MIAMI, June 21, 2016 /PRNewswire/ --
- Net earnings of $218.5
million, or $0.95 per diluted
share, compared to net earnings of $183.0
million, or $0.79 per diluted
share
- Deliveries of 6,724 homes – up 12%
- New orders of 7,962 homes – up 10%; new orders dollar value
of $2.9 billion – up 11%
- Backlog of 9,014 homes – up 12%; backlog dollar value of
$3.3 billion – up 15%
- Revenues of $2.7 billion – up
15%
- Lennar Homebuilding operating earnings of $342.7 million, compared to $292.8 million – up 17%
- Gross margin on home sales of 23.1%, compared to 23.8% in Q2
2015, improved sequentially 40 basis points from Q1 2016
- S,G&A expenses as a % of revenues from home sales
improved to 9.3% from 10.0% in Q2 2015, improved sequentially 150
basis points from Q1 2016
- Operating margin on home sales improved to 13.9% from 13.8%
in Q2 2015, improved sequentially 200 basis points from Q1
2016
- Lennar Financial Services operating earnings of $44.1 million, compared to $39.1 million
- Rialto operating loss (net of noncontrolling interests) of
$13.8 million, compared to operating
earnings (net of noncontrolling interests) of $7.6 million
- Lennar Multifamily operating earnings of $14.9 million, compared to an operating loss of
$8.7 million
- Lennar Homebuilding cash and cash equivalents of
$601 million
- Lennar Homebuilding debt to total capital, net of cash and
cash equivalents, of 43.5%
Lennar Corporation (NYSE: LEN and LEN.B), one
of the nation's largest homebuilders, today reported results
for its second quarter ended May 31,
2016. Second quarter net earnings attributable to Lennar in
2016 were $218.5 million, or
$0.95 per diluted share, compared to
second quarter net earnings attributable to Lennar in 2015 of
$183.0 million, or $0.79 per diluted share.
Stuart Miller, Chief Executive
Officer of Lennar Corporation, said, "We are very pleased with our
second quarter results as we achieved pre-tax earnings of
$327.8 million, our highest second
quarter pre-tax earnings since 2006. The homebuilding market
continued its slow and steady recovery sustained by low interest
rates, modest wage growth, positive consumer confidence and low
unemployment levels combined with tight inventory levels.
"As this year's spring selling season improved over last year,
our second quarter new orders increased 10% to 7,962 homes
year-over-year, while our home deliveries and home sales revenue
also increased to 6,724 homes and $2.4
billion, respectively. As the recovery has continued
to mature, we have remained focused on our strategy of moderating
our growth rate in community count and home sales, as well as on
our soft-pivot land strategy, targeting land acquisitions with a
shorter average life.
"Our core homebuilding business continued to produce strong
operating results in the second quarter of 2016 as our operating
margin was 13.9%, a 10 basis point improvement from last year,
notwithstanding a lower gross margin in the quarter, as
expected. Our homebuilding divisions continued to benefit
from their focus on migrating from traditional to digital
marketing, which helped to reduce S,G&A as a percentage of home
sales revenues to 9.3%, the lowest second quarter percentage in our
history. As we continue our strategy of infusing and reinvigorating
technologies throughout various aspects of our business, we look
forward to additional opportunities that lie ahead."
Mr. Miller continued, "Alongside our homebuilding business, our
Financial Services operations reported strong earnings of
$44.1 million in our second quarter,
up 13% from the same period last year, primarily due to higher
profit per transaction in its mortgage and
title operations.
"For the third consecutive quarter, our Multifamily business
generated positive operating earnings. During the second quarter,
earnings were $14.9 million primarily
due to the sale of an apartment property by one of its joint
ventures and a third-party land sale. In addition, subsequent to
quarter end, the Lennar Multifamily Venture received an additional
$550 million of equity commitments,
increasing its total equity commitments to approximately
$2.0 billion.
"Rialto has continued to grow despite the combination of turmoil
in the CMBS markets earlier in the year and a write-off relating to
a single asset in one of our early bank portfolios.
During the second quarter, our investment management platform
increased assets under management and profitability, while our
mortgage finance business continues to be a market leader in
securitization margins and has seen an increase in its origination
volumes, which improved sequentially from the first quarter.
"Finally, during the second quarter of 2016, we contributed our
investment in three strategic joint ventures previously managed by
FivePoint Communities in exchange for an investment in a newly
formed FivePoint entity.
This transaction marked the next step in FivePoint's strategic
evolution as a leader in the management and development of large
master-planned communities."
Mr. Miller concluded, "With a strong balance sheet, a backlog of
homes with a value of $3.3 billion
and a solid strategy in our core and ancillary businesses, we are
well positioned to continue our strong performance for
2016."
