First American Financial Reports Third Quarter 2024 Results
First American Financial (NYSE: FAF) reported a net loss of $104 million, or $(1.00) per diluted share, in Q3 2024. Adjusted earnings were $1.34 per share. Total revenue decreased 5% to $1.4 billion, while adjusted revenue increased 4% to $1.7 billion. The company experienced significant net investment losses of $312 million due to portfolio rebalancing, which is expected to generate additional annual interest income of $67 million. Commercial revenues showed strong performance, up 19% to $190 million. The company maintained its dividend policy, raising it by 2% to $2.16 per share annually, and repurchased 293,155 shares for $16 million.
First American Financial (NYSE: FAF) ha riportato una perdita netta di 104 milioni di dollari, o $(1.00) per azione diluita, nel terzo trimestre del 2024. Gli utili rettificati sono stati di $1.34 per azione. Il fatturato totale è diminuito del 5%, raggiungendo i $1,4 miliardi, mentre il fatturato rettificato è aumentato del 4%, arrivando a $1,7 miliardi. L'azienda ha subito perdite nette significative sugli investimenti di 312 milioni di dollari a causa del riequilibrio del portafoglio, il quale dovrebbe generare ulteriori entrate annuali da interessi di 67 milioni di dollari. I ricavi commerciali hanno mostrato una solida performance, con un aumento del 19% a $190 milioni. L'azienda ha mantenuto la sua politica sui dividendi, aumentando il dividendo del 2% a $2.16 per azione all'anno, e ha riacquistato 293.155 azioni per 16 milioni di dollari.
First American Financial (NYSE: FAF) reportó una pérdida neta de 104 millones de dólares, o $(1.00) por acción diluida, en el tercer trimestre de 2024. Las ganancias ajustadas fueron de $1.34 por acción. Los ingresos totales disminuyeron un 5% a $1.4 mil millones, mientras que los ingresos ajustados aumentaron un 4% a $1.7 mil millones. La compañía experimentó pérdidas significativas en inversiones netas de 312 millones de dólares debido al reajuste de cartera, lo que se espera genere ingresos adicionales anuales por intereses de 67 millones de dólares. Los ingresos comerciales mostraron un buen desempeño, aumentando un 19% a $190 millones. La compañía mantuvo su política de dividendos, aumentando este en un 2% a $2.16 por acción anualmente, y recompró 293,155 acciones por 16 millones de dólares.
퍼스트 아메리칸 파이낸셜(뉴욕증권거래소: FAF)는 2024년 3분기에 1억 4천만 달러의 순손실, 즉 희석 주당 $(1.00)를 보고했습니다. 조정된 수익은 주당 $1.34였습니다. 총 수익은 5% 감소하여 14억 달러에 이르렀고, 조정된 수익은 4% 증가하여 17억 달러에 달했습니다. 회사는 포트폴리오 리밸런싱으로 인해 3억 1천2백만 달러의 상당한 순투자 손실을 경험했으며, 이는 연간 추가 이자 수익 6천7백만 달러를 생성할 것으로 예상됩니다. 상업 수익은 강력한 성과를 보이며 19% 증가하여 1억 9천만 달러를 기록했습니다. 회사는 배당금 정책을 유지하며 이를 연간 주당 2% 인상하여 2.16달러에 이르게 했고, 1천만 달러에 해당하는 293,155주를 재매입했습니다.
First American Financial (NYSE: FAF) a annoncé une perte nette de 104 millions de dollars, soit $(1.00) par action diluée, au troisième trimestre de 2024. Les bénéfices ajustés s'élevaient à 1,34 dollar par action. Le chiffre d'affaires total a diminué de 5 % pour atteindre 1,4 milliard de dollars, tandis que le chiffre d'affaires ajusté a augmenté de 4 % pour atteindre 1,7 milliard de dollars. L'entreprise a subi d'importantes pertes nettes d'investissement de 312 millions de dollars en raison d'un rééquilibrage du portefeuille, ce qui devrait générer des revenus d'intérêts annuels supplémentaires de 67 millions de dollars. Les revenus commerciaux ont affiché de solides performances, augmentant de 19 % pour atteindre 190 millions de dollars. L'entreprise a maintenu sa politique de dividendes, en l'augmentant de 2 % à 2,16 dollars par action par an, et a racheté 293 155 actions pour 16 millions de dollars.
First American Financial (NYSE: FAF) berichtete im 3. Quartal 2024 von einem Nettoverlust in Höhe von 104 Millionen US-Dollar, oder $(1.00) pro verwässerter Aktie. Die bereinigten Gewinne betrugen 1,34 US-Dollar pro Aktie. Der Gesamtumsatz sank um 5 % auf 1,4 Milliarden US-Dollar, während der bereinigte Umsatz um 4 % auf 1,7 Milliarden US-Dollar anstieg. Das Unternehmen erlitt erhebliche Nettoverluste aus Investitionen in Höhe von 312 Millionen US-Dollar aufgrund einer Portfolioumbewertung, die voraussichtlich jährliche zusätzliche Zinserträge von 67 Millionen US-Dollar generieren wird. Die Gewerbeeinnahmen wiesen eine starke Performance auf und stiegen um 19 % auf 190 Millionen US-Dollar. Das Unternehmen hielt an seiner Dividendenpolitik fest und erhöhte diese um 2 % auf 2,16 US-Dollar pro Aktie und kaufte 293.155 Aktien für 16 Millionen US-Dollar zurück.
