The sluggish market and a higher-than-normal supply of unsold homes prompted Schuler to postpone construction of a third highrise at a Salt Lake condo project. The 159-unit tower had been scheduled to be completed late this year or early next.The company on Wednesday reported net income of $948,000 for the quarter ended March 31, compared with a $4.7 million profit a year earlier. Revenues totaled $20 million, down 45 percent from the 1995 quarter.
The sluggish market and a higher-than-normal supply of unsold homes prompted Schuler to postpone construction of a third highrise at a Salt Lake condo project. The 159-unit tower had been scheduled to be completed late this year or early next.
Amid the bad news there was one bright note: The rate of new-home sales during the first three months of this year increased over the pace during the latter part of 1995, according to Schuler.
Company President James Schuler said the improvement was encouraging. "However, it is too soon to predict whether or not these improved sales rates will be sustainable," he said in a statement.
The company said the first-quarter totals reflected fewer closings of home sales, lower average home prices and lower profit margins.
Schuler closed 93 deals, compared with 167 in the year-earlier period.
The average sales price fell from $238,000 to $232,000.
Schuler's woes have not gone unnoticed.
Standard & Poor's earlier this month downgraded its debt rating on the home builder from stable to negative, citing Schuler's weakened performance in a soft housing market.
A Goldman Sachs & Co. analyst also downgraded the company's stock from "market perform" to "market underperform."
Schuler likewise has lost favor on Wall Street. As recently as October the company stock traded above $12. On Wednesday, it closed at $7.1875, up 6.25 cents.