Hovnanian Enterprises, Inc. (NYSE: HOV), a leading national
homebuilder, reported results for its fiscal third quarter and the
nine-month period ended July 31, 2019.
RESULTS FOR THE THREE-MONTH AND
NINE-MONTH PERIODS ENDED JULY 31, 2019:
- Total revenues increased 5.5% to $482.0 million in the third
quarter of fiscal 2019, compared with $456.7 million in the third
quarter of fiscal 2018. For the nine months ended July 31, 2019,
total revenues decreased to $1.30 billion compared with $1.38
billion in the same period during the prior fiscal year.
- Homebuilding revenues for unconsolidated joint ventures was
$121.2 million for the third quarter ended July 31, 2019, compared
with $194.5 million in last year’s third quarter. During the first
nine months of fiscal 2019, homebuilding revenues for
unconsolidated joint ventures was $342.7 million compared with
$350.0 million in the same period during the previous
year.
- Homebuilding gross margin percentage, after cost of sales
interest expense and land charges, was 14.0% for the third quarter
of fiscal 2019 compared with 15.4% during the prior year’s third
quarter. For the nine months ended July 31, 2019, homebuilding
gross margin percentage, after cost of sales interest expense and
land charges, was 14.0% compared with 14.6% last year.
- Homebuilding gross margin percentage, before cost of sales
interest expense and land charges, was 18.4% for both the third
quarter of fiscal 2019 and the third quarter of fiscal 2018. During
the first nine months of fiscal 2019, homebuilding gross margin
percentage, before cost of sales interest expense and land charges,
was 17.7% compared with 18.0% in the same period of the previous
fiscal year.
- Total SG&A was $58.5 million, or 12.1% of total revenues,
in the third quarter of fiscal 2019 compared with $53.9 million, or
11.8% of total revenues, in the same quarter one year ago. For the
first nine months of fiscal 2019, total SG&A was $179.3
million, or 13.8% of total revenues, compared with $178.0 million,
or 12.9% of total revenues, in the same period of the prior fiscal
year.
- Total interest expense was $41.4 million in the third quarter
of fiscal 2019 compared with $38.3 million in the third quarter of
fiscal 2018. Total interest expense was $110.5 million for the
first nine months of fiscal 2019 compared with $125.2 million for
the same period in fiscal 2018.
- Interest incurred (some of which was expensed and some of which
was capitalized) was $42.1 million for the third quarter of fiscal
2019 compared with $40.4 million in the same quarter one year ago.
For the nine months ended July 31, 2019, interest incurred (some of
which was expensed and some of which was capitalized) was $122.3
million compared with $121.6 million last year.
- Income from unconsolidated joint ventures was $3.7 million for
the quarter ended July 31, 2019 compared with $10.7 million in the
third quarter of the previous year. For the first nine months of
fiscal 2019, income from unconsolidated joint ventures was $20.6
million compared with $6.9 million in the same period a year
ago.
- Loss before income taxes for the quarter ended July 31, 2019
was $7.1 million compared with income of $0.1 million during the
third quarter of fiscal 2018. For the first nine months of fiscal
2019, the loss before income taxes was $39.1 million compared with
a loss of $40.0 million during same period of fiscal
2018.
- Net loss was $7.6 million, or $1.27 per common share, in the
third quarter of fiscal 2019 compared with a net loss of $1.0
million, or $0.18 per common share, during the same quarter a year
ago. For the first nine months of fiscal 2019, net loss was $40.3
million, or $6.76 per common share, compared with a net loss of
$41.7 million, or $7.03 per common share, in the same period during
fiscal 2018.
- Consolidated contracts per community increased 10.0% to 11.0
contracts per community for the third quarter of fiscal 2019
compared with 10.0 contracts per community in the third quarter of
fiscal 2018. Contracts per community, including domestic
unconsolidated joint ventures(1), increased 3.9% to 10.6 contracts
per community for the quarter ended July 31, 2019 compared with
10.2 contracts per community, including domestic unconsolidated
joint ventures, in last year’s third quarter.
- The consolidated community count was 138 as of July 31, 2019.
This was a 12.2% year-over-year increase from 123 communities at
the end of the prior year’s third quarter. As of the end of the
third quarter of fiscal 2019, community count, including domestic
unconsolidated joint ventures, was 159 communities. This was a
12.0% year-over-year increase compared with 142 communities at July
31, 2018.
- The number of consolidated contracts increased 22.6% to 1,515
homes, during the third quarter of fiscal 2019, compared with 1,236
homes during the third quarter of fiscal 2018. The number of
contracts, including domestic unconsolidated joint ventures, for
the third quarter ended July 31, 2019, increased 16.6% to 1,690
homes from 1,449 homes for the same quarter last year.
- The number of consolidated contracts increased 8.9% to 3,995
homes, during the nine-month period ended July 31, 2019, compared
with 3,667 homes in the same period of the previous fiscal year.
During the first nine months of fiscal 2019, the number of
contracts, including domestic unconsolidated joint ventures, was
4,497 homes, an increase of 3.0% from 4,368 homes during the same
period in fiscal 2018.
- For August 2019, consolidated contracts per community were 3.2
compared with 2.6 for the same month one year ago. During August
2019, the number of consolidated contracts increased 37.8% to 445
homes from 323 homes in August 2018.
- The dollar value of consolidated contract backlog, as of July
31, 2019, increased 11.4% to $1.05 billion compared with $946.5
million as of July 31, 2018. The dollar value of contract backlog,
including domestic unconsolidated joint ventures, as of July 31,
2019, was $1.28 billion, a decrease of 2.4% compared with $1.31
billion as of July 31, 2018.
- Consolidated deliveries were 1,185 homes for the third quarter
of fiscal 2019, a 3.8% increase compared with 1,142 homes during
the same quarter a year ago. For the quarter ended July 31, 2019,
deliveries, including domestic unconsolidated joint ventures,
decreased 3.5% to 1,377 homes compared with 1,427 homes during the
third quarter of fiscal 2018.
- Consolidated deliveries were 3,237 homes in the first nine
months of fiscal 2019, a 4.3% decrease compared with 3,382 homes in
the same period in fiscal 2018. For the nine months ended July 31,
2019, deliveries, including domestic unconsolidated joint ventures,
decreased 4.3% to 3,772 homes compared with 3,940 homes in the same
period of the prior fiscal year.
- The contract cancellation rate for both consolidated contracts
and contracts including unconsolidated joint ventures were 19% for
both the three months ended July 31, 2019 and the same quarter in
fiscal 2018.
(1)When we refer to
“Domestic Unconsolidated Joint Ventures”, we are excluding results
from our single community unconsolidated joint venture in the
Kingdom of Saudi Arabia (KSA).
LIQUIDITY AND INVENTORY AS OF JULY 31,
2019:
- Total liquidity at the end of the of the third quarter of
fiscal 2019 was $225.1 million.
