NEW YORK (Reuters) - Beazer Homes USA Inc (BZH) posted a deeper-than-expected quarterly loss on Friday as the builder labored under the sharpest housing market downturn in decades and a federal investigation of its accounting practices.
The company's fiscal third-quarter loss narrowed to $109.8 million, or $2.85 per share, from a loss of $118.7 million, or $3.09 per share, a year earlier. Analysts' average forecast was a loss of $2.66 per share, according to Reuters Estimates.
Revenue fell 40 percent to $455.6 million but beat analysts' average forecast of $419.5 million. The number of homes sold fell 37 percent to 1,677, while the average sale price was down 8.8 percent to $257,400.
"Potential homebuyers remain reluctant due to eroding consumer confidence amid concerns about employment growth, higher energy costs and the overall economy," said Chief Executive Ian McCarthy.
On Thursday, the National Association of Realtors said U.S. home sales contracts signed in June were down 12.3 percent from a year earlier, although they rose from May, contrary to economists' expectations.
With foreclosures rising and home prices falling, the housing slump has helped push builders into bankruptcy, including on Monday WCI Communities Inc (WCIMQ).
The survivors have had to mark down the value of their inventories and take charges for walking away from land deals. Beazer's results included $118.4 million of such charges.
The deteriorating market has forced builders into a defensive posture, ramping up incentives at the expense of profitability, selling land purchased at boom-time peak prices and negotiating loosened agreements with creditors.
Atlanta-based Beazer ended the third quarter with cash and cash equivalents of $314.2 million, up from $273.7 million as of March 31.
At the end of the quarter on June 30, the company's land supply was down 36 percent from a year earlier to 46,224 lots. It had 300 unsold finished homes, down 32 percent from a year earlier.
Beazer amended its revolving credit facility on August 7. The new facility reduces the amount of money available to the company by $100 million, to $400 million, and interests costs are higher.
But under the amended facility, Beazer must have a tangible net worth -- shareholders' equity minus intangible assets -- of only $100 million. Previously it needed $900 million.
Beazer last year restated financial reports for the period 2003-2006 and had to make adjustments going back to 1999. Fiscal 2007 reports were delayed because of accounting irregularities the company discovered while investigating its mortgage lending practices.
The company is being investigated by a federal prosecutor in North Carolina and the U.S. Securities and Exchange Commission.
(Reporting by Helen Chernikoff; Editing by Derek Caney and John Wallace)
