Summary
D.R. Horton, Inc. (DHI) operates as one of the largest homebuilding companies in the United States, with operations in 25 states and 73 metropolitan markets. In fiscal year 2011, the company experienced a challenging environment within the homebuilding industry, which had been in a downturn for five consecutive years. Despite a decrease in homebuilding revenues by 18% to $3.5 billion and a 20% decrease in homes closed to 16,695, the company demonstrated resilience. Net sales orders saw a 10% decrease, but the sales order backlog increased by 22% to $1.0 billion, indicating a stabilization in demand towards the latter part of the fiscal year. The company also reported a modest net income of $71.8 million, a significant improvement from the prior year's net income of $245.1 million, largely due to strategic cost management and debt reduction efforts that mitigated the impact of the industry downturn. DHI's financial services segment, primarily DHI Mortgage and title services, contributed to overall revenues, though its performance was also linked to homebuilding activity. The company maintained a strong liquidity position by generating significant cash from operations, reducing inventory, and paying down debt. Looking ahead, D.R. Horton remains focused on managing its costs, optimizing its lot option strategy, and adapting its product mix and pricing to market conditions, positioning itself to benefit from an eventual housing market recovery.
Financial Highlights
36 data points| Revenue | $3.64B |
| Interest Expense | -$51.90M |
| Net Income | $71.80M |
| EPS (Basic) | $0.23 |
| EPS (Diluted) | $0.23 |
| Shares Outstanding (Basic) | 318.30M |
| Shares Outstanding (Diluted) | 318.50M |
Key Highlights
- 1D.R. Horton reported homebuilding revenues of $3.5 billion, a decrease of 18% from the prior year, reflecting the ongoing challenging conditions in the housing market.
- 2The company closed 16,695 homes in fiscal year 2011, a 20% decrease compared to the prior year, with an average closing sales price of $212,200.
- 3Despite a decline in net sales orders by 10%, the sales order backlog increased by 22% to $1.0 billion, indicating potential future revenue growth.
- 4The company maintained a strong liquidity position, with $1.0 billion in homebuilding cash and marketable securities, and reduced its homebuilding debt to $1.6 billion.
- 5D.R. Horton's financial services segment contributed revenues of $87.2 million, with a pre-tax income of $19.1 million.
- 6The company's strategy includes managing sales prices and incentives, controlling SG&A costs, and opportunistically acquiring land and lots to adapt to market demand.
- 7While the overall industry faced challenges, DHI reported a net income of $71.8 million for the fiscal year, demonstrating an ability to manage operations effectively during a downturn.