Toll Brothers Revenue Drops as Housing Slump Persists

Toll Brothers Inc., the largest U.S. luxury-home builder, reported its eighth consecutive quarterly decline in revenue as demand for new homes tumbled.

New-home sales in the U.S. dropped in March to the lowest in almost 17 years as foreclosures reached a record and banks curtailed lending. The five largest builders have reported a combined $3.3 billion in net losses in their most recent quarters as declining existing-home sales have prevented some potential customers from trading up to new properties.

``The lack of demand right now is a huge challenge,'' said Dave Crossman, an analyst at Kirr Marbach & Co. in Columbus, Indiana, in an interview. ``They're hunkering down, raising liquidity, biding their time until demand returns.''

Kirr Marbach owned about 357,000 Toll shares and had $406 million under management as of March 31.

Toll had $1.23 billion in cash and $1.27 billion available under bank agreements as of April, $343 million more than at the end of the previous quarter. Toll cut its land position to 51,800 lots at the end of the quarter, 43 percent lower than its peak of 91,200 at the end of the fiscal second quarter in 2006.