• Tri Pointe Homes, Inc. Reports 2021 Fourth Quarter and Full Year Results and Announces $250 Million Increase to Its Stock Repurchase Program

    ソース: Nasdaq GlobeNewswire / 17 2 2022 06:00:01   America/New_York

    Fourth Quarter Highlights

    -Diluted Earnings Per Share of $1.33, Up 45% Year-Over-Year-
    -Pre-tax Margin of 16.2%-
    -Backlog Dollar Value of $2.2 Billion, up 17% Year-Over-Year-
    -Return on Average Equity of 20.3%*-

    INCLINE VILLAGE, Nev., Feb. 17, 2022 (GLOBE NEWSWIRE) -- Tri Pointe Homes, Inc. (the “Company”) (NYSE: TPH) today announced results for the fourth quarter ended December 31, 2021 and full year 2021. The Company also announced that its Board of Directors has authorized the repurchase of up to an additional $250 million of common stock under its existing stock repurchase program (“Repurchase Program”), increasing the aggregate authorization under the Repurchase Program from $500 million to $750 million.

    “Tri Pointe Homes had a record-breaking 2021 in terms of profitability and a company-best return on average equity of 20.3%,” said Doug Bauer, Chief Executive Officer of Tri Pointe Homes. “We ended the year on a high note, generating fourth quarter earnings of $1.33 per diluted share, a 45% year-over-year improvement. We also met or exceeded our previously stated guidance for key operational metrics for the quarter due in large part to the excellent job that our team members’ did navigating the supply chain challenges that persist in our industry.”

    “The factors that contributed to our fourth quarter success continue to provide momentum, including demand for new homes that has outstripped supply across our markets. We continue to see motivated buyers across our geographic footprint, driven in part by strong demographics and an overall change in attitude towards home ownership brought on by the pandemic, both of which we believe are long-term shifts. We believe that these persisting trends, combined with the limited supply of existing home inventory available for sale, make for a promising outlook for our industry.”

    Bauer concluded, “Tri Pointe Homes is poised to build on the record-breaking success we experienced in 2021. We had 50% more lots under control at the end of 2021 than we did in the prior-year, which should provide us with a strong runway for future growth. In addition, our strong balance sheet and sizable backlog give us a favorable market position going forward, making me extremely optimistic about the future of Tri Pointe Homes.”

    Results and Operational Data for Fourth Quarter 2021 and Comparisons to Fourth Quarter 2020

    • Net income was $147.4 million, or $1.33 per diluted share, compared to $115.1 million, or $0.92 per diluted share
    • Home sales revenue for the quarter was $1.2 billion, an increase of 15%
      • New home deliveries of 1,885 homes compared to 1,633 homes, an increase of 15%
      • Average sales price of homes delivered of $637,000 compared to $640,000
    • Homebuilding gross margin percentage of 24.4% compared to 23.2%, an increase of 120 basis points, which includes $20.1 million of impairments and lot option abandonments
      • Excluding interest, impairments and lot option abandonments, adjusted homebuilding gross margin percentage was 28.1%**
    • Selling, general and administrative (“SG&A”) expense as a percentage of homes sales revenue of 8.5% compared to 9.9%, a decrease of 140 basis points
    • Net new home orders of 1,424 compared to 1,409, an increase of 1%
    • Active selling communities averaged 110.5 compared to 117.5, a decrease of 6%
      • Net new home orders per average selling community increased by 1% to 12.9 orders (4.3 monthly) compared to 12.0 orders (4.0 monthly)
      • Cancellation rate of 9% compared to 10%
    • Backlog units at quarter end of 3,158 homes compared to 2,964, an increase of 7%
      • Dollar value of backlog at quarter end of $2.2 billion compared to $1.9 billion, an increase of 17%
      • Average sales price in backlog at quarter end of $710,000 compared to $647,000, an increase of 10%
    • Ratios of debt-to-capital and net debt-to-net capital of 35.3% and 21.1%**, respectively, as of December 31, 2021
    • Repurchased 2,762,900 shares of common stock at an average price of $22.64 for an aggregate dollar amount of $62.6 million in the three months ended December 31, 2021
    • Ended fourth quarter of 2021 with total liquidity of $1.3 billion, including cash of $681.5 million and $601.1 million of availability under the Company’s unsecured revolving credit facility

