LandAmerica Announces Record Fourth Quarter & Year 2002 Results
February 20, 2003
Plans A Common Stock Repurchase Program
RICHMOND, Va., /PRNewswire-FirstCall/ -- LandAmerica Financial Group, Inc. (NYSE: LFG), a provider of real estate transaction services, announced record earnings for the fourth quarter and year 2002 ended December 31. For the quarter earnings were $66.3 million, or $3.61 per diluted share, compared to $6.4 million, or $.34 per diluted share in the comparable quarter of 2001.
The results for the fourth quarter of 2002, reflecting the new accounting rules in effect for goodwill, included $101,000 of amortization of acquisition-related intangibles, compared to $2.0 million in the fourth quarter of 2001. The fourth quarter of 2002 included after-tax gains from the sale of investments of $880,000, or $.05 per diluted share, while the fourth quarter of 2001 included after-tax gains from the sale of investments of $287,000, or $.02 per diluted share. The fourth quarter of 2002 included an after-tax benefit of $2.6 million, or $.14 per diluted share, from reduction of an exit and termination charge recorded earlier during 2002. The fourth quarter of 2001 included after tax charges of $34 million, or $1.82 per diluted share, resulting primarily from write-downs of the carrying values of developed software and acquisition intangibles.
Operating revenues, excluding investment income, for the fourth quarter of 2002, increased 22.2% to $762.9 million, compared to $624.2 million in the comparable quarter of 2001.
During the fourth quarter of 2002, new open order counts totaled 346,900 or about 13% ahead of the 307,000 new orders opened in the same quarter of 2001.
For the full year 2002, net income was $149.4 million, or $8.04 per diluted share, compared to $60.3 million, or $3.24 per diluted share, for the full year 2001. The full year results for 2002 include after-tax charges of $8.7 million, or $.47 per diluted share, related to exit and termination costs associated with the residential appraisal operations, while the full year results for 2001 included after-tax charges of $34.0 million, or $1.83 per diluted share, related to the previously cited intangibles and exit and termination charges. The results for the full year 2002, reflecting the new accounting rules in effect for goodwill, included $425,000 of amortization of acquisition-related intangibles, compared to $9.3 million for the full year 2001. The full year 2002 included after-tax gains from the sale of investments of $855,000, or $.05 per diluted share, compared to after-tax gains from the sale of investments of $137,000, or $.01 per diluted share, for the full year 2001.
Additionally, the company announced today that its Board of Directors has approved a program to purchase over the next twelve months up to 1.25 million shares, or approximately 7%, of its outstanding common stock. The company has allocated $40 million to this program. Purchases of stock will be accomplished primarily on the open market, with the timing of such transactions subject to market conditions and SEC regulations. The company anticipates funding for this program to come from available corporate funds, an existing credit facility and future excess cash flow. The program would be in addition to the open market purchases presently made in connection with LandAmerica's employee benefit plans.
Commenting on the company's performance, chairman and chief executive officer Charles H. Foster, Jr. noted, "This has been a tremendous year for the real estate transaction services industry and for LandAmerica. Our operating revenue of over $2.5 billion and net income of almost $150 million for the year set all-time records. We also generated record cash flow from operations of $228 million for the year. Mortgage rates have remained near record lows and our open order counts so far in 2003 have remained strong, which speaks well to our prospects for the first half of 2003.
"While we have remained vigilant about our cost structure, we continue to pursue growth. We recently announced investments to significantly increase our presence in the Salt Lake City market and three weeks ago announced an acquisition that greatly enhances our presence in the very important New York City commercial market."
Commenting on the share repurchase program, Mr. Foster noted, "Over the past four years, we have reduced our total shares outstanding through share repurchases. This new program allows us to continue our balanced approach to driving shareholder value through a combination of growth, dividends and share repurchases."
Source: LandAmerica Financial Group, Inc.