RESTON, Va., July 19, 2019 /PRNewswire/ -- NVR, Inc.
(NYSE: NVR), one of the nation's largest homebuilding and
mortgage banking companies, announced net income for its second
quarter ended June 30, 2019 of $210,209,000, or $53.09 per diluted share. Net income and
diluted earnings per share for the second quarter ended
June 30, 2019 increased 3% and 8%, respectively, when compared
to 2018 second quarter net income of $203,174,000, or $49.05 per diluted share. Consolidated
revenues for the second quarter of 2019 totaled $1,800,194,000, a 1% increase from $1,787,305,000 in the second quarter of 2018.
For the six months ended June 30, 2019, consolidated
revenues were $3,487,205,000, a 5%
increase from $3,316,719,000 reported
for 2018. Net income for the six months ended June 30,
2019 was $398,615,000, an increase of
8% when compared to the six months ended June 30, 2018.
Diluted earnings per share for the six months ended June 30,
2019 was $100.61, an increase of 14%
from $88.31 per diluted share for
2018.
Homebuilding
New orders in the second quarter of 2019 increased by 6% to
5,239 units, when compared to 4,964 units in the second quarter of
2018. The average sales price of new orders in the second quarter
of 2019 was $358,600, a decrease of
5% when compared with the second quarter of 2018. The
decrease in the average sales price is primarily due to a continued
shift to smaller, lower priced products, as well as a shift to
markets with lower average sales prices. Settlements
increased in the second quarter of 2019 to 4,720 units, which was
2% higher than the second quarter of 2018. The Company's
backlog of homes sold but not settled as of June 30, 2019
decreased on a unit basis by 6% to 9,530 units and decreased on a
dollar basis by 9% to $3,516,505,000
when compared to June 30, 2018.
Homebuilding revenues of $1,757,448,000 in the second quarter of 2019 were
relatively flat compared to the second quarter of 2018. Gross
profit margin in the second quarter of 2019 decreased to 18.9%,
compared to 19.1% in the second quarter of 2018. Income
before tax from the homebuilding segment totaled $219,650,000 in the second quarter of 2019, a
decrease of 2% when compared to the second quarter of 2018.
Mortgage Banking
Mortgage closed loan production in the second quarter of 2019
totaled $1,231,039,000, an increase
of 1% when compared to the second quarter of 2018. Income
before tax from the mortgage banking segment totaled $25,062,000 in the second quarter of 2019, an
increase of 37% when compared to $18,320,000 in the second quarter of 2018.
The increase in income before tax is primarily due to a 16%
increase in mortgage banking fees, resulting from an increase in
secondary marketing gains and the timing of loan sales.
About NVR
NVR, Inc. operates in two business segments: homebuilding
and mortgage banking. The homebuilding segment sells and
builds homes under the Ryan Homes, NVHomes and Heartland Homes
trade names, and operates in thirty-two metropolitan areas in
fourteen states and Washington,
D.C. For more information about NVR, Inc. and its brands, see
www.nvrinc.com, www.ryanhomes.com, www.nvhomes.com and
www.heartlandluxuryhomes.com.
Some of the statements in this release made by the Company
constitute "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995, Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Certain, but not
necessarily all, of such forward-looking statements can be
identified by the use of forward-looking terminology, such as
"believes," "expects," "may," "will," "should" or "anticipates" or
the negative thereof or other comparable terminology. All
statements other than of historical facts are forward-looking
statements. Forward-looking statements contained in this
document may include those regarding market trends, NVR's financial
position, business strategy, the outcome of pending litigation,
investigations or similar contingencies, projected plans and
objectives of management for future operations. Such
forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause the actual results
or performance of NVR to be materially different from future
results, performance or achievements expressed or implied by the
forward-looking statements. Such risk factors include, but
are not limited to the following: general economic and business
conditions (on both a national and regional level); interest rate
changes; access to suitable financing by NVR and NVR's customers;
increased regulation in the mortgage banking industry; the ability
of our mortgage banking subsidiary to sell loans it originates into
the secondary market; competition; the availability and cost of
land and other raw materials used by NVR in its homebuilding
operations; shortages of labor; weather related slow-downs;
building moratoriums; governmental regulation; fluctuation and
volatility of stock and other financial markets; mortgage financing
availability; and other factors over which NVR has little or no
control. NVR undertakes no obligation to update such
forward-looking statements except as required by law.
