Company Quick10K Filing
First American Financial
Price57.94 EPS5
Shares114 P/E11
MCap6,590 P/FCF11
Net Debt-1,711 EBIT746
TEV4,879 TEV/EBIT7
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-03-31 Filed 2020-04-29
10-K 2019-12-31 Filed 2020-02-18
10-Q 2019-09-30 Filed 2019-10-24
10-Q 2019-06-30 Filed 2019-07-25
10-Q 2019-03-31 Filed 2019-04-25
10-K 2018-12-31 Filed 2019-02-20
10-Q 2018-09-30 Filed 2018-10-25
10-Q 2018-06-30 Filed 2018-07-26
10-Q 2018-03-31 Filed 2018-04-26
10-K 2017-12-31 Filed 2018-02-16
10-Q 2017-09-30 Filed 2017-10-26
10-Q 2017-06-30 Filed 2017-07-27
10-Q 2017-03-31 Filed 2017-04-27
10-K 2016-12-31 Filed 2017-02-17
10-Q 2016-09-30 Filed 2016-10-20
10-Q 2016-06-30 Filed 2016-07-21
10-Q 2016-03-31 Filed 2016-04-21
10-K 2015-12-31 Filed 2016-02-19
10-Q 2015-09-30 Filed 2015-10-22
10-Q 2015-06-30 Filed 2015-07-23
10-Q 2015-03-31 Filed 2015-04-23
10-K 2014-12-31 Filed 2015-02-23
10-Q 2014-09-30 Filed 2014-10-23
10-Q 2014-06-30 Filed 2014-07-24
10-Q 2014-03-31 Filed 2014-04-24
10-K 2013-12-31 Filed 2014-02-25
10-Q 2013-09-30 Filed 2013-10-24
10-Q 2013-06-30 Filed 2013-07-25
10-Q 2013-03-31 Filed 2013-04-26
10-K 2012-12-31 Filed 2013-02-28
10-Q 2012-09-30 Filed 2012-10-26
10-Q 2012-06-30 Filed 2012-07-30
10-Q 2012-03-31 Filed 2012-05-01
10-K 2011-12-31 Filed 2012-02-27
10-Q 2011-09-30 Filed 2011-11-02
10-Q 2011-06-30 Filed 2011-08-02
10-Q 2011-03-31 Filed 2011-05-02
10-K 2010-12-31 Filed 2011-03-01
10-Q 2010-09-30 Filed 2010-11-01
10-Q 2010-06-30 Filed 2010-08-09
10-Q 2010-03-31 Filed 2010-05-28
8-K 2020-05-15 Enter Agreement, Off-BS Arrangement, Other Events, Exhibits
8-K 2020-05-08 Enter Agreement, Exhibits
8-K 2020-05-05 Enter Agreement, Shareholder Vote, Exhibits
8-K 2020-04-23 Earnings, Exhibits
8-K 2020-02-13 Earnings, Exhibits
8-K 2019-10-24 Earnings, Exhibits
8-K 2019-07-25 Earnings, Exhibits
8-K 2019-05-28 Regulation FD, Exhibits
8-K 2019-05-07 Shareholder Vote
8-K 2019-04-30 Enter Agreement, Leave Agreement, Off-BS Arrangement
8-K 2019-04-25 Earnings, Exhibits
8-K 2019-02-14 Earnings, Exhibits
8-K 2018-10-25 Earnings, Exhibits
8-K 2018-07-26 Earnings, Exhibits
8-K 2018-05-08 Officers, Shareholder Vote, Exhibits
8-K 2018-04-26 Earnings, Exhibits
8-K 2018-02-08 Earnings, Exhibits

