LandAmerica Announces Fourth Quarter& Year 2003 Results
February 19, 2004
LandAmerica Financial Group, Inc. (NYSE: LFG), a provider of real estate transaction services, reported operating results for the fourth quarter and year 2003 ended December 31.
Fourth Quarter 2003
Operating Revenue $924.3 Million
Net income $24.7 Million
Net income per diluted share $1.32
Fourth Quarter 2002
Operating Revenue $762.9 Million
Net income $66.3 Million
Net income per diluted share $3.61
Operating Revenue $3,345.4 Million
Net income $192.1 Million
Net income per diluted share $10.31
Operating income $2,533.5 Million
Net income $149.4 Million
Net income per diluted share $8.04
- The year 2003 was a record for the Company with operating revenue exceeding $3.3 billion and earnings per share in excess of $10.
- Revenues for the fourth quarter of 2003 were $924.3 million with strength in agency revenues and the addition of tax, flood, and credit reporting revenues, partially offset by a decline in direct title revenues.
- Revenues for the Lender Services segment is net of $5.8 million in revenue deferrals for the fourth quarter of 2003.
- Earnings for the fourth quarter declined by 63% over the fourth quarter of 2002, reflecting the impact of a number of factors, including but not limited to, the effect on our direct operations of the rapid decline in mortgage activity from prior periods; the incurrence of $6.2 million in one-time charges associated with severance, lease terminations, and reductions in title plant evaluations; $4.4 million in amortization of intangibles associated with recent acquisitions; and an increase in the loss provision rate.
- The Company has expanded its disclosures in the income statement to better reflect the expansion of the Company's operations in the Lender Services segment with the acquisitions of LERETA and Info1 in 2003. Title Operations consists of title, escrow, and closely related business. Lender Services consists primarily of real estate tax monitoring and payment, flood certification, mortgage credit reporting, and default management services. Corporate and Other represents business segments that are not significant enough in size to be reported separately and consists of residential home inspection, commercial appraisals and assessments, and the industrial bank the Company acquired in 2003, as well as the unallocated portion of corporate expenses.
?For LandAmerica, it was a record year and a building year,? said Charles H. Foster, Jr., Chairman and Chief Executive Officer. ?We significantly expanded our offering of real estate products and services with the additions of LERETA's tax and flood services and Info1's mortgage credit reporting services. We also are significantly expanding our title operations in the important California market with the addition of Gateway Title in the fourth quarter and our recent announcement of an agreement to acquire Southland Title.
?While we pursued these market expansion opportunities and began to assimilate them into our business, we also were transitioning to a mortgage market with significantly reduced residential refinancing volumes. The Mortgage Bankers Association expects mortgage volumes for 2004 to be slightly more than half the levels seen in 2003, as driven by the decline in refinancings. From peak levels in August, we reduced our FTE count in title operations by approximately 1,600, or over 15%, by January. As a result, personnel and other costs in title operations were reduced by approximately $21.2 million from the third quarter to the fourth quarter 2003, and we aren't finished. We are taking aggressive steps to effect further reductions designed to eliminate at least $70 million in annualized personnel and other costs.