First Quarter 2024 Highlights
- First quarter net new home orders of 612, a 23% year-over-year increase
- Total revenue of
$294.0 million , driven by 505 home closings at an average price of$579,000 - Adjusted EBITDA of
$17.0 million - Book value per share of
$17.92 - Repurchased approximately 534,000 shares of common stock for
$6.4 million
Management Commentary
“Landsea Homes delivered strong top-line growth in the first quarter of 2024, as home sales revenue increased 22% on a year-over-year basis”, said
Operating Results
Total revenue was
New homes delivered increased 7% to 505 homes at an average sales price of
Net new home orders were up 23% to 612 homes with a dollar value of
Total homes in backlog were 624 homes with a dollar value of
Total lots owned or controlled at
Home sales gross margin was 14.9% compared to 18.1% in the prior year period. Adjusted home sales gross margin (a non-GAAP measure) was 19.4% compared to 21.9% in the prior year period. The decrease was primarily attributed to the increase in sales discounts and incentives.
Net income attributable to
Adjusted EBITDA (a non-GAAP measure) was
Balance Sheet
As of
Landsea Homes’ ratio of debt to capital was 46.4% at
Second Quarter 2024 Outlook
- New home deliveries anticipated to be in the range of 600 to 650
- Delivery ASPs expected to be in the range of
$525,000 to$530,000 - Home sales gross margin to be between 15% and 16%
Full Year 2024 Outlook
- New home deliveries anticipated to be in the range of 2,500 to 2,900
- Delivery ASPs expected to be in the range of
$500,000 to$525,000 - Home sales gross margin to be between 17% and 18%
Conference Call
The Company will hold a conference call today at
- Toll-free dial-in number: 1-877-704-4453
- International dial-in number: 1-201-389-0920
The conference call will be broadcast live and available for replay here and via the Investors section of the
A replay of the conference call will be available after
Replay Details:
- Toll-free replay number: 1-844-512-2921
- International replay number: 1-412-317-6671
- Replay ID: 13745940
About
An award-winning homebuilder that builds suburban, single-family detached and attached homes, mid-and high-rise properties, and master-planned communities,
Driven by a pioneering commitment to sustainability, Landsea Homes’
Led by a veteran team of industry professionals who boast years of worldwide experience and deep local expertise,
For more information on
Forward-Looking Statements
Certain statements in this press release may constitute “forward-looking statements” within the meaning of the federal securities laws, including, but not limited to, our expectations for future financial performance, business strategies or expectations for our business. These statements constitute projections, forecasts, and forward-looking statements, and are not guarantees of performance.
These forward-looking statements are based on information available as of the date of this press release and our management’s current expectations, forecasts, and assumptions, and involve a number of judgments, risks and uncertainties that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements.
These risks and uncertainties include, but are not limited to, the risk factors described by
- the cyclical nature of our industry and the possibility that adverse changes in general and local economic conditions could reduce the demand for homes;
- our ability to develop communities successfully and in a timely manner;
- changes in the terms and availability of mortgage financing, interest rates, federal lending programs, and tax laws, affecting the demand for and the ability of our homebuyers to complete the purchase of a home;
- our geographic concentration, which could materially and adversely affect us if the homebuilding industry in our current markets should experience a decline;
- the potential for adverse weather and geological conditions to increase costs, cause project delays or reduce consumer demand for housing;
- our ability to promptly sell one or more properties for reasonable prices in response to changing economic, financial and investment conditions, and the risk that we may be forced to hold non-income producing properties for extended periods of time;
- our reliance on third-party skilled labor, suppliers and long supply chains;
- the dependence of our long-term sustainability and growth upon our ability to acquire lots that are either developed or have the approvals necessary for us to develop them; and
- the other risks and uncertainties indicated in Landsea Homes’
SEC reports or documents filed or to be filed with theSEC byLandsea Homes .
Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and you should not place undue reliance on these forward-looking statements in deciding whether to invest in our securities. We do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Stock Repurchase
Purchases of common stock pursuant to this authority 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 to repurchase any specific number or amount of shares of common stock, and it may modify, suspend or discontinue the program at any time. The Company 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.
