Centex reports results for third quarter and nine months.DALLAS--(BUSINESS WIRE)--Jan. 26, 1995--Centex Corporation today announced results for the quarter ended Dec. 31, 1994, the third quarter of the company's 1995 fiscal year, and for the first nine months of fiscal 1995. Dallas-based Centex Centex (NYSE: CTX) began trading publicly in 1969. Since the company’s founding in 1950 as a Dallas-based residential construction company, it has evolved into a company whose principal operations are focused on residential and commercial construction and related , a New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. company (symbol: CTX CTX Context (Management; Tandem) CTX Centex Corporation (stock symbol) CTX Centrex CTX Cyclophosphamide CTX Corporate Trade Exchange CTX Cytoxan CTX Cholera Toxin CTX Clinical Trial Exemption ), is the nation's largest home builder, a leading general building contractor building contractor n → contratista m/f de obras building contractor n → entrepreneur m (en bâtiment) building contractor and has a mortgage banking operation. Centex also owns a 49 percent interest in its former subsidiary, Centex Construction Products, Inc. (CXP CXP Common IFF Digital Transponder Program (US Navy shipboard and aircraft Identification Friend or Foe Transponder) ), a cement cement, binding material used in construction and engineering, often called hydraulic cement, typically made by heating a mixture of limestone and clay until it almost fuses and then grinding it to a fine powder. , aggregate and gypsum gypsum (jĭp`səm), mineral composed of calcium sulfate (calcium, sulfur, and oxygen) with two molecules of water, CaSO4·2H2O. It is the most common sulfate mineral, occurring in many places in a variety of forms. wallboard manufacturer. In addition, prior to Dec. 31, 1994, Centex owned a savings and loan savings and loan n. a banking and lending institution, chartered either by a state or the Federal government. Savings and loans only make loans secured by real property from deposits, upon which they pay interest slightly higher than that paid by most banks. . For the quarter ended Dec. 31, 1994, corporate revenues were $793,205,000, slightly higher than $789,872,000 for the same quarter in the previous fiscal year. Net earnings for the current quarter were $13,057,000, 45 percent less than $23,586,000 for the same quarter last year. Earnings per share for the current quarter were $.44, 39 percent less than $.72 per share for the same quarter in fiscal 1994. Net earnings declined more than earnings per share due to fewer average shares outstanding in the current quarter. For the nine months ended Dec. 31, 1994, corporate revenues totaled $2,481,431,000, a 12 percent increase over $2,209,154,000 for the same period last year. Net earnings for the current nine months, prior to the gain on the April 1994 sale of 51 percent of CXP, were $45,861,000 vs. $63,438,000 for the same period a year ago. Including the gain, Centex's total net earnings for the current nine months were $83,356,000. Earnings per share for the nine months this year, prior to the CXP gain, were $1.49 compared to $1.94 for the same period last year. Including the CXP gain, Centex's total earnings per share were $2.71 for the period this year. CXP completed the sale of 11,730,000 shares, or 51 percent, of its common stock, through an initial public offering in April 1994. Including a dividend and other payments, Centex received $186 million from the transaction and used the funds to reduce its short-term debt Short-term debt Debt obligations, recorded as current liabilities, requiring payment within the year. . HOME BUILDING Home Building revenues for the current quarter were $485.0 million vs. $486.0 million for the same quarter last year. Operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before from Home Building were $24.4 million for the quarter this year, 7 percent less than $26.3 million for the same quarter in fiscal 1994. Home closings for the current quarter totaled 2,994 units, 8 percent less than 3,245 units for the same quarter in the prior year. Unit orders for the quarter this year were 2,223, 22 percent below 2,844 units for the same quarter a year ago. Sales increased in the company's West region but were down substantially in its Southwest Southwest or south west is the ordinal direction halfway between south and west, the opposite of northeast. Southwest or south west may also refer to:
