|
FINANCIAL RESULTS
The Property Information segment realized increases in both revenues and income before
income taxes and minority interests in each quarter of 2002 as compared to the same
quarters of the prior year. In the second half of the year, the group more than doubled its
operating revenues as compared to 2001. For the full year, the segment's activities produced
operating revenues of $259.3 million, an increase of 23 percent from the previous year, and
income before income taxes and minority interests totaling nearly $71.5 million, a little more
than twice the previous year's results. A large share of this segment's increased revenues can be
attributed to the continued effects of acquisitions and the geographic expansion of its databases.
The group's rising income has been largely the result of ongoing operational efficiency initiatives.
Although the real estate market's strength played a role in this group's 2002 success, short-term market fluctuations affect this
segment's results less than some of First American's other businesses. Whereas many of First American's real estate-related
businesses are transaction-based, the Property Information companies provide many of their services under long-term contracts.
This group's products are routinely used during downturns in the real estate cycles for customer acquisition and retention programs.
Segments outside the real estate arena further contribute to revenue stability.
SEGMENT ACTIVITY
In 2002, this segment continued to operate under the plan set forth four years ago in which growth is generated via geographic
expansion of databases, technology development and refinement, acquisitions, and international processing.
Strategic acquisitions in recent years, designed to extend product lines and expand market share, have positioned the segment solidly
as the industry leader. The group today boasts one of the largest online interactive databases in the nation — a source that now includes
data from 92 percent of all U.S. real estate transactions. Aggressive geographic expansion of data continued in 2002.
The segment also continued to leverage its technology infrastructure. First American Real Estate Solutions fully integrated its
technology with that of Transamerica Corporation's Intellitech real estate information operation, with which it formed a limited
partnership in 2000. New products also were integrated into Web-based systems to provide simpler distribution and more economical
delivery. This technology leverage and Web-migration strategy has been deployed in the other businesses within the segment.
MARKET GROWTH
The four core companies in this segment continue to hold impressive market shares and industry positions. First American Real
Estate Solutions commands the number-one status as the leading provider of real estate information used to locate and
value properties, determine ownership records, and assess property characteristics.
eAppraiseIT, LLC grew substantially in the second quarter of the year as a joint venture was formed
with LandAmerica Financial Group, Inc. The agreement brought together LandAmerica's OneStop®
 appraisal production division and First American's eAppraiseIT to create the nation's largest
independent provider of real estate valuation services. The entity is majority owned by First
American. In the third quarter, eAppraiseIT, LLC acquired Source One Services Corporation, a
nationwide provider of broker price opinions (BPO). BPOs are the nation's fastest-growing real
estate valuation products, and have become critical to the mortgage lending and default markets.
Both the eAppraiseIT/LandAmerica joint venture and Source One Services were immediately accretive
to First American's earnings, and division leaders have high expectations for this growing industry.
Data Trace, which boasts the world's most advanced and comprehensive title information delivery system, remained market
share leader in its industry in 2002. This group continued to grow its data geographically to meet its goal of creating a national
footprint. Data Tree LLC also retained its number-one position among its competitors. This company has amassed the nation's
largest database of imaged property records — more than 1 billion — to help the title industry and others streamline their systems.
|
|
|
|
