PulteGroup Reports Third Quarter 2012 Financial Results

           PulteGroup Reports Third Quarter 2012 Financial Results

- Q3 Net Income of $117 Million, or $0.30 Per Share

- Adjusted Gross Margin of 21.6% Increased 320 Basis Points from Prior Year
and 130 Basis Points from Q2 2012

- SG&A Dropped 80 Basis Points to 10.2% of Home Sale Revenues

- Net New Orders Increased 27% to 4,544 Homes Realized from 7% Fewer
Communities

- On a Dollar Basis, Net New Orders Increased 43% to $1.3 Billion

- Unit Backlog Grew 49% to 7,686 Homes Valued at $2.2 Billion; Dollar Backlog
At Highest Level Since 2008

- Quarter-End Cash of $1.6 Billion After Retiring $96 Million of Notes During
the Quarter, Up $243 Million from Q2 2012

- Company Launches Tender Offer for Up to $1.0 Billion of Outstanding Senior
Notes

PR Newswire

BLOOMFIELD HILLS, Mich., Oct. 25, 2012

BLOOMFIELD HILLS, Mich., Oct. 25, 2012 /PRNewswire/ -- PulteGroup, Inc. (NYSE:
PHM) announced today financial results for its third quarter ended September
30, 2012. For the quarter, the Company reported net income of $117 million,
or $0.30 per share, inclusive of an $11 million, or $0.03 per share, tax
benefit. In the prior year, the Company reported a net loss of $129 million,
or $0.34 per share, inclusive of a goodwill impairment charge of $241 million,
or $0.63 per share, partially offset by a $73 million, or $0.19 per share, tax
benefit.

"We are extremely pleased with the progress PulteGroup continues to make as
our third quarter results represent our highest quarterly earnings since the
third quarter of 2006 and keep us on track for full-year profitability," said
Richard J. Dugas, Jr., Chairman, President and Chief Executive Officer of
PulteGroup. "Our financial performance reflects improvements within our
homebuilding operations which resulted in adjusted gross margins of 21.6%, an
increase of 320 basis points over last year, and improved SG&A leverage as
overhead expenses fell 80 basis points to 10.2% of home sale revenues.

"The quarter also showed a continuation of the stronger housing demand we have
been experiencing since the start of 2012, as PulteGroup's 27% increase in
year-over-year signups was generated from 7% fewer communities. Although
still well below historical levels, the U.S. housing market has realized a
meaningful increase in the volume of new home sales for the first nine months
of 2012.

"In past cycles, the U.S. housing industry proved to be a powerful engine that
could help drive the economy forward and accelerate the pace of a recovery. A
similar scenario could again be unfolding, as the industry is responding to
increased sales by hiring additional workers and purchasing more building
materials. While we are mindful of any potential impact from global or
domestic economic issues, we are optimistic that the combination of ever
higher rental rates, record low interest rates and limited housing supply can
continue to support the improved housing demand. Within this environment, we
continue to invest in the business appropriately, including having recently
increased our approved 2012 land spend by $90 million to approximately $1.0
billion, while remaining focused on driving improved returns."

Third Quarter Results

Revenue from home sales in the third quarter increased 12% from the prior year
to $1.2 billion. Higher revenue for the period was driven by a 6% increase in
average selling price to $279,000, combined with a 5% increase in closings to
4,418 homes.

For the quarter, the Company's homebuilding operations generated pretax income
of $79 million, compared with a prior year pretax loss of $211 million, which
included a goodwill impairment charge of $241 million. The Company's adjusted
home sale gross margin for the third quarter was 21.6%, an increase of 320
basis points over the prior year and 130 basis points over the second quarter
of 2012. Homebuilding SG&A expense for the quarter was $125 million, or 10.2%
of home sale revenues. SG&A for the prior year period was $122 million, or
11.0% of home sale revenues.

Net new orders for the third quarter totaled 4,544 homes valued at $1.3
billion, an increase of 27% and 43%, respectively, over the prior year. The
year-over-year increase in signups was generated from 7% fewer communities.
On a unit basis, PulteGroup's quarter-end backlog was up 49% to 7,686 homes
with a value of $2.2 billion, compared with a prior year backlog of 5,143
homes with a value of $1.4 billion. The Company's third quarter 2012 backlog
is the highest dollar value since the second quarter of 2008.

