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D.R. Horton loss narrows in fiscal Q4

Homebuilder D.R. Horton posts narrower loss in 4th-qtr, but revenue and orders slide
D.R. Horton Inc. said Friday its loss narrowed in its fiscal fourth quarter as the homebuilder took fewer writedowns on the value of its properties.

But revenue slid 9 percent as the company sold fewer homes in the quarter, and new orders dropped 21 percent.

Horton said the housing market became even more challenging after a tax credit expired in April. Absent the government incentives -- and despite mortgage rates remaining at near-historic lows -- many homebuyers are opting to stay on the sidelines, put off by high unemployment, tight credit and uncertainty about home prices.

The expiration of the tax credit has weighed heavily on Horton, as first-time homebuyers account for more than half of its business.

Home sales were the worst in decades this summer. In the midst of that decline in demand, large homebuilders have reported sharp annual declines in new home orders for the July-September quarter.

Horton's new orders in the fourth quarter totaled 3,979 homes, for a total value of $817.5 million, down from 5,008 homes, valued at $1.0 billion, a year earlier.

Among other homebuilders, PulteGroup Inc. recently reported its new home orders slid 12 percent from a year ago and roughly 15 percent since the second quarter. Builder Meritage Homes Corp. said orders were down 36 percent from a year ago, while Ryland Group Inc. reported orders were down 37 percent.

D.R. Horton said it lost $8.9 million, or 3 cents per share, in the three months ended Sept. 30. That compares with a loss of $234.9 million, or 74 cents a share, in the prior-year period.

The results included $30.8 million in charges for inventory impairments and land option cost write-offs. The year-earlier results included $192.6 million in similar charges.

Revenue dropped to $925.7 million from $1.01 billion.

Thomson Reuters says analysts were expecting a loss of 4 cents a share on revenue of $854 million.

The Fort Worth, Texas, company's summer cancellation rate was 31 percent.

For the full fiscal year, the company's results were boosted by the first-time homebuyer credit. It earned $245.1 million, or 77 cents per share, compared with a loss of $549.8 million, or $1.73 per share, in fiscal 2009.

Revenue jumped 20 percent to $4.31 billion.

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