0000915840
false
0000915840
2024-05-01
2024-05-01
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest reported event):
May 1, 2024
BEAZER HOMES USA, INC.
(Exact name of registrant as specified in its charter)
Delaware 001-12822 58-2086934
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
2002 Summit Boulevard
,
15th Floor
Atlanta
,
Georgia
30319
(Address of Principal Executive Offices)
(
770
)
829-3700
(Registrant's telephone number, including area code)
None
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, $0.001 par value BZH New York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as
defined in Rule 405 of the Securities Act of 1933 ((s)230.405 of this chapter)
or Rule 12b-2 of the Securities Exchange Act of 1934 ((s)240.12b-2 of this
chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has
elected not to use the extended transition period for complying with any new
or revised financial accounting standards provided pursuant to Section 13(a)
of the Exchange Act.
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Item 2.02 Results of Operations and Financial Condition
On
May 1, 2024
, Beazer Homes USA, Inc. issued a press release announcing results of
operations for the three and six months ended March 31, 2024. A copy of the
press release is attached hereto as Exhibit 99.1.
The information provided pursuant to this Item 2.02, including Exhibit 99.1 in
Item 9.01, is "furnished" and shall not be deemed to be "filed" with the
Securities and Exchange Commission or incorporated by reference in any filing
under the Securities and Exchange Act of 1934, as amended, or the Securities
Act of 1933, as amended, except as shall be expressly set forth by specific
reference in any such filings.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
99.1 Press Release dated
May
1, 20
24
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
BEAZER HOMES USA, Inc.
Date: May 1, 2024 By: /s/ David I. Goldberg
David I. Goldberg
Senior Vice President and Chief Financial Officer
Exhibit 99.1
PRESS RELEASE
Beazer Homes Reports Second Quarter Fiscal 2024 Results
ATLANTA, May 1, 2024
- Beazer Homes USA, Inc. (NYSE: BZH) (
www.beazer.com
) today announced its financial results for the three and six months ended
March 31, 2024.
"Beazer delivered another successful quarter with strong sales, solid margins
and growth in both our community count and our lot position," said Allan P.
Merrill, the company's Chairman and Chief Executive Officer. "The combination
of these factors and our careful management of overheads enabled us to
generate nearly $59 million in adjusted EBITDA."
Commenting on current market conditions, Mr. Merrill said, "While
affordability remains challenging, especially in light of the recent increase
in mortgage rates, the relatively strong economy and lack of resale inventory
leave us on track to achieve our full year profitability and double-digit
return on equity goals for the fiscal year."
Looking further out, Mr. Merrill concluded, "We remain optimistic for the
years ahead given the persistent undersupply of housing and our consistent
advancement towards our multi-year goals. Further growth in community count,
combined with reductions in leverage and the full implementation of our Zero
Energy Ready program should position us to generate durable value for our
shareholders."
Beazer Homes Fiscal Second Quarter 2024 Highlights and Comparison to Fiscal
Second Quarter 2023
.
Net income from continuing operations was $39.2 million, or $1.26 per diluted
share, compared to net income from continuing operations of $34.7 million, or
$1.13 per diluted share, in fiscal second quarter 2023
.
Adjusted EBITDA was $58.8 million, down 5.4%
.
Homebuilding revenue was $538.6 million, down 0.6% on a 1.8% decrease in home
closings to 1,044, partially offset by a 1.2% increase in average selling
price (ASP) to $515.9 thousand
.
Homebuilding gross margin was 18.7%, flat compared to a year ago. Excluding
impairments, abandonments and amortized interest, homebuilding gross margin
was 21.7%, down 30 basis points
.
SG&A as a percentage of total revenue was 11.5%, up 30 basis points
.
Net new orders were 1,299, up 10.0% on a 13.8% increase in average community
count to 140, partially offset by a 3.3% decrease in orders per community per
month to 3.1
.
Backlog dollar value was $1.08 billion, up 8.9% on a 10.1% increase in backlog
units to 2,046, partially offset by a 1.1% decrease in ASP of homes in backlog
to $525.5 thousand
.
Land acquisition and land development spending was $197.8 million, up 75.0%
from $113.0 million
.
Unrestricted cash at quarter end was $132.9 million; total liquidity was
$432.9 million
.
Refinanced $197.9 million of its 6.750% Senior Unsecured Notes due 2025
through the issuance of $250.0 million of 7.500% Senior Unsecured Notes due
2031
.
