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TRI Pointe Group, Inc. Reports 2020 First Quarter Results

-New Home Orders up 26% Year-Over-Year- 
-Backlog Dollar Value up 31% Year-Over-Year- 
-Homebuilding Gross Margin Percentage of 20.5%- 
-Diluted Earnings Per Share of $0.24- 
-Ended the Quarter with $678 Million of Total Liquidity-

IRVINE, Calif., April 23, 2020 (GLOBE NEWSWIRE) -- TRI Pointe Group, Inc. (the “Company”) (NYSE:TPH) today announced results for the first quarter ended March 31, 2020.

“While I am extremely pleased with our results this quarter, TRI Pointe Group’s primary focus over the past several weeks has been the health and well-being of its employees, trade partners and customers since the outbreak of COVID-19,” said TRI Pointe Group Chief Executive Officer Doug Bauer.  “As soon as the threat of the virus became evident, we adjusted our business practices to substantially limit in-person interaction and promote social distancing.  Overcoming this pandemic will require everyone’s collective efforts to stop the spread of the virus, and TRI Pointe is dedicated to doing its part.”

Mr. Bauer continued, “The measures we’ve taken as a nation to combat the virus will no doubt have a lasting impact on the economy and our industry.  Fortunately, TRI Pointe enters this period of uncertainty in a position of relative strength, with a quarter-end net debt-to-net capital ratio of 35.4% and over $670 million in cash and available liquidity.  This financial strength, coupled with the experience of our seasoned leadership team in navigating through difficult times, gives me confidence that TRI Pointe is well positioned to deal with the current market environment.”

Mr. Bauer concluded, “From a macro perspective, I remain optimistic about the long-term outlook for our industry post COVID-19.  The demographic shifts occurring in this country have created a need for more housing, while the supply of existing homes remains low.  These two factors, along with my belief in the resiliency of the American economy, give me confidence in the future of our industry and TRI Pointe in particular.”

Results and Operational Data for First Quarter 2020 and Comparisons to First Quarter 2019

  • Net income was $31.9 million, or $0.24 per diluted share, compared to $71,000, or $0.00 per diluted share
  • Home sales revenue of $594.8 million compared to $492.7 million, an increase of 21%
    • New home deliveries of 958 homes compared to 814 homes, an increase of 18%
    • Average sales price of homes delivered of $621,000 compared to $605,000, an increase of 3%
  • Homebuilding gross margin percentage of 20.5% compared to 14.4%, an increase of 610 basis points
    • Excluding interest and impairments and lot option abandonments, adjusted homebuilding gross margin percentage was 23.4%*
  • SG&A expense as a percentage of homes sales revenue of 13.9% compared to 15.7%, a decrease of 180 basis points
  • Net new home orders of 1,661 compared to 1,321, an increase of 26%
  • Active selling communities averaged 140.8 compared to 147.8, a decrease of 5%
    • New home orders per average selling community were 11.8 orders (3.9 monthly) compared to 8.9 orders (3.0 monthly)
    • Cancellation rate of 13% compared to 15%
  • Backlog units at quarter end of 2,455 homes compared to 1,842, an increase of 33%
    • Dollar value of backlog at quarter end of $1.6 billion compared to $1.2 billion, an increase of 31%
    • Average sales price of homes in backlog at quarter end of $659,000 compared to $672,000, a decrease of 2%
  • Ratios of debt-to-capital and net debt-to-net capital of 45.8% and 35.4%*, respectively, as of March 31, 2020
  • Repurchased 6,558,323 shares of common stock at a weighted average price per share of $15.55 for an aggregate dollar amount of $102.0 million in the three months ended March 31, 2020
  • Ended the first quarter of 2020 with total liquidity of $677.5 million, including cash and cash equivalents of $624.1 million and $53.4 million of availability under the Company’s unsecured revolving credit facility

   * See “Reconciliation of Non-GAAP Financial Measures”

“I am extremely pleased with how our team members have adapted to the new reality brought on by the pandemic,” said TRI Pointe Group President and Chief Operating Officer Tom Mitchell.  “We continue to effectively manage all aspects of the business on a day-to-day basis. I am proud that our teams continue to find creative ways to satisfy our customers through sales, construction and service. In many ways, the changes we’ve had to make as an industry play to TRI Pointe’s strengths, thanks to the investments we’ve made in our digital platform. Our ability to market and sell our homes using virtual tools has allowed us to continue to generate sales leads and convert web traffic into orders in this environment.  In addition, we have provided customers with alternatives to conduct their new home closing, from curbside and window signing, to limited power of attorney with their settlement agent and remote online notarization.  We believe our online presence will be a significant asset during this time of limited or no in-person interaction and will have an enduring cost-benefit to our business going forward.”

