Toll brothers, US premium Housebuilders profits sink 85%

Horsham .Pa. based Toll Brothers Inc., largest builder of luxury homes in the US ,(no sub-prime lenders buy their swish places Us$1 Mn. and upwards) said today its Q3 profit dropped 85 % as the housing downturn and credit worries triggered cancellations and hefty writedowns, on sales down 21% from US1.53 Bn. to US$1.21 Bn.

The quarterly cancellation rate, which rose to nearly 24 percent, was greater than at any point in the 21 years the company has been traded publicly.

Earnings for the Q3 ending July sank to US$26.5 Mn. or 16 cents per share, from US$174.6 million, or US$1.07 per share.

The company, which operates principally in Maryland, was forced to write down property at a cost of $88.5 million, or 54 cents per share, compared with $14.6 million, or 9 cents per share, during the year-ago quarter. Excluding writedowns, earnings were 70 cents per share.