Extended the maturity of its $
300.0 million S
enior Unsecured Revolving Credit Facility to March 2028
.
Total debt to total capitalization ratio of 46.8% at quarter end compared to
49.7% a year ago. Net debt to net capitalization ratio of 43.4% at quarter end
compared to 42.7% a year ago
The following provides additional details on the Company's performance during
the fiscal second quarter 2024:
Profitability
. Net income from continuing operations was $39.2 million, generating diluted
earnings per share of $1.26.
This included an $8.6 million, or $0.28 per diluted share, one-time gain on
sale of investment in a technology company specializing in digital marketing
for new home communities.
Second quarter adjusted EBITDA of $58.8 million, which excludes the one-time
gain on sale of investment, was down $3.3 million, or 5.4%,
primarily due to lower homebuilding gross profit.
Orders
. Net new orders for the second quarter increased to 1,299, up 10.0% from
1,181 in the prior year quarter primarily driven by a
13.8% increase in average community count to 140 from 123 a year ago,
partially offset by a
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3.3% decrease in sales pace to 3.1 orders per community per month, down from
3.2 in the prior year quarter.
The cancellation rate for the quarter was 12.2%, down from 18.6% in the prior
year quarter.
Backlog
. The dollar value of homes in backlog as of March 31, 2024 was $1.08 billion,
representing 2,046 homes, compared to $987.2 million, representing 1,858
homes, at the same time last year. The ASP of homes in backlog was $525.5
thousand, down 1.1% versus the prior year quarter.
Homebuilding Revenue
. Second quarter homebuilding revenue was $538.6 million, down 0.6%
year-over-year. The decrease in homebuilding revenue was driven by a 1.8%
decrease in home closings to 1,044 homes, partially offset by a 1.2% increase
in the ASP to $515.9 thousand. The decrease in closings was primarily due to a
lower volume of spec homes sold and delivered within the current quarter
compared to the prior year quarter.
Homebuilding Gross Margin
. Homebuilding gross margin (excluding impairments, abandonments and amortized
interest) was 21.7% for the second quarter, down from 22.0% in the prior year
quarter as a result of changes in product and community mix and an increase in
closing cost incentives, partially offset by a decrease in build costs.
SG&A Expenses
. Selling, general and administrative expenses as a percentage of total
revenue was 11.5% for the quarter, up 30 basis points year-over-year
primarily due to higher sales and marketing costs as the Company prepares for
new community activations and future growth, as well as a slight decrease in
homebuilding revenue.
Land Position.
For the current fiscal quarter, land acquisition and land development spending
was $197.8 million, up 75.0% year-over-year.
Controlled lots increased 12.9% to 26,887, compared to 23,820 from
the prior year quarter. Excluding land held for future development and land
held for sale lots, active lots controlled were 26,218, up 13.5% year-over-year.
As of March 31, 2024, the Company controlled 51.6% of its total active lots
through option agreements compared to 54.0% as of March 31, 2023.
Liquidity
. At the close of the second quarter, the Company had $432.9 million of
available liquidity, including $132.9 million of unrestricted cash and $300.0
million of remaining capacity under the unsecured revolving credit facility,
compared to total available liquidity
of $505.8 million a year ago. In March, the Company issued $250.0 million of
7.500% Senior Unsecured Notes due 2031. The proceeds were used to redeem the
remaining $197.9 million of the Company's 6.750% Senior Notes due 2025. In
addition, the Company extended the maturity under its existing
$300.0 million S
enior Unsecured Revolving Credit Facility to March 2028.
Commitment to ESG Initiatives
During the quarter, the Company demonstrated its continued leadership and
commitment to advancing ESG.
Beazer Homes received the ENERGY STAR Partner of the Year Award with Sustained
Excellence for the ninth consecutive year. This award highlights the Company's
dedication to continually enhancing the energy efficiency of its homes in
support of its industry-first pledge that, by the end of 2025, every new home
that we start will be Zero Energy Ready, which means it will meet the
requirements of the U.S. Department of Energy's Zero Energy Ready Home
program. By the end of the second quarter, the Company had Zero Energy Ready
homes under construction in every division, consisting of 77% of new home
starts. This represents a significant increase from the 54% achieved last
quarter and the 28% from the prior year quarter.
