D.R. Horton earnings drop 50%

Home builder D.R. Horton Inc. (NYSI: DHI) today reported net income of $277.7 million for the fourth-quarter of the fiscal year, or 88 cents per diluted share. In fourth-quarter 2005 the company reported net income of $563.8 million, or $1.77 per diluted share.

The company reported 17,261 closed homes in the fourth quarter, compared with 18,622 homes in fourth-quarter 2005. Fourth-quarter consolidated revenue was $4.9 billion, compared with $5.1 billion in fourth-quarter 2005.

For the full fiscal year ended Sept. 30 net income was $1.2 billion, or $3.90 per diluted share, compared with $1.5 billion for the previous year.

Consolidated revenue for the year totaled $15.1 billion, compared with $13.9 billion for fiscal year 2005. The company reported 53,099 total closed homes for the full fiscal year, compared with 51,172 homes for fiscal-year 2005.

The company reported a sales order backlog of 18,125 homes under contract at Sept. 30, 2006, valued at $5.2 billion. That compares with 19,244 homes, valued at $5.8 billion, at Sept. 30, 2005.

Net sales orders for the fourth quarter totaled 10,430 homes ($2.5 billion), compared with 13,950 homes ($3.8 billion) for the same quarter in fiscal-year 2005. Net sales orders for fiscal-year 2006 totaled 51,980 homes ($13.9 billion), compared with 53,232 homes ($14.6 billion) for fiscal year 2005.

Donald R. Horton, chairman of the board, said in a statement, "Our employees continue to work very hard during a time when market conditions are challenging in the home-building industry. We continue to focus on maintaining our strong balance sheet and reducing our inventory."

He noted that the company reduced its total home-building inventory by $662 million in the fourth quarter, and reduced its total homes under construction by about 11 homes. Shareholders' equity grew 20 percent during fiscal-year 2006 to $6.5 billion, contributing to the company's net home-building debt to total capitalization of 40.7 percent at Sept. 30.

The company has expanded its reporting segment disclosures to include six homebuilding reporting regions. The new regions are:

The company has a presence in 84 markets in 27 states and builds homes with sales prices ranging from $90,000 to about $900,000. The company also operates mortgage and title subsidiaries.

As of 9:50 a.m. Eastern Time today, the share price of D.R. Horton stock was at $23.60, compared with $23.80 when the market opened and a close of $22.80 on Monday.

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