Investors Title (ITIC) 8-K Investors Title Company Announces Fourth Quarter and Fiscal Year 2011 Results

Exhibit 99.1

Investors Title Company Announces Fourth Quarter and Fiscal Year 2011 Results

CHAPEL HILL, N.C.--(BUSINESS WIRE)--February 23, 2012--Investors Title Company today announced its results for the fourth quarter and year ended December 31, 2011. For the quarter, net income decreased 20.6% to $1,879,459, or $0.88 per diluted share, compared with $2,368,550, or $1.04 per diluted share, for the prior year period. For the year, net income increased 8.8% to $6,933,936, or $3.20 per diluted share, compared with $6,372,626, or $2.78 per diluted share, for the prior year.

The decrease in net income for the quarter was driven primarily by lower premium volumes, partially offset by lower operating expenses and a reduction in the effective income tax rate. Operating expenses decreased 2.5% to $18,174,594 versus the prior year period due both to lower levels of variable expenses which follow premiums as well as reductions in certain overhead expenses.

The increase in net income for the year was driven primarily by premium revenue growth and favorable claims experience. Net premiums written increased 32.6% to $81,529,333 versus the prior year, mainly as a result of the Company’s expansion into Texas in late 2010. Operating expenses increased 29.5% to $81,186,220 versus the prior year period, primarily due to an increase in commissions to agents and other expenses which fluctuate with revenues. Commissions to agents increased 59.0%, commensurate with the growth in agency premiums and reflective of an increase in agent business from markets with higher premium rates, primarily Texas. The provision for claims as a percentage of net premiums written was lower compared with the prior year due to an adjustment for favorable loss development in prior policy years, as well as a decline in the relative share of North Carolina business as a percentage of the total versus the prior year period. Since North Carolina’s premium rates are less than half the national average, the resulting loss ratio for North Carolina business is higher than for our other markets.

Chairman J. Allen Fine added, “We are pleased to report a substantial improvement in operating results for 2011. Although we did experience a slowdown in the fourth quarter, premiums written for the year increased 32.6% versus last year largely due to our expansion into Texas. Operating expenses in total increased 29.5%; however, we continued to see year-over-year improvement in our claims loss rate as well as reductions in other operating expense categories which do not fluctuate directly with premium levels. Our balance sheet and financial condition remain very strong, and in the coming year we plan to continue to enhance our competitive strengths and market position by emphasizing the expansion of our agency base and operational efficiency.”

Investors Title Company is engaged through its subsidiaries in the business of issuing and underwriting title insurance policies. The Company also provides investment management services to individuals, companies, banks and trusts, as well as services in connection with tax-deferred exchanges of like-kind property.

Certain statements contained herein may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, among other statements, any predictions regarding future agency base expansion or increasing operational efficiency. These statements involve a number of risks and uncertainties that could cause actual results to differ materially from anticipated and historical results. Such risks and uncertainties include, without limitation: the cyclical demand for title insurance due to changes in the residential and commercial real estate markets; the occurrence of fraud, defalcation or misconduct; variances between actual claims experience and underwriting and reserving assumptions; declines in the performance of the Company’s investments; government regulation; and other considerations set forth under the caption “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010, as filed with the Securities and Exchange Commission, and in subsequent filings.

