D.R. Horton, Inc. (
DHI)
Q3 2009 Earnings Call Transcript
August 4, 2009 11:00 a.m. ET
Executives
Donald J. Tomnitz - Vice Chairman, President & Chief Executive Officer
Bill W. Wheat – Director, Executive Vice President & Chief Financial Officer
Stacey H. Dwyer – Executive Vice President & Treasurer
Analysts
Ray Huang - JPMorgan
Megan McGrath - Barclays Capital
David Goldberg - UBS
Joshua Pollard - Goldman Sachs
Nishu Sood - Deutsche Bank
Kenneth Zener – Macquarie Capital Securities
Michael Widner - Stifel Nicolaus & Co.
Josh Levin – Citigroup
Dan Oppenheim - Credit Suisse
Carl Reichardt - Wells Fargo
Alex Barron - Agency Trading Group
Jim Wilson - JMP Securities
Jay McCanless - FTN Equity Capital Markets
Jade Rahmani - KBW
Stephen East - Pali Research
Presentation
Operator
Good morning. My name is Sarah and I will be the conference operator today. At this time, I would like to welcome everyone to the D.R. Horton Incorporated, America''s Builder, third quarter 2009 conference call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star and then the number one on your telephone keypad. If you’d like to withdraw your question, please press the pound key.
I would now like to turn the call over to our CEO, Don Tomnitz. You may begin your conference.
Donald J. Tomnitz
Thank you and good morning. Joining me this morning are Bill Wheat, Executive Vice President and CFO, and Stacey Dwyer, Executive Vice President and Treasurer. Before we get started, Stacey?
Stacey H. Dwyer
Some comments made on this call may constitute forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995, although DR 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 DR Horton on the date of this conference call, and DR Horton does not undertake any obligation to publicly update or revise any forward-looking statements.
Additional information about issues that could lead to material changes in performance is contained in DR Horton''s Annual Report on Form 10-K and the most recent Form 10-Q, both of which were filed with the Securities and Exchange Commission. Don?
Donald J. Tomnitz
Net sales orders for the third quarter were 5,089 homes, down 7.5% from the same quarter in the prior year. Third quarter sales were up 22% sequentially from our March quarter, which is stronger than the usual seasonal trend.
Our average sales price on net sales orders in the quarter decreased approximately 7% from the year-ago quarter to $208,100 but was up sequentially compared to $203,000 in our March quarter. Our cancellation rate improved to 26% from 39% in the year-ago quarter and from 30% in the March quarter.
Our sales backlog were down year-over-year, increased 18.5% sequentially to 5,430 homes or $1.1 billion. Our third quarter home sales revenues were $896.6 million, 4,240 homes compared to $1.4 million, 6,167 homes in the year-ago quarter.
Our average closing price for the quarter decreased approximately 8% from the year ago quarter to $211,500. Stacey?
Stacey H. Dwyer
