Luxury homebuilder Toll Brothers (TOL) posted a $40.8m, or $0.25 per share, loss for its fiscal year first quarter that ended January 31, 2010. The results reflect narrowed loss for the builder, in a quarter marked by a 129% increased in the value of its net contracts signed and a more than 30% drop in cancellation rate, compared to the year-ago quarter. The FY Q110 results include $33.4m in pre-tax write-downs. Toll Brothers said $22.8m of the write-downs was attributable to operating communities, $9m to owned land and $1.6m to land controlled for future communities. That compares to an $88.9m, or $0.55 per share, loss in FY Q109, when the Pennsylvania-based builder had $156.6m in pre-tax write-downs. Without the write-downs, Toll Brothers said its quarterly loss would have been $23.4m, compared to pre-tax earnings of $100,000 last year. “A year ago at this time we feared for the stability of the nation’s economic system. That worry seems to be behind us,” said chairman and CEO Robert Toll. “The housing market took several years to recover following the downturn of the late 1980’s and early 1990’s. We expect this recovery to follow a similar pattern.” Like many other public builders, Toll Brothers benefited from a temporary change in tax law that allowed the company additional time to collect a tax refund from profitable years due to its current losses. The so-called net operating loss (NOL) carryback provision netted Toll Brothers a $16m tax refund attributable to the quarter. Q110 revenue was $326.7m, down 20% from Q109’s revenue of $409m. Toll Brothers delivered 596 units in the quarter, down 10% from 665 units in the year-ago quarter. But despite having 26% fewer communities than a year ago, net signed contracts in the quarter totaled 526 units valued at $292.1m, a 98% increase from 266 units and a 129% increase from $127.8m in dollar value, both compared to Q109. The average price per unit of gross contracts signed in Q110 was $555,000, compared to $562,000 in Q409 and $574,000 in Q109. The cancellation rate also dropped from the year-ago quarter to 6.7%, compared to 37.1%. “This quarter’s total net signed contracts were up significantly compared to 2009’s first quarter, but last year’s results were posted in the midst of the financial crisis,” Toll said. “Our per-community net signed contracts exceeded both 2009’s and 2008’s first-quarter per-community average; however, our results were approximately half the average of all previous first quarters dating back to 1990.” Write to Austin Kilgore. The author held no relevant investments.