Lennar Posts $30.3 Million Profit in Fourth Quarter, Revenue Up 11%

01/16/2012

Lennar Corporation, one of the nation's largest homebuilders, reported a fourth quarter profit of $30.3 million, on revenues of $952.7 million.

Stuart Miller, Chief Executive Officer of Lennar Corporation, said, "We are pleased to report EPS of $0.16 for our fourth fiscal quarter of 2011, making this our seventh consecutive quarter of profitability. Despite operating in a challenging real estate market, we achieved profitability in all of our business segments."

"During the quarter, we continued to manage our homebuilding business carefully with tight controls over our costs and a focus on improving our gross margins. We benefited greatly from our strategic capital investments in new higher margin communities, which helped us produce a 21.6% gross margin, excluding valuation adjustments, in the fourth quarter."

Mr. Miller continued, "As we come to the end of 2011 and head into 2012, we have seen the market start to stabilize, driven by a combination of low home prices and low interest rates, making the decision to purchase a new home more attractive, compared to the heated rental market. These factors are reflected in our new orders and sales backlog, which increased 20% and 35%, respectively, from the prior year quarter."

"On the Rialto side of our business, our first real estate fund successfully raised $700 million and is now contributing management fees and investment income to our bottom line results. We continue to see significant opportunities to invest in distressed assets for our Rialto business."

Revenues from home sales increased 13% in the fourth quarter of 2011 to $816.5 million from $725.8 million in the fourth quarter of 2010. Revenues were higher primarily due to a 10% increase in the number of home deliveries, excluding unconsolidated entities and a 2% increase in the average sales price of homes delivered. New home deliveries, excluding unconsolidated entities, increased to 3,359 homes in the fourth quarter of 2011 from 3,060 homes last year. The average sales price of homes delivered increased to $243,000 in the fourth quarter of 2011 from $238,000 in the same period last year. Sales incentives offered to homebuyers were $33,900 per home delivered in the fourth quarter of 2011, or 12.2% as a percentage of home sales revenue, compared to $33,700 per home delivered in the fourth quarter of 2010, or 12.4% as a percentage of home sales revenue.