TOLL Brothers, the United States luxury home builder, reported its eighth consecutive quarterly decline in revenue yesterday.
Revenue fell to US$818 million in the fiscal second quarter from US$1.17 billion a year earlier, Pennsylvania-based Toll said.
New-home sales in the US dropped in March to the lowest in almost 17 years as foreclosures reached a record and banks curtailed lending.
Toll is also being hurt because potential customers are not selling their current houses and trading up to new, more expensive, properties.
Toll had US$957 million in cash and US$1.2 billion available under bank agreements at the end of January. It was projected to have sales of US$741 million for the three months ended April 30, according to analysts surveyed by Bloomberg.
The shares rose 49 cents to US$23.37 yesterday in New York Stock Exchange composite trading. They were down 16 percent in the 12 months to yesterday, compared to a 41-percent drop in a Standard & Poor's measure of 15 home builders.
The stock is up 17 percent since January 1 on the prospect that Federal Reserve interest rate cuts will bolster demand. The five largest US builders have reported a combined US$3.3 billion in net losses in their most recent quarters.
Standard Pacific Corp reported a first-quarter loss yesterday that was more than double analysts' estimates and said it was considering a possible sale. DR Horton last week reported a record US$1.31 billion second-quarter loss.
The average price of Toll's gross signed contracts in the fiscal first quarter fell 13 percent to US$634,000 from US$730,000 a year earlier.
The median price of a new home in the US in March was US$227,600. Toll got the most revenue last quarter from Delaware, Maryland, Pennsylvania, Virginia and West Virginia.
The company started building homes in 1967 and sold shares to the public in 1986. It operates in 21 US states. It will report complete earnings on June 3.
New-home sales slid 8.5 percent to an annual pace of 526,000 in March, the fewest since October 1991, from 575,000 the month before, according to the Commerce Department. The median sales price slumped 13 percent from the same time last year, the most in nearly four decades.
Sales of previously owned homes in the US fell 2 percent in March to an annual rate of 4.93 million, from 5.03 million in February, according to the National Association of Realtors. The median sales price fell 7.7 percent from a year earlier.
US foreclosure filings more than doubled in the first quarter as payments rose for subprime adjustable mortgages and falling home prices left property owners unable to sell.