Beazer Homes USA, Atlanta (NYSE:BZH) on Friday morning reported a net loss of $59.5 million, including a net loss from discontinued operations of $2.1 million and $26.5 million in inventory impairments, for its fiscal 2010 fourth quarter ended Sept. 30. The loss compared with a $33.5 million profit in the comparable quarter of 2009. Comparison of profit-and-loss-per-share data was not meaningful due to stock dilution resulting from the issuance of 34.9 million new shares of common stock during the fiscal year.
Beazer said its loss from continuing operations was $57.4 million (- $0.78 per share). Analysts were expecting a loss of 46 cents per share. Beazer shares were trading up 3.9% at $4.50 in mid-morning trading Friday.
Revenue fell 24.8% to $274.8 million, as home closings fell 29.5% to 1,189 (-30% to 1,149 including discontinued operations in Jacksonville and Albuquerque. The company also shuttered its title services operations.)
New orders fell 20% to 810 homes of which 778 new orders were from continuing operations, representing a 20.6% decrease year-over-year. The cancellation rate fell to 33% from 35.2% in last year's quarter.
Backlog at quarter's end and the end of the fiscal year was 796 homes with a sales value of $189.1 million compared to 1,193 homes with a sales value of $280.8 million as of September 30, 2009.
The gross profit margin from continuing operations was 1.7% (11.3% without impairments and abandonments), compared to 6.1% (14.3% without impairments and abandonments) in the fourth quarter of the prior year. SG&A was down to $44.3 million from $57 million in last year's quarter. The company said the drop in margin was primarily attributable to non-recurring changes in warranty expense, greater concessions made to homebuyers during the quarter and higher indirect construction costs associated with newly acquired communities.
The Company controlled 28,996 lots at September 30, 2010 (80% owned and 20% controlled under options) a reduction of 5.4% from September 30, 2009. At quarter's end, unsold homes consisted of 423 finished homes and 382 homes under construction, a 28% reduction (311 homes) compared to June 30, 2010.
The company ended the quarter and the fiscal year with $537.1 million in cash and $39 million in restricted cash, compared to $507.3 million and $49.5 million, respectively, in the 2009 quarter. It was carrying $1.21 billion in debt on its balance sheet, down from $1.5 billion at the same time last year.
For the fiscal year, Beazer posted a net loss of $34.05 million, including a loss from discontinued operations of $4.13 million, net of a $14.8 million benefit from income taxes. The prior-year loss was $189.4 million, including a loss from discontinued operations of $13.9 million, net of a $0.7 million benefit from income taxes. Total home closings were 4,645 homes, a 5.9% increase from fiscal 2009, and new orders were 4,248 homes, a 0.6% increase from fiscal 2009. Revenue from continuing operations was $1.01 billion, compared to $971.7 million in the prior year.
"We are pleased with the overall operational and financial progress we made during fiscal 2010, in spite of the continuing difficult conditions in the economy and the homebuilding industry," said Ian J. McCarthy, president and CEO. "We recognize that consumers remain hesitant to commit to new home purchases because of concerns about employment and prospective foreclosures, among other issues. But, with a substantially improved balance sheet and gradually improving operational performance, we believe we are well positioned to participate in the eventual housing recovery."