Index First American Profile Financial Highlights Letter to Stockholders First American's Strength in Numbers Title Information and Services Real Estate Information and Services Consumer Information and Services Management's Discussion and Analysis Selected Financial Data Common Stock Prices and Dividends Quarterly Financial Data Consolidated Balance Sheets Consolidated Statements of Income Consolidated Statements of Stockholders' Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements Report of Independent Accountants Officers Board of Directors Primary Companies Stockholder Information Back Cover

title information and services (cont.)


Geographic Expansion
Already established in every state, First American Title continued its expansion with 12 acquisitions last year that added 53 offices to our national network. Of that number, 40 were added when we completed the acquisition of Security First Title Affiliates in Florida, in which First American had previously held a minority interest. Today, approximately 1,100 direct-operation offices and thousands of agents provide First American Title services nationwide.

The Title Company also advanced its international growth strategy by becoming the first title insurer licensed in South Korea and Hong Kong. With offices in Seoul, Hong Kong, and Beijing, the company is positioned to take advantage of huge growth potential in the Asian market. Our Canadian title operations, that nation’s largest, reported a revenue increase of 46 percent in 2001. The company expanded its business in Australia, where we remain the only licensed title insurer, and grew in the United Kingdom, as well. Our operations outside the U.S. generated $65 million in revenues for the Company in 2001.

Market Share Growth
First American Title Insurance Company was the only national firm in the title industry to realize a market share increase between the beginning of 2000 and the start of 2001, according to statistics provided by the American Land Title Association in mid-2001.

The company continues to work toward the increase of its overall market share through a variety of specific market-directed efforts. Its recently developed FASTRealty technology and service system is designed to further serve residential resale market professionals. And, in late 2001, the company acquired CloseYourDeal.com, the transaction management platform of Realty Plus Online, Inc. Initiatives currently underway are strengthening relationships with those involved in the mortgage loan default process, as well. Plus, the company’s National Homebuilder Services group continued its efforts to efficiently and expertly serve homebuilders and developers.

The Title Company’s National Commercial Services division, which works with major commercial groups to complete transactions reaching into the hundreds of millions of dollars, restructured its operations in 2001. The division combined the skills of those within its National Accounts offices with those of its local commercial professionals across the country by forming 14 commercial service centers. The centers, located in major metropolitan areas, are staffed by experts in commercial property transactions, who provide rapid, efficient service in these key commercial areas and throughout the United States. Reliable customer service—a key to market penetration— can now be provided more efficiently as this group continues to grow its market share in this segment.

The Title Company’s claims-paying ability also continued to be strongly rated, as it received an “A+” rating from A.M. Best Company; an “A” rating from Fitch IBCA, Duff & Phelps; an “A-” rating from Standard & Poor’s; an “A double prime” rating from Demotech, Inc.; and an “A3” (Exceptional) rating from Moody’s Investors Service.