__________________________________________________________________________________________
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): January 28, 2013
BEAZER HOMES USA, INC.
(Exact name of registrant as specified in its charter)
DELAWARE | 001-12822 | 54-2086934 | ||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||
1000 Abernathy Road, Suite 260
Atlanta Georgia 30328
(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)) |
__________________________________________________________________________________________
Item 2.02. | Results of Operations and Financial Condition |
On January 28, 2013, Beazer Homes USA, Inc. issued a press release announcing results of operations for the three months ended December 31, 2012. A copy of the press release is attached hereto as exhibit 99.1.
Item 9.01 | Financial Statements and Exhibits |
(d) Exhibits
99.1 | Earnings Press Release dated January 28, 2013 |
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: January 28, 2013 | By: | /s/ Kenneth F. Khoury | ||||||
Kenneth F. Khoury Executive Vice President, Chief Administrative Officer and General Counsel | ||||||||
Exhibit 99.1
PRESS RELEASE
Beazer Homes Reports First Quarter Fiscal 2013 Results
ATLANTA, January 28, 2013 - Beazer Homes USA, Inc. (NYSE: BZH) (www.beazer.com) today announced its financial results for the quarter ended December 31, 2012.
“In the first quarter we achieved improvements in nearly every operational and financial metric compared to last year, including new orders, closings and adjusted EBITDA,” said Allan Merrill, President and CEO of Beazer Homes. “Additionally we saw higher home sales prices and lower cancellation rates as most of our geographic markets continued to demonstrate signs of improvement. We remain committed to our path-to-profitability strategies, which are designed to enable us to return to sustained profitability as soon as possible.”
On trends in the housing market, Mr. Merrill commented, “While there are still challenges to overcome before the
industry can achieve a full turnaround, we believe that improvements in consumer confidence coupled with low
mortgage rates and enhanced clarity regarding mortgage qualification procedures should provide support for both
increased demand for new homes and improved new home pricing during the balance of the year.”
Summary results for the quarter ended December 31, 2012 are as follows (all per share amounts are calculated after giving effect to a 1-for-5 reverse stock split completed on October 12, 2012):
Q1 Results from Continuing Operations (unless otherwise specified)
Quarter Ended December 31, | ||||||||||||
2012 | 2011 | Change | ||||||||||
New Home Orders | 932 | 724 | 28.7 | % | ||||||||
LTM orders per month per community | 2.5 | 1.9 | 31.6 | % | ||||||||
Cancellation rates | 26.4 | % | 35.1 | % | -730 bps | |||||||
Total Home Closings | 1,038 | 867 | 19.7 | % | ||||||||
Average sales price from closings (in thousands) | $ | 235.5 | $ | 215.5 | 9.3 | % | ||||||
Homebuilding revenue (in millions) | $ | 244.4 | $ | 186.9 | 30.8 | % | ||||||
Homebuilding gross profit margin, excluding impairments and abandonments (I&A) (a) | 14.7 | % | 13.3 | % | 140 bps | |||||||
Homebuilding gross profit margin, excluding I&A and interest amortized to cost of sales (a) | 18.1 | % | 20.2 | % | -210 bps | |||||||
Loss from continuing operations before income taxes (in millions) | $ | (19.2 | ) | $ | (35.0 | ) | $ | 15.8 | ||||
Net (loss) income from continuing operations (in millions) | $ | (18.9 | ) | $ | 0.7 | $ | (19.6 | ) | ||||
Basic Per Share | $ | (0.78 | ) | $ | 0.05 | $ | (0.83 | ) | ||||
Inventory impairments (in millions) | $ | (0.2 | ) | $ | (3.5 | ) | $ | 3.3 | ||||
Net (loss) income from continuing operations excluding inventory impairments (in millions) | $ | (18.7 | ) | $ | 4.2 | $ | (22.9 | ) | ||||
Land and land development spending (in millions) | $ | 90.0 | $ | 58.2 | $ | 31.8 | ||||||
Adjusted EBITDA (in millions) | $ | 7.7 | $ | 3.8 | $ | 3.9 | ||||||
(a) Homebuilding gross profit for the quarter ended December 31, 2011 includes an $11.0 million warranty recovery which contributed 590 bps to the margin
As of December 31, 2012
• | Total cash and cash equivalents: $648.2 million, including unrestricted cash of approximately $396.7 million |
• | Stockholders' equity: $242.6 million, not including $9.4 million of mandatory convertible subordinated notes, which converted to 408,790 shares of common stock at maturity on January 15, 2013 |
• | Total backlog from continuing operations: 1,817 homes with a sales value of $478.3 million, compared to 1,307 homes with a sales value of $315.8 million as of December 31, 2011 |
• | Land and lots controlled: 25,104 lots (82.0% owned), a decrease of 3.4% from December 31, 2011 |
Conference Call
The Company will hold a conference call on January 31, 2013 at 9:30 am EST to discuss these results. Interested parties may listen to the conference call and view the Company's slide presentation over the internet by visiting the “Investor Relations” section of the Company's website at www.beazer.com. To access the conference call by telephone, listeners should dial 800-619-8639 or 312-470-7002. To be admitted to the call, verbally supply the passcode "BZH". A replay of the call will be available shortly after the conclusion of the live call. To access the replay, dial 866-429-0570 or 203-369-0912 and enter the passcode “3740” (available until 9:30 pm ET on February 7, 2013), or visit www.beazer.com. A replay of the webcast will be available at www.beazer.com for approximately 30 days.