In addition, the Company earned the 2024 Top Workplaces USA award for the
second consecutive year, placing fifth among companies headquartered in
Georgia on the list published by USA Today. Participating companies are
measured on anonymous employee feedback comparing the survey's research-based
statements, including 15 Culture Drivers that are proven to predict high
performance against industry benchmarks.
Further, the Company was recognized on Newsweek's list of America's Most
Trustworthy Companies in America for the third year in a row. This award
identified companies based on an independent survey of approximately 25,000
U.S. residents who rated companies they knew from the perspective of
customers, investors and employees.
Finally, Beazer Homes annou
nced the donation of $1.9 million to Fisher House Foundation, representing
extensive fundraising efforts by Beazer Homes employees, generous
contributions from its partners, and a 150% match by the Beazer Charity
Foundation for all donations. For more than 25 years, th
e Fisher House has been providing "a home
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away from home" for military and veterans' families to stay free of charge,
while a loved one is receiving treatment at major military and VA medical
centers.
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Summary results for the three and six months ended March 31, 2024 are as
follows:
Three Months Ended March 31,
2024 2023 Change*
New home orders, net of cancellations 1,299 1,181 10.0 %
Cancellation rates 12.2 % 18.6 % (640) bps
Orders per community per month 3.1 3.2 (3.3) %
Average active community count 140 123 13.8 %
Active community count at quarter-end 145 121 19.8 %
Land acquisition and land development spending (in millions) $ 197.8 $ 113.0 75.0 %
Total home closings 1,044 1,063 (1.8) %
ASP from closings (in thousands) $ 515.9 $ 509.9 1.2 %
Homebuilding revenue (in millions) $ 538.6 $ 542.0 (0.6) %
Homebuilding gross margin 18.7 % 18.7 % 0 bps
Homebuilding gross margin, excluding impairments and abandonments (I&A) 18.7 % 18.8 % (10) bps
Homebuilding gross margin, excluding I&A and interest amortized to cost of sales 21.7 % 22.0 % (30) bps
Income from continuing operations before income taxes (in millions) $ 45.9 $ 39.8 15.4 %
Expense from income taxes (in millions) $ 6.7 $ 5.1 32.3 %
Income from continuing operations, net of tax (in millions) $ 39.2 $ 34.7 12.9 %
Basic income per share from continuing operations $ 1.27 $ 1.14 11.4 %
Diluted income per share from continuing operations $ 1.26 $ 1.13 11.5 %
Net income (in millions) $ 39.2 $ 34.7 12.9 %
Adjusted EBITDA (in millions) $ 58.8 $ 62.1 (5.4) %
LTM Adjusted EBITDA (in millions) $ 259.6 $ 340.9 (23.9) %
Total debt to total capitalization ratio 46.8 % 49.7 % (290) bps
Net debt to net capitalization ratio 43.4 % 42.7 % 70 bps
* Change and totals are calculated using unrounded numbers.
"LTM" indicates amounts for the trailing 12 months.
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Six Months Ended March 31,
2024 2022 Change*
New home orders, net of cancellations 2,122 1,663 27.6 %
Cancellation rates 15.0 % 25.0 % (1,000) bps
LTM orders per community per month 2.7 2.2 22.7 %
Land acquisition and land development spending (in millions) $ 396.5 $ 227.7 74.1 %
Total home closings 1,787 1,896 (5.7) %
ASP from closings (in thousands) $ 514.6 $ 520.1 (1.1) %
Homebuilding revenue (in millions) $ 919.6 $ 986.1 (6.7) %
Homebuilding gross margin 19.2 % 18.9 % 30 bps
Homebuilding gross margin, excluding I&A 19.2 % 19.0 % 20 bps
Homebuilding gross margin, excluding I&A and interest amortized to cost of sales 22.2 % 22.1 % 10 bps
Income from continuing operations before income taxes (in millions) $ 68.8 $ 68.4 0.7 %
Expense from income taxes (in millions) $ 7.9 $ 9.2 (14.4) %
Income from continuing operations, net of tax (in millions) $ 60.9 $ 59.1 3.0 %
Basic income per share from continuing operations $ 1.98 $ 1.94 2.1 %
Diluted income per share from continuing operations $ 1.96 $ 1.93 1.6 %
Net income (in millions) $ 60.9 $ 59.0 3.2 %
Adjusted EBITDA (in millions) $ 96.8 $ 109.3 (11.4) %
* Change and totals are calculated using unrounded numbers.
