Stewart Reports First Quarter 2025 Results

• Total revenues of $612.0 million ($608.9 million on an adjusted basis) compared to $554.3 million ($547.3 million on an adjusted basis) in the prior year quarter
• Net income of $3.1 million ($7.0 million on an adjusted basis) compared to net income of $3.1 million ($4.6 million on an adjusted basis) in the prior year quarter
• Diluted EPS of $0.11 ($0.25 on an adjusted basis) compared to prior year quarter diluted EPS of $0.11 ($0.17 on an adjusted basis)

HOUSTON, April 23, 2025 /PRNewswire/ -- Stewart Information Services Corporation (NYSE: STC) today reported net income attributable to Stewart of $3.1 million ($0.11 per diluted share) for the first quarter 2025, compared to net income attributable to Stewart of $3.1 million ($0.11 per diluted share) for the first quarter 2024. On an adjusted basis, net income for the first quarter 2025 was $7.0 million ($0.25 per diluted share) compared to net income of $4.6 million ($0.17 per diluted share) in the first quarter 2024. Pretax income before noncontrolling interests for the first quarter 2025 was $5.9 million ($11.2 million on an adjusted basis) compared to $7.1 million ($9.1 million on an adjusted basis) for the first quarter 2024.

First quarters 2025 and 2024 results included $3.1 million and $7.0 million, respectively, of total pretax net realized and unrealized gains, both primarily related to net gains from fair value changes of equity securities investments recorded in the title segment.

"I'm proud of our first quarter 2025 performance as we delivered strong revenue results across all our segments, growing our total revenues compared to the first quarter of last year," commented Fred Eppinger, chief executive officer. "We are pleased with our performance as we were able to deliver these results while navigating a historically challenging macro environment. We remain focused on managing our operations well, growing the company thoughtfully and relentlessly serving our customers." 

Selected Financial Information
Summary results of operations are as follows (dollars in millions, except per share amounts, pretax margin and adjusted pretax margin, and amounts may not add as presented due to rounding):

Title Segment
Summary results of the title segment are as follows (dollars in millions, except pretax margin and adjusted pretax margin):

Title segment operating revenues in the first quarter 2025 increased $47.8 million (11 percent), as revenues from both our direct and agency title operations improved, while total segment operating expenses increased $41.9 million (9 percent) compared to the first quarter 2024. Agency retention expenses in the first quarter 2025 increased $21.4 million (11 percent), consistent with the gross agency revenue increase of $26.7 million (11 percent) compared to the prior year quarter.

Title segment combined employee costs and other operating expenses for the first quarter 2025 increased $20.3 million (9 percent), compared to the first quarter 2024, primarily due to increased incentive compensation expenses related to higher title revenues, and higher outside search and service expenses resulting from higher commercial revenues. As a percentage of operating revenues, total title employee costs and other operating expenses improved to 51.1 percent in the first quarter 2025 compared to 52.0 percent in the prior year quarter.

Title loss expense in the first quarter 2025 was $17.7 million compared to $17.4 million in the first quarter 2024. As a percentage of title operating revenues, first quarter 2025 title loss expense improved to 3.5 percent, compared to 3.9 percent in the prior year quarter, primarily driven by our overall favorable claims experience. In addition to the net realized and unrealized gains presented above (which were primarily related to fair value changes of equity securities investments), non-GAAP adjustments to the title segment's pretax income for the first quarters 2025 and 2024 of $2.8 million and $3.4 million, respectively, were primarily related to acquisition intangible asset amortization and related expenses (refer to Appendix A for details).

Direct title revenues information is presented below (dollars in millions):

Domestic commercial revenues in the first quarter 2025 improved $19.6 million (39 percent), driven by a 13 percent higher average transaction size and a 23 percent increase in commercial closed transactions compared to the prior year quarter. Domestic non-commercial revenues in the first quarter 2025 were slightly lower compared to the prior year quarter, primarily due to lower total non-commercial domestic transactions, partially offset by a 13 percent higher fee per file during first quarter 2025. First quarter 2025 average domestic commercial fee per file was $15,800, compared to $13,900 from the first quarter 2024, while average domestic residential fee per file was $3,300, compared to $2,900 from the prior year quarter. Total international revenues improved $2.4 million (9 percent) in the first quarter 2025, primarily driven by increased volumes from our Canadian operations compared to the prior year quarter.

