A Note to our Shareholders: Customers are GS&L’s number one priority. In
We appreciate the opportunity to serve your financial needs. GS&L offers a vast selection of deposit and lending programs, with planned enhancements in technology and I-Banking services. We take pride in knowing our customers; we support and live in the communities we serve.
To supplement our financial information, which is prepared and presented in accordance with accounting principles generally accepted in
We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to our historical performance. We believe these non-GAAP financial measures are useful to investors because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of our business.
There are a number of limitations related to the use of non-GAAP financial measures. In light of these limitations, we provide specific information regarding the GAAP amounts excluded from these non-GAAP financial measures and evaluating these non-GAAP financial measures together with their relevant financial measures in accordance with GAAP.
For more information on these non-GAAP financial measures, please see the section titled “Definitions of Non-GAAP Measures” and “Reconciliations of Non-GAAP Measures” included at the end of this release.
Financial and Operational Metrics
For the Year Ending | ||||||||
2022 | 2021 | |||||||
Statement of Earnings | (In Thousands) | |||||||
Interest Income | $ | 4,547 | $ | 4,467 | ||||
Interest Expense | 268 | 365 | ||||||
Net Interest Income | 4,279 | 4,102 | ||||||
Provision for Loan Loss | 61 | 18 | ||||||
Net Interest Income After Provision for Loan Loss | 4,218 | 4,084 | ||||||
Non-interest Income | 2,805 | 2,093 | ||||||
Non-interest Expenses | 5,104 | 5,007 | ||||||
Income Before Income Tax | 1,919 | 1,170 | ||||||
Income Tax (Benefit) | 392 | (86 | ) | |||||
Net Income | $ | 1,527 | $ | 1,256 | ||||
Adjusted Statement of Earnings | ||||||||
Interest Income | $ | 4,547 | $ | 4,467 | ||||
Interest Expense | 268 | 365 | ||||||
Net Interest Income | 4,279 | 4,102 | ||||||
Provision for Loan Loss | 61 | 18 | ||||||
Net Interest Income After Provision for Loan Loss | 4,218 | 4,084 | ||||||
Non-interest Income | 2,805 | 2,093 | ||||||
Deduct: Unrealized gains on swap agreement | 2,158 | 943 | ||||||
Adjusted Non-interest Income (1) | 647 | 1,150 | ||||||
Non-interest Expenses | 5,104 | 5,007 | ||||||
Adjusted Earnings (Loss) Before Income Tax (1) (“AEBIT”) | (239 | ) | 227 | |||||
Income Tax (Benefit) | 392 | (86 | ) | |||||
Deduct: Change in EBIT tax calc. per income adj. | 453 | 198 | ||||||
Adjusted Income Tax (Benefit)(1) | (61 | ) | (284 | ) | ||||
Adjusted Net Income (Loss) (1) | $ | (178 | ) | $ | 511 |
(1) | “Adjusted Non-interest Income”, “Adjusted Earnings (Loss) Before Income Tax”, Adjusted Income Tax (Benefit)”, and “Adjusted Net Income (Loss)” are non-GAAP measures. See “Definitions of Non-GAAP |
(2) | Measures” and “Reconciliation of Non-GAAP Measures” sections herein for an explanation and reconciliation of non-GAAP measures used throughout this release. |
Reconciliation to Non-GAAP Net Income (Loss) | |||||||
For the fiscal years ending 2022 and 2021 | |||||||
(in thousands) | |||||||
2022 | 2021 | ||||||
Net Income | $ | 1,527 | $ | 1,256 | |||
Deduct: Unrealized gain on swap agreement | 2,158 | 943 | |||||
Addback: Change in EBIT tax calc. per income adj. | 453 | 198 | |||||
Adjusted Net Income (Loss) | $ | (178 | ) | $ | 511 | ||
Total revenue (net interest income plus non-interest income) for fiscal year 2022 was
Total adjusted revenue (net interest income plus adjusted non-interest income) for fiscal year 2022 was
Net income for the fiscal year ended
Adjusted net income (loss) for the fiscal year ended
Interest income on loans decreased
Interest expense on deposits decreased
Interest spread, the difference between the rate earned on interest-earning assets and the rate paid on interest-bearing liabilities, was 3.55% in fiscal 2022 and 3.54% in fiscal 2021.
Non-interest income increased
Adjusted non-interest income decreased
Total non-interest expense increased
For the year ended | |||||||
2022 | 2021 | ||||||
(In thousands) | |||||||
Salaries and employee benefits | $ | 2,291 | $ | 2,628 | |||
Directors’ fees | 274 | 256 | |||||
Data processing | 265 | 261 | |||||
Building, occupancy and equipment | 648 | 632 | |||||
Foreclosed assets, net | 31 | 71 | |||||
Merger related expenses | 558 | - | |||||
Other non-interest expense | 1,037 | 1,159 | |||||
Non-interest expense | $ | 5,104 | $ | 5,007 |
Net loans increased
Deposits increased
Total assets increased
Shareholders’ equity was
Non-GAAP Financial Measures
The Company has numerous interest rate swap agreements (“swaps”) with FHLBNY as a means to hedge the cost of certain borrowings and to increase the interest rate sensitivity of certain assets. Activity in Fiscal year 2021 resulted in an unrealized gain in market value of
Definitions of Non-GAAP Measures
Adjusted Non-Interest Income We define Adjusted Non-Interest Income as total non-interest earnings excluding certain items that may not be indicative of our recurring business operating results. Adjusted non-interest income excludes from non-interest income the non-cash measurement of the unrealized gains or losses in market value on swap agreements.
Adjusted Earnings (Loss) Before Income Tax We define AEBIT as net income (loss) before income tax, excluding certain items that may not be indicative of our recurring business operating results. AEBIT excludes from total earnings before income tax the non-cash measurement of the unrealized gains or losses in market value on swap agreements.
We have included AEBIT because it is a key measure used by our management team to evaluate our operating performance, generate future operating plans, and make strategic decisions, including those related to operating expenses. Accordingly, we believe that AEBIT provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management team and board of directors. In addition, it provides a useful measure for period-to-period comparisons of our business as it removes the effect of certain non-cash items with variable unrealized gains and losses. AEBIT is not meant as a substitute for the related financial information prepared in accordance with GAAP.
Adjusted Income Tax (Benefit) We define Adjusted Income Tax (Benefit) as the income tax calculated from the adjusted earnings before income tax. The marginal tax rate of 21% is applied to the non-cash measurement of the unrealized gains or losses in market value on swap agreements that are excluded from Adjusted Non-Interest Income.
Adjusted Net Income (Loss) We define Adjusted Net Income (Loss) as net income less certain items that may not be indicative of our recurring business operating results. Adjusted Net Income (Loss) excludes the non-cash measurement of the unrealized gains or losses in market value on swap agreements held with FHLBNY and the subsequent recalculation of associated income tax. Adjusted Net Income (Loss) should be considered a supplement, and not a substitute for, net income prepared in accordance with GAAP.
Forward-Looking Statements
The Company, which is headquartered in
Statements in this news release contain forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs of management as well as assumptions made using information currently available to management. Since these statements reflect the views of management concerning future events, these statements involve risks, uncertainties and assumptions. These risks and uncertainties include among others, the impact of changes in market interest rates and general economic conditions, changes in government regulations, changes in accounting principles and the quality or composition of the loan and investment portfolios. Therefore, actual future results may differ significantly from results discussed in the forward-looking statements.
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