D.R. Horton (DHI), the largest U.S. homebuilder, reported a 33% jump in orders as the spring selling season got off to a strong start.
The company reported that net income for its second fiscal quarter ended March 31, 2015 increased 13% to $147.9 million, or $0.40 per diluted share, from $131.0 million, or $0.38 per diluted share in the same quarter of fiscal 2014.
Homebuilding revenue for the second quarter of fiscal 2015 increased 38% to $2.3 billion from $1.7 billion in the same quarter of fiscal 2014. Homes closed in the quarter increased 33% to 8,243 homes, compared to 6,194 homes in the prior year quarter.
For the six months ended March 31, 2015, net income increased 14% to $290.4 million, or $0.79 per diluted share, from $254.1 million, or $0.73 per diluted share in the same period of fiscal 2014. Homebuilding revenue for the six months ended March 31, 2015 increased 38% to $4.6 billion from $3.3 billion in the first six months of fiscal 2014. Homes closed in the six-month period increased 31% to 16,216, compared to 12,382 homes in the same period of fiscal 2014.
“The spring selling season at D.R. Horton is off to a strong start. In the second quarter, the value of our net sales orders, home sales revenue and sales order backlog increased year-over-year by 33%, 38% and 27%, respectively. Our sales increased by double-digit percentages in all three of our brands, reflecting strong performance in our core D.R. Horton communities and the expansion of our luxury brand, Emerald Homes, and our entry-level brand, Express Homes,” said Donald Horton, Chairman of the Board. “Our increasingly diverse product offerings are enabling us to expand our industry-leading market share.
“We also delivered another solid quarter of profitability, highlighted by $230.1 million of pre-tax income, on $2.4 billion of revenues. With 12,177 homes in backlog at March 31, 2015 and a robust community count, finished lot supply and inventory of homes available for sale, we are well-positioned for the second half of the fiscal year. We remain intently focused on growing our revenues and profits at a double-digit pace, while generating improved returns and cash flows," he said.
Net sales orders for the second quarter ended March 31, 2015 increased 30% to 11,135 homes and 33% in value to $3.2 billion, compared to 8,569 homes and $2.4 billion in the prior year quarter.
The company’s cancellation rate (cancelled sales orders divided by gross sales orders) for the second quarter of fiscal 2015 was 20%. Net sales orders for the first six months of fiscal 2015 increased 32% to 18,505 homes from 14,023 homes in the first six months of fiscal 2014 and the value of net sales orders increased 35% to $5.3 billion from $3.9 billion.
The company’s sales order backlog of homes under contract at March 31, 2015 increased 21% to 12,177 homes and 27% in value to $3.6 billion, compared to 10,059 homes and $2.8 billion at March 31, 2014.
The company ended the quarter with $665.8 million of homebuilding unrestricted cash and net homebuilding debt to total capital of 34.7%. Net homebuilding debt to total capital consists of homebuilding notes payable net of cash divided by total equity plus homebuilding notes payable net of cash.
The company has declared a quarterly cash dividend of $0.0625 per common share. The dividend is payable on May 27, 2015 to stockholders of record on May 15, 2015.