RESULTS OF OPERATIONS
THREE MONTHS ENDED MAY
31, 2016 COMPARED TO
THREE MONTHS ENDED
MAY 31, 2015
Lennar Homebuilding
Revenues from home sales increased 17% in the second quarter of
2016 to $2.4 billion from
$2.1 billion in the second quarter of
2015. Revenues were higher primarily due to a 12% increase in the
number of home deliveries, excluding unconsolidated entities, and a
4% increase in the average sales price of homes delivered. New home
deliveries, excluding unconsolidated entities, increased to 6,711
homes in the second quarter of 2016 from 5,989 homes in the second
quarter of 2015. There was an increase in home deliveries in all of
the Company's Homebuilding segments, except in Homebuilding Houston
and Homebuilding Other. The decrease in home deliveries in
Houston was primarily due to less
demand driven by volatility in the energy sector. The decrease in
home deliveries in Homebuilding Other was primarily due to a higher
mix of start-up communities, which are earlier in the life cycle of
delivering homes than non start-up communities. The average sales
price of homes delivered increased to $362,000 in the second quarter of 2016 from
$348,000 in the second quarter of
2015. Sales incentives offered to homebuyers were $21,800 per home delivered in the second quarter
of 2016, or 5.7% as a percentage of home sales revenue, compared to
$21,500 per home delivered in the
second quarter of 2015, or 5.8% as a percentage of home sales
revenue, and $21,600 per home
delivered in the first quarter of 2016, or 5.6% as a percentage of
home sales revenue.
Gross margins on home sales were $561.5
million, or 23.1%, in the second quarter of 2016, compared
to $495.9 million, or 23.8%, in the
second quarter of 2015. Gross margin percentage on home sales
decreased compared to the second quarter of 2015 primarily due to
an increase in land costs, partially offset by an increase in the
average sales price of homes delivered.
Selling, general and administrative expenses were $224.8 million in the second quarter of 2016,
compared to $209.0 million in the
second quarter of 2015. As a percentage of revenues from home
sales, selling, general and administrative expenses improved to
9.3% in the second quarter of 2016, from 10.0% in the second
quarter of 2015, due to improved operating leverage as a result of
an increase in home deliveries and benefits from the Company's
focus on digital marketing.
Lennar Homebuilding equity in earnings (loss) from
unconsolidated entities was ($9.6)
million in the second quarter of 2016, compared to
$6.5 million in the second quarter of
2015. In the second quarter of 2016, Lennar Homebuilding equity in
loss from unconsolidated entities was primarily attributable to the
Company's share of costs associated with the FivePoint combination.
This was partially offset by $6.7
million of equity in earnings from one of the Company's
unconsolidated entities primarily due to sales of homesites to
third parties. In the second quarter of 2015, Lennar Homebuilding
equity in earnings from unconsolidated entities included
$11.6 million of equity in earnings
from one of the Company's unconsolidated entities primarily due to
the sale of a commercial property and homesites to third parties,
partially offset by the Company's share of net operating losses
from various unconsolidated entities.
Lennar Homebuilding other income (expense), net, was
$14.9 million in the second quarter
of 2016, compared to ($0.2) million
in the second quarter of 2015. Other income, net in the second
quarter of 2016 was primarily related to a profit participation
received by one of Lennar Homebuilding's consolidated joint
ventures.
Lennar Homebuilding interest expense was $63.9 million in the second quarter of 2016
($62.1 million was included in cost
of homes sold, $0.6 million in cost
of land sold and $1.2 million in
other interest expense), compared to $57.7
million in the second quarter of 2015 ($53.2 million was included in cost of homes sold,
$0.6 million in cost of land sold and
$3.8 million in other interest
expense). Interest expense included in cost of homes sold increased
primarily due to an increase in the Company's outstanding
homebuilding debt and an increase in home deliveries.
Lennar Financial Services
Operating earnings for the Lennar Financial Services segment
were $44.1 million in the second
quarter of 2016, compared to $39.1
million in the second quarter of 2015. The increase in
profitability was primarily due to higher profit per transaction in
the segment's mortgage and title operations.
Rialto
Operating loss for the Rialto segment was $13.8 million in the second quarter of 2016
(which included an $18.1 million
operating loss and an add back of $4.3
million of net loss attributable to noncontrolling
interests). The operating loss in the second quarter of 2016
included a $16.0 million write-off
of uncollectible receivables related to a
hospital, which was acquired through the resolution of one of
Rialto's loans from a 2010 portfolio. The hospital is managed by a third-party
management company. Operating earnings for second quarter of 2015
were $7.6 million (which included
$6.9 million of operating earnings
and an add back of $0.7 million of
net loss attributable to noncontrolling interests).
Revenues in this segment were $44.8
million in the second quarter of 2016, compared to
$67.9 million in the second quarter
of 2015. Revenues decreased primarily due to a decrease in Rialto
Mortgage Finance ("RMF") securitization revenues due to lower
securitization volume and margins. During the second quarter of
2016 and 2015, Rialto received $2.5
million and $4.8 million,
respectively, of advanced distributions with regard to Rialto's
carried interests in its real estate funds
(the "Funds") in order to cover income tax obligations
resulting from allocations of taxable income to Rialto's carried
interests in these funds.
Expenses in this segment were $50.2
million in the second quarter of 2016, compared to
$67.5 million in the second quarter
of 2015. Expenses decreased primarily due to a decrease in general
and administrative expenses and a decrease in securitization
expenses related to RMF.
Rialto equity in earnings from unconsolidated entities was
$6.9 million and $7.3 million in the second quarter of 2016 and
2015, respectively, related to Rialto's share of earnings from the
Funds.
Rialto other expense, net, was $19.6
million in the second quarter of 2016, compared to
$0.9 million in the second quarter of
2015. In the second quarter of 2016, Rialto other expense, net,
included a $16.0 million write-off
of uncollectible receivables related to the hospital.
Lennar Multifamily
Operating earnings for the Lennar Multifamily segment were
$14.9 million in the second quarter
of 2016, compared to an operating loss of $8.7 million in the second quarter of 2015. The
increase in profitability was primarily due to the segment's
$15.4 million share of a gain as a
result of the sale of an operating property by one of Lennar
Multifamily's unconsolidated entities and a gain of $5.2 million on a third-party land sale.
