BZH Beazer Homes USA Inc New

Beazer Homes USA, Inc. (NYSE: BZH) (www.beazer.com) today announced its financial results for the three and nine months ended June 30, 2024.

“Despite an affordability challenged new home sales environment and shifting consumer sentiment, we generated healthy results and continued to make progress towards our multi-year goals,” said Allan P. Merrill, the Company’s Chairman and Chief Executive Officer. “Revenue growth and cost control led to $53.5 million in Adjusted EBITDA and $0.88 of earnings per diluted share. We also repurchased approximately 450,000 shares of our common stock.”

Speaking to the Company’s multi-year goals, Mr. Merrill continued, “During the quarter we significantly increased our controlled lot position - primarily through options - providing clear visibility into our community count growth. Additionally, related to our Zero Energy Ready pledge, over 90% of our quarterly starts met this standard, and we reached the milestone of having certified more Zero Energy Ready homes to the DOE's Single Family National Program requirements than any builder in the country.”

Looking further out, Mr. Merrill concluded, "We're optimistic about the long-term prospects for the new home industry and Beazer in particular. With our experienced operating team, ample lot supply, healthy balance sheet, and industry-leading energy efficient homes, we're well-positioned to drive sustainable value for our shareholders in the years ahead.”

Beazer Homes Fiscal Third Quarter 2024 Highlights and Comparison to Fiscal Third Quarter 2023

• Net income from continuing operations was $27.2 million, or $0.88 per diluted share, compared to net income from continuing operations of $43.8 million, or $1.42 per diluted share, in fiscal third quarter 2023
• Adjusted EBITDA was $53.5 million, down 26.5%
• Homebuilding revenue was $589.6 million, up 3.3% on a 4.5% increase in home closings to 1,167, partially offset by a 1.1% decrease in average selling price (ASP) to $505.3 thousand
• Homebuilding gross margin was 17.3%, down 290 basis points compared to a year ago. Excluding impairments, abandonments and amortized interest, homebuilding gross margin was 20.3%, down 310 basis points
• SG&A as a percentage of total revenue was 11.9%, up 40 basis points
• Net new orders were 1,070, down 10.8% on a 23.9% decrease in orders per community per month to 2.4, partially offset by 17.2% increase in average community count to 146
• Backlog dollar value was $1.05 billion, up 3.6% on a 3.2% increase in ASP of homes in backlog to $536.9 thousand and a 0.4% increase in backlog units to 1,949
• Land acquisition and land development spending was $201.1 million, up 52.7% from $131.6 million
• Repurchased $12.9 million of the Company's outstanding common stock through open market transactions
• Unrestricted cash at quarter end was $73.2 million; total liquidity was $328.2 million
• Total debt to total capitalization ratio of 47.6% at quarter end compared to 48.4% a year ago. Net debt to net capitalization ratio of 45.8% at quarter end compared to 40.3% a year ago

The following provides additional details on the Company's performance during the fiscal third quarter 2024:

Profitability. Net income from continuing operations was $27.2 million, generating diluted earnings per share of $0.88. Third quarter adjusted EBITDA of $53.5 million was down $19.3 million, or 26.5%, primarily due to lower operating margin.

Orders. Net new orders for the third quarter decreased to 1,070, down 10.8% from 1,200 in the prior year quarter, primarily driven by a 23.9% decrease in sales pace to 2.4 orders per community per month, down from 3.2 in the prior year quarter, partially offset by a 17.2% increase in average community count to 146 from 124 a year ago. The cancellation rate for the quarter was 18.6%, up from 16.1% in the prior year quarter.

Backlog. The dollar value of homes in backlog as of June 30, 2024 was $1.05 billion, representing 1,949 homes, compared to $1.01 billion, representing 1,941 homes, at the same time last year. The ASP of homes in backlog was $536.9 thousand, up 3.2% versus the prior year quarter.

