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CLEVELAND - Top executives of Sky Financial Group Inc. acknowledged yesterday that this year's first quarter was disappointing but reassured shareholders that the company is on track for a year almost as strong as 2004.
"The results were disappointing but not a disaster," said Marty Adams, chairman and chief executive officer.
The Bowling Green bank holding company reported its first quarter profit was $31.5 million, or 29 cents a share, down 46 percent from $58.7 million, or 62 cents a share, for the same quarter a year earlier.
The earnings were lower in part because the company more than quadrupled its provision for credit losses to $30.8 million, mostly from two large commercial loans that went bad and the sale of a portfolio of non-performing loans.
" The higher credit losses, which lowered earnings, are not indicative of any systemic concern," Mr. Adams told an audience of about 70 shareholders and bank staff at the meeting in a hotel in downtown Cleveland.
The company expects this year's profit to be $1.69 to $1.72 a share, which is in keeping with analysts' estimates of $1.71 a share. The company had a profit last year of $194 million, or $1.93 a share.
Sky's news didn't please investors, however. The company's stock dropped 56 cents to $26.32 a share on Nasdaq yesterday.
Following the meeting that lasted less than 10 minutes and dealt only with the re-election of five directors, Mr. Adams and Kevin Thompson, chief financial officer, gave a presentation that explained how Sky has grown into a bank with $15 billion in assets.
Asset growth has come partly from acquisitions, including the $297 million buy of Belmont Bancorp in West Virginia, expected to close June 1 of this year. The firm hopes to continue purchasing banks in metropolitan areas like Pittsburgh, Cleveland, and Columbus.
"We're still looking," Mr. Adams said.
There are no plans, he added, to do anything different in the greater Toledo market, despite an increased presence soon by both Rurban Financial Corp. and First Defiance Financial Corp. because of recent acquisitions by the two Defiance bank holding companies.
A major push, the Sky CEO said, has been to try to sell current customers more than one service offered by Sky. "The best way to grow in an economy like ours is to look at the clients you have and sell them more services," he said.
In its first-quarter financial report, Sky said it reported net interest income of $124 million, up from $102 million a year earlier.
Contact Mary-Beth McLaughlin at
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