Lennar Corp., the largest U.S. homebuilder by revenue, said earnings plummeted 73 percent in the fiscal first-quarter as demand waned in the worst housing slump in more than a decade.
Net income for the three months ended Feb. 28 declined to $68.6 million, or 43 cents a share, from $258.1 million, or $1.58, a year earlier, the Miami-based company said today in a statement. Lennar said it will likely miss its 2007 profit forecast as the normally stronger spring selling season had not materialized.
``Given the state of the market, we do not expect to achieve our previously stated 2007 profit goal,'' Chief Executive Officer Stuart Miller said in the statement. ``We are not comfortable providing a new earnings goal at this time.''
Pay particular attention to what the CEO said:
``The housing market continues to demonstrate overall weakness,'' Miller said in today's statement. ``While some markets are performing better than others, the typically stronger spring selling season has not yet materialized. These soft market conditions have been exacerbated by the well-publicized problems in the subprime lending market.''
When industry insiders stop spinning and start using words like "weakness" and "the typical stronger spring selling season has not materialized", you know two things.
1.) It's an accurate statement. CEOs as paid to make positive public statements to support the company and the industry.
2.) Things are pretty damn bad to force that level of straight talk.