Farmers National Banc Corp. · NASDAQ:FMNB
Farmers National Banc — Investor Presentation (November 2013)
24 slides from Farmers National Banc's investor presentation, Nov 18, 2013
Slide 1: Investor Presentation September 30, 2013
1 Investor Presentation September 30, 2013
Slide 2: Disclosure Statement
2 Disclosure Statement Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements express management's current expectations, forecasts of future events or long-term-goals and,
Slide 3: Overview
3 Overview NASDAQ: FMNB Headquarters: Canfield, Ohio Stock Price: (9-30-13) $6.31 Market Cap: $118.5 million Dividend (yield): $0.12 (1.9%) 2012 Year-end Highlights 2012 Year-end Highlights Revenue $48.4 million Net Income $9.9 million Net Income per Diluted Share $0.53 Book Value $6.43 Total Assets
Slide 4: Who We Are
4 Who We Are Leading community bank in Ohio with deposit market share in the top ten in the counties we operate in Founded over 126 years ago 17 branches and 18 ATMs Sound franchise with many opportunities for growth Profitable throughout cycle and growing tangible book value per share Diversified a
Slide 5: Growing Franchise
5 Rated one of the Top 200 Community Banks in 2013, by American Banker Magazine for the second consecutive year 5-Star, Superior Rating from the Bauer Financial Group - the highest rating awarded by the financial group. Listed in Top 100 Best Banks, $1B - $5B, as scored by Bank Director Magazine , J
Slide 6: Operating in Mahoning Valley
6 Operating in Mahoning Valley Compelling Demographics Approximately 75 - 100 miles from Cleveland, Pittsburgh & Erie 6.8 million people 18 Fortune 500 company world headquarters 95 colleges and universities campus locations Northeast Ohio's manufacturing productivity is on track to outpace the rest
Slide 7: Attractive Deposit Franchise - Deposit Market Share
7 Note: Deposit data as of June 30, 2012 Source: SNL Opportunity for growth with approximately 10.60% deposit market share in the Mahoning Valley Large regional competitors lack focus - Community competitors inwardly focused Attractive Deposit Franchise - Deposit Market Share by MSA & County Tri-Cou
Slide 8: Increasing Shareholder Value
8 Increasing Shareholder Value Stable Dividend Policy Always paid a quarterly cash dividend Current yield 1.9% Two $0.03 per share special cash dividends declared in 2012 Dividend payout in 2012 was 34.1% of net income Stock Up 75% Since '08 *As of September 30, 2013
Slide 9: Industrial Growth Returning to The Valley
9 Source: Regional Chamber, Youngstown-Warren, Ohio Metropolitan Profile ,Valley Leads in Industrial Job Growth in NE Ohio, The Vindicator ,Ohio's Economic Impact Study - September, 2011 & 2012 Industrial Growth Returning to The Valley Steelmaker Vallourec's $650 million expansion - 350 jobs created
Slide 10: Farmers' Strategy for Growth
10 Performance-driven culture Advancing automation and use of technology Metrics-oriented accountability Scaling organization to support growth Diligent risk management Expand fee-based business Integrate sales efforts Continue to drive name awareness Unification of brand Top graded talent to drive
Slide 11: Farmers' Family Billboard
11 Farmers' Family Billboard
Slide 12: Experienced Management Team
Established and experienced management team with over 214 years of combined experience, 112 of which has been with Farmers. Experienced Management Team * Includes years with Butler Wick Trust Company
Slide 13: Growth Focus and Target Metrics
13 Focus for Growth Continued organic growth in current markets Growth opportunities in new markets with Private Banking, Trust and Investments Targeted acquisitions include fee-based business and banks Target Metrics for Acquisition Accretive to earnings near term (excluding one-time charges) Manag
Slide 14: Acquisitions to Enhance Fee-Based Revenue
14 Butler Wick Trust Company Acquisition Acquired for cash on March 31, 2009 Only locally owned trust company in the Mahoning Valley Rebranded to Farmers Trust Company Assets increased approximately 69% since acquisition Contributed $5.5 million to non-interest income in 2012 National Associates, In
Slide 15: Historical Operating Results
15 Meaningfully profitable every quarter during this cycle High net interest margin which has exceeded Midwest banks1 peer average 3.47% September 30, 2013 3.59% YTD Strong record of profitability Average ROAA and ROAE from 2007 through 2012 of 0.78% and 8.53%, respectively ROAA impacted by investme
Slide 16: Continued Strong Results - Overview of Q3 2013
16 Non Interest Income Increases 24% Noninterest income for the three months ended September 30, 2013 increased 23.9% from same quarter of 2012 123 consecutive quarters of positive earnings Net income for three months ended September 30, 2013 was $1.6 million compared to $2.5 million for same quarte
Slide 17: Growing and Diverse Revenue Stream
17 Acquisition of Trust Company increased non-interest income by 10.72% since first quarter 20091 Growing and Diverse Revenue Stream Note: Revenue defined as net interest income plus non-interest income; Excludes $1.1MM net gain on securities 1 Calculated as Q4 2012 trust revenue / Q1 2009 total rev
Slide 18: Overview of Loan Portfolio
18 Diverse loan mix No national lending No sub-prime lending Farmers' practice is to lend primarily within its market area Less than 2% of loan portfolio is participations purchased Less than 2% of loan portfolio is construction loans Loan Portfolio Mix - September 30, 2013 Overview of Loan Portfoli
Slide 19: Excellent Asset Quality
19 Excellent Asset Quality Note: Dollars in millions; Asset quality ratios exclude troubled debt restructuring 9/30/2013 Nonaccrual loans $8.4 Accruing loans past due 90 days or more 0.7 OREO 0.2 Total nonperforming assets (NPAs) $9.3 Troubled Debt Restructuring (TDR) $8.3 Loans 30-89 days delinquen
Slide 20: FMNB Comparative Valuation
Relative to similar sized Midwest banks and similar quality Nationwide banks, FMNB is undervalued FMNB Comparative Valuation Note: Peer data is the median value for the peer group; market data as of November 14, 2013; All asset quality ratios exclude troubled debt restructurings 1 Selected Midwest B
Slide 21: Supplemental Information
21 Supplemental Information
Slide 22: GAAP to Non-GAAP Reconciliation
22 GAAP to Non-GAPP Reconciliation Reconciliation of Common Stockholders' Equity to Tangible Common Equity Reconciliation of Common Stockholders' Equity to Tangible Common Equity Reconciliation of Common Stockholders' Equity to Tangible Common Equity Reconciliation of Common Stockholders' Equity to
Slide 23: Consolidated Statements of Income
23 Consolidated Statements of Income Consolidated Statements of Income For the Three Months Ended For the Three Months Ended For the Three Months Ended For the Three Months Ended For the Three Months Ended For the Nine Months Ended For the Nine Months Ended For the Nine Months Ended Sept 30, June 30
Slide 24: Consolidated Statements of Financial Condition
24 Consolidated Statements of Financial Condition Consolidated Statements of Financial Condition Consolidated Statements of Financial Condition Sept 30, June 30, March 31, Dec 31, Sept 30, 2013 2013 2013 2012 2012 Assets Cash and cash equivalents $40,303 $26,587 $57,312 $37,759 $79,494 Securities av
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