Schuler, the last of Hawaii's three publicly held residential developers to report its financial results for the period, showed a turnaround from a loss of $3.1 million in fourth quarter of 1995.
The 1995 loss was primarily a result of a nationally required change in the way home builders account for unsold inventory. The 1996 quarter's operating results were better than those of the year-earlier period.
But sales were down, costs were up and the results showed the continuing sluggishness in the Hawaii economy.
The other two publicly traded isle home builders, Castle & Cooke Inc. and C. Brewer Homes Inc., earlier reported slim profits for the October-December quarter.
All three noted the difficulty of selling homes in Hawaii's poor economy and said they had to cut prices to help sales.
Schuler's fourth-quarter sales of $21.9 million were down 44.6 percent from sales of $39.5 million in the 1995 quarter.
Schuler completed the sale of 132 homes in the three months ended Dec. 31, down 21.4 percent from sales of 168 homes in the 1995 quarter. The company said it had another 28 sales in the latest quarter but did not count them because the no-down payment program in which they were sold did not bring in enough money.
Even with those sales, the total would not have been up to last year's.
Prices were lowered and costs rose. Costs in the fourth quarter equaled 83.4 percent of sales, an increase from 81.8 percent in the 1995 quarter.
James K. Schuler, president, chief executive and chairman, said his company has new strategies to help it become more profitable. One major change that will make 1997 results different from those of 1996 was Schuler's acquisition in January of a Colorado home builder, Melody Homes Inc.
Melody had sales of $94 million in 1996. Schuler said it remains committed to Hawaii's affordable housing market but is also beginning to see income from expansion in Northern California and Oregon.
For the full year 1996, Schuler had a loss of $11.4 million. The change in accounting for inventory wiped out an operating profit. Without it, Schuler would have been able to report a net profit of $3.2 million for 1996, compared with a profit of $7.4 million in 1995.
Schuler sold 497 homes and 17 lots for a total of $93.6 million in 1996, down from 623 homes and 12 lots for $132.9 million in 1995.