- Q4 2013 Earnings of
$220 Million , or$0.57 Per Share, Compared with$59 Million , or$0.15 Per Share, in the Prior Year - Q4 Home Sale Gross Margin of 23.2% Increased 610 Basis Points Over Prior Year and 230 Basis Points Over Prior Quarter; Adjusted Gross Margin of 27.7% is Up 590 Basis Points Over Q4 2012
- SG&A Reduced 30 Basis Points from Prior Year to 9.3% of Home Sale Revenues
- Home Sale Revenues Increased 9% to
$1.6 Billion Driven by a 13% Increase in Average Selling Price - Year-end Backlog of 5,772 Homes With a Value of
$1.9 Billion - Repurchased
$35 Million of Stock in the Quarter - Debt-to-Capitalization of 31%, Down from 53% at Year-end 2012
- Company has Increased Authorized Land Spend in 2014 to
$2.0 Billion , Compared with$1.3 Billion Invested in 2013
"Our fourth quarter results complete an outstanding year during which we realized dramatic operating and financial improvement as we continue to benefit from our Value Creation initiatives and from the ongoing recovery in U.S. housing," said
"The material improvement in our key operating and financial metrics has allowed us to reduce our leverage and build a cash balance of
"We expect the rebound in housing to continue in 2014, supported by many of the factors that first launched the recovery, including: low interest rates; a limited supply of new and existing homes; and an ongoing, albeit modest, recovery in the broader economy. Based on this view, we have authorized an increase in land related spend to
Fourth Quarter Results
Home sale revenues for the quarter ended
Reported home sale gross margin for the period was 23.2%, an increase of 610 basis points over the prior year and 230 basis points over the third quarter of 2013. Homebuilding SG&A expense for the quarter was
For the quarter, the Company reported 3,214 net new orders, a decrease of 18% from prior year orders of 3,926. The dollar value of net new orders was
The Company's financial services operations reported pretax income of
For the quarter, the Company reported
Through open-market transactions,
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. Consolidated Results of Operations ($000's omitted, except per share data) (Unaudited) |
|||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
December 31, |
December 31, |
||||||||||||||
2013 |
2012 |
2013 |
2012 |
||||||||||||
Revenues: |
|||||||||||||||
Homebuilding |
|||||||||||||||
Home sale revenues |
$ |
1,612,923 |
$ |
1,481,517 |
$ |
5,424,309 |
$ |
4,552,412 |
|||||||
Land sale revenues |
12,036 |
36,928 |
114,335 |
106,698 |
|||||||||||
1,624,959 |
1,518,445 |
5,538,644 |
4,659,110 |
||||||||||||
Financial Services |
30,380 |
48,521 |
140,951 |
160,888 |
|||||||||||
Total revenues |
1,655,339 |
1,566,966 |
5,679,595 |
4,819,998 |
|||||||||||
Homebuilding Cost of Revenues: |
|||||||||||||||
Home sale cost of revenues |
1,238,103 |
1,228,201 |
4,310,528 |
3,833,451 |
|||||||||||
Land sale cost of revenues |
11,765 |
32,811 |
104,426 |
94,880 |
|||||||||||
1,249,868 |
1,261,012 |
4,414,954 |
3,928,331 |
||||||||||||
Financial Services expenses |
23,513 |
72,597 |
92,379 |
135,511 |
|||||||||||
Selling, general, and administrative expenses |
149,705 |
141,766 |
568,500 |
514,457 |
|||||||||||
Other expense, net |
1,588 |
41,728 |
80,753 |
66,298 |
|||||||||||
Interest income |
(1,075) |
(1,331) |
(4,395) |
(4,913) |
|||||||||||
Interest expense |
168 |
204 |
712 |
819 |
|||||||||||