The Company's financial services operations reported third quarter pretax
income of $27 million, compared with prior year pretax income of $9 million.
For the quarter, the Company's financial services operations benefitted from
increased loan originations and favorable market conditions which drove higher
gains on mortgage sales. Mortgage capture rate for the quarter was 83%
compared with 78% for the same quarter last year.

Company Announces Tender for Up to $1.0 Billion of its Bonds

As detailed in a separate press release issued October 24, 2012, PulteGroup
announced a tender offer for up to $1.0 billion face amount of certain of the
Company's outstanding senior notes. The Company intends to fund the tender
with cash on hand.

"Our liquidity reflects the Company's improving operating performance, more
stringent capital investment policies, and ongoing sales of non-core assets.
This tender will allow us to reduce PulteGroup's total leverage on terms that
will generate positive yields and further improve our return on invested
capital," said Bob O'Shaughnessy, Executive Vice President and Chief Financial
Officer.

The terms and conditions of the tender offer are described in the Offer to
Purchase, dated October 24, 2012 (the "Offer to Purchase"), and the related
Letter of Transmittal (the "Letter of Transmittal"). Holders of Notes are
urged to read the Offer to Purchase and the related Letter of Transmittal
carefully before making any decision with respect to the tender offer.

A conference call discussing PulteGroup's third quarter 2012 results is
scheduled for Thursday, October 25, 2012, at 8:30 a.m. Eastern Time.
Interested investors can access the live webcast via PulteGroup's corporate
website at pultegroupinc.com.

Forward-Looking Statements

This press release includes "forward-looking statements." These statements
are subject to a number of risks, uncertainties and other factors that could
cause our actual results, performance, prospects or opportunities, as well as
those of the markets we serve or intend to serve, to differ materially from
those expressed in, or implied by, these statements. You can identify these
statements by the fact that they do not relate to matters of a strictly
factual or historical nature and generally discuss or relate to forecasts,
estimates or other expectations regarding future events. Generally, the words
"believe," "expect," "intend," "estimate," "anticipate," "project," "may,"
"can," "could," "might," "will" and similar expressions identify
forward-looking statements, including statements related to expected operating
and performing results, planned transactions, planned objectives of
management, future developments or conditions in the industries in which we
participate and other trends, developments and uncertainties that may affect
our business in the future.

Such risks, uncertainties and other factors include, among other things:
interest rate changes and the availability of mortgage financing; continued
volatility in the debt and equity markets; competition within the industries
in which PulteGroup operates; the availability and cost of land and other raw
materials used by PulteGroup in its homebuilding operations; the impact of any
changes to our strategy in responding to continuing adverse conditions in the
industry, including any changes regarding our land positions; the availability
and cost of insurance covering risks associated with PulteGroup's businesses;
shortages and the cost of labor; weather related slowdowns; slow growth
initiatives and/or local building moratoria; governmental regulation directed
at or affecting the housing market, the homebuilding industry or construction
activities; uncertainty in the mortgage lending industry, including revisions
to underwriting standards and repurchase requirements associated with the sale
of mortgage loans; the interpretation of or changes to tax, labor and
environmental laws; economic changes nationally or in PulteGroup's local
markets, including inflation, deflation, changes in consumer confidence and
preferences and the state of the market for homes in general; legal or
regulatory proceedings or claims; required accounting changes; terrorist acts
and other acts of war; and other factors of national, regional and global
scale, including those of a political, economic, business and competitive
nature. See PulteGroup's Annual Report on Form 10-K for the fiscal year ended
December 31, 2011, and other public filings with the Securities and Exchange
Commission (the "SEC") for a further discussion of these and other risks and
uncertainties applicable to our businesses. PulteGroup undertakes no duty to
update any forward-looking statement, whether as a result of new information,
future events or changes in PulteGroup's expectations.

