Cass Information Systems, Inc. Finishes 2007 With 31% Increase in 4th Quarter Earnings
ST. LOUIS--(BUSINESS WIRE)--Jan. 30, 2008--Cass Information Systems, Inc. (NASDAQ: CASS), the nation's leading provider of transportation, utility and telecom invoice payment and information services ended its 2007 fiscal year on a strong note, reporting fourth quarter earnings of $.51 per fully diluted share, a 31% increase over the $.39 per fully diluted share it earned in the fourth quarter of 2006. Net income for the period was $4.7 million, compared to $3.7 million in 2006.
2007 4th Quarter Recap
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%
12/31/07 12/31/06 Change
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Transportation Dollar Volume $3.8 billion $3.5 billion 8.6%
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Utility Dollar Volume $2.0 billion $1.5 billion 33.3%
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Revenues $22.5 million $20.9 million 7.7%
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Net Income $4.7 million $3.7 million 27.0%
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Diluted Earnings per Share $.51 $.39 30.8%
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Payment and processing fees increased 10% or $1.1 million compared to the year-earlier period, as utility transaction volume was up 28% and dollar volume rose 33% due to new business and heightened activity from existing customers.
Operating expenses were up 5%, or $707,000, as a result of higher employee costs related to transaction growth. Income tax expense decreased slightly due to the growth of the company's state and municipal bond portfolios.
2007 Net Income Up 18% over 2006
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%
12/31/07 12/31/06 Change
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Transportation Dollar Volume $14.5 billion $14.2 billion 2.1%
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Utility Dollar Volume $7.7 billion $5.7 billion 35.1%
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Revenues $88.7 million $82.1 million 8.0%
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Net Income $17.8 million $15.1 million 17.9%
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Diluted Earnings per Share $1.90 $1.61 18.0%
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For the year ended December 31, 2007, Cass earned $1.90 per fully diluted share, an 18% increase from the $1.61 per fully diluted share reported for the same period in 2006. Net income was $17.8 million, 18% higher than the $15.1 million earned in 2006. Total revenue increased $6.6 million or 8% compared to 2006 primarily due to increased processing volumes and higher fee revenues.
For all of 2007, operating expenses were up 8%, or $4.5 million, mainly due to the increase in salaries and benefits required to support growth in processing activity. Income tax expense was down 3% due to growth of the company's state and municipal bond portfolios.
On December 17, 2007, Cass issued a 10% stock dividend to all shareholders of record.
"We are delighted with the 35% growth in transaction volume experienced by our utility invoice processing operations in 2007 and with the 18% increase in year-over-year earnings," said Lawrence A. Collett, Cass chief executive officer and chairman of the board. "From the larger perspective, it is gratifying that the company produced another solid year of results for our shareholders and that for the fourth consecutive year, we were able to provide a special stock dividend to them over and above the regular quarterly cash dividends we have paid without fail since 1934. We believe Cass is in a strong financial condition to provide a solid base for continued future growth as well as withstand the negative impacts of current difficulties in the financial arena."
Cass currently holds no sub-prime mortgage loans nor has any securities in its investment portfolio that contain any exposure to such instruments. The company holds no mortgage-backed securities or residential development loans of any kind. Hence, the issues that are having a significant detrimental effect on the financial community should not affect Cass in such a manner.
Authorizes 300,000 Share Stock Buy-Back
The Board of Directors also authorized the company to acquire up to an aggregate of 300,000 shares of its outstanding common stock, if deemed appropriate. The company may make these common stock repurchases from time to time in the open market or through negotiated transactions.
About Cass Information Systems
Cass Information Systems is the leading provider of transportation, utility and telecom invoice payment and information services. The company, which has been involved in the payables services and information support business since 1956, disburses over $22 billion annually on behalf of customers from processing centers in St. Louis, Mo., Columbus, Ohio, Boston, Mass., Greenville, S.C. and Wellington, Kansas. The support of Cass Commercial Bank, founded in 1906, makes Cass Information Systems unique in the industry. Cass is part of the Russell 2000(R) Index.
Note to Investors
Certain matters set forth in this news release may contain forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. However, such performance involves risks and uncertainties that may cause actual results to differ materially from those in such statements. For a discussion of certain factors that may cause such forward-looking statements to differ materially from the company's actual results, see the company's reports filed from time to time with the Securities and Exchange Commission including the company's annual report on Form 10-K for the year ended December 31, 2006.
Selected Consolidated Financial Data
The following table presents selected unaudited consolidated financial
data (in thousands, except per share data) for the periods ended
December 31, 2007 and 2006:
Quarter Quarter Year Year
Ended Ended Ended Ended
12/31/07 12/31/06 12/31/07 12/31/06
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Transportation
Invoice Volume 6,210 5,909 25,206 24,220
Transportation
Dollar Volume $3,755,348 $3,476,395 $14,519,906 $14,199,389
Utility Transaction
Volume 2,388 1,868 9,260 6,665
Utility Dollar
Volume $1,977,656 $1,483,314 $ 7,665,283 $ 5,671,892
Payment and
Processing Fees $ 11,553 $ 10,490 $ 45,642 $ 40,343
Net Investment
Income 10,252 9,813 40,482 39,284
Other 663 583 2,558 2,478
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Total Revenues $ 22,468 $ 20,886 $ 88,682 $ 82,105
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Salaries and
Benefits $ 11,830 $ 11,003 $ 46,965 $ 42,676
Occupancy 534 517 2,106 1,979
Equipment 791 800 3,356 2,928
Other 2,655 2,783 10,312 10,694
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Total Operating
Expenses $ 15,810 $ 15,103 $ 62,739 $ 58,277
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Income from
Continuing
Operations before
Income Taxes $ 6,658 $ 5,783 $ 25,943 $ 23,828
Provision for Income
Taxes 1,918 1,970 8,148 8,367
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Net Income from
Continuing
Operations $ 4,740 $ 3,813 $ 17,795 $ 15,461
Loss from
Discontinued
Operations net of
Income Taxes -- (118) -- (395)
----------- ----------- ------------ ------------
Net Income $ 4,740 $ 3,695 $ 17,795 $ 15,066
=========== =========== ============ ============
Basic Earnings per
Share $ .52 $ .40 $ 1.95 $ 1.65
=========== =========== ============ ============
Diluted Earnings per
Share $ .51 $ .39 $ 1.90 $ 1.61
=========== =========== ============ ============
Average Earning
Assets $ 841,174 $ 793,937 $ 809,738 $ 762,397
Net Interest Margin 5.36% 5.42% 5.45% 5.50%
Allowance for Loan
Losses to Loans 1.26% 1.31% 1.26% 1.31%
Non-performing Loans
to Total Loans .50% .16% .50% .16%
Net Loan Charge-offs
to Loans -- -- .24% .17%
Provision for Loan
Losses $ 225 $ 650 $ 900 $ 1,150
CONTACT: For Cass Information Systems, Inc.
Casey Communications, Inc.
Kenn Entringer, 314-721-2828
kentringer@caseycomm.com
http://www.cassinfo.com
SOURCE: Cass Information Systems, Inc.
