PENNS WOODS BANCORP,INC. (NASDAQ:PWOD) Files An 8-K Other EventsItem 8.01 Other Events.
On December22, 2017, H.R.1, known as the “Tax Cuts and Jobs Act,” was signed into law. H.R.1, among other things, reduces the corporate income tax rate to 21%, effective January1, 2018. As a result of passage of the new tax law, Penns Woods Bancorp,Inc. (the “Company”) is completing a revaluation of its net deferred tax assets. The Company’s deferred tax assets, net of deferred tax liabilities, represent corporate tax benefits anticipated to be realized in the future. The reduction in the federal corporate tax rate, effective January1, 2018, reduces these benefits. The Company’s preliminarily estimate is that its net deferred tax assets would be reduced by approximately $3.7 million in the fourth quarter of 2017, representing an impact on earnings per share of approximately ($0.79) per diluted share based on estimated fourth quarter weighted average diluted shares outstanding of approximately 4.7 million.
The Company’s revaluation of its deferred tax assets is subject to further clarifications of the new law that cannot be estimated at this time, and, as such, the Company is unable to make a final determination of the impact on the quarterly and year-to-date earnings for the period ended December31, 2017. The reduction of the Company’s deferred tax assets may vary materially from the estimated amount. The Company does not anticipate future cash expenditures as a result of the reduction to the net deferred tax assets.
This Current Report on Form8-K contains forward-looking statements regarding the Company’s outlook and expectations with respect to the enactment of H.R.1, effective January1, 2018, including the expected impact of H.R.1 on the Company’s deferred tax assets, the impact of the revaluation of the deferred tax assets on the Company’s fourth quarter 2017 earnings and that the Company does not anticipate future cash expenditures as a result of the reduction in the deferred tax assets. Words and phrases such as “anticipates,” “expects,” “believes,” “plans,” “estimates,” “will,” and variations of such words and phrases or similar expressions are intended to identify such forward-looking statements. Such statements are based upon current beliefs and expectations. Forward-looking statements are not guarantees of future financial performance and are subject to risks, uncertainties and assumptions (“risk factors”) that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence. Therefore, actual results and outcomes may materially differ from what may be expressed or forecasted in such forward-looking statements. Risks factors include, without limitation, uncertainties in the Company’s preliminary review of, and additional analysis with respect to, the impact of H.R.1 on the Company’s deferred tax assets, as well as additional risks and uncertainties included in the risk factors described in Item 1A of the Company’s Annual Report on Form10-K for the year ended December31, 2016. These and other factors are representative of the risk factors that may emerge and could cause a difference between an ultimate actual outcome and a preceding forward-looking statement. The Company assumes no duty to update, amend or clarify forward-looking statements, whether as a result of new information, future events or otherwise.
About PENNS WOODS BANCORP,INC. (NASDAQ:PWOD)
Penns Woods Bancorp, Inc. is a bank holding company. The Company operates through its subsidiaries: Jersey Shore State Bank (JSSB) and Luzerne Bank (Luzerne) (collectively known as the Banks); Woods Real Estate Development Company, Inc.; Woods Investment Company, Inc., and The M Group, a subsidiary of JSSB. The Company is engaged in managing and supervising the Banks. The Company operates in Community Banking segment. The Banks are engaged in a full-service commercial banking business, making available to the community a range of financial services, including installment loans, credit cards, mortgage and home equity loans, lines of credit, construction financing, farm loans, community development loans, loans to non-profit entities and local government, and various demand and time deposits, including checking accounts, savings accounts, money market deposit accounts, certificates of deposit and individual retirement arrangements (IRAs).