Hovnanian Enterprises, Inc. (NYSE: HOV), a leading national
homebuilder, reported results for its fiscal third quarter and nine
months ended July 31, 2023.
RESULTS FOR THE THREE-MONTH AND
NINE-MONTH PERIODS ENDED JULY 31, 2023:
- Total revenues were $650.0 million
(including 1,198 homes) in the third quarter of fiscal 2023,
compared with $767.6 million (including 1,412 homes) in the same
quarter of the prior year. For the nine months ended July 31, 2023,
total revenues were $1.87 billion (including 3,361 homes) compared
with $2.04 billion (including 3,939 homes) in the first nine months
of fiscal 2022.
- Homebuilding gross margin
percentage, after cost of sales interest expense and land charges,
was 20.1% for the three months ended July 31, 2023, compared with
17.8% for the three months ended April 30, 2023, and 23.1% during
the third quarter a year ago. During the first nine months of
fiscal 2023, homebuilding gross margin percentage, after cost of
sales interest expense and land charges, was 18.8% compared with
22.3% in the same period of the prior fiscal year.
- Homebuilding gross margin
percentage, before cost of sales interest expense and land charges,
was 23.2% during the fiscal 2023 third quarter compared with 20.9%
in the fiscal 2023 second quarter and 26.3% in last year’s third
quarter. For the nine months ended July 31, 2023, homebuilding
gross margin percentage, before cost of sales interest expense and
land charges, was 21.9% compared with 25.3% in the first nine
months of the previous fiscal year.
- Total SG&A was $75.1 million,
or 11.6% of total revenues, in the third quarter of fiscal 2023
compared with $74.9 million, or 9.8% of total revenues, in the
previous year’s third quarter. During the first nine months of
fiscal 2023, total SG&A was $224.0 million, or 12.0% of total
revenues, compared with $215.3 million, or 10.6% of total revenues,
in the same period of the prior fiscal year.
- Total interest expense as a percent
of total revenues was 5.0% for the third quarter of fiscal 2023
compared with 4.2% during the third quarter of fiscal 2022. For the
nine months ended July 31, 2023, total interest expense as a
percent of total revenues was 5.3% compared with 4.6% in the same
period of the previous fiscal year.
- Income before income taxes for the
third quarter of fiscal 2023 was $70.4 million compared with $46.1
million in the fiscal 2023 second quarter and $111.9 million in the
third quarter of the prior fiscal year. For the first nine months
of fiscal 2023, income before income taxes was $134.6 million
compared with $228.3 million during the first nine months of the
prior fiscal year.
- Net income was $55.8 million, or
$7.38 per diluted common share, for the three months ended July 31,
2023, compared with net income of $82.6 million, or $10.82 per
diluted common share, in the same period of the previous fiscal
year. For the first nine months of fiscal 2023, net income was
$108.6 million, or $13.97 per diluted common share, compared with
net income of $169.9 million, or $21.77 per diluted common share,
during the same period of fiscal 2022.
- EBITDA was $104.5 million for the
third quarter of fiscal 2023 compared with $86.6 million for the
second quarter of fiscal 2023 and $145.5 million in the third
quarter of the prior year. For the first nine months of fiscal
2023, EBITDA was $240.6 million compared with $325.6 million in the
same period of the prior year.
- Consolidated contracts in the third
quarter of fiscal 2023 increased 80.7% to 1,444 homes ($744.2
million) compared with 799 homes ($467.9 million) in the same
quarter last year. Contracts, including domestic unconsolidated
joint ventures1, for the three months ended July 31, 2023,
increased to 1,600 homes ($854.7 million) compared with 914 homes
($549.5 million) in the third quarter of fiscal 2022.
- As of July 31, 2023, consolidated
community count decreased to 102 communities, compared with 108
communities on July 31, 2022. Community count, including domestic
unconsolidated joint ventures, was 122 as of July 31, 2023,
compared with 124 communities at the end of the previous fiscal
year’s third quarter.
- Consolidated contracts per
community increased 91.9% year-over-year to 14.2 in the third
quarter of fiscal 2023 compared with 7.4 contracts per community
for the third quarter of fiscal 2022. Contracts per community,
including domestic unconsolidated joint ventures, increased 77.0%
to 13.1 in the three months ended July 31, 2023 compared with 7.4
contracts per community in the same quarter one year ago.
- The dollar value of consolidated
contract backlog, as of July 31, 2023, decreased 26.0% to $1.33
billion compared with $1.79 billion as of July 31, 2022. The dollar
value of contract backlog, including domestic unconsolidated joint
ventures, as of July 31, 2023, decreased 20.8% to $1.64 billion
compared with $2.07 billion as of July 31, 2022.
- The gross contract cancellation
rate for consolidated contracts was 16% for the third quarter ended
July 31, 2023 compared with 27% in the fiscal 2022 third quarter.
The gross contract cancellation rate for contracts, including
domestic unconsolidated joint ventures, was 16% for the third
quarter of fiscal 2023 compared with 26% in the third quarter of
the prior year.
(1)When we refer to “Domestic Unconsolidated
Joint Ventures”, we are excluding results from our multi-community
unconsolidated joint venture in the Kingdom of Saudi Arabia
(KSA).
LIQUIDITY AND INVENTORY AS OF JULY 31,
2023:
- During the third quarter of fiscal
2023, land and land development spending was $168.8 million
compared with $204.5 million in the same quarter one year ago. For
the first nine months of fiscal 2023, land and land development
spending was $459.7 million compared with $554.1 million in the
same period one year ago.
- Total liquidity as of July 31, 2023
was $455.5 million, significantly above our targeted liquidity
range of $170 million to $245 million.
- In May of 2023, we redeemed $100 million principal amount of
our 7.75% senior secured notes due February 15, 2026 at a purchase
price of 101.937% plus accrued and unpaid interest.
- In August of 2023, we redeemed an
additional $100 million principal amount of our 7.75% senior
secured notes due February 15, 2026, at a purchase price of
101.937% plus accrued and unpaid interest. We have reduced total
debt by $668 million since the beginning of fiscal 2020.
- In the third quarter of fiscal
2023, approximately 4,100 lots were put under option or acquired in
40 consolidated communities.
- As of July 31, 2023, our total
controlled consolidated lots were 29,487, a decrease compared with
31,913 lots at the end of the third quarter of the previous year
and an increase compared to 28,657 lots on April 30, 2023. Based on
trailing twelve-month deliveries, the current position equaled a
5.9 years’ supply.
