Home builder Ryland swings to profit
Home builder Ryland Group Inc. posted a fourth-quarter profit Wednesday, exceeding analysts’ expectations with a boost from an income tax benefit.
The company reported earnings of $39 million, or 88 cents a share, compared with a loss of nearly $60 million, or $1.40, during the same period last year. That improvement comes on the heels of a $97.6-million tax benefit for the quarter.
Revenue declined 21% from the same period in 2008 to $418,380.
Analysts surveyed by Thomson Reuters projected an adjusted loss of 26 cents a share on revenue of $391 million.
Despite the quarterly gain, shares for the Calabasas company were down $3.74 for the year.
Wednesday’s results mark the first quarterly profit the housing giant has shown in three years. Drew Mackintosh, vice president of investor relations at Ryland, attributed the strong showing to more than just the tax benefit.
“It’s our home-building operations too,” he said. “Our sales pace has improved, our margins have improved.”
New orders in the fourth quarter came out to 969 units compared with 554 a year earlier.
The company’s huge tax benefit was mostly the result of recently enacted legislation extending the carry-back period for operating losses to five years from two.
For Ryland, inventory of unsold homes under construction decreased by almost a third to 429 units at year’s end compared with a year earlier.
Separately, sales of all new U.S. homes declined 7.6% in December, the government said Wednesday, stirring concern that the nation’s housing market would suffer after a series of government policies, including tax incentives for buyers and low interest rates, expire later this year.
The seasonally adjusted annual sales rate for single-family homes in the U.S. in December was 342,000, according to the figures, down from a revised November rate of 370,000 and 8.6% below the December 2008 figure of 374,000. The median sales price -- the point at which half the homes sold for more and half for less -- of new houses sold in December 2009 was $221,300.
The total number of new homes for sale at the end of December stood at 231,000, a supply of 8.1 months at the current sales clip.
For the year, the number of homes sold declined 22.9% in 2009 from the prior year to an estimated 374,000.
