Core Insights - Investors Title Company (ITIC) shares increased by 4.5% following the earnings report for Q3 2025, outperforming the S&P 500 index, which declined by 0.6% during the same period [1] - The company reported earnings per share of $6.45, up from $4.92 a year ago, indicating strong year-over-year growth [1] Revenue and Income - Total revenues rose by 6.1% to $73 million compared to $68.8 million in the prior-year quarter, driven by a $2 million increase in non-title services and a $1.8 million gain in net premiums written and escrow and title-related fees [2] - Net income reached $12.2 million, reflecting a 31.1% increase from $9.3 million in the same period last year [2] Business Metrics - Non-title services revenues surged by 45.4% to $6.3 million, attributed to higher revenues from like-kind exchanges and management services [3] - Net premiums written increased by 2.8% to $56.4 million, with direct premiums and agency premiums contributing 29% and 71% respectively [3] - Escrow and title-related fees grew by 5.2% to $4.8 million [3] Investment Gains and Expenses - Net investment gains nearly doubled to $2.1 million from $1 million, driven by realized gains on securities and favorable changes in equity investment valuations [4] - Total operating expenses increased by only 1.2% to $57.9 million, aided by effective expense management [4] Management Commentary - Chairman J. Allen Fine expressed confidence in the company's momentum, noting the third quarter marked the best-performing consecutive three-quarter period since 2021 [5] - The robust performance was attributed to growing title insurance revenues and a strong like-kind exchange business, alongside favorable market conditions such as declining mortgage rates [5] Performance Drivers - Improved earnings were primarily driven by higher real estate transaction volume and increased demand for title insurance and tax-deferred exchange services [6] - Operating leverage was significant, with revenue growth outpacing expense increases, while personnel expenses saw a slight decrease [6] Investment Perspective - Gains in the equity securities portfolio contributed positively, adding nearly $1.1 million to bottom-line earnings, with non-GAAP income before income taxes rising 22.8% year over year [7] Other Developments - A $3.2 million increase in "other revenue" for the nine-month period was linked to a gain recognized on assets contributed to a joint venture, indicating potential strategic investment opportunities [8]

Revenue and Income - Total revenues for the title insurance segment accounted for 90.1% of the Company's revenues for the nine-month period ended September 30, 2025[90]. - Total revenues for the three-month period ended September 30, 2025, were $73.0 million, an increase from $68.8 million in the same period of 2024[112]. - Net income for the nine-month period ended September 30, 2025, was $27.7 million, compared to $22.7 million for the same period in 2024, reflecting a growth of 22.0%[112]. - Total net premiums written were $56.40 million for the three months and $157.24 million for the nine months ended September 30, 2025, compared to $54.86 million and $146.45 million for the same prior year periods[119]. Premiums and Claims - Net premiums written increased by 2.8% to $56.4 million for the three-month period and by 7.4% to $157.2 million for the nine-month period ended September 30, 2025, compared to the same prior year periods[114]. - Direct net premiums written increased by 0.4% to $16.33 million for the three months ended September 30, 2025, and by 1.3% to $45.69 million for the nine months ended September 30, 2025, compared to the same prior year periods[116]. - Agency net premiums written increased by 3.8% to $40.07 million for the three months ended September 30, 2025, and by 10.1% to $111.56 million for the nine months ended September 30, 2025, compared to the same prior year periods[117]. - The provision for claims decreased to $1.2 million for the three-month period ended September 30, 2025, from $1.7 million in the same period of 2024[112]. - The provision for claims decreased by 27.5% for the three-month period but increased by 3.7% for the nine-month period ended September 30, 2025, with the provision as a percentage of net premiums written at 2.1% and 2.3%, respectively[144]. - Actual payments of claims, net of recoveries, were $2.5 million for the nine-month period ended September 30, 2025, compared to $3.6 million in the prior year[145]. - As of September 30, 2025, the total reserve for claims was $38.2 million, with approximately $3.3 million reserved for specific claims[146]. Operating Expenses - The Company's operating expenses for the nine-month period ended September 30, 2025, totaled $168.3 million, up from $159.0 million in the same period of 2024[112]. - Operating expenses increased by 1.2% to $57.93 million for the three months and by 5.8% to $168.30 million for the nine months ended September 30, 2025, compared to the same prior year periods[137]. - Personnel expenses decreased to $17.4 million for the three months and $53.2 million for the nine months ended September 30, 2025, compared to $18.1 million and $54.8 million for the same prior year periods[140]. - Other expenses increased to $4.9 million and $14.3 million for the three- and nine-month periods ended September 30, 2025, compared to $4.0 million and $12.1 million in the same prior year periods, primarily due to higher professional services and miscellaneous expenditures[142]. Cash Flow and Investments - Net cash flows provided by operating activities were $25.9 million for the nine-month period ended September 30, 2025, compared to $17.7 million in the prior year[154]. - As of September 30, 2025, the Company held cash and cash equivalents of $22.8 million and short-term investments of $88.1 million[156]. - Capital expenditures were approximately $4.2 million for the nine-month period ended September 30, 2025, with plans for technology and system development initiatives[164]. - The company held approximately $427.1 million in like-kind exchange deposits and $323.5 million in reverse exchange property as of December 31, 2024[170]. - The company does not consider external assets under management as part of its assets, excluding them from the unaudited Consolidated Balance Sheets[171]. Regulatory and Market Conditions - The North Carolina Department of Insurance approved a 9.4% rate increase effective October 1, 2025, and the Ohio Department of Insurance approved a 9.0% rate increase effective January 1, 2026, which are expected to positively impact future premium revenues[119]. - The Mortgage Bankers Association projects a 20.5% net increase in total mortgage originations to $2,031 billion in 2025 from 2024 levels[108]. - The company’s forward-looking statements reflect management's outlook and are subject to various risks, including changes in interest rates and economic conditions[174]. - The company actively monitors market risks related to fluctuations in interest rates and equity market values, without utilizing derivative financial instruments for hedging[176]. Profitability Metrics - After-tax profit margins improved to 16.7% for the three months and 13.6% for the nine months ended September 30, 2025, compared to 13.5% and 12.1% for the same prior year periods[139]. - The provision for income taxes was $2.9 million and $7.3 million for the three- and nine-month periods ended September 30, 2025, with effective tax rates of 19.1% and 20.8%, respectively[148]. Investment Gains - The Company recorded net realized investment gains of $856 thousand for the three months and $4.0 million for the nine months ended September 30, 2025, compared to $235 thousand and $4.7 million for the same prior year periods[131]. Accounting and Financial Practices - The company does not engage in off-balance sheet arrangements or issue guarantees to third parties, limiting such arrangements to future payments under agreements with service providers[172]. - No recent accounting pronouncements are expected to materially impact the company's financial position or results of operations[173].

