PLANO, Texas, March 04, 2019 (GLOBE NEWSWIRE) -- Green Brick Partners, Inc. (Nasdaq: GRBK) (“we,” “Green Brick” or the “Company”) today reported results for its fourth quarter and year ended December 31, 2018.

Results for the Fourth Quarter Ended December 31, 2018:

  • Basic net income attributable to Green Brick per common share (“EPS”) for the three months ended December 31, 2018 was $0.26, an increase of 262.5%, compared to $(0.16) for the three months ended December 31, 2017. Basic adjusted pre-tax income attributable to Green Brick per common share (“Adjusted EPS”) for the three months ended December 31, 2018 was $0.34, unchanged compared to $0.34 for the three months ended December 31, 2017. See “Reconciliation of Non-GAAP Financial Measures.”

  • For the three months ended December 31, 2018, adjusted pre-tax income attributable to Green Brick was $17.1 million, a decrease of 0.3%, compared to $17.2 million for the three months ended December 31, 2017; gross profit was $37.0 million, an increase of 27.6%, compared to $29.0 million for the three months ended December 31, 2017; and total revenue was $185.1 million, an increase of 34.7%, compared to $137.4 million for the three months ended December 31, 2017.

  • Residential units revenue for the three months ended December 31, 2018 was $172.0 million, an increase of 27.9%, compared to $134.5 million for the three months ended December 31, 2017. Land and lots revenue for the three months ended December 31, 2018 was $13.1 million, an increase of 350.4%, compared to $2.9 million for the three months ended December 31, 2017.

  • The dollar value of backlog units as of December 31, 2018 was $264.3 million, an increase of 74.5% compared to $151.5 million as of December 31, 2017.

  • Homes under construction increased 53.1% to 1,127 as of December 31, 2018, compared to 736 as of December 31, 2017.

Results for the Year Ended December 31, 2018:

  • EPS for the year ended December 31, 2018 was $1.02, an increase of 240.0% compared to $0.30 for the year ended December 31, 2017. Excluding one-time transaction expenses, Adjusted EPS for the year ended December 31, 2018 was $1.37, an increase of 25.7%, compared to $1.09 for the year ended December 31, 2017. See “Reconciliation of Non-GAAP Financial Measures.”

  • For the year ended December 31, 2018, adjusted pre-tax income attributable to Green Brick was $69.4 million, an increase of 28.9%, compared to $53.9 million for the year ended December 31, 2017; gross profit was $130.3 million, an increase of 31.6%, compared to $99.0 million for the year ended December 31, 2017; and total revenue was $623.6 million an increase of 36.1%, compared to $458.3 million for the year ended December 31, 2017.

  • Residential units revenue for the year ended December 31, 2018 was $578.9 million, an increase of 31.7%, compared to $439.5 million for the year ended December 31, 2017. Land and lots revenue for the year ended December 31, 2018 was $44.8 million, an increase of 138.9%, compared to $18.7 million for the year ended December 31, 2017.

“2018 was a record year for our Company with revenues of $623.6 million, adjusted pre-tax income of $69.4 million and earnings per share of $1.02. We accomplished these results with a net debt to total capitalization ratio of 26%, one of the lowest of any public builder. While we and our competition face a cooler outlook in 2019, we are well positioned for growth due to our diverse homebuyer customer mix, prime geographic homebuilding markets and disciplined management”, said Jim Brickman, CEO of Green Brick Partners, Inc.

Earnings Conference Call:

We will host our earnings conference call to discuss our fourth quarter and the year ended December 31, 2018 at 12:00 p.m. Eastern Time on Tuesday, March 5, 2019. The call can be accessed by dialing 800-374-0137 for domestic participants or 904-685-8013 for international participants. Participants should reference conference ID code 6624669. A replay of the call will be available from approximately 3:30 p.m. Eastern Time on March 5, 2019 through 11:59 p.m. Eastern Time on March 12, 2019. To access the replay, the domestic dial-in number is 855-859-2056, the international dial-in number is 404-537-3406 and the conference ID code is 6624669.

Reconciliation of Non-GAAP Financial Measures:

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 U.S. 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.