FINANCIAL
GUIDANCE(2):
The Company is increasing guidance for total
revenues, adjusted homebuilding gross margin, adjusted EBITDA,
adjusted income before income taxes and fully diluted earnings per
share for fiscal 2023. Financial guidance below assumes no adverse
changes in current market conditions, including further
deterioration in the supply chain, material increase in mortgage
rates, or increased inflation and excludes further impact to
SG&A expenses from phantom stock expense related solely to
stock price movements from the closing price of $106.62 on July 31,
2023.
For fiscal 2023, total revenues are expected to
be between $2.6 billion and $2.7 billion, adjusted homebuilding
gross margin is expected to be between 22% and 23%, adjusted income
before income taxes is expected to be between $215 million and $235
million, adjusted EBITDA is expected to be between $350 million and
$370 million and fully diluted earnings per share is expected to be
between $21 and $24. At the midpoint of our guidance, we anticipate
our common shareholders’ equity to increase by approximately 63% at
October 31, 2023 to approximately $67 per share compared to last
year’s value at year-end of $41 per share.
(2)The Company cannot provide a
reconciliation between its non-GAAP projections and the most
directly comparable GAAP measures without unreasonable efforts
because it is unable to predict with reasonable certainty the
ultimate outcome of certain significant items required for the
reconciliation. These items include, but are not limited to,
land-related charges, inventory impairments and land option
write-offs and loss on extinguishment of debt, net. These items are
uncertain, depend on various factors and could have a material
impact on GAAP reported results.
COMMENTS FROM MANAGEMENT:
“We are pleased with our third quarter operating
performance, adjusted homebuilding gross margin, adjusted EBITDA
and adjusted income before income taxes all exceeded the upper end
of our guidance,” stated Ara K. Hovnanian, Chairman of the Board,
President, and Chief Executive Officer. “Positive demographic and
employment trends combined with a low supply of existing homes for
sale has resulted in strong demand for newly constructed homes.
Despite higher mortgage rates and a challenging affordability
atmosphere, the 92% year-over-year improvement in our consolidated
contracts per community is a testament to the current robust
selling environment, our strong land positions and our exceptional
team. Due to the strength of our recent sales pace and margins, we
are raising the high end of our 2023 EPS guidance by 20%.”
“After ending the third quarter with $456
million of liquidity, we redeemed $100 million of 7.75% senior
secured notes to further reduce our debt. As we move forward, we
intend to continue to utilize excess liquidity to reduce debt and
grow our land position to increase profitability. Given the
strength in the housing market today, we are encouraged that
looking forward we believe our year-over-year comparisons for the
first quarter of fiscal 2024 should show significant improvements,”
concluded Mr. Hovnanian.
SEGMENT
CHANGE/RECLASSIFICATION
Historically, the Company had seven reportable
segments consisting of six homebuilding segments (Northeast,
Mid-Atlantic, Midwest, Southeast, Southwest and West) and its
financial services segment. During the fourth quarter of fiscal
2022, we reevaluated our reportable segments as a result of changes
in the business and our management thereof. In particular, we
considered the fact that, since our segments were last established,
the Company had exited the Minnesota, North Carolina, and Tampa
markets and is currently in the process of exiting the Chicago
market. As a result, we realigned our homebuilding operating
segments and determined that, in addition to our financial services
segment, we now have three reportable homebuilding segments
comprised of (1) Northeast, (2) Southeast and (3) West. All prior
period amounts related to the segment change have been
retrospectively reclassified to conform to the new
presentation.
WEBCAST INFORMATION:
Hovnanian Enterprises will webcast its fiscal
2023 third quarter financial results conference call at 11:00 a.m.
E.T. on Wednesday, August 30, 2023. 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 and West Virginia.
The Company’s homes are marketed and sold under the trade name K.
Hovnanian® Homes. 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. 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 impairments and land
option write-offs and loss on extinguishment of debt, net
(“Adjusted EBITDA”) are not U.S. generally accepted accounting
principles (“GAAP”) financial measures. The most directly
comparable GAAP financial measure is net income. The reconciliation
for historical periods of EBIT, EBITDA and Adjusted EBITDA to net
income 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.
Adjusted income before income taxes,
which is defined as income before income taxes excluding
land-related charges and loss on extinguishment of debt, net is a
non-GAAP financial measure. The most directly comparable GAAP
financial measure is income before income taxes. The reconciliation
for historical periods of adjusted income before income taxes to
income before income taxes is presented in a table attached to this
earnings release.
Total liquidity is comprised of $325.2
million of cash and cash equivalents, $5.3 million of restricted
cash required to collateralize letters of credit and $125.0 million
availability under the senior secured revolving credit facility as
of July 31, 2023.
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 and
statements regarding demand for homes, mortgage rates, inflation,
supply chain issues, customer incentives and underlying factors.
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) shortages in, and price
fluctuations of, raw materials and labor, including due to
geopolitical events, 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; (3) fluctuations in interest rates and
the availability of mortgage financing, including as a result of
bank sector instability; (4) adverse weather and other
environmental conditions and natural disasters; (5) the seasonality
of the Company’s business; (6) the availability and cost of
suitable land and improved lots and sufficient liquidity to invest
in such land and lots; (7) reliance on, and the performance of,
subcontractors; (8) 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; (9) increases in cancellations of agreements
of sale; (10) increases in inflation; (11) changes in tax laws
affecting the after-tax costs of owning a home; (12) legal claims
brought against us and not resolved in our favor, such as product
liability litigation, warranty claims and claims made by mortgage
investors; (13) levels of competition; (14) utility shortages and
outages or rate fluctuations; (15) information technology failures
and data security breaches; (16) negative publicity; (17) high
leverage and restrictions on the Company’s operations and
activities imposed by the agreements governing the Company’s
outstanding indebtedness; (18) availability and terms of financing
to the Company; (19) the Company’s sources of liquidity; (20)
changes in credit ratings; (21) government regulation, including
regulations concerning development of land, the home building,
sales and customer financing processes, tax laws and the
environment; (22) operations through unconsolidated joint ventures
with third parties; (23) significant influence of the Company’s
controlling stockholders; (24) availability of net operating loss
carryforwards; (25) loss of key management personnel or failure to
attract qualified personnel; 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, 2022 and
the Company’s Quarterly Reports on Form 10-Q for the quarterly
periods during fiscal 2023 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.
