EX-99.1 3 a5395466ex991.txt EXHIBIT 99.1 Exhibit 99.1 Investors Title Company Announces First Quarter 2007 Results CHAPEL HILL, N.C.--(BUSINESS WIRE)--May 4, 2007--J. Allen Fine, Chairman of Investors Title Company (NASDAQ: ITIC), announced that for the quarter ended March 31, 2007, the Company reported net income of $2,322,214, a decrease of 19% compared with $2,874,941 for the prior year period. Net income per diluted share equaled $0.92, a decrease of 17% compared with $1.11 per diluted share in the same period last year. Net premiums written increased 1% to $16,792,542 and revenues increased 1% to $20,333,769 compared with the prior year period. Revenues slightly exceeded the prior year period primarily due to an increase in investment income and to a lesser extent, an increase in net premiums written. Income in the exchange segment also increased principally due to an increase in interest earned on exchange funds. Profit margins and net income declined due to a decrease in the net realized gain on sales of investments and a 6% increase in operating expenses. The increase in operating expenses was primarily the result of an increase in commissions to agents due to an increase in agent premiums. Also contributing to the increase in operating expenses was a small overall increase in salaries and employee benefits. Chairman Fine added, "Overall, we are pleased with our results for the quarter, which is typically a seasonally slow period of the year. We remain focused on identifying opportunities to extend our distribution base, operate more efficiently and expand our business lines." 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. 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 March 31, 2007 and 2006 (Unaudited) For The Three Months Ended March 31 ----------------------- 2007 2006 ----------- ----------- Revenues: Underwriting income: Premiums Written $16,874,977 $16,746,269 Less-premiums for reinsurance ceded 82,435 114,643 ----------- ----------- Net premiums written 16,792,542 16,631,626 Investment income-interest and dividends 1,209,607 994,054 Net realized gain on sales of investments 166,180 561,647 Exchange services revenue 1,245,479 1,027,732 Other 919,961 963,789 ----------- ----------- Total Revenues 20,333,769 20,178,848 ----------- ----------- Operating Expenses: Commissions to agents 6,845,288 6,283,396 Provision for claims 1,809,433 1,855,279 Salaries, employee benefits and payroll taxes 5,274,375 5,005,847 Office occupancy and operations 1,436,123 1,465,313 Business development 523,182 505,658 Filing fees and taxes, other than payroll and income 165,213 150,858 Premium and retaliatory taxes 441,920 342,068 Professional and contract labor fees 645,010 587,622 Other 222,011 218,866 ` ----------- ----------- Total Operating Expenses 17,362,555 16,414,907 ----------- ----------- Income Before Income Taxes 2,971,214 3,763,941 ----------- ----------- Provision For Income Taxes 649,000 889,000 ----------- ----------- Net Income $ 2,322,214 $ 2,874,941 =========== =========== Basic Earnings Per Common Share $ 0.93 $ 1.13 =========== =========== Weighted Average Shares Outstanding - Basic 2,499,035 2,549,070 =========== =========== Diluted Earnings Per Common Share $ 0.92 $ 1.11 =========== =========== Weighted Average Shares Outstanding - Diluted 2,535,858 2,586,465 =========== =========== Investors Title Company and Subsidiaries Consolidated Balance Sheets As of March 31, 2007 and December 31, 2006 (Unaudited) March 31, Dec. 31, 2007 2006 ------------------------- Assets Investments in securities: Fixed maturities: Held-to-maturity, at amortized cost $ 1,193,959 $ 1,195,617 Available-for-sale, at fair value 104,236,975 101,954,292 Equity securities, available-for-sale at fair value 12,677,136 12,495,923 Short-term investments 2,122,879 4,460,911 Other investments 1,623,036 1,473,303 ------------ ------------ Total investments 121,853,985 121,580,046 Cash and cash equivalents 3,414,489 3,458,432 Premiums and fees receivable, net 6,792,739 6,693,706 Accrued interest and dividends 1,204,662 1,336,790 Prepaid expenses and other assets 1,692,953 1,479,366 Property acquired in settlement of claims 303,538 303,538 Property, net 5,910,789 6,134,304 Deferred income taxes, net 2,308,436 2,530,196 ------------ ------------ Total Assets $143,481,591 $143,516,378 ============ ============ Liabilities and Stockholders' Equity Liabilities: Reserves for claims $ 37,133,000 $ 36,906,000 Accounts payable and accrued liabilities 9,522,465 10,537,992 Commissions and reinsurance payables 242,617 470,468 Current income taxes payable 333,704 326,255 ------------ ------------ Total liabilities 47,231,786 48,240,715 ------------ ------------ Stockholders' Equity: Common stock - no par value (shares authorized 10,000,000; 2,486,352 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 93,213,418 92,134,608 Accumulated other comprehensive income 3,036,386 3,141,054 ------------ ------------ Total stockholders' equity 96,249,805 95,275,663 ------------ ------------ Total Liabilities and Stockholders' Equity $143,481,591 $143,516,378 ============ ============ Investors Title Company and Subsidiaries Net Premiums Written By State For the Three Months Ended March 31, 2007 and 2006 (Unaudited) 2007 2006 ---------------------------------------------------------------------- Alabama $ 139,360 $ 243,636 Florida 828,547 278,335 Illinois 388,957 247,895 Kentucky 549,690 573,498 Maryland 286,871 373,769 Michigan 779,325 877,309 Minnesota 118,682 337,169 Mississippi 263,842 134,452 Nebraska 173,324 134,310 New York 506,759 503,596 North Carolina 7,913,473 8,441,482 Pennsylvania 326,654 315,912 South Carolina 1,716,400 1,402,073 Tennessee 649,390 666,323 Virginia 1,560,504 1,674,103 West Virginia 467,925 455,418 Other States 198,344 80,563 ----------- ----------- Direct Premiums 16,868,047 16,739,843 Reinsurance Assumed 6,930 6,426 Reinsurance Ceded (82,435) (114,643) ----------- ----------- Net Premiums Written $16,792,542 $16,631,626 =========== =========== Investors Title Company and Subsidiaries Net Premiums Written By Branch and Agency March 31, 2007 and 2006 (Unaudited) For The Three Months Ended March 31 --------------------------------------------------- 2007 % 2006 % --------------------------------------------------- Branch $ 7,133,311 42 $ 7,727,025 46 Agency 9,659,231 58 8,904,601 54 --------------------------------------------------- Total $16,792,542 100 $16,631,626 100 =================================================== CONTACT: Investors Title Company Elizabeth B. Lewter, 919-968-2200