Investors Title Company and Subsidiaries
Consolidated Statements of Income
For the Three and Twelve Months Ended December 31, 2011 and 2010
(Unaudited)
		Three Months Ended				Twelve Months Ended
		December 31				December 31
		2011		2010		2011		2010
Revenues:
Net premiums written	$	18,226,131	$	19,287,794	$	81,529,333	$	61,462,441
Investment income - interest and dividends		929,791		913,950		3,595,036		3,671,178
Net realized gain on investments		107,731		348,608		28,559		654,674
Other		1,563,400		1,681,142		5,532,228		5,521,062
Total Revenues		20,827,053		22,231,494		90,685,156		71,309,355
Operating Expenses:
Commissions to agents		10,261,013		10,481,297		49,596,250		31,189,207
Provision for claims		1,041,168		1,190,725		3,342,427		4,435,066
Salaries, employee benefits and payroll taxes		4,442,291		4,510,829		18,552,504		17,695,956
Office occupancy and operations		886,735		897,072		3,722,803		3,935,563
Business development		583,317		582,473		1,706,834		1,544,588
Filing fees, franchise and local taxes		104,483		38,602		516,380		573,075
Premium and retaliatory taxes		361,662		359,745		1,729,830		1,279,400
Professional and contract labor fees		381,158		472,438		1,513,466		1,511,283
Other		112,767		108,763		505,726		529,591
Total Operating Expenses		18,174,594		18,641,944		81,186,220		62,693,729
Income Before Income Taxes		2,652,459		3,589,550		9,498,936		8,615,626
Provision For Income Taxes		773,000		1,221,000		2,565,000		2,243,000
Net Income	$	1,879,459	$	2,368,550	$	6,933,936	$	6,372,626
Basic Earnings Per Common Share	$	0.89	$	1.04	$	3.22	$	2.79
Weighted Average Shares Outstanding - Basic		2,112,675		2,283,513		2,151,350		2,284,657
Diluted Earnings Per Common Share	$	0.88	$	1.04	$	3.20	$	2.78
Weighted Average Shares Outstanding - Diluted		2,132,780		2,287,201		2,169,636		2,289,847

Investors Title Company and Subsidiaries
Consolidated Balance Sheets
As of December 31, 2011 and 2010
(Unaudited)
		December 31, 2011		December 31, 2010
Assets:
Investments in securities:
Fixed maturities, available-for-sale, at fair value	$	85,407,365	$	86,033,557
Equity securities, available-for-sale, at fair value		22,549,975		13,872,370
Short-term investments		14,112,262		27,203,550
Other investments		3,631,714		2,888,958
Total investments		125,701,316		129,998,435
Cash and cash equivalents		18,042,258		8,117,031
Premiums and fees receivable, net		6,810,000		7,253,786
Accrued interest and dividends		1,108,156		1,150,602
Prepaid expenses and other assets		2,743,517		2,816,661
Property, net		3,553,216		3,672,317
Deferred income taxes, net		-		476,534
Total Assets	$	157,958,463	$	153,485,366
Liabilities and Stockholders' Equity
Liabilities:
Reserves for claims	$	37,996,000	$	38,198,700
Accounts payable and accrued liabilities		12,330,383		10,301,495
Current income taxes payable		640,533		1,056,356
Deferred income taxes, net		479,363		-
Total liabilities		51,446,279		49,556,551
Stockholders' Equity:
Common stock - no par value (shares authorized 10,000,000; 2,107,681 and 2,282,596 shares issued and outstanding as of December 31, 2011 and 2010, respectively, excluding 291,676 shares for 2011 and 2010 of common stock held by the Company's subsidiary)		1		1
Retained earnings		99,003,018		98,240,109
Accumulated other comprehensive income		7,509,165		5,688,705
Total stockholders' equity		106,512,184		103,928,815
Total Liabilities and Stockholders' Equity	$	157,958,463	$	153,485,366

Investors Title Company and Subsidiaries
Net Premiums Written By Branch and Agency
For the Three and Twelve Months Ended December 31, 2011 and 2010
(Unaudited)
	Three Months Ended						Twelve Months Ended
	December 31						December 31
	2011		%		2010	%		2011	%		2010	%
Branch	$	4,424,488	24.3	$	4,920,512	25.5	$	16,485,973	20.2	$	17,961,144	29.2
Agency		13,801,643	75.7		14,367,282	74.5		65,043,360	79.8		43,501,297	70.8
Total	$	18,226,131	100.0	$	19,287,794	100.0	$	81,529,333	100.0	$	61,462,441	100.0

CONTACT:
Investors Title Company
Elizabeth B. Lewter, 919-968-2200