HOUSTON--(BUSINESS WIRE)--In response to FinCEN's new Anti-Money Laundering Rule (AML), for which the reporting requirements have been delayed until March 1, 2026, Stewart Information Services Corporation (NYSE:STC) has launched FINCEN Reporting Services (FRS), a solution designed to take the pressure off its title and closing customers by collecting data, validating reportability, communicating with buyers and sellers, electronically filing required FinCEN reports, and retaining required docum. ...

HOUSTON--(BUSINESS WIRE)--Stewart Information Services Corporation (NYSE: STC) today announced entry into a new credit facility. On October 7, 2025, Stewart entered into a new Credit Agreement comprised of a $300 million revolving credit facility with a five-year maturity, to October 2030. This new facility provides an additional $100 million in revolving credit above the previous facility placed for Stewart in October 2021. The previous Credit Agreement was terminated on October 7, 2025, in co. ...

Core Insights - Stewart Information Services Corporation has been recognized on Forbes' inaugural list of America's Best Employers for Company Culture 2025, highlighting the company's strong workplace culture [1] Company Recognition - The award is presented in collaboration with Statista, a leading statistics portal and industry ranking provider [1] - The recognition reflects the company's commitment to fostering a positive and engaging work environment [1]

Core Points - The Federal Aviation Administration (FAA) has granted Avcon Industries, Inc. and Butler Avionics Inc. a Supplemental Type Certificate (STC) for the installation of non-halon portable fire extinguishers in various Learjet models [1][2] - The new Halotron BrX-filled fire extinguishers are designed for easy retrofit and compliance with European Union Aviation Safety Agency (EASA) requirements, with an application for EASA validation underway [2][4] - Halon, an ozone-depleting substance, has been banned in EU member states since 1994, and regulatory bodies require the replacement of hand-held Halon fire extinguishers in aircraft by December 31, 2025 [3] Company Overview - Butler Avionics, Inc. has been providing avionics integration, installation, and repair services since 1969, working closely with its parent company, Butler National Corporation, and affiliate Avcon Industries, Inc. [5] - Avcon Industries, Inc. specializes in the modification of business and commercial aircraft, focusing on complex structural modifications and system integrations across various sectors, including air ambulance and Intelligence, Surveillance, and Reconnaissance (ISR) [6][7] - Avcon is recognized for its solutions to regulatory-driven aircraft modifications and is a wholly owned subsidiary of Butler National Corporation, which is publicly traded under the ticker symbol OTCQX: BUKS [7]

PART I – FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents unaudited condensed consolidated financial statements and detailed notes on accounting policies, revenues, investments, and segment performance [Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited)](index=3&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME%20AND%20COMPREHENSIVE%20INCOME%20(UNAUDITED)) This statement details the company's revenues, expenses, net income, and comprehensive income for the specified periods Condensed Consolidated Statements of Income and Comprehensive Income (Unaudited) | Metric | Three Months Ended June 30, 2025 ($'000) | Three Months Ended June 30, 2024 ($'000) | Six Months Ended June 30, 2025 ($'000) | Six Months Ended June 30, 2024 ($'000) | | :--------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | **Revenues ($'000)** | | | | | | Direct title revenues | 291,262 | 255,480 | 522,942 | 466,068 | | Agency title revenues | 301,285 | 240,760 | 568,803 | 481,532 | | Real estate solutions | 112,650 | 92,198 | 209,727 | 175,214 | | Operating revenues | 705,197 | 588,438 | 1,301,472 | 1,122,814 | | Investment income | 16,257 | 14,306 | 28,913 | 27,207 | | Net realized and unrealized gains (losses) | 727 | (514) | 3,780 | 6,524 | | **Total Revenues ($'000)** | **722,181** | **602,230** | **1,334,165** | **1,156,545** | | **Expenses ($'000)** | | | | | | Amounts retained by agencies | 252,112 | 200,126 | 473,489 | 400,102 | | Employee costs | 208,209 | 179,708 | 394,019 | 352,125 | | Other operating expenses | 173,527 | 152,291 | 334,439 | 289,244 | | Title losses and related claims | 21,454 | 21,090 | 39,156 | 38,472 | | Depreciation and amortization | 15,150 | 15,198 | 30,472 | 30,582 | | Interest | 4,953 | 4,812 | 9,914 | 9,869 | | **Total Expenses ($'000)** | **675,405** | **573,225** | **1,281,489** | **1,120,394** | | **Income before taxes and noncontrolling interests ($'000)** | **46,776** | **29,005** | **52,676** | **36,151** | | Income tax expense ($'000) | (11,141) | (7,940) | (11,625) | (8,876) | | **Net income attributable to Stewart ($'000)** | **31,922** | **17,343** | **34,999** | **20,473** | | Basic earnings per share attributable to Stewart ($) | 1.14 | 0.63 | 1.26 | 0.74 | | Diluted earnings per share attributable to Stewart ($) | 1.13 | 0.62 | 1.24 | 0.73 | | Comprehensive income attributable to Stewart ($'000) | 46,376 | 16,591 | 55,824 | 13,125 | - Net income attributable to Stewart increased significantly for both the three months ended June 30, 2025, by **84%** to **$31.9 million**, and for the six months ended June 30, 2025, by **71%** to **$35.0 million**, compared to the respective prior year periods[11](index=11&type=chunk) - Diluted EPS attributable to Stewart rose to **$1.13** for Q2 2025 (from **$0.62** in Q2 2024) and to **$1.24** for the first six months of 2025 (from **$0.73** in the same period of 2024)[11](index=11&type=chunk) - Total revenues for the three months ended June 30, 2025, increased by **19.9%** to **$722.2 million**, and for the six months ended June 30, 2025, increased by **15.4%** to **$1,334.2 million**, driven by growth across direct title, agency title, and real estate solutions revenues[11](index=11&type=chunk) [Condensed Consolidated Balance Sheets](index=4&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) This statement provides a snapshot of the company's assets, liabilities, and equity at specific reporting dates Condensed Consolidated Balance Sheets | Metric | June 30, 2025 ($'000) | December 31, 2024 ($'000) | | :--------------------------------- | :-------------------- | :------------------------ | | **Assets** | | | | Cash and cash equivalents | 178,101 | 216,298 | | Short-term investments | 45,731 | 41,199 | | Investments, at fair value | 689,743 | 669,099 | | Total Receivables | 166,067 | 140,763 | | Property and equipment, net | 83,167 | 87,613 | | Operating lease assets | 113,615 | 102,210 | | Goodwill | 1,092,747 | 1,084,139 | | Intangible assets, net | 158,348 | 173,075 | | Other assets | 173,888 | 136,060 | | **Total Assets** | **2,781,157** | **2,730,145** | | **Liabilities** | | | | Notes payable | 446,000 | 445,841 | | Accounts payable and accrued liabilities | 203,903 | 214,580 | | Operating lease liabilities | 129,787 | 118,835 | | Estimated title losses | 523,085 | 511,534 | | Deferred tax liabilities | 32,100 | 28,266 | | **Total Liabilities** | **1,334,875** | **1,319,056** | | **Stockholders' Equity** | | | | Stockholders' equity attributable to Stewart | 1,437,751 | 1,402,142 | | Noncontrolling interests | 8,531 | 8,947 | | **Total Stockholders' Equity** | **1,446,282** | **1,411,089** | | **Total Liabilities and Stockholders' Equity** | **2,781,157** | **2,730,145** | - Total assets increased by **$51.0 million** to **$2,781.2 million** as of June 30, 2025, from **$2,730.1 million** at December 31, 2024, primarily driven by increases in investments, receivables, and goodwill[13](index=13&type=chunk) - Stockholders' equity attributable to Stewart increased by **$35.6 million** to **$1,437.8 million** as of June 30, 2025, from **$1,402.1 million** at December 31, 2024[13](index=13&type=chunk) - Estimated title losses increased to **$523.1 million** at June 30, 2025, from **$511.5 million** at December 31, 2024[13](index=13&type=chunk) [Condensed Consolidated Statements of Cash Flows (Unaudited)](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS%20(UNAUDITED)) This statement outlines the cash inflows and outflows from operating, investing, and financing activities for the period Condensed Consolidated Statements of Cash Flows (Unaudited) | Cash Flow Activity | Six Months Ended June 30, 2025 ($'000) | Six Months Ended June 30, 2024 ($'000) | | :--------------------------------------- | :------------------------------------- | :------------------------------------- | | Net income | 41,051 | 27,275 | | Cash provided (used) by operating activities | 23,501 | (8,465) | | Cash used by investing activities | (29,496) | (56,271) | | Cash used by financing activities | (35,521) | (33,568) | | Effects of changes in foreign currency exchange rates | 3,319 | (1,656) | | Change in cash and cash equivalents | (38,197) | (99,960) | | Cash and cash equivalents at end of period | 178,101 | 133,405 | - Net cash provided by operating activities significantly improved to **$23.5 million** for the first six months of 2025, compared to net cash used of **$8.5 million** in the same period of 2024, primarily due to higher net income and lower claims payments[14](index=14&type=chunk)[105](index=105&type=chunk) - Cash used by investing activities decreased to **$29.5 million** for the first six months of 2025, from **$56.3 million** in the prior year, mainly due to lower purchases of cost-basis and other investments[14](index=14&type=chunk)[106](index=106&type=chunk) - Cash used by financing activities increased to **$35.5 million** for the first six months of 2025, from **$33.6 million** in the prior year, primarily due to higher cash dividends paid[14](index=14&type=chunk) [Condensed Consolidated Statements of Equity (Unaudited)](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20EQUITY%20(UNAUDITED)) This statement details changes in each component of stockholders' equity, including net income, dividends, and other comprehensive income Condensed Consolidated Statements of Equity (Unaudited) | Equity Component | Balance at Dec 31, 2024 ($'000) | Net Income Attributable to Stewart ($'000) | Dividends on Common Stock ($'000) | Stock-based Compensation ($'000) | Stock Repurchases ($'000) | Other Comprehensive Income (Loss) ($'000) | Balance at Jun 30, 2025 ($'000) | | :--------------------------------- | :------------------------------ | :----------------------------------------- | :-------------------------------- | :------------------------------- | :------------------------ | :---------------------------------------- | :------------------------------ | | Common Stock | 28,117 | — | — | 172 | (50) | — | 28,293 | | Additional paid-in capital | 330,604 | — | — | 8,650 | (3,424) | — | 338,673 | | Retained earnings | 1,089,484 | 34,999 | (28,460) | — | — | — | 1,096,023 | | Accumulated other comprehensive loss | (43,397) | — | — | — | — | 20,825 | (22,572) | | Treasury stock | (2,666) | — | — | — | — | — | (2,666) | | Noncontrolling interests | 8,947 | 6,052 | (6,394) | — | — | — | 8,531 | | **Total** | **1,411,089** | **41,051** | **(34,854)** | **8,822** | **(3,474)** | **20,825** | **1,446,282** | - Total stockholders' equity increased by **$35.2 million** from December 31, 2024, to June 30, 2025, reaching **$1,446.3 million**[15](index=15&type=chunk) - Accumulated other comprehensive loss improved significantly, decreasing from **$(43.4) million** at December 31, 2024, to **$(22.6) million** at June 30, 2025, primarily due to positive foreign currency translation adjustments and changes in net unrealized gains on investments[15](index=15&type=chunk) - Dividends on Common Stock for the six months ended June 30, 2025, totaled **$28.46 million** (**$1.00 per share**), an increase from **$26.44 million** (**$0.95 per share**) in the same period of 2024[15](index=15&type=chunk) [NOTE 1 Interim Financial Statements](index=8&type=section&id=NOTE%201%20Interim%20financial%20statements.) This note clarifies the unaudited nature of interim financial statements, statutory reserve restrictions, and new legislation - The financial information for the three and six months ended June 30, 2025 and 2024, is unaudited and prepared in conformity with U.S. GAAP, based on management's best judgments and estimates[21](index=21&type=chunk)[22](index=22&type=chunk) - Statutory reserve funds, totaling approximately **$516.3 million** in debt/equity securities and **$7.4 million** in cash at June 30, 2025, are restricted for statutory premium reserves and are not available for current claim payments or other purposes[24](index=24&type=chunk) - Management's preliminary analysis indicates that the 'One Big Beautiful Bill Act' (OBBBA), signed into law on July 4, 2025, is not expected to have a material impact on the Company's consolidated financial statements[25](index=25&type=chunk) [NOTE 2 Revenues](index=9&type=section&id=NOTE%202%20Revenues.) This note provides a detailed breakdown of operating revenues by type, highlighting growth trends across different segments Operating Revenues by Type | Revenue Type | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Direct title insurance premiums | 200,680 | 173,813 | 363,504 | 315,512 | | Agency title insurance premiums | 301,285 | 240,760 | 568,803 | 481,532 | | Escrow fees | 46,698 | 42,195 | 81,176 | 75,738 | | Real estate solutions and abstract fees | 130,790 | 109,473 | 244,256 | 206,847 | | Other revenues | 25,744 | 22,197 | 43,733 | 43,185 | | **Total Operating Revenues** | **705,197** | **588,438** | **1,301,472** | **1,122,814** | - Total operating revenues increased by **19.8%** for the three months ended June 30, 2025, and by **15.9%** for the six months ended June 30, 2025, compared to the prior year periods, driven by strong growth in both direct and agency title insurance premiums and real estate solutions[27](index=27&type=chunk) [NOTE 3 Investments in Debt and Equity Securities](index=9&type=section&id=NOTE%203%20Investments%20in%20debt%20and%20equity%20securities.) This note details the company's debt and equity securities portfolio, including costs, fair values, and unrealized gains/losses Investments in Debt and Equity Securities | Investment Type | Amortized Costs (Jun 30, 2025, $'000) | Fair Values (Jun 30, 2025, $'000) | Amortized Costs (Dec 31, 2024, $'000) | Fair Values (Dec 31, 2024, $'000) | | :---------------- | :------------------------------------ | :-------------------------------- | :------------------------------------ | :-------------------------------- | | Municipal | 12,322 | 12,248 | 14,563 | 14,415 | | Corporate | 199,623 | 195,174 | 219,015 | 210,307 | | Foreign | 345,501 | 345,388 | 316,247 | 313,619 | | U.S. Treasury Bonds | 52,151 | 52,238 | 49,462 | 48,274 | | **Total Debt Securities** | **609,597** | **605,048** | **599,287** | **586,615** | | Equity Securities | N/A | 84,695 | N/A | 82,484 | - Net unrealized investment gains on equity securities held increased to **$28.2 million** at June 30, 2025, from **$23.2 million** at December 31, 2024[28](index=28&type=chunk) - Total gross unrealized investment losses on debt securities decreased to **$10.1 million** at June 30, 2025, from **$16.2 million** at December 31, 2024, primarily due to lower interest rates in the first six months of 2025[30](index=30&type=chunk)[31](index=31&type=chunk) - As of June 30, 2025, **168 out of 221** debt investment holdings in an unrealized loss position had been in that position for more than 12 months, but these are not considered credit-impaired due to the Company's intent to hold them to maturity and lack of significant credit risk[31](index=31&type=chunk) [NOTE 4 Fair Value Measurements](index=10&type=section&id=NOTE%204%20Fair%20value%20measurements.) This note describes the fair value hierarchy and valuation methods for financial instruments, categorized into Level 1 and Level 2 Fair Value Measurements of Financial Instruments | Financial Instrument | Level 1 (Jun 30, 2025, $ thousands) | Level 2 (Jun 30, 2025, $ thousands) | Fair Value Measurements (Jun 30, 2025, $ thousands) | | :--------------------------------- | :--------------------- | :--------------------- | :------------------------------------- | | Debt securities: | | | | | Municipal | — | 12,248 | 12,248 | | Corporate | — | 195,174 | 195,174 | | Foreign | — | 345,388 | 345,388 | | U.S. Treasury Bonds | — | 52,238 | 52,238 | | Equity securities | 84,695 | — | 84,695 | | **Total Investments in Securities** | **84,695** | **605,048** | **689,743** | - Level 1 financial instruments, primarily equity securities, totaled **$84.7 million** at June 30, 2025, while Level 2 instruments, consisting of various debt securities, amounted to **$605.0 million**[34](index=34&type=chunk) - The fair value of investments is determined using a third-party pricing service, which employs market and model valuation methods, and is verified by management against investment manager pricing information[34](index=34&type=chunk) [NOTE 5 Net Realized and Unrealized Gains (Losses)](index=13&type=section&id=NOTE%205%20Net%20realized%20and%20unrealized%20gains%20(losses).)` This note details net realized and unrealized gains and losses, highlighting their impact on financial performance Net Realized and Unrealized Gains (Losses) | Metric | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Realized gains | 42 | 116 | 598 | 218 | | Realized losses | (1,714) | (89) | (2,392) | (380) | | Net unrealized investment gains (losses) recognized on equity securities still held | 2,399 | (541) | 5,574 | 6,686 | | **Total Net realized and unrealized gains (losses)** | **727** | **(514)** | **3,780** | **6,524** | - The Company reported net realized and unrealized gains of **$0.7 million** for Q2 2025, a significant improvement from net losses of **$0.5 million** in Q2 2024, primarily driven by net unrealized gains on equity securities[36](index=36&type=chunk) - For the first six months of 2025, net realized and unrealized gains were **$3.8 million**, down from **$6.5 million** in the same period of 2024, largely due to higher net unrealized gains on equity securities in the prior year[36](index=36&type=chunk) - Realized losses in Q2 and the first six months of 2025 included a **$1.2 million** loss related to an acquisition contingent liability adjustment[36](index=36&type=chunk) [NOTE 6 Goodwill](index=13&type=section&id=NOTE%206%20Goodwill.) This note outlines changes in consolidated goodwill, primarily due to acquisitions within the title segment Goodwill by Segment | Segment | Balances at December 31, 2024 ($ thousands) | Acquisitions ($ thousands) | Balances at June 30, 2025 ($ thousands) | | :-------------------- | :---------------------------- | :----------- | :------------------------ | | Title | 719,945 | 8,608 | 728,553 | | Real Estate Solutions | 364,194 | — | 364,194 | | **Consolidated Total** | **1,084,139** | **8,608** | **1,092,747** | - Consolidated goodwill increased by **$8.6 million** to **$1,092.7 million** at June 30, 2025, primarily due to acquisitions of title offices within the title segment during the first six months of 2025[38](index=38&type=chunk) [NOTE 7 Estimated Title Losses](index=14&type=section&id=NOTE%207%20Estimated%20title%20losses.) This note details estimated title losses, including provisions, payments, and foreign currency impact Estimated Title Losses Activity | Metric | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :------------------- | :----------------------------- | :----------------------------- | | Balances at January 1 | 511,534 | 528,269 | | Total provisions | 39,156 | 38,472 | | Total payments, net of recoveries | (35,523) | (50,022) | | Effects of changes in foreign currency exchange rates | 7,918 | (4,273) | | **Balances at June 30** | **523,085** | **512,446** | | Loss ratios as a percentage of title operating revenues: | | | | Current year provisions | 3.5 % | 4.0 % | | Total provisions | 3.6 % | 4.1 % | - Estimated title losses increased to **$523.1 million** at June 30, 2025, from **$511.5 million** at January 1, 2025[39](index=39&type=chunk) - The total title loss ratio improved to **3.6%** for the first six months of 2025, down from **4.1%** in the same period of 2024, primarily due to favorable claims experience[39](index=39&type=chunk)[59](index=59&type=chunk) - Total payments, net of recoveries, decreased by **29%** to **$35.5 million** for the first six months of 2025, compared to **$50.0 million** in the prior year, driven by large recoveries and lower payments on claims[39](index=39&type=chunk)[91](index=91&type=chunk) [NOTE 8 Share-based Payments](index=14&type=section&id=NOTE%208%20Share-based%20payments.) This note describes share-based compensation activities, including restricted stock unit grants and their fair value - During the first six months of 2025, the Company granted time-based and performance-based restricted stock units with an aggregate grant-date fair value of **$15.3 million** (**215,000 units** at an average price of **$71.36 per unit**)[41](index=41&type=chunk) - This represents an increase in fair value from **$13.8 million** (**225,000 units** at **$61.44 per unit**) granted in the same period of 2024[41](index=41&type=chunk) [NOTE 9 Earnings Per Share](index=15&type=section&id=NOTE%209%20Earnings%20per%20share.) This