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)

Financial Data and Key Metrics Changes - In Q1 2025, the company reported net income of $3 million or $0.11 per diluted share on total revenues of $612 million, with adjusted net income of $7 million or $0.25 per diluted share compared to $5 million or $0.17 in Q1 2024 [22][23] - The title segment's operating revenues included $48 million or 11% growth driven by domestic, commercial, and agency title operations, resulting in a $2 million increase in title pre-tax income [23] - The title loss ratio improved to 3.5% compared to 3.9% in the prior year quarter, with expectations for title losses to average in the low 4% range for the full year 2025 [27] Business Line Data and Key Metrics Changes - The title segment grew by 11%, while real estate solutions grew by 17% in Q1 2025 [8][12] - Domestic commercial revenues improved by $20 million or 39%, driven by higher transaction size and volume, with average fee per file increasing 13% to $15,800 [25] - The real estate solutions segment's operating revenues increased by $14 million or 7%, primarily from credit information services, although pre-tax income decreased due to higher costs [28] Market Data and Key Metrics Changes - Existing home sales remained low, with pending home sales for February down 3.6% from last year, indicating a weaker market [6] - The company noted improved housing inventories and market activity trends in early April, suggesting potential recovery in the second half of the year [7] - International revenue grew by 16% compared to the previous year, with a focus on expanding geographical presence in Canada [15] Company Strategy and Development Direction - The company aims to grow through acquisitions and is maintaining a warm pipeline of targets, expecting increased activity with market improvements [10] - Focus on expanding agency services and targeting shared growth in 15 important states, with gross agency revenue improving by 11% year-over-year [11] - The company is dedicated to growing share across all business lines and positioning itself for long-term growth and sustainability [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to capitalize on an improving market in the second half of 2025 and into 2026, despite current challenges [20] - The CEO highlighted a strong team focused on executing the strategic plan and improving the company's performance [18] - Management acknowledged the volatility in the market but noted that they have not seen a material change in orders yet [35] Other Important Information - The company reported total cash and investments of approximately $320 million in excess of statutory premium reserve requirements, with a fully available $200 million line of credit [29] - Total stockholder's equity was approximately $1.4 billion with a book value of $50 per share [30] Q&A Session Summary Question: Inquiry about commercial activity and potential slowdown - Management indicated that commercial activity remains robust, with expectations for double-digit growth despite some market volatility [34][35] Question: Clarification on investment income decline - The decline was primarily due to lower escrow balances [37] Question: Commentary on loss provision rate and potential volatility - Management noted that the mix of international business contributes to higher claim rates and volatility, maintaining a cautious approach to loss provisions [46][48] Question: Fee per file growth specifics - The residential fee per file increased by 13%, driven by a higher percentage of purchase transactions [50][52] Question: Impact of Texas Department of Insurance fee cut - Management is challenging the fee cut and believes it could impact agents' existence, but they have plans to manage through it [56][57]

Financial Data and Key Metrics Changes - The company reported a net income of $3 million or $0.11 per diluted share on total revenues of $612 million for Q1 2025, with adjusted net income of $7 million or $0.25 per diluted share compared to $5 million or $0.17 in Q1 2024 [16][18] - The title segment's operating revenues increased by $48 million or 11%, leading to a $2 million increase in title pretax income, with adjusted pretax income improving to $12 million, up $5 million from last year [18][19] - The title loss ratio improved to 3.5% compared to 3.9% in the prior year quarter, with expectations for title losses to average in the low 4% range for the full year 2025 [20][22] Business Line Data and Key Metrics Changes - The Title segment grew by 11%, with domestic commercial business growing 39% year-over-year, driven by strong performance in retail, mixed-use, and energy asset classes [7][19] - Real Estate Solutions segment revenues increased by $14 million or 7%, but pretax income decreased due to higher credit information costs and employee expenses [21] - Agency Services saw gross agency revenues improve by $27 million or 11%, with net