NVR,
Inc.
|
Consolidated
Statements of Income
|
(in thousands, except
per share data)
|
(Unaudited)
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
|
|
|
|
|
|
|
|
Homebuilding:
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
|
1,757,448
|
|
$
|
1,750,463
|
|
$
|
3,400,654
|
|
$
|
3,240,556
|
Other
income
|
|
5,833
|
|
2,164
|
|
11,570
|
|
4,141
|
Cost of
sales
|
|
(1,425,388)
|
|
(1,416,797)
|
|
(2,764,194)
|
|
(2,628,743)
|
Selling, general and
administrative
|
|
(112,210)
|
|
(106,517)
|
|
(227,944)
|
|
(212,064)
|
Operating
income
|
|
225,683
|
|
229,313
|
|
420,086
|
|
403,890
|
Interest
expense
|
|
(6,033)
|
|
(6,047)
|
|
(12,026)
|
|
(12,054)
|
Homebuilding
income
|
|
219,650
|
|
223,266
|
|
408,060
|
|
391,836
|
|
|
|
|
|
|
|
|
|
Mortgage
Banking:
|
|
|
|
|
|
|
|
|
Mortgage banking
fees
|
|
42,746
|
|
36,842
|
|
86,551
|
|
76,163
|
Interest
income
|
|
2,737
|
|
2,915
|
|
5,570
|
|
5,008
|
Other
income
|
|
681
|
|
641
|
|
1,220
|
|
1,165
|
General and
administrative
|
|
(20,834)
|
|
(21,796)
|
|
(37,592)
|
|
(41,031)
|
Interest
expense
|
|
(268)
|
|
(282)
|
|
(490)
|
|
(557)
|
Mortgage banking
income
|
|
25,062
|
|
18,320
|
|
55,259
|
|
40,748
|
|
|
|
|
|
|
|
|
|
Income before
taxes
|
|
244,712
|
|
241,586
|
|
463,319
|
|
432,584
|
Income tax
expense
|
|
(34,503)
|
|
(38,412)
|
|
(64,704)
|
|
(63,361)
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
|
210,209
|
|
$
|
203,174
|
|
$
|
398,615
|
|
$
|
369,223
|
|
|
|
|
|
|
|
|
|
Basic earnings
per share
|
|
$
|
58.20
|
|
$
|
55.90
|
|
$
|
110.43
|
|
$
|
101.03
|
|
|
|
|
|
|
|
|
|
Diluted
earnings per share
|
|
$
|
53.09
|
|
$
|
49.05
|
|
$
|
100.61
|
|
$
|
88.31
|
|
|
|
|
|
|
|
|
|
Basic weighted
average shares outstanding
|
|
3,612
|
|
3,635
|
|
3,610
|
|
3,655
|
|
|
|
|
|
|
|
|
|
Diluted
weighted average shares outstanding
|
|
3,959
|
|
4,142
|
|
3,962
|
|
4,181
|
NVR,
Inc.
