Tri Pointe Homes, Inc. Reports 2024 Fourth Quarter And Full Year Results

Fourth Quarter Highlights

-New Home Deliveries of 1,748 for Home Sales Revenue of $1.2 Billion-
-Homebuilding Gross Margin Percentage of 23.3%-
-Selling, General and Administrative Expense as a Percentage of Home Sales Revenue of 10.3%-
-Diluted Earnings Per Share of $1.37-

INCLINE VILLAGE, Nev., Feb. 18, 2025 (GLOBE NEWSWIRE) -- Tri Pointe Homes, Inc. (the “Company”) (NYSE: TPH) today announced results for the fourth quarter ended December 31, 2024 and full year 2024.

“Tri Pointe Homes delivered strong fourth quarter results, capping off another exceptional year for our company,” said Tri Pointe Homes Chief Executive Officer Doug Bauer. “During the quarter, we delivered 1,748 new homes, generating $1.2 billion in home sales revenue. With our homebuilding gross margin improving 40 basis points year-over-year to 23.3% and SG&A as a percentage of home sales revenue of 10.3%, we generated net income available to common stockholders of $129 million, or $1.37 per diluted share.”

“We also achieved several milestones for the full year, including delivering a record-high 6,460 new homes with net income available to common stockholders of $458 million, or $4.83 per diluted share, representing a 40% increase in diluted earnings per share year-over-year,” continued Mr. Bauer. “In addition, we generated record operating cash flows, redeemed $450 million in senior notes, and finished the year with the strongest balance sheet and liquidity in our history. Through these strong results and our disciplined capital allocation, including the repurchase of 4.0 million in shares outstanding through our stock repurchase program, we increased year-over-year book value per share by 14.5%.”

“We recognize that elevated mortgage rates in the fourth quarter caused some buyers to remain on the sidelines for the short-term, resulting in softer seasonal sales in the last part of 2024,” said Tom Mitchell, Tri Pointe Homes President and Chief Operating Officer. “However, we are seeing a weekly increase in demand and reduced incentives in the early part of 2025 and are optimistic for the spring selling season. We are confident that strong long-term fundamentals, including both favorable demographics and the ongoing supply and demand imbalance, position Tri Pointe Homes and our industry for ongoing success. As a company, we continue to invest in our core market strategy, focusing on A locations, a differentiated premium product offering, and an elevated customer experience. This commitment enables us to attract a well-qualified and resilient buyer profile who desires our product, reinforcing our long-term value proposition.”

Mr. Bauer concluded, “With a robust supply of over 36,000 total lots, we believe we are well-positioned to capitalize on the housing shortage and continue to grow our business, delivering strong cash flows and returns to stockholders. Our diverse product offerings, combined with the flexibility of our 54% optioned lot supply, enable us to adapt to changing market conditions and efficiently allocate capital to maximize earnings. Our strong balance sheet supports further capital returns through share repurchases, while maintaining the liquidity necessary to expand our market presence and pursue organic growth opportunities.”

Results and Operational Data for Fourth Quarter 2024 and Comparisons to Fourth Quarter 2023

• Net income available to common stockholders was $129.2 million, or $1.37 per diluted share, compared to $132.8 million, or $1.36 per diluted share
• Home sales revenue for the quarter was $1.2 billion, a decrease of 2%
  • New home deliveries of 1,748 homes compared to 1,813 homes, a decrease of 4%
  • Average sales price of homes delivered of $699,000 compared to $685,000, an increase of 2%
• Homebuilding gross margin percentage of 23.3% compared to 22.9%, an increase of 40 basis points
  • Excluding interest, impairments and lot option abandonments, adjusted homebuilding gross margin percentage was 26.8%*
• Selling, general and administrative (“SG&A”) expense as a percentage of homes sales revenue of 10.3% compared to 9.3%, an increase of 100 basis points
• Net new home orders of 940 compared to 1,078, a decrease of 13%
• Active selling communities averaged 146.8 compared to 159.3, a decrease of 8%
  • Net new home orders per average selling community decreased by 9% to 6.4 orders (2.1 monthly) compared to 6.8 orders (2.3 monthly)
  • Cancellation rate of 14% compared to 12%
• Backlog units at quarter end of 1,517 homes compared to 2,320, a decrease of 35%
  • Dollar value of backlog at quarter end of $1.2 billion compared to $1.6 billion, a decrease of 28%
  • Average sales price in backlog at quarter end of $768,000 compared to $695,000, an increase of 11%
• Ratios of homebuilding debt-to-capital and net homebuilding debt-to-net capital of 21.6% and (1.6)%*, respectively, as of December 31, 2024
• Repurchased 1,202,913 shares of common stock at an average price of $41.57 for an aggregate dollar amount of $50.0 million during the quarter ended December 31, 2024
• Announced a new stock repurchase program authorizing the repurchase of up to $250 million of common stock through December 31, 2025
• Ended fourth quarter of 2024 with total liquidity of $1.7 billion, including cash of $970.0 million and $694.1 million of availability under the Company’s unsecured revolving credit facility