agency revenues increasing by $5 million or 13% [20] Market Data and Key Metrics Changes - Existing home sales remained low, with pending home sales for February down 3.6% from last year, indicating a challenging market environment [6] - The company noted improved housing inventories and market activity trends in early April, suggesting potential for recovery in the second half of the year [7] - International revenue grew by 16% compared to the previous year, with a focus on expanding geographical presence in Canada [11] Company Strategy and Development Direction - The company is focused on growth through acquisitions and expanding its market share in targeted metropolitan statistical areas (MSAs) [8][9] - There is a commitment to enhancing service offerings for agent partners and pursuing growth across existing markets, particularly in 15 key states [9][10] - The management emphasized the importance of positioning for long-term growth and sustainability despite current market challenges [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to capitalize on an improving market in the second half of 2025 and into 2026 [14] - The CEO highlighted the robust nature of the commercial market, expecting double-digit growth despite some volatility [26] - Management acknowledged the challenges posed by the Texas Department of Insurance fee cuts but indicated plans to manage through these changes [41][43] Other Important Information - The company has a solid financial position with total cash and investments of approximately $320 million in excess of statutory premium reserve requirements [22] - The employee cost ratio improved to 31% from 32% year-over-year, while other operating expense ratios increased to 27% due to higher costs in real estate solutions and commercial operations [22] Q&A Session Summary Question: Inquiry about commercial activity and potential slowdown - Management indicated that commercial activity remains robust, with expectations for double-digit growth despite some market volatility [26] Question: Clarification on investment income decline - The decline in investment income was primarily due to lower escrow balances [28] Question: Commentary on loss provision rate and potential volatility - Management noted that the loss provision rate is closely monitored, with potential volatility due to the mix of business, particularly in international operations [35][36] Question: Growth in residential purchase fee per file - The residential fee per file increased by 13%, driven by a higher percentage of purchase transactions [39] Question: Impact of Texas Department of Insurance fee cuts - Management is challenging the fee cuts and believes adjustments can be made to manage through the changes [42][43]

Financial Performance - Total revenues for Q1 2025 were $612.0 million, an increase of 10.4% from $554.3 million in Q1 2024[5] - Adjusted net income for Q1 2025 was $7.0 million ($0.25 per diluted share), up from $4.6 million ($0.17 per diluted share) in Q1 2024, representing a 52.2% increase[2][5] - Total revenues for the quarter ended March 31, 2025, were $612.0 million, representing a 10% increase from $554.3 million in the same quarter of 2024[29] - Adjusted net income attributable to Stewart for Q1 2025 was $7.0 million, a 51% increase compared to $4.6 million in Q1 2024[30] - The Title Segment reported total revenues of $514.9 million, up 9% from $471.4 million in the previous year[30] - The Real Estate Solutions Segment achieved total revenues of $97.1 million, reflecting a 17% increase from $83.0 million in Q1 2024[30] - Adjusted total revenues for Q1 2025 were $608.9 million, an 11% increase from $547.3 million in Q1 2024[29] Segment Performance - Title segment operating revenues increased by $47.8 million (11%) to $499.2 million in Q1 2025 compared to Q1 2024[7][8] - Direct title revenues rose by 10% to $231.7 million in Q1 2025, driven by a 39% increase in domestic commercial revenues[11] - Real estate solutions segment operating revenues improved by $14.1 million (17%) to $97.1 million in Q1 2025[12][13] - Adjusted pretax income for the Title Segment rose by 77% to $11.5 million, compared to $6.5 million in Q1 2024[30] Operational Metrics - Total opened orders for Q1 2025 reached 78,943, a 6.5% increase compared to 79,335 in Q1 2024[24] - Closed orders for Q1 2025 totaled 45,673, reflecting a 9.7% decrease from 50,459 in Q1 2024[24] - Commercial opened orders in Q1 2025 were 4,328, up from 3,693 in Q1 2024, indicating an 17.3% increase[24] - Purchase opened orders in Q1 2025 amounted to 46,250, compared to 48,024 in Q1 2024, showing a decrease of 3.7%[24] - Refinancing opened orders for Q1 2025 were 17,562, which is a 7.3% increase from 16,371 in Q1 2024[24] - Other opened orders in Q1 2025 totaled 10,803, down from 11,247 in Q1 2024, representing a decrease of 4.0%[24] - Closed commercial orders in Q1 2025 were 4,390, slightly higher than 3,568 in Q1 