Home builder Standard Pacific Corp. on Monday reported a 67% jump in fourth-quarter earnings as strong demand in California and an expansion into the Southeast offset weaker housing markets in Texas and Colorado.
The Irvine-based company said profit in 2003 might top last year's by as much as 20%. In response to healthy demand in key markets, Standard Pacific plans to open nearly 100 new developments this year and build about 7,900 homes -- a 25% increase over 2002.
During the fourth quarter, Standard Pacific reported net income of $52.3 million, or $1.58 a share, compared with $31.3 million, or $1.04 a share, in the year-earlier period. Fourth-quarter revenue increased 57.5% to $683.3 million.
"Going forward, we continue to see excellent opportunities to bolster our strong base of operations in California and Florida as well as pursuing opportunities to expand market share within our established Colorado, Texas and Carolina divisions," said Standard Pacific Chairman and Chief Executive Stephen J. Scarborough.
Standard Pacific shares rose 2%, or 51 cents, to $25.76 in New York Stock Exchange trading Monday.
For the year, net income increased 7% to $118.7 million, or $3.67 per share, compared with $111.1 million, or $3.63 per share, generated in 2002. The company's full-year results were depressed by some one-time charges that reflected the closing of its Houston division and the write-down of some of its Colorado projects. Revenue for the year increased 45.5% to about $2.01 billion
Standard Pacific blamed weak economic conditions in Texas and Colorado for undermining demand for new homes in those regions. During the fourth quarter, the company's home production dropped 7% in Texas and 35% in Colorado.
However, the company's lackluster performance in the central part of the U.S. was more than offset by booming housing markets in California and Arizona, as well as the company's expansion into the Southeast. During the fourth quarter, the company completed 2,378 homes, up nearly 80% on a year-over-year basis. For the entire year, the company's home production rose 45.3% to 6,265.
In Southern California, new-home orders were up 71% during the fourth quarter, and the company ended 2003 with a record backlog of nearly 3,200 homes nationwide that had been sold but not completed.
Standard Pacific said its acquisition last year of three home builders with operations in Florida, North Carolina and South Carolina would play a major role in future growth.