Beazer Homes Reports Significant Growth in Profitability
“Our fourth quarter results contributed to an exceptionally productive
year for the Company,” said
“Looking into Fiscal 2018, we expect additional growth in profitability, likely culminating in the achievement of our ‘2B-10’ goals, further expansion of our Gatherings business, and the completion of our multi-year debt reduction program.”
-
Net income from continuing operations of
$32.0 million -
Adjusted EBITDA of
$178.8 million , up 14.4% -
Homebuilding revenue of
$1.9 billion , up 6.2% - 5,525 new home deliveries, up 2.0%
-
Average selling price of
$343.1 thousand , up 4.2% - Homebuilding gross margin was 16.5%. Excluding impairments, abandonments, amortized interest, unexpected warranty costs and additional insurance recoveries, homebuilding gross margin was 21.2%, up 60 basis points
-
SG&A as a percentage of total revenue was 12.2%, down 10 basis points.
This excludes a
$2.7 million charge related to the write-off of a legacy investment in the first quarter of Fiscal 2017 - Unit orders of 5,464, up 3.2%. Average community count was 155, down 6.7%
-
Dollar value of backlog of
$665.8 million , up 2.0%
Beazer Homes Fiscal Fourth Quarter 2017 Highlights and Comparison to Fiscal Fourth Quarter 2016
-
Net income from continuing operations of
$33.7 million -
Adjusted EBITDA of
$76.9 million , up 16.6% -
Homebuilding revenue of
$665.5 million , up 7.3% - 1,904 new home deliveries, up 2.6%
-
Average selling price of
$349.5 thousand , up 4.6% - Homebuilding gross margin was 17.0%. Excluding impairments, abandonments and amortized interest, homebuilding gross margin was 22.0%, up 120 basis points
- SG&A as a percentage of total revenue was 10.5%, down 10 basis points
- Unit orders of 1,315, down 2.3%. Average community count was 154, down 4.9%
-
Unrestricted cash at quarter end was
$292.1 million
Orders. Net new orders for the fourth quarter decreased 2.3% versus the prior year. This slight decline was anticipated, as several markets were negatively impacted by Hurricanes Harvey and Irma during the closing weeks of the fiscal year. Even with the impact from these storms, the Company generated an absorption rate of 2.85 sales per community per month, up 2.8% from the previous year. This partially offset a 4.9% year over year decline in the average community count to 154 communities. The cancellation rate was 20.6%, relatively flat compared to the fourth quarter of last year and in line with historical levels.
Homebuilding Revenue. Homebuilding revenue for the fourth quarter
increased 7.3% over the prior year to
Backlog. The dollar value of homes in backlog as of
Homebuilding Gross Margin. Homebuilding gross margin for the fourth quarter was 17.0%. Excluding impairments, abandonments and amortized interest, homebuilding gross margin was 22.0%, up 120 basis points versus the prior year. The fourth quarter gross margin benefited from a number of one-time items, which added approximately 70 basis points to our overall margin improvement.
