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Investors Title Reports Third Quarter Results

October 29, 2004

CHAPEL HILL, N.C.--(BUSINESS WIRE --J. Allen Fine, Chairman of Investors Title Company, (NASDAQ: ITIC) announced that for the quarter ended September 30, 2004, the Company reported net income of $2,927,864, a decrease of 1% compared with the same quarter in 2003. Diluted earnings per share were $1.12 versus $1.13 in the prior year period. Net premiums written decreased 22% to $18,334,559 from $23,469,590 and total revenues decreased 19% to $20,503,324.

For the nine-month period ended September 30, 2004, the Company reported net income of $8,029,863, a decrease of 7% compared with the same nine-month period in 2003. Diluted earnings per share were $3.06 versus $3.30 in the prior year period. Net premiums written decreased 17% to $54,965,967 and total revenues decreased 15% to $60,601,380.

Chairman Fine added, "The decline in premiums written primarily relates to the decrease in mortgage refinance transactions compared with the prior year. This decline was partially offset by a fee increase in our largest market which took effect in the fourth quarter of the preceding year. Sales in our exchange segment continue to grow as activity in Section 1031 tax-free exchanges remains strong driven by ongoing low interest rates. Operating results benefited from higher exchange volume and the increase in title fee income."

Investors Title Company and Subsidiaries
Consolidated Statements of Income
September 30, 2004 and 2003
(Unaudited)

  For The
Three Months Ended
September 30
  For The
Nine Months Ended
September 30
Revenues 2004 2003 2004 2003
Underwriting income: Premiums Written $18,372,069 $23,583,938   $55,166,785 $66,764,869
Less-premiums for reinsurance ceded 37,510 114,348   200,818 304,665
 

 

Net premiums written 18,334,559 23,469,590   54,965,967 66,460,204
         
Investment income- interest and dividends 597,708 666,399   1,963,030 2,020,834
Net realized gain on sales of investments 19,280 1,130   39,667 66,044
Exchange services revenue 931,446 383,094   1,953,644 873,995
Other 620,331 803,026   1,679,072 2,110,248


 

Total 20,503,324 25,323,239   60,601,380 71,531,325
 

 

           
Operating Expenses:          
Commissions to agents 7,372,112 11,029,831   22,283,907 31,885,609
Provision for claims 2,110,152 2,699,432   6,139,555 7,470,163
Salaries, employee benefits and payroll taxes 4,042,857 4,139,980   12,219,022 11,395,979
Office occupancy and operations 1,294,766 1,321,753   3,821,520 3,784,546
Business development 447,159 692,124   1,324,096 1,475,280
Taxes, other than payroll and income 42,823 101,178   341,877 276,460
Premium and retaliatory taxes 357,244 463,437   1,079,639 1,347,542
Professional fees 336,919 324,925   1,144,906 783,064
Other 84,428 87,780   138,995 287,625


 

Total 16,088,460 20,860,440   48,493,517 58,706,268


 

           
Income Before Income Taxes 4,414,864 4,462,799   12,107,863 12,825,057
 

 

           
Provision For Income Taxes 1,487,000 1,499,000   4,078,000 4,165,245
 

 

           
Net Income $ 2,927,864 $ 2,963,799   $ 8,029,863 $ 8,659,812
 

 

           
Basic Earnings Per Common Share $ 1.17 $ 1.18   $ 3.21 $ 3.46
 

 

           
Weighted Average Shares Outstanding - Basic 2,493,786 2,503,405   2,500,654 2,503,650
 

 

           
Diluted Earnings Per Common Share $ 1.12 $ 1.13   $ 3.06 $ 3.30
 

 

           
Weighted Average Shares Outstanding - Diluted 2,608,160 2,629,026   2,621,922 2,621,504


 



Source: Investors Title Company



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