UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934
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August
5, 2015
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Date
of Report (Date of earliest event reported)
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INVESTORS
TITLE COMPANY
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(Exact
name of Registrant as specified in its charter)
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North Carolina
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0-11774
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56-1110199
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(State or Other Jurisdiction of
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(Commission
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(I.R.S. Employer
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Incorporation or Organization)
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File Number)
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Identification No.)
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121 North Columbia Street
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Chapel Hill, North Carolina
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27514
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(Address of Principal Executive Offices)
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(Zip Code)
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(919) 968-2200
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Registrant's telephone number, including area code
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Check the
appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any
of the following provisions:
⃞
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
⃞
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
⃞
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
⃞
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition
Attached as Exhibit 99.1 and incorporated herein by reference is a copy
of the press release of Investors Title Company, dated August 5, 2015,
reporting Investors Title Company's financial results for the fiscal
quarter ended June 30, 2015.
The information in this Current Report is being furnished and shall not
be deemed "filed" for the purposes of Section 18 of the Securities
Exchange Act of 1934 (the "Exchange Act"), or otherwise subject to the
liabilities of that Section, nor shall it be deemed to be incorporated
by reference in any filing under the Securities Act of 1933 or the
Exchange Act, regardless of any general incorporation language in such
filing.
Item 9.01. Financial Statements and Exhibits
(c) Exhibits. The following exhibit accompanies this Report:
Exhibit 99.1 – Press Release of Investors Title Company dated August 5,
2015.
SIGNATURE
Pursuant to
the requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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INVESTORS TITLE COMPANY
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Date:
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August 5, 2015
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By:
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/s/ James A. Fine, Jr.
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James A. Fine, Jr.
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President, Treasurer and
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Chief Financial Officer
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EXHIBIT INDEX
Exhibit No.
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Description
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99.1
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Press release issued by Investors Title Company on August 5, 2015
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Exhibit 99.1
Investors
Title Company Announces Second Quarter 2015 Results
CHAPEL HILL, N.C.--(BUSINESS WIRE)--August 5, 2015--Investors Title
Company today announced its results for the second quarter ended June
30, 2015. Net income attributable to the Company increased 22.1% to
$4,120,497, or $2.05 per diluted share, compared with $3,373,598, or
$1.65 per diluted share, for the prior year quarter.
Revenues increased 6.8% to $35,481,807 versus the prior year quarter,
primarily due to net realized gains on investments and increases in
other revenues. Net premiums written also increased 2.1% to a quarterly
record level of $30,464,581, even as a greater share of our policy
volume originated in markets with lower average premium rates versus the
prior year quarter. Real estate activity was up significantly for the
quarter, driven by higher levels of home purchases and increases in
mortgage refinances versus the prior year quarter.
Operating expenses increased 4.0% to $29,695,310 versus the prior year
quarter, primarily due to an increase in the provision for claims,
stemming from recognition of favorable loss development in the prior
year. The increase in the provision for claims was partially offset by a
decrease in agent commissions, reflecting a higher proportion of
business written in markets with direct operations. Payroll expenses
were up 6.4% to $6,866,632 due to normal inflationary increases in
compensation and benefit costs, and higher staffing levels to support
ongoing software development activities.
For the six months ended June 30, 2015, net income attributable to the
Company increased 34.1% to $5,846,621, or $2.90 per diluted share,
compared with $4,360,036, or $2.14 per diluted share, for the prior year
period. Revenues increased 3.4% to $63,783,616 versus the prior year
period, while operating expenses were virtually flat at $55,627,995.
Results for the first half of the year have been shaped predominantly by
the same factors that affected the second quarter.
Chairman J. Allen Fine added, “Purchase activity improved substantially
for the first half of 2015 across all of our markets, driven partly by
an increase in the share of first-time buyers, as well as continuing
trends of increases in the rate of existing home sales and higher levels
of home prices. With positive trends in housing affordability,
unemployment, and overall economic conditions, we are optimistic that
recent levels of real estate activity will continue. Over the long term,
we remain focused on enhancing our competitive strengths and profitably
expanding our market presence.”
Investors Title Company’s subsidiaries issue and underwrite title
insurance policies. The Company also provides investment management
services to individuals, companies, banks and trusts, as well as
services in connection with tax-deferred exchanges of like-kind property.
Certain statements contained herein may constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Such statements include, among others, any
statements regarding future home price increases, changes in home
purchase or refinance activity, interest rate changes, expansion of the
Company’s market presence, enhancing competitive strengths, positive
developments in housing affordability, unemployment or overall economic
conditions or statements regarding our actuarial assumptions and the
application of recent historical claims experience to future periods.
These statements involve a number of risks and uncertainties that could
cause actual results to differ materially from anticipated and
historical results. Such risks and uncertainties include, without
limitation: the cyclical demand for title insurance due to changes in
the residential and commercial real estate markets; the occurrence of
fraud, defalcation or misconduct; variances between actual claims
experience and underwriting and reserving assumptions, including the
limited predictive power of historical claims experience; declines in
the performance of the Company’s investments; government regulation;
changes in the economy and other considerations set forth under the
caption “Risk Factors” in the Company’s Annual Report on Form 10-K for
the year ended December 31, 2014, as filed with the Securities and
Exchange Commission, and in subsequent filings.