Hovnanian
Enterprises, Inc. |
July 31,
2023 |
|
|
|
|
|
|
|
Statements of
consolidated operations |
(In thousands,
except per share data) |
|
Three Months Ended |
|
Nine Months Ended |
|
July 31, |
|
July 31, |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
(Unaudited) |
|
|
(Unaudited) |
Total revenues |
$ |
649,957 |
|
|
$ |
767,593 |
|
|
$ |
1,868,984 |
|
|
$ |
2,035,443 |
|
Costs and expenses (1) |
|
583,886 |
|
|
|
668,223 |
|
|
|
1,751,311 |
|
|
|
1,824,294 |
|
Loss on extinguishment of
debt, net |
|
(4,082 |
) |
|
|
- |
|
|
|
(4,082 |
) |
|
|
(6,795 |
) |
Income from unconsolidated
joint ventures |
|
8,401 |
|
|
|
12,557 |
|
|
|
20,969 |
|
|
|
23,919 |
|
Income before income
taxes |
|
70,390 |
|
|
|
111,927 |
|
|
|
134,560 |
|
|
|
228,273 |
|
Income tax provision |
|
14,626 |
|
|
|
29,313 |
|
|
|
25,934 |
|
|
|
58,416 |
|
Net income |
|
55,764 |
|
|
|
82,614 |
|
|
|
108,626 |
|
|
|
169,857 |
|
Less: preferred stock
dividends |
|
2,669 |
|
|
|
2,669 |
|
|
|
8,007 |
|
|
|
8,007 |
|
Net income available to common
stockholders |
$ |
53,095 |
|
|
$ |
79,945 |
|
|
$ |
100,619 |
|
|
$ |
161,850 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share
data: |
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common share |
$ |
7.92 |
|
|
$ |
10.92 |
|
|
$ |
14.97 |
|
|
|
22.05 |
|
Weighted average number of common shares outstanding |
|
6,249 |
|
|
|
6,485 |
|
|
|
6,201 |
|
|
|
6,424 |
|
Assuming
dilution: |
|
|
Net income per common share |
$ |
7.38 |
|
|
$ |
10.82 |
|
|
$ |
13.97 |
|
|
$ |
21.77 |
|
Weighted average number of common shares outstanding |
|
6,705 |
|
|
|
6,544 |
|
|
|
6,642 |
|
|
|
6,507 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes
inventory impairments and land option write-offs. |
|
|
|
|
|
|
|
|
|
|
|
|
|
Hovnanian
Enterprises, Inc. |
July 31,
2023 |
|
|
|
|
|
|
|
|
|
Reconciliation of
income before income taxes excluding land-related charges and loss
on extinguishment of debt, net to income before income taxes |
(In
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
July 31, |
|
July 31, |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
(Unaudited) |
|
(Unaudited) |
Income before income
taxes |
$ |
70,390 |
|
|
$ |
111,927 |
|
|
$ |
134,560 |
|
|
$ |
228,273 |
|
Inventory impairments and land
option write-offs |
|
308 |
|
|
|
1,173 |
|
|
|
922 |
|
|
|
1,837 |
|
Loss on extinguishment of
debt, net |
|
4,082 |
|
|
|
- |
|
|
|
4,082 |
|
|
|
6,795 |
|
Income before income taxes
excluding land-related charges and loss on extinguishment of debt,
net (1) |
$ |
74,780 |
|
|
$ |
113,100 |
|
|
$ |
139,564 |
|
|
$ |
236,905 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Income before
income taxes excluding land-related charges and loss on
extinguishment of debt, net is a non-GAAP financial measure. The
most directly comparable GAAP financial measure is income before
income taxes. |
|
Hovnanian Enterprises,
Inc. |
|
|
|
|
|
|
|
|
|
|
|
|
July 31,
2023 |
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin |
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding Gross Margin |
|
Homebuilding Gross Margin |
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
July 31, |
|
July 31, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
|
(Unaudited) |
|
(Unaudited) |
Sale of homes |
|
$ |
630,371 |
|
|
$ |
736,654 |
|
|
$ |
1,800,724 |
|
|
$ |
1,973,843 |
|
Cost of sales, excluding
interest expense and land charges (1) |
|
|
483,990 |
|
|
|
543,064 |
|
|
|
1,405,712 |
|
|
|
1,474,403 |
|
Homebuilding gross margin,
before cost of sales interest expense and land charges (2) |
|
|
146,381 |
|
|
|
193,590 |
|
|
|
395,012 |
|
|
|
499,440 |
|
Cost of sales interest
expense, excluding land sales interest expense |
|
|
19,271 |
|
|
|
22,453 |
|
|
|
54,793 |
|
|
|
57,855 |
|
Homebuilding gross margin,
after cost of sales interest expense, before land charges (2) |
|
|
127,110 |
|
|
|
171,137 |
|
|
|
340,219 |
|
|
|
441,585 |
|
Land charges |
|
|
308 |
|
|
|
1,173 |
|
|
|
922 |
|
|
|
1,837 |
|
Homebuilding gross margin |
|
$ |
126,802 |
|
|
$ |
169,964 |
|
|
$ |
339,297 |
|
|
$ |
439,748 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding gross margin
percentage |
|
|
20.1 |
% |
|
|
23.1 |
% |
|
|
18.8 |
% |
|
|
22.3 |
% |
Homebuilding gross margin
percentage, before cost of sales interest expense and land charges
(2) |
|
|
23.2 |
% |
|
|
26.3 |
% |
|
|
21.9 |
% |
|
|
25.3 |
% |
Homebuilding gross margin
percentage, after cost of sales interest expense, before land
charges (2) |
|
|
20.2 |
% |
|
|
23.2 |
% |
|
|
18.9 |
% |
|
|
22.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Land Sales Gross Margin |
|
Land Sales Gross Margin |
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
July 31, |
|
July 31, |
|
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
|
(Unaudited) |
|
(Unaudited) |
Land and lot sales |
|
$ |
429 |
|
|
$ |
15,788 |
|
|
$ |
16,042 |
|
|
$ |
16,187 |
|
Cost of sales, excluding
interest (1) |
|
|
- |
|
|
|
5,512 |
|
|
|
9,940 |
|
|
|
5,772 |
|
Land and lot sales gross
margin, excluding interest and land charges |
|
|
429 |
|
|
|
10,276 |
|
|
|
6,102 |
|
|
|
10,415 |
|
Land and lot sales interest
expense |
|
|
1 |
|
|
|
- |
|
|
|
926 |
|
|
|
21 |
|
Land and lot sales gross
margin, including interest |
|
$ |
428 |
|
|
$ |
10,276 |
|
|
$ |
5,176 |
|
|
$ |
10,394 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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. |
|
Hovnanian Enterprises,
Inc. |
|
|