SG&A Expenses. Selling, general and administrative expenses,
as a percentage of total revenue, were 10.5%, down 10 basis points
versus the prior year. The improvement in operating leverage was
attributable to both the strong top line growth achieved and a continued
focus on overhead cost management. For the full year, SG&A as a
percentage of total revenue was 12.2%. This excludes a
Taxes. The Company’s fourth quarter income tax provision included
non-cash benefits of approximately
Liquidity. The Company ended the quarter with approximately
Capital Markets. On
Gatherings
During the fourth quarter, the Company approved its second Gatherings
community in the
Summary results for the three and twelve months ended
|
Q4 Results from Continuing Operations |
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| Quarter Ended September 30, | |||||||||||||||
| 2017 | 2016 | Change* | |||||||||||||
| New home orders, net of cancellations | 1,315 | 1,346 | (2.3 | )% | |||||||||||
| Orders per community per month | 2.85 | 2.77 | 2.8 | % | |||||||||||
| Average active community count | 154 | 162 | (4.9 | )% | |||||||||||
| Actual community count at quarter-end | 155 | 161 | (3.7 | )% | |||||||||||
| Cancellation rates | 20.6 | % | 20.4 | % | 20 bps | ||||||||||
| Total home closings | 1,904 | 1,856 | 2.6 | % | |||||||||||
| Average selling price (ASP) from closings (in thousands) | $ | 349.5 | $ | 334.0 | 4.6 | % | |||||||||
| Homebuilding revenue (in millions) | $ | 665.5 | $ | 620.0 | 7.3 | % | |||||||||
| Homebuilding gross margin | 17.0 | % | 16.2 | % | 80 bps | ||||||||||
| Homebuilding gross margin, excluding impairments and abandonments (I&A) | 17.2 | % | 16.2 | % | 100 bps | ||||||||||
| Homebuilding gross margin, excluding I&A and interest amortized to cost of sales | 22.0 | % | 20.8 | % | 120 bps | ||||||||||
| Income from continuing operations before income taxes (in millions) | $ | 37.7 | $ | 13.6 | $ | 24.0 | |||||||||
| Expense from income taxes (in millions) | $ | 4.0 | $ | 14.4 | $ | (10.5 | ) | ||||||||
| Income (loss) from continuing operations (in millions) | $ | 33.7 | $ | (0.8 | ) | $ | 34.5 | ||||||||
| Basic income (loss) per share from continuing operations | $ | 1.05 | $ | (0.03 | ) | $ | 1.08 | ||||||||
| Diluted income (loss) per share from continuing operations | $ | 1.03 | $ | (0.03 | ) | $ | 1.06 | ||||||||
| Income from continuing operations before income taxes (in millions) | $ | 37.7 | $ | 13.6 | $ | 24.0 | |||||||||
| Gain (loss) on debt extinguishment (in millions) | $ | 2.9 | $ | (11.4 | ) | $ | 14.3 | ||||||||
| Inventory impairments and abandonments (in millions) | $ | 1.7 | $ | 0.2 | $ | 1.5 | |||||||||
| Income from continuing operations excluding gain on debt extinguishment and inventory impairments and abandonments before income taxes (in millions) | $ | 36.5 | $ | 25.2 | $ | 11.3 | |||||||||
| Net income (loss) | $ | 33.7 | $ | (0.9 | ) | $ | 34.5 | ||||||||
| Land and land development spending (in millions) | $ | 136.4 | $ | 69.0 | $ | 67.4 | |||||||||
| Adjusted EBITDA (in millions) | $ | 76.9 | $ | 66.0 | $ | 10.9 | |||||||||
|
* Change and totals are calculated using unrounded numbers. |
|||||||||||||||
|
Fiscal Year Results from Continuing Operations |
|||||||||||||||
| Year Ended September 30, | |||||||||||||||
| 2017 | 2016 | Change* | |||||||||||||
| New home orders, net of cancellations | 5,464 | 5,297 | 3.2 | % | |||||||||||
| Orders per community per month | 2.94 | 2.66 | 10.5 | % | |||||||||||
| Cancellation rates | 18.5 | % | 20.4 | % | -190 bps | ||||||||||
| Total home closings | 5,525 | 5,419 | 2.0 | % | |||||||||||
| ASP from closings (in thousands) | $ | 343.1 | $ | 329.4 | 4.2 | % | |||||||||
| Homebuilding revenue (in millions) | $ | 1,895.9 | $ | 1,784.8 | 6.2 | % | |||||||||
| Homebuilding gross margin | 16.5 | % | 16.5 | % | 0 bps | ||||||||||
| Homebuilding gross margin, excluding I&A | 16.6 | % | 17.3 | % | -70 bps | ||||||||||
| Homebuilding gross margin, excluding I&A and interest amortized to cost of sales | 21.2 | % | 21.6 | % | -40 bps | ||||||||||
| Homebuilding gross margin, excluding I&A, interest amortized to cost of sales, unexpected warranty costs and additional insurance recoveries from a third-party insurer | 21.2 | % | 20.6 | % | 60 bps | ||||||||||
| Income from continuing operations before income taxes (in millions) | $ | 34.6 | $ | 21.7 | $ | 12.9 | |||||||||
| Expense from income taxes (in millions) | $ | 2.7 | $ | 16.5 | $ | (13.8 | ) | ||||||||
| Income from continuing operations (in millions) | $ | 32.0 | $ | 5.2 | $ | 26.7 | |||||||||
