Increases in Gross Margin Percentage,
Contracts per Community and Lots ControlledLower
Community Count Continues to Challenge
ResultsSolus Litigation Dismissed and Concluded
Favorably for HovnanianCompany Optimistic about
Continued Growth in Controlled Lots and the Future
Hovnanian Enterprises, Inc. (NYSE:HOV), a leading national
homebuilder, reported results for its fiscal second quarter and six
months ended April 30, 2018.
“We are encouraged that the number of
consolidated lots controlled increased year-over-year for the
second consecutive quarter. In order to drive future growth in
revenues and profitability, we continue to focus on growing our
community count through increased investments in land and land
development,” stated Ara K. Hovnanian, Chairman of the Board,
President and Chief Executive Officer. “As expected, our operating
results for the second quarter of fiscal 2018 improved
sequentially. Additionally, our gross margin percentage and
contracts per community, including unconsolidated joint ventures,
continued to exhibit signs of strength, which was evident in
year-over-year improvements for both metrics. Throughout the spring
selling season, most of our communities experienced solid traffic
and robust demand for new homes. We reported 11.2 contracts per
community for the second quarter of fiscal 2018, which is the
highest level of contracts per community we have reported for any
quarter since the fourth quarter of 2005.”
Commenting on the successful resolution of the
litigation matter involving Solus Alternative Asset Management
LP (“Solus”), J. Larry Sorsby Executive Vice President and
Chief Financial Officer, said, “We are pleased that last week the
lawsuit filed by Solus with respect to our financing transaction
with GSO was dismissed, which concludes this matter on favorable
terms for us. All of the benefits to our company provided in our
GSO financing commitments remain completely intact.”
“Provided there are no adverse changes in
current market conditions, we expect further improvements in our
operations resulting in solid profitability during the fourth
quarter of fiscal 2018. Revenue growth from continued investments
in new communities will allow us to leverage our total SG&A and
interest costs, which we expect will lead to higher levels of
profitability in future years. Furthermore, an improving economic
backdrop, coupled with positive demographic trends, should result
in more normalized levels of activity in the national housing
market,” concluded Mr. Hovnanian.
RESULTS FOR THE THREE-MONTH AND
SIX-MONTH PERIODS ENDED APRIL 30, 2018:
- Total revenues decreased 14.2% to $502.5 million in the second
quarter of fiscal 2018, compared with $585.9 million in the second
quarter of fiscal 2017. For the six months ended April 30, 2018,
total revenues decreased 19.2% to $919.7 million compared with
$1.14 billion in the first half of the prior year.
- Homebuilding revenues for unconsolidated joint ventures
increased 12.0% to $96.9 million for the second quarter ended April
30, 2018, compared with $86.6 million in last year’s second
quarter. During the first six months of fiscal 2018, homebuilding
revenues for unconsolidated joint ventures increased 2.6% to $155.5
million compared with $151.5 million in the same period of the
previous year.
- Homebuilding gross margin percentage, after cost of sales
interest expense and land charges, was 13.8% for the second quarter
of fiscal 2018 compared with 12.6% in the prior year’s second
quarter. For the six months ended April 30, 2018, homebuilding
gross margin percentage, after cost of sales interest expense and
land charges, improved to 14.3% compared with 13.0% in the first
half of last year.
- Homebuilding gross margin percentage, before cost of sales
interest expense and land charges, improved 120 basis points to
17.7% for the second quarter of fiscal 2018 compared with 16.5% in
the same quarter one year ago. During the first six months of
fiscal 2018, homebuilding gross margin percentage, before cost of
sales interest expense and land charges, improved 100 basis points
to 17.8% compared with 16.8% in the same period of the previous
year.
- Total SG&A was $61.7 million, or 12.3% of total revenues,
in the second quarter of fiscal 2018 compared with $61.5 million,
or 10.5% of total revenues, in the second quarter of fiscal 2017.
For the first half of fiscal 2018, total SG&A was $124.1
million, or 13.5% of total revenues, compared with $121.6 million,
or 10.7% of total revenues, in the first half of the prior fiscal
year.
- Interest incurred (some of which was expensed and some of which
was capitalized) was $40.0 million for the second quarter of fiscal
2018 compared with $39.2 million in the same quarter one year ago.
For the six months ended April 30, 2018, interest incurred (some of
which was expensed and some of which was capitalized) was $81.2
million compared with $77.9 million during the same six-month
period last year.
- Total interest expense was $45.5 million in the second quarter
of fiscal 2018 compared with $42.6 million in the second quarter of
fiscal 2017. Total interest expense was $86.9 million for the first
half of fiscal 2018 compared with $83.6 million for the same period
of the prior year.
- Loss before income taxes for the quarter ended April 30, 2018
was $9.6 million compared to loss before income taxes of $7.7
million during the second quarter of fiscal 2017. For the first
half of fiscal 2018, the loss before income taxes was $40.0 million
compared with loss of $7.4 million during the first six months of
fiscal 2017.
- Loss before income taxes, excluding land-related charges, joint
venture write-downs and loss (gain) on extinguishment of debt, was
$5.5 million during the second quarter of both fiscal 2018 and
fiscal 2017. For the first half of fiscal 2018, the loss before
income taxes, excluding land-related charges, joint venture
write-downs and loss (gain) on extinguishment of debt, was $34.9
million compared with $9.6 million during the first six months of
fiscal 2017.
- Net loss was $9.8 million, or $0.07 per common share, in the
second quarter of fiscal 2018 compared with a net loss of $6.7
million, or $0.05 per common share, during the same quarter a year
ago. For the six months ended April 30, 2018, the net loss was
$40.6 million, or $0.27 per common share, compared with a net loss
of $6.8 million, or $0.05 per common share, in the first half of
fiscal 2017.
- Contracts per community, including unconsolidated joint
ventures, increased 8.7% to 11.2 contracts per community for the
quarter ended April 30, 2018 compared with 10.3 contracts per
community, including unconsolidated joint ventures, in last year’s
second quarter. Consolidated contracts per community decreased 2.8%
to 10.6 contracts per community for the second quarter of fiscal
2018 compared with 10.9 contracts per community in the second
quarter of fiscal 2017.
- For May 2018, contracts per community, including unconsolidated
joint ventures, increased 5.9% to 3.6 contracts per community
compared to 3.4 contracts per community for the same month one year
ago.
- As of the end of the second quarter of fiscal 2018, community
count, including unconsolidated joint ventures, was 153
communities, a 10.0% year-over-year decrease from 170 communities
at April 30, 2017. Consolidated community count decreased 9.6% to
132 communities as of April 30, 2018 from 146 communities at the
end of the prior year’s second quarter.
- The number of contracts, including unconsolidated joint
ventures, for the second quarter ended April 30, 2018, decreased
2.4% to 1,706 homes from 1,748 homes for the same quarter last
year. The number of consolidated contracts decreased 11.7% to 1,404
homes, during the second quarter of fiscal 2018, compared with
1,590 homes during the second quarter of 2017.
- During the first half of fiscal 2018, the number of contracts,
including unconsolidated joint ventures, was 2,956 homes, a
decrease of 3.4% from 3,060 homes during the first six months of
fiscal 2017. The number of consolidated contracts decreased 12.0%
to 2,431 homes, during the six-month period ended April 30, 2018,
compared with 2,763 homes in the same period of the previous year.
- The dollar value of contract backlog, including unconsolidated
joint ventures, as of April 30, 2018, was $1.34 billion, an
increase of 5.6% compared with $1.27 billion as of April 30, 2017.
The dollar value of consolidated contract backlog, as of April 30,
2018, decreased 17.6% to $900.7 million compared with $1.09 billion
as of April 30, 2017.
- For the quarter ended April 30, 2018, deliveries, including
unconsolidated joint ventures, decreased 4.9% to 1,423 homes
compared with 1,497 homes during the second quarter of fiscal 2017.
Consolidated deliveries were 1,215 homes for the second quarter of
fiscal 2018, a 10.5% decrease compared with 1,358 homes during the
same quarter a year ago.