note presents basic and diluted earnings per share calculations, reflecting net income and average shares Earnings Per Share Calculation | EPS Metric | Three Months Ended June 30, 2025 ($'000) | Three Months Ended June 30, 2024 ($'000) | Six Months Ended June 30, 2025 ($'000) | Six Months Ended June 30, 2024 ($'000) | | :--------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income attributable to Stewart ($'000) | 31,922 | 17,343 | 34,999 | 20,473 | | Basic average shares outstanding ('000) | 27,931 | 27,592 | 27,880 | 27,549 | | Diluted average shares outstanding ('000) | 28,330 | 28,013 | 28,337 | 28,011 | | Basic earnings per share attributable to Stewart ($) | 1.14 | 0.63 | 1.26 | 0.74 | | Diluted earnings per share attributable to Stewart ($) | 1.13 | 0.62 | 1.24 | 0.73 | - Diluted EPS increased by **82%** to **$1.13** for Q2 2025 and by **70%** to **$1.24** for the first six months of 2025, compared to the respective prior year periods, reflecting higher net income attributable to Stewart[44](index=44&type=chunk) [NOTE 10 Contingent Liabilities and Commitments](index=15&type=section&id=NOTE%2010%20Contingent%20liabilities%20and%20commitments.) This note discusses guarantees for third-party indebtedness, lease obligations, and unused letters of credit - The Company guarantees third-party indebtedness and lease obligations of its consolidated subsidiaries, with maximum potential future payments not exceeding recorded notes payable and future lease obligations[45](index=45&type=chunk) - As of June 30, 2025, the Company had unused letters of credit totaling **$4.9 million** related to workers' compensation and other insurance, with no expected payments on these guarantees[45](index=45&type=chunk) [NOTE 11 Regulatory and Legal Developments](index=15&type=section&id=NOTE%2011%20Regulatory%20and%20legal%20developments.) This note addresses ordinary course claims, lawsuits, and governmental inquiries, assessing their potential financial impact - The Company is subject to ordinary course claims and lawsuits, primarily disputed policy claims, and does not expect them to have a material adverse effect on its financial condition or results of operations[46](index=46&type=chunk) - For non-ordinary course lawsuits and governmental inquiries, the Company believes any potential loss is not reasonably possible or will not be material, and has adequately reserved for these matters[47](index=47&type=chunk)[48](index=48&type=chunk)[49](index=49&type=chunk) [NOTE 12 Segment Information](index=16&type=section&id=NOTE%2012%20Segment%20information.) This note provides a detailed breakdown of revenues and pretax income by operating segment and geographic region Segment Revenues and Pretax Income | Segment | Three Months Ended June 30, 2025 Revenues ($ thousands) | Three Months Ended June 30, 2024 Revenues ($ thousands) | Six Months Ended June 30, 2025 Revenues ($ thousands) | Six Months Ended June 30, 2024 Revenues ($ thousands) | | :-------------------- | :---------------------------------------- | :---------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Title | 609,548 | 510,035 | 1,124,423 | 981,387 | | Real estate solutions | 112,674 | 92,222 | 209,785 | 175,263 | | Corporate | (41) | (27) | (43) | (105) | | **Consolidated Stewart** | **722,181** | **602,230** | **1,334,165** | **1,156,545** | | | Three Months Ended June 30, 2025 Pretax Income ($ thousands) | Three Months Ended June 30, 2024 Pretax Income ($ thousands) | Six Months Ended June 30, 2025 Pretax Income ($ thousands) | Six Months Ended June 30, 2024 Pretax Income ($ thousands) | | Title | 49,314 | 33,371 | 61,080 | 43,554 | | Real estate solutions | 6,741 | 5,116 | 10,800 | 11,847 | | Corporate | (9,279) | (9,482) | (19,204) | (19,250) | | **Consolidated Stewart** | **46,776** | **29,005** | **52,676** | **36,151** | - The Title segment's revenues increased by **19.5%** to **$609.5 million** for Q2 2025 and by **14.6%** to **$1,124.4 million** for the first six months of 2025, with pretax income rising by **47.8%** and **40.2%** respectively[51](index=51&type=chunk) - Real Estate Solutions revenues grew by **22.2%** to **$112.7 million** for Q2 2025 and by **19.7%** to **$209.8 million** for the first six months of 2025, while its pretax income increased by **31.8%** in Q2 2025 but decreased by **8.8%** for the first six months of 2025[52](index=52&type=chunk) Revenues by Geographic Region | Geographic Region | Three Months Ended June 30, 2025 ($ thousands) | Three Months Ended June 30, 2024 ($ thousands) | Six Months Ended June 30, 2025 ($ thousands) | Six Months Ended June 30, 2024 ($ thousands) | | :------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | United States | 682,144 | 563,839 | 1,263,719 | 1,088,861 | | International | 40,037 | 38,391 | 70,446 | 67,684 | | **Total Revenues** | **722,181** | **602,230** | **1,334,165** | **1,156,545** | [NOTE 13 Other Comprehensive Income (Loss)](index=18&type=section&id=NOTE%2013%20Other%20comprehensive%20income%20(loss).)` This note explains other comprehensive income components, including unrealized investment gains/losses and foreign currency adjustments Other Comprehensive Income (Loss) Components | Component | Six Months Ended June 30, 2025 Net-of-Tax Amount ($ thousands) | Six Months Ended June 30, 2024 Net-of-Tax Amount ($ thousands) | | :--------------------------------------- | :----------------------------------------------- | :----------------------------------------------- | | Change in net unrealized gains and losses on investments | 6,090 | (2,162) | | Reclassification adjustment for realized gains and losses on investments | 327 | 540 | | Foreign currency translation adjustments | 14,408 | (5,726) | | **Total Other comprehensive income (loss)** | **20,825** | **(7,348)** | - Other comprehensive income (loss) significantly improved to a gain of **$20.8 million** for the first six months of 2025, compared to a loss of **$7.3 million** in the same period of 2024[54](index=54&type=chunk) - This improvement was driven by positive foreign currency translation adjustments (**$14.4 million** gain vs. **$5.7 million** loss YoY) and a shift to net unrealized gains on investments (**$6.1 million** gain vs. **$2.2 million** loss YoY), primarily due to lower interest rates and appreciation of the Canadian dollar and British pound against the U.S. dollar[54](index=54&type=chunk)[112](index=112&type=chunk)[113](index=113&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance, condition, and operational results, covering key highlights and liquidity [Management's Overview](index=19&type=section&id=MANAGEMENT'S%20OVERVIEW) This overview highlights key financial results, including net income, pretax income, and segment performance - Net income attributable to Stewart for Q2 2025 was **$31.9 million** (**$1.13** diluted EPS), a significant increase from **$17.3 million** (**$0.62** diluted EPS) in Q2 2024[56](index=56&type=chunk) - Pretax income before noncontrolling interests for Q2 2025 rose to **$46.8 million** from **$29.0 million** in the prior year quarter[56](index=56&type=chunk) Title Segment Performance Highlights | Title Segment Metric | Q2 2025 ($ millions) | Q2 2024 ($ millions) | % Change | | :------------------- | :------------------- | :------------------- | :------- | | Operating revenues | 592.5 | 496.2 | 19 % | | Investment income | 16.2 | 14.3 | 14 % | | Net realized and unrealized gains (losses) | 0.8 | (0.5) | 258 % | | Pretax income | 49.3 | 33.4 | 48 % | | Pretax margin | 8.1 % | 6.5 % | | - Title segment operating revenues increased by **19%** in Q2 2025, driven by improved direct and agency title operations, while pretax income grew by **48%** to **$49.3 million**[57](index=57&type=chunk) - Real estate solutions segment operating revenues increased by **22%** to **$112.7 million** in Q2 2025, with pretax income growing by **32%** to **$6.7 million**[60](index=60&type=chunk)[61](index=61&type=chunk) [Critical Accounting Estimates](index=20&type=section&id=CRITICAL%20ACCOUNTING%20ESTIMATES) This section confirms no material changes to critical accounting estimates during the reporting period - No material changes were made to critical accounting estimates during the six months ended June 30, 2025, as previously disclosed in the 2024 Form 10-K[63](index=63&type=chunk) [Operations](index=20&type=section&id=Operations.) This section describes the company's core business activities, including title insurance and real estate solutions - The Company's primary business is title insurance and settlement-related services across all 50 U.S. states and international markets[64](index=64&type=chunk) - Real estate solutions operations include credit and real estate information, valuation, online notarization, closing, and capital markets search services[64](index=64&type=chunk) [Factors Affecting Revenues](index=20&type=section&id=Factors%20affecting%20revenues.) This section identifies key external and internal factors influencing operating revenues, such as interest rates and market activity - Key factors influencing operating revenues include interest rates, mortgage loan availability and value, home prices, consumer confidence, premium rates, foreign currency exchange rates, market share, and the volume of commercial transactions[65](index=65&type=chunk) - Historically, Q1 is the least active for title insurance revenues, while Q2 and Q3 are typically the most active due to the traditional home buying season[66](index=66&type=chunk) [Results of Operations](index=21&type=section&id=RESULTS%20OF%20OPERATIONS) This section analyzes the operating environment, revenues by segment, and various expense categories [Operating Environment](index=21&type=section&id=Operating%20environment.) This section describes broader market conditions, including home sales, median home prices, and mortgage origination trends - Existing home sales in June 2025 were **3.9 million units**, similar to a year ago but **3%** lower than May 2025, due to elevated mortgage rates and rising home prices[69](index=69&type=chunk) - The median home price in June 2025 was **$435,000**, marking the **24th consecutive month** of year-over-year increases, up **2%** from June 2024[69](index=69&type=chunk) - Total U.S. single-family mortgage originations increased **24%** to **$532 billion** in Q2 2025, primarily driven by higher refinancing activity, with the 30-year fixed mortgage rate averaging **6.8%** (down from **7.0%** in Q2 2024)[70](index=70&type=chunk) [Title Revenues](index=21&type=section&id=Title%20revenues.) This section analyzes direct title revenues, including commercial and international segments, and order volumes Direct Title Revenue Breakdown | Direct