Equity in earnings of unconsolidated entities |
(848) |
(223) |
(1,130) |
(4,059) |
|||||||||||
Income before income taxes |
232,420 |
51,213 |
527,822 |
183,554 |
|||||||||||
Income tax expense (benefit) |
12,367 |
(7,529) |
(2,092,294) |
(22,591) |
|||||||||||
Net income |
$ |
220,053 |
$ |
58,742 |
$ |
2,620,116 |
$ |
206,145 |
|||||||
Net income per share: |
|||||||||||||||
Basic |
$ |
0.58 |
$ |
0.15 |
$ |
6.79 |
$ |
0.54 |
|||||||
Diluted |
$ |
0.57 |
$ |
0.15 |
$ |
6.72 |
$ |
0.54 |
|||||||
Cash dividends declared |
$ |
0.05 |
$ |
— |
$ |
0.15 |
$ |
— |
|||||||
Number of shares used in calculation: |
|||||||||||||||
Basic |
379,879 |
383,404 |
383,077 |
381,562 |
|||||||||||
Effect of dilutive securities |
3,845 |
5,900 |
3,789 |
3,002 |
|||||||||||
Diluted |
383,724 |
389,304 |
386,866 |
384,564 |
PulteGroup, Inc. Condensed Consolidated Balance Sheets ($000's omitted) (Unaudited) |
|||||||
December 31, |
December 31, |
||||||
ASSETS |
|||||||
Cash and equivalents |
$ |
1,580,329 |
$ |
1,404,760 |
|||
Restricted cash |
72,715 |
71,950 |
|||||
House and land inventory |
3,978,561 |
4,214,046 |
|||||
Land held for sale |
61,735 |
91,104 |
|||||
Land, not owned, under option agreements |
24,024 |
31,066 |
|||||
Residential mortgage loans available-for-sale |
287,933 |
318,931 |
|||||
Investments in unconsolidated entities |
45,323 |
45,629 |
|||||
Other assets |
460,621 |
407,675 |
|||||
Intangible assets |
136,148 |
149,248 |
|||||
Deferred tax assets, net |
2,086,754 |
— |
|||||
$ |
8,734,143 |
$ |
6,734,409 |
||||
LIABILITIES AND SHAREHOLDERS' EQUITY |
|||||||
Liabilities: |
|||||||
Accounts payable |
$ |
202,736 |
$ |
178,274 |
|||
Customer deposits |
134,858 |
101,183 |
|||||
Accrued and other liabilities |
1,377,750 |
1,418,063 |
|||||
Income tax liabilities |
206,015 |
198,865 |
|||||
Financial Services debt |
105,664 |
138,795 |
|||||
Senior notes |
2,058,168 |
2,509,613 |
|||||
Total liabilities |
4,085,191 |
4,544,793 |
|||||
Shareholders' equity |
4,648,952 |
2,189,616 |
|||||
$ |
8,734,143 |
$ |
6,734,409 |
PulteGroup, Inc. Consolidating Statements of Cash Flows ($000's omitted) (Unaudited) |
|||||||
Year Ended |
|||||||
December 31, |
|||||||
2013 |
2012 |
||||||
Cash flows from operating activities: |
|||||||
Net income |
$ |
2,620,116 |
$ |
206,145 |
|||
Adjustments to reconcile net income to net cash flows provided by (used in) operating activities: |
|||||||
Deferred income taxes |
(2,096,425) |
— |
|||||
Write-down of land and deposits and pre-acquisition costs |
9,672 |
17,195 |
|||||
Amortization and depreciation |
31,587 |
30,027 |
|||||
Stock-based compensation expense |
30,480 |
22,897 |
|||||
Loss on debt repurchases |
26,930 |
32,071 |
|||||
Equity in earnings of unconsolidated entities |
(1,130) |
(4,059) |
|||||
Distributions of earnings from unconsolidated entities |
2,049 |
7,488 |
|||||
Other non-cash, net |
9,375 |
10,356 |
|||||
Increase (decrease) in cash due to: |
|||||||
Restricted cash |
3,387 |
1,257 |
|||||
Inventories |
265,064 |
455,223 |
|||||
Residential mortgage loans available-for-sale |
28,448 |
(60,828) |
|||||
Other assets |
(38,190) |
26,014 |
|||||
Accounts payable, accrued and other liabilities |
(17,377) |
20,802 |
|||||
Income tax liabilities |
7,150 |
(4,448) |
|||||
Net cash provided by (used in) operating activities |
881,136 |
760,140 |
|||||
Cash flows from investing activities: |
|||||||
Distributions from unconsolidated entities |