GREEN BRICK PARTNERS, INC.
CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

       
  Three Months Ended December 31, Years Ended December 31,
   2018   2017   2018   2017 
         
  (unaudited) (unaudited)    
Residential units revenue $171,990  $134,509  $578,893  $439,520 
Land and lots revenue 13,130  2,915  44,754  18,730 
Total revenues 185,120  137,424  623,647  458,250 
Cost of residential units 137,221  105,877  457,151  345,360 
Cost of land and lots 10,911  2,550  36,166  13,856 
Total cost of revenues 148,132  108,427  493,317  359,216 
Total gross profit 36,988  28,997  130,330  99,034 
Selling, general and administrative expense 16,071  10,284  56,830  39,016 
Change in fair value of contingent consideration 1,693  —  1,693  — 
Operating profit 19,224  18,713  71,807  60,018 
Equity in income of unconsolidated entities 725  1,778  7,259  2,746 
Other income, net 774  526  2,605  1,473 
Income before income taxes 20,723  21,017  81,671  64,237 
Income tax expense 3,795  25,396  17,136  39,031 
Net income (loss) 16,928  (4,379) 64,535  25,206 
Less: Net income attributable to noncontrolling interests 3,574  3,816  12,912  10,236 
Net income (loss) attributable to Green Brick Partners, Inc. $13,354  $(8,195) $51,623  $14,970 
         
Net income (loss) attributable to Green Brick Partners, Inc. per common share:        
Basic $0.26  $(0.16) $1.02  $0.30 
Diluted $0.26  $(0.16) $1.02  $0.30 
Weighted average common shares used in the calculation of net income attributable to Green Brick Partners, Inc. per common share:        
Basic 50,678  50,555  50,652  49,597 
Diluted 50,723  50,681  50,751  49,683 

GREEN BRICK PARTNERS, INC.
CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

        As of December 31,
        2018 2017
         (unaudited)    
ASSETS
Cash$38,315  $36,684 
Restricted cash3,440  3,605 
Receivables4,842  1,605 
Inventory668,961  496,054 
Investment in unconsolidated entities20,269  16,878 
Property and equipment, net4,690  804 
Earnest money deposits16,793  18,393 
Deferred income tax assets, net16,499  31,211 
Intangible assets, net856  — 
Goodwill680  — 
Other assets8,681  5,769 
Total assets$784,026  $611,003 
LIABILITIES AND EQUITY              
Accounts payable$26,091  $22,354 
Accrued expenses29,201  18,465 
Customer and builder deposits31,978  21,447 
Borrowings on lines of credit, net200,386  105,773 
Notes payable—  9,926 
Contingent consideration2,207  — 
Total liabilities289,863  177,965 
Commitments and contingencies   
Redeemable noncontrolling interest in equity of consolidated subsidiary8,531  — 
Equity   
Green Brick Partners, Inc. stockholders’ equity   
Preferred stock, $0.01 par value: 5,000,000 shares authorized; none issued and outstanding—  — 
Common shares, $0.01 par value: 100,000,000 shares authorized; 50,719,884 and 50,598,901 issued as of December 31, 2018 and 2017, respectively; 50,583,128 and 50,598,901 outstanding as of December 31, 2018 and 2017, respectively507  506 
Treasury stock at cost, 136,756 shares(981) — 
Additional paid-in capital291,299  289,938 
Retained earnings177,526  125,903 
    Total Green Brick Partners, Inc. stockholders’ equity468,351  416,347 
Noncontrolling interests17,281  16,691 
Total equity485,632  433,038 
Total liabilities and equity$784,026  $611,003 
        

GREEN BRICK PARTNERS, INC.
SUPPLEMENTAL INFORMATION
(Unaudited)

  Three Months Ended
December 31,		   Years Ended December 31,  
Residential Units Sales Revenue and New Homes Delivered 2018 2017 Change % 2018 2017 Change %
Home closings revenue (dollars in thousands) $169,534  $133,465  $36,069  27.0% $571,177  $435,644  $135,533  31.1%
Mechanic’s lien contracts revenue (dollars in thousands) 2,456  1,044  1,412  135.2% 7,716  3,876  3,840  99.1%
Residential units revenue (dollars in thousands) $171,990  $134,509  $37,481  27.9% $578,893  $439,520  $139,373  31.7%
New homes delivered 382  292  90  30.8% 1,287  990  297  30.0%
Average sales price of homes delivered $443,806  $457,072  $(13,266) (2.9)% $443,805  $440,044  $3,761  0.9%


