FORT WORTH, Texas--(BUSINESS WIRE)--July 26, 2007--D.R. Horton,
Inc. (NYSE:DHI), America's Builder, Thursday (July 26, 2007), reported
a net loss for its third fiscal quarter ended June 30, 2007 of $823.8
million, or $2.62 per diluted share. The quarterly results included
pre-tax charges to cost of sales of $835.8 million for inventory
impairments and $16.2 million for write-offs of deposits and
pre-acquisition costs related to land option contracts that the
Company does not intend to pursue. Additionally, the results included
a pre-tax goodwill impairment charge of $425.6 million. Net income for
the same quarter of fiscal 2006 was $292.8 million, or $0.93 per
diluted share. Homebuilding revenue for the third quarter of fiscal
2007 totaled $2.5 billion, compared to $3.6 billion in the same
quarter of fiscal 2006. Homes closed in the current quarter totaled
9,643, compared to 13,377 homes closed in the year ago quarter.
For the nine months ended June 30, 2007, the Company reported a
net loss totaling $662.3 million, or $2.11 per diluted share. The
nine-month results included pre-tax charges to cost of sales of $943.9
million for inventory impairments and $66.9 million for write-offs of
deposits and pre-acquisition costs related to land option contracts
that the Company does not intend to pursue. Additionally, the results
included a pre-tax goodwill impairment charge of $425.6 million. Net
income for the nine months ended June 30, 2006 was $955.6 million, or
$3.02 per diluted share. Homebuilding revenue for the nine months
ended June 30, 2007 totaled $8.0 billion, compared to $10.0 billion
for the same period of fiscal 2006. Homes closed in the nine-month
period totaled 29,637, compared to 35,838 homes closed in the same
period of fiscal 2006.
The Company's sales backlog of homes under contract at June 30,
2007 was 15,801 homes ($4.4 billion), compared to 24,956 homes ($7.4
billion) at June 30, 2006. As previously reported, net sales orders
for the third quarter ended June 30, 2007 totaled 8,559 homes ($2.0
billion), compared to 14,316 homes ($3.8 billion) for the same quarter
of fiscal 2006. Net sales orders for the first nine months of fiscal
2007 were 27,313 homes ($6.9 billion), compared to 41,550 homes ($11.4
billion) for the same period of fiscal 2006.
Donald R. Horton, Chairman of the Board, said, "Market conditions
in the homebuilding industry continue to be challenging as inventory
levels of both new and existing homes remain at historically high
levels, both as an absolute number and in terms of months' supply.
Increased use of sales incentives continues to put pressure on profit
margins. In addition, home price appreciation over the past few years,
higher interest rates and tightened credit standards in the mortgage
industry are all negatively impacting affordability. Even in the midst
of this volatile housing market, we produced an operating profit
before impairments this quarter and generated positive cash flow from
operations for the fourth consecutive quarter.
"We believe that market conditions will continue to be
challenging, and our quarter-end impairment evaluations incorporated
our more cautious outlook for the industry. For the remainder of
fiscal 2007, we will focus on generating cash, reducing inventory
balances and paying down outstanding debt to maintain a strong balance
sheet."
The Company will host a conference call on Thursday, July 26, 2007
at 10:00 a.m. Eastern Daylight Time. The dial-in number is
800-374-9096, and the call will also be webcast from www.drhorton.com
on the "Investor Relations" page.
D.R. Horton, Inc., America's Builder, is the largest homebuilder
in the United States. Founded in 1978 in Fort Worth, Texas, D.R.
Horton has expanded its presence to include 83 markets in 27 states in
the Northeast, Southeast, South Central, Southwest, California and
West regions of the United States. The Company is engaged in the
construction and sale of high quality homes with sales prices ranging
from $90,000 to over $900,000. D.R. Horton also provides mortgage
financing and title services for homebuyers through its mortgage and
title subsidiaries.
