M/I Homes, Inc., Columbus, Ohio (NYSE:MHO) early Thursday reported a net loss of $11.1 million, or $0.60 per share, for the fourth quarter ended Dec. 31. Wall Street was expecting a loss of five cents per share.
Shares of MHO were trading down 3% at $14.67 Thursday afternoon.
The loss included a $2.4 million pre-tax loss from operations, an $8.4 million loss on the early retirement of senior notes, $1.6 million of asset impairments and a $1.3 million tax benefit. It compares with net income of $7.0 million, or $0.38 per share, primarily due to a $31.2 million tax benefit, in the 2009 fourth quarter.
Revenues fell 19.5% to $165 million as closings dropped 34% to 329 and the average closing price rose to $246,000 from $234,000 in the prior year quarter.
New orders, led by a 66% increase in the Florida region to 96 homes, were up 3% on the quarter to 460. The cancellation rate was 25%, up slightly from 23% in the 2009 quarter. Community count was up to 110 from 101.
Backlog at quarter's end fell to 532 homes from 650 at the end of the prior year quarter. Backlog value fell to $135 million from $177 million.
Gross margin improved 140 basis points to 16.7%. SG&A declined $4 million to $36 million.
The company owned or controlled 10,170 lots at the end of the quarter and the year, 7,611 owned and 2,559 under contract. That compared with 9,314 lots, 7,195 owned and 2,119 under contract, at the close of 2009.
M/I ended the quarter, and the year, with #123.1 million in cash and equivalents and $244.5 million in short and long term home building debt.The net debt-to-capital ratio increased to 34% from 23% at the close of 2009.
For the year, M/I's net loss was $26.3 million, or $1.42 per share. That broke down to a $7.7 million pre-tax loss from operations; $13.4 million of asset impairments; and an $8.4 million loss on the early retirement of debt.
Revenues rose 8.3% to $602.1 million as the average closing price rose to $247,000 from $230,000 in 2009. Closings were up 1% from 2009 to 2,434. New orders fell 7% from 2009 to 2,316 in 2010.
"During 2010 we opened 41 communities with the majority located in our Washington, D.C., Chicago, Raleigh and Charlotte markets," said Robert H.Schottenstein, president and CEO. "In 2011, we expect to open 40 additional communities, including several in our newly opened Houston, Texas market - ending 2011 with approximately 120 active communities compared to 110 at the start of the year."
He added, "As we enter 2011, we are confident that our strategy and market position will allow us to continue making progress as we strive to return to profitability."
Learn more about markets featured in this article: Columbus, OH.