FAF 10Q Quarterly Report

Part I: Financial Information
Item 1.Financial Statements.
Note 1 - Basis of Condensed Consolidated Financial Statements
Note 2 - Escrow Deposits, Like - Kind Exchange Deposits and Trust Assets
Note 3 - Debt and Equity Securities
Note 4 - Credit Losses - Financial Assets and Off - Balance Sheet Credit Exposures
Note 5 - Goodwill
Note 6 - Other Intangible Assets
Note 7 - Reserve for Known and Incurred But Not Reported Claims
Note 8 - Income Taxes
Note 9 - Earnings per Share
Note 10 - Employee Benefit Plans
Note 11 - Fair Value Measurements
Note 12 - Share - Based Compensation
Note 13 - Stockholders' Equity
Note 14 - Accumulated Other Comprehensive Income (Loss) ("Aoci")
Note 15 - Litigation and Regulatory Contingencies
Note 16 - Business Combinations
Note 17 - Segment Information
Note 18 - Coronavirus Pandemic
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
Item 4. Controls and Procedures.
Part Ii: Other Information
Item 1. Legal Proceedings.
Item 1A. Risk Factors.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Item 6. Exhibits.
EX-31.A faf-ex31a_205.htm
EX-31.B faf-ex31b_204.htm
EX-32.A faf-ex32a_203.htm
EX-32.B faf-ex32b_202.htm

First American Financial Earnings 2020-03-31

Balance SheetIncome StatementCash Flow
151296302012201420172020
Assets, Equity
1.71.41.00.70.30.02012201420172020
Rev, G Profit, Net Income
1.20.90.50.2-0.2-0.52012201420172020
Ops, Inv, Fin

faf-10q_20200331.htm
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2020-04-21

 

 

 

 

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended March 31, 2020

 

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ______ to ______

 

Commission file number 001-34580

 

 

 

FIRST AMERICAN FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

26-1911571

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

1 First American Way, Santa Ana, California

 

92707-5913

(Address of principal executive offices)

 

(Zip Code)

(714) 250-3000

(Registrant’s telephone number, including area code)

 

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common stock, $0.00001 par value

 

FAF

 

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes       No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act

 

Large accelerated filer

 

  

Accelerated filer

 

 

 

 

 

Non-accelerated filer

 

  

Smaller reporting company

 

 

 

 

 

 

 

 

Emerging growth company

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

On April 21, 2020 there were 111,421,080 shares of common stock outstanding.

 

 

 

 


 

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

INFORMATION INCLUDED IN REPORT

 

PART I: FINANCIAL INFORMATION

 

 

 

 

 

 

 

 

 

Item 1.

 

Financial Statements (unaudited)

  

 

 

 

 

 

 

 

 

 

 

 

 

A. Condensed Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019

  

 

5

 

 

 

 

 

 

 

 

 

 

B. Condensed Consolidated Statements of Income for the three months ended March 31, 2020 and 2019

 

 

6

 

 

 

 

 

 

 

 

 

 

C. Condensed Consolidated Statements of Comprehensive Income for the three months ended March 31, 2020 and 2019

 

 

7

 

 

 

 

 

 

 

 

 

 

D. Condensed Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2020 and 2019

 

 

8

 

 

 

 

 

 

 

 

 

 

E. Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2020 and 2019

  

 

10

 

 

 

 

 

 

 

 

 

 

F. Notes to Condensed Consolidated Financial Statements

 

 

11

 

 

 

 

 

 

 

 

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

  

 

35

 

 

 

 

 

 

 

 

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

  

 

46

 

 

 

 

 

 

 

 

Item 4.

 

Controls and Procedures

  

 

46

 

 

 

 

 

 

 

 

PART II: OTHER INFORMATION

  

 

 

 

 

 

 

 

 

Item 1.

 

Legal Proceedings

  

 

46

 

 

 

 

 

 

 

 

Item 1A.

 

Risk Factors

  

 

48

 

 

 

 

 

 

 

 

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

  

 

57

 

 

 

 

 

 

 

 

Item 6.

 

Exhibits

  

 

58

 

Items 3 through 5 of Part II have been omitted because they are not applicable with respect to the current reporting period.

