- Q2 Earnings of
$0.11 Per Share, After Charges of$0.14 Per Share for Insurance Reserves and Office Relocation Costs - Q2 Pretax Income of
$68 Million After Charges of$88 Million ; Q2 2013 Pretax Income of$38 Million After Charges of$67 Million - Home Sale Revenues Increased 2% to
$1.2 Billion - Average Selling Price for Homes Delivered in the Quarter Increased 12% to
$328,000 - Gross Margin of 23.6% Expanded by 480 Basis Points Over Prior Year
- Value of Net New Orders Increased 5% to
$1.6 Billion - Higher Absorptions Per Community Drove Signups of 4,778 Homes
- Backlog Value at Quarter End of
$2.8 Billion , Up from$2.7 Billion in 2013 - 7% Increase in Average Sales Price of Homes in Backlog to
$339,000 - Company Announces New
$500 Million Senior Unsecured Revolving Credit Facility
"The ongoing gains demonstrated in
"Our view of the U.S. housing market remains positive, as improvements in both the economy and employment provide ongoing support to an industry already benefiting from low inventory, low mortgage rates, better pricing and favorable demographic trends. Within this environment, our strong operating gains enable us to continue increasing investment into the business, while continuing to drive excellent returns on invested capital."
Second Quarter Results
Home sale revenues for the second quarter increased 2% to
The Company's home sale gross margin for the period was 23.6%, which is an increase of 480 basis points over the prior year. Homebuilding SG&A expense for the quarter was
"The adjustment to insurance reserves was primarily driven by estimated costs associated with siding repairs in certain previously completed communities in the west that, in turn, impacted actuarial estimates for potential future claims," said
The value of net new orders for the second quarter increased 5% to
The Company's financial services operations reported second quarter pretax income of
During the quarter,
Effective
A conference call discussing
Forward-Looking Statements
This press release includes "forward-looking statements." These statements are subject to a number of risks, uncertainties and other factors that could cause our actual results, performance, prospects or opportunities, as well as those of the markets we serve or intend to serve, to differ materially from those expressed in, or implied by, these statements. You can identify these statements by the fact that they do not relate to matters of a strictly factual or historical nature and generally discuss or relate to forecasts, estimates or other expectations regarding future events. Generally, the words "believe," "expect," "intend," "estimate," "anticipate," "project," "may," "can," "could," "might," "will" and similar expressions identify forward-looking statements, including statements related to expected operating and performing results, planned transactions, planned objectives of management, future developments or conditions in the industries in which we participate and other trends, developments and uncertainties that may affect our business in the future.
Such risks, uncertainties and other factors include, among other things: interest rate changes and the availability of mortgage financing; continued volatility in the debt and equity markets; competition within the industries in which