Corporate General and Administrative Expenses
Corporate general and administrative expenses were $55.8 million, or 2.0% as a percentage of total
revenues, in the second quarter of 2016, compared to $50.2 million, or 2.1% as a percentage of total
revenues, in the second quarter of 2015. As a percentage of total
revenues, corporate general and administrative expenses improved
due to increased operating leverage.
Noncontrolling Interests
Net earnings attributable to noncontrolling interests were
$5.6 million and $1.6 million in the second quarter of 2016 and
2015, respectively. Net earnings attributable to noncontrolling
interests during the second quarter of 2016 were primarily
attributable to earnings related to Lennar Homebuilding
consolidated joint ventures, partially offset by a net loss related
to the FDIC's interest in the portfolio of real estate loans that
the Company acquired in partnership with the FDIC. Net earnings
attributable to noncontrolling interests during the second quarter
of 2015 were primarily attributable to a strategic transaction by
one of Lennar Homebuilding's consolidated joint ventures that
impacted noncontrolling interests by $2.3
million, partially offset by a net loss related to the
FDIC's interest in the portfolio of real estate loans that the
Company acquired in partnership with the FDIC.
SIX MONTHS ENDED MAY
31, 2016 COMPARED TO
SIX MONTHS ENDED MAY 31, 2015
Lennar Homebuilding
Revenues from home sales increased 20% in the six months ended
May 31, 2016 to $4.2 billion from $3.5
billion in the six months ended May
31, 2015. Revenues were higher primarily due to a 12%
increase in the number of home deliveries, excluding unconsolidated
entities, and a 7% increase in the average sales price of homes
delivered. New home deliveries, excluding unconsolidated entities,
increased to 11,517 homes in the six months ended May 31, 2016 from 10,290 homes in the six months
ended May 31, 2015. There was an
increase in home deliveries in all of the Company's Homebuilding
segments, except in Homebuilding Houston. The decrease in home
deliveries in Houston was
primarily due to less demand driven by volatility in the energy
sector. The average sales price of homes delivered increased to
$363,000 in the six months ended
May 31, 2016 from $339,000 in the six months ended May 31, 2015. Sales incentives offered to
homebuyers were $21,700 per home
delivered in the six months ended May 31,
2016, or 5.6% as a percentage of home sales revenue,
compared to $21,600 per home
delivered in the six months ended May 31,
2015, or 6.0% as a percentage of home sales revenue.
Gross margins on home sales were $960.5
million, or 23.0%, in the six months ended May 31, 2016, compared to $820.6 million, or 23.5%, in the six months ended
May 31, 2015. Gross margin percentage
on home sales decreased compared to the six months ended
May 31, 2015 primarily due to an
increase in land costs, partially offset by an increase in the
average sales price of homes delivered.
Selling, general and administrative expenses were $414.6 million in the six months ended
May 31, 2016, compared to
$369.4 million in the six months
ended May 31, 2015. As a percentage
of revenues from home sales, selling, general and administrative
expenses improved to 9.9% in the six months ended May 31, 2016, from 10.6% in the six months ended
May 31, 2015, due to improved
operating leverage as a result of an increase in home deliveries
and benefits from the Company's focus on digital marketing.
Lennar Homebuilding equity in earnings (loss) from
unconsolidated entities was ($6.6)
million in the six months ended May
31, 2016, compared to $35.4
million in the six months ended May
31, 2015. In the six months ended May
31, 2016, Lennar Homebuilding equity in earnings from
unconsolidated entities was primarily attributable to the Company's
share of costs associated with the FivePoint combination. This was
partially offset by $12.7 million of
equity in earnings from one of the Company's unconsolidated
entities primarily due to sales of homesites to third parties. In
the six months ended May 31, 2015,
Lennar Homebuilding equity in earnings from unconsolidated entities
included $43.0 million of equity in
earnings from one of the Company's unconsolidated entities
primarily due to sales of homesites and a commercial property to
third parties, partially offset by the Company's share of net
operating losses from various unconsolidated entities.
Lennar Homebuilding other income, net, totaled $15.4 million in the six months ended
May 31, 2016, compared to
$6.1 million in the six months ended
May 31, 2015. In the six months ended
May 31, 2016, other income, net
included a profit participation received by one of Lennar
Homebuilding's consolidated joint ventures. In the six months ended
May 31, 2015, other income, net
included a $6.5 million gain on the
sale of an operating property.
Lennar Homebuilding interest expense was $109.1 million in the six months ended
May 31, 2016 ($105.4 million was included in cost of homes
sold, $1.3 million in cost of land
sold and $2.4 million in other
interest expense), compared to $95.7
million in the six months ended May
31, 2015 ($86.8 million was
included in cost of homes sold, $1.0
million in cost of land sold and $7.9
million in other interest expense). Interest expense
included in cost of homes sold increased primarily due to an
increase in the Company's outstanding homebuilding debt and an
increase in home deliveries.
Lennar Financial Services
Operating earnings for the Lennar Financial Services segment
were $59.0 million in the six months
ended May 31, 2016, compared to
$54.6 million in the six months ended
May 31, 2015. The increase in
profitability was primarily due to higher profit per transaction in
the segment's mortgage and title operations.