Investor Relations Contact:
Mackintosh Investor Relations, LLC
drew@mackintoshir.com
(310) 924-9036
Media Contact:
anoebel@cornerstonecomms.com
(949) 449-2527
(dollars in thousands) | |||||
Assets | |||||
Cash and cash equivalents | $ | 121,492 | $ | 119,555 | |
Cash held in escrow | 18,460 | 49,091 | |||
Real estate inventories | 1,196,506 | 1,121,726 | |||
Due from affiliates | 4,462 | 4,348 | |||
68,639 | 68,639 | ||||
Other assets | 133,818 | 107,873 | |||
Total assets | $ | 1,543,377 | $ | 1,471,232 | |
Liabilities | |||||
Accounts payable | $ | 88,707 | $ | 77,969 | |
Accrued expenses and other liabilities | 192,115 | 160,256 | |||
Due to affiliates | 881 | 881 | |||
Line of credit facility, net | 348,237 | 307,631 | |||
Senior notes, net | 236,913 | 236,143 | |||
Total liabilities | 866,853 | 782,880 | |||
Commitments and contingencies | |||||
Equity | |||||
Stockholders’ equity: | |||||
Preferred stock, | — | — | |||
Common stock, | 4 | 4 | |||
Additional paid-in capital | 459,521 | 465,290 | |||
Retained earnings | 187,774 | 187,584 | |||
Total stockholders’ equity | 647,299 | 652,878 | |||
Noncontrolling interests | 29,225 | 35,474 | |||
Total equity | 676,524 | 688,352 | |||
Total liabilities and equity | $ | 1,543,377 | $ | 1,471,232 | |
Three Months Ended | ||||||
2024 | 2023 | |||||
(dollars in thousands, except per share amounts) | ||||||
Revenue | ||||||
Home sales | $ | 292,592 | $ | 240,625 | ||
Lot sales and other | 1,449 | 1,115 | ||||
Total revenues | 294,041 | 241,740 | ||||
Cost of sales | ||||||
Home sales | 248,897 | 197,054 | ||||
Lot sales and other | 1,683 | 713 | ||||
Total cost of sales | 250,580 | 197,767 | ||||
Gross margin | ||||||
Home sales | 43,695 | 43,571 | ||||
Lot sales and other | (234 | ) | 402 | |||
Total gross margin | 43,461 | 43,973 | ||||
Sales and marketing expenses | 18,488 | 16,408 | ||||
General and administrative expenses | 26,082 | 22,780 | ||||
Total operating expenses | 44,570 | 39,188 | ||||
(Loss) income from operations | (1,109 | ) | 4,785 | |||
Other income, net | 1,813 | 955 | ||||
Pretax income | 704 | 5,740 | ||||
(Benefit) provision for income taxes | (30 | ) | 1,617 | |||
Net income | 734 | 4,123 | ||||
Net income attributable to noncontrolling interests | 544 | 905 | ||||
Net income attributable to | $ | 190 | $ | 3,218 | ||
Income per share: | ||||||
Basic | $ | 0.01 | $ | 0.08 | ||
Diluted | $ | 0.01 | $ | 0.08 | ||
Weighted average common shares outstanding: | ||||||
Basic | 36,279,679 | 39,997,699 | ||||
Diluted | 36,798,722 | 40,116,873 | ||||
Home Deliveries and Home Sales Revenue
Three Months Ended | ||||||||||||||||||||||||
2024 | 2023 | % Change | ||||||||||||||||||||||
Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||
183 | $ | 78,741 | $ | 430 | 170 | $ | 72,534 | $ | 427 | 8 | % | 9 | % | 1 | % | |||||||||
146 | 131,894 | 903 | 85 | 67,258 | 791 | 72 | % | 96 | % | 14 | % | |||||||||||||
17 | 8,854 | 521 | — | — | N/A | N/A | N/A | N/A | ||||||||||||||||
157 | 72,355 | 461 | 212 | 94,990 | 448 | (26) | % | (24) | % | 3 | % | |||||||||||||
Metro | — | — | N/A | 1 | 1,649 | 1,649 | N/A | N/A | N/A | |||||||||||||||
2 | 748 | 374 | 4 | 4,194 | 1,049 | (50) | % | (82) | % | (64) | % | |||||||||||||
Total | 505 | $ | 292,592 | $ | 579 | 472 | $ | 240,625 | $ | 510 | 7 | % | 22 | % | 14 | % | ||||||||
