CHICAGO, April 26 /PRNewswire/ -- Chicago Title Corporation (NYSE: CTZ), a
leading provider of title insurance and real estate-related services, today
announced record first quarter earnings for the three months ended March 31,
1999. Net income from continuing operations for the period was $23.2 million,
or $1.06 per share on both a basic and diluted basis. This represents a 9.2
percent increase over net income from continuing operations of $21.2 million,
or $0.97 per share on both a basic and diluted basis, for the same period in
1998. For the first quarter, total revenue was $489.5 million compared to
$401.0 million in the prior year period.
John Rau, president and chief executive officer, stated, "Robust
residential resale markets, in what is normally a seasonally slow period,
provided us the opportunity to exceed last year's record first quarter
performance. While open order rates for residential refinancings have dropped
from the record levels seen late last year, they still remain well above
historical levels. Revenues from this market sector, along with commercial
business, remain quite strong."
In June 1998, Chicago Title was spun off from Alleghany Corporation
(NYSE: Y) and became an independent, publicly traded company. Prior to the
spin-off, Chicago Title performed trust and asset management services through
a subsidiary, Alleghany Asset Management, Inc. This subsidiary remained with
Alleghany after the spin-off. Accordingly, the results of operation of this
subsidiary are reported in Chicago Title's statements of income as
discontinued operations. As a result of the spin-off, Alleghany Asset
Management made no contribution to first quarter 1999 results. Net income
from discontinued operations was $5.0 million, or $0.23 per basic and diluted
share, in the first quarter of 1998.
Rau commented further, "With four acquisitions to date this year, we
continued to execute our strategy of increasing our direct presence in high
growth markets and expanding our array of real estate-related product
offerings. We moved into a market-leading position in Phoenix, expanded our
distribution channels in Virginia and Washington state, and acquired a home
warranty business in California. These acquisitions totaled $43 million and
were funded through internally generated cash flow."
In March 1999, Chicago Title announced a program to repurchase up to 5
percent of its outstanding stock, or 1.1 million shares, over the next two
years. As of March 31, 1999, the company had acquired 112,300 shares under
this program. Chicago Title's stockholders' equity per share was $21.43 as of
March 31, 1999.
Chicago Title Corporation is a leading national real estate services
company that provides a full range of services required to complete real
estate transactions. With over 340 full service offices, 10,000 employees and
4,100 policy-issuing agents nationwide, it provides title insurance, escrow,
closing services, property valuation, credit reporting, flood compliance, home
warranty, default management and real estate information and technology
services. Chicago Title is the parent of Chicago Title and Trust Company,
whose subsidiaries include Chicago Title Insurance Company, Ticor Title
Insurance Company and Security Union Title Insurance Company. A comprehensive
package of real estate services is available through CastleLink(SM), which
delivers title products as well as the products of Chicago Title Flood
Services Inc., Chicago Title Credit Services Inc., Chicago Title-Market
Intelligence Inc., Chicago Title Field Services Inc. and Consolidated
Reconveyance.
The statements made in this press release contain certain forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Act of 1934 that involve a number of
uncertainties and risks that could significantly affect current plans and
anticipated actions and Chicago Title's future financial condition and
results. In addition to the matters described in this press release, risk
factors listed from time to time in Chicago Title's reports and filings with
the Securities and Exchange Commission, including the Information Statement
included in its Registration Statement on Form 10 (File No. 1-13995) and
furnished to the stockholders of Chicago Title's former parent Alleghany
Corporation in connection with the spin-off of Chicago Title by Alleghany, may
affect the results achieved by Chicago Title.
Chicago Title Corporation and Subsidiaries
Financial Summary
(dollars in thousands, except per share data)
Three Months Ended
3/31/99 3/31/98
REVENUE
Title, escrow, trust and other revenue $471,810 $385,804
Investment income 16,607 14,805
Net realized investment gains-other 1,034 371
Total revenue 489,451 400,980
EXPENSES
Salaries and other employee benefits 153,533 127,603
Commissions paid to agents 172,196 131,490
Provision for title losses 29,817 26,279
Interest expense 1,079 1,295
Other operating and administrative
expenses(A) 97,686 82,273
Total expenses 454,311 368,940
Operating income from continuing
operations before income taxes 35,140 32,040
Income taxes 11,951 10,799
Net income from continuing operations 23,189 21,241
Net income from discontinued operations(B) -- 4,979
Net income $23,189 $26,220
Basic and diluted earnings per share
Continuing operations $1.06 $0.97
Discontinued operations(B) -- 0.23
Net income $1.06 $1.20
Impact of spin-off costs
Net income from continuing operations $23,189 $21,241
Spin-off costs, net of tax -- 367
Net income from continuing
operations, excluding spin-off costs $23,189 $21,608
Basic and diluted earnings per share
Net income from continuing operations $1.06 $0.97
Spin-off costs, net of tax -- 0.01
Net income from continuing
operations, excluding
spin-off costs $1.06 $0.98
Weighted average shares
outstanding (000's) 21,885 21,907
Chicago Title Corporation and Subsidiaries
Financial Summary (Continued)
(dollars in thousands, except per share data)
Three Months Ended
3/31/99 3/31/98
Other Data
Depreciation and amortization $12,715 $8,314
Claims paid, net of recoveries 17,392 21,222
Selected Balance Sheet Information 3/31/99 12/31/98
Total assets $1,909,706 $1,881,759
Notes payable and other obligations 21,467 21,648
Reserve for title losses 631,190 618,831
Total stockholders' equity 467,725 461,592
Stockholders' equity per share 21.43 21.07
(A) For the three months ended March 31, 1998, other operating and
administrative expenses included $565 thousand on a pretax basis for
professional fees, printing costs, listing fees and other expenses
directly associated with the spin-off.
(B) Results of Alleghany Asset Management are shown as discontinued
operations for all periods presented.
SOURCE Chicago Title Corporation
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Related links:
http://www.ctt.com
CONTACT:
Analysts, Toshie Y. Davis, Vice President,
Investor Relations, 312-223-4788, or Media, Barbara Harms, Vice
President, Corporate Communications, 312-223-2461, both of
Chicago Title Corporation
NOTE TO EDITORS: For further information on Chicago Title's
products and services, visit our web site at http://www.ctt.com.
For more information on Chicago Title Corporation via fax, free
of charge, dial 1-800- PRO-INFO and enter the ticker "CTZ"
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