| Basic income per share from continuing operations | $ | 1.00 | $ | 0.16 | $ | 0.84 | |||||||||
| Diluted income per share from continuing operations | $ | 0.99 | $ | 0.16 | $ | 0.83 | |||||||||
| Income from continuing operations before income taxes (in millions) | $ | 34.6 | $ | 21.7 | $ | 12.9 | |||||||||
| Loss on debt extinguishment (in millions) | $ | 12.6 | $ | 13.4 | $ | (0.8 | ) | ||||||||
| Inventory impairments and abandonments (in millions) | $ | 2.4 | $ | 15.3 | $ | (12.8 | ) | ||||||||
| Unexpected warranty costs related to Florida stucco issues, net of recoveries (in millions) | $ | — | $ | 3.6 | $ | (3.6 | ) | ||||||||
| Additional insurance recoveries from a third-party insurer (in millions) | $ | — | $ | 15.5 | $ | (15.5 | ) | ||||||||
| Write-off of deposit on legacy land investment | $ | 2.7 | $ | — | $ | 2.7 | |||||||||
| Income from continuing operations excluding loss on debt extinguishment, inventory impairments and abandonments, unexpected warranty costs (net of recoveries), additional insurance recoveries and write-off of deposit before income taxes (in millions) | $ | 52.3 | $ | 31.3 | $ | 21.0 | |||||||||
| Net income | $ | 31.8 | $ | 4.7 | $ | 27.1 | |||||||||
|
|
|||||||||||||||
| Land and land development spending (in millions) | $ | 446.4 | $ | 336.9 | $ | 109.5 | |||||||||
| Adjusted EBITDA (in millions) | $ | 178.8 | $ | 156.3 | $ | 22.5 | |||||||||
|
* Change and totals are calculated using unrounded numbers. |
|||||||||||||||
| As of September 30, | |||||||||||||||
| 2017 | 2016 | Change | |||||||||||||
| Backlog units | 1,855 | 1,916 | (3.2 | )% | |||||||||||
| Dollar value of backlog (in millions) | $ | 665.8 | $ | 652.7 | 2.0 | % | |||||||||
| ASP in backlog (in thousands) | $ | 358.9 | $ | 340.6 | 5.4 | % | |||||||||
| Land and lots controlled | 21,507 | 23,356 | (7.9 | )% | |||||||||||
Conference Call
The Company will hold a conference call on
Headquartered in
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: (i) economic changes
nationally or in local markets, changes in consumer confidence, declines
in employment levels, inflation or increases in the quantity and
decreases in the price of new homes and resale homes on the market; (ii)
the cyclical nature of the homebuilding industry and a potential
deterioration in homebuilding industry conditions; (iii) factors
affecting margins, such as decreased land values underlying land option
agreements, increased land development costs on communities under
development or delays or difficulties in implementing initiatives to
reduce our production and overhead cost structure; (iv) the availability
and cost of land and the risks associated with the future value of our
inventory, such as additional asset impairment charges or writedowns;
(v) shortages of or increased prices for labor, land or raw materials
used in housing production, and the level of quality and craftsmanship
provided by our subcontractors; (vi) estimates related to homes to be
delivered in the future (backlog) are imprecise, as they are subject to
various cancellation risks that cannot be fully controlled; (vii) a
substantial increase in mortgage interest rates, increased disruption in
the availability of mortgage financing, a change in tax laws regarding
the deductibility of mortgage interest for tax purposes or an increased
number of foreclosures; (viii) our cost of and ability to access
capital, due to factors such as limitations in the capital markets or
adverse credit market conditions, and otherwise meet our ongoing
liquidity needs, including the impact of any downgrades of our credit
ratings or reductions in our tangible net worth or liquidity levels;
(ix) our ability to reduce our outstanding indebtedness and to comply
with covenants in our debt agreements or satisfy such obligations
through repayment or refinancing; (x) increased competition or delays in
reacting to changing consumer preferences in home design; (xi) weather
conditions 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; (xii) estimates related to the potential
recoverability of our deferred tax assets, and a potential reduction in
corporate tax rates that could reduce the usefulness of our existing
deferred tax assets; (xiii) 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; (xiv) the results
of litigation or government proceedings and fulfillment of any related
obligations; (xv) the impact of construction defect and home warranty
claims, including water intrusion issues in
Any forward-looking statement 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 for management to predict all such factors.