Three Months Ended | ||||||||||||||||||||||
2024 | 2023 | % Change | ||||||||||||||||||||
Homes | Dollar Value | ASP | Monthly Absorption Rate | Homes | Dollar Value | ASP | Monthly Absorption Rate | Homes | Dollar Value | ASP | Monthly Absorption Rate | |||||||||||
(dollars in thousands) | ||||||||||||||||||||||
233 | $ | 103,515 | $ | 444 | 3.6 | 152 | $ | 62,745 | $ | 413 | 3.2 | 53 | % | 65 | % | 8 | % | 13 | % | |||
107 | 108,325 | 1,012 | 3.7 | 164 | 136,227 | 831 | 4.7 | (35) | % | (20) | % | 22 | % | (21) | % | |||||||
23 | 10,871 | 473 | 3.8 | — | — | N/A | N/A | N/A | N/A | N/A | N/A | |||||||||||
236 | 109,533 | 464 | 2.7 | 178 | 79,338 | 446 | 2.0 | 33 | % | 38 | % | 4 | % | 35 | % | |||||||
Metro | 1 | 4,312 | N/A | N/A | — | — | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||
12 | 4,695 | 391 | 13.3 | 4 | 4,194 | 1,049 | 1.3 | 200 | % | 12 | % | (63) | % | 923 | % | |||||||
Total | 612 | $ | 341,251 | $ | 558 | 3.3 | 498 | $ | 282,504 | $ | 567 | 2.8 | 23 | % | 21 | % | (2) | % | 18 | % | ||
Average Selling Communities
Three Months Ended | |||
2024 | 2023 | % Change | |
21.3 | 16.0 | 33% | |
9.7 | 11.7 | (17) % | |
2.0 | — | N/A | |
29.3 | 30.0 | (2) % | |
Metro | — | — | —% |
0.3 | 1.0 | (70) % | |
Total | 62.6 | 58.7 | 7% |
Backlog
% Change | ||||||||||||||||||||||||
Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | Homes | Dollar Value | ASP | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||
146 | $ | 66,207 | $ | 453 | 87 | $ | 40,197 | $ | 462 | 68% | 65% | (2)% | ||||||||||||
122 | 134,601 | 1,103 | 158 | 147,415 | 933 | (23)% | (9)% | 18% | ||||||||||||||||
20 | 9,557 | 478 | — | — | N/A | N/A | N/A | N/A | ||||||||||||||||
325 | 165,662 | 510 | 451 | 235,245 | 522 | (28)% | (30)% | (2)% | ||||||||||||||||
Metro | 1 | 4,312 | 4,312 | — | — | N/A | N/A | N/A | N/A | |||||||||||||||
10 | 3,947 | 395 | — | — | N/A | N/A | N/A | N/A | ||||||||||||||||
Total | 624 | $ | 384,286 | $ | 616 | 696 | $ | 422,857 | $ | 608 | (10)% | (9)% | 1% | |||||||||||
Lots Owned or Controlled
Lots Owned | Lots Controlled | Total | Lots Owned | Lots Controlled | Total | % Change | ||||||||
1,505 | 1,462 | 2,967 | 2,118 | 1,491 | 3,609 | (18)% | ||||||||
569 | 1,200 | 1,769 | 504 | 1,679 | 2,183 | (19)% | ||||||||
168 | 125 | 293 | — | — | — | N/A | ||||||||
1,800 | 1,770 | 3,570 | 2,376 | 2,098 | 4,474 | (20)% | ||||||||
Metro | 2 | — | 2 | 2 | — | 2 | —% | |||||||
202 | 1,548 | 1,750 | — | 1,167 | 1,167 | 50% | ||||||||
Total | 4,246 | 6,105 | 10,351 | 5,000 | 6,435 | 11,435 | (9)% | |||||||
Home Sales Gross Margins
Home sales gross margin measures the price achieved on delivered homes compared to the costs needed to build the home. In the following table, we calculate gross margins adjusting for interest in cost of sales, inventory impairments, and purchase price accounting for acquired work in process inventory. This non-GAAP financial measure should not be used as a substitute for the Company's operating results in accordance with GAAP. An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP. We believe the below information is meaningful as it isolates the impact that indebtedness, impairments, and acquisitions have on our gross margins and allows for comparability to previous periods and competitors.