Homebuilding Revenue. Third quarter homebuilding revenue was $589.6 million, up 3.3% year-over-year. The increase in homebuilding revenue was driven by a 4.5% increase in home closings to 1,167 homes, partially offset by a 1.1% decrease in the ASP to $505.3 thousand. The increase in closings was primarily due to higher beginning backlog as well as improved construction cycle times.

Homebuilding Gross Margin. Homebuilding gross margin (excluding impairments, abandonments and amortized interest) was 20.3% for the third quarter, down from 23.4% in the prior year quarter as a result of increased share of speculative home closings which generally have lower margins than "to be built" homes, changes in product and community mix, and an increase in closing cost incentives.

SG&A Expenses. Selling, general and administrative expenses as a percentage of total revenue was 11.9% for the quarter, up 40 basis points year-over-year primarily due to higher commissions expense and higher sales and marketing costs as the Company prepares for new community activations.

Land Position. For the current fiscal quarter, land acquisition and land development spending was $201.1 million, up 52.7% year-over-year. Controlled lots increased 24.9% to 28,365, compared to 22,719 from the prior year quarter. Excluding land held for future development and land held for sale lots, active lots controlled were 27,822, up 26.1% year-over-year. As of June 30, 2024, the Company controlled 55.5% of its total active lots through option agreements compared to 52.2% as of June 30, 2023.

Share Repurchases. During the quarter, the Company repurchased $12.9 million of its outstanding common stock through open market transactions at an average price per share of $28.41.

Liquidity. At the close of the third quarter, the Company had $328.2 million of available liquidity, including $73.2 million of unrestricted cash and $255.0 million of remaining capacity under the unsecured revolving credit facility, compared to total available liquidity of $541.1 million a year ago.

Michael Dunn Appointed as Senior Vice President, General Counsel and Corporate Secretary

The Company also today announced that Michael Dunn has been appointed to serve as the Company’s Senior Vice President, General Counsel and Corporate Secretary, in addition to his role as the Company’s Compliance Officer. Mr. Dunn is replacing Keith L. Belknap, who will be retiring from the Company on September 30, 2024. In connection with his retirement, Mr. Belknap stepped down from his role as the Company’s Executive Vice President, General Counsel and Corporate Secretary, effective as of July 31, 2024.

“Mike’s deep expertise across all legal matters at Beazer has been invaluable, and I am pleased to formally welcome him to the senior leadership team,” said Allan P. Merrill, Beazer’s Chairman and Chief Executive Officer. “He is well-qualified for his new responsibilities, and we look forward to his future contributions to the Company.”

Mr. Dunn has served as the Company’s Deputy General Counsel since January 2023. Mr. Dunn previously served as the Company’s Assistant General Counsel from March 2015 to January 2023 and has served as its Compliance Officer since January 2020.

Following his retirement, Mr. Belknap will continue to work with the Company in a consulting capacity to assist in an orderly transition. “We thank Keith for his dedicated service. We have relied on his advice and judgment for the last six years and wish him all the best in his retirement,” said Mr. Merrill.

John J. Kelley III Appointed to Board of Directors

The Company also today announced the appointment of John J. Kelley to the Board of Directors.

“We are pleased to welcome J. as our newest director,” said Norma A. Provencio, Beazer’s Lead Director. “J. has established himself as a seasoned business leader and senior executive with a wealth of expertise in matters of corporate governance, regulatory compliance and strategic execution. In addition, we look to draw on his considerable experience with respect to information technology and security, which makes him an especially valuable addition to our Board.”

Mr. Kelley has served as the Chief Legal Officer of Equifax Inc. (NYSE: EFX) since 2013, where he is responsible for legal services, compliance, government and legislative relations and corporate governance. Before joining Equifax, Mr. Kelley was a senior partner at King & Spalding LLP in its corporate practice group, where he led a broad range of corporate finance transactions, managed securities matters, and advised corporate clients regarding SEC reporting, disclosure and compliance matters.