- For the six months ended April 30, 2018, deliveries, including
unconsolidated joint ventures, decreased 11.4% to 2,564, homes
compared with 2,895 homes in the first half of the prior year.
Consolidated deliveries were 2,240 homes in the first half of
fiscal 2018, a 15.4% decrease compared with 2,648 homes in the same
period in fiscal 2017.
- The contract cancellation rate, including unconsolidated joint
ventures, was 17% in the second quarter of fiscal 2018 compared
with 19% during the second quarter of fiscal 2017. The consolidated
contract cancellation rate for the three months ended April 30,
2018 was 17%, compared with 18% in the second quarter of the prior
year.
- The valuation allowance was $661.8 million as of April 30,
2018. The valuation allowance is a non-cash reserve against the
Company’s tax assets for GAAP purposes. For tax purposes, the tax
deductions associated with the tax assets may be carried forward
for 20 years from the date the deductions were incurred.
LIQUIDITY AND INVENTORY AS OF APRIL 30,
2018:
- Total liquidity at the end of the second quarter of fiscal 2018
was $274.0 million.
- In the second quarter of fiscal 2018, approximately 2,000 lots
were put under option or acquired in 27 communities, including
unconsolidated joint ventures.
- Consolidated lots controlled increased year-over-year to
26,537, as of April 30, 2018, from 26,103 lots at April 30, 2017.
The total consolidated land position, as of April 30, 2018, was
26,537 lots, consisting of 13,949 lots under option and 12,588
owned lots.
RECENT FINANCING TRANSACTION:
- On May 31, 2018, the lawsuit filed by Solus with respect to our
financing transactions with GSO Capital Partners LP, Blackstone’s
credit platform, and certain funds managed or advised by it
(collectively the “GSO Entities”) was dismissed. As part of the
case resolution, K. Hovnanian paid the overdue interest on the 8.0%
Senior Notes due 2019 held by a subsidiary. The case resolution
does not involve any settlement payment or admission of wrongdoing
by any of the Hovnanian-related parties.
- In May 2018, the Company drew down approximately $70.0 million
on the delayed draw portion of the 5% unsecured term loan maturing
in 2027 from the GSO Entities to redeem all outstanding 8% senior
notes due 2019 other than the $26 million held by a Hovnanian
subsidiary. The aggregate principal amount of the 8% senior notes
redeemed was approximately $65.7 million.
- The financing commitments agreed upon previously with GSO,
which include a $125 million senior secured revolver/term loan and
a $25 million tack-on to our 10.5% senior secured notes due 2024,
all remain intact.
WEBCAST INFORMATION:
Hovnanian Enterprises will webcast its fiscal
2018 second quarter financial results conference call at 11:00 a.m.
E.T. on Thursday, June 7, 2018. The webcast can be accessed live
through the “Investor Relations” section of Hovnanian Enterprises’
website at http://www.khov.com. For those who are not available to
listen to the live webcast, an archive of the broadcast will be
available under the “Past Events” section of the Investor Relations
page on the Hovnanian website at http://www.khov.com. The archive
will be available for 12 months.
ABOUT HOVNANIAN ENTERPRISES®,
INC.:
Hovnanian Enterprises, Inc., founded in 1959 by
Kevork S. Hovnanian, is headquartered in Matawan, New Jersey and,
through its subsidiaries, is one of the nation’s largest
homebuilders with operations in Arizona, California, Delaware,
Florida, Georgia, Illinois, Maryland, New Jersey, Ohio,
Pennsylvania, South Carolina, Texas, Virginia, Washington, D.C. and
West Virginia. The Company’s homes are marketed and sold under the
trade names K. Hovnanian® Homes, Brighton Homes® and
Parkwood Builders. Additionally, the Company’s subsidiaries, as
developers of K. Hovnanian’s® Four Seasons communities, make
the Company one of the nation’s largest builders of active
lifestyle communities.
Additional information on Hovnanian Enterprises,
Inc., including a summary investment profile and the Company’s 2017
annual report, can be accessed through the “Investor Relations”
section of the Hovnanian Enterprises’ website at
http://www.khov.com. To be added to Hovnanian's investor e-mail
list, please send an e-mail to IR@khov.com or sign up at
http://www.khov.com.
NON-GAAP FINANCIAL
MEASURES:
Consolidated earnings before interest
expense and income taxes (“EBIT”) and before depreciation and
amortization (“EBITDA”) and before inventory impairment loss and
land option write-offs and loss (gain) on extinguishment of debt
(“Adjusted EBITDA”) are not U.S. generally accepted accounting
principles (GAAP) financial measures. The most directly comparable
GAAP financial measure is net (loss). The reconciliation for
historical periods of EBIT, EBITDA and Adjusted EBITDA to net
(loss) is presented in a table attached to this earnings
release.
Homebuilding gross margin, before cost
of sales interest expense and land charges, and homebuilding gross
margin percentage, before cost of sales interest expense and land
charges, are non-GAAP financial measures. The most directly
comparable GAAP financial measures are homebuilding gross margin
and homebuilding gross margin percentage, respectively. The
reconciliation for historical periods of homebuilding gross margin,
before cost of sales interest expense and land charges, and
homebuilding gross margin percentage, before cost of sales interest
expense and land charges, to homebuilding gross margin and
homebuilding gross margin percentage, respectively, is presented in
a table attached to this earnings release.
(Loss) Before Income Taxes Excluding
Land-Related Charges, Joint Venture Write-Downs and Loss (Gain) on
Extinguishment of Debt is a non-GAAP financial
measure. The most directly comparable GAAP financial measure is
(Loss) Income Before Income Taxes. The reconciliation for
historical periods of (Loss) Before Income Taxes Excluding
Land-Related Charges, Joint Venture Write-Downs and Loss (Gain) on
Extinguishment of Debt to (Loss) Income
Before Income Taxes is presented in a table attached to
this earnings release.
Total liquidity is comprised of $248.8
million of cash and cash equivalents, $13.8 million of restricted
cash required to collateralize a performance bond and letters of
credit and $11.4 million of availability under the unsecured
revolving credit facility as of April 30, 2018.
FORWARD-LOOKING STATEMENTS
All statements in this press release
that are not historical facts should be considered as
“Forward-Looking Statements” within the meaning of the “Safe
Harbor” provisions of the Private Securities Litigation Reform Act
of 1995. Such statements involve known and unknown risks,
uncertainties and other factors that may cause actual results,
performance or achievements of the Company to be materially
different from any future results, performance or achievements
expressed or implied by the forward-looking statements. Such
forward-looking statements include but are not limited to
statements related to the Company’s goals and expectations with
respect to its financial results for future financial periods.
Although we believe that our plans, intentions and expectations
reflected in, or suggested by, such forward-looking statements are
reasonable, we can give no assurance that such plans, intentions or
expectations will be achieved. By their nature, forward-looking
statements: (i) speak only as of the date they are made, (ii) are
not guarantees of future performance or results and (iii) are
subject to risks, uncertainties and assumptions that are difficult
to predict or quantify. Therefore, actual results could differ
materially and adversely from those forward-looking statements as a
result of a variety of factors. Such risks, uncertainties and other
factors include, but are not limited to, (1) changes in general and
local economic, industry and business conditions and impacts of a
sustained homebuilding downturn; (2) adverse weather and other
environmental conditions and natural disasters; (3) levels of
indebtedness and restrictions on the Company’s operations and
activities imposed by the agreements governing the Company’s
outstanding indebtedness; (4) the Company's sources of liquidity;
(5) changes in credit ratings; (6) changes in market conditions and
seasonality of the Company’s business; (7) the availability and
cost of suitable land and improved lots; (8) shortages in, and
price fluctuations of, raw materials and labor; (9) regional and
local economic factors, including dependency on certain sectors of
the economy, and employment levels affecting home prices and sales
activity in the markets where the Company builds homes; (10)
fluctuations in interest rates and the availability of mortgage
financing; (11) changes in tax laws affecting the after-tax costs
of owning a home; (12) operations through joint ventures with third
parties; (13) government regulation, including regulations
concerning development of land, the home building, sales and
customer financing processes, tax laws and the environment; (14)
product liability litigation, warranty claims and claims made by
mortgage investors; (15) levels of competition; (16) availability
and terms of financing to the Company; (17) successful
identification and integration of acquisitions; (18) significant
influence of the Company’s controlling stockholders; (19)
availability of net operating loss carryforwards; (20) utility
shortages and outages or rate fluctuations; (21) geopolitical
risks, terrorist acts and other acts of war; (22) increases in
cancellations of agreements of sale; (23) loss of key management
personnel or failure to attract qualified personnel; (24)
information technology failures and data security breaches; (25)
legal claims brought against us and not resolved in our favor; and
(26) certain risks, uncertainties and other factors described in
detail in the Company’s Annual Report on Form 10-K for the fiscal
year ended October 31, 2017 and subsequent filings with the
Securities and Exchange Commission. Except as otherwise required by
applicable securities laws, we undertake no obligation to publicly
update or revise any forward-looking statements, whether as a
result of new information, future events, changed circumstances or
any other reason.
