D.R. Horton said Thursday its fiscal second-quarter earnings fell sharply as conditions in the homebuilding industry remained challenging, prompting the company to write off land-option contracts it doesn't plan to pursue.
Net income fell for the quarter ended March 31 to $51.7 million, or 16 cents a share, from $352.8 million, or $1.11 a share, a year earlier.
The Ft. Worth, Texas-based homebuilder said earnings in the latest period included pretax charges of $67.3 million, or 13 cents a share, for inventory impairments and $13.9 million, or 3 cents a share, for write-offs and costs related to land-option contracts it doesn't intend to pursue.
According to Thomson Financial, analysts on average were expecting the company to earn 27 cents a share.
"Market conditions in the homebuilding industry continue to be challenging in most of our markets as inventory levels of both new and existing homes remain high, and further increases in the use of sales incentives continue to put pressure on profit margins," said Chairman Donald R. Horton in a statement.