The First American Financial Corporation announces significantly improved first ...


April 24, 1996, SANTA ANA, CALIFORNIA

The First American Financial Corporation (NYSE: FAF) announced today a dramatic improvement in first quarter operating profits compared to first quarter 1995. Net income for the first quarter 1996 increased to $8.6 million, or 75¢ per share, compared with a first quarter 1995 net loss of $12.7 million, or $1.11 per share. Revenues for the first three months of 1996 totaled $347.4 million, an increase of 33 percent from the first quarter 1995 revenues of $261.2 million.

A continuation of lower mortgage interest rates and an improved real estate economy (including the beginnings of a modest recovery in California) during the fourth quarter of 1995 and the first quarter of 1996 were the primary factors contributing to the increase in closed transactions and revenues for the quarter.

"We are extremely pleased with our first quarter results, especially the contribution from our information services segment," said President Parker S. Kennedy. "The first quarter is traditionally a slower period for real estate activity, so we are gratified by the improved start in 1996.

"An increase in mortgage interest rates during March reduced refinance transactions approximately 50 percent," Kennedy continued. "However, resales and builder activity have remained strong across the country and, given the current interest rate environment, this should continue throughout the remainder of the spring and summer months.

"We have worked hard to become the leading provider of real estate-related financial and informational services and remain focused on increasing market share in all of our primary businesses," Kennedy said.

The First American Financial Corporation, based in Santa Ana, California, is the nation's leading provider of real estate-related financial and informational services. The corporation's subsidiaries include First American Title Insurance Company, a national and international title insurer, First American Real Estate Information Services, Inc., which offers tax monitoring, credit reporting, flood certification, mortgage loan servicing systems and property information services nationally, and First American Home Buyers Protection Corporation, a home warranty company. The corporation also operates First American Trust Company and First Security Thrift in Southern California. First American Financial has over 10,000 employees in over 400 branch offices in the United States and abroad.

Any statements looking forward in time inherently involve risks and uncertainties, including but not limited to the effect of interest rate fluctuations, changes in the performance of the real estate markets and the effect of changing economic conditions.
 
Quarter ended March 31:			1996		1995 
				 
Revenues			    $347,376,000    $261,154,000  
Income (loss) before  
income taxes			    $ 14,982,000    $(21,509,000) 
Net income (loss)		    $  8,582,000    $(12,709,000) 
Net income (loss) per share	    $	    0.75    $      (1.11) 
Average shares outstanding	      11,428,000      11,401,000  
SELECTED FINANCIAL DATA
(Unaudited)


For the Three Months Ended

March 31



1996
1995


RESULTS OF OPERATIONS
Revenues
  Operating revenues
$ 340,879,000
$ 256,288,000
  Investment and other income
6,497,000
4,866,000





347,376,000
261,154,000




Expenses
  Salaries and other personnel costs
120,240,000
100,050,000
  Premiums retained by agents
109,872,000
93,395,000
  Other operating expenses
73,464,000
59,287,000
  Provision for title losses and other claims
18,975,000
21,306,000
  Depreciation and amortization
4,449,000
4,211,000
  Interest
1,229,000
1,613,000
  Minority interests
620,000
(20,000)





328,849,000
279,842,000




Income (loss) before premium and income taxes
18,527,000
(18,688,000)
Premium taxes
3,545,000
2,821,000




Income (loss) before income taxes
$ 14,982,000
$ (21,509,000)




OPERATING REVENUES
  Title Insurance:
  Direct operations
$ 137,490,000
$ 104,291,000
  Agency operations
136,364,000
115,026,000





273,854,000
219,317,000
  Real Estate Information
54,394,000
26,105,000
  Home Warranty
8,739,000
7,389,000
  Trust and Banking
3,892,000
3,477,000




   Total operating revenues
$ 340,879,000
$ 256,288,000




INCOME (LOSS) BEFORE INCOME TAXES
  Title Insurance
$ 8,159,000
$ (14,561,000)
  Real Estate Information
13,782,000
(1,380,000)
  Home Warranty
2,288,000
1,528,000
  Trust and Banking
779,000
932,000




   Total before corporate expenses and
   premium taxes

25,008,000
(13,481,000)
  Corporate expenses
6,481,000
5,207,000
  Premium taxes
3,545,000
2,821,000




Income (loss) before income taxes
$ 14,982,000
$ (21,509,000)




TITLE INSURANCE ORDER COUNTS
FROM DIRECT OPERATIONS

  Title orders opened
272,500
190,600
  Title orders closed
177,600
135,300

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