CHAPEL HILL, N.C., March 6, 2008 (PRIME NEWSWIRE) -- J. Allen Fine, Chairman of Investors Title Company (Nasdaq:ITIC), announced its results for the quarter and year ended December 31, 2007. For the fourth quarter ended December 31, 2007, the Company reported net income of $1,068,080, a decrease of 54.0% compared with $2,322,887 for the same three-month period in 2006. Net income per diluted share decreased 52.7% to $0.43 from $0.91 per diluted share in the same period last year. Net premiums written decreased 3.9% to $15,570,815, investment income increased 12.1% to $1,413,938 and revenues decreased 1.0% to $19,442,002 compared with the prior year period.
For the year ended December 31, 2007, the Company reported net income of $8,402,335, a decrease of 36.3%, compared with $13,185,434 for the same period in 2006. Diluted earnings per share were $3.35, a decrease of 34.8% compared with $5.14 for the same period in 2006. Net premiums written decreased 0.3% to $69,983,989, investment income increased 20.1% to $5,197,178 and revenues increased 0.3% to $84,942,287 compared with the prior year.
For the quarter, total revenues and operating expenses remained relatively flat compared with the same period for 2006. Total revenues declined about 1.0% while operating expenses increased by 0.8%. Increases in investment and miscellaneous revenue offset declines in premiums written and exchange services revenue.
Net income for the fourth quarter declined primarily because of an increase in the provision for income taxes relating to a re-classification in the fourth quarter of certain taxable municipal bonds that had been misclassified as tax-exempt by the Company's custodian bank. The increase in income taxes consisted of approximately $425,000 relating to the 2006 tax year and approximately $325,000 relating to the first three quarters of 2007.
During the quarter, the Company repurchased 72,009 shares of its common stock and has authority remaining to repurchase an additional 235,336 shares. For the year ended December 31, 2007, the Company repurchased 111,437 shares of common stock.
President Fine added, "Overall we are pleased with the Company's net income for the year given the challenging operating environment resulting from declining real estate activity and increasing claims experience industry-wide. We continue to be watchful over controllable expenditures and for opportunities to minimize fraud related claims exposure."
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
December 31, 2007 and 2006
(Unaudited)
For The Three For The Twelve
Months Ended Months Ended
December 31 December 31
----------------------- -----------------------
2007 2006 2007 2006
----------- ----------- ----------- -----------
Revenues:
Underwriting income:
Premiums written $15,622,242 $16,322,263 $70,248,166 $70,638,049
Less-premiums for
reinsurance ceded 51,427 123,689 264,177 441,582
----------- ----------- ----------- -----------
Net premiums
written 15,570,815 16,198,574 69,983,989 70,196,467
Investment income-
interest and
dividends 1,413,938 1,261,430 5,197,178 4,326,335
Net realized gain
on sales of
investments 34,660 62,531 921,871 551,058
Exchange services
revenue 1,182,189 1,438,946 4,340,062 5,980,027
Other 1,240,400 672,432 4,499,187 3,607,829
----------- ----------- ----------- -----------
Total Revenues 19,442,002 19,633,913 84,942,287 84,661,716
----------- ----------- ----------- -----------
Operating Expenses:
Commissions to agents 6,386,094 6,345,920 28,424,960 26,714,784
Provision for claims 1,609,440 1,526,619 10,134,719 7,405,211
Salaries, employee
benefits and
payroll taxes 5,317,243 5,170,770 20,819,094 20,036,079
Office occupancy and
operations 1,417,710 1,681,585 5,590,827 5,599,382
Business development 625,540 666,694 2,183,853 2,247,826
Filing fees and taxes,
other than payroll
and income 62,192 83,049 531,777 573,395
Premium and
retaliatory taxes 317,516 281,389 1,496,448 1,348,850
Professional and
contract labor fees 712,420 754,305 2,789,878 2,659,238
Other 378,767 177,695 1,146,396 747,517
----------- ----------- ----------- -----------
Total Operating
Expenses 16,826,922 16,688,026 73,117,952 67,332,282
----------- ----------- ----------- -----------
Income Before
Income Taxes 2,615,080 2,945,887 11,824,335 17,329,434
----------- ----------- ----------- -----------
Provision For
Income Taxes 1,547,000 623,000 3,422,000 4,144,000
----------- ----------- ----------- -----------
Net Income $ 1,068,080 $ 2,322,887 $ 8,402,335 $13,185,434
