M/I Homes posts $7 million 4Q profit on rise in new contracts, tax benefit

M/I Homes posts 4Q profit as contracts increase

COLUMBUS, Ohio — M/I Homes Inc. swung to a fourth-quarter profit on higher revenue driven by an increase in new contracts, sending shares up more than 6 percent Wednesday.

The homebuilder earned $7 million, or 38 cents per share, compared with a loss of $75.4 million, or $5.38 per share, in the fourth quarter last year.

Revenue increased 36 percent, to $204.9 million from $150.2 million. Sales were buoyed by a 32 percent bump in new contracts, while the number of completed sales rose 55 percent.

The quarter’s results included a $31 million tax benefit under a new rule that allows companies to offset past losses. That gain was balanced by $23 million in asset write-downs and $4 million in charges related to imported drywall.

Before taxes, the company said it earned $3 million from operations.

Shares climbed 79 cents, or 6.5 percent, to $12.85, after reaching as high as $13.57 earlier Wednesday.

The fourth-quarter performance helped cut into the company’s losses for the full year. M/I Homes reported a loss of $62.1 million, or $3.71 per share, compared with a loss of $250.3 million, or $17.86 per share, in 2008.

New contracts increased 33 percent from 2008, and the number of completed sales rose 17 percent.

The Columbus, Ohio, builder also posted higher margins as the year progressed, from 12.7 percent in the first quarter to 16.3 percent in the fourth. Expenses fell 20 percent from 2008 levels.

M/I Homes CEO and President Robert H. Schottenstein said the company feels good about its position as it begins 2010.

“Though no one knows when we will begin to see tangible signs of job growth and a stronger economy, we are confident that as conditions improve, we have the right strategy and people to return to profitability,” Schottenstein said in a news release.

M/I Homes has operations in Florida, Illinois, Indiana, Ohio, North Carolina, and the suburbs of Washington.