NEW YORK Reuters U.S. luxury homebuilder Toll Brothers Inc TOL.N bested Wall Street expectations and reported its first profit in three years on Wednesday, helped by tax benefits and lower writedowns on land values.
For its fiscal third quarter ended July 31, Toll reported net income of $27.3 million, or 16 cents per share, compared with a loss of $472.3 million, or $2.93 per share, a year earlier.
Excluding certain one-time items, the company broke even, while analysts, on average, had expected a loss of 14 cents a share, according to Thomson Reuters I/B/E/S. Thomson Reuters I/B/E/S stripped the tax benefit out of its estimate, but some analysts may have included it.
In addition to the tax benefit and a decline in writedowns, lower administrative costs and better margins also contributed to the quarterly performance that surpassed analysts expectations, Credit Suisse analyst Dan Oppenheim wrote in a client note.
Revenue slipped 2 percent to $454.2 million.
Orders fell 16 percent. Builders have reported a decline in demand subsequent to expiration of the federal homebuyer tax credit on April 30, noting that the credit induced buyers to accelerate their decision to purchase a home.
Orders are a leading indicator for homebuilders, who do not book revenue from a sale until they deliver a home.
Horsham, Pennsylvania-based Toll Brothers builds in 21 states, with a focus on the move-up market.
Shares of the company, which have fallen about 32 percent in the last four months, closed at $16.19 Tuesday on the New York Stock Exchange. They touched a 52-week low of $15.57 Tuesday.
Reporting by Archana Shankar in Bangalore; Editing by Gopakumar Warrier and John Wallace
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