Meritage Homes reports third quarter 2016 diluted EPS of $0.88 on a 22% increase in net earnings, with 11% growth in home clo...
27 October 2016 - 10:30PM
Meritage Homes Corporation (NYSE:MTH), a leading U.S. homebuilder,
announced today third quarter results for the period ended
September 30, 2016.
|
Summary Operating Results
(unaudited) |
(Dollars in thousands, except per share
amounts) |
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2016 |
|
2015 |
|
% Chg |
|
2016 |
|
2015 |
|
% Chg |
Homes closed (units) |
|
1,800 |
|
|
1,712 |
|
|
5 |
% |
|
5,238 |
|
|
4,603 |
|
|
14 |
% |
Home closing revenue |
|
$ |
735,870 |
|
|
$ |
661,884 |
|
|
11 |
% |
|
$ |
2,127,332 |
|
|
$ |
1,770,184 |
|
|
20 |
% |
Average sales price -
closings |
|
$ |
409 |
|
|
$ |
387 |
|
|
6 |
% |
|
$ |
406 |
|
|
$ |
385 |
|
|
6 |
% |
Home orders (units) |
|
1,737 |
|
|
1,567 |
|
|
11 |
% |
|
5,797 |
|
|
5,532 |
|
|
5 |
% |
Home order value |
|
$ |
715,562 |
|
|
$ |
629,977 |
|
|
14 |
% |
|
$ |
2,365,508 |
|
|
$ |
2,188,604 |
|
|
8 |
% |
Average sales price -
orders |
|
$ |
412 |
|
|
$ |
402 |
|
|
2 |
% |
|
$ |
408 |
|
|
$ |
396 |
|
|
3 |
% |
Ending backlog
(units) |
|
|
|
|
|
|
|
3,251 |
|
|
3,043 |
|
|
7 |
% |
Ending backlog value |
|
|
|
|
|
|
|
$ |
1,375,857 |
|
|
$ |
1,264,872 |
|
|
9 |
% |
Average sales price -
backlog |
|
|
|
|
|
|
|
$ |
423 |
|
|
$ |
416 |
|
|
2 |
% |
Net earnings |
|
$ |
36,887 |
|
|
$ |
30,308 |
|
|
22 |
% |
|
$ |
97,734 |
|
|
$ |
75,841 |
|
|
29 |
% |
Diluted EPS |
|
$ |
0.88 |
|
|
$ |
0.73 |
|
|
21 |
% |
|
$ |
2.33 |
|
|
$ |
1.83 |
|
|
27 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MANAGEMENT COMMENTS
“We delivered another quarter of strong earnings growth as we
continued to execute on our strategic plan,” said Steven J. Hilton,
chairman and chief executive officer of Meritage Homes. “Earnings
growth was driven primarily by increased home closing revenue on
higher closing volumes. We delivered 1,800 homes during the quarter
and celebrated the closing of our 100,000th home in October. We
have expanded and diversified strategically over the past 31 years,
and continue to have significant opportunities for growth.
“I am very pleased with the initial success we’re having in our
‘entry-level plus’ communities, including the first of our new
LiVE.NOW.™ homes, which we unveiled earlier this month,” said Mr.
Hilton. “We are offering homes that are a cut above traditional
entry-level homes and include Meritage’s signature energy
efficiency, designed to appeal to more discerning first-time
buyers. Many of those are Millennials, who represent millions of
additional household formations over the next decade or more, and
additional growth potential for Meritage. Our enhanced product
offering provides a broader range of affordably-priced homes to
address pent-up demand, which we expect will produce top-line
growth and operational efficiencies over time to drive additional
earnings.”
He added, “We are benefitting from the numerous operational
changes we made last year in our latest expansion markets and are
experiencing higher absorptions in Georgia, North Carolina and
Tennessee, which should lead to better returns and improved
operating leverage for our company. As a result of those changes
and stronger demand, we achieved a 14% increase in our orders per
average community over last year’s third quarter, which drove our
11% order growth during the quarter," continued Mr. Hilton. “We
believe the economic drivers of the housing market, including job
growth, increased household formations and low interest rates,
point to continued growth for well-positioned homebuilders.
“Based on our results for the first three quarters of the year
and our positive outlook for the market, we have refined our
projections for 2016 full year orders, closings, revenue and
diluted earnings per share: We expect 7,300-7,500 orders and
7,300-7,500 home closings for full year home closing revenue of
$2.9-3.1 billion in 2016. With a projected home closing gross
margin of approximately 17.5% for the year, we expect to deliver
full year diluted EPS of $3.40-3.60 for 2016.”
