By Anastasia Tomazhenkova: The largest U.S. homebuilder DR Horton Inc. announced its third consecutive quarterly loss as demand for new homes deteriorated.
Losses for the quarter ended December 31 totaled 128.8 million dollars, or 41 cents a share, compared with profit of 109.7 million dollars, or 35 cents a share, a year ago. The 2008 quarter includes 245.5 million dollars in pretax charges to write down inventory and the value of land deposits.
Revenue plunged to 1.71 billion dollars from 2.8 billionb dollars a year ago. The builder closed on 6,549 homes, down sharply from 10,202 in the 2007 period.
Analysts surveyed by Thomson Financial expected a loss of 25 cents a share on revenue of 1.62 billion dollars.
D.R. Horton said its sales order backlog of homes under contract at December 31 was 8,138 homes (2.0 billion dollars), compared to 16,694 homes (4.7 billion dollars), at December 31, 2006. The cancellation rate for the first quarter was 44%.
"Market conditions remained challenging in our December quarter as inventory levels of both new and existing homes remained high while pricing remained very competitive," said chairman Donald R. Horton. "Lending standards continue to be more restrictive than during the previous year, and buyers continued to approach the home buying decision cautiously."
Horton said he expects the housing environment to remain challenging. The company's 2008 goal is to generate at least 1 billion dollars in cash flow from operations. In the first quarter it generated more than 550 million dollars in cash flow from operations, mainly driven by 476 million dollars in cash generated by reducing our inventories.
Shares rose 37 cents to 15.18 dollars at the open of trading.