  Three Months Ended
December 31,		   Years Ended December 31,  
Land and Lots Sales Revenue 2018 2017 Change % 2018 2017 Change %
Lots revenue (dollars in thousands) $10,780  $2,915  $7,865  269.8% $35,074  $17,859  $17,215  96.4%
Land revenue (dollars in thousands) 2,350  —  2,350  —% 9,680  871  8,809  1,011.4%
Land and lots revenue (dollars in thousands) $13,130  $2,915  $10,215  350.4% $44,754  $18,730  $26,024  138.9%
Lots closed 76  25  51  204.0% 239  143  96  67.1%
Average sales price of lots closed $141,842  $116,600  $25,242  21.6% $146,753  $124,888  $21,865  17.5%


  Three Months Ended December 31,   Years Ended December 31,  
New Home Orders and Backlog 2018 2017 Change % 2018 2017 Change %
Net new home orders 279  265  14  5.3% 1,397  1,063  334  31.4%
Number of cancellations 79  51  28  54.9% 245  188  57  30.3%
Cancellation rate 22.1% 16.1% 6.0% 37.3% 14.9% 15.0% (0.1)% (0.7)%
Absorption rate per selling community 3.7  4.7  (1.0) (21.3)% 21.2  19.7  1.5  7.6%
Average selling communities 76  56  20  35.7% 66  54  12  22.2%
Selling communities at end of period 76  55  21  38.2%        
Backlog (dollars in thousands) $264,275  $151,463  $112,812  74.5%        
Backlog (units) 582  310  272  87.7%        
Average sales price of backlog $454,081  $488,590  $(34,509) (7.1)%        


  Year Ended
December 31, 2018		 December 31, 2018 December 31, 2017
Builder Average Selling
Communities		 Selling
Communities		 Backlog,
Units		 Backlog, in
thousands		 Selling
Communities		 Backlog,
Units		 Backlog, in
thousands
The Providence Group of Georgia LLC 28 27 146 $77,563 30 140 $70,309
CB JENI Homes DFW LLC 19 21 170 67,988 16 117 44,067
Centre Living Homes LLC 5 6 14 7,493 4 5 2,239
Southgate Homes DFW LLC 7 8 55 37,873 5 48 34,848
GRBK GHO Homes LLC 7 14 197 73,358 — — —
Total 66 76  582 $264,275 55 310 $151,463
                 


  December 31, 2018 December 31, 2017
Lots owned    
Central 4,447  3,196 
Southeast 1,788  1,299 
Total lots owned 6,235  4,495 
Lots controlled    
Central 853  1,390 
Southeast 990  334 
Total lots controlled 1,843  1,724 
Total lots owned and controlled (1) 8,078  6,219 
Percentage of lots owned 77.2% 72.3%

(1) Total lots excludes lots with homes under construction.

Reconciliation of Non-GAAP Financial Measures

The following table presents the non-GAAP measure of Adjusted EPS for the three months and years ended December 31, 2018 and 2017 and reconciles these amounts to net income attributable to Green Brick as reported and prepared in accordance with GAAP. Adjusted EPS for the three months and years ended December 31, 2018 and 2017 represents adjusted pre-tax income for the period presented, divided by the weighted average number of common shares outstanding for the three months and years ended December 31, 2018 and 2017, respectively. Adjusted pre-tax income represents net income attributable to Green Brick for the period, excluding income tax expense attributable to Green Brick and one-time transaction expenses related to a public secondary offering of the Company’s shares.

