PWOD - Penns Woods Bancorp Inc. Reports Second Quarter 2019 Earnings

July, 23 2019 01:17 PM Penns Woods Bancorp Inc.

WILLIAMSPORT, Pa., July 23, 2019 (GLOBE NEWSWIRE) -- Penns Woods Bancorp, Inc. (NASDAQ: PWOD)

Penns Woods Bancorp, Inc., supported by loan and deposit growth, achieved net income of $8.2 million for the six months ended June 30, 2019, resulting in basic and diluted earnings per share of $1.75.

Highlights

Net income, as reported under GAAP, for the three and six months ended June 30, 2019 was $4.2 million and $8.2 million, compared to $3.5 million and $6.7 million for the same periods of 2018. Results for the three and six months ended June 30, 2019 compared to 2018 were impacted by an increase in after-tax securities gains of $6,000 (from a gain of $12,000 to a gain of $18,000) for the three month periods and $90,000 (from a loss of $20,000 to a gain of $70,000) for the six month periods.
Basic and diluted earnings per share for the three and six months ended June 30, 2019 was $0.91 and $1.75, respectively, an increase in basic and diluted earnings per share of $0.17 and $0.32 as compared to the three and six months ended June 30, 2018.
Return on average assets was 1.02% for the three months ended June 30, 2019, compared to 0.91% for the corresponding period of 2018. Return on average assets was 0.99% for the six months ended June 30, 2019, compared to 0.89% for the corresponding period of 2018.
Return on average equity was 11.42% for the three months ended June 30, 2019, compared to 10.07% for the corresponding period of 2018. Return on average equity was 11.27% for the six months ended June 30, 2019, compared to 9.68% for the corresponding period of 2018.

Net Income

Net income from core operations (“core earnings”), which is a non-generally accepted accounting principles (GAAP) measure of net income excluding net securities gains or losses, was $4.2 million for the three months ended June 30, 2019 compared to $3.5 million for the same period of 2018. Core earnings increased to $8.2 million for the six months ended June 30, 2019, compared to $6.7 million for the same period of 2018. Core earnings per share for the three months ended June 30, 2019 was $0.90 basic and diluted, an increase from $0.74 basic and diluted core earnings per share for the same period of 2018. core earnings per share for the six months ended June 30, 2019 was $1.73 basic and diluted, compared to $1.43 basic and diluted for the same period of 2018. Core return on average assets and core return on average equity were 1.01% and 11.37% for the three months ended June 30, 2019, compared to 0.90% and 10.04% for the corresponding period of 2018. Core return on average assets and core return on average equity were 0.98% and 11.18% for the six months ended June 30, 2019 compared to 0.89% and 9.71% for the corresponding period of 2018. A reconciliation of the non-GAAP financial measures of core earnings, core return on assets, core return on equity, and core earnings per share described in this press release to the comparable GAAP financial measures is included at the end of this press release.

Net Interest Margin

The net interest margin for the three and six months ended June 30, 2019 was 3.39% and 3.37%, compared to 3.32% and 3.31% for the corresponding periods of 2018. The increase in the net interest margin was driven by an increase in the yield on earning assets of 40 and 44 basis points ("bps") for the three and six month periods. The impact of the increase in yield on earning assets was limited by the increase in rate paid on interest-bearing liabilities of 42 bps and 45 bps for the three and six month periods. The increase in the yield on earning assets was driven by an increase in the loan portfolio yield in conjunction with an increase in the average loan portfolio of $83.4 million and $103.5 million, respectively. The loan growth for the three and six month periods was primarily funded by an increase in average total deposits of $119.2 million and $108.0 million, respectively.

Assets

Total assets increased $108.2 million to $1.7 billion at June 30, 2019 compared to June 30, 2018. Net loans increased $47.2 million to $1.4 billion at June 30, 2019 compared to June 30, 2018, primarily due to campaigns related to increasing home equity product market share and indirect auto lending. The investment portfolio increased $24.4 million from June 30, 2018 to June 30, 2019 due to increases in the taxable municipal portfolio.

Non-performing Loans

The ratio of non-performing loans to total loans ratio increased to 1.12% at June 30, 2019 from 0.54% at June 30, 2018 as non-performing loans have increased to $15.4 million at June 30, 2019 from $7.1 million at June 30, 2018 primarily due to a commercial loan relationship that became non-performing during the fourth quarter of 2018. The majority of non-performing loans involve loans that are either in a secured position and have sureties with a strong underlying financial position or have a specific allocation for any impairment recorded within the allowance for loan losses. Net loan charge-offs of $106,000 and $511,000 for the three and six months ended June 30, 2019 minimally impacted the allowance for loan losses, which was 1.02% of total loans at June 30, 2019. The majority of the loans charged-off had a specific allowance within the allowance for loan losses.

Deposits

Deposits increased $136.1 million to $1.3 billion at June 30, 2019 compared to June 30, 2018. Noninterest-bearing deposits increased $11.6 million to $322.8 million at June 30, 2019 compared to June 30, 2018. Driving deposit growth is our commitment to easy-to-use products, community involvement, and emphasis on customer service. Deposit gathering efforts have centered on core deposits as building customer relationships remains the focus. The time deposit portfolio has increased as time deposits have been used as a customer attraction tool. This has led to the average maturity of the time deposit portfolio being lengthened.

Shareholders’ Equity

Shareholders’ equity increased $12.4 million to $151.5 million at June 30, 2019 compared to June 30, 2018. The change in accumulated other comprehensive loss from $6.9 million at June 30, 2018 to $2.8 million at June 30, 2019 is a result of an increase in unrealized gains on available for sale securities (from an unrealized loss of $2.1 million at June 30, 2018 to an unrealized gain of $2.4 million at June 30, 2019). The amount of accumulated other comprehensive loss at June 30, 2019 was also impacted by the change in net excess of the projected benefit obligation over the fair value of the plan assets of the defined benefit pension plan, resulting in an increase in the net loss of $349,000. The current level of shareholders’ equity equates to a book value per share of $32.30 at June 30, 2019 compared to $29.66 at June 30, 2018, and an equity to asset ratio of 8.85% at June 30, 2019 compared to 8.68% at June 30, 2018. Dividends declared for the six months ended June 30, 2019 and 2018 were $0.94 per share.

Penns Woods Bancorp, Inc. is the parent company of Jersey Shore State Bank, which operates seventeen branch offices providing financial services in Lycoming, Clinton, Centre, Montour, and Union Counties, and Luzerne Bank, which operates nine branch offices providing financial services in Luzerne County. Investment and insurance products are offered through Jersey Shore State Bank’s subsidiary, The M Group, Inc. D/B/A The Comprehensive Financial Group. Insurance products are offered through United Insurance Solutions, LLC, a joint venture that is a subsidiary of the holding company.

NOTE: This press release contains financial information determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). Management uses the non-GAAP measure of net income from core operations in its analysis of the company’s performance. This measure, as used by the Company, adjusts net income determined in accordance with GAAP to exclude the effects of special items, including significant gains or losses that are unusual in nature such as net securities gains and losses. Because these certain items and their impact on the Company’s performance are difficult to predict, management believes presentation of financial measures excluding the impact of such items provides useful supplemental information in evaluating the operating results of the Company’s core businesses. These disclosures should not be viewed as a substitute for net income determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

This press release may contain certain “forward-looking statements” including statements concerning plans, objectives, future events or performance and assumptions and other statements, which are statements other than statements of historical fact. The Company cautions readers that the following important factors, among others, may have affected and could in the future affect actual results and could cause actual results for subsequent periods to differ materially from those expressed in any forward-looking statement made by or on behalf of the Company herein: (i) the effect of changes in laws and regulations, including federal and state banking laws and regulations, and the associated costs of compliance with such laws and regulations either currently or in the future as applicable; (ii) the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies as well as by the Financial Accounting Standards Board, or of changes in the Company’s organization, compensation and benefit plans; (iii) the effect on the Company’s competitive position within its market area of the increasing consolidation within the banking and financial services industries, including the increased competition from larger regional and out-of-state banking organizations as well as non-bank providers of various financial services; (iv) the effect of changes in interest rates; and (v) the effect of changes in the business cycle and downturns in the local, regional or national economies. For a list of other factors which could affect the Company’s results, see the Company’s filings with the Securities and Exchange Commission, including “Item 1A. Risk Factors,” set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.