- In the third quarter of fiscal 2019, approximately 2,100 lots
were put under option or acquired in 30 communities, including
unconsolidated joint ventures.
- As of July 31, 2019, consolidated lots controlled totaled
29,821; which, based on trailing twelve-month deliveries, equaled a
6.3 years supply.
COMMENTS FROM MANAGEMENT: “During the third
quarter of fiscal 2019, we continued to make progress towards our
growth objectives. We achieved year-over-year growth in total
revenues, contracts, community count, contracts per community and
contract backlog. Further, we saw a sequential increase in our
gross margin, before cost of sales interest expense and land
charges, to 18.4% in the third quarter of fiscal 2019 from 16.9% in
the second quarter of fiscal 2019,” stated Ara K. Hovnanian,
Chairman of the Board, President and Chief Executive Officer. “The
improvements we experienced in these metrics are a solid indicator
that we are moving in the right direction.” “Given our pipeline of
future community openings, we expect our community count to
increase in the fourth quarter of fiscal 2019. We continue to
believe that our strategy of using options to control a significant
majority of our lots is a strong risk mitigator should housing
demand fluctuate in the future. Assuming no adverse changes in
current market conditions and excluding land related charges, gains
or losses on extinguishment of debt and other non-recurring items,
we expect to achieve pretax profitability for the full 2019 fiscal
year,” concluded Mr. Hovnanian. WEBCAST
INFORMATION:
Hovnanian Enterprises will webcast its fiscal
2019 third quarter financial results conference call at 11:00 a.m.
E.T. on Thursday, September 5, 2019. 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 name K. HovnanianÒ Homes. Additionally, the Company’s
subsidiaries, as developers of K. Hovnanian’sÒ Four Seasons
communities, make the Company one of the nation’s largest builders
of active lifestyle communities.
Additional information on Hovnanian Enterprises,
Inc. 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 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) income before income taxes
excluding land-related charges, joint venture write-downs and loss
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)
income before income taxes excluding land-related charges, joint
venture write-downs and loss 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 $83.6
million of cash and cash equivalents, $16.5 million of restricted
cash required to collateralize letters of credit and $125.0 million
of availability under the senior secured revolving credit facility
as of July 31, 2019.
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
significant homebuilding downturn; (2) adverse weather and other
environmental conditions and natural disasters; (3) high leverage
and restrictions on the Company’s operations and activities imposed
by the agreements governing the Company’s outstanding indebtedness;
(4) availability and terms of financing to the Company; (5) the
Company’s sources of liquidity; (6) changes in credit ratings; (7)
the seasonality of the Company’s business; (8) the availability and
cost of suitable land and improved lots and sufficient liquidity to
invest in such land and lots; (9) shortages in, and price
fluctuations of, raw materials and labor; (10) reliance on, and the
performance of, subcontractors; (11) 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; (12) fluctuations in
interest rates and the availability of mortgage financing; (13)
increases in cancellations of agreements of sale; (14)
changes in tax laws affecting the after-tax costs of owning a home;
(15) operations through unconsolidated joint ventures with third
parties; (16) government regulation, including regulations
concerning development of land, the home building, sales and
customer financing processes, tax laws and the environment; (17)
legal claims brought against us and not resolved in our favor, such
as product liability litigation, warranty claims and claims made by
mortgage investors; (18) levels of competition; (19) successful
identification and integration of acquisitions; (20) significant
influence of the Company’s controlling stockholders; (21)
availability of net operating loss carryforwards; (22) utility
shortages and outages or rate fluctuations; (23) changes in trade
policies, including the imposition of tariffs and duties on
homebuilding materials and products, and related trade disputes
with and retaliatory measures taken by other countries; (24)
geopolitical risks, terrorist acts and other acts of war; (25) loss
of key management personnel or failure to attract qualified
personnel; (26) information technology failures and data security
breaches; (27) negative publicity; and (28) 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, 2018 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. |
July 31,
2019 |
Statements of
consolidated operations |
(In thousands,
except per share data |
|
|
|
|
Three Months Ended |
Nine Months Ended |
|
|
|
|
July 31, |
|
July 31, |
|
|
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
(Unaudited) |
|
|
|
|
|
|
Total
revenues |
$482,041 |
|
|
|
$456,712 |
|
|
|
$1,303,326 |
|
|
|
$1,376,422 |
|
Costs and expenses
(1) |
|
492,847 |
|
|
|
463,100 |
|
|
|
1,362,964 |
|
|
|
1,417,586 |
|
Loss on
extinguishment of debt |
|
- |
|
|
|
(4,266 |
) |
|
|
- |
|
|