"LTM" indicates amounts for the trailing 12 months.
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As of March 31,
2024 2023 Change
Backlog units 2,046 1,858 10.1 %
Dollar value of backlog (in millions) $ 1,075.1 $ 987.2 8.9 %
ASP in backlog (in thousands) $ 525.5 $ 531.3 (1.1) %
Land and lots controlled 26,887 23,820 12.9 %
Conference Call
The Company will hold a conference call on May 1, 2024 at 5:00 p.m. ET to
discuss these results. Interested parties may listen to the conference call
and view the Company's slide presentation on the "Investor Relations" page of
the Company's website,
www.beazer.com
. In addition, the conference call will be available by telephone at
800-475-0542 (for international callers, dial 630-395-0227). To be admitted to
the call, enter the pass code "8571348". A replay of the conference call will
be available, until 11:59 PM ET on May 31, 2024 at 800-839-2204 (for
international callers, dial 203-369-3032) with pass code "3740".
About Beazer Homes
Headquartered in Atlanta, Beazer Homes (NYSE: BZH) is one of the country's
largest homebuilders. Every Beazer home is designed and built to provide
Surprising Performance, giving you more quality and more comfort from the
moment you move in - saving you money every month. With Beazer's Choice
Plans", you can personalize your primary living areas - giving you a choice of
how you want to live in the home, at no additional cost. And unlike most
national homebuilders, we empower our customers to shop and compare loan
options. Our Mortgage Choice program gives you the resources to easily compare
multiple loan offers and choose the best lender and loan offer for you, saving
you thousands over the life of your loan.
We build our homes in Arizona, California, Delaware, Florida, Georgia,
Indiana, Maryland, Nevada, North Carolina, South Carolina, Tennessee, Texas,
and Virginia. For more information, visit
beazer.com
, or check out Beazer on
Facebook
,
Instagram
and
Twitter
.
This press release contains forward-looking statements. These forward-looking
statements represent our expectations or beliefs concerning future events, and
it is possible that the results described in this press release will not be
achieved. These forward-looking statements are subject to risks, uncertainties
and other factors, many of which are outside of our control, that could cause
actual results to differ materially from the results discussed in the
forward-looking statements, including, among other things:
.
the cyclical nature of the homebuilding industry and deterioration in
homebuilding industry conditions;
.
other economic changes nationally and in local markets, including declines in
employment levels, increases in the number of foreclosures and wage levels,
each of which are outside our control and may impact consumer confidence and
affect the affordability of, and demand for, the homes we sell;
.
elevated mortgage interest rates for prolonged periods, as well as further
increases
and reduced availability of mortgage financing due to, among other factors,
additional actions by the Federal Reserve to address sharp increases in
inflation;
.
financial institution disruptions, such as the bank failures that occurred in
2023;
.
continued supply chain challenges negatively impacting our homebuilding
production, including shortages of raw materials and other critical components
such as windows, doors, and appliances;
.
continued shortages of or increased costs for labor used in housing
production, and the level of quality and craftsmanship provided by such labor;
.
inaccurate estimates related to homes to be delivered in the future (backlog),
as they are subject to various cancellation risks that cannot be fully
controlled;
.
factors affecting margins, such as adjustments to home pricing, increased
sales incentives and mortgage rate buy down programs in order to remain
competitive;
.
decreased revenues;
.
decreased land values underlying land option agreements;
.
increased land development costs in communities under development or delays or
difficulties in implementing initiatives to reduce our cycle times and
production and overhead cost structures;
.
not being able to pass on cost increases (including cost increases due to
increasing the energy efficiency of our homes) through pricing increases;
.
the availability and cost of land and the risks associated with the future
value of our inventory;
6
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.
our ability to raise debt and/or equity capital, due to factors such as
limitations in the capital markets (including market volatility), adverse
credit market conditions and financial institution disruptions, and our
ability to otherwise meet our ongoing liquidity needs (which could cause us to
fail to meet the terms of our covenants and other requirements under our
various debt instruments and therefore trigger an acceleration of a
significant portion or all of our outstanding debt obligations), including the
impact of any downgrades of our credit ratings or reduction in our liquidity
levels;
.
market perceptions regarding any capital raising initiatives we may undertake
(including future issuances of equity or debt capital);
.
changes in tax laws or otherwise regarding the deductibility of mortgage
interest expenses and real estate taxes, including those resulting from
regulatory guidance and interpretations issued with respect thereto, such as
the IRS's recent guidance regarding heightened qualification requirements for
federal credits for building energy-efficient homes;
.