- Adjusted revenue increased 4% to $1.7 billion
- Commercial revenues grew 19% to $190 million
- Portfolio rebalancing expected to generate $67 million additional annual interest income
- Adjusted earnings per share increased 10% to $1.34
- Operating cash flow improved to $237 million from $219 million
- Net loss of $104 million ($1.00 per diluted share)
- Total revenue declined 5% to $1.4 billion
- Net investment losses of $312 million
- Title Insurance segment investment income down 4%
- Debt-to-capital ratio increased to 34.8%
Insights
First American Financial's Q3 results show mixed performance with significant investment portfolio adjustments. The
Commercial revenues stood out, increasing
The debt-to-capital ratio of
Current Quarter Highlights
-
Earnings per diluted share of
$(1.00) $1.34 -
Net investment losses of
$312 million $2.28
-
Net investment losses of
-
Rebalanced investment portfolio expected to result in an increase in interest income of approximately
$67 million -
Total revenue of
$1.4 billion -
Adjusted total revenue of
$1.7 billion
-
Adjusted total revenue of
-
Title Insurance and Services segment investment income of
$136 million - Title Insurance and Services segment pretax margin of (10.1) percent, or 11.6 percent on an adjusted basis
-
Commercial revenues of
$190 million - Home Warranty segment pretax margin of 8.1 percent, or 7.7 percent on an adjusted basis
-
Debt-to-capital ratio of 34.8 percent, or 26.6 percent excluding secured financings payable of
$878 million -
Repurchased 293,155 shares for a total of
$16 million $54.96 -
Year to date, repurchased 1.1 million shares for a total of
$60 million $54.64
-
Year to date, repurchased 1.1 million shares for a total of
-
Raised common stock dividend by 2 percent to an annual rate of
$2.16 -
Raised
$450 million -
Cash flow from operations of
$237 million $219 million
Selected Financial Information
|
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Three Months Ended |
|
|||||
|
|
September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Total revenue |
|
$ |
1,406.1 |
|
|
$ |
1,481.2 |
|
Income/(loss) before taxes |
|
$ |
(144.4 |
) |
|
$ |
(1.7 |
) |
|
|
|
|
|
|
|
||
Net income/(loss) |
|
$ |
(104.0 |
) |
|
$ |
(1.7 |
) |
Net income/(loss) per diluted share |
|
$ |
(1.00 |
) |
|
$ |
(0.02 |
) |
|
|
|
|
|
|
|
||
Adjusted net income |
|
$ |
138.4 |
|
|
$ |
128.2 |
|
Adjusted net income per diluted share |
|
$ |
1.34 |
|
|
$ |
1.22 |
|
Total revenue for the third quarter of 2024 was
“We benefited from measured improvement in market conditions during the third quarter, with adjusted revenue up 4 percent, the first year-over-year growth since the second quarter of 2022,” said Ken DeGiorgio, chief executive officer at First American Financial Corporation. “Our adjusted earnings per diluted share were
"As we indicated last quarter, we expect that modest revenue growth for the full year of 2024 will enable us to achieve title margins similar to what we posted in 2023. We now have stronger conviction in that outcome given the recent performance of our commercial business and the increase in interest income resulting from a rebalancing of our investment portfolio. The first year-over-year growth in revenue in nine quarters, coupled with our expectation that affordability challenges will gradually abate, also make us cautiously optimistic that we are in the beginning stage of a new cycle that will drive further improvement in 2025.
"The recent hurricanes inflicted widespread damage and devastation across several southeastern states. Many of our employees — and the communities in which they live — have endured profound hardships. While we are grateful that all of our people are safe, we know that many now face the difficult task of recovery. I want to thank our people for all they have done to lend a hand to those impacted and to reiterate our company’s commitment to support our people and their communities."
Title Insurance and Services
|
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Three Months Ended |
|
|||||
|
|
September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Total revenues |
|
$ |
1,290.3 |
|
|
$ |
1,524.4 |
|
|
|
|
|
|
|
|
||
Income/(loss) before taxes |
|
$ |
(130.3 |
) |
|
$ |
160.3 |
|
Pretax margin |
|
|
(10.1 |
)% |
|
|
10.5 |
% |
Adjusted pretax margin |
|
|
11.6 |
% |
|
|
12.0 |
% |
|
|
|
|
|
|
|
||
Title open orders(1) |
|
|
166,100 |
|
|
|
157,300 |
|
Title closed orders(1) |
|
|
121,600 |
|
|
|
120,000 |
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
Total revenues |
|
$ |
189.9 |
|
|
$ |
159.8 |
|
Open orders |
|
|
25,500 |
|
|
|
25,200 |
|
Closed orders |
|
|
14,400 |
|
|
|
14,800 |
|
Average revenue per order |
|
$ |
13,200 |
|
|
$ |
10,800 |
|
(1) |
|
|
|
|
|
|
||
Total revenues for the Title Insurance and Services segment during the third quarter were
Information and other revenues were
Investment income was
Personnel costs were
Other operating expenses of
The provision for policy losses and other claims was
Depreciation and amortization expense was
Interest expense was
The Title Insurance and Services segment posted a pretax loss of
Home Warranty
|
||||||||
|
|
Three Months Ended |
|
|||||
|
|
September 30, |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Total revenues |
|
$ |
110.9 |
|
|
$ |
108.2 |
|
|
|
|
|
|
|
|
||
Income before taxes |
|
$ |
9.0 |
|
|
$ |
9.4 |
|
Pretax margin |
|
|
8.1 |
% |
|
|
8.7 |
% |
Adjusted pretax margin |
|
|
7.7 |
% |
|
|
9.3 |
% |
Total revenues for the Home Warranty segment were
Corporate
Net investment income was
Net recognized investment losses were
Teleconference/Webcast
First American’s third quarter 2024 results will be discussed in more detail on Thursday, Oct. 24, 2024, at 11 a.m. EDT, via teleconference. The toll-free dial-in number is +1-877-407-8293. Callers from outside
The live audio webcast of the call will be available on First American’s website at www.firstam.com/investor. An audio replay of the conference call will be available through Nov. 7, 2024, by dialing +1-201-612-7415 and using the conference ID 13749447. An audio archive of the call will also be available on First American’s investor website.