Outlook

Due to the uncertainty regarding the effects of the COVID-19 pandemic on both the U.S. economy and the Company’s business operations and financial performance, the Company has withdrawn its previously issued guidance for fiscal 2020.

Earnings Conference Call

The Company will host a conference call via live webcast for investors and other interested parties beginning at 5:00 p.m. Eastern Time on Thursday, April 23, 2020.  The call will be hosted by Doug Bauer, Chief Executive Officer, Tom Mitchell, President and Chief Operating Officer, and Glenn Keeler, Chief Financial Officer.

Interested parties can listen to the call live and view the related presentation slides on the internet through the Investors section of the Company’s website at www.TRIPointeGroup.com. Listeners should go to the website at least fifteen minutes prior to the call to download and install any necessary audio software.  The call can also be accessed by dialing 1-877-407-3982 for domestic participants or 1-201-493-6780 for international participants.  Participants should ask for the TRI Pointe Group First Quarter 2020 Earnings Conference Call.  Those dialing in should do so at least ten minutes prior to the start.  The replay of the call will be available for two weeks following the call.  To access the replay, the domestic dial-in number is 1-844-512-2921, the international dial-in number is 1-412-317-6671, and the reference code is #13701509.  An archive of the webcast will be available on the Company’s website for a limited time.

About TRI Pointe Group®

Headquartered in Irvine, California, TRI Pointe Group, Inc. (NYSE: TPH) is a family of premium, regional homebuilders that designs, builds, and sells homes in major U.S. markets. As one of the top 10 largest public homebuilding companies based on revenue in the United States, TRI Pointe Group combines the resources, operational sophistication, and leadership of a national organization with the regional insights, community ties, and agility of local homebuilders. The TRI Pointe Group family includes Maracay® in Arizona, Pardee Homes® in California and Nevada, Quadrant Homes® in Washington, Trendmaker® Homes in Texas, TRI Pointe Homes® in California, Colorado and the Carolinas, and Winchester® Homes* in Maryland and Virginia. TRI Pointe Group was named 2019 Builder of the Year by Builder and Developer magazine, recognized in Fortune magazine’s 2017 100 Fastest-Growing Companies list, and garnered the 2015 Builder of the Year Award by Builder magazine. The company was also named one of the Best Places to Work in Orange County by the Orange County Business Journal in 2016, 2017, 2018 and 2019. For more information, please visit www.TriPointeGroup.com.

*Winchester is a registered trademark and is used with permission.

