Old Republic 4Q Profit Falls 81 Percent
|January 24, 2008|
CHICAGO (AP) -- Mortgage insurer Old Republic International Corp. on Thursday said its fourth-quarter earnings fell nearly 81 percent on losses in both its mortgage guaranty and title insurance businesses, but the results met Wall Street expectations.
The company reported net income of $20.2 million, or 9 cents per share, compared with $104.6 million, or 45 cents per share, during the same quarter a year ago.
Analysts polled by Thomson Financial expected a profit of 9 cents per share.
Old Republic reported a $112.6 million quarterly pretax loss in its mortgage guaranty business, compared with earnings of $46.4 million in the year-ago period. The composite ratio, which measures the amount of expenses and claims an insurer pays out compared to underwriting premiums, rose to 194.6 from 76 in the year-ago period. A ratio above 100 means the insurer paid out more in claims and expenses than it generated underwriting insurance.
The ongoing national housing slump, marked by higher mortgage foreclosures, loan defaults and inflated inventories of unsold homes, mitigated Old Republic's chances of limiting the lossciated Presses, the company said.
The company also reported a $15.7 million quarterly pretax loss in its title insurance business, compared with earnings of $300,000 in the year-ago period.
For 2007, Old Republic reported net income of $272.4 million, or $1.17 per share, compared with $464.8 million, or $1.99 per share, in 2006.
Shares of Old Republic fell 32 cents to $13.69 in morning trading.
Copyright 2008 Associated Press