WCI Communities is expecting to record a loss of between $410 and $460 million for the fourth quarter of last year, the company reported in a preliminary earnings release on Tuesday March 4.
"Our earnings for the quarter and full year will reflect the very poor operating conditions that persist in our markets and will also include significant write-downs," warned Jerry Starkey, President and CEO of WCI Communities in the release.
While the company generated between $160 and $170 million in cash flow from operations and investments in the last quarter, and $220 to $230 million for the full year, that cash was offset by land impairment charges that are expected to range between $335 and $350 million for the fourth quarter, according to the release.
Because of customer walk-aways and slow sales, WCI decided that one of its Florida towers, Oceanside, no longer qualified for percent of completion accounting, leading it to completely reserve the $38 million in income generated on it since it began construction in the third quarter of 2007.
While the Bonita Springs, Fla.-based company said it hopes to file its yearly 10-K document on March 17, the same day it expects to release full earnings, the filing might be delayed because of "the unexpected length of time needed to complete a detailed impairment analysis for each community and to complete its provision for income taxes.