|
(5,706 |
) |
Income from
unconsolidated joint ventures |
|
3,742 |
|
|
|
10,732 |
|
|
|
20,556 |
|
|
|
6,899 |
|
(Loss) income
before income taxes |
|
(7,064 |
) |
|
|
78 |
|
|
|
(39,082 |
) |
|
|
(39,971 |
) |
Income tax
provision |
|
537 |
|
|
|
1,104 |
|
|
|
1,228 |
|
|
|
1,687 |
|
Net (loss) |
$(7,601 |
) |
|
$(1,026 |
) |
|
$(40,310 |
) |
|
$(41,658 |
) |
|
Per share
data: |
|
|
|
|
|
|
|
Basic and assuming
dilution: |
|
|
|
|
|
|
|
|
Net (loss) per
common share |
$(1.27 |
) |
|
$(0.18 |
) |
|
$(6.76 |
) |
|
$(7.03 |
) |
|
Weighted average
number of |
|
|
|
|
|
|
|
|
|
common shares
outstanding (2) |
|
5,971 |
|
|
|
5,947 |
|
|
|
5,964 |
|
|
|
5,935 |
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Includes inventory impairment loss and land option write-offs. |
(2) For
periods with a net (loss), basic shares are used in accordance with
GAAP rules. |
|
|
Hovnanian
Enterprises, Inc. |
July 31,
2019 |
Reconciliation of
(loss) before income taxes excluding land-related charges, joint
venture write-downs and loss on extinguishment of debt to (loss)
income before income taxes |
|
|
|
|
|
|
|
|
|
|
|
(In
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
|
|
July 31, |
|
July 31, |
|
|
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
(Loss) income
before income taxes |
$(7,064 |
) |
|
$78 |
|
|
$(39,082 |
) |
|
$(39,971 |
) |
Inventory
impairment loss and land option write-offs |
|
1,435 |
|
|
|
96 |
|
|
|
3,601 |
|
|
|
3,183 |
|
Unconsolidated
joint venture investment write-downs |
|
854 |
|
|
|
- |
|
|
|
854 |
|
|
|
660 |
|
Loss on
extinguishment of debt |
|
- |
|
|
|
4,266 |
|
|
|
- |
|
|
|
5,706 |
|
(Loss) income
before income taxes excluding land-related charges, joint venture
write-downs and loss on extinguishment of debt (1) |
$(4,775 |
) |
|
$4,440 |
|
|
$(34,627 |
) |
|
$(30,422 |
) |
|
(1) (Loss) income
before income taxes excluding land-related charges, joint venture
write-downs and loss on extinguishment of debt is a non-GAAP
financial measure. The most directly comparable GAAP financial
measure is (loss) income before income taxes. |
|
Hovnanian
Enterprises, Inc. |
July 31,
2019 |
Gross margin |
(In
thousands) |
|
|
Homebuilding Gross Margin |
|
Homebuilding Gross Margin |
|
Homebuilding Gross Margin |
|
|
Three Months Ended |
|
Nine Months Ended |
|
Three Months Ended |
|
|
July 31, |
|
July 31, |
|
April 30, (3) |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
Sale of homes |
|
$467,849 |
|
|
$442,859 |
|
|
$1,257,536 |
|
|
$1,312,553 |
|
|
$427,552 |
|
Cost of sales, excluding
interest expense and land charges (1) |
|
|
381,906 |
|
|
|
361,303 |
|
|
|
1,034,953 |
|
|
|
1,076,132 |
|
|
|
355,477 |
|
Homebuilding gross margin,
before cost of sales interest expense and land charges (2) |
|
|
85,943 |
|
|
|
81,556 |
|
|
|
222,583 |
|
|
|
236,421 |
|
|
|
72,075 |
|
Cost of sales interest
expense, excluding land sales interest expense |
|
|
18,824 |
|
|
|
13,424 |
|
|
|
42,964 |
|
|
|
41,025 |
|
|
|
13,898 |
|
Homebuilding gross margin,
after cost of sales interest expense, before land charges (2) |
|
|
67,119 |
|
|
|
68,132 |
|
|
|
179,619 |
|
|
|
195,396 |
|
|
|
58,177 |
|
Land charges |
|
|
1,435 |
|
|
|
96 |
|
|
|
3,601 |
|
|
|
3,183 |
|
|
|
1,462 |
|
Homebuilding gross margin |
|
$65,684 |
|
|
$68,036 |
|
|
$176,018 |
|
|
$192,213 |
|
|
$56,715 |
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin percentage |
|
|
14.0 |
% |
|
|
15.4 |
% |
|
|
14.0 |
% |
|
|
14.6 |
% |
|
|
13.3 |
% |
Gross margin percentage,
before cost of sales interest expense and land charges (2) |
|
|
18.4 |
% |
|
|
18.4 |
% |
|
|
17.7 |
% |
|
|
18.0 |
% |
|
|
16.9 |
% |
Gross margin percentage, after
cost of sales interest expense, before land charges (2) |
|
|
14.3 |
% |
|
|
15.4 |
% |
|
|
14.3 |
% |
|
|
14.9 |
% |
|
|
13.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land Sales Gross Margin |
|
Land Sales Gross Margin |
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
|
|
July 31, |
|
July 31, |
|
|
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
|
|
Land and lot sales |
|
$542 |
|
|
|
$- |
|
|
$8,050 |
|
|
$20,505 |
|
|
|
Land and lot cost of sales,
excluding interest and land charges (1) |
|
|
33 |
|
|
|
- |
|
|
|
7,390 |
|
|
|
7,710 |
|
|
|
Land and lot sales gross
margin, excluding interest and land charges |
|
|
509 |
|
|
|
- |
|
|
|
660 |
|
|
|
12,795 |
|
|
|
Land and lot sales
interest |
|
|
205 |
|
|
|
- |
|
|
|
205 |
|
|
|
4,055 |
|
|
|
Land and lot sales gross
margin, including interest and excluding land charges |
|
$304 |
|
|
|
$- |
|
|
$455 |
|
|
$8,740 |
|
|
|
|
|
|
|
(1) 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. |
(2)
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. |
(3) Second
quarter gross margin reconciliation included because it is
referenced in the “Comments from Management” section of the press
release. |
Hovnanian
Enterprises, Inc. |
July 31,
2019 |
Reconciliation of
adjusted EBITDA to net (loss) |
(In
thousands) |
|
Three Months Ended |
|
Nine Months Ended |
|
July 31, |
|
July 31, |
|
|
|
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Net (loss) |
$(7,601 |
) |
|
$(1,026 |
) |
|
$(40,310 |
) |
|
$(41,658 |
) |
Income tax provision |
|
537 |
|
|
|
1,104 |
|
|
|
1,228 |
|
|
|
1,687 |
|
Interest expense |
|
41,406 |
|
|
|
38,283 |
|
|
|
110,482 |
|
|
|
125,158 |
|
EBIT (1) |
|
34,342 |
|
|
|
38,361 |
|
|
|
71,400 |
|
|
|
85,187 |
|
Depreciation and
amortization |
