M.D.C. Holdings Announces 2013 First Quarter Results

             M.D.C. Holdings Announces 2013 First Quarter Results

PR Newswire

DENVER, May 2, 2013

DENVER, May 2, 2013 /PRNewswire/ -- M.D.C. Holdings, Inc. (NYSE: MDC)
announced results for the quarter ended March 31, 2013.

2013 First Quarter Highlights and Comparisons to 2012 First Quarter

  oNet income of $22.5 million, or $0.45 per diluted share vs. net income of
    $2.3 million, or $0.04 per diluted share
  oNet new orders of 1,300 homes, up 22%
  oBacklog of 1,927 homes, up 30%; backlog dollar value up 45% to $693.1
    million
  oHome sale revenues of $331.7 million, up 80%
  oHomes delivered of 1,018, up 64%
  oGross margin from home sales of 17.4% vs. 14.1%, a 330 basis point
    increase

       oImprovement of 70 basis points vs. 16.7% in 2012 fourth quarter

  oSG&A expenses as a percentage of home sale revenues of 14.5% vs. 18.5%, a
    400 basis point improvement
  oHomebuilding pretax income of $14.8 million vs. loss of $2.7 million
  oFinancial services segment pretax profit of $7.7 million vs. pretax profit
    of $4.9 million
  oAcquired 1,652 lots in 53 communities, including 28 new communities

       oTotal land acquisition spend of $118.0 million

Larry A. Mizel, MDC's Chairman and Chief Executive Officer, stated, "I am
pleased to announce a first quarter profit of $0.45 per diluted share, our
fifth consecutive quarterly operating profit, with net income improving by
$20.3 million over the prior year. Our favorable results were mostly
attributable to significantly improved operating profits from our homebuilding
segment, which continued to benefit from strong execution by our management
team amidst improving market conditions, leading to increased volume and
margin."

Mr. Mizel continued, "Even after achieving significant order growth throughout
2012, during the first quarter of 2013 we realized a further 22%
year-over-year increase on the strength of a monthly absorption rate of 3.0
net new home orders per active community, our highest level since 2006. The
continued strengthening of our sales pace occurred even as we increased prices
in most of our active subdivisions, reflecting an environment of improving
demand for and low supply of single-family housing. Our focus on pricing has
allowed us to again improve our gross margin percentage on both a sequential
and year-over-year basis. Going forward, even though we expect increases in
land and building costs based on improving demand, we continue to believe that
it is a reasonable goal for our Company to improve gross margins on a
sequential basis for the remainder of 2013."

Mr. Mizel concluded, "The improvement in our gross margin during the quarter
complemented a year-over-year increase in our home sale revenues of 80%,
thereby driving significant operating leverage for our Company, as evidenced
by a 600 basis point expansion in our homebuilding pretax operating margin to
4.5%. Based on the strength of our backlog, which ended the quarter with a
sales value up 45% from a year ago, we believe that we are in a strong
position to drive revenue increases to improve our operating leverage further
in future periods. Given the expanding volume for our business, we remain
focused on controlling land for our future and ended the first quarter with
more than 12,700 lots controlled, an increase of 11% from the end of the 2012
fourth quarter. Furthermore, many of the new subdivisions we have acquired
over the past few quarters have recently opened, giving us the opportunity to
increase our active subdivision count in the second quarter on a sequential
basis for the first time in six quarters."

Homebuilding

Home sale revenues for the 2013 first quarter increased 80% to $331.7 million
compared to $184.7 million for the prior year period. The increase in
revenues resulted primarily from a 64% increase in homes delivered to 1,018
homes as compared to 619 in the prior year. The Company's average selling
price for homes closed was $325,900, up 9% year-over-year compared to $298,300
for the prior year period, largely due to price appreciation and lower
incentives in many of our markets.

Gross margin from home sales for the 2013 first quarter increased to 17.4%
from 14.1% for the year-earlier period. On a sequential basis, our 2013 first
quarter gross margin from home sales was up 70 basis points as compared to
16.7% for the 2012 fourth quarter. The increase was attributable to the
Company's continued increases in pricing and decreased incentives in most of
its markets over the prior 12 months.

SG&A expenses as a percentage of home sales revenues decreased by 400 basis
points to 14.5% for the 2013 first quarter versus 18.5% for the same period in
2012. The improvement was the result of operating leverage created by the
Company's 80% year-over-year increase in home sale revenues, which far
outpaced a year-over-year increase in the Company's absolute level of SG&A
expenses.

