Q2 2024 First American Financial Corp Earnings Call Transcript
Key Points
- Total revenue for the second quarter was $1.6 billion, with adjusted earnings per diluted share at $1.27.
- The Home Warranty segment delivered strong results with an adjusted pretax margin of 15.2%, up from 12.9% in 2023.
- The company successfully launched a pilot for automated underwriting for purchase transactions, which could enhance operational efficiency.
- Investment income was $126 million in the second quarter, driven by higher interest income from the company's warehouse lending business.
- First American Financial Corp (FAF) repurchased 752,000 shares for a total of $41 million, indicating strong capital management.
- Title segment revenue was down 1% compared to the same quarter of 2023, indicating a challenging market environment.
- Closed refinance orders were down 5% in the second quarter, reflecting high mortgage rates and affordability issues.
- Commercial revenue saw a 1% decline over last year, with closed commercial orders falling 2%.
- Investment income declined by $16 million compared to the same quarter last year, primarily due to lower average interest-bearing escrow and tax-deferred property exchange balances.
- The provision for policy losses and other claims was $35 million in the second quarter, reflecting an ultimate loss rate of 3.75% for the current policy year.
Greetings, and welcome to the First American Financial Corporation Second Quarter Earnings Conference Call. (Operator Instructions). A copy of today's press release is available on First American's website at www.firstam.com/investor.
Please note that the call is being recorded and will be available for replay from the company's investor website and for a short time by dialing (877) 660-6853 or (201) 612-7415, and enter the conference ID 13747727.
We will now turn the call over to Craig Barberio, Vice President, Investor Relations, to make an introductory statement.
Good morning, everyone, and welcome to First American's earnings conference call for the second quarter of 2024. Joining us today on the call will be our Chief Executive Officer, Ken DeGiorgio, and Mark Seaton, Executive Vice President and Chief Financial Officer.
Some of the statements made today may contain forward-looking statements
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