Real Estate Solutions Segment
Summary results of the real estate solutions segment are as follows (dollars in millions, except pretax margin and adjusted pretax margin):

Segment operating revenues improved $14.1 million (17 percent) in the first quarter 2025, primarily driven by increased revenues from our credit information services operations compared to the first quarter 2024. Combined employee costs and other operating expenses increased $16.6 million (24 percent), primarily due to higher costs of services related to credit information and increased employee costs supporting revenue growth. Non-GAAP adjustments to pretax income shown in the schedule above were related to acquisition intangible asset amortization expenses (refer to Appendix A).

Corporate Segment
The segment's results primarily relate to net expenses attributable to corporate operations which totaled $9.9 million in the first quarter 2025, compared to $9.7 million in the prior year quarter.

Expenses
Consolidated employee costs in the first quarter 2025 increased $13.4 million (8 percent) compared to the first quarter 2024, primarily due to higher incentive compensation on overall improved revenues and increased salaries primarily due to slightly higher employee counts in our title and real estate solutions businesses. As a percentage of total operating revenues, consolidated employee costs in the first quarter 2025 improved to 31.2 percent from 32.3 percent in the prior year quarter.

Consolidated other operating expenses in the first quarter 2025 increased $24.0 million (18 percent), primarily due to higher real estate solutions service expenses and commercial title outside search fees driven by higher related revenues compared to the first quarter 2024. As a percentage of total operating revenues, first quarter 2025 consolidated other operating expenses increased to 27.0 percent compared to 25.6 percent from the prior year quarter, primarily due to increased real estate solutions service expenses.

Other
Net cash used by operations in the first quarter 2025 was $29.9 million, which was comparable to net cash used of $29.6 million in the first quarter 2024. 

First Quarter Earnings Call
Stewart will hold a conference call to discuss the first quarter 2025 earnings at 8:30 a.m. Eastern Time on Thursday, April 24, 2025. To participate, dial 800-267-6316 (USA) or 203-518-9783 (International) – access code STCQ125. Additionally, participants can listen to the conference call through Stewart's Investor Relations website at https://investors.stewart.com/news-and-events/events/default.aspx. The conference call replay will be available from 11:00 a.m. Eastern Time on April 24, 2025 until midnight on May 1, 2025 by dialing (800) 938-0998 (USA) or (402) 220-1550 (International).

About Stewart
Stewart (NYSE-STC) is a global real estate services company, offering products and services through our direct operations, network of Stewart Trusted Providers™ and family of companies. From residential and commercial title insurance and closing and settlement services to specialized offerings for the mortgage and real estate industries, we offer the comprehensive service, deep expertise and solutions our customers need for any real estate transaction. At Stewart, we are dedicated to becoming the premier title services company and we are committed to doing so by partnering with our customers to create mutual success. Learn more at stewart.com.

Cautionary statement regarding forward-looking statements. Certain statements in this press release are "forward-looking statements", including statements related to Stewart's future business plans and expectations, including our plans to achieve market growth and pretax margin improvements. Forward-looking statements, by their nature, are subject to various risks and uncertainties that could cause our actual results to differ materially. Such risks and uncertainties include the volatility of general economic conditions, including economic changes that may result from new or increased tariffs, trade restrictions or geopolitical tensions, and adverse changes in the level of real estate activity, as well as a number of other risk and uncertainties discussed in detail in our documents filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2024, and if applicable, as supplemented by any risk factors contained in our Quarterly Reports on Form 10-Q, and our Current Reports on Form 8-K filed subsequently. We expressly disclaim any obligation to update, amend or clarify any forward-looking statements contained in this press release to reflect events or circumstances that may arise after the date hereof, except as may be required by applicable law.

ST-IR

Appendix A
Non-GAAP Adjustments

Management uses a variety of financial and operational measurements other than its financial statements prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) to analyze its performance. These include: (1) adjusted revenues, which are reported revenues adjusted for net realized and unrealized gains and losses and (2) adjusted pretax income and adjusted net income, which are reported pretax income and reported net income after earnings from noncontrolling interests, respectively, adjusted for net realized and unrealized gains and losses, acquisition intangible asset amortization and other expenses (acquisition-related), and office closure costs and severance expenses. Adjusted diluted earnings per share (adjusted diluted EPS) is calculated using adjusted net income divided by the diluted average weighted outstanding shares. Adjusted pretax margin is calculated using adjusted pretax income divided by adjusted total revenues. Management views these measures as important performance measures of core profitability for its operations and as key components of its internal financial reporting. Management believes investors benefit from having access to the same financial measures that management uses.

Below are reconciliations of the non-GAAP financial measures used by management to the most directly comparable GAAP measures for the quarter ended March 31, 2025 and 2024 (dollars in millions, except shares, per share amounts and pretax margins, and amounts may not add as presented due to rounding).

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SOURCE Stewart Information Services Corporation