Headquartered in Atlanta, Beazer Homes is one of the country's 10 largest single-family homebuilders. The Company's homes meet or exceed the benchmark for energy-efficient home construction as established by ENERGY STAR® and are designed with flexible floorplan options to meet the personal preferences and lifestyles of its buyers. In addition, the Company is committed to providing a range of preferred lender choices to facilitate transparent competition between lenders and enhanced customer service. The Company offers homes in 16 states, including Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas and Virginia. Beazer Homes is listed on the New York Stock Exchange under the ticker symbol “BZH.” For more info visit Beazer.com, or check out Beazer on Facebook 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, (i) economic changes nationally or in local markets, including changes in consumer confidence, changes in the level of housing starts, declines in employment levels, inflation and changes in the demand and prices of new homes and resale homes in the market; (ii) a slower economic rebound than anticipated, coupled with persistently high unemployment and additional foreclosures; (iii) estimates related to homes to be delivered in the future (backlog) are imprecise as they are subject to various cancellation risks which cannot be fully controlled; (iv) a substantial increase in mortgage interest rates, increased disruption in the availability of mortgage financing or a change in tax laws regarding the deductibility of mortgage interest; (v) factors affecting margins such as decreased land values underlying lot option agreements, increased land development costs on communities under development or delays or difficulties in implementing initiatives to reduce production and overhead cost structure; (vi) the final outcome of various putative class action lawsuits, multi-party suits and similar proceedings as well as the results of any other litigation or government proceedings and fulfillment of the obligations in the Deferred Prosecution Agreement and consent orders with governmental authorities and other settlement agreements; (vii) our cost of and ability to access capital 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; (viii) our ability to comply with covenants in our debt agreements or satisfy such obligations through repayment or refinancing; (ix) estimates related to the potential recoverability of our deferred tax assets; (x) increased competition or delays in reacting to changing consumer preference in home design; (xi) shortages of or increased prices for labor, land or raw materials used in housing production; (xii) additional asset impairment charges or writedowns; (xiii) the impact of construction defect and home warranty claims; (xiv)the cost and availability of insurance and surety bonds; (xv) delays in land development or home construction resulting from adverse weather conditions; (xvi) potential delays or increased costs
in obtaining necessary permits and possible penalties for failure to comply with laws, regulations and governmental policies; (xvii) the performance of our joint ventures and our joint venture partners; (xviii) potential exposure related to additional repurchase claims on mortgages and loans originated by Beazer Mortgage Corp.; (xix) effects of changes in accounting policies, standards, guidelines or principles; or (xx) terrorist acts, acts of war and other factors over which the Company has little or no control. Any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by law, we do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time and it is not possible for management to predict all such factors.
CONTACT: Beazer Homes USA, Inc.
