Investors Title Company Announces Record Third Quarter 2016 Financial Results

Investors Title Company today announced its results for the third quarter ended September 30, 2016. Net income attributable to the Company increased 81.0% to an all-time record high of $8.1 million, or $4.29 per diluted share, versus $4.5 million, or $2.28 per diluted share, for the prior year period.

Revenues increased 18.7% versus the prior year quarter to an all-time record high of $41.0 million, mainly due to an 18.0% increase in net premiums written. The increase in premiums is due to higher aggregate coverage insured resulting from increased transaction volume and real estate values, as well as higher average premium rates.

Operating expenses increased 5.4% versus the prior year quarter to $29.6 million, primarily due to increases in commissions and payroll expenses, partially offset by a benefit for claims. Commissions increased commensurate with the increase in agency premium volume. Payroll expenses increased 19.3% to $8.3 million, mainly due to an increase in the accrual for incentive compensation and fluctuations in the level of capitalized salaries related to software development. There was a benefit for claims during the current quarter, stemming from favorable loss development in recent policy years. Claim experience in recent years has improved in part due to a decrease in the level of foreclosure activity. All other categories of operating expenses, in total, were up 3.0% versus the prior year period.

For the nine months ended September 30, 2016, net income attributable to the Company increased 40.0% to $14.5 million, or $7.53 per diluted share, versus $10.3 million, or $5.17 per diluted share, for the prior year period. Revenues increased 1.4% to $99.7 million versus the prior year period, while operating expenses decreased 5.4% to $79.2 million. Commissions decreased 5.1%, mainly due to a decline in agency premiums and concentration of business in markets with lower average commission rates. Variances in claims, payroll, and other categories of expenses were shaped predominantly by the same factors that affected the third quarter.

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