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Q4 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 fourth quarter and year end 2008 results to shareholders. (Operator Instructions). At this time, I would like to turn the conference over to Mr. Ian Cockwell, President and Chief Executive Officer. Please go ahead.

IAN COCKWELL, PRESIDENT, CEO, BROOKFIELD HOMES CORPORATION: Good afternoon, ladies and gentlemen, and thank you for joining us today for Brookfield Homes fourth 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 the website. We have also posted a supplementary information package on the website under the investors relations section under reports and presentations. It provides details of operations and other key measures of performance. Joining me for the call are Craig Laurie, 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 Craig to review our performance for the fourth quarter.

With regards to our operations, 2008 was another very challenging year for the housing industry as the downturn in the housing market intensified. Home foreclosures and lack of financing for home buyers resulted in continued high inventory in new and resale homes and sharp decline in new home deliveries. Current supply of resale in new homes far exceeds demand and even though annual single family new home production has dropped below 600,000 units, we do not anticipate that overall equilibrium between housing supply and demand will be reached in 2009. This continuing imbalance, as well as the disruption in credit markets and uncertain economic outlook, has led to continued weak consumer confidence, a critical factor for home sales.

As many home builders continue to migrate to manufacturing platform, land development in our markets is minimal and the lot supplier for new home production is declining. This is leading to a fundamental shift in the ownership and future development of lots. We continue to position ourselves to participate in the increased demand for lots as the longer term demand for new homes returns based on the fundamentals of population growth and the need for replacement homes.

Over the past two years we attempted to differentiate ourselves in the industry and have responded to the challenging market conditions having achieved the following. Our operations have maintained a focus on controlling unentitled land assets with limited capital at risk and creating value through entitling the land. Despite this severity of the housing downturn and having had to address a number of shorter term operational challenges, we have continued our longer term strategic focus on enhancing the value of our land projects. I would now like to turn the call over to Craig who will discuss our financial performance for the year ended December 31, 2008.

CRAIG LAURIE, CFO, BROOKFIELD HOMES CORPORATION: Thank you, Ian, and good afternoon. For the year ended December 31, 2008, our net loss was $116 million, or $4.33 per share compared to net income of $16 million for the comparable period in 2007. The decrease in net income was due to continued challenging market conditions in all of our markets which resulted in impairment charges and write downs on our housing and land assets, an 11% decrease in home closings, and a...

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