ATLANTA, Jan. 23 /PRNewswire-FirstCall/ -- Beazer Homes USA, Inc. (NYSE: BZH) (www.beazer.com ) today announced results for the quarter ended December 31, 2002, the first quarter of its 2003 fiscal year. Highlights of the quarter, compared to the same quarter of the prior year, are as follows:

• Record Diluted EPS: $2.75 (up 11% vs. $2.47 in prior year)

• Home closings: 3,482 (up 47%)

• Total revenues $700 million (up 43%)

• Earnings before interest, taxes, depreciation and amortization (EBITDA): $75.7 million (up 59%)

• Gross margin (before interest): 21.2% (up 130 basis points)

• EBITDA Margin: 10.8% (up 110 basis points)

• Net income: $36.9 million (up 59%)

• Debt to total capitalization: 47% (down from 53%)

• Net debt to total capitalization: 44% (down from 53%)

• New orders: 3,141 homes (up 25%)

• Backlog: 6,178 homes (up 50%), sales value $1.2 billion (up 52%)

Record Earnings for First Quarter of Fiscal 2003

Ian J. McCarthy, President and Chief Executive Officer of Beazer Homes, said, "We are extremely pleased to announce record December quarter EPS of $2.75 and net income of $37 million for the first quarter of our 2003 fiscal year. Net income increased 59% over the first quarter of fiscal 2002 while revenues were up 43%. Once again, we reported a greater increase in net income than revenues as our gross margin hit an all-time company record. Gross margin before interest was 21.2%, up 130 basis points from December 2001."

Mr. McCarthy continued, "The increase in our gross margin for the quarter reflects the continuing strong housing environment, as well as our ability to control costs and build more efficiently. Initiatives to control our building costs, through increased use of national purchasing contracts and more efficient product design, have been and continue to be a major emphasis at Beazer and are beginning to yield significant benefits that we believe will accelerate in the coming years."

Record First Quarter New Orders and Backlog

Mr. McCarthy also said, "New orders were up 25% during the quarter ended December 31, 2002, and at the end of the quarter our backlog was up 50% in units and 52% in dollar value. New orders and backlog in the December 2002 quarter include Crossmann Communities, which we acquired in April 2002. Crossmann's operations have been fully integrated with Beazer's, including merging operations where there was geographic overlap."

Strong Financial Position

David S. Weiss, Executive Vice President and Chief Financial Officer, said, "We ended the December 2002 quarter with one of our strongest balance sheets ever. Our ratio of debt to total capitalization improved from 53% to 47% relative to the December quarter of the prior year. In addition, we ended the quarter with $80 million of cash on hand and no borrowings outstanding under our revolving credit facility, making our net debt to total capitalization 44%. Our significant cash balance is particularly notable given that this is the end of a seasonally slow quarter when we typically use cash and borrow under our revolving credit facility. At the end of last year's December quarter, for instance, we had no cash on hand and had outstanding borrowings of $34 million under our revolver. This performance demonstrates how we have both grown the business and generated positive cash flow from operations over the past year."

Mr. Weiss also said, "Our current conservative financial position gives us the financial flexibility to adapt to changes in the homebuilding or general economic environment. It also gives us the ability to opportunistically shift between growth in our existing business and expansion through acquisition as we see appropriate. Given the current environment, we believe that growth in our existing business will be the more dominant factor as we open new communities in our current operations."

Beazer To Discontinue Reporting of Monthly New Orders

The Company also announced that, consistent with the practice of most other publicly-traded homebuilders, it will discontinue reporting new orders on a monthly basis. It will continue to report quarterly new orders soon after the end of each quarter.

Beazer Reiterates Target EPS of $12.25 Per Share for Fiscal 2003 Mr. McCarthy said, "As described in our recently issued Annual Report for 2002, we believe that there are a number of strong positive indicators of future growth for both Beazer and the overall US homebuilding industry. Over the past six years, net income for the top ten US homebuilders has increased consistently and dramatically, with a compound annual growth rate of well over 40%, in an environment where housing starts have averaged an annual increase of 2%. Our own performance during the December quarter, with net income up 59%, demonstrates the continuation of that trend. Three significant factors indicate that this trend should continue in the coming years: strong population growth fueled by immigration; a constrained supply of housing; and a dramatically consolidating industry."