Rialto
Operating loss for the Rialto segment was $11.8 million in the six months ended
May 31, 2016 (which included a
$16.5 million operating loss and an
add back of $4.6 million of net loss
attributable to noncontrolling interests). The operating loss in
the six months ended May 31, 2016
included a $16.0 million write-off
of uncollectible receivables related to
the hospital. Operating earnings in the six months ended
May 31, 2015 were $12.2 million (which included $9.7 million of operating earnings and an add
back of $2.5 million of net loss
attributable to noncontrolling interests).
Revenues in this segment were $88.5
million in the six months ended May
31, 2016, compared to $109.1
million in the six months ended May
31, 2015. Revenues decreased primarily due to a decrease in
RMF securitization revenues due to lower securitization volume and
margins. During the six months ended May 31,
2016 and 2015, Rialto received $7.4
million and $11.3 million,
respectively, of advanced distributions with regard to Rialto's
carried interests in the Funds in order to cover income tax
obligations resulting from allocations of taxable income to
Rialto's carried interests in these funds.
Expenses in this segment were $93.1
million in the six months ended May
31, 2016, compared to $108.3
million in the six months ended May
31, 2015. Expenses decreased primarily due to a decrease in
general and administrative expenses and a decrease in
securitization expenses related to RMF.
Rialto equity in earnings from unconsolidated entities was
$8.4 million and $10.0 million in the six months ended
May 31, 2016 and 2015, respectively,
related to Rialto's share of earnings from the Funds. The decrease
in equity in earnings was primarily related to mark downs of
certain assets in the Funds and smaller net increases in the fair
value of certain assets in the Funds in the six months ended
May 31, 2016 than in the same period
last year.
Rialto other expense, net, was $20.3
million in the six months ended May
31, 2016, compared to $1.1
million in the six months ended May
31, 2015. In the six months ended May
31, 2016, Rialto other expense, net, included a $16.0 million write-off of uncollectible
receivables related to the hospital.
Lennar Multifamily
Operating earnings for the Lennar Multifamily segment were
$27.1 million in the six months ended
May 31, 2016, compared to an
operating loss of $14.4 million in
the six months ended May 31, 2015.
The increase in profitability was primarily due to the segment's
$35.8 million share of gains as a
result of the sale of two operating properties by Lennar
Multifamily's unconsolidated entities and a gain of $5.2 million on a third-party land sale.
Corporate General and Administrative Expenses
Corporate general and administrative expenses were $103.5 million, or 2.2% as a percentage of total
revenues, in the six months ended May 31,
2016, compared to $93.9
million, or 2.3% as a percentage of total revenues, in the
six months ended May 31, 2015. As a
percentage of total revenues, corporate general and administrative
expenses improved due to increased operating leverage.
Noncontrolling Interests
Net earnings attributable to noncontrolling interests were
$6.9 million and $3.5 million in the six months ended May 31, 2016 and 2015, respectively. Net earnings
attributable to noncontrolling interests during the six months
ended May 31, 2016 were primarily
attributable to earnings related to Lennar Homebuilding
consolidated joint ventures, partially offset by a net loss related
to the FDIC's interest in the portfolio of real estate loans that
the Company acquired in partnership with the FDIC. Net earnings
attributable to noncontrolling interests during the six months
ended May 31, 2015 were primarily
attributable to a strategic transaction by one of Lennar
Homebuilding's consolidated joint ventures that impacted
noncontrolling interests by $2.3
million and earnings related to consolidated joint
ventures.
OTHER TRANSACTIONS
Debt Transactions
In the second quarter of 2016, the Company issued $500 million of 4.750% senior notes due 2021. The
Company used the net proceeds from the sales of the 4.750% senior
notes due 2021 to retire its 6.50% senior notes due April 2016 for 100% of the outstanding principal
amount, plus accrued and unpaid interest.
During the six months ended May 31,
2016, holders converted the remaining aggregate principal
amount of $234 million of the
Company's 2.75% convertible senior notes due 2020 for approximately
$234 million in cash and 5.2 million
shares of Class A common stock.
During the six months ended May 31,
2016, holders converted approximately $68 million aggregate principal amount of the
Company's 3.25% convertible senior notes due 2021 for approximately
2.9 million shares of Class A common stock. Subsequent to
May 31, 2016, holders have converted approximately
$136.5 million aggregate principal
amount of the Company's 3.25% convertible senior notes due 2021 for
approximately 5.8 million shares of Class A common stock and small
cash premiums.
About Lennar
Lennar Corporation, founded in 1954, is one of the nation's
largest builders of quality homes for all generations. The Company
builds affordable, move-up and retirement homes primarily under the
Lennar brand name. Lennar's Financial Services segment provides
mortgage financing, title insurance and closing services for both
buyers of the Company's homes and others. Lennar's Rialto segment
is a vertically integrated asset management platform focused on
investing throughout the commercial real estate capital structure.
Lennar's Multifamily segment is a nationwide developer of
high-quality multifamily rental properties. Previous press releases
and further information about the Company may be obtained at the
"Investor Relations" section of the Company's website,
www.lennar.com.
