UCFC In spite of recession, company reports gains
This year's plans include a new bank branch in the Cleveland area and a Butler Wick Corp. office in Dayton.
By CYNTHIA VINARSKY
VINDICATOR BUSINESS WRITER
BOARDMAN -- Despite a recession that caused many American companies to struggle or die in 2001, Youngstown-based United Community Financial Corp. reported record-breaking increases in nearly every measurable category.
Presenting the company's financial picture to about 300 shareholders Thursday, officials boasted that assets, loan totals and deposit totals all grew 50 percent or more last year for UCFC, holding company for Home Savings and Loan and Butler Wick Corp.
For the year, the company reported profits of $15.7 million, or 48 cents per share, up 37 percent over 2000 results.
Assets totaled $1.94 billion at year's end, up 49.6 percent.
For the average shareholder, president and board chairman Douglas M. McKay explained, that translates to a book value per share of $7.34, a 37 percent increase over 2000.
McKay said a shareholder who invested $1,000 in UCFC stock when the company went public in 1998 would have more than doubled their investment by now, with an average annual return exceeding 34 percent.
So why, one shareholder asked, is UCFC's stock price far below several other local community and regional bank stocks?
UCFC closed at $8.10 Thursday, up 24 cents. In comparison, Second Bancorp, holding company of Second National Bank of Warren, closed at $26.50; F.N.B. Corp., parent of Metropolitan National Bank, closed at $31.07; First Place Financial Corp. closed at $16.92; and Sky Financial closed at $23.12.
McKay said one reason for the disparity is the large number of UCFC shares outstanding.
The public offering was so popular that the company sold more than 37 million shares, he explained, and 35.6 million are still outstanding despite an ongoing company effort to buy back stock.
UCFC stock has been included in a few mutual funds, McKay said, and officials will be approaching fund managers with the company's story again this year as another way to increase demand and drive the stock price up.
"We're growing in the fastest, safest way we know," he said.
David Lodge, president and chief operating officer of Home Savings, said the thrift was already doing well early in 2001, with deposits and loan volume both showing 19 percent increases.
The acquisition of Industrial Bancorp, final in mid-summer, added a major boost and gave Home Savings a foothold in the northwest part of the state.
Now, with 29 full-service offices and four loan origination offices spread across 11 northern Ohio counties, Lodge said, Home Savings is making plans to open another new branch office in the Cleveland area.
He expects to have that opening complete and another new office in the planning stages by year's end.
Butler Wick Corp.'s decline in profits and revenues in 2001 could be blamed mainly on the fluctuating stock market, said Tom Cavalier, president and chief executive. The investment advisory firm helped to offset those drops, he said, by diversifying.
Its trust company saw its revenue grow by 45 percent over the previous year. Its capital markets group, which helps municipalities, school systems, hospitals and other nonprofits raise money through bond offerings, saw its business grow 136 percent last year.
Cavalier said Butler Wick is also expanding its reach. It opened a new branch office in Columbus last year and recently opened another in Dayton.