Investors Title Company today announced its results for the quarter ended March 31, 2010. The Company reported net income of $17,415, or $0.01 per diluted share, compared with $1,434,963, or $0.62 per diluted share, for the prior year period.
Total revenues decreased 26.7% to $13,697,411 versus the prior year period, primarily due to a 28.2% decrease in net premiums written. Although premiums resulting from purchase transactions increased versus the prior year period, a sharp decline in refinance premiums resulted in an overall unfavorable comparison. Investment income decreased 8.4% to $906,622 due to an overall unfavorable interest rate environment.
Operating expenses decreased 19.1% to $13,681,996 versus the prior year period, primarily due to a 25.7% decrease in commissions to agents commensurate with lower premium volume, and a 35.9% decrease in provision for claims resulting from both lower premium volumes and a slight improvement in the Company’s claims experience loss rate. In addition, salaries and related expenses were 12.7% lower compared with the prior year period as a result of a continued emphasis on expense management.
Chairman J. Allen Fine added, “The declining volume of mortgage refinancing activity was the primary influence on operating results in the quarter. After declining in late 2008, mortgage rates have remained in a relatively narrow range and we believe much of the anticipated refinancing has taken place. On a positive note we were pleased to see a modest reduction in our claims experience loss rate which resulted primarily from a reduction in mechanic liens from the prior year period.The current operating environment remains challenging as overall mortgage origination continues to decline. We continue to monitor the market and search for opportunities to improve efficiency and expand our presence.” 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.