|
1,004 |
|
|
|
811 |
|
|
|
2,942 |
|
|
|
2,320 |
|
EBITDA (2) |
|
35,346 |
|
|
|
39,172 |
|
|
|
74,342 |
|
|
|
87,507 |
|
Inventory impairment loss and
land option write-offs |
|
1,435 |
|
|
|
96 |
|
|
|
3,601 |
|
|
|
3,183 |
|
Loss on extinguishment of
debt |
|
- |
|
|
|
4,266 |
|
|
|
- |
|
|
|
5,706 |
|
Adjusted EBITDA (3) |
$36,781 |
|
|
$43,534 |
|
|
$77,943 |
|
|
$96,396 |
|
|
|
|
|
|
|
|
|
Interest incurred |
$42,104 |
|
|
$40,438 |
|
|
$122,340 |
|
|
$121,617 |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA to interest
incurred |
|
0.87 |
|
|
|
1.08 |
|
|
|
0.64 |
|
|
|
0.79 |
|
|
|
|
(1) 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. |
(2) 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. |
(3)
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 on extinguishment of debt. |
|
|
Hovnanian
Enterprises, Inc. |
July 31,
2019 |
Interest
incurred, expensed and capitalized |
(In
thousands) |
|
Three Months Ended |
|
Nine Months Ended |
|
July 31, |
|
July 31, |
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Interest capitalized at
beginning of period |
$79,277 |
|
|
$65,355 |
|
|
$68,117 |
|
|
$71,051 |
|
Plus interest incurred |
|
42,104 |
|
|
|
40,438 |
|
|
|
122,340 |
|
|
|
121,617 |
|
Less interest expensed |
|
41,406 |
|
|
|
38,283 |
|
|
|
110,482 |
|
|
|
125,158 |
|
Less interest contributed to
unconsolidated joint venture (1) |
|
1,978 |
|
|
|
- |
|
|
|
1,978 |
|
|
|
- |
|
Interest capitalized at end of
period (2) |
$77,997 |
|
|
$67,510 |
|
|
$77,997 |
|
|
$67,510 |
|
|
(1) Represents
capitalized interest which was included as part of the assets
contributed to the joint venture the company entered into in June
2019. There was no impact to the Condensed Consolidated Statement
of Operations as a result of this transaction. |
(2) Capitalized
interest amounts are shown gross before allocating any portion of
impairments to capitalized interest. |
|
|
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED
BALANCE SHEETS(In Thousands) |
|
|
|
|
|
July 31,2019 |
|
|
October 31,2018 |
|
|
|
(Unaudited) |
|
|
|
(1) |
|
ASSETS |
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$83,634 |
|
|
$187,871 |
|
Restricted cash and cash equivalents |
|
|
16,919 |
|
|
|
12,808 |
|
Inventories: |
|
|
|
|
|
|
Sold and unsold homes and lots under development |
|
|
1,106,100 |
|
|
|
878,876 |
|
Land and land options held for future development or sale |
|
|
69,176 |
|
|
|
111,368 |
|
Consolidated inventory not owned |
|
|
179,642 |
|
|
|
87,921 |
|
Total inventories |
|
|
1,354,918 |
|
|
|
1,078,165 |
|
Investments in and advances to unconsolidated joint ventures |
|
|
134,111 |
|
|
|
123,694 |
|
Receivables, deposits and notes, net |
|
|
32,536 |
|
|
|
35,189 |
|
Property, plant and equipment, net |
|
|
20,488 |
|
|
|
20,285 |
|
Prepaid expenses and other assets |
|
|
43,492 |
|
|
|
39,150 |
|
Total homebuilding |
|
|
1,686,098 |
|
|
|
1,497,162 |
|
|
|
|
|
|
|
|
Financial services |
|
|
109,164 |
|
|
|
164,880 |
|
Total assets |
|
$1,795,262 |
|
|
$1,662,042 |
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
Nonrecourse mortgages secured by inventory, net of debt issuance
costs |
|
$207,172 |
|
|
$95,557 |
|
Accounts payable and other liabilities |
|
|
324,984 |
|
|
|
304,899 |
|
Customers’ deposits |
|
|
40,358 |
|
|
|
30,086 |
|
Liabilities from inventory not owned, net of debt issuance
costs |
|
|
138,441 |
|
|
|
63,387 |
|
Revolving and term loan credit facilities, net of debt issuance
costs |
|
|
201,493 |
|
|
|
201,389 |
|
Notes payable (net of discount, premium and debt issuance costs)
and accrued interest |
|
|
1,284,624 |
|
|
|
1,273,446 |
|
Total homebuilding |
|
|
2,197,072 |
|
|
|
1,968,764 |
|
|
|
|
|
|
|
|
Financial services |
|
|
89,740 |
|
|
|
143,448 |
|
Income taxes payable |
|
|
1,521 |
|
|
|
3,334 |
|
Total liabilities |
|
|
2,288,333 |
|
|
|
2,115,546 |
|
|
|
|
|
|
|
|
Equity:Hovnanian Enterprises,
Inc. stockholders’ equity deficit: |
|
|
|
|
|
|
Preferred stock, $0.01 par value - authorized 100,000 shares;
issued and outstanding 5,600 shares with a liquidation preference
of $140,000 at July 31, 2019 and at October 31, 2018 |
|
|
135,299 |
|
|
|
135,299 |
|
Common stock, Class A, $0.01 par value - authorized 16,000,000
shares; issued 5,792,858 shares at July 31, 2019 and 5,783,858
shares at October 31, 2018 |
|
|
58 |
|
|
|
58 |
|
Common stock, Class B, $0.01 par value (convertible to Class A at
time of sale) - authorized 2,400,000 shares; issued 650,449 shares
at July 31, 2019 and 649,673 shares at October 31, 2018 |
|
|
6 |
|
|
|
6 |
|
Paid in capital - common stock |
|
|
710,517 |
|
|
|
710,349 |
|
Accumulated deficit |
|
|
(1,224,166 |
) |
|
|
(1,183,856 |
) |
Treasury stock - at cost – 470,430 shares of Class A common
stock and 27,669 shares of Class B common stock at July 31,
2019 and October 31, 2018 |
|
|
(115,360 |
) |
|
|
(115,360 |
) |
Total Hovnanian Enterprises, Inc. stockholders’ equity deficit |
|
|
(493,646 |
) |
|
|
(453,504 |
) |
Noncontrolling interest in
consolidated joint ventures |
|
|
575 |
|
|
|
- |
|
Total equity deficit |
|
|
(493,071 |
) |
|
|
(453,504 |
) |
Total liabilities and
equity |
|
$1,795,262 |
|
|
$1,662,042 |
|
- Derived from the audited balance sheet as of October 31,
2018
|
|
HOVNANIAN ENTERPRISES, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS(In Thousands Except Per Share
Data)(Unaudited) |
|
|
|
|
|
Three Months Ended July 31, |
|
