Hovnanian’s national headquarters in Red Bank. (Click to enlarge)
The red ink continued to flow at Red Bank homebuilder Hovnanian Enterprises in the recently ended fiscal fourth quarter, though the size of the loss was smaller than that in the year-prior period.
Hovnanian reported an after-tax net loss of $98.3 million, or 90 cents per share, compared with a $132.1 million loss, or $1.68 per share, in the comparable 2010 period.
It was the 20th loss in the last 21 reporting periods for the publicly traded company, which is New Jersey’s largest homebuilder, according to Bloomberg.com.
For the year ended October 31, the after-tax net loss was $286.1 million, compared with net income of $2.6 million last year. That gain was a result of tax legislation changes that yielded a federal income tax benefit of $291.3 million.
From a Bloomberg report on the results:
Hovnanian, the worst-performing homebuilder stock this year, has depleted cash as it tries to boost margins by buying land at distressed prices. Sales of new U.S. homes are being limited by competition from lower-priced foreclosures and an unemployment rate of 8.6 percent.
“Regardless of what the earnings are, the key metric is how many homes have they sold,” Steve Blitz, senior economist at ITG Investment Research Inc. in New York, said yesterday by telephone. “Their long-term survival is much more dependent on a turnaround in the U.S. housing market than their competitors because they’re much more highly leveraged.”