About First American
First American Financial Corporation (NYSE: FAF) is a premier provider of title, settlement and risk solutions for real estate transactions. With its combination of financial strength and stability built over 135 years, innovative proprietary technologies, and unmatched data assets, the company is leading the digital transformation of its industry. First American also provides data products to the title industry and other third parties; valuation products and services; mortgage subservicing; home warranty products; banking, trust and wealth management services; and other related products and services. With total revenue of
Website Disclosure
First American posts information of interest to investors at www.firstam.com/investor. This includes opened and closed title insurance order counts for its
Forward-Looking Statements
Certain statements made in this press release and the related management commentary contain, and responses to investor questions may contain, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and may contain the words “believe,” “anticipate,” “expect,” “intend,” “plan,” “predict,” “estimate,” “project,” “will be,” “will continue,” “will likely result,” or other similar words and phrases or future or conditional verbs such as “will,” “may,” “might,” “should,” “would,” or “could.” These forward-looking statements include, without limitation, statements regarding future operations, performance, financial condition, prospects, plans and strategies. These forward-looking statements are based on current expectations and assumptions that may prove to be incorrect. Risks and uncertainties exist that may cause results to differ materially from those set forth in these forward-looking statements. Factors that could cause the anticipated results to differ from those described in the forward-looking statements include, without limitation: interest rate fluctuations; changes in conditions of the real estate markets; volatility in the capital markets; unfavorable economic conditions; impairments in the company’s goodwill or other intangible assets; failures at financial institutions where the company deposits funds; regulatory oversight and changes in applicable laws and government regulations, including privacy and data protection laws; heightened scrutiny by legislators and regulators of the company’s title insurance and services segment and certain other of the company’s businesses; regulation of title insurance rates; limitations on access to public records and other data; climate change, health crises, terrorist attacks, severe weather conditions and other catastrophe events; changes in relationships with large mortgage lenders and government-sponsored enterprises; changes in measures of the strength of the company’s title insurance underwriters, including ratings and statutory capital and surplus; losses in the company’s investment portfolio or venture investment portfolio; material variance between actual and expected claims experience; defalcations, increased claims or other costs and expenses attributable to the company’s use of title agents; any inadequacy in the company’s risk management framework or use of models; systems damage, failures, interruptions, cyberattacks and intrusions, or unauthorized data disclosures; innovation efforts of the company and other industry participants and any related market disruption; errors and fraud involving the transfer of funds; failures to recruit and retain qualified employees; the company’s use of a global workforce; inability of the company to fulfill parent company obligations and/or pay dividends; inability to realize anticipated synergies or produce returns that justify investment in acquired businesses; a reduction in the deposits at the company’s federal savings bank subsidiary; claims of infringement or inability to adequately protect the company’s intellectual property; and other factors described in the company’s quarterly report on Form 10-Q for the quarter ended June 30, 2024, as filed with the Securities and Exchange Commission. The forward-looking statements speak only as of the date they are made. The company does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.
Use of Non-GAAP Financial Measures
This news release and related management commentary contain certain financial measures that are not presented in accordance with generally accepted accounting principles (GAAP), including an adjusted debt to capitalization ratio, personnel and other operating expense ratios, success ratios, net operating revenues; and adjusted revenues, adjusted pretax income, adjusted pretax margin, adjusted net income, and adjusted earnings per share. The company is presenting these non-GAAP financial measures because they provide the company’s management and investors with additional insight into the financial leverage, operational efficiency and performance of the company relative to earlier periods and relative to the company’s competitors. The company does not intend for these non-GAAP financial measures to be a substitute for any GAAP financial information. In this news release, these non-GAAP financial measures have been presented with, and reconciled to, the most directly comparable GAAP financial measures. Investors should use these non-GAAP financial measures only in conjunction with the comparable GAAP financial measures.
