Standard Pacific announces Q2 net loss
Standard Pacific reported a net loss of $23.1 million for its second quarter ended June 30, 2009, compared with a net loss of $249.0 million for the year-ago period.
Home-building revenues from continuing operations for the quarter were $289.7 million, down 29% from $410.6 million last year.
The second-quarter results included asset impairment charges of $21.3 million — $13.1 million were related to real estate inventories, and $8.2 million were related to a joint venture. Impairment-related charges for the second quarter were $149.2 million. Excluding asset impairment and restructuring charges, the company had 2009 second-quarter net income of about $2.2 million.
“While we still obviously have not achieved the level of profitability that we ultimately need, we are a lot closer than we were a couple of quarters ago and believe that we are in pretty good shape in the short run because of our higher backlog level,” said Ken Campbell, president and CEO. “However, if we need to adjust further, we will.”
Net new orders (excluding joint ventures and discontinued operations) for the second quarter decreased 6% from the year-ago period to 1,169 new homes on a 29% decrease in the number of average active selling communities from the prior-year period. The company’s cancellation rate was 16%, down from 24% for the first quarter in 2009 and 25% for the second quarter in 2008.
Water experts get down to business
Preserving the nation’s water supply is closely tied to residential water use and lawn care, said a panel of experts during a July 22 teleconference called, “Water and Lawns: Putting Environmentalism to Work in Our Own Backyards.”
Sponsored by the Garden Writers Association (GWA), Alliance for the Great Lakes and Scotts Miracle-Gro Company, the conference provided a forum for these experts to discuss ways the government and environmental groups are improving the quality of the water supply through professional and consumer education in lawn care.
“Most homeowners have lawns, so it’s our position to educate homeowners in best practices,” said Jonah Smith, director of sustainable business for the Alliance for the Great Lakes. More specifically, Smith spoke about the care of mature lawns, keeping track of rainfall to keep from overwatering and avoiding fertilizing before a storm to decrease runoff.
Terril Nell, chair and professor of the University of Florida’s Environmental Horticulture Department, spoke about the tightening of Florida laws on water and fertilizer usage. One recently passed piece of legislation mandates that 150,000 commercial applicators be trained in proper application of fertilizer between now and 2013. Nell also described several long-term goals in his state, including “reducing runoff, protecting the waterfront, attracting wildlife and protecting against erosion.”
Rich Shank, chief environmental officer of Scotts Miracle-Gro, said that his company has a large research and development program focused on increasing the the environmental benefits of lawns and gardens. “We’ve been working with grass seed to come up with drought resistant varieties; improving our slow-release and controlled-release fertilizers; and coming up with organic and hybrid technologies,” Shank said.
Finally, Gary Felton, associate professor at the University of Maryland and a representative of the Chesapeake Bay program, presented a brochure his organization has developed with Scotts Miracle-Gro to show consumers how to conserve water while caring for their lawns. “Our research has shown that people want to do the right thing, but they don’t always know how to do it,” he said.
Nardelli lands new job
Bob Nardelli has a new job. Cerberus Capital Management hired the former Home Depot leader as CEO of Cerberus Operating and Advisory Co. Nardelli had served as CEO of Chrysler since August 2007.
Nardelli will also join Cerberus’ investment committee and valuation committee and will be involved in due diligence projects relating to prospective Cerberus investments.
“Having worked with Bob over the past few years, both at Cerberus and while he was at Chrysler, we are excited to welcome him back to Cerberus,” said Mark Neporent, COO of Cerberus. “Bob is one of the world’s best operating executives and a proven leader. We are pleased and fortunate that he has agreed to take the lead of our COAC team, and to become a member of the key committees through which we manage our business and our portfolio.”
Under Nardelli, Home Depot doubled sales; moved globally into Mexico and China; and delivered more than 20% earnings-per-share growth for four consecutive years, while growing dividends from 16 cents to 90 cents.
His tenure at Home Depot also included a controversy over his pay, his severance package and a top-down management style that was influenced by Six Sigma management theory, which critics say mixed poorly with the company’s service standards.
His tenure at Chrysler, formerly owned by Cerberus, ended with the Chrysler’s Chapter 11 filing and a sale to Fiat. In his new role, Nardelli will watch over companies in which Cerberus has invested.