*  See “Reconciliation of Non-GAAP Financial Measures”

Results and Operational Data for Full Year 2024 and Comparisons to Full Year 2023

• Net income available to common stockholders was $458.0 million, or $4.83 per diluted share, compared to $343.7 million, or $3.45 per diluted share
• Home sales revenue of $4.4 billion compared to $3.7 billion, an increase of 20%
  • New home deliveries of 6,460 homes compared to 5,274 homes, an increase of 22%
  • Average sales price of homes delivered of $679,000 compared to $693,000, a decrease of 2%
• Homebuilding gross margin percentage of 23.3% compared to 22.3%, an increase of 100 basis points
  • Excluding interest, impairments and lot option abandonments, adjusted homebuilding gross margin percentage was 26.8%*
• SG&A expense as a percentage of homes sales revenue of 10.8% compared to 11.0%, a decrease of 20 basis points
• Net new home orders of 5,657 compared to 6,122, a decrease of 8%
• Active selling communities averaged 150.4 compared to 147.5, an increase of 2%
  • Net new home orders per average selling community decreased by 11% to 37.6 orders (3.1 monthly) compared to 41.5 orders (3.5 monthly)
  • Cancellation rate of 10%, unchanged from the prior year
• Repurchased 3,964,537 shares of common stock at an average price of $36.97 for an aggregate dollar amount of $146.6 million during the full year ended December 31, 2024

*  See “Reconciliation of Non-GAAP Financial Measures”

Outlook

For the first quarter of 2025, the Company anticipates delivering between 900 and 1,100 homes at an average sales price between $685,000 and $695,000. The Company expects its homebuilding gross margin percentage to be in the range of 22.0% to 23.0% for the first quarter of 2025 and anticipates its SG&A expense as a percentage of home sales revenue will be in the range of 15.0% to 16.0%. Lastly, the Company expects its effective tax rate for the first quarter of 2025 to be approximately 26.0%.

For the full year of 2025, the Company anticipates delivering between 5,500 and 6,100 homes at an average sales price between $660,000 and $670,000. The Company expects its homebuilding gross margin percentage to be in the range of 20.5% to 22.0% for the full year of 2025 and anticipates its SG&A expense as a percentage of home sales revenue will be in the range of 11.0% to 12.0%. Lastly, the Company expects its effective tax rate for the year to be approximately 26.0%.

Earnings Conference Call

The Company will host a conference call via live webcast for investors and other interested parties beginning at 7:00 a.m. Pacific Time (10:00 a.m. Eastern Time) on Tuesday, February 18, 2025. The call will be hosted by Doug Bauer, Chief Executive Officer, Tom Mitchell, President and Chief Operating Officer, Glenn Keeler, Chief Financial Officer, and Linda Mamet, Executive Vice President and Chief Marketing Officer.

Interested parties can listen to the call live and view the related presentation slides on the internet through the Events & Presentations heading in the Investors section of the Company’s website at www.TriPointeHomes.com. Listeners should go to the website at least fifteen minutes prior to the call to download and install any necessary audio software. The call can also be accessed toll free at (877) 407-3982, or (201) 493-6780 for international participants. Participants should ask for the Tri Pointe Homes Fourth Quarter 2024 Earnings Conference Call. Those dialing in should do so at least ten minutes prior to the start of the call. A replay of the call will be available for one week following the call toll free at (844) 512-2921, or (412) 317-6671 for international participants, using the reference number 13751349. An archive of the webcast will also be available on the Company’s website for a limited time.