2024, marking a 23.1% increase[24] - Closed purchase orders in Q1 2025 totaled 26,780, down from 29,744 in Q1 2024, reflecting a decrease of 10.0%[24] - Closed refinancing orders in Q1 2025 were 9,898, compared to 9,353 in Q1 2024, indicating a 5.8% increase[24] - Closed other orders in Q1 2025 reached 4,605, a decrease from 7,794 in Q1 2024, showing a decline of 41.0%[24] Financial Position - Total assets as of March 31, 2025, were $1,485,510,021, compared to $1,298,000,000 as of December 31, 2024, reflecting a significant increase[25] - Cash and cash equivalents amounted to $674,842,669 as of March 31, 2025, up from $609,800,000 as of December 31, 2024[25] - The company reported receivables from premiums of $359,984,336 as of March 31, 2025, compared to $375,753,000 as of December 31, 2024, indicating a decrease[25] - Total liabilities were $1,145,323,111 as of March 31, 2025, compared to $1,183,511,000 as of December 31, 2024, showing a reduction in liabilities[25] - The estimated title losses were $510,790,511 as of March 31, 2025, compared to $534,000,000 as of December 31, 2024, indicating a decrease in estimated losses[25] - The company's total stockholders' equity was $1,407,863,000 as of March 31, 2025, compared to $1,411,089,000 as of December 31, 2024, showing a slight decline[25] - The number of shares outstanding was 27,919,927 as of March 31, 2025, compared to 27,764,000 as of December 31, 2024, indicating an increase in shares[25] - The company reported retained earnings of $1,078,378,000 as of March 31, 2025, compared to $1,089,484,000 as of December 31, 2024, reflecting a decrease[25] - Goodwill was reported at $1,092,747,000 as of March 31, 2025, compared to $1,084,139,000 as of December 31, 2024, indicating an increase[25] - The company has short-term investments of $457,164,000 as of March 31, 2025, compared to $419,000,000 as of December 31, 2024, showing growth in investments[25] Cost and Margin Analysis - Consolidated employee costs increased by $13.4 million (8%) in Q1 2025, but as a percentage of total operating revenues, they improved to 31.2% from 32.3% in the prior year[15] - Employee costs increased to $185.8 million in Q1 2025 from $172.4 million in Q1 2024, reflecting a rise in operational expenses[26] - The company's GAAP pretax margin for Q1 2025 was 1.0%, down from 1.3% in Q1 2024[29] - The adjusted pretax margin improved to 1.8% in Q1 2025, compared to 1.7% in the same quarter of 2024[29] Gains and Losses - Total net realized and unrealized gains in Q1 2025 were $3.1 million, down 57% from $7.1 million in Q1 2024[3][7] - Net realized and unrealized gains for Q1 2025 were $(3.1) million, compared to $(7.0) million in Q1 2024[30] - Title loss expense for Q1 2025 was $17.7 million, representing 3.5% of title operating revenues, an improvement from 3.9% in Q1 2024[10] Future Outlook - The company plans to focus on market growth and pretax margin improvements in the future[21]

Core Viewpoint - Stewart Information Services Corporation reported stable net income for Q1 2025, with total revenues increasing by 10% compared to Q1 2024, reflecting strong performance across all segments despite a challenging macro environment [3][6][27]. Financial Performance - Net income attributable to Stewart for Q1 2025 was $3.1 million ($0.11 per diluted share), unchanged from Q1 2024, while adjusted net income increased to $7.0 million ($0.25 per diluted share) from $4.6 million ($0.17 per diluted share) in the prior year [1][6][27]. - Total revenues for Q1 2025 were $612.0 million, compared to $554.3 million in Q1 2024, marking a 10% increase [4][6][27]. - Adjusted pretax income for Q1 2025 was $11.2 million, up 22% from $9.1 million in Q1 2024, with an adjusted pretax margin of 1.8% compared to 1.7% in the prior year [27][28]. Segment Performance - The title segment's operating revenues increased by 11% to $499.2 million in Q1 2025 from $451.4 million in Q1 2024, driven by improvements in both direct and agency title operations [5][8]. - The real estate solutions segment saw a 17% increase in operating revenues to $97.1 million in Q1 2025, although pretax income decreased by 40% to $4.1 million [12][13]. - Direct title revenues rose by 10% to $231.7 million, with domestic commercial revenues increasing by 39% due to higher average transaction sizes and closed transactions [11][12]. Expense Management - Consolidated employee costs increased by 8% to $185.8 million in Q1 2025, primarily due to higher incentive compensation and salaries [15][16]. - Other operating expenses rose by 18% to $160.9 million, driven by increased service expenses in real estate solutions and commercial title operations [16][15]. Cash Flow and Balance Sheet - Net cash used by operations in Q1 2025 was $29.9 million, comparable to $29.6 million in Q1 2024 [17]. - As of March 31, 2025, total assets were $2.7 billion, with stockholders' equity attributable to Stewart at $1.4 billion [23][24].