Note Regarding Forward-Looking Statements: Some of the
statements in this press release are "forward-looking statements,"
as that term is defined in the Private Securities Litigation Reform
Act of 1995, including statements regarding our belief regarding
the homebuilding market and other markets in which we participate,
and our belief regarding how we are positioned to take advantage of
opportunities, or to avoid problems, in those markets and to
advance the future growth of our businesses. You can identify
forward-looking statements by the fact that these statements do not
relate strictly to historical or current matters. Rather,
forward-looking statements relate to anticipated or expected
events, activities, trends or results. Accordingly, these
forward-looking statements should be evaluated with consideration
given to the many risks and uncertainties inherent in our business
that could cause actual results and events to differ materially
from those anticipated by the forward-looking statements. Important
factors that could cause such differences include increases in
operating costs, including costs related to real estate taxes,
construction materials, labor and insurance, and our ability to
manage our cost structure, both in our Lennar Homebuilding and
Lennar Multifamily businesses; a slowdown in the real estate
markets across the nation, including a slowdown in the market for
single family homes or the multifamily rental market; unfavorable
losses in legal proceedings; decreased demand for our homes or
Lennar Multifamily rental properties, and our inability to
successfully sell our apartments; natural disasters or catastrophic
events for which our insurance may not provide adequate coverage;
our ability to successfully execute our
strategies; a decline in the value of the land and home
inventories we maintain or possible future write-downs of the
carrying value of our real estate assets; the inability of the
Rialto segment to profit from the investments it makes; the
inability of Rialto to sell mortgages it originates into
securitizations on favorable terms; reduced availability of
mortgage financing or increased interest rates; conditions in the
capital, credit and financial markets; changes in laws, regulations
or the regulatory environment affecting our business, and the risks
described in our filings with the Securities and Exchange
Commission, including our Form 10-K for the fiscal year ended
November 30, 2015. We undertake no
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events, or
otherwise.
A conference call to discuss the Company's second quarter
earnings will be held at 11:00 a.m. Eastern
Time on Tuesday, June 21,
2016. The call will be broadcast live on the Internet and
can be accessed through the Company's website at www.lennar.com. If
you are unable to participate in the conference call, the call will
be archived at www.lennar.com for 90 days. A replay of the
conference call will also be available later that day by calling
203-369-0320 and entering 5723593 as the confirmation number.
|
LENNAR CORPORATION
AND SUBSIDIARIES
Selected Revenues and
Operating Information
(In thousands, except
per share amounts)
(unaudited)
|
|
|
Three Months
Ended
|
|
|
Six Months
Ended
|
|
|
May
31,
|
|
|
May
31,
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
Revenues:
|
|
|
|
|
|
|
|
|
Lennar
Homebuilding
|
$
|
2,450,885
|
|
|
2,115,812
|
|
|
4,237,366
|
|
|
3,557,470
|
|
|
Lennar Financial
Services
|
175,940
|
|
|
169,885
|
|
|
299,896
|
|
|
294,712
|
|
|
Rialto
|
44,838
|
|
|
67,931
|
|
|
88,549
|
|
|
109,128
|
|
|
Lennar
Multifamily
|
74,152
|
|
|
38,976
|
|
|
113,668
|
|
|
75,433
|
|
|
Total
revenues
|
$
|
2,745,815
|
|
|
2,392,604
|
|
|
4,739,479
|
|
|
4,036,743
|
|
|
|
|
|
|
|
|
|
|
Lennar Homebuilding
operating earnings
|
$
|
342,696
|
|
|
292,789
|
|
|
563,334
|
|
|
500,433
|
|
|
Lennar Financial
Services operating earnings
|
44,088
|
|
|
39,053
|
|
|
59,019
|
|
|
54,580
|
|
|
Rialto operating
earnings (loss)
|
(18,086)
|
|
|
6,881
|
|
|
(16,476)
|
|
|
9,689
|
|
|
Lennar Multifamily
operating earnings (loss)
|
14,943
|
|
|
(8,706)
|
|
|
27,125
|
|
|
(14,388)
|
|
|
Corporate general and
administrative expenses
|
(55,802)
|
|
|
(50,207)
|
|
|
(103,470)
|
|
|
(93,861)
|
|
|
Earnings before
income taxes
|
327,839
|
|
|
279,810
|
|
|
529,532
|
|
|
456,453
|
|
|
Provision for income
taxes
|
(103,801)
|
|
|
(95,226)
|
|
|
(160,042)
|
|
|
(154,952)
|
|
|
Net earnings
(including net earnings attributable to noncontrolling
interests)
|
224,038
|
|
|
184,584
|
|
|
369,490
|
|
|
301,501
|
|
|
Less: Net earnings
attributable to noncontrolling interests
|
5,569
|
|
|
1,568
|
|
|
6,941
|
|
|
3,522
|
|
|
Net earnings
attributable to Lennar
|
$
|
218,469
|
|
|
183,016
|
|
|
362,549
|
|
|
297,979
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
213,601
|
|
|
202,991
|
|
|
211,947
|
|
|
202,961
|
|
|
Diluted
|
229,917
|
|
|
231,041
|
|
|
229,417
|
|
|
230,679
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
1.01
|
|
|
0.89
|
|
|
1.69
|
|
|
1.45
|
|
|
Diluted
(1)
|
$
|
0.95
|
|
|
0.79
|
|
|
1.58
|
|
|
1.30
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
information:
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest incurred
(2)
|
$
|
71,857
|
|
|
76,232
|
|
|
143,447
|
|
|
146,491
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBIT
(3):
|
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings
attributable to Lennar
|
$
|
218,469
|
|
|
183,016
|
|
|
362,549
|
|
|
297,979
|
|
|
Provision for income
taxes
|
103,801
|
|
|
95,226
|
|
|
160,042
|
|
|
154,952
|
|
|
Interest
expense
|
63,866
|
|
|
57,678
|
|
|
109,090
|
|
|
95,709
|
|
|
EBIT
|
$
|
386,136
|
|
|
335,920
|
|
|
631,681
|
|
|
548,640
|
|
|
(1)
|
For the three and six
months ended May 31, 2016, diluted earnings per share includes an
add back of interest of $1.9 million and $3.9 million,
respectively, related to the Company's 3.25% convertible senior
notes. For the three and six months ended May 31, 2015, diluted
earnings per share includes an add back of interest of $2.0 million
and $4.0 million, respectively, related to the Company's 3.25%
convertible senior notes.