About Tri Pointe Homes®

One of the largest homebuilders in the U.S., Tri Pointe Homes, Inc. (NYSE: TPH) is a publicly traded company operating in 12 states and the District of Columbia, and is a recognized leader in customer experience, innovative design, and environmentally responsible business practices. The company builds premium homes and communities with deep ties to the communities it serves—some for as long as a century. Tri Pointe Homes combines the financial resources, technology platforms and proven leadership of a national organization with the regional insights, longstanding community connections and agility of empowered local teams. Tri Pointe has won multiple Builder of the Year awards and was named 2024 Developer of the Year. The company was also named to the 2024 Fortune World’s Most Admired Companies™ list, is one of the 2023 Fortune 100 Best Companies to Work For® and was designated as one of the PEOPLE Companies That Care® in 2023 and 2024. The company was also named as a Great Place To Work-Certified™ company for four years in a row (2021 through 2024), and was named on several Great Place To Work® Best Workplaces list (2022 through 2024). For more information, please visit TriPointeHomes.com.

Forward-Looking Statements

Various statements contained in this press release, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact, are forward-looking statements. These forward-looking statements may include, but are not limited to, statements regarding our strategy, projections and estimates concerning the timing and success of specific projects and our future production, land and lot sales, operational and financial results, including our estimates for growth, financial condition, sales prices, prospects, and capital spending. Forward-looking statements that are included in this press release are generally accompanied by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “future,” “goal,” “guidance,” “intend,” “likely,” “may,” “might,” “outlook,” “plan,” “potential,” “predict,” “project,” “should,” “strategy,” “target,” “will,” “would,” or other words that convey future events or outcomes. The forward-looking statements in this press release speak only as of the date of this press release, and we disclaim any obligation to update these statements unless required by law, and we caution you not to rely on them unduly. These forward-looking statements are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond our control. The following factors, among others, may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements: the effects of general economic conditions, including employment rates, housing starts, interest rate levels, availability of financing for home mortgages and strength of the U.S. dollar; market demand for our products, which is related to the strength of the various U.S. business segments and U.S. and international economic conditions; the availability of desirable and reasonably priced land and our ability to control, purchase, hold and develop such parcels; access to adequate capital on acceptable terms; geographic concentration of our operations, particularly within California; levels of competition; the successful execution of our internal performance plans, including restructuring and cost reduction initiatives; the prices and availability of supply chain inputs, including raw materials and labor; oil and other energy prices; the effects of U.S. trade policies, including the imposition of tariffs and duties on homebuilding products and retaliatory measures taken by other countries; the effects of weather, including the occurrence of drought conditions in California; the risk of loss from earthquakes, volcanoes, fires, floods, droughts, windstorms, hurricanes, pest infestations and other natural disasters, and the risk of delays, reduced consumer demand, and shortages and price increases in labor or materials associated with such natural disasters; the risk of loss from acts of war, terrorism, civil unrest or public health emergencies, including outbreaks of contagious diseases, such as COVID-19; transportation costs; federal and state tax policies; the effects of land use, environment and other governmental laws and regulations; legal proceedings or disputes and the adequacy of reserves; risks relating to any unforeseen changes to or effects on liabilities, future capital expenditures, revenues, expenses, earnings, synergies, indebtedness, financial condition, losses and future prospects; changes in accounting principles; risks related to unauthorized access to our computer systems, theft of our homebuyers’ confidential information or other forms of cyber-attack; and additional factors discussed under the sections captioned “Risk Factors” included in our annual and quarterly reports filed with the Securities and Exchange Commission. The foregoing list is not exhaustive. New risk factors may emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business.

