Lennar Corp reported a quarterly loss on Thursday as deliveries of new homes and new orders tumbled, but shares of the No 2 US home builder rose because the results were not as bad as analysts had expected.
The net loss came to $88.2 million, or 56 cents per share, in the first quarter ended on February 29, compared with year-earlier earnings of $68.6 million, or 43 cents per share.
Analysts on average had expected a loss of $1.15 per share, according to Reuters Estimates. The latest results included a charge of 38 cents per share for valuation adjustments and write-offs. The US housing market has been in a tailspin for more than two years, hurt by falling prices and evaporating demand. "Market conditions have remained challenged and continued to deteriorate throughout our first quarter," Lennar Chief Executive Stuart Miller said in a statement.
"The pace of overall housing inventory growth is exceeding absorption at the current time," Miller said, adding that market conditions would remain challenging for the near term.
Lennar said first-quarter deliveries fell 60 percent to 3,596 homes. New orders sank 57 percent to 3,045, and the cancellation rate was 26 percent. Revenue dropped 62 percent to $1.1 billion. Positive news was that Lennar was amassing cash and reported low debt levels, said Majestic Research analyst John Tomlinson, but the substantial decline in orders was cause for worry.