      * Return on average equity is calculated as net income for the trailing twelve months divided by average stockholders’ equity for the trailing five quarters
      ** See “Reconciliation of Non-GAAP Financial Measures”

    Results and Operational Data for Full Year 2021 and Comparisons to Full Year 2020

    • Net income was $469.3 million, or $4.12 per diluted share, compared to $282.2 million, or $2.17 per diluted share
    • Home sales revenue of $4.0 billion compared to $3.2 billion, an increase of 22%
      • New home deliveries of 6,188 homes compared to 5,123 homes, an increase of 21%
      • Average sales price of homes delivered of $639,000 compared to $631,000, an increase of 1%
    • Homebuilding gross margin percentage of 24.9% compared to 22.0%, an increase of 290 basis points, which includes $20.8 million of impairments and lot option abandonments
      • Excluding interest, impairments and lot option abandonments, adjusted homebuilding gross margin percentage was 27.9%**
    • SG&A expense as a percentage of homes sales revenue of 9.6% compared to 10.8%, a decrease of 120 basis points
    • Net new home orders of 6,382 compared to 6,335, an increase of 1%
    • Active selling communities averaged 111.8 compared to 133.2, a decrease of 16%
      • Net new home orders per average selling community increased by 20% to 57.1 orders (4.8 monthly) compared to 47.6 orders (4.0 monthly)
      • Cancellation rate of 8% compared to 13%,
    • Repurchased 13,063,465 shares of common stock at an average price of $21.13 for an aggregate dollar amount of $276.0 million in the full year ended December 31, 2021

      ** See “Reconciliation of Non-GAAP Financial Measures”

    “Our sales pace for the fourth quarter came in at 4.3 homes per community per month, which is well above seasonal norms for that time of year,” said Tri Pointe Homes President and Chief Operating Officer Tom Mitchell. “Demand was consistent company-wide, as each of our regions registered a sales pace above 3.9. We believe this is a testament to the innovative design and broad-based appeal of our homes as well as our strong market positioning. Last year’s successful one-brand initiative simplified our marketing processes across our divisions, while amplifying our unified brand across the country. We feel these factors have positioned Tri Pointe for continuing success into 2022 and beyond.”

    Outlook

    For the first quarter of 2022, the Company anticipates delivering between 900 and 1,100 homes at an average sales price between $650,000 and $660,000. The Company expects its homebuilding gross margin percentage to be in the range of 25.0% to 26.0% for the first quarter of 2022 and anticipates its SG&A expense as a percentage of home sales revenue will be in the range of 13.0% to 13.5%. Lastly, the Company expects its effective tax rate for the first quarter of 2022 to be in the range of 25.0% to 26.0%.

    For the full year, the Company expects to open between 90 and 100 new communities and end the year with between 150 and 160 active selling communities. In addition, the Company anticipates delivering between 6,500 and 6,800 homes at an average sales price between $660,000 and $670,000. The Company expects homebuilding gross margin percentage to be in the range of 25.0% to 26.0% for the full year and anticipates its SG&A expense as a percentage of homes sales revenue will be in the range of 9.7% to 10.2%. Finally, the Company expects its effective tax rate for the full year to be in the range of 25.0% to 26.0%.

    Stock Repurchase Program

    On February 16, 2022, the Company’s Board of Directors approved the repurchase of up to an additional $250 million of Company common stock pursuant to its Repurchase Program. As of February 16, 2022, the Company had purchased an aggregate of 18,278,907 shares of common stock for approximately $387.6 million pursuant to the Repurchase Program. Under the Repurchase Program as amended, the Company may repurchase shares of its outstanding common stock with an aggregate value of up to $750 million through December 31, 2022. Purchases of common stock pursuant to the Repurchase Program may be made in open market transactions effected through a broker-dealer at prevailing market prices, in block trades, or by other means in accordance with federal securities laws, including pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934, as amended. The Company is not obligated under the Repurchase Program to repurchase any specific number or amount of shares of common stock, and it may modify, suspend or discontinue the program at any time. Company management will determine the timing and amount of repurchase in its discretion based on a variety of factors, such as the market price of the Company’s common stock, corporate requirements, general market economic conditions and legal requirements.

