HOV SLUMP EXTENDS WITH $131M LOSS
Red Bank-based Hovnanian Enterprises reported its sixth consecutive quarterly loss yesterday, this time a $131 million shortfall that was double the year-prior amount.
The publicly traded homebuilder, which operates in 19 states, managed to sell more units in its lastest fiscal quarter 3,604 homes, up 10 percent from a year ago but at lower average prices, the company disclosed. As a result, quarterly revenue fell 6.2 percent to $1.09 billion, from $1.17 billion.
From the Associated Press:
“Market conditions remain challenging across many of our markets,” President and Chief Executive Ara K. Hovnanian said in a statement.
The company will continue to reduce inventories, maximize cash flow and shrink overhead, he said.
“Despite the persistence of negative factors impacting the homebuilding industry, we are diligently working to position the company to take advantage of the stronger demand for new homes that will inevitably return once the current housing correction ends,” Hovnanian said.
He did not suggest when that might occur.
Hovnanian issued its report after the stock market closed. Shares rose 7 cents to $8.66 in after-hours trading. The stock has been as high as $31.24 and as low as $4.25 over the past year.
According to Reuters, the company also reported it had negotiated changes to revolving credit, with its maximum borrowing ability reduced to $900 million, down from $1.2 billion, in exchange for “a meaningfully less restrictive covenant package.”
The company did not specify what was less restrictive, but said it would provide further details on a conference call this morning.