Brookfield Residential Reports 2013 First Quarter Results

Brookfield Residential Reports 2013 First Quarter Results 
Net income attributable to shareholders of $4 million or $0.04 per
Strong revenue growth of 29% over the first quarter of 2012 
36% increase in backlog units and 43% increase in backlog value over
the first quarter of 2012 
CALGARY, ALBERTA -- (Marketwired) -- 05/02/13 --  
Investors, analysts and other interested parties can access
Brookfield Residential's first quarter 2013 interim report and
corporate profile on our website at       
The first quarter 2013 results conference call and webcast will be
held on Friday, May 3, 2013 at 11 a.m. (EST).  Dial 1.800.319.4610
toll free in North America or for overseas calls, 1.604.638.5340. 
The call will also be available via webcast live at  The recorded conference call replay
can be accessed until June 3, 2013 by dialing 1.800.319.6413 or
1.604.638.9010 and using code 1231 followed by the # sign. 
(TSX:BRP)(NYSE:BRP) Brookfield Residential Properties Inc.
("Brookfield Residential" or "the Company"), a leading North American
land developer and homebuilder today announced financial results for
the first quarter ended March 31, 2013. The results are based on U.S.
Generally Accepted Accounting Principles (U.S. GAAP). 
Three Months Ended March 31, 2013 

--  Net income increased to $4 million, or $0.04 per share in the first
    quarter, compared to $1 million, or $0.01 per share, in the first
    quarter of 2012 
--  First quarter revenue increased 29% to $171 million over the first
    quarter of 2012 
--  Homebuilding deliveries increased 17% to 294 units compared to the first
    quarter of 2012 
--  Backlog of 1,180 units representing $519 million of value rose 36% and
    43%, respectively, compared to the first quarter of 2012. Average price
    of homes in backlog was $440,000 as at March 31, 2013, compared to
    $420,000 as at March 31, 2012 
--  Gross margin was 30% in the first quarter, compared to 29% in the first
    quarter of 2012 
--  Active housing communities increased to 35, up from 31 in the first
    quarter of 2012 
--  Income before income taxes increased to $7 million compared to $4
    million in the first quarter of 2012 

Results of Operations  

                                                        Three Months Ended  
                                                             March 31       
(US$ millions, except per share amounts)                    2013       2012 
Total revenue                                          $     171  $     132 
Income before income taxes                                     7          4 
Income tax expense                                            (3)        (4)
Net income attributable to Brookfield Residential              4          1 
Basic and diluted earnings per share                   $    0.04  $    0.01 
Total assets                                           $   2,885  $   2,670 
Total liabilities                                      $   1,557  $   1,651 

First Quarter Operational Highlights 

                                                          Three Months Ended
                                                               March 31     
(US$ millions, except per unit activity and avg. selling                    
 price)                                                       2013      2012
Land revenue                                             $      52 $      44
Lot closings for Brookfield Residential (single family                      
 units)                                                        354       274
Lot closings for unconsolidated entities (single family                     
 units)                                                         16         -
Average lot selling price for Brookfield Residential                        
 (single family units)                                   $ 146,000 $ 160,000
Average lot selling price for unconsolidated entities                       
 (single family units)                                   $ 239,000         -
Housing revenue                                          $     119 $      88
Home closings for Brookfield Residential (units)               294       251
Home closings for unconsolidated entities (units)                2        10
Average home selling price for Brookfield Residential    $ 406,000 $ 351,000
Average home selling price for unconsolidated entities   $ 922,000 $ 325,000
Net new orders for Brookfield Residential (units)              657       474
Net new orders for unconsolidated entities (units)              18        18
Backlog for Brookfield Residential (units at end of                         
 period)                                                     1,180       868
Backlog for unconsolidated entities (units at end of                        
 period)                                                        33        22
Backlog value for Brookfield Residential                 $     519 $     364
Backlog value for unconsolidated entities                $      16 $      10