Title Revenue | Q2 2025 ($ millions) | Q2 2024 ($ millions) | Change ($ millions) | % Chg | YTD 2025 ($ millions) | YTD 2024 ($ millions) | Change ($ millions) | % Chg | | :-------------------------------- | :------ | :------ | :----- | :---- | :------- | :------- | :----- | :---- | | Non-commercial Domestic | 179.6 | 169.4 | 10.2 | 6 % | 314.2 | 304.6 | 9.6 | 3 % | | Commercial Domestic | 74.6 | 51.0 | 23.6 | 46 % | 144.0 | 100.8 | 43.2 | 43 % | | Total International | 7.4 | 7.0 | 0.4 | 6 % | 13.1 | 13.4 | (0.3) | (2)% | | **Total Direct Title Revenues** | **291.3** | **255.5** | **35.8** | **14 %** | **522.9** | **466.1** | **56.8** | **12 %** | - Domestic commercial revenues significantly improved by **46%** in Q2 2025 and **43%** in the first six months of 2025, driven by increased average transaction size and closed transactions in sectors like energy, mixed-use, retail, and data centers[73](index=73&type=chunk) Title Orders Opened and Closed | Orders | Q2 2025 Opened (Units) | Q2 2024 Opened (Units) | % Chg Opened | Q2 2025 Closed (Units) | Q2 2024 Closed (Units) | % Chg Closed | | :--------------- | :------------- | :------------- | :----------- | :------------- | :------------- | :----------- | | Commercial | 4,526 | 3,526 | 28 % | 4,415 | 3,787 | 17 % | | Purchase | 52,793 | 55,057 | (4)% | 35,886 | 37,832 | (5)% | | Refinance | 19,736 | 16,731 | 18 % | 12,165 | 9,978 | 22 % | | Other | 12,591 | 11,407 | 10 % | 14,128 | 7,902 | 79 % | | **Total** | **89,646** | **86,721** | **3 %** | **66,594** | **59,499** | **12 %** | - Gross revenues from independent agency operations increased by **25%** in Q2 2025 and **18%** in the first six months of 2025, primarily due to improved volumes in key agency states[77](index=77&type=chunk) [Real Estate Solutions Revenues](index=22&type=section&id=Real%20estate%20solutions%20revenues.) This section examines growth in real estate solutions revenues, driven by credit information and valuation services - Real estate solutions revenues improved by **22%** in Q2 2025 and **20%** in the first six months of 2025, driven by higher revenues from credit information and valuation services[78](index=78&type=chunk) [Investment Income](index=22&type=section&id=Investment%20income.) This section analyzes the increase in investment income, primarily from higher interest and dividend earnings - Investment income increased by **14%** in Q2 2025 and **6%** in the first six months of 2025, primarily due to higher interest and dividend income from bond and cost-basis investments[79](index=79&type=chunk) [Net Realized and Unrealized Gains (Losses)](index=22&type=section&id=Net%20realized%20and%20unrealized%20gains%20(losses).)` This section directs to Note 5 for detailed information on net realized and unrealized gains and losses - Refer to Note 5 for detailed information on net realized and unrealized gains and losses[80](index=80&type=chunk) [Expenses](index=23&type=section&id=Expenses.) This section analyzes various expense categories, including agency retention, employee costs, and other operating expenses [Retention by Agencies](index=23&type=section&id=Retention%20by%20agencies.) This section discusses the percentage of revenues retained by independent agencies and influencing factors - Amounts retained by independent agencies, as a percentage of revenues, averaged **83.7%** in Q2 2025 and **83.2%** in the first six months of 2025, slightly up from **83.2%** and **83.1%** in the prior year periods, due to increased revenues from states with higher retention rates[82](index=82&type=chunk) [Employee Costs](index=23&type=section&id=Employee%20costs.) This section analyzes changes in consolidated employee costs, including incentive compensation, salaries, and benefits - Consolidated employee costs increased by **16%** in Q2 2025 and **12%** in the first six months of 2025, primarily due to higher incentive compensation and increased salaries/benefits from higher employee counts[83](index=83&type=chunk) - As a percentage of total operating revenues, employee costs improved to **29.5%** in Q2 2025 and **30.3%** in the first six months of 2025, down from **30.5%** and **31.4%** respectively in the prior year, driven by higher operating revenues[84](index=84&type=chunk) - Average cost per employee increased by **10%** in Q2 2025 and **8%** in the first six months of 2025, mainly due to increased incentive compensation[84](index=84&type=chunk) [Other Operating Expenses](index=23&type=section&id=Other%20operating%20expenses.) This section details the increase in other operating expenses, driven by variable costs and search fees - Consolidated other operating expenses increased by **14%** in Q2 2025 and **16%** in the first six months of 2025, primarily due to a **22%** and **23%** increase in total variable costs, respectively, driven by higher third-party service and appraiser expenses and title outside search fees[86](index=86&type=chunk) - As a percentage of total operating revenues, other operating expenses improved to **24.6%** in Q2 2025 and **25.7%** in the first six months of 2025, compared to **25.9%** and **25.8%** in the prior year periods, due to higher operating revenues[87](index=87&type=chunk) [Title Losses](index=25&type=section&id=Title%20losses.) This section analyzes provisions for title losses, including loss ratio, known claims, and cash claim payments - Provisions for title losses, as a percentage of title operating revenues, improved to **3.6%** for both Q2 and the first six months of 2025, down from **4.2%** and **4.1%** respectively in the prior year periods, reflecting favorable claims experience[88](index=88&type=chunk) - Total known claims provision decreased by **41%** in Q2 2025 and **28%** in the first six months of 2025, primarily due to lower large claims from prior policy years[90](index=90&type=chunk) - Cash claim payments decreased by **39%** in Q2 2025 and **29%** in the first six months of 2025, driven by large recoveries and lower payments on large and non-large claims[91](index=91&type=chunk) Title Policy Loss Reserve | Title Policy Loss Reserve | June 30, 2025 ($ millions) | December 31, 2024 ($ millions) | | :------------------------------------- | :------------ | :---------------- | | Known claims | 65.8 | 66.9 | | IBNR (Incurred But Not Reported) | 457.3 | 444.6 | | **Total Estimated Title Losses** | **523.1** | **511.5** | [Depreciation and Amortization](index=26&type=section&id=Depreciation%20and%20amortization.) This section notes comparable depreciation and amortization expenses, with offsetting changes from amortized assets and new systems - Total depreciation and amortization expenses were comparable in Q2 and the first six months of 2025 compared to the prior year periods[94](index=94&type=chunk) - A decline in acquisition intangible amortization due to fully amortized assets was offset by increased depreciation from new internal systems[94](index=94&type=chunk) [Income Taxes](index=26&type=section&id=Income%20taxes.) This section discusses effective tax rates for the reporting periods, noting a decrease due to higher pretax income - The effective tax rates were **26%** for Q2 2025 and **25%** for the first six months of 2025, lower than **31%** and **30%** respectively in the prior year periods, primarily due to higher pretax income[95](index=95&type=chunk) [Liquidity and Capital Resources](index=27&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) This section overviews cash, investments, statutory reserves, capital structure, and cash flow analysis [Overview](index=27&type=section&id=Overview.) This overview summarizes total cash and investments, statutory reserve restrictions, and intercompany dividends - As of June 30, 2025, total cash and investments aggregated **$913.6 million**, with **$486.3 million** held in the U.S. and the remainder internationally[97](index=97&type=chunk) - Statutory reserve funds, totaling approximately **$516.3 million** in investments and **$7.4 million** in cash, are restricted and not available for current claim payments[100](index=100&type=chunk) - Stewart Title Guaranty Company (Guaranty) paid dividends of **$50.0 million** to the parent company during the first six months of 2025, compared to **$20.0 million** in the same period of 2024[101](index=101&type=chunk) [Operating Activities](index=28&type=section&id=Operating%20activities.) This section analyzes cash flow from operating activities, highlighting improvements from net income and claims payments - Net cash provided by operations improved to **$23.5 million** during the first six months of 2025, from net cash used of **$8.5 million** in the prior year, driven by higher net income and lower claims payments[105](index=105&type=chunk) - The Company is focused on cost management, automation, system consolidation, and integration of acquisitions to improve operating margins[105](index=105&type=chunk) [Investing Activities](index=28&type=section&id=Investing%20activities.) This section details cash flows from investing activities, including securities, property, and acquisitions - Cash used by investing activities decreased to **$29.5 million** for the first six months of 2025, from **$56.3 million** in the prior year[104](index=104&type=chunk)[106](index=106&type=chunk) - Proceeds from sales and maturities of securities investments totaled **$84.8 million**, while purchases were **$72.2 million** during the first six months of 2025[106](index=106&type=chunk) - Cash used for property and equipment expenditures was **$27.1 million**, and **$8.5 million** was used for acquisitions of title offices and an intangible asset during the first six months of 2025[107](index=107&type=chunk) [Financing Activities and Capital Resources](index=28&type=section&id=Financing%20activities%20and%20capital%20resources.) This section reviews the company's debt, equity, debt-to-equity ratios, and common stock dividends paid - Total debt was **$446.0 million** and stockholders' equity was **$1.45 billion** as of June 30, 2025[108](index=108&type=chunk) - The debt-to-equity ratio was approximately **31%**, and the debt-to-capitalization ratio was approximately **24%** (excluding Section 1031 notes)[108](index=108&type=chunk) - Total dividends paid were **$27.9 million** (**$1.00 per common share**) during the first six months of 2025, an increase from **$26.2 million** (**$0.95 per common share**) in the prior year[109](index=109&type=chunk) [Contingent Liabilities and Commitments](index=29&type=section&id=Contingent%20liabilities%20and%20commitments.) This section refers to Note 10 for detailed information on contingent liabilities and commitments - Refer to Note 10 for details on contingent liabilities and commitments[111](index=111&type=chunk) [Other Comprehensive Income (Loss)](index=29&type=section&id=Other%20comprehensive%20income%20(loss).)