$3.95 billion homebuilder D.R. Horton (>DHI), the largest by market cap among the group that includes Pulte Homes (PHM), Toll Brothers (TOL), and Lennar (LEN), is rising after beating sales expectations by 15% for its fiscal Q3 ended in June, it reported this morning, and seeing a big jump in sales orders from the March quarter.
Revenue fell 36%, year over year, to $914 million, while the company recorded a $110.8 million inventory impairment cost on the homes it holds, for a net loss of 45 cents per share. That compares to expectations for $792 million and a net loss of 23 cents per share.
“Our net sales orders in the June quarter reflected a 22% sequential increase from our March quarter which was stronger than our usual seasonal trend,” said chairman and CEO Donald Horton in the company’s earnings release. “However, market conditions in the homebuilding industry are still challenging, characterized by rising foreclosures, high inventory levels of available homes, increasing unemployment, tight credit for homebuyers and weak consumer confidence.”
On a conference call with analysts, management emphasized that the pace of sales decline year over year was slowing and that pricing was firming up. Average sales prices for the quarter were down 7% from the year-earlier period, at $208,100, but up from the $203,000 of the March quarter.
“Returning to profitability is our No. 1 goal for fiscal 2010,” said management. The company said it had spent $225 million on land lot purchases this year and expected to spend much less than the $500 million originally forecast for the year.
The company declared a quarterly dividend of 36 cents, the same as the last 3 quarters.
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