First American Financial Corporation |
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Summary of Consolidated Financial Results and Selected Information |
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(in millions, except per share amounts and title orders, unaudited) |
|
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|
||||
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|
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|
|
|
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|
||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Total revenues |
|
$ |
1,406.1 |
|
|
$ |
1,481.2 |
|
|
$ |
4,443.0 |
|
|
$ |
4,574.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(Loss) income before income taxes |
|
$ |
(144.4 |
) |
|
$ |
(1.7 |
) |
|
$ |
65.5 |
|
|
$ |
236.0 |
|
Income tax (benefit) expense |
|
|
(41.0 |
) |
|
|
(0.5 |
) |
|
|
5.8 |
|
|
|
54.8 |
|
Net (loss) income |
|
|
(103.4 |
) |
|
|
(1.2 |
) |
|
|
59.7 |
|
|
|
181.2 |
|
Less: Net income (loss) attributable to noncontrolling interests |
|
|
0.6 |
|
|
|
0.5 |
|
|
|
1.0 |
|
|
|
(1.5 |
) |
Net (loss) income attributable to the Company |
|
$ |
(104.0 |
) |
|
$ |
(1.7 |
) |
|
$ |
58.7 |
|
|
$ |
182.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net (loss) income per share attributable to stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
(1.00 |
) |
|
$ |
(0.02 |
) |
|
$ |
0.56 |
|
|
$ |
1.75 |
|
Diluted |
|
$ |
(1.00 |
) |
|
$ |
(0.02 |
) |
|
$ |
0.56 |
|
|
$ |
1.75 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash dividends declared per share |
|
$ |
0.54 |
|
|
$ |
0.53 |
|
|
$ |
1.60 |
|
|
$ |
1.57 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
103.6 |
|
|
|
104.2 |
|
|
|
103.9 |
|
|
|
104.4 |
|
Diluted |
|
|
103.6 |
|
|
|
104.2 |
|
|
|
104.3 |
|
|
|
104.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Selected Title Insurance Segment Information |
|
|
|
|
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|
|
|
|
|
|
|
||||
Title orders opened(1) |
|
|
166,100 |
|
|
|
157,300 |
|
|
|
491,200 |
|
|
|
504,500 |
|
Title orders closed(1) |
|
|
121,600 |
|
|
|
120,000 |
|
|
|
349,000 |
|
|
|
354,900 |
|
Paid title claims |
|
$ |
56.8 |
|
|
$ |
47.5 |
|
|
$ |
150.8 |
|
|
$ |
125.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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(1) |
|
|
|
|
|
|
|
|
|
|
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|
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First American Financial Corporation |
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Selected Consolidated Balance Sheet Information |
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(in millions, unaudited) |
|
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|
||
|
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|
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|
|
|
||
|
|
September 30, |
|
|
December 31, |
|
||
|
|
2024 |
|
|
2023 |
|
||
Cash and cash equivalents |
|
$ |
2,953.4 |
|
|
$ |
3,605.3 |
|
Investments |
|
|
7,795.7 |
|
|
|
7,948.9 |
|
Goodwill and other intangible assets, net |
|
|
1,945.3 |
|
|
|
1,961.3 |
|
Total assets |
|
|
16,566.4 |
|
|
|
16,802.8 |
|
Reserve for claim losses |
|
|
1,230.0 |
|
|
|
1,282.4 |
|
Notes and contracts payable |
|
|
1,847.7 |
|
|
|
1,393.9 |
|
Total stockholders’ equity |
|
$ |
5,092.2 |
|
|
$ |
4,848.1 |
|
First American Financial Corporation |
|
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Segment Information |
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(in millions, unaudited) |
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Three Months Ended |
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|
Title |
|
|
Home |
|
|
Corporate |
|
||||
September 30, 2024 |
|
Consolidated |
|
|
Insurance |
|
|
Warranty |
|
|
(incl. Elims.) |
|
||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct premiums and escrow fees |
|
$ |
639.6 |
|
|
$ |
536.2 |
|
|
$ |
103.5 |
|
|
$ |
(0.1 |
) |
Agent premiums |
|
|
683.9 |
|
|
|
683.9 |
|
|
|
— |
|
|
|
— |
|
Information and other |
|
|