increased competition or delays in reacting to changing consumer preferences
in home design;
.
natural disasters or other related events that could result in delays in land
development or home construction, increase our costs or decrease demand in the
impacted areas;
.
terrorist acts, protests and civil unrest, political uncertainty, acts of war
or other factors over which the Company has no control, such as the conflict
between Russia and Ukraine and the conflict in the Gaza strip;
.
potential negative impacts of public health emergencies such as the COVID-19
pandemic;
.
the potential recoverability of our deferred tax assets;
.
increases in corporate tax rates;
.
potential delays or increased costs in obtaining necessary permits as a result
of changes to, or complying with, laws, regulations or governmental policies,
and possible penalties for failure to comply with such laws, regulations or
governmental policies, including those related to the environment;
.
the results of litigation or government proceedings and fulfillment of any
related obligations;
.
the impact of construction defect and home warranty claims;
.
the cost and availability of insurance and surety bonds, as well as the
sufficiency of these instruments to cover potential losses incurred;
.
the impact of information technology failures, cybersecurity issues or data
security breaches, including cybersecurity incidents impacting third-party
service providers that we depend on to conduct our business;
.
the impact of governmental regulations on homebuilding in key markets, such as
regulations limiting the availability of water and electricity (including
availability of electrical equipment such as transformers and meters); and
.
the success of our ESG initiatives, including our ability to meet our goal
that by the end of 2025 every home we start will be Zero Energy Ready, as well
as the success of any other related partnerships or pilot programs we may
enter into in order to increase the energy efficiency of our homes and prepare
for a Zero Energy Ready future.
Any forward-looking statement, including any statement expressing confidence
regarding future outcomes, speaks only as of the date on which such statement
is made and, except as required by law, we undertake no obligation to update
any forward-looking statement to reflect events or circumstances after the
date on which such statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time, and it is not
possible to predict all such factors.
CONTACT: Beazer Homes USA, Inc.
David I. Goldberg
Sr. Vice President & Chief Financial Officer
770-829-3700
investor.relations@beazer.com
-Tables Follow-
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BEAZER HOMES USA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Six Months Ended
March 31, March 31,
in thousands (except per share data) 2024 2023 2024 2023
Total revenue $ 541,540 $ 543,908 $ 928,358 $ 988,836
Home construction and land sales expenses 439,687 440,901 748,775 799,871
Inventory impairments and abandonments - 111 - 301
Gross profit 101,853 102,896 179,583 188,664
Commissions 18,285 18,305 31,531 32,410
General and administrative expenses 44,004 42,779 85,990 83,427
Depreciation and amortization 3,573 3,020 5,806 5,533
Operating income 35,991 38,792 56,256 67,294
Loss on extinguishment of debt, net (424) - (437) (515)
Other income, net 10,343 1,007 13,000 1,583
Income from continuing operations before income taxes 45,910 39,799 68,819 68,362
Expense from income taxes 6,739 5,092 7,920 9,247
Income from continuing operations 39,171 34,707 60,899 59,115
Loss from discontinued operations, net of tax - - - (77)
Net income $ 39,171 $ 34,707 $ 60,899 $ 59,038
Weighted-average number of shares:
Basic 30,769 30,394 30,681 30,464
Diluted 31,133 30,610 31,064 30,702
Basic income per share:
Continuing operations $ 1.27 $ 1.14 $ 1.98 $ 1.94
Discontinued operations - - - -
Total $ 1.27 $ 1.14 $ 1.98 $ 1.94
Diluted income per share:
Continuing operations $ 1.26 $ 1.13 $ 1.96 $ 1.93
Discontinued operations - - - -
Total $ 1.26 $ 1.13 $ 1.96 $ 1.93
Three Months Ended Six Months Ended
March 31, March 31,
Capitalized Interest in Inventory 2024 2023 2024 2023
Capitalized interest in inventory, beginning of period $ 119,596 $ 113,143 $ 112,580 $ 109,088
