Penny Stock Pick Report is pleased to alert investors of stocks on the move. Sign Up for our Stock Newsletter
M.D.C. Holdings, Inc. (NYSE: MDC) recently reported results for its second quarter ended June 30, 2009. The Company announced a net loss for the quarter of $29.6 million, or $0.64 per diluted share, which included a pre-tax charge of $1.2 million for asset impairments. The 2009 second quarter net loss also included a $17.6 million increase in our deferred tax valuation allowance, of which $9.7 million related to a 2006 alternative minimum tax liability associated with our 2008 net operating loss carry back. The net loss for the 2008 second quarter was $100.7 million, or $2.18 per diluted share, which included a pre-tax charge of $88.3 million for asset impairments and an increase in our deferred tax valuation allowance of $43.4 million. Total revenue for the second quarter of 2009 was $195.3 million, compared with revenue of $403.4 million for the same period in 2008.
Larry A. Mizel, MDC's chairman and chief executive officer, stated, "Overall economic conditions in the second quarter remained extremely difficult, as evidenced by a national unemployment rate that now stands at its highest level in more than 25 years. However, we did experience a year-over-year increase in quarterly net home orders for the first time since 2005, and our impairments dropped to a nominal level. In addition, building and sales activity for the industry overall improved from historic lows recorded earlier this year."
Mizel continued, "We are pleased to report that we made significant progress during the second quarter on strategic initiatives designed to strengthen our operating platform. The smaller, more affordable homes that we introduced earlier this year in many of our markets have been well-received by our buyers, with a sales absorption pace exceeding the Company's average. These homes are designed both to meet the current needs of our customers and to allow for a more efficient construction process, and we intend to expand their availability to a larger percentage of our active communities in the future."
"We believe that the strategic production of unsold homes can be very effective if managed properly, and therefore we have built a limited supply of unsold inventory. We generally require construction on the unsold homes to stop at the drywall stage so that the buyers have the opportunity to personalize the homes with upgrades from one of our Home Galleries or design centers. We believe that this strategy will help us to turn our inventories more quickly while we maintain margins similar to those received for a build-to-order home. Because of this strategy, the number of unsold homes available for personalization increased slightly during the quarter. During the same period, we reduced our inventory of finished, unsold homes by more than 70%."
Mizel concluded, "With our cash and investments balance of more than $1.6 billion at the end of the quarter, no borrowings outstanding on our homebuilding line of credit and no senior debt maturities until 2012, we are well positioned with the option to take advantage of market opportunities that may arise. We continue to actively pursue and evaluate potential investments, subjecting each to our rigorous and disciplined investment process and approving only those that we believe will maximize long-term value for our shareholders."
Sign Up for Penny Stock Pick Report’s Free Small Cap Newsletter. To subscribe please enter your email address in the frame at the bottom of this page or visit us at our website.
Subscribe at the bottom of this page.
About Us
Penny Stock Pick Report is a leading stock web site that provides free stock alerts on stocks that are poised to make big gains. We also track small cap companies that could be on the brink of a massive breakout. To feature a company on our web site please contact us at the email listed below.
Penny Stock Pick Report is an independent electronic publication that provides information on selected publicly traded companies. This publication is not a registered investment advisor or broker-dealer. Our affiliates, officers, directors and employees may buy and sell additional shares in any company mentioned herein and may profit in the event those shares rise in value. Please do your own Due Diligence before investing in any of the stocks mentioned above. View our full disclaimer.
