On Sept. 25, homebuilding giant Lennar
- The net loss includes a staggering $856.8 million of non-cash write-offs, as unsold homes, land in inventory, and option deposits lose some value every day. These write-offs are a fact of life in the industry, but the year-ago hit was just $76.2 million.
- Come one, come all, and marvel at Lennar's incredible shrinking order backlog: $5.6 billion last year, $2.8 billion last quarter, and $2.2 billion today. Amazing!
- And you should expect that trend to continue: the 5,800 new orders coming in during the quarter can't match the 7,600 homes completed at the same time.
- If you were hoping for some positive regional data that might recommend a more localized homebuilder like Brookfield Homes
(NYSE:BHS) , you're out of luck. Lennar's weakness was spread in a rather uniform layer across the country, region by region.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q3 2007 |
Q3 2006 |
Change |
|
|---|---|---|---|
|
Sales |
$2,342 |
$4,182 |
(44.0%) |
|
Net Profit |
($514) |
$207 |
N/A |
|
EPS |
($3.25) |
$1.30 |
N/A |
|
Diluted Shares |
158.0 |
159.2 |
(0.8%) |
Get back to basics with the income statement.
Margin Checkup
|
Q3 2007 |
Q3 2006 |
Change* |
|
|---|---|---|---|
|
Operating Margin |
2.5% |
11.1% |
(8.6) |
|
Net Margin |
(21.9%) |
4.9% |
(26.8) |
*Expressed in percentage points
Margins are the earnings engine.
Balance Sheet Highlights
|
Assets |
Q3 2007 |
Q3 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$128 |
$144 |
(10.9%) |
|
Total Capital |
$7,669 |
$8,715 |
(12.0%) |
The balance sheet reflects the company's health.
Cash Flow Highlights
The info didn't include a cash flow statement.
Free cash flow is a Fool's best friend.
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