Investors Title, which issues and underwrites title insurance policies, reported sharply lower net income in the first quarter as a result of higher expenses.
The Chapel Hill-based company announced Tuesday that first-quarter net income totaled $986,438, or 48 cents per share, down from $3.4 million a year ago.
First-quarter revenue was a record $28.5 million, up 6 percent. Increased premium volume and gains on investments contributed to the higher revenue.
Operating expenses rose 23 percent to $27.1 million. Higher provisions for claims and higher commissions to agents led the increase.
“As the overall economy has continued to improve, higher levels of real estate purchase activity and higher home prices across many of our markets helped drive an increase in premiums during the period,” the company noted. That was partially offset, however, by “a significant drop in refinance activity.”
Investors Title provides title insurance, which protects homeowners against losses arising from ownership disputes. Many lenders require homeowners to obtain title insurance, which makes the business somewhat dependent on the health of the housing market.
Investors Title also manages investments for individuals and businesses.
Investors Title shares closed Tuesday at $66.10, down 93 cents. The stock is down 18 percent this year.