|
Nine Months Ended July 31, |
|
|
|
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
|
|
|
|
Sale of homes |
|
$467,849 |
|
|
$442,859 |
|
|
$1,257,536 |
|
|
$1,312,553 |
|
Land sales and other revenues |
|
|
1,428 |
|
|
|
844 |
|
|
|
11,111 |
|
|
|
26,918 |
|
Total homebuilding |
|
|
469,277 |
|
|
|
443,703 |
|
|
|
1,268,647 |
|
|
|
1,339,471 |
|
Financial services |
|
|
12,764 |
|
|
|
13,009 |
|
|
|
34,679 |
|
|
|
36,951 |
|
Total revenues |
|
|
482,041 |
|
|
|
456,712 |
|
|
|
1,303,326 |
|
|
|
1,376,422 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales, excluding interest |
|
|
381,939 |
|
|
|
361,303 |
|
|
|
1,042,343 |
|
|
|
1,083,842 |
|
Cost of sales interest |
|
|
19,029 |
|
|
|
13,424 |
|
|
|
43,169 |
|
|
|
45,080 |
|
Inventory impairment loss and land option write-offs |
|
|
1,435 |
|
|
|
96 |
|
|
|
3,601 |
|
|
|
3,183 |
|
Total cost of sales |
|
|
402,403 |
|
|
|
374,823 |
|
|
|
1,089,113 |
|
|
|
1,132,105 |
|
Selling, general and administrative |
|
|
43,559 |
|
|
|
37,544 |
|
|
|
130,474 |
|
|
|
126,319 |
|
Total homebuilding expenses |
|
|
445,962 |
|
|
|
412,367 |
|
|
|
1,219,587 |
|
|
|
1,258,424 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial services |
|
|
8,927 |
|
|
|
8,986 |
|
|
|
26,079 |
|
|
|
26,125 |
|
Corporate general and administrative |
|
|
14,959 |
|
|
|
16,393 |
|
|
|
48,792 |
|
|
|
51,672 |
|
Other interest |
|
|
22,377 |
|
|
|
24,859 |
|
|
|
67,313 |
|
|
|
80,078 |
|
Other operations |
|
|
622 |
|
|
|
495 |
|
|
|
1,193 |
|
|
|
1,287 |
|
Total expenses |
|
|
492,847 |
|
|
|
463,100 |
|
|
|
1,362,964 |
|
|
|
1,417,586 |
|
Loss on extinguishment of
debt |
|
|
- |
|
|
|
(4,266 |
) |
|
|
- |
|
|
|
(5,706 |
) |
Income from unconsolidated
joint ventures |
|
|
3,742 |
|
|
|
10,732 |
|
|
|
20,556 |
|
|
|
6,899 |
|
(Loss) income before income
taxes |
|
|
(7,064 |
) |
|
|
78 |
|
|
|
(39,082 |
) |
|
|
(39,971 |
) |
State and federal income tax
provision: |
|
|
|
|
|
|
|
|
|
|
|
|
State |
|
|
537 |
|
|
|
1,104 |
|
|
|
1,228 |
|
|
|
1,687 |
|
Federal |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Total income taxes |
|
|
537 |
|
|
|
1,104 |
|
|
|
1,228 |
|
|
|
1,687 |
|
Net (loss) |
|
$(7,601 |
) |
|
$(1,026 |
) |
|
$(40,310 |
) |
|
$(41,658 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share data: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic and assuming
dilution: |
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) per common share |
|
$(1.27 |
) |
|
$(0.18 |
) |
|
$(6.76 |
) |
|
$(7.03 |
) |
Weighted-average number of common shares outstanding |
|
|
5,971 |
|
|
|
5,947 |
|
|
|
5,964 |
|
|
|
5,935 |
|
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA EXCLUDES UNCONSOLIDATED JOINT VENTURES) |
(UNAUDITED) |
|
|
|
|
|
Three Months - July 31, 2019 |
|
|
|
|
|
Contracts (1)Three Months
Ended |
Deliveries |
Contract |
|
|
Three Months Ended |
Backlog |
|
|
July 31, |
July 31, |
July 31, |
|
|
|
2019 |
|
2018 |
% Change |
|
2019 |
|
2018 |
% Change |
|
2019 |
|
2018 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(NJ, PA) |
Home |
|
65 |
|
32 |
103.1 |
% |
|
35 |
|
47 |
(25.5 |
)% |
|
192 |
|
68 |
182.4 |
% |
|
Dollars |
$37,560 |
$18,045 |
108.1 |
% |
$20,694 |
$26,701 |
(22.5 |
)% |
$119,347 |
$40,058 |
197.9 |
% |
|
Avg.
Price |
$577,846 |
$563,909 |
2.5 |
% |
$591,257 |
$568,106 |
4.1 |
% |
$621,599 |
$589,089 |
5.5 |
% |
Mid-Atlantic (3) |
|
|
|
|
|
|
|
|
|
|
(DE, MD, VA, WV) |
Home |
|
197 |
|
144 |
36.8 |
% |
|
159 |
|
144 |
10.4 |
% |
|
402 |
|
324 |
24.1 |
% |
|
Dollars |
$99,807 |
$76,324 |
30.8 |
% |
$86,811 |
$79,593 |
9.1 |
% |
$242,958 |
$196,011 |
24.0 |
% |
|
Avg.
Price |
$506,635 |
$530,032 |
(4.4 |
)% |
$545,981 |
$552,726 |
(1.2 |
)% |
$604,373 |
$604,973 |
(0.1 |
)% |
Midwest |
|
|
|
|
|
|
|
|
|
|
(IL, OH) |
Home |
|
197 |
|
143 |
37.8 |
% |
|
158 |
|
157 |
0.6 |
% |
|
505 |
|
470 |
7.4 |
% |
|
Dollars |
$58,794 |
$43,596 |
34.9 |
% |
$47,261 |
$45,579 |
3.7 |
% |
$136,713 |
$130,377 |
4.9 |
% |
|
Avg.
Price |
$298,442 |
$304,865 |
(2.1 |
)% |
$299,120 |
$290,313 |
3.0 |
% |
$270,719 |
$277,397 |
(2.4 |
)% |
Southeast |
|
|
|
|
|
|
|
|
|
|
(FL, GA, SC) |
Home |
|
147 |
|
175 |
(16.0 |
)% |
|
121 |
|
121 |
0.0 |
% |
|
296 |
|
330 |
(10.3 |
)% |
|
Dollars |
$58,648 |
$71,381 |
(17.8 |
)% |
|
50,217 |
|
47,472 |
5.8 |
% |
$128,571 |
$139,840 |
(8.1 |
)% |
|
Avg.
Price |
$398,966 |
$407,894 |
(2.2 |
)% |
$415,017 |
$392,330 |
5.8 |
% |
$434,361 |
$423,757 |
2.5 |
% |
Southwest |
|
|
|
|
|
|
|
|
|
|
(AZ, TX) |
Home |
|
589 |
|
518 |
13.7 |
% |
|
449 |
|
469 |
(4.3 |
)% |
|
788 |
|
706 |
11.6 |
% |
|
Dollars |
$202,553 |
$177,174 |
14.3 |
% |
$152,615 |
$157,406 |
(3.0 |
)% |
$277,263 |
$250,369 |
10.7 |
% |
|
Avg.
Price |
$343,893 |
$342,036 |
0.5 |
% |
$339,900 |
$335,620 |
1.3 |
% |
$351,857 |
$354,630 |
(0.8 |
)% |
West |
|
|
|
|
|
|
|
|
|
|
(CA) |
Home |
|
320 |
|
224 |
42.9 |
% |
|
263 |
|
204 |
28.9 |
% |
|
372 |
|
389 |
(4.4 |
)% |
|
Dollars |
$131,483 |
$102,183 |
28.7 |
% |
$110,251 |
$86,108 |
28.0 |
% |
$149,654 |
$189,868 |
(21.2 |
)% |
|
Avg.
Price |
$410,884 |
$456,173 |
(9.9 |
)% |
$419,205 |
$422,099 |
(0.7 |
)% |
$402,296 |
$488,094 |
(17.6 |
)% |
Consolidated Total (3) |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
1,515 |
|
1,236 |
22.6 |
% |
|
1,185 |
|
1,142 |
3.8 |
% |
|
2,555 |
|
2,287 |
11.7 |
% |
|
Dollars |
$588,845 |
$488,703 |
20.5 |
% |
$467,849 |
$442,859 |
5.6 |
% |
$1,054,506 |
$946,523 |
11.4 |
% |
|
Avg.
