Red Bank, NJ, March 2, 2006-- Luxury home builder Hovnanian Enterprises Inc., reported first quarter earnings that were virtually unchanged as permit delays and shortages of material and labor cut into output in several markets.
For the quarter ended Jan. 31, Hovnanian said it earned $81.4 million, or $1.25 a share, compared with $81.5 million or $1.25 a share in the year-earlier quarter.
Sales rose 18 percent to $1.28 billion, the company said.
Analysts, on average, expected the company to report profit of $1.24 a share on sales of $1.27 billion.
Hovnanian said it delivered 3,845 homes worth $1.2 billion during the quarter, up from 3,266 homes worth $1.0 billion, during the comparable quarter last year.
Ara Hovnanian, the company's president and chief executive, said the results might have been better but for hurricane-caused permitting delays in Florida and a shortfall in materials and labor in several markets.
The home builder noted that market conditions in many regions had "cooled from their previous white hot levels, with respect to both sales pace and price increases."
Even so, it reiterated its forecast for fiscal 2006 earnings, saying it expected to make between $8.05 and $8.40 a share, a 12 to 17 percent increase over fiscal 2005.
"While our contract backlog is very strong," Larry Sorsby, the company's chief finance officer said, "regulatory and production delays are contributing to a significant weighting of our fiscal 2006 deliveries toward the second half of the year, with an especially large number of deliveries projected for our fourth quarter."