247.5 |
|
|
|
241.7 |
|
|
|
5.7 |
|
|
|
0.1 |
|
Net investment income |
|
|
146.6 |
|
|
|
136.5 |
|
|
|
1.2 |
|
|
|
8.9 |
|
Net investment (losses) gains |
|
|
(311.5 |
) |
|
|
(308.0 |
) |
|
|
0.5 |
|
|
|
(4.0 |
) |
|
|
|
1,406.1 |
|
|
|
1,290.3 |
|
|
|
110.9 |
|
|
|
4.9 |
|
Expenses |
|
|
|
|
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|
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|
||||
Personnel costs |
|
|
523.6 |
|
|
|
491.7 |
|
|
|
20.6 |
|
|
|
11.3 |
|
Premiums retained by agents |
|
|
546.7 |
|
|
|
546.7 |
|
|
|
— |
|
|
|
— |
|
Other operating expenses |
|
|
279.8 |
|
|
|
251.8 |
|
|
|
23.0 |
|
|
|
5.0 |
|
Provision for policy losses and other claims |
|
|
91.8 |
|
|
|
36.6 |
|
|
|
55.7 |
|
|
|
(0.5 |
) |
Depreciation and amortization |
|
|
53.2 |
|
|
|
51.9 |
|
|
|
1.3 |
|
|
|
0.0 |
|
Premium taxes |
|
|
19.2 |
|
|
|
17.8 |
|
|
|
1.3 |
|
|
|
0.1 |
|
Interest |
|
|
36.2 |
|
|
|
24.1 |
|
|
|
— |
|
|
|
12.1 |
|
|
|
|
1,550.5 |
|
|
|
1,420.6 |
|
|
|
101.9 |
|
|
|
28.0 |
|
(Loss) income before income taxes |
|
$ |
(144.4 |
) |
|
$ |
(130.3 |
) |
|
$ |
9.0 |
|
|
$ |
(23.1 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Three Months Ended |
|
|
|
|
Title |
|
|
Home |
|
|
Corporate |
|
||||
September 30, 2023 |
|
Consolidated |
|
|
Insurance |
|
|
Warranty |
|
|
(incl. Elims.) |
|
||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct premiums and escrow fees |
|
$ |
595.5 |
|
|
$ |
493.7 |
|
|
$ |
101.8 |
|
|
$ |
0.0 |
|
Agent premiums |
|
|
664.5 |
|
|
|
664.5 |
|
|
|
— |
|
|
|
— |
|
Information and other |
|
|
245.7 |
|
|
|
240.1 |
|
|
|
5.5 |
|
|
|
0.1 |
|
Net investment income |
|
|
139.1 |
|
|
|
141.7 |
|
|
|
1.6 |
|
|
|
(4.2 |
) |
Net investment losses |
|
|
(163.6 |
) |
|
|
(15.6 |
) |
|
|
(0.7 |
) |
|
|
(147.3 |
) |
|
|
|
1,481.2 |
|
|
|
1,524.4 |
|
|
|
108.2 |
|
|
|
(151.4 |
) |
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Personnel costs |
|
|
485.8 |
|
|
|
468.5 |
|
|
|
19.6 |
|
|
|
(2.3 |
) |
Premiums retained by agents |
|
|
531.4 |
|
|
|
531.4 |
|
|
|
— |
|
|
|
— |
|
Other operating expenses |
|
|
273.8 |
|
|
|
243.2 |
|
|
|
20.9 |
|
|
|
9.7 |
|
Provision for policy losses and other claims |
|
|
91.1 |
|
|
|
34.8 |
|
|
|
55.9 |
|
|
|
0.4 |
|
Depreciation and amortization |
|
|
47.3 |
|
|
|
46.2 |
|
|
|
1.2 |
|
|
|
(0.1 |
) |
Premium taxes |
|
|
17.7 |
|
|
|
16.4 |
|
|
|
1.2 |
|
|
|
0.1 |
|
Interest |
|
|
35.8 |
|
|
|
23.6 |
|
|
|
— |
|
|
|
12.2 |
|
|
|
|
1,482.9 |
|
|
|
1,364.1 |
|
|
|
98.8 |
|
|
|
20.0 |
|
(Loss) income before income taxes |
|
$ |
(1.7 |
) |
|
$ |
160.3 |
|
|
$ |
9.4 |
|
|
$ |
(171.4 |
) |
First American Financial Corporation |
|
|||||||||||||||
Segment Information |
|
|||||||||||||||
(in millions, unaudited) |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Nine Months Ended |
|
|
|
|
Title |
|
|
Home |
|
|
Corporate |
|
||||
September 30, 2024 |
|
Consolidated |
|
|
Insurance |
|
|
Warranty |
|
|
(incl. Elims.) |
|
||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct premiums and escrow fees |
|
$ |
1,773.2 |
|
|
$ |
1,472.4 |
|
|
$ |
300.8 |
|
|
$ |
(0.0 |
) |
Agent premiums |
|
|
1,864.0 |
|
|
|
1,864.0 |
|
|
|
— |
|
|
|
— |
|
Information and other |
|
|
717.1 |
|
|
|
699.8 |
|
|
|
17.4 |
|
|
|
(0.1 |
) |
Net investment income |
|
|
404.4 |
|
|
|
378.9 |
|
|
|
3.2 |
|
|
|
22.3 |
|
Net investment (losses) gains |
|
|
(315.7 |
) |
|
|
(283.1 |
) |
|
|
1.5 |
|
|
|
(34.1 |
) |
|
|
|
4,443.0 |
|
|
|
4,132.0 |
|
|
|
322.9 |
|
|
|
(11.9 |
) |
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Personnel costs |
|
|
1,517.5 |
|
|
|
1,429.8 |
|
|
|
61.2 |
|
|
|
26.5 |
|
Premiums retained by agents |
|
|
1,486.7 |
|
|
|
1,486.7 |
|
|
|
— |
|
|
|
— |
|
Other operating expenses |
|
|
822.6 |
|
|
|
729.1 |
|
|
|
66.7 |
|
|
|
26.8 |
|
Provision for policy losses and other claims |
|
|
240.8 |
|
|
|
100.1 |
|
|
|
142.0 |
|
|
|
(1.3 |
) |
Depreciation and amortization |
|
|
155.4 |
|
|
|
151.6 |
|
|
|
3.7 |
|
|
|
0.1 |
|
Premium taxes |
|
|
48.6 |
|
|
|
45.0 |
|
|
|
3.5 |
|
|
|
0.1 |
|
Interest |
|
|
105.9 |
|
|
|
69.9 |
|
|
|