(Financial Tables Follow)
Hovnanian Enterprises, Inc. |
|
|
|
|
|
|
|
April 30, 2018 |
|
|
|
|
|
|
|
Statements
of Consolidated Operations |
|
|
|
|
|
|
|
(Dollars in
Thousands, Except Per Share Data) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
|
|
April 30, |
|
April 30, |
|
|
|
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Total
Revenues |
$502,544 |
|
|
$585,935 |
|
|
$919,710 |
|
|
$1,137,944 |
|
Costs and
Expenses (a) |
|
512,025 |
|
|
|
588,830 |
|
|
|
954,486 |
|
|
|
1,146,496 |
|
(Loss) Gain
on Extinguishment of Debt |
|
(1,440 |
) |
|
|
(242 |
) |
|
|
(1,440 |
) |
|
|
7,404 |
|
Income
(Loss) from Unconsolidated Joint Ventures |
|
1,343 |
|
|
|
(4,562 |
) |
|
|
(3,833 |
) |
|
|
(6,228 |
) |
Loss Before
Income Taxes |
|
(9,578 |
) |
|
|
(7,699 |
) |
|
|
(40,049 |
) |
|
|
(7,376 |
) |
Income Tax
Provision (Benefit) |
|
245 |
|
|
|
(1,017 |
) |
|
|
583 |
|
|
|
(551 |
) |
Net
(Loss) |
$(9,823 |
) |
|
$(6,682 |
) |
|
$(40,632 |
) |
|
$(6,825 |
) |
|
|
|
|
|
|
|
|
|
|
|
Per Share
Data: |
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
Net (Loss)
Per Common Share |
$(0.07 |
) |
|
$(0.05 |
) |
|
$(0.27 |
) |
|
$(0.05 |
) |
|
Weighted
Average Number of |
|
|
|
|
|
|
|
|
|
Common
Shares Outstanding (b) |
|
148,435 |
|
|
|
147,558 |
|
|
|
148,228 |
|
|
|
147,556 |
|
Assuming
Dilution: |
|
|
|
|
|
|
|
|
Net (Loss)
Per Common Share |
$(0.07 |
) |
|
$(0.05 |
) |
|
$(0.27 |
) |
|
$(0.05 |
) |
|
Weighted
Average Number of |
|
|
|
|
|
|
|
|
|
Common
Shares Outstanding (b) |
|
148,435 |
|
|
|
147,558 |
|
|
|
148,228 |
|
|
|
147,556 |
|
|
|
|
|
|
|
|
|
|
|
|
(a)
Includes inventory impairment loss and land option write-offs. |
|
|
|
|
|
|
|
(b)
For periods with a net (loss), basic shares are used in accordance
with GAAP rules. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hovnanian Enterprises, Inc. |
|
|
|
|
|
|
|
April 30, 2018 |
|
|
|
|
|
|
|
Reconciliation of (Loss) Before Income Taxes Excluding Land-Related
Charges, Joint Venture Write-Downs and Loss (Gain) on
Extinguishment of Debt to (Loss) Before Income Taxes |
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
Thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
|
|
April 30, |
|
April 30, |
|
|
|
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
(Loss)
Before Income Taxes |
$(9,578 |
) |
|
$(7,699 |
) |
|
$(40,049 |
) |
|
$(7,376 |
) |
Inventory
Impairment Loss and Land Option Write-Offs |
|
2,673 |
|
|
|
1,953 |
|
|
|
3,087 |
|
|
|
5,137 |
|
Unconsolidated Joint Venture Investment Write-Downs |
|
- |
|
|
|
- |
|
|
|
660 |
|
|
|
- |
|
Loss (Gain)
on Extinguishment of Debt |
|
1,440 |
|
|
|
242 |
|
|
|
1,440 |
|
|
|
(7,404 |
) |
(Loss)
Before Income Taxes Excluding Land-Related Charges, Joint Venture
Write-Downs and Loss (Gain) on Extinguishment of Debt (a) |
$(5,465 |
) |
|
$(5,504 |
) |
|
$(34,862 |
) |
|
$(9,643 |
) |
|
|
|
|
|
|
|
|
|
|
|
(a) (Loss)
Before Income Taxes Excluding Land-Related Charges, Joint Venture
Write-Downs and Loss (Gain) on Extinguishment of Debt is a non-GAAP
financial measure. The most directly comparable GAAP financial
measure is (Loss) Before Income Taxes. |
Hovnanian
Enterprises, Inc. |
|
|
|
|
|
|
|
|
April 30,
2018 |
|
|
|
|
|
|
|
|
Gross Margin |
|
|
|
|
|
|
|
|
(Dollars in
Thousands) |
|
|
|
|
|
|
|
|
|
|
Homebuilding Gross Margin |
Homebuilding Gross Margin |
|
|
Three Months Ended |
|
Six Months Ended |
|
|
April 30, |
|
April 30, |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
(Unaudited) |
|
(Unaudited) |
Sale of Homes |
|
$468,117 |
|
|
$567,553 |
|
|
$869,694 |
|
|
$1,098,968 |
|
Cost of Sales,
Excluding Interest Expense (a) |
|
|
385,302 |
|
|
|
473,980 |
|
|
|
714,829 |
|
|
|
913,897 |
|
Homebuilding Gross Margin, Before Cost of Sales Interest Expense
and Land Charges (b) |
|
82,815 |
|
|
|
93,573 |
|
|
|
154,865 |
|
|
|
185,071 |
|
Cost of
Sales Interest Expense, Excluding Land Sales Interest Expense |
|
15,309 |
|
|
|
20,313 |
|
|
|
27,601 |
|
|
|
36,887 |
|
Homebuilding Gross Margin, After Cost of Sales Interest Expense,
Before Land Charges (b) |
|
67,506 |
|
|
|
73,260 |
|
|
|
127,264 |
|
|
|
148,184 |
|
Land Charges |
|
|
2,673 |
|
|
|
1,953 |
|
|
|
3,087 |
|
|
|
5,137 |
|
Homebuilding Gross
Margin |
|
$64,833 |
|
|
$71,307 |
|
|
$124,177 |
|
|
$143,047 |
|
|
|
|
|
|
|
|
|
|
Gross Margin
Percentage |
|
|
13.8 |
% |
|
|
12.6 |
% |
|
|
14.3 |
% |
|
|
13.0 |
% |
Gross
Margin Percentage, Before Cost of Sales Interest Expense and
Land Charges (b) |
|
17.7 |
% |
|
|
16.5 |
% |
|
|
17.8 |
% |
|
|
16.8 |
% |
Gross
Margin Percentage, After Cost of Sales Interest Expense, Before
Land Charges (b) |
|
14.4 |
% |
|
|
12.9 |
% |
|
|
14.6 |
% |
|
|
13.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
Land Sales Gross Margin |
Land Sales Gross Margin |
|
|
Three Months Ended |
|
Six Months Ended |
|
|
April 30, |
|
April 30, |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
|
(Unaudited) |
|
(Unaudited) |
Land and Lot Sales |
|
$20,505 |
|
|
$2,711 |
|
|
$20,505 |
|
|
$9,712 |
|
Cost of Sales,
Excluding Interest and Land Charges (a) |
|
|
7,710 |
|
|
|
1,460 |
|
|
|
7,710 |
|
|
|
6,570 |
|
Land and
Lot Sales Gross Margin, Excluding Interest and Land Charges |
|
12,795 |
|
|
|
1,251 |
|
|
|
12,795 |
|
|
|
3,142 |
|
Land and Lot Sales
Interest |
|
|
4,055 |
|
|
|
24 |
|
|
|
4,055 |
|
|
|
1,772 |
|
Land and
Lot Sales Gross Margin, Including Interest and Excluding Land
Charges |
$8,740 |
|
|
$1,227 |
|
|
$8,740 |
|
|