Investor Relations Contact:	Media Contact:
InvestorRelations@TriPointeHomes.com, 949-478-8696	Carol Ruiz, cruiz@newgroundco.com, 310-437-0045

KEY OPERATIONS AND FINANCIAL DATA (dollars in thousands) (unaudited)
	Three Months Ended December 31,															Year Ended December 31,
		2024				2023			Change				% Change				2024				2023			Change				% Change
Operating Data:
Home sales revenue	$	1,221,405			$	1,241,258			$	(19,853	)		(2	)%		$	4,386,447			$	3,654,035			$	732,412			20	%
Homebuilding gross margin	$	285,008			$	283,936			$	1,072			0	%		$	1,022,566			$	815,522			$	207,044			25	%
Homebuilding gross margin %		23.3	%			22.9	%			0.4	%						23.3	%			22.3	%			1.0	%
Adjusted homebuilding gross margin %*		26.8	%			26.5	%			0.3	%						26.8	%			25.9	%			0.9	%
SG&A expense	$	125,975			$	115,456			$	10,519			9	%		$	472,556			$	402,382			$	70,174			17	%
SG&A expense as a % of home sales revenue		10.3	%			9.3	%			1.0	%						10.8	%			11.0	%		(0.2		)%
Net income available to common stockholders	$	129,213			$	132,834			$	(3,621	)		(3	)%		$	458,029			$	343,702			$	114,327			33	%
Adjusted EBITDA*	$	235,307			$	236,146			$	(839	)		0	%		$	835,837			$	639,727			$	196,110			31	%
Interest incurred	$	23,162			$	35,377			$	(12,215	)		(35	)%		$	114,949			$	147,169			$	(32,220	)		(22	)%
Interest in cost of home sales	$	41,217			$	43,516			$	(2,299	)		(5	)%		$	148,547			$	116,143			$	32,404			28	%
Other Data:
Net new home orders		940				1,078				(138	)		(13	)%			5,657				6,122				(465	)		(8	)%
New homes delivered		1,748				1,813				(65	)		(4	)%			6,460				5,274				1,186			22	%
Average sales price of homes delivered	$	699			$	685			$	14			2	%		$	679			$	693			$	(14	)		(2	)%
Cancellation rate		14	%			12	%			2	%						10	%			10	%			0	%
Average selling communities		146.8				159.3				(12.5	)		(8	)%			150.4				147.5				2.9			2	%
Selling communities at end of period		145				155				(10	)		(6	)%
Backlog (estimated dollar value)	$	1,164,602			$	1,612,114			$	(447,512	)		(28	)%
Backlog (homes)		1,517				2,320				(803	)		(35	)%
Average sales price in backlog	$	768			$	695			$	73			11	%
	December 31, 2024				December 31, 2023				Change
Balance Sheet Data:
Cash and cash equivalents	$	970,045			$	868,953			$	101,092
Real estate inventories	$	3,153,459			$	3,337,483			$	(184,024	)
Lots owned or controlled		36,490				31,960				4,530
Homes under construction (1)		2,386				3,088				(702	)
Homes completed, unsold		464				263				201
Total homebuilding debt	$	917,504			$	1,382,586			$	(465,082	)
Stockholders' equity	$	3,335,710			$	3,010,958			$	324,752
Book capitalization	$	4,253,214			$	4,393,544			$	(140,330	)
Ratio of homebuilding debt-to-capital		21.6	%			31.5	%		(9.9		)%
Ratio of net homebuilding debt-to-capital*	(1.6		)%			14.6	%		(16.2		)%

_____________________________________
⁽¹⁾  Homes under construction included 43 and 69 models at December 31, 2024 and December 31, 2023, respectively.
*    See “Reconciliation of Non-GAAP Financial Measures”

CONSOLIDATED BALANCE SHEETS (in thousands, except share amounts)
	December 31, 2024			December 31, 2023
Assets	(unaudited)
Cash and cash equivalents	$	970,045		$	868,953
Receivables		111,613			224,636
Real estate inventories		3,153,459			3,337,483
Investments in unconsolidated entities		173,924			131,824
Mortgage loans held for sale		115,001			—
Goodwill and other intangible assets, net		156,603			156,603
Deferred tax assets, net		45,975			37,996
Other assets		164,495			157,093
Total assets	$	4,891,115		$	4,914,588
Liabilities
Accounts payable	$	68,228		$	64,833
Accrued expenses and other liabilities		465,563			453,531
Loans payable		270,970			288,337
Senior notes, net		646,534			1,094,249
Mortgage repurchase facilities		104,098			—
Total liabilities		1,555,393			1,900,950
Commitments and contingencies
Equity
Stockholders' Equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized; no   shares issued and outstanding as of December 31, 2024 and   December 31, 2023, respectively		—			—
Common stock, $0.01 par value, 500,000,000 shares authorized;   92,451,729 and 95,530,512 shares issued and outstanding at   December 31, 2024 and December 31, 2023, respectively		925			955
Additional paid-in capital		—			—
Retained earnings		3,334,785			3,010,003
Total stockholders' equity		3,335,710			3,010,958
Noncontrolling interests		12			2,680
Total equity		3,335,722			3,013,638
Total liabilities and equity	$	4,891,115		$	4,914,588