You should not place undue reliance on any forward-looking statements. These statements speak only as of the date of this press release, even if subsequently made available by the Company on its website or otherwise. The Company undertakes no obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.

Previous press releases and additional information can be obtained from the Company’s website at www.pwod.com.

Contact:

Richard A. Grafmyre, Chief Executive Officer

110 Reynolds Street

Williamsport, PA 17702

570-322-1111

e-mail: pwod@pwod.com

THIS INFORMATION IS SUBJECT TO YEAR-END AUDIT ADJUSTMENT

PENNS WOODS BANCORP, INC.
CONSOLIDATED BALANCE SHEET
(UNAUDITED)



June 30,
(In Thousands, Except Share Data)

2019

2018

% Change
ASSETS:






Noninterest-bearing balances

$
21,102


$
26,134


(19.25
)%
Interest-bearing balances in other financial institutions

58,423


29,873


95.57
%
Total cash and cash equivalents

79,525


56,007


41.99
%







Investment debt securities, available for sale, at fair value

145,689


118,876


22.56
%
Investment equity securities, at fair value

1,841


2,438


(24.49
)%
Investment securities, trading

44


243


(81.89
)%
Restricted investment in bank stock, at fair value

15,087


16,716


(9.75
)%
Loans held for sale

2,880


2,118


35.98
%
Loans

1,379,285


1,331,073


3.62
%
Allowance for loan losses

(14,001
)

(13,034
)

7.42
%
Loans, net

1,365,284


1,318,039


3.58
%
Premises and equipment, net

33,573


27,385


22.60
%
Accrued interest receivable

5,708


4,618


23.60
%
Bank-owned life insurance

28,955


28,315


2.26
%
Goodwill

17,104


17,104


—
%
Intangibles

1,022


1,304


(21.63
)%
Operating lease right of use asset

4,239


—


n/a

Deferred tax asset

3,712


4,941


(24.87
)%
Other assets

6,837


5,169


32.27
%
TOTAL ASSETS

$
1,711,500


$
1,603,273


6.75
%








LIABILITIES:







Interest-bearing deposits

$
1,004,331


$
879,825


14.15
%
Noninterest-bearing deposits

322,755


311,194


3.72
%
Total deposits

1,327,086


1,191,019


11.42
%








Short-term borrowings

59,453


134,637


(55.84
)%
Long-term borrowings

154,597


123,970


24.71
%
Accrued interest payable

1,482


896


65.40
%
Operating lease liability

4,241


—


n/a

Other liabilities

13,100


13,616


(3.79
)%
TOTAL LIABILITIES

1,559,959


1,464,138


6.54
%








SHAREHOLDERS’ EQUITY:







Preferred stock, no par value, 3,000,000 shares authorized; no shares issued

—


—


n/a

Common stock, par value $8.33, 15,000,000 shares authorized; 5,012,898 and 5,010,535 shares issued; 4,692,748 and 4,690,385 outstanding

41,773


41,753


0.05
%
Additional paid-in capital

51,087


50,225


1.72
%
Retained earnings

73,565


66,181


11.16
%
Accumulated other comprehensive loss:







Net unrealized gain (loss) on available for sale securities

2,419


(2,057
)

217.60
%
Defined benefit plan

(5,202
)

(4,853
)

(7.19
)%
Treasury stock at cost, 320,150

(12,115
)

(12,115
)

—
%
TOTAL PENNS WOODS BANCORP, INC. SHAREHOLDERS' EQUITY

151,527


139,134


8.91
%
Non-controlling interest

14


1


1,300.00
%
TOTAL SHAREHOLDERS' EQUITY

151,541


139,135


8.92
%
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$
1,711,500


$
1,603,273


6.75
%

PENNS WOODS BANCORP, INC.
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)



Three Months Ended June 30,

Six Months Ended June 30,
(In Thousands, Except Per Share Data)

2019

2018

% Change

2019

2018

% Change
INTEREST AND DIVIDEND INCOME:












Loans including fees.