` This section discusses the impact of unrealized investment gains and foreign currency adjustments on comprehensive income - Net unrealized investment gains of **$6.4 million** (net of taxes) increased other comprehensive income in the first six months of 2025, primarily due to lower interest rates[112](index=112&type=chunk) - Foreign currency translation adjustments resulted in **$14.4 million** of other comprehensive income (net of taxes) in the first six months of 2025, as the Canadian dollar and British pound appreciated against the U.S. dollar[113](index=113&type=chunk) [Off-Balance Sheet Arrangements](index=29&type=section&id=Off-balance%20sheet%20arrangements.) This section confirms no material off-balance sheet arrangements and clarifies segregated fund treatment - The Company does not have any material off-balance sheet arrangements for liquidity or financing[114](index=114&type=chunk) - Funds held in segregated escrow accounts and by qualified intermediaries for tax-deferred property exchanges are not included on the balance sheet, in accordance with industry practice[114](index=114&type=chunk) [Forward-Looking Statements](index=29&type=section&id=Forward-looking%20statements.) This section cautions that forward-looking statements are subject to risks and uncertainties, with no obligation to update - Forward-looking statements in the report are subject to various risks and uncertainties, including economic conditions, real estate activity, mortgage interest rates, technology changes, title losses, and regulatory changes[115](index=115&type=chunk)[120](index=120&type=chunk) - The Company disclaims any obligation to update forward-looking statements unless required by applicable law[116](index=116&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=30&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section confirms no material changes to investment strategies, financial instruments, or market risks during the quarter - No material changes occurred in investment strategies, types of financial instruments held, or associated market risks during Q2 2025[117](index=117&type=chunk) [Item 4. Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the evaluation of disclosure controls and reports on changes in internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=30&type=section&id=Evaluation%20of%20disclosure%20controls%20and%20procedures.) This section confirms the adequacy and effectiveness of disclosure controls and procedures as of June 30, 2025 - The principal executive and financial officers concluded that the Company's disclosure controls and procedures were adequate and effective as of June 30, 2025[118](index=118&type=chunk) [Changes in Internal Control Over Financial Reporting](index=30&type=section&id=Changes%20in%20internal%20control%20over%20financial%20reporting.) This section reports no material changes in internal control over financial reporting during the quarter - There were no material changes in internal control over financial reporting during the quarter ended June 30, 2025[119](index=119&type=chunk) PART II – OTHER INFORMATION [Item 1. Legal Proceedings](index=31&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 11 for legal proceedings information, indicating no new material updates - Legal proceedings information is incorporated by reference from Note 11 to the condensed consolidated financial statements[122](index=122&type=chunk) [Item 1A. Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) This section states no material changes to risk factors have occurred since the 2024 Form 10-K filing - No material changes to risk factors have occurred since the 2024 Form 10-K[123](index=123&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section reports common stock repurchases for statutory income tax withholding on restricted unit grants - Approximately **49,900 shares** of Common Stock were repurchased for **$3.5 million** during the first six months of 2025, solely for statutory income tax withholding on restricted unit grants[124](index=124&type=chunk) [Item 5. Other Information](index=31&type=section&id=Item%205.%20Other%20Information) This section provides book value per share details and confirms no new trading plans by directors or Section 16 officers [Book Value Per Share](index=31&type=section&id=Book%20value%20per%20share.) This section presents the company's book value per share and related equity figures Book Value Per Share Details | Metric | June 30, 2025 ($) | December 31, 2024 ($) | | :--------------------------------- | :------------ | :---------------- | | Book value per share | $51.46 | $50.50 | | Stockholders' equity attributable to Stewart | $1.44 billion | $1.40 billion | | Common Stock outstanding (count) | 27,939,997 | 27,763,691 | - Book value per share increased to **$51.46** as of June 30, 2025, from **$50.50** at December 31, 2024[125](index=125&type=chunk) [Trading Plans](index=31&type=section&id=Trading%20plans.) This section confirms no new Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted or terminated - No director or Section 16 officer adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2025[126](index=126&type=chunk) [Item 6. Exhibits](index=32&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including corporate governance documents and certifications - Exhibits include the Restated Certificate of Incorporation, Amended and Restated By-Laws, CEO and CFO certifications (Sarbanes-Oxley Act Sections 302 and 906), and various XBRL taxonomy documents[127](index=127&type=chunk) [Signature](index=32&type=section&id=Signature) This section contains the official signature of Stewart Information Services Corporation by its Chief Financial Officer and Treasurer - The report was signed on August 5, 2025, by David C. Hisey, Chief Financial Officer and Treasurer of Stewart Information Services Corporation[129](index=129&type=chunk)

Financial Data and Key Metrics Changes - The company reported a net income of $32 million or $1.13 per diluted share based on revenues of $722 million for Q2 2025, with adjusted net income of $38 million or $1.34 per diluted share compared to $25 million or $0.91 per diluted share last year [19][20] - Revenue grew by 20% and adjusted EPS increased by 48% compared to Q2 2024 [8][19] - The title segment's operating revenues improved by $96 million or 19%, resulting in a pretax income improvement of $16 million or 48% [20] Business Line Data and Key Metrics Changes - Direct operations grew by 6% overall, with a focus on growing market share in target MSAs and micro markets [8] - Small commercial operations delivered a 36% growth rate compared to the previous year [9] - Domestic commercial revenues increased by $24 million or 46%, driven by strength in various asset classes [11][20] - Agency service business grew by 25% compared to Q2 2024, indicating continued share gains [12] Market Data and Key Metrics Changes - Existing home sales were down roughly 1% compared to Q2 2024, with price appreciation cooling to around 1.5% for the quarter [7][8] - The title loss ratio improved to 3.6% compared to 4.2% last year, with expectations to average around 4% for the full year 2025 [21] Company Strategy and Development Direction - The company is focused on strategic growth initiatives, including acquisitions to drive growth in direct operations [8][10] - There is a strong emphasis on expanding small commercial operations and enhancing agency capabilities [9][12] - The company aims to deepen customer relationships and expand its geographic presence, particularly in Canada [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of the year, expecting some improvement relative to 2024 despite market uncertainties [7][8] - The company remains dedicated to strengthening its competitive position and is poised to capitalize on market improvements when they occur [16] Other Important Information - The company announced the acquisition of Batch Leads and Batch Dialer, enhancing its real estate data and analytics capabilities [14] - Total cash and investments were approximately $390 million, with a fully available $200 million line of credit [23] Q&A Session Summary Question: Discussion on commercial pipeline in July and expectations for the back half of the year - Management feels confident about the commercial pipeline, expecting growth but not at the same rate as previous quarters [27][28] Question: Agent premiums and timing issues - The increase in agency premiums is attributed to improved servicing and capabilities, with a focus on geographic growth [31][32] Question: Agent retention rate decline - The decline is primarily driven by geographic factors, particularly in Florida, where market share remains low compared to competitors [34] Question: Breakdown of domestic commercial business - Approximately $19 million of the total domestic commercial revenue is classified as small commercial, indicating a focus on this segment [40] Question: Premium relationship between purchase and refi deals - Retail deals average around $3,000, while refi deals range from $1,000 to $1,400, with margins varying based on capacity [42][43] Question: Investment income increase - The increase in investment income is attributed to higher yield environments and increased balances [56][58]

