Higher home prices boost PulteGroup's quarterly revenue

[BANGALORE] PulteGroup Inc, the No 3 US homebuilder, reported a 4 per cent rise in its quarterly revenue from home sales as the company raised prices for the twelfth straight quarter.

The company's average selling price rose 8 per cent to US$334,000 in the third quarter ended Sept 30.

PulteGroup has boosted revenue by charging more for homes even as it slows the rate at which it builds homes - a step it was forced to take due to a shortage of developed land.

The company reported a 4 per cent fall in homes handed over to customers. PulteGroup said it received orders for 3,779 homes in the quarter, nearly unchanged from a year earlier.

The company also said its board approved a plan to raise its share buyback program by US$750 million. "Our view of the US housing market remains positive, as continued improvements in both the economy and employment provide ongoing support to an industry that continues to benefit from low inventory, low mortgage rates and favorable demographic trends," Chief Executive Richard Dugas said in a statement.

Home sales revenue, which excludes land sale and financial services revenue, rose to US$1.55 billion from US$1.49 billion.

Total revenue rose 0.8 per cent to US$1.59 billion.

However, net income plunged about 94 per cent to US$140.5 million, or 37 cents per share, as the company had a US$2.1 billion tax benefit in the year-earlier quarter.

PulteGroup said it had US$85 million of share buyback remaining from a previous program at the end of the third quarter. REUTERS