Centex's average home sales price for the quarter this year was $160,331, 8 percent higher than $147,909 for the same quarter in fiscal 1994. Gross margin per closed unit before selling, general and administrative expenses was higher in the current quarter than in the December December: see month. 1993 quarter and in the September September: see month. 1994 quarter. However, the impact of fewer closings in the current quarter than in either of those two quarters resulted in more overhead per unit, and the per unit operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: improved only slightly to $8,133 this year vs. $8,090 for the same quarter a year ago. The Home Building operating margin was 5.02 percent for the current quarter vs. 5.40 percent for the same quarter last year. For the nine months, Home Building revenues were $1.57 billion this year, up 18 percent over $1.33 billion for the same period last year. Operating earnings from Home Building reached an all time high of $84.6 million, 31 percent above $64.4 million for the same period a year ago. Home closings for the current nine months reached 9,696 units, slightly higher than 9,051 units for the same period last year. Unit orders for the nine months were 7,867, down 16 percent from 9,409 units for the same period a year ago. The backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. of homes sold but not closed at Dec. 31, 1994 was 3,966 units, 28 percent less than 5,509 units at Dec. 31, 1993 and 16 percent less than 4,737 units at Sept. 30, 1994. FINANCIAL SERVICES The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. Current quarter revenues from Financial Services, which combines the results of the Mortgage Banking and the Savings and Loan operations, were $27.3 million, down 52 percent from $57.4 million for the same quarter last year. Operating earnings from Financial Services were $4.0 million for the quarter this year, 81 percent less than $21.0 million for the same quarter last year. Of the total, Mortgage Banking had an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $2.1 million this year compared to operating earnings of $20.7 million for the same quarter a year ago. Operating earnings from the Savings and Loan, including $3.2 million from the December 1994 sale of the deposits and branch operations of the Savings and Loan, were $6.1 million for the current quarter vs. $329,000 for the same quarter last year. Centex is no longer in the savings and loan business. Reflecting industry-wide business conditions, Centex's mortgage originations closed for the current quarter totaled 8,223, 49 percent less than 16,050 loan closings for the same quarter last year. Originations for Centex-built homes were 1,851 this year, down 24 percent from a year earlier. "Spot" (third-party) originations declined 53 percent to 6,372 originations in the current quarter. For the nine months, revenues from Financial Services were $94.7 million this year, 39 percent less than $155.4 million for the same period in the prior fiscal year. Operating earnings from Financial Services were $11.0 million for the current nine months, 81 percent less than $59.0 million for the same period a year ago. Of the total, operating earnings from Mortgage Banking were $3.1 million for the period this year compared to $57.6 million for the same period in fiscal 1994. Operating earnings from the Savings and Loan, including proceeds from the sale of the operations, were $7.9 million this year compared to $1.4 million for the nine months last year. Loans closed for the current nine months were 29,883, 35 percent less than loan closings for the same period a year ago. Originations for Centex homes decline 4 percent for the period this year, and spot originations were down 40 percent from those for the similar period in fiscal 1994. Centex said its Mortgage Banking results have been negatively impacted by an increasingly competitive environment. Rapidly rising interest rates virtually stopped refinancing Refinancing An extension and/or increase in amount of existing debt. activity and caused consumers to shift from more profitable fixed-rate mortgages to lower-margin adjustable rate Adjustable rate Applies mainly to convertible securities. Refers to interest rate or dividend that is adjusted periodically, usually according to a standard market rate outside the control of the bank or savings institution, such as that prevailing on Treasury