CONSOLIDATED STATEMENT OF OPERATIONS (in thousands, except share and per share amounts) (unaudited)
	Three Months Ended December 31,								Year Ended December 31,
		2024				2023				2024				2023
Homebuilding:
Home sales revenue	$	1,221,405			$	1,241,258			$	4,386,447			$	3,654,035
Land and lot sales revenue		9,284				1,691				33,064				12,197
Other operations revenue		803				752				3,162				2,971
Total revenues		1,231,492				1,243,701				4,422,673				3,669,203
Cost of home sales		936,397				957,322				3,363,881				2,838,513
Cost of land and lot sales		9,007				1,796				30,591				12,083
Other operations expense		766				723				3,061				2,894
Sales and marketing		55,746				56,411				216,518				184,388
General and administrative		70,229				59,045				256,038				217,994
Homebuilding income from operations		159,347				168,404				552,584				413,331
Equity in (loss) income of unconsolidated entities		(22	)			(369	)			361				(97	)
Other income, net		7,822				9,085				39,640				39,446
Homebuilding income before income taxes		167,147				177,120				592,585				452,680
Financial Services:
Revenues		22,379				15,997				70,197				46,001
Expenses		14,014				11,959				45,914				31,322
Financial services income before income taxes		8,365				4,038				24,283				14,679
Income before income taxes		175,512				181,158				616,868				467,359
Provision for income taxes		(46,299	)			(46,400	)			(158,898	)			(118,164	)
Net income		129,213				134,758				457,970				349,195
Net (income) loss attributable to noncontrolling interests		—				(1,924	)			59				(5,493	)
Net income available to common stockholders	$	129,213			$	132,834			$	458,029			$	343,702
Earnings per share
Basic	$	1.39			$	1.38			$	4.87			$	3.48
Diluted	$	1.37			$	1.36			$	4.83			$	3.45
Weighted average shares outstanding
Basic		93,064,520				96,142,092				93,985,551				98,679,477
Diluted		94,413,552				97,438,742				94,912,589				99,695,662

MARKET DATA BY REPORTING SEGMENT & STATE (dollars in thousands) (unaudited)
	Three Months Ended December 31,										Year Ended December 31,
	2024					2023					2024					2023
	New Homes Delivered		Average Sales Price			New Homes Delivered		Average Sales Price			New Homes Delivered		Average Sales Price			New Homes Delivered		Average Sales Price
Arizona	144		$	709		133		$	764		516		$	723		630		$	781
California	635			775		870			722		2,242			768		1,986			745
Nevada	119			571		108			670		482			618		397			729
Washington	74			993		67			889		271			914		173			848
West total	972			757		1,178			731		3,511			752		3,186			756
Colorado	29			703		34			684		162			707		144			738
Texas	495			563		366			553		1,827			555		1,141			561
Central total	524			571		400			564		1,989			567		1,285			581
Carolinas(1)	158			505		177			466		684			488		616			458
Washington D.C. Area(2)	94			1,133		58			1,233		276			1,028		187			1,159
East total	252			739		235			655		960			643		803			621
Total	1,748		$	699		1,813		$	685		6,460		$	679		5,274		$	693
	Three Months Ended December 31,										Year Ended December 31,
	2024					2023					2024					2023
	Net New Home Orders		Average Selling Communities			Net New Home Orders		Average Selling Communities			Net New Home Orders		Average Selling Communities			Net New Home Orders		Average Selling Communities
Arizona	98			13.7		76			13.5		562			13.8		511			13.5
California	278			42.0		390			46.6		1,885			43.5		2,386			49.6
Nevada	69			8.5		68			11.3		412			8.6		403			9.2
Washington	45			5.8		62			5.3		281			5.6		228			5.4
West total	490			70.0		596			76.7		3,140			71.5		3,528			77.7
Colorado	25			10.0		24			11.0		129			10.5		142			8.4
Texas	282			49.5		303			54.3		1,578			51.1		1,565			43.8
Central total	307			59.5		327			65.3		1,707			61.6		1,707			52.2
Carolinas(1)	75			9.3		100			13.0		489			10.5		678			14.0
Washington D.C. Area(2)	68			8.0		55			4.3		321			6.8		209			3.6
East total	143			17.3		155			17.3		810			17.3		887			17.6
Total	940			146.8		1,078			159.3		5,657			150.4		6,122			147.5

