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D.R. Horton, Inc., America’s Builder, Reports Fiscal 2013 First Quarter Earnings

  D.R. Horton, Inc., America’s Builder, Reports Fiscal 2013 First Quarter
  Earnings

Business Wire

FORT WORTH, Texas -- January 29, 2013

D.R. Horton, Inc. (NYSE:DHI), America’s Builder, today reported that net
income for its first fiscal quarter ended December 31, 2012 increased 139% to
$66.3 million, or $0.20 per diluted share. Net income for the same quarter of
fiscal 2012 was $27.7 million, or $0.09 per diluted share. Homebuilding
revenue for the first quarter of fiscal 2013 increased 39% to $1.2 billion
from $0.9 billion in the same quarter of 2012. Homes closed in the quarter
increased 26% to 5,182, compared to 4,118 homes in the year-ago quarter.

Net sales orders for the first quarter ended December 31, 2012 increased 39%
to 5,259 homes from 3,794 homes in the year-ago quarter and the value of net
sales orders increased 60% to $1.3 billion from $0.8 billion. The Company’s
cancellation rate (cancelled sales orders divided by gross sales orders) for
the first quarter of fiscal 2013 was 22%. The Company’s sales order backlog of
homes under contract at December 31, 2012 increased 62% to 7,317 homes from
4,530 homes at December 31, 2011. The value of the backlog increased 80% to
$1.8 billion at December 31, 2012 from $1.0 billion a year ago.

The Company ended the quarter with $643.1 million of homebuilding unrestricted
cash and marketable securities and net homebuilding debt to total capital of
33.0%. Net homebuilding debt to total capital consists of homebuilding notes
payable net of cash and marketable securities divided by total equity plus
homebuilding notes payable net of cash and marketable securities.

Donald R. Horton, Chairman of the Board, said, “This quarter was our most
profitable first quarter since 2007, with $107.9 million of pre-tax income, a
270% increase from the year-ago quarter. We experienced substantial increases
in the number of homes sold, closed and in backlog compared to the year-ago
quarter. At the same time, our average sales price has increased due to
pricing power, geographic mix and larger average home size. As a result, we
achieved dollar value increases in homes sold of 60%, homes closed of 38% and
backlog of 80%.

“We experienced broad improvement in demand in most of our markets this
quarter, and we significantly increased our investments in homes under
construction, finished lots, land and land development to capture this
increasing demand. D.R. Horton is the best positioned it has been in its 35
year history. We are looking forward to the spring selling season with
optimism.”

The Company will host a conference call today (Tuesday, January 29^th) at
10:00 a.m. Eastern time. The dial-in number is 877-407-8033, and the call will
also be webcast from www.drhorton.com on the “Investors” page.

D.R. Horton, Inc., America’s Builder, is the largest homebuilder in the United
States, based on its 19,954 homes closed in the twelve-month period ended
December 31, 2012. Founded in 1978 in Fort Worth, Texas, D.R. Horton has
operations in 77 markets in 26 states in the East, Midwest, Southeast, South
Central, Southwest and West regions of the United States. The Company is
engaged in the construction and sale of high quality homes with sales prices
ranging from $100,000 to over $600,000. D.R. Horton also provides mortgage
financing and title services for homebuyers through its mortgage and title
subsidiaries.

Portions of this document may constitute “forward-looking statements” as
defined by the Private Securities Litigation Reform Act of 1995. Although D.R.
Horton believes any such statements are based on reasonable assumptions, there
is no assurance that actual outcomes will not be materially different. All
forward-looking statements are based upon information available to D.R. Horton
on the date this release was issued. D.R. Horton does not undertake any
obligation to publicly update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.
Forward-looking statements in this release include  that D.R. Horton is the
best positioned it has been in its 35 year history and that we are looking
forward to the spring selling season with optimism.

Factors that may cause the actual results to be materially different from the
future results expressed by the forward-looking statements include, but are
not limited to: potential deterioration in homebuilding industry conditions
and the current weak U.S. economy; the cyclical nature of the homebuilding
industry and changes in general economic, real estate and other conditions;
constriction of the credit markets, which could limit our ability to access
capital and increase our costs of capital; reductions in the availability of
mortgage financing and the liquidity provided by government-sponsored
enterprises, the effects of government programs, a decrease in our ability to
sell mortgage loans on attractive terms or an increase in mortgage interest
rates; the risks associated with our land and lot inventory; home warranty and
construction defect claims; supply shortages and other risks for acquiring
land, building materials and skilled labor; reductions in the availability of
performance bonds; increases in the costs of owning a home; the effects of
governmental regulations and environmental matters on our homebuilding
operations; the effects of governmental regulation on our financial services
operations; our debt obligations and our ability to comply with related debt
covenants, restrictions and limitations; competitive conditions within the
homebuilding and financial services industries; our ability to effect any
future growth strategies successfully; the impact of an inflationary or
deflationary environment; our ability to realize the full amount of our
deferred income tax asset; and information technology failures and data
security breaches. Additional information about issues that could lead to
material changes in performance is contained in D.R. Horton’s annual report on
Form 10-K which is filed with the Securities and Exchange Commission.