About
For more information about
PulteGroup, Inc. |
|||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||
June 30, |
June 30, |
||||||||||||||
2014 |
2013 |
2014 |
2013 |
||||||||||||
Revenues: |
|||||||||||||||
Homebuilding |
|||||||||||||||
Home sale revenues |
$ |
1,246,462 |
$ |
1,219,675 |
$ |
2,334,477 |
$ |
2,319,427 |
|||||||
Land sale revenues |
8,527 |
20,385 |
14,511 |
46,516 |
|||||||||||
1,254,989 |
1,240,060 |
2,348,988 |
2,365,943 |
||||||||||||
Financial Services |
31,198 |
39,362 |
56,093 |
76,235 |
|||||||||||
Total revenues |
1,286,187 |
1,279,422 |
2,405,081 |
2,442,178 |
|||||||||||
Homebuilding Cost of Revenues: |
|||||||||||||||
Home sale cost of revenues |
952,692 |
990,818 |
1,781,295 |
1,892,288 |
|||||||||||
Land sale cost of revenues |
6,832 |
20,710 |
11,843 |
42,728 |
|||||||||||
959,524 |
1,011,528 |
1,793,138 |
1,935,016 |
||||||||||||
Financial Services expenses |
22,114 |
23,035 |
25,436 |
45,623 |
|||||||||||
Selling, general and administrative expenses |
229,767 |
150,531 |
374,655 |
280,157 |
|||||||||||
Other expense, net |
9,324 |
57,339 |
23,155 |
62,111 |
|||||||||||
Interest income |
(1,115) |
(1,112) |
(2,226) |
(2,285) |
|||||||||||
Interest expense |
203 |
166 |
416 |
373 |
|||||||||||
Equity in (earnings) loss of unconsolidated entities |
(1,311) |
(395) |
(7,202) |
503 |
|||||||||||
Income before income taxes |
67,681 |
38,330 |
197,709 |
120,680 |
|||||||||||
Income tax expense |
25,801 |
1,913 |
81,010 |
2,501 |
|||||||||||
Net income |
$ |
41,880 |
$ |
36,417 |
$ |
116,699 |
$ |
118,179 |
|||||||
Per share: |
|||||||||||||||
Basic earnings |
$ |
0.11 |
$ |
0.09 |
$ |
0.31 |
$ |
0.31 |
|||||||
Diluted earnings |
$ |
0.11 |
$ |
0.09 |
$ |
0.30 |
$ |
0.30 |
|||||||
Cash dividends declared |
$ |
0.05 |
$ |
— |
$ |
0.10 |
$ |
— |
|||||||
Number of shares used in calculation: |
|||||||||||||||
Basic |
376,072 |
385,389 |
377,410 |
384,813 |
|||||||||||
Effect of dilutive securities |
3,592 |
5,791 |
3,703 |
5,943 |
|||||||||||
Diluted |
379,664 |
391,180 |
381,113 |
390,756 |
PulteGroup, Inc. |
|||||||
June 30, |
December 31, |
||||||
ASSETS |
|||||||
Cash and equivalents |
$ |
1,170,934 |
$ |
1,580,329 |
|||
Restricted cash |
101,607 |
72,715 |
|||||
House and land inventory |
4,197,121 |
3,978,561 |
|||||
Land held for sale |
80,328 |
61,735 |
|||||
Land, not owned, under option agreements |
27,294 |
24,024 |
|||||
Residential mortgage loans available-for-sale |
221,607 |
287,933 |
|||||
Investments in unconsolidated entities |
40,131 |
45,323 |
|||||
Other assets |
496,990 |
460,621 |
|||||
Intangible assets |
129,598 |
136,148 |
|||||
Deferred tax assets, net |
2,001,726 |
2,086,754 |
|||||
$ |
8,467,336 |
$ |
8,734,143 |
||||
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||||
Liabilities: |
|||||||
Accounts payable |
$ |
253,915 |
$ |
202,736 |
|||
Customer deposits |
206,991 |
134,858 |
|||||
Accrued and other liabilities |
1,301,186 |
1,377,750 |
|||||
Income tax liabilities |
193,146 |
206,015 |
|||||
Financial Services debt |
58,506 |
105,664 |
|||||
Senior notes |
1,815,548 |
2,058,168 |
|||||
3,829,292 |
4,085,191 |
||||||
Shareholders' equity |
4,638,044 |
4,648,952 |
|||||
$ |
8,467,336 |
$ |
8,734,143 |