$
15,300


$
12,997


17.72
%

$
30,169


$
25,190


19.77
%
Investment securities:














Taxable

967


639


51.33
%

1,901


1,185


60.42
%
Tax-exempt

179


230


(22.17
)%

353


471


(25.05
)%
Dividend and other interest income

395


245


61.22
%

852


466


82.83
%
TOTAL INTEREST AND DIVIDEND INCOME

16,841


14,111


19.35
%

33,275


27,312


21.83
%















INTEREST EXPENSE:














Deposits

2,871


1,490


92.68
%

5,171


2,712


90.67
%
Short-term borrowings

178


252


(29.37
)%

783


476


64.50
%
Long-term borrowings

879


666


31.98
%

1,730


1,268


36.44
%
TOTAL INTEREST EXPENSE

3,928


2,408


63.12
%

7,684


4,456


72.44
%















NET INTEREST INCOME

12,913


11,703


10.34
%

25,591


22,856


11.97
%















PROVISION FOR LOAN LOSSES

315


335


(5.97
)%

675


495


36.36
%















NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES

12,598


11,368


10.82
%

24,916


22,361


11.43
%















NON-INTEREST INCOME:














Service charges

592


592


—
%

1,154


1,143


0.96
%
Debt securities (losses) gains, available for sale

(2
)

14


(114.29
)%

11


5


120.00
%
Equity securities gains (losses)

22


6


266.67
%

65


(28
)

332.14
%
Securities gains (losses), trading

3


(5
)

160.00
%

13


(2
)

750.00
%
Bank-owned life insurance

123


158


(22.15
)%

291


331


(12.08
)%
Gain on sale of loans

347


400


(13.25
)%

663


655


1.22
%
Insurance commissions

119


64


85.94
%

253


181


39.78
%
Brokerage commissions

356


330


7.88
%

679


673


0.89
%
Debit card income

389


373


4.29
%

699


706


(0.99
)%
Other

520


430


20.93
%

895


779


14.89
%
TOTAL NON-INTEREST INCOME

2,469


2,362


4.53
%

4,723


4,443


6.30
%















NON-INTEREST EXPENSE:














Salaries and employee benefits

5,523


4,919


12.28
%

11,024


9,967


10.60
%
Occupancy

668


699


(4.43
)%

1,447


1,440


0.49
%
Furniture and equipment

784


801


(2.12
)%

1,536


1,548


(0.78
)%
Software amortization

188


231


(18.61
)%

395


296


33.45
%
Pennsylvania shares tax

285


278


2.52
%

578


555


4.14
%
Professional Fees

727


649


12.02
%

1,249


1,215


2.80
%
Federal Deposit Insurance Corporation deposit insurance

236


200


18.00
%

504


402


25.37
%
Marketing

33


268


(87.69
)%

135


519


(73.99
)%
Intangible amortization

69


78


(11.54
)%

140


158


(11.39
)%
Other

1,546


1,394


10.90
%

2,865


2,694


6.35
%
TOTAL NON-INTEREST EXPENSE

10,059


9,517


5.70
%

19,873


18,794


5.74
%
INCOME BEFORE INCOME TAX PROVISION

5,008


4,213


18.87
%

9,766


8,010


21.92
%
INCOME TAX PROVISION

759


733


3.55
%

1,571


1,322


18.84
%
NET INCOME

$
4,249


$
3,480


22.10
%

$
8,195


$
6,688


22.53
%
Earnings attributable to noncontrolling interest

4


—


n/a


6


(1
)

