Toll Brothers 4Q net income soars on tax benefit

NEW YORK — Toll Brothers says its fiscal fourth-quarter net income soared, helped by a large income tax benefit and a 48 percent rise in revenue. The homebuilder delivered more homes and its order backlog increased.

CEO Douglas C. Yearley Jr. said in a statement on Tuesday that higher home prices, low interest rates, pent-up demand and improving consumer confidence prompted buyers to return to the housing market this year.

Last week a batch of government reports showed that rising home values, more hiring and lower gas prices pushed consumer confidence in November to the highest level in nearly five years. On Tuesday, Core Logic reported that a measure of U.S. home prices rose 6.3 percent in October compared with a year ago, the largest yearly gain since July 2006.

For the three months ended Oct. 31, Toll Brothers Inc. earned $411.4 million, or $2.35 per share. That’s up sharply from $15 million, or 9 cents per share, a year ago.

The latest quarter included an income tax benefit of $350.7 million.

Excluding the tax benefit and other items, earnings were 35 cents per share.

Analysts expected earnings of 25 cents per share for the quarter, which typically exclude one-time items, according to a FactSet poll.

Revenue increased to $632.8 million from $427.8 million, topping Wall Street’s forecast of $565.1 million.

Homebuilding deliveries climbed 44 percent to 1,088 units, while net signed contracts jumped 70 percent to 1,098 units. The average price of homes delivered increased to $582,000 from $565,000 a year earlier.

Toll Brothers, based in Horsham, Pa., may benefit by catering to the luxury sector. Its target market includes households that typically make more than $100,000 a year, can afford to make a down payment of as much as 30 percent, have great credit record and an unemployment rate about half that of the general population.

Backlog, a measure of potential future revenue, rose 54 percent to 2,569 units. The cancellation rate declined to 4.6 percent from 7.9 percent.

The company’s full-year net income jumped to $487.1 million, or $2.86 per share, from $39.8 million, or 24 cents per share, a year earlier. Annual revenue climbed 27 percent to $1.88 billion from $1.48 billion.

Toll Brothers anticipates delivering between 3,600 and 4,400 homes in 2013 at an average price of $595,000 to $630,000 per home.

Its shares rose 8 cents to $32.51 in midday trading. Its shares peaked for the past year at $37.08 in mid-September.

The company has operations in Arizona, California, Colorado, Connecticut, Delaware, Florida, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Texas, Virginia, and Washington

More in Herald Business Journal

Aerospace workers adjust to changing industry

The number of Boeing workers dropped almost 10 percent since last year.

Tom Hoban
Are millennials warming up to life in suburbia?

They dominate the apartment market and their wants need to be accounted for, says columnist Tom Hoban.

Camano artist mixes flask, paintings for successful cocktail

Art flasks prove popular as bachelorette gifts, birthday presents and wedding favors.

Fluke’s T6 Electrical Testers receives Innovation Awards honor

Fluke’s T6 Electrical Testers have received top honors in the Tools and… Continue reading

Everett volunteer named ‘community champion’ by Molina Healthcare

Everett’s Jorge Galindo was one of seven people across the state to… Continue reading

Cascade Valley Health to hold Festival of Trees in Arlington

Cascade Valley Health Foundation will be holding their fifth annual Festival of… Continue reading

7-Eleven program helped add 500 trees, shrubs to Everett park

Last month, 7-Eleven helped plant more than 500 trees and shrubs at… Continue reading

Pentagon inspector general praises secret $80 billion bomber

US Government Accountability Office in 2016 rejected a protest filed by Boeing-Lockheed Martin.

Everett’s Sentry Credit celebrates a quarter century in business

Sentry Credit Inc. in Everett is celebrating its 25th year in business.… Continue reading

Most Read