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FORM 10 - Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarter ended March 31, 2003 Commission file number 33-18888
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ORRSTOWN FINANCIAL SERVICES, INC.
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(Exact name of registrant as specified in its charter)
Commonwealth of Pennsylvania 23-2530374
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
77 East King Street 17257
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P.O. Box 250, Shippensburg, Pennsylvania (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (717) 532-6114
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Indicate by check mark whether the registrant (1) has filed all
reports required to be filled by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for
shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90
days.
YES X NO
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Class Outstanding at April 30, 2003
- -------------------------------- -----------------------------
(Common Stock, no par value ) 2,405,551
Page 1
ORRSTOWN FINANCIAL SERVICES, INC.
INDEX
Page
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Part I - FINANCIAL INFORMATION
Item 1. Financial statements (unaudited)
Condensed consolidated balance sheets
- March 31, 2003 and December 31, 2002. 4
Condensed consolidated statements of
income - Three months ended March 31,
2003 and 2002. 5
Condensed consolidated statements of
comprehensive income - Three months ended
March 31, 2003 and 2002. 6
Condensed consolidated statements of cash
flows - Three Months ended March 31, 2003
and 2002. 7
Notes to condensed consolidated financial
statements 8 - 10
Item 2. Management's discussion and analysis of financial
condition and results of operations 11 - 16
PART II - OTHER INFORMATION
Other Information 18
Signatures 19
Certifications of Principal Executive Officer and
Principal Financial Officer 20 - 23
Exhibits 24 - 26
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PART I - FINANCIAL INFORMATION
Page 3
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
ORRSTOWN FINANCIAL SERVICES, INC.
AND ITS WHOLLY-OWNED SUBSIDIARY, ORRSTOWN BANK
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Unaudited) (Audited)*
March 31, December
31,
(Dollars in Thousands) 2003 2002
- ----------------------------------------------------------------------
- -
ASSETS
Cash and due from banks $ 13,062 $ 10,656
Interest bearing deposits with banks 1,328 1,095
Federal funds sold 11,011 8,217
Securities available for sale 83,318 90,106
Federal Home Loan Bank, Federal
Reserve and Atlantic Central
Bankers Bank Stock, at cost which
approximates market value 2,918 2,268
Loans 299,698 281,391
Allowance for loan losses ( 3,979) (
3,734)
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Net Loans 295,719 277,657
Premises and equipment, net 10,138 9,849
Accrued interest receivable 1,668 1,606
Cash value-life insurance 6,984 6,916
Other assets 2,394 1,928
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Total assets $ 428,540 $ 410,298
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing $ 43,718 $ 42,704
Interest bearing 293,630 276,464
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Total deposits 337,348 319,168
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Federal funds purchased and other short
term borrowed funds 19,938 20,808
Long term borrowed funds 28,539 28,539
Accrued interest payable 247 248
Other liabilities 3,840 3,573
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Total liabilities 389,912 372,336
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Common stock, no par value-$.1041
stated value per share at March 31,
2003 and December 31, 2002,
10,000,000 shares authorized with
2,401,969 shares issued at March 31,
2003 and 2,398,405 issued at
December 31, 2002 250 250
Additional paid - in capital 26,089 25,913
Retained earnings 10,814 9,750
Accumulated other comprehensive income 1,475 2,049
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Total stockholders' equity 38,628 37,962
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Total liabilities and stockholders' equity $ 428,540 $ 410,298
========= =========
*Condensed from audited financial statements
The accompanying notes are an integral part of these condensed
financial statements.
Page 4
ORRSTOWN FINANCIAL SERVICES, INC.
AND ITS WHOLLY-OWNED SUBSIDIARY, ORRSTOWN BANK
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended
------------------
March March
(Dollars in Thousands) 2003 2002
- ---------------------------------------------------------------------
INTEREST INCOME
Interest and fees on loans $ 4,636 $ 4,542
Interest on federal funds sold 21 56
Interest and dividends on investment
securities 1,039 1,002
Interest income on deposits with banks 4 5
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Total interest income 5,700 5,605
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INTEREST EXPENSE
Interest on deposits 1,295 1,608
Interest on borrowed money 407 454
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Total interest expense 1,702 2,062
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Net interest income 3,998 3,543
Provision for loan losses 252 150
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Net interest income after provision for
loan losses 3,746 3,393
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OTHER INCOME
Service charges on deposits 610 476
Other service charges 254 219
Trust department income 319 322
Brokerage income 111 80
Other income 101 80
Securities gains / (losses) 178 1
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Total other income 1,573 1,178
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OTHER EXPENSES
Salaries and employee benefits 1,676 1,479
Net occupancy and equipment expenses 506 428
Other operating expenses 937 781
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Total other expense 3,119 2,688
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Income before income tax 2,200 1,883
Income tax expenses 656 549
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Net income $ 1,544 $ 1,334
======= =======
PER SHARE DATA
Earnings per share
Basic earnings per share $ 0.64 $ 0.56
Weighted average number of shares
outstanding 2,400,746 2,383,332
Diluted earnings per share $ 0.63 $ 0.55
Weighted average number of shares
outstanding 2,464,929 2,424,392
Dividends per share $ 0.20 $ 0.17
The accompanying notes are an integral part of these condensed
financial statements.
Page 5
ORRSTOWN FINANCIAL SERVICES, INC.
AND ITS WHOLLY-OWNED SUBSIDIARY, ORRSTOWN BANK
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
Three Months
Ended
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- ---
March
March
(Dollars in Thousands) 2003
2002
- ----------------------------------------------------------------------
- ---
COMPREHENSIVE INCOME
Net Income $ 1,544 $
1,334
Other comprehensive income, net of tax
Unrealized gain (loss) on investment securities
available for sale ( 574) (
104)
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- ----
Comprehensive Income $ 970 $
1,230
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=======
The accompanying notes are an integral part of these condensed
financial statements.
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