1,001 |
3,029 |
|||||
Investments in unconsolidated entities |
(1,677) |
(16,456) |
|||||
Net change in loans held for investment |
(12,265) |
836 |
|||||
Change in restricted cash related to letters of credit |
(4,152) |
28,653 |
|||||
Proceeds from the sale of property and equipment |
15 |
7,586 |
|||||
Capital expenditures |
(28,899) |
(13,942) |
|||||
Net cash provided by (used in) investing activities |
(45,977) |
9,706 |
|||||
Cash flows from financing activities: |
|||||||
Financial Services borrowings (repayments) |
(33,131) |
138,795 |
|||||
Other borrowings (repayments) |
(479,827) |
(618,800) |
|||||
Stock option exercises |
19,411 |
32,809 |
|||||
Stock repurchases |
(127,661) |
(961) |
|||||
Dividends paid |
(38,382) |
— |
|||||
Net cash provided by (used in) financing activities |
(659,590) |
(448,157) |
|||||
Net increase (decrease) in cash and equivalents |
175,569 |
321,689 |
|||||
Cash and equivalents at beginning of period |
1,404,760 |
1,083,071 |
|||||
Cash and equivalents at end of period |
$ |
1,580,329 |
$ |
1,404,760 |
|||
Supplemental Cash Flow Information: |
|||||||
Interest paid (capitalized), net |
$ |
(171) |
$ |
(1,470) |
|||
Income taxes paid (refunded), net |
$ |
373 |
$ |
(13,322) |
PulteGroup, Inc. Segment Data ($000's omitted) (Unaudited) |
|||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
December 31, |
December 31, |
||||||||||||||
2013 |
2012 |
2013 |
2012 |
||||||||||||
HOMEBUILDING: |
|||||||||||||||
Home sale revenues |
$ |
1,612,923 |
$ |
1,481,517 |
$ |
5,424,309 |
$ |
4,552,412 |
|||||||
Land sale revenues |
12,036 |
36,928 |
114,335 |
106,698 |
|||||||||||
Total Homebuilding revenues |
1,624,959 |
1,518,445 |
5,538,644 |
4,659,110 |
|||||||||||
Home sale cost of revenues |
1,238,103 |
1,228,201 |
4,310,528 |
3,833,451 |
|||||||||||
Land sale cost of revenues |
11,765 |
32,811 |
104,426 |
94,880 |
|||||||||||
Selling, general, and administrative expenses |
149,705 |
141,766 |
568,500 |
514,457 |
|||||||||||
Equity in earnings of unconsolidated entities |
(806) |
(159) |
(993) |
(3,873) |
|||||||||||
Other expense, net |
1,588 |
41,728 |
80,753 |
66,298 |
|||||||||||
Interest income, net |
(907) |
(1,127) |
(3,683) |
(4,094) |
|||||||||||
Income before income taxes |
$ |
225,511 |
$ |
75,225 |
$ |
479,113 |
$ |
157,991 |
|||||||
FINANCIAL SERVICES: |
|||||||||||||||
Income (loss) before income taxes |
$ |
6,909 |
$ |
(24,012) |
$ |
48,709 |
$ |
25,563 |
|||||||
CONSOLIDATED: |
|||||||||||||||
Income before income taxes |
$ |
232,420 |
$ |
51,213 |
$ |
527,822 |
$ |
183,554 |
PulteGroup, Inc. Segment data, continued ($000's omitted) (Unaudited) |
|||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
December 31, |
December 31, |
||||||||||||||
2013 |
2012 |
2013 |
2012 |
||||||||||||
Home sale revenues |
$ |
1,612,923 |
$ |
1,481,517 |
$ |
5,424,309 |
$ |
4,552,412 |
|||||||
Closings - units |
|||||||||||||||
Northeast |
623 |
576 |
1,835 |
1,800 |
|||||||||||
Southeast |
813 |
773 |
3,022 |
2,757 |
|||||||||||
Florida |
755 |
707 |
2,747 |
2,340 |
|||||||||||
Texas |
935 |
1,003 |
3,768 |
3,487 |
|||||||||||
North |
1,068 |
1,046 |
3,401 |
3,103 |
|||||||||||
Southwest |
770 |
1,049 |
2,993 |
3,018 |
|||||||||||
4,964 |
5,154 |
17,766 |
16,505 |
||||||||||||
Average selling price |
$ |
325 |
$ |
287 |
$ |
305 |
$ |
276 |
|||||||
Net new orders - units |
|||||||||||||||
Northeast |
315 |
398 |
1,834 |
1,997 |
