Toll Brothers Inc (TOL.N)
said on Wednesday that it expected to report a 51 percent drop in
quarterly homebuilding revenue, but said new orders had improved from
the prior period, reflecting a seasonal upturn.
Preliminary results for the second quarter ended on April 30 showed
homebuilding revenue of about $398.3 million and an order backlog of
about $944.3 million.
Analysts on average were expecting second-quarter revenue of $392.4
million for the luxury homebuilder, according to Reuters Estimates.
Horsham, Pennsylvania-based Toll said its signed contracts jumped
119 percent from the first quarter. The company attributed the rise to
seasonal factors and a particularly weak first quarter that made
Toll's cancellation rate improved to 21.7 percent in the quarter
from 37.1 percent in the first three months of the year and 24.9
percent a year earlier.
Toll said it continued to mothball some sites and decrease the
number of communities it develops, and estimated second quarter pretax
writedowns between $90 million and $160 million.
That was higher than expected, said UBS analyst David Goldberg, who
reduced estimates for the year to a loss of $1.15 per share from $1 as
That said, we continue to believe Toll is well positioned, given
its high quality land and liquidity, Goldberg said in a research note.
Toll shares were up 2.5 percent at $20 in light trading before the market opened.
The company plans to release full second-quarter results on June 3.