About PulteGroup

PulteGroup, Inc. (NYSE: PHM), based in Bloomfield Hills, Mich., is one of
America's largest homebuilding companies with operations in approximately60
markets throughout the country. Through its brand portfolio that includes
Centex, Pulte Homes and Del Webb, the company is one of the industry's most
versatile homebuilders able to meet the needs of multiple buyer groups and
respond to changing consumer demand. PulteGroup conducts extensive research to
provide homebuyers with innovative solutions and new homes designed for the
way people actually live today. As the most awarded homebuilder in customer
satisfaction, PulteGroup brands have consistently ranked among top
homebuilders in third-party customer satisfaction studies.

For more information about PulteGroup, Inc. and PulteGroup brands, go to
pultegroupinc.com; www.pulte.com; www.centex.com; www.delwebb.com.

PulteGroup, Inc.

Consolidated Results of Operations

($000's omitted, except per share data)

(Unaudited)
                        Three Months Ended          Nine Months Ended
                        September 30,               September 30,
                        2012          2011          2012          2011
Revenues:
Homebuilding
Home sale revenues      $ 1,232,704   $ 1,101,368   $ 3,070,895   $ 2,783,602
Land sale revenues      22,623        12,659        69,770        19,023
                        1,255,327     1,114,027     3,140,665     2,802,625
Financial Services      47,264        27,904        112,367       71,720
Total revenues          1,302,591     1,141,931     3,253,032     2,874,345
Homebuilding Cost of
Revenues:
Home sale cost of       1,023,704     947,817       2,605,249     2,422,525
revenues
Land sale cost of       21,061        (2,935)       62,069        1,782
revenues
                        1,044,765     944,882       2,667,318     2,424,307
Financial Services      20,578        19,306        62,914        78,832
expenses
Selling, general, and   125,191       121,553       372,691       402,379
administrative expenses
Other expense (income), 7,453         259,187       24,570        274,765
net
Interest income         (1,219)       (1,122)       (3,582)       (3,704)
Interest expense        201           322           616           990
Equity in (earnings)
loss of unconsolidated  (284)         303           (3,836)       (1,999)
entities
Income (loss) before    105,906       (202,500)     132,341       (301,225)
income taxes
Income tax expense      (10,727)      (73,202)      (15,062)      (77,016)
(benefit)
Net income (loss)       $ 116,633     $ (129,298)   $ 147,403     $ (224,209)
Net income (loss) per
share:
Basic                   $ 0.31        $ (0.34)      $ 0.39        $ (0.59)
Diluted                 $ 0.30        $ (0.34)      $ 0.38        $ (0.59)
Number of shares used
in calculation:
Basic                   381,355       380,025       380,839       379,785
Effect of dilutive      3,215         —             2,036         —
securities
Diluted                 384,570       380,025       382,875       379,785



PulteGroup, Inc.

Condensed Consolidated Balance Sheets

($000's omitted)

(Unaudited)
                                              September30,  December31,
                                              2012           2011
ASSETS
Cash and equivalents                          $  1,563,651   $ 1,083,071
Restricted cash                               76,730         101,860
House and land inventory                      4,470,571      4,636,468
Land held for sale                            129,523        135,307
Land, not owned, under option agreements      11,054         24,905
Residential mortgage loans available-for-sale 263,378        258,075
Investments in unconsolidated entities        30,794         35,988
Income taxes receivable                       28,282         27,154
Other assets                                  414,074        420,444
Intangible assets, net                        152,523        162,348
                                              $  7,140,580   $ 6,885,620
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Accounts payable                              $  210,332     $ 196,447
Customer deposits                             122,144        46,960
Accrued and other liabilities                 1,380,941      1,411,941
Income tax liabilities                        202,280        203,313
Financial Services debt                       103,000        —
Senior notes                                  2,999,837      3,088,344
Total liabilities                             5,018,534      4,947,005
Shareholders' equity                          2,122,046      1,938,615
                                              $  7,140,580   $ 6,885,620



PulteGroup, Inc.

