Pinnacle Bancshares Announces Results for Third Quarter Ended September 30, 2024

Rhea-AI Summary

Pinnacle Bancshares (OTCBB: PCLB) reported Q3 2024 financial results with net income of $1,057,000 ($1.16 per share), down from $1,174,000 ($1.29 per share) in Q3 2023. For the nine months ended September 30, 2024, net income was $3,027,000 ($3.33 per share) compared to $3,499,000 ($3.85 per share) in 2023. The bank maintained strong capital ratios, with common equity Tier 1 and Tier 1 risk-based capital ratios at 18.78%, total capital ratio at 19.90%, and Tier 1 leverage ratio at 11.52%. Total deposits increased by $3.3 million (1%) compared to December 2023, with no nonperforming assets reported.

Positive

• Strong capital ratios well above 'well-capitalized' requirements
• No nonperforming assets reported
• Deposits increased by $3.3 million (1%)
• Net funding availability at 105.48%, well above 25% minimum requirement

Negative

• Q3 2024 net income decreased 10% YoY to $1,057,000
• Nine-month net income declined 13.5% YoY to $3,027,000
• Net interest margin decreased to 3.18% from 3.37% YoY
• Accumulated comprehensive loss of $21.8 million on securities due to higher interest rates

JASPER, Ala.--(BUSINESS WIRE)-- Robert B. Nolen, Jr., President and Chief Executive Officer of Pinnacle Bancshares, Inc. (OTCBB: PCLB), today announced Pinnacle’s third quarter results of operations.

• For the three months ended September 30, 2024, Pinnacle’s basic/diluted earnings per share was $1.16 as compared to $1.29 for the three months ended September 30, 2023. Net income for the three months ended September 30, 2024 was $1,057,000 as compared to $1,174,000 for the three months ended September 30, 2023 and $981,000 for the three months ended December 31, 2023.
• For the nine months ended September 30, 2024, Pinnacle’s basic/diluted earnings per share was $3.33 as compared to $3.85 for the nine months ended September 30, 2023. Net income for the nine months ended September 30, 2024 was $3,027,000 as compared to $3,499,000 for the nine months ended September 30, 2023.
• For the three and nine months ended September 30, 2024, return on average assets was 1.20%, and 1.17%, respectively, compared to 1.40% and 1.39%, respectively, in the comparable 2023 period.

Pinnacle’s net interest margin was 3.24% and 3.18% for the three and nine months ended September 30, 2024, respectively, compared to 3.25% and 3.37% for the three and nine months ended September 30, 2023, respectively.

At September 30, 2024, Pinnacle’s allowance for loan losses as a percent of total loans was 1.84%, compared to 1.96% at December 31, 2023. There were no nonperforming assets at September 30, 2024 as well as at December 31, 2023.

Pinnacle Bank was classified as “well capitalized” at September 30, 2024. All capital ratios are higher than the requirements for a well-capitalized institution. As of September 30, 2024, the Bank’s common equity Tier 1 capital and Tier 1 risk-based capital ratios were each 18.78%. As of September 30, 2024, its total capital ratio was 19.90%, and its Tier 1 leverage ratio was 11.52%.

Dividends of $.27 and $.81 per share were paid to shareholders during the three and nine months ended for both September 30, 2024 and September 30, 2023.

Management believes that the Company has adequate liquidity through its low loan to deposit ratio at September 30, 2024, as well as available funding from outside sources. Our net funding availability, as a percentage of our franchise funding, is 105.48% as compared to our established minimal limit of 25%. In addition, the Bank provides access to additional FDIC insurance coverage for accounts that would otherwise exceed deposit insurance coverage. The Company’s total deposits at September 30, 2024 increased $3.3 million, or 1%, as compared to December 31, 2023.