=========== =========== =========== ===========
Basic Earnings Per
Common Share $ 0.44 $ 0.93 $ 3.39 $ 5.22
=========== =========== =========== ===========
Weighted Average
Shares Outstanding
- Basic 2,452,416 2,507,062 2,479,321 2,527,927
=========== =========== =========== ===========
Diluted Earnings Per
Common Share $ 0.43 $ 0.91 $ 3.35 $ 5.14
=========== =========== =========== ===========
Weighted Average
Shares Outstanding
- Diluted 2,473,049 2,546,638 2,508,609 2,564,216
=========== =========== =========== ===========
Investors Title Company and Subsidiaries
Consolidated Balance Sheets
As of December 31, 2007 and 2006
(Unaudited)
December 31,
----------------------------
2007 2006
------------ ------------
Assets
Investments in securities:
Fixed maturities:
Held-to-maturity, at amortized cost $ 1,052,535 $ 1,195,617
Available-for-sale, at fair value 90,530,946 101,954,292
Equity securities, available-for-sale
at fair value 14,586,066 12,495,923
Short-term investments 21,222,533 4,460,911
Other investments 1,634,301 1,473,303
------------ ------------
Total investments 129,026,381 121,580,046
Cash and cash equivalents 3,000,762 3,458,432
Premiums and fees receivable, net 6,900,968 6,693,706
Accrued interest and dividends 1,254,641 1,336,790
Prepaid expenses and other assets 1,276,806 1,479,366
Property acquired in settlement
of claims 278,476 303,538
Property, net 5,278,891 6,134,304
Deferred income taxes, net 2,625,495 2,530,196
------------ ------------
Total Assets $149,642,420 $143,516,378
============ ============
Liabilities and Stockholders' Equity
Liabilities:
Reserves for claims $ 36,975,000 $ 36,906,000
Accounts payable and accrued liabilities 11,236,781 10,537,992
Commissions and reinsurance payables 406,922 470,468
Current income taxes payable 1,747,877 326,255
------------ ------------
Total liabilities 50,366,580 48,240,715
------------ ------------
Stockholders' Equity:
Common stock - no par value (shares
authorized 10,000,000; 2,411,318 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 95,739,827 92,134,608
Accumulated other comprehensive income 3,536,012 3,141,054
------------ ------------
Total stockholders' equity 99,275,840 95,275,663
------------ ------------
Total Liabilities and
Stockholders' Equity $149,642,420 $143,516,378
============ ============
Investors Title Company and Subsidiaries
Net Premiums Written By State
December 31, 2007 and 2006
(Unaudited)
For the Three Months For the Twelve Months
Ended Ended
December 31 December 31
------------------------ ------------------------
State 2007 2006 2007 2006
-------------- ----------- ----------- ----------- -----------
Illinois $ 372,152 $ 296,172 $ 1,653,518 $ 1,115,890
Kentucky 683,496 516,328 2,563,039 2,292,194
Maryland 230,373 406,643 1,167,576 1,532,915
Michigan 723,256 904,443 3,073,006 3,488,984
New York 605,560 621,105 2,412,625 2,436,563
North Carolina 7,678,826 7,800,561 34,544,366 35,200,769
Pennsylvania 370,792 372,610 1,512,745 1,472,615
South Carolina 1,886,231 2,193,201 7,637,330 7,177,871
Tennessee 565,678 499,367 2,599,686 2,466,956
Virginia 1,274,943 1,647,374 6,121,746 6,734,698
West Virginia 484,318 458,605 2,029,885 2,132,330
Other States 715,468 591,855 4,889,828 4,564,106
----------- ----------- ----------- -----------
Direct
Premiums 15,591,093 16,308,264 70,205,350 70,615,891
Reinsurance
Assumed 31,149 13,999 42,816 22,158
Reinsurance
Ceded (51,427) (123,689) (264,177) (441,582)
----------- ----------- ----------- -----------
Net Premiums
Written $15,570,815 $16,198,574 $69,983,989 $70,196,467
=========== =========== =========== ===========
Investors Title Company and Subsidiaries
Net Premiums Written By Branch and Agency
December 31, 2007 and 2006
(Unaudited)
For The Three Months Ended
December 31
---------------------------------------------------------
2007 % 2006 %
---------------------------------------------------------
Branch $ 6,736,650 43 $ 7,033,319 43
Agency 8,834,165 57 9,165,255 57
---------------------------------------------------------
Total $ 15,570,815 100 $ 16,198,574 100
=========================================================
For The Twelve Months Ended
December 31
---------------------------------------------------------
2007 % 2006 %
---------------------------------------------------------
Branch $ 30,088,420 43 $ 32,366,365 46
Agency 39,895,569 57 37,830,102 54
---------------------------------------------------------
Total $ 69,983,989 100 $ 70,196,467 100
=========================================================