|
|
(2)
|
Amount represents
interest incurred related to Lennar Homebuilding debt.
|
|
(3)
|
EBIT is a non-GAAP
financial measure defined as earnings before interest and taxes.
This financial measure has been presented because the Company finds
it important and useful in evaluating its performance and believes
that it helps readers of the Company's financial statements compare
its operations with those of its competitors. Although management
finds EBIT to be an important measure in conducting and evaluating
the Company's operations, this measure has limitations as an
analytical tool as it is not reflective of the actual profitability
generated by the Company during the period. Management compensates
for the limitations of using EBIT by using this non-GAAP measure
only to supplement the Company's GAAP results. Due to the
limitations discussed, EBIT should not be viewed in isolation, as
it is not a substitute for GAAP measures.
|
|
LENNAR CORPORATION
AND SUBSIDIARIES
Segment
Information
(In
thousands)
(unaudited)
|
|
|
Three Months
Ended
|
|
|
Six Months
Ended
|
|
|
May
31,
|
|
|
May
31,
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
Lennar
Homebuilding revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of
homes
|
$
|
2,429,568
|
|
|
2,081,113
|
|
|
4,184,259
|
|
|
3,484,681
|
|
|
Sales of
land
|
21,317
|
|
|
34,699
|
|
|
53,107
|
|
|
72,789
|
|
|
Total
revenues
|
2,450,885
|
|
|
2,115,812
|
|
|
4,237,366
|
|
|
3,557,470
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lennar
Homebuilding costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of homes
sold
|
1,868,045
|
|
|
1,585,259
|
|
|
3,223,790
|
|
|
2,664,055
|
|
|
Cost of land
sold
|
19,468
|
|
|
31,204
|
|
|
42,080
|
|
|
57,229
|
|
|
Selling, general and
administrative
|
224,775
|
|
|
209,019
|
|
|
414,623
|
|
|
369,373
|
|
|
Total costs and
expenses
|
2,112,288
|
|
|
1,825,482
|
|
|
3,680,493
|
|
|
3,090,657
|
|
|
Lennar
Homebuilding operating margins
|
338,597
|
|
|
290,330
|
|
|
556,873
|
|
|
466,813
|
|
|
Lennar Homebuilding
equity in earnings (loss) from unconsolidated entities
|
(9,633)
|
|
|
6,494
|
|
|
(6,633)
|
|
|
35,393
|
|
|
Lennar Homebuilding
other income (expense), net
|
14,925
|
|
|
(217)
|
|
|
15,444
|
|
|
6,116
|
|
|
Other interest
expense
|
(1,193)
|
|
|
(3,818)
|
|
|
(2,350)
|
|
|
(7,889)
|
|
|
Lennar
Homebuilding operating earnings
|
$
|
342,696
|
|
|
292,789
|
|
|
563,334
|
|
|
500,433
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lennar Financial
Services revenues
|
$
|
175,940
|
|
|
169,885
|
|
|
299,896
|
|
|
294,712
|
|
|
Lennar Financial
Services costs and expenses
|
131,852
|
|
|
130,832
|
|
|
240,877
|
|
|
240,132
|
|
|
Lennar Financial
Services operating earnings
|
$
|
44,088
|
|
|
39,053
|
|
|
59,019
|
|
|
54,580
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rialto
revenues
|
$
|
44,838
|
|
|
67,931
|
|
|
88,549
|
|
|
109,128
|
|
|
Rialto costs and
expenses
|
50,203
|
|
|
67,506
|
|
|
93,110
|
|
|
108,287
|
|
|
Rialto equity in
earnings from unconsolidated entities
|
6,864
|
|
|
7,328
|
|
|
8,361
|
|
|
9,992
|
|
|
Rialto other expense,
net
|
(19,585)
|
|
|
(872)
|
|
|
(20,276)
|
|
|
(1,144)
|
|
|
Rialto operating
earnings (loss)
|
$
|
(18,086)
|
|
|
6,881
|
|
|
(16,476)
|
|
|
9,689
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lennar Multifamily
revenues
|
$
|
74,152
|
|
|
38,976
|
|
|
113,668
|
|
|
75,433
|
|
|
Lennar Multifamily
costs and expenses
|
73,217
|
|
|
47,260
|
|
|
120,237
|
|
|
89,221
|
|
|
Lennar Multifamily
equity in earnings (loss) from unconsolidated entities
|
14,008
|
|
|
(422)
|
|
|
33,694
|
|
|
(600)
|
|
|
Lennar Multifamily
operating earnings (loss)
|
$
|
14,943
|
|
|
(8,706)
|
|
|
27,125
|
|
|
(14,388)
|
|
|
LENNAR CORPORATION
AND SUBSIDIARIES
Summary of Deliveries
and New Orders
(Dollars in
thousands, except average sales price)
(unaudited)
|
|
|
|
|
|
For the Three
Months Ended May 31,
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
Deliveries:
|
Homes
|
|
|
Dollar
Value
|
|
|
Average Sales
Price
|
|
|
East
|
3,032
|
|
|
2,708
|
|
|
$
|
953,671
|
|
|
833,146
|
|
|
$
|
315,000
|
|
|
308,000
|
|
|
Central
|
1,217
|
|
|
951
|
|
|
409,027
|
|
|
301,339
|
|
|
336,000
|
|
|
317,000
|
|
|
West
|
1,503
|
|
|
1,353
|
|
|
727,384
|
|
|
624,042
|
|
|
484,000
|
|
|
461,000
|
|
|
Houston
|
613
|
|
|
636
|
|
|
182,328
|
|
|
182,633
|
|
|
297,000
|
|
|
287,000
|
|
|
Other
|
359
|
|
|
367
|
|
|
166,833
|
|
|
157,391
|
|
|
465,000
|
|
|
429,000
|
|
|
Total
|
6,724
|
|
|
6,015
|
|
|
$
|
2,439,243
|
|
|
2,098,551
|
|
|
$
|
363,000
|
|
|
349,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Of the total homes
delivered listed above, 13 homes with a dollar value of $9.7
million and an average sales price of $744,000 represent home
deliveries from unconsolidated entities for the three months ended
May 31, 2016, compared to 26 home deliveries with a dollar value of
$17.4 million and an average sales price of $671,000 for the three
months ended May 31, 2015.