Effects of Inflation

Inflation caused a substantial rise in interest rates during 2022 and 2023 which has had a negative effect in the securities market. As a result of the increase in interest rates since 2022, the Company has recorded an accumulated other comprehensive loss on securities available for sale of approximately $21.8 million as of September 30, 2024 as compared to recording other comprehensive loss in the amount of $26.7 million as of December 31, 2023. Although these unrealized losses recorded as of September 30, 2024 were significant, management does not anticipate these losses to be other than temporary as these unrealized losses do not currently appear related to any credit deterioration within the portfolio but from higher interest rates.

Forward-Looking Statements

Information contained in this press release, other than historical information, may be considered forward-looking in nature and is subject to various risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or expected. Pinnacle undertakes no duty to update any forward-looking statement to conform the statement to actual results or changes in Pinnacle’s expectations. Certain tabular presentations may not reconcile because of rounding.

Pinnacle Bancshares, Inc.’s wholly owned subsidiary Pinnacle Bank has seven offices located in central and northwest Alabama.

PINNACLE BANCSHARES, INC. Unaudited Financial Highlights (In Thousands, except share and per share data)
		Three Months Ended September 30,
			2024				2023
Net income		$	1,057,000			$	1,174,000
Basic and diluted earnings per share		$	1.16			$	1.29
Performance ratios (annualized):
Return on average assets			1.20	%			1.40	%
Return on average equity (excluding OCI)			10.32	%			12.30	%
Interest rate spread			2.68	%			2.84	%
Net interest margin			3.24	%			3.25	%
Operating cost to assets			2.34	%			2.24	%
Weighted average basic and diluted shares outstanding			908,508				909,534
Dividends per share		$	0.27			$	0.27
Provision for loan losses		$	-			$	-
		Nine Months Ended September 30,
			2024				2023
Net income		$	3,027,000			$	3,499,000
Basic and diluted earnings per share		$	3.33			$	3.85
Performance ratios (annualized):
Return on average assets			1.17	%			1.39	%
Return on average equity (excluding OCI)			10.00	%			12.52	%
Interest rate spread			2.64	%			3.07	%
Net interest margin			3.18	%			3.37	%
Operating cost to assets			2.37	%			2.29	%
Weighted average basic and diluted shares outstanding			909,127				909,534
Dividends per share		$	0.81			$	0.81
Provision for loan losses		$	-			$	-
						(Audited)
		September 30, 2024				December 31, 2023
Total assets		$	349,193,000			$	342,578,000
Loans receivable, net		$	128,862,000			$	122,973,000
Deposits		$	314,702,000			$	311,339,000
Brokered CD’s included in deposits		$	14,895,000			$	11,907,000
Total stockholders’ equity		$	19,951,000			$	12,787,000
Book value per share		$	21.97			$	14.06
Book value per share (excluding OCI)		$	45.56			$	43.02
Average Stockholders’ equity to assets ratio (excluding OCI)			11.67	%			11.25	%
Asset quality ratios:
Nonperforming loans as a percent of total loans			.00	%			.00	%
Nonperforming assets as a percent of total loans			.00	%			.00	%
Allowance for loan losses as a percent of total loans			1.84	%			1.96	%