    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 Thursday, February 17, 2022. The call will be hosted by Doug Bauer, Chief Executive Officer, Tom Mitchell, President and Chief Operating Officer, and Glenn Keeler, Chief Financial 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 2021 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 two weeks following the call toll free at (844) 512-2921, or (412) 317-6671 for international participants, using the reference number 13726044. An archive of the webcast will also be available on the Company’s website for a limited time.

    About Tri Pointe Homes, Inc.

    One of the largest homebuilders in the U.S., Tri Pointe Homes, Inc.® (NYSE: TPH) is a publicly traded company and a recognized leader in customer experience, innovative design, and environmentally responsible business practices. The company builds premium homes and communities in 10 states, 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, most recently in 2019, and made Fortune magazine’s 2017 100 Fastest-Growing Companies list. Named one of the Best Places to Work by the Orange County Business Journal for four consecutive years, Tri Pointe Homes also became a Great Place to Work-Certified™ company in 2021. 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 the ongoing COVID-19 pandemic, which are highly uncertain and subject to rapid change, cannot be predicted and will depend upon future developments, including the emergence and spread of new strains or variants of COVID-19, the severity and the duration of the outbreak, the duration of existing and future social distancing and shelter-in-place orders, further mitigation strategies taken by applicable government authorities, the availability and acceptance of effective vaccines, adequate testing and treatments and the prevalence of widespread immunity to COVID-19; the impacts on our supply chain, the health of our employees, service providers and trade partners, and the reactions of U.S. and global markets and their effects on consumer confidence and spending; 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 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:
      
    Drew Mackintosh, Mackintosh Investor RelationsCarol Ruiz, cruiz@newgroundco.com 310-437-0045
    InvestorRelations@TriPointeHomes.com 949-478-8696 
      

    KEY OPERATIONS AND FINANCIAL DATA
    (dollars in thousands)
    (unaudited)

     Three Months Ended December 31, Year Ended December 31,
      2021   2020  Change % Change  2021   2020  Change % Change
    Operating Data:               
    Home sales revenue$1,200,222  $1,045,020  $155,202  15% $3,955,154  $3,232,836  $722,318  22%
    Homebuilding gross margin$292,580  $242,002  $50,578  21% $982,917  $712,046  $270,871  38%
    Homebuilding gross margin % 24.4%  23.2%  1.2%    24.9%  22.0%  2.9%  
    Adjusted homebuilding gross margin %* 28.1%  26.3%  1.8%    27.9%  25.0%  2.9%  
    SG&A expense$102,451  $103,155  $(704) (1)% $379,377  $349,414  $29,963  9%
    SG&A expense as a % of home sales revenue 8.5%  9.9%  (1.4)%    9.6%  10.8%  (1.2)%  
    Net income$147,440  $115,114  $32,326  28% $469,267  $282,207  $187,060  66%
    Adjusted EBITDA*$257,365  $203,396  $53,969  27% $801,310  $532,915  $268,395  50%
    Interest incurred$24,766  $20,450  $4,316  21% $92,783  $83,120  $9,663  12%
    Interest in cost of home sales$23,991  $31,013  $(7,022) (23)% $101,176  $93,131  $8,045  9%
                    
    Other Data:               
    Net new home orders 1,424   1,409   15  1%  6,382   6,335   47  1%
    New homes delivered 1,885   1,633   252  15%  6,188   5,123   1,065  21%
    Average selling price of homes delivered$637  $640  $(3) 0% $639  $631  $8  1%
    Cancellation rate 9%  10%  (1)%    8%  13%  (5)%  
    Average selling communities 110.5   117.5   (7.0) (6)%  111.8   133.2   (21.4) (16)%
    Selling communities at end of period 112   112   0  0%        
    Backlog (estimated dollar value)$2,242,159  $1,916,664  $325,495  17%        
    Backlog (homes) 3,158   2,964   194  7%        
    Average selling price in backlog$710  $647  $63  10%        
                    