-Tables Follow-
|
BEAZER HOMES USA, INC. CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data) |
||||||||||||||||||||
| Three Months Ended | Fiscal Year Ended | |||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||||||
| Total revenue | $ | 672,981 | $ | 632,121 | $ | 1,916,278 | $ | 1,822,114 | ||||||||||||
| Home construction and land sales expenses | 557,928 | 529,531 | 1,600,969 | 1,509,625 | ||||||||||||||||
| Inventory impairments and abandonments | 1,693 | 184 | 2,445 | 15,282 | ||||||||||||||||
| Gross profit | 113,360 | 102,406 | 312,864 | 297,207 | ||||||||||||||||
| Commissions | 26,083 | 24,604 | 74,811 | 70,460 | ||||||||||||||||
| General and administrative expenses | 44,624 | 42,604 | 161,906 | 153,628 | ||||||||||||||||
| Depreciation and amortization | 4,870 | 4,360 | 14,009 | 13,794 | ||||||||||||||||
| Operating income | 37,783 | 30,838 | 62,138 | 59,325 | ||||||||||||||||
| Equity in income of unconsolidated entities | 158 | 60 | 371 | 131 | ||||||||||||||||
| Loss on extinguishment of debt | 2,933 | (11,393 | ) | (12,630 | ) | (13,423 | ) | |||||||||||||
| Other expense, net | (3,223 | ) | (5,863 | ) | (15,230 | ) | (24,330 | ) | ||||||||||||
| Income from continuing operations before income taxes | 37,651 | 13,642 | 34,649 | 21,703 | ||||||||||||||||
| Expense from income taxes | 3,958 | 14,431 | 2,696 | 16,498 | ||||||||||||||||
| Income (loss) from continuing operations | 33,693 | (789 | ) | 31,953 | 5,205 | |||||||||||||||
| Loss from discontinued operations, net of tax | (39 | ) | (65 | ) | (140 | ) | (512 | ) | ||||||||||||
| Net income (loss) | $ | 33,654 | $ | (854 | ) | $ | 31,813 | $ | 4,693 | |||||||||||
| Weighted average number of shares: | ||||||||||||||||||||
| Basic | 31,974 | 31,815 | 31,952 | 31,798 | ||||||||||||||||
| Diluted | 32,576 | 31,815 | 32,426 | 31,803 | ||||||||||||||||
| Basic income (loss) per share: | ||||||||||||||||||||
| Continuing operations | $ | 1.05 | $ | (0.03 | ) | $ | 1.00 | $ | 0.16 | |||||||||||
| Discontinued operations | $ | — | $ | — | $ | — | $ | (0.01 | ) | |||||||||||
| Total | $ | 1.05 | $ | (0.03 | ) | $ | 1.00 | $ | 0.15 | |||||||||||
| Diluted income (loss) per share: | ||||||||||||||||||||
| Continuing operations | $ | 1.03 | $ | (0.03 | ) | $ | 0.99 | $ | 0.16 | |||||||||||
| Discontinued operations | $ | — | $ | — | $ | — | $ | (0.01 | ) | |||||||||||
| Total | $ | 1.03 | $ | (0.03 | ) | $ | 0.99 | $ | 0.15 | |||||||||||
| Three Months Ended | Fiscal Year Ended | |||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||
| Capitalized Interest in Inventory | 2017 | 2016 | 2017 | 2016 | ||||||||||||||||
| Capitalized interest in inventory, beginning of period | $ | 148,329 | $ | 142,398 | $ | 138,108 | $ | 123,457 | ||||||||||||
