D.R. Horton posts biggest profit since 2006

Posted Monday, Nov. 12, 2012  comments  Print Reprints
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FORT WORTH -- Fort Worth-based homebuilder D.R. Horton said Monday that it had its best quarter since the housing market collapsed in the three months ended Sept. 30, helping the company to its most profitable year in six years.

Horton reported a fiscal fourth quarter profit of $100.1 million, or 30 cents a share. That's nearly triple the profit of $35.7 million, or 11 cents a share, for the same quarter in fiscal 2011.

Horton ended the year with net income of $956.3 million, or $2.77 a share, largely as a result of a $713.4 million tax benefit, due to a reduction of the company's valuation allowance for its deferred tax asset. In fiscal 2011, net income was $71.8 million, or 23 cents a share, which included a tax benefit of $59.7 million.

"Our fiscal 2012 financial results reflect continued improvement in the housing market and in our company's performance," said Chairman Donald Horton in a statement. "Our fourth-quarter pre-tax income of $99.2 million was our highest in 22 quarters and contributed to our fiscal 2012 pre-tax income of $242.9 million, the highest since fiscal 2006."

Despite the positive report, shares of Horton stock (ticker: DHI) were down 67 cents, at $19.93 a share, in afternoon trading on the New York Stock Exchange. According to Bloomberg News, shares fell after Horton's chief executive cautioned that employment growth will remain weak next year, potentially hurting sales of new houses.

“I still don’t see a lot of jobs being created,” CEO Donald Tomnitz said during a conference call. “And I also see the fact that there are potential layoffs in a number of industries, especially the defense industry.”

The company said sales orders increased 24 percent in the fiscal fourth quarter and homebuilding revenues increased 21 percent, to $1.3 billion from $1.1 billion in the same quarter of 2011.

"We are well-positioned with our brand's national footprint," Tomnitz said. "We feel confident we will have a much better 2013 than 2012. We're going in with eyes open wide and great expectations."

Horton said it sold 5,575 homes in the quarter, an increase of 12 percent from a year ago. Homes closed in fiscal 2012 increased 13 percent, to 18,890 homes from 16,695 in fiscal 2011, the company said.

In another key number, the company said its sales order backlog of homes under contract at Sept. 30 increased 49 percent to 7,240 from 4,854 homes at the same time last year. That's the highest backlog since 2007. The value of the backlog increased 61 percent, to $1.7 billion from $1.0 billion a year ago.

Sandra Baker, (817) 390-7727

Twitter: @SandraBakerFWST

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