CHAPEL HILL, N.C., Aug. 7, 2007 (PRIME NEWSWIRE) -- J. Allen Fine, Chairman of Investors Title Company (Nasdaq:ITIC), announced that for the second quarter ended June 30, 2007, the Company reported net income of $1,154,149, a decrease of 73.3% compared with $4,315,537 for the same three-month period in 2006. Net income per diluted share equaled $0.46, a decrease of 72.6% compared with $1.68 per diluted share in the same period last year. Net premiums written decreased 2.6% to $18,626,179, investment income increased 22.9% to $1,271,755 and revenues decreased 4.4% to $22,107,533 compared with the prior year period.
For the six-month period ended June 30, 2007, the Company reported net income of $3,476,363, a decrease of 51.7%, compared with $7,190,478 for the same six-month period in 2006. Diluted earnings per share were $1.38, a decrease of 50.5% compared with $2.79 for the same six-month ended period in 2006. Net premiums written decreased 0.9% to $35,418,721, investment income increased 22.3% to $2,481,362 and revenues decreased 2.0% to $42,441,302 compared with the prior year.
Chairman Fine added, "Net income was significantly impacted by an increase in the provision for claims resulting from the occurrence of two large fraud claims. Revenues in the title segment held up relatively well given ongoing weakness in real estate transaction volume and mortgage originations. The exchange services segment experienced a decline in revenue related to a decrease in demand and interest income earned on exchange funds. Commissions to agents were higher due to an increase in agency premiums."
"We are pleased to see some relative strength in revenue in our title segment given the soft conditions in the housing market," Fine continued, "and will continue to direct our efforts toward managing operations during a softening period for real estate activity."
Investors Title Company is engaged through its subsidiaries in the business of issuing and underwriting title insurance policies. The Company also provides services in connection with tax-deferred exchanges of like-kind property and investment management services to individuals, companies, banks and trusts.
The Investors Title Company logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=3951
Certain statements contained herein may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include any predictions regarding activity in the U.S. real estate market. These statements involve a number of risks and uncertainties that could cause actual results to differ materially from anticipated and historical results. For more details on risk, uncertainties and other factors that could affect expectations, refer to the Company's Annual Report on Form 10-K for the year ended December 31, 2006, as filed with the Securities and Exchange Commission.
Investors Title Company and Subsidiaries Consolidated Statements of Income June 30, 2007 and 2006 (Unaudited) For The Three For The Six Months Ended Months Ended June 30 June 30 ------------------------ ------------------------ 2007 2006 2007 2006 ---- ---- ---- ---- Revenues: Underwriting income: Premiums Written $18,715,760 $19,222,175 $35,590,737 $35,968,444 Less-premiums for reinsurance ceded 89,581 98,584 172,016 213,227 ----------- ----------- ----------- ----------- Net premiums written 18,626,179 19,123,591 35,418,721 35,755,217 Investment income-interest and dividends 1,271,755 1,034,696 2,481,362 2,028,750 Net realized gain (loss) on sales of investments 200,023 (17,190) 366,203 544,457 Exchange services revenue 870,083 1,908,357 2,115,562 2,936,089 Other 1,139,493 1,077,167 2,059,454 2,040,956 ----------- ----------- ----------- ----------- Total Revenues 22,107,533 23,126,621 42,441,302 43,305,469 ----------- ----------- ----------- ----------- Operating Expenses: Commissions to agents 7,733,004 7,289,322 14,578,292 13,572,718 Provision for claims 4,352,005 2,030,412 6,161,438 3,885,691 Salaries, employee benefits and payroll taxes 5,091,139 4,917,022 10,365,514 9,922,869 Office occupancy and operations 1,452,901 1,266,042 2,889,024 2,731,355 Business development 556,734 547,505 1,079,916 1,053,163 Filing fees and taxes, other than payroll and income 126,455 142,850 291,668 293,708 Premium and retaliatory taxes 395,262 328,542 837,182 670,610 Professional and contract labor fees 826,140 737,534 1,471,150 1,325,156 Other 278,744 222,885 500,755 441,751 ----------- ----------- ----------- ----------- Total Operating Expenses 20,812,384 17,482,114 38,174,939 33,897,021 ----------- ----------- ----------- ----------- Income Before Income Taxes 1,295,149 5,644,507 4,266,363 9,408,448 ----------- ----------- ----------- ----------- Provision For Income Taxes 