Stewart Information Services Corporation (NYSE:STC) Q1 2023 Results Conference Call April 27, 2023 8:30 AM ET Company Participants Brian Glaze - Principal Accounting Officer, Senior VP and Controller Frederick Eppinger - CEO and Director David Hisey - CFO and Treasurer Conference Call Participants Bose George - KBW John Campbell - Stephens Inc Geoffrey Dunn - Dowling & Partners Operator Hello, and thank you for joining the Stewart Information Services First Quarter 2023 Earnings Call. [Operator Instructions ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-02658 STEWART INFORMATION SERVICES CORPORATION (Exact name of registrant as specified in its charter) | Delaware | | 74-1677330 | | --- | --- | --- | | (Stat ...

Financial Data and Key Metrics Changes - In Q4 2022, the company reported a net income of $30 million and diluted earnings per share of $0.49 on total revenues of $656 million, a decrease from $84 million or $3.05 per diluted share in Q4 2021 [28] - Adjusted pretax income for the segment was $35 million compared to $120 million in the prior year quarter, with an adjusted pretax margin of 5.9% versus 14.4% in the previous year [29] - Total title revenues decreased by $255 million or 30% primarily due to volume declines driven by higher interest rates [54] Business Line Data and Key Metrics Changes - Domestic residential revenues decreased by $94 million, or 32%, due to lower purchase and refinancing transactions, although residential fee per file increased by 45% to approximately $3,500 from $2,400 last year [30] - Revenues from agency operations decreased by $133 million or 30% compared to the previous year, with the average agency remittance rate slightly decreasing to 17.6% from 18% [31] - Domestic commercial revenues decreased by $26 million, or 28%, primarily due to lower transaction volume and size, with average commercial fee per file at $15,100 compared to $19,700 for the prior year quarter [55] Market Data and Key Metrics Changes - Total open and closed orders declined by 48% and 51% respectively in Q4 compared to last year, primarily due to the economic environment [56] - International revenues were $16 million or 34% lower, primarily due to lower transaction volumes in Canadian operations [56] - Title losses were 3.8% of total revenues compared to 4.2% in 2021, with expectations for 2023 title losses to be at least at 2021 levels [32] Company Strategy and Development Direction - The company aims to improve competitive positioning by being more efficient and maintaining a disciplined operating model, focusing on growing scale in attractive markets across all business lines [22] - Significant investments in talent and technology were made during 2022 to enhance operational capabilities and customer experience [17][24] - The company is optimistic about long-term growth in the commercial market despite short-term headwinds due to changing financial markets [26] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by a higher interest rate environment, which peaked over 7%, and indicated that this difficult market is expected to continue into 2023 [20] - The first quarter is anticipated to be challenging, but there are signs of improvement with order counts increasing in January [96] - Management remains focused on maintaining financial strength while strategically investing in capabilities to position the company for long-term growth [21][52] Other Important Information - The company has a strong financial position with total cash and investments of approximately $430 million and a fully available $200 million line of credit [60] - Employee costs as a percentage of operating revenues increased to 30% in Q4 compared to 23% in the prior year quarter, primarily due to lower operating revenues [34] Q&A Session Summary Question: What is the outlook for margins in 2023? - Management indicated that the first quarter will be challenging, but improvements are expected as the market stabilizes and order volumes increase [93][94] Question: How do recent acquisitions impact the business? - The company discussed the strategic importance of recent acquisitions like BCHH and FNC, which are expected to enhance service offerings and market presence [40][50] Question: What are the expectations for the commercial market? - Management expressed optimism for the commercial market in 2023, despite some sectors facing challenges, and noted strong growth in the energy sector [84][106]

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 or For the transition period from to Commission file number 001-02658 STEWART INFORMATION SERVICES CORPORATION (Exact name of registrant as specified in its charter) | Delaware | | 74-1677 ...

Stewart Information Services Corporation (NYSE:STC) Q3 2022 Earnings Conference Call October 27, 2022 8:30 AM ET Company Participants Brian Glaze - Chief Accounting Officer Frederick Eppinger - Chief Executive Officer David Hisey - Chief Financial Officer Conference Call Participants John Campbell - Stephens Geoffrey Dunn - Dowling & Partners Operator Hello and thank you for joining the Stewart Information Services Third Quarter 2022 Earnings Call. At this time all participants are in a listen-only mode. La ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-02658 STEWART INFORMATION SERVICES CORPORATION (Exact name of registrant as specified in its charter) | Delaware | | 74-1677330 | ...