Carey Phelps
Director, Investor Relations & Corporate Communications
770-829-3700
investor.relations@beazer.com
-Tables Follow-
BEAZER HOMES USA, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
Three Months Ended | |||||||
December 31, | |||||||
2012 | 2011 | ||||||
Total revenue | $ | 246,902 | $ | 188,548 | |||
Home construction and land sales expenses | 210,614 | 162,776 | |||||
Inventory impairments and option contract abandonments | 204 | 3,503 | |||||
Gross profit | 36,084 | 22,269 | |||||
Commissions | 10,642 | 8,371 | |||||
General and administrative expenses | 26,328 | 28,194 | |||||
Depreciation and amortization | 2,715 | 2,403 | |||||
Operating loss | (3,601 | ) | (16,699 | ) | |||
Equity in income (loss) of unconsolidated entities | 36 | (77 | ) | ||||
Other expense, net | (15,627 | ) | (18,273 | ) | |||
Loss from continuing operations before income taxes | (19,192 | ) | (35,049 | ) | |||
Benefit from income taxes | (253 | ) | (35,747 | ) | |||
(Loss) income from continuing operations | (18,939 | ) | 698 | ||||
(Loss) income from discontinued operations, net of tax | (1,449 | ) | 41 | ||||
Net (loss) income | $ | (20,388 | ) | $ | 739 | ||
Weighted average number of shares: | |||||||
Basic | 24,294 | 14,833 | |||||
Diluted | 24,294 | 17,421 | |||||
(Loss) earnings per share: | |||||||
Basic (loss) earnings per share from continuing operations | $ | (0.78 | ) | $ | 0.05 | ||
Basic (loss) earnings per share from discontinued operations | $ | (0.06 | ) | $ | — | ||
Basic (loss) earnings per share | $ | (0.84 | ) | $ | 0.05 | ||
Diluted (loss) earnings per share from continuing operations | $ | (0.78 | ) | $ | 0.04 | ||
Diluted (loss) earnings per share from discontinued operations | $ | (0.06 | ) | $ | — | ||
Diluted (loss) earnings per share | $ | (0.84 | ) | $ | 0.04 | ||
Three Months Ended | |||||||
December 31, | |||||||
2012 | 2011 | ||||||
Capitalized interest in inventory, beginning of period | $ | 38,190 | $ | 45,973 | |||
Interest incurred | 28,418 | 32,525 | |||||
Capitalized interest impaired | — | (28 | ) | ||||
Interest expense not qualified for capitalization and included as other expense | (16,211 | ) | (19,117 | ) | |||
Capitalized interest amortized to house construction and land sales expenses | (8,475 | ) | (12,843 | ) | |||
Capitalized interest in inventory, end of period | $ | 41,922 | $ | 46,510 | |||
BEAZER HOMES USA, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
December 31, 2012 | September 30, 2012 | |||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 396,696 | $ | 487,795 | ||||
Restricted cash | 251,455 | 253,260 | ||||||
Accounts receivable (net of allowance of $2,184 and $2,235, respectively) | 23,484 | 24,599 | ||||||
Income tax receivable | 2,513 | 6,372 | ||||||
Inventory | ||||||||
Owned inventory | 1,141,691 | 1,099,132 | ||||||
Land not owned under option agreements | 9,205 | 12,420 | ||||||
Total inventory | 1,150,896 | 1,111,552 | ||||||
Investments in unconsolidated entities | 42,029 | 42,078 | ||||||
Deferred tax assets, net | 6,924 | 6,848 | ||||||
Property, plant and equipment, net | 18,054 | 18,974 | ||||||
Other assets | 29,473 | 30,740 | ||||||
Total assets | $ | 1,921,524 | $ | 1,982,218 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Trade accounts payable | $ | 56,062 | $ | 69,268 | ||||
Other liabilities | 122,269 | 147,718 | ||||||
Obligations related to land not owned under option agreements | 3,625 | 4,787 | ||||||
Total debt (net of discounts of $2,944 and $3,082, respectively) | 1,496,951 | 1,498,198 | ||||||
Total liabilities | $ | 1,678,907 | $ | 1,719,971 | ||||
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, 100,000,000 shares authorized, 24,690,033 and 24,601,830 issued and outstanding, respectively) | 25 | 25 | ||||||
Paid-in capital | 834,752 | 833,994 | ||||||
Accumulated deficit | (592,160 | ) | (571,772 | ) | ||||
Total stockholders’ equity | 242,617 | 262,247 | ||||||
Total liabilities and stockholders’ equity | $ | 1,921,524 | $ | 1,982,218 | ||||
Inventory Breakdown | ||||||||
Homes under construction | $ | 261,062 | $ | 251,828 | ||||
Development projects in progress | 422,262 | 391,019 | ||||||
Land held for future development | 367,245 | 367,102 | ||||||
Land held for sale | 8,576 | 10,149 | ||||||
Capitalized interest | 41,922 | 38,190 | ||||||
Model homes | 40,624 | 40,844 | ||||||
Land not owned under option agreements | 9,205 | 12,420 | ||||||
Total inventory | $ | 1,150,896 | $ | 1,111,552 | ||||
BEAZER HOMES USA, INC.
