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First American Financial Reports Second Quarter 2013 Results

First American Financial Corporation (NYSE: FAF), a leading global provider of title insurance and settlement services for residential and commercial real estate transactions, today announced financial results for the second quarter ended June 30, 2013.

Current Quarter Highlights
  • Total revenues up 18 percent compared with last year
  • Title Insurance and Services segment pretax margin of 6.1 percent
    • Adjusted pretax title margin of 13.4 percent, excluding $89.0 million reserve strengthening, or 730 basis points, primarily due to domestic lender claims for policy years 2004-2008
  • Title order mix continues to shift toward higher-premium resale transactions
    • Resale open orders per day up 19 percent compared with last year
    • Refinance open orders per day down 9 percent compared with last year
  • Commercial division revenues of $133.0 million, up 35 percent compared with last year
  • Specialty Insurance segment total revenues up 6 percent, with a pretax margin of 8.7 percent
  • Cash flow from operations of $209.3 million
  • Repurchased 1.6 million common shares for $35.6 million in June and July

Selected Financial Information

($ in millions, except per share data)
For the Three Months Ended

June 30
2013                 2012
Total revenues $ 1,288.5                 $ 1,089.8
Income before taxes 59.2 112.3
Net income $ 34.7 $ 73.0
Net income per diluted share 0.31 0.68

Total revenues for the second quarter of 2013 were $1.3 billion, an increase of 18 percent relative to the second quarter of 2012. Net income in the current quarter was $34.7 million, or 31 cents per diluted share, compared with net income of $73.0 million, or 68 cents per diluted share, in the second quarter of 2012. The current quarter results include an $89.0 million reserve strengthening, or 48 cents per diluted share net of tax. The current quarter results also include net realized investment gains of $4.5 million, or 2 cents per diluted share, compared with net realized investment gains of $11.6 million, or 6 cents per diluted share, in the second quarter of 2012.

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