Revenues increased 6.1% to $73.0 million, up from $68.8 million in the prior year period. Non-title services revenue increased $2.0 million, largely attributable to increases in revenue from like-kind exchanges and management services. Net premiums written and escrow and title-related fees grew by $1.8 million, primarily driven by higher real estate activity levels. Net investment gains increased by $1.1 million, driven by higher realized gains from the sale of investment securities and favorable changes in ...

Core Viewpoint - Investors Title Company (NASDAQ: ITIC) is recommended as a "Buy" due to its consistent ability to outperform the market through strong dividend performance [1] Company Analysis - The company demonstrates elements that support continued success in the market, particularly through its dividend strategy [1]

Company Overview - Investors Title Company (NASDAQ: ITIC) is one of the largest title insurance companies in the United States, generating net premiums written of $204 million in FY 2024 and almost $101 million in the first half of the fiscal year [1] Investment Focus - The investment group European Small Cap Ideas focuses on high-quality investment opportunities in the small-cap space, emphasizing capital gains and dividend income for continuous cash flow [1] Portfolio Features - The group offers two model portfolios: the European Small Cap Ideas portfolio and the European REIT Portfolio, along with weekly updates and educational content on European investing opportunities [1]

Core Insights - Investors Title Company (ITIC) shares have increased by 5.4% since the earnings report for the quarter ended June 30, 2025, outperforming the S&P 500 index, which rose by 1.3% during the same period [1] - The stock has shown a 12.2% gain over the past month, compared to a 2% growth in the S&P 500, indicating strong momentum [1] Financial Performance - For Q2 2025, net income was reported at $6.48 per share, a 38% increase from $4.70 per share a year earlier [2] - Revenues increased by 12.6% to $73.6 million from $65.4 million in the prior-year quarter, driven by higher real estate activity and gains from asset transfers [2] - Operating expenses rose by 6.9% to $57.9 million, attributed to higher agent commissions and increased provisions for claims [2] Key Business Metrics - Net premiums written rose to $54.5 million from $51.4 million, with contributions from both direct and agency channels [4] - Escrow and other title-related fees increased to $5.7 million from $4.8 million, while non-title services revenue climbed to $5.5 million from $4.3 million [4] - Net investment gains were recorded at $2.1 million, up from $1.2 million in the previous year, due to favorable changes in the estimated fair value of equity securities [4] Management Commentary - Chairman J. Allen Fine stated that this was the company's strongest quarterly performance in over three years, attributing it to solid execution and broad-based revenue growth [5] - He highlighted growth in title insurance revenues and contributions from non-title business segments, particularly the like-kind exchange subsidiary [5] - Incoming order volumes surpassed those of the prior year, indicating a stronger pipeline for the third quarter [5] Influencing Factors - Top-line growth was fueled by increased real estate market activity, higher non-title services revenues, and a gain from asset transfers to a joint venture [6] - Higher commissions to agents aligned with the growth in agent-originated business, while claims costs rose due to larger reserves on reported claims [6] - Net investment gains contributed to year-over-year income growth [6] Other Developments - The quarter included a notable $2.7 million gain from assets transferred to a joint venture, boosting "Other" revenues [7]

[FORM 10-Q](index=1&type=section&id=FORM%2010-Q) [PART I. FINANCIAL INFORMATION](index=2&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited consolidated financial statements of Investors Title Company and its subsidiaries for the periods ended June 30, 2025, and December 31, 2024 (for balance sheets) or June 30, 2025 and 2024 (for income and cash flow statements), along with detailed notes explaining accounting policies, claims reserves, earnings per share, segment performance, investments, and other financial disclosures [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) The Consolidated Balance Sheets show the company's financial position as of June 30, 2025, compared to December 31, 2024, indicating an increase in total assets and stockholders' equity, while total liabilities slightly decreased | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | % Change | | :-------------------------- | :----------------------------- | :------------------------------- | :-------------------- | :------- | | Total Assets | $345,824 | $333,571 | $12,253 | 3.67% | | Total Liabilities | $79,647 | $81,798 | $(2,151) | -2.63% | | Total Stockholders' Equity | $266,177 | $251,773 | $14,404 | 5.72% | [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) The Consolidated Statements of Operations reflect a significant increase in net income and basic earnings per common share for both the three and six months ended June 30, 2025, compared to the prior year periods, driven by higher total revenues and managed operating expenses | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | YoY Change (3M) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | YoY Change (6M) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | | Total Revenues | $73,649 | $65,382 | 12.65% | $130,214 | $118,841 | 9.57% | | Net Income | $12,278 | $8,871 | 38.41% | $15,449 | $13,396 | 15.32% | | Basic Earnings per Common Share | $6.51 | $4.71 | 38.22% | $8.19 | $7.10 | 15.35% | [Consolidated Statements of Comprehensive Income](index=5&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) The Consolidated Statements of Comprehensive Income show an increase in comprehensive income for both the three and six months ended June 30, 2025, primarily due to net income and positive other comprehensive income from unrealized gains on investments, contrasting with losses in the prior year | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | YoY Change (3M) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | YoY Change (6M) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | | Net income | $12,278 | $8,871 | 38.41% | $15,449 | $13,396 | 15.32% | | Other comprehensive income (loss) | $237 | $(178) | 233.15% | $467 | $(470) | 199.36% | | Comprehensive Income | $12,515 | $8,693 | 43.97% | $15,916 | $12,926 | 23.13% | [Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Equity) The Consolidated Statements of Stockholders' Equity illustrate the changes in equity for the three and six months ended June 30, 2025 and 2024, reflecting increases in retained earnings and accumulated other comprehensive income, alongside dividend payments and share-based compensation | Metric | June 30, 2025 (in thousands) | June 30, 2024 (in thousands) | Change (in thousands) | | :-------------------------- | :----------------------------- | :----------------------------- | :-------------------- | | Retained earnings | $265,355 | $261,648 | $3,707 | | Accumulated other comprehensive