NVR North Valley Resources Ltd

RESTON, Va., July 22 /PRNewswire-FirstCall/ -- NVR, Inc. (NYSE:NVR), one of the nation's largest homebuilding and mortgage banking companies, announced net income for its second quarter ended June 30, 2009 of $41,426,000, $6.79 per diluted share. Net income and diluted earnings per share for its second quarter ended June 30, 2009 decreased 19% and 21%, respectively, when compared to the 2008 second quarter. Consolidated revenues for the second quarter of 2009 totaled $625,431,000, a 35% decrease from $955,723,000 for the comparable 2008 quarter. For the six months ended June 30, 2009, consolidated revenues were $1,184,030,000, 36% lower than the $1,843,654,000 reported for the same period of 2008. Net income for the six months ended June 30, 2009 was $59,414,000, a decrease of 37% when compared to the six months ended June 30, 2008. Diluted earnings per share for the six months ended June 30, 2009 was $9.85, a decrease of 39% from $16.10 per diluted share for the comparable period of 2008. Homebuilding New orders in the second quarter of 2009 increased 2% to 2,728 units, when compared to 2,670 units in the second quarter of 2008. The cancellation rate in the quarter ended June 30, 2009 was 14% compared to 19% in the second quarter of 2008 and 15% in the first quarter of 2009. Settlements decreased in the second quarter of 2009 to 2,048 units, 26% less than the same period of 2008. The Company's backlog of homes sold but not settled at the end of the 2009 quarter decreased on a unit basis by 16% to 4,497 units and on a dollar basis by 27% to $1,332,056,000 when compared to the same period last year. Homebuilding revenues for the three months ended June 30, 2009 totaled $612,488,000, 35% lower than the year earlier period. Gross profit margins increased to 19.3% in the 2009 second quarter compared to 17.9% for the same period in 2008. The 2009 second quarter gross profit margin was favorably impacted by the recovery of approximately $4,500,000 of land deposits previously determined to be uncollectible. In the second quarter of 2008, the Company had recorded a $5,800,000 land deposit impairment charge. Income before tax from the homebuilding segment totaled $62,872,000 in the 2009 second quarter, a decrease of 21% when compared to the second quarter of the previous year. Mortgage Banking Mortgage closed loan production of $487,618,000 for the three months ended June 30, 2009 was 18% lower than the same period last year. Operating income for the mortgage banking operations during the second quarter of 2009 decreased 3% to $6,957,000, when compared to $7,155,000 reported for the same period of 2008. Other News The Company reported that it closed the 2009 second quarter with a cash and cash equivalents and marketable security position of $1,241,630,000. Some of the statements in this release made by the Company constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as "believes," "expects," "may," "will," "should" or "anticipates" or the negative thereof or other variations thereof or comparable terminology, or by discussion of strategies, each of which involves risks and uncertainties. All statements other than those of historical facts included herein, including those regarding market trends, NVR's financial position, business strategy, the outcome of pending litigation, projected plans and objectives of management for future operations, are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance of NVR to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements. Such risk factors include, but are not limited to, general economic and business conditions (on both a national and regional level), interest rate changes, access to suitable financing by NVR and by NVR's customers, competition, the availability and cost of land and other raw materials used by NVR in its homebuilding operations, shortages of labor, weather related slow downs, building moratoria, governmental regulation, the ability of NVR to integrate any acquired business, fluctuation and volatility of stock and other financial markets, mortgage financing availability and other factors over which NVR has little or no control. The Company has no obligation to update such forward-looking statements. NVR, Inc. Consolidated Statements of Income (in thousands, except per share data) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, --------------- --------------- 2009 2008 2009 2008 ---- ---- ---- ---- Homebuilding: Revenues $612,488 $941,033 $1,160,817 $1,810,902 Other income 1,750 3,701 4,289 10,100 Cost of sales (494,240) (772,369) (956,870) (1,499,300) Selling, general and administrative (54,664) (89,871) (114,358) (174,037) ------- ------- -------- -------- Operating income 65,334 82,494 93,878 147,665 Interest expense (2,462) (3,232) (5,236) (6,471) ------ ------ ------ ------ Homebuilding income 62,872 79,262 88,642 141,194 ------ ------ ------ ------- Mortgage Banking: Mortgage banking fees 12,943 14,690 23,213 32,752 Interest income 611 869 