Consolidating Statements of Cash Flows

($000's omitted)

(Unaudited)
                                                    Nine Months Ended
                                                    September 30,
                                                    2012          2011
Cash flows from operating activities:
Net income (loss)                                   $ 147,403     $ (224,209)
Adjustments to reconcile net income (loss) to net
cash flows provided by (used in)

 operating activities:
Write-down of land and deposits and pre-acquisition 12,623        11,419
costs
Goodwill impairments                                —             240,541
Depreciation and amortization                       22,278        24,629
Stock-based compensation expense                    14,368        14,444
Equity in (earnings) loss of unconsolidated         (3,836)       (1,999)
entities
Distributions of earnings from unconsolidated       7,223         5,042
entities
Loss on debt repurchases                            —             3,537
Other, net                                          5,254         2,741
Increase (decrease) in cash due to:
Restricted cash                                     (966)         690
Inventories                                         160,973       (174,231)
Residential mortgage loans available-for-sale       (5,275)       2,182
Other assets                                        (1,612)       108,202
Accounts payable, accrued and other liabilities     63,832        (99,674)
Income tax liabilities                              (1,033)       (73,280)
Net cash provided by (used in) operating activities 421,232       (159,966)
Cash flows from investing activities:
Distributions from unconsolidated entities          2,696         4,388
Investments in unconsolidated entities              (1,266)       (3,749)
Net change in loans held for investment             736           449
Change in restricted cash related to letters of     26,096        (89,385)
credit
Proceeds from the sale of fixed assets              4,705         9,449
Capital expenditures                                (10,597)      (15,162)
Net cash provided by (used in) investing activities 22,370        (94,010)
Cash flows from financing activities:
Financial Services borrowings (repayments)          103,000       —
Other borrowings (repayments)                       (92,493)      (68,351)
Issuance of common stock                            27,432        —
Stock repurchases                                   (961)         (2,021)
Net cash provided by (used in) financing activities 36,978        (70,372)
Net increase (decrease) in cash and equivalents     480,580       (324,348)
Cash and equivalents at beginning of period         1,083,071     1,483,390
Cash and equivalents at end of period               $ 1,563,651   $ 1,159,042
Supplemental Cash Flow Information:
Interest paid (capitalized), net                    $ (28,072)    $ (29,457)
Income taxes paid (refunded), net                   $ (12,901)    $ (5,665)



PulteGroup, Inc.

Segment Data

($000's omitted)

(Unaudited)
                        Three Months Ended          Nine Months Ended
                        September 30,               September 30,
                        2012          2011          2012          2011
HOMEBUILDING:
Home sale revenues      $ 1,232,704   $ 1,101,368   $ 3,070,895   $ 2,783,602
Land sale revenues      22,623        12,659        69,770        19,023
Total Homebuilding      1,255,327     1,114,027     3,140,665     2,802,625
revenues
Home sale cost of       1,023,704     947,817       2,605,249     2,422,525
revenues
Land sale cost of       21,061        (2,935)       62,069        1,782
revenues
Selling, general, and   125,191       121,553       372,691       402,379
administrative expenses
Equity in (earnings)
loss of unconsolidated (243)         331           (3,714)       (1,931)
entities
Other expense (income), 7,453         259,187       24,570        274,765
net
Interest income, net    (1,018)       (800)         (2,966)       (2,714)
Income (loss) before    $ 79,179      $ (211,126)   $ 82,766      $ (294,181)
income taxes
FINANCIAL SERVICES:
Income (loss) before    $ 26,727      $ 8,626       $ 49,575      $ (7,044)
income taxes
CONSOLIDATED:
Income (loss) before    $ 105,906     $ (202,500)   $ 132,341     $ (301,225)
income taxes



PulteGroup, Inc.

Segment data, continued

($000's omitted)

(Unaudited)
             Three Months Ended                  Nine Months Ended
             September 30,                       September 30,
             2012              2011              2012             2011
Home sale    $  1,232,704      $  1,101,368      $  3,070,895     $ 2,783,602
revenues
Closings -
units
Northeast    456               515               1,224            1,231
Southeast    776               744               1,984            2,032
Florida      588               621               1,633            1,655
Texas        923               963               2,484            2,505
North        863               721               2,057            1,837
Southwest    812               634               1,969            1,712
             4,418             4,198             11,351           10,972
Average
selling      $  279            $  262            $  271           $ 254
price
Net new
orders -
units
Northeast    432               390               1,599            1,378
Southeast    787               625               2,384            2,108
Florida      679               479               2,147            1,844
Texas        978               775               3,212            2,681
North        939               633               2,872            2,049
Southwest    729               662               2,899            2,071
             4,544             3,564             15,113           12,131
Net new
orders -     $  1,312,490      $  916,552        $  4,257,541     $ 3,125,675
dollars (a)
                                                 September 30,
                                                 2012             2011
Unit backlog
Northeast                                        800              703
Southeast                                        1,002            807
Florida                                          1,172            784
Texas                                            1,553            1,050
North                                            1,524            865
Southwest                                        1,635            934
                                                 7,686            5,143
Dollars in                                       $  2,246,296     $ 1,398,636
backlog
(a) Net new order dollars represent a composite of new order dollars combined
with other movements of the dollars in backlog related to cancellations and
change orders.



