Beazer narrows loss as closings and new orders rise
Atlanta homebuilder Beazer Homes USA (BZH) narrowed its net loss for its fiscal second quarter as new orders and home closings increased.
Beazer reported a net loss of $39.9 million for the quarter ended March 31 compared with a net loss of $53.8 million in the year-ago period. That equates to a loss of 51 cents a share for the quarter, down from loss of 73 cents a share in the year-ago period.
Its net loss from continuing operations fell to $37.9 million, or a loss of 48 cents a share. Beazer missed the consensus estimate from analysts of a loss of 43 cents a share, according to Thomson Reuters.
“We generated significant year-over-year increases in new home orders and home closings, reflecting both the initial operational benefits of our path-to-profitability strategies and gradually improving conditions in the housing market," said Allan Merrill, CEO. "We remain hopeful, but cautious, about the prospects for a sustained market recovery, as a number of factors continue to pose challenges for prospective homebuyers."
The company had new orders of 1,512 homes, a 29% increase from the comparable period, and 844 home closings, up from 563.
It reported a backlog of 1,975 homes with a sales value of $465 million, compared to 1,396 homes with a sales value of $335.2 million as of March 31, 2011.
Beazer reported a gross profit margin of 10.5%, compared to a negative 1.1% for the quarter ended March 2011. Margins were impacted by $1.2 million and $17.8 million in fiscal 2012 and fiscal 2011, respectively, for impairments and option contract abandonments.
Still, cancellations rates were high, 22.5%, up from 20% in the year-ago quarter.
Revenue was $191.6 million, compared to $125.7 million in fiscal 2011.
Homebuilding gross profit margin, excluding impairments and abandonments was 10.9%, compared to 12.4% in the year-ago period.