$1,370 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Does
not include cost associated with walking away from land options or
inventory impairment losses which are recorded as Inventory
impairment loss and land option write-offs in the Condensed
Consolidated Statements of Operations. |
(b)
Homebuilding Gross Margin, Before Cost of Sales Interest Expense
and Land Charges, and Homebuilding Gross Margin Percentage, before
Cost of Sales Interest Expense and Land Charges, are non-GAAP
financial measures. The most directly comparable GAAP financial
measures are Homebuilding Gross Margin and Homebuilding Gross
Margin Percentage, respectively. |
Hovnanian
Enterprises, Inc. |
|
|
|
|
|
|
|
April 30,
2018 |
|
|
|
|
|
|
|
Reconciliation of
Adjusted EBITDA to Net (Loss) |
|
|
|
|
|
|
|
(Dollars in
Thousands) |
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
April 30, |
|
April 30, |
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
(Unaudited) |
|
(Unaudited) |
Net (Loss) |
$(9,823 |
) |
|
$(6,682 |
) |
|
$(40,632 |
) |
|
$(6,825 |
) |
Income Tax Provision
(Benefit) |
|
245 |
|
|
|
(1,017 |
) |
|
|
583 |
|
|
|
(551 |
) |
Interest Expense |
|
45,452 |
|
|
|
42,634 |
|
|
|
86,875 |
|
|
|
83,583 |
|
EBIT (a) |
|
35,874 |
|
|
|
34,935 |
|
|
|
46,826 |
|
|
|
76,207 |
|
Depreciation |
|
719 |
|
|
|
1,071 |
|
|
|
1,509 |
|
|
|
2,083 |
|
Amortization of Debt
Costs |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
1,632 |
|
EBITDA (b) |
|
36,593 |
|
|
|
36,006 |
|
|
|
48,335 |
|
|
|
79,922 |
|
Inventory Impairment
Loss and Land Option Write-offs |
|
2,673 |
|
|
|
1,953 |
|
|
|
3,087 |
|
|
|
5,137 |
|
Loss (Gain) on
Extinguishment of Debt |
|
1,440 |
|
|
|
242 |
|
|
|
1,440 |
|
|
|
(7,404 |
) |
Adjusted EBITDA
(c) |
$40,706 |
|
|
$38,201 |
|
|
$52,862 |
|
|
$77,655 |
|
|
|
|
|
|
|
|
|
Interest Incurred |
$40,014 |
|
|
$39,156 |
|
|
$81,179 |
|
|
$77,855 |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA to
Interest Incurred |
|
1.02 |
|
|
|
0.98 |
|
|
|
0.65 |
|
|
|
1.00 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
EBIT is a non-GAAP financial measure. The most directly comparable
GAAP financial measure is net (loss). EBIT represents earnings
before interest expense and income taxes. |
(b)
EBITDA is a non-GAAP financial measure. The most directly
comparable GAAP financial measure is net (loss). EBITDA represents
earnings before interest expense, income taxes, depreciation and
amortization. |
(c)
Adjusted EBITDA is a non-GAAP financial measure. The most directly
comparable GAAP financial measure is net (loss). Adjusted EBITDA
represents earnings before interest expense, income taxes,
depreciation, amortization, inventory impairment loss and land
option write-offs and loss (gain) on extinguishment of debt. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hovnanian
Enterprises, Inc. |
|
|
|
|
|
|
|
April 30,
2018 |
|
|
|
|
|
|
|
Interest Incurred,
Expensed and Capitalized |
|
|
|
|
|
|
|
(Dollars in
Thousands) |
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
April 30, |
|
April 30, |
|
|
2018 |
|
|
|
2017 |
|
|
|
2018 |
|
|
|
2017 |
|
|
(Unaudited) |
|
(Unaudited) |
Interest Capitalized at
Beginning of Period |
$70,793 |
|
|
$94,438 |
|
|
$71,051 |
|
|
$96,688 |
|
Plus Interest
Incurred |
|
40,014 |
|
|
|
39,156 |
|
|
|
81,179 |
|
|
|
77,855 |
|
Less Interest
Expensed |
|
45,452 |
|
|
|
42,634 |
|
|
|
86,875 |
|
|
|
83,583 |
|
Interest Capitalized at
End of Period (a) |
$65,355 |
|
|
$90,960 |
|
|
$65,355 |
|
|
$90,960 |
|
|
|
|
|
|
|
|
|
(a)
Capitalized interest amounts are shown gross before allocating any
portion of impairments, if any, to capitalized interest. |
|
|
|
|
|
|
|
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIESCONDENSED
CONSOLIDATED BALANCE SHEETS(In Thousands) |
|
|
|
|
|
|
|
|
|
April 30,2018 |
|
|
October 31,2017 |
|
|
|
(Unaudited) |
|
|
(1) |
|
ASSETS |
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
Cash and
cash equivalents |
|
|
$248,815 |
|
|
|
$463,697 |
|
Restricted cash and cash equivalents |
|
|
|
13,957 |
|
|
|
|
2,077 |
|
Inventories: |
|
|
|
|
|
|
|
|
Sold and
unsold homes and lots under development |
|
|
|
856,620 |
|
|
|
|
744,119 |
|
Land and
land options held for future development or sale |
|
|
|
104,518 |
|
|
|
|
140,924 |
|
Consolidated inventory not owned |
|
|
|
78,907 |
|
|
|
|
124,784 |
|
Total inventories |
|
|
|
1,040,045 |
|
|
|
|
1,009,827 |
|
Investments in and advances to unconsolidated joint ventures |
|
|
|
88,344 |
|
|
|
|
115,090 |
|
Receivables, deposits and notes, net |
|
|
|
70,168 |
|
|
|
|
58,149 |
|
Property,
plant and equipment, net |
|
|
|
19,944 |
|
|
|
|
52,919 |
|
Prepaid
expenses and other assets |
|
|
|
40,529 |
|
|
|
|
37,026 |
|
Total homebuilding |
|
|
|
1,521,802 |
|
|
|
|
1,738,785 |
|
|
|
|
|
|
|
|
|
|
Financial services cash
and cash equivalents |
|
|
|
4,960 |
|
|
|
|
5,623 |
|
Financial services
other assets |
|
|
|
115,729 |
|
|
|
|
156,490 |
|
Total assets |
|
|
$1,642,491 |
|
|
|
$1,900,898 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
Nonrecourse mortgages secured by inventory, net of debt issuance
costs |
|
|
$70,644 |
|
|
|
$64,512 |
|
Accounts
payable and other liabilities |
|
|
|
288,120 |
|
|
|
|
335,057 |
|
Customers’ deposits |
|
|
|
30,997 |
|
|
|
|
33,772 |
|
Nonrecourse mortgages secured by operating properties |
|
|
|
- |
|
|
|
|
13,012 |
|
Liabilities from inventory not owned, net of debt issuance
costs |
|
|
|
53,515 |
|
|
|
|
91,101 |
