Hovnanian Enterprises Inc.'s (HOV) fiscal second-quarter loss
widened as revenue fell more than expected amid a drop in orders
and bigger land-related charges weighed on the bottom line.
Shares were down 3.4% at $2.26 in recent after-hours
trading.
Hovnanian's contracts have plunged in recent quarters from
year-earlier results boosted by the government's first-time
homebuyer tax credit, which ended last spring after a rush of
buyers flocked to secure it. It faces a lackluster job market and
high foreclosure activity.
For the quarter ended April 30, Hovnanian reported a loss of
$72.7 million, or 69 cents a share, compared with a year-earlier
loss of $28.6 million, or 36 cents a share. The latest and
prior-year results included $16.9 million and $1.2 million,
respectively, in pretax land-related charges.
Revenue plunged 20% to $255.1 million.
Analysts polled by Thomson Reuters most recently predicted a
51-cent loss on $263 million in revenue.
Home-building gross margin fell to 14.8% from 17.3%.
Net contracts including unconsolidated gross ventures fell 17%
to 1,166 homes. Contract backlog on the same basis ended the period
down 21% from a year earlier by number of homes.
The cancellation rate, excluding unconsolidated joint ventures,
rose to 20% from 17%.
-By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240;
matthew.jarzemsky@dowjones.com