Interest incurred 19,689 18,034 37,895 35,864
Capitalized interest amortized to home construction and land sales expenses (16,071) (17,291) 27,261 (31,066)
Capitalized interest in inventory, end of period $ 123,214 $ 113,886 $ 123,214 $ 113,886
8
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BEAZER HOMES USA, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
in thousands (except share March 31, 2024 September 30, 2023
and per share data)
ASSETS
Cash and cash $ 132,867 $ 345,590
equivalents
Restricted cash 32,527 40,699
Accounts receivable (net of allowance 54,226 45,598
of $284 and $284, respectively)
Income tax receivable 246 -
Owned inventory 2,057,461 1,756,203
Deferred tax 132,521 133,949
assets, net
Property and 36,839 31,144
equipment, net
Operating lease 15,867 17,398
right-of-use assets
Goodwill 11,376 11,376
Other assets 41,480 29,076
Total assets $ 2,515,410 $ 2,411,033
LIABILITIES AND
STOCKHOLDERS' EQUITY
Trade accounts $ 168,669 $ 154,256
payable
Operating lease 17,543 18,969
liabilities
Other liabilities 144,310 156,961
Total debt (net of debt issuance costs 1,023,311 978,028
of $9,314 and $5,759, respectively)
Total liabilities 1,353,833 1,308,214
Stockholders' equity:
Preferred stock (par value $0.01 per share, - -
5,000,000 shares authorized, no shares issued)
Common stock (par value $0.001 per share, 63,000,000 shares authorized, 31,547,284 32 31
issued and outstanding and 31,351,434 issued and outstanding, respectively)
Paid-in capital 862,636 864,778
Retained earnings 298,909 238,010
Total stockholders' 1,161,577 1,102,819
equity
Total liabilities and $ 2,515,410 $ 2,411,033
stockholders' equity
Inventory Breakdown
Homes under $ 851,278 $ 644,363
construction
Land under development 951,221 870,740
Land held for 19,879 19,879
future development
Land held for sale 18,264 18,579
Capitalized interest 123,214 112,580
Model homes 93,605 90,062
Total owned $ 2,057,461 $ 1,756,203
inventory
9
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BEAZER HOMES USA, INC.
CONSOLIDATED OPERATING AND FINANCIAL DATA - CONTINUING OPERATIONS
Three Months Ended March 31, Six Months Ended March 31,
SELECTED OPERATING DATA 2024 2023 2024 2023
Closings:
West region 667 631 1,121 1,141
East region 215 236 351 391
Southeast region 162 196 315 364
Total closings 1,044 1,063 1,787 1,896
New orders, net of cancellations:
West region 860 631 1,393 879
East region 263 296 435 416
Southeast region 176 254 294 368
Total new orders, net 1,299 1,181 2,122 1,663
As of March 31,
Backlog units: 2024 2023
West region 1,305 995
East region 407 435
Southeast region 334 428
Total backlog units 2,046 1,858
Aggregate dollar value of homes in backlog (in millions) $ 1,075.1 $ 987.2
ASP in backlog (in thousands) $ 525.5 $ 531.3
in thousands Three Months Ended March 31, Six Months Ended March 31,
SUPPLEMENTAL FINANCIAL DATA 2024 2023 2024 2023
Homebuilding revenue:
West region $ 344,864 $ 328,961 $ 579,273 $ 603,283
East region 111,631 119,869 183,384 205,900
Southeast region 82,141 93,177 156,898 176,908
Total homebuilding revenue $ 538,636 $ 542,007 $ 919,555 $ 986,091
Revenue:
Homebuilding $ 538,636 $ 542,007 $ 919,555 $ 986,091
Land sales and other 2,904 1,901 8,803 2,745
Total revenue $ 541,540 $ 543,908 $ 928,358 $ 988,836
Gross profit:
Homebuilding $ 100,774 $ 101,588 $ 176,717 $ 186,702
Land sales and other 1,079 1,308 2,866 1,962
Total gross profit $ 101,853 $ 102,896 $ 179,583 $ 188,664
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Reconciliation of homebuilding gross profit and the related gross margin
excluding impairments and abandonments and interest amortized to cost of sales
(each a non-GAAP financial measure) to their most directly comparable GAAP
measures is provided for each period discussed below. Management believes that
this information assists investors in comparing the operating characteristics
of homebuilding activities by eliminating many of the differences in
companies' respective level of impairments and level of debt. These non-GAAP
financial measures may not be comparable to other similarly titled measures of
other companies and should not be considered in isolation or as a substitute
for, or superior to, financial measures prepared in accordance with GAAP.