THIRD QUARTER RESULTS
- Net earnings for the third quarter of 2016 were $36.9 million
or $0.88 per diluted share, 22% higher than the $30.3 million or
$0.73 per diluted share reported for the third quarter of 2015,
primarily reflecting higher home closing revenue offsetting lower
home closing gross margins in the 2016 quarter.
- Home closing revenue increased 11% over the third quarter of
2015, combining a 5% increase in home closings with a 6% increase
in the average price of homes closed during the quarter. The rise
in average closing price was driven primarily by increased closings
and higher average prices in the West region. Central region home
closing revenue grew 9% on a 5% increase in closings over the prior
year. Closings grew 10% in the East region, partially offset by a
3% decline in average closing price, for a 6% increase in home
closing revenue.
- Home closing gross margin of 17.8% in the third quarter of 2016
declined from 19.0% in the third quarter of 2015, though it
improved sequentially from 17.3% in the second quarter of 2016.
Margins have been compressed in 2016 primarily due to limited
pricing power to offset increased land and construction costs.
- Selling, general and administrative expenses were 11.4% of
third quarter 2016 total closing revenue, compared to 11.5% in the
prior year.
- Interest expense decreased by $4.0 million to $0.2 million in
the third quarter of 2016, as more interest incurred was
capitalized to assets under development.
- Other income/(expense) increased by a net $5.4 million in the
third quarter of 2016 compared to 2015, reflecting a $4.1 million
adverse legal ruling in 2015, while the 2016 quarter included
additional income from municipalities related to reimbursable
property development expenditures.
- The effective tax rate was 31.4% in the third quarter of 2016,
compared to 35.1% in the third quarter of 2015, reflecting the
benefit from federal energy tax credits on Meritage’s highly energy
efficient homes. The benefit was recognized in the third quarter of
2016 compared to the fourth quarter of 2015, following the
legislative extension of energy tax credits.
- Total order value grew 14% to $715.6 million in the third
quarter of 2016, compared to $630.0 million in the third quarter of
the prior year. Total orders increased 11% due to a 14% increase in
orders per average community, despite a lower community count in
the third quarter of 2016 than in 2015. Orders per average
community were 7.3 in the third quarter of 2016 compared to 6.4 in
the prior year. Average sales prices also rose 2% over 2015’s third
quarter.
- Ending community count at September 30, 2016 was 237, compared
to 250 at September 30, 2015, with a 2% decline in average active
communities for the third quarter of 2016 compared to 2015.
- September 30th ending backlog value was 9% higher in 2016 than
in 2015, combining 7% more units in backlog with a 2% increase in
the average price of orders in backlog.
YEAR TO DATE RESULTS
- Net earnings were $97.7 million or $2.33 per fully diluted
share for the first nine months of 2016, compared to $75.8 million
or $1.83 per diluted share for the first nine months of 2015, a 29%
increase in net earnings and 27% increase in fully diluted EPS. The
increased earnings were primarily the result of a 20% increase in
2016 year-to-date home closing revenue and greater overhead
leverage, partially offset by lower home closing gross
margins.
- Home closings for the first three quarters of the year
increased 14% over 2015, and average closing prices increased 6%
for the same period.
- Year-to-date home closing gross margin in 2016 was 17.5%,
compared to 18.9% for 2015, reflecting limited pricing power
relative to increased land and construction costs, as well as
immature markets within the East region.
- Total commissions and selling expenses declined to 7.3% of
year-to-date 2016 home closing revenue from 7.6% in 2015. General
and administrative expenses declined to 4.3% of total closing
revenue in 2016 compared to 4.8% in 2015.
- Interest expense for the first nine months of the year
decreased to $5.1 million in 2016 compared to $12.0 million in
2015, as more interest was capitalized to assets under
development.
BALANCE SHEET
- The company ended the third quarter of 2016 with $107.9 million
in cash and cash equivalents, compared to $262.2 million at
December 31, 2015. The decrease in cash was primarily due to
investments in real estate inventory as a result of organic growth.
The company had $25 million drawn on its revolving credit facility
at quarter-end, which was repaid in early October.
- Real estate assets increased to $2.43 billion at September 30,
2016, compared to $2.10 billion at December 31, 2015, as the
balance of homes under contract under construction increased $176
million, accounting for most of the increase.
- Net debt-to-capital ratio at September 30 was 43.0%, consistent
with June 30, 2016 at 42.6%, and up from 40.4% at December 31, 2015
due to the use of cash to replenish the company’s land pipeline, as
well as a growing inventory of homes under construction during
2016.