MARKET DATA BY REPORTING SEGMENT & STATE, continued (dollars in thousands) (unaudited)
	As of December 31, 2024								As of December 31, 2023
	Backlog Units		Backlog Dollar Value			Average Sales Price			Backlog Units		Backlog Dollar Value			Average Sales Price
Arizona	305		$	245,417		$	805		259		$	190,798		$	737
California	341			257,199			754		698			559,729			802
Nevada	61			36,031			591		131			91,012			695
Washington	100			114,418			1,144		90			79,672			885
West total	807			653,065			809		1,178			921,211			782
Colorado	15			11,684			779		48			32,963			687
Texas	457			269,693			590		706			409,769			580
Central total	472			281,377			596		754			442,732			587
Carolinas(1)	87			53,168			611		282			140,523			498
Washington D.C. Area(2)	151			176,992			1,172		106			107,648			1,016
East total	238			230,160			967		388			248,171			640
Total	1,517		$	1,164,602		$	768		2,320		$	1,612,114		$	695
	December 31, 2024		December 31, 2023
Lots Owned or Controlled:
Arizona	2,099			2,394
California	10,291			10,148
Nevada	1,437			1,785
Washington	597			712
West total	14,424			15,039
Colorado	1,561			1,908
Texas	12,711			10,056
Utah	1,006			—
Central total	15,278			11,964
Carolinas(1)	5,004			4,038
Florida	252			—
Washington D.C. Area(2)	1,532			919
East total	6,788			4,957
Total	36,490			31,960
	December 31, 2024		December 31, 2023
Lots by Ownership Type:
Lots owned	16,609			18,739
Lots controlled (1)	19,881			13,221
Total	36,490			31,960

__________
⁽¹⁾  As of December 31, 2024 and 2023, lots controlled included lots that were under land option contracts or purchase contracts. As of December 31, 2024 and 2023, lots controlled for Central include 5,816 and 3,561 lots, respectively, and lots controlled for East include 14 and 71 lots, respectively, which represent our expected share of lots owned by our investments in unconsolidated land development joint ventures.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited)

In this press release, we utilize certain financial measures that are non-GAAP financial measures as defined by the Securities and Exchange Commission. We present these measures because we believe they and similar measures are useful to management and investors in evaluating the Company’s operating performance and financing structure. We also believe these measures facilitate the comparison of our operating performance and financing structure with other companies in our industry. Because these measures are not calculated in accordance with Generally Accepted Accounting Principles (“GAAP”), they 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.

The following tables reconcile homebuilding gross margin percentage, as reported and prepared in accordance with GAAP, to the non-GAAP financial measure adjusted homebuilding gross margin percentage. We believe this information is meaningful as it isolates the impact that leverage and non-cash impairments and lot option abandonments, as applicable, have on homebuilding gross margin and permits investors to make better comparisons with our competitors, who may adjust gross margins in a similar fashion.

