UPDATE: Hovnanian Posts FQ2 Loss, Shares Fall
Hovnanian Enterprises (NYSE: HOV) posted a loss in the fiscal second quarter.
Hovnanian's net contracts increased 6.7% to 1,809 homes in the period, while the dollar value of consolidated net contracts gained 15.5% to $669.3 million.
Hovnanian swung to a quarterly loss of $7.9 million, or $0.05 per share, versus a year-ago profit of $1.3 million, or $0.01 per share.
Its revenue surged 6.4% to $449.9 million from $423 million. However, analysts were projecting a profit of $0.03 per share on revenue of $477 million.
Hovnanian's costs and expenses rose 7.5%. Its home-building gross margin, excluding interest, increased to 20.2% versus 18.9%, while deliveries dropped 6.5% to 1,331 homes.
The contract cancellation rate came in at 17%, versus 16%. As of April 30, 2014, the dollar value of consolidated contract backlog rose 21.0% to $1,046.3 million.
The company's press release offered the following comment from J. Larry Sorsby, Chief Financial Officer and Executive Vice President:
"We were pleased with the revenue growth, as well as improvements in our gross margin, that we reported for the second quarter of fiscal 2014."
Hovnanian shares fell 2.29% to $4.47 at 10:10 a.m. ET.
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