Net new orders for the 2013 first quarter increased 22% to 1,300 homes,
compared to 1,063 homes during the same period in 2012. The Company's monthly
sales absorption rate for the 2013 first quarter rose 60% to 3.0 per
community, compared to 1.9 per community for the 2012 first quarter. The
Company's cancellation rate for the 2013 first quarter was 18% versus 21% in
the prior year first quarter and 24% in the 2012 fourth quarter.

The Company ended the 2013 first quarter with 1,927 homes in backlog, with an
estimated sales value of $693.1 million, compared with a backlog of 1,487
homes with an estimated sales value of $477.1 million at March 31, 2012.

At March 31, 2013, we had 139 active subdivisions, down 6% from December 31,
2012, however, our lots owned and under option increased by 11% since December
31, 2012 to more than 12,700 lots. While we accelerated our land acquisition
activity in the latter half of 2012 and into 2013, higher than expected sales
rates over the past year resulted in various subdivisions selling out more
quickly than anticipated. Additionally, many of the new subdivisions acquired
over the past few quarters have recently opened, but did not yet meet our
internal definition of an "active community" as of the end of the 2013 first
quarter. As a result, at the end of the 2013 first quarter, the number of
subdivisions classified as "soon to be active" exceeded the number classified
as "soon to be inactive" for the first time in six quarters.

Financial Services

Income before taxes from our financial services operations for the 2013 first
quarter was $7.7 million, compared to $4.9 million for the 2012 first
quarter. The increase in pretax income primarily reflected a $2.7 million
increase in our mortgage operations pretax income to $6.0 million for the 2013
first quarter, compared to $3.3 million in the 2012 first quarter. The
improvement in our mortgage profitability was driven primarily by
year-over-year increases in the volume of loans locked and originated.

About MDC

Since 1972, MDC's subsidiary companies have built and financed the American
dream for more than 170,000 homebuyers. MDC's commitment to customer
satisfaction, quality and value is reflected in each home its subsidiaries
build. MDC is one of the largest homebuilders in the United States. Its
subsidiaries have homebuilding operations across the country, including the
metropolitan areas of Denver, Colorado Springs, Salt Lake City, Las Vegas,
Phoenix, Tucson, Riverside-San Bernardino, Los Angeles, San Francisco Bay
Area, Washington D.C., Baltimore, Philadelphia, Jacksonville and Seattle. The
Company's subsidiaries also provide mortgage financing, insurance and title
services, primarily for Richmond American homebuyers, through HomeAmerican
Mortgage Corporation, American Home Insurance Agency, Inc. and American Home
Title and Escrow Company, respectively. M.D.C. Holdings, Inc. is traded on the
New York Stock Exchange under the symbol "MDC." For more information, visit
www.mdcholdings.com.

Forward-Looking Statements

Certain statements in this release, including statements regarding our
business, financial condition, results of operation, cash flows, strategies
and prospects, constitute "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
that may cause the actual results, performance or achievements of the Company
to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Such
factors include, among other things, (1) general economic conditions,
including changes in consumer confidence, inflation or deflation and
employment levels; (2) changes in business conditions experienced by the
Company, including cancellation rates, net home orders, home gross margins,
land and home values and subdivision counts; (3) changes in interest rates,
mortgage lending programs and the availability of credit; (4) changes in the
market value of the Company's investments in marketable securities; (5)
uncertainty in the mortgage lending industry, including repurchase
requirements associated with HomeAmerican's sale of mortgage loans (6)the
relative stability of debt and equity markets; (7) competition; (8) the
availability and cost of land and other raw materials used by the Company in
its homebuilding operations; (9)the availability and cost of performance
bonds and insurance covering risks associated with our business; (10)
shortages and the cost of labor; (11) weather related slowdowns; (12) slow
growth initiatives; (13) building moratoria; (14) governmental regulation,
including the interpretation of tax, labor and environmental laws; (15)
terrorist acts and other acts of war; and (16)other factors over which the
Company has little or no control. Additional information about the risks and
uncertainties applicable to the Company's business is contained in the
Company's Form 10-Q for the quarter ended March 31, 2013, which is scheduled
to be filed with the Securities and Exchange Commission today. All
forward-looking statements made in this press release are made as of the date
hereof, and the risk that actual results will differ materially from
expectations expressed in this press release will increase with the passage of
time. The Company undertakes no duty to update publicly any forward-looking
statements, whether as a result of new information, future events or
otherwise. However, any further disclosures made on related subjects in our
subsequent filings, releases or webcasts should be consulted.