700.00
%
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS'

$
4,245


$
3,480


21.98
%

$
8,189


$
6,689


22.42
%
EARNINGS PER SHARE - BASIC

$
0.91


$
0.74


22.97
%

$
1.75


$
1.43


22.38
%
EARNINGS PER SHARE - DILUTED

$
0.91


$
0.74


22.97
%

$
1.75


$
1.43


22.38
%
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC

4,692,335


4,689,932


0.05
%

4,692,045


4,689,656


0.05
%
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED

4,692,335


4,703,339


(0.23
)%

4,692,045


4,689,656


0.05
%
DIVIDENDS DECLARED PER SHARE

$
0.47


$
0.47


—
%

$
0.47


$
0.47


—
%



Three Months Ended


June 30, 2019

June 30, 2018
(Dollars in Thousands)

Average Balance

Interest

Average Rate

Average Balance

Interest

Average Rate
ASSETS:












Tax-exempt loans

$
71,193


$
548


3.09
%

$
75,859


$
563


2.98
%
All other loans

1,313,388


14,867


4.54
%

1,225,343


12,552


4.11
%
Total loans

1,384,581


15,415


4.47
%

1,301,202


13,115


4.04
%















Taxable securities

130,802


1,300


4.03
%

93,024


871


3.75
%
Tax-exempt securities

27,971


227


3.29
%

40,300


291


2.89
%
Total securities

158,773


1,527


3.90
%

133,324


1,162


3.49
%















Interest-bearing deposits

10,431


62


2.38
%

3,034


13


1.72
%















Total interest-earning assets

1,553,785


17,004


4.39
%

1,437,560


14,290


3.99
%















Other assets

113,443







97,034





















TOTAL ASSETS

$
1,667,228







$
1,534,594





















LIABILITIES AND SHAREHOLDERS’ EQUITY:














Savings

$
170,142


51


0.12
%

$
165,231


16


0.04
%
Super Now deposits

246,454


453


0.74
%

234,731


242


0.41
%
Money market deposits

249,169


596


0.96
%

243,771


290


0.48
%
Time deposits

335,721


1,771


2.12
%

253,398


942


1.49
%
Total interest-bearing deposits

1,001,486


2,871


1.15
%

897,131


1,490


0.67
%















Short-term borrowings

32,086


178


2.23
%

56,530


252


1.76
%
Long-term borrowings

147,571


879


2.24
%

123,970


666


2.12
%
Total borrowings

179,657


1,057


2.23
%

180,500


918


2.01
%















Total interest-bearing liabilities

1,181,143


3,928


1.31
%

1,077,631


2,408


0.89
%















Demand deposits

317,623







302,742






Other liabilities

19,747







16,024






Shareholders’ equity

148,715







138,197




















TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$
1,667,228






$
1,534,594






Interest rate spread





3.08
%





3.10
%
Net interest income/margin



$
13,076


3.39
%



$
11,882


3.32
%



Three Months Ended June 30,


2019

2018
Total interest income

$
16,841


$
14,111

Total interest expense

3,928


2,408

Net interest income

12,913


11,703

Tax equivalent adjustment

163


179

Net interest income (fully taxable equivalent)

$
13,076


$
11,882

PENNS WOODS BANCORP, INC.
AVERAGE BALANCES AND INTEREST RATES



Six Months Ended


June 30, 2019

June 30, 2018
(Dollars in Thousands)

Average Balance

Interest

Average Rate

Average Balance

Interest

Average Rate
ASSETS:












