said Tuesday that its second-quarter earnings fell 59% from a year ago, and the homebuilder cut its full-year guidance amid continued deterioration in the U.S. housing market.
Centex earned $137.4 million in the second quarter ended Sept 30, down from $334.5 million a year earlier. Earnings per share from continuing operations tumbled to 70 cents from $2.39 in the prior period.
The results were in line with Centex's lowered guidance earlier this month. On Oct. 12, the company
cut its profit forecast in half for the quarter, estimating per-share earnings of 65 cents to 75 cents.
The bottom line was hurt by increased sales incentives and land impairment charges, which drove down margins in the quarter. Total revenue fell 3% to $3.32 billion from $3.42 billion a year earlier, while homebuilding revenue declined 8% to $2.66 billion.
For the full fiscal year, Centex slashed its earnings forecast to $4 a share from a prior projection of $7. The company earned $9.67 a share in fiscal 2006. Analysts expect fiscal 2007 earnings of $4.17 a share, according to Thomson First Call.
New orders in the quarter fell 29% to 6,828 units. The Southeast and Midwest regions saw the biggest declines.
"We have been aggressively responding to deteriorating market conditions by reducing our controlled lots and aligning our workforce to the new market realities," Centex CEO Tim Eller said in a statement.
"Additionally, we are achieving labor and material cost reductions that should begin to benefit operating margins next fiscal year. These cost reduction measures, along with the expectation for strong cash generation, will continue to position us for market share gains through the cycle."