HORSHAM, Pennsylvania ( TheStreet) -- Toll Brothers (TOL - Get Report), the luxury homebuilder, said fiscal third-quarter profit rose 54% as the company recorded a large tax benefit in the latest quarter.
Toll earned $42.1 million, or 25 cents a share, in the third quarter, up from year-earlier earnings of $27.3 million, or 16 cents a share. The latest period included a tax benefit of $38.2 million from the reversal of previously accrued state and federal taxes, compared to a tax benefit of $26.5 million a year earlier.
Revenue fell 13% to $394.3 million, Toll said in a statement Wednesday. Homebuilding deliveries, in units, fell 14%.
Analysts were expecting Toll to post third-quarter revenue of $403.6 million.Toll said third-quarter net signed contracts rose 2% in both dollars and units to $406.7 million and 713. Its cancellation rate was 7.4% in the third quarter, compared with 6.2% a year earlier. Backlog at the end of the third quarter rose 8% to $1.02 billion. The homebuilder said it estimates it will deliver about 620 to 820 homes in the fourth quarter, bringing total deliveries to between 2,475 and 2,675 in the fiscal year. "It is too soon to assess the ramifications of the financial volatility of the past few weeks on the housing market. While late summer is generally not the best time to sell homes, in the short run, the stock market gyrations, the budget impasse, and the U.S. government bond rating downgrade are certainly not helping consumer confidence," said Toll CEO Douglas Yearley, in a statement. "However, we believe that historic low interest rates and the growing imbalance between housing production and demographics-driven demand bode well for the industry sooner or later: The key question, of course, is when." -- Written by Joseph Woelfel
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