|||||||||||
Southeast |
604 |
682 |
3,164 |
3,066 |
|||||||||||
Florida |
501 |
600 |
2,595 |
2,747 |
|||||||||||
Texas |
682 |
905 |
3,563 |
4,117 |
|||||||||||
North |
682 |
789 |
3,347 |
3,661 |
|||||||||||
Southwest |
430 |
552 |
2,577 |
3,451 |
|||||||||||
3,214 |
3,926 |
17,080 |
19,039 |
||||||||||||
Net new orders - dollars (a) |
$ |
1,081,971 |
$ |
1,166,760 |
$ |
5,394,566 |
$ |
5,424,300 |
|||||||
December 31, |
|||||||||||||||
2013 |
2012 |
||||||||||||||
Unit backlog |
|||||||||||||||
Northeast |
621 |
622 |
|||||||||||||
Southeast |
1,053 |
911 |
|||||||||||||
Florida |
913 |
1,065 |
|||||||||||||
Texas |
1,250 |
1,455 |
|||||||||||||
North |
1,213 |
1,267 |
|||||||||||||
Southwest |
722 |
1,138 |
|||||||||||||
5,772 |
6,458 |
||||||||||||||
Dollars in backlog |
$ |
1,901,796 |
$ |
1,931,538 |
|||||||||||
(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. Segment Data, continued ($000's omitted) (Unaudited) |
|||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
December 31, |
December 31, |
||||||||||||||
2013 |
2012 |
2013 |
2012 |
||||||||||||
MORTGAGE ORIGINATIONS: |
|||||||||||||||
Origination volume |
3,158 |
3,625 |
11,818 |
11,322 |
|||||||||||
Origination principal |
$ |
766,812 |
$ |
828,607 |
$ |
2,765,509 |
$ |
2,509,928 |
|||||||
Capture rate |
79.4 |
% |
83.0 |
% |
80.2 |
% |
81.9 |
% |
|||||||
Supplemental Data ($000's omitted) (Unaudited) |
|||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
December 31, |
December 31, |
||||||||||||||
2013 |
2012 |
2013 |
2012 |
||||||||||||
Interest in inventory, beginning of period |
$ |
266,524 |
$ |
352,026 |
$ |
331,880 |
$ |
355,068 |
|||||||
Interest capitalized |
35,580 |
47,734 |
154,107 |
201,103 |
|||||||||||
Interest expensed |
(71,182) |
(67,880) |
(255,065) |
(224,291) |
|||||||||||
Interest in inventory, end of period |
$ |
230,922 |
$ |
331,880 |
$ |
230,922 |
$ |
331,880 |
|||||||
Interest incurred |
$ |
35,748 |
$ |
47,734 |
$ |
154,819 |
$ |
201,103 |
Reconciliation of Non-GAAP Financial Measures
This report contains information about our home sale gross margins reflecting certain adjustments. This measure is considered a non-GAAP financial measure under the
The following table sets forth a reconciliation of this non-GAAP financial measure to the GAAP financial measure that management believes to be most directly comparable ($000's omitted):
Home Sale Gross Margin |
|||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
December 31, |
December 31, |
||||||||||||||
2013 |
2012 |
2013 |
2012 |
||||||||||||
Home sale revenues |
$ |
1,612,923 |
$ |
1,481,517 |
$ |
5,424,309 |
$ |
4,552,412 |
|||||||
Home sale cost of revenues |
1,238,103 |
1,228,201 |
4,310,528 |
3,833,451 |
|||||||||||
Home sale gross margin |
374,820 |
253,316 |
1,113,781 |
718,961 |
|||||||||||
Add: |
|||||||||||||||
Impairments (a) |
— |
2,250 |
— |
6,969 |
|||||||||||
Capitalized interest amortization (a) |
71,182 |
67,880 |
255,065 |
224,291 |
|||||||||||
Adjusted home sale gross margin |
$ |
446,002 |
$ |
323,446 |
$ |
1,368,846 |
$ |
950,221 |
|||||||
Home sale gross margin as a percentage of home sale revenues |
23.2 |
% |
17.1 |
% |
20.5 |
% |
15.8 |
% |
|||||||
Adjusted home sale gross margin as a percentage of home sale revenues |
27.7 |
% |
21.8 |
% |
25.2 |
% |
20.9 |
% |
|||||||
(a) Write-offs of capitalized interest related to impairments are reflected in capitalized interest amortization. |
SOURCE