     December 31,
    2021    		 December 31,
    2020    		 Change          
    Balance Sheet Data:               
    Cash and cash equivalents$681,528  $621,295  $60,233           
    Real estate inventories$3,054,743  $2,910,142  $144,601           
    Lots owned or controlled 41,675   35,641   6,034           
    Homes under construction (1) 3,632   3,044   588           
    Homes completed, unsold 27   68   (41)          
    Total debt, net$1,337,723  $1,343,001  $(5,278)          
    Stockholders' equity$2,447,621  $2,232,537  $215,084           
    Book capitalization$3,785,344  $3,575,538  $209,806           
    Ratio of debt-to-capital 35.3%  37.6%  (2.3)%          
    Ratio of net debt-to-net-capital* 21.1%  24.4%  (3.3)%          

    _____________________________________
    (1) Homes under construction included 85 and 86 models at December 31, 2021 and December 31, 2020, respectively.
    * See “Reconciliation of Non-GAAP Financial Measures”


    CONSOLIDATED BALANCE SHEETS
    (in thousands, except share amounts)

      December 31,
    2021    		 December 31,
    2020
    Assets (unaudited)  
    Cash and cash equivalents $681,528  $621,295 
    Receivables  116,996   63,551 
    Real estate inventories  3,054,743   2,910,142 
    Investments in unconsolidated entities  118,095   75,056 
    Goodwill and other intangible assets, net  156,603   158,529 
    Deferred tax assets, net  57,096   47,525 
    Other assets  151,162   145,882 
    Total assets $4,336,223  $4,021,980 
         
    Liabilities    
    Accounts payable $84,854  $79,690 
    Accrued expenses and other liabilities  466,013   366,740 
    Loans payable  250,504   258,979 
    Senior notes  1,087,219   1,084,022 
    Total liabilities  1,888,590   1,789,431 
         
    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, 2021 and December 31, 2020, respectively  —   — 
    Common stock, $0.01 par value, 500,000,000 shares authorized; 109,644,474 and 121,882,778 shares issued and outstanding at December 31, 2021 and December 31, 2020, respectively  1,096   1,219 
    Additional paid-in capital  91,077   345,137 
    Retained earnings  2,355,448   1,886,181 
    Total stockholders' equity  2,447,621   2,232,537 
    Noncontrolling interests  12   12 
    Total equity  2,447,633   2,232,549 
    Total liabilities and equity $4,336,223  $4,021,980 


    CONSOLIDATED STATEMENT OF OPERATIONS
    (in thousands, except share and per share amounts)
    (unaudited)

     Three Months Ended
    December 31,    		 Year Ended
    December 31,
      2021   2020   2021   2020 
    Homebuilding:       
    Home sales revenue$1,200,222  $1,045,020  $3,955,154  $3,232,836 
    Land and lot sales revenue 5,496   12,470   13,016   15,932 
    Other operations revenue 650   642   2,619   2,542 
    Total revenues 1,206,368   1,058,132   3,970,789   3,251,310 
    Cost of home sales 907,642   803,018   2,972,237   2,520,790 
    Cost of land and lot sales 5,667   2,653   11,585   6,443 
    Other operations expense 439   624   2,550   2,496 
    Sales and marketing 48,390   50,565   179,214   183,110 
    General and administrative 54,061   52,590   200,163   166,304 
    Restructuring charges —   58   —   5,661 
    Homebuilding income from operations 190,169   148,624   605,040   366,506 
    Equity in (loss) income of unconsolidated entities (24)  95   (96)  162 
    Other income (expense), net 97   97   525   (8,978)
    Homebuilding income before income taxes 190,242   148,816   605,469   357,690 
    Financial Services:       
    Revenues 3,644   2,695   11,446   9,137 
    Expenses 1,782   1,417   6,292   5,115 
    Equity in income of unconsolidated entities 4,453   3,904   15,039   11,665 
    Financial services income before income taxes 6,315   5,182   20,193   15,687 
    Income before income taxes 196,557   153,998   625,662   373,377 
    Provision for income taxes (49,117)  (38,884)  (156,395)  (91,170)
    Net income$147,440  $115,114  $469,267  $282,207 
    Earnings per share       
    Basic$1.34  $0.93  $4.16  $2.18 
    Diluted$1.33  $0.92  $4.12  $2.17 
    Weighted average shares outstanding       
    Basic 109,911,768   123,944,552   112,836,051   129,368,964 
    Diluted 111,126,846   124,815,177   113,809,292   129,951,161 


