-Reports Net Income Available to Common
Stockholders of $34.8 Million, or $0.22 per Diluted
Share--Home Sales Revenue of $578.7 Million for the
Quarter--Homebuilding Gross Margin of 20.1% for the
Quarter-
TRI Pointe Group, Inc. (the "Company") (NYSE: TPH) today
announced results for the third quarter ended September 30,
2016.
Results and Operational Data for Third Quarter 2016 and
Comparisons to Third Quarter 2015
- Net income available to common
stockholders was $34.8 million, or $0.22 per diluted share,
compared to $50.2 million, or $0.31 per diluted share
- New home orders of 932 compared to 996,
a decrease of 6%
- Active selling communities averaged
119.0 compared to 120.8, a decrease of 1%
- New home orders per average selling
community were 7.8 orders (2.6 monthly) compared to 8.2 orders (2.7
monthly)
- Cancellation rate of 17% compared to
16%, an increase of 100 basis points
- Backlog units at quarter end of 1,711
homes compared to 1,856, a decrease of 8%
- Dollar value of backlog at quarter end
of $950.2 million compared to $1.110 billion, a decrease of
14%
- Average sales price in backlog at
quarter end of $555,000 compared to $598,000, a decrease of 7%
- Home sales revenue of $578.7 million
compared to $642.4 million, a decrease of 10%
- New home deliveries of 1,019 homes
compared to 1,138 homes, a decrease of 10%
- Average sales price of homes delivered
of $568,000 compared to $564,000, an increase of 1%
- Homebuilding gross margin percentage of
20.1% compared to 21.0%, a decrease of 90 basis points
- Excluding interest, impairments and lot
option abandonments, adjusted homebuilding gross margin percentage
was 22.7%*
- SG&A expense as a percentage of
homes sales revenue of 10.9% compared to 8.8%, an increase of 210
basis points
- Ratios of debt-to-capital and net
debt-to-capital of 43.7% and 41.3%*, respectively, as of
September 30, 2016
- Repurchased 852,500 shares of common
stock at an average price of $12.22 for an aggregate dollar amount
of $10.4 million in the three months ended September 30,
2016
- Ended third quarter of 2016 with cash
of $128.7 million and $420.7 million of availability under the
Company's unsecured revolving credit facility
* See "Reconciliation of Non-GAAP Financial Measures"
“We are pleased with the progress we made this quarter,” said
TRI Pointe Group Chief Executive Officer Doug Bauer. “TRI Pointe
delivered on its stated guidance for our ending community count,
deliveries, home sales revenue and homebuilding gross margin
percentage. While the absorption pace in the quarter was slightly
lower than it was last year, I am encouraged by the 26%
year-over-year increase in new home orders we experienced in the
month of September. We expect to continue this momentum into the
fourth quarter due to the success of our new community
openings.”
Third Quarter 2016 Operating Results
Net income available to common stockholders was $34.8 million,
or $0.22 per diluted share in the third quarter of 2016, compared
to net income available to common stockholders of $50.2 million, or
$0.31 per diluted share for the third quarter of 2015. The decrease
in net income available to common stockholders was primarily driven
by an $18.5 million decrease in homebuilding gross margin due to a
90 basis point decrease in homebuilding gross margin percentage and
lower home sales revenue, which resulted from a 10% decrease in new
home deliveries.
Home sales revenue decreased $63.7 million, or 10%, to $578.7
million for the third quarter of 2016, as compared to $642.4
million for the third quarter of 2015. The decrease was primarily
attributable to a 10% decrease in new home deliveries to 1,019,
offset by an increase in average selling price of homes delivered
to $568,000 compared to $564,000 in the third quarter of 2015. The
decrease in deliveries was primarily related to the timing of
deliveries for the year, as we delivered a large number of our
backlog units in the second quarter of 2016, which resulted in a
lower number of backlog units going into the quarter compared to
the prior year period. For the nine months ended September 30,
2016, deliveries were up 7% compared to the same period in the
prior year.
New home orders decreased 6% to 932 homes for the third quarter
of 2016, as compared to 996 homes for the same period in 2015,
which was up 24% from 803 orders for the same period in 2014.
Average selling communities was 119.0 for the third quarter of 2016
compared to 120.8 for the third quarter of 2015. The Company’s
overall absorption rate per average selling community for the third
quarter of 2016 was 7.8 orders (2.6 monthly) compared to 8.2 orders
(2.7 monthly) during the third quarter of 2015.
