v3.26.1
Note 7 - Segment Information
6 Months Ended
Jun. 30, 2026
Notes to Financial Statements  
Segment Reporting [Text Block]

7.

Segment Information

 

The Company has two reportable segments: (i) Title Insurance and (ii) Corporate and Other. This presentation of reportable segments is aligned with the manner in which the Company's chief operating decision maker, Steven A. Hale II, Chief Executive Officer, monitors the performance of the Company's operations. The measure of the Company's segment performance is income (loss) before income taxes. 

 

Title Insurance 

 

Our title insurance segment issues title insurance policies and provides title agency services on residential and commercial real estate transactions. This segment also provides closing and/or escrow services to facilitate real estate transactions.

 

Corporate and Other 

 

Activity in the Corporate and Other segment primarily consists of management advisory services that the Company performs through its Services Agreement with HP Risk. Pursuant to this agreement, the Company provides certain managerial and operational services that include, but are not limited to: reinsurance brokerage services; the review and improvement of financial goals; compliance with legal and regulatory mandates; maintenance of an ethical business environment; investment and asset manager compliance; cash and equity management; corporate tax management; personnel management; related party transaction oversight; tax preparation administration; strategic capital modeling; the review of potential acquisitions and transactions involving affiliates and third parties, including but not limited to, renewal rights deals, loss portfolio transfers or entity acquisitions; execution of (or provision for the execution of) all general corporate legal matters; and provision of internal control management services.

 

The Corporate and Other segment also includes results of the Company's investment in a related party - HC Realty. HC Realty is an internally-managed REIT focused on acquiring, financing, owning and managing build-to-suit or renovate-to-suit, single-tenant properties leased primarily to the U.S. government and administered by the U.S. General Services Administration or directly by the federal government agencies or sub-agencies occupying such properties. As of June 30, 2026, the Company owns approximately 28.0% of the voting interest of HC Realty.

 

Provided below is selected financial information about the Company’s operations by segment for the three months ended June 30, 2026 (in thousands):

 

  

Title

  

Corporate

     
  

Insurance

  

and Other

  

Total

 

Revenues:

            

Net premium written

 $2,101  $-  $2,101 

Escrow and other title fees

  854   -   854 

Management fees from related parties

  -   1,500   1,500 

Total revenues

  2,955   1,500   4,455 
             

Cost of revenues:

            

Underwriting expenses

  (87)  -   (87)

Provision for title claim losses

  (46)  -   (46)

Search and other fees

  (40)  -   (40)

Total cost of revenues

  (173)  -   (173)
             

Gross profit

  2,782   1,500   4,282 
             

Operating expenses:

            

Personnel costs

  (1,783)  (334)  (2,117)

Other operating expense (1)

  (919)  (233)  (1,152)

Amortization and depreciation

  (23)  -   (23)

Total operating expense

  (2,725)  (567)  (3,292)

Other income, net

  84   279   363 

Income before income taxes

 $141  $1,212  $1,353 
             

Goodwill and intangible assets, net (2)

 $6,573  $-  $6,573 
 (1)Other operating expense primarily consists of rent and other occupancy expenses, software and equipment expense, corporate insurance and other regulatory and professional fees.
 

(2)

The Company does not allocate its assets by segment, with the exception of Goodwill and Intangible assets.

 

Provided below is selected financial information about the Company’s operations by segment for the three months ended June 30, 2025 (in thousands):

 

  

Title

  

Corporate

     
  

Insurance

  

and Other

  

Total

 

Revenues:

            

Net premium written

 $1,998  $-  $1,998 

Escrow and other title fees

  812   -   812 

Management fees from related parties

  -   1,250   1,250 

Total revenues

  2,810   1,250   4,060 
             

Cost of revenues:

            

Underwriting expenses

  (43)  -   (43)

Provision for title claim losses

  (85)  -   (85)

Search and other fees

  (29)  -   (29)

Total cost of revenues

  (157)  -   (157)
             

Gross profit

  2,653   1,250   3,903 
             

Operating expenses:

            

Personnel costs

  (1,704)  (397)  (2,101)

Other operating expense (1)

  (850)  (345)  (1,195)

Amortization and depreciation

  (25)  -   (25)

Total operating expense

  (2,579)  (742)  (3,321)

Other income, net

  76   290   366 

Income before income taxes

 $150  $798  $948 
             

Goodwill and intangible assets, net (2)

 $6,647  $-  $6,647 
 (1)Other operating expense primarily consists of rent and other occupancy expenses, software and equipment expense, corporate insurance and other regulatory and professional fees.
 

(2)

The Company does not allocate its assets by segment, with the exception of Goodwill and Intangible assets.

 

Provided below is selected financial information about the Company’s operations by segment for the six months ended  June 30, 2026 (in thousands):

 

  

Title

  

Corporate

     
  

Insurance

  

and Other

  

Total

 

Revenues:

            

Net premium written

 $3,679  $-  $3,679 

Escrow and other title fees

  1,592   -   1,592 

Management fees from related parties

  -   3,000   3,000 

Total revenues

  5,271   3,000   8,271 
             

Cost of revenues:

            

Underwriting expenses

  (144)  -   (144)

Provision for title claim losses

  (101)  -   (101)

Search and other fees

  (68)  -   (68)

Total cost of revenues

  (313)  -   (313)
             

Gross profit

  4,958   3,000   7,958 
             

Operating expenses:

            

Personnel costs

  (3,347)  (825)  (4,172)

Other operating expense (1)

  (1,809)  (524)  (2,333)

Amortization and depreciation

  (47)  -   (47)

Total operating expense

  (5,203)  (1,349)  (6,552)

Other income, net

  167   579   746 

(Loss) income before income taxes

 $(78) $2,230  $2,152 
             

Goodwill and intangible assets, net (2)

 $6,573  $-  $6,573 
 (1)Other operating expense primarily consists of rent and other occupancy expenses, software and equipment expense, corporate insurance and other regulatory and professional fees.
 

(2)

The Company does not allocate its assets by segment, with the exception of Goodwill and Intangible assets.

   

Provided below is selected financial information about the Company’s operations by segment for the six months ended  June 30, 2025 (in thousands):

 

  

Title

  

Corporate

     
  

Insurance

  

and Other

  

Total

 

Revenues:

            

Net premium written

 $3,386  $-  $3,386 

Escrow and other title fees

  1,396   -   1,396 

Management fees from related parties

  -   2,000   2,000 

Total revenues

  4,782   2,000   6,782 
             

Cost of revenues:

            

Underwriting expenses

  (99)  -   (99)

Provision for title claim losses

  (102)  -   (102)

Search and other fees

  (56)  -   (56)

Total cost of revenues

  (257)  -   (257)
             

Gross profit

  4,525   2,000   6,525 
             

Operating expenses:

            

Personnel costs

  (3,339)  (755)  (4,094)

Other operating expense (1)

  (1,668)  (680)  (2,348)

Amortization and depreciation

  (50)  -   (50)

Total operating expense

  (5,057)  (1,435)  (6,492)

Other income, net

  139   496   635 

(Loss) income before income taxes

 $(393) $1,061  $668 
             

Goodwill and intangible assets, net (2)

 $6,647  $-  $6,647 
 (1)Other operating expense primarily consists of rent and other occupancy expenses, software and equipment expense, corporate insurance and other regulatory and professional fees.
 

(2)

The Company does not allocate its assets by segment, with the exception of Goodwill and Intangible assets.