FINANCIAL INFORMATION   PINNACLE BANCSHARES, INC. CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
	(Unaudited)				(Audited)
	September 30,				December 31,
		2024				2023
Assets
Cash and cash equivalents	$	2,285,483			$	2,190,793
Interest bearing deposits in banks		14,162,953				19,518,942
Securities available for sale		173,332,274				165,520,025
Restricted equity securities		954,300				836,200
Loans		131,279,465				125,433,112
Less Allowance for loan losses		2,417,390				2,459,372
Loans, net		128,862,075				122,973,740
Premises and equipment, net		8,319,522				8,421,289
Right-of-use lease assets – operating		270,944				302,171
Goodwill		306,488				306,488
Bank owned life insurance		10,918,511				10,601,839
Accrued interest receivable		1,608,138				2,107,189
Deferred tax assets, net		7,337,873				8,951,799
Other assets		834,435				847,912
Total assets	$	349,192,996			$	342,578,387
Liabilities and Stockholders’ Equity
Deposits
Noninterest-bearing	$	86,434,945			$	89,518,619
Interest-bearing		228,267,309				221,820,527
Total deposits		314,702,254				311,339,146
Subordinated debentures		3,093,000				3,093,000
Other borrowings		9,000,000				12,500,000
Accrued interest payable		769,491				1,392,273
Operating lease liabilities		270,944				302,171
Other liabilities		1,406,324				1,165,256
Total liabilities		329,242,013				329,791,846
Stockholders’ equity
Common stock, par value $.01 per share; 2,400,000 authorized; 1,872,313 issued; 908,134 and 909,534 shares outstanding, respectively		18,723				18,723
Additional paid‑in capital		8,923,223				8,923,223
Treasury stock, 964,179 and 962,779 shares at cost, respectively		(15,630,199	)			(15,588,799	)
Retained earnings		48,063,272				45,772,256
Accumulated other comprehensive loss, net		(21,424,036	)			(26,338,862	)
Total stockholders’ equity		19,950,983				12,786,541
Total liabilities and stockholders’ equity	$	349,192,996			$	342,578,387

PINNACLE BANCSHARES, INC.   UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023
Interest income
Loans, including fees	$	2,198,772		$	1,941,342		$	6,361,388		$	5,524,642
Securities available for sale		1,327,160			1,361,835			3,990,155			4,156,942
Other interest		395,345			235,620			1,044,262			573,914
Total interest income		3,921,277			3,538,797			11,395,805			10,255,498
Interest expense
Deposits		811,310			556,599			2,329,581			1,166,228
Borrowings		201,884			148,848			570,949			289,178
Subordinated debentures		39,050			39,050			117,150			117,150
Total interest expense		1,052,244			744,497			3,017,680			1,572,556
Net interest income		2,869,033			2,794,300			8,378,125			8,682,942
Provision for loan losses		-			-			-			-
Net interest income after provision for loan losses		2,869,033			2,794,300			8,378,125			8,682,942
Other income
Fees and service charges on deposit accounts		429,651			503,147			1,278,274			1,255,373
Service fee income, net		-			677			743			2,164
Bank owned life insurance		106,500			97,806			316,672			294,418
Mortgage fee income		1,514			1,345			6,167			12,113
Total other income		537,665			602,975			1,601,856			1,564,068
Other expense:
Salaries and employee benefits		1,172,413			1,104,360			3,468,123			3,341,009
Occupancy expense		303,811			215,091			936,914			671,430
Marketing and professional expense		76,575			70,122			223,863			206,713
Other operating expenses		508,549			495,168			1,508,230			1,544,281
Total other expenses		2,061,348			1,884,741			6,137,130			5,763,433
Income before income taxes		1,345,350			1,512,534			3,842,851			4,483,577
Income tax expense		288,258			338,607			815,383			984,541
Net income	$	1,057,092		$	1,173,927		$	3,027,468		$	3,499,036
Cash dividend per share	$	0.27		$	0.27		$	0.81		$	0.81
Basic and diluted earnings per share	$	1.16		$	1.29		$	3.33		$	3.85
Weighted –average basic and diluted shares outstanding		908,508			909,534			909,127			909,534

PINNACLE BANCSHARES, INC.   UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY Nine Months Ended September 30, 2024 and 2023
																	Accumulated
						Additional											Other				Total
	Common Stock					Paid-in			Treasury				Retained				Comprehensive				Stockholders’
	Shares		Amount			Capital			Stock				Earnings				Loss				Equity
Balance December 31, 2022	1,872,313		$	18,723		$	8,923,223		$	(15,588,799	)		$	42,274,372			$	(29,889,603	)		$	5,737,916
Net income	-			-			-							3,499,036				-				3,499,036
Cash dividends declared ($.81 per share)	-			-			-			-				(736,715	)			-				(736,715	)
Other comprehensive loss	-			-			-			-				-				(4,650,949	)			(4,650,949	)
Balance September 30, 2023	1,872,313		$	18,723		$	8,923,223		$	(15,588,799	)		$	45,036,693			$	(34,540,552	)		$	3,849,288