PulteGroup, Inc.

Segment Data, continued

($000's omitted)

(Unaudited)
                       Three Months Ended        Nine Months Ended
                       September 30,             September 30,
                       2012         2011         2012           2011
MORTGAGE ORIGINATIONS:
Origination volume     3,073        2,585        7,697          6,667
Origination principal  $ 685,001    $ 549,859    $ 1,681,321    $ 1,363,752
Capture rate           82.6      %  78.1      %  81.3        %  77.1        %



Supplemental Data

($000's omitted)

(Unaudited)
                                Three Months Ended      Nine Months Ended
                                September 30,           September 30,
                                2012        2011        2012        2011
Interest in inventory,          $ 358,451   $ 358,806   $ 355,068   $ 323,379
beginning of period
Interest capitalized            50,730      55,230      153,369     167,367
Interest expensed               (57,155)    (48,693)    (156,411)   (125,403)
Interest in inventory, end of   $ 352,026   $ 365,343   $ 352,026   $ 365,343
period
Interest incurred               $ 50,730    $ 55,230    $ 153,369   $ 167,367



PulteGroup, Inc.
Reconciliation of Non-GAAP Financial Measures

This report contains information about our home sale gross margins reflecting
certain adjustments. This measure is considered a non-GAAP financial measure
under the SEC's rules and should be considered in addition to, rather than as
a substitute for, the comparable GAAP financial measure as a measure of our
operating performance. Management and our local divisions use this measure in
evaluating the operating performance of each community and in making strategic
decisions regarding sales pricing, construction and development pace, product
mix, and other daily operating decisions. We believe it is a relevant and
useful measure to investors for evaluating our performance through gross
profit generated on homes delivered during a given period and for comparing
our operating performance to other companies in the homebuilding industry.
Although other companies in the homebuilding industry report similar
information, the methods used may differ. We urge investors to understand the
methods used by other companies in the homebuilding industry to calculate
gross margins and any adjustments thereto before comparing our measure to that
of such other companies.

The following table sets forth a reconciliation of this non-GAAP financial
measure to the GAAP financial measure that management believes to be most
directly comparable ($000's omitted):



Home Sale Gross Margin
             Three Months Ended
             September30,  June30,       March30,    December31,   September30,
             2012           2012                        2011           2011
                                           2012
Home sale    $ 1,232,704    $ 1,024,405    $ 813,786    $ 1,167,141    $ 1,101,368
revenues
Home sale
cost of      1,023,704      869,379        712,166      1,021,873      947,817
revenues
Home sale    209,000        155,026        101,620      145,268        153,551
gross margin
Add:
Impairments  385            633            3,700        7,885          526
(a)
Capitalized
interest     57,155         52,070         47,186       63,979         48,693
amortization
(a)
Adjusted
home sale    $ 266,540      $ 207,729      $ 152,506    $ 217,132      $ 202,770
gross margin
Home sale
gross margin
as a
             17.0        %  15.1        %  12.5      %  12.4        %  13.9        %

percentage
of home sale
revenues
Adjusted
home sale
gross margin
as a
             21.6        %  20.3        %  18.7      %  18.6        %  18.4        %

percentage
of home sale
revenues
(a) Write-offs of capitalized interest related to
impairments are reflected in capitalized interest
amortization.



SOURCE Pulte Homes, Inc.

Website: http://www.pulte.com
Contact: Investors: Jim Zeumer, +1-248-433-4502, jim.zeumer@pultegroup.com
 
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