— |
|
|
|
36.0 |
|
|
|
|
4,377.5 |
|
|
|
4,012.2 |
|
|
|
277.1 |
|
|
|
88.2 |
|
Income (loss) before income taxes |
|
$ |
65.5 |
|
|
$ |
119.8 |
|
|
$ |
45.8 |
|
|
$ |
(100.1 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Nine Months Ended |
|
|
|
|
Title |
|
|
Home |
|
|
Corporate |
|
||||
September 30, 2023 |
|
Consolidated |
|
|
Insurance |
|
|
Warranty |
|
|
(incl. Elims.) |
|
||||
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct premiums and escrow fees |
|
$ |
1,713.0 |
|
|
$ |
1,416.1 |
|
|
$ |
296.9 |
|
|
$ |
0.0 |
|
Agent premiums |
|
|
1,879.6 |
|
|
|
1,879.6 |
|
|
|
— |
|
|
|
— |
|
Information and other |
|
|
722.9 |
|
|
|
706.0 |
|
|
|
16.9 |
|
|
|
(0.0 |
) |
Net investment income |
|
|
423.4 |
|
|
|
408.2 |
|
|
|
4.4 |
|
|
|
10.8 |
|
Net investment (losses) gains |
|
|
(164.7 |
) |
|
|
(6.2 |
) |
|
|
0.2 |
|
|
|
(158.7 |
) |
|
|
|
4,574.2 |
|
|
|
4,403.7 |
|
|
|
318.4 |
|
|
|
(147.9 |
) |
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Personnel costs |
|
|
1,487.9 |
|
|
|
1,412.3 |
|
|
|
59.3 |
|
|
|
16.3 |
|
Premiums retained by agents |
|
|
1,496.8 |
|
|
|
1,496.8 |
|
|
|
— |
|
|
|
— |
|
Other operating expenses |
|
|
804.8 |
|
|
|
710.4 |
|
|
|
62.4 |
|
|
|
32.0 |
|
Provision for policy losses and other claims |
|
|
262.9 |
|
|
|
109.6 |
|
|
|
150.1 |
|
|
|
3.2 |
|
Depreciation and amortization |
|
|
138.9 |
|
|
|
135.2 |
|
|
|
3.6 |
|
|
|
0.1 |
|
Premium taxes |
|
|
47.7 |
|
|
|
44.2 |
|
|
|
3.4 |
|
|
|
0.1 |
|
Interest |
|
|
99.2 |
|
|
|
61.0 |
|
|
|
— |
|
|
|
38.2 |
|
|
|
|
4,338.2 |
|
|
|
3,969.5 |
|
|
|
278.8 |
|
|
|
89.9 |
|
Income (loss) before income taxes |
|
$ |
236.0 |
|
|
$ |
434.2 |
|
|
$ |
39.6 |
|
|
$ |
(237.8 |
) |
First American Financial Corporation |
|
|||||||||||||||
Reconciliation of Non-GAAP Financial Measures |
|
|||||||||||||||
(in millions, except margin and per share amounts, unaudited) |
|
|||||||||||||||
Consolidated |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total revenues |
|
$ |
1,406.1 |
|
|
$ |
1,481.2 |
|
|
$ |
4,443.0 |
|
|
$ |
4,574.2 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment losses |
|
|
(311.5 |
) |
|
|
(163.6 |
) |
|
|
(315.7 |
) |
|
|
(164.7 |
) |
Adjusted total revenues |
|
$ |
1,717.6 |
|
|
$ |
1,644.8 |
|
|
$ |
4,758.7 |
|
|
$ |
4,738.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Pretax (loss) income |
|
$ |
(144.4 |
) |
|
$ |
(1.7 |
) |
|
$ |
65.5 |
|
|
$ |
236.0 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment losses |
|
|
(311.5 |
) |
|
|
(163.6 |
) |
|
|
(315.7 |
) |
|
|
(164.7 |
) |
Plus: Purchase-related intangible amortization |
|
|
7.7 |
|
|
|
9.6 |
|
|
|
25.4 |
|
|
|
28.9 |
|
Adjusted pretax income |
|
$ |
174.8 |
|
|
$ |
171.5 |
|
|
$ |
406.6 |
|
|
$ |
429.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Pretax margin |
|
|
(10.3 |
)% |
|
|
(0.1 |
)% |
|
|
1.5 |
% |
|
|
5.2 |
% |
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment (losses) |
|
|
(20.0 |
)% |
|
|
(9.9 |
)% |
|
|
(6.5 |
)% |
|
|
(3.3 |
)% |
Plus: Purchase-related intangible amortization |
|
|
0.5 |
% |
|
|
0.6 |
% |
|
|
0.5 |
% |
|
|
0.6 |
% |
Adjusted pretax margin |
|
|
10.2 |
% |
|
|
10.4 |
% |
|
|
8.5 |
% |
|
|
9.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net (loss) income |
|
$ |
(104.0 |
) |
|
$ |
(1.7 |
) |
|
$ |
58.7 |
|
|
$ |
182.7 |
|
Non-GAAP adjustments, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment losses |
|
|
(236.6 |
) |
|
|
(122.7 |
) |
|
|
(239.4 |
) |
|
|
(123.5 |
) |
Plus: Purchase-related intangible amortization |
|
|
5.8 |
|
|
|
7.2 |
|
|
|
19.3 |
|
|
|
21.7 |
|
Adjusted net income |
|
$ |
138.4 |
|
|
$ |
128.2 |
|
|
$ |
317.4 |
|
|
$ |
327.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Earnings per diluted share (EPS) |
|
$ |
(1.00 |
) |
|
$ |
(0.02 |
) |
|
$ |
0.56 |
|
|
$ |
1.75 |
|
Non-GAAP adjustments, net of tax: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment losses |
|
|
(2.28 |
) |
|
|
(1.17 |
) |
|
|
(2.30 |
) |
|
|
(1.18 |
) |
Plus: Purchase-related intangible amortization |
|
|
0.06 |
|
|
|
0.07 |
|
|
|
0.18 |
|
|
|
0.21 |
