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Investors Title Company (NASDAQ: ITIC), announced its results for the second quarter ended June 30, 2012. Net income increased 110.0% to $3,349,488, or $1.57 per diluted share, compared with $1,594,805, or $0.74 per diluted share, for the prior year quarter.
Revenues increased 10.0% to $26,080,325 versus the prior year quarter, primarily due to an 8.3% increase in net premiums written. The premium growth reflects widespread volume increases across multiple markets, as overall mortgage activity increased substantially. New industry-wide premium charges for North Carolina that went into effect earlier this year also contributed to the increase in premiums. Premiums in the second quarter related to refinancing transactions declined slightly compared with the first quarter, but were up compared with the prior year quarter.
Operating expenses decreased 1.0% to $21,460,624 versus the prior year quarter, primarily due to decreases in the provision for claims and commissions to agents. The claims provision rate was lower compared with the prior year due to an adjustment for favorable loss development in prior policy years. Commissions to agents decreased 4.8%, as agency premiums declined and the business mix shifted to states with lower average commission rates. These favorable trends helped to offset increased spending on technology and system development.
For the six months ended June 30, 2012, net income increased 82.9% to $4,781,627, or $2.24 per diluted share, compared with $2,614,012, or $1.19 per diluted share, for the prior year period. Revenues increased 10.9% to $48,494,599 as a result of factors noted above, while operating expenses increased 3.9% versus the prior year period.
Chairman J. Allen Fine added, “We are pleased to report a strong quarter, as we benefitted from continued strength in refinance activity, further expansion of our agent base, and favorable claims experience. Our focus remains on enhancing our competitive strengths and capitalizing on opportunities to profitably expand our market presence.”