|
Revolving
and term loan credit facilities, net of debt issuance costs |
|
|
|
257,129 |
|
|
|
|
124,987 |
|
Notes
payable (net of discount, premium and debt issuance costs) and
accrued interest |
|
|
|
1,340,246 |
|
|
|
|
1,554,687 |
|
Total homebuilding |
|
|
|
2,040,651 |
|
|
|
|
2,217,128 |
|
|
|
|
|
|
|
|
|
|
Financial services |
|
|
|
99,914 |
|
|
|
|
141,914 |
|
Income taxes
payable |
|
|
|
1,902 |
|
|
|
|
2,227 |
|
Total liabilities |
|
|
|
2,142,467 |
|
|
|
|
2,361,269 |
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity
deficit: |
|
|
|
|
|
|
|
|
Preferred
stock, $0.01 par value - authorized 100,000 shares; issued and
outstanding 5,600shares with a liquidation preference of $140,000
at April 30, 2018 and at October 31, 2017 |
|
|
|
135,299 |
|
|
|
|
135,299 |
|
Common
stock, Class A, $0.01 par value – authorized 400,000,000 shares;
issued144,403,778 shares at April 30, 2018 and 144,046,073 shares
at October 31, 2017 |
|
|
|
1,444 |
|
|
|
|
1,440 |
|
Common
stock, Class B, $0.01 par value (convertible to Class A at time of
sale) –authorized 60,000,000 shares; issued 16,162,230 shares at
April 30, 2018 and 15,999,355shares at October 31, 2017 |
|
|
|
162 |
|
|
|
|
160 |
|
Paid in
capital – common stock |
|
|
|
707,487 |
|
|
|
|
706,466 |
|
Accumulated deficit |
|
|
|
(1,229,008 |
) |
|
|
|
(1,188,376 |
) |
Treasury
stock – at cost – 11,760,763 shares of Class A common stock and
691,748 shares ofClass B common stock at April 30, 2018 and October
31, 2017 |
|
|
|
(115,360 |
) |
|
|
|
(115,360 |
) |
Total stockholders’ equity deficit |
|
|
|
(499,976 |
) |
|
|
|
(460,371 |
) |
Total liabilities and
equity |
|
|
$1,642,491 |
|
|
|
$1,900,898 |
|
(1) Derived from the audited balance sheet as of October 31,
2017
|
|
|
|
|
|
|
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIESCONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS(In Thousands Except Per Share
Data)(Unaudited) |
|
|
|
|
|
|
|
|
|
Three Months Ended April 30, |
|
|
Six Months Ended April 30, |
|
|
|
2018 |
|
|
2017 |
|
|
2018 |
|
|
2017 |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sale of
homes |
|
|
$468,117 |
|
|
|
$567,553 |
|
|
|
$869,694 |
|
|
|
$1,098,968 |
|
Land
sales and other revenues |
|
|
|
21,373 |
|
|
|
|
3,888 |
|
|
|
|
26,074 |
|
|
|
|
11,633 |
|
Total homebuilding |
|
|
|
489,490 |
|
|
|
|
571,441 |
|
|
|
|
895,768 |
|
|
|
|
1,110,601 |
|
Financial
services |
|
|
|
13,054 |
|
|
|
|
14,494 |
|
|
|
|
23,942 |
|
|
|
|
27,343 |
|
Total revenues |
|
|
|
502,544 |
|
|
|
|
585,935 |
|
|
|
|
919,710 |
|
|
|
|
1,137,944 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of
sales, excluding interest |
|
|
|
393,012 |
|
|
|
|
475,440 |
|
|
|
|
722,539 |
|
|
|
|
920,467 |
|
Cost of
sales interest |
|
|
|
19,364 |
|
|
|
|
20,337 |
|
|
|
|
31,656 |
|
|
|
|
38,659 |
|
Inventory
impairment loss and land option write-offs |
|
|
|
2,673 |
|
|
|
|
1,953 |
|
|
|
|
3,087 |
|
|
|
|
5,137 |
|
Total cost of sales |
|
|
|
415,049 |
|
|
|
|
497,730 |
|
|
|
|
757,282 |
|
|
|
|
964,263 |
|
Selling,
general and administrative |
|
|
|
45,544 |
|
|
|
|
45,467 |
|
|
|
|
88,775 |
|
|
|
|
89,875 |
|
Total homebuilding expenses |
|
|
|
460,593 |
|
|
|
|
543,197 |
|
|
|
|
846,057 |
|
|
|
|
1,054,138 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial
services |
|
|
|
8,798 |
|
|
|
|
7,360 |
|
|
|
|
17,139 |
|
|
|
|
14,215 |
|
Corporate
general and administrative |
|
|
|
16,144 |
|
|
|
|
16,071 |
|
|
|
|
35,279 |
|
|
|
|
31,727 |
|
Other
interest |
|
|
|
26,088 |
|
|
|
|
22,297 |
|
|
|
|
55,219 |
|
|
|
|
44,924 |
|
Other
operations |
|
|
|
402 |
|
|
|
|
(95 |
) |
|
|
|
792 |
|
|
|
|
1,492 |
|
Total expenses |
|
|
|
512,025 |
|
|
|
|
588,830 |
|
|
|
|
954,486 |
|
|
|
|
1,146,496 |
|
(Loss) gain on
extinguishment of debt |
|
|
|
(1,440 |
) |
|
|
|
(242 |
) |
|
|
|
(1,440 |
) |
|
|
|
7,404 |
|
Income (loss) from
unconsolidated joint ventures |
|
|
|
1,343 |
|
|
|
|
(4,562 |
) |
|
|
|
(3,833 |
) |
|
|
|
(6,228 |
) |
Loss before income
taxes |
|
|
|
(9,578 |
) |
|
|
|
(7,699 |
) |
|
|
|
(40,049 |
) |
|
|
|
(7,376 |
) |
State and federal
income tax provision (benefit): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
State |
|
|
|
245 |
|
|
|
|
2,292 |
|
|
|
|
583 |
|
|
|
|
2,274 |
|
Federal |
|
|
|
- |
|
|
|
|
(3,309 |
) |
|
|
|
- |
|
|
|
|
(2,825 |
) |
Total income taxes |
|
|
|
245 |
|
|
|
|
(1,017 |
) |
|
|
|
583 |
|
|
|
|
(551 |
) |
Net (loss) |
|
|
$(9,823 |
) |
|
|
$(6,682 |
) |
|
|
$(40,632 |
) |
|
|
$(6,825 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(loss) per common share |
|
|
$(0.07 |
) |
|
|
$(0.05 |
) |
|
|
$(0.27 |
) |
|
|
$(0.05 |
) |
Weighted-average number of common shares outstanding |
|
|
|
148,435 |
|
|
|
|
147,558 |
|
|
|
|
148,228 |
|
|
|
|
147,556 |
|
Assuming dilution: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
(loss) per common share |
|
|
$(0.07 |
) |
|
|
$(0.05 |
) |
|
|
$(0.27 |
) |
|
|
$(0.05 |
) |
Weighted-average number of common shares outstanding |
|
|
|
148,435 |
|
|
|
|
147,558 |
|
|
|
|
148,228 |
|
|
|
|
147,556 |
|
HOVNANIAN ENTERPRISES, INC. |
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT DATA EXCLUDES UNCONSOLIDATED JOINT
VENTURES) |
(UNAUDITED) |
|
|
|
|
|
Three Months - April 30, 2018 |
|
|
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Three Months Ended |
Three Months Ended |
Backlog |
|
|
April 30, |
April 30, |
April 30, |
|
|
|
2018 |
|
2017 |
% Change |
|
2018 |
|
2017 |
% Change |
|
2018 |
|
