ECONOMY

Technical Olympic sees fast US growth

NEW YORK (Reuters) – The head of Technical Olympic USA Inc, one of the fastest growing US home builders, on Friday said he expects earnings from home-building operations to grow by 50 percent in 2006. Chief Executive Antonio Mon expects 2006 earnings, excluding land sales, to increase by about the same rate as the likely level in 2005. Mon expects Technical Olympic, the No 12 US home builder, to post a 2006 profit of $285 million (230 million euros), or $4.42 per share, reiterating a forecast from the beginning of the September. Analysts, on average, expect the company, which is 66 percent owned by Greek general contractor Technical Olympic SA, to post a profit of $4.10 per share, according to Reuters Estimates. Mon said he has not yet seen any effect from Hurricane Katrina on the prices of materials and supplies. But the prices for oil-based products used in home building, such as plastic piping, siding, insulation and roofing material, have been rising throughout the year. Lumber prices have been «volatile,» he said. «We’re reasonably comfortable in looking ahead,» Mon said. On September 21, Citigroup analyst Stephen Kim raised his rating on Technical Olympic, which builds homes in Florida, Virginia, Pennsylvania, Delaware, Texas and Nevada, to «buy» from «hold,» based on valuation. The shares trade at a 2006 price-to-earnings ratio of 6:13, at the low end of the range of the major US home builders.