|
|
Consolidated Balance
Sheets
|
|
(in thousands, except
share and per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
June 30,
2019
|
|
December 31,
2018
|
|
ASSETS
|
|
|
|
|
|
Homebuilding:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
860,956
|
|
$
|
688,783
|
|
Restricted
cash
|
|
20,403
|
|
16,982
|
|
Receivables
|
|
28,943
|
|
18,641
|
|
Inventory:
|
|
|
|
|
|
Lots and housing
units, covered under sales agreements with customers
|
|
1,199,015
|
|
1,076,904
|
|
Unsold lots and
housing units
|
|
132,667
|
|
115,631
|
|
Land under
development
|
|
46,725
|
|
38,857
|
|
Building materials
and other
|
|
19,321
|
|
21,718
|
|
|
|
1,397,728
|
|
1,253,110
|
|
|
|
|
|
|
|
Contract land
deposits, net
|
|
409,754
|
|
396,177
|
|
Property, plant and
equipment, net
|
|
48,279
|
|
42,234
|
|
Operating lease
right-of-use assets
|
|
65,027
|
|
—
|
|
Reorganization value
in excess of amounts allocable to identifiable assets,
net
|
|
41,580
|
|
41,580
|
|
Other
assets
|
|
185,727
|
|
184,004
|
|
|
|
3,058,397
|
|
2,641,511
|
|
Mortgage
Banking:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
21,363
|
|
23,092
|
|
Restricted
cash
|
|
3,393
|
|
3,071
|
|
Mortgage loans held
for sale, net
|
|
462,693
|
|
458,324
|
|
Property and
equipment, net
|
|
6,240
|
|
6,510
|
|
Operating lease
right-of-use assets
|
|
14,078
|
|
—
|
|
Reorganization value
in excess of amounts allocable to identifiable assets,
net
|
|
7,347
|
|
7,347
|
|
Other
assets
|
|
29,729
|
|
26,078
|
|
|
|
544,843
|
|
524,422
|
|
Total
assets
|
|
$
|
3,603,240
|
|
$
|
3,165,933
|
|
|
|
|
|
|
|
NVR,
Inc.
|
|
Consolidated Balance
Sheets (Continued)
|
|
(in thousands, except
share and per share data)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
June 30,
2019
|
|
December 31,
2018
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
Homebuilding:
|
|
|
|
|
|
Accounts
payable
|
|
$
|
309,419
|
|
$
|
244,496
|
|
Accrued expenses and
other liabilities
|
|
299,466
|
|
332,871
|
|
Customer
deposits
|
|
146,207
|
|
138,246
|
|
Operating lease
liabilities
|
|
72,360
|
|
—
|
|
Senior
notes
|
|
597,991
|
|
597,681
|
|
|
|
1,425,443
|
|
1,313,294
|
|
Mortgage
Banking:
|
|
|
|
|
|
Accounts payable and
other liabilities
|
|
43,387
|
|
44,077
|
|
Operating lease
liabilities
|
|
14,971
|
|
—
|
|
|
|
58,358
|
|
44,077
|
|
Total
liabilities
|
|
1,483,801
|
|
1,357,371
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
Common stock, $0.01
par value; 60,000,000 shares authorized; 20,555,330
shares issued as of both June 30, 2019 and December 31,
2018
|
|
206
|
|
206
|
|
Additional paid-in
capital
|
|
1,962,156
|
|
1,820,223
|
|
Deferred compensation
trust – 107,295 and 107,340 shares of NVR, Inc.
common stock as of June 30, 2019 and December 31, 2018,
respectively
|
|
(16,912)
|
|
(16,937)
|
|
Deferred compensation
liability
|
|
16,912
|
|
16,937
|
|
Retained
earnings
|
|
7,429,948
|
|
7,031,333
|
|
Less treasury stock
at cost – 16,911,734 and 16,977,499 shares as of June 30,
2019 and December 31, 2018, respectively
|
|
(7,272,871)
|
|
(7,043,200)
|
|
Total
shareholders' equity
|
|
2,119,439
|
|
1,808,562
|
|
Total liabilities
and shareholders' equity
|
|
$
|
3,603,240
|
|
$
|
3,165,933
|
|
|
|
|
|
|
|
NVR,
Inc.
