The First American Corporation Reports Operating Results for the First Quarter 2002
April 25, 2002
Segment Data Expanded to Highlight Diversification -
SANTA ANA, Calif., April 25 /PRNewswire-FirstCall/ -- The First American Corporation (NYSE: FAF - news), one of the nation's leading, diversified provider of business information and related products and services, announced today operating results for the first quarter ended March 31, 2002.
Net income for the first quarter 2002 was $44.1 million, the highest first quarter net income in the company's history, or 57 cents per diluted share. This represents a 114 percent increase when compared with 2001 first quarter net income of $20.6 million, or 30 cents per diluted share, which excludes a previously announced one-time item. Revenues for the first three months of 2002 totaled $1.04 billion, also a first-quarter record, representing an increase of 36 percent when compared with 2001 first quarter revenues of $766.7 million.
"We are extremely pleased with our first quarter results," stated Parker S. Kennedy, president of The First American Corporation. "While processing and closing near record order counts, we were able to exercise solid expense controls and significantly improve our margins when compared with the first quarter of 2001.
"Refinance-related orders in our real estate-oriented businesses have declined but are still above normal levels. Orders relating to new home sales and resale activity remain at seasonally high levels, and new title order counts for the first quarter of 2002 were at record first-quarter levels."
In order to provide expanded financial information that more accurately reflects the diversity of First American, beginning in the first quarter of 2002, the company established seven reporting segments. These reporting segments fall within two primary business groups, Financial Services and Information Technology. The Financial Services Group includes Title Insurance and Services, Specialty Insurance, and Trust and Other Services; and the Information Technology Group includes Mortgage Information, Property Information, Credit Information and Screening Information. The company's previous reporting segments included Title Insurance, Real Estate Information and Consumer Information. A five-year historical summary of the new reporting segments is included as part of this release.
"This expanded information reveals the character and quality of our earnings and helps differentiate First American from other title insurance companies," Kennedy added. "The new segments will enable investors to value First American business by business and should unlock shareholder value and deliver a higher earnings multiple.
"In the future, First American will stand out as an information technology company leveraging its databases and technology to deliver information and other products and services to a wide array of customers. As a result of technology solutions, title insurance, the company's primary business, will in time produce increased margins closer to our information technology businesses and First American will enjoy a higher valuation in the years to come."
Source: The First American Corporation