Toll Brothers Reports Declining Profits Amid Rising Home Contracts
On August 18, Toll Brothers (NYSE:TOL) reported fiscal third-quarter earnings that reflected the current challenges in the housing market. While net income declined to $280.1 million from $369.6 million a year earlier due to thinner margins and fewer completed sales, demand for its luxury homes remained strong with an increase in signed contracts reaching $2.52 billion. The company expanded operations by increasing the number of open communities to 471 compared to 420 last year and maintained shareholder returns through share repurchases totaling $206.8 million and a dividend payment, bringing total fiscal-year buybacks up to $506 million. Despite these efforts, profitability metrics such as home sales gross margin dropped from 25.6% to 23.9%, while selling, general, and administrative costs rose. Toll Brothers also faced challenges with declining deliveries of homes and a reduction in backlog value. The company recorded impairments totaling $67.4 million related to inventory write-downs and land-related issues.
Tickers: $TOL
Topics: earnings report homebuilding real estate shareholder returns