- Total lot supply at the end of the quarter was approximately
28,800, compared to approximately 29,000 at September 30, 2015 and
27,800 at year-end 2015. Based on trailing twelve months closings,
total lots at September 30, 2016 represented approximately a 4.0
year supply of lots.
CONFERENCE CALL
Management will host a conference call today to discuss the
Company's results at 12:30 p.m. Eastern Time (9:30 a.m. Arizona
Time). The call will be webcast with an accompanying slideshow
available on the "Investor Relations" page of the Company's web
site at http://investors.meritagehomes.com. Telephone participants
may avoid any delays by pre-registering for the call using the
following link to receive a special dial-in number and PIN.
Conference call registration link:
http://dpregister.com/10092994.
Telephone participants who are unable to pre-register may dial
in to 866-226-4948 on the day of the call. International dial-in
number is 1-412-902-4125 or 1-855-669-9657 in Canada.
A replay of the call will be available through November 10,
2016, beginning at 2:30 p.m. ET on October 27, 2016 on the website
noted above, or by dialing 877-344-7529, and referencing conference
number 10092994. For more information, visit
www.meritagehomes.com.
|
|
|
Meritage Homes Corporation and
Subsidiaries |
|
Consolidated Income Statements |
|
(In thousands, except per share
data) |
|
(Unaudited) |
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Homebuilding: |
|
|
|
|
|
|
|
|
Home closing revenue |
$ |
735,870 |
|
|
$ |
661,884 |
|
|
$ |
2,127,332 |
|
|
$ |
1,770,184 |
|
|
Land closing revenue |
16,987 |
|
|
8,072 |
|
|
21,187 |
|
|
16,285 |
|
|
Total closing revenue |
752,857 |
|
|
669,956 |
|
|
2,148,519 |
|
|
1,786,469 |
|
|
Cost of home closings |
(604,891 |
) |
|
(536,267 |
) |
|
(1,755,260 |
) |
|
(1,434,843 |
) |
|
Cost of land closings |
(16,092 |
) |
|
(7,445 |
) |
|
(19,485 |
) |
|
(14,992 |
) |
|
Total cost of closings |
(620,983 |
) |
|
(543,712 |
) |
|
(1,774,745 |
) |
|
(1,449,835 |
) |
|
Home closing gross
profit |
130,979 |
|
|
125,617 |
|
|
372,072 |
|
|
335,341 |
|
|
Land closing gross
profit |
895 |
|
|
627 |
|
|
1,702 |
|
|
1,293 |
|
|
Total closing gross profit |
131,874 |
|
|
126,244 |
|
|
373,774 |
|
|
336,634 |
|
Financial Services: |
|
|
|
|
|
|
|
|
Revenue |
3,139 |
|
|
3,000 |
|
|
9,115 |
|
|
8,276 |
|
|
Expense |
(1,398 |
) |
|
(1,253 |
) |
|
(4,152 |
) |
|
(3,914 |
) |
|
Earnings from financial
services unconsolidated entities and other, net |
4,215 |
|
|
3,854 |
|
|
10,802 |
|
|
9,155 |
|
|
Financial services profit |
5,956 |
|
|
5,601 |
|
|
15,765 |
|
|
13,517 |
|
Commissions
and other sales costs |
(52,478 |
) |
|
(48,097 |
) |
|
(155,034 |
) |
|
(134,876 |
) |
General and
administrative expenses |
(33,258 |
) |
|
(28,774 |
) |
|
(91,774 |
) |
|
(86,074 |
) |
Earnings/(loss) from other unconsolidated entities, net |
440 |
|
|
(123 |
) |
|
856 |
|
|
(415 |
) |
Interest
expense |
(167 |
) |
|
(4,187 |
) |
|
(5,127 |
) |
|
(11,962 |
) |
Other
income/(expense), net |
1,435 |
|
|
(3,996 |
) |
|
3,263 |
|
|
(3,445 |
) |
Earnings
before income taxes |
53,802 |
|
|
46,668 |
|
|
141,723 |
|
|
113,379 |
|
Provision for
income taxes |
(16,915 |
) |
|
(16,360 |
) |
|
(43,989 |
) |
|
(37,538 |
) |
Net
earnings |
$ |
36,887 |
|
|
$ |
30,308 |
|
|
$ |
97,734 |
|
|
$ |
75,841 |
|
|
|
|
|
|
|
|
|
Earnings per share: |
|
|
|
|
|
|
|
|
Basic |
|