|
|
|
|
|
|
|
|
|
July 31,
2023 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of adjusted
EBITDA to net income |
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
July 31, |
|
July 31, |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
(Unaudited) |
|
(Unaudited) |
Net income |
$ |
55,764 |
|
|
$ |
82,614 |
|
|
$ |
108,626 |
|
|
$ |
169,857 |
|
Income tax provision |
|
14,626 |
|
|
|
29,313 |
|
|
|
25,934 |
|
|
|
58,416 |
|
Interest expense |
|
32,774 |
|
|
|
32,077 |
|
|
|
98,815 |
|
|
|
93,318 |
|
EBIT (1) |
|
103,164 |
|
|
|
144,004 |
|
|
|
233,375 |
|
|
|
321,591 |
|
Depreciation and
amortization |
|
1,299 |
|
|
|
1,520 |
|
|
|
7,223 |
|
|
|
4,009 |
|
EBITDA (2) |
|
104,463 |
|
|
|
145,524 |
|
|
|
240,598 |
|
|
|
325,600 |
|
Inventory impairments and land
option write-offs |
|
308 |
|
|
|
1,173 |
|
|
|
922 |
|
|
|
1,837 |
|
Loss on extinguishment of
debt, net |
|
4,082 |
|
|
|
- |
|
|
|
4,082 |
|
|
|
6,795 |
|
Adjusted EBITDA (3) |
$ |
108,853 |
|
|
$ |
146,697 |
|
|
$ |
245,602 |
|
|
$ |
334,232 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest incurred |
$ |
34,214 |
|
|
$ |
32,644 |
|
|
$ |
103,662 |
|
|
$ |
99,299 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA to interest
incurred |
|
3.18 |
|
|
|
4.49 |
|
|
|
2.37 |
|
|
|
3.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) EBIT is a
non-GAAP financial measure. The most directly comparable GAAP
financial measure is net income. 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 income. 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 income. Adjusted EBITDA
represents earnings before interest expense, income taxes,
depreciation, amortization and inventory impairments and land
option write-offs and loss on extinguishment of debt, net. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hovnanian Enterprises,
Inc. |
|
|
|
|
|
|
|
|
|
|
|
July 31,
2023 |
|
|
|
|
|
|
|
|
|
|
|
Interest incurred, expensed
and capitalized |
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
July 31, |
|
July 31, |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
|
(Unaudited) |
|
(Unaudited) |
Interest capitalized at
beginning of period |
$ |
60,274 |
|
|
$ |
63,573 |
|
|
$ |
59,600 |
|
|
$ |
58,159 |
|
Plus: interest incurred |
|
34,214 |
|
|
|
32,644 |
|
|
|
103,662 |
|
|
|
99,299 |
|
Less: interest expensed |
|
(32,774 |
) |
|
|
(32,077 |
) |
|
|
(98,815 |
) |
|
|
(93,318 |
) |
Less: interest contributed to
unconsolidated joint venture (1) |
|
(6,440 |
) |
|
|
- |
|
|
|
(9,456 |
) |
|
|
- |
|
Plus: interest acquired from
unconsolidated joint venture (2) |
|
- |
|
|
|
- |
|
|
|
283 |
|
|
|
- |
|
Interest capitalized at end of
period (3) |
$ |
55,274 |
|
|
$ |
64,140 |
|
|
$ |
55,274 |
|
|
$ |
64,140 |
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Represents
capitalized interest which was included as part of the assets
contributed to joint ventures the company entered into during the
nine months ended July 31, 2023. There was no impact to the
Condensed Consolidated Statement of Operations as a result of these
transactions. |
|
(2) Represents
capitalized interest which was included as part of the assets
purchased from a joint venture the company closed out during the
nine months ended July 31, 2023. There was no impact to the
Condensed Consolidated Statement of Operations as a result of this
transaction. |
|
(3) 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, except per share
data)(Unaudited) |
|
|
|
|
|
|
|
|
|
|
July 31, |
|
|
October 31, |
|
|
|
2023 |
|
|
2022 |
|
|
|
(Unaudited) |
|
|
(1) |
ASSETS |
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
325,182 |
|
|
$ |
326,198 |
|
Restricted cash and cash equivalents |
|
|
8,623 |
|
|
|
13,382 |
|
Inventories: |
|
|
|
|
|
|
Sold and unsold homes and lots under development |
|
|
1,049,802 |
|
|
|
1,058,183 |
|
Land and land options held for future development or sale |
|
|
110,343 |
|
|
|
152,406 |
|
Consolidated inventory not owned |
|
|
251,115 |
|
|
|
308,595 |
|
Total inventories |
|
|
1,411,260 |
|
|
|
1,519,184 |
|
Investments in and advances to unconsolidated joint ventures |
|
|
85,260 |
|
|
|
74,940 |
|
Receivables, deposits and notes, net |
|
|
33,016 |
|
|
|
37,837 |
|
Property and equipment, net |
|
|
31,330 |
|
|
|
25,819 |
|
Prepaid expenses and other assets |
|
|
58,945 |
|
|
|
63,884 |
|
Total homebuilding |
|
|
1,953,616 |
|
|
|
2,061,244 |
|
|
|
|
|
|
|
|
Financial services |
|
|
115,603 |
|
|
|
155,993 |
|
|
|
|
|
|
|
|
Deferred tax assets, net |
|
|
324,698 |
|
|
|
344,793 |
|
Total assets |
|
$ |
2,393,917 |
|
|
$ |
2,562,030 |
|
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
Nonrecourse mortgages secured by inventory, net of debt issuance
costs |
|
$ |
129,127 |
|
|
$ |
144,805 |
|
Accounts payable and other liabilities |
|
|
381,761 |
|
|
|
439,952 |
|
Customers’ deposits |
|
|
63,907 |
|
|
|
74,020 |
|
Liabilities from inventory not owned, net of debt issuance
costs |
|
|
145,979 |
|
|
|
202,492 |
|
Senior notes and credit facilities (net of discounts, premiums and
debt issuance costs) |
|
|
1,044,779 |
|
|
|
1,146,547 |
|
Accrued interest |
|
|
50,913 |
|
|
|
32,415 |
|
Total homebuilding |
|
|
1,816,466 |
|
|
|
2,040,231 |
|
|
|
|
|
|
|
|
Financial services |
|
|
94,502 |
|
|
|
135,581 |
|
|
|
|
|
|
|
|
Income taxes payable |
|
|
434 |
|
|
|
3,167 |
|
Total liabilities |
|
|
1,911,402 |
|
|
|
2,178,979 |
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
|
|
Hovnanian Enterprises, Inc.
