D.R. Horton 2Q Profit Tumbles 85 Percent
Thursday April 19, 7:21 am ET
D.R. Horton 2nd-Quarter Earnings Plunge on Sales Decline, Charges
FORT WORTH, Texas (AP) -- D.R. Horton, one of the nation's largest homebuilders, said Thursday its fiscal second-quarter earnings plunged 85 percent, as the prolonged housing slump sent sales tumbling and forced the company to abandon deposits on some options to buy land.
Net income for the quarter ended March 31 fell to $51.7 million, or 16 cents per share, from $352.8 million, or $1.11 per share, a year ago. The latest quarter included charges of 13 cents per share for inventory impairments and 3 cents per share to write off deposits on land options it won't pursue.
Analysts, whose estimates typically exclude items, were looking for profit of 27 cents per share, according to a Thomson Financial poll.
Homebuilding revenue sank 26 percent to $2.61 billion from $3.53 billion, as the number of homes closed dropped 22 percent to 9,792. The result fell far short of Wall Street's expectation for revenue of $2.79 billion.
Sales have come under pressure as demand for new homes has slumped, forcing companies to slash prices or offer incentives to move inventory.
"Market conditions in the homebuilding industry continue to be challenging in most of our markets as inventory levels of both new and existing homes remain high, and further increases in the use of sales incentives continue to put pressure on profit margin," Chairman Donald Horton said in a statement.
The company's sales backlog of homes under contract at March 31 was 16,885 homes, or $4.8 billion, compared with 24,017 homes, or $7.1 billion, a year ago.
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Howz they gonna spin this? |
