The First American Financial Corporation reports record level net income and ...


May 13, 1987, SANTA ANA, CALIFORNIA

The First American Financial Corporation (NASDAQ:FAMR) reported Wednesday that net income and revenue for the first quarter 1987, excluding a non-recurring income tax benefit of $8,996,000, exceeded that of any previous first quarter in the company's history. Net income, excluding the tax benefit, amounted to $2,850,000, or $1.03 per share. This amount more than doubled the $1,313,000, or $.52 per share, earned during the same period in 1986.

D.P. Kennedy, president, attributed this record performance to "low interest rates and the continuing effects of the Tax Reform Act which combined to maintain a high level of real estate activity."

Kennedy reported further that net income, including a one-time transitional income tax benefit of $8,996,000, or $3.24 per share, amounted to $11,846,000, or $4.27 per share. This special tax benefit resulted from the discounting of unearned premium reserves and case basis loss reserves in accordance with the "fresh start" provisions of the new Tax Act.

The First American Financial Corporation, based in Santa Ana, California, operates its title insurance business through its principal subsidiary, First American Title Insurance Company. The firm offers title services through a network of more than 2,500 offices or agents in all 50 states. It also provides title services abroad in Guam, Mexico, Puerto Rico, the Virgin Islands and England.

Synopsis:

Three months ended March 31:		1987		1986
Revenue				    $ 89,891,000    $ 65,435,000
Net Income			    $ 11,846,000    $  1,313,000
Net income per share		    $       4.27    $        .52
Average shares outstanding	       2,773,000       2,545,000

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