stockholders' equity: |
|
|
|
|
|
|
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, 2023 and October 31, 2022 |
|
135,299 |
|
|
|
135,299 |
|
Common stock, Class A, $0.01 par value - authorized 16,000,000
shares; issued 6,247,047 shares at July 31, 2023 and 6,159,886
shares at October 31, 2022 |
|
62 |
|
|
|
62 |
|
Common stock, Class B, $0.01 par value (convertible to Class A at
time of sale) - authorized 2,400,000 shares; issued 776,750 shares
at July 31, 2023 and 733,374 shares at October 31, 2022 |
|
8 |
|
|
|
7 |
|
Paid in capital - common stock |
|
|
731,285 |
|
|
|
727,663 |
|
Accumulated deficit |
|
|
(251,794 |
) |
|
|
(352,413 |
) |
Treasury stock - at cost – 901,379 shares of Class A common stock
at July 31, 2023 and 782,901 shares at October 31, 2022; 27,669
shares of Class B common stock at July 31, 2023 and October 31,
2022 |
|
(132,382 |
) |
|
|
(127,582 |
) |
Total Hovnanian Enterprises, Inc. stockholders’ equity |
|
|
482,478 |
|
|
|
383,036 |
|
Noncontrolling interest in
consolidated joint ventures |
|
|
37 |
|
|
|
15 |
|
Total equity |
|
|
482,515 |
|
|
|
383,051 |
|
Total liabilities and
equity |
|
$ |
2,393,917 |
|
|
$ |
2,562,030 |
|
|
|
|
|
|
|
|
(1) Derived from the audited
balance sheet as of October 31, 2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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, |
|
2023 |
|
2022 |
|
2023 |
|
2022 |
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
|
|
|
|
Sale of homes |
$ |
630,371 |
|
|
$ |
736,654 |
|
|
$ |
1,800,724 |
|
|
$ |
1,973,843 |
|
Land sales and other revenues |
|
4,937 |
|
|
|
16,406 |
|
|
|
27,244 |
|
|
|
18,052 |
|
Total homebuilding |
|
635,308 |
|
|
|
753,060 |
|
|
|
1,827,968 |
|
|
|
1,991,895 |
|
Financial services |
|
14,649 |
|
|
|
14,533 |
|
|
|
41,016 |
|
|
|
43,548 |
|
Total revenues |
|
649,957 |
|
|
|
767,593 |
|
|
|
1,868,984 |
|
|
|
2,035,443 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales, excluding interest |
|
483,990 |
|
|
|
548,576 |
|
|
|
1,415,652 |
|
|
|
1,480,175 |
|
Cost of sales interest |
|
19,272 |
|
|
|
22,453 |
|
|
|
55,719 |
|
|
|
57,876 |
|
Inventory impairments and land option write-offs |
|
308 |
|
|
|
1,173 |
|
|
|
922 |
|
|
|
1,837 |
|
Total cost of sales |
|
503,570 |
|
|
|
572,202 |
|
|
|
1,472,293 |
|
|
|
1,539,888 |
|
Selling, general and administrative |
|
47,716 |
|
|
|
50,163 |
|
|
|
146,090 |
|
|
|
139,410 |
|
Total homebuilding expenses |
|
551,286 |
|
|
|
622,365 |
|
|
|
1,618,383 |
|
|
|
1,679,298 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial services |
|
10,345 |
|
|
|
10,790 |
|
|
|
29,550 |
|
|
|
31,982 |
|
Corporate general and administrative |
|
27,365 |
|
|
|
24,774 |
|
|
|
77,934 |
|
|
|
75,893 |
|
Other interest |
|
13,502 |
|
|
|
9,624 |
|
|
|
43,096 |
|
|
|
35,442 |
|
Other (income) expense, net (1) |
|
(18,612 |
) |
|
|
670 |
|
|
|
(17,652 |
) |
|
|
1,679 |
|
Total expenses |
|
583,886 |
|
|
|
668,223 |
|
|
|
1,751,311 |
|
|
|
1,824,294 |
|
Loss on extinguishment of
debt, net |
|
(4,082 |
) |
|
|
- |
|
|
|
(4,082 |
) |
|
|
(6,795 |
) |
Income from unconsolidated
joint ventures |
|
8,401 |
|
|
|
12,557 |
|
|
|
20,969 |
|
|
|
23,919 |
|
Income before income
taxes |
|
70,390 |
|
|
|
111,927 |
|
|
|
134,560 |
|
|
|
228,273 |
|
State and federal income tax
provision: |
|
|
|
|
|
|
|
|
|
|
|
|
State |
|
(500 |
) |
|
|
6,385 |
|
|
|
2,794 |
|
|
|
11,515 |
|
Federal |
|
15,126 |
|
|
|
22,928 |
|
|
|
23,140 |
|
|
|
46,901 |
|
Total income taxes |
|
14,626 |
|
|
|
29,313 |
|
|
|
25,934 |
|
|
|
58,416 |
|
Net income |
|
55,764 |
|
|
|
82,614 |
|
|
|
108,626 |
|
|
|
169,857 |
|
Less: preferred stock
dividends |
|
2,669 |
|
|
|
2,669 |
|
|
|
8,007 |
|
|
|
8,007 |
|
Net income available to common
stockholders |
$ |
53,095 |
|
|
$ |
79,945 |
|
|
$ |
100,619 |
|
|
$ |
161,850 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share
data: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common share |
$ |
7.92 |
|
|
$ |
10.92 |
|
|
$ |
14.97 |
|
|
$ |
22.05 |
|
Weighted-average number of common shares outstanding |
|
6,249 |
|
|
|
6,485 |
|
|
|
6,201 |
|
|
|
6,424 |
|
Assuming dilution: |
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common share |
$ |
7.38 |
|
|
$ |
10.82 |
|
|
$ |
13.97 |
|
|
$ |
21.77 |
|
Weighted-average number of
common shares outstanding |
|
6,705 |
|
|
|
6,544 |
|
|
|
6,642 |
|
|
|
6,507 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes gain
on consolidation of a joint venture of $19.1 million for the three
and nine months ended July 31, 2023. |
|
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA EXCLUDES UNCONSOLIDATED
JOINT VENTURES) |
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Three Months Ended |