Group 1 - Stewart Information Services Corporation declared a cash dividend of $0.50 per share for the first quarter of 2025 [1] - The dividend is payable on March 31, 2025, to common stockholders of record on March 17, 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]

Company Overview - Stewart Information Services Corporation operates in three segments: title insurance and related services, real estate solutions, and corporate[13]. - The corporate segment included results from a real estate brokerage company acquired in late 2021 and sold in Q2 2022[35]. Title Insurance Segment - The title segment includes services such as searching, examining, closing, and insuring real property titles, as well as home and personal insurance services[14]. - Title insurance revenues are closely related to real estate market activity, including interest rates and home sales volumes[25]. - The primary customers for title insurance include attorneys, builders, developers, home buyers, sellers, lenders, and real estate brokers[26]. - The demand for title insurance-related services is primarily influenced by the volume of real estate transactions, which is affected by mortgage interest rates and overall economic conditions[57]. - Stewart's claims experience may require an increase in provisions for title losses, which could adversely affect earnings[59]. - The company faces intense competition in the title insurance industry, with larger competitors having substantially greater revenues and capital[61]. - Total direct title revenues in 2024 improved by 6% to $1,020.4 million compared to $962.7 million in 2023, primarily driven by increased commercial revenues[135]. - Title losses in 2024 were $80.4 million, comparable to 2023, with a title loss ratio of 3.9%[151]. Financial Performance - Net income attributable to Stewart for 2024 was $73.3 million, or $2.61 per diluted share, compared to $30.4 million, or $1.11 per diluted share, in 2023[108]. - Total operating revenues increased by 10% to $2.42 billion in 2024, up from $2.21 billion in 2023, while total expenses increased by 8% to $2.38 billion[108]. - For Q4 2024, net income attributable to Stewart was $22.7 million ($0.80 per diluted share), compared to $8.8 million ($0.32 per diluted share) in Q4 2023[109]. - Title segment operating revenues for Q4 2024 were $562.7 million, a 12% increase from $503.0 million in Q4 2023[111]. - Real estate solutions revenues increased by $95 million, or 36%, in 2024 compared to 2023, driven by higher revenues from credit information and valuation management services[139]. - Investment income improved by $10.2 million, or 23%, in 2024 compared to 2023, primarily due to higher interest income from escrow balances[140]. Employee and Workplace Culture - The company employed approximately 7,000 people as of December 31, 2024, with about 5,500 employees in the U.S. and 1,500 internationally[38]. - Stewart was recognized as a 2024 Top Workplace by the Houston Chronicle and received three Culture Excellence Awards for employee well-being, appreciation, and professional development[45]. - The company focuses on recruiting strategies that emphasize fairness, equity, and inclusivity in employment practices[39]. - The company is committed to providing an inclusive workplace and has established a Global Inclusion Council to support employee advancement and engagement[41]. Risk Management - Cybersecurity threats pose a risk to Stewart's operations, as successful breaches could lead to loss of sensitive data and increased costs[62]. - Errors and fraud related to fund transfers are potential risks that could result in financial losses for Stewart[63]. - The company has an enterprise risk management program to assess and manage cybersecurity risks alongside other critical business risks[84]. - The Board oversees management's assessment of significant risks, including cybersecurity, and receives regular updates on risk exposure[90]. - The company’s enterprise risk management program is in place to assess and manage risks, but it may not adequately address all emerging risks[55]. Economic and Market Conditions - Economic conditions, particularly mortgage interest rates and real estate activity, significantly impact Stewart's revenues and earnings, which have historically fluctuated due to these factors[56]. - Climate