The First American Financial Corporation reports a loss in the first quarter of 1991
May 17, 1991, SANTA ANA, CALIFORNIA
For the three months ended March 31, 1991, First American Financial had a net loss of $9,540,000, or 97 cents per share. This compares with 1990 first quarter income of $852,000, or 9 cents per share.
Revenues for the quarter were $147,659,000, compared with 1990 first quarter revenues of $163,633,000.
"Although new title orders increased 27 percent during the first quarter of 1991 compared with fourth quarter 1990, revenue-producing closings did not begin to materialize until late March 1991," Kennedy said.
Staff reductions resulted in a decrease in salary and other personnel costs of $1,800,000 compared with the fourth quarter 1990, despite the increase in open orders.
"Although there is little evidence that the new housing markets and the commercial real estate markets will reach satisfactory levels in the near future," Kennedy continued, "it is apparent that the resale housing market has strengthened substantially."
The company experienced a decline in the dollar amount of claims made during the first quarter 1991 as compared with the same quarter in 1990. "We are hopeful that this decline will continue," Kennedy said, "although, unfortunately, additional reserves were required in the first quarter because of adverse developments in claims filed in prior periods."
Based on current trends, the company expects profitable second and third quarters, Kennedy added. "We feel this optimism is justified by the continuation of low interest rates and a low rate of inflation."
The First American Financial Corporation, based in Santa Ana, Calif., operates its title insurance business through its principal subsidiary, First American Title Insurance Company, one of the largest title insurers in the nation. The company 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 the Bahamas, Bermuda, Guam, Mexico, Puerto Rico, the Virgin Islands and the United Kingdom.
Three months ended March 31: 1991 1990 Revenues $147,659,000 $163,633,000 Net income (loss) $ (9,540,000) $ 852,000 Net income (loss) per share $ (.97) $ .09 Average shares outstanding 9,843,000 9,971,000