|
Adjusted EPS |
|
$ |
1.34 |
|
|
$ |
1.22 |
|
|
$ |
3.04 |
|
|
$ |
3.14 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Purchase-related intangible amortization includes amortization of noncompete agreements, |
|
|||||||||||||||
customer relationships, and trademarks acquired in business combinations. |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Totals may not sum due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|||||||||||||||
First American Financial Corporation |
|
|||||||||||||||
Reconciliation of Non-GAAP Financial Measures |
|
|||||||||||||||
(in millions except margin, unaudited) |
|
|||||||||||||||
By Segment |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Title Insurance and Services Segment |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total revenues |
|
$ |
1,290.3 |
|
|
$ |
1,524.4 |
|
|
$ |
4,132.0 |
|
|
$ |
4,403.7 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment losses |
|
|
(308.0 |
) |
|
|
(15.6 |
) |
|
|
(283.1 |
) |
|
|
(6.2 |
) |
Adjusted total revenues |
|
$ |
1,598.3 |
|
|
$ |
1,540.0 |
|
|
$ |
4,415.1 |
|
|
$ |
4,409.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Pretax (loss) income |
|
$ |
(130.3 |
) |
|
$ |
160.3 |
|
|
$ |
119.8 |
|
|
$ |
434.2 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment losses |
|
|
(308.0 |
) |
|
|
(15.6 |
) |
|
|
(283.1 |
) |
|
|
(6.2 |
) |
Plus: Purchase-related intangible amortization |
|
|
7.7 |
|
|
|
9.6 |
|
|
|
25.3 |
|
|
|
28.8 |
|
Adjusted pretax income |
|
$ |
185.4 |
|
|
$ |
185.5 |
|
|
$ |
428.2 |
|
|
$ |
469.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Pretax margin |
|
|
(10.1 |
)% |
|
|
10.5 |
% |
|
|
2.9 |
% |
|
|
9.9 |
% |
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment losses |
|
|
(21.2 |
)% |
|
|
(0.9 |
)% |
|
|
(6.2 |
)% |
|
|
(0.1 |
)% |
Plus: Purchase-related intangible amortization |
|
|
0.5 |
% |
|
|
0.6 |
% |
|
|
0.6 |
% |
|
|
0.6 |
% |
Adjusted pretax margin |
|
|
11.6 |
% |
|
|
12.0 |
% |
|
|
9.7 |
% |
|
|
10.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Home Warranty Segment |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total revenues |
|
$ |
110.9 |
|
|
$ |
108.2 |
|
|
$ |
322.9 |
|
|
$ |
318.4 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment gains (losses) |
|
|
0.5 |
|
|
|
(0.7 |
) |
|
|
1.5 |
|
|
|
0.2 |
|
Adjusted total revenues |
|
$ |
110.4 |
|
|
$ |
108.9 |
|
|
$ |
321.4 |
|
|
$ |
318.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Pretax income |
|
$ |
9.0 |
|
|
$ |
9.4 |
|
|
$ |
45.8 |
|
|
$ |
39.6 |
|
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment gains (losses) |
|
|
0.5 |
|
|
|
(0.7 |
) |
|
|
1.5 |
|
|
|
0.2 |
|
Adjusted pretax income |
|
$ |
8.5 |
|
|
$ |
10.1 |
|
|
$ |
44.3 |
|
|
$ |
39.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Pretax margin |
|
|
8.1 |
% |
|
|
8.7 |
% |
|
|
14.2 |
% |
|
|
12.4 |
% |
Non-GAAP adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Less: Net investment gains (losses) |
|
|
0.4 |
% |
|
|
(0.6 |
)% |
|
|
0.4 |
% |
|
|
--- |
% |
Adjusted pretax margin |
|
|
7.7 |
% |
|
|
9.3 |
% |
|
|
13.8 |
% |
|
|
12.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Purchase-related intangible amortization includes amortization of noncompete agreements, |
|
|||||||||||||||
customer relationships, and trademarks acquired in business combinations. |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Totals may not sum due to rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
||||
First American Financial Corporation |
|
|||||||||||||||
Expense and Success Ratio Reconciliation |
|
|||||||||||||||
Title Insurance and Services Segment |
|
|||||||||||||||
($ in millions, unaudited) |
|
|||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
Total revenues |
|
$ |
1,290.3 |
|
|
$ |
1,524.4 |
|
|
$ |
4,132.0 |
|
|
$ |
4,403.7 |
|
Less: Net investment losses |
|
|
(308.0 |
) |
|
|
(15.6 |
) |
|
|
(283.1 |
) |
|
|
(6.2 |
) |
Net investment income |
|
|
136.5 |
|
|
|
141.7 |
|
|
|
378.9 |
|
|
|
408.2 |
|
Premiums retained by agents |
|
|
546.7 |
|
|
|
531.4 |
|