|
Operating
Activity
|
(dollars in
thousands)
|
(Unaudited)
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Homebuilding
data:
|
|
|
|
|
|
|
|
|
New orders
(units)
|
|
|
|
|
|
|
|
|
Mid Atlantic
(1)
|
|
2,322
|
|
2,414
|
|
4,766
|
|
4,917
|
North East
(2)
|
|
364
|
|
365
|
|
677
|
|
736
|
Mid East
(3)
|
|
1,276
|
|
1,142
|
|
2,490
|
|
2,438
|
South East
(4)
|
|
1,277
|
|
1,043
|
|
2,445
|
|
2,047
|
Total
|
|
5,239
|
|
4,964
|
|
10,378
|
|
10,138
|
|
|
|
|
|
|
|
|
|
Average new order
price
|
|
$
|
358.6
|
|
$
|
376.3
|
|
$
|
362.7
|
|
$
|
377.3
|
|
|
|
|
|
|
|
|
|
Settlements
(units)
|
|
|
|
|
|
|
|
|
Mid Atlantic
(1)
|
|
2,326
|
|
2,239
|
|
4,469
|
|
4,165
|
North East
(2)
|
|
314
|
|
354
|
|
617
|
|
655
|
Mid East
(3)
|
|
1,097
|
|
1,092
|
|
2,127
|
|
1,971
|
South East
(4)
|
|
983
|
|
926
|
|
2,000
|
|
1,716
|
Total
|
|
4,720
|
|
4,611
|
|
9,213
|
|
8,507
|
|
|
|
|
|
|
|
|
|
Average settlement
price
|
|
$
|
372.3
|
|
$
|
379.6
|
|
$
|
369.1
|
|
$
|
380.9
|
|
|
|
|
|
|
|
|
|
Backlog
(units)
|
|
|
|
|
|
|
|
|
Mid Atlantic
(1)
|
|
|
|
|
|
4,445
|
|
4,976
|
North East
(2)
|
|
|
|
|
|
623
|
|
763
|
Mid East
(3)
|
|
|
|
|
|
2,169
|
|
2,365
|
South East
(4)
|
|
|
|
|
|
2,293
|
|
2,058
|
Total
|
|
|
|
|
|
9,530
|
|
10,162
|
|
|
|
|
|
|
|
|
|
Average backlog
price
|
|
|
|
|
|
$
|
369.0
|
|
$
|
380.0
|
|
|
|
|
|
|
|
|
|
New order
cancellation rate
|
|
13%
|
|
|
13%
|
|
|
14%
|
|
|
13%
|
|
Community count
(average)
|
|
470
|
|
480
|
|
460
|
|
483
|
Lots controlled at
end of period
|
|
|
|
|
|
101,400
|
|
94,200
|
|
|
|
|
|
|
|
|
|
Mortgage banking
data:
|
|
|
|
|
|
|
|
|
Loan
closings
|
|
$
|
1,231,039
|
|
$
|
1,214,101
|
|
$
|
2,372,037
|
|
$
|
2,223,774
|
Capture
rate
|
|
89%
|
|
|
87%
|
|
|
89%
|
|
|
87%
|
|
|
|
|
|
|
|
|
|
|
Common stock
information:
|
|
|
|
|
|
|
|
|
Shares outstanding at
end of period
|
|
|
|
|
|
3,643,596
|
|
3,628,515
|
Number of shares
repurchased
|
|
29,826
|
|
42,112
|
|
111,655
|
|
158,380
|
Aggregate cost of
shares repurchased
|
|
$
|
87,980
|
|
$
|
126,296
|
|
$
|
304,479
|
|
$
|
483,538
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Maryland, Virginia,
West Virginia, Delaware and Washington, D.C.
|
(2)
|
New Jersey and
Eastern Pennsylvania
|
(3)
|
New York, Ohio,
Western Pennsylvania, Indiana and Illinois
|
(4)
|
North Carolina, South
Carolina, Tennessee and Florida
|
|
|
View original
content:http://www.prnewswire.com/news-releases/nvr-inc-announces-second-quarter-results-300887734.html
SOURCE NVR, Inc.