change and extreme weather events could adversely impact the company's operations and financial performance, affecting the real estate market and investment portfolio[65]. - Widespread health crises may disrupt the real estate market, leading to decreased order volumes and delayed transactions, significantly impacting future results[66]. - The average 30-year mortgage interest rate for 2024 was 6.72%, down from 6.80% in 2023, following several interest rate reductions by the federal government[130]. - Existing home sales in 2024 were 4.05 million, a slight decrease from 4.10 million in 2023, primarily due to elevated interest rates and low housing inventory[130]. Regulatory and Compliance - The company is subject to extensive government regulations that could impede revenue growth and operational results[69]. - The company may face increased costs and difficulties in acquiring necessary data due to regulatory compliance burdens[64]. - The company relies on dividends from its insurance subsidiaries for capital planning, which may be restricted by state regulations[73]. Investments and Capital Management - As of December 31, 2024, total cash and investments amounted to $926.6 million, with $523.4 million held in the U.S.[156]. - The company used $14.4 million for acquisitions in 2024, consistent with its strategy to increase scale and growth in key markets[166]. - Cash used for purchases of securities investments was $121.5 million in 2024, compared to $78.0 million in 2023[165]. - The company expects cash flows from operations and cash available from underwriters to be sufficient to fund operations, including claims payments[171]. Internal Controls and Governance - Management assessed the effectiveness of internal control over financial reporting as of December 31, 2024, and concluded that it is effective based on COSO criteria[188]. - The company’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting[188]. - Management believes that inherent limitations in internal control systems can lead to material misstatements not being prevented or detected[189]. - The company has adopted an insider trading policy applicable to all directors, officers, and employees[195].

Financial Data and Key Metrics Changes - In Q4 2024, the company reported net income of $23 million or $0.80 per diluted share on total revenue of $666 million [32] - Adjusted net income for Q4 was $32 million or $1.12 per diluted share, compared to $17 million or $0.60 per diluted share in Q4 2023 [33] - For the full year 2024, revenues grew by 10% and adjusted net earnings increased by 42% [7] Business Line Data and Key Metrics Changes - The Title segment saw operating revenues increase by $60 million or 12%, with pretax income rising by $18 million or 65% [33] - Domestic Commercial operations improved revenues by $28 million or 50%, driven by higher transaction sizes and volumes [35] - Real Estate Solutions segment operating revenues improved by $26 million, but pretax income declined due to vendor price increases and elevated employee costs [37] Market Data and Key Metrics Changes - Existing home sales were at multi-decade lows, with the housing market needing significant improvement to return to normal levels [15][17] - The company expects the housing market to remain choppy in 2025, with a transition to more normal existing home sales anticipated in the second half of the year [17][18] Company Strategy and Development Direction - The company is focused on expanding its market share in targeted metropolitan statistical areas (MSAs) through both organic and inorganic means [20] - Investments in talent across Commercial operations are aimed at maximizing growth potential [22] - The company aims to achieve low double-digit pretax margins as the macro market returns to historically normal levels [29] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by the housing market but expressed optimism about the company's growth plans and resilience [7][15] - The company anticipates modest growth in the Commercial segment for 2025, with a focus on specific sectors like data centers [46][48] - Management expects continued momentum in Real Estate Solutions as market conditions improve [26] Other Important Information - The company announced a cash dividend increase to $2 per share, reflecting its strength and commitment