January 9, 2019 / 11:37 AM / a year ago

UPDATE 2-Lennar sales miss estimate as housing demand slows

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Jan 9 (Reuters) - Lennar Corp reported lower-than-expected quarterly home sales and orders on Wednesday, as a slowing U.S. housing market hurt demand.

A short supply of homes, rising labor and raw material costs have forced builders to raise prices. This along with rising interest rates led some homebuyers to defer their purchases.

In December, U.S. luxury homebuilder Toll Brothers Inc reported its first fall in quarterly orders in more than four years, citing a sluggish housing market.

“We continue to believe that the housing market is adjusting to a temporary disconnect between sales prices and buyer expectations,” Lennar Executive Chairman Stuart Miller said.

The No. 2 U.S. homebuilder, which acquired smaller rival CalAtlantic last year, said sales surged 64 percent to 14,154 homes in the fourth quarter ended Nov. 30, but were below analysts’ average expectation of 14,485 units, according to IBES data from Refinitiv.

Orders soared 44.2 percent to 10,611 homes, but missed estimate of 11,174 units.

Net income attributable to Lennar rose to $796.1 million, or $2.42 per share, in the quarter, from $309.6 million, or $1.29 per share, a year earlier.

Excluding items, Lennar earned $1.96 per share.

Total revenue rose 70.6 percent to $6.46 billion.

Analysts on average had expected revenue of $6.53 billion and earnings per share of $1.92.

Up to Tuesday’s close, Lennar’s shares had fallen 36.2 percent in the past 12 months, compared with a 27.6 percent decline in the PHLX Housing Index. (Reporting by Ankit Ajmera in Bengaluru; Editing by James Emmanuel)

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