Homebuilder D.R. Horton reports 4Q and annual profit
Homebuilder D.R. Horton Inc. (DHI), returned to a profit in its fiscal fourth quarter and reported its second consecutive yearly profit as housing metrics improved slightly and it kept a tight lid on overhead. Fort Worth, Texas-based D.R. Horton reported income of $35.7 million, or 11 cents a share, for the three months ended Sept. 30. The quarterly results included $12.8 million in pretax charges for inventory impairments and land option cost write-offs. First Call's earnings consensus for 4Q was 14 cents. In the year-ago period, it reported a net loss of $8.9 million, or 3 cents a share, which included $30.8 million in pre-tax charges for inventory impairments and land option cost write-offs. Homebuilding revenue for the fourth quarter was up slightly to $1.1 billion, compared to $925.7 million in the same quarter of fiscal 2010. The builder closed on 4,987 homes during the quarter, up from 4,281 a year earlier. For the full year, D.R. Horton earned $71.8 million, or 23 cents a share, missing First Call's estimate of 26 cents. Year-end results included $45.4 million in pre-tax charges for inventory impairments and land option cost write-offs and a tax benefit of $59.7 million. For full-year 2010, net income was $245.1 million, or 77 cents a share, which included $64.7 million in pre-tax charges for inventory impairments and land option cost write-offs and a tax benefit of $145.6 million. Homebuilding revenue for the year was $3.5 billion, compared to $4.3 billion for fiscal 2010. Homes closed for the year totaled 16,695 homes, compared to 20,875 homes in 2010. Sales orders were were up for the quarter. The builder had 4,241 sales orders valued at $927.6 million at the end of the fourth quarter, compared to 3,979 homes valued at $817.5 million in the same quarter of 2010. The cancellation rate was 29%. For the full year, it had sales orders of 17,421 homes ($3.7 billion), compared to 19,375 homes ($4 billion) last year. "Our strategy to open new communities for first-time and move-up buyers, improve gross margins, adjust our overhead and reduce interest expense led to our second consecutive year of profitability, despite continued challenging market conditions," said Donald Horton, chairman of the board. Positive sales comparisons in its third and fourth quarters contributed to an 18% increase the builder's sales order backlog, positioning it for a stronger start to fiscal 2012, Horton said. It had a backlog of 4,854 homes at Sept. 11 Write to Kerry Curry. Follow her on Twitter @communicatorKLC.