| Interest incurred | 25,739 | 30,047 | 105,551 | 119,360 | ||||||||||||||||
| Capitalized interest impaired | (56 | ) | — | (56 | ) | (710 | ) | |||||||||||||
| Interest expense not qualified for capitalization and included as other expense | (3,404 | ) | (5,917 | ) | (15,636 | ) | (25,388 | ) | ||||||||||||
| Capitalized interest amortized to home construction and land sales expenses | (31,405 | ) | (28,420 | ) | (88,764 | ) | (78,611 | ) | ||||||||||||
| Capitalized interest in inventory, end of period | $ | 139,203 | $ | 138,108 | $ | 139,203 | $ | 138,108 | ||||||||||||
|
BEAZER HOMES USA, INC. CONSOLIDATED BALANCE SHEETS (In thousands, except share and per share data) |
||||||||||
| September 30, 2017 | September 30, 2016 | |||||||||
| ASSETS | ||||||||||
| Cash and cash equivalents | $ | 292,147 | $ | 228,871 | ||||||
| Restricted cash | 12,462 | 14,405 | ||||||||
| Accounts receivable (net of allowance of $330 and $354, respectively) | 36,323 | 53,226 | ||||||||
| Income tax receivable | 88 | 292 | ||||||||
| Owned inventory | 1,542,807 | 1,569,279 | ||||||||
| Investments in unconsolidated entities | 3,994 | 10,470 | ||||||||
| Deferred tax assets, net | 307,896 | 309,955 | ||||||||
| Property and equipment, net | 17,566 | 19,138 | ||||||||
| Other assets | 7,712 | 7,522 | ||||||||
| Total assets | $ | 2,220,995 | $ | 2,213,158 | ||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
| Trade accounts payable | $ | 103,484 | $ | 104,174 | ||||||
| Other liabilities | 107,659 | 134,253 | ||||||||
| Total debt (net of premium of $3,413 and $2,362, respectively, and debt issuance costs of $14,800 and $15,514, respectively) | 1,327,412 | 1,331,878 | ||||||||
| Total liabilities | $ | 1,538,555 | $ | 1,570,305 | ||||||
| Stockholders’ equity: | ||||||||||
| Preferred stock (par value $.01 per share, 5,000,000 shares authorized, no shares issued) | $ | — | $ | — | ||||||
| Common stock (par value $0.001 per share, 63,000,000 shares authorized, 33,515,768 issued and outstanding and 33,071,331 issued and outstanding, respectively) | 34 | 33 | ||||||||
| Paid-in capital | 873,063 | 865,290 | ||||||||
| Accumulated deficit | (190,657 | ) | (222,470 | ) | ||||||
| Total stockholders’ equity | 682,440 | 642,853 | ||||||||
| Total liabilities and stockholders’ equity | $ | 2,220,995 | $ | 2,213,158 | ||||||
| Inventory Breakdown | ||||||||||
| Homes under construction | $ | 419,312 | $ | 377,191 | ||||||
| Development projects in progress | 785,777 | 742,417 | ||||||||
| Land held for future development | 112,565 | 213,006 | ||||||||
| Land held for sale | 17,759 | 29,696 | ||||||||
| Capitalized interest | 139,203 | 138,108 | ||||||||