2017 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(NJ, PA) |
Home |
|
26 |
|
66 |
(60.6 |
)% |
|
47 |
|
99 |
(52.5 |
)% |
|
83 |
|
150 |
(44.7 |
)% |
|
Dollars |
$15,278 |
$29,918 |
(48.9 |
)% |
$23,513 |
$45,917 |
(48.8 |
)% |
$48,715 |
$68,650 |
(29.0 |
)% |
|
Avg. Price |
$587,615 |
$453,300 |
29.6 |
% |
$500,277 |
$463,805 |
7.9 |
% |
$586,928 |
$457,667 |
28.2 |
% |
Mid-Atlantic |
|
|
|
|
|
|
|
|
|
|
(DE, MD, VA, WV) |
Home |
|
212 |
|
226 |
(6.2 |
)% |
|
206 |
|
202 |
2.0 |
% |
|
324 |
|
440 |
(26.4 |
)% |
|
Dollars |
$117,399 |
$123,045 |
(4.6 |
)% |
$104,058 |
$100,120 |
3.9 |
% |
$199,279 |
$273,986 |
(27.3 |
)% |
|
Avg. Price |
$553,766 |
$544,445 |
1.7 |
% |
$505,139 |
$495,647 |
1.9 |
% |
$615,059 |
$622,696 |
(1.2 |
)% |
Midwest |
|
|
|
|
|
|
|
|
|
|
(IL, OH) |
Home |
|
220 |
|
196 |
12.2 |
% |
|
143 |
|
134 |
6.7 |
% |
|
484 |
|
431 |
12.3 |
% |
|
Dollars |
$67,308 |
$61,489 |
9.5 |
% |
$42,816 |
$41,794 |
2.4 |
% |
$132,360 |
$126,138 |
4.9 |
% |
|
Avg. Price |
$305,943 |
$313,721 |
(2.5 |
)% |
$299,415 |
$311,896 |
(4.0 |
)% |
$273,472 |
$292,663 |
(6.6 |
)% |
Southeast |
|
|
|
|
|
|
|
|
|
|
(FL, GA, SC) |
Home |
|
154 |
|
141 |
9.2 |
% |
|
158 |
|
127 |
24.4 |
% |
|
276 |
|
316 |
(12.7 |
)% |
|
Dollars |
$62,741 |
$55,577 |
12.9 |
% |
$60,974 |
$54,005 |
12.9 |
% |
$115,930 |
$136,807 |
(15.3 |
)% |
|
Avg. Price |
$407,404 |
$394,159 |
3.4 |
% |
$385,908 |
$425,235 |
(9.2 |
)% |
$420,037 |
$432,935 |
(3.0 |
)% |
Southwest |
|
|
|
|
|
|
|
|
|
|
(AZ, TX) |
Home |
|
587 |
|
671 |
(12.5 |
)% |
|
466 |
|
639 |
(27.1 |
)% |
|
657 |
|
749 |
(12.3 |
)% |
|
Dollars |
$198,487 |
$227,500 |
(12.8 |
)% |
$158,958 |
$224,898 |
(29.3 |
)% |
$230,600 |
$275,870 |
(16.4 |
)% |
|
Avg. Price |
$338,137 |
$339,047 |
(0.3 |
)% |
$341,112 |
$351,954 |
(3.1 |
)% |
$350,989 |
$368,317 |
(4.7 |
)% |
West |
|
|
|
|
|
|
|
|
|
|
(CA) |
Home |
|
205 |
|
290 |
(29.3 |
)% |
|
195 |
|
157 |
24.2 |
% |
|
369 |
|
418 |
(11.7 |
)% |
|
Dollars |
$93,213 |
$142,522 |
(34.6 |
)% |
$77,798 |
$100,819 |
(22.8 |
)% |
$173,794 |
$211,215 |
(17.7 |
)% |
|
Avg. Price |
$454,697 |
$491,454 |
(7.5 |
)% |
$398,962 |
$642,158 |
(37.9 |
)% |
$470,986 |
$505,299 |
(6.8 |
)% |
Consolidated |
|
|
|
|
|
|
|
|
|
|
Segment Total |
Home |
|
1,404 |
|
1,590 |
(11.7 |
)% |
|
1,215 |
|
1,358 |
(10.5 |
)% |
|
2,193 |
|
2,504 |
(12.4 |
)% |
|
Dollars |
$554,426 |
$640,051 |
(13.4 |
)% |
$468,117 |
$567,553 |
(17.5 |
)% |
$900,678 |
$1,092,666 |
(17.6 |
)% |
|
Avg. Price |
$394,889 |
$402,547 |
(1.9 |
)% |
$385,281 |
$417,933 |
(7.8 |
)% |
$410,706 |
$436,368 |
(5.9 |
)% |
Unconsolidated |
|
|
|
|
|
|
|
|
|
|
Joint Ventures (2) |
Home |
|
302 |
|
158 |
91.1 |
% |
|
208 |
|
139 |
49.6 |
% |
|
636 |
|
310 |
105.2 |
% |
|
Dollars |
$178,973 |
$87,317 |
105.0 |
% |
$96,296 |
$86,215 |
11.7 |
% |
$436,715 |
$174,325 |
150.5 |
% |
|
Avg. Price |
$592,630 |
$552,641 |
7.2 |
% |
$462,964 |
$620,248 |
(25.4 |
)% |
$686,659 |
$562,337 |
22.1 |
% |
Grand |
|
|
|
|
|
|
|
|
|
|
Total |
Home |
|
1,706 |
|
1,748 |
(2.4 |
)% |
|
1,423 |
|
1,497 |
(4.9 |
)% |
|
2,829 |
|
2,814 |
0.5 |
% |
|
Dollars |
$733,399 |
$727,368 |
0.8 |
% |
$564,413 |
$653,768 |
(13.7 |
)% |
$1,337,393 |
$1,266,991 |
5.6 |
% |
|
Avg. Price |
$429,894 |
$416,114 |
3.3 |
% |
$396,636 |
$436,719 |
(9.2 |
)% |
$472,744 |
$450,246 |
5.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
DELIVERIES INCLUDE EXTRAS |
Notes: |
(1)
Contracts are defined as new contracts signed during the period for
the purchase of homes, less cancellations of prior contracts.(2)
Represents home deliveries, home revenues and average prices for
our unconsolidated homebuilding joint ventures for the period. We
provide this data as a supplement to our consolidated results as an
indicator of the volume managed in our unconsolidated homebuilding
joint ventures. Our proportionate share of the income or loss of
unconsolidated homebuilding and land development joint ventures is
reflected as a separate line item in our consolidated financial
statements under “Income (loss) from unconsolidated joint
ventures”. |
HOVNANIAN ENTERPRISES, INC. |
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT DATA EXCLUDES UNCONSOLIDATED JOINT
VENTURES) |
(UNAUDITED) |
|
|
|
|
|
Six Months - April 30, 2018 |
|
|
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Six Months Ended |
Six Months Ending |
Backlog |
|
|
April 30, |
April 30, |
April 30, |
|
|
|
2018 |
|
2017 |
% Change |
|
2018 |
|
2017 |
% Change |
|
2018 |
|
2017 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(NJ, PA) |
Home |
|
72 |
|
149 |
(51.7 |
)% |
|
87 |
|
203 |
(57.1 |
)% |
|
83 |
|
150 |
(44.7 |
)% |
|
Dollars |
$40,641 |
$67,963 |
(40.2 |
)% |
$43,705 |
$98,824 |
(55.8 |
)% |
$48,715 |
$68,650 |
(29.0 |
)% |
|
Avg. Price |
$564,459 |
$456,124 |
23.8 |
% |
$502,354 |
$486,819 |
3.2 |
% |
$586,928 |
$457,667 |
28.2 |
% |
Mid-Atlantic |
|
|
|
|
|
|
|
|
|
|
(DE, MD, VA, WV) |
Home |
|
337 |
|
416 |
(19.0 |
)% |
|
341 |
|
406 |
(16.0 |
)% |
|
324 |
|
440 |
(26.4 |
)% |
|
Dollars |
$180,612 |
$225,291 |
(19.8 |
)% |
$175,067 |
$200,279 |
(12.6 |
)% |
$199,279 |
$273,986 |
(27.3 |
)% |
|
Avg. Price |
$535,939 |
$541,564 |
(1.0 |
)% |
$513,393 |
$493,297 |
4.1 |
% |
$615,059 |
$622,696 |
(1.2 |
)% |
Midwest |
|
|
|
|
|
|
|
|
|
|
(IL, OH) |
Home |
|
385 |
|
341 |
12.9 |
% |
|
283 |
|
284 |
(0.4 |
)% |
|
484 |
|
431 |
12.3 |
% |
|
Dollars |
$116,724 |
$107,055 |
9.0 |
% |
$83,333 |
$85,445 |
(2.5 |
)% |
$132,360 |
$126,138 |
