Lennar Corp., the biggest U.S. homebuilder by market value, said fiscal fourth-quarter earnings climbed about 50% as it sold more houses at higher prices.
Net income in the three months through November rose to $245.3 million, or $1.07 a share, from $164.1 million, or 73 cents, a year earlier, the Miami-based company said in a statement today.
Lennar has been able to increase earnings by operating in diverse markets, having a supply of low-cost land and using its large scale to reduce costs, even as
"While a number of macroeconomic factors have contributed to ongoing choppiness in the recovery, with more pressure on sales prices and gross margins, we remain optimistic about the continuation of the recovery," Chief Executive Officer Stuart Miller said in the statement.
Lennar's gross margin on home sales narrowed to 25.6% in the fourth quarter from 26.8% a year earlier, the company said. The number of homes delivered climbed by 23%, while the average sales price rose 7% to $329,000. Sales incentives offered to homebuyers increased to $23,100 per home, or 6.6% of home-sales revenue, from $20,600, or 6.3%, a year earlier.
Lennar builds homes for first-time and move-up buyers, retirees and multiple-generation households in 17 states. It also invests in apartments, master-planned communities, mortgage financing and commercial real estate.
Purchases of new homes across the U.S. declined in November to a four-month low, according to the latest sales figures from the Commerce Department. KB Home shares earlier this week dropped the most in 22 years after the Los Angeles-based company said its profitability will weaken amid rising costs and softening demand. Toll Brothers Inc., the largest U.S. builder of luxury homes, fell the most in almost two years on Dec. 10, after announcing it expected flat sales in 2015 with limited power to raise prices.
Lennar's fourth-quarter orders rose 22% to 5,492 homes. The value of orders increased 24% to $1.8 billion. Revenue climbed 35% to $2.6 billion.
Lennar said its main homebuilding business is well positioned to generate "strong top and bottom-line growth" throughout fiscal 2015.