bonds or notes. product. Mortgage profitability also has been affected by the costs associated with downsizing (1) Converting mainframe and mini-based systems to client/server LANs. (2) To reduce equipment and associated costs by switching to a less-expensive system. (jargon) downsizing the organization to match the lower volume of business. CONTRACTING AND CONSTRUCTION SERVICES For the current quarter, revenues from Contracting and Construction Services were $280.9 million, up 14 percent from $246.5 million for the same quarter last year. Contracting and Construction Services reported an operating loss for the current quarter of $570,000 vs. a loss of $1.6 million for the same quarter a year ago. The Contracting and Construction Services business continues to be negatively impacted by competitive pressure on margins. For the nine months, revenues from Contracting and Construction Services of $814.8 million this year were 12 percent higher than $726.6 million for the same period last year. Contracting and Construction Services had an operating loss of $1.7 million for the current nine months vs. a loss of $2.9 million for the same period last year. Centex said its Construction Group received approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $455 million of new contracts for the quarter this year but that prior to the end of the quarter, a previously awarded contract totaling $150 million was put on hold, resulting in net new contracts totaling $305 million. This compares to $398 million of new contracts for the same quarter in the prior fiscal year. The backlog of uncompleted construction contracts at Dec. 31, 1994 was an all-time-high $1.40 billion, 9 percent above the Dec. 31, 1993 backlog of $1.29 billion. CONSTRUCTION PRODUCTS For the current quarter, Centex Corporation's 49 percent "Equity in Earnings of Affiliate Affiliate Relationship between two companies when one company owns substantial interest, but less than a majority of the voting stock of another company, or when two companies are both subsidiaries of a third company. See: Subsidiaries, parent company. (CXP)" was $4.3 million compared to $2.6 million for last year's quarter representing Centex's 100 percent ownership of CXP. For the nine months, Centex's 49 percent "Equity in Earnings of Affiliate (CXP)" was $13.8 million vs. $14.5 million for the similar period a year ago when Centex owned 100 percent of CXP. Construction Products continues to benefit from robust demand and increasing prices for its cement and gypsum wallboard products. OTHER DEVELOPMENTS AND OUTLOOK Centex said that during fiscal 1995, the company has repurchased about 3.25 million shares of common stock, or approximately 10 percent of what was outstanding at the end of fiscal 1994, under its 4.1 million-share stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program. Depending on market conditions, the company will continue to repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. shares under this authorization The right or permission to use a system resource; the process of granting access. See access control. and the Centex Board may authorize To empower another with the legal right to perform an action. The Constitution authorizes Congress to regulate interstate commerce. authorize v. to officially empower someone to act. (See: authority) additional stock repurchases in the future. During the quarter, Centex announced a definitive agreement with Dallas-based Vista Properties, Inc. under which a subsidiary of Centex would acquire equity interests in Vista and in its affiliated af·fil·i·ate v. af·fil·i·at·ed, af·fil·i·at·ing, af·fil·i·ates v.tr. 1. To adopt or accept as a member, subordinate associate, or branch: partnership, Vista Partners, as part of a proposed prepackaged bankruptcy Prepackaged Bankruptcy When acompany prepares a reorganization plan that is negotiated and voted on by creditors and shareholders before the company actually files for bankruptcy. structuring by Vista. For an investment of approximately $65 million, Centex would acquire a portfolio of more than 40 properties, comprising over 4,000 acres in seven states. The land is zoned, planned or developed for: single- and multi-family residential Multi-family residential is a classification of housing where multiple separate housing units are contained within one building. The most common form is an apartment building. Many intentional communities incorporate