	Three Months Ended December 31,
		2024			%				2023			%
	(dollars in thousands)
Home sales revenue	$	1,221,405			100.0	%		$	1,241,258			100.0	%
Cost of home sales		936,397			76.7	%			957,322			77.1	%
Homebuilding gross margin		285,008			23.3	%			283,936			22.9	%
Add:  interest in cost of home sales		41,217			3.4	%			43,516			3.5	%
Add:  impairments and lot option abandonments		1,713			0.1	%			1,482			0.1	%
Adjusted homebuilding gross margin	$	327,938			26.8	%		$	328,934			26.5	%
Homebuilding gross margin percentage		23.3	%						22.9	%
Adjusted homebuilding gross margin percentage		26.8	%						26.5	%

	Year Ended December 31,
		2024			%				2023			%
	(dollars in thousands)
Home sales revenue	$	4,386,447			100.0	%		$	3,654,035			100.0	%
Cost of home sales		3,363,881			76.7	%			2,838,513			77.7	%
Homebuilding gross margin		1,022,566			23.3	%			815,522			22.3	%
Add:  interest in cost of home sales		148,547			3.4	%			116,143			3.2	%
Add:  impairments and lot option abandonments		4,157			0.1	%			14,157			0.4	%
Adjusted homebuilding gross margin	$	1,175,270			26.8	%		$	945,822			25.9	%
Homebuilding gross margin percentage		23.3	%						22.3	%
Adjusted homebuilding gross margin percentage		26.8	%						25.9	%

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued) (unaudited)

The following table reconciles the Company’s ratio of homebuilding debt-to-capital to the non-GAAP ratio of net homebuilding debt-to-net capital. We believe that the ratio of net homebuilding debt-to-net capital is a relevant financial measure for management and investors to understand the leverage employed in our operations and as an indicator of the Company’s ability to obtain financing.

	December 31, 2024				December 31, 2023
Loans payable	$	270,970			$	288,337
Senior notes		646,534				1,094,249
Mortgage repurchase facilities		104,098				—
Total debt		1,021,602				1,382,586
Less: mortgage repurchase facilities		(104,098	)			—
Total homebuilding debt		917,504				1,382,586
Stockholders’ equity		3,335,710				3,010,958
Total capital	$	4,253,214			$	4,393,544
Ratio of homebuilding debt-to-capital(1)		21.6	%			31.5	%
Total homebuilding debt	$	917,504			$	1,382,586
Less: Cash and cash equivalents		(970,045	)			(868,953	)
Net homebuilding debt		(52,541	)			513,633
Stockholders’ equity		3,335,710				3,010,958
Net capital	$	3,283,169			$	3,524,591
Ratio of net homebuilding debt-to-net capital(2)	(1.6		)%			14.6	%

__________
⁽¹⁾  The ratio of homebuilding debt-to-capital is computed as the quotient obtained by dividing total homebuilding debt by the sum of total homebuilding debt plus stockholders’ equity.
⁽²⁾  The ratio of net homebuilding debt-to-net capital is computed as the quotient obtained by dividing net homebuilding debt (which is total homebuilding debt less cash and cash equivalents) by the sum of net homebuilding debt plus stockholders’ equity.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued) (unaudited)

The following table calculates the non-GAAP financial measures of EBITDA and Adjusted EBITDA and reconciles those amounts to net income available to common stockholders, as reported and prepared in accordance with GAAP. EBITDA means net income available to common stockholders before (a) interest expense, (b) expensing of previously capitalized interest included in costs of home sales, (c) income taxes and (d) depreciation and amortization. Adjusted EBITDA means EBITDA before (e) amortization of stock-based compensation and (f) real estate inventory impairments and lot option abandonments. Other companies may calculate EBITDA and Adjusted EBITDA (or similarly titled measures) differently. We believe EBITDA and Adjusted EBITDA are useful measures of the Company’s ability to service debt and obtain financing.

	Three Months Ended December 31,								Year Ended December 31,
		2024				2023				2024				2023
	(in thousands)
Net income available to common stockholders	$	129,213			$	132,834			$	458,029			$	343,702
Interest expense:
Interest incurred		23,162				35,377				114,949				147,169
Interest capitalized		(23,162	)			(35,377	)			(114,949	)			(147,169	)
Amortization of interest in cost of sales		41,454				43,737				150,226				116,933
Provision for income taxes		46,299				46,400				158,898				118,164
Depreciation and amortization		7,446				6,786				31,018				26,852
EBITDA		224,412				229,757				798,171				605,651
Amortization of stock-based compensation		9,182				4,907				33,509				19,919
Real estate inventory impairments and lot option abandonments		1,713				1,482				4,157				14,157
Adjusted EBITDA	$	235,307			$	236,146			$	835,837			$	639,727