MIAMI, FL -- Lennar Corporation, one of the nation's largest homebuilders, today reported results for its third quarter ended August 31, 2011. Third quarter net earnings attributable to Lennar in 2011 were $20.7 million, compared to third quarter net earnings attributable to Lennar of $30.0 million in 2010.
Stuart Miller, Chief Executive Officer of Lennar Corporation, said, "We are pleased to report EPS of $0.11 for our third fiscal quarter of 2011, making this our sixth consecutive quarter of profitability. We generated profits in all of our business segments, despite operating in very challenging economic conditions."
Mr. Miller continued, "On an encouraging note, we have seen demand for home purchases slowly return to the marketplace, driven by low home prices and all-time low interest rates. Limiting that demand is tight and tightening lending standards, high unemployment and low overall consumer confidence, which continue to weigh heavily on the purchase of new homes."
"During the quarter, we continued to focus on our homebuilding business. We benefitted greatly from our strategic capital investments in new high margin communities, which contributed to our gross margin of 21.1%. Our intense focus on efficient business practice through our Everything's Included program, product re-engineering and S,G&A reduction all contributed to a profitable quarter. Our new orders were up 11% year-over-year, representing the first quarterly increase in over five years, excluding the first half of 2010 which had a positive impact from the Federal homebuyer tax credit."
"Our Rialto segment continued to be profitable generating $5.7 million of profit this quarter, despite taking a $10.1 million mark-to-market charge in our PPIP investment. We have successfully completed closings of approximately $600 million of equity commitments for our Rialto Real Estate Fund which will provide capital to help our Rialto segment continue to grow."
Mr. Miller concluded, "We continue to make significant progress in a difficult operating environment as we push forward through the hard work and dedication of our associates. Our strong balance sheet positions us well to capitalize on opportunities and assuming market conditions remain stable, we expect to be profitable again in the fourth quarter and for the year."
New home deliveries, excluding unconsolidated entities, decreased to 2,832 homes in the third quarter of 2011 from 2,909 homes last year. The decrease in home deliveries was primarily in the Company's Homebuilding East and West segments, partially offset by an increase in home deliveries in Homebuilding Other. The average sales price of homes delivered increased to $247,000 in the third quarter of 2011 from $240,000 in the same period last year. Sales incentives offered to homebuyers were $33,600 per home delivered in the third quarter of 2011, or 12.0% as a percentage of home sales revenue, compared to $33,900 per home delivered in the second quarter of 2011, or 12.1% as a percentage of home sales revenue, and $30,600 per home delivered in the third quarter of 2010, or 11.3% as a percentage of home sales revenue.