(Recasts with details from conference call)
July 25 (Reuters) - PulteGroup Inc cut its full-year gross margin forecast, mainly due to increased discounting in its Pulte brand amid increased competition and higher lumber prices following wildfires in Canada.
The homebuilder's second-quarter profit, however, beat estimates as it sold more homes at higher average prices.
PulteGroup's shares, which have run up more than 30 percent this year driven by strength in the housing market, were down 1 percent in late morning trading on Tuesday.
Wildfires in Canada's British Columbia, which bills itself as the world's biggest exporter of softwood lumber, are disrupting timber operations during the year's peak building season, resulting in a shortage in supply of wood products.
The increasing number of forest fires in the Canadian province had raised some logistical challenges, Chief Executive Ryan Marshall said on a call, adding that it would continue to pressure costs in the second half of the year.
PulteGroup said discounts increased 80 basis points over last year to $14,000 per home, mainly due to "incremental amount of discounting" in the company's Pulte brand, which typically sells higher-priced homes, in the Southeast region.
The company said it now expects full-year gross margin of about 23.7 percent, down from its previous forecast range of 24 percent to 24.5 percent.
PulteGroup's net income fell about 14 percent to $100.7 million. Excluding a $121 million pre-tax charge related to the sale of underutilized land assets and some other one-time items, the company earned 47 cents per share, beating analysts' average estimate of 41 cents per share, according to Thomson Reuters I/B/E/S.
Pulte, which sells single-family detached homes in the price range of about $100,000 to over $1 million, said the average price of homes rose 6.3 percent to $390,000 in the quarter.
The number of homes sold rose to 5,044 from 4,772.
New orders, a key measure of future revenue for homebuilders, increased 12.3 percent to 6,395 homes, rising the most in the last six months.
Total revenue rose 12.3 percent to $2.02 billion, largely in line with estimates. (Reporting by Arunima Banerjee in Bengaluru; Editing by Sai Sachin Ravikumar and Saumyadeb Chakrabarty)