The Company ended the quarter with 1,711 homes in backlog,
representing approximately $950.2 million. The average sales price
of homes in backlog as of September 30, 2016 decreased
$43,000, or 7%, to $555,000 compared to $598,000 at September 30,
2015.
Homebuilding gross margin percentage for the third quarter of
2016 decreased to 20.1% compared to 21.0% for the third quarter of
2015. Excluding interest and impairments and lot option
abandonments in cost of home sales, adjusted homebuilding gross
margin percentage was 22.7%* for the third quarter of 2016 compared
to 23.1%* for the third quarter of 2015. The decrease in
homebuilding gross margin percentage was largely due to the mix of
homes delivered, with 50 less homes delivered from California which
have gross margins above the Company average.
Selling, general and administrative ("SG&A") expense for the
third quarter of 2016 increased to 10.9% of home sales revenue as
compared to 8.8% for the third quarter of 2015 due to decreased
leverage as a result of the 10% decrease in home sales revenue.
“Overall, we continue to see encouraging trends in all of our
markets,” said TRI Pointe Group President and Chief Operating
Officer Tom Mitchell. “Due to lower new home orders for the
quarter, full year deliveries will likely be on the lower end of
our previously stated range of 4,200 to 4,400 homes. That said, we
expect to end the year with 125 active selling communities compared
to 104 at the end of the prior year. We think this community count
growth and the progress we have made in accelerating the
development of our longer dated assets in California will enable us
to continue to create shareholder value through our homebuilding
operations and reach our goal of delivering 5,100 to 5,400 homes in
2018.”
* See “Reconciliation of Non-GAAP Financial Measures”
Outlook
For the fourth quarter of 2016, the Company expects to open nine
new communities, and close out of seven, resulting in 125 active
selling communities as of December 31, 2016. In addition, the
Company anticipates delivering approximately 85% of its 1,711 units
in backlog as of September 30, 2016. The Company anticipates its
homebuilding gross margin percentage to be approximately 20% for
the fourth quarter, resulting in a full year homebuilding gross
margin percentage in a range of 20.5% to 21.5%. Finally, the
Company expects its SG&A expense ratio to be approximately 9%
for the fourth quarter, resulting in a full year SG&A expense
ratio in a range of 10.5% to 10.7%.
Earnings Conference Call
The Company will host a conference call via live webcast for
investors and other interested parties beginning at 10:00 a.m.
Eastern Time on Thursday, October 27, 2016. The call will be
hosted by Doug Bauer, Chief Executive Officer; Tom Mitchell,
President and Chief Operating Officer; and Mike Grubbs, Chief
Financial Officer.
Interested parties can listen to the call live on the internet
through the Investor Relations 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 Third Quarter 2016
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
#13646378. An archive of the webcast will be available on the
Company’s website for a limited time.
About TRI Pointe Group, Inc.
Headquartered in Irvine, California, TRI Pointe Group, Inc.
(NYSE: TPH) is one of the top ten largest public homebuilders by
equity market capitalization in the United States. The company
designs, constructs and sells premium single-family homes through
its portfolio of six quality brands across eight states, including
Maracay Homes in Arizona; Pardee Homes in California and Nevada;
Quadrant Homes in Washington; Trendmaker Homes in Texas; TRI Pointe
Homes in California and Colorado; and Winchester Homes in Maryland
and Virginia. Additional information is available at www.TRIPointeGroup.com.
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 projections and estimates concerning the timing and success
of specific projects and our future production, land and lot sales,
operational and financial results, financial condition, prospects,
and capital spending. Our forward-looking statements are generally
accompanied by words such as “anticipate,” “believe,” “estimate,”
“goal,” “expect,” “intend,” “project,” “potential,” “plan,”
“predict,” “will,” 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 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; levels of
competition; the successful execution of our internal performance
plans, including restructuring and cost reduction initiatives;
global economic conditions; raw material prices; oil and other
energy prices; the effect of weather, including the continuing
drought in California; the risk of loss from earthquakes,
volcanoes, fires, floods, droughts, windstorms, hurricanes, pest
infestations and other natural disasters; transportation costs;
federal and state tax policies; the effect of land use, environment
and other governmental regulations; legal proceedings and disputes;
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
customers’ confidential information or other forms of cyber-attack;
our relationship, and actual and potential conflicts of interest,
with Starwood Capital Group or its affiliates; 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.