|
|
|
|
|
|
|
Earnings per share |
$ |
0.92 |
|
|
$ |
0.76 |
|
|
$ |
2.45 |
|
|
$ |
1.92 |
|
|
Weighted average shares
outstanding |
40,022 |
|
|
39,663 |
|
|
39,958 |
|
|
39,568 |
|
|
Diluted |
|
|
|
|
|
|
|
|
Earnings per share |
$ |
0.88 |
|
|
$ |
0.73 |
|
|
$ |
2.33 |
|
|
$ |
1.83 |
|
|
Weighted average shares
outstanding |
42,608 |
|
|
42,192 |
|
|
42,541 |
|
|
42,134 |
|
|
Meritage Homes Corporation and
Subsidiaries |
Consolidated Balance Sheets |
(In thousands) |
(Unaudited) |
|
|
|
September 30, 2016 |
|
December 31, 2015 |
Assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
107,915 |
|
|
$ |
262,208 |
|
Other receivables |
|
76,371 |
|
|
57,296 |
|
Real estate (1) |
|
2,429,014 |
|
|
2,098,302 |
|
Deposits on real estate under
option or contract |
|
91,053 |
|
|
87,839 |
|
Investments in unconsolidated
entities |
|
11,831 |
|
|
11,370 |
|
Property and equipment, net |
|
33,983 |
|
|
33,970 |
|
Deferred tax asset |
|
57,552 |
|
|
59,147 |
|
Prepaids, other assets and
goodwill |
|
65,436 |
|
|
69,645 |
|
Total assets |
|
$ |
2,873,155 |
|
|
$ |
2,679,777 |
|
Liabilities: |
|
|
|
|
Accounts payable |
|
$ |
148,260 |
|
|
$ |
106,440 |
|
Accrued liabilities |
|
180,687 |
|
|
161,163 |
|
Home sale deposits |
|
36,988 |
|
|
36,197 |
|
Loans payable and other
borrowings |
|
45,183 |
|
|
23,867 |
|
Senior and convertible senior
notes, net |
|
1,094,632 |
|
|
1,093,173 |
|
Total liabilities |
|
1,505,750 |
|
|
1,420,840 |
|
Stockholders'
Equity: |
|
|
|
|
Preferred stock |
|
— |
|
|
— |
|
Common stock |
|
400 |
|
|
397 |
|
Additional paid-in capital |
|
570,223 |
|
|
559,492 |
|
Retained earnings |
|
796,782 |
|
|
699,048 |
|
Total stockholders’ equity |
|
1,367,405 |
|
|
1,258,937 |
|
Total liabilities and stockholders’
equity |
|
$ |
2,873,155 |
|
|
$ |
2,679,777 |
|
(1) Real
estate – Allocated costs: |
|
|
|
|
Homes under contract under
construction |
|
$ |
632,454 |
|
|
$ |
456,138 |
|
Unsold homes, completed and under
construction |
|
377,490 |
|
|
307,425 |
|
Model homes |
|
150,662 |
|
|
138,546 |
|
Finished home sites and home sites
under development |
|
1,268,408 |
|
|
1,196,193 |
|
Total real estate |
|
$ |
2,429,014 |
|
|
$ |
2,098,302 |
|
Supplemental Information and Non-GAAP
Financial Disclosures (Dollars in thousands –
unaudited): |
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Depreciation and amortization |
$ |
3,870 |
|
|
$ |
3,565 |
|
|
$ |
11,470 |
|
|
$ |
10,294 |
|
|
|
|
|
|
|
|
|
Summary of Capitalized
Interest: |
|
|
|
|
|
|
|
Capitalized interest, beginning of period |
$ |
64,682 |
|
|
$ |
58,870 |
|
|
$ |
61,202 |
|
|
$ |
54,060 |
|
Interest incurred |
17,372 |
|
|
17,857 |
|
|
52,644 |
|
|
49,665 |
|
Interest expensed |
(167 |
) |
|
(4,187 |
) |
|
(5,127 |
) |
|
(11,962 |
) |
Interest amortized to cost of home and land
closings |
(14,256 |
) |
|
(11,144 |
) |
|
(41,088 |
) |
|
(30,367 |
) |
Capitalized interest, end of period |
$ |
67,631 |
|
|
$ |
61,396 |
|
|
$ |
67,631 |
|
|
$ |
61,396 |
|
|
|
|
|
|
|
|
|
|
September 30, 2016 |
|
December 31, 2015 |
|
|
|
|
Notes payable and other borrowings |
$ |
1,139,815 |
|
|
$ |
1,117,040 |
|
|
|
|
|
Stockholders' equity |
1,367,405 |
|
|
1,258,937 |
|
|
|
|
|
Total capital |
2,507,220 |
|
|
2,375,977 |
|
|
|
|
|
Debt-to-capital |
45.5 |
% |
|
47.0 |
% |
|
|
|
|
Notes payable and other borrowings |
$ |
1,139,815 |
|
|
1,117,040 |
|
|
|
|
|
Less: cash and cash
