Ryland shakes up senior management

CALABASAS
April 12, 2007 8:14am

A week after it announced it expected to lose 50 cents to 60 cents a share in the first quarter, two top executives of homebuilder The Ryland Group Inc. (NYSE: RYL) have left the building.

Kip Scott “is leaving” his position as chief operating officer of the company and Mark Beisswanger “is leaving” his position as president of Ryland's West region, the company says.

No reasons were given for the “leavings.”

Mr. Scott had been with the company for 14 years. Mr. Beisswanger had been employed there for six years.

Chad Dreier, chairman, president and CEO, says he’s taking on Mr. Scott’s duties.

Bill Butler, who has been president of Ryland's Denver division since 1996, will become the West region president.

Mr. Dreier also thanked Mr. Beisswanger for his contributions in managing the West region over the past six years.

Based in Calabasas, Ryland is one of the nation's largest homebuilders and mortgage-finance company.

On April 4, Ryland said it expects to report a loss of 50 cents to 60 cents per share for its first quarter of 2007.

The loss is due to an impairment charge of approximately $65 million associated with assets in the company's operations in Fort Myers, Phoenix, Southern California and Washington, D.C.

In addition, the company also expects to write-off the $15 million in goodwill associated with the acquisition of a California homebuilder, MJ Brock & Sons, in 1986, which is substantially all of the company's remaining goodwill, Ryland said.

"At the end of the fourth quarter, we were cautiously optimistic that pricing had begun to stabilize. However, as the first quarter progressed, it became clear that aggressive pricing strategies persisted in several markets, requiring us to write-down the value of some of our assets this quarter," Mr. Dreier said.

Preliminary sales for the first quarter were 2,989 units, down 26 percent from the first quarter of 2006. The cancellation rate as a percent of sales was 28 percent. Ryland closed 1,820 units in the period, compared to 2,686 units in the first quarter of last year.

The Ryland Group will release earnings for the first quarter of 2007 on Wednesday, April 25.