Three Months Ended |
Backlog |
|
|
July 31, |
July 31, |
July 31, |
|
|
2023 |
2022 |
% Change |
2023 |
2022 |
% Change |
2023 |
2022 |
% Change |
Northeast (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(DE, IL, MD, NJ, OH, VA, WV) |
Home |
|
366 |
|
265 |
38.1% |
|
357 |
|
495 |
(27.9)% |
|
794 |
|
1,236 |
(35.8)% |
|
Dollars |
$ |
239,425 |
$ |
168,208 |
42.3% |
$ |
200,812 |
$ |
289,717 |
(30.7)% |
$ |
478,477 |
$ |
681,617 |
(29.8)% |
|
Avg. Price |
$ |
654,167 |
$ |
634,747 |
3.1% |
$ |
562,499 |
$ |
585,287 |
(3.9)% |
$ |
602,616 |
$ |
551,470 |
9.3% |
Southeast (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(FL, GA, SC) |
Home |
|
373 |
|
114 |
227.2% |
|
230 |
|
148 |
55.4% |
|
710 |
|
574 |
23.7% |
|
Dollars |
$ |
155,655 |
$ |
67,402 |
130.9% |
$ |
121,073 |
$ |
71,484 |
69.4% |
$ |
353,023 |
$ |
348,019 |
1.4% |
|
Avg. Price |
$ |
417,306 |
$ |
591,246 |
(29.4)% |
$ |
526,404 |
$ |
483,000 |
9.0% |
$ |
497,215 |
$ |
606,305 |
(18.0)% |
West (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(AZ, CA, TX) |
Home |
|
705 |
|
420 |
67.9% |
|
611 |
|
769 |
(20.5)% |
|
899 |
|
1,373 |
(34.5)% |
|
Dollars |
$ |
349,145 |
$ |
232,329 |
50.3% |
$ |
308,486 |
$ |
375,453 |
(17.8)% |
$ |
494,758 |
$ |
761,974 |
(35.1)% |
|
Avg. Price |
$ |
495,241 |
$ |
553,164 |
(10.5)% |
$ |
504,887 |
$ |
488,235 |
3.4% |
$ |
550,343 |
$ |
554,970 |
(0.8)% |
Consolidated Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home |
|
1,444 |
|
799 |
80.7% |
|
1,198 |
|
1,412 |
(15.2)% |
|
2,403 |
|
3,183 |
(24.5)% |
|
Dollars |
$ |
744,225 |
$ |
467,939 |
59.0% |
$ |
630,371 |
$ |
736,654 |
(14.4)% |
$ |
1,326,258 |
$ |
1,791,610 |
(26.0)% |
|
Avg. Price |
$ |
515,391 |
$ |
585,656 |
(12.0)% |
$ |
526,186 |
$ |
521,710 |
0.9% |
$ |
551,918 |
$ |
562,868 |
(1.9)% |
Unconsolidated Joint Ventures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Excluding KSA JV) (2) (3) |
Home |
|
156 |
|
115 |
35.7% |
|
171 |
|
121 |
41.3% |
|
441 |
|
390 |
13.1% |
|
Dollars |
$ |
110,439 |
$ |
81,605 |
35.3% |
$ |
120,984 |
$ |
78,390 |
54.3% |
$ |
315,371 |
$ |
281,220 |
12.1% |
|
Avg. Price |
$ |
707,942 |
$ |
709,609 |
(0.2)% |
$ |
707,509 |
$ |
647,851 |
9.2% |
$ |
715,127 |
$ |
721,077 |
(0.8)% |
Grand Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home |
|
1,600 |
|
914 |
75.1% |
|
1,369 |
|
1,533 |
(10.7)% |
|
2,844 |
|
3,573 |
(20.4)% |
|
Dollars |
$ |
854,664 |
$ |
549,543 |
55.5% |
$ |
751,355 |
$ |
815,044 |
(7.8)% |
$ |
1,641,629 |
$ |
2,072,830 |
(20.8)% |
|
Avg. Price |
$ |
534,165 |
$ |
601,251 |
(11.2)% |
$ |
548,835 |
$ |
531,666 |
3.2% |
$ |
577,225 |
$ |
580,137 |
(0.5)% |
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home |
|
2 |
|
18 |
(88.9)% |
|
0 |
|
0 |
0.0% |
|
2,225 |
|
2,209 |
0.7% |
|
Dollars |
$ |
319 |
$ |
2,788 |
(88.6)% |
$ |
0 |
$ |
0 |
0.0% |
$ |
349,295 |
$ |
346,814 |
0.7% |
|
Avg. Price |
$ |
159,500 |
$ |
154,889 |
3.0% |
$ |
0 |
$ |
0 |
0.0% |
$ |
156,987 |
$ |
157,000 |
(0.0)% |
|
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) Reflects the
reclassification of 90 homes and $73.7 million, 59 homes and $33.0
million, and 12 homes and $5.7 million of contract backlog from the
consolidated Northeast, Southeast and West segments, respectively,
to unconsolidated joint ventures as of July 31, 2023. This is
related to the assets and liabilities contributed to a joint
venture by the company during the three months ended July 31,
2023.(3) 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 from unconsolidated joint
ventures”. |
|
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA EXCLUDES UNCONSOLIDATED
JOINT VENTURES) |
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Nine Months Ended |
Nine Months Ended |
Backlog |
|
|
July 31, |
July 31, |
July 31, |
|
|
2023 |
2022 |
% Change |
2023 |
2022 |
% Change |
2023 |
2022 |
% Change |
Northeast (2) (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(DE, IL, MD, NJ, OH, VA, WV) |
Home |
|
1,090 |
|
1,228 |
(11.2)% |
|
1,086 |
|
1,277 |
(15.0)% |
|
794 |
|
1,236 |
(35.8)% |
|
Dollars |
$ |
685,595 |
$ |
711,424 |
(3.6)% |
$ |
623,221 |
$ |
704,838 |
(11.6)% |
$ |
478,477 |
$ |
681,617 |
(29.8)% |
|
Avg. Price |
$ |
628,986 |
$ |
579,336 |
8.6% |
$ |
573,868 |
$ |
551,948 |
4.0% |
$ |
602,616 |
$ |
551,470 |
9.3% |
Southeast (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(FL, GA, SC) |
Home |
|
812 |
|
555 |
46.3% |
|
545 |
|
402 |
35.6% |
|
710 |
|
574 |
23.7% |
|
Dollars |
$ |
370,800 |
$ |
326,727 |
13.5% |
$ |
295,714 |
$ |
200,133 |
47.8% |
$ |
353,023 |
$ |
348,019 |
1.4% |
|
Avg. Price |
$ |
456,650 |
$ |
588,697 |
(22.4)% |
$ |
542,594 |
$ |
497,843 |
9.0% |
$ |
497,215 |
$ |
606,305 |
