Earnings Per Share Exceed Analysts' Estimates
CHICAGO, Oct. 19 /PRNewswire/ -- Chicago Title Corporation (NYSE: CTZ), a
leading provider of title insurance and real estate-related services, today
announced revenues and earnings for the third quarter and nine months ended
September 30, 1999.
Net income was $28.3 million or $1.30 per basic and diluted share in the
third quarter of 1999, when expenses associated with its pending merger with
Fidelity National Financial, Inc. (NYSE: FNF) are excluded. Total revenues
for the third quarter of 1999 were $522.0 million, a 5.0 percent increase from
the third quarter of 1998. Net income during the third quarter of 1998 was
$29.9 million or $1.37 per basic and diluted share.
For the nine months ended September 30, 1999, net income, excluding
merger-related costs, was $81.5 million or $3.74 per basic and diluted share.
During the same period in 1998, net income from continuing operations reached
$83.4 million or $3.81 per basic and diluted share excluding costs associated
with the Company's spin-off in June 1998. Total revenues for the nine months
ended September 30, 1999 were $1,539.7 million, an 11.9 percent increase from
the same period last year.
John Rau, president and chief executive officer, stated, "As a result of
our diversified revenue base, we continued to achieve strong operating results
in the third quarter. Solid performance in our commercial and residential
purchase sectors allowed us to weather the decline in residential refinance
transactions. Our strong revenue base, coupled with active cost containment,
helped us exceed the consensus market forecast of $1.28 per share in the
quarter."
Net income, including merger-related costs, was $25.2 million or $1.16 per
basic and diluted share in the third quarter of 1999. For the nine months
ended September 30, 1999, net income, including merger-related costs, was
$78.5 million or $3.60 per basic and diluted share.
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 operations for this
subsidiary in 1998 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 1999 results. For the nine months ended
September 30, 1998, net income from discontinued operations was $9.0 million,
or $0.41 per basic and diluted share.
Rau commented further, "We remain on track to consummate our merger with
Fidelity National Financial, Inc. during the first quarter of 2000. Our
management team is working closely with Fidelity to develop a detailed plan to
integrate the two companies. The combination of Chicago Title with Fidelity
will create the leading player in the title insurance industry and we are
confident that the benefits of the merger will quickly become visible to the
marketplace."
At September 30, 1999, total assets were $2.0 billion and stockholders'
equity per share was $22.73.
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
4,300 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,
Chicago Title Insurance Company, Security Union Title Insurance Company and
Ticor 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 may affect the results achieved by
Chicago Title.
For more information on Chicago Title Corporation via fax, free of charge,
dial 1-800-PRO-INFO and enter the ticker "CTZ"
Chicago Title Corporation and Subsidiaries
Quarterly Financial Summary
(dollars in thousands, except per share data)
Unaudited
Three Months Ended Nine Months Ended
9/30/1999 9/30/1998 9/30/1999 9/30/1998
REVENUE
Title, escrow, trust
and other revenue $504,632 $481,326 $1,489,468 $1,328,887
Investment income 17,311 15,563 48,988 46,116
Net realized investment
gains 12 199 1,261 737
Total revenue 521,955 497,088 1,539,717 1,375,740
EXPENSES
Salaries and
other employee
benefits (A) 160,668 157,618 475,679 452,242
Commissions paid
to agents 180,947 170,450 533,090 455,683
Provision for title
losses 28,229 31,904 89,722 88,650
Interest expense 1,118 1,147 3,147 3,552
Other operating
and administrative
expenses (B, D) 110,976 89,670 317,591 276,053
Total expenses 481,938 450,789 1,419,229 1,276,180
Operating income
from continuing
operations before
income taxes 40,017 46,299 120,488 99,560
Income taxes 14,814 16,393 42,034 37,710
Net income
from continuing operations 25,203 29,906 78,454 61,850
Net income from
discontinued operations (C) -- -- -- 9,013
Net income $25,203 $29,906 $78,454 $70,863
Basic and diluted
earnings per share
Continuing operations $1.16 $1.37 $3.60 $2.83
Discontinued operations (C) -- -- -- 0.41
Net income $1.16 $1.37 $3.60 $3.24
Impact of spin-off
and merger related costs
Net income from
continuing operations $25,203 $29,906 $78,454 $61,850
Spin-off costs,
net of tax (A,B) -- -- -- 21,563
Merger costs,
net of tax (D) 3,091 -- 3,091 --
Net income from
continuing operations,
excluding merger
and spin-off costs $28,294 $29,906 $81,545 $83,413
Basic and diluted
earnings per share
Net income from
continuing operations $1.16 $1.37 $3.60 $2.83
Spin-off costs,
net of tax (A,B) -- -- -- 0.98
Merger costs,
net of tax (D) 0.14 -- 0.14 --
Net income from
continuing operations,
excluding merger
and spin-off costs $1.30 $1.37 $3.74 $3.81
Weighted average shares
outstanding (000's) 21,816 21,895 21,828 21,903
Other data
Depreciation
and amortization $13,447 $11,610 $40,665 $28,545
Claims paid,
net of recoveries 18,544 13,562 52,167 50,626
Selected balance
sheet information 9/30/1999 12/31/1998
Total assets $2,017,869 $1,881,759
Bank and other
long term debt 21,437 21,648
Reserve
for title losses 656,220 618,831
Total stockholders'
equity 496,240 461,592
Stockholders' equity
per share 22.73 21.07
(A) For the nine months ended September 30, 1998, salaries and other
employee benefits included $19.5 million in direct costs associated
with the spin-off for executive compensation and $3.7 million in
related managerial restructuring expenses.Both amounts are shown on a
pre-tax basis.
(B) For the nine months ended September 30, 1998, other operating and
administrative expenses included $5.4 million on a pre-tax basis for
professional fees, printing costs, listing fees and other expenses
directly associated with the spin-off.
(C)Results of Alleghany Asset Management are shown as discontinued
operations for all periods presented.
(D)Chicago Title entered into a definitive agreement with Fidelity
National, Inc., dated as of August 1, 1999 and amended as of October
13, 1999, providing for the merger of Chicago Title into Fidelity for
approximately $1.2 billion, or $52.00 per share of Chicago Title
common stock (subject to certain adjustments as set forth in the
definitive agreement) using approximately equal amounts of cash and
stock. The pre-tax costs associated with the merger include $1.7
million of investment advisory and management consulting fees, $0.9
million of legal fees and $0.6 million of other various direct
expenses, and are all included in other operating and administrative
expenses.
SOURCE Chicago Title Corporation
 back to top
Related links:
http://www.ctt.com
CONTACT:
Analysts, Toshie Y. Davis, Vice President,
Investor Relations, 312-223-4788, or Media, Barbara Harms, Vice
President or 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 side at http://www.ctt.com .
|
