* First-quarter orders fall 6 pct to 916 homes
* Cuts top end of 2014 delivery forecast to 5,850
* Says housing demand leveling out from year earlier
* Shares fall as much as 2.2 pct in early trading
Feb 25 Toll Brothers Inc, the largest
U.S. luxury homebuilder, reported a fall in quarterly orders for
the first time in three years as a severe winter deterred
The company also cut the top-end of its 2014 estimate for
finished homes to 5,850 from 6,100.
Toll Brothers' shares fell as much as 2.2 percent in early
"The freezing, snowy weather of the past two months has
impacted our business in the Northeast, mid-Atlantic and Midwest
markets, where about 50 percent of our selling communities are
located," Chief Executive Douglas Yearley said in a statement
Toll Brothers, the only publicly listed luxury homebuilder
until smaller peer WCI Communities Inc went public in
July, had so far outperformed other homebuilders such as D.R.
Horton Inc and PulteGroup Inc as its affluent
customers were less affected by rising mortgage rates.
The company's large land inventory has also allowed it to
ramp up the pace at which it builds, while D.R. Horton and
PulteGroup have had to depend more on raising selling prices to
However, the recent cold weather kept potential buyers at
home and made it more difficult to break ground on new homes.
U.S. housing starts recorded their biggest drop in almost three
years in January.
Toll Brothers said on Tuesday orders dropped 6 percent to
916 homes in the quarter ended Jan. 31, seasonally the slowest
selling period for U.S. homebuilders.
Analyst Wilkes Graham of Compass Point said he had expected
an 18 percent growth in orders.
PulteGroup reported an 18 percent fall in orders booked
during its quarter ended Dec. 31 while D.R. Horton said orders
rose 4 percent.
While the U.S. housing market recovery remains on track,
homebuilders are having to adjust to slowing sales growth after
reaping benefits of the initial surge in demand.
Toll Brothers said demand had leveled more recently against
some very strong comparisons from a year earlier.
However, the company's strong land inventory and its
expanded presence in California make it better positioned than
some other homebuilders to weather the slowdown.
Toll Brothers acquired the home building business of
privately owned Shapell Industries Inc in November, giving it
access to about 5,200 lots in California, the state at the
forefront of the housing market recovery.
Toll Brothers said its selling communities rose 5.8 percent
to 238 in the first quarter.
The company said homes finished rose 24 percent to 928.
Analyst Graham said he expected Toll to finish 1,074 homes in
Revenue soared to $643.7 million from $424.6 million a year
earlier. Net income jumped to $45.6 million, or 25 cents per
share, from $4.4 million, or 3 cents per share.
Toll Brothers' shares were down 1.8 percent at $37.67 on the
New York Stock Exchange on Tuesday. They had gained about 16
percent in the past 12 months to Monday close, outperforming a
13 percent rise in the Dow Jones U.S. Homebuilders index
WCI Communities' shares were down 1.14 percent at $18.97.