income | $822 | $168 | $654 | | Total Stockholders' Equity | $266,177 | $261,816 | $4,361 | [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) The Consolidated Statements of Cash Flows show a net increase in cash and cash equivalents for the six months ended June 30, 2025, primarily driven by operating activities, despite net cash used in investing and financing activities | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | YoY Change (in thousands) | | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | :------------------------ | | Net cash provided by operating activities | $8,785 | $9,870 | $(1,085) | | Net cash used in investing activities | $(2,020) | $(4,384) | $2,364 | | Net cash used in financing activities | $(1,736) | $(2,831) | $1,095 | | Net Increase in Cash and Cash Equivalents | $5,029 | $2,655 | $2,374 | | Cash and Cash Equivalents, End of Period | $29,683 | $26,686 | $2,997 | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) These notes provide essential details and explanations supporting the consolidated financial statements, covering the basis of presentation, significant accounting policies, specific financial accounts like claims reserves and investments, segment performance, and other commitments and contingencies [Note 1 – Basis of Presentation and Significant Accounting Policies](index=10&type=section&id=Note%201%20%E2%80%93%20Basis%20of%20Presentation%20and%20Significant%20Accounting%20Policies) - The unaudited Consolidated Financial Statements are prepared in accordance with GAAP for interim financial information, with all intercompany balances and transactions eliminated[23](index=23&type=chunk) - Management's estimates and assumptions are used in preparing the financial statements, and actual results may differ[25](index=25&type=chunk) - The One Big Beautiful Bill Act (OBBBA) was enacted on July 4, 2025, with provisions effective from 2025 through 2027, and the company is currently assessing its impact on consolidated financial statements[26](index=26&type=chunk) [Note 2 – Reserve for Claims](index=10&type=section&id=Note%202%20%E2%80%93%20Reserve%20for%20Claims) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :------------------------------- | | Balance, beginning of period | $37,060 | $37,147 | | Provision charged to operations | $2,403 | $4,530 | | Payments of claims, net of recoveries | $(1,412) | $(4,617) | | Balance, end of period | $38,051 | $37,060 | | Component | June 30, 2025 (in thousands) | % of Total | December 31, 2024 (in thousands) | % of Total | | :-------------------------- | :----------------------------- | :--------- | :------------------------------- | :--------- | | Known title claims | $3,205 | 8.4% | $2,650 | 7.2% | | IBNR | $34,846 | 91.6% | $34,410 | 92.8% | | Total reserve for claims | $38,051 | 100.0% | $37,060 | 100.0% | - Management believes the total reserve for claims is adequate, but estimates are subject to variability and continuous review[27](index=27&type=chunk) [Note 3 – Earnings Per Common Share and Share Awards](index=11&type=section&id=Note%203%20%E2%80%93%20Earnings%20Per%20Common%20Share%20and%20Share%20Awards) | Metric | 3 Months Ended June 30, 2025 | 3 Months Ended June 30, 2024 | 6 Months Ended June 30, 2025 | 6 Months Ended June 30, 2024 | | :---------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net income (in thousands) | $12,278 | $8,871 | $15,449 | $13,396 | | Weighted average common shares outstanding – Basic (in thousands) | 1,887 | 1,884 | 1,886 | 1,886 | | Basic earnings per common share | $6.51 | $4.71 | $8.19 | $7.10 | | Diluted earnings per common share | $6.48 | $4.70 | $8.16 | $7.10 | - The company has an active share-based compensation plan limited to SARs, with **250 thousand shares available for grant**[31](index=31&type=chunk) - All outstanding SARs are share-settled and vest within five years or less[32](index=32&type=chunk) SARs Activity | SARs Activity | Outstanding as of Jan 1, 2024 (in thousands) | SARs granted (2024) (in thousands) | SARs exercised (2024) (in thousands) | Outstanding as of Dec 31, 2024 (in thousands) | SARs granted (2025) (in thousands) | SARs exercised (2025) (in thousands) | Outstanding as of Jun 30, 2025 (in thousands) | | :---------------------------------------- | :---------------------------- | :------------------ | :-------------------- | :----------------------------- | :------------------ | :-------------------- | :----------------------------- | | Number Of Shares | 42 | 5 | (19) | 28 | 5 | (7) | 26 | | Weighted Average Exercise Price | $160.83 | $160.94 | $170.21 | $154.71 | $246.75 | $160.62 | $169.23 | [Note 4 – Segment Information](index=13&type=section&id=Note%204%20%E2%80%93%20Segment%20Information) - The company operates in two reportable segments: title insurance and exchange services, with other immaterial segments combined into 'All Other'[34](index=34&type=chunk) Segment Performance (3 Months Ended June 30, 2025) | Segment | Total Revenues (in thousands) | Income before Income Taxes (in thousands) | | :---------------------------------------- | :---------------------------- | :---------------------------------------- | | Title Insurance | $70,648 | $12,765 | | Exchange Services | $3,533 | $2,840 | | All Other | $3,750 | $347 | | Total | $73,649 | $15,798 | Segment Performance (6 Months Ended June 30, 2025) | Segment | Total Revenues (in thousands) | Income before Income Taxes (in thousands) | | :---------------------------------------- | :---------------------------- | :---------------------------------------- | | Title Insurance | $125,270 | $14,512 | | Exchange Services | $6,569 | $5,151 | | All Other | $6,462 | $496 | | Total | $130,214 | $19,851 | [Note 5 – Retirement Agreements and Other Postretirement Benefits](index=14&type=section&id=Note%205%20%E2%80%93%20Retirement%20Agreements%20and%20Other%20Postretirement%20Benefits) - The company's subsidiary, ITIC, has employment agreements with key executives providing for post-retirement benefits, estimated at **$15.5 million as of June 30, 2025**[38](index=38&type=chunk) | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | | Net periodic benefit cost | $15 | $12 | $16 | $23 | [Note 6 – Investments and Estimated Fair Value](index=15&type=section&id=Note%206%20%E2%80%93%20Investments%20and%20Estimated%20Fair%20Value) | Investment Type | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :---------------------------------------- | :----------------------------- | :------------------------------- | | Fixed maturity securities, available-for-sale, at fair value | $118,450 | $112,972 | | Equity securities, at fair value | $34,798 | $39,893 | | Short-term investments | $60,376 | $59,101 | | Other investments | $23,029 | $20,578 | | Total investments | $236,653 | $232,544 | Fixed Maturity Securities (June 30, 2025) | Fixed Maturity Securities | Amortized Cost (in thousands) | Estimated Fair Value (in thousands) | | :---------------------------------------- | :---------------------------- | :---------------------------------- | | Due in one year or less | $45,770 | $45,869 | | Due one year through five years | $59,990 | $60,606 | | Due five years through ten years | $6,587 | $6,682 | | Due after ten years | $5,188 | $5,293 | | Total | $117,535 | $118,450 | - The company recorded impairment charges of **$419 thousand on other investments** for the six-month period ended June 30, 2025, compared to **$74 thousand on fixed maturity securities** in the prior year period[43](index=43&type=chunk)[124](index=124&type=chunk) - Management believes unrealized losses on remaining fixed maturity securities are temporary[43](index=43&type=chunk) [Note 7 – Commitments and Contingencies](index=21&type=section&id=Note%207%20%E2%80%93%20Commitments%20and%20Contingencies) - The company is involved in legal proceedings incidental to its business, but potential liability is not expected to be material[62](index=62&type=chunk) - Escrow and trust deposits, and like-kind exchange proceeds (totaling **$347.4 million as of June 30, 2025**) are off-balance sheet but the company remains contingently liable for their disposition[64](index=64&type=chunk)[65](index=65&type=chunk) [Note 8 – Related Party Transactions](index=22&type=section&id=Note%208%20%E2%80%93%20Related%20Party%20Transactions) - The company conducts business with and invests in unconsolidated LLCs, primarily title insurance agencies, accounted for using the equity method[66](index=66&type=chunk) Related Party Balances | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :------------------------------- | | Other investments | $7,657 | $4,950 | | Premium and fees receivable | $2,360 | $1,701 | Related Party Transactions (6 Months Ended) | Metric | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | | Net premiums written | $15,258 | $12,845 | | Non-title services and other investment income | $1,262 | $1,039 | | Commissions to agents | $9,916 | $8,790 | [Note 9 – Intangible Assets, Goodwill and Title Plants](index=22&type=section&id=Note%209%20%E2%80%93%20Intangible%20Assets,%20Goodwill%20and%20Title%20Plants) Intangible Assets, Net | Intangible Asset | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :------------------------------- | | Referral relationships | $7,039 | $8,898 | | Non-compete agreements | $1,626 | $3,155 | | Tradename | $747 | $747 | | Total | $9,412 | $12,800 | | Accumulated amortization | $(5,567) | $(7,354) | | Identifiable intangible assets, net | $3,845 | $5,446 | - The company recognized **$6.8 million in goodwill** and **$1.6 million in title plants** as of June 30, 2025, with no impairments identified during the six-month periods ended June 30, 2025 and 2024[69](index=69&type=chunk) - A decline in goodwill and intangible assets during the six-month period ended June 30, 2025, was due to a transfer of assets to a joint venture[67](index=67&type=chunk) [Note 10 – Accumulated Other Comprehensive Income](index=23&type=section&id=Note%2010%20%E2%80%93%20Accumulated%20Other%20Comprehensive%20Income) | Component | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :---------------------------------------- | :----------------------------- | :------------------------------- | | Unrealized Gains and Losses On Available-for-Sale Securities | $717 | $300 | | Postretirement Benefits Plans | $105 | $55 | | Total Accumulated Other Comprehensive Income | $822 | $355 | - Net current-period other comprehensive income for the six months ended June 30, 2025, was **$467 thousand**, primarily from unrealized gains on available-for-sale securities and postretirement benefit adjustments[70](index=70&type=chunk) [Note 11 – Revenue from Contracts with Customers](index=25&type=section&id=Note%2011%20%E2%80%93%20Revenue%20from%20Contracts%20with%20Customers) - Revenue from contracts with customers primarily includes escrow and other title-related fees, and non-title services, recognized as performance obligations are completed[75](index=75&type=chunk)[76](index=76&type=chunk) Revenue by Category | Revenue Category | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | | Escrow and other title-related fees | $5,694 | $4,801 | $9,586 | $8,524 | | Non-title services | $5,477 | $4,304 | $10,086 | $8,608 | | Total revenue from contracts with customers | $11,171 | $9,105 | $19,672 | $17,132 | | Net premiums written | $54,496 | $51,416 | $100,841 | $91,596 | | Investment-related revenue | $5,074 | $4,700 | $6,644 | $9,753 | | Other | $2,908 | $161 | $3,057 | $360 | | Total revenues | $73,649 | $65,382 | $130,214 | $118,841 | [Note 12 – Leases](index=26&type=section&id=Note%2012%20%E2%80%93%20Leases) - The company primarily accounts for office space leases as operating leases and equipment leases from acquisitions as finance leases[79](index=79&type=chunk) Lease Expenses and Liabilities | Lease Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | | Operating leases expense | $491 | $707 | $1,158 | $1,365 | | Finance leases expense (amortization) | $145 | $61 | $207 | $132 | | Total lease cost (net of sub-lease income) | $614 | $700 | $1,300 | $1,377 | | Lease Liability | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------- | :----------------------------- | :------------------------------- | | Total lease liabilities | $8,010 | $6,356 | Lease Terms and Discount Rates | Lease Term (Years) | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Operating leases | 6.33 | 3.88 | | Finance leases | 2.59 | 2.84 | | Discount Rate | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Operating leases | 4.1% | 4.0% | | Finance leases | 4.6% | 4.4% | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=28&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial performance and condition, detailing business segments, market trends, critical accounting estimates, and a comprehensive analysis of revenues, operating expenses, liquidity, and capital resources for the periods presented [Overview](index=28&type=section&id=Overview) - The company primarily engages in issuing title insurance through its subsidiaries, ITIC and NITIC, which accounted for **90.5% of total revenues** for the six-month period ended June 30, 2025[86](index=86&type=chunk) - The title insurance business is cyclical and seasonal, heavily influenced by residential and commercial real estate activity, mortgage financing, and interest rate volatility[93](index=93&type=chunk)[95](index=95&type=chunk) [Exchange Services](index=30&type=section&id=Exchange%20Services) - The exchange services division (ITEC and ITAC) facilitates tax-deferred real property exchanges, earning fees and interest on client deposits[97](index=97&type=chunk) - ITAC serves as an exchange accommodation titleholder for 'parking transactions' like reverse or 'build to suit' exchanges[97](index=97&type=chunk) [Management Services, Investment Management and Trust Services](index=30&type=section&id=Management%20Services,%20Investment%20Management%20and%20Trust%20Services) - Other services, grouped under 'All Other,' include consulting and management services for title insurance agencies (ITMS) and investment management and trust services (Investors Trust)[98](index=98&type=chunk)[99](index=99&type=chunk) [Business Trends and Recent Conditions](index=30&type=section&id=Business%20Trends%20and%20Recent%20Conditions) - The housing market is significantly influenced by government policies, overall economic conditions, regulatory reform, and the Federal Reserve's monetary policy[100](index=100&type=chunk) - Inflation, geopolitical conflicts, and changes