Atlanta, GA, September 7, 2006--Beazer Homes USA Inc., cut its full-year earnings outlook Thursday, citing slumping sales and contract cancellations in the latest sign of worsening conditions in the housing market.
The homebuilder said it now expects its fiscal 2006 earnings per share to be in a range of $8 to $8.50, compared to its previous outlook of $9.25 to $9.75.
Beazer Homes said it expects to close on fewer homes in the fourth quarter than previously forecast. It said net sales through the two months ended Aug. 31 were 49 percent below prior-year levels and cancellations of existing contracts rose to 50 percent from 26 percent in the same period in the previous year.
The company blames the problems on worsening buyer sentiment and the inability of buyers to sell their existing homes.
The forecast from Beazer comes a day after Hovnanian Enterprises Inc., reported a 36 percent decline in its profit for the third quarter. The company, a New Jersey-based builder of single-family homes, struggled with higher costs, slower-paced orders and increased cancellations in a slowing real-estate market.
Los Angeles-based KB Home cut its 2006 profit forecast on Wednesday, saying it expects to earn $8 to $8.50 per share for the year versus a previous forecast of $10 per share.
Beazer Homes said it estimates that it will deliver between 12,000 and 13,500 homes in fiscal 2007, and it is reviewing its business plan for next year in light of the industry issues.
The company is scheduled to release its fourth quarter and fiscal 2006 financial results in November.
