Capital Title Group Reports Strong Third Quarter Results
|October 22, 2002|
Revenue Increased 89.4% Along With Improved Pre-Tax Profits
PHOENIX, /PRNewswire-FirstCall/ -- Capital Title Group, Inc. (Nasdaq: CTGI - News) -- a leading regional provider of title insurance and real estate-related services, today reported its revenues and results for the third quarter and nine months ended September 30, 2002.
Revenues for the three month period ended September 30, 2002, increased 89.4% to $31,442,404 and includes one month of revenue attributable to the merger with Nations Holding Group (Nations) effective on September 1, 2002, compared to revenues for the same period in 2001 of $16,599,983.
Pre-tax income for the quarter was $2,386,333 compared to $1,803,280 in the corresponding period in the prior year. Net income available for common stock in the quarter was $1,360,050 or $0.08 per diluted share compared to $1,452,280 or $0.08 per diluted share.
Net income for the third quarter 2002 includes income tax expense at statutory rates while income tax expense in the prior year was much lower due to the availability of tax loss carryforwards. If tax loss carryforwards would not have been available in the 2001 period, net income would have been $1,082,000 or $0.06 per diluted share.
Revenues for the nine month period rose to $71,515,844, a 53.8% increase compared with $46,491,269 for the nine months ended September 30, 2001. Pre-tax income for the nine months ended September 30, 2002, was $5,451,673 compared to $4,405,787 in the corresponding period in the prior year. Net income available to common stock for the nine months was $3,125,353 or $0.17 per diluted share compared to net income for the comparable nine month period in 2001 of $4,054,787 or $0.23 per diluted share. If income tax were applied to the 2001 period at statutory rates, net income would have been $2,643,000 or $0.15 per diluted share.
"The company reached its' target goals for the third quarter from an operational perspective," stated Donald R. Head, chairman, president and chief executive officer of Capital Title Group. "Income tax expense and amortization expense related to the closing of our merger with Nations had a direct affect on our net income when compared to the prior year. For our nine months ended September 30, we carried the full burden of income tax expense totaling $2.3 million unlike the prior year when our income tax expense for the comparable period was offset by utilizing loss carryforwards that reduced our tax expense to $351,000.
"In the quarter we also incurred $345,000 in amortization expense as required by recent accounting guidance set forth by the Financial Accounting Standards Board (FASB) in the closing of our Nations transaction. This charge relates to the value assigned to Nations' order backlog. Operationally, the start of our integration of Nations into our family of companies has been exceptional," Head continued.
"We expect to put forth guidance for our fourth quarter and year 2003 in early November. We have seen our open order count set new records in recent months. We expect the real estate industry will be strong for the balance of the year and continue to be favorable into early 2003. New home building and residential resale transactions continue to be very strong in our market areas," Head concluded.
Source: Capital Title Group, Inc.