| Model homes | 68,191 | 68,861 | ||||||||
| Total owned inventory | $ | 1,542,807 | $ | 1,569,279 | ||||||
|
BEAZER HOMES USA, INC. CONSOLIDATED OPERATING AND FINANCIAL DATA – CONTINUING OPERATIONS |
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| Quarter Ended September 30, | Fiscal Year Ended September 30, | |||||||||||||||
| SELECTED OPERATING DATA | 2017 | 2016 | 2017 | 2016 | ||||||||||||
| Closings: | ||||||||||||||||
| West region | 832 | 842 | 2,527 | 2,508 | ||||||||||||
| East region | 533 | 466 | 1,382 | 1,373 | ||||||||||||
| Southeast region | 539 | 548 | 1,616 | 1,538 | ||||||||||||
| Total closings | 1,904 | 1,856 | 5,525 | 5,419 | ||||||||||||
| New orders, net of cancellations: | ||||||||||||||||
| West region | 637 | 561 | 2,578 | 2,381 | ||||||||||||
| East region | 324 | 348 | 1,351 | 1,330 | ||||||||||||
| Southeast region | 354 | 437 | 1,535 | 1,586 | ||||||||||||
| Total new orders, net | 1,315 | 1,346 | 5,464 | 5,297 | ||||||||||||
| Fiscal Year Ended September 30, | ||||||||||||||||
| Backlog units at end of period: | 2017 | 2016 | ||||||||||||||
| West region | 879 | 828 | ||||||||||||||
| East region | 413 | 444 | ||||||||||||||
| Southeast region | 563 | 644 | ||||||||||||||
| Total backlog units | 1,855 | 1,916 | ||||||||||||||
| Dollar value of backlog at end of period (in millions) | $ | 665.8 | $ | 652.7 | ||||||||||||
| Quarter Ended September 30, | Fiscal Year Ended September 30, | |||||||||||||||
| SUPPLEMENTAL FINANCIAL DATA | 2017 | 2016 | 2017 | 2016 | ||||||||||||
| Homebuilding revenue: | ||||||||||||||||
| West region | $ | 286,564 | $ | 281,987 | $ | 851,472 | $ | 817,971 | ||||||||
| East region | 209,301 | 172,787 | 533,585 | 505,198 | ||||||||||||
| Southeast region | 169,594 | 165,178 | 510,798 | 461,608 | ||||||||||||
| Total homebuilding revenue | $ | 665,459 | $ | 619,952 | $ | 1,895,855 | $ | 1,784,777 | ||||||||
| Revenues: | ||||||||||||||||
| Homebuilding | $ | 665,459 | $ | 619,952 | $ | 1,895,855 | $ | 1,784,777 | ||||||||
| Land sales and other | 7,522 | 12,169 | 20,423 | 37,337 | ||||||||||||
| Total revenues | $ | 672,981 | $ | 632,121 | $ | 1,916,278 | $ | 1,822,114 | ||||||||
| Gross profit: | ||||||||||||||||
| Homebuilding | $ | 113,011 | $ | 100,719 | $ | 312,201 | $ | 293,860 | ||||||||
| Land sales and other | 349 | 1,687 | 663 | 3,347 | ||||||||||||
| Total gross profit | $ | 113,360 | $ | 102,406 | $ | 312,864 | $ | 297,207 | ||||||||
Reconciliation of homebuilding gross profit and the related gross margin before impairments and abandonments and interest amortized to cost of sales to homebuilding gross profit and gross margin, the most directly comparable GAAP measure, 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.