Price |
$388,676 |
$395,392 |
(1.7 |
)% |
$394,809 |
$387,793 |
1.8 |
% |
$412,723 |
$413,871 |
(0.3 |
)% |
Unconsolidated Joint Ventures (2) (4) |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
175 |
|
213 |
(17.8 |
)% |
|
192 |
|
285 |
(32.6 |
)% |
|
357 |
|
543 |
(34.3 |
)% |
|
Dollars |
$107,579 |
$126,887 |
(15.2 |
)% |
$119,704 |
$191,481 |
(37.5 |
)% |
$226,778 |
$366,777 |
(38.2 |
)% |
|
Avg.
Price |
$614,737 |
$595,714 |
3.2 |
% |
$623,458 |
$671,863 |
(7.2 |
)% |
$635,232 |
$675,464 |
(6.0 |
)% |
Grand Total |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
1,690 |
|
1,449 |
16.6 |
% |
|
1,377 |
|
1,427 |
(3.5 |
)% |
|
2,912 |
|
2,830 |
2.9 |
% |
|
Dollars |
$696,424 |
$615,590 |
13.1 |
% |
$587,553 |
$634,340 |
(7.4 |
)% |
$1,281,284 |
$1,313,300 |
(2.4 |
)% |
|
Avg.
Price |
$412,085 |
$424,838 |
(3.0 |
)% |
$426,691 |
$444,527 |
(4.0 |
)% |
$440,001 |
$464,064 |
(5.2 |
)% |
|
|
|
|
|
|
|
|
|
|
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
97 |
|
2 |
4,750.0 |
% |
|
3 |
|
11 |
(72.7 |
)% |
|
131 |
|
12 |
991.7 |
% |
|
Dollars |
$15,346 |
$308 |
4,882.5 |
% |
$719 |
$2,315 |
(68.9 |
)% |
$20,800 |
$3,336 |
523.5 |
% |
|
Avg.
Price |
$158,205 |
$154,000 |
2.7 |
% |
$239,667 |
$210,455 |
13.9 |
% |
$158,777 |
$278,000 |
(42.9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
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”.(3) Contract
backlog as of July 31, 2019 excludes 29 homes that were sold to one
of our joint ventures at the time of the joint venture
formation.(4) Contract backlog as of July 31, 2019 includes 29
homes that were sold to one of our joint ventures at the time of
the joint venture formation. |
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA EXCLUDES UNCONSOLIDATED JOINT VENTURES) |
(UNAUDITED) |
|
|
|
|
|
Nine Months - July 31, 2019 |
|
|
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Nine Months Ended |
Nine Months Ended |
Backlog |
|
|
July 31, |
July 31, |
July 31, |
|
|
|
2019 |
|
2018 |
% Change |
|
2019 |
|
2018 |
% Change |
|
2019 |
|
2018 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(NJ, PA) |
Home |
|
221 |
|
104 |
112.5 |
% |
|
80 |
|
134 |
(40.3 |
)% |
|
192 |
|
68 |
182.4 |
% |
|
Dollars |
$135,090 |
$58,686 |
130.2 |
% |
$46,239 |
$70,406 |
(34.3 |
)% |
$119,347 |
$40,058 |
197.9 |
% |
|
Avg.
Price |
$611,267 |
$564,290 |
8.3 |
% |
$577,988 |
$525,421 |
10.0 |
% |
$621,599 |
$589,089 |
5.5 |
% |
Mid-Atlantic (3) |
|
|
|
|
|
|
|
|
|
|
(DE, MD, VA, WV) |
Home |
|
547 |
|
481 |
13.7 |
% |
|
412 |
|
485 |
(15.1 |
)% |
|
402 |
|
324 |
24.1 |
% |
|
Dollars |
$299,566 |
$256,936 |
16.6 |
% |
$220,808 |
$254,660 |
(13.3 |
)% |
$242,958 |
$196,011 |
24.0 |
% |
|
Avg.
Price |
$547,653 |
$534,170 |
2.5 |
% |
$535,942 |
$525,071 |
2.1 |
% |
$604,373 |
$604,973 |
(0.1 |
)% |
Midwest |
|
|
|
|
|
|
|
|
|
|
(IL, OH) |
Home |
|
559 |
|
528 |
5.9 |
% |
|
448 |
|
440 |
1.8 |
% |
|
505 |
|
470 |
7.4 |
% |
|
Dollars |
$164,584 |
$160,320 |
2.7 |
% |
$135,020 |
$128,912 |
4.7 |
% |
$136,713 |
$130,377 |
4.9 |
% |
|
Avg.
Price |
$294,426 |
$303,636 |
(3.0 |
)% |
$301,384 |
$292,982 |
2.9 |
% |
$270,719 |
$277,397 |
(2.4 |
)% |
Southeast |
|
|
|
|
|
|
|
|
|
|
(FL, GA, SC) |
Home |
|
397 |
|
456 |
(12.9 |
)% |
|
352 |
|
411 |
(14.4 |
)% |
|
296 |
|
330 |
(10.3 |
)% |
|
Dollars |
$163,880 |
$184,577 |
(11.2 |
)% |
$143,446 |
$165,120 |
(13.1 |
)% |
$128,571 |
$139,840 |
(8.1 |
)% |
|
Avg.
Price |
$412,796 |
$404,774 |
2.0 |
% |
$407,517 |
$401,751 |
1.4 |
% |
$434,361 |
$423,757 |
2.5 |
% |
Southwest |
|
|
|
|
|
|
|
|
|
|
(AZ, TX) |
Home |
|
1,510 |
|
1,516 |
(0.4 |
)% |
|
1,245 |
|
1,319 |
(5.6 |
)% |
|
788 |
|
706 |
11.6 |
% |
|
Dollars |
$510,521 |
$517,119 |
(1.3 |
)% |
$414,112 |
$444,568 |
(6.9 |
)% |
$277,263 |
$250,369 |
10.7 |
% |
|
Avg.
Price |
$338,093 |
$341,108 |
(0.9 |
)% |
$332,620 |
$337,049 |
(1.3 |
)% |
$351,857 |
$354,630 |
(0.8 |
)% |
West |
|
|
|
|
|
|
|
|
|
|
(CA) |
Home |
|
761 |
|
582 |
30.8 |
% |
|
700 |
|
593 |
18.0 |
% |
|
372 |
|
389 |
(4.4 |
)% |
|
Dollars |
$309,117 |
$264,793 |
16.7 |
% |
$297,911 |
$248,887 |
19.7 |
% |
$149,654 |
$189,868 |
(21.2 |
)% |
|
Avg.
Price |
$406,198 |
$454,970 |
(10.7 |
)% |
$425,587 |
$419,708 |
1.4 |
% |
$402,296 |
$488,094 |
(17.6 |
)% |
Consolidated Total (3) |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
3,995 |
|
3,667 |
8.9 |
% |
|
3,237 |
|
3,382 |
(4.3 |
)% |
|
2,555 |
|
2,287 |
11.7 |
% |
|
Dollars |
$1,582,758 |
$1,442,431 |
9.7 |
% |
$1,257,536 |
$1,312,553 |
(4.2 |
)% |
$1,054,506 |
$946,523 |
11.4 |
% |
|
Avg.
