D.R. Horton Inc. said Thursday it posted a deep loss in the fiscal third quarter as the homebuilder recorded enormous charges to write down the value of unsold inventory and deposits on land.
The Fort Worth, Texas, company posted a loss of $823.8 million, or $2.62 per share, in the period ended June 30, compared with year-earlier net income of $292.8 million, or 93 cents per share.
The most recent quarter included pretax charges of $835.8 million for inventory impairment and $16.2 million to forfeit deposits on land. Horton said the quarter also included a goodwill impairment charge of $425.6 million.
Analysts expected losses of 35 cents per share, according to Thomson Financial. But the projections by the 10 analysts polled ranged from a loss of $1.34 per share to a profit of 41 cents per share, indicating some included one-time charges in their predictions and some did not.
Revenue from homebuilding fell to $2.5 billion from $3.6 billion, as the number of homes closed plummeted to 9,643 from 13,377.
The company blamed the loss on the persistent housing slump that has left a glut of unsold homes on the market, forcing sharp price reductions. It said higher interest rates and tighter lending standards are also crimping already-soft demand. Looking ahead, Horton did not give any indication about when the market may turn.
“We believe that market conditions will continue to be challenging, and our quarter-end impairment evaluations incorporated our more cautious outlook for the industry,” Chairman Donald Horton said in a statement.