First American Financial Posts Record Earnings : Profits: The company attributes the surge to last year’s mortgage refinancing frenzy and an improving economy.

First American Financial Corp., powered by last summer’s wave of mortgage refinancing in California and an improving economy elsewhere, reported record earnings and revenue for 1993 as well as for the fourth quarter.

First American, which operates the nation’s second-largest title insurance company, posted net income of $66.3 million last year, a 53% increase over earnings of $43.3 million the previous year.

Earnings were so strong that net income per share rose to $5.84 a share from $4.55 even though the average number of shares increased 19%.

Last year’s profit included an income tax benefit of $4.2 million, equal to 37 cents a share, as a result of a new accounting standard. Revenue increased to $1.4 billion last year from $1.1 billion.

For the past two years, First American has made strategic acquisitions and other additions to the company’s services as it prepared itself for a rebound in the real estate market.

“The year produced record numbers of refinance closings, which benefited both our title insurance and real estate information services segments,” said Parker S. Kennedy, the company’s president.

For the fourth quarter, the company earned $20.5 million, or $1.80 a share, a 67% increase over earnings of $12.3 million, or $1.10 a share, the previous year. Revenue grew 25% to $409.2 million last year from $326.4 million.

First American offers title insurance through First American Title Insurance Co., a 104-year-old company that has a network of more than 300 offices and 4,000 agents throughout the United States, and in the Bahamas, Bermuda, Canada, Guam, Mexico, Puerto Rico, the U.S. Virgin Islands and the United Kingdom.

Related First American companies provide tax monitoring, home warranty, credit reporting and property information services for both buyers and lenders. The company also operates First American Trust Co., a trust and banking business in Southern California.

A New High at First American

In the fourth quarter ended Dec. 31, First American Financial Corp. reported net income of $20.5 million on earnings of $409 million. That helped boost the company’s net income to $66 million, highest in the company’s 104-year history. Figures in millions of dollars, except per-share data:

4th quarter 4th quarter 12 months 12 months 1992 1993 1992 1993 Revenue $326.45 $409.15 $1,115.47 $1,398.43 Net income (loss) 12.29 20.51 43.26 66.29 Per share (loss) 1.10 1.80 4.55 5.84

Source: First American Financial Corp.

Researched by JANICE L. JONES / Los Angeles Times