William Lyon Homes, Newport Beach, Calif., on Thursday reported a net loss of $11.6 million for the third quarter ended Sept. 30, compared to net loss of $41,096,000 for the comparable period a year ago. The loss in the 2008 quarter included $21.9 million in impairment charges, with no comparable charge in this year's quarter.
Lyon is not publicly traded but reports results for the benefit of bondholders.
Consolidated operating revenue decreased 34% to $67.2 million in the quarter. Home closings, including joint ventures, fell 1% to 227 as the average sales price dropped 33% to $245,700. The company attributed the price drop to "price depreciation in certain markets resulting from competitive pressures and a change in product mix."
New orders decreased 7% to 246 homes; new home orders per average sales location increased to 10.3 from 6.8 for the comparable quarter last year.The cancellation rate fell to 19% compared to 33% during the 2008 quarter.
Backlog was down 33% to 320 homes with an aggregate values of $81.2 million, down 51% from Sept. 30, 2008 but up 9% from June 30, 2009.
Community count fell to 24 from 39 at the same time last year. Lots controlled was down to 9,996 from 12.030 last Sept. 30, with 1,221 owned.
Gross margin, including joint ventures, rose to 12% from 4.7% for the nine months ended Sept. 30 versus the same period last year. For the quarter, SG&A fell to $7.3 million from $15.1 million in the prior-year quarter.
The company ended the quarter with $32.2 million in cash and cash equivalents, down from $67 million at yearend 2008. The debt-to-capital ratio increased to 77.3% from 76.6% on Sept. 30, 2008.
On Oct. 20, 2009, the company received a first-lien secured loan of up to$206 million, secured by its assets. The net proceeds of the $131 million first installment of the loan were used to repay the company¹s revolver and to repurchase $72.5 principal amount of its outstanding senior notes for $50.8 million plus accrued interest. Lyon said it expects to use the remaining proceeds from the first and second installments for general corporate purposes and "opportunistic land acquisition."