Beazer Homes Posts Profit In Fiscal 4th Quarter

ALEX VEIGA

Beazer Homes USA Inc. reported its first quarterly profit since 2006 on Tuesday and credited more stable home prices and cost cuts for a marked improvement in the homebuilder's gross margins.

The Atlanta-based company also posted an annual increase in new home orders, as low mortgage interest rates and a first-time homebuyer tax credit helped lure buyers. Beazer said it expects orders for the current fiscal year to modestly outpace those of fiscal 2009.

The company said foot traffic slowed somewhat in October as would-be buyers waited for word on whether the government would extend the tax credit. That news came last week as Congress extended the tax incentive through next June, as long as the buyer signs a binding contract by the end of April. The program also was expanded to include a $6,500 credit for existing homeowners who buy a new place after living in their current residence for at least five years.

Beazer saw a jump in the number of shoppers over the weekend in some markets.

"We've got a six-month runway here of a tax credit, great affordability and great mortgage rates," said Ian McCarthy, Beazer's president and chief executive. "It's the industry's job and certainly our job to convince buyers that this is now a great time to buy a Beazer home."