Pulte Homes, ranked No. 3 in the 2006 BUILDER 100, is reporting a third quarter (ending Sept. 30) net loss of $787.87 million compared to a net profit of $190.22 million in the same quarter last year. The builder's third quarter results were made public after the stock market closed Wednesday.
The third-quarter loss for the Bloomfield Hills, Mich., company includes more than $1 billion in impairments and charges tied to the housing slump and a $4.1 billion dollar backlog of more than 12,000 homes.
"The operating environment continues to be challenged with elevated levels of new and resale home inventory, tightening of mortgage liquidity, and weak consumer sentiment for housing," said Richard J. Dugas, Jr., CEO of Pulte Homes. "In the midst of these conditions, in the third quarter we were profitable on a pre-impairment basis, which exceeded the higher end of the guidance we previously provided of $0.10 to $0.20 per diluted share, exclusive of impairments or land-related charges. We also modestly improved our cash position, while reducing outstanding debt under the revolving credit facility."
Revenue for the big builder slipped 31 percent to $2.47 billion from $3.56 billion a year earlier, while closings sank 28 percent to 7,468 homes. Adding to the builder's woes was a 37 percent drop in new orders to 4,572 units. The average price per home decreased 4 percent from the previous year's third quarter to $322,000.
Looking forward, Dugas says the company's fourth quarter expectations include "projecting income from continuing operations in the range from break-even to $0.10 per diluted share, exclusive of any additional impairments, land-related charges or goodwill impairment."
"Due to the lack of longer-term earnings visibility and the difficult market conditions that persist, we are not at this time providing guidance for any period beyond the fourth quarter of this year," Dugas added.
Further statements about the company's third quarter will be made during a Thursday morning conference call.