RESTON, VA -- NVR, Inc., one of the nation's largest homebuilding and mortgage banking companies, announced net income for its first quarter ended March 31, 2014 of $23,849,000. Net income decreased 32% when compared to the 2013 first quarter. Consolidated revenues for the first quarter of 2014 totaled $811,310,000, a 5% increase from $770,256,000 for the comparable 2013 quarter. Income tax expense for the quarter was negatively impacted by $6,879,000 due to the reversal of certain previously recognized tax deductions.
New orders in the first quarter of 2014 decreased 5% to 3,325 units, when compared to 3,510 units in the first quarter of 2013. The cancellation rate in the first quarter of 2014 was 12% compared to 13% in the first quarter of 2013 and 14% in the fourth quarter of 2013. Settlements decreased in the first quarter of 2014 to 2,211 units, 3% lower than the first quarter of 2013. The Company's backlog of homes sold but not settled as of March 31, 2014 decreased on a unit basis by 3% to 6,059 units, but increased on a dollar basis by 4% to $2,270,474,000 when compared to March 31, 2013.
Homebuilding revenues for the three months ended March 31, 2014 totaled $799,187,000, 6% higher than the year earlier period. Gross profit margins increased to 18.0% in the 2014 first quarter compared to 16.9% for the same period in 2013. The increase in selling, general and administrative expenses was primarily due to higher personnel and selling expenses associated with the increase in the number of communities. Income before tax from the homebuilding segment totaled $48,716,000 in the first quarter of 2014, an increase of 11% when compared to the first quarter of 2013.
Mortgage closed loan production of $472,933,000 for the three months ended March 31, 2014 was flat when compared to the first quarter ended March 31, 2013. Operating income for the mortgage banking operations during the first quarter of 2014 decreased 91% to $991,000, when compared to $11,161,000 reported for the first quarter of 2013. Operating income in the first quarter of 2014 was negatively impacted by a more competitive mortgage lending market, resulting in reduced loan profitability. In addition, general and administrative expenses were higher due to increased staffing in response to increased mortgage regulations and expected higher loan volume.
NVR, Inc. operates in two business segments: homebuilding and mortgage banking. The homebuilding unit sells and builds homes under the Ryan Homes, NVHomes, Fox Ridge Homes and Heartland Homes trade names, and operates in twenty-seven metropolitan areas in fourteen states and Washington, D.C. For more information about NVR, Inc. and its brands, see: www.nvrinc.com.