4.9 |
% |
|
Avg. Price |
$303,179 |
$313,946 |
(3.4 |
)% |
$294,463 |
$300,863 |
(2.1 |
)% |
$273,472 |
$292,663 |
(6.6 |
)% |
Southeast |
|
|
|
|
|
|
|
|
|
|
(FL, GA, SC) |
Home |
|
281 |
|
249 |
12.9 |
% |
|
290 |
|
265 |
9.4 |
% |
|
276 |
|
316 |
(12.7 |
)% |
|
Dollars |
$113,196 |
$102,028 |
10.9 |
% |
$117,648 |
$110,391 |
6.6 |
% |
$115,930 |
$136,807 |
(15.3 |
)% |
|
Avg. Price |
$402,831 |
$409,750 |
(1.7 |
)% |
$405,682 |
$416,569 |
(2.6 |
)% |
$420,037 |
$432,935 |
(3.0 |
)% |
Southwest |
|
|
|
|
|
|
|
|
|
|
(AZ, TX) |
Home |
|
998 |
|
1,156 |
(13.7 |
)% |
|
850 |
|
1,170 |
(27.4 |
)% |
|
657 |
|
749 |
(12.3 |
)% |
|
Dollars |
$339,945 |
$398,384 |
(14.7 |
)% |
$287,162 |
$408,158 |
(29.6 |
)% |
$230,600 |
$275,870 |
(16.4 |
)% |
|
Avg. Price |
$340,626 |
$344,623 |
(1.2 |
)% |
$337,838 |
$348,854 |
(3.2 |
)% |
$350,989 |
$368,317 |
(4.7 |
)% |
West |
|
|
|
|
|
|
|
|
|
|
(CA) |
Home |
|
358 |
|
452 |
(20.8 |
)% |
|
389 |
|
320 |
21.6 |
% |
|
369 |
|
418 |
(11.7 |
)% |
|
Dollars |
$162,610 |
$226,945 |
(28.3 |
)% |
$162,779 |
$195,871 |
(16.9 |
)% |
$173,794 |
$211,215 |
(17.7 |
)% |
|
Avg. Price |
$454,218 |
$502,090 |
(9.5 |
)% |
$418,454 |
$612,096 |
(31.6 |
)% |
$470,986 |
$505,299 |
(6.8 |
)% |
Consolidated |
|
|
|
|
|
|
|
|
|
|
Segment Total |
Home |
|
2,431 |
|
2,763 |
(12.0 |
)% |
|
2,240 |
|
2,648 |
(15.4 |
)% |
|
2,193 |
|
2,504 |
(12.4 |
)% |
|
Dollars |
$953,728 |
$1,127,666 |
(15.4 |
)% |
$869,694 |
$1,098,968 |
(20.9 |
)% |
$900,678 |
$1,092,666 |
(17.6 |
)% |
|
Avg. Price |
$392,319 |
$408,131 |
(3.9 |
)% |
$388,256 |
$415,018 |
(6.4 |
)% |
$410,706 |
$436,368 |
(5.9 |
)% |
Unconsolidated |
|
|
|
|
|
|
|
|
|
|
Joint Ventures (2) |
Home |
|
525 |
|
297 |
76.8 |
% |
|
324 |
|
247 |
31.2 |
% |
|
636 |
|
310 |
105.2 |
% |
|
Dollars |
$316,194 |
$167,617 |
88.6 |
% |
$154,395 |
$150,856 |
2.3 |
% |
$436,715 |
$174,325 |
150.5 |
% |
|
Avg. Price |
$602,276 |
$564,368 |
6.7 |
% |
$476,529 |
$610,753 |
(22.0 |
)% |
$686,659 |
$562,337 |
22.1 |
% |
Grand |
|
|
|
|
|
|
|
|
|
|
Total |
Home |
|
2,956 |
|
3,060 |
(3.4 |
)% |
|
2,564 |
|
2,895 |
(11.4 |
)% |
|
2,829 |
|
2,814 |
0.5 |
% |
|
Dollars |
$1,269,922 |
$1,295,283 |
(2.0 |
)% |
$1,024,089 |
$1,249,824 |
(18.1 |
)% |
$1,337,393 |
$1,266,991 |
5.6 |
% |
|
Avg. Price |
$429,608 |
$423,295 |
1.5 |
% |
$399,411 |
$431,718 |
(7.5 |
)% |
$472,744 |
$450,246 |
5.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
DELIVERIES INCLUDE EXTRAS |
Notes: |
(1)
Contracts are defined as new contracts signed during the period for
the purchase of homes, less cancellations of prior contracts.(2)
Represents home deliveries, home revenues and average prices for
our unconsolidated homebuilding joint ventures for the period. We
provide this data as a supplement to our consolidated results as an
indicator of the volume managed in our unconsolidated homebuilding
joint ventures. Our proportionate share of the income or loss of
unconsolidated homebuilding and land development joint ventures is
reflected as a separate line item in our consolidated financial
statements under “Income (loss) from unconsolidated joint
ventures”. |
HOVNANIAN ENTERPRISES, INC. |
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT DATA UNCONSOLIDATED JOINT VENTURES
ONLY) |
(UNAUDITED) |
|
|
|
|
|
Three Months - April 30, 2018 |
|
|
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Three Months Ended |
Three Months Ended |
Backlog |
|
|
April 30, |
April 30, |
April 30, |
|
|
|
2018 |
|
2017 |
% Change |
|
2018 |
|
2017 |
% Change |
|
2018 |
|
2017 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
137 |
|
27 |
407.4 |
% |
|
76 |
|
6 |
1,166.7 |
% |
|
302 |
|
67 |
350.7 |
% |
(NJ, PA) |
Dollars |
$82,865 |
$16,379 |
405.9 |
% |
$29,891 |
$2,945 |
914.9 |
% |
$239,418 |
$34,032 |
603.5 |
% |
|
Avg. Price |
$604,854 |
$606,630 |
(0.3 |
)% |
$393,298 |
$490,833 |
(19.9 |
)% |
$792,774 |
$507,940 |
56.1 |
% |
Mid-Atlantic |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
25 |
|
13 |
92.3 |
% |
|
5 |
|
18 |
(72.2 |
)% |
|
52 |
|
42 |
23.8 |
% |
(DE, MD, VA, WV) |
Dollars |
$20,337 |
$6,337 |
220.9 |
% |
$4,830 |
$11,411 |
(57.7 |
)% |
$42,350 |
$29,252 |
44.8 |
% |
|
Avg. Price |
$813,480 |
$487,462 |
66.9 |
% |
$966,000 |
$633,944 |
52.4 |
% |
$814,422 |
$696,478 |
16.9 |
% |
Midwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
15 |
|
17 |
(11.8 |
)% |
|
14 |
|
4 |
250.0 |
% |
|
31 |
|
28 |
10.7 |
% |
(IL, OH) |
Dollars |
$10,532 |
$12,765 |
(17.5 |
)% |
$8,905 |
$2,978 |
199.1 |
% |
$23,413 |
$20,986 |
11.6 |
% |
|
Avg. Price |
$702,215 |
$750,882 |
(6.5 |
)% |
$636,071 |
$744,514 |
(14.6 |
)% |
$755,280 |
$749,500 |
0.8 |
% |
Southeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
39 |
|
40 |
(2.5 |
)% |
|
48 |
|
42 |
14.3 |
% |
|
95 |
|
97 |
(2.1 |
)% |
(FL, GA, SC) |
Dollars |
$19,635 |
$16,866 |
16.4 |
% |
$21,217 |
$19,551 |
8.5 |
% |
$45,834 |
$48,077 |
(4.7 |
)% |
|
Avg. Price |
$503,456 |
$421,650 |
19.4 |
% |
$442,020 |
$465,497 |
(5.0 |
)% |
$482,465 |
$495,640 |
(2.7 |
)% |
Southwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
44 |
|
10 |
340.0 |
% |
|
29 |
|
2 |
1,350.0 |
% |
|
106 |
|
27 |
292.6 |
% |
(AZ, TX) |
Dollars |
$26,990 |
$7,124 |
278.9 |
% |
$16,357 |
$1,353 |
1,109.0 |
% |
$63,429 |
$18,914 |
235.3 |
% |
|
Avg. Price |
$613,412 |
$712,400 |
(13.9 |
)% |
$564,034 |
$676,282 |
(16.6 |
)% |
$598,385 |
$700,519 |
(14.6 |
)% |
West |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