Tax-exempt loans

$
71,874


$
1,087


3.05
%

$
75,548


$
1,130


3.02
%
All other loans

1,313,121


29,310


4.50
%

1,205,945


24,297


4.06
%
Total loans

1,384,995


30,397


4.43
%

1,281,493


25,427


4.00
%















Taxable securities

128,431


2,650


4.18
%

88,670


1,630


3.68
%
Tax-exempt securities

27,344


447


3.31
%

41,225


596


2.89
%
Total securities

155,775


3,097


4.03
%

129,895


2,226


3.43
%















Interest-bearing deposits

8,493


103


2.45
%

2,603


21


1.63
%















Total interest-earning assets

1,549,263


33,597


4.38
%

1,413,991


27,674


3.94
%















Other assets

112,806







97,318





















TOTAL ASSETS

$
1,662,069







$
1,511,309





















LIABILITIES AND SHAREHOLDERS’ EQUITY:














Savings

$
168,543


81


0.10
%

$
164,140


32


0.04
%
Super Now deposits

239,022


832


0.70
%

230,930


449


0.39
%
Money market deposits

245,307


1,068


0.88
%

240,127


500


0.42
%
Time deposits

317,782


3,190


2.02
%

244,805


1,731


1.43
%
Total interest-bearing deposits

970,654


5,171


1.07
%

880,002


2,712


0.62
%















Short-term borrowings

63,881


783


2.47
%

59,152


476


1.60
%
Long-term borrowings

145,890


1,730


2.24
%

119,274


1,268


2.11
%
Total borrowings

209,771


2,513


2.31
%

178,426


1,744


1.94
%















Total interest-bearing liabilities

1,180,425


7,684


1.29
%

1,058,428


4,456


0.84
%















Demand deposits

315,380







298,011






Other liabilities

20,953







16,645






Shareholders’ equity

145,311







138,225





















TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$
1,662,069







$
1,511,309






Interest rate spread





3.09
%





3.00
%
Net interest income/margin



$
25,913


3.37
%



$
23,218


3.31
%



Six Months Ended June 30,


2019

2018
Total interest income

$
33,275


$
27,312

Total interest expense

7,684


4,456

Net interest income

25,591


22,856

Tax equivalent adjustment

322


362

Net interest income (fully taxable equivalent)

$
25,913


$
23,218

(Dollars in Thousands, Except Per Share Data)

Quarter Ended


6/30/2019

3/31/2019

12/31/2018

9/30/2018

6/30/2018
Operating Data










Net income

$
4,245


$
3,944


$
4,189


$
3,826


$
3,480

Net interest income

12,913


12,678


12,699


12,255


11,703

Provision for loan losses

315


360


760


480


335

Net security gains (losses)

23


66


(165
)

(24
)

15

Non-interest income, ex. net security gains (losses)

2,446


2,188


2,594


2,613


2,347

Non-interest expense

10,059


9,814


9,532


9,681


9,517












Performance Statistics










Net interest margin

3.39
%

3.37
%

3.33
%

3.30
%

3.32
%
Annualized return on average assets

1.02
%

0.95
%

1.02
%

0.96
%

0.91
%
Annualized return on average equity

11.42
%

10.93
%

11.77
%

10.94
%

10.07
%
Annualized net loan charge-offs to average loans

0.03
%

0.12
%

0.08
%

0.05
%

0.04
%
Net charge-offs

106


405


266


171


137

Efficiency ratio

65.0
%

65.5
%

61.9
%

64.6
%

67.2
%











Per Share Data










Basic earnings per share

$
0.91


$
0.84


$
0.89


$
0.82


$
0.74

Diluted earnings per share

0.91


0.84


0.89


0.82


0.74

Dividend declared per share

0.47


0.47


0.47


0.47


0.47

Book value

32.30


31.33


30.59


29.96


29.66

Common stock price:










High

45.25


44.50


44.18


46.27


46.92

Low

39.04


34.84


38.66


43.22


41.29

Close

45.25


41.10


40.24


43.45


44.78

Weighted average common shares:










Basic

4,692


4,692


4,691


4,691


4,690

Fully Diluted

4,692


4,692


4,691


4,691


4,703

End-of-period common shares:










Issued

5,012


5,012


5,012


5,011


5,011

Treasury

320


320


320


320


320

(Dollars in Thousands, Except Per Share Data)