Commitment to ESG Initiatives

During the quarter, the Company continued to exhibit leadership and commitment in advancing environmental, social and governance initiatives.

The Company remains dedicated 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 the Company starts will be Zero Energy Ready, which means it will meet the requirements of the U.S. Department of Energy's (DOE) Zero Energy Ready Home program. By the end of the third quarter, the Company had Zero Energy Ready homes under construction in every division, consisting of 93% of new home starts. Notably, Beazer Homes has now certified more homes to the DOE's Single Family National Program requirements than any other home builder.

Exhibiting recognition for the Company's commitment to fostering a supportive, inclusive and fulfilling workplace culture, Beazer Homes was named to the 2024-2025 U.S. News Best Companies to Work For by U.S. News and World Report. The publication evaluated publicly-traded companies on many aspects of career satisfaction, including work-life balance, opportunities for professional development and advancement, company stability, belonging, and more.

In June, the Company published its 2023 Sustainability Report, which highlights its leadership in building energy-efficient homes and significant progress in advancing ESG. Key achievements include:

• Recognized as EPA ENERGY STAR Partner of the Year Award with Sustained Excellence for the eighth consecutive year and EPA 2023 Indoor airPLUS Leader of the Year
• Achieved 100% Indoor airPLUS qualification for all homes
• Completed the Company’s first greenhouse gas (GHG) inventory, which showed significant reductions over the most recent three years
• Received a 95% customer recommendation rating
• Earned the 2023 Top Workplaces USA award and named to Newsweek’s list of America’s Most Trustworthy Companies
• Expanded annual charitable giving to $2.5 million
• Continued to improve diversity among employees and Board of Directors

Summary results for the three and nine months ended June 30, 2024 are as follows:

 

Three Months Ended June 30,

 

 

2024

 

 

 

2023

 

 

Change*

New home orders, net of cancellations

 

1,070

 

 

 

1,200

 

 

(10.8

)%

Cancellation rates

 

18.6

%

 

 

16.1

%

 

250 bps

Orders per community per month

 

2.4

 

 

 

3.2

 

 

(23.9

)%

Average active community count

 

146

 

 

 

124

 

 

17.2

%

Active community count at quarter-end

 

146

 

 

 

125

 

 

16.8

%

Land acquisition and land development spending (in millions)

$

201.1

 

 

$

131.6

 

 

52.7

%

 

 

 

 

 

 

Total home closings

 

1,167

 

 

 

1,117

 

 

4.5

%

ASP from closings (in thousands)

$

505.3

 

 

$

510.8

 

 

(1.1

)%

Homebuilding revenue (in millions)

$

589.6

 

 

$

570.5

 

 

3.3

%

Homebuilding gross margin

 

17.3

%

 

 

20.2

%

 

(290) bps

Homebuilding gross margin, excluding impairments and abandonments (I&A)

 

17.3

%

 

 

20.3

%

 

(300) bps

Homebuilding gross margin, excluding I&A and interest amortized to cost of sales

 

20.3

%

 

 

23.4

%

 

(310) bps

SG&A expenses as a percent of total revenue

 

11.9

%

 

 

11.5

%

 

40 bps

Income from continuing operations before income taxes (in millions)

$

29.7

 

 

$

50.1

 

 

(40.7

)%

Expense from income taxes (in millions)

$

2.5

 

 

$

6.2

 

 

(60.7

)%

Income from continuing operations, net of tax (in millions)

$

27.2

 

 

$

43.8

 

 

(37.9

)%

Basic income per share from continuing operations

$

0.89

 

 

$

1.44

 

 

(38.2

)%

Diluted income per share from continuing operations

$

0.88

 

 

$

1.42

 

 

(38.0

)%

 

 

 

 

 

 

Net income (in millions)

$

27.2

 

 

$

43.8

 

 

(37.9

)%

Adjusted EBITDA (in millions)

$

53.5

 

 

$

72.8

 

 

(26.5

)%

LTM Adjusted EBITDA (in millions)

$

240.3

 

 

$

325.4

 

 

(26.2

)%

Total debt to total capitalization ratio

 

47.6

%

 

 

48.4

%

 

(80) bps

Net debt to net capitalization ratio

 

45.8

%

 

 

40.3

%

 

550 bps

 

* Change and totals are calculated using unrounded numbers. 

