NVR, the fourth largest home builder on the 2023 BUILDER 100, reported profits per share of $116.54 in the second quarter, more than $14 per share above consensus analyst projections.
The home builder’s quarterly home building revenue of $2.28 billion, however, was below analyst expectations and represented a 13% year-over-year decrease compared with the second quarter of 2022.
New orders in the second quarter increased by 27% to 5,905 units, while the average sales price of new orders decreased 5% to $447,300. NVR’s cancellation rate in the second quarter improved 300 basis points on a year-over-year basis to 11%. The builder reported gross profit margin in the quarter decreased 200 basis points to 24.3%.
NVR reported settlements in the second quarter decreased 13% to 5,085 units, and the average settlement price remained flat on a year-over-year basis at $449,000. The builder’s backlog of homes sold but not settled as of June 30 decreased on a unit basis by 9% to 11,231 units and decreased on a value basis by 12% to $5.15 billion.
The company reported that closed loan production for mortgages in the second quarter totaled $1.38 billion, a 16% year-over-year decline. Income before tax from the mortgage banking segment totaled $36.5 million in the second quarter, a 25% year-over-year increase. NVR said the increase is primarily attributable to a boost in secondary marketing gains on sales of loans, according to the builder’s quarterly earnings report.
NVR operates in the home building and mortgage banking business segments. The company’s home building segment sells and builds under the Ryan Homes, NVHomes, and Heartland Homes brand names and operates in 35 metros across 15 states and Washington, D.C.
