M.D.C. Holdings Third Quarter Numbers | ||
Quarter Three | Fiscal Year | |
Profit/(Loss) | ($31.7 M) –210% | ($79.6 M) –129% |
Home Deliveries | 707 –2% | 1,970 –17% |
New Orders | 595 –25% | 2,364 –14% |
Behind the Numbers:
In the face of some sobering sales numbers, M.D.C. Holdings announced some significant changes to its business model. Rather than quickly adding new communities to increase revenue and market share, the Denver, Colo.–based builder is focusing more on making a profit with what it’s got, CEO Larry A. Mizel announced. He also affirmed M.D.C.’s move to slow speculative home starts. The homes, often stopped at the drywall stage allowing for customer customization, were sitting unsold for too long, hurting the company’s margins. M.D.C. also said it is cutting its large sales promotions because, while they drummed up more contracts, they upped cancellation rates because the contracts didn’t stick. Belt-tightening continued with a 33% cut to administrative headcount, a move expected to save $20 million a year. M.D.C. also announced plans to retire $500 million in debt by the end of 2011.
Learn more about markets featured in this article: Denver, CO.
