Investors Title (NASDAQ:ITIC)
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J. Allen Fine, Chairman of Investors Title Company (NASDAQ:ITIC),
announced that for the third quarter ended September 30, 2006, the
Company reported net income of $3,672,069, a decrease of 15.2% compared
with $4,329,529 for the prior year period. Net income per diluted share
equaled $1.44, a decrease of 13.8% compared with $1.67 per diluted share
in the same period last year. Net premiums written decreased 13.1% to
$18,242,676 and revenues decreased 9.6% to $21,722,334 compared with the
prior year period.
For the nine-month period ended September 30, 2006, the Company reported
net income of $10,862,547, an increase of 11.2%, compared with
$9,772,021 for the same nine-month period in 2005. Diluted earnings per
share were $4.23, an increase of 13.1% compared with $3.74 for the same
nine-month period in 2005. Net premiums written decreased 7.1% to
$53,997,893 and revenues decreased 1.8% to $65,027,803 compared with the
prior year.
Premiums written declined during the latest reporting period as mortgage
originations and real estate activity continued to slow from the record
levels of the prior year. Slowing real estate sales also led to a
decline in tax-deferred exchange volume. Revenue in the exchange segment
increased due to higher rates of interest earned on funds. Also slightly
offsetting the decline in premium revenue was an increase in investment
income.
Chairman Fine added “As generally expected,
transaction volume and mortgage loan origination has continued to slow
as a result of higher interest rates, inventory imbalances and other
market factors. We continue to monitor conditions in the real estate
market in order to best align expenditures with changing activity
levels, while looking for opportunities to extend our distribution base
and further improve operating efficiencies.”
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 as well as investment management services to
individuals, trusts, foundations and businesses.
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, 2005, as filed with
the Securities and Exchange Commission.
Investors Title Company and SubsidiariesConsolidated
Statements of IncomeSeptember 30, 2006 and 2005(Unaudited)
For The Three
For The Nine
Months Ended
Months Ended
September 30
September 30
2006
2005
2006
2005
Revenues:
Underwriting income:
Premiums written
$
18,347,342
$
21,035,519
$
54,315,786
$
58,333,687
Less-premiums for reinsurance ceded
104,666
49,419
317,893
234,234
Net premiums written
18,242,676
20,986,100
53,997,893
58,099,453
Investment income-interest and dividends
1,036,155
812,659
3,064,905
2,373,983
Net realized gain (loss) on sales of investments
(55,930)
69,597
488,527
89,504
Exchange services revenue
1,604,992
1,222,602
4,541,081
3,272,034
Other
894,441
942,365
2,935,397
2,381,990
Total
21,722,334
24,033,323
65,027,803
66,216,964
Operating Expenses:
Commissions to agents
6,796,146
8,209,799
20,368,864
23,050,329
Provision for claims
1,992,901
2,283,372
5,878,592
6,354,485
Salaries, employee benefits and payroll taxes
4,901,427
4,540,061
14,824,296
14,320,940
Office occupancy and operations
1,247,299
1,133,563
3,978,654
3,722,639
Business development
568,982
591,506
1,622,145
1,483,367
Taxes, other than payroll and income
196,707
67,234
493,599
387,218
Premium and retaliatory taxes
396,851
411,084
1,067,461
1,204,399
Professional fees
554,487
370,297
1,879,643
1,461,478
Other
92,435
186,878
531,002
298,088
Total
16,747,235
17,793,794
50,644,256
52,282,943
Income Before Income Taxes
4,975,099
6,239,529
14,383,547
13,934,021
Provision For Income Taxes
1,303,030
1,910,000
3,521,000
4,162,000
Net Income
$
3,672,069
$
4,329,529
$
10,862,547
$
9,772,021
Basic Earnings Per Common Share
$
1.46
$
1.69
$
4.29
$
3.81
Weighted Average Shares Outstanding - Basic
2,517,691
2,559,154
2,534,883
2,562,247
Diluted Earnings Per Common Share
$
1.44
$
1.67
$
4.23
$
3.74
Weighted Average Shares Outstanding - Diluted
