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PulteGroup, Inc. Message Board

  • bluecheese4u bluecheese4u Jan 30, 2008 6:03 PM Flag

    Pulte Homes Reports Fourth Quarter and Full Year 2007 Financial Results

     

    Pulte Homes Reports Fourth Quarter and Full Year 2007 Financial Results
    BLOOMFIELD HILLS, Mich., Jan. 30 /PRNewswire-FirstCall/ --

    -- Company Ended 2007 With $1.1 Billion of Cash
    -- Company Targets Year-End 2008 Cash Position of $2 Billion to $2.2
    Billion
    -- Pre-Impairment, Pre-tax Income Exceeded the High End of Previous
    Guidance Range
    -- Net New Orders Were 4,562 for the Quarter, Down 29% from the Prior
    Year Fourth Quarter
    -- Closed 8,714 Homes in Fourth Quarter 2007, a Decrease of 31% From Last
    Year; Average Sales Price Per Home Decreased 6% from the Prior Year
    Fourth Quarter to Approximately $319,000
    -- Backlog at December 31, 2007 of 7,890 Homes, Valued at $2.5 Billion
    -- Impairments and Land-Related Charges of $509 Million, and $34 Million
    in Goodwill Impairment for the Fourth Quarter 2007
    -- After-Tax, Non-Cash Deferred Tax Valuation Allowance of $622 Million
    Recorded During the Fourth Quarter 2007
    -- Q4 2007 Loss From Continuing Operations of $3.54 Per Share, Inclusive
    of Impairments, Land-Related Charges, Impairment of Goodwill and
    Deferred Tax Valuation Allowance
    -- Company Provides First Quarter 2008 Guidance


    Pulte Homes (NYSE: PHM) announced today financial results for its fourth quarter and year ended December 31, 2007. For the quarter, the Company reported a pre-tax loss from continuing operations of $453.8 million, compared with an $18.1 million pre-tax loss for the prior year fourth quarter. The fourth quarter 2007 pre-tax loss included $543.3 million of charges related to inventory impairments, other land-related charges and impairment of goodwill. These charges were equal to $1.28 per share on an after-tax basis, before consideration of the valuation allowance related to the deferred tax assets discussed below. In the fourth quarter of 2006, these charges totaled $349.9 million, or $0.64 per share on an after-tax basis.

    An after-tax, non-cash valuation allowance of $622 million, or $2.46 per share, was recorded during the fourth quarter of 2007 by the Company related to its deferred tax assets in accordance with Statement of Financial Accounting Standards No. 109 "Accounting for Income Taxes." This allowance is reflected as a charge to fourth quarter income tax expense and a reduction of the Company's deferred tax assets as of December 31, 2007. Including this valuation allowance, the Company recorded a loss from continuing operations of $893.3 million, or $3.54 per share, for the fourth quarter 2007, compared with a loss of $8.3 million, or $0.03 per share, for the prior year fourth quarter.

    Consolidated revenues for the quarter were $2.9 billion, a decline of 34% from prior year revenues of $4.4 billion.

    For the full year 2007, Pulte Homes reported consolidated revenues of $9.3 billion, a decrease of 35% from the prior year. The Company had a loss from continuing operations of $9.02 per share, compared with earnings of $2.67 per diluted share in the prior year.

    "The challenging market conditions that plagued the homebuilding industry for the first nine months of 2007 worsened in the fourth quarter," said Richard J. Dugas, Jr., President and CEO of Pulte Homes. "Levels of new and existing home inventory remain elevated, buyer demand for new homes continues to be weak, and mortgage availability is still a problem for many prospective homebuyers. However, in the midst of

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    • Part two...

      However, in the midst of this difficult operating environment, we were able to exceed our goal of $1 billion of cash at year-end and exceed our guidance previously provided related to income from operations of break-even to $0.10 per diluted share, exclusive of any impairments or land-related charges. We were also successful in lowering overhead spending and improving our house and land inventory positions. Pulte will continue to focus on generating cash and strengthening the balance sheet as we navigate through this ongoing industry downturn."

      The Company ended the year with $1.1 billion in cash and no debt outstanding under its $1.86 billion revolving credit facility.

      Fourth Quarter Results

      Revenues from homebuilding settlements in the fourth quarter decreased 35% to $2.8 billion, compared with $4.3 billion last year. The change in revenue for the quarter reflects a 31% decrease in closings to 8,714 homes and a 6% decrease in average selling price to $319,000.

      Fourth quarter homebuilding pre-tax loss from continuing operations was $459.2 million, compared with a $34.1 million pre-tax loss for the prior year quarter. The pre-tax loss for the period reflects a decline in gross margins from 11% to less than one percent. Homebuilding SG&A expense decreased $59.3 million, or 19%, compared with the prior year quarter. Homebuilding pre-tax loss for the fourth quarter 2007 is inclusive of approximately $508.9 million of pre-tax charges, or $1.18 per share on an after-tax basis (before consideration of the deferred tax valuation allowance), resulting from adjustments to land inventory and land held for sale, including the Company's investments in unconsolidated joint ventures, and the write-off of deposits and other related costs associated with land transactions the Company no longer plans to pursue. In the fourth quarter of 2006, these charges totaled $349.9 million, or $0.64 per share on an after-tax basis. The homebuilding pre-tax loss for the fourth quarter of 2007 also includes goodwill impairment of $34.4 million, or $0.10 per share on an after-tax basis (before consideration of the deferred tax valuation allowance). An after-tax valuation allowance of $622 million, or $2.46 per share, was recorded during the quarter associated with the Company's deferred tax assets.

      Net new home orders for the fourth quarter were 4,562 homes, valued at $1.2 billion, which represent declines of 29% and 41%, respectively, from prior year fourth quarter results. Pulte Homes' ending backlog as of December 31, 2007 was valued at $2.5 billion (7,890 homes), compared with a value of $3.6 billion (10,255 homes) at the end of last year's fourth quarter.

      The Company's financial services operations reported pre-tax income of $10.3 million for the fourth quarter 2007, compared with $29.7 million of pre- tax income for the prior year's quarter. The decrease in fourth quarter 2007 pre-tax income was primarily due to a 47% decline in mortgage loans originated during the quarter compared with the prior year's quarter. The mortgage capture rate for the quarter was approximately 91%, compared with 93% for the same quarter last year.

      Full Year Results

      For the year 2007, Pulte Homes' loss from

      • 1 Reply to bluecheese4u
      • <<Net new home orders for the fourth quarter were 4,562 homes, valued at $1.2 billion, which represent declines of 29% and 41%, respectively, from prior year fourth quarter results.>>

        Playing with these numbers I get avg selling price now of 269 K.

        value of net new home orders for same Q last yr works out to 2.03 billion with an avg price of 315,953.

        That makes for a decline in avg selling price of 14.8 %.

        Of course many of these new orders may be subject to cancellation.

 
PHM
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