                      WEBSITE ADDRESS: www.drhorton.com


D.R. HORTON, INC.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
                                                           
                                                December 31,     September 30,
                                                2012             2012
  ASSETS                                        (In millions)
  Homebuilding:
  Cash and cash equivalents                     $  546.4         $  1,030.4
  Marketable securities, available-for-sale        96.7             298.0
  Restricted cash                                  54.8             49.3
  Inventories:
  Construction in progress and finished            1,909.5          1,682.7
  homes
  Residential land and lots - developed and        2,475.7          1,838.4
  under development
  Land held for development                       629.9          644.1    
                                                   5,015.1          4,165.2
  Income taxes receivable                          -                14.4
  Deferred income taxes, net of valuation
  allowance of $41.9 million at December           683.5            709.5
  31, 2012 and September 30, 2012
  Property and equipment, net                      81.9             72.6
  Other assets                                     454.2            456.8
  Goodwill                                        38.9           38.9     
                                                  6,971.5        6,835.1  
  Financial Services:
  Cash and cash equivalents                        20.5             17.3
  Mortgage loans held for sale                     307.9            345.3
  Other assets                                    47.4           50.5     
                                                  375.8          413.1    
                                                $  7,347.3      $  7,248.2  
  LIABILITIES
  Homebuilding:
  Accounts payable                              $  241.8         $  216.2
  Accrued expenses and other liabilities           856.6            893.8
  Notes payable                                   2,424.3        2,305.3  
                                                  3,522.7        3,415.3  
  Financial Services:
  Accounts payable and other liabilities           42.1             50.4
  Mortgage repurchase facility                    169.4          187.8    
                                                  211.5          238.2    
                                                  3,734.2        3,653.5  
                                                                 
  EQUITY
  Common stock                                     3.3              3.3
  Additional paid-in capital                       1,992.2          1,979.8
  Retained earnings                                1,749.2          1,743.1
  Treasury stock, at cost                          (134.3  )        (134.3   )
  Accumulated other comprehensive income          -              0.2      
                                                   3,610.4          3,592.1
  Noncontrolling interests                        2.7            2.6      
                                                  3,613.1        3,594.7  
                                                $  7,347.3      $  7,248.2  

                                        
D.R. HORTON, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(UNAUDITED)
                                                            
                                             Three Months Ended
                                             December 31,
                                              2012              2011   
                                          (In millions, except per share data)
Homebuilding:
    Revenues:
             Home sales                      $  1,223.3           $  884.3
             Land/lot sales and other          9.9                1.3    
                                                                  
                                               1,233.2            885.6  
    Cost of sales:
             Home sales                         992.8                735.6
             Land/lot sales and other           8.2                  -
             Inventory impairments and
             land option cost                  1.3                1.4    
             write-offs
                                                                  
                                               1,002.3            737.0  
    Gross profit:
             Home sales                         230.5                148.7
             Land/lot sales and other           1.7                  1.3
             Inventory impairments and
             land option cost                  (1.3     )          (1.4   )
             write-offs
                                                                  
                                               230.9              148.6  
                                                                  
    Selling, general and administrative         140.8                119.0
    expense
    Interest expense                            3.2                  6.9
    Gain on early retirement of debt,           -                    (0.1   )
    net
    Other (income)                             (3.3     )          (2.2   )
                                                                  
    Operating income from Homebuilding         90.2               25.0   
                                                                  
Financial Services:
    Revenues, net of recourse and               41.9                 21.0
    reinsurance expense
    General and administrative expense          25.7                 18.9
    Interest expense                            1.0                  0.9
    Interest and other (income)                (2.5     )          (3.0   )
                                                                  
    Operating income from Financial            17.7               4.2    
    Services
                                                                  
Income before income taxes                      107.9                29.2
Income tax expense                             41.6               1.5    
                                                                  