 

"LTM" indicates amounts for the trailing 12 months. 

   

 

Nine Months Ended June 30,

 

 

2024

 

 

 

2023

 

 

Change*

New home orders, net of cancellations

 

3,192

 

 

 

2,863

 

 

11.5

%

Cancellation rates

 

16.2

%

 

 

21.5

%

 

(530) bps

LTM orders per community per month

 

2.5

 

 

 

2.4

 

 

4.2

%

Land acquisition and land development spending (in millions)

$

597.5

 

 

$

359.3

 

 

66.3

%

 

 

 

 

 

 

Total home closings

 

2,954

 

 

 

3,013

 

 

(2.0

)%

ASP from closings (in thousands)

$

510.9

 

 

$

516.6

 

 

(1.1

)%

Homebuilding revenue (in millions)

$

1,509.2

 

 

$

1,556.6

 

 

(3.0

)%

Homebuilding gross margin

 

18.5

%

 

 

19.4

%

 

(90) bps

Homebuilding gross margin, excluding I&A

 

18.5

%

 

 

19.5

%

 

(100) bps

Homebuilding gross margin, excluding I&A and interest amortized to cost of sales

 

21.4

%

 

 

22.6

%

 

(120) bps

SG&A expenses as a percent of total revenue

 

12.4

%

 

 

11.6

%

 

80 bps

Income from continuing operations before income taxes (in millions)

$

98.5

 

 

$

118.4

 

 

(16.8

)%

Expense from income taxes (in millions)

$

10.4

 

 

$

15.5

 

 

(33.0

)%

Income from continuing operations, net of tax (in millions)

$

88.1

 

 

$

102.9

 

 

(14.4

)%

Basic income per share from continuing operations

$

2.88

 

 

$

3.39

 

 

(15.0

)%

Diluted income per share from continuing operations

$

2.84

 

 

$

3.36

 

 

(15.5

)%

 

 

 

 

 

 

Net income (in millions)

$

88.1

 

 

$

102.9

 

 

(14.3

)%

Adjusted EBITDA (in millions)

$

150.3

 

 

$

182.1

 

 

(17.5

)%

 

* Change and totals are calculated using unrounded numbers. 

 

"LTM" indicates amounts for the trailing 12 months. 

   

 

As of June 30,

 

2024

 

2023

 

Change

Backlog units

 

1,949

 

 

1,941

 

0.4

%

Dollar value of backlog (in millions)

$

1,046.5

 

$

1,009.8

 

3.6

%

ASP in backlog (in thousands)

$

536.9

 

$

520.3

 

3.2

%

Land and lots controlled

 

28,365

 

 

22,719

 

24.9

%

 

Conference Call

The Company will hold a conference call on August 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 August 15, 2024 at 888-296-6948 (for international callers, dial 203-369-3028) 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;
• 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.

-Tables Follow-

     

BEAZER HOMES USA, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) 

 

 

Three Months Ended

 

Nine Months Ended

 

June 30,

 

June 30,

in thousands (except per share data)

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Total revenue

$

595,682

 

 

$

572,544

 

 

$

1,524,040

 

 

$

1,561,380

 

Home construction and land sales expenses

 

492,178

 

 

 

455,485

 

 

 

1,240,953

 

 

 

1,255,356

 

Inventory impairments and abandonments

 

200

 

 

 

315

 

 

 

200

 

 

 

616

 

Gross profit

 

103,304

 

 

 

116,744

 

 

 

282,887

 

 

 

305,408

 

Commissions

 

21,233

 

 

 

19,473

 

 

 

52,764

 