|
|
|
New
Orders:
|
Homes
|
|
|
Dollar
Value
|
|
|
Average Sales
Price
|
|
|
East
|
3,568
|
|
|
3,179
|
|
|
$
|
1,109,894
|
|
|
982,831
|
|
|
$
|
311,000
|
|
|
309,000
|
|
|
Central
|
1,489
|
|
|
1,217
|
|
|
516,765
|
|
|
398,694
|
|
|
347,000
|
|
|
328,000
|
|
|
West
|
1,781
|
|
|
1,756
|
|
|
834,570
|
|
|
818,981
|
|
|
469,000
|
|
|
466,000
|
|
|
Houston
|
651
|
|
|
684
|
|
|
199,262
|
|
|
203,386
|
|
|
306,000
|
|
|
297,000
|
|
|
Other
|
473
|
|
|
435
|
|
|
221,393
|
|
|
185,542
|
|
|
468,000
|
|
|
427,000
|
|
|
Total
|
7,962
|
|
|
7,271
|
|
|
$
|
2,881,884
|
|
|
2,589,434
|
|
|
$
|
362,000
|
|
|
356,000
|
|
|
|
|
Of the total new
orders listed above, 9 homes with a dollar value of $5.4 million
and an average sales price of $597,000 represent new orders from
unconsolidated entities for the three months ended May 31, 2016,
compared to 24 new orders with a dollar value of $17.7 million and
an average sales price of $737,000 for the three months ended May
31, 2015.
|
|
|
For the Six Months
Ended May 31,
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
Deliveries:
|
Homes
|
|
|
Dollar
Value
|
|
|
Average Sales
Price
|
|
|
East
|
5,096
|
|
|
4,694
|
|
|
$
|
1,601,426
|
|
|
1,420,464
|
|
|
$
|
314,000
|
|
|
303,000
|
|
|
Central
|
2,041
|
|
|
1,632
|
|
|
679,072
|
|
|
506,079
|
|
|
333,000
|
|
|
310,000
|
|
|
West
|
2,671
|
|
|
2,279
|
|
|
1,286,918
|
|
|
1,006,702
|
|
|
482,000
|
|
|
442,000
|
|
|
Houston
|
1,070
|
|
|
1,097
|
|
|
312,721
|
|
|
307,563
|
|
|
292,000
|
|
|
280,000
|
|
|
Other
|
678
|
|
|
615
|
|
|
327,870
|
|
|
261,581
|
|
|
484,000
|
|
|
425,000
|
|
|
Total
|
11,556
|
|
|
10,317
|
|
|
$
|
4,208,007
|
|
|
3,502,389
|
|
|
$
|
364,000
|
|
|
339,000
|
|
|
|
|
Of the total homes
delivered listed above, 39 homes with a dollar value of $23.7
million and an average sales price of $609,000 represent home
deliveries from unconsolidated entities for the six months ended
May 31, 2016, compared to 27 home deliveries with a dollar value of
$17.7 million and an average sales price of $656,000 for the six
months ended May 31, 2015.
|
|
|
New
Orders:
|
Homes
|
|
|
Dollar
Value
|
|
|
Average Sales
Price
|
|
|
East
|
6,096
|
|
|
5,509
|
|
|
$
|
1,907,942
|
|
|
1,708,851
|
|
|
$
|
313,000
|
|
|
310,000
|
|
|
Central
|
2,617
|
|
|
2,129
|
|
|
901,450
|
|
|
685,369
|
|
|
344,000
|
|
|
322,000
|
|
|
West
|
3,071
|
|
|
2,946
|
|
|
1,458,418
|
|
|
1,346,565
|
|
|
475,000
|
|
|
457,000
|
|
|
Houston
|
1,153
|
|
|
1,204
|
|
|
344,748
|
|
|
349,109
|
|
|
299,000
|
|
|
290,000
|
|
|
Other
|
819
|
|
|
770
|
|
|
377,195
|
|
|
328,321
|
|
|
461,000
|
|
|
426,000
|
|
|
Total
|
13,756
|
|
|
12,558
|
|
|
$
|
4,989,753
|
|
|
4,418,215
|
|
|
$
|
363,000
|
|
|
352,000
|
|
|
|
|
Of the total new
orders listed above, 24 homes with a dollar value of $14.1 million
and an average sales price of $588,000 represent new orders from
unconsolidated entities for the six months ended May 31, 2016,
compared to 50 new orders with a dollar value of $30.0 million and
an average sales price of $600,000 for the six months ended May 31,
2015.
