Meritage Homes Q4 Profit Down - Update

(RTTNews) - U.S home builder Meritage Homes Corp. (MTH), Wednesday reported a drop in profit for the fourth quarter, as last year's bottom line was boosted by a hefty income tax benefit.

Meritage Homes' fourth-quarter net earnings dropped to $46.1 million or $1.19 per share, down from $95.1 million or $2.49 per share in the prior-year quarter.

On average, 15 analysts polled by Thomson Reuters expected earnings of $1.03 per share for the quarter. Analysts' estimates typically exclude special items.

Results for the quarter include a tax provision of $19.8 million, while last year included a gain of $71.5 million in income tax benefit due to the reversal of deferred tax asset valuation allowances.

Total closing revenues for the quarter rose to $536.2 million from $364.6 million in the same quarter last year. Thirteen Wall Street analysts had a consensus revenue estimate of $537.84 million for the quarter.

Home closing revenue increased 47 percent driven by 18 percent increase in home closings and a 24 percent increase in average sales price over the prior year period. Home closing gross margin increased to 23.2 percent from 18.9 a year ago.

Chief Executive Steven Hilton said, "Our orders and closing volumes grew due to strong demand and a 19% increase in our active communities open at year-end. In addition, rising home prices pushed our total order value and closing revenue to their highest levels in more than five years."

"The homebuilding market strengthened in 2013 as jobs, improved buyer confidence and a shortage of homes for sale drove housing starts higher. We believe market conditions remain positive for continued growth in 2014 and beyond," Hilton continued.

MTH is currently trading at $44.65, down $2.27 or 4.85%, on the NYSE.