			9,338,832
Mortgage servicing rights		991,968			731,190
Cash surrender value of life insurance		9,383,989			9,159,293
Goodwill		1,213,898			1,213,898
Repossessed Assets		183,103			145,782
Other assets		1,016,833			1,101,841
Total assets	$	480,837,409		$	461,724,260
Liabilities and shareholders' equity
Deposits
Noninterest-bearing	$	53,965,966		$	42,014,196
Interest-bearing		370,437,144			366,527,945
Total deposits		424,403,110			408,542,141
Accrued expenses and other liabilities		4,255,104			3,984,019
Total liabilities		428,658,214			412,526,160
Shareholders' equity
Common stock, $.01 par; 2,000,000 shares authorized;
Issued: 1,836,328; outstanding: 1,142,690 - March 31, 2021 and 1,129,394 - June 30, 2020		18,363			18,363
Additional paid-in capital		9,757,704			9,826,124
Retained earnings		51,899,495			47,660,175
Accumulated other comprehensive income		2,220,423			3,634,798
Treasury stock, at cost: 693,638 shares at March 31, 2021 and 706,934 shares at June 30, 2020		(11,716,790	)		(11,941,360	)
Total shareholders' equity		52,179,195			49,198,100
Total liabilities and shareholders' equity	$	480,837,409		$	461,724,260

FFW Corporation Selected Financial Information
Consolidated Statement of Income
	Three Months Ended March 31						Nine Months Ended March 31
		2021			2020			2021			2020
	Unaudited			Unaudited			Unaudited			Unaudited
Interest and dividend income:
Loans, including fees	$	3,347,999		$	3,783,885		$	10,512,304		$	11,173,081
Taxable securities		340,065			357,866			994,577			1,042,224
Tax exempt securities		419,231			313,098			1,209,159			938,957
Other		6,281			66,667			23,790			233,454
Total interest and dividend income		4,113,576			4,521,516			12,739,830			13,387,716
Interest expense:
Deposits		458,636			873,790			1,651,282			2,818,437
Borrowings		-			9,156			-			29,434
Total interest expense		458,636			882,946			1,651,282			2,847,871
Net interest income		3,654,940			3,638,570			11,088,548			10,539,845
Provision for loan losses		165,000			75,000			495,000			200,000
Net interest income after provision for
loan losses		3,489,940			3,563,570			10,593,548			10,339,845
Noninterest income:
Net gains on sales of securities		-			(4,286	)		98,467			(4,545	)
Net gains on sales of loans		1,006,539			248,353			3,215,381			605,711
Net gains (losses) on fixed assets		-			-			9,204			-
Net gains (losses) on sales of REO		(16,963	)		(25,433	)		(23,498	)		(20,868	)
Commission income		344,053			275,209			915,456			865,022
Service charges and fees		238,602			30,911			533,440			548,581
Earnings on life insurance		74,875			73,164			224,695			217,829
Other		270,216			176,116			739,662			618,655
Total noninterest income		1,917,322			774,034			5,712,807			2,830,385
Noninterest expense:
Salaries and benefits		1,534,134			1,679,223			5,009,601			4,839,853
Occupancy and equipment		350,158			288,123			1,014,617			872,698
Professional		553,813			130,038			707,007			418,676
Marketing		105,096			95,689			327,689			295,594
Deposit insurance premium		33,000			-			99,000			38,939
Regulatory assessment		9,515			10,141			28,117			28,048
Correspondent bank charges		17,967			19,455			52,630			59,078
Data processing		400,609			369,857			1,221,879			1,031,253
Printing, postage and supplies		62,358			76,661			229,854			214,175
Expense on life insurance		20,611			14,895			52,309			44,684
Contribution expense		32,340			15,977			59,615			34,980
Expense on REO		5,018			9,010			13,057			29,682
Other		445,260			358,109			1,440,008			1,087,865
Total noninterest expense		3,569,879			3,067,178			10,255,383			8,995,525
Income before income taxes		1,837,383			1,270,426			6,050,972			4,174,705
Income tax expense		262,145			161,312			954,632			562,524
Net income	$	1,575,238		$	1,109,114		$	5,096,340		$	3,612,181

FFW Corporation Selected Financial Information
Key Balances and Ratios
		Three Months Ended March 31						Nine Months Ended March 31
			2021			2020			2021			2020
		Unaudited			Unaudited			Unaudited			Unaudited
Per common share data:
Earnings		$	1.38		$	0.98		$	4.46		$	3.17
Diluted earnings		$	1.38		$	0.98		$	4.46		$	3.17
Dividends paid		$	0.25		$	0.23		$	0.75		$	0.69
Average shares issued and outstanding			1,142,690			1,137,906			1,142,690			1,140,049
Shares outstanding end of period			1,142,690			1,129,394			1,142,690			1,129,394
Supplemental data:
Net interest margin **			3.37	%		3.69	%		3.35	%		3.57	%
Return on average assets ***			1.36	%		1.05	%		1.44	%		1.14	%
Return on average common equity ***			12.00	%		9.85	%		13.12	%		10.36	%
		March 31			June 30
			2021			2020
Nonperforming assets *		$	3,187,345		$	3,550,611
Repossessed assets		$	183,103		$	145,782
*	Includes non-accruing loans, accruing loans delinquent more than 90 days and repossessed assets
**	Yields reflected have not been computed on a tax equivalent basis
***	Annualized

FOR MORE INFORMATION Contact: Emily Boardman, Treasurer, at (260) 563-3185       

FAQ

What were FFW Corporation's earnings for Q1 2021?

FFW Corporation reported net income of $1,575,000, or $1.38 per common share, for Q1 2021.

What is the significance of the special cash dividend announced by FFWC?

A special cash dividend of $1.00 per share was declared, payable on June 1, 2021, rewarding shareholders for their support.

How did FFW Corporation's net interest income change in Q1 2021?

Net interest income for Q1 2021 was $3,655,000, slightly up from $3,639,000 in Q1 2020.

What is the return on average equity for FFWC for the quarter ended March 31, 2021?

The return on average equity for the quarter was 12.00%, up from 9.85% in the same quarter of 2020.

How did FFW Corporation's total assets change from last year?

Total assets increased to $480,837,000 as of March 31, 2021, from $461,724,000 a year earlier.