Forward-Looking Statements

Various statements contained in this press release, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact, are forward-looking statements.  These forward-looking statements may include, but are not limited to, statements regarding our strategy, projections and estimates concerning the timing and success of specific projects and our future production, land and lot sales, operational and financial results, including our estimates for growth, financial condition, sales prices, prospects, and capital spending.  Forward-looking statements that are included in this press release are generally accompanied by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “future,” “goal,” “guidance,” “intend,” “likely,” “may,” “might,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “strategy,” “target,” “will,” “would,” or other words that convey future events or outcomes.  The forward-looking statements in this press release speak only as of the date of this press release, and we disclaim any obligation to update these statements unless required by law, and we caution you not to rely on them unduly.  These forward-looking statements are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control.  The following factors, among others, may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements: the effects of the ongoing COVID-19 pandemic, which are highly uncertain, cannot be predicted and will depend upon future developments, including the severity of COVID-19 and the duration of the outbreak, the duration of existing social distancing and shelter-in-place orders, further mitigation strategies taken by applicable government authorities, the availability of a vaccine, adequate testing and treatments and the prevalence of widespread immunity to COVID-19; the impacts on our supply chain, the health of our employees, service providers and trade partners, and the reactions of U.S. and global markets and their effects on consumer confidence and spending; the effect of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages and strength of the U.S. dollar; market demand for our products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions; the availability of desirable and reasonably priced land and our ability to control, purchase, hold and develop such parcels; access to adequate capital on acceptable terms; geographic concentration of our operations, particularly within California; levels of competition; the successful execution of our internal performance plans, including restructuring and cost reduction initiatives; raw material and labor prices and availability; oil and other energy prices; the effect of U.S. trade policies, including the imposition of tariffs and duties on homebuilding products and retaliatory measures taken by other countries; the effect of weather, including the re-occurrence of drought conditions in California; the risk of loss from earthquakes, volcanoes, fires, floods, droughts, windstorms, hurricanes, pest infestations and other natural disasters, and the risk of delays, reduced consumer demand, and shortages and price increases in labor or materials associated with such natural disasters; the risk of loss from acts of war, terrorism or outbreaks of contagious diseases, such as COVID-19; transportation costs; federal and state tax policies; the effect of land use, environment and other governmental laws and regulations; legal proceedings or disputes and the adequacy of reserves; risks relating to any unforeseen changes to or effects on liabilities, future capital expenditures, revenues, expenses, earnings, synergies, indebtedness, financial condition, losses and future prospects; changes in accounting principles; risks related to unauthorized access to our computer systems, theft of our homebuyers’ confidential information or other forms of cyber attack; and additional factors discussed under the sections captioned “Risk Factors” included in our annual and quarterly reports filed with the Securities and Exchange Commission.  The foregoing list is not exhaustive.  New risk factors may emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business.

Investor Relations Contact:

Chris Martin, TRI Pointe Group
Drew Mackintosh, Mackintosh Investor Relations
InvestorRelations@TRIPointeGroup.com, 949-478-8696

Media Contact:
Carol Ruiz, cruiz@newgroundco.com, 310-437-0045


KEY OPERATIONS AND FINANCIAL DATA
(dollars in thousands)
(unaudited)

  Three Months Ended March 31,
  2020   2019   Change   % Change
Operating Data:              
Home sales revenue $ 594,838     $ 492,703     $ 102,135     20.7 %
Homebuilding gross margin $ 121,956     $ 71,167     $ 50,789     71.4 %
Homebuilding gross margin % 20.5 %   14.4 %   6.1 %    
Adjusted homebuilding gross margin %* 23.4 %   18.4 %   5.0 %    
SG&A expense $ 82,474     $ 77,586     $ 4,888     6.3 %
SG&A expense as a % of home sales revenue 13.9 %   15.7 %   (1.8 )%    
Net income $ 31,883     $ 71     $ 31,812     44,805.6 %
Adjusted EBITDA* $ 67,956     $ 28,150     $ 39,806     141.4 %
Interest incurred $ 20,779     $ 23,373     $ (2,594 )   (11.1 )%
Interest in cost of home sales $ 16,822     $ 14,191     $ 2,631     18.5 %
               
Other Data:              
Net new home orders 1,661     1,321     340     25.7 %
New homes delivered 958     814     144     17.7 %
Average sales price of homes delivered $ 621     $ 605     $ 16     2.6 %
Cancellation rate 13 %   15 %   (2 )%    
Average selling communities 140.8     147.8     (7.0 )   (4.7 )%
Selling communities at end of period 143     146     (3 )   (2.1 )%
Backlog (estimated dollar value) $ 1,618,481     $ 1,237,838     $ 380,643     30.8 %
Backlog (homes) 2,455     1,842     613     33.3 %
Average sales price in backlog $ 659     $ 672     $ (13 )   (1.9 )%
               
  March 31,   December 31,        
  2020   2019   Change   % Change
Balance Sheet Data: (unaudited)            
Cash and cash equivalents $ 624,129     $ 329,011     $ 295,118     89.7 %
Real estate inventories $ 3,194,148     $ 3,065,436     $ 128,712     4.2 %
Lots owned or controlled 32,007     30,029     1,978     6.6 %
Homes under construction (1) 2,564     2,269     295     13.0 %
Homes completed, unsold 308     343     (35 )   (10.2 )%
Debt $ 1,784,925     $ 1,283,985     $ 500,940     39.0 %
Stockholders’ equity $ 2,115,281     $ 2,186,530     $ (71,249 )   (3.3 )%
Book capitalization $ 3,900,206     $ 3,470,515     $ 429,691     12.4 %
Ratio of debt-to-capital 45.8 %   37.0 %   8.8 %    
Ratio of net debt-to-net capital* 35.4 %   30.4 %   5.0 %    

