Public builder NVR continues to escape the quarterly losses that its counterparts are experiencing. The McLean, Va.-based company today reported net income of $51.3 million, or $8.64 per diluted share, for the quarter ending June 30, on revenues of $956 million.
Compared to other public builders, those results make NVR look positively flush. Still, the company's second quarter financials are, not surprisingly, significantly below its numbers for the same period last year. Year-over-year, net income is down 43% and revenue has dropped 27%.
Closings have also slipped by 21%, to 2,750 homes with an average settlement price of $341,700. New orders have declined as well, with NVR reporting 2,670 new orders in the second quarter, a 29% year-over-year reduction. "New order units and gross profit margins continue to be negatively impacted by high levels of new and existing home inventories, affordability issues, a more restrictive mortgage lending environment, and declining home buyer confidence," the company said in a statement.
However, those new orders that happen are sticking. NVR's cancellation rate fell to 19% in the quarter, a welcome drop from earlier this year, when the company reported a first-quarter cancellation rate of 22%.
Finally, even land-light NVR posted impairments of $5.8 million for land deposits, a significant drop from 2007's second quarter, when the company wrote down $55 million worth of land.
For more information, visit www.nvrinc.com.
Alison Rice is senior editor, online, at BUILDER magazine.