Historically there is variability in our results of operations from
quarter to quarter, due to the seasonal nature of the homebuilding
business and the timing of new community openings and closings.
Typically, the highest rate of orders for new homes and lots occurs
in the first nine months of the calendar year and we generally
deliver a greater percentage of new homes and lots, and see higher
revenues, in the second half of the year. In terms of acre sales,
which are a meaningful part of our business, results are more
variable from year to year given the nature of the development and
monetization cycle.  
Alan Norris, President and Chief Executive Officer of Brookfield
Residential, commented: "We continued to gain momentum in the first
quarter of 2013. Sales in our Canadian operations remained robust and
we ended the quarter with a strong backlog. In our U.S. operations,
first quarter backlog and net new home orders were significantly
higher than a year ago, reflecting the continued recovery in the U.S.
housing market. With demand increasing and supply remaining
constrained in many U.S. markets we are seeing increased price
pressure and anticipate that the remainder of the year will continue
to be strong." 
We completed $117 million of well-located land acquisitions in the
first quarter of 2013, comprising 1,213 lots and 29 acres. We
generally target a 20% unlevered return on investment on our land
acquisitions. In the first quarter, transactions were spread across
many of our markets, with 54% of the acquisitions in Canada and 46%
in the U.S. specifically, in the Bay Area of California and
Washington D.C.  
Our first quarter transactions included the purchase of a property in
the East Bay City of Oakley, California. This acquisition included
567 single family detached lots with entitlements in place. The lots
will be developed in a master-planned community that will include six
neighbourhoods, an apartment, a commercial site and a park in a newly
developed area next to existing schools, residential areas and a
vibrant job market. Homes are expected to be available to interested
buyers in 2014.  
Subsequent to the end of the first quarter, we entered a new market
with a strategic investment in Phoenix, Arizona. As part of a 50/50
joint venture with an affiliate of DMB Associates Inc. ("DMB"), we
acquired the community of Eastmark with approximately 2,255 acres
remaining to be developed by the venture. The land is ideally located
in the top growth corridor of the Phoenix Metro area and is adjacent
to the fast-growing Phoenix-Mesa Gateway Airport. Eastmark is
envisioned to be a large-scale mixed-use community with entitlements
in place for 5,500 residential units, serving a wide range of
residential price points, as well as 9 million square feet of
non-residential use. Brookfield Residential's initial investment is
$12 million to fund ongoing development of the community with all
future funding shared equally with DMB. Involvement in the Eastmark
community aligns with our strengths in developing master-planned and
mixed use projects across North America. 
Our outlook for the year remains positive and we anticipate that
income before income taxes for 2013 will be measurably higher than
2012. We offer the following limited operational guidance for 2013: 

--  Canadian operations are projected to close approximately 1,400 single
    family lots, 100 acres of multi-family, commercial and industrial
    parcels as well as 1,300 homes;  
--  U.S. operations are expected to close approximately 800 single family
    lots, 30 acres of multi-family, commercial and industrial parcels and
    900 homes, which include our share of unconsolidated entities.  

Overall, we expect to open 16 new communities in the remainder of
2013, with most of the financial impact of these openings to be
reflected in 2014 and beyond. Adjusting for communities which we
expect will sell out in the next three quarters, we expect to end
2013 with approximately 44 communities in active selling phases,
which include our unconsolidated entities.  
This coming year, we anticipate that our Canadian operations will
continue to be a strong contributor to our results and that we will
see an improvement in the U.S. as these markets continue to recover.
Based on our current land holdings and recent price increases, we are
optimistic about our increasing profitability continuing in 2014 and
beyond. By 2015, we hope to see results in the U.S. approach
profitability levels currently seen in Canada, assuming the ongoing
market recovery.  
The attached financial statements are based primarily on information
extracted from our financial statements for the three months ended
March 31, 2013. The financial statements were prepared using the
standards and interpretations currently issued under U.S. GAAP.  
The interim report and the Company's corporate profile for the
quarter ended March 31, 2013 contain further information on our
strategy, operations, financial results and outlook. Shareholders are
encouraged to read these documents, which are available on our
website at 
Brookfield Residential Properties Inc. is a leading North American
land developer and homebuilder with operations in eleven major
markets. We entitle and develop land to create master-planned
communities and build and sell lots to third-party builders, as well
as to our own homebuilding division. We also participate in selected,
strategic real estate opportunities, including infill projects,
mixed-use developments, infrastructure projects, and joint ventures.
Brookfield Residential is listed on the NYSE and TSX under the symbol
Please note that Brookfield Residential's unaudited interim reports
and audited annual report are filed on EDGAR and SEDAR and can also
be found in the investor section of our website at Hard copies of the interim and annual reports
can be obtained free of charge upon request.  
For more information, please visit our website at 
Note: This news release contains "forward-looking statements" within
the meaning of Canadian securities laws and United States federal
securities laws. Certain statements in this news release that are not
historical facts, including information concerning possible or
assumed future results of operations of the company, potential
acquisition opportunities, characteristics and development of the
Oakley and Eastmark communities, expected community count growth and
projected opening timelines, projected number of communities in
active selling phases, guidance for 2013, anticipated improvements in
the U.S. markets and continued strength in the Canadian markets, the
company's 2013 outlook, and those statements preceded by, followed
by, or that include the words "believe," "projected," "planned,"
"anticipate," "should," "goals," "expected," "potential," "estimate,"
"targeted," "scheduled" or similar expressions, constitute
"forward-looking statements." 
Undue reliance should not be placed on forward-looking statements
because they involve known and unknown risks, uncertainties and other
factors, which may cause the actual results to differ materially from
the anticipated future results expressed or implied by such
forward-looking statements. Factors that could cause actual results
to differ materially from those set forward in the forward-looking
statements include, but are not limited to: changes in general
economic, real estate and other conditions; changes in interest
rates; mortgage rate changes; availability of suitable undeveloped
land at acceptable prices; adverse legislation or regulation; ability
to obtain necessary permits and approvals for the development of our
land; availability of labour or materials or increases in their
costs; ability to develop and market our master-planned communities
successfully; laws and regulations related to property development
and to the environment that could lead to additional costs and
delays; confidence levels of consumers; ability to raise capital on
favourable terms; our debt and leverage; adverse weather conditions
and natural disasters; relations with the residents of our
communities; risks associated with increased insurance costs or
unavailability of adequate coverage and ability to obtain surety
bonds; competitive conditions in the homebuilding industry, including
product and pricing pressures; ability to retain our executive
officers; relationships with our affiliates; any increase in
unemployment or underemployment; decline of the market value of our
land and housing inventories; significant inflation or deflation;
inability to raise capital on favorable terms or at all; failure in
our financial and commercial controls; changes to foreign currency
exchange rates; difficultly enforcing civil liabilities in the United
States against us and our directors and officers; higher cancellation
rates of existing agreements of sale; major health and safety
incident relating to our business; utility and resource shortages or
rate fluctuations; and additional risks and uncertainties referred to
in our filings with the securities regulators in Canada and the
United States, many of which are beyond our control. Except as
required by law, we undertake no obligation to publicly update any
forward-looking statements, whether as a result of new information,
future events or otherwise. However, any further disclosures made on
related subjects in subsequent reports should be consulted. 