__________
(1)  Homes under construction included 55 and 78 models at March 31, 2020 and December 31, 2019, respectively.
*  See “Reconciliation of Non-GAAP Financial Measures”


CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)

  March 31,   December 31,
  2020   2019
Assets (unaudited)    
Cash and cash equivalents $ 624,129     $ 329,011  
Receivables 83,701     69,276  
Real estate inventories 3,194,148     3,065,436  
Investments in unconsolidated entities 11,091     11,745  
Goodwill and other intangible assets, net 159,759     159,893  
Deferred tax assets, net 46,266     49,904  
Other assets 173,959     173,425  
Total assets $ 4,293,053     $ 3,858,690  
       
Liabilities      
Accounts payable $ 77,275     $ 66,120  
Accrued expenses and other liabilities 315,560     322,043  
Loans payable 750,000     250,000  
Senior notes 1,034,925     1,033,985  
Total liabilities 2,177,760     1,672,148  
       
Commitments and contingencies      
       
Equity      
Stockholders’ equity:      
Preferred stock, $0.01 par value, 50,000,000 shares authorized; no shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively      
Common stock, $0.01 par value, 500,000,000 shares authorized; 130,236,981 and 136,149,633 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively 1,302     1,361  
Additional paid-in capital 478,122     581,195  
Retained earnings 1,635,857     1,603,974  
Total stockholders’ equity 2,115,281     2,186,530  
Noncontrolling interests 12     12  
Total equity 2,115,293     2,186,542  
Total liabilities and equity $ 4,293,053     $ 3,858,690  


CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except share and per share amounts)
(unaudited)

  Three Months Ended March 31,
  2020   2019
Homebuilding:      
Home sales revenue $ 594,838     $ 492,703  
Land and lot sales revenue     1,029  
Other operations revenue 618     598  
Total revenues 595,456     494,330  
Cost of home sales 472,882     421,536  
Cost of land and lot sales 202     1,495  
Other operations expense 624     590  
Sales and marketing 42,637     38,989  
General and administrative 39,837     38,597  
Homebuilding income (loss) from operations 39,274     (6,877 )
Equity in loss of unconsolidated entities (14 )   (25 )
Other income, net 373     6,241  
Homebuilding income (loss) before income taxes 39,633     (661 )
Financial Services:      
Revenues 1,594     302  
Expenses 1,079     321  
Equity in income of unconsolidated entities 1,556     775  
Financial services income before income taxes 2,071     756  
Income before income taxes 41,704     95  
Provision for income taxes (9,821 )   (24 )
Net income $ 31,883     $ 71  
Earnings per share      
Basic $ 0.24     $ 0.00  
Diluted $ 0.24     $ 0.00  
Weighted average shares outstanding      
Basic 134,361,148     141,865,270  
Diluted 135,038,481     142,390,163  


MARKET DATA BY REPORTING SEGMENT & STATE
(dollars in thousands)
(unaudited)

  Three Months Ended March 31,
  2020   2019
  New
Homes
Delivered
  Average
Sales
Price
  New
Homes
Delivered
  Average
Sales
Price
New Homes Delivered:              
Maracay 140     $ 513     74     $ 535  
Pardee Homes 257     694     242     557  
Quadrant Homes 52     836     44     983  
Trendmaker Homes 209     460     154     455  
TRI Pointe Homes 226     702     242     710  
Winchester Homes 74     628     58     571  
Total 958     $ 621     814     $ 605  
               
               
  Three Months Ended March 31,
  2020   2019
  New
Homes
Delivered
  Average
Sales
Price
  New
Homes
Delivered
  Average
Sales
Price
New Homes Delivered:              
California 339     $ 763     328     $ 679  
Colorado 64     568     72     549  
Maryland 55     561     38     466  
Virginia 19     819     20     769  
Arizona 140     513     74     535  
Nevada 80     528     84     529  
Texas 209     460     154     455  
Washington 52     836     44     983  
Total 958     $ 621     814     $ 605  