|
|
|
LENNAR CORPORATION
AND SUBSIDIARIES
Summary of
Backlog
(Dollars in
thousands, except average sales price)
(unaudited)
|
|
|
May
31,
|
|
|
Backlog:
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
2016
|
|
|
2015
|
|
|
Homes
|
|
|
Dollar
Value
|
|
|
Average Sales
Price
|
|
|
East (1)
|
3,963
|
|
|
3,603
|
|
|
$
|
1,287,728
|
|
|
1,173,900
|
|
|
$
|
325,000
|
|
|
326,000
|
|
|
Central
|
1,946
|
|
|
1,458
|
|
|
699,991
|
|
|
490,007
|
|
|
360,000
|
|
|
336,000
|
|
|
West
|
1,754
|
|
|
1,658
|
|
|
843,871
|
|
|
777,451
|
|
|
481,000
|
|
|
469,000
|
|
|
Houston
|
781
|
|
|
937
|
|
|
240,079
|
|
|
267,415
|
|
|
307,000
|
|
|
285,000
|
|
|
Other (2)
|
570
|
|
|
417
|
|
|
264,101
|
|
|
180,390
|
|
|
463,000
|
|
|
433,000
|
|
|
Total
|
9,014
|
|
|
8,073
|
|
|
$
|
3,335,770
|
|
|
2,889,163
|
|
|
$
|
370,000
|
|
|
358,000
|
|
|
|
|
Of the total homes in
backlog listed above, 74 homes with a backlog dollar value of $52.8
million and an average sales price of $713,000 represent the
backlog from unconsolidated entities at May 31, 2016, compared
to 90 homes with a backlog dollar value of $52.1 million and an
average sales price of $579,000 at May 31, 2015.
|
|
|
|
(1)
|
During the six months
ended May 31, 2016, the Company acquired 111 homes in
backlog.
|
|
(2)
|
During the six months
ended May 31, 2016, the Company acquired 57 homes in
backlog.
|
|
|
Lennar's reportable
homebuilding segments and all other homebuilding operations not
required to be reported separately have divisions located
in:
|
|
|
East: Florida,
Georgia, Maryland, New Jersey, North Carolina, South Carolina and
Virginia
|
|
Central:
Arizona, Colorado and Texas(1)
|
|
West:
California and Nevada
|
|
Houston:
Houston, Texas
|
|
Other:
Illinois, Minnesota, Oregon, Tennessee and Washington
|
|
|
|
(1)
|
Texas in the Central
reportable segment excludes Houston, Texas, which is its own
reportable segment.
|
|
LENNAR CORPORATION
AND SUBSIDIARIES
Supplemental
Data
(Dollars in
thousands)
(unaudited)
|
|
May
31,
|
|
November
30,
|
|
May
31,
|
|
2016
|
|
2015
|
|
2015
|
|
Lennar Homebuilding
debt
|
$
|
5,316,235
|
|
|
5,025,130
|
|
|
5,263,221
|
|
|
Stockholders'
equity
|
6,118,366
|
|
|
5,648,944
|
|
|
5,138,738
|
|
|
Total
capital
|
$
|
11,434,601
|
|
|
10,674,074
|
|
|
10,401,959
|
|
|
Lennar
Homebuilding debt to total capital
|
46.5
|
%
|
|
47.1
|
%
|
|
50.6
|
%
|
|
|
|
|
|
|
|
Lennar Homebuilding
debt
|
$
|
5,316,235
|
|
|
5,025,130
|
|
|
5,263,221
|
|
|
Less: Lennar
Homebuilding cash and cash equivalents
|
601,192
|
|
|
893,408
|
|
|
638,992
|
|
|
Net Lennar
Homebuilding debt
|
$
|
4,715,043
|
|
|
4,131,722
|
|
|
4,624,229
|
|
|
Net Lennar
Homebuilding debt to total capital (1)
|
43.5
|
%
|
|
42.2
|
%
|
|
47.4
|
%
|
|
(1)
|
Net Lennar
Homebuilding debt to total capital is a non-GAAP financial measure
defined as net Lennar Homebuilding debt (Lennar Homebuilding debt
less Lennar Homebuilding cash and cash equivalents) divided by
total capital (net Lennar Homebuilding debt plus stockholders'
equity). The Company believes the ratio of net Lennar Homebuilding
debt to total capital is a relevant and a useful financial measure
to investors in understanding the leverage employed in Lennar
Homebuilding operations. However, because net Lennar Homebuilding
debt to total capital is not calculated in accordance with GAAP,
this financial measure should not be considered in isolation or as
an alternative to financial measures prescribed by GAAP. Rather,
this non-GAAP financial measure should be used to supplement the
Company's GAAP results.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/lennar-reports-second-quarter-eps-of-095-300287581.html
SOURCE Lennar Corporation