(18.0)% |
West (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(AZ, CA, TX) |
Home |
|
1,807 |
|
2,092 |
(13.6)% |
|
1,730 |
|
2,260 |
(23.5)% |
|
899 |
|
1,373 |
(34.5)% |
|
Dollars |
$ |
888,650 |
$ |
1,088,595 |
(18.4)% |
$ |
881,789 |
$ |
1,068,872 |
(17.5)% |
$ |
494,758 |
$ |
761,974 |
(35.1)% |
|
Avg. Price |
$ |
491,782 |
$ |
520,361 |
(5.5)% |
$ |
509,705 |
$ |
472,952 |
7.8% |
$ |
550,343 |
$ |
554,970 |
(0.8)% |
Consolidated Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home |
|
3,709 |
|
3,875 |
(4.3)% |
|
3,361 |
|
3,939 |
(14.7)% |
|
2,403 |
|
3,183 |
(24.5)% |
|
Dollars |
$ |
1,945,045 |
$ |
2,126,746 |
(8.5)% |
$ |
1,800,724 |
$ |
1,973,843 |
(8.8)% |
$ |
1,326,258 |
$ |
1,791,610 |
(26.0)% |
|
Avg. Price |
$ |
524,412 |
$ |
548,838 |
(4.5)% |
$ |
535,770 |
$ |
501,103 |
6.9% |
$ |
551,918 |
$ |
562,868 |
(1.9)% |
Unconsolidated Joint Ventures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Excluding KSA JV) (2) (3) (4) |
Home |
|
398 |
|
387 |
2.8% |
|
399 |
|
372 |
7.3% |
|
441 |
|
390 |
13.1% |
|
Dollars |
$ |
273,183 |
$ |
268,585 |
1.7% |
$ |
280,331 |
$ |
228,984 |
22.4% |
$ |
315,371 |
$ |
281,220 |
12.1% |
|
Avg. Price |
$ |
686,389 |
$ |
694,018 |
(1.1)% |
$ |
702,584 |
$ |
615,548 |
14.1% |
$ |
715,127 |
$ |
721,077 |
(0.8)% |
Grand Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home |
|
4,107 |
|
4,262 |
(3.6)% |
|
3,760 |
|
4,311 |
(12.8)% |
|
2,844 |
|
3,573 |
(20.4)% |
|
Dollars |
$ |
2,218,228 |
$ |
2,395,331 |
(7.4)% |
$ |
2,081,055 |
$ |
2,202,827 |
(5.5)% |
$ |
1,641,629 |
$ |
2,072,830 |
(20.8)% |
|
Avg. Price |
$ |
540,109 |
$ |
562,020 |
(3.9)% |
$ |
553,472 |
$ |
510,978 |
8.3% |
$ |
577,225 |
$ |
580,137 |
(0.5)% |
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home |
|
12 |
|
296 |
(95.9)% |
|
0 |
|
0 |
0.0% |
|
2,225 |
|
2,209 |
0.7% |
|
Dollars |
$ |
1,875 |
$ |
46,430 |
(96.0)% |
$ |
0 |
$ |
0 |
0.0% |
$ |
349,295 |
$ |
346,814 |
0.7% |
|
Avg. Price |
$ |
156,250 |
$ |
156,858 |
(0.4)% |
$ |
0 |
$ |
0 |
0.0% |
$ |
156,987 |
$ |
157,000 |
(0.0)% |
|
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) Reflects the
reclassification of 38 homes and $32.3 million of contract backlog
as of April 30, 2023 from the unconsolidated joint ventures to the
consolidated Northeast segment. This is related to the assets and
liabilities acquired from a joint venture the company closed out
during the three months ended April 30, 2023. |
(3) Reflects the
reclassification of 90 homes and $73.7 million, 59 homes and $33.0
million, and 12 homes and $5.7 million of contract backlog from the
consolidated Northeast, Southeast and West segments, respectively,
to unconsolidated joint ventures as of July 31, 2023. This is
related to the assets and liabilities contributed to a joint
venture by the company during the three months ended July 31,
2023.(4) 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 from unconsolidated joint
ventures”. |
|
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA UNCONSOLIDATED JOINT VENTURES ONLY) |
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Three Months Ended |
Three Months Ended |
Backlog |
|
|
July 31, |
July 31, |
July 31, |
|
|
2023 |
2022 |
% Change |
2023 |
2022 |
% Change |
2023 |
2022 |
% Change |
Northeast (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unconsolidated Joint Ventures) |
Home |
|
74 |
|
56 |
32.1% |
|
81 |
|
51 |
58.8% |
|
198 |
|
186 |
6.5% |
(Excluding KSA JV) |
Dollars |
$ |
57,053 |
$ |
41,361 |
37.9% |
$ |
58,907 |
$ |
33,457 |
76.1% |
$ |
154,791 |
$ |
134,030 |
15.5% |
(DE, IL, MD, NJ, OH, VA, WV) |
Avg. Price |
$ |
770,986 |
$ |
738,589 |
4.4% |
$ |
727,247 |
$ |
656,020 |
10.9% |
$ |
781,773 |
$ |
720,591 |
8.5% |
Southeast (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unconsolidated Joint Ventures) |
Home |
|
58 |
|
42 |
38.1% |
|
68 |
|
49 |
38.8% |
|
210 |
|
165 |
27.3% |
(FL, GA, SC) |
Dollars |
$ |
40,296 |
$ |
30,481 |
32.2% |
$ |
50,407 |
$ |
33,860 |
48.9% |
$ |
142,742 |
$ |
126,714 |
12.6% |
|
Avg. Price |
$ |
694,759 |
$ |
725,738 |
(4.3)% |
$ |
741,279 |
$ |
691,020 |
7.3% |
$ |
679,724 |
$ |
767,964 |
(11.5)% |
West (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unconsolidated Joint Ventures) |
Home |
|
24 |
|
17 |
41.2% |
|
22 |
|
21 |
4.8% |
|
33 |
|
39 |
(15.4)% |
(AZ, CA, TX) |
Dollars |
$ |
13,090 |
$ |
9,763 |
34.1% |
$ |
11,670 |
$ |
11,073 |
5.4% |
$ |
17,837 |
$ |
20,477 |
(12.9)% |
|
Avg. Price |
$ |
545,417 |
$ |
574,294 |
(5.0)% |
$ |
530,455 |
$ |
527,286 |
0.6% |
$ |
540,515 |
$ |
525,051 |
2.9% |
Unconsolidated Joint Ventures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Excluding KSA JV) (2) (3) |
Home |
|
156 |
|
115 |
35.7% |