in government regulations have created volatile market conditions, impacting the company's investment portfolio and net premiums written[101](index=101&type=chunk) - The FOMC reduced the target federal funds rate to a range of **4.25% to 4.50%** in December 2024 and has kept it unchanged so far in 2025[102](index=102&type=chunk) - The MBA Forecast projects a **13.6% increase in total mortgage originations to $2,021 billion** in 2025, with purchase activity increasing by **5.4%** and refinance activity by **35.2%**[103](index=103&type=chunk) - Average 30-year fixed mortgage interest rates were **6.8%** for the six months ended June 30, 2025, projected to decrease to **6.3% by 2027**[103](index=103&type=chunk) [Critical Accounting Estimates and Policies](index=31&type=section&id=Critical%20Accounting%20Estimates%20and%20Policies) - No material changes were made to the company's critical accounting policies during the six-month period ended June 30, 2025[105](index=105&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) Consolidated Revenues and Net Income | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | YoY Change (3M) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | YoY Change (6M) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | | Total Revenues | $73,649 | $65,382 | 12.65% | $130,214 | $118,841 | 9.57% | | Net Income | $12,278 | $8,871 | 38.41% | $15,449 | $13,396 | 15.32% | | Basic EPS | $6.51 | $4.71 | 38.22% | $8.19 | $7.10 | 15.35% | Net Premiums Written | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | YoY Change (3M) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | YoY Change (6M) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | | Net Premiums Written | $54,496 | $51,416 | 6.0% | $100,841 | $91,596 | 10.1% | | Direct Net Premiums (6M) | $29,357 | $28,852 | 1.8% | | | | | Agency Net Premiums (6M) | $71,484 | $62,744 | 13.9% | | | | Non-Title Service and Investment-Related Revenues | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | YoY Change (3M) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | YoY Change (6M) | | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | | Escrow and Other Title-Related Fees | $5,694 | $4,801 | 18.6% | $9,586 | $8,524 | 12.5% | | Non-Title Services Revenue | $5,477 | $4,304 | 27.3% | $10,086 | $8,608 | 17.2% | | Interest and Dividends | $2,361 | $2,568 | -8.0% | $4,700 | $5,088 | -7.5% | | Net Investment Gains | $2,104 | $1,242 | 69.4% | $925 | $3,664 | -74.8% | | Other Revenues | $2,908 | $161 | 1706.2% | $3,057 | $360 | 749.2% | Operating Expenses | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | YoY Change (3M) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | YoY Change (6M) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | | Total Operating Expenses | $57,851 | $54,115 | 6.9% | $110,363 | $101,777 | 8.4% | | Commissions to Agents | $29,077 | $26,550 | 9.5% | $53,934 | $46,420 | 16.2% | | Provision for Claims | $2,080 | $905 | 129.8% | $2,403 | $1,815 | 32.4% | | Personnel Expenses | $17,460 | $18,154 | -3.8% | $35,794 | $36,736 | -2.6% | | Office and Technology Expenses | $4,327 | $4,308 | 0.4% | $8,867 | $8,773 | 1.1% | | Other Expenses | $4,907 | $4,198 | 16.9% | $9,365 | $8,033 | 16.6% | Income Taxes | Metric | 3 Months Ended June 30, 2025 (in thousands) | 3 Months Ended June 30, 2024 (in thousands) | YoY Change (3M) | 6 Months Ended June 30, 2025 (in thousands) | 6 Months Ended June 30, 2024 (in thousands) | YoY Change (6M) | | :-------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | :---------------------------------------- | :---------------------------------------- | :-------------- | | Provision for Income Taxes | $3,520 | $2,396 | 47.1% | $4,402 | $3,668 | 20.0% | | Effective Income Tax Rate | 22.3% | 21.3% | 1.0 pp | 22.2% | 21.5% | 0.7 pp | [Liquidity and Capital Resources](index=38&type=section&id=Liquidity%20and%20Capital%20Resources) - Net cash provided by operating activities was **$8.8 million** for the six-month period ended June 30, 2025, a decrease from **$9.9 million** in the prior year[146](index=146&type=chunk) - As of June 30, 2025, the company maintained high liquidity with **$29.7 million in cash and cash equivalents**, **$60.4 million in short-term investments**, **$118.5 million in available-for-sale fixed maturity securities**, and **$34.8 million in equity securities**[148](index=148&type=chunk) - The One Big Beautiful Bill Act (OBBBA), enacted July 4, 2025, is being assessed for its potential impact on future cash flows by accelerating certain tax deductions[142](index=142&type=chunk)[143](index=143&type=chunk) - The total reserve for claims was **$38.1 million** at June 30, 2025, with **$3.2 million for specific claims** and **$34.8 million for incurred but not reported (IBNR) claims**[138](index=138&type=chunk)[157](index=157&type=chunk) - No shares were repurchased in the six-month period ended June 30, 2025, under the existing plan, leaving **413,177 shares authorized for future purchases**[155](index=155&type=chunk)[176](index=176&type=chunk) [Off-Balance Sheet Arrangements](index=41&type=section&id=Off-Balance%20Sheet%20Arrangements) - The company administers escrow and trust deposits, and like-kind exchange funds, which are excluded from the balance sheet but for which the company remains contingently liable[161](index=161&type=chunk)[162](index=162&type=chunk) - Like-kind exchange deposits and reverse exchange property totaled approximately **$347.4 million** as of June 30, 2025, an increase from **$323.5 million** as of December 31, 2024[162](index=162&type=chunk) [Recent Accounting Standards](index=41&type=section&id=Recent%20Accounting%20Standards) - No recent accounting pronouncements are expected to have a material impact on the company's financial position and results of operations[165](index=165&type=chunk) [Safe Harbor for Forward-Looking Statements](index=41&type=section&id=Safe%20Harbor%20for%20Forward-Looking%20Statements) - Forward-looking statements are subject to various risks and uncertainties, including changes in interest rates, real estate values, economic conditions, government regulations, inflation, and geopolitical conflicts[166](index=166&type=chunk) - Other significant risks include potential inadequacy of claims provision, cybersecurity events, intense competition, reliance on key markets, regulatory compliance, and dependence on key management personnel[171](index=171&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=43&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section outlines the company's primary market risk exposures, which are fluctuations in interest rates and equity market values, and confirms that derivative financial instruments are not currently used for hedging purposes - The company's primary market risk exposures are related to fluctuations in interest rates and equity market values[168](index=168&type=chunk) - The company does not currently utilize derivative financial instruments for hedging purposes[168](index=168&type=chunk) [Item 4. Controls and Procedures](index=43&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the company's disclosure controls and procedures, which were evaluated and concluded to be effective as of June 30, 2025. It also states that there were no material changes in internal control over financial reporting during the quarter - The company's disclosure controls and procedures were evaluated and deemed effective as of June 30, 2025, providing reasonable assurance that objectives are met[172](index=172&type=chunk) - There were no material changes in the company's internal control over financial reporting during the quarter ended June 30, 2025[173](index=173&type=chunk) [PART II. OTHER INFORMATION](index=45&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=45&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 7 of the Consolidated Financial Statements, indicating that legal proceedings are incidental to the company's business and are not expected to have a material impact on its consolidated financial condition or operations - Legal proceedings are incidental to the company's business and are not expected to be material to its consolidated financial condition or operations[62](index=62&type=chunk)[174](index=174&type=chunk) [Item 1A. Risk Factors](index=45&type=page&id=Item%201A.