Builder Hovnanian Sees Smaller Quarterly Loss

Red Bank, NJ, June 3, 2010--Homebuilder Hovnanian said it lost $28.6 million, or $0.36 a share, in the three months ended in April, compared to a loss of $118.6 million, or $1.50 a share, in the prior-year period.

Revenue dropped to $318.6 million from $398 million the year before.

Completed sales totaled 1,118 homes, down 19% from the same period last year.

The rate at which buyers canceled contracts fell to 17% from 24% in the prior-year period.

The recent stability in home prices, "gives us reason to believe that we are at or near the bottom of this cyclical housing downturn," said Ara Hovnanian, the builder's chairman and chief executive.

In addition, Hovnanian noted May contracts were coming in slower than a year ago, citing the loss of a homebuyer tax credit that helped stoke sales this spring, but expired April 30. The company has previously estimated that the tax credit boosted its sales by about 10%.

"Our slower pace of May net contracts seems to confirm that the tax credit helped pull some sales forward into earlier months this year," Hovnanian said.