141,000 1,328,970 790,000 2,217,970 ----------- ----------- ----------- ----------- Net Income $ 1,154,149 $ 4,315,537 $ 3,476,363 $ 7,190,478 =========== =========== =========== =========== Basic Earnings Per Common Share $ 0.46 $ 1.70 $ 1.40 $ 2.83 =========== =========== =========== =========== Weighted Average Shares Outstanding - Basic 2,484,874 2,537,883 2,491,955 2,543,475 =========== =========== =========== =========== Diluted Earnings Per Common Share $ 0.46 $ 1.68 $ 1.38 $ 2.79 =========== =========== =========== =========== Weighted Average Shares Outstanding - Diluted 2,518,206 2,572,062 2,526,844 2,578,743 =========== =========== =========== =========== Investors Title Company and Subsidiaries Consolidated Balance Sheets As of June 30, 2007 and December 31, 2006 (Unaudited) June 30, December 31, 2007 2006 ------------ ------------ Assets Investments in securities: Fixed maturities: Held-to-maturity, at amortized cost $ 1,194,304 $ 1,195,617 Available-for-sale, at fair value 105,281,130 101,954,292 Equity securities, available-for-sale at fair value 13,492,236 12,495,923 Short-term investments 1,733,603 4,460,911 Other investments 1,736,647 1,473,303 ------------ ------------ Total investments 123,437,920 121,580,046 Cash and cash equivalents 3,169,702 3,458,432 Premiums and fees receivable, net 7,901,074 6,693,706 Accrued interest and dividends 1,303,050 1,336,790 Prepaid expenses and other assets 1,554,422 1,479,366 Property acquired in settlement of claims 312,038 303,538 Property, net 5,650,209 6,134,304 Deferred income taxes, net 3,388,953 2,530,196 ------------ ------------ Total Assets $146,717,368 $143,516,378 ============ ============ Liabilities and Stockholders' Equity Liabilities: Reserves for claims $ 40,560,000 $ 36,906,000 Accounts payable and accrued liabilities 9,062,960 10,537,992 Commissions and reinsurance payables 277,052 470,468 Current income taxes payable 185,879 326,255 ------------ ------------ Total liabilities 50,085,891 48,240,715 ------------ ------------ Stockholders' Equity: Common stock - no par value (shares authorized 10,000,000; 2,483,415 and 2,507,325 shares issued and outstanding 2007 and 2006, respectively, excluding 291,676 shares for 2007 and 2006 of common stock held by the Company's subsidiary) 1 1 Retained earnings 93,960,059 92,134,608 Accumulated other comprehensive income 2,671,417 3,141,054 ------------ ------------ Total stockholders' equity 96,631,477 95,275,663 ------------ ------------ Total Liabilities and Stockholders' Equity $146,717,368 $143,516,378 ============ ============ Investors Title Company and Subsidiaries Net Premiums Written By State June 30, 2007 and 2006 (Unaudited) For the Three Months For the Six Months Ended Ended June 30 June 30 ------------------------ ------------------------ State 2007 2006 2007 2006 ------------------------------------------ ------------------------- Alabama $ 151,318 $ 330,545 $ 290,678 $ 574,181 Florida 461,498 327,956 1,290,045 606,291 Illinois 460,531 280,013 849,488 527,908 Kentucky 675,454 583,539 1,225,144 1,157,037 Maryland 310,321 407,905 597,192 781,674 Michigan 798,861 881,521 1,578,186 1,758,830 Minnesota 150,535 304,900 269,217 642,069 Mississippi 271,235 167,225 535,077 301,677 Nebraska 203,768 197,136 377,092 331,446 New York 658,675 709,195 1,165,434 1,212,791 North Carolina 9,218,284 9,773,452 17,131,757 18,214,934 Pennsylvania 406,236 410,595 732,890 726,507 South Carolina 1,857,204 1,536,781 3,573,604 2,938,854 Tennessee 732,461 614,769 1,381,851 1,281,092 Virginia 1,572,652 1,897,939 3,133,156 3,572,042 West Virginia 545,827 640,423 1,013,752 1,095,841 Other 236,163 158,281 434,507 238,844 ----------- ----------- ----------- ----------- Direct Premiums 18,711,023 19,222,175 35,579,070 35,962,018 Reinsurance Assumed 4,737 -- 11,667 6,426 Reinsurance Ceded (89,581) (98,584) (172,016) (213,227) ----------- ----------- ----------- ----------- Net Premiums Written $18,626,179 $19,123,591 $35,418,721 $35,755,217 =========== =========== =========== =========== Investors Title Company and Subsidiaries Net Premiums Written By Branch and Agency June 30, 2007 and 2006 (Unaudited) For The Three Months Ended For The Six Months Ended June 30 June 30 ------------------------------- -------------------------------- 2007 % 2006 % 2007 % 2006 % ------------------------------- -------------------------------- Branch $ 7,907,600 42 $ 9,004,581 47 $15,040,911 42 $16,730,965 47 Agency 10,718,579 58 10,119,010 53 20,377,810 58 19,024,252 53 ------------------------------- -------------------------------- Total $18,626,179 100 $19,123,591 100 $35,418,721 100 $35,755,217 100 =============================== ================================