PulteGroup, Inc. |
|||||||
Six Months Ended |
|||||||
June 30, |
|||||||
2014 |
2013 |
||||||
Cash flows from operating activities: |
|||||||
Net income |
$ |
116,699 |
$ |
118,179 |
|||
Adjustments to reconcile net income to net cash flows provided by (used in) operating activities: |
|||||||
Deferred income tax expense |
85,028 |
— |
|||||
Depreciation and amortization |
18,904 |
15,084 |
|||||
Stock-based compensation expense |
16,797 |
15,765 |
|||||
Equity in (earnings) loss of unconsolidated entities |
(7,202) |
503 |
|||||
Distributions of earnings from unconsolidated entities |
4,777 |
1,298 |
|||||
Loss on debt retirements |
8,584 |
23,072 |
|||||
Other non-cash, net |
6,649 |
8,986 |
|||||
Increase (decrease) in cash due to: |
|||||||
Restricted cash |
(726) |
1,285 |
|||||
Inventories |
(249,861) |
32,920 |
|||||
Residential mortgage loans available-for-sale |
64,672 |
81,336 |
|||||
Other assets |
(15,709) |
(32,607) |
|||||
Accounts payable, accrued and other liabilities |
38,539 |
67,463 |
|||||
Income tax liabilities |
(12,869) |
1,781 |
|||||
Net cash provided by (used in) operating activities |
74,282 |
335,065 |
|||||
Cash flows from investing activities: |
|||||||
Distributions from unconsolidated entities |
7,577 |
200 |
|||||
Investments in unconsolidated entities |
(9) |
(807) |
|||||
Net change in loans held for investment |
(6,791) |
18 |
|||||
Change in restricted cash related to letters of credit |
(28,166) |
4,222 |
|||||
Proceeds from the sale of property and equipment |
98 |
9 |
|||||
Capital expenditures |
(33,021) |
(11,017) |
|||||
Net cash provided by (used in) investing activities |
(60,312) |
(7,375) |
|||||
Cash flows from financing activities: |
|||||||
Financial Services borrowings (repayments) |
(47,158) |
(78,929) |
|||||
Other borrowings (repayments) |
(240,133) |
(452,950) |
|||||
Stock option exercises |
5,789 |
18,544 |
|||||
Stock repurchases |
(103,711) |
(6,447) |
|||||
Dividends paid |
(38,152) |
— |
|||||
Net cash provided by (used in) financing activities |
(423,365) |
(519,782) |
|||||
Net increase (decrease) in cash and equivalents |
(409,395) |
(192,092) |
|||||
Cash and equivalents at beginning of period |
1,580,329 |
1,404,760 |
|||||
Cash and equivalents at end of period |
$ |
1,170,934 |
$ |
1,212,668 |
|||
Supplemental Cash Flow Information: |
|||||||
Interest paid (capitalized), net |
$ |
(328) |
$ |
2,309 |
|||
Income taxes paid (refunded), net |
$ |
(2,487) |
$ |
(2,471) |
PulteGroup, Inc. |
|||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||
June 30, |
June 30, |
||||||||||||||
2014 |
2013 |
2014 |
2013 |
||||||||||||
HOMEBUILDING: |
|||||||||||||||
Home sale revenues |
$ |
1,246,462 |
$ |
1,219,675 |
$ |
2,334,477 |
$ |
2,319,427 |
|||||||
Land sale revenues |
8,527 |
20,385 |
14,511 |
46,516 |
|||||||||||
Total Homebuilding revenues |
1,254,989 |
1,240,060 |
2,348,988 |
2,365,943 |
|||||||||||
Home sale cost of revenues |
952,692 |
990,818 |
1,781,295 |
1,892,288 |
|||||||||||
Land sale cost of revenues |
6,832 |
20,710 |
11,843 |
42,728 |
|||||||||||
Selling, general and administrative expenses |
229,767 |
150,531 |
374,655 |
280,157 |
|||||||||||
Equity in (earnings) loss of unconsolidated entities |
(1,287) |
(363) |
(7,157) |
563 |
|||||||||||
