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Q3 2008 Brookfield Homes Corporation Earnings Conference Call - Final.

Article Excerpt
OPERATOR: Welcome to the Brookfield Homes Corporation conference call and webcast to present the Company's third quarter 2008 results to shareholders. As a reminder, all participants are in a listen-only mode, and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. (OPERATOR INSTRUCTIONS)

At this time, I'd like to turn the conference over to Mr. Ian Cockwell, President and Chief Executive Officer. Please go ahead.

IAN COCKWELL, PRESIDENT AND CEO, BROOKFIELD HOMES CORPORATION: Good afternoon, ladies and gentlemen, and thank you for joining us today for Brookfield Homes' third quarter conference call.

Before we continue, please note that in talking about our financial performance and responding to questions, we may make forward-looking statements. Forward-looking statements are subject to known and unknown risks, and results may differ materially.

For further information on such factors or risks, I would encourage you to see Brookfield Homes' SEC filings and the full text relating to forward-looking statements in our Form 10-K and 10-Qs which are posted on our website. We have also posted a supplementary information package on the website under the Investor Relations section, under Reports and Presentations. It provides details of operations and other key measures of performance.

Joining me for the call today are Paul Kerrigan, our Chief Financial Officer, and Linda Northwood, our Director of Investor Relations. I will start today's agenda, and then turn the call over to Paul, who will review our performance for the third quarter.

More recent challenges in the overall economy and the credit markets have led to further increases in foreclosures, job losses and declining consumer confidence. However, housing affordability and September year-over-year sales of existing homes did improve. Brookfield Home sales pace during the third quarter of 2008 increased when compared to the same period in 2007.

Our focus on monetizing our inventory of developed lots continues with the visibility achieving 100 million of operating cash flow for 2008, being now dependent mainly on home closing backlog.

Given our current level of finished lot inventory, we are not investing any significant amounts in developing the entitled land we own and will in the interim be using the operating cash flow to repay debt. A number of larger land development projects in California and Nevada have faced debt repayment issues and in this regard, we have seen new sources of capital coming into the market to acquire distressed land opportunities. We are still unaware of any major land transactions that have closed in our markets and at this stage the sources of capital are reassessing what is available in the market.

Our management skills in entitling and developing land continues to be sought after by those who wish to enter the market or are wanting to monetize or enhance the value of land assets they may now own. Our business model of adding value at each stage of the land development process enables us to participate in enhancing value for either landowners or financial holders of land. The fundamental shift of economic ownership in land assets should work itself through the markets over the next 12 to 18 months and we are aligning ourselves to participate in these changes in ownership.

I'd now like to turn the call over to Paul, who will discuss our financial performance for the quarter ended September 30, 2008.

PAUL KERRIGAN, CFO, BROOKFIELD HOMES CORPORATION: Thank you, Ian, and good afternoon. For the quarter ended September 30, 2008, Brookfield Homes reported a net loss of $26 million, or $0.95 per share. For the same period in 2007, net income was $2 million or $0.06 per share, of which $25 million or $0.93 per share was from a reversal of income tax liability.

The loss before taxes for the three months ended September 30th was $41 million, compared to $38 million for the same period last...

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