Net income                                   $  66.3             $  27.7   
                                                                  
Other comprehensive income (loss), net
of income tax:
Unrealized (loss) gain related to              (0.1     )          0.1    
available-for-sale securities
                                                                  
Comprehensive income                         $  66.2             $  27.8   
                                                                  
Basic:
    Net income per share                     $  0.21             $  0.09   
    Weighted average number of common          321.1              316.3  
    shares
Diluted:
    Net income per share                     $  0.20             $  0.09   
    Numerator for diluted income per
    share after                              $  72.0             $  27.7   
    assumed conversions
    Adjusted weighted average number of        364.1              316.5  
    common shares
                                                                  
Other Consolidated Financial Data:
                                                                  
    Interest amortized to home and           $  24.9             $  20.4   
    land/lot cost of sales
    Depreciation and amortization            $  4.8              $  5.0    
    Interest incurred                        $  38.1             $  28.8   

                                                         
D.R. HORTON, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)

                                                            
                                                            Three Months Ended
                                                            December 31, 2012
                                                            (In millions)
                                                            
  Operating Activities
  Net income                                                $    66.3
  Adjustments to reconcile net income to net cash used
  in operating activities:
  Depreciation and amortization                                  4.8
  Amortization of discounts and fees                             10.4
  Stock based compensation expense                               3.5
  Deferred income taxes                                          35.2
  Gain on sale of marketable securities                          (0.2      )
  Inventory impairments and land option cost write-offs          1.3
  Changes in operating assets and liabilities:
  Increase in construction in progress and finished              (226.8    )
  homes
  Increase in residential land and lots — developed,
  under development, and held for development                    (612.8    )
  Decrease in other assets                                       22.8
  Decrease in income taxes receivable                            14.4
  Decrease in mortgage loans held for sale                       37.4
  Decrease in accounts payable, accrued expenses and            (12.8     )
  other liabilities
  Net cash used in operating activities                         (656.5    )
  Investing Activities
  Purchases of property and equipment                            (14.0     )
  Purchases of marketable securities                             (26.8     )
  Proceeds from the sale or maturity of marketable               226.7
  securities
  Increase in restricted cash                                    (5.5      )
  Net principal increase of other mortgage loans and
  real estate owned                                              (0.2      )
  Purchases of debt securities collateralized by                 (18.6     )
  residential real estate
  Payment related to acquisition of a business                  (9.4      )
  Net cash provided by investing activities                     152.2     
  Financing Activities
  Proceeds from notes payable                                    100.0
  Repayment of notes payable                                     (18.4     )
  Proceeds from stock associated with certain employee           2.1
  benefit plans
  Cash dividends paid                                           (60.2     )
  Net cash provided by financing activities                      23.5
  Decrease in Cash and Cash Equivalents                          (480.8    )
  Cash and cash equivalents at beginning of period              1,047.7   
  Cash and cash equivalents at end of period                $    566.9     

              
                  D.R. HORTON, INC.
                  ($'s in millions)
                                          
                  NET SALES ORDERS
                                              
                  Three Months Ended December 31,
                  2012                2011
                  Homes   Value       Homes   Value
East              528     $ 141.4     509     $ 115.3
Midwest           275       89.9      213       59.1
Southeast         1,584     353.5     921       181.1
South Central     1,641     330.6     1,299     233.2
Southwest         247       53.2      249       46.9
West              984      345.5     603      187.6
                  5,259   $ 1,314.1   3,794   $ 823.2
                                              
                                              
                  HOMES CLOSED
                                              
                  Three Months Ended December 31,
                  2012                2011
                  Homes   Value       Homes   Value
East              517     $ 137.4     495     $ 118.8
Midwest           287       89.4      213       57.7
Southeast         1,374     291.3     1,013     195.6
South Central     1,619     309.3     1,492     266.7
Southwest         383       76.0      279       54.0
West              1,002    319.9     626      191.5
                  5,182   $ 1,223.3   4,118   $ 884.3
                                              
                                              
                  SALES ORDER BACKLOG
                                              
                  As of December 31,
                  2012                2011
                  Homes   Value       Homes   Value
East              674     $ 174.6     620     $ 144.1
Midwest           413       127.9     288       81.9
Southeast         2,419     527.1     1,193     232.4
South Central     2,254     454.8     1,517     276.0
Southwest         563       112.1     396       69.5
West              994      362.2     516      171.1
                  7,317   $ 1,758.7   4,530   $ 975.0

Contact:

D.R. Horton, Inc.
Jessica Hansen, 817-390-8200
Vice President of Communications