Portions of this document may constitute "forward-looking
statements" as defined by the Private Securities Litigation Reform Act
of 1995. Although D.R. Horton believes any such statements are based
on reasonable assumptions, there is no assurance that actual outcomes
will not be materially different. All forward-looking statements are
based upon information available to D.R. Horton on the date this
release was issued. D.R. Horton does not undertake any obligation to
publicly update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Forward-looking
statements in this release include our expectation that market
conditions will continue to be challenging and that during the
remainder of fiscal 2007 we will focus on generating cash, reducing
inventory balances and paying down outstanding debt to maintain a
strong balance sheet. Factors that may cause the actual results to be
materially different from the future results expressed by the
forward-looking statements include, but are not limited to: changes in
general economic, real estate, construction and other business
conditions; changes in interest rates, the availability of mortgage
financing or increases in the costs of owning a home; governmental
regulations and environmental matters; the Company's substantial debt;
competitive conditions within the industry; the availability of
capital to the Company on favorable terms; the Company's ability to
successfully effect its operational strategies; and warranty and
product liability claims. Additional information about issues that
could lead to material changes in performance is contained in D.R.
Horton's annual report on Form 10-K and most recent quarterly report
on Form 10-Q, which are filed with the Securities and Exchange
Commission.
WEBSITE ADDRESS: www.drhorton.com
D.R. HORTON, INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended Nine Months Ended
June 30, June 30,
-------------------- --------------------
2006 2007 2006 2007
--------- ---------- --------- ----------
($'s in millions, except
per share amounts)
Homebuilding:
Revenues:
Home sales $3,581.4 $ 2,470.5 $9,842.7 $ 7,753.1
Land/lot sales 12.2 77.6 119.2 212.7
-------- --------- -------- ---------
3,593.6 2,548.1 9,961.9 7,965.8
-------- --------- -------- ---------
Cost of sales:
Home sales 2,727.8 2,058.8 7,328.8 6,380.2
Land/lot sales 6.7 65.6 46.2 187.6
Inventory impairments and
land option cost write-
offs 60.9 852.0 71.8 1,010.8
-------- --------- -------- ---------
2,795.4 2,976.4 7,446.8 7,578.6
-------- --------- -------- ---------
Gross profit (loss):
Home sales 853.6 411.7 2,513.9 1,372.9
Land/lot sales 5.5 12.0 73.0 25.1
Inventory impairments and
land option cost write-
offs (60.9) (852.0) (71.8) (1,010.8)
-------- --------- -------- ---------
798.2 (428.3) 2,515.1 387.2
-------- --------- -------- ---------
Selling, general and
administrative expense 356.4 267.5 1,046.9 858.9
Goodwill impairment - 425.6 - 425.6
Loss on early retirement of
debt - 12.1 15.0 12.1
Other (income) (2.9) (3.9) (13.4) (5.7)
-------- --------- -------- ---------
Operating income (loss)
from Homebuilding 444.7 (1,129.6) 1,466.6 (903.7)
-------- --------- -------- ---------
Financial Services:
Revenues 74.2 50.0 206.6 158.3
General and administrative
expense 50.8 36.0 147.6 119.3
Interest expense 8.7 4.1 24.7 20.5
Other (income) (12.8) (8.3) (40.4) (34.2)
-------- --------- -------- ---------
Operating income from
Financial Services 27.5 18.2 74.7 52.7
-------- --------- -------- ---------
Income (loss) before income
taxes 472.2 (1,111.4) 1,541.3 (851.0)
Provision for (benefit from)
income taxes 179.4 (287.6) 585.7 (188.7)
-------- --------- -------- ---------
Net income (loss) $ 292.8 $ (823.8) $ 955.6 $ (662.3)
======== ========= ======== =========
Basic:
Net income (loss) per share $ 0.94 $ (2.62) $ 3.06 $ (2.11)
======== ========= ======== =========
Weighted average number of
common shares 312.8 314.3 312.7 313.9
======== ========= ======== =========
Diluted:
Net income (loss) per share $ 0.93 $ (2.62) $ 3.02 $ (2.11)
======== ========= ======== =========
Weighted average number of
common shares 315.8 314.3 316.7 313.9
======== ========= ======== =========
Other Consolidated Financial
Data:
Interest amortized to home
and land/lot cost of sales $ 60.1 $ 60.8 $ 164.5 $ 171.5
======== ========= ======== =========
Depreciation and
amortization $ 14.3 $ 16.4 $ 40.7 $ 48.3
======== ========= ======== =========
Interest incurred $ 94.1 $ 80.1 $ 260.7 $ 253.0
======== ========= ======== =========
D.R. HORTON, INC.
