Lennar Corporation (LEN)
Q1 2010 Earnings Call Transcript
March 24, 2010 11:00 a.m. ET

Executives

Scott Shipley – Director of Investor Relations
Stuart Miller – President and Chief Executive Officer
Richard Beckwitt – Executive Vice President
Jeffrey Krasnoff – Chief Executive Officer, Rialto
Bruce E. Gross – Chief Financial Officer

Analysts

David Goldberg – UBS
Dennis McGil – Zelman & Associates
Joshua Pollard – Goldman Sachs
Adam Berger – Wells Fargo Securities
Ray Horn – J.P. Morgan
Josh Levin - Citigroup
Jonathan Ellis – Bank of America/Merrill Lynch
Nishu Sood – Deutsche Bank
Daniel Oppenheim – Credit Suisse

Presentation

Operator

Thank you for standing by and welcome to Lennar''s First Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the presentation, we will conduct a question-and-answer session. Today''s conference call is being recorded. If you have any objections, please disconnect. I will now the turn the call over to Mr. Scott Shipley, Director of Investor Relations for the reading of the forward-looking statement.

Scott Shipley

Good morning. Today''s conference call may include forward-looking statements that are subject to risks and uncertainties relating to Lennar''s future business and financial performance. These forward-looking statements may include statements regarding Lennar''s business, financial condition, results of operation, cash flow, strategies and prospects.

Forward-looking statements represent only Lennar''s estimates on the date of this conference call and are not intended to give any assurance to actual future results. Because forward-looking statements relate to matters that have not yet occurred, these statements are inherently subject to risks and uncertainties.

Many factors could cause Lennar''s actual activities or results to differ materially from the activities and results anticipated in forward looking statements. These factors include those described under the caption Risk Factors contained in Lennar''s annual report on Form 10-K most recently filed with the SEC. Please note that Lennar assumes no obligation to update any forward-looking statements.

Operator

I would like to introduce your speaker for today''s call, Mr. Stuart Miller, President and CEO. Mr. Miller, you may begin.

Stuart A. Miller

Thank you and good morning, everyone. I would like to thank you, first, for joining us for our first quarter 2010 update. This morning I am joined, as always, by Bruce Gross, our Chief Financial Officer, Diane Bessette, our Vice President and Treasurer and David Collins, our Controller. Additionally, I am joined by Rick Beckwitt, our Executive Vice President, and Jeff Krasnoff, the Chief Executive Officer of our Rialto segment.

I am going to begin this morning with some brief opening remarks about the current housing market in general and the progress we have made on managing our balance sheet and joint ventures. Since we have just finished our quarterly operations review with our regional Presidents here in Miami, Rick Beckwitt, who stayed over to participate in this call, will overview our homebuilding operations, while Jon Jaffe, our Chief Operating Officer, is back in California. And then, Jeff Krasnoff will comment on our Rialto segment positioning for 2010 and beyond.

Finally, Bruce will provide additional detail on our numbers. And then we will open the phones to your questions. And as always I would like to request that in our Q&A period everyone please limit to just one question and one follow-up so that we can be as fair as possible to all of our participants.

So let me make a few overview comments about the market and our first quarter. While the new home market and housing in general still face serious headwinds from current economic and legislative conditions, the market and overall economy appear to be continuing to stabilize and are generally in recovery.

As we have expected, at least as it relates to housing, the recovery is not presenting itself as a V-shaped return to better times but instead is proving to be a rocky, stabilizing bottom, with visibility obscured by more questions than clear answers. The overhang of foreclosures and the prospect of additional delinquencies ahead continue to moderate recovery, as shadow inventory continues to be absorbed and then even replenished.