Beazer posts first quarterly profit in 3 years

NEW YORK (Reuters) - Beazer Homes USA Inc (BZH.N) on Tuesday reported its first quarterly profit in three years, sending its shares up 10 percent.

Demand for the company's new homes was spurred by low prices and low mortgage interest rates and a federal tax credit for first-time home buyers, Chief Executive Ian McCarthy said.

Beazer, which has operations in 16 states, reported a profit of $34 million, or 84 cents per share, for its fiscal fourth quarter that ended September 30, compared with a year-earlier loss of $474 million, or $12.29 per share.

The last time the company posted a quarterly profit was in the three-month period ended in September 2006.

Excluding one-time items, the company lost $1.37 per share, compared with analysts' average forecast of a loss of $1.24 per share, according to Thomson Reuters I/B/E/S.

Revenue was $376.3 million, down from $650 million a year earlier.

Orders rose 2.4 percent year-over-year, and McCarthy said the company expects higher orders in 2010. But he also said rising unemployment and increased foreclosures make it difficult to say if the fragile housing market recovery will last.

"Core margins experienced a particularly sharp turnaround," J.P. Morgan analyst Michael Rehaut wrote in a research note, adding that the company will need to address how it achieved its margin improvement and whether it is sustainable.

Atlanta-based Beazer ended the quarter with unrestricted cash and equivalents of $507 million and said it would use only a "modest" amount of cash in 2010.