Stewart Information Services Corporation (NYSE:STC) Q2 2022 Earnings Conference Call July 28, 2022 8:30 AM ET Company Participants Brian Glaze - CAO Fred Eppinger - CEO David Hisey - CFO Conference Call Participants Bose George - KBW John Campbell - Stephens Inc. Geoffrey Dunn - Dowling & Partners Ryan Gilbert - BTIG Operator Hello and thank you for joining the Stewart Information Services Second Quarter 2022 Earnings Call. At this time all participants are in a listen-only mode. Later you will have an oppo ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission file number 001-02658 STEWART INFORMATION SERVICES CORPORATION (Exact name of registrant as specified in its charter) | Delaware | | 74-1677330 ...

Financial Data and Key Metrics Changes - Stewart reported net income of $58 million and diluted earnings per share of $2.11 on total revenues of $853 million for Q1 2022 [21] - Adjusted net income for the first quarter was $56 million, which was 8% higher compared to the same quarter last year [21] - Total Title revenues for the quarter increased by $97 million or 15% compared to last year's quarter [23] - Title pre-tax margin for Q1 2022 was 11.4% compared to 12.2% in the previous year [24] Business Line Data and Key Metrics Changes - Domestic commercial revenues improved by $27 million, driven by increased transaction volume and a 47% higher average fee per file of $12,700 [25] - Domestic residential revenues increased by $4 million or 2% due to higher purchase transactions [25] - Agency operations generated revenues of $404 million, which is 17% higher than last year [28] - Total open and closed orders in Q1 decreased by 26% and 24% respectively, primarily due to lower refinancing transactions [27] Market Data and Key Metrics Changes - The residential real estate market continues to see demand driven by favorable demographics [18] - Commercial real estate is experiencing activity across most asset classes, with energy poised to benefit from supply and environmental focus [18] - The average agency remittance rate improved to 18.1%, compared to 17.1% in the previous year [28] Company Strategy and Development Direction - The company is focused on becoming the premier title service company by improving margins, growth, and resiliency [6][9] - Investments in technology have enhanced customer experience and operational capabilities [7][11] - The company aims to gain scale in priority markets and deepen agency partnerships [12][14] Management's Comments on Operating Environment and Future Outlook - Management remains confident in their ability to manage through traditional market conditions and is bullish on long-term prospects [9][17] - The company is focused on managing business areas that will have a meaningful impact on long-term performance [20] - Management acknowledges potential risks from Fed policies, inflation, and global conflicts affecting supply chains [19] Other Important Information - Total cash and investments on the balance sheet are approximately $560 million, with a fully available $200 million line of credit facility [31] - Stockholders' equity attributable to Stewart was approximately $1.312 billion, with a book value per share of approximately $49, an increase of 2% from the previous year [31] Q&A Session Summary Question: Are the recent acquisitions fully reflected in this quarter's numbers? - Management indicated that the full effect of acquisitions from the previous quarter is still being realized, with ongoing integrations [35][37] Question: Can you discuss commercial and purchase trends for the second quarter? - Management noted improvements across asset classes in commercial real estate and expressed optimism for continued growth [42][44] Question: How do you view the balance between M&A and stock buybacks in the current environment? - The focus remains on building the business, with M&A being a priority as all transactions have been accretive [61] Question: What is the current cost structure regarding fixed versus variable costs? - Management explained that the cost structure varies by business, with a significant portion being variable due to the transactional nature of operations [66] Question: How is the market trending in terms of purchase and refinance volumes? - Management acknowledged a slight negative impact from rising mortgage rates but noted that the market remains transitional [72][73]

