NVR Inc., based in Reston Va. (NYSE:NVR), reported net income of $43.4 million ($7.42 per diluted share) for the first quarter of 2008, a drop of 49% from the 2007 first quarter. Still, NVR's balance sheet remains the best in the home building business, with $767 million in cash on the books, $6.6 million in land deposit impairments and a debt-to-capital ratio of 14%.
The results were due to a 19% decline in revenues, to $887.9 million. Home building revenues were down 52% to $61,932,000 as new orders fell 30% to2,731 units and settlements decreased 9% to 2,465 units, both compared to the same period of 2007.
The cancellation rate in the first quarter of 2008 was 22% compared to 16% in the first quarter of 2007 and 32% in the fourth quarter of 2007. The cancellation rate in the Washington, D.C. market was 30% in the quarter compared to 22% in the first quarter of 2007 and 46% in the fourth quarter of 2007. The average sales price of new orders in the first quarter of 2008 declined by 14% to $320,000, led by an 18% decline in the Mid-Atlantic region.
The Company's backlog of homes sold but not settled at the end of the quarter was down 29% to 5,411 units with a value of $1,915,519,000, a decline of 37% from last year's first quarter. NVR cut its average community count to 442 from 527 at this time last year.
NVR's mortgage operations closed loan production of $523,5 million for the quarter, 27% lower than the same period last year. Operating income for the mortgage banking operations during the first quarter of 2008 increased 11% to $11,243,000.