|
171 |
|
121 |
41.3% |
|
441 |
|
390 |
13.1% |
|
Dollars |
$ |
110,439 |
$ |
81,605 |
35.3% |
$ |
120,984 |
$ |
78,390 |
54.3% |
$ |
315,370 |
$ |
281,221 |
12.1% |
|
Avg. Price |
$ |
707,942 |
$ |
709,609 |
(0.2)% |
$ |
707,509 |
$ |
647,851 |
9.2% |
$ |
715,125 |
$ |
721,079 |
(0.8)% |
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home |
|
2 |
|
18 |
(88.9)% |
|
0 |
|
0 |
0.0% |
|
2,225 |
|
2,209 |
0.7% |
|
Dollars |
$ |
319 |
$ |
2,788 |
(88.6)% |
$ |
0 |
$ |
0 |
0.0% |
$ |
349,295 |
$ |
346,814 |
0.7% |
|
Avg. Price |
$ |
159,500 |
$ |
154,889 |
3.0% |
$ |
0 |
$ |
0 |
0.0% |
$ |
156,987 |
$ |
157,000 |
(0.0)% |
|
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) Reflects the
reclassification of 90 homes and $73.7 million, 59 homes and $33.0
million, and 12 homes and $5.7 million of contract backlog from the
consolidated Northeast, Southeast and West segments, respectively,
to unconsolidated joint ventures as of July 31, 2023. This is
related to the assets and liabilities contributed to a joint
venture by the company during the three months ended July 31,
2023.(3) 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 from unconsolidated joint
ventures”. |
|
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA UNCONSOLIDATED JOINT VENTURES ONLY) |
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Nine Months Ended |
Nine Months Ended |
Backlog |
|
|
July 31, |
July 31, |
July 31, |
|
|
2023 |
2022 |
% Change |
2023 |
2022 |
% Change |
2023 |
2022 |
% Change |
Northeast (2) (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unconsolidated Joint Ventures) |
Home |
|
173 |
|
188 |
(8.0)% |
|
207 |
|
128 |
61.7% |
|
198 |
|
186 |
6.5% |
(Excluding KSA JV) |
Dollars |
$ |
132,974 |
$ |
135,063 |
(1.5)% |
$ |
151,256 |
$ |
87,831 |
72.2% |
$ |
154,791 |
$ |
134,030 |
15.5% |
(DE, IL, MD, NJ, OH, VA, WV) |
Avg. Price |
$ |
768,636 |
$ |
718,420 |
7.0% |
$ |
730,705 |
$ |
686,180 |
6.5% |
$ |
781,773 |
$ |
720,591 |
8.5% |
Southeast (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unconsolidated Joint Ventures) |
Home |
|
170 |
|
129 |
31.8% |
|
148 |
|
175 |
(15.4)% |
|
210 |
|
165 |
27.3% |
(FL, GA, SC) |
Dollars |
$ |
110,016 |
$ |
97,107 |
13.3% |
$ |
105,654 |
$ |
108,164 |
(2.3)% |
$ |
142,742 |
$ |
126,714 |
12.6% |
|
Avg. Price |
$ |
647,153 |
$ |
752,767 |
(14.0)% |
$ |
713,878 |
$ |
618,080 |
15.5% |
$ |
679,724 |
$ |
767,964 |
(11.5)% |
West (3) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unconsolidated Joint Ventures) |
Home |
|
55 |
|
70 |
(21.4)% |
|
44 |
|
69 |
(36.2)% |
|
33 |
|
39 |
(15.4)% |
(AZ, CA, TX) |
Dollars |
$ |
30,193 |
$ |
36,416 |
(17.1)% |
$ |
23,421 |
$ |
32,989 |
(29.0)% |
$ |
17,837 |
$ |
20,477 |
(12.9)% |
|
Avg. Price |
$ |
548,964 |
$ |
520,229 |
5.5% |
$ |
532,295 |
$ |
478,101 |
11.3% |
$ |
540,515 |
$ |
525,051 |
2.9% |
Unconsolidated Joint Ventures |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Excluding KSA JV) (2) (3) (4) |
Home |
|
398 |
|
387 |
2.8% |
|
399 |
|
372 |
7.3% |
|
441 |
|
390 |
13.1% |
|
Dollars |
$ |
273,183 |
$ |
268,586 |
1.7% |
$ |
280,331 |
$ |
228,984 |
22.4% |
$ |
315,370 |
$ |
281,221 |
12.1% |
|
Avg. Price |
$ |
686,389 |
$ |
694,021 |
(1.1)% |
$ |
702,584 |
$ |
615,548 |
14.1% |
$ |
715,125 |
$ |
721,079 |
(0.8)% |
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Home |
|
12 |
|
296 |
(95.9)% |
|
0 |
|
0 |
0.0% |
|
2,225 |
|
2,209 |
0.7% |
|
Dollars |
$ |
1,875 |
$ |
46,430 |
(96.0)% |
$ |
0 |
$ |
0 |
0.0% |
$ |
349,295 |
$ |
346,814 |
0.7% |
|
Avg. Price |
$ |
156,250 |
$ |
156,858 |
(0.4)% |
$ |
0 |
$ |
0 |
0.0% |
$ |
156,987 |
$ |
157,000 |
(0.0)% |
|
DELIVERIES INCLUDE EXTRAS |
(1) Contracts are
defined as new contracts signed during the period for the purchase
of homes, less cancellations of prior contracts. |
(2) Reflects the
reclassification of 38 homes and $32.3 million of contract backlog
as of April 30, 2023 from the unconsolidated joint ventures to the
consolidated Northeast segment. This is related to the assets and
liabilities acquired from a joint venture the company closed out
during the three months ended April 30, 2023. |
(3) Reflects the
reclassification of 90 homes and $73.7 million, 59 homes and $33.0
million, and 12 homes and $5.7 million of contract backlog from the
consolidated Northeast, Southeast and West segments, respectively,
to unconsolidated joint ventures as of July 31, 2023. This is
related to the assets and liabilities contributed to a joint
venture by the company during the three months ended July 31,
2023.(4) 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 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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