*Please see "Reconciliation of Non-GAAP Financial Measures" at the end of this
release.





M.D.C. HOLDINGS, INC.
Consolidated Statements of Operations and Comprehensive Income
                                      Three Months
                                      Ended March 31,
                                      2013                   2012
                                      (Dollars in thousands, except per share
                                      amounts)
 Homebuilding:                        (Unaudited)
  Home sale revenues                  $   331,748          $   184,678
  Land sale revenues                  -                      1,590
      Total home sale and land        331,748                186,268
      revenues
  Home cost of sales                  (274,076)              (158,654)
  Land cost of sales                  -                      (1,490)
      Total cost of sales             (274,076)              (160,144)
       Gross margin              57,672                 26,124
       Gross margin %            17.4%                  14.0%
  Selling, general and                (48,201)               (34,124)
  administrative expenses
  Interest income                     6,182                  5,913
  Interest expense                    (817)                  (808)
  Other income (expense), net         11                     158
       Homebuilding pretax       14,847                 (2,737)
      income (loss)
 Financial Services:
  Revenues                            12,506                 7,720
  Expenses                            (5,642)                (3,665)
  Interest and other income           875                    807
       Financial services        7,739                  4,862
      pretax income
 Income before income taxes           22,586                 2,125
 Benefit from (provision for)         (70)                   140
 income taxes
 Net income                           $    22,516         $     2,265
 Other comprehensive income:
 Unrealized gain related to
 available for sales securities       2,535                  6,548
 Tax effect                           -                      -
 Comprehensive income                 $    25,051         $     8,813
 Earnings per share:
      Basic                           $      0.46       $      0.04
      Diluted                         $      0.45       $      0.04
 Weighted average common shares
 outstanding:
      Basic                           48,342,145             47,311,840
      Diluted                         48,922,335             47,382,921
 Dividends declared per share         $         -    $      0.25







M.D.C. HOLDINGS, INC.
Consolidated Balance Sheets
                                       March 31,            December 31,
                                       2013                  2012
ASSETS                                 (Dollars in thousands, except per share
                                       amounts)
Homebuilding:                          (Unaudited)
Cash and cash equivalents              $    183,236       $   129,535
Marketable securities                  626,707               519,465
Restricted cash                        2,526                 1,859
Trade and other receivables            31,885                28,163
Inventories:
Housing completed or under             521,661               512,949
construction
Land and land under development        534,438               489,572
Total inventories                      1,056,099             1,002,521
Property and equipment, net            33,056                33,125
Deferred tax asset, net of valuation
allowance of $238,795 and $248,306 at
March 31, 2013 and December 31, 2012,  -                     -
respectively
Other assets                           52,274                44,777
Total homebuilding assets              1,985,783             1,759,445
Financial Services:
Cash and cash equivalents              32,444                30,560
Marketable securities                  33,292                32,473
Mortgage loans held-for-sale, net      86,429                119,953
Other assets                           4,386                 3,010
Total financial services assets        156,551               185,996
 Total Assets                     $  2,142,334        $  1,945,441
LIABILITIES AND EQUITY
Homebuilding:
Accounts payable                      $     21,712      $    73,055
Accrued liabilities                    115,139               118,456
Senior notes, net                      995,032               744,842
Total homebuilding liabilities         1,131,883             936,353
Financial Services:
Accounts payable and accrued           54,540                51,864
liabilities
Mortgage repurchase facility           41,468                76,327
Total financial services liabilities   96,008                128,191
 Total Liabilities                1,227,891             1,064,544
Stockholders' Equity
Preferred stock, $0.01 par value;
25,000,000 shares authorized; none     -                     -
issued or outstanding
Common stock, $0.01 par value;
250,000,000 shares authorized;
48,869,726 issued and outstanding at
March 31, 2013 and 48,698,757 issued
and outstanding, respectively, at      489                   487
December 31, 2012
Additional paid-in-capital             905,354               896,861
Retained earnings                      1,227                 (21,289)
Accumulated other comprehensive        7,373                 4,838
income (loss)
Total Stockholders' Equity             914,443               880,897
Total Liabilities and Stockholders'    $  2,142,334        $  1,945,441
Equity







M.D.C. HOLDINGS, INC.
Consolidated Statement of Cash Flows
                                                Three Months Ended March 31,
                                                2013             2012
                                                (Dollars in thousands)
                                                (Unaudited)
Operating Activities:
Net income                                      $  22,516       $   2,265
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Stock-based compensation expense                3,376            2,611
