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Toll Brothers Inc. reported higher income for the quarter than expected as it booked a deferred tax asset, and home sales and orders increased.

Net income for the largest U.S. luxury-home builder was $411.4 million, or $2.35 a share, in the three months ended Oct. 31, compared with $15 million, or 9 cents, a year ago, the company said in a statement.
The results included a net benefit of $350.7 million from adding the tax asset to its balance sheet. Excluding the one-time tax benefit, Toll’s earnings were about 30 cents a share, according to Stephen East, an analyst at International Strategy & Investment Group in St. Charles, Mo. The average estimate of 19 analysts in a Bloomberg survey was for earnings of 24 cents a share.
The Horsham, Penn.-based home builder’s tax benefit included the reversal of deferred assets tied to losses during the housing crash.
Toll’s net contracts jumped 70 percent as low interest rates and rising consumer confidence spur demand for new homes after a six-year slump in the U.S. housing market. Construction spending increased more than economists predicted in October as work on homes jumped to the highest level since November 2008, the Commerce Department reported recently.
While orders are up, “we are disappointed in traffic,” said Douglas Yearley Jr., Toll’s chief executive officer, during a conference call with analysts. “I think part of it is that the market is still in the early stages of recovery and we are very encouraged that, as traffic picks up, there’s a great opportunity to increase absorption to have some real pricing power.”
Revenue for the quarter totaled $632.8 million, up 48 percent from a year earlier, the company said. Net contracts signed climbed to 1,098 units from 644 a year earlier. The dollar value jumped to $684.1 million from $390 million, a 75 percent increase. The company’s backlog of properties under contract rose 70 percent to $1.67 billion.
The average price of homes delivered in the quarter was $582,000, up from $565,000 a year earlier.
For fiscal 2013, the company expects to deliver 3,600 to 4,400 homes at an average price of $595,000 to $630,000, according to the statement.
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