42 |
|
51 |
(17.6 |
)% |
|
36 |
|
67 |
(46.3 |
)% |
|
50 |
|
49 |
2.0 |
% |
(CA) |
Dollars |
$18,614 |
$27,846 |
(33.2 |
)% |
$15,096 |
$47,977 |
(68.5 |
)% |
$22,271 |
$23,064 |
(3.4 |
)% |
|
Avg. Price |
$443,190 |
$546,000 |
(18.8 |
)% |
$419,333 |
$716,060 |
(41.4 |
)% |
$445,418 |
$470,694 |
(5.4 |
)% |
Unconsolidated Joint Ventures (2) |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
302 |
|
158 |
91.1 |
% |
|
208 |
|
139 |
49.6 |
% |
|
636 |
|
310 |
105.2 |
% |
|
Dollars |
$178,973 |
$87,317 |
105.0 |
% |
$96,296 |
$86,215 |
11.7 |
% |
$436,715 |
$174,325 |
150.5 |
% |
|
Avg. Price |
$592,630 |
$552,641 |
7.2 |
% |
$462,964 |
$620,248 |
(25.4 |
)% |
$686,659 |
$562,337 |
22.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
DELIVERIES INCLUDE EXTRAS |
Notes: |
(1)
Contracts are defined as new contracts signed during the period for
the purchase of homes, less cancellations of prior contracts.(2)
Represents home deliveries, home revenues and average prices for
our unconsolidated homebuilding joint ventures for the period. We
provide this data as a supplement to our consolidated results as an
indicator of the volume managed in our unconsolidated homebuilding
joint ventures. Our proportionate share of the income or loss of
unconsolidated homebuilding and land development joint ventures is
reflected as a separate line item in our consolidated financial
statements under “Income (loss) from unconsolidated joint
ventures”. |
HOVNANIAN ENTERPRISES, INC. |
(DOLLARS IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT DATA UNCONSOLIDATED JOINT VENTURES
ONLY) |
(UNAUDITED) |
|
|
|
|
|
Six Months - April 30, 2018 |
|
|
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Six Months Ended |
Six Months Ended |
Backlog |
|
|
April 30, |
April 30, |
April 30, |
|
|
|
2018 |
|
2017 |
% Change |
|
2018 |
|
2017 |
% Change |
|
2018 |
|
2017 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
191 |
|
52 |
267.3 |
% |
|
106 |
|
12 |
783.3 |
% |
|
302 |
|
67 |
350.7 |
% |
(NJ, PA) |
Dollars |
$127,529 |
$28,454 |
348.2 |
% |
$44,791 |
$4,685 |
856.1 |
% |
$239,418 |
$34,032 |
603.5 |
% |
|
Avg. Price |
$667,689 |
$547,192 |
22.0 |
% |
$422,555 |
$390,378 |
8.2 |
% |
$792,774 |
$507,940 |
56.1 |
% |
Mid-Atlantic |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
50 |
|
30 |
66.7 |
% |
|
9 |
|
28 |
(67.9 |
)% |
|
52 |
|
42 |
23.8 |
% |
(DE, MD, VA, WV) |
Dollars |
$40,038 |
$15,764 |
154.0 |
% |
$8,798 |
$16,601 |
(47.0 |
)% |
$42,350 |
$29,252 |
44.8 |
% |
|
Avg. Price |
$800,760 |
$525,470 |
52.4 |
% |
$977,555 |
$592,893 |
64.9 |
% |
$814,422 |
$696,478 |
16.9 |
% |
Midwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
24 |
|
27 |
(11.1 |
)% |
|
20 |
|
11 |
81.8 |
% |
|
31 |
|
28 |
10.7 |
% |
(IL, OH) |
Dollars |
$16,970 |
$19,992 |
(15.1 |
)% |
$12,275 |
$8,594 |
42.8 |
% |
$23,413 |
$20,986 |
11.6 |
% |
|
Avg. Price |
$707,083 |
$740,444 |
(4.5 |
)% |
$613,750 |
$781,272 |
(21.4 |
)% |
$755,280 |
$749,500 |
0.8 |
% |
Southeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
97 |
|
75 |
29.3 |
% |
|
80 |
|
66 |
21.2 |
% |
|
95 |
|
97 |
(2.1 |
)% |
(FL, GA, SC) |
Dollars |
$45,706 |
$33,745 |
35.4 |
% |
$36,682 |
$29,390 |
24.8 |
% |
$45,834 |
$48,077 |
(4.7 |
)% |
|
Avg. Price |
$471,191 |
$449,934 |
4.7 |
% |
$458,524 |
$445,303 |
3.0 |
% |
$482,465 |
$495,640 |
(2.7 |
)% |
Southwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
93 |
|
22 |
322.7 |
% |
|
44 |
|
2 |
2,100.0 |
% |
|
106 |
|
27 |
292.6 |
% |
(AZ, TX) |
Dollars |
$55,347 |
$15,790 |
250.5 |
% |
$25,170 |
$1,353 |
1,760.3 |
% |
$63,429 |
$18,914 |
235.3 |
% |
|
Avg. Price |
$595,130 |
$717,723 |
(17.1 |
)% |
$572,042 |
$676,500 |
(15.4 |
)% |
$598,385 |
$700,519 |
(14.6 |
)% |
West |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
70 |
|
91 |
(23.1 |
)% |
|
65 |
|
128 |
(49.2 |
)% |
|
50 |
|
49 |
2.0 |
% |
(CA) |
Dollars |
$30,604 |
$53,872 |
(43.2 |
)% |
$26,679 |
$90,233 |
(70.4 |
)% |
$22,271 |
$23,064 |
(3.4 |
)% |
|
Avg. Price |
$437,200 |
$592,004 |
(26.1 |
)% |
$410,446 |
$704,941 |
(41.8 |
)% |
$445,418 |
$470,694 |
(5.4 |
)% |
Unconsolidated Joint Ventures (2) |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
525 |
|
297 |
76.8 |
% |
|
324 |
|
247 |
31.2 |
% |
|
636 |
|
310 |
105.2 |
% |
|
Dollars |
$316,194 |
$167,617 |
88.6 |
% |
$154,395 |
$150,856 |
2.3 |
% |
$436,715 |
$174,325 |
150.5 |
% |
|
Avg. Price |
$602,276 |
$564,368 |
6.7 |
% |
$476,529 |
$610,753 |
(22.0 |
)% |
$686,659 |
$562,337 |
22.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
DELIVERIES INCLUDE EXTRAS |
Notes: |
(1)
Contracts are defined as new contracts signed during the period for
the purchase of homes, less cancellations of prior contracts.(2)
Represents home deliveries, home revenues and average prices for
our unconsolidated homebuilding joint ventures for the period. We
provide this data as a supplement to our consolidated results as an
indicator of the volume managed in our unconsolidated homebuilding
joint ventures. Our proportionate share of the income or loss of
unconsolidated homebuilding and land development joint ventures is
reflected as a separate line item in our consolidated financial
statements under “Income (loss) from unconsolidated joint
ventures”. |
|
|
|
Contact: |
J. Larry
Sorsby |
Jeffrey
T. O’Keefe |
|
Executive
Vice President & CFO |
Vice
President, Investor Relations |
|
732-747-7800 |
732-747-7800 |
|
|
|
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