%20Risk%20Factors) This section states that there have been no material changes to the risk factors previously disclosed in the company's 2024 Form 10-K - There have been no material changes in the risk factors previously disclosed under Item 1A of the company's 2024 Form 10-K[175](index=175&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports that the company made no repurchases of its common stock during the quarter ended June 30, 2025, under its publicly announced repurchase plan, with 413,177 shares remaining authorized for purchase - The company purchased no shares of common stock during the quarter ended June 30, 2025[176](index=176&type=chunk) - As of June 30, 2025, there was authority remaining to purchase up to an aggregate of **413,177 shares** under the repurchase plan[176](index=176&type=chunk) [Item 3. Defaults Upon Senior Securities](index=45&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This section confirms that there were no defaults upon senior securities during the reporting period - There were no defaults upon senior securities[177](index=177&type=chunk) [Item 4. Mine Safety Disclosures](index=45&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section states that the disclosure requirement for mine safety is not applicable to the company - Mine Safety Disclosures are not applicable to the company[178](index=178&type=chunk) [Item 5. Other Information](index=45&type=section&id=Item%205.%20Other%20Information) This section reports that none of the company's directors or executive officers adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the three-month period ended June 30, 2025 - None of the company's directors or executive officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the three-month period ended June 30, 2025[179](index=179&type=chunk) [Item 6. Exhibits](index=46&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed as part of the Form 10-Q, including various certifications and XBRL-related documents - Exhibits include certifications of the Chief Executive Officer and Chief Financial Officer pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, and Inline XBRL documents[181](index=181&type=chunk) [SIGNATURE](index=47&type=section&id=SIGNATURE) - The report was signed on August 8, 2025, by James A. Fine, Jr., President, Treasurer, Chief Financial Officer, Chief Accounting Officer, and Director[184](index=184&type=chunk)

[Second Quarter and Year-to-Date 2025 Financial Results Overview](index=1&type=section&id=1.%20Second%20Quarter%20and%20Year-to-Date%202025%20Financial%20Results%20Overview) This section reviews the company's financial performance for Q2 and YTD 2025, detailing key results and management insights [Second Quarter 2025 Performance Summary](index=1&type=section&id=1.1%20Second%20Quarter%202025%20Performance%20Summary) The company reported strong Q2 2025 performance with significant increases in net income and revenues, driven by real estate activity Second Quarter 2025 Key Financial Highlights (YoY Change) | Metric | Q2 2025 | Q2 2024 | Change | % Change | | :-------------------------------- | :------ | :------ | :----- | :------- | | Net Income | $12.3 million | $8.9 million | +$3.4 million | +38.2% | | Diluted EPS | $6.48 | $4.70 | +$1.78 | +37.9% | | Total Revenues | $73.6 million | $65.4 million | +$8.2 million | +12.6% | | Operating Expenses | $57.9 million | $54.1 million | +$3.8 million | +6.9% | | Income before Income Taxes (GAAP) | $15.8 million | $11.3 million | +$4.5 million | +39.8% | | Adjusted Income before Income Taxes (non-GAAP) | $13.7 million | $10.0 million | +$3.7 million | +37.0% | - Revenue increase of **$8.2 million** was driven by: * **$4.0 million** increase in net premiums written and escrow and title-related fees, primarily due to higher real estate activity levels * **$2.7 million** increase in other revenue from a gain on assets transferred to a joint venture * **$1.2 million** increase in non-title services revenue, mainly from like-kind exchanges and management services * **$862 thousand** increase in net investment gains due to changes in the estimated fair value of equity security investments[2](index=2&type=chunk) - Operating expenses increased by **$3.8 million**, largely due to: * Higher agent commissions, corresponding with growth in agent business * Increased provision for claims, driven by higher reserves on reported claims and a reduction in favorable loss development[3](index=3&type=chunk) [Year-to-Date 2025 Performance Summary](index=2&type=section&id=1.2%20Year-to-Date%202025%20Performance%20Summary) The company achieved positive year-to-date growth in net income and revenues, with lower net investment gains impacting overall results Six Months Ended June 30, 2025 Key Financial Highlights (YoY Change) | Metric | YTD 2025 | YTD 2024 | Change | % Change | | :-------------------------------- | :------- | :------- | :----- | :------- | | Net Income | $15.4 million | $13.4 million | +$2.0 million | +14.9% | | Diluted EPS | $8.16 | $7.10 | +$1.06 | +14.9% | | Total Revenues | $130.2 million | $118.8 million | +$11.4 million | +9.6% | | Operating Expenses | $110.4 million | $101.8 million | +$8.6 million | +8.4% | | Income before Income Taxes (GAAP) | $19.9 million | $17.1 million | +$2.8 million | +16.4% | | Adjusted Income before Income Taxes (non-GAAP) | $18.9 million | $13.4 million | +$5.5 million | +41.0% | - Overall year-to-date results were predominantly shaped by the same factors affecting the second quarter, with one notable exception: * Lower net investment gains for the first six months of 2025 compared to the prior year period, driven by negative changes in the estimated fair value of equity security investments and a decrease in realized gains from the sale of investment securities[5](index=5&type=chunk) [Management Insights and Business Outlook](index=2&type=section&id=1.3%20Management%20Insights%20and%20Business%20Outlook) Management is satisfied with the strongest quarterly performance in over three years, driven by broad-based revenue growth - The company reported its **strongest quarterly performance in over three years**, reflecting solid execution and broad-based revenue growth[6](index=6&type=chunk) - Increased profitability was largely driven by growth in title insurance revenues, supported by increases in non-title business segments, especially the like-kind exchange subsidiary[6](index=6&type=chunk) - Incoming order volumes in the second quarter exceeded those of the same period last year, leading to a stronger pipeline of open orders entering the third quarter, which is expected to drive continued momentum[7](index=7&type=chunk) - Investors Title Company's subsidiaries issue and underwrite title insurance policies, and the company also provides investment management services and services for tax-deferred exchanges of like-kind property[7](index=7&type=chunk) [Consolidated Financial Statements](index=4&type=section&id=2.