 

 


2


 

THIS QUARTERLY REPORT ON FORM 10-Q CONTAINS 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 THE PERFORMANCE OF THE REAL ESTATE MARKETS;

 

VOLATILITY IN THE CAPITAL MARKETS;

 

UNFAVORABLE ECONOMIC CONDITIONS;

 

THE CORONAVIRUS PANDEMIC AND RESPONSES THERETO;

 

IMPAIRMENTS IN THE COMPANY’S GOODWILL OR OTHER INTANGIBLE ASSETS;

 

UNCERTAINTY FROM THE EXPECTED DISCONTINUANCE OF LIBOR AND TRANSITION TO ANY OTHER INTEREST RATE BENCHMARK;

 

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;

 

USE OF SOCIAL MEDIA BY THE COMPANY AND OTHER PARTIES;

 

REGULATION OF TITLE INSURANCE RATES;

 

LIMITATIONS ON ACCESS TO PUBLIC RECORDS AND OTHER DATA;

 

CLIMATE CHANGE, HEALTH CRISES, 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;

 

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;

 

SYSTEMS DAMAGE, FAILURES, INTERRUPTIONS, CYBERATTACKS AND INTRUSIONS, OR UNAUTHORIZED DATA DISCLOSURES;

3


 

 

INNOVATION EFFORTS OF THE COMPANY AND OTHER INDUSTRY PARTICIPANTS AND ANY RELATED MARKET DISRUPTION;

 

ERRORS AND FRAUD INVOLVING THE TRANSFER OF FUNDS;

 

THE COMPANY’S USE OF A GLOBAL WORKFORCE;

 

INABILITY OF THE COMPANY’S SUBSIDIARIES TO PAY DIVIDENDS OR REPAY FUNDS; AND

 

OTHER FACTORS DESCRIBED IN THIS QUARTERLY REPORT ON FORM 10-Q, INCLUDING UNDER THE CAPTION “RISK FACTORS” IN ITEM 1A OF PART II.

 

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.

 

 

4


 

PART I: FINANCIAL INFORMATION

Item 1.Financial Statements.

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Balance Sheets

(in thousands, except par values)

(unaudited)

 

 

March 31,

2020

 

 

December 31,

2019

 

Assets

 

 

 

 

 

 

 

Cash and cash equivalents

$

1,049,985

 

 

$

1,485,959

 

Accounts and accrued income receivable, less allowances of $11,576 and $12,676

 

404,541

 

 

 

324,385

 

Income taxes receivable

 

11,870

 

 

 

10,967

 

Investments:

 

 

 

 

 

 

 

Deposits with banks

 

39,425

 

 

 

44,422

 

Debt securities, includes pledged securities of $92,261 and $91,636 (amortized cost
$5,711,924 and $5,796,755; allowance for credit losses of $7,493 at March 31, 2020)

 

5,839,530

 

 

 

5,913,636

 

Equity securities

 

377,296

 

 

 

392,318

 

Other investments

 

292,726

 

 

 

239,067

 

 

 

6,548,977

 

 

 

6,589,443

 

Secured financings receivable

 

480,160

 

 

 

287,459

 

Property and equipment, net

 

488,490

 

 

 

442,014

 

Operating lease assets

 

295,387

 

 

 

291,385

 

Title plants and other indexes

 

580,255

 

 

 

579,674

 

Deferred income taxes

 

18,283

 

 

 

18,283

 

Goodwill

 

1,381,495

 

 

 

1,150,908

 

Other intangible assets, net

 

183,961

 

 

 

91,833

 

Other assets

 

232,081

 

 

 

246,857

 

 

$

11,675,485

 

 

$

11,519,167

 

Liabilities and Equity

 

 

 

 

 

 

 

Deposits

$

3,431,347

 

 

$

3,337,431

 

Accounts payable and accrued liabilities

 

664,023

 

 

 

820,356

 

Deferred revenue

 

237,500

 

 

 

