Ryland 2Q Loss Narrows On Lower Expenses

   DOW JONES NEWSWIRES 
 

Ryland Group Inc.'s (RYL) second-quarter loss narrowed as the company reported fewer charges and lower operating expenses, though homebuilding revenue continued to fall.

The home builder, which operates in 15 states, has reported just one profitable quarter in recent years. It has seen revenue decline of late from year-earlier periods boosted by homebuyers' rush to take advantage of a government tax credit.

High unemployment rates and competition with foreclosed homes, which typically sell at a steep discount, continue to weigh on the battered housing market. Builders NVR Inc. (NVR) and KB Home (KBH) both reported their bottom lines deteriorated in the latest quarter.

Ryland posted a loss of $10.7 million, or 24 cents a share, compared with a year-earlier loss of $21.8 million, or 49 cents a share. The latest period included $8.6 million in charges related to writedowns and other items, while the prior-year result included $19.1 million in charges. Revenue fell 40% to $225.2 million.

Analysts polled by Thomson Reuters had most recently predicted a loss of 21 cents on $227 million in revenue.

Gross margin rose to 15.4% from 13.4% as operating expenses fell 37%.

Homebuilding revenue fell 40%. Housing gross margin, excluding inventory and other valuation adjustments, fell to 14.5% from 15.9%.

New orders increased 11.2% by number of units as closings dropped 42%. The average closing price rose 2.9% to $245,000.

Shares closed at $14.97 on Wednesday, down 4.2%, and were inactive in after-hours trading. The stock is down 13% over the past 12 years.

-By Nathalie Tadena, Dow Jones Newswires; 212-416-3287; [e-mail]