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) Stewart Company achieved strong financial results in Q2 2025, driven by significant growth in net income and EPS across business lines despite real estate market challenges [Second Quarter 2025 Performance Overview](index=1&type=section&id=Second%20Quarter%202025%20Performance%20Overview) Stewart Company achieved strong financial performance in Q2 2025 with significant growth in GAAP and adjusted net income and diluted EPS, driven by progress across business lines despite real estate market headwinds | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :---------------------------------------- | :------------------ | :------------------ | :----- | | Net Income Attributable to Stewart | 31.9 | 17.3 | +84% | | Diluted EPS Attributable to Stewart ($) | 1.13 | 0.62 | +82% | | Adjusted Net Income Attributable to Stewart | 38.0 | 25.4 | +50% | | Adjusted Diluted EPS Attributable to Stewart ($) | 1.34 | 0.91 | +47% | | Pretax Income | 46.8 | 29.0 | +61% | | Adjusted Pretax Income | 54.9 | 39.6 | +39% | - CEO Fred Eppinger expressed satisfaction with the quarter's results, noting revenue growth across business lines indicating company progress and sound operational management leading to robust profitability[4](index=4&type=chunk) [Key Financial Highlights (Consolidated)](index=1&type=section&id=Key%20Financial%20Highlights%20(Consolidated)) In Q2 2025, Stewart Company achieved significant year-over-year growth in total revenue, net income, and diluted EPS (GAAP and adjusted) | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | | :---------------------------------------- | :------------------ | :------------------ | | Total Revenue | 722.2 | 602.2 | | Adjusted Total Revenue | 721.5 | 602.7 | | Net Income | 31.9 | 17.3 | | Adjusted Net Income | 38.0 | 25.4 | | Diluted EPS ($) | 1.13 | 0.62 | | Adjusted Diluted EPS ($) | 1.34 | 0.91 | [Consolidated Financial Performance](index=2&type=section&id=Consolidated%20Financial%20Performance) This section provides an overview of Stewart Company's consolidated financial results, including operating performance, expense analysis, and cash flow from operations [Summary Results of Operations (GAAP & Adjusted)](index=2&type=section&id=Summary%20Results%20of%20Operations%20(GAAP%20%26%20Adjusted)) Stewart Company achieved significant year-over-year growth in total revenue, pretax income, and net income for Q2 and H1 2025, alongside improved pretax margins Consolidated Summary Results of Operations | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | H1 2025 ($ million) | H1 2024 ($ million) | | :---------------------------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Total Revenue | 722.2 | 602.2 | 1,334.2 | 1,156.5 | | Pretax Income (before noncontrolling interests) | 46.8 | 29.0 | 52.7 | 36.2 | | Net Income Attributable to Stewart | 31.9 | 17.3 | 35.0 | 20.5 | | Adjusted Net Income Attributable to Stewart | 38.0 | 25.4 | 44.9 | 30.0 | | Pretax Margin | 6.5% | 4.8% | 3.9% | 3.1% | | Adjusted Pretax Margin | 7.6% | 6.6% | 5.0% | 4.2% | | Diluted EPS ($) | 1.13 | 0.62 | 1.24 | 0.73 | | Adjusted Diluted EPS ($) | 1.34 | 0.91 | 1.59 | 1.07 | [Consolidated Expenses Analysis](index=4&type=section&id=Consolidated%20Expenses%20Analysis) In Q2 2025, consolidated employee costs and other operating expenses increased due to revenue growth, higher incentive compensation, and increased headcount, yet improved as a percentage of total operating revenue - Consolidated employee costs increased by **16% ($28.5 million)** year-over-year in Q2 2025, primarily due to higher incentive compensation and a **5% increase** in average headcount[15](index=15&type=chunk) - Consolidated employee costs as a percentage of total operating revenue improved to **29.5%** in Q2 2025 from **30.5%** in the prior year quarter[15](index=15&type=chunk) - Consolidated other operating expenses increased by **14% ($21.2 million)** year-over-year in Q2 2025, driven by higher real estate solutions service fees and increased title external search and premium taxes[16](index=16&type=chunk) - Consolidated other operating expenses as a percentage of total operating revenue improved to **24.6%** in Q2 2025 from **25.9%** in the prior year quarter[16](index=16&type=chunk) [Cash Flow from Operations](index=5&type=section&id=Cash%20Flow%20from%20Operations) Net cash provided by operating activities significantly increased in Q2 2025, primarily driven by higher net income and reduced claims payments | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :---------------------------------------- | :------------------ | :------------------ | :----- | | Net Cash Provided by Operating Activities | 53.4 | 21.1 | +153% | - Cash flow improvement was primarily driven by **higher net income** and **lower claims payments**[18](index=18&type=chunk) [Segment Performance Analysis](index=2&type=section&id=Segment%20Performance%20Analysis) This section analyzes the financial performance of Stewart Company's Title, Real Estate Solutions, and Corporate segments, highlighting key revenue and expense drivers [Title Segment](index=2&type=section&id=Title%20Segment) The Title segment demonstrated strong financial performance, with increased operating revenue and improved pretax income, driven by growth in direct and agency title operations [Title Segment Financial Results](index=2&type=section&id=Title%20Segment%20Financial%20Results) The Title segment achieved strong growth in Q2 2025, with a 19% increase in operating revenue and a 48% rise in pretax income, primarily due to improvements in direct and agency title operations and higher investment income Title Segment Performance Summary | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :---------------------------------------- | :------------------ | :------------------ | :----- | | Operating Revenue | 592.5 | 496.2 | +19% | | Investment Income | 16.2 | 14.3 | +14% | | Net Realized and Unrealized Gains (Losses) | 0.8 | (0.5) | +258% | | Pretax Income | 49.3 | 33.4 | +48% | | Adjusted Pretax Income | 51.9 | 38.4 | +35% | | Pretax Margin | 8.1% | 6.5% | +1.6pp | | Adjusted Pretax Margin | 8.5% | 7.5% | +1.0pp | [Title Segment Operating Revenues & Expenses](index=2&type=section&id=Title%20Segment%20Operating%20Revenues%20%26%20Expenses) Title segment operating revenue increased due to growth in direct and agency operations, with investment income also rising from higher interest and dividends, while expenses grew with revenue but employee costs, other operating expenses, and title loss expense as a percentage of revenue all improved - Title segment operating revenue increased by **$96.3 million (19%)**, and investment income grew by **$2.0 million (14%)**, primarily driven by higher interest and dividend income[8](index=8&type=chunk) - Total segment operating expenses increased by **$83.6 million (18%)**, with agency retention expenses rising **26%**, consistent with a **25% increase** in agency gross revenue[9](index=9&type=chunk) - Combined employee costs and other operating expenses increased by **$31.3 million (13%)**, primarily due to higher incentive compensation, increased external search and service fees, and higher headcount[9](index=9&type=chunk) - Title loss expense as a percentage of title operating revenue improved to **3.6%** in Q2 2025 from **4.2%** in the prior year quarter, primarily benefiting from continued favorable claims experience[10](index=10&type=chunk) [Direct Title Revenues Breakdown](index=3&type=section&id=Direct%20Title%20Revenues%20Breakdown) In Q2 2025, total direct title revenue grew by 14%, primarily driven by a 46% surge in domestic commercial revenue due to larger average transaction sizes and increased commercial volumes, while domestic non-commercial revenue rose 6% from higher residential refinancing and real estate investor transactions Direct Title Revenues Breakdown | Category | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :------------------------- | :------------------ | :------------------ | :----- | | **Non-Commercial:** | | | | | Domestic | 179.6 | 169.4 | +6% | | International | 29.7 | 28.1 | +6% | | **Commercial:** | | | | | Domestic | 74.6 | 51.0 | +46% | | International | 7.4 | 7.0 | +6% | | **Total Direct Title Revenues** | **291.3** | **255.5** | **+14%** | - Domestic commercial revenue increased by **$23.6 million (46%)**, driven by a **25% improvement** in average transaction size (**$16,900 vs $13,500**) and a **17% increase** in commercial transaction volumes[11](index=11&type=chunk) - Domestic non-commercial revenue increased by **$10.2 million (6%)**, primarily from higher residential refinancing and real estate investor transactions[11](index=11&type=chunk) [Real Estate Solutions Segment](index=4&type=section&id=Real%20Estate%20Solutions%20Segment) The Real Estate Solutions segment demonstrated strong growth in operating revenue and pretax income, primarily driven by robust performance in credit information and valuation services [Real Estate Solutions Segment Financial Results](index=4&type=section&id=Real%20Estate%20Solutions%20Segment%20Financial%20Results) The Real Estate Solutions segment achieved a 22% increase in operating revenue and a 32% rise in pretax income in Q2 2025, primarily driven by strong performance in credit information and valuation services Real Estate Solutions Segment Performance Summary | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :---------------------------------------- | :------------------ | :------------------ | :----- | | Operating Revenue | 112.7 | 92.2 | +22% | | Pretax Income | 6.7 | 5.1 | +32% | | Adjusted Pretax Income | 12.2 | 10.6 | +15% | | Pretax Margin | 6.0% | 5.5% | +0.5pp | | Adjusted Pretax Margin | 10.9% | 11.5% | -0.6pp | [Real Estate Solutions Operating Revenues & Expenses](index=4&type=section&id=Real%20Estate%20Solutions%20Operating%20Revenues%20%26%20Expenses) Real Estate Solutions segment operating revenue increased due to growth in credit information and valuation services, with corresponding rises in employee costs and other operating expenses to support this expansion - Segment operating revenue increased by **$20.5 million (22%)**, primarily driven by higher revenues from credit information and valuation services[13](index=13&type=chunk) - Combined employee costs and other operating expenses increased by **$18.7 million (23%)**, primarily due to higher service costs related to credit information and valuation services and increased employee costs to support revenue growth[13](index=13&type=chunk) [Corporate Segment](index=4&type=section&id=Corporate%20Segment) The Corporate segment's net expenses experienced a slight decrease in Q2 2025 | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | Change | | :---------------------------------------- | :------------------ | :------------------ | :----- | | Corporate Net Operating Expenses | 9.2 | 9.5 | -3.2% | [Domestic Order Counts](index=6&type=section&id=Domestic%20Order%20Counts) In Q2 2025, domestic commercial order opens and closes significantly increased, while purchase orders slightly decreased, and both refinancing order opens and closes grew Domestic Order Counts (Q2 2025 vs Q2 2024) | Order Type | Q2 2025 Opens | Q2 2024 Opens | Q2 2025 Closes | Q2 2024 Closes | | :--------- | :------------ | :------------ | :------------- | :------------- | | Commercial | 4,526 | 3,526 | 4,415 | 3,787 | | Purchase | 52,793 | 55,057 | 35,886 | 37,832 | | Refinance | 19,736 | 16,731 | 12,165 | 9,978 | | Other | 12,591 | 11,407 | 14,128 | 7,902 | | **Total** | **89,646** | **86,721** | **66,594** | **59,499** | [Financial Statements](index=6&type=section&id=Financial%20Statements) This section presents Stewart Company's condensed statements of income, balance sheets, and detailed segment information for the reported periods [Condensed Statements of Income](index=6&type=section&id=Condensed%20Statements%20of%20Income) This section provides detailed GAAP income statement data for the quarters and six months ended June 30, 2025, and 2024, including segment-wise