equivalents |
$ |
(107,915 |
) |
|
$ |
(262,208 |
) |
|
|
|
|
Net debt |
1,031,900 |
|
|
854,832 |
|
|
|
|
|
Stockholders’ equity |
1,367,405 |
|
|
1,258,937 |
|
|
|
|
|
Total net capital |
$ |
2,399,305 |
|
|
$ |
2,113,769 |
|
|
|
|
|
Net debt-to-capital |
43.0 |
% |
|
40.4 |
% |
|
|
|
|
|
Meritage Homes Corporation and
Subsidiaries |
Consolidated Statements of Cash
Flows |
(In thousands) |
(Unaudited) |
|
|
|
Nine Months Ended September 30, |
|
|
2016 |
|
2015 |
Cash flows from
operating activities: |
|
|
|
|
Net earnings |
|
$ |
97,734 |
|
|
$ |
75,841 |
|
Adjustments to reconcile net
earnings to net cash used in operating activities: |
|
|
|
|
Depreciation and amortization |
|
11,470 |
|
|
10,294 |
|
Stock-based compensation |
|
11,042 |
|
|
12,418 |
|
Excess income tax
provision/(benefit) from stock-based awards |
|
540 |
|
|
(2,040 |
) |
Equity in earnings from
unconsolidated entities |
|
(11,658 |
) |
|
(8,740 |
) |
Distribution of earnings from
unconsolidated entities |
|
11,439 |
|
|
9,446 |
|
Other |
|
4,942 |
|
|
1,246 |
|
Changes in assets and
liabilities: |
|
|
|
|
Increase in real estate |
|
(318,490 |
) |
|
(198,520 |
) |
(Increase)/decrease in deposits on
real estate under option or contract |
|
(3,160 |
) |
|
2,719 |
|
Increase in other receivables,
prepaids and other assets |
|
(14,201 |
) |
|
(6,067 |
) |
Increase in accounts payable and
accrued liabilities |
|
61,206 |
|
|
39,949 |
|
Increase in home sale deposits |
|
791 |
|
|
10,208 |
|
Net cash used in operating
activities |
|
(148,345 |
) |
|
(53,246 |
) |
Cash flows from investing
activities: |
|
|
|
|
Investments in unconsolidated
entities |
|
(242 |
) |
|
(300 |
) |
Purchases of property and
equipment |
|
(12,256 |
) |
|
(12,334 |
) |
Proceeds from sales of property and
equipment |
|
144 |
|
|
92 |
|
Maturities/sales of investments and
securities |
|
645 |
|
|
— |
|
Payments to purchase investments
and securities |
|
(645 |
) |
|
— |
|
Net cash used in investing
activities |
|
(12,354 |
) |
|
(12,542 |
) |
Cash flows from financing
activities: |
|
|
|
|
Proceeds from Credit Facility,
net |
|
25,000 |
|
|
— |
|
Repayment of loans payable and
other borrowings |
|
(18,286 |
) |
|
(4,044 |
) |
Proceeds from issuance of senior
notes |
|
— |
|
|
200,000 |
|
Debt issuance costs |
|
— |
|
|
(3,013 |
) |
Excess income tax
(provision)/benefit from stock-based awards |
|
(540 |
) |
|
2,040 |
|
Proceeds from stock option
exercises |
|
232 |
|
|
2,881 |
|
Net cash provided by financing
activities |
|
6,406 |
|
|
197,864 |
|
Net (decrease)/increase in cash and cash
equivalents |
|
(154,293 |
) |
|
132,076 |
|
Beginning cash and cash
equivalents |
|
262,208 |
|
|
103,333 |
|
Ending cash and cash
equivalents |
|
$ |
107,915 |
|
|
$ |
235,409 |
|
|
Meritage Homes Corporation and
Subsidiaries |
Operating Data |
(Dollars in thousands) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
|
2016 |
|
2015 |
|
|
Homes |
|
Value |
|
Homes |
|
Value |
Homes
Closed: |
|
|
|
|
|
|
|
|
Arizona |
|
253 |
|
|
$ |
89,092 |
|
|
302 |
|
|
$ |
92,888 |
|
California |
|
251 |
|
|
142,056 |
|
|
236 |
|
|
120,387 |
|
Colorado |
|
167 |
|
|
84,114 |
|
|
123 |
|
|
56,927 |
|
West Region |
|
671 |
|
|
315,262 |
|
|
661 |
|
|
270,202 |
|
Texas |
|
542 |
|
|
199,499 |
|
|
517 |
|
|
183,455 |
|
Central
Region |
|
542 |
|
|
199,499 |
|
|
517 |
|
|
183,455 |
|
Florida |
|
206 |
|
|
85,647 |
|
|
202 |
|
|
90,285 |
