Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Toll Brothers: First profit in 3 years

By Aaron Smith, CNNMoney.com staff writer


NEW YORK (CNNMoney.com) -- Homebuilder Toll Brothers made a profit last quarter -- its first in three years. And it largely has Uncle Sam's tax credits to thank for it.

The company said Wednesday that it earned net income of $27.3 million, or 16 cents per diluted share, for the quarter ending July 31. Last year it lost $472.3 million in the same period in 2009.

Chief Executive Douglas Yearley Jr. said that "much of this quarter's profitability was due to tax benefits."

Toll Brothers (TOL) reduced the pre-tax value of $12.5 million in assets, including already-built subdivisions as well as land cleared for future communities.

Analysts had been expecting the company to suffer another loss.

Revenue fell to $454.2 million in quarter, from $461.4 million the prior year.

The company's stock edged up in pre-market trading.

Toll is the first builder to post quarterly results since the April 30 expiration of the $8,000 tax credit, which boosted homebuilders and the housing market.

The company's quarterly announcement follows a dismal home sales report on Tuesday that aroused fears of a double dip in the housing prices and triggered a slump in the stock market.

Existing home sales sank 27.2% in July to a seasonally adjusted annual rate of 3.83 million units, their lowest level in 15 years, according to the National Association of Realtors. Much of the drop was attributed to the end of the homebuyer tax credit.

More bad news for the housing market came out on Wednesday, when the U.S. Commerce Department reported that new home sales plunged in July to their lowest level on record.

New home sales plummeted 12.4% last month to a seasonally adjusted annual rate of 276,000. This was much worse than expected, as economists had forecasted a gain to 334,000. To top of page


Overnight Avg Rate Latest Change Last Week
30 yr fixed3.83%3.86%
15 yr fixed2.95%2.94%
5/1 ARM3.13%3.05%
30 yr refi3.95%3.98%
15 yr refi3.05%3.05%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 16,643.01 -11.76 -0.07%
Nasdaq 4,828.33 15.62 0.32%
S&P 500 1,988.87 1.21 0.06%
Treasuries 2.19 0.02 0.83%
Data as of 9:22pm ET
Company Price Change % Change
Freeport-McMoRan Inc... 10.50 0.31 3.04%
Bank of America Corp... 16.36 -0.08 -0.49%
Apple Inc 113.29 0.37 0.33%
Intel Corp 28.42 0.70 2.53%
Alcoa Inc 9.41 0.55 6.21%
Data as of 4:03pm ET

Sections

Efforts to unionize low-wage employees of fast-food franchisees and outside contractors get lift from decision of NLRB. More

After Hurricane Katrina, the city of New Orleans had to reinvent the way it manages water and protects itself from future storms. More

The market volatility in China and the U.S. could hit private companies, especially late-stage unicorns. More

How do you run a successful crowdfunding campaign? Indiegogo's CEO Slava Rubin offers his top tips and mistakes to avoid. More

Mom and pop investors are dumping their investments and moving to cash at levels not seen since the financial crisis of 2008. More