252,331

 

Reserve for known and incurred but not reported claims

 

1,057,538

 

 

 

1,063,044

 

Income taxes payable

 

36,427

 

 

 

25,475

 

Deferred income taxes

 

266,108

 

 

 

266,108

 

Operating lease liabilities

 

324,804

 

 

 

322,776

 

Secured financings payable

 

441,657

 

 

 

278,412

 

Notes and contracts payable

 

847,159

 

 

 

728,232

 

 

 

7,306,563

 

 

 

7,094,165

 

Commitments and contingencies (Note 15 and Note 18)

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

Preferred stock, $0.00001 par value; Authorized—500 shares;
Outstanding—none

 

 

 

 

 

Common stock, $0.00001 par value; Authorized—300,000 shares;
Outstanding—111,417 shares and 112,476 shares

 

1

 

 

 

1

 

Additional paid-in capital

 

2,247,569

 

 

 

2,300,926

 

Retained earnings

 

2,173,720

 

 

 

2,161,049

 

Accumulated other comprehensive loss

 

(61,945

)

 

 

(41,492

)

Total stockholders’ equity

 

4,359,345

 

 

 

4,420,484

 

Noncontrolling interests

 

9,577

 

 

 

4,518

 

Total equity

 

4,368,922

 

 

 

4,425,002

 

 

$

11,675,485

 

 

$

11,519,167

 

 

See notes to condensed consolidated financial statements.

 

5


 

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Income

(in thousands, except per share amounts)

(unaudited)

 

 

 

Three Months Ended
March 31,

 

 

 

2020

 

 

2019

 

Revenues

 

 

 

 

  

 

 

 

Direct premiums and escrow fees

 

$

620,637

  

 

$

514,202

  

Agent premiums

 

 

599,682

  

 

 

501,537

  

Information and other

 

 

211,512

  

 

 

172,892

  

Net investment income

 

 

45,874

  

 

 

82,268

  

Net realized investment (losses) gains

 

 

(64,762

)

 

 

32,682

 

 

 

 

1,412,943

  

 

 

1,303,581

  

Expenses

 

 

 

 

 

 

 

 

Personnel costs

 

 

429,660

  

 

 

411,612

  

Premiums retained by agents

 

 

475,381

  

 

 

396,607

  

Other operating expenses

 

 

257,240

  

 

 

196,447

  

Provision for policy losses and other claims

 

 

117,477

  

 

 

97,712

  

Depreciation and amortization

 

 

31,449

  

 

 

32,934

  

Premium taxes

 

 

17,315

  

 

 

14,663

  

Interest

 

 

12,097

  

 

 

11,936

  

 

 

 

1,340,619

  

 

 

1,161,911

  

Income before income taxes

 

 

72,324

  

 

 

141,670

  

Income taxes

 

 

8,478

  

 

 

31,866

  

Net income

 

 

63,846

  

 

 

109,804

  

Less: Net income attributable to noncontrolling interests

 

 

642

 

 

 

229

 

Net income attributable to the Company

 

$

63,204

  

 

$

109,575

  

Net income per share attributable to the Company’s stockholders (Note 9):

 

 

 

 

 

 

 

 

Basic

 

$

0.56

  

 

$

0.97

  

Diluted

 

$

0.55

  

 

$

0.97

  

Cash dividends declared per share

 

$

0.44

  

 

$

0.42

  

Weighted-average common shares outstanding (Note 9):

 

 

 

 

 

 

 

 

Basic

 

 

113,556

  

 

 

112,703

  

Diluted

 

 

113,959

  

 

 

113,224

  

 

See notes to condensed consolidated financial statements.

