Housing demand surge drives DR Horton 2Q profit

DR Horton fiscal 2nd-qtr net income nearly triples, helped by surge in demand for homes

Associated Press

FORT WORTH, Texas (AP) -- D.R. Horton said Friday its fiscal second-quarter net income nearly tripled, boosted by the continued recovery the housing market.

The results came in well ahead of Wall Street predictions and D.R. Horton shares surged in premarket trading.

Homebuilders took a big hit during the Great Recession and the years that followed, but have seen their fortunes improve over the last year as improving economic conditions and record-low interest rates have drawn potential homebuyers back to the market.

"The spring selling season is off to a strong start at D.R. Horton, with robust demand driving higher sales volumes and favorable pricing," Donald Horton, the company's chairman, said in a statement.

For the three months ended March 31, the Fort Worth, Texas-based homebuilder earned $111 million, or 32 cents per share, up from $40.5 million, or 13 cents per share, in the 2012 period.

Homebuilding revenue jumped 49 percent to $1.39 billion from $935.6 million, as the number of homes the company closed on jumped 33 percent to 5,643.

Analysts, on average, expected a profit of 19 cents per share on $1.27 billion in revenue, according to FactSet.

Net sales orders increased 34 percent to 7,879 homes and the value of those orders increased 52 percent to $2 billion.

The company's sales order backlog of homes under contract as of March 31 rose 54 percent to 9,553 homes, while the value of the backlog rose 76 percent to $2.4 billion.

D.R. Horton is the latest homebuilder to report a surge in quarterly profit. On Thursday, PulteGroup Inc., one of the country's largest homebuilders, said it returned to profit during its first quarter, boosted by a surge in homebuilder demand.

D.R. Horton shares rose $1.54, or 6.3 percent, to $26.53 in premarket trading. The stock closed Thursday at $24.53, up 24 percent since the start of the year.

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