|
Georgia |
|
83 |
|
|
27,477 |
|
|
62 |
|
|
20,663 |
|
North Carolina |
|
177 |
|
|
71,641 |
|
|
165 |
|
|
63,532 |
|
South Carolina |
|
76 |
|
|
22,658 |
|
|
80 |
|
|
25,812 |
|
Tennessee |
|
45 |
|
|
13,686 |
|
|
25 |
|
|
7,935 |
|
East Region |
|
587 |
|
|
221,109 |
|
|
534 |
|
|
208,227 |
|
Total |
|
1,800 |
|
|
$ |
735,870 |
|
|
1,712 |
|
|
$ |
661,884 |
|
Homes
Ordered: |
|
|
|
|
|
|
|
|
Arizona |
|
345 |
|
|
$ |
116,815 |
|
|
272 |
|
|
$ |
96,867 |
|
California |
|
216 |
|
|
125,920 |
|
|
203 |
|
|
110,076 |
|
Colorado |
|
121 |
|
|
66,213 |
|
|
84 |
|
|
43,782 |
|
West Region |
|
682 |
|
|
308,948 |
|
|
559 |
|
|
250,725 |
|
Texas |
|
488 |
|
|
178,934 |
|
|
452 |
|
|
165,206 |
|
Central
Region |
|
488 |
|
|
178,934 |
|
|
452 |
|
|
165,206 |
|
Florida |
|
208 |
|
|
95,946 |
|
|
227 |
|
|
94,114 |
|
Georgia |
|
85 |
|
|
28,841 |
|
|
67 |
|
|
23,143 |
|
North Carolina |
|
149 |
|
|
61,537 |
|
|
138 |
|
|
57,168 |
|
South Carolina |
|
71 |
|
|
22,434 |
|
|
88 |
|
|
26,766 |
|
Tennessee |
|
54 |
|
|
18,922 |
|
|
36 |
|
|
12,855 |
|
East Region |
|
567 |
|
|
227,680 |
|
|
556 |
|
|
214,046 |
|
Total |
|
1,737 |
|
|
$ |
715,562 |
|
|
1,567 |
|
|
$ |
629,977 |
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
|
2016 |
|
2015 |
|
|
Homes |
|
Value |
|
Homes |
|
Value |
Homes
Closed: |
|
|
|
|
|
|
|
|
Arizona |
|
749 |
|
|
$ |
258,139 |
|
|
717 |
|
|
$ |
227,367 |
|
California |
|
738 |
|
|
418,834 |
|
|
565 |
|
|
302,573 |
|
Colorado |
|
474 |
|
|
231,913 |
|
|
364 |
|
|
166,914 |
|
West Region |
|
1,961 |
|
|
908,886 |
|
|
1,646 |
|
|
696,854 |
|
Texas |
|
1,563 |
|
|
566,377 |
|
|
1,466 |
|
|
510,439 |
|
Central
Region |
|
1,563 |
|
|
566,377 |
|
|
1,466 |
|
|
510,439 |
|
Florida |
|
619 |
|
|
252,311 |
|
|
589 |
|
|
254,607 |
|
Georgia |
|
229 |
|
|
76,874 |
|
|
156 |
|
|
49,178 |
|
North Carolina |
|
474 |
|
|
198,525 |
|
|
389 |
|
|
148,721 |
|
South Carolina |
|
231 |
|
|
71,577 |
|
|
247 |
|
|
77,630 |
|
Tennessee |
|
161 |
|
|
52,782 |
|
|
110 |
|
|
32,755 |
|
East Region |
|
1,714 |
|
|
652,069 |
|
|
1,491 |
|
|
562,891 |
|
Total |
|
5,238 |
|
|
$ |
2,127,332 |
|
|
4,603 |
|
|
$ |
1,770,184 |
|
Homes
Ordered: |
|
|
|
|
|
|
|
|
Arizona |
|
935 |
|
|
$ |
322,807 |
|
|
880 |
|
|
$ |
290,172 |
|
California |
|
775 |
|
|
442,863 |
|
|
750 |
|
|
419,987 |
|
Colorado |
|
459 |
|
|
237,237 |
|
|
454 |
|
|
213,610 |
|
West Region |
|
2,169 |
|
|
1,002,907 |
|
|
2,084 |
|
|
923,769 |
|
Texas |
|
1,629 |
|
|
597,947 |
|
|
1,644 |
|
|
574,533 |
|
Central
Region |
|
1,629 |
|
|
597,947 |
|
|
1,644 |
|
|
574,533 |
|
Florida |
|
702 |
|
|
295,453 |
|
|
693 |
|
|
295,634 |
|
Georgia |
|
305 |
|
|
102,392 |
|
|
197 |
|
|
64,051 |
|
North Carolina |
|
497 |
|
|
205,562 |
|
|
467 |
|
|
191,460 |
|
South Carolina |
|
296 |
|
|
95,123 |
|
|
283 |
|
|
85,767 |
|
Tennessee |
|
199 |
|
|
66,124 |
|
|
164 |
|
|
53,390 |
|
East Region |
|
1,999 |
|
|
764,654 |
|
|
1,804 |
|
|
690,302 |
|
Total |
|
5,797 |
|
|
$ |
2,365,508 |
|
|
5,532 |
|
|
$ |
2,188,604 |
|
|
|
|
|
|
|
|
|
|
Order
Backlog: |
|
|
|
|
|
|
|
|
Arizona |
|
503 |
|
|
$ |
182,574 |
|
|
355 |
|
|
$ |
129,023 |
|
California |
|
326 |
|
|
208,175 |
|
|
397 |
|
|
241,377 |
|
Colorado |
|
317 |
|
|
167,475 |
|
|
358 |
|
|
168,329 |
|
West Region |
|
1,146 |
|
|
558,224 |
|
|
1,110 |
|
|
538,729 |
|
Texas |
|
1,008 |
|
|
381,764 |
|
|
1,036 |
|
|
373,135 |
|
Central
Region |
|
1,008 |
|
|