Mr. McCarthy concluded, "Our performance during the December quarter, with earnings of $2.75 per share, gives us a strong start for fiscal 2003. With this performance we reiterate our EPS target of $12.25 for the full fiscal year, which represents a 14% increase over fiscal 2002. This target is based on 16,500 home closings with an average price in the low $190,000 range. It also assumes that the margin achieved in the December quarter, which was significantly higher than last year's gross margin, is sustained through the remainder of this fiscal year. We recognize that these targets are subject to economic fluctuations in the current uncertain macroeconomic environment, however we enter this year's spring selling season confident in our ability to take advantage of opportunities and adapt to economic changes."

Beazer Homes USA, Inc., based in Atlanta, Georgia, is one of the country's ten largest single-family homebuilders with operations in Arizona, California, Colorado, Delaware, Florida, Georgia, Indiana, Kentucky, Maryland, Mississippi, Nevada, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas and Virginia. Beazer Homes also provides mortgage origination and title services to its homebuyers.

                              BEAZER HOMES USA, INC.
                    CONSOLIDATED OPERATING AND FINANCIAL DATA
                 (Dollars in thousands, except per share amounts)

    FINANCIAL DATA
                                                          Quarter Ended
                                                           December 31,
                                                    2002             2001
    INCOME STATEMENT
    Revenues                                       $700,160          $489,717
    Costs and expenses:
        Home construction and land sales            551,817           392,305
        Interest                                     11,900             7,762
        Selling, general and
         administrative expense                      77,377            52,552
    Operating income                                 59,066            37,098
    Other income                                      1,959               854

    Income before income taxes                       61,025            37,952
    Income taxes                                     24,105            14,802
    Net income                                      $36,920           $23,150

    Net income per common share:
        Basic                                         $2.88             $2.76
        Diluted                                       $2.75             $2.47


    Weighted average shares outstanding,
     in thousands:
        Basic                                        12,811             8,402
        Diluted                                      13,424             9,363

    Interest incurred                               $16,582            $8,143
    Depreciation and amortization                    $2,731            $1,967



    SELECTED BALANCE SHEET DATA                           December 31,
                                                     2002               2001
    Cash                                            $80,830              $---
    Inventory                                     1,418,280           918,509
    Total assets                                  1,889,507         1,005,338
    Total debt                                      739,417           429,379
    Shareholders' equity                            837,516           375,361




                             BEAZER HOMES USA, INC.
              CONSOLIDATED OPERATING AND FINANCIAL DATA (Continued)
                             (Dollars in thousands)

     OPERATING DATA

                                                           Quarter Ended
                                                            December 31,
   SELECTED OPERATING DATA                             2002             2001
    Closings:
        Southeast region                               1,093              788
        West region                                    1,040              984
        Central region                                   266              235
        Mid-Atlantic region                              295              358
        Midwest region                                   788              ---
    Total closings                                     3,482            2,365
    New orders, net of cancellations:
        Southeast region                               1,015              953
        West region                                      939              973
        Central region                                   232              232
        Mid-Atlantic region                              452              352
        Midwest region                                   503              ---
    Total new orders                                   3,141            2,510
    Backlog at end of period                           6,178            4,122
    Dollar value of backlog at end of period      $1,234,479         $814,684
    Active subdivisions:
        Southeast region                                 179              133
        West region                                       84               81
        Central region                                    31               32
        Mid-Atlantic region                               39               41
        Midwest region                                   135              ---
    Total active subdivisions                            468              287





                             BEAZER HOMES USA, INC.
              CONSOLIDATED OPERATING AND FINANCIAL DATA (Continued)
                             (Dollars in thousands)

                                                          Quarter Ended
                                                           December 31,
     SUPPLEMENTAL FINANCIAL DATA:                      2002              2001

    Revenues
        Home sales                                 $688,770          $482,036
        Land and lot sales                            2,495             2,624
        Mortgage origination revenue                 12,484             7,509
        Intercompany elimination - mortgage          (3,589)           (2,452)
    Total revenues                                 $700,160          $489,717
    Cost of home construction and land sales
        Home sales                                 $553,464          $393,181
        Land and lot sales                            1,942             1,576
        Intercompany elimination - mortgage          (3,589)           (2,452)
    Total costs of home construction and
     land sales                                    $551,817          $392,305
    Selling, general and administrative
        Homebuilding operations                     $70,516           $48,360
        Mortgage origination operations               6,861             4,192
    Total selling, general and administrative       $77,377           $52,552

SOURCE Beazer Homes USA, Inc.

/CONTACT: David S. Weiss, Executive Vice President and Chief Financial Officer of Beazer Homes USA, Inc., +1-404-250-3420, or dweiss@beazer.com /