The First American Financial Corporation reports a profitable first quarter of 1990
May 10, 1990, SANTA ANA, CALIFORNIA
For the three months ended March 31, 1990, First American Financial had net income of $852,000, or 9 cents a share. This compares with a 1989 first quarter loss of $1,263,000, or 13 cents a share and a loss of $3,176,000, or 33 cents a share for the first quarter of 1988.
Revenues for the current quarter were $163,633,000, down slightly from revenues of $165,290,000 for the same period in 1989.
"Real estate activity in the Western United States continued at a relatively high level," Donald P. Kennedy, president of First American Financial, said, "although the California market is showing evidence of softening in commercial, resale and new housing areas. Arizona appears to have reached bottom and there is some evidence of improvement in that economy. The Northeastern area continues to be in a depressed condition, while the Northwest is experiencing a high level of activity. Operations in the Midwest showed improvement over last year."
"New orders and closings for title insurance policies in general were continuing their upward trend in the quarter," Kennedy continued, "and were up about 10% over last year. However, there are clearly potentially adverse factors which could impact our results, such as the unsettled condition of the banking and the savings and loan industries."
"Last week we reported a recent adverse California court ruling which could result in a maximum title loss of $6,100,000. This ruling will be appealed. At this time, no loss reserve can be properly established until the validity of claimant's rights and other legal matters can be determined."
"In spite of these reservations," Kennedy concluded, "we feel First American is well positioned to increase its market share and its revenues during the coming year. In this respect, we are continuing to actively pursue potential acquisitions."
The First American Financial Corporation, based in Santa Ana, California, operates its title insurance business through its principal subsidiary, First American Title Insurance Company, one of the largest title insurers in the nation. The firm offers title services through a network of more than 5,500 offices or agents in all 50 states. It also provides title services abroad in Guam, Mexico, Puerto Rico, the Virgin Islands and the United Kingdom.
Three months ended March 31: 1990 1989 Revenues $163,633,000 $165,290,000 Net income (loss) $ 852,000 $ (1,263,000) Net income (loss) per share $ .09 $ (.13)* Average shares outstanding 9,971,000 9,874,000 *
* Restated to reflect dividend of Class B Common shares issued on November 20, 1989.