%20Consolidated%20Financial%20Statements) This section presents the company's detailed consolidated financial statements, including operations, balance sheets, and premium breakdowns [Consolidated Statements of Operations](index=4&type=section&id=2.1%20Consolidated%20Statements%20of%20Operations) This statement details revenues and operating expenses for Q2 and YTD 2025, highlighting key drivers and significant costs Consolidated Revenues (in thousands) | Revenue Category | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------ | :------ | :------ | :------- | :------- | | Net premiums written | $54,496 | $51,416 | $100,841 | $91,596 | | Escrow and other title-related fees | $5,694 | $4,801 | $9,586 | $8,524 | | Non-title services | $5,477 | $4,304 | $10,086 | $8,608 | | Interest and dividends | $2,361 | $2,568 | $4,700 | $5,088 | | Other investment income | $609 | $890 | $1,019 | $1,001 | | Net investment gains | $2,104 | $1,242 | $925 | $3,664 | | Other | $2,908 | $161 | $3,057 | $360 | | **Total Revenues** | **$73,649** | **$65,382** | **$130,214** | **$118,841** | Consolidated Operating Expenses (in thousands) | Expense Category | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :------------------------ | :------ | :------ | :------- | :------- | | Commissions to agents | $29,077 | $26,550 | $53,934 | $46,420 | | Provision for claims | $2,080 | $905 | $2,403 | $1,815 | | Personnel expenses | $17,460 | $18,154 | $35,794 | $36,736 | | Office and technology expenses | $4,327 | $4,308 | $8,867 | $8,773 | | Other expenses | $4,907 | $4,198 | $9,365 | $8,033 | | **Total Operating Expenses** | **$57,851** | **$54,115** | **$110,363** | **$101,777** | Net Income and EPS (in thousands, except per share amounts) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------- | :------- | | Income before Income Taxes | $15,798 | $11,267 | $19,851 | $17,064 | | Provision for Income Taxes | $3,520 | $2,396 | $4,402 | $3,668 | | **Net Income** | **$12,278** | **$8,871** | **$15,449** | **$13,396** | | Basic Earnings per Common Share | $6.51 | $4.71 | $8.19 | $7.10 | | Diluted Earnings per Common Share | $6.48 | $4.70 | $8.16 | $7.10 | [Consolidated Balance Sheets](index=5&type=section&id=2.2%20Consolidated%20Balance%20Sheets) This statement presents the company's financial position, showing increased assets and equity, with a slight decrease in liabilities Consolidated Assets (in thousands) | Asset Category | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Cash and cash equivalents | $29,683 | $24,654 | | Total investments | $236,653 | $232,544 | | Premiums and fees receivable | $16,973 | $16,054 | | Property, net | $28,480 | $27,935 | | Goodwill and other intangible assets, net | $10,617 | $15,071 | | **Total Assets** | **$345,824** | **$333,571** | Consolidated Liabilities and Stockholders' Equity (in thousands) | Category | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Reserve for claims | $38,051 | $37,060 | | Accounts payable and accrued liabilities | $29,791 | $34,011 | | Total liabilities | $79,647 | $81,798 | | Retained earnings | $265,355 | $251,418 | | Accumulated other comprehensive income | $822 | $355 | | **Total stockholders' equity** | **$266,177** | **$251,773** | | **Total Liabilities and Stockholders' Equity** | **$345,824** | **$333,571** | [Direct and Agency Net Premiums Written](index=6&type=section&id=2.3%20Direct%20and%20Agency%20Net%20Premiums%20Written) This section details net premiums written by direct and agency channels, with agency consistently forming the majority Direct and Agency Net Premiums Written (in thousands) | Channel | Q2 2025 | % of Total | Q2 2024 | % of Total | YTD 2025 | % of Total | YTD 2024 | % of Total | | :------ | :------ | :--------- | :------ | :--------- | :------- | :--------- | :------- | :--------- | | Direct | $15,823 | 29.0% | $15,531 | 30.2% | $29,357 | 29.1% | $28,852 | 31.5% | | Agency | $38,673 | 71.0% | $35,885 | 69.8% | $71,484 | 70.9% | $62,744 | 68.5% | | **Total** | **$54,496** | **100.0%** | **$51,416** | **100.0%** | **$100,841** | **100.0%** | **$91,596** | **100.0%** | [Non-GAAP Financial Measures Reconciliation](index=7&type=section&id=3.%20Non-GAAP%20Financial%20Measures%20Reconciliation) This section reconciles non-GAAP financial measures to GAAP, providing adjusted views of revenues and income [Non-GAAP Measures Reconciliation](index=7&type=section&id=3.1%20Non-GAAP%20Measures%20Reconciliation) Management uses non-GAAP measures to evaluate operational performance by excluding net investment gains and losses for clearer internal views - Management uses non-GAAP measures, such as adjusted revenues and adjusted income before income taxes, to analyze Company performance by removing the impact of net investment gains and losses[17](index=17&type=chunk) - These non-GAAP measures are considered useful for evaluating internal operational performance from period to period as they eliminate the effects of external market fluctuations[17](index=17&type=chunk) Reconciliation of Non-GAAP Financial Measurements (in thousands) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :-------------------------------- | :------ | :------ | :------- | :------- | | Total revenues (GAAP) | $73,649 | $65,382 | $130,214 | $118,841 | | Subtract: Net investment gains | (2,104) | (1,242) | (925) | (3,664) | | **Adjusted revenues (non-GAAP)** | **$71,545** | **$64,140** | **$129,289** | **$115,177** | | Income before income taxes (GAAP) | $15,798 | $11,267 | $19,851 | $17,064 | | Subtract: Net investment gains | (2,104) | (1,242) | (925) | (3,664) | | **Adjusted income before income taxes (non-GAAP)** | **$13,694** | **$10,025** | **$18,926** | **$13,400** | [Cautionary Statements Regarding Forward-Looking Statements](index=3&type=section&id=4.%20Cautionary%20Statements%20Regarding%20Forward-Looking%20Statements) This section outlines cautionary statements regarding forward-looking information, detailing inherent risks and uncertainties [Cautionary Statements Regarding Forward-Looking Statements](index=3&type=section&id=4.1%20Cautionary%20Statements%20Regarding%20Forward-Looking%20Statements) This section outlines forward-looking statements, subject to risks and uncertainties that could cause actual results to differ - The document contains forward-looking statements identified by words such as 'plan,' 'expect,' 'aim,' 'believe,' 'project,' 'anticipate,' 'intend,' 'estimate,' 'should,' 'could,' 'would,' and other expressions indicating future events and trends[8](index=8&type=chunk) - These statements involve risks and uncertainties that could cause actual results to differ materially from anticipated and historical results[8](index=8&type=chunk) - Key risks and uncertainties include: * Cyclical demand for title insurance due to real estate market changes * Occurrence of fraud, defalcation, or misconduct * Variances between actual claims experience and underwriting/reserving assumptions * Declines in investment performance * Changes in government regulations and policy, including tariffs and taxes * Changes in the economy, inflation, and interest rates * Loss of agency relationships or significant reductions in agent-originated business * Difficulties managing growth[8](index=8&type=chunk)