to shareholders [13] - Total cash and investments at year-end were approximately $380 million, with a fully available $200 million line of credit [39] Q&A Session Summary Question: Expectations for Commercial growth in 2025 - Management expects modest growth in the Commercial segment for 2025, with uncertainty in the market [45][46] Question: Margins in Real Estate Solutions segment - Management indicated that pricing changes are being implemented, and margins are expected to improve as client relationships mature [52][54] Question: Loss provision rate expectations - Management tightened the loss provision rate expectations to low 4%, citing favorable macro conditions [70][74] Question: Investment income expectations - Management expects investment income to remain stable in the $13 million range, with potential fluctuations based on market conditions [76]

Financial Performance - Fourth quarter 2024 net income attributable to Stewart was $22.7 million ($0.80 per diluted share), a significant increase from $8.8 million ($0.32 per diluted share) in the fourth quarter 2023, representing a 158% year-over-year growth[2]. - Full year 2024 net income was $73.3 million ($2.61 per diluted share), compared to $30.4 million ($1.11 per diluted share) in 2023, marking a 141% increase[4]. - Net income attributable to Stewart for the year 2024 was $73.3 million, up 141.5% from $30.4 million in 2023[23]. - Net earnings per diluted share attributable to Stewart increased to $2.61 in 2024, compared to $1.11 in 2023[23]. - Adjusted net income attributable to Stewart rose by 90% to $31.5 million for Q4 2024, and by 42% to $94.4 million for the year 2024[29]. Revenue Growth - Total revenues for the fourth quarter 2024 reached $665.9 million, up 14.4% from $582.2 million in the same quarter of 2023[4]. - Total operating revenues for Q4 2024 reached $649.7 million, a 15.1% increase from $564.4 million in Q4 2023[23]. - Total revenues for the Title Segment grew by 11% to $580.0 million in Q4 2024, and by 7% to $2,133.0 million for the year 2024[29]. - Adjusted total revenues for the year ended December 31, 2024, were $2,477.5 million, reflecting a 10% growth compared to $2,257.3 million in 2023[28]. - Real Estate Solutions Segment total revenues surged by 42% to $87.0 million in Q4 2024, and by 36% to $358.7 million for the year 2024[29]. Operational Efficiency - Adjusted pretax margin improved to 7.1% in the fourth quarter 2024, up from 5.0% in the prior year quarter, reflecting operational efficiency[5]. - The GAAP pretax margin improved to 5.3% in Q4 2024 from 3.2% in Q4 2023[28]. - The company’s adjusted pretax margin for Q4 2024 was 7.1%, up from 5.0% in Q4 2023[28]. - Adjusted pretax income for the Title Segment rose by 61% to $50.5 million in Q4 2024, and by 20% to $138.9 million for the year 2024[29]. - GAAP pretax margin improved to 7.8% in Q4 2024, and to 6.3% for the year 2024, compared to 5.2% and 4.9% in the previous year respectively[29]. Cash Flow and Expenses - Total cash provided by operations in the fourth quarter 2024 was $68.0 million, compared to $39.5 million in the fourth quarter 2023, indicating improved cash flow generation[18]. - Employee costs increased by $21.3 million, or 12%, in the fourth quarter 2024, primarily due to higher incentive compensation and increased salaries[15]. - Total expenses for the year ended December 31, 2024, were $2,376.1 million, compared to $2,196.5 million in 2023[28]. - Employee costs for Q4 2024 totaled $199.4 million, reflecting a 11.9% increase from $178.1 million in Q4 2023[23]. Market Conditions and Future Outlook - The company plans to continue focusing on growth and margin improvement across all business lines in 2025, despite challenging macro-housing conditions[4]. - The number of opened commercial orders in Q4 2024 was 4,283, slightly down from 4,303 in Q4 2023[23]. - The total number of purchase orders opened in Q4 2024 was 39,399, compared to 42,750 in Q4 2023, indicating a decrease of 7.4%[23]. Asset and Equity Changes - Cash and cash equivalents increased to $216,298,233 from $336,365[24]. - Short-term investments rose to $41,199,393 from $23,936[24]. - Total assets net increased to $102,210,115 from $87,899[24]. - Total stockholders' equity reached $1,411,089,891 from $378,549[24]. - Book value per share is $50.50[24].