2,550,607
2,600,289
2,569,585
2,611,073
Investors Title Company and Subsidiaries
Consolidated Balance Sheets
As of September 30, 2006 and December 31, 2005
(Unaudited)
September 30, 2006
December 31, 2005
Assets
Cash and cash equivalents
$
3,957,098
$
14,608,481
Investments in securities:
Fixed maturities:
Held-to-maturity, at amortized cost
1,200,276
1,648,708
Available-for-sale, at fair value
96,677,536
75,472,342
Equity securities, available-for-sale at fair value
12,363,984
9,437,678
Short-term investments
3,000,463
7,257,734
Other investments
1,629,631
1,336,111
Total investments
114,871,890
95,152,573
Premiums and fees receivable, net
7,326,398
7,818,558
Accrued interest and dividends
1,081,266
1,010,198
Prepaid expenses and other assets
6,796,132
1,592,326
Property acquired in settlement of claims
417,800
359,980
Property, net
6,119,700
5,466,765
Deferred income taxes, net
2,011,981
2,462,647
Total Assets
$
142,582,265
$
128,471,528
Liabilities and Stockholders' Equity
Liabilities:
Reserves for claims
$
36,477,000
$
34,857,000
Accounts payable and accrued liabilities
12,758,421
7,928,384
Commissions and reinsurance payables
353,362
442,098
Current income taxes payable
126,255
946,790
Total liabilities
49,715,038
44,174,272
Stockholders' Equity:
Common stock - no par value (shares authorized 10,000,000; 2,506,784
and 2,549,434 shares issued and outstanding 2006 and 2005,
respectively, excluding 291,676 and 297,783 shares 2006 and 2005,
respectively, of common stock held by the Company's subsidiary)
1
1
Retained earnings
90,002,406
81,477,022
Accumulated other comprehensive income (net unrealized gain on
investments)
2,864,820
2,820,233
Total stockholders' equity
92,867,227
84,297,256
Total Liabilities and Stockholders' Equity
$
142,582,265
$
128,471,528
Investors Title Company and Subsidiaries
Net Premiums Written By State
September 30, 2006 and 2005
(Unaudited)
For the Three Months Ended
For the Nine Months Ended
September 30
September 30
State
2006
2005
2006
2005
Alabama
$
185,318
$
304,229
$
759,499
$
1,034,232
Florida
359,531
410,075
965,822
1,182,015
Illinois
291,810
244,111
819,718
735,441
Kentucky
618,829
616,986
1,775,866
1,601,826
Maryland
344,598
471,464
1,126,272
1,331,992
Michigan
825,711
1,229,606
2,584,541
3,614,984
Minnesota
200,469
227,850
842,538
756,642
Mississippi
225,319
249,728
526,996
811,321
Nebraska
172,005
212,204
503,451
597,899
New York
602,667
998,587
1,815,458
2,358,964
North Carolina
9,185,274
10,111,914
27,400,208
27,477,382
Pennsylvania
373,498
460,000
1,100,005
1,287,648
South Carolina
2,045,816
1,748,951
4,984,670
5,136,939
Tennessee
686,497
775,812
1,967,589
2,066,396
Virginia
1,515,282
2,078,630
5,087,324
6,032,643
West Virginia
577,884
728,273
1,673,725
1,740,338
Other States
135,101
167,099
373,945
552,979
Direct Premiums
18,345,609
21,035,519
54,307,627
58,319,641
Reinsurance Assumed
1,733
-
8,159
14,046
Reinsurance Ceded
(104,666)
(49,419)
(317,893)
(234,234)
Net Premiums Written
$
18,242,676
$
20,986,100
$
53,997,893
$
58,099,453
Investors Title Company and Subsidiaries
Net Premiums Written By Branch and Agency
September 30, 2006 and 2005
(Unaudited)
For The Three Months Ended
For The Nine Months Ended
September 30
September 30
2006
%
2005
%
2006
%
2005
%
Branch
$ 8,602,081
47
$ 9,636,878
46
$ 25,333,046
47
$ 26,017,989
45
Agency
$ 9,640,595
53
$ 11,349,222
54
$ 28,664,847
53
$ 32,081,464
55
Total
$ 18,242,676
100
$ 20,986,100
100
$ 53,997,893
100
$ 58,099,453
100
J. Allen Fine, Chairman of Investors Title Company (NASDAQ:ITIC),
announced that for the third quarter ended September 30, 2006, the
Company reported net income of $3,672,069, a decrease of 15.2%
compared with $4,329,529 for the prior year period. Net income per
diluted share equaled $1.44, a decrease of 13.8% compared with $1.67
per diluted share in the same period last year. Net premiums written
decreased 13.1% to $18,242,676 and revenues decreased 9.6% to
$21,722,334 compared with the prior year period.