Core Insights - Investors Title Company (ITIC) reported a net income of $1.67 per share for Q1 2025, a 30.4% decrease from $2.40 per share in the same period last year [2][3] - The company's revenues increased by 5.8% to $56.6 million, driven by a 15.3% rise in net premiums written, indicating stronger activity in key markets [2][4] - Operating expenses rose by 10.2% to $52.5 million, primarily due to increased agent commissions, while personnel costs remained flat [5][6] Financial Performance - Net income declined to $3.2 million from $4.5 million year-over-year, attributed to higher operating expenses and a $3.6 million swing in investment gains [3][7] - Net premiums written totaled $46.3 million, up from $40.2 million in the prior-year quarter, with direct premiums at $13.5 million and agency premiums at $32.8 million [4][5] - Adjusted income before income taxes increased by 53% to $5.2 million from $3.4 million in the previous year, indicating improved core business performance [8] Management Commentary - Chairman J. Allen Fine noted positive momentum in premium growth and attributed it to modest market improvements and efforts to expand market presence [6] - Management acknowledged that expense growth was mainly tied to volume-related commissions, while fixed overhead costs were lower year-over-year due to successful cost-saving strategies [6] Market Context - The stock of Investors Title Company gained 1.4% since the earnings report, underperforming compared to the S&P 500's 4.5% growth during the same period [1] - Over the past month, the stock increased by 5.9%, while the S&P 500 rose by 8.8%, indicating a relatively underwhelming performance in the broader market context [1]

Revenue and Premiums - Total revenues for the title insurance segment accounted for 90.4% of the Company's revenues for the three-month period ended March 31, 2025[84]. - Net premiums written increased 15.3% for the three-month period ended March 31, 2025, reaching $46.3 million compared to $40.2 million for the same prior year period[107]. - Agency net premiums written increased 22.2% for the three-month period ended March 31, 2025, primarily due to higher activity levels across key markets[110]. - Total revenues for the three-month period ended March 31, 2025, were $56.6 million, compared to $53.5 million for the same period in 2024[104]. - Net premiums written for the three-month period ended March 31, 2025, increased to $46,345 thousand, up from $40,180 thousand in the same period of 2024, representing a growth of 15.4%[111]. - Revenue from non-title services increased to $4.6 million for the three-month period ended March 31, 2025, up from $4.3 million in the same prior year period, reflecting a growth of 7.0%[113]. Income and Expenses - Net income for the three-month period ended March 31, 2025, was $3.2 million, down from $4.5 million in the same prior year period[104]. - The Company's operating expenses for the three-month period ended March 31, 2025, totaled $52.5 million, compared to $47.7 million for the same period in 2024[104]. - Operating expenses increased by 10.2% for the three-month period ended March 31, 2025, totaling $52,512 thousand, compared to $47,662 thousand in the same prior year period[128]. - Interest and dividends income decreased to $2.3 million for the three-month period ended March 31, 2025, from $2.5 million in the same prior year period[104]. - Interest and dividends decreased to $2.3 million for the three-month period ended March 31, 2025, down from $2.5 million in the same prior year period, a decline of 8.0%[118]. Claims and Reserves - The provision for claims decreased by 64.5% for the three-month period ended March 31, 2025, with claims totaling $386 thousand compared to $741 thousand in the same prior year period[135]. - The total reserve for claims as of March 31, 2025, was $37.0 million, with approximately $2.5 million reserved for specific claims[137]. - The Company had a claims reserve totaling $37.0 million as of March 31, 2025, with potential variability in future payments due to economic conditions[157]. Cash and Investments - Net cash used in operating activities was $(75) thousand for Q1 2025, compared to $1.4 million for Q1 2024[146]. - As of March 31, 2025, the Company held cash and cash equivalents of $27.6 million, short-term investments of $54.1 million, and available-for-sale fixed maturity securities of $118.3 million[148]. - The net effect of all activities on total cash and cash equivalents was an increase of $2.9 million in 2025[148]. - Like-kind exchange deposits held by the Company totaled approximately $362.1 million as of March 31, 2025, up from $323.5 million at the end of 2024[162]. Strategic Initiatives - The company is evaluating nonorganic growth opportunities, including mergers and acquisitions, as part of its ongoing business strategy[142]. - The Company anticipates making further stock repurchases under its plan, having purchased no shares in Q1 2025 and 6,763 shares in Q1 2024[155]. - The Company’s capital resources are influenced by state regulations and the need to maintain superior financial ratings[149]. - The Company’s title insurance subsidiaries met the minimum capital, surplus, and reserve requirements for their respective states as of March 31, 2025[151]. Market Conditions - The average 30-year fixed mortgage interest rates were 6.8% for the three-month period ended March 31, 2025, compared to 6.7% for the same period in 2024[101]. - The Mortgage Bankers Association projects a 16.7% net increase in total mortgage originations to $2,076 billion in 2025 from 2024 levels[101]. - The Company's profitability is influenced by the overall level of residential and commercial real estate activity, which is cyclical and affected by various economic factors[91]. Financial Instruments and Risk Management - The Company does not currently utilize derivative financial instruments for hedging purposes, actively monitoring market risks related to interest rates and equity values[168]. - Other investment income rose significantly to $410 thousand for the three-month period ended March 31, 2025, compared to $111 thousand for the same prior year period, marking an increase of 269.4%[120]. - The effective income tax rate for the three-month period ended March 31, 2025, was 21.8%, slightly down from 21.9% in the same prior year period[139]. - Capital expenditures for Q1 2025 were approximately $1.3 million, with plans for technology and system development initiatives funded by cash flows from operations[156].