Quarter Ended


6/30/2019

3/31/2019

12/31/2018

9/30/2018

6/30/2018
Financial Condition Data:










General










Total assets

$
1,711,500


$
1,704,708


$
1,684,771


$
1,670,348


$
1,603,273

Loans, net

1,365,284


1,370,678


1,370,920


1,355,762


1,318,039

Goodwill

17,104


17,104


17,104


17,104


17,104

Intangibles

1,022


1,091


1,162


1,233


1,304

Total deposits

1,327,086


1,309,061


1,219,903


1,210,477


1,191,019

Noninterest-bearing

322,755


321,657


320,814


313,111


311,194

Savings

171,992


170,005


166,063


164,449


166,183

NOW

238,410


253,475


207,819


223,963


216,109

Money Market

238,352


244,753


238,596


238,131


245,081

Time Deposits

355,577


319,171


286,611


270,823


252,452

Total interest-bearing deposits

1,004,331


987,404


899,089


897,366


879,825












Core deposits*

971,509


989,890


933,292


939,654


938,567

Shareholders’ equity

151,527


147,026


143,536


140,538


139,134












Asset Quality










Non-performing loans

$
15,386


$
15,794


$
16,572


$
8,739


$
7,132

Non-performing loans to total assets

0.90
%

0.93
%

0.98
%

0.52
%

0.44
%
Allowance for loan losses

14,001


13,792


13,837


13,343


13,034

Allowance for loan losses to total loans

1.02
%

1.00
%

1.00
%

0.97
%

0.98
%
Allowance for loan losses to non-performing loans

91.00
%

87.32
%

83.50
%

152.68
%

182.75
%
Non-performing loans to total loans

1.12
%

1.14
%

1.20
%

0.64
%

0.54
%





















Capitalization




















Shareholders’ equity to total assets

8.85
%

8.62
%

8.52
%

8.41
%

8.68
%

* Core deposits are defined as total deposits less time deposits

Reconciliation of GAAP and Non-GAAP Financial Measures



Three Months Ended June 30,

Six Months Ended June 30,
(Dollars in Thousands, Except Per Share Data)

2019

2018

2019

2018
GAAP net income

$
4,245


$
3,480


$
8,189


$
6,689

Less: net securities gains (losses), net of tax

18


12


70


(20
)
Non-GAAP core earnings

$
4,227


$
3,468


$
8,119


$
6,709












Three Months Ended June 30,

Six Months Ended June 30,


2019

2018

2019

2018
Return on average assets (ROA)

1.02
%

0.91
%

0.99
%

0.89
%
Less: net securities gains (losses), net of tax

0.01
%

0.01
%

0.01
%

—
%
Non-GAAP core ROA

1.01
%

0.90
%

0.98
%

0.89
%











Three Months Ended June 30,

Six Months Ended June 30,


2019

2018

2019

2018
Return on average equity (ROE)

11.42
%

10.07
%

11.27
%

9.68
%
Less: net securities gains (losses), net of tax

0.05
%

0.03
%

0.09
%

(0.03
)%
Non-GAAP core ROE

11.37
%

10.04
%

11.18
%

9.71
%











Three Months Ended June 30,

Six Months Ended June 30,


2019

2018

2019

2018
Basic earnings per share (EPS)

$
0.91


$
0.74


$
1.75


$
1.43

Less: net securities gains (losses), net of tax

0.01


—


0.02


—

Non-GAAP basic core EPS

$
0.90


$
0.74


$
1.73


$
1.43








Three Months Ended June 30,

Six Months Ended June 30,


2019

2018

2019

2018
Diluted EPS

$
0.91


$
0.74


$
1.75


$
1.43

Less: net securities gains (losses), net of tax

0.01


—


0.02


—

Non-GAAP diluted core EPS

$
0.90


$
0.74


$
1.73


$
1.43

Company Name:	Penns Woods Bancorp Inc.
Stock Symbol:	PWOD
Market:	NASDAQ
Website:	pwod.com

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