NVR Inc. (NYSE:NVR) on Tuesday morning reported it had returned to profitability in the first quarter of 2009 after posting a rare loss in the fourth quarter of 2008. There were no impairments or land-related charges to earnings reported.
NVR said net income for the first quarter ended March 31, 2009 was $17.98 million ($3.02 per diluted share), a 59% decline compared to the 2008 first quarter, but profit nonetheless. The company previously reported a loss of$30.5 million (-$5.54 per diluted share) for the fourth quarter of 2008.
Consolidated revenues were down 37% from the year-earlier quarter to $558.6 million. for the first three months of 2009 totaled $558,599,000, a 37% decline from $887,931,000 for the comparable 2008 quarter. Home building revenues for the quarter totaled $548,329,000, also 37% lower than the year earlier period as settlements declined 28% to 1,773 units. The average settlement price dropped 12.4% to $308,800 from $352,600 in the year-earlier quarter.
New orders in the quarter fell 11% to 2,426 units compared to a year earlier. The cancellation rate fell to 15% compared from 22% in the first quarter of 2008 and 30% in the fourth quarter of 2008. The average sales price of new orders declined 12% from the first quarter of 2008 to $281,900.
Backlog of homes sold but not settled at the end of the 2009 quarter decreased on a unit basis by 29% to 3,817 units from the same period last year. On a dollar basis, backlog dropped to $1,139,210,000, a decline of 41% when compared to the same period last year as the average backlog price declined to $298,500 from $354,000.
The company cut its community count to 357 from 442 and its controlled lot position to 44,000 from 64,000 at the same time last year.
Gross profit margins were 15.6% in the 2009 first quarter compared to 16.4% for the same period in 2008. Land deposit impairments in the 2009 quarter were $0 compared to approximately $6,600,000 in the first quarter of 2008.
Mortgage closed loan production of $427.3 million for quarter was a decline of 18% than the same period last year. Operating income for the mortgage banking operations during the first quarter of 2009 decreased 57% to $4.8 million.
NVR said it closed the quarter with a cash and cash equivalents and marketable security position of $1,251,131,000. The marketable securities included $309,018,000 of debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies, and $349,344,000 of corporate debt securities issued under the FDIC Temporary Liquidity Guarantee Program.
NVR also reported that on April 3, 2009 it repurchased $2.9 million of the Company's 5% Senior Notes due 2010 on the open market at par. The remaining outstanding balance of the Senior Notes is $135,370,000.
Shares of NVR opened up and had gained 10.6% to $504.93 in mid-afternoon trading before closing up 8.6% at $495.59 on nearly triple its prior-day volume.