MARKET DATA BY REPORTING SEGMENT & STATE, continued
(unaudited)

  Three Months Ended March 31,
  2020   2019
  Net New
Home
Orders
  Average
Selling
Communities
  Net New
Home
Orders
  Average
Selling
Communities
Net New Home Orders:              
Maracay 240     15.3     161     11.8  
Pardee Homes 475     41.5     433     44.5  
Quadrant Homes 126     7.0     75     7.2  
Trendmaker Homes 234     30.2     243     39.3  
TRI Pointe Homes 414     32.8     295     30.8  
Winchester Homes 172     14.0     114     14.2  
Total 1,661     140.8     1,321     147.8  
               
               
  Three Months Ended March 31,
  2020   2019
  Net New
Home
Orders
  Average
Selling
Communities
  Net New
Home
Orders
  Average
Selling
Communities
Net New Home Orders:              
California 664     55.6     517     54.7  
Colorado 59     4.5     81     7.0  
Maryland 123     10.0     84     9.8  
Virginia 49     4.0     30     4.5  
Arizona 240     15.3     161     11.8  
Nevada 166     14.2     130     13.5  
Texas 234     30.2     243     39.3  
Washington 126     7.0     75     7.2  
Total 1,661     140.8     1,321     147.8  


MARKET DATA BY REPORTING SEGMENT & STATE, continued
(dollars in thousands)
(unaudited)

  As of March 31, 2020   As of March 31, 2019
  Backlog
Units
  Backlog
Dollar
Value
  Average
Sales
Price
  Backlog
Units
  Backlog
Dollar
Value
  Average
Sales
Price
Backlog:                      
Maracay 430     $ 239,555     $ 557     238     $ 139,862     $ 588  
Pardee Homes 678     491,236     725     593     472,729     797  
Quadrant Homes 163     145,873     895     77     75,599     982  
Trendmaker Homes 370     183,012     495     402     196,256     488  
TRI Pointe Homes 517     365,638     707     371     247,399     667  
Winchester Homes 297     193,167     650     161     105,993     658  
Total 2,455     $ 1,618,481     $ 659     1,842     $ 1,237,838     $ 672  
                       
                       
  As of March 31, 2020   As of March 31, 2019
  Backlog
Units
  Backlog
Dollar
Value
  Average
Sales
Price
  Backlog
Units
  Backlog
Dollar
Value
  Average
Sales
Price
Backlog:                      
California 877     $ 670,672     $ 765     645     $ 530,031     $ 822  
Colorado 95     56,278     592     153     86,570     566  
Maryland 185     104,737     566     107     56,087     524  
Virginia 112     88,430     790     54     49,906     924  
Arizona 430     239,555     557     238     139,862     588  
Nevada 223     129,924     583     166     103,527     624  
Texas 370     183,012     495     402     196,256     488  
Washington 163     145,873     895     77     75,599     982  
Total 2,455     $ 1,618,481     $ 659     1,842     $ 1,237,838     $ 672  


MARKET DATA BY REPORTING SEGMENT & STATE, continued
(unaudited)

  March 31,   December 31,
  2020   2019
Lots Owned or Controlled(1):      
Maracay 3,727     3,730  
Pardee Homes 13,327     13,267  
Quadrant Homes 1,051     1,103  
Trendmaker Homes 5,398     4,034  
TRI Pointe Homes 6,804     6,170  
Winchester Homes 1,700     1,725  
Total 32,007     30,029  
       
       
  March 31,   December 31,
  2020   2019
Lots Owned or Controlled(1):      
California 14,802     14,677  
Colorado 1,133     1,033  
Maryland 947     1,140  
Virginia 753     585  
Arizona 3,727     3,730  
Nevada 2,133     2,026  
North Carolina 2,010     1,590  
South Carolina 53     111  
Texas 5,398     4,034  
Washington 1,051     1,103  
Total 32,007     30,029  
       
       
  March 31,   December 31,
  2020   2019
Lots by Ownership Type:      
Lots owned 22,860     22,845  
Lots controlled(1) 9,147     7,184  
Total 32,007     30,029  

__________
(1)  As of March 31, 2020 and December 31, 2019, lots controlled included lots that were under land option contracts or purchase contracts.


RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(unaudited)

In this press release, we utilize certain financial measures that are non-GAAP financial measures as defined by the Securities and Exchange Commission. We present these measures because we believe they and similar measures are useful to management and investors in evaluating the Company’s operating performance and financing structure. We also believe these measures facilitate the comparison of our operating performance and financing structure with other companies in our industry. Because these measures are not calculated in accordance with Generally Accepted Accounting Principles (“GAAP”), they may not be comparable to other similarly titled measures of other companies and should not be considered in isolation or as a substitute for, or superior to, financial measures prepared in accordance with GAAP.

The following table reconciles homebuilding gross margin percentage, as reported and prepared in accordance with GAAP, to the non-GAAP measure adjusted homebuilding gross margin percentage. We believe this information is meaningful as it isolates the impact that leverage has on homebuilding gross margin and permits investors to make better comparisons with our competitors, who adjust gross margins in a similar fashion.

  Three Months Ended March 31,
  2020   %   2019   %
  (dollars in thousands)
Home sales revenue $ 594,838     100.0 %   $ 492,703     100.0 %
Cost of home sales 472,882     79.5 %   421,536     85.6 %
Homebuilding gross margin 121,956     20.5 %   71,167     14.4 %
Add: interest in cost of home sales 16,822     2.8 %   14,191     2.9 %
Add: impairments and lot option abandonments 349     0.1 %   5,202     1.1 %
Adjusted homebuilding gross margin $ 139,127     23.4 %   $ 90,560     18.4 %
Homebuilding gross margin percentage 20.5 %       14.4 %    
Adjusted homebuilding gross margin percentage 23.4 %       18.4 %    


RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued)
(unaudited)

The following table reconciles the Company’s ratio of debt-to-capital to the non-GAAP ratio of net debt-to-net capital. We believe that the ratio of net debt-to-net capital is a relevant financial measure for management and investors to understand the leverage employed in our operations and as an indicator of the Company’s ability to obtain financing.

  March 31, 2020   December 31, 2019
Loans payable $ 750,000     $ 250,000  
Senior notes 1,034,925     1,033,985  
Total debt 1,784,925     1,283,985  
Stockholders’ equity 2,115,281     2,186,530  
Total capital $ 3,900,206     $ 3,470,515  
Ratio of debt-to-capital(1) 45.8 %   37.0 %
       
Total debt $ 1,784,925     $ 1,283,985  
Less: Cash and cash equivalents (624,129 )   (329,011 )
Net debt 1,160,796     954,974  
Stockholders’ equity 2,115,281     2,186,530  
Net capital $ 3,276,077     $ 3,141,504  
Ratio of net debt-to-net capital(2) 35.4 %   30.4 %

__________
(1)  The ratio of debt-to-capital is computed as the quotient obtained by dividing total debt by the sum of total debt plus stockholders’ equity.
(2)  The ratio of net debt-to-net capital is computed as the quotient obtained by dividing net debt (which is total debt less cash and cash equivalents) by the sum of net debt plus stockholders’ equity.


RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued)
(unaudited)

The following table calculates the non-GAAP financial measures of EBITDA and Adjusted EBITDA and reconciles those amounts to net income, as reported and prepared in accordance with GAAP.  EBITDA means net income before (a) interest expense, (b) expensing of previously capitalized interest included in costs of home sales, (c) income taxes and (d) depreciation and amortization. Adjusted EBITDA means EBITDA before (e) amortization of stock-based compensation and (f) impairments and lot option abandonments.  Other companies may calculate EBITDA and Adjusted EBITDA (or similarly titled measures) differently. We believe EBITDA and Adjusted EBITDA are useful measures of the Company’s ability to service debt and obtain financing.

  Three Months Ended March 31,
  2020   2019
  (in thousands)
Net income $ 31,883     $ 71  
Interest expense:      
Interest incurred 20,779     23,373  
Interest capitalized (20,779 )   (23,373 )
Amortization of interest in cost of sales 16,822     14,333  
Provision for income taxes 9,821     24  
Depreciation and amortization 5,456     5,085  
EBITDA 63,982     19,513  
Amortization of stock-based compensation 3,625     3,435  
Impairments and lot option abandonments 349     5,202  
Adjusted EBITDA $ 67,956     $ 28,150  

 

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