Price |
$396,185 |
$393,354 |
0.7 |
% |
$388,488 |
$388,100 |
0.1 |
% |
$412,723 |
$413,871 |
(0.3 |
)% |
Unconsolidated Joint Ventures (2) (4) |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
502 |
|
701 |
(28.4 |
)% |
|
535 |
|
558 |
(4.1 |
)% |
|
357 |
|
543 |
(34.3 |
)% |
|
Dollars |
$318,350 |
$436,478 |
(27.1 |
)% |
$338,599 |
$335,828 |
0.8 |
% |
$226,778 |
$366,777 |
(38.2 |
)% |
|
Avg.
Price |
$634,163 |
$622,650 |
1.8 |
% |
$632,895 |
$601,842 |
5.2 |
% |
$635,232 |
$675,464 |
(6.0 |
)% |
Grand Total |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
4,497 |
|
4,368 |
3.0 |
% |
|
3,772 |
|
3,940 |
(4.3 |
)% |
|
2,912 |
|
2,830 |
2.9 |
% |
|
Dollars |
$1,901,108 |
$1,878,909 |
1.2 |
% |
$1,596,135 |
$1,648,381 |
(3.2 |
)% |
$1,281,284 |
$1,313,300 |
(2.4 |
)% |
|
Avg.
Price |
$422,750 |
$430,153 |
(1.7 |
)% |
$423,153 |
$418,371 |
1.1 |
% |
$440,001 |
$464,064 |
(5.2 |
)% |
|
|
|
|
|
|
|
|
|
|
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
133 |
|
39 |
241.0 |
% |
|
7 |
|
62 |
(88.7 |
)% |
|
131 |
|
12 |
991.7 |
% |
|
Dollars |
$21,426 |
$6,911 |
210.0 |
% |
$1,627 |
$12,363 |
(86.8 |
)% |
$20,800 |
$3,336 |
523.5 |
% |
|
Avg.
Price |
$161,101 |
$177,216 |
(9.1 |
)% |
$232,383 |
$199,406 |
16.5 |
% |
$158,777 |
$278,000 |
(42.9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
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”.(3) Contract
backlog as of July 31, 2019 excludes 29 homes that were sold to one
of our joint ventures at the time of the joint venture
formation.(4) Contract backlog as of July 31, 2019 includes 29
homes that were sold to one of our joint ventures at the time of
the joint venture formation. |
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA UNCONSOLIDATED JOINT VENTURES ONLY) |
(UNAUDITED) |
|
|
|
|
|
Three Months - July 31, 2019 |
|
|
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Three Months Ended |
Three Months Ended |
Backlog |
|
|
July 31, |
July 31, |
July 31, |
|
|
|
2019 |
|
2018 |
% Change |
|
2019 |
|
2018 |
% Change |
|
2019 |
|
2018 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
65 |
|
63 |
3.2 |
% |
|
62 |
|
129 |
(51.9 |
)% |
|
111 |
|
215 |
(48.4 |
)% |
(excluding KSA JV) |
Dollars |
$52,932 |
$48,757 |
8.6 |
% |
$49,496 |
$107,574 |
(54.0 |
)% |
$92,909 |
$175,257 |
(47.0 |
)% |
(NJ, PA) |
Avg.
Price |
$814,338 |
$773,921 |
5.2 |
% |
$798,323 |
$833,907 |
(4.3 |
)% |
$837,018 |
$815,149 |
2.7 |
% |
Mid-Atlantic (3) |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
9 |
|
12 |
(25.0 |
)% |
|
19 |
|
17 |
11.8 |
% |
|
36 |
|
47 |
(23.4 |
)% |
(DE, MD, VA, WV) |
Dollars |
$4,490 |
$10,626 |
(57.7 |
)% |
$13,847 |
$13,335 |
3.8 |
% |
$21,075 |
$39,640 |
(46.8 |
)% |
|
Avg.
Price |
$498,889 |
$885,500 |
(43.7 |
)% |
$728,789 |
$784,471 |
(7.1 |
)% |
$585,417 |
$843,404 |
(30.6 |
)% |
Midwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
5 |
|
4 |
25.0 |
% |
|
8 |
|
16 |
(50.0 |
)% |
|
2 |
|
19 |
(89.5 |
)% |
(IL, OH) |
Dollars |
$2,509 |
$2,121 |
18.3 |
% |
$4,487 |
$10,978 |
(59.1 |
)% |
$885 |
$14,556 |
(93.9 |
)% |
|
Avg.
Price |
$501,800 |
$530,000 |
(5.3 |
)% |
$560,875 |
$686,063 |
(18.2 |
)% |
$442,500 |
$766,105 |
(42.2 |
)% |
Southeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
39 |
|
66 |
(40.9 |
)% |
|
46 |
|
38 |
21.1 |
% |
|
117 |
|
123 |
(4.9 |
)% |
(FL, GA, SC) |
Dollars |
$20,919 |
$31,702 |
(34.0 |
)% |
$23,064 |
$15,619 |
47.7 |
% |
$64,147 |
$61,917 |
3.6 |
% |
|
Avg.
Price |
$536,385 |
$480,333 |
11.7 |
% |
$501,391 |
$411,029 |
22.0 |
% |
$548,265 |
$503,394 |
8.9 |
% |
Southwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
24 |
|
38 |
(36.8 |
)% |
|
37 |
|
45 |
(17.8 |
)% |
|
55 |
|
99 |
(44.4 |
)% |
(AZ, TX) |
Dollars |
$15,072 |
$22,656 |
(33.5 |
)% |
$21,841 |
$25,236 |
(13.5 |
)% |
$34,764 |
$60,849 |
(42.9 |
)% |
|
Avg.
Price |
$628,000 |
$596,211 |
5.3 |
% |
$590,297 |
$560,802 |
5.3 |
% |
$632,073 |
$614,637 |
2.8 |
% |
West |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
33 |
|
30 |
10.0 |
% |
|
20 |
|
40 |
(50.0 |
)% |
|
36 |
|
40 |
(10.0 |
)% |
(CA) |
Dollars |
$11,657 |
$11,025 |
5.7 |
% |
$6,969 |
$18,739 |
(62.8 |
)% |
$12,998 |
$14,558 |
(10.7 |
)% |
|
Avg.
Price |
$353,242 |
$367,532 |
(3.9 |
)% |
$348,450 |
$468,475 |
(25.6 |
)% |
$361,056 |
$363,954 |
(0.8 |
)% |
Unconsolidated Joint Ventures (2) (3) |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
175 |
|
213 |
(17.8 |
)% |
|
192 |
|
285 |
(32.6 |
)% |
|
357 |
|
543 |
(34.3 |
)% |
|
Dollars |
$107,579 |
$126,887 |
(15.2 |
)% |
$119,704 |
$191,481 |
(37.5 |
)% |
$226,778 |
$366,777 |
(38.2 |
)% |
|
Avg.