 

 

6


 

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Comprehensive Income

(in thousands)

(unaudited)

 

 

 

Three Months Ended
March 31,

 

 

 

2020

 

 

2019

 

Net income

 

$

63,846

 

 

$

109,804

 

Other comprehensive income (loss), net of tax:

 

 

 

 

 

 

 

 

Unrealized gains on debt securities

 

 

12,619

 

 

 

59,505

 

Unrealized gains on debt securities for which credit-related
portion was recognized in earnings

 

 

85

 

 

 

 

Foreign currency translation adjustment

 

 

(33,556

)

 

 

6,888

 

Pension benefit adjustment

 

 

399

 

 

 

(76

)

Total other comprehensive (loss) income, net of tax

 

 

(20,453

)

 

 

66,317

 

Comprehensive income

 

 

43,393

 

 

 

176,121

 

Less: Comprehensive income attributable to noncontrolling interests

 

 

642

 

 

 

228

 

Comprehensive income attributable to the Company

 

$

42,751

 

 

$

175,893

 

 

See notes to condensed consolidated financial statements.

 

 

7


 

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Stockholders’ Equity

(in thousands)

(unaudited)

 

 

 

First American Financial Corporation Stockholders

 

 

 

 

 

 

 

 

 

Shares

 

  

Common
stock

 

  

Additional
paid-in
capital

 

  

Retained
earnings

 

 

Accumulated
other
comprehensive
loss

 

 

Total
stockholders’
equity

 

 

Noncontrolling
interests

 

 

Total

 

Balance at December 31, 2019

 

 

112,476

 

 

$

1

 

 

$

2,300,926

 

 

$

2,161,049

 

 

$

(41,492

)

 

$

4,420,484

 

 

$

4,518

 

 

$

4,425,002

  

Net income for three months ended March 31, 2020

 

 

 

  

 

 

  

 

 

  

 

63,204

  

 

 

 

 

 

63,204

  

 

 

642

 

 

 

63,846

  

Dividends on common shares

 

 

 

  

 

 

  

 

 

  

 

(49,702

 

 

 

 

 

(49,702

)

 

 

 

 

 

(49,702

)

Purchase of Company shares

 

 

(1,703

)

 

 

 

 

 

(65,785

)

 

 

 

 

 

 

 

 

(65,785

)

 

 

 

 

 

(65,785

)

Shares issued in connection with share-based compensation

 

 

644

  

  

 

 

  

 

(13,547

)

  

 

(831

 

 

 

 

 

(14,378

)

 

 

 

 

 

(14,378

)

Share-based compensation

 

 

 

  

 

 

  

 

25,903

  

  

 

 

 

 

 

 

 

25,903

 

 

 

 

 

 

25,903

 

Net activity related to noncontrolling interests

 

 

 

  

 

 

  

 

72

 

  

 

 

 

 

 

 

 

72

 

 

 

4,417

 

 

 

4,489

 

Other comprehensive loss

 

 

 

  

 

 

  

 

 

  

 

 

 

 

(20,453

)

 

 

(20,453

)

 

 

 

 

 

(20,453

)

Balance at March 31, 2020

 

 

111,417

  

  

$

1

  

  

$

2,247,569

  

  

$

2,173,720

  

 

$

(61,945

 

$

4,359,345

 

 

$

9,577

 

 

$

4,368,922

  

 

See notes to condensed consolidated financial statements.


8


 

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Stockholders’ Equity – (Continued)

(in thousands)

(unaudited)

 

 

 

First American Financial Corporation Stockholders

 

 

 

 

 

 

 

 

 

Shares

 

  

Common
stock

 

  

Additional
paid-in
capital

 

  

Retained
earnings

 

 

Accumulated
other
comprehensive
loss

 

 

Total
stockholders’
equity

 

 

Noncontrolling
interests

 

 

Total

 

Balance at December 31, 2018

 

 

111,496

 

 

$

1

 

 

$

2,258,290

 

 

$

1,644,165

 

 

$

(160,575

)

 

$

3,741,881

 

 

$

3,507

 

 

$

3,745,388

  

Cumulative-effect adjustment

 

 

 

  

 

 

  

 

 

  

 

1,283

  

 

 

 

 

 

