PulteGroup, Inc. Provides Update on COVID-19 Impacts and Response Actions
May 11 2020 - 7:30AM
Business Wire
PulteGroup, Inc. (NYSE: PHM) today provided an update on actions
the Company has taken in response to the COVID-19 pandemic.
“As part of our first quarter earnings release, we reported that
following a very strong start to the year, housing demand slowed
materially beginning in mid-March as the country was impacted by
the COVID-19 pandemic,” said Ryan Marshall, PulteGroup President
and CEO. “In response to the pandemic, we quickly modified our
sales, construction and administrative processes to allow our
business to operate while protecting the health and safety of our
customers, trade partners and employees.”
“After an initial significant contraction in housing demand,
recent sales trends have been more encouraging as weekly net new
orders went from approximately 140 homes in the last week of March
to almost 400 homes in the final full week of April that ended May
3,” added Marshall. “While order rates have improved, our net new
orders for the month of April were still down approximately 50%
from the prior year, so we have taken steps to reduce our targeted
overhead expense through a combination of layoffs, furloughs and
other cost cutting initiatives. The steps we have taken are
expected to reduce overhead expenses by approximately $100 million
on an annualized basis, of which approximately $65 million will be
realized over the remainder of 2020.”
“We have an outstanding team and employee-oriented culture which
makes these actions extremely difficult, but these changes are
necessary given the current operating environment. To help support
employees impacted by these actions, the Company’s senior leaders,
along with the Board of Directors, have agreed to temporarily
reduce their compensation and the Company will redirect the
foregone compensation into our employee assistance fund. We have
also modified the terms of this fund to significantly broaden the
areas of coverage, as well as to make assistance available to any
PulteGroup employees who were furloughed or released as part of
these recent overhead reductions.”
As a consequence of its actions, the Company anticipates taking
a second-quarter charge of approximately $10 million for severance
and related expenses.
Forward-Looking Statements
This release includes "forward-looking statements." These
statements are subject to a number of risks, uncertainties and
other factors that could cause our actual results, performance,
prospects or opportunities, as well as those of the markets we
serve or intend to serve, to differ materially from those expressed
in, or implied by, these statements. You can identify these
statements by the fact that they do not relate to matters of a
strictly factual or historical nature and generally discuss or
relate to forecasts, estimates or other expectations regarding
future events. Generally, the words “believe,” “expect,” “intend,”
“estimate,” “anticipate,” “plan,” “project,” “may,” “can,” “could,”
“might,” "should", “will” and similar expressions identify
forward-looking statements, including statements related to any
potential impairment charges and the impacts or effects thereof,
expected operating and performing results, planned transactions,
planned objectives of management, future developments or conditions
in the industries in which we participate and other trends,
developments and uncertainties that may affect our business in the
future.
Such risks, uncertainties and other factors include, among other
things: interest rate changes and the availability of mortgage
financing; competition within the industries in which we operate;
the availability and cost of land and other raw materials used by
us in our homebuilding operations; the impact of any changes to our
strategy in responding to the cyclical nature of the industry,
including any changes regarding our land positions and the levels
of our land spend; the availability and cost of insurance covering
risks associated with our businesses; shortages and the cost of
labor; weather related slowdowns; slow growth initiatives and/or
local building moratoria; governmental regulation directed at or
affecting the housing market, the homebuilding industry or
construction activities; uncertainty in the mortgage lending
industry, including revisions to underwriting standards and
repurchase requirements associated with the sale of mortgage loans;
the interpretation of or changes to tax, labor and environmental
laws which could have a greater impact on our effective tax rate or
the value of our deferred tax assets than we anticipate; economic
changes nationally or in our local markets, including inflation,
deflation, changes in consumer confidence and preferences and the
state of the market for homes in general; legal or regulatory
proceedings or claims; our ability to generate sufficient cash flow
in order to successfully implement our capital allocation
priorities; required accounting changes; terrorist acts and other
acts of war; the negative impact of the COVID-19 pandemic on our
financial position and ability to continue our Homebuilding or
Financial Services activities at normal levels or at all in
impacted areas; the duration, effect and severity of the COVID-19
pandemic; the measures that governmental authorities take to
address the COVID-19 pandemic which may precipitate or exacerbate
one or more of the above-mentioned and/or other risks and
significantly disrupt or prevent us from operating our business in
the ordinary course for an extended period of time; and other
factors of national, regional and global scale, including those of
a political, economic, business and competitive nature. See
PulteGroup's Annual Report on Form 10-K for the fiscal year ended
December 31, 2019, and other public filings with the Securities and
Exchange Commission (the "SEC") for a further discussion of these
and other risks and uncertainties applicable to our businesses.
PulteGroup undertakes no duty to update any forward-looking
statement, whether as a result of new information, future events or
changes in PulteGroup's expectations.
About PulteGroup
PulteGroup, Inc. (NYSE: PHM), based in Atlanta, Georgia, is one
of America’s largest homebuilding companies with operations in more
than 40 markets throughout the country. Through its brand portfolio
that includes Centex, Pulte Homes, Del Webb, DiVosta Homes,
American West and John Wieland Homes and Neighborhoods, the company
is one of the industry’s most versatile homebuilders able to meet
the needs of multiple buyer groups and respond to changing consumer
demand. PulteGroup’s purpose is building incredible places where
people can live their dreams.
For more information about PulteGroup, Inc. and PulteGroup’s
brands, go to pultegroup.com; www.pulte.com; www.centex.com;
www.delwebb.com; www.divosta.com; www.jwhomes.com; and
www.americanwesthomes.com. Follow PulteGroup, Inc. on Twitter:
@PulteGroupNews.
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version on businesswire.com: https://www.businesswire.com/news/home/20200511005186/en/
Company Investors: Jim Zeumer (404) 978-6434 Email:
jim.zeumer@pultegroup.com
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