Price |
$614,737 |
$595,714 |
3.2 |
% |
$623,458 |
$671,863 |
(7.2 |
)% |
$635,232 |
$675,464 |
(6.0 |
)% |
|
|
|
|
|
|
|
|
|
|
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
97 |
|
2 |
4,750.0 |
% |
|
3 |
|
11 |
(72.7 |
)% |
|
131 |
|
12 |
991.7 |
% |
|
Dollars |
$15,346 |
$308 |
4,882.5 |
% |
$719 |
$2,315 |
(68.9 |
)% |
$20,800 |
$3,336 |
523.5 |
% |
|
Avg.
Price |
$158,205 |
$154,000 |
2.7 |
% |
$239,667 |
$210,455 |
13.9 |
% |
$158,777 |
$278,000 |
(42.9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
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”.(3) Contract
backlog as of July 31, 2019 includes 29 homes that were sold to one
of our joint ventures at the time of the joint venture
formation. |
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA UNCONSOLIDATED JOINT VENTURES ONLY) |
(UNAUDITED) |
|
|
|
|
|
Nine Months - July 31, 2019 |
|
|
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Nine Months Ended |
Nine Months Ended |
Backlog |
|
|
July 31, |
July 31, |
July 31, |
|
|
|
2019 |
|
2018 |
% Change |
|
2019 |
|
2018 |
% Change |
|
2019 |
|
2018 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
188 |
|
217 |
(13.4 |
)% |
|
191 |
|
184 |
3.8 |
% |
|
111 |
|
215 |
(48.4 |
)% |
(excluding KSA JV) |
Dollars |
$150,396 |
$169,683 |
(11.4 |
)% |
$150,853 |
$142,317 |
6.0 |
% |
$92,909 |
$175,257 |
(47.0 |
)% |
(NJ, PA) |
Avg.
Price |
$799,979 |
$781,949 |
2.3 |
% |
$789,806 |
$773,462 |
2.1 |
% |
$837,018 |
$815,149 |
2.7 |
% |
Mid-Atlantic (3) |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
26 |
|
62 |
(58.1 |
)% |
|
43 |
|
26 |
65.4 |
% |
|
36 |
|
47 |
(23.4 |
)% |
(DE, MD, VA, WV) |
Dollars |
$19,158 |
$50,664 |
(62.2 |
)% |
$33,267 |
$22,133 |
50.3 |
% |
$21,075 |
$39,640 |
(46.8 |
)% |
|
Avg.
Price |
$736,846 |
$817,159 |
(9.8 |
)% |
$773,651 |
$851,272 |
(9.1 |
)% |
$585,417 |
$843,404 |
(30.6 |
)% |
Midwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
12 |
|
28 |
(57.1 |
)% |
|
19 |
|
36 |
(47.2 |
)% |
|
2 |
|
19 |
(89.5 |
)% |
(IL, OH) |
Dollars |
$6,472 |
$19,091 |
(66.1 |
)% |
$11,663 |
$23,253 |
(49.8 |
)% |
$885 |
$14,556 |
(93.9 |
)% |
|
Avg.
Price |
$539,333 |
$681,820 |
(20.9 |
)% |
$613,842 |
$645,916 |
(5.0 |
)% |
$442,500 |
$766,105 |
(42.2 |
)% |
Southeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
122 |
|
163 |
(25.2 |
)% |
|
127 |
|
118 |
7.6 |
% |
|
117 |
|
123 |
(4.9 |
)% |
(FL, GA, SC) |
Dollars |
$65,530 |
$77,408 |
(15.3 |
)% |
$64,638 |
$52,301 |
23.6 |
% |
$64,147 |
$61,917 |
3.6 |
% |
|
Avg.
Price |
$537,131 |
$474,895 |
13.1 |
% |
$508,961 |
$443,229 |
14.8 |
% |
$548,265 |
$503,394 |
8.9 |
% |
Southwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
86 |
|
131 |
(34.4 |
)% |
|
98 |
|
89 |
10.1 |
% |
|
55 |
|
99 |
(44.4 |
)% |
(AZ, TX) |
Dollars |
$52,455 |
$78,003 |
(32.8 |
)% |
$58,155 |
$50,406 |
15.4 |
% |
$34,764 |
$60,849 |
(42.9 |
)% |
|
Avg.
Price |
$609,942 |
$595,445 |
2.4 |
% |
$593,418 |
$566,359 |
4.8 |
% |
$632,073 |
$614,637 |
2.8 |
% |
West |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
68 |
|
100 |
(32.0 |
)% |
|
57 |
|
105 |
(45.7 |
)% |
|
36 |
|
40 |
(10.0 |
)% |
(CA) |
Dollars |
$24,339 |
$41,629 |
(41.5 |
)% |
$20,023 |
$45,418 |
(55.9 |
)% |
$12,998 |
$14,558 |
(10.7 |
)% |
|
Avg.
Price |
$357,926 |
$416,295 |
(14.0 |
)% |
$351,281 |
$432,553 |
(18.8 |
)% |
$361,056 |
$363,954 |
(0.8 |
)% |
Unconsolidated Joint Ventures (2) (3) |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
502 |
|
701 |
(28.4 |
)% |
|
535 |
|
558 |
(4.1 |
)% |
|
357 |
|
543 |
(34.3 |
)% |
|
Dollars |
$318,350 |
$436,478 |
(27.1 |
)% |
$338,599 |
$335,828 |
0.8 |
% |
$226,778 |
$366,777 |
(38.2 |
)% |
|
Avg.
Price |
$634,163 |
$622,650 |
1.8 |
% |
$632,895 |
$601,842 |
5.2 |
% |
$635,232 |
$675,464 |
(6.0 |
)% |
|
|
|
|
|
|
|
|
|
|
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
133 |
|
39 |
241.0 |
% |
|
7 |
|
62 |
(88.7 |
)% |
|
131 |
|
12 |
991.7 |
% |
|
Dollars |
$21,426 |
$6,911 |
210.0 |
% |
$1,627 |
$12,363 |
(86.8 |
)% |
$20,800 |
$3,336 |
523.5 |
% |
|
Avg.
Price |
$161,101 |
$177,216 |
(9.1 |
)% |
$232,383 |
$199,406 |
16.5 |
% |
$158,777 |
$278,000 |
(42.9 |
)% |
|
|
|
|
|
|
|
|
|
|
|
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”.(3) Contract
backlog as of July 31, 2019 includes 29 homes that were sold to one
of our joint ventures at the time of the joint venture
formation. |
|
|
|
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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