M/I, based in Columbus, Ohio, said it lost $58.7 million (-$4.18 per share) in the quarter, owing to a 31.1% drop in revenues to $160.3 million, $43.5 million for asset impairments and a loss from operations of $14.9 million. The company also took a $21.6 million FAS 109 charge against deferred tax assets
Homes delivered fell 29% to 555, and new orders fell 19% to 456. The company did not report the average sales price of delivered homes. The cancellation rate, which was reported earlier, was 32%, down from 38% in last year's third quarter.
Homes in backlog at quarter's end totaled 781 with a sales value of $212, down by nearly half from 1,468 at the same time last year and down more than half in sales value from $481 million. The average sales price of homes in backlog fell 16.8% to $272,000.
"Market conditions in the homebuilding industry continue to be very challenging," said Robert H. Schottenstein, M/I's president and CEO. "Demand is weak, consumer confidence is at or near an historical low, unemployment is rising and tightened mortgage lending standards, combined with the unprecedented turmoil in the financial markets, have further contributed to very difficult conditions for homebuilders. We remain in a primarily defensive operating mode."
To that end, Shottenstein said, the company has taken the balance on its home building credit facility to zero, reduced its net debt-to-capital ratio to 32%, and had $14 million in home building cash at the end of the quarter.M/I has cut its lot owned lot count by 31% to 9,530 lots since the beginning of 2008. Its community count is 138, down from 159 at the end of September, 2007.
So far in 2008, the company has reported a net loss of $175.0 million(-$12.48) per share and has recorded $105.7 million of pre-tax charges for asset impairments. It also has taken a total of $79.6 million in after-tax non-cash valuation allowances against deferred tax assets.
For the nine months, homes delivered decreased 33% to 1,507 and new contracts fell 19% to 456, both compared to the same period last year.
M/I shares were trading up 13.7% at $11.94 at 3:40 p.m. Thursday.