EXHIBIT 99.1
Investors Title Company Announces Second Quarter 2008 Results
CHAPEL HILL, N.C., Aug. 7, 2008 (PRIME NEWSWIRE) -- J. Allen Fine, Chairman of Investors Title Company (Nasdaq:ITIC), announced that for the second quarter ended June 30, 2008, the Company reported a net loss of $273,934 compared with net income of $1,154,149 for the same three-month period in 2007. Net loss per diluted share equaled $0.11 compared with net income per diluted share of $0.46 in the same period last year. Net premiums written decreased 2.7% to $18,127,982, investment income decreased 12.5% to $1,112,681 and revenues decreased 7.9% to $20,352,800 compared with the prior year period.
For the six-month period ended June 30, 2008, the Company reported net income of $1,850,446, a decrease of 46.8%, compared with $3,476,363 for the same six-month period in 2007. Diluted earnings per share were $0.76, a decrease of 44.9% compared with $1.38 for the same six-month ended period in 2007. Net premiums written increased 1.5% to $35,941,342, investment income decreased 3.6% to $2,392,040 and revenues decreased 2.9% to $41,213,719 compared with the prior year period.
Net operating results for the quarters ended June 30, 2008 and 2007 were primarily impacted by an increase in the provision for claims of $2.4 million and $2.3 million, respectively, due to the occurrence of large fraud related claims. The claim during the current quarter resulted from the theft of settlement funds from an attorney's trust account intended to satisfy prior deeds of trusts. For the quarter ended June 30, 2008, the exchange services segment experienced a significant decline in revenue related to a decrease in demand and interest income earned on exchange funds compared with the prior year period. In addition, there was a decrease in realized gains on investments along with a decline in investment income due to a lower level of interest income earned on short-term funds.
Chairman Fine added, "Although we have made progress in building our agency business this year, the ongoing decline in real estate activity and the persistence of instances of fraud have combined to make a very challenging operating environment. We continue to direct our efforts towards increasing both our direct and agency business, enhancing our efficiency and improving management of fraud and other related risks that tend to surface in real estate downturns."
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, 2007, as filed with the Securities and Exchange Commission.
Investors Title Company and Subsidiaries Consolidated Statements of Income June 30, 2008 and 2007 (Unaudited) For The Three For The Six Months Ended Months Ended June 30 June 30 ------------------------ ------------------------ 2008 2007 2008 2007 ---- ---- ---- ---- Revenues: Underwriting income: Premiums Written $18,178,892 $18,715,760 $36,082,654 $35,590,737 Less-premiums for reinsurance ceded 50,910 89,581 141,312 172,016 ----------- ----------- ----------- ----------- Net premiums written 18,127,982 18,626,179 35,941,342 35,418,721 Investment income- interest and dividends 1,112,681 1,271,755 2,392,040 2,481,362 Net realized gain (loss) on investments (242,272) 200,023 (123,703) 366,203 Exchange services revenue 66,714 870,083 471,412 2,115,562 Other 1,287,695 1,139,493 2,532,628 2,059,454 ----------- ----------- ----------- ----------- Total Revenues 20,352,800 22,107,533 41,213,719 42,441,302 ----------- ----------- ----------- ----------- Operating Expenses: Commissions to agents 7,949,938 7,733,004 15,269,208 14,578,292 Provision for claims 4,298,414 4,352,005 6,347,010 6,161,438 Salaries, employee benefits and payroll taxes 5,311,626 5,091,139 10,809,562 10,365,514 Office occupancy and operations 1,328,083 1,452,901 2,692,335 2,889,024 Business development 567,881 556,734 1,053,332 1,079,916 Filing fees and taxes, other than payroll and income 138,875 126,455 331,504 291,668 Premium and retaliatory taxes 451,728 395,262 819,065 837,182 Professional and contract labor fees 502,531 826,140 1,023,940 1,471,150 Other 304,658 278,744 543,317 500,755 ----------- ----------- ----------- ----------- Total Operating Expenses 20,853,734 20,812,384 38,889,273 38,174,939 ----------- ----------- ----------- ----------- Income (Loss) Before Income Taxes (500,934) 1,295,149 2,324,446 4,266,363 ----------- ----------- ----------- ----------- Provision (Benefit) For Income Taxes (227,000) 141,000 474,000 790,000 ----------- ----------- ----------- ----------- Net Income (Loss) $ (273,934) $ 1,154,149 $ 1,850,446 $ 3,476,363 =========== =========== =========== =========== Basic Earnings (Loss) Per Common Share $ (0.11) $ 0.46 $ 0.77 $ 1.40 =========== =========== =========== =========== Weighted Average Shares Outstanding - Basic 2,409,206 2,484,874 2,410,852 2,491,955 =========== =========== =========== =========== Diluted Earnings (Loss) Per Common Share $ (0.11) $ 0.46 $ 0.76 $ 1.38 =========== =========== =========== =========== Weighted Average Shares Outstanding - Diluted 2,409,206 2,518,206 2,434,204 2,526,844 =========== =========== =========== =========== Investors Title Company and Subsidiaries Consolidated Balance Sheets As of June 30, 2008 and December 31, 2007 (Unaudited) June 30, December 31, 2008 2007 ------------ ------------ Assets Investments in securities: Fixed maturities: Held-to-maturity, at amortized cost $ 556,648 $ 1,052,535 Available-for-sale, at fair value 78,226,868 90,530,946 Equity securities, available-for-sale, at fair value 13,769,982 14,586,066 Short-term investments 29,967,654 21,222,533 Other investments 2,398,819 1,634,301 ------------ ------------ Total investments 124,919,971 129,026,381 Cash and cash equivalents 3,136,693 3,000,762 Premiums and fees receivable, net 7,084,652 6,900,968 Accrued interest and dividends 1,123,266 1,254,641 Prepaid expenses and other assets 2,071,246 1,276,806 Property acquired in settlement of claims 392,609 278,476 Property, net 4,808,139 5,278,891 Deferred income taxes, net 2,706,061 2,625,495 ------------ ------------ Total Assets $146,242,637 $149,642,420 ============ ============ Liabilities and Stockholders' Equity Liabilities: Reserves for claims $ 37,236,000 $ 36,975,000 Accounts payable and accrued liabilities 10,023,544 11,236,781 Commissions and reinsurance payable 227,313 406,922 Current income taxes payable -- 1,747,877 ------------ ------------ Total liabilities 47,486,857 50,366,580 ------------ ------------ Stockholders' Equity: Common stock - no par value (shares authorized 10,000,000; 2,400,482 and 2,411,318 shares issued and outstanding 2008 and 2007, respectively, excluding 291,676 shares for 2008 and 2007 of common stock held by the Company's subsidiary) 1 1 Retained earnings 96,502,927 95,739,827 Accumulated other comprehensive income 2,252,852 3,536,012 ------------ ------------ Total stockholders' equity 98,755,780 99,275,840 ------------ ------------ Total Liabilities and Stockholders' Equity $146,242,637 $149,642,420 ============ ============ Investors Title Company and Subsidiaries Net Premiums Written By State June 30, 2008 and 2007 (Unaudited) For the Three Months For the Six Months Ended Ended June 30 June 30 State 2008 2007 2008 2007 --------------------------------------------------------------------- Illinois $ 564,584 $ 460,531 $ 1,154,553 $ 849,488 Kentucky 815,131 675,454 1,631,941 1,225,144 Maryland 105,285 310,321 373,109 597,192 Michigan 904,735 798,861 1,950,562 1,578,186 New York 685,689 658,675 1,197,887 1,165,434 North Carolina 8,767,479 9,218,284 17,716,146 17,131,757 Pennsylvania 522,147 406,236 965,276 732,890 South Carolina 2,012,755 1,857,204 3,916,135 3,573,604 Tennessee 614,000 732,461 1,155,674 1,381,851 Virginia 1,686,833 1,572,652 3,208,627 3,133,156 West Virginia 641,537 545,827 1,112,435 1,013,752 Other 858,517 1,474,517 1,603,765 3,196,616 ----------- ----------- ----------- ----------- Direct Premiums $18,178,692 $18,711,023 $35,986,110 $35,579,070 Reinsurance Assumed 200 4,737 96,544 11,667 Reinsurance Ceded (50,910) (89,581) (141,312) (172,016) ----------- ----------- ----------- ----------- Net Premiums Written $18,127,982 $18,626,179 $35,941,342 $35,418,721 =========== =========== =========== =========== Investors Title Company and Subsidiaries Net Premiums Written By Branch and Agency June 30, 2008 and 2007 (Unaudited) For The Three Months Ended June 30 ----------------------------------------------------- 2008 % 2007 % ----------------------------------------------------- Branch $ 6,888,518 38 $ 7,907,600 42 Agency 11,239,464 62 10,718,579 58 ----------------------------------------------------- Total $ 18,127,982 100 $ 18,626,179 100 ===================================================== For The Six Months Ended June 30 ----------------------------------------------------- 2008 % 2007 % ----------------------------------------------------- Branch $ 14,239,813 40 $ 15,040,911 42 Agency 21,701,529 60 20,377,810 58 ----------------------------------------------------- Total $ 35,941,342 100 $ 35,418,721 100 =====================================================
CONTACT: Investors Title Company Elizabeth B. Lewter (919) 968-2200