revenues and various expenses Condensed Statements of Income (Selected) | Metric ($ thousand) | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :---------------------------------------- | :------ | :------ | :-------- | :-------- | | Total Operating Revenue | 705,197 | 588,438 | 1,301,472 | 1,122,814 | | Investment Income | 16,257 | 14,306 | 28,913 | 27,207 | | Net Realized and Unrealized Gains (Losses) | 727 | (514) | 3,780 | 6,524 | | Pretax Income (before noncontrolling interests) | 46,776 | 29,005 | 52,676 | 36,151 | | Net Income Attributable to Stewart | 31,922 | 17,343 | 34,999 | 20,473 | | Net Cash Provided by (Used in) Operating Activities | 53,428 | 21,123 | 23,501 | (8,465) | [Condensed Balance Sheets](index=7&type=section&id=Condensed%20Balance%20Sheets) This section presents the company's financial position as of June 30, 2025, and December 31, 2024, detailing assets, liabilities, and stockholders' equity Condensed Balance Sheets (Selected) | Metric ($ thousand) | June 30, 2025 | December 31, 2024 | | :---------------------------------------- | :------------ | :---------------- | | Cash and Cash Equivalents | 178,101 | 216,298 | | Investments in Debt and Equity Securities | 689,743 | 669,098 | | Goodwill | 1,092,747 | 1,084,139 | | Total Assets | 2,781,157 | 2,730,145 | | Notes Payable | 446,000 | 445,841 | | Estimated Title Losses | 523,085 | 511,534 | | Total Liabilities | 1,334,875 | 1,319,056 | | Stockholders' Equity Attributable to Stewart | 1,437,751 | 1,402,142 | | Total Stockholders' Equity | 1,446,282 | 1,411,089 | | Book Value Per Share ($) | 51.46 | 50.50 | [Segment Information (Detailed)](index=8&type=section&id=Segment%20Information%20(Detailed)) This section provides detailed revenue and expense breakdowns by Title, Real Estate Solutions, and Corporate segments for the quarters and six months ended June 30, 2025, and 2024 Segment Information (Selected) | Metric ($ thousand) | Title Segment (Q2 2025) | Real Estate Solutions Segment (Q2 2025) | Corporate and Other (Q2 2025) | Total (Q2 2025) | | :---------------------------------------- | :------------------------ | :---------------------------- | :------------------------ | :-------------- | | Operating Revenue | 592,547 | 112,650 | - | 705,197 | | Investment Income | 16,233 | 24 | - | 16,257 | | Pretax Income (Loss) | 49,314 | 6,741 | (9,279) | 46,776 | | Operating Revenue (H1 2025) | 1,091,745 | 209,727 | - | 1,301,472 | | Pretax Income (Loss) (H1 2025) | 61,080 | 10,800 | (19,204) | 52,676 | [Non-GAAP Financial Measures Reconciliation (Appendix A)](index=9&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation%20(Appendix%20A)) This appendix provides explanations and reconciliations for Stewart Company's non-GAAP financial measures, offering additional insights into core operating performance [Explanation of Non-GAAP Adjustments](index=9&type=section&id=Explanation%20of%20Non-GAAP%20Adjustments) This section explains the non-GAAP financial measures used by management, including adjusted revenue, adjusted pretax income, adjusted net income, adjusted diluted EPS, and adjusted pretax margin, along with the rationale for their use - Adjusted revenue is reported revenue less net realized and unrealized gains and losses[27](index=27&type=chunk) - Adjusted pretax income and adjusted net income are reported pretax income and net income (less noncontrolling interests' earnings) adjusted for net realized and unrealized gains and losses, amortization of acquired intangible assets, and office closing and severance costs[27](index=27&type=chunk) - Management considers these metrics important performance indicators of its core earnings power and believes investors benefit from their presentation[27](index=27&type=chunk) [Reconciliation of Consolidated Non-GAAP Measures](index=9&type=section&id=Reconciliation%20of%20Consolidated%20Non-GAAP%20Measures) This section provides reconciliation tables for consolidated GAAP financial measures to their non-GAAP counterparts for the quarters and six months ended June 30, 2025, and 2024, detailing adjustments for realized/unrealized gains/losses, intangible asset amortization, and office closing/severance costs Reconciliation of Consolidated Non-GAAP Measures (Selected) | Metric | Q2 2025 ($ million) | Q2 2024 ($ million) | H1 2025 ($ million) | H1 2024 ($ million) | | :---------------------------------------- | :------------------ | :------------------ | :------------------ | :------------------ | | Total Revenue | 722.2 | 602.2 | 1,334.2 | 1,156.5 | | Adjusted Total Revenue | 721.5 | 602.7 | 1,330.4 | 1,150.0 | | Pretax Income | 46.8 | 29.0 | 52.7 | 36.2 | | Adjusted Pretax Income | 54.9 | 39.6 | 66.1 | 48.7 | | Net Income Attributable to Stewart | 31.9 | 17.3 | 35.0 | 20.5 | | Adjusted Net Income Attributable to Stewart | 38.0 | 25.4 | 44.9 | 30.0 | [Reconciliation of Segment Non-GAAP Measures](index=11&type=section&id=Reconciliation%20of%20Segment%20Non-GAAP%20Measures) This section provides reconciliation tables for GAAP financial measures to their non-GAAP counterparts for the Title and Real Estate Solutions segments for the quarters and six months ended June 30, 2025, and 2024 Reconciliation of Segment Non-GAAP Measures (Selected) | Metric | Title Segment (Q2 2025, $ million) | Title Segment (Q2 2024, $ million) | Real Estate Solutions Segment (Q2 2025, $ million) | Real Estate Solutions Segment (Q2 2024, $ million) | | :---------------------------------------- | :------------------------- | :------------------------- | :----------------------------- | :----------------------------- | | Revenue | 609.5 | 510.0 | 112.7 | 92.2 | | Adjusted Revenue | 608.8 | 510.5 | 112.7 | 92.2 | | Pretax Income | 49.3 | 33.4 | 6.7 | 5.1 | | Adjusted Pretax Income | 51.9 | 38.4 | 12.2 | 10.6 | | GAAP Pretax Margin | 8.1% | 6.5% | 6.0% | 5.5% | | Adjusted Pretax Margin | 8.5% | 7.5% | 10.9% | 11.5% | [Company Information](index=5&type=section&id=Company%20Information) This section provides essential company information, including details for the Q2 earnings call, an overview of Stewart's services, and cautionary statements regarding forward-looking information [Second Quarter Earnings Call Details](index=5&type=section&id=Second%20Quarter%20Earnings%20Call%20Details) Stewart Company will host a conference call on July 24, 2025, to discuss its Q2 2025 financial results, with details provided for participation and replay access - The conference call will be held on **July 24, 2025, at 8:30 AM ET**[19](index=19&type=chunk) - Participants can join by dialing **800-245-3047 (US)** or **203-518-9765 (International)**, using access code **STCQ225**[19](index=19&type=chunk) - A replay of the call will be available from **11:00 AM ET on July 24, 2025, until midnight on July 31**[19](index=19&type=chunk) [About Stewart](index=5&type=section&id=About%20Stewart) Stewart is a global real estate services company offering products and services through its direct operations, Stewart Trusted Providers™ network, and family of companies, striving to be the premier title services company - Stewart (NYSE-STC) is a **global real estate services company**[20](index=20&type=chunk) - It provides **residential and commercial title insurance, closing and settlement services, and specialized services** for the mortgage and real estate industries[20](index=20&type=chunk) - The company is committed to being the **premier title services company** by partnering with customers for mutual success[20](index=20&type=chunk) [Cautionary Statement Regarding Forward-Looking Statements](index=5&type=section&id=Cautionary%20Statement%20Regarding%20Forward-Looking%20Statements) Certain statements in this press release are forward-looking and subject to various risks and uncertainties that could cause actual results to differ materially, with no obligation for the company to update these statements - Certain statements in the press release, including those regarding Stewart's future business plans and expectations, are **"forward-looking statements"**[21](index=21&type=chunk) - Forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially, including fluctuating economic conditions, tariffs, trade restrictions, geopolitical tensions, and adverse changes in real estate activity levels[21](index=21&type=chunk) - The company expressly disclaims any obligation to update, amend, or clarify any forward-looking statements in this press release unless required by applicable law[21](index=21&type=chunk)

Core Viewpoint - Stewart Information Services Corporation reported significant growth in net income and revenues for the second quarter of 2025, indicating strong operational performance despite challenges in the housing market [1][3][7]. Financial Performance - Net income attributable to Stewart for Q2 2025 was $31.9 million ($1.13 per diluted share), up from $17.3 million ($0.62 per diluted share) in Q2 2024, representing an 84% increase [1][7][31]. - Adjusted net income for Q2 2025 was $38.0 million ($1.34 per diluted share), compared to $25.4 million ($0.91 per diluted share) in Q2 2024, reflecting a 50% increase [1][31]. - Total revenues for Q2 2025 reached $722.2 million, a 20% increase from $602.2 million in Q2 2024 [5][31]. Segment Performance Title Segment - Operating revenues in the title segment increased by $96.3 million (19%) to $592.5 million in Q2 2025, driven by growth in both direct and agency title operations [6][9]. - Investment income in the title segment rose by $2.0 million (14%) to $16.2 million, primarily due to higher interest and dividend income [6][9]. - Pretax income for the title segment was $49.3 million, up 48% from $33.4 million in Q2 2024 [6][31]. Real Estate Solutions Segment - Operating revenues in the real estate solutions segment increased by $20.5 million (22%) to $112.7 million in Q2 2025, driven by higher revenues from credit information and valuation services [13][15]. - Pretax income for this segment rose by 32% to $6.7 million [13][31]. Expense Management - Total operating expenses increased by $83.6 million (18%) in Q2 2025, with employee costs rising by $28.5 million (16%) due to higher incentive compensation and increased salaries [10][17]. - The title loss expense was $21.5 million, slightly higher than $21.1 million in Q2 2024, but as a percentage of title operating revenues, it improved to 3.6% from 4.2% [11][31]. Cash Flow and Operational Efficiency - Net cash provided by operations improved significantly to $53.4 million in Q2 2025, compared to $21.1 million in Q2 2024, driven by higher net income and lower claims payments [19][31]. - Consolidated employee costs as a percentage of total operating revenues improved to 29.5% in Q2 2025 from 30.5% in the prior year quarter [17][18].

