Homebuilder Beazer Homes USA, Inc. (BZH) on Thursday reported a loss for the third quarter that narrowed from last year on strong revenue growth that reflects higher home closings and improved sales prices. However, revenues missed analysts' expectations.
Looking ahead, the company said it expects to report positive net income in the fourth quarter and also report its first full year of profitability in nearly a decade for fiscal 2014.
Atlanta, Georgia-based Beazer Homes noted that its third-quarter results included notable progress on its Path-to-Profitability strategies, including increased margins and higher sales per active community.
In the third quarter, homebuilding revenue rose 24 percent from the year-ago period to $313.13 million. Average sales price from closings increased 11.7 percent to $253.8 thousand. Total home closings grew 11.3 percent to 1,234 homes.
Homebuilding gross profit margin, excluding impairments and abandonments, increased 660 basis points to 17.1 percent.
The company said its new home orders declined 11.2 percent from last year to 1,381, due to an expected decline in community count. Cancellation rates were 20.0 percent, lower than 24.5 percent a year earlier.
Total backlog from continuing operations at the end of the quarter was 2,358 homes with a sales value of $646.1 million. This compared to 2,421 homes with a sales value of $572.8 million as of June 30, 2012.
The company's net loss for the third quarter narrowed to $5.79 million or $0.23 per share from $39.88 million or $2.01 per share in the previous-year quarter. On average, nine analysts polled by Thomson Reuters expected the company to report loss per share of $0.37 for the quarter. Analysts' estimates typically exclude one-time items.
Total revenues for the quarter grew 24 percent to $314.44 million from $254.56 million in the prior-year period, but missed analysts' consensus estimates of $332.21 million.
The prior-year quarter's results include inventory impairments and option contract abandonments of $5.82 million.
Looking ahead, Allan Merrill, CEO of Beazer Homes said, "With improved homebuilding gross margins, higher average sales prices and strict control over operating expenses, we are poised to report positive net income in our fiscal fourth quarter and expect to report our first full year of profitability in nearly a decade for fiscal 2014."
In Thursday's regular trading session, BZH is trading at $17.56, up $0.37 or 2.15 percent on a volume of 698,570 shares.
by RTT Staff Writer
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