The Housing Chronicles Blog: DR Horton, Richmond American, M/I Homes report results

Thursday, February 7, 2008

DR Horton, Richmond American, M/I Homes report results

Despite the recent rise in some homebuilding stocks, the market is expected to remain challenging throughout 2008. From a MarketWatch article, first up is DR Horton:

DHI 15.04, +0.23, +1.6%) before the opening bell said it swung to a fiscal first-quarter loss for the three months ended Dec. 31 of $128.8 million, or 41 cents a share. The results included $245.5 million of inventory impairments and charges for abandoned land options.

Net sales orders for the quarter plunged to 4,245 homes from 8,771 a year earlier. Highlighting weak buyer sentiment, the cancellation rate for the fiscal first quarter was 44%, D.R. Horton said. The average selling price of a home dropped about 9% from a year earlier.
``Market conditions remained challenging in our December quarter as inventory levels of both new and existing homes remained high while pricing remained very competitive," said Donald Horton, chairman, in a statement.
"Lending standards continue to be more restrictive than during the previous year, and buyers continued to approach the home buying decision cautiously," he said. "We expect the housing environment to remain challenging."

Next up, MDC Holdings, operating at Richmond American:

Revenue dropped to $785 million from $1.34 billion, and the Denver-based builder took pretax charges of $175.2 million for asset impairments and $7.8 million for write-offs of deposits and pre-acquisition costs associated with land option contracts the company does not intend to pursue.
It had orders, net of cancellations, for 748 homes with an estimated sales value of $187 million during the 2007 fourth quarter, compared with net orders for 1,571 homes with an estimated sales value of $515 million during the same period in 2006.

Finally, M/I Homes, which builds mostly in the east:

MHO 16.21, -0.04, -0.2%) fourth-quarter loss widened to $68.5 million, or $5.06 a share, from a year-earlier loss of $11 million, or 79 cents a share, due to various charges totaling $4.90 a share.

Results from the latest quarter included land-related impairment and abandonment charges of $104.9 million, joint venture investment write-offs of $4.3 million and severance costs of $3.1 million, M/I Homes said Thursday.

The company reported a loss from continuing operations of $3.20 a share, compared with 99 cents a share, a year earlier. The Columbus, Ohio, home builder said revenue declined 23% to $340.5 million from $443 million.

The company delivered 1,042 homes during the fourth quarter, compared with 1,363 homes a year earlier.

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