D. R. Horton Inc. Earnings Cheat Sheet: Revenues Fall, Bringing Down Profit

S&P 500 (NYSE:SPY) component D. R. Horton Inc. (NYSE:DHI) saw profit fall amid falling revenue. D.R. Horton Incorporated is a homebuilding company which constructs and sells homes in the United States and provides mortgage financing and title agency services to homebuyers.

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D. R. Horton Earnings Cheat Sheet for the Third Quarter

Results: Net income for D. R. Horton Inc. fell to $28.7 million (9 cents per share) vs. $50.5 million (16 cents per share) a year earlier. This is a decline of 43.2% from the year earlier quarter.

Revenue: Fell 29% to $975.4 million from the year earlier quarter.

Actual vs. Wall St. Expectations: DHI beat the mean analyst estimate of 6 cents per share. Analysts were expecting revenue of $987.3 million.

Quoting Management: Donald R. Horton, Chairman of the Board, said, “We are proud of the results our team achieved this quarter. Sequentially, our homebuilding revenues grew $242 million, home sales gross margins improved by 30 basis points and homebuilding 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. Our results for the first nine months of the fiscal year, combined with our backlog of 5,600 homes and our inventory of homes available for sale, have positioned us to be profitable for the full fiscal year. “Market conditions in the homebuilding 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. However, housing affordability remains near record highs, interest rates are favorable and new home inventory is still very low. We continue to focus on providing new homes and communities for both first-time and move-up buyers, controlling our construction costs, SG&A and inventory levels and maintaining our strong balance sheet and liquidity.”

Key Stats:

Revenue has fallen in the past four quarters. Revenue declined 17.8% to $751.1 million in the second quarter. The figure fell 30.4% in the first quarter from the year earlier and dropped 7.8% in the fourth quarter of the last fiscal year from the year-ago quarter.

The company topped expectations last quarter after falling short of forecasts in the second quarter with a loss of 6 cents versus a mean estimate of a loss of 5 cents per share.

Competitors to Watch: PulteGroup, Inc. (NYSE:PHM), KB Home (NYSE:KBH), Lennar Corporation (NYSE:LEN), Toll Brothers, Inc. (NYSE:TOL), The Ryland Group, Inc. (NYSE:RYL), NVR, Inc. (NYSE:NVR), M.D.C. Holdings, Inc. (NYSE:MDC), Standard Pacific Corp. (NYSE:SPF) and Meritage Homes Corporation (NYSE:MTH).

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(Source: Xignite Financials)