																	Accumulated
						Additional											Other				Total
	Common Stock					Paid-in			Treasury				Retained				Comprehensive				Stockholders’
	Shares		Amount			Capital			Stock				Earnings				Loss				Equity
Balance December 31, 2023	1,872,313		$	18,723		$	8,923,223		$	(15,588,799	)		$	45,772,256			$	(26,338,862	)		$	12,786,541
Net income	-			-			-							3,027,468				-				3,027,468
Cash dividends declared ($.81 per share)	-			-			-			-				(736,452	)			-				(736,452	)
Purchase of treasury stock	-			-			-			(41,400	)			-				-				(41,400	)
Other comprehensive income	-			-			-			-				-				4,914,826				4,914,826
Balance September 30, 2024	1,872,313		$	18,723		$	8,923,223		$	(15,630,199	)		$	48,063,272			$	(21,424,036	)		$	19,950,983

PINNACLE BANCSHARES, INC.   UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
	For the Nine Months Ended
	September 30,
		2024				2023
OPERATING ACTIVITIES:
Net income	$	3,027,468			$	3,499,036
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		393,633				296,162
Net investment amortization expense		147,629				130,812
Net increase in bank owned life insurance		(316,672	)			(294,418	)
Decrease in accrued interest receivable		499,051				540,306
Increase (decrease) in accrued interest payable		(622,782	)			841,497
Net other operating activities		80,801				201,969
Net cash provided by operating activities		3,209,128				5,215,364
INVESTING ACTIVITIES:
Net increase in loans		(5,888,335	)			(3,300,429	)
Net (increase) decrease in interest bearing deposits in other banks		5,355,989				(11,285,255	)
Purchase of securities available for sale		(6,323,402	)			-
Proceeds from maturing, calls, and payments received on securities available for sale		5,066,020				8,295,689
Net purchase of restricted equity securities		(118,100	)			(62,600	)
Purchase of premises and equipment		(291,866	)			(1,725,739	)
Net cash used in investing activities		(2,199,694	)			(8,078,334	)
FINANCING ACTIVITIES:
Net increase (decrease) in deposits		3,363,108				(8,904,782	)
Proceeds from other borrowings		16,500,000				16,100,000
Repayments of other borrowings		(20,000,000	)			(3,600,000	)
Purchase of treasury stock		(41,400	)			-
Payments of cash dividends		(736,452	)			(736,715	)
Net cash provided by (used in) financing activities		(914,744	)			2,858,503
Net increase (decrease) in cash and cash equivalents		94,690				(4,467	)
Cash and cash equivalents at beginning of period		2,190,793				1,742,938
Cash and cash equivalents at end of period	$	2,285,483			$	1,738,471
SUPPLEMENTAL DISCLOSURES:
Cash paid during the period for:
Interest	$	3,640,462			$	731,059
Taxes	$	700,747			$	945,928
OTHER NONCASH TRANSACTIONS
Real estate acquired through foreclosure	$	-			$	-
Internally financed sales of other real estate owned	$	-			$	-

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20241030595801/en/

Joe B. Adams, III

Chief Financial Officer

(205) 221-8866

Source: Pinnacle Bancshares, Inc.

FAQ

What was Pinnacle Bancshares (PCLB) earnings per share in Q3 2024?

Pinnacle Bancshares reported basic/diluted earnings per share of $1.16 for Q3 2024.

How much did Pinnacle Bancshares (PCLB) net income decrease in Q3 2024?

Net income decreased from $1,174,000 in Q3 2023 to $1,057,000 in Q3 2024, representing a 10% decline.

What was PCLB's return on average assets for Q3 2024?

Return on average assets was 1.20% for Q3 2024, down from 1.40% in Q3 2023.

What dividend did Pinnacle Bancshares (PCLB) pay in Q3 2024?

Pinnacle Bancshares paid a dividend of $0.27 per share during Q3 2024.