For the nine-month period ended September 30, 2006, the Company
reported net income of $10,862,547, an increase of 11.2%, compared
with $9,772,021 for the same nine-month period in 2005. Diluted
earnings per share were $4.23, an increase of 13.1% compared with
$3.74 for the same nine-month period in 2005. Net premiums written
decreased 7.1% to $53,997,893 and revenues decreased 1.8% to
$65,027,803 compared with the prior year.
Premiums written declined during the latest reporting period as
mortgage originations and real estate activity continued to slow from
the record levels of the prior year. Slowing real estate sales also
led to a decline in tax-deferred exchange volume. Revenue in the
exchange segment increased due to higher rates of interest earned on
funds. Also slightly offsetting the decline in premium revenue was an
increase in investment income.
Chairman Fine added "As generally expected, transaction volume and
mortgage loan origination has continued to slow as a result of higher
interest rates, inventory imbalances and other market factors. We
continue to monitor conditions in the real estate market in order to
best align expenditures with changing activity levels, while looking
for opportunities to extend our distribution base and further improve
operating efficiencies."
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 as well as investment management
services to individuals, trusts, foundations and businesses.
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, 2005, as filed with the Securities and
Exchange Commission.
-0-
*T
Investors Title Company and Subsidiaries
Consolidated Statements of Income
September 30, 2006 and 2005
(Unaudited)
For The Three For The Nine
Months Ended Months Ended
September 30 September 30
------------------------ ------------------------
2006 2005 2006 2005
----------- ----------- ----------- -----------
Revenues:
Underwriting
income:
Premiums written $18,347,342 $21,035,519 $54,315,786 $58,333,687
Less-premiums for
reinsurance ceded 104,666 49,419 317,893 234,234
----------- ----------- ----------- -----------
Net premiums
written 18,242,676 20,986,100 53,997,893 58,099,453
Investment income-
interest and
dividends 1,036,155 812,659 3,064,905 2,373,983
Net realized gain
(loss) on sales
of investments (55,930) 69,597 488,527 89,504
Exchange services
revenue 1,604,992 1,222,602 4,541,081 3,272,034
Other 894,441 942,365 2,935,397 2,381,990
----------- ----------- ----------- -----------
Total 21,722,334 24,033,323 65,027,803 66,216,964
----------- ----------- ----------- -----------
Operating Expenses:
Commissions to
agents 6,796,146 8,209,799 20,368,864 23,050,329
Provision for
claims 1,992,901 2,283,372 5,878,592 6,354,485
Salaries, employee
benefits and
payroll taxes 4,901,427 4,540,061 14,824,296 14,320,940
Office occupancy
and operations 1,247,299 1,133,563 3,978,654 3,722,639
Business
development 568,982 591,506 1,622,145 1,483,367
Taxes, other than
payroll and
income 196,707 67,234 493,599 387,218
Premium and
retaliatory taxes 396,851 411,084 1,067,461 1,204,399
Professional fees 554,487 370,297 1,879,643 1,461,478
Other 92,435 186,878 531,002 298,088
----------- ----------- ----------- -----------
Total 16,747,235 17,793,794 50,644,256 52,282,943
----------- ----------- ----------- -----------
Income Before
Income Taxes 4,975,099 6,239,529 14,383,547 13,934,021
----------- ----------- ----------- -----------
Provision For
Income Taxes 1,303,030 1,910,000 3,521,000 4,162,000
----------- ----------- ----------- -----------
Net Income $ 3,672,069 $ 4,329,529 $10,862,547 $ 9,772,021
=========== =========== =========== ===========
Basic Earnings Per
Common Share $ 1.46 $ 1.69 $ 4.29 $ 3.81
=========== =========== =========== ===========
Weighted Average
Shares Outstanding
- Basic 2,517,691 2,559,154 2,534,883 2,562,247
=========== =========== =========== ===========
Diluted Earnings
Per Common Share $ 1.44 $ 1.67 $ 4.23 $ 3.74
=========== =========== =========== ===========
Weighted Average
Shares Outstanding
- Diluted 2,550,607 2,600,289 2,569,585 2,611,073
=========== =========== =========== ===========
*T
-0-
*T
Investors Title Company and Subsidiaries
Consolidated Balance Sheets
As of September 30, 2006 and December 31, 2005
(Unaudited)
September 30, December 31,
2006 2005
-------------- ------------
Assets