Other expense, net |
9,324 |
57,339 |
23,155 |
62,111 |
|||||||||||
Interest income, net |
(912) |
(946) |
(1,810) |
(1,912) |
|||||||||||
Income before income taxes |
$ |
58,573 |
$ |
21,971 |
$ |
167,007 |
$ |
90,008 |
|||||||
FINANCIAL SERVICES: |
|||||||||||||||
Income before income taxes |
$ |
9,108 |
$ |
16,359 |
$ |
30,702 |
$ |
30,672 |
|||||||
CONSOLIDATED: |
|||||||||||||||
Income before income taxes |
$ |
67,681 |
$ |
38,330 |
$ |
197,709 |
$ |
120,680 |
PulteGroup, Inc. |
||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||
June 30, |
June 30, |
|||||||||||||||
2014 |
2013 |
2014 |
2013 |
|||||||||||||
Home sale revenues |
$ |
1,246,462 |
$ |
1,219,675 |
$ |
2,334,477 |
$ |
2,319,427 |
||||||||
Closings - units |
||||||||||||||||
Northeast |
346 |
378 |
689 |
680 |
||||||||||||
Southeast |
785 |
735 |
1,432 |
1,386 |
||||||||||||
Florida |
623 |
649 |
1,190 |
1,232 |
||||||||||||
Texas |
885 |
960 |
1,666 |
1,857 |
||||||||||||
North |
678 |
741 |
1,308 |
1,407 |
||||||||||||
Southwest |
481 |
689 |
949 |
1,423 |
||||||||||||
3,798 |
4,152 |
7,234 |
7,985 |
|||||||||||||
Average selling price |
$ |
328 |
$ |
294 |
$ |
323 |
$ |
290 |
||||||||
Net new orders - units |
||||||||||||||||
Northeast |
380 |
543 |
824 |
1,114 |
||||||||||||
Southeast |
880 |
887 |
1,704 |
1,846 |
||||||||||||
Florida |
774 |
701 |
1,624 |
1,505 |
||||||||||||
Texas |
1,139 |
988 |
2,311 |
2,068 |
||||||||||||
North |
988 |
976 |
1,880 |
1,945 |
||||||||||||
Southwest |
617 |
790 |
1,298 |
1,607 |
||||||||||||
4,778 |
4,885 |
9,641 |
10,085 |
|||||||||||||
Net new orders - dollars (a) |
$ |
1,594,408 |
$ |
1,519,656 |
$ |
3,202,814 |
$ |
3,101,621 |
||||||||
Unit backlog |
||||||||||||||||
Northeast |
756 |
1,056 |
||||||||||||||
Southeast |
1,325 |
1,371 |
||||||||||||||
Florida |
1,347 |
1,338 |
||||||||||||||
Texas |
1,895 |
1,666 |
||||||||||||||
North |
1,785 |
1,805 |
||||||||||||||
Southwest |
1,071 |
1,322 |
||||||||||||||
8,179 |
8,558 |
|||||||||||||||
Dollars in backlog |
$ |
2,770,134 |
$ |
2,713,733 |
||||||||||||
(a) |
Net new order dollars represent a composite of new order dollars combined with other movements of the dollars in backlog related to cancellations and change orders. |
PulteGroup, Inc. |
|||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||
June 30, |
June 30, |
||||||||||||||
2014 |
2013 |
2014 |
2013 |
||||||||||||
MORTGAGE ORIGINATIONS: |
|||||||||||||||
Origination volume |
2,469 |
2,812 |
4,583 |
5,534 |
|||||||||||
Origination principal |
$ |
597,273 |
$ |
643,267 |
$ |
1,092,802 |
$ |
1,265,264 |
|||||||
Capture rate |
80.3 |
% |
79.8 |
% |
79.3 |
% |
81.0 |
% |
|||||||
Supplemental Data ($000's omitted) (Unaudited) |
|||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||
June 30, |
June 30, |
||||||||||||||
2014 |
2013 |
2014 |
2013 |
||||||||||||
Interest in inventory, beginning of period |
$ |
225,619 |
$ |
320,859 |
$ |
230,922 |
$ |
331,880 |
|||||||
Interest capitalized |
31,455 |
39,909 |
66,768 |
82,565 |
|||||||||||
Interest expensed |
(46,471) |
(62,193) |
(87,087) |
(115,870) |
|||||||||||
Interest in inventory, end of period |
$ |
210,603 |
$ |
298,575 |
$ |
210,603 |
$ |
298,575 |
|||||||
Interest incurred |
$ |
31,455 |
$ |
39,909 |
$ |
66,768 |
$ |
82,565 |
SOURCE