Investors Title Company and Subsidiaries
Consolidated Statements of Income
For the Three and Six Months Ended June 30, 2015 and 2014
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Three Months Ended
June 30,
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Six Months Ended
June 30,
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2015
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2014
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2015
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2014
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Revenues:
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Net premiums written
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$
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30,464,581
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$
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29,849,853
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$
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55,426,622
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$
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54,759,105
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Investment income - interest and dividends
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1,131,487
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1,039,435
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2,309,526
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2,065,851
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Net realized gain on investments
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925,164
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92,082
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939,967
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584,219
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Other
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2,960,575
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2,240,183
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5,107,501
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4,266,452
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Total Revenues
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35,481,807
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33,221,553
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63,783,616
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61,675,627
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Operating Expenses:
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Commissions to agents
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16,898,691
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18,346,381
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31,495,230
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33,802,659
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Provision for claims
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2,130,810
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294,281
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2,917,422
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2,669,664
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Salaries, employee benefits and payroll taxes
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6,866,632
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6,454,930
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14,144,081
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12,640,691
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Office occupancy and operations
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1,443,297
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1,246,644
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2,747,518
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2,426,971
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Business development
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578,194
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511,763
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1,065,169
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1,029,657
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Filing fees, franchise and local taxes
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221,098
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225,343
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437,741
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414,943
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Premium and retaliatory taxes
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634,747
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546,091
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1,111,338
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840,565
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Professional and contract labor fees
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680,483
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666,909
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1,264,590
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1,354,967
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Other
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241,358
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250,167
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444,906
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459,951
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Total Operating Expenses
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29,695,310
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28,542,509
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55,627,995
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55,640,068
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Income before Income Taxes
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5,786,497
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4,679,044
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8,155,621
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6,035,559
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Provision for Income Taxes
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1,666,000
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1,281,000
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2,309,000
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1,652,000
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Net Income
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4,120,497
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3,398,044
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5,846,621
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4,383,559
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Net Income Attributable to Redeemable Noncontrolling Interest
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—
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(24,446
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—
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(23,523
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Net Income Attributable to the Company
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$
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4,120,497
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$
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3,373,598
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$
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5,846,621
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$
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4,360,036
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Basic Earnings per Common Share
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$
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2.06
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$
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1.66
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$
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2.91
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$
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2.14
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Weighted Average Shares Outstanding – Basic
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2,004,698
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2,034,931
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2,008,718
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2,036,047
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Diluted Earnings per Common Share
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$
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2.05
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$
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1.65
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$
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2.90
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$
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2.14
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Weighted Average Shares Outstanding – Diluted
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2,009,495
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2,039,202
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2,013,878
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2,041,268
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Investors Title Company and Subsidiaries
Consolidated Balance Sheets
As of June 30, 2015 and December 31, 2014
(Unaudited)
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June 30, 2015
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December 31, 2014
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Assets:
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Investments in securities:
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Fixed maturities, available-for-sale, at fair value
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$
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101,686,777
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$
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109,048,290
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Equity securities, available-for-sale, at fair value
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38,237,742
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39,254,981
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Short-term investments
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8,588,140
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2,576,993
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Other investments
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8,397,014
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8,530,929
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Total investments
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156,909,673
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159,411,193
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Cash and cash equivalents
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18,823,257
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15,826,515
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Premium and fees receivable
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9,380,604
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8,544,183
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Accrued interest and dividends
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1,039,031
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1,063,837
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Prepaid expenses and other assets
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7,925,283
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7,732,677
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Property, net
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6,121,707
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5,460,805
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Total Assets
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$
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200,199,555
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$
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198,039,210
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Liabilities and Stockholders’ Equity
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Liabilities:
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Reserves for claims
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$
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38,125,000
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$
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36,677,000
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Accounts payable and accrued liabilities
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16,900,157
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18,290,819
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Current income taxes payable
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423,908
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92,192
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Deferred income taxes, net
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5,091,797
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5,415,493
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Total liabilities
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60,540,862
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60,475,504
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Stockholders’ Equity:
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Common stock - no par value (10,000,000 authorized shares;
2,001,030 and 2,023,270
shares issued and outstanding 2015 and 2014, respectively,
excluding 291,676 shares for
2015 and 2014 of common stock held by the Company's subsidiary)
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1
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1
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Retained earnings
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128,634,895
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124,707,196
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Accumulated other comprehensive income
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11,023,797
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12,856,509
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Total stockholders’ equity
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139,658,693
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137,563,706
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Total Liabilities and Stockholders’ Equity
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$
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200,199,555
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$
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198,039,210
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Investors Title Company and Subsidiaries
Net Premiums Written By Branch and Agency
For the Three and Six Months Ended June 30, 2015 and 2014
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Three Months Ended June 30,
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Six Months Ended June 30,
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2015
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%
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2014
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%
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2015
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%
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2014
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%
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Branch
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$
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7,707,773
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25.3
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$
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6,275,362
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21.0
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$
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13,313,537
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24.0
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$
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11,107,041
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20.3
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Agency
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22,756,808
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74.7
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23,574,491
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79.0
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42,113,085
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76.0
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43,652,064
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79.7
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Total
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$
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30,464,581
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100.0
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$
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29,849,853
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100.0
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$
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55,426,622
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100.0
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$
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54,759,105
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100.0
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CONTACT:
Investors Title Company
Elizabeth B. Lewter, 919-968-2200
Investors Title (NASDAQ:ITIC)
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