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The Honolulu Advertiser

Posted on: Wednesday, April 27, 2005

Central Pacific's earnings per share up 23 percent

 •  HEI profits down despite gains at American Savings
 •  Bank of Hawaii enjoys 14 percent rise in profits

Advertiser Staff

First-quarter earnings at Central Pacific Financial Corp. met the expectation of Wall Street analysts, who on average forecasted profits of 59 cents a share. At the news, shares of Hawai'i's fourth largest financial institution fell by 12 cents to close at $32 yesterday.

First quarter 2005

  • Net income: $17.2 million, up 117 percent from a year ago
  • Earnings per share: 59 cents, up 23 percent from a year ago
  • Net interest income: $46.3 million, up 104 percent from a year ago
  • Other operating income: $9.3 million, up 137 percent from a year ago
  • Total assets: $4.8 billion, up 109 percent from a year ago
  • Total deposits: $3.4 billion, up 87 percent from a year ago



Reasons

  • The merger of City Bank into Central Pacific substantially increased income, profits, assets, loans and leases, and other activity.
  • The first quarter included $1.5 million in merger-related expenses.
  • The bank had a lower tax rate in the first quarter compared to a year earlier.
  • The bank benefited from $1.8 million in state tax credits for its investments in high-tech Hawai'i businesses.



What they are saying

"Growth in our core lines of business in the post-merger environment is indicative of the strength and the potential of our combined organization."

— Clint Arnoldus | CEO

"I expect expenses to migrate lower as cost savings are phased in by the end of the year."

— J. Reeves | R. BECK ANALYST



What's next

  • The bank affirmed its 2005 earnings per share forecast of $2.50 to $2.60.
  • The bank expects to incur $500,000 in merger-related charges in the second quarter.
  • The bank said it is on track to achieve $13 million in cost savings this year from the merger.
  • All employees, except the CEO, are now eligible for stock grants depending on how well profits grow at the bank from 2005 to 2007.