CONSOLIDATED OPERATING AND FINANCIAL DATA – CONTINUING OPERATIONS
Quarter Ended December 31, | ||||||||
SELECTED OPERATING DATA | 2012 | 2011 | ||||||
Closings: | ||||||||
West region | 499 | 370 | ||||||
East region | 353 | 310 | ||||||
Southeast region | 186 | 187 | ||||||
Total closings | 1,038 | 867 | ||||||
New orders, net of cancellations: | ||||||||
West region | 424 | 303 | ||||||
East region | 309 | 249 | ||||||
Southeast region | 199 | 172 | ||||||
Total new orders | 932 | 724 | ||||||
Backlog units at end of period: | ||||||||
West region | 764 | 503 | ||||||
East region | 703 | 577 | ||||||
Southeast region | 350 | 227 | ||||||
Total backlog units | 1,817 | 1,307 | ||||||
Dollar value of backlog at end of period (in millions) | $ | 478.3 | $ | 315.8 | ||||
Homebuilding Revenue (in thousands): | ||||||||
West region | $ | 109,753 | $ | 70,254 | ||||
East region | 96,464 | 81,767 | ||||||
Southeast region | 38,208 | 34,831 | ||||||
Total homebuilding revenue | $ | 244,425 | $ | 186,852 | ||||
Quarter Ended December 31, | ||||||||
SUPPLEMENTAL FINANCIAL DATA | 2012 | 2011 | ||||||
Revenues: | ||||||||
Homebuilding | $ | 244,425 | $ | 186,852 | ||||
Land sales and other | 2,477 | 1,696 | ||||||
Total | $ | 246,902 | $ | 188,548 | ||||
Gross profit: | ||||||||
Homebuilding | $ | 35,630 | $ | 21,352 | ||||
Land sales and other | 454 | 917 | ||||||
Total | $ | 36,084 | $ | 22,269 | ||||
Reconciliation of homebuilding gross profit before impairments and abandonments and interest amortized to cost of sales and the related gross margins 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. Homebuilding gross profit for the quarter ended December 31, 2011 included a $11.0 million warranty recovery which added 590 basis points to homebuilding gross profit before I&A and interest amortized to cost of sales.
Quarter Ended December 31, | |||||||||||
2012 | 2011 | ||||||||||
Homebuilding gross profit | $ | 35,630 | 14.6 | % | $ | 21,352 | 11.4 | % | |||
Inventory impairments and lot option abandonments (I&A) | 204 | 3,503 | |||||||||
Homebuilding gross profit before I&A | 35,834 | 14.7 | % | 24,855 | 13.3 | % | |||||
Interest amortized to cost of sales | 8,475 | 12,843 | |||||||||
Homebuilding gross profit before I&A and interest amortized to cost of sales | $ | 44,309 | 18.1 | % | $ | 37,698 | 20.2 | % | |||
Reconciliation of Adjusted EBITDA (earnings before interest, taxes, depreciation, amortization and impairments) to total company net income (loss) (including discontinued operations), 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.
Quarter Ended December 31, | ||||||||
2012 | 2011 | |||||||
Net (loss) income | $ | (20,388 | ) | $ | 739 | |||
Benefit from income taxes | (275 | ) | (36,146 | ) | ||||
Interest amortized to home construction and land sales expenses, capitalized interest impaired, and interest expense not qualified for capitalization | 24,686 | 31,988 | ||||||
Depreciation and amortization and stock compensation amortization | 3,499 | 3,703 | ||||||
Inventory impairments and option contract abandonments | 221 | 3,507 | ||||||
Joint venture impairment and abandonment charges | — | 29 | ||||||
Adjusted EBITDA | $ | 7,743 | $ | 3,820 | ||||