Cash and cash equivalents $ 3,957,098 $ 14,608,481
Investments in securities:
Fixed maturities:
Held-to-maturity, at amortized
cost 1,200,276 1,648,708
Available-for-sale, at fair value 96,677,536 75,472,342
Equity securities, available-for-
sale at fair value 12,363,984 9,437,678
Short-term investments 3,000,463 7,257,734
Other investments 1,629,631 1,336,111
-------------- ------------
Total investments 114,871,890 95,152,573
Premiums and fees receivable, net 7,326,398 7,818,558
Accrued interest and dividends 1,081,266 1,010,198
Prepaid expenses and other assets 6,796,132 1,592,326
Property acquired in settlement of
claims 417,800 359,980
Property, net 6,119,700 5,466,765
Deferred income taxes, net 2,011,981 2,462,647
-------------- ------------
Total Assets $ 142,582,265 $128,471,528
============== ============
Liabilities and Stockholders' Equity
Liabilities:
Reserves for claims $ 36,477,000 $ 34,857,000
Accounts payable and accrued
liabilities 12,758,421 7,928,384
Commissions and reinsurance payables 353,362 442,098
Current income taxes payable 126,255 946,790
-------------- ------------
Total liabilities 49,715,038 44,174,272
-------------- ------------
Stockholders' Equity:
Common stock - no par value (shares
authorized 10,000,000; 2,506,784 and
2,549,434 shares issued and outstanding
2006 and 2005, respectively, excluding
291,676 and 297,783 shares 2006 and
2005, respectively, of common stock
held by the Company's subsidiary) 1 1
Retained earnings 90,002,406 81,477,022
Accumulated other comprehensive income
(net unrealized gain on investments) 2,864,820 2,820,233
-------------- ------------
Total stockholders' equity 92,867,227 84,297,256
-------------- ------------
Total Liabilities and Stockholders'
Equity $ 142,582,265 $128,471,528
============== ============
*T
-0-
*T
Investors Title Company and Subsidiaries
Net Premiums Written By State
September 30, 2006 and 2005
(Unaudited)
For the Three Months For the Nine Months
Ended Ended
September 30 September 30
----------------------- -----------------------
State 2006 2005 2006 2005
---------------------------------------------- -----------------------
Alabama $ 185,318 $ 304,229 $ 759,499 $ 1,034,232
Florida 359,531 410,075 965,822 1,182,015
Illinois 291,810 244,111 819,718 735,441
Kentucky 618,829 616,986 1,775,866 1,601,826
Maryland 344,598 471,464 1,126,272 1,331,992
Michigan 825,711 1,229,606 2,584,541 3,614,984
Minnesota 200,469 227,850 842,538 756,642
Mississippi 225,319 249,728 526,996 811,321
Nebraska 172,005 212,204 503,451 597,899
New York 602,667 998,587 1,815,458 2,358,964
North Carolina 9,185,274 10,111,914 27,400,208 27,477,382
Pennsylvania 373,498 460,000 1,100,005 1,287,648
South Carolina 2,045,816 1,748,951 4,984,670 5,136,939
Tennessee 686,497 775,812 1,967,589 2,066,396
Virginia 1,515,282 2,078,630 5,087,324 6,032,643
West Virginia 577,884 728,273 1,673,725 1,740,338
Other States 135,101 167,099 373,945 552,979
----------- ----------- ----------- -----------
Direct Premiums 18,345,609 21,035,519 54,307,627 58,319,641
Reinsurance Assumed 1,733 - 8,159 14,046
Reinsurance Ceded (104,666) (49,419) (317,893) (234,234)
----------- ----------- ----------- -----------
Net Premiums Written $18,242,676 $20,986,100 $53,997,893 $58,099,453
=========== =========== =========== ===========
*T
-0-
*T
Investors Title Company and Subsidiaries
Net Premiums Written By Branch and Agency
September 30, 2006 and 2005
(Unaudited)
For The Three Months Ended
September 30
-------------------------------------------------------
2006 % 2005 %
-------------------------------------------------------
Branch $8,602,081 47 $9,636,878 46
Agency $9,640,595 53 $11,349,222 54
-------------------------------------------------------
Total $18,242,676 100 $20,986,100 100
=======================================================
Investors Title Company and Subsidiaries
Net Premiums Written By Branch and Agency
September 30, 2006 and 2005
(Unaudited)
For The Nine Months Ended
September 30
--------------------------------------------------------
2006 % 2005 %
--------------------------------------------------------
Branch $25,333,046 47 $26,017,989 45
Agency $28,664,847 53 $32,081,464 55
--------------------------------------------------------
Total $53,997,893 100 $58,099,453 100
========================================================
*T