Bloomfield, MI, February 1, 2007--Pulte Homes reported a loss in the fourth quarter, the result of slumping home closings and a large inventory charge.
The company reported a quarterly loss of $8.4 million, or 3 cents per share, compared with a profit of $574.5 million, or $2.19 per share, in the same period a year ago. Total revenue declined to $4.39 billion from $5.13 billion.
Wall Street, on average, expected a loss of a penny per share on revenue of $4.14 billion, according to an analyst poll by Thomson Financial.
During the quarter, Pulte said closings fell 20 percent to 12,566 homes, offsetting a rise in average sales price per home of 6 percent to $341,000, primarily due to geographic changes in where homes were sold. The company's backlog value, as of December 31, was $3.6 billion or 10,255 homes, down from $6.3 billion or 17,817 homes in the prior year.
Also hurting the quarter was about $350 million, 88 cents per share, in charges related to adjustments to land inventory and land held for sale.
"We witnessed some promising signs of stabilization at the conclusion of the quarter, and into the first month of 2007, although it's too early to tell how strong and sustainable this may prove to be in the months ahead," president and chief executive Richard J. Dugas Jr. said in a statement.
For the full year, earnings slumped to $687.5 million, or $2.66 per share, from $1.49 billion, or $5.68 per share, in 2005. Total revenue dropped to $14.27 billion from $14.69 billion.
Pulte's struggles echo those of other homebuilders stung by high cancellation rates and a glut of unsold homes driving prices down.
Pulte recorded net orders in the October-December quarter for 6,446 new homes valued at $2.1 billion, which represented declines of 34 percent and 38 percent from the prior year period.
The home builder said its financial services wing reported a 14 percent increase in quarterly pretax income to $29.7 million as it capitalized on demand for mortgage options and favorable interest rates.