1,195 1,679 Other income 154 184 243 343 General and administrative (6,475) (8,408) (12,233) (16,062) Interest expense (276) (180) (613) (314) ---- ---- ---- ---- Mortgage banking income 6,957 7,155 11,805 18,398 ----- ----- ------ ------ Income before taxes 69,829 86,417 100,447 159,592 Income tax expense (28,403) (35,085) (41,033) (64,794) ------- ------- ------- ------- Net income $41,426 $51,332 $59,414 $94,798 ======= ======= ======= ======= Basic earnings per share $7.17 $9.58 $10.41 $17.92 ===== ===== ====== ====== Diluted earnings per share $6.79 $8.64 $9.85 $16.10 ===== ===== ===== ====== Basic average shares outstanding 5,777 5,357 5,710 5,290 ===== ===== ===== ===== Diluted average shares outstanding 6,101 5,938 6,032 5,888 ===== ===== ===== ===== NVR, Inc. Consolidated Balance Sheets (in thousands, except share and per share data) June 30, December 31, 2009 2008 ---- ---- (unaudited) ASSETS Homebuilding: Cash and cash equivalents $582,157 $1,146,426 Marketable securities 658,362 - Receivables 9,227 11,594 Inventory: Lots and housing units, covered under sales agreements with customers 416,270 335,238 Unsold lots and housing units 38,537 57,639 Manufacturing materials and other 5,763 7,693 ----- ----- 460,570 400,570 Contract land deposits, net 31,664 29,073 Assets not owned, consolidated per FIN 46R 65,990 114,930 Property, plant and equipment, net 21,660 25,658 Reorganization value in excess of amounts allocable to identifiable assets, net 41,580 41,580 Other assets, net 224,081 242,626 ------- ------- 2,095,291 2,012,457 --------- --------- Mortgage Banking: Cash and cash equivalents 1,111 1,217 Mortgage loans held for sale, net 123,177 72,488 Property and equipment, net 586 759 Reorganization value in excess of amounts allocable to identifiable assets, net 7,347 7,347 Other assets 9,573 8,968 ----- ----- 141,794 90,779 ------- ------ Total assets $2,237,085 $2,103,236 ========== ========== NVR, Inc. Consolidated Balance Sheets (Continued) (in thousands, except share and per share data) June 30, December 31, 2009 2008 ---- ---- (unaudited) LIABILITIES AND SHAREHOLDERS' EQUITY Homebuilding: Accounts payable $142,557 $137,285 Accrued expenses and other liabilities 163,250 194,869 Liabilities related to assets not owned, consolidated per FIN 46R 60,687 109,439 Customer deposits 70,163 59,623 Other term debt 2,388 2,530 Senior notes 135,370 163,320 ------- ------- 574,415 667,066 ------- ------- Mortgage Banking: Accounts payable and other liabilities 17,047 17,842 Notes payable 97,021 44,539 ------ ------ 114,068 62,381 ------- ------ Total liabilities 688,483 729,447 ------- ------- Commitments and contingencies Shareholders' equity: Common stock, $0.01 par value; 60,000,000 shares authorized; 20,559,671 and 20,561,187 shares issued for June 30, 2009 and December 31, 2008, respectively 206 206 Additional paid-in capital 784,080 722,265 Deferred compensation trust - 270,335 and 514,470 shares of NVR, Inc. common stock for June 30, 2009 and December 31, 2008, respectively (44,307) (74,978) Deferred compensation liability 44,307 74,978 Retained earnings 3,690,301 3,630,887 Less treasury stock at cost - 14,758,071 and 15,028,335 shares for June 30, 2009 and December 31, 2008, respectively (2,925,985) (2,979,569) ---------- ---------- Total shareholders' equity 1,548,602 1,373,789 --------- --------- Total liabilities and shareholders' equity $2,237,085 $2,103,236 ========== ========== NVR, Inc. Operating Activity (unaudited) (dollars in thousands) Three Months Ended Six Months Ended June 30, June 30, -------------- ---------------- 2009 2008 2009 2008 ---- ---- ---- ---- Homebuilding data: New orders (units): Mid Atlantic (1) 1,421 1,341 2,624 2,633 North East (2) 246 240 481 520 Mid East (3) 746 726 1,447 1,443 South East (4) 315 363 602 805 --- --- --- --- Total 2,728 2,670 5,154 5,401 ===== ===== ===== ===== Average new order price $294.8 $316.4 $288.7 $318.2 Settlements (units): Mid Atlantic (1) 1,057 1,344 1,985 2,585 North East (2) 197 304 381 549 Mid East (3) 533 639 946 1,256 South East (4) 261 463 509 825 --- --- --- --- Total 2,048 2,750 3,821 5,215 ===== ===== ===== ===== Average settlement price $298.6 $341.7 $303.3 $346.9 Backlog (units): Mid Atlantic (1) 2,415 2,774 North East (2) 403 476 Mid East (3) 1,232 1,300 South East (4) 447 781 --- --- Total 4,497 5,331 ===== ===== Average backlog price $296.2 $341.5 Community count (average) 356 435 357 439 Lots controlled at end of period 44,000 60,500 Mortgage banking data: Loan closings $487,618 $593,867 $914,912 $1,117,405 Capture rate 92% 84% 91% 83% Common stock information: Shares outstanding at end of period 5,801,600 5,424,257 (1) Virginia, West Virginia, Maryland and Delaware (2) Eastern Pennsylvania and New Jersey (3) Western Pennsylvania, Kentucky, New York and Ohio (4) North Carolina, South Carolina and Tennessee DATASOURCE: NVR, Inc. CONTACT: Dan Malzahn of NVR, Inc., +1-703-956-4204 Web Site: http://www.nvrinc.com/

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