Centex Corp. posted a smaller net loss for its fiscal second quarter Tuesday, but the housing slump cut the struggling home builder’s revenue by more than half.
Dallas, Texas-based Centex (NYSE: CTX) said that it lost $172 million, or $1.38 per share, for the quarter that ended Sept. 30. That compares to a loss of $644 million, or $5.26 a share, in the year-ago quarter.
Factoring out an after-tax gain of $30 million for the sale of its Westwood Insurance Agency, Centex recorded a third quarter net loss from continuing operations of $202 million, or $1.62 per diluted share – an improvement from the year-ago comparable loss of $645 million, or $5.27 per diluted share.
The narrowing of the net loss resulted from an $873 million reduction in paper losses taken for impairments on land and joint ventures.
The bottom-line improvement was not indicative of Centex’s top-line performace. The company’s revenue plummeted 54 percent, to $1.01 billion, matching the 54 percent drop in sales orders, which fell to 2,728. Factoring out results from Centex’s Financial Services business, the company posted a 55 percent drop in home-building revenue – to $953 million – as closings plunged 48 percent.
Centex has long been one of the most active home builders in the Triangle. The company ranked No. 1 on Triangle Business Journal’s list of residential homebuilders for years before falling into second place with 928 homes completed in 2007. This year has been hard on Centex’s national and local operations, as evidenced by longtime Raleigh division President Hampton Pitts resigning in July after 16 years with the company.
Showing posts with label Centex Losses. Show all posts
Showing posts with label Centex Losses. Show all posts
Wednesday, October 29, 2008
Monday, May 5, 2008
Centex Posts Huge Losses - Decline in US Home Prices to Blame
Centex saw a quarterly loss of $910.5 million, or $7.36 a share, compared to net income of $198.9 million, or $1.65 a share, a year ago. The loss from continuing operations for the fourth quarter was $7.34 a share. Revenue slid to $2.31 billion from $3.64 billion in the year-ago period.
Analysts polled by FactSet Research had expected a loss of $2.14 a share on revenue of $2.09 billion. Home closings during the period decreased 33% to 7,100 homes and average sales price slid 15% to $267,953.
Centex management is scheduled to hold a conference call Thursday morning to discuss its fiscal fourth-quarter results. Analysts will be looking for any color on how the key spring sales season is progressing.
More bad news came out of the housing market this week.
The decline in U.S. home prices quickened in February, with prices down a record 12.7% in the past year for 20 key cities, according to the Case-Shiller home price index released Tuesday by Standard & Poor's.
"We continue to believe it is too soon to say the potential for future price declines has abated," said Soleil Securities Group analysts in response to the report.
"The spring selling season is once again likely to be a bust as deteriorating economic conditions and fear of declining prices keep would-be buyers on the sidelines," wrote Morningstar Inc. analyst Eric Landry in an investor note this week.
Shares of Centex and the builder sector traded lower Wednesday after the Federal Reserve cut the key lending rate by a quarter-point. "Financial markets remain under considerable stress, and tight credit conditions and the deepening housing contraction are likely to weigh on economic growth over the next few quarters," the Federal Open Market Committee said in its statement. See The Fed.
The government continues to mull ways to help pressured homeowners and the tattered mortgage market.
Members of the House Financial Services Committee went back to work Wednesday on a multibillion-dollar housing-aid bill that is intended to help stem the foreclosure crisis. The bill would allow the Federal Housing Administration to back as much as $300 billion in refinanced loans for homeowners who are facing foreclosure. Financial Services Committee Chairman Rep. Barney Frank, D-Mass., said he expects a vote on the bill Thursday. Is now the time to buy Centex Stock?
Analysts polled by FactSet Research had expected a loss of $2.14 a share on revenue of $2.09 billion. Home closings during the period decreased 33% to 7,100 homes and average sales price slid 15% to $267,953.
Centex management is scheduled to hold a conference call Thursday morning to discuss its fiscal fourth-quarter results. Analysts will be looking for any color on how the key spring sales season is progressing.
More bad news came out of the housing market this week.
The decline in U.S. home prices quickened in February, with prices down a record 12.7% in the past year for 20 key cities, according to the Case-Shiller home price index released Tuesday by Standard & Poor's.
"We continue to believe it is too soon to say the potential for future price declines has abated," said Soleil Securities Group analysts in response to the report.
"The spring selling season is once again likely to be a bust as deteriorating economic conditions and fear of declining prices keep would-be buyers on the sidelines," wrote Morningstar Inc. analyst Eric Landry in an investor note this week.
Shares of Centex and the builder sector traded lower Wednesday after the Federal Reserve cut the key lending rate by a quarter-point. "Financial markets remain under considerable stress, and tight credit conditions and the deepening housing contraction are likely to weigh on economic growth over the next few quarters," the Federal Open Market Committee said in its statement. See The Fed.
The government continues to mull ways to help pressured homeowners and the tattered mortgage market.
Members of the House Financial Services Committee went back to work Wednesday on a multibillion-dollar housing-aid bill that is intended to help stem the foreclosure crisis. The bill would allow the Federal Housing Administration to back as much as $300 billion in refinanced loans for homeowners who are facing foreclosure. Financial Services Committee Chairman Rep. Barney Frank, D-Mass., said he expects a vote on the bill Thursday. Is now the time to buy Centex Stock?
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