multi-family residences, such as in cohousing projects. -- 50 percent; office and industrial -- 35 percent; and retail and commercial -- 15 percent. The acquisition would provide Centex with future residential sites in several of its existing markets as well as significant development opportunities in retail, industrial and office segments. The transaction is expected to be completed by summer 1995. Centex said that its home closings and sales will continue to be negatively impacted by the higher interest rate levels, the competitive environment and the liquidation The collection of assets belonging to a debtor to be applied to the discharge of his or her outstanding debts. A type of proceeding pursuant to federal Bankruptcy of excess industry inventory. However, the company said that fiscal 1996 should be positively affected by its expanding base in California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). even though the development and opening of some of its new neighborhoods there could be somewhat delayed due to the recent heavy rains. Centex added that it would continue to downsize Downsize Reducing the size of a company by eliminating workers and/or divisions within the company. Notes: When a company downsizes, it is attempting to find ways to improve efficiency and increase profitability. It is sometimes referred to as trimming the fat. its mortgage banking organization in order to position the operation for profitability at lower volume levels. In addition, the company believes that the flattening of the yield curve Flattening of the yield curve A change in the yield curve when the spread between the yield on long-term and short-term Treasuries has decreased. Compare steepening of the yield curve and butterfly shift. will make the more profitable fixed-rate loans Fixed-rate loan A loan whose rate is fixed for the life of the loan. increasingly attractive to customers. Finally, the company noted that any interest rate reduction could have a positive impact on both its Home Building and Mortgage Banking operations. -0-
Centex Corporation and Subsidiaries
Summary of Consolidated Earnings
(unaudited)
(dollar amounts in thousands, except per share data)
Quarter Ended December 31,
--------------------------------------
1994 1993 Change
----------- ----------- --------
Revenues $ 793,205 $ 789,872 -%
Earnings Before Income Taxes $ 19,311 $ 36,682 (47%)
Net Earnings $ 13,057 $ 23,586 (45%)
Earnings Per Share $ 0.44 $ 0.72 (39%)
Average Shares Outstanding 29,485,220 32,956,169 (11%)
Nine Months Ended December 31,
--------------------------------------
1994 1993 Change
----------- ----------- --------
Revenues $ 2,481,431 $ 2,209,154 12%
Earnings Before Income Taxes $ 131,177(A) $ 101,390 29%
Net Earnings $ 83,356(A) $ 63,438 31%
Earnings Per Share $ 2.71(A) $ 1.94 40%
Average Shares Outstanding 30,722,621 32,734,533 (6%)
(A) The nine months ended Dec. 31, 1994 includes amounts related to Centex Construction Products, Inc.'s (CXP) initial public offering of: Earnings Before Income Taxes, $59,328; Net Earnings, $37,495; and Earnings per Share, $1.22. Centex Corporation and Subsidiaries Revenues and Earnings by Lines of Business (dollars in thousands) Quarter Ended December 31, ------------------------------------------- 1994 1993 Change ------------- ------------- --------- Revenues Home Building $ 485,042 $ 485,995 -% 61% 62% Financial Services (A) 27,258 57,369 (52%) 4% 7% Contracting and Construction Services 280,905 246,508 14% 35% 31% ------------- ------------- Total $ 793,205 $ 789,872 -% 100% 100% ============= ============= Operating Earnings Home Building $ 24,351 $ 26,252 (7%) 77% 55% Financial Services (A) 3,989 20,985 (81%) 12% 44% Contracting and Construction Services (570) (1,588) 64% (2%) (3%) Other, net (398) (490) 19% (1%) (1%) Equity in Earnings of Affiliate (CXP) (B) 4,337 2,617 66% 14% 5% ------------- ------------- Total Operating Earnings 31,709 47,776 (34%) 100% 100% Corporate General Expenses (3,980) (3,646) Interest Expense (8,418) (7,448) ------------- ------------- Earnings Before Income Taxes $ 19,311 $ 36,682 (47%) ============= ============= NOTES: (A) Mortgage Banking and Savings and Loan operations have been combined into a single financial reporting segment -- Financial Services. Operating earnings/(losses) for Mortgage Banking and the Savings and Loan were $(2,160) and $6,149, respectively, for the quarter ended Dec. 31, 1994 and $20,656 and $329 for the 1993 quarter. (B) Centex Construction Products (CXP) became 49 percent owned in April 1994 as a result of its 51 percent Initial Public Offering. CXP's revenues of $136,049 for fiscal 1994 and the related costs and expenses have been reclassified into "Equity in Earnings of Affiliate (CXP)." This reclassification Reclassification The process of changing the class of mutual funds once certain requirements have been met. These requirements are generally placed on load mutual funds. Reclassification is not considered to be a taxable event. facilitates comparisons between the periods. Nine Months Ended December 31, ------------------------------------------- 1994 1993 Change ------------- ------------- --------- Revenues Home Building $ 1,571,897 $ 1,327,134 18% 63% 60% Financial Services (A) 94,731 155,424 (39%) 4% 7% Contracting and Construction Services 814,803 726,596 12% 33% 33% ------------- ------------- Total $ 2,481,431 $ 2,209,154 12% 100% 100% ============= ============= Operating Earnings Home Building $ 84,615 $ 64,381 31% 80% 48% Financial Services (A) 10,987 59,031 (81%) 10% 44% Contracting and Construction Services (1,720) (2,863) 40% (2%) (2%) Other, net (1,306) (1,417) 8% (1%) (1%) Equity in Earnings of Affiliate (CXP) (B) 13,812 14,523 (5%) 13% 11% ------------- ------------- Total Operating Earnings 106,388 133,655 (20%) 100% 100% Corporate General Expenses (11,320) (10,690) Interest Expense (23,219) (21,575) ------------- ------------- Earnings Before Gain on CXP Initial Public Offering and Income Taxes 71,849 101,390 (29%) Gain on CXP Initial Public Offering 59,328 -- ------------- ------------- Earnings Before Income Taxes $ 131,177 $ 101,390 29% ============= ============= NOTES: (A) Mortgage Banking and Savings and Loan operations have been combined into a single financial reporting segment -- Financial Services. Operating earnings for Mortgage Banking and the Savings and Loan were $3,068 and $7,919, respectively, for the nine months ended Dec. 31, 1994 and $57,606 and $1,425 for the 1993 period. (B) Centex Construction Products (CXP) became 49 percent owned in April 1994 as a result of its 51 percent Initial Public Offering. CXP's revenues of $136,049 for fiscal 1994 and the related costs and expenses have been reclassified into "Equity in Earnings of Affiliate (CXP)." This reclassification facilitates comparisons between the periods. Centex Corporation and Subsidiaries Housing Activity by Geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. Area Closings ----------------------------------------- Three Months Ended Nine Months Ended ------------------- ------------------- 12/31/94 12/31/93 12/31/94 12/31/93 -------- -------- -------- -------- West 522 495 1,811 1,366 Midwest 315 324 948 753 East 688 662 2,175 1,890 Southeast Southeast or south east is the ordinal direction halfway between south and east. It the opposite of northwest. Southeast or South East can refer to: Southwest 856 999 2,835 2,959 -------- -------- -------- -------- 2,994 3,245 9,696 9,051 ======== ======== ======== ======== Sales (Orders) Backlog ------------------------------ 12/31/94 9/30/94 12/31/93 -------- -------- -------- West 566 599 612 Midwest 365 504 609 East 948 1,103 1,263 Southeast 965 1,105 1,347 Southwest 1,122 1,426 1,678 -------- -------- -------- 3,966 4,737 5,509 ======== ======== ======== Sales (Orders) ----------------------------------------- Three Months Ended Nine Months Ended ------------------- ------------------- 12/31/94 12/31/93 12/31/94 12/31/93 -------- -------- -------- -------- West 489 434 1,621 1,315 Midwest 176 315 691 901 East 533 589 1,844 1,961 Southeast 473 588 1,505 2,170 Southwest 552 918 2,206 3,062 -------- -------- -------- -------- 2,223 2,844 7,867 9,409 ======== ======== ======== ======== CONTACT: Centex Corporate, Dallas Dallas, city (1990 pop. 1,006,877), seat of Dallas co., N Tex., on the Trinity River near the junction of its three forks; inc. 1871. The second largest Texas city, after Houston, and the eighth largest U.S. Laurence Laurence is the surname or the given name of several people: Surname
or Sheila Sheila is a common given name for a female, taken from the Gaelic name Síle/Sìle, which is believed to be a Gaelic form of Julia or Cecilia. Like "Cecil" or "Cecilia", the name means "Smart and Wise", from the Latin caecus. E. Gallagher Gallagher may refer to: People
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