                   Brookfield Residential Properties Inc.                   
              Condensed Consolidated Statements of Operations               
                                                Three Months Ended March 31 
(US$ thousands, except per share amounts)               2013           2012 
Land                                            $     51,713  $      43,995 
Housing                                              119,309         88,154 
                                                     171,022        132,149 
Direct Cost of Sales                                                        
Land                                                 (23,239)       (19,999)
Housing                                              (96,704)       (73,361)
                                                      51,079        38,789  
Selling, general and administrative expense         (36,252)       (26,092) 
Equity in earnings from unconsolidated entities        1,794         1,623  
Depreciation                                           (999)          (774) 
Interest expense                                    (10,506)       (10,153) 
Other income                                           1,852            516 
Income Before Income Taxes                             6,968          3,909 
Current income tax recovery / (expense)                   60         (6,291)
Deferred income tax (expense) / recovery              (2,632)         2,597 
Net Income                                             4,396            215 
Net (income) / loss attributable to non-                                    
 controlling interests and other interests in                               
 consolidated subsidiaries                              (120)           400 
Net Income Attributable to Brookfield                                       
 Residential                                    $      4,276  $         615 
Other Comprehensive Income                                                  
Unrealized foreign exchange gain / (loss) on:                               
Translation of the net investment in Canadian                               
 subsidiaries                                        (19,186)        14,573 
Translation of the Canadian dollar denominated                              
 debt designated as a hedge of the net                                      
 investment in Canadian subsidiaries                       -        (11,472)
Comprehensive (Loss) / Income Attributable to                               
 Brookfield Residential                         $    (14,910) $       3,716 
Earnings per Common Share Attributable to Brookfield Residential            
  Basic                                         $       0.04  $        0.01 
  Diluted                                       $       0.04  $        0.01 
Weighted Average Common Shares Outstanding (in                              
  Basic                                              116,316         99,606 
  Diluted                                            117,269         99,945 
                   Brookfield Residential Properties Inc.                   
                    Condensed Consolidated Balance Sheets                   
                                                              As at         
                                                       March 31,    Dec. 31,
(US$ thousands)                                             2013        2012
Land and housing inventory                           $ 2,351,835 $ 2,250,256
Investments in unconsolidated entities                   162,425     155,352
Commercial Properties                                     15,013      15,363
Receivables and other assets                             306,753     320,248
Restricted cash                                           12,140      13,596
Cash and cash equivalents                                 30,270      49,826
Deferred income tax assets                                 6,604      10,552
                                                     $ 2,885,040 $ 2,815,193
Liabilities and Equity                                                      
Project specific and other financings                $   602,559 $   459,329
Notes payable                                            601,145     590,845
Total financings                                       1,203,704   1,050,174
Accounts payable and other liabilities                   353,243     425,179
Total liabilities                                      1,556,947   1,475,353
Other interests in consolidated subsidiaries              33,515      32,445
Total equity                                           1,294,578   1,307,395
                                                     $ 2,885,040 $ 2,815,193

Brookfield Residential Properties Inc.
Nicole French
Manager, Investor Relations & Communications
Brookfield Residential Properties Inc.
Andrew Willis
SVP, Communications & Media
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