381,764 |
|
|
1,036 |
|
|
373,135 |
|
Florida |
|
370 |
|
|
161,148 |
|
|
341 |
|
|
143,597 |
|
Georgia |
|
171 |
|
|
58,944 |
|
|
94 |
|
|
31,457 |
|
North Carolina |
|
283 |
|
|
118,515 |
|
|
263 |
|
|
110,907 |
|
South Carolina |
|
153 |
|
|
53,657 |
|
|
106 |
|
|
34,257 |
|
Tennessee |
|
120 |
|
|
43,605 |
|
|
93 |
|
|
32,790 |
|
East Region |
|
1,097 |
|
|
435,869 |
|
|
897 |
|
|
353,008 |
|
Total |
|
3,251 |
|
|
$ |
1,375,857 |
|
|
3,043 |
|
|
$ |
1,264,872 |
|
Meritage Homes Corporation and
Subsidiaries |
Operating Data |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
|
2016 |
|
2015 |
|
|
Ending |
|
Average |
|
Ending |
|
Average |
Active
Communities: |
|
|
|
|
|
|
|
|
Arizona |
|
40 |
|
|
41.5 |
|
|
41 |
|
|
42.0 |
|
California |
|
29 |
|
|
27.0 |
|
|
26 |
|
|
23.0 |
|
Colorado |
|
10 |
|
|
11.0 |
|
|
15 |
|
|
15.5 |
|
West Region |
|
79 |
|
|
79.5 |
|
|
82 |
|
|
80.5 |
|
Texas |
|
74 |
|
|
73.5 |
|
|
70 |
|
|
68.0 |
|
Central
Region |
|
74 |
|
|
73.5 |
|
|
70 |
|
|
68.0 |
|
Florida |
|
26 |
|
|
26.0 |
|
|
31 |
|
|
30.5 |
|
Georgia |
|
17 |
|
|
17.0 |
|
|
17 |
|
|
16.5 |
|
North Carolina |
|
19 |
|
|
20.5 |
|
|
25 |
|
|
25.0 |
|
South Carolina |
|
15 |
|
|
15.5 |
|
|
17 |
|
|
18.5 |
|
Tennessee |
|
7 |
|
|
7.0 |
|
|
8 |
|
|
6.0 |
|
East Region |
|
84 |
|
|
86.0 |
|
|
98 |
|
|
96.5 |
|
Total |
|
237 |
|
|
239.0 |
|
|
250 |
|
|
245.0 |
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
|
2016 |
|
2015 |
|
|
Ending |
|
Average |
|
Ending |
|
Average |
Active
Communities: |
|
|
|
|
|
|
|
|
Arizona |
|
40 |
|
|
40.5 |
|
|
41 |
|
|
41.0 |
|
California |
|
29 |
|
|
26.5 |
|
|
26 |
|
|
25.0 |
|
Colorado |
|
10 |
|
|
13.0 |
|
|
15 |
|
|
16.0 |
|
West Region |
|
79 |
|
|
80.0 |
|
|
82 |
|
|
82.0 |
|
Texas |
|
74 |
|
|
73.0 |
|
|
70 |
|
|
64.5 |
|
Central
Region |
|
74 |
|
|
73.0 |
|
|
70 |
|
|
64.5 |
|
Florida |
|
26 |
|
|
28.5 |
|
|
31 |
|
|
30.0 |
|
Georgia |
|
17 |
|
|
17.0 |
|
|
17 |
|
|
15.0 |
|
North Carolina |
|
19 |
|
|
22.5 |
|
|
25 |
|
|
23.0 |
|
South Carolina |
|
15 |
|
|
16.5 |
|
|
17 |
|
|
18.5 |
|
Tennessee |
|
7 |
|
|
8.0 |
|
|
8 |
|
|
6.5 |
|
East Region |
|
84 |
|
|
92.5 |
|
|
98 |
|
|
93.0 |
|
Total |
|
237 |
|
|
245.5 |
|
|
250 |
|
|
239.5 |
|
About Meritage Homes Corporation
Meritage Homes is the seventh-largest public homebuilder in the
United States, based on homes closed in 2015. Meritage Homes builds
and sells single-family homes for first-time, move-up, luxury and
active adult buyers across the Western, Southern and Southeastern
United States. Meritage Homes builds in markets including
Sacramento, San Francisco Bay area, southern coastal and Inland
Empire markets in California; Houston, Dallas-Ft. Worth, Austin and
San Antonio, Texas; Phoenix/Scottsdale, Green Valley and Tucson,
Arizona; Denver and Fort Collins, Colorado; Orlando, Tampa and
south Florida; Raleigh and Charlotte, North Carolina;
Greenville-Spartanburg and York County, South Carolina; Nashville,
Tennessee; and Atlanta, Georgia.
Meritage Homes has designed and built over 100,000 homes in its
31-year history, and has a reputation for its distinctive style,
quality construction, and positive customer experience. Meritage
Homes is the industry leader in energy-efficient homebuilding and
has received the U.S. Environmental Protection Agency's ENERGY STAR
Partner of the Year for Sustained Excellence Award every year since
