TOUSA reports third-quarter loss of $619.7 million
Home builder Technical Olympic USA (TOUSA) reported third-quarter net losses of $619.7 million, wider than the $80 million in losses the company reported last year. Revenue fell 15 percent to $492.9 million from $576.8 million in the same period last year.
The company was hit with $530.6 million in one-time, pre-tax charges related to the abandonment of land option contracts and inventory issues.
TOUSA reported consolidated net sales orders of 892, a 33 percent decrease from last year. The company’s cancellation rate increased to 47 percent, compared to 33 percent for the third quarter of 2006 and 33 percent for the second quarter of 2007.
The New York Stock Exchange has halted trading of the company’s stock, following a drop in stock price to below $1.05. If stocks continue to be low, the company is in danger of being delisted by the NYSE.
Hollywood, Fla.-based TOUSA is a national home builder and financial services company with operations in Florida, the Mid-Atlantic, Texas and the West.
Home Depot sues Los Angeles
Home Depot has filed a lawsuit against Los Angeles, claiming that the city revoked a remodeling permit for political reasons after the company had almost completed a Kmart conversion project. The Atlanta retailer is seeking $10 million in damages and compensation, as well as a lifting of the stop-work order and reinstatement of its permits.
The lawsuit, filed on Nov. 9 in Los Angeles Superior Court, involves a vacant Kmart store in the Sunland-Tujunga community, on the northern edge of Los Angeles. Home Depot took over the lease for the store in 2004 but faced stiff community opposition to its plans to raze the site and build a new unit. In 2006, the city’s building department issued permits for Home Depot to remodel the store instead, but citizens still opposed the project because of concerns over traffic, air quality, noise and possible effects on local businesses.
This past July, the Los Angeles City Council revoked Home Depot’s remodeling permits, saying the project needed an environmental review. The store was 90 percent complete, according to the company.
Home Depot claims that it was singled out for unfavorable treatment and that the city’s action was illegal. It also alleges that the campaign against it was aided by city councilmember Wendy Greuel and a local competitor, a chain of hardware stores called Do-it Centers.
Neither Wendy Greuel nor Do-it Centers, a 10-unit chain based in Chatsworth, Calif., could be reached yesterday for comment. But in a press release issued by her office on Aug. 15, Greuel stated that the Kmart remodel was a “project” involving structural alterations and therefore required a building or change-of-use permit.
Lowe’s to build new flatbed distribution center
Lowe’s Cos. announced plans Monday for a new flatbed distribution center to be built in Purvis, Miss. The facility will serve as the main distribution center for more than 60 Lowe’s stores located in Mississippi, Louisiana, Alabama and Florida.
The nation’s second largest home improvement retailer said that the new 200,000-square-foot facility represents an investment of approximately $15 million and should be fulfilling shipping operations by mid-2008.
“Flatbed distribution centers play a vital role in the state-of-the-art distribution network that keeps Lowe’s stores supplied with the products our customers need,” said Mike Mabry, Lowe’s executive vp-logistics and distribution.
The company currently operates 14 flatbed distribution centers throughout the United States. Lowe’s will release its 2007 third-quarter earnings statement Nov. 19.