Group 1 - Stewart Information Services Corporation declared a cash dividend of $0.50 per share for the second quarter of 2025 [1] - The dividend is payable on June 30, 2025, to common stockholders of record on June 16, 2025 [1] Group 2 - Stewart Information Services Corporation is a global real estate services company [2] - The company offers a range of products and services including residential and commercial title insurance, closing and settlement services, and specialized offerings for the mortgage industry [2] - Stewart provides comprehensive services and deep expertise for real estate transactions through its direct operations and network of Stewart Trusted Providers™ [2]

Part I – Financial Information [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company reported total revenues of $612.0 million for Q1 2025, an increase from $554.3 million in Q1 2024, with net income attributable to Stewart consistent at $3.1 million, while total assets slightly decreased to $2.71 billion and operating cash flow used $29.9 million [Condensed Consolidated Statements of Income and Comprehensive Income (Loss)](index=3&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20INCOME%20AND%20COMPREHENSIVE%20INCOME%20(LOSS)%20(UNAUDITED)) Q1 2025 vs Q1 2024 Income Statement Highlights | Metric | Q1 2025 ($'000) | Q1 2024 ($'000) | Change | | :--- | :--- | :--- | :--- | | **Operating Revenues** | 596,275 | 534,376 | +11.6% | | Total Revenues | 611,984 | 554,315 | +10.4% | | Income before taxes | 5,900 | 7,146 | -17.4% | | **Net Income Attributable to Stewart** | 3,077 | 3,130 | -1.7% | | **Diluted EPS Attributable to Stewart** | $0.11 | $0.11 | No Change | [Condensed Consolidated Balance Sheets](index=4&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) Balance Sheet Highlights (as of March 31, 2025) | Metric | March 31, 2025 ($'000) | Dec 31, 2024 ($'000) | | :--- | :--- | :--- | | Cash and cash equivalents | 148,510 | 216,298 | | Total Investments | 674,842 | 669,099 | | Goodwill | 1,092,747 | 1,084,139 | | **Total Assets** | **2,707,096** | **2,730,145** | | Notes payable | 445,860 | 445,841 | | Estimated title losses | 510,790 | 511,534 | | **Total Liabilities** | **1,299,233** | **1,319,056** | | **Total Stockholders' Equity** | **1,407,863** | **1,411,089** | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS%20(UNAUDITED)) Q1 2025 vs Q1 2024 Cash Flow Summary | Activity | Q1 2025 ($'000) | Q1 2024 ($'000) | | :--- | :--- | :--- | | Cash used by operating activities | (29,927) | (29,588) | | Cash used by investing activities | (20,007) | (47,377) | | Cash used by financing activities | (18,645) | (16,771) | | **Change in cash and cash equivalents** | **(67,788)** | **(95,014)** | [Notes to Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Key notes detail revenue composition, investment portfolio structure, goodwill changes from acquisitions, title loss reserve activity, and segment performance, with statutory reserve funds for title insurance at approximately $539.2 million in investments and $10.3 million in cash, goodwill increasing by $8.6 million due to title segment acquisitions, and the title segment's pretax income rising to $11.8 million while the real estate solutions segment's pretax income fell to $4.1 million - The company maintains statutory reserve funds for its underwriters, which are not available for current claim payments; as of March 31, 2025, these funds included approximately **$539.2 million in investments** and **$10.3 million in cash**[21](index=21&type=chunk) Operating Revenues by Type (Q1 2025 vs Q1 2024) | Revenue Type | Q1 2025 ($'000) | Q1 2024 ($'000) | | :--- | :--- | :--- | | Direct Title Insurance Premiums | 162,824 | 141,699 | | Agency Title Insurance Premiums | 267,518 | 240,772 | | Escrow fees | 34,478 | 33,543 | | Real estate solutions and abstract fees | 113,466 | 97,374 | | Other revenues | 17,989 | 20,988 | | **Total Operating Revenues** | **596,275** | **534,376** | - Goodwill increased by **$8.6 million** in Q1 2025 due to acquisitions of title offices within the title segment[31](index=31&type=chunk) Segment Pretax Income (Q1 2025 vs Q1 2024) | Segment | Q1 2025 Pretax Income ($'000) | Q1 2024 Pretax Income ($'000) | | :--- | :--- | :--- | | Title | 11,767 | 10,181 | | Real estate solutions | 4,059 | 6,732 | | Corporate | (9,926) | (9,767) | | **Consolidated Pretax Income** | **5,900** | **7,146** | [Management's Discussion and Analysis (MD&A)](index=17&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reported net income of $3.1 million ($0.11 per diluted share) for Q1 2025, flat with Q1 2024, with the title segment seeing an 11% increase in operating revenues and a 16% rise in pretax income to $11.8 million, while the real estate solutions segment's revenues grew 17% but higher costs led to a 40% drop in pretax income to $4.1 million, highlighting a challenging market with high mortgage rates but noting improved commercial revenues and a focus on cost management and technology investment [Management's Overview](index=17&type=section&id=MANAGEMENT'S%20OVERVIEW) Net income attributable to Stewart was $3.1 million ($0.11 per diluted share) in Q1 2025, unchanged from Q1 2024, with the title segment's pretax income growing 16% to $11.8 million driven by an 11% revenue increase, while the real estate solutions segment's pretax income fell 40% to $4.1 million despite a 17% revenue increase due to higher operating costs Q1 2025 Financial Highlights | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Income Attributable to Stewart | $3.1 million | $3.1 million | | Diluted EPS | $0.11 | $0.11 | | Pretax Income | $5.9 million | $7.1 million | Title Segment Performance (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Operating Revenues | $499.2 M | $451.4 M | +11% | | Pretax Income | $11.8 M | $10.2 M | +16% | | Pretax Margin | 2.3% | 2.2% | +0.1 ppt | Real Estate Solutions Segment Performance (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Operating Revenues | $97.1 M | $83.0 M | +17% | | Pretax Income | $4.1 M | $6.7 M | -40% | | Pretax Margin | 4.2% | 8.1% | -3.9 ppt | [Results of Operations](index=19&type=section&id=RESULTS%20OF%20OPERATIONS) Operating revenues grew due to a 10% increase in direct title revenues, led by a 39% surge in domestic commercial business, and an 11% rise in agency revenues, with real estate solutions revenues increasing 17% driven by credit information services, though overall expenses also rose, with other operating expenses up 18% due to higher service costs, and the title loss ratio improved to 3.5% from 3.9% due to favorable claims experience - The operating environment in Q1 2025 was characterized by **high mortgage rates (averaging 6.8%)** and rising home prices, which challenged affordability and led to a **2% year-over-year decline in existing home sales**[63](index=63&type=chunk)[64](index=64&type=chunk) Direct Title Revenue Breakdown (Q1 2025 vs Q1 2024) | Category | Q1 2025 ($M) | Q1 2024 ($M) | % Change | | :--- | :--- | :--- | :--- | | Domestic Non-commercial | 134.4 | 135.3 | -1% | | Domestic Commercial | 69.3 | 49.7 | +39% | | International | 28.0 | 25.6 | +9% | | **Total Direct Title Revenues** | **231.7** | **210.6** | **+10%** | Direct Operations Order Count (Q1 2025 vs Q1 2024) | Order Type | Q1 2025 Closed Orders | Q1 2024 Closed Orders | % Change | | :--- | :--- | :--- | :--- | | Commercial | 4,390 | 3,568 | +23% | | Purchase | 26,780 | 29,744 | -10% | | Refinance | 9,898 | 9,353 | +6% | | **Total Closed Orders** | **45,673** | **50,459** | **-9%** | - The title loss ratio improved to **3.5%** of title operating revenues in Q1 2025 from **3.9%** in Q1 2024, attributed to overall favorable claim experience[80](index=80&type=chunk) [Liquidity and Capital Resources](index=23&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) As of March 31, 2025, the company held $869.1 million in total cash and investments, with a significant portion held by its regulated subsidiary, Guaranty, subject to regulatory restrictions, and statutory reserve funds totaling approximately $549.5 million, while the parent company held $19.2 million in cash, and the debt-to-equity ratio was approximately 32%, with the company believing its liquidity is sufficient for ongoing operations, claims, and strategic goals - As of March 31, 2025, total cash and investments were **$869.1 million**; of this, **$471.9 million** was held in the U.S. and the rest internationally, primarily in Canada[88](index=88&type=chunk) - The parent holding company's available cash was **$19.2 million** at quarter-end; a substantial majority of consolidated cash is held by the regulated underwriter, Guaranty, and its use is subject to legal and regulatory restrictions[89](index=89&type=chunk)[90](index=90&type=chunk) Cash Flow Summary (Q1 2025 vs Q1 2024) | Activity | Q1 2025 ($M) | Q1 2024 ($M) | | :--- | :--- | :--- | | Net cash used in operating activities | (29.9) | (29.6) | | Net cash used by investing activities | (20.0) | (47.4) | | Net cash used by financing activities | (18.6) | (16.8) | - The company's debt-to-equity ratio was approximately **32%** and its debt-to-capitalization ratio was **24%** as of March 31, 2025; the line of credit facility was fully available[99](index=99&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=27&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that there have been no material changes in its investment strategies, types of financial instruments held, or associated market risks during the first quarter of 2025 compared to what was disclosed in its 2024 Form 10-K - No material changes to market risk disclosures occurred in Q1 2025[108](index=108&type=chunk) [Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures as of March 31, 2025, and concluded they were effective, with no material changes to the company's internal control over financial reporting during the quarter - The principal executive and financial officers concluded that as of March 31, 2025, the company's disclosure controls and procedures were adequate and effective[109](index=109&type=chunk) - No changes in internal control over financial reporting occurred during Q1 2025 that materially affected, or are reasonably likely to materially affect, internal controls[110](index=110&type=chunk) Part II – Other Information [Legal Proceedings](index=28&type=section&id=Item%201.%20Legal%20Proceedings) The company is subject to claims and lawsuits in the ordinary course of business, and management believes it has adequate reserves and does not expect these proceedings to have a material adverse effect on its financial condition or results of operations - The company does not expect any ordinary course legal proceedings to have a material adverse effect on its financial condition or operations, and believes reserves are adequate[39](index=39&type=chunk)[113](index=113&type=chunk) [Risk Factors](index=28&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the company's risk factors since the filing of its 2024 Form 10-K - No material changes to the company's risk factors were reported for the period[114](index=114&type=chunk) [Use of Proceeds and Stock Repurchases](index=28&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q1 2025, the company did not make any open market repurchases of its Common Stock, but did repurchase approximately 48,300 shares for about $3.4 million to cover statutory income tax withholding on vested restricted stock units for employees - In Q1 2025, the company repurchased approximately **48,300 shares** for **$3.4 million**, solely related to tax withholding on vested employee restricted stock units[115](index=115&type=chunk) [Other Information](index=28&type=section&id=Item%205.%20Other%20Information) The company's book value per share was $50.16 as of March 31, 2025, a slight decrease from $50.50 at the end of 2024, and no directors or Section 16 officers adopted or terminated any Rule 10b5-1 trading plans during the quarter - Book value per share decreased to **$50.16** at March 31, 2025, from **$50.50** at December 31, 2024[116](index=116&type=chunk) - No directors or Section 16 officers adopted or terminated Rule 10b5-1 trading arrangements during Q1 2025[117](index=117&type=chunk)