 

 

51,883

 

General and administrative expenses

 

49,655

 

 

 

46,464

 

 

 

135,645

 

 

 

129,891

 

Depreciation and amortization

 

3,892

 

 

 

2,907

 

 

 

9,698

 

 

 

8,440

 

Operating income

 

28,524

 

 

 

47,900

 

 

 

84,780

 

 

 

115,194

 

Loss on extinguishment of debt, net

 

—

 

 

 

(18

)

 

 

(437

)

 

 

(533

)

Other income, net

 

1,136

 

 

 

2,176

 

 

 

14,136

 

 

 

3,759

 

Income from continuing operations before income taxes

 

29,660

 

 

 

50,058

 

 

 

98,479

 

 

 

118,420

 

Expense from income taxes

 

2,452

 

 

 

6,241

 

 

 

10,372

 

 

 

15,488

 

Income from continuing operations

 

27,208

 

 

 

43,817

 

 

 

88,107

 

 

 

102,932

 

Income (loss) from discontinued operations, net of tax

 

2

 

 

 

—

 

 

 

2

 

 

 

(77

)

Net income

$

27,210

 

 

$

43,817

 

 

$

88,109

 

 

$

102,855

 

Weighted-average number of shares:

 

 

 

 

 

 

 

 

Basic

 

30,513

 

 

 

30,395

 

 

 

30,625

 

 

 

30,335

 

Diluted

 

30,935

 

 

 

30,860

 

 

 

31,017

 

 

 

30,649

 

Basic income per share:

 

 

 

 

 

 

 

 

Continuing operations

$

0.89

 

 

$

1.44

 

 

$

2.88

 

 

$

3.39

 

Discontinued operations

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total

$

0.89

 

 

$

1.44

 

 

$

2.88

 

 

$

3.39

 

Diluted income per share:

 

 

 

 

 

 

 

 

Continuing operations

$

0.88

 

 

$

1.42

 

 

$

2.84

 

 

$

3.36

 

Discontinued operations

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Total

$

0.88

 

 

$

1.42

 

 

$

2.84

 

 

$

3.36

 

 

 

Three Months Ended

 

Nine Months Ended

 

June 30,

 

June 30,

Capitalized Interest in Inventory

 

2024

 

 

 

2023

 

 

 

2024

 

 

 

2023

 

Capitalized interest in inventory, beginning of period

$

123,214

 

 

$

113,886

 

 

$

112,580

 

 

$

109,088

 

Interest incurred

 

20,615

 

 

 

18,027

 

 

 

58,510

 

 

 

53,891

 

Capitalized interest amortized to home construction and land sales expenses

 

(17,267

)

 

 

(17,504

)

 

 

(44,528

)

 

 

(48,570

)

Capitalized interest in inventory, end of period

$

126,562

 

 

$

114,409

 

 

$

126,562

 

 

$

114,409

 

       

BEAZER HOMES USA, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) 

 

in thousands (except share and per share data)

June 30, 2024

 

September 30, 2023

ASSETS

 

 

 

Cash and cash equivalents

$

73,212

 

$

345,590

Restricted cash

 

35,224

 

 

40,699

Accounts receivable (net of allowance of $284 and $284, respectively)

 

64,566

 

 

45,598

Income tax receivable

 

1,675

 

 

—

Owned inventory

 

2,171,924

 

 

1,756,203

Deferred tax assets, net

 

131,951

 

 

133,949

Property and equipment, net

 

38,135

 

 

31,144

Operating lease right-of-use assets

 

19,175

 

 

17,398

Goodwill

 

11,376

 

 

11,376

Other assets

 

47,308

 

 

29,076

Total assets

$

2,594,546

 

$

2,411,033

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

Trade accounts payable

$

188,872

 

$

154,256

Operating lease liabilities

 

20,560

 

 

18,969

Other liabilities

 

137,391

 

 

156,961

Total debt (net of debt issuance costs of $8,734 and $5,759, respectively)

