D.R. Horton posts $28.7 million profit for fiscal 3Q
Homebuilder D.R. Horton Inc. (DHI) beat analysts' estimates Thursday, posting a profit of $28.7 million, or 9 cents per share, for its fiscal third quarter. Income for the three months ended June 30 beat the average analyst estimate of 6 cents a share. The company's third-quarter earnings are lower than the $50.5 million, or 16 cents per share, of a year earlier, as the company closed on fewer homes. D.R. Horton closed 4,555 sales in the third quarter, down from 6,805 last year. Total homebuilding revenue fell to $975.4 million from $1.4 billion, while D.R. Horton's order cancellation rate climbed to 27% in the third quarter. "Market conditions in the home building industry are still challenging, with high foreclosures, significant existing home inventory, high unemployment, tight mortgage lending standards and weak consumer confidence, which are all contributing to weak housing demand," said Donald Horton, chairman of the nation's largest homebuilder. "However, housing affordability remains near record highs, interest rates are favorable and new home inventory is still very low." The company repaid the remaining $70.1 million principal on its 6% senior notes and redeeming the remaining $112.3 million of its 5.375% senior notes due in 2012 during the quarter. At the end of the quarter, the firm had $1.1 billion in unrestricted cash and marketable securities. "We are proud of the results our team achieved this quarter," Horton said. "Sequentially, our home building revenues grew $242 million, home sales gross margins improved by 30 basis points and home building SG&A decreased by approximately $10 million. Additionally, our net sales orders in the June quarter were about flat with the March quarter, reflecting a traditional seasonal demand pattern." Write to Kerri Panchuk.