First American Posts Q1 Return to Profit

Business information provider The First American Corp. (FAF) posted $36m in net quarterly profit — or 38 cents per share — for Q109 from $29.3m in the year-ago period. The quarter’s return to profit compares with $67m in net losses posted in Q408. “The company benefited from a surge in origination and default-related transaction activity, as well as continued expense reductions,” says chair and CEO Parker Kennedy in the earnings statement. FirstAm also posted $1.4bn in total revenues, which slipped 17% from the year-ago quarter. Corporate expenses fell 26% from the prior-year period, while the company saw order volumes across all mortgage-related businesses increase over last year. The company’s insurance operations posted a substantial quarterly increase in open orders, according to company executive Dennis Gilmore. FirstAm’s Title Insurance and Services business segment saw $792.4m in total quarterly revenue, a 26% slide from the year-ago period. The company’s direct operations closed 369,200 title orders for Q109, a 5% decrease from title orders closed in Q108. “Orders are taking longer to close as a result of the backlog in the mortgage lending industry, but we have a strong inventory of orders that are expected to close in the second quarter,” Gilmore said. Read First American’s earnings statement. Write to Diana Golobay at [email protected]. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments.