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Capital Title Group Reports Record Revenue of $250.2 Million for Full Year 2003

February 17, 2004

PHOENIX, /PRNewswire-FirstCall/ -- Capital Title Group, Inc. (Nasdaq: CTGI ) -- a regional title agency, title insurance underwriter and provider of real estate-related services, announced that results for 2003 reflect the impact of the company's growth through acquisitions and the expansion of existing operations. Record revenue levels were aided by a strong housing market coupled with a high level of refinance transactions as a result of low mortgage interest rates available throughout the year. In addition, revenue was elevated by the company's title agencies issuing title insurance policies through a wholly owned underwriting subsidiary acquired in 2002.

For the full-year 2003, the company reported record revenue of $250.2 million compared to revenue of $127.7 million for the year 2002. Earnings attributable to common stock for 2003 was $15.2 million or $0.77 per diluted share compared to earnings for the year 2002 of $6.9 million or $0.38 per diluted share.

With the anticipated decline in refinance transactions in the 2003 fourth quarter, the company reported revenue of $51.9 million as compared to revenue of $56.2 million in the record breaking refinance market for the 2002 fourth quarter. Earnings attributable to common stock for the 2003 three month period was $1.2 million or $0.06 per diluted share compared to $3.8 million or $0.21 per diluted share in the comparable 2002 three month period.

"The company set record levels for revenues and earnings per share in year 2003 irrespective of the decline in refinance transactions and related staff adjustments impacting our fourth quarter over quarter results. Our record year was the result of a focus that centered on the integration of our acquisitions and increasing the utilization of our title insurance underwriting capabilities," stated Donald R. Head, chairman of the board, president and chief executive officer. "Increase in our market share in existing locations partially offset the revenue decline in the fourth quarter as demand for refinancing softened to pre-2002 historical levels.

"A part of our 2004 business strategy began last year with our vision to diversify and grow our revenues through a bundling of settlement services. We recently announced the signing of an agreement to acquire Nationwide Appraisal Services Corporation, which we anticipate will provide the initial foundation for our bundled services program. We recently formed CTG Real Estate Information Services, and have selected Richard A. Alexander to serve as its President and Chief Executive Officer. Rich has significant lending and real estate industry experience combined with leadership ability to direct the launch of our plans for diversification through the concept of bundled services," Head continued. "We all welcome Rich to the Capital Title family of companies."

Mr. Alexander was most recently Director of Business Development for CBC Companies where he assisted in the acquisition of nine companies of which five were real estate related and helped create a full bundle of services. Previously he was President of GE Capital Residential Capital Connections. Prior to that time he co-founded and served as the President of United General Information Services, LLC, a national provider of bundled real estate settlement services, until it was acquired by GE Capital.

Capital Title Group, Inc. And Subsidiaries Consolidated Summary Of Operations
Financial Highlights

THREE MONTHS ENDED
DECEMBER 31,

TWELVE MONTHS ENDED
DECEMBER 31,


(in thousands, except per share data)

2003 2002 2003 2002

Revenue $51,970 $56,195 $250,245 $127,711



Expenses 49,340 49,364 222,792 115,428



Income before income taxes 2,630 6,831 27,453 12,283



Income tax expense 1,076 2,724 10,893 5,001



Net income 1,554 4,107 16,560 7,282



Dividends on preferred stock 353 353 1,401 403



Earnings attributable to common stocks $1,201 $3,754 $15,159 $6,879



 

Net Income per common share:





Basic $0.07 $0.21 $0.84 $0.39



Diluted $0.06 $0.21 $0.77 $0.38



 

Weighted average number of common shares outstanding





Basic 18,305,737 17,609,927 18,142,279 17,417,061



Diluted 20,161,964 18,211,971 19,755,108 18,121,419

Source: Capital Title Group, Inc.



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