  Three Months Ended
December 31,		 
Years Ended December 31,
(Unaudited, in thousands, except per share amounts):  2018  2017   2018  2017
Net income (loss) attributable to Green Brick $  13,354 $(8,195) $  51,623 $  14,970
Income tax expense attributable to Green Brick  3,754  25,356   16,984  38,896
Transaction expenses  —  —   827  —
Adjusted pre-tax income attributable to Green Brick $  17,108 $  17,161  $  69,434 $  53,866
          
Weighted-average number of shares outstanding - basic  50,678  50,555   50,652  49,597
Basic adjusted EPS $0.34 $0.34  $1.37 $1.09
          
Weighted-average number of shares outstanding - diluted  50,723  50,681   50,751  49,683
Diluted adjusted EPS $0.34 $0.34  $1.37 $1.08
          

The following table represents the non-GAAP measure of adjusted homebuilding gross margin for the three months and years ended December 31, 2018 and 2017 and reconciles these amounts to homebuilding gross margin, the most directly comparable GAAP measure.

  Three Months Ended
December 31,		 
Years Ended December 31,
(Unaudited, in thousands): 2018 2017 2018 2017
Residential units revenue $171,990  $134,509  $578,893  $439,520 
Less: Mechanic’s lien contracts revenue (2,456) (1,044) (7,716) (3,876)
Home closings revenue $169,534  $133,465  $571,177  $435,644 
Homebuilding gross margin $34,104  $28,466  $120,141  $93,579 
Add back: Capitalized interest charged to cost of sales 1,396  754  3,961  2,630 
Adjusted homebuilding gross margin $35,500  $29,220  $124,102  $96,209 
Adjusted homebuilding gross margin percentage 20.9% 21.9% 21.7% 22.1%

About Green Brick Partners, Inc.:

Green Brick Partners, Inc. (Nasdaq: GRBK) is a diversified homebuilding and land development company. Green Brick owns a controlling interest in five homebuilders in Dallas, Texas (CB JENI Homes, Normandy Homes, Southgate Homes, Centre Living Homes, and Trophy Signature Homes), as well as a homebuilder in Atlanta, Georgia (The Providence Group) and a homebuilder in Port St. Lucie, Florida (GHO Homes). Green Brick also owns a noncontrolling interest in Challenger Homes in Colorado Springs, Colorado and retains interests in related financial services platforms, including Green Brick Title, Providence Group Title, and Green Brick Mortgage. The Company is engaged in all aspects of the homebuilding process, including land acquisition and development, entitlements, design, construction, marketing, and sales for its residential neighborhoods and master planned communities. For more information about Green Brick’s homebuilding partners, please visit https://greenbrickpartners.com/team-builders/.

Forward-Looking and Cautionary Statements:

Any statements in this press release about Green Brick’s expectations, beliefs, plans, objectives, prospects, financial condition, assumptions or future events or performance that are not historical facts are forward-looking statements.  These statements are often, but not always, made through the use of words or phrases such as “may,” “will,” “should,” “predicts,” “potential,” “expects,” “future,” “positioned,” “believes,” “projects,” “estimates” and similar expressions, as well as statements in the future tense. These statements are based on assumptions that Green Brick has made in light of its experience in the industry as well as its perceptions of historical trends, current conditions, expected future developments and other factors it believes are appropriate under the circumstances, as of the date of this press release. All such forward-looking statements involve estimates and assumptions that are subject to factors that could cause actual results to differ materially from the results expressed in the statements, and you should not place undue reliance on any such forward-looking statements. Among the factors that could cause actual results to differ materially are the following: general economic conditions, seasonality, cyclicality and competition in the homebuilding industry; the failure to recruit, retain and develop highly skilled and competent employees; management and integration of acquisitions; labor and raw material shortages; an inability to acquire land for reasonable prices; an inability to develop and sell communities; government regulation risks; mortgage financing availability and volatility; severe weather or natural disasters; difficulty in obtaining sufficient capital; poor relations with community residents; and our debt and related service obligations. Additional factors that could cause actual results to differ are discussed in the “Risk Factors” and “Management's Discussion and Analysis of Financial Condition and Results of Operations” in the Company's annual and quarterly reports filed with the Securities and Exchange Commission. Green Brick undertakes no obligation to update any forward-looking statement except as required by law.

Contact: Richard A. Costello
Chief Financial Officer
(469) 573-6755

A PDF is available at http://resource.globenewswire.com/Resource/Download/1ebbe032-8b7a-4cd7-bf98-2d8581272eca

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