Three Months Ended | |||||||||||
2024 | % | 2023 | % | ||||||||
(dollars in thousands) | |||||||||||
Home sales revenue | $ | 292,592 | 100.0 | % | $ | 240,625 | 100.0 | % | |||
Cost of home sales | 248,897 | 85.1 | % | 197,054 | 81.9 | % | |||||
Home sales gross margin | 43,695 | 14.9 | % | 43,571 | 18.1 | % | |||||
Add: Interest in cost of home sales | 10,557 | 3.6 | % | 4,542 | 1.9 | % | |||||
Adjusted home sales gross margin excluding interest and real estate inventories impairment | 54,252 | 18.5 | % | 48,113 | 20.0 | % | |||||
Add: Purchase price accounting for acquired inventory | 2,456 | 0.8 | % | 4,485 | 1.9 | % | |||||
Adjusted home sales gross margin excluding interest, real estate inventories impairment, and purchase price accounting for acquired inventory | $ | 56,708 | 19.4 | % | $ | 52,598 | 21.9 | % | |||
EBITDA and Adjusted EBITDA
The following table presents EBITDA and Adjusted EBITDA for the three months ended
Three Months Ended | ||||||
2024 | 2023 | |||||
(dollars in thousands) | ||||||
Net income | $ | 734 | $ | 4,123 | ||
(Benefit) provision for income taxes | (30 | ) | 1,617 | |||
Interest in cost of sales | 10,570 | 4,553 | ||||
Depreciation and amortization expense | 1,320 | 1,418 | ||||
EBITDA | 12,594 | 11,711 | ||||
Purchase price accounting in cost of home sales | 2,456 | 4,485 | ||||
Transaction costs | 1,728 | 15 | ||||
Abandoned project costs | 256 | — | ||||
Adjusted EBITDA | $ | 17,034 | $ | 16,211 | ||
Adjusted Net Income
Adjusted Net Income attributable to
Three Months Ended | |||||
2024 | 2023 | ||||
(dollars in thousands, except share and per share amounts) | |||||
Net income attributable to | $ | 190 | $ | 3,218 | |
Pre-Merger capitalized related party interest included in cost of sales | 29 | 718 | |||
Purchase price accounting for acquired inventory | 2,456 | 4,485 | |||
Total adjustments | 2,485 | 5,203 | |||
Tax-effected adjustments (1) | 1,843 | 3,839 | |||
Adjusted net income attributable to | $ | 2,033 | $ | 7,057 | |
Earnings per share | |||||
Basic | $ | 0.01 | $ | 0.08 | |
Diluted | $ | 0.01 | $ | 0.08 | |
Adjusted earnings per share | |||||
Basic | $ | 0.06 | $ | 0.18 | |
Diluted | $ | 0.06 | $ | 0.18 | |
Weighted shares outstanding | |||||
Weighted average common shares outstanding used in EPS - basic | 36,279,679 | 39,997,699 | |||
Weighted average common shares outstanding used in EPS - diluted | 36,798,722 | 40,116,873 | |||
(1) Our tax-effected adjustments are based on our federal rate and a blended state rate adjusted for certain discrete items. | |||||
Net Debt to Total Capital
The following table presents the ratio of debt to capital as well as the ratio of net debt to total capital which is a non-GAAP financial measure. The ratio of debt to capital is computed as the quotient obtained by dividing total debt, net of issuance costs, by total capital (sum of total debt, net of issuance costs, plus total equity).
The non-GAAP ratio of net debt to total capital is computed as the quotient obtained by dividing net debt (which is total debt, net of issuance costs, less cash and cash equivalents as well as cash held in escrow to the extent necessary to reduce the debt balance to zero) by total capital. The most comparable GAAP financial measure is the ratio of debt to capital. We believe the ratio of net debt to total capital is a relevant financial measure for investors to understand the leverage employed in our operations and as an indicator of our ability to obtain financing. We believe that by deducting our cash from our debt, we provide a measure of our indebtedness that takes into account our cash liquidity. We believe this provides useful information as the ratio of debt to capital does not take into account our liquidity and we believe that the ratio of net debt to total capital provides supplemental information by which our financial position may be considered.
See table below reconciling this non-GAAP measure to the ratio of debt to capital.
(dollars in thousands) | |||||||
Total notes and other debts payable, net | $ | 585,150 | $ | 543,774 | |||
Total equity | 676,524 | 688,352 | |||||
Total capital | $ | 1,261,674 | $ | 1,232,126 | |||
Ratio of debt to capital | 46.4 | % | 44.1 | % | |||
Total notes and other debts payable, net | $ | 585,150 | $ | 543,774 | |||
Less: cash and cash equivalents | 121,492 | 119,555 | |||||
Less: cash held in escrow | 18,460 | 49,091 | |||||
Net debt | 445,198 | 375,128 | |||||
Total capital | $ | 1,261,674 | $ | 1,232,126 | |||
Ratio of net debt to total capital | 35.3 | % | 30.4 | % | |||
Source:
2024 GlobeNewswire, Inc., source