2013 for innovation and industry leadership in energy efficient
homebuilding. For more information, visit meritagehomes.com.
This press release and the accompanying comments during our
analyst call contain forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Such
statements include management's expectations with respect to future
growth, projected orders, home closings and home closing revenue,
home closing gross margins and diluted earnings per share for the
full year 2016.
Such statements are based upon the current beliefs and
expectations of Company management, and current market conditions,
which are subject to significant risks and uncertainties. Actual
results may differ from those set forth in the forward-looking
statements. The Company makes no commitment, and disclaims any
duty, to update or revise any forward-looking statements to reflect
future events or changes in these expectations. Meritage's business
is subject to a number of risks and uncertainties. As a result of
those risks and uncertainties, the Company's stock and note prices
may fluctuate dramatically. These risks and uncertainties include,
but are not limited to, the following: the availability and cost of
finished lots and undeveloped land; interest rates and changes in
the availability and pricing of residential mortgages; fluctuations
in the availability and cost of labor; changes in tax laws that
adversely impact us or our homebuyers; reversal of the current
economic recovery; the ability of our potential buyers to sell
their existing homes; cancellation rates; inflation in the cost of
materials used to develop communities and construct homes; the
adverse effect of slower order absorption rates; impairments of our
real estate inventory; a change to the feasibility of projects
under option or contract that could result in the write-down or
write-off of option deposits; our potential exposure to natural
disasters or severe weather conditions; competition; construction
defect and home warranty claims; failures in health and safety
performance; our success in prevailing on contested tax positions;
our ability to obtain performance bonds in connection with our
development work; the loss of key personnel; enactment of new laws
or regulations or our failure to comply with laws and regulations;
our limited geographic diversification; fluctuations in quarterly
operating results; our level of indebtedness; our ability to obtain
financing due to a downgrade of our credit ratings; our ability to
successfully integrate acquired companies and achieve anticipated
benefits from these acquisitions; our compliance with government
regulations and the effect of legislative or other initiatives that
seek to restrain growth of new housing construction or similar
measures; legislation relating to energy and climate change; the
replication of our energy-efficient technologies by our
competitors; our exposure to information technology failures and
security breaches; and other factors identified in documents filed
by the Company with the Securities and Exchange Commission,
including those set forth in our Form 10-K for the year ended
December 31, 2015 and subsequent quarterly reports on Forms 10-Q
under the caption "Risk Factors," which can be found on our
website.
Contacts: Brent Anderson, VP Investor Relations
(972) 580-6360 (office)
investors@meritagehomes.com
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