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Camco Financial Corp. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: November 13, 2012 02:07PM
Camco Financial Corp. (CAFI) filed Quarterly Report for the period ended 2012-09-30. Camco Financial Corp has a market cap of $14.6 million; its shares were traded at around $2.02 with a P/E ratio of 6.3 and P/S ratio of 0.3.
Highlight of Business Operations:In March 2012, Camco granted 262,492 shares of restricted stock awards with an impact to unearned/deferred compensation of $625,000. The stock was granted under the Camco Financial Corporation 2010 Equity Plan to officers based on 2011 performance. The issuance of the restricted stock vests over three years, 20% on the date of the award, 20% on the date that the Compensation Committee certifies Camcos 2013 financial results and 60% on the date that the Compensation Committee certifies Camcos 2014 financial results (such results are expected to be certified in the first quarter of 2014 and 2015, respectively). However, if Camcos pre-tax earnings for the fiscal year ending December 31, 2013 or 2014 are not equal to or greater than the pre-tax earnings for the fiscal year ending December 31, 2012; the participant will forfeit 25% of the equity award that is to vest on such date. Additionally, the vested shares have restrictions that generally lapse after one year. The grant date fair value per share of restricted stock is the stock price at close on grant date, which is being expensed on a straight-line basis during the vesting period. The shares represented by restricted stock awards are considered outstanding at the grant date, as the recipients are entitled to voting rights and dividends if declared. A summary of restricted stock award activity for the period is presented below:
Proceeds from sales of investment securities during the nine months ended September 30, 2012, totaled $8,000, resulting in gross realized gains of $1,000, and for the year ended December 31, 2011, proceeds from sales totaled $27.2 million, resulting in gross realized gains of $1.3 million.
Camco recognized net earnings for the nine months ended September 30, 2012, of $1.4 million, an increase of $2.0 million, or 312.8%, from the net loss of $(648,000) reported in the comparable 2011 period. On a per share basis, the net earnings were $0.19, compared to $(.09) per share in the first nine months of 2012 and 2011 respectively. The increase in earnings was primarily attributable to the additional $1.4 million of provision for loan losses recorded in the 2011 period compared to the 2012 period.
Net interest income totaled $18.1 million for the nine months ended September 30, 2012, a decrease of $1.4 million or 7.3%, compared to the nine month period ended September 30, 2011, generally reflecting the effects of a $11.4 million decrease in the average balance of interest earning assets coupled with the decrease of average yield on earning assets of 58 basis points. This was partially offset by a $36.6 million decrease in interest-bearing liabilities and a decrease of 33 basis points related to the cost of funding. Due to these changes, the net interest margin decreased 21 basis points to 3.45% in 2012 compared to 3.66% in 2011.
Net interest income totaled $6.0 million for the three months ended September 30, 2012, a decrease of $481,000 or 7.4%, compared to the three months period ended September 30, 2011, generally reflecting the effects of a decrease in the average yield on earning assets of 60 basis points coupled with the decrease of a $7.2 million in average balance of interest earning assets. This was partially offset by a $29.7 million decrease in interest-bearing liabilities and a decrease of 34 basis points related to the cost of funding. Due to these changes the net interest margin decreased 24 basis points to 3.49% in 2012 compared to 3.73% of 2011.
Stocks Discussed: CAFI,