Business Segments - Stewart Information Services Corporation operates in two segments: title insurance and related services, and ancillary services and corporate[13]. - The title segment includes services such as searching, examining, closing, and insuring real property titles, as well as home and personal insurance services[14]. - The ancillary services segment supports the mortgage industry with services such as appraisal management and online notarization, enhancing the real estate transaction lifecycle[34]. Financial Performance - In 2021, net income attributable to Stewart was $323.2 million, or $11.90 per diluted share, a 109% increase from $154.9 million, or $6.22 per diluted share, in 2020[97]. - Total revenues for 2021 increased by 45% to $3.3 billion, up from $2.3 billion in 2020, driven by increased transaction volumes and acquisitions[97]. - Total operating expenses rose by 39% to $2.9 billion in 2021, compared to $2.1 billion in 2020, consistent with revenue growth[97]. - For Q4 2021, net income attributable to Stewart was $85.5 million ($3.12 per diluted share), compared to $59.7 million ($2.22 per diluted share) in Q4 2020[98]. - Q4 2021 pretax income before noncontrolling interests was $114.1 million, an increase from $83.9 million in Q4 2020[98]. - The company paid dividends of $293.9 million in 2021, including an extraordinary dividend of $135.0 million, compared to $30.0 million in 2020[153]. Market Conditions - Title insurance revenues are closely related to real estate market activity, interest rates, and consumer confidence, with the first quarter typically being the least active[26]. - The demand for title insurance-related and mortgage services is primarily dependent on the volume of real estate transactions, which is influenced by mortgage interest rates and overall economic conditions[59]. - The company’s revenues and results of operations are affected by changes in economic conditions, particularly mortgage interest rates and real estate prices[58]. - The average 30-year mortgage interest fixed rate is anticipated to climb to 3.6% in 2022, which may further reduce refinancing lending and limit home affordability[124]. Employee and Operational Metrics - As of December 31, 2021, the company employed approximately 7,300 people, with about 6,400 located in the U.S.[40]. - Employee costs increased by 27% to $777.0 million in 2021, while other operating expenses rose by 67% to $626.8 million[134]. - Total employee counts rose to approximately 7,300 in 2021 from 5,800 in 2020 and 5,300 in 2019, with average cost per employee increasing by 5% in 2021 and 7% in 2020[136]. Cybersecurity and Compliance - The company has experienced no known material cyber breaches during the three-year period ended December 31, 2021, and has a comprehensive cybersecurity framework in place[48]. - The company regularly assesses its cybersecurity against the National Institute of Standards and Technology (NIST CSF) and SSAE-18 standards[49]. - Regulatory compliance is crucial, as downgrades by rating agencies could negatively impact revenue and customer retention[69]. Investment and Financial Risks - As of December 31, 2021, approximately 87% of the company's combined debt and equity securities investment portfolios consisted of fixed income securities, with 93% of these rated A or higher[38]. - The investment portfolio is exposed to interest rate and credit risks, which could lead to material adverse effects on financial condition[78]. - A 100 basis-point increase in interest rates would result in a decrease of approximately $19.8 million, or 3.4%, in the fair value of the debt securities portfolio[176]. Acquisitions and Growth - The company acquired Cloudvirga, a digital customer engagement platform, and several title offices in various states to enhance its competitive position[31]. - The company invested $600.0 million in acquisitions of title and ancillary services businesses in 2021, significantly higher than $200.0 million in 2020[159]. - Ancillary services revenues improved by $177.1 million, or 214%, in 2021 compared to 2020, primarily due to revenues from new acquisitions[132]. Financial Position and Cash Flow - The company held total cash and investments of $1.2 billion as of December 31, 2021, with $798.3 million held in the U.S.[149]. - Net cash provided by operating activities was $390.3 million in 2021, an increase of $114.5 million compared to 2020, attributed to higher net income and lower claims payments[156]. - Total debt as of December 31, 2021, was $483.5 million, with stockholders' equity at $1.3 billion, resulting in a debt-to-equity ratio of approximately 34%[160]. Title Insurance Metrics - Total provisions for title losses as a percentage of title operating revenues were 4.2% in 2021, down from 5.3% in 2020[108]. - Title loss expense decreased by $13.1 million, or 28%, in Q4 2021, with a title loss ratio of 3.9% compared to 6.8% in the prior year quarter[101]. - Total estimated title losses as of December 31, 2021, were $549.6 million, up from $496.3 million in 2020, with known claims reserves at $75.9 million and IBNR at $473.7 million[146]. Audit and Internal Controls - The audit of the company's internal control over financial reporting as of December 31, 2021, was found to be effective[208]. - The company has implemented safeguards to reduce the risk of material misstatements in financial reporting, acknowledging inherent limitations in internal control systems[182]. - The financial statements and schedules filed as part of the report are listed in the Index to Consolidated Financial Statements[194].