 

1,069,408

 

 

978,028

Total liabilities

 

1,416,231

 

 

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, 31,082,264 issued and outstanding and 31,351,434 issued and outstanding, respectively)

 

31

 

 

31

Paid-in capital

 

852,165

 

 

864,778

Retained earnings

 

326,119

 

 

238,010

Total stockholders’ equity

 

1,178,315

 

 

1,102,819

Total liabilities and stockholders’ equity

$

2,594,546

 

$

2,411,033

 

 

 

 

Inventory Breakdown

 

 

 

Homes under construction

$

914,549

 

$

644,363

Land under development

 

1,002,720

 

 

870,740

Land held for future development

 

19,879

 

 

19,879

Land held for sale

 

14,724

 

 

18,579

Capitalized interest

 

126,562

 

 

112,580

Model homes

 

93,490

 

 

90,062

Total owned inventory

$

2,171,924

 

$

1,756,203

       

BEAZER HOMES USA, INC. SUPPLEMENTAL OPERATING AND FINANCIAL DATA – CONTINUING OPERATIONS 

 

 

Three Months Ended

June 30,

 

Nine Months Ended

June 30,

SELECTED OPERATING DATA

2024

 

2023

 

2024

 

2023

Closings:

 

 

 

 

 

 

 

West region

728

 

634

 

1,849

 

1,775

East region

240

 

253

 

591

 

644

Southeast region

199

 

230

 

514

 

594

Total closings

1,167

 

1,117

 

2,954

 

3,013

 

 

 

 

 

 

 

 

New orders, net of cancellations:

 

 

 

 

 

 

 

West region

715

 

705

 

2,108

 

1,584

East region

250

 

251

 

685

 

667

Southeast region

105

 

244

 

399

 

612

Total new orders, net

1,070

 

1,200

 

3,192

 

2,863

 

 

As of June 30,

Backlog units:

2024

 

2023

West region

 

1,292

 

 

1,066

East region

 

417

 

 

433

Southeast region

 

240

 

 

442

Total backlog units

 

1,949

 

 

1,941

Aggregate dollar value of homes in backlog (in millions)

$

1,046.5

 

$

1,009.8

ASP in backlog (in thousands)

$

536.9

 

$

520.3

 

in thousands

Three Months Ended

June 30,

 

Nine Months Ended

June 30,

SUPPLEMENTAL FINANCIAL DATA

2024

 

2023

 

2024

 

2023

Homebuilding revenue:

 

 

 

 

 

 

 

West region

$

365,906

 

$

326,883

 

$

945,179

 

$

930,166

East region

 

121,239

 

 

132,863

 

 

304,623

 

 

338,763

Southeast region

 

102,498

 

 

110,789

 

 

259,396

 

 

287,697

Total homebuilding revenue

$

589,643

 

$

570,535

 

$

1,509,198

 

$

1,556,626

 

 

 

 

 

 

 

 

Revenue:

 

 

 

 

 

 

 

Homebuilding

$

589,643

 

$

570,535

 

$

1,509,198

 

$

1,556,626

Land sales and other

 

6,039

 

 

2,009

 

 

14,842

 

 

4,754

Total revenue

$

595,682

 

$

572,544

 

$

1,524,040

 

$

1,561,380

 

 

 

 

 

 

 

 

Gross profit:

 

 

 

 

 

 

 

Homebuilding

$

101,983

 

$

115,493

 

$

278,700

 

$

302,195

Land sales and other

 

1,321

 

 

1,251

 

 

4,187

 

 

3,213

Total gross profit

$

103,304

 

$

116,744

 

$

282,887

 

$

305,408

     

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 June 30,

 

Nine Months Ended June 30,

in thousands

2024

 

2023

 

2024

 

2023

Homebuilding gross profit/margin (GAAP)

$

101,983

17.3

%

 

$

115,493

20.2

%

 

$

278,700

18.5

%

 