|
|
1,486.7 |
|
|
|
1,496.8 |
|
Net operating revenues |
|
$ |
915.1 |
|
|
$ |
866.9 |
|
|
$ |
2,549.5 |
|
|
$ |
2,504.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Personnel and other operating expenses |
|
$ |
743.5 |
|
|
$ |
711.7 |
|
|
$ |
2,158.9 |
|
|
$ |
2,122.7 |
|
Ratio (% net operating revenues) |
|
|
81.2 |
% |
|
|
82.1 |
% |
|
|
84.7 |
% |
|
|
84.7 |
% |
Ratio (% total revenues) |
|
|
57.6 |
% |
|
|
46.7 |
% |
|
|
52.2 |
% |
|
|
48.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Change in net operating revenues |
|
$ |
48.2 |
|
|
|
|
|
$ |
44.6 |
|
|
|
|
||
Change in personnel and other operating expenses |
|
|
31.8 |
|
|
|
|
|
|
36.2 |
|
|
|
|
||
Success Ratio(1) |
|
|
66 |
% |
|
|
|
|
|
81 |
% |
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(1) Change in personnel and other operating expenses divided by change in net operating revenues. |
|
|||||||||||||||
First American Financial Corporation |
|
|||||||||||||||||||
Supplemental Direct Title Insurance Order Information(1) |
|
|||||||||||||||||||
(unaudited) |
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
Q324 |
|
|
Q224 |
|
|
Q124 |
|
|
Q423 |
|
|
Q323 |
|
|||||
Open Orders per Day |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Purchase |
|
|
1,428 |
|
|
|
1,592 |
|
|
|
1,498 |
|
|
|
1,105 |
|
|
|
1,461 |
|
Refinance |
|
|
502 |
|
|
|
378 |
|
|
|
332 |
|
|
|
325 |
|
|
|
356 |
|
Refinance as % of residential orders |
|
|
26 |
% |
|
|
19 |
% |
|
|
18 |
% |
|
|
23 |
% |
|
|
20 |
% |
Commercial |
|
|
398 |
|
|
|
395 |
|
|
|
416 |
|
|
|
349 |
|
|
|
399 |
|
Default and other |
|
|
267 |
|
|
|
286 |
|
|
|
263 |
|
|
|
231 |
|
|
|
280 |
|
Total open orders per day |
|
|
2,595 |
|
|
|
2,650 |
|
|
|
2,508 |
|
|
|
2,010 |
|
|
|
2,497 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Closed Orders per Day |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Purchase |
|
|
1,120 |
|
|
|
1,177 |
|
|
|
939 |
|
|
|
930 |
|
|
|
1,141 |
|
Refinance |
|
|
314 |
|
|
|
265 |
|
|
|
240 |
|
|
|
221 |
|
|
|
280 |
|
Refinance as % of residential orders |
|
|
22 |
% |
|
|
18 |
% |
|
|
20 |
% |
|
|
19 |
% |
|
|
20 |
% |
Commercial |
|
|
225 |
|
|
|
236 |
|
|
|
231 |
|
|
|
252 |
|
|
|
236 |
|
Default and other |
|
|
241 |
|
|
|
271 |
|
|
|
247 |
|
|
|
219 |
|
|
|
249 |
|
Total closed orders per day |
|
|
1,900 |
|
|
|
1,948 |
|
|
|
1,656 |
|
|
|
1,623 |
|
|
|
1,905 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Average Revenue per Order (ARPO)(2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Purchase |
|
$ |
3,572 |
|
|
$ |
3,605 |
|
|
$ |
3,360 |
|
|
$ |
3,421 |
|
|
$ |
3,474 |
|
Refinance |
|
|
1,291 |
|
|
|
1,206 |
|
|
|
1,151 |
|
|
|
1,284 |
|
|
|
1,227 |
|
Commercial |
|
|
13,194 |
|
|
|
11,720 |
|
|
|
9,989 |
|
|
|
11,001 |
|
|
|
10,763 |
|
Default and other |
|
|
355 |
|
|
|
433 |
|
|
|
363 |
|
|
|
421 |
|
|
|
469 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Total ARPO |
|
$ |
3,926 |
|
|
$ |
3,818 |
|
|
$ |
3,516 |
|
|
$ |
3,899 |
|
|
$ |
3,653 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Business Days |
|
|
64 |
|
|
|
64 |
|
|
|
62 |
|
|
|
62 |
|
|
|
63 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
(1) |
|
|||||||||||||||||||
(2) Average revenue per order (ARPO) defined as direct premiums and escrow fees divided by closed title orders. |
|
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Totals may not sum due to rounding. |
|
|||||||||||||||||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20241023579032/en/
Media Contact:
Marcus Ginnaty
Corporate Communications
First American Financial Corporation
714-250-3298
Investor Contact:
Craig Barberio
Investor Relations
First American Financial Corporation
714-250-5214
Source: First American Financial Corporation
FAQ
What was First American Financial's (FAF) earnings per share in Q3 2024?
How much were First American Financial's (FAF) investment losses in Q3 2024?
What was First American Financial's (FAF) commercial revenue growth in Q3 2024?
How much did First American Financial (FAF) spend on share repurchases in Q3 2024?