1,283

  

 

 

 

 

 

1,283

  

Net income for three months ended March 31, 2019

 

 

 

  

 

 

  

 

 

  

 

109,575

  

 

 

 

 

 

109,575

  

 

 

229

 

 

 

109,804

  

Dividends on common shares

 

 

 

  

 

 

  

 

 

  

 

(47,021

 

 

 

 

 

(47,021

)

 

 

 

 

 

(47,021

)

Purchase of Company shares

 

 

(47

)

 

 

 

 

 

(2,066

)

 

 

 

 

 

 

 

 

(2,066

)

 

 

 

 

 

(2,066

)

Shares issued in connection with share-based compensation

 

 

623

  

  

 

 

  

 

(10,618

)

  

 

(862

 

 

 

 

 

(11,480

)

 

 

 

 

 

(11,480

)

Share-based compensation

 

 

 

  

 

 

  

 

19,597

  

  

 

 

 

 

 

 

 

19,597

 

 

 

 

 

 

19,597

 

Net activity related to noncontrolling interests

 

 

 

  

 

 

  

 

(60

)

  

 

 

 

 

 

 

 

(60

)

 

 

(1,226

)

 

 

(1,286

)

Other comprehensive income (loss)

 

 

 

  

 

 

  

 

 

  

 

 

 

 

66,318

 

 

 

66,318

 

 

 

(1

)

 

 

66,317

 

Balance at March 31, 2019

 

 

112,072

  

  

$

1

  

  

$

2,265,143

  

  

$

1,707,140

  

 

$

(94,257

 

$

3,878,027

 

 

$

2,509

 

 

$

3,880,536

  

 

See notes to condensed consolidated financial statements.

 

 

 

9


 

FIRST AMERICAN FINANCIAL CORPORATION

AND SUBSIDIARY COMPANIES

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

 

 

 

Three Months Ended

March 31,

 

 

 

2020

 

 

2019

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Net income

 

$

63,846

 

 

$

109,804

 

Adjustments to reconcile net income to cash provided by operating activities:

 

 

 

 

 

 

 

 

Provision for policy losses and other claims

 

 

117,477

 

 

 

97,712

 

Depreciation and amortization

 

 

31,449

 

 

 

32,934

 

Amortization of premiums and accretion of discounts on debt securities, net

 

 

9,952

 

 

 

5,464

 

Net realized investment losses (gains)

 

 

64,762

 

 

 

(32,682

)

Share-based compensation

 

 

25,903

 

 

 

19,597

 

Equity in earnings of equity method investments, net

 

 

228

 

 

 

180

 

Dividends from equity method investments

 

 

1,402

 

 

 

545

 

Changes in assets and liabilities excluding effects of acquisitions and noncash transactions:

 

 

 

 

 

 

 

 

Claims paid, including assets acquired, net of recoveries

 

 

(108,538

)

 

 

(99,992

)

Net change in income tax accounts

 

 

5,181

 

 

 

29,186

 

(Increase) decrease in accounts and accrued income receivable

 

 

(45,747

)

 

 

2,543

 

Decrease in accounts payable and accrued liabilities

 

 

(149,960

)

 

 

(118,318

)

Decrease in deferred revenue

 

 

(15,753

)

 

 

(13,447

)

Other, net

 

 

23,952

 

 

 

945

 

Cash provided by operating activities

 

 

24,154

 

 

 

34,471

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Net cash effect of acquisitions/dispositions

 

 

(386,231

)

 

 

(225

)

Net decrease (increase) in deposits with banks

 

 

2,095

 

 

 

(8,824

)

Purchases of debt and equity securities

 

 

(588,327

)

 

 

(727,001

)

Proceeds from sales of debt and equity securities

 

 

211,370

 

 

 

461,447

 

Proceeds from maturities of debt securities

 

 

320,523

 

 

 

136,670

 

Investments in unconsolidated entities

 

 

(44,795

)

 

 

(