Three Months Ended March 31, Six Months Ended March 31,
in thousands 2024 2023 2024 2023
Homebuilding gross $ 100,774 18.7 % $ 101,588 18.7 % $ 176,717 19.2 % $ 186,702 18.9 %
profit/margin
Inventory impairments - 111 - 301
and abandonments (I&A)
Homebuilding gross 100,774 18.7 % 101,699 18.8 % 176,717 19.2 % 187,003 19.0 %
profit/margin excluding I&A
Interest amortized 16,071 17,291 27,261 31,066
to cost of sales
Homebuilding gross profit/margin excluding $ 116,845 21.7 % $ 118,990 22.0 % $ 203,978 22.2 % $ 218,069 22.1 %
I&A and interest amortized to cost of sales
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Reconciliation of Adjusted EBITDA (a non-GAAP financial measure) to total
company net income, the most directly comparable GAAP measure, is provided for
each period discussed below. Management believes that Adjusted EBITDA assists
investors in understanding and comparing core operating results and underlying
business trends by eliminating many of the differences in companies'
respective capitalization, tax position, level of impairments, and other
non-recurring items. This non-GAAP financial measure may not be comparable to
other similarly titled measures of other companies and should not be
considered in isolation or as a substitute for, or superior to, financial
measures prepared in accordance with GAAP.
Three Months Six Months Ended LTM Ended March 31,
Ended March 31, March 31, (a)
in 2024 2023 2024 2023 2024 2023
thousands
Net $ 39,171 $ 34,707 $ 60,899 $ 59,038 $ 160,472 $ 200,185
income
Expense 6,739 5,092 7,920 9,225 22,631 45,961
from
income
taxes
Interest amortized to home 16,071 17,291 27,261 31,066 64,684 72,261
construction and land
sales expenses and capitalized
interest impaired
EBIT 61,981 57,090 96,080 99,329 247,787 318,407
Depreciation 3,573 3,020 5,806 5,533 12,471 12,981
and
amortization
EBITDA 65,554 60,110 101,886 104,862 260,258 331,388
Stock-based 1,389 1,678 3,062 3,258 7,079 7,204
compensation
expense
Loss on 424 - 437 515 468 42
extinguishment
of
debt
Inventory - 111 - 301 340 1,890
impairments
and
abandonments
(b)
Gain on (8,591) - (8,591) - (8,591) -
sale
of
investment
(c)
Severance - 224 - 335 - 335
expenses
Adjusted $ 58,776 $ 62,123 $ 96,794 $ 109,271 $ 259,554 $ 340,859
EBITDA
(a)
"LTM" indicates amounts for the trailing 12 months.
(b)
In periods during which we impaired certain of our inventory assets,
capitalized interest that is impaired is included in the line above titled
"Interest amortized to home construction and land sales expenses and
capitalized interest impaired."
(c)
We previously held a minority interest in a technology company specializing in
digital marketing for new home communities, which was sold d
uring the quarter ended March 31, 2024
. In exchange for the previously held investment, we received cash in escrow
along with a minority partnership interest in the acquiring company, which was
recorded within other assets in our condensed consolidated balance sheets. The
resulting gain of $8.6 million from this transaction was recognized in other
income, net on our condensed consolidated statement of operations.
The Company believes excluding this one-time gain from Adjusted EBITDA
provides a better reflection of the Company's performance as this item is not
representative of our core operations.
12
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Reconciliation of net debt to net capitalization ratio (a non-GAAP financial
measure) to total debt to total capitalization ratio, the most directly
comparable GAAP measure, is provided for each period below. Management
believes that net debt to net capitalization ratio is useful in understanding
the leverage employed in our operations and as an indicator of our ability to
obtain financing. This non-GAAP financial measure may not be comparable to
other similarly titled measures of other companies and should not be
considered in isolation or as a substitute for, or superior to, financial
measures prepared in accordance with GAAP.
in thousands As of March 31, 2024 As of March 31, 2023
Total debt $ 1,023,311 $ 985,220
Stockholders' equity 1,161,577 998,985
Total capitalization $ 2,184,888 $ 1,984,205
Total debt to total capitalization ratio 46.8 % 49.7 %
Total debt $ 1,023,311 $ 985,220
Less: cash and cash equivalents 132,867 240,829
Net debt 890,444 744,391
Stockholders' equity 1,161,577 998,985
Net capitalization $ 2,052,021 $ 1,743,376
Net debt to net capitalization ratio 43.4 % 42.7 %
13
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