Atlanta, GA, April 27, 2006--Beazer Homes USA Inc., on Thursday posted better-than-expected earnings for the second quarter, but said orders for new homes fell and the homebuilder revised its outlook for the full-year lower.
Net income for the quarter ended March 31 was $104.4 million, or $2.35 per share, compared with a loss of $84.3 million, or $2.09 per share, a year ago. Excluding a charge for writing down the value of goodwill, earnings a year ago were $1.04 per share.
Revenue rose 30 percent to $1.27 billion from $976.2 million as the company closed on 4,273 homes in the quarter, up 19 percent from a year ago.
Analysts surveyed by Thomson Financial were expecting Beazer to post a profit of $2.27 per share on $1.17 billion in revenue.
Similar to what investors have heard from other homebuilders in a climate of rising interest rates, Beazer said orders for new homes fell 19 percent to 4,224 homes in the quarter. Orders were significantly lower in Western states such as Arizona, California and Nevada, Beazer said.
"In a number of markets across the country, we have seen the pace of sales decline and price appreciation moderate relative to that experienced over the past several years, as evidenced by the lower net orders this quarter," president and chief executive officer Ian J. McCarthy said in a statement. Nonetheless, he said long-term fundamentals remain strong for both the company and the housing industry.
Beazer's backlog stood at 9,227 homes with a value of $2.79 billion at March 31, compared with 10,064 homes with a sales value of $2.9 billion a year earlier.
McCarthy said the difficult current sales conditions, combined with expected costs from exiting underperforming markets, have led the company to revise its full-year forecast to a profit between $10 and $10.50 per share. The company previously said it expected profit to meet or exceed $10.50 per share.
