NVR Inc., Reston Va. (NYSE:NVR) before market open Thursday reported a profit of $38.4 million, or $6.48 per diluted share, for the second quarter ended June 30, 46% below a profit of $71.3 million recorded for comparable quarter last year. Analysts were expecting a gain of $6.28 per share.

Revenues for the quarter were down 28% to $695.9 million. Home building revenues were down 27.9% to $682.7 million as closings dropped 34% from last year's tax-credit-fueled quarter to 2,207 units in this year's quarter and the average settlement price rose 9.1% to $309,200.

New orders dropped 4% to 2,468 units; the average new-order price slipped 1.9% to $303,500. The cancellation rate in quarter crept up to 12.5% from 12.0% in last year's second quarter and 12.3% in this year's first quarter.

Backlog at quarter's end was up 5% from last year's quarter to 3,946 units with backlog value up 4% to $1.23 billion. The average backlog price fell 0.8% to $312,500.

Gross profit margins decreased to 18.2% from 18.5% for the same period in 2010. SG&A was down modestly to $68 million from $69.1 million in last year's quarter.

The company's mortgage banking segment reported closed loan production of$504.1 million for the quarter, was 29% lower than the same period last year. Operating income for the segment decreased 46% to $6.3 million.

NVR ended the quarter with $927.4 million in cash, down from $1.19 billion at yearend 2010.

As is customary for NVR, the company provided no commentary on the results.

Adam Rudiger at Wells Fargo saw positives in the earnings report, particularly for the future. In the "Takeaways" section of his reserach alert, he wrote, "1) NVR continues to buy back its shares -- a strategy that has historically been a significant driver of price appreciation, in our view, one which we view as a significant differentiator vs. peers. During Q2, the co. repurchased 326K shares for $238MM -- a significant increase from the prior quarter's 85.5K buyback. 2) Although continually volatile on an intraquarter basis, the demand environment was relatively stable sequentially, with orders up 2.7% sequentially despite no material change in incentives. 3) Gross margins rose 110 bps sequentially to 18.2%, which we believe was largely a volume-related benefit. 4) NVR was relatively inactive in deploying its capital in 2008 and 2009 but has since been taking advantage of its best-in-peer-group liquidity and capital position as evidenced by the share repurchase this quarter, the 81% yr/yr dollar increase in land deposits and the Morgan Stanley joint venture announced subsequent to quarter-end. We view these land and option investments coupled with the new plant in Dayton, OH as near market-bottom growth investments that should allow the company to emerge from this downturn better positioned relative to peers than when the downturn began."