    MARKET DATA BY REPORTING SEGMENT & STATE
    (dollars in thousands)
    (unaudited)

     Three Months Ended December 31, Year Ended December 31,
     2021 2020 2021 2020
     New
    Homes
    Delivered    		 Average
    Sales
    Price    		 New
    Homes
    Delivered    		 Average
    Sales
    Price    		 New
    Homes
    Delivered    		 Average
    Sales
    Price    		 New
    Homes
    Delivered    		 Average
    Sales
    Price
    Arizona218 $703 189 $601 788 $677 664 $553
    California745  639 700  687 2,608  664 2,010  721
    Nevada146  718 204  602 527  637 525  561
    Washington73  989 116  973 296  986 286  928
    West total1,182  682 1,209  687 4,219  686 3,485  682
    Colorado77  650 53  597 231  606 219  594
    Texas360  509 212  441 1,081  491 910  459
    Central total437  534 265  472 1,312  512 1,129  485
    Maryland120  543 108  523 323  554 336  553
    North Carolina32  462 7  363 85  419 7  363
    South Carolina18  370 5  325 29  357 5  325
    Virginia96  768 39  747 220  751 161  739
    East total266  603 159  565 657  594 509  607
    Total1,885 $637 1,633 $640 6,188 $639 5,123 $631
                    
     Three Months Ended December 31, Year Ended December 31,
     2021 2020 2021 2020
     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
    Arizona153  11.7 167  15.8 829  13.8 813  16.9
    California521  40.0 559  40.0 2,386  39.2 2,716  48.5
    Nevada149  10.0 111  13.7 717  10.9 524  14.8
    Washington57  5.8 27  5.5 286  5.7 336  7.5
    West total880  67.5 864  75.0 4,218  69.6 4,389  87.7
    Colorado71  7.8 64  4.8 289  6.2 245  4.3
    Texas274  21.7 306  26.0 1,219  22.3 1,063  29.0
    Central total345  29.5 370  30.8 1,508  28.5 1,308  33.3
    Maryland56  4.3 86  6.5 205  5.1 420  8.2
    North Carolina78  3.7 19  0.7 169  2.2 19  0.2
    South Carolina13.0  1.0 2  1.0 51.0  1.3 8  0.3
    Virginia52  4.5 68  3.5 231  5.1 191  3.5
    East total199  13.5 175  11.7 656  13.7 638  12.2
    Total1,424  110.5 1,409  117.5 6,382  111.8 6,335  133.2


    MARKET DATA BY REPORTING SEGMENT & STATE, continued
    (dollars in thousands)
    (unaudited)

      As of December 31, 2021 As of December 31, 2020
      Backlog
    Units    		 Backlog
    Dollar
    Value    		 Average
    Sales
    Price    		 Backlog
    Units    		 Backlog
    Dollar
    Value    		 Average
    Sales
    Price
    Arizona 520 $401,257 $772 479 $324,410 $677
    California 1,036  774,901  748 1,258  855,261  680
    Nevada 326  237,712  729 136  95,963  706
    Washington 129  133,317  1,033 139  139,435  1,003
    West total 2,011  1,547,187  769 2,012  1,415,069  703
    Colorado 184  134,831  733 126  71,940  571
    Texas 636  337,232  530 498  232,323  467
    Central total 820  472,063  576 624  304,263  488
    Maryland 83  59,528  717 201  113,828  566
    North Carolina 96  45,380  473 12  4,274  356
    South Carolina 25  9,825  393 3  840  280
    Virginia 123  108,176  879 112  78,390  700
    East total 327  222,909  682 328  197,332  602
    Total 3,158 $2,242,159 $710 2,964 $1,916,664 $647
                 
      December 31,
    2021    		 December 31,
    2020    		        
    Lots Owned or Controlled:            
    Arizona 4,607  4,128        
    California 15,091  15,040        
    Nevada 2,161  2,639        
    Washington 1,010  964        
    West total 22,869  22,771        
    Colorado 1,683  1,080        
    Texas 12,297  6,985        
    Central total 13,980  8,065        
    Maryland 573  892        
    North Carolina 3,044  2,808        
    South Carolina 414  106        
    Virginia 795  999        
    East total 4,826  4,805        
    Total 41,675  35,641        
                 
