First American Profit Leaps 44 Percent
April 28, 2005
First American First-Quarter Earnings Jump 44 Percent, Outpacing Wall Street Forecasts
SANTA ANA, Calif. (AP) -- First American Corp., an insurance company and provider of financial data, said Wednesday that first-quarter profit jumped 44 percent as cost controls helped push results above Wall Street expectations.
The company's shares rose $1.55, or 4.6 percent, to $35.10 in afternoon trading on the New York Stock Exchange.
First American earned $79.2 million, or 83 cents per share, up from $55 million, or 62 cents per share, a year ago.
Revenue grew 16 percent to $1.7 billion from $1.47 billion, driven by an 18 percent jump in sales at First American's title insurance and services business to $1.24 billion. The company's information technology unit -- which provides services such as mortgage and credit information -- saw its sales grow 7 percent to $403 million.
Analysts surveyed by Thomson Financial were looking for earnings of 77 cents per share.
"We were able to exercise solid expense controls and improve our margins during a slower mortgage-activity period," said Chairman and Chief Executive Parker S. Kennedy. "New order counts in February and March were unseasonably strong in our direct title operations, which should yield good second quarter results."
The company also acquired United General Title Insurance Co. during the quarter.
Looking ahead, First American said it expects technology solutions, centralization, offshore processing, bundling and acquisitions to drive growth for the year.
Copyright Associated Press