$

302,195

19.4

%

Inventory impairments and abandonments (I&A)

 

200

 

 

 

315

 

 

 

200

 

 

 

616

 

Homebuilding gross profit/margin excluding I&A (Non-GAAP)

 

102,183

17.3

%

 

 

115,808

20.3

%

 

 

278,900

18.5

%

 

 

302,811

19.5

%

Interest amortized to cost of sales

 

17,267

 

 

 

17,504

 

 

 

44,528

 

 

 

48,570

 

Homebuilding gross profit/margin excluding I&A and interest amortized to cost of sales (Non-GAAP)

$

119,450

20.3

%

 

$

133,312

23.4

%

 

$

323,428

21.4

%

 

$

351,381

22.6

%

     

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 Ended June 30,

 

Nine Months Ended June 30,

 

LTM Ended June 30,(a)

in thousands

2024

 

2023

 

2024

 

2023

 

2024

 

2023

Net income (GAAP)

$

27,210

 

$

43,817

 

$

88,109

 

 

$

102,855

 

$

143,865

 

 

$

189,678

Expense from income taxes

 

2,453

 

 

6,241

 

 

10,373

 

 

 

15,466

 

 

18,843

 

 

 

39,050

Interest amortized to home construction and land sales expenses and capitalized interest impaired

 

17,267

 

 

17,504

 

 

44,528

 

 

 

48,570

 

 

64,447

 

 

 

74,086

EBIT (Non-GAAP)

 

46,930

 

 

67,562

 

 

143,010

 

 

 

166,891

 

 

227,155

 

 

 

302,814

Depreciation and amortization

 

3,892

 

 

2,907

 

 

9,698

 

 

 

8,440

 

 

13,456

 

 

 

12,699

EBITDA (Non-GAAP)

 

50,822

 

 

70,469

 

 

152,708

 

 

 

175,331

 

 

240,611

 

 

 

315,513

Stock-based compensation expense

 

2,474

 

 

1,989

 

 

5,536

 

 

 

5,247

 

 

7,564

 

 

 

7,210

Loss on extinguishment of debt

 

—

 

 

18

 

 

437

 

 

 

533

 

 

450

 

 

 

146

Inventory impairments and abandonments(b)

 

200

 

 

315

 

 

200

 

 

 

616

 

 

225

 

 

 

2,205

Gain on sale of investment(c)

 

—

 

 

—

 

 

(8,591

)

 

 

—

 

 

(8,591

)

 

 

—

Severance expenses

 

—

 

 

—

 

 

—

 

 

 

335

 

 

—

 

 

 

335

Adjusted EBITDA (Non-GAAP)

$

53,496

 

$

72,791

 

$

150,290

 

 

$

182,062

 

$

240,259

 

 

$

325,409

(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 during 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.

     

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 June 30, 2024

 

As of June 30, 2023

Total debt (GAAP)

$

1,069,408

 

 

$

981,128

 

Stockholders' equity (GAAP)

 

1,178,315

 

 

 

1,044,785

 

Total capitalization (GAAP)

$

2,247,723

 

 

$

2,025,913

 

Total debt to total capitalization ratio (GAAP)

 

47.6

%

 

 

48.4

%

 

 

 

 

Total debt (GAAP)

$

1,069,408

 

 

$

981,128

 

Less: cash and cash equivalents (GAAP)

 

73,212

 

 

 

276,125

 

Net debt (Non-GAAP)

 

996,196

 

 

 

705,003

 

Stockholders' equity (GAAP)

 

1,178,315

 

 

 

1,044,785

 

Net capitalization (Non-GAAP)

$

2,174,511

 

 

$

1,749,788

 

Net debt to net capitalization ratio (Non-GAAP)

 

45.8

%

 

 

40.3

%

   

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240801243559/en/

Beazer Homes USA, Inc.

David I. Goldberg Sr. Vice President & Chief Financial Officer 770-829-3700 investor.relations@beazer.com