      December 31,
    2021    		 December 31,
    2020    		        
    Lots by Ownership Type:            
    Lots owned 22,136  22,620        
    Lots controlled (1) 19,539  13,021        
    Total 41,675  35,641        

    _____________________________________
    (1) As of December 31, 2021 and 2020, lots controlled included lots that were under land option contracts or purchase contracts. As of December 31, 2021 and 2020, lots controlled for Central include 2,950 and 2,083 lots, respectively, and lots controlled for East include 179 lots, 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,
       2021  %  2020  %
      (dollars in thousands)
    Home sales revenue $1,200,222  100.0% $1,045,020  100.0%
    Cost of home sales  907,642  75.6%  803,018  76.8%
    Homebuilding gross margin  292,580  24.4%  242,002  23.2%
    Add:  interest in cost of home sales  23,991  2.0%  31,013  3.0%
    Add:  impairments and lot option abandonments  20,125  1.7%  1,960  0.2%
    Adjusted homebuilding gross margin(1) $336,696  28.1% $274,975  26.4%
    Homebuilding gross margin percentage  24.4%    23.2%  
    Adjusted homebuilding gross margin percentage(1)  28.1%    26.3%  


      Year Ended December 31,
       2021  %  2020  %
      (dollars in thousands)
    Home sales revenue $3,955,154  100.0% $3,232,836  100.0%
    Cost of home sales  2,972,237  75.1%  2,520,790  78.0%
    Homebuilding gross margin  982,917  24.9%  712,046  22.0%
    Add:  interest in cost of home sales  101,176  2.6%  93,131  2.9%
    Add:  impairments and lot option abandonments  20,838  0.5%  4,004  0.1%
    Adjusted homebuilding gross margin(1) $1,104,931  27.9% $809,181  25.0%
    Homebuilding gross margin percentage  24.9%    22.0%  
    Adjusted homebuilding gross margin percentage(1)  27.9%    25.0%  


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

    The following table reconciles the Company’s ratio of debt-to-capital to the non-GAAP ratio of net debt-to-net capital. We believe that the ratio of net 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, 2021 December 31, 2020
    Loans payable $250,504  $258,979 
    Senior notes  1,087,219   1,084,022 
    Total debt  1,337,723   1,343,001 
    Stockholders’ equity  2,447,621   2,232,537 
    Total capital $3,785,344  $3,575,538 
    Ratio of debt-to-capital(1)  35.3%  37.6%
         
    Total debt $1,337,723  $1,343,001 
    Less: Cash and cash equivalents  (681,528)  (621,295)
    Net debt  656,195   721,706 
    Stockholders’ equity  2,447,621   2,232,537 
    Net capital $3,103,816  $2,954,243 
    Ratio of net debt-to-net capital(2)  21.1%  24.4%

    _____________________________________
    (1) The ratio of debt-to-capital is computed as the quotient obtained by dividing debt by the sum of debt plus equity.
    (2) The ratio of net debt-to-net capital is computed as the quotient obtained by dividing net debt (which is debt less cash and cash equivalents) by the sum of net debt plus 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, as reported and prepared in accordance with GAAP. EBITDA means net income 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, (f) real estate inventory impairments and lot option abandonments, (g) early loan termination costs and (h) restructuring charges. 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,
       2021   2020   2021   2020 
      (in thousands)
    Net income available to common stockholders $147,440  $115,114  $469,267  $282,207 
    Interest expense:        
    Interest incurred  24,766   20,450   92,783   83,120 
    Interest capitalized  (24,766)  (20,450)  (92,783)  (83,120)
    Amortization of interest in cost of sales  23,991   31,082   101,448   93,248 
    Provision for income taxes  49,117   38,884   156,395   91,170 
    Depreciation and amortization  8,323   10,301   32,421   29,497 
    EBITDA  228,871   195,381   759,531   496,122 
    Amortization of stock-based compensation  8,369   5,997   20,941   16,885 
    Real estate inventory impairments and lot option abandonments  20,125   1,960   20,838   4,004 
    Early loan termination costs  —   —   —   10,243 
    Restructuring charges  —   58   —   5,661 
    Adjusted EBITDA $257,365  $203,396  $801,310  $532,915 

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