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
As of June 30,
2007
-----------------
(In millions)
ASSETS
Homebuilding:
Cash and cash equivalents $ 4.9
Inventories:
Construction in progress and finished homes 4,207.5
Residential land and lots - developed and under
development 5,869.5
Land held for development 359.4
Land inventory not owned 150.9
-----------
10,587.3
Property and equipment, net 117.9
Deferred income taxes 735.9
Earnest money and other assets 315.3
Goodwill 153.3
-----------
11,914.6
-----------
Financial Services:
Cash and cash equivalents 55.9
Mortgage loans held for sale 469.0
Other assets 54.5
-----------
579.4
-----------
$ 12,494.0
===========
LIABILITIES
Homebuilding:
Accounts payable $ 807.6
Accrued expenses and other liabilities 982.0
Notes payable 4,598.0
-----------
6,387.6
-----------
Financial Services:
Accounts payable and other liabilities 24.8
Notes payable 318.8
-----------
343.6
-----------
6,731.2
-----------
Minority interests 85.1
-----------
STOCKHOLDERS' EQUITY
Common stock 3.2
Additional capital 1,686.7
Retained earnings 4,083.5
Treasury stock, at cost (95.7)
-----------
5,677.7
-----------
$ 12,494.0
===========
D.R. HORTON, INC.
($'s in millions)
NET SALES ORDERS
Three Months Ended June 30,
---------------------------------
2006 2007
---------------- ---------------
Homes Value Homes Value
------ -------- ----- --------
Northeast 1,979 $510.3 1,148 $308.3
Southeast 2,010 497.1 1,500 323.7
South Central 4,290 744.2 2,541 443.5
Southwest 3,227 880.5 1,894 409.2
California 1,708 805.1 804 307.1
West 1,102 395.8 672 237.0
------ -------- ----- --------
14,316 $3,833.0 8,559 $2,028.8
====== ======== ===== ========
HOMES CLOSED
Three Months Ended June 30,
---------------------------------
2006 2007
---------------- ---------------
Homes Value Homes Value
------ -------- ----- --------
Northeast 2,014 $561.4 1,404 $384.8
Southeast 1,998 494.9 1,575 367.6
South Central 3,656 623.3 2,746 490.7
Southwest 2,839 738.7 2,298 548.0
California 1,818 789.3 913 425.1
West 1,052 373.8 707 254.3
------ -------- ----- --------
13,377 $3,581.4 9,643 $2,470.5
====== ======== ===== ========
D.R. HORTON, INC.
($'s in millions)
NET SALES ORDERS
Nine Months Ended June 30,
------------------------------------
2006 2007
------------------ ----------------
Homes Value Homes Value
------- --------- ------ --------
Northeast 5,663 $1,478.0 3,867 $1,030.6
Southeast 5,845 1,489.1 4,301 961.1
South Central 11,178 1,920.8 7,198 1,282.2
Southwest 9,477 2,535.1 6,364 1,395.0
California 6,037 2,754.2 3,247 1,413.2
West 3,350 1,185.8 2,336 838.9
------- --------- ------ --------
41,550 $11,363.0 27,313 $6,921.0
======= ========= ====== ========
HOMES CLOSED
Nine Months Ended June 30,
------------------------------------
2006 2007
------------------ ----------------
Homes Value Homes Value
------- --------- ------ --------
Northeast 5,441 $1,477.9 4,238 $1,131.8
Southeast 5,621 1,416.6 4,497 1,076.3
South Central 9,192 1,551.6 7,936 1,418.7
Southwest 7,390 1,955.1 7,181 1,733.6
California 5,269 2,394.1 3,534 1,597.4
West 2,925 1,047.4 2,251 795.3
------- --------- ------ --------
35,838 $9,842.7 29,637 $7,753.1
======= ========= ====== ========
SALES ORDER BACKLOG
As of June 30,
----------------------------------
2006 2007
---------------- ----------------
Homes Value Homes Value
------ -------- ------ --------
Northeast 4,116 $1,149.0 2,531 $695.6
Southeast 3,343 981.9 1,952 518.6
South Central 4,961 893.4 3,475 641.3
Southwest 7,155 1,962.8 4,937 1,211.6
California 3,690 1,763.9 1,801 857.6
West 1,691 604.5 1,105 428.3
------ -------- ------ --------
24,956 $7,355.5 15,801 $4,353.0
====== ======== ====== ========
CONTACT:
D.R. Horton, Inc.
Stacey Dwyer, EVP, 817-390-8200
SOURCE:
D.R. Horton, Inc.