In addition, given the unusual size and nature of the charges recorded
related to the
| Quarter Ended September 30, | Fiscal Year Ended September 30, | ||||||||||||||||||||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||||||||||||||||||||
| Homebuilding gross profit/margin | $ | 113,011 | 17.0 | % | $ | 100,719 | 16.2 | % | $ | 312,201 | 16.5 | % | $ | 293,860 | 16.5 | % | |||||||||||||||||
| Inventory impairments and abandonments (I&A) | 1,693 | — | 1,881 | 14,512 | |||||||||||||||||||||||||||||
| Homebuilding gross profit/margin before I&A | 114,704 | 17.2 | % | 100,719 | 16.2 | % | 314,082 | 16.6 | % | 308,372 | 17.3 | % | |||||||||||||||||||||
| Interest amortized to cost of sales | 31,405 | 28,421 | 88,764 | 77,941 | |||||||||||||||||||||||||||||
| Homebuilding gross profit/margin before I&A and interest amortized to cost of sales | 146,109 | 22.0 | % | 129,140 | 20.8 | % | 402,846 | 21.2 | % | 386,313 | 21.6 | % | |||||||||||||||||||||
| Unexpected warranty costs related to Florida stucco issues (net of expected insurance recoveries) | — | — | — | (3,612 | ) | ||||||||||||||||||||||||||||
| Additional insurance recoveries from a third-party insurer | — | — | — | (15,500 | ) | ||||||||||||||||||||||||||||
| Homebuilding gross profit/margin before I&A, interest amortized to cost of sales, unexpected warranty costs and additional insurance recoveries from a third-party insurer | $ | 146,109 | 22.0 | % | $ | 129,140 | 20.8 | % | $ | 402,846 | 21.2 | % | $ | 367,201 | 20.6 | % | |||||||||||||||||
Reconciliation of Adjusted EBITDA to total company net income (loss), the most directly comparable GAAP measure, is provided for each period discussed below. Management believes that Adjusted EBITDA assists investors in understanding and comparing the operating characteristics of homebuilding activities by eliminating many of the differences in companies’ respective capitalization, tax position and level of impairments. These EBITDA measures should not be considered alternatives to net income determined in accordance with GAAP as an indicator of operating performance.
The reconciliation of Adjusted EBITDA to total company net income (loss) below differs from the prior year, as it provides a more simplified presentation of EBIT, EBITDA and Adjusted EBITDA that excludes certain non-recurring amounts recorded during the periods presented. Management believes that this presentation best reflects the operating characteristics of the Company.
|
Quarter Ended |
Fiscal Year Ended |
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| 2017 | 2016 | 2017 | 2016 | ||||||||||||||||
| Net income (loss) | $ | 33,654 | $ | (854 | ) | $ | 31,813 | $ | 4,693 | ||||||||||
| Expense from income taxes | 3,953 | 14,415 | 2,621 | 16,224 | |||||||||||||||
| Interest amortized to home construction and land sales expenses and capitalized interest impaired | 31,462 | 28,421 | 88,820 | 79,322 | |||||||||||||||
| Interest expense not qualified for capitalization | 3,404 | 5,917 | 15,636 | 25,388 | |||||||||||||||
| EBIT | 72,473 | 47,899 | 138,890 | 125,627 | |||||||||||||||
| Depreciation and amortization and stock compensation amortization | 5,702 | 6,474 | 22,173 | 21,752 | |||||||||||||||
| EBITDA | 78,175 | 54,373 | 161,063 | 147,379 | |||||||||||||||
| (Gain) loss on extinguishment of debt | (2,933 | ) | 11,393 | 12,630 | 13,423 | ||||||||||||||
| Inventory impairments and abandonments | 1,637 | 184 | 2,389 | 14,572 | |||||||||||||||
| Unexpected warranty costs related to Florida stucco issues (net of expected insurance recoveries) | — | — | — | (3,612 | ) | ||||||||||||||
| Additional insurance recoveries from third-party insurer | — | — | — | (15,500 | ) | ||||||||||||||
| Write-off of deposit on legacy land investment | — | — | 2,700 | — | |||||||||||||||
| Adjusted EBITDA | $ | 76,879 | $ | 65,950 | $ | 178,782 | $ | 156,262 | |||||||||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20171114006374/en/
Source:
Beazer Homes USA, Inc.
David I. Goldberg, 770-829-3700
Vice
President of Treasury and Investor Relations
investor.relations@beazer.com