KEY OPERATIONS AND FINANCIAL
DATA
(dollars in thousands)
(unaudited)
Three Months Ended September 30, Nine Months Ended
September 30, 2016 2015
Change 2016 2015
Change Operating Data: Home sales revenue $ 578,653 $
642,352 $ (63,699 ) $ 1,558,633 $ 1,443,855 $ 114,778 Homebuilding
gross margin $ 116,330 $ 134,809 $ (18,479 ) $ 339,073 $ 294,664 $
44,409 Homebuilding gross margin % 20.1 % 21.0 % (0.9 )% 21.8 %
20.4 % 1.4 % Adjusted homebuilding gross margin %* 22.7 % 23.1 %
(0.4 )% 24.0 % 22.4 % 1.6 % Land and lot sales revenue $ 2,535 $
4,876 $ (2,341 ) $ 70,204 $ 74,366 $ (4,162 ) Land and lot gross
margin $ 801 $ 1,425 $ (624 ) $ 53,231 $ 57,042 $ (3,811 ) Land and
lot gross margin % 31.6 % 29.2 % 2.4 % 75.8 % 76.7 % (0.9 )%
SG&A expense $ 63,002 $ 56,774 $ 6,228 $ 180,436 $ 162,108 $
18,328
SG&A expense as a % of home sales
revenue
10.9 % 8.8 % 2.1 % 11.6 % 11.2 % 0.4 %
Net income available to common
stockholders
$ 34,834 $ 50,162 $ (15,328 ) $ 137,310 $ 120,389 $ 16,921 Adjusted
EBITDA* $ 74,215 $ 99,135 $ (24,920 ) $ 262,945 $ 233,079 $ 29,866
Interest incurred $ 18,601 $ 15,454 $ 3,147 $ 50,030 $ 45,779 $
4,251 Interest in cost of home sales $ 14,385 $ 13,189 $ 1,196 $
34,653 $ 27,540 $ 7,113 Other Data: Net new home orders 932
996 (64 ) 3,339 3,428 (89 ) New homes delivered 1,019 1,138 (119 )
2,784 2,604 180 Average selling price of homes delivered $ 568 $
564 $ 4 $ 560 $ 554 $ 6 Average selling communities 119.0 120.8
(1.8 ) 117.0 117.4 (0.4 ) Selling communities at end of period 123
118 5 N/A N/A N/A Cancellation rate 17 % 16 % 1 % 14 % 14 % 0 %
Backlog (estimated dollar value) $ 950,171 $ 1,109,867 $ (159,696 )
Backlog (homes) 1,711 1,856 (145 ) Average selling price in backlog
$ 555 $ 598 $ (43 )
September 30, December 31,
2016 2015 Change Balance Sheet Data: Cash and
cash equivalents $ 128,715 $ 214,485 $ (85,770 ) Real estate
inventories $ 2,969,148 $ 2,519,273 $ 449,875 Lots owned or
controlled 29,713 27,602 2,111 Homes under construction (1) 1,973
1,531 442 Homes completed, unsold 291 351 (60 ) Debt $ 1,384,482 $
1,170,505 $ 213,977 Stockholders' equity $ 1,785,460 $ 1,664,683 $
120,777 Book capitalization $ 3,169,942 $ 2,835,188 $ 334,754 Ratio
of debt-to-capital 43.7 % 41.3 % 2.4 % Ratio of net
debt-to-capital* 41.3 % 36.5 % 4.8 % (1) Homes
under construction included 52 and 69 models at September 30, 2016
and December 31, 2015, respectively. * See “Reconciliation of
Non-GAAP Financial Measures”
CONSOLIDATED BALANCE SHEETS
(in thousands, except share amounts)
September 30, December 31, 2016
2015 Assets (unaudited) Cash and cash equivalents $
128,715 $ 214,485 Receivables 35,321 43,710 Real estate inventories
2,969,148 2,519,273 Investments in unconsolidated entities 17,205
18,999 Goodwill and other intangible assets, net 161,629 162,029
Deferred tax assets, net 111,887 130,657 Other assets 65,998
48,918 Total assets $ 3,489,903 $ 3,138,071
Liabilities Accounts payable $ 77,667 $ 64,840 Accrued
expenses and other liabilities 219,396 216,263 Unsecured revolving
credit facility 200,000 299,392 Seller financed loans 17,758 2,434
Senior notes 1,166,724 868,679 Total liabilities 1,681,545
1,451,608 Commitments and contingencies
Equity Stockholders' Equity:
Preferred stock, $0.01 par value,
50,000,000 shares authorized; no shares issued and outstanding as
of September 30, 2016 and December 31, 2015, respectively
— —
Common stock, $0.01 par value, 500,000,000
shares authorized; 160,064,678 and 161,813,750 shares issued and
outstanding at September 30, 2016 and December 31, 2015,
respectively
1,601 1,618 Additional paid-in capital 894,681 911,197 Retained
earnings 889,178 751,868 Total stockholders' equity
1,785,460 1,664,683 Noncontrolling interests 22,898 21,780
Total equity 1,808,358 1,686,463 Total liabilities and
equity $ 3,489,903 $ 3,138,071
CONSOLIDATED STATEMENT OF
OPERATIONS
(in thousands, except share and per share
amounts)
(unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2016 2015 2016
2015 Homebuilding: Home sales revenue $
578,653 $ 642,352 $ 1,558,633 $ 1,443,855 Land and lot sales
revenue 2,535 4,876 70,204 74,366 Other operations revenue 606
613 1,790 2,213 Total revenues 581,794
647,841 1,630,627 1,520,434 Cost of home sales 462,323 507,543
1,219,560 1,149,191 Cost of land and lot sales 1,734 3,451 16,973
17,324 Other operations expense 575 570 1,724 1,704 Sales and
marketing 31,852 30,038 90,621 78,958 General and administrative
31,150 26,736 89,815 83,150 Restructuring charges 128 2,010
478 2,730 Homebuilding income from operations
54,032 77,493 211,456 187,377 Equity in (loss) income of
unconsolidated entities (20 ) (150 ) 181 (82 ) Other income, net 21
47 287 272 Homebuilding income before
income taxes 54,033 77,390 211,924 187,567
Financial Services: Revenues 235 300 762 482 Expenses
72 47 183 131 Equity in income (loss) of unconsolidated entities
1,247 147 3,246 (2 ) Financial services income
before income taxes 1,410 400 3,825 349
Income before income taxes 55,443 77,790 215,749 187,916
Provision for income taxes (20,298 ) (28,021 ) (77,701 ) (66,088 )
Net income 35,145 49,769 138,048 121,828 Net (income) loss
attributable to noncontrolling interests (311 ) 393 (738 )
(1,439 ) Net income available to common stockholders $ 34,834
$ 50,162 $ 137,310 $ 120,389 Earnings
per share Basic $ 0.22 $ 0.31 $ 0.85 $ 0.74 Diluted $ 0.22 $ 0.31 $
0.85 $ 0.74 Weighted average shares outstanding Basic 160,614,055
161,772,893 161,456,520 161,651,177 Diluted 161,267,509 162,366,744
161,916,352 162,299,282
MARKET DATA BY REPORTING SEGMENT &
STATE
(dollars in thousands)
(unaudited)
Three Months Ended September 30, Nine Months Ended
September 30, 2016 2015 2016
2015 New
Homes
Delivered
Average
Sales
Price
New
Homes
Delivered
Average
Sales
Price
New
Homes
Delivered
Average
Sales
Price
New
Homes
Delivered
Average
Sales
Price
New Homes Delivered: Maracay Homes 165 $ 412 131 $ 386 400 $
403 307 $ 380 Pardee Homes 302 623 314 543 828 587 724 506 Quadrant
Homes 90 531 117 406 287 515 297 426 Trendmaker Homes 121 516 163
495 335 506 394 512 TRI Pointe Homes 260 645 298 752 678 667 611
756 Winchester Homes 81 550 115 599 256
554 271 631 Total 1,019 $ 568
1,138 $ 564 2,784 $ 560 2,604 $
554
Three Months Ended September 30, Nine
Months Ended September 30, 2016 2015 2016
2015 New
Homes
Delivered
Average
Sales
Price
New
Homes
Delivered
Average
Sales
Price
New
Homes
Delivered
Average
Sales
Price
New
Homes
Delivered
Average
Sales
Price
New Homes Delivered: California 412 $ 716 462 $ 720 1,093 $
707 969 $ 700 Colorado 30 526 51 512 118 505 128 488 Maryland 55
510 58 483 169 504 120 528 Virginia 26 634 57 716 87 650 151 714
Arizona 165 412 131 386 400 403 307 380 Nevada 120 377 99 361 295
360 238 368 Texas 121 516 163 495 335 506 394 512 Washington 90
531 117 406 287 515 297
426 Total 1,019 $ 568 1,138 $ 564
2,784 $ 560 2,604 $ 554
MARKET DATA BY REPORTING SEGMENT &
STATE, continued
(unaudited)
Three Months Ended September 30, Nine Months Ended
September 30, 2016 2015 2016
2015
Net NewHomeOrders
AverageSellingCommunities
Net NewHomeOrders
AverageSellingCommunities
Net New
Home
Orders
Average
Selling
Communities
Net New
Home
Orders
Average
Selling
Communities
Net New Home Orders: Maracay Homes 134 17.8 150 17.2 526
18.1 495 17.3 Pardee Homes 283 22.5 291 25.0 936 22.8 954 22.8
Quadrant Homes 49 7.3 87 11.8 274 8.5 353 10.8 Trendmaker Homes 130
29.0 125 25.0 385 26.8 381 26.0 TRI Pointe Homes 239 28.7 234 28.3
883 27.3 935 27.0 Winchester Homes 97 13.7 109
13.5 335 13.5 310 13.5 Total 932
119.0 996 120.8 3,339 117.0
3,428 117.4
Three Months Ended September
30, Nine Months Ended September 30, 2016
2015 2016 2015
Net NewHome
Orders
AverageSellingCommunities
Net NewHomeOrders
AverageSellingCommunities
Net NewHomeOrders
AverageSellingCommunities
Net NewHomeOrders
AverageSellingCommunities
Net New Home Orders: California 380 35.0 392 35.5 1,333 34.3
1,421 33.2 Colorado 31 5.0 34 6.0 107 4.8 168 6.4 Maryland 72 7.2
71 6.0 214 6.7 165 5.8 Virginia 25 6.5 38 7.5 121 6.8 145 7.7
Arizona 134 17.8 150 17.2 526 18.1 495 17.3 Nevada 111 11.2 99 11.8
379 11.0 300 10.2 Texas 130 29.0 125 25.0 385 26.8 381 26.0
Washington 49 7.3 87 11.8 274
8.5 353 10.8 Total 932 119.0 996
120.8 3,339 117.0 3,428 117.4
MARKET DATA BY REPORTING SEGMENT &
STATE, continued
(dollars in thousands)
(unaudited)
As of September 30, 2016 As of September 30,
2015 BacklogUnits
BacklogDollarValue
AverageSalesPrice
BacklogUnits
BacklogDollarValue
AverageSalesPrice
Backlog: Maracay Homes 329 $ 144,127 $ 438 293 $ 118,164 $
403 Pardee Homes 382 182,263 477 448 296,477 662 Quadrant Homes 130
83,467 642 169 79,955 473 Trendmaker Homes 186 98,874 532 205
108,250 528 TRI Pointe Homes 495 319,823 646 567 388,336 685
Winchester Homes 189 121,617 643 174
118,685 682 Total 1,711 $ 950,171 $ 555
1,856 $ 1,109,867 $ 598
As of
September 30, 2016 As of September 30, 2015
BacklogUnits
BacklogDollarValue
AverageSalesPrice
BacklogUnits
BacklogDollarValue
AverageSalesPrice
Backlog: California 641 $ 387,125 $ 604 770 $ 577,053 $ 749
Colorado 73 42,809 586 124 62,445 504 Maryland 122 75,444 618 98
59,200 604 Virginia 67 46,172 689 76 59,485 783 Arizona 329 144,127
438 293 118,164 403 Nevada 163 72,153 443 121 45,315 375 Texas 186
98,874 532 205 108,250 528 Washington 130 83,467 642
169 79,955 473 Total 1,711 $ 950,171
$ 555 1,856 $ 1,109,867 $ 598
MARKET DATA BY REPORTING SEGMENT &
STATE, continued
(unaudited)
September 30, December 31, 2016
2015 Lots Owned or Controlled: Maracay Homes 2,258
1,811 Pardee Homes 16,987 16,679 Quadrant Homes 1,895 1,274
Trendmaker Homes 2,130 1,858 TRI Pointe Homes 3,960 3,628
Winchester Homes 2,483 2,352 Total 29,713 27,602
September 30, December 31, 2016
2015 Lots Owned or Controlled: California 17,452
17,527 Colorado 1,159 876 Maryland 1,875 1,716 Virginia 608 636
Arizona 2,258 1,811 Nevada 2,336 1,904 Texas 2,130 1,858 Washington
1,895 1,274 Total 29,713 27,602
September 30, December 31, 2016 2015
Lots by Ownership Type: Lots owned 25,228 24,733 Lots
controlled (1) 4,485 2,869 Total 29,713 27,602
(1) As of September 30, 2016 and December 31, 2015,
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 tables reconcile 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 September 30,
2016 %
2015 % (dollars in thousands)
Home sales revenue $ 578,653 100.0 % $ 642,352 100.0 % Cost of home
sales 462,323 79.9 % 507,543 79.0 % Homebuilding
gross margin 116,330 20.1 % 134,809 21.0 % Add: interest in cost of
home sales 14,385 2.5 % 13,189 2.1 % Add: impairments and lot
option abandonments 389 0.1 % 366 0.1 % Adjusted
homebuilding gross margin $ 131,104 22.7 % $ 148,364
23.1 % Homebuilding gross margin percentage 20.1 % 21.0 % Adjusted
homebuilding gross margin percentage 22.7 % 23.1 %
Nine Months Ended September 30, 2016 %
2015 % (dollars in thousands) Home sales revenue $
1,558,633 100.0 % $ 1,443,855 100.0 % Cost of home sales 1,219,560
78.2 % 1,149,191 79.6 % Homebuilding gross margin
339,073 21.8 % 294,664 20.4 % Add: interest in cost of home sales
34,653 2.2 % 27,540 1.9 % Add: impairments and lot option
abandonments 678 0.0 % 1,593 0.1 % Adjusted
homebuilding gross margin $ 374,404 24.0 % $ 323,797
22.4 % Homebuilding gross margin percentage 21.8 % 20.4 % Adjusted
homebuilding gross margin percentage 24.0 % 22.4 %
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-capital. We
believe that the ratio of net debt-to-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.
September 30,
2016 December 31,
2015 Unsecured revolving credit facility $ 200,000 $ 299,392
Seller financed loans 17,758 2,434 Senior notes 1,166,724
868,679 Total debt 1,384,482 1,170,505
Stockholders’ equity 1,785,460 1,664,683 Total
capital $ 3,169,942 $ 2,835,188 Ratio of
debt-to-capital(1) 43.7 % 41.3 % Total debt $ 1,384,482 $
1,170,505 Less: Cash and cash equivalents (128,715 ) (214,485 ) Net
debt 1,255,767 956,020 Stockholders’ equity 1,785,460
1,664,683 Total capital $ 3,041,227 $ 2,620,703
Ratio of net debt-to-capital(2) 41.3 % 36.5 % (1)
The ratio of debt-to-capital is computed as the
quotient obtained by dividing debt by the sum of debt plus equity.
(2) The ratio of net debt-to-capital is computed as the quotient
obtained by dividing net debt (which is debt less cash and cash
equivalents) by the sum of net debt plus equity.
RECONCILIATION OF NON-GAAP FINANCIAL
MEASURES (continued)(unaudited)
The following table calculates the non-GAAP 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) income taxes,
(c) depreciation and amortization, (d) expensing of
previously capitalized interest included in costs of home sales and
(e) amortization of stock-based compensation. Adjusted EBITDA
means EBITDA before (f) impairment and lot option abandonments
and (g) restructuring charges. 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 September 30,
Nine Months Ended September 30, 2016
2015 2016
2015 (in thousands) Net income available to common
stockholders $ 34,834 $ 50,162 $ 137,310 $ 120,389 Interest
expense: Interest incurred 18,601 15,454 50,030 45,779 Interest
capitalized (18,601 ) (15,454 ) (50,030 ) (45,779 ) Amortization of
interest in cost of sales 14,415 13,339 34,808 28,019 Provision for
income taxes 20,298 28,021 77,701 66,088 Depreciation and
amortization 866 2,244 2,322 5,414 Amortization of stock-based
compensation 3,285 2,994 9,648 8,536
EBITDA 73,698 96,760 261,789 228,446 Impairments and lot
abandonments 389 365 678 1,903 Restructuring charges 128
2,010 478 2,730 Adjusted EBITDA $ 74,215
$ 99,135 $ 262,945 $ 233,079
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161027005513/en/
Investor Relations Contact:Chris Martin, TRI Pointe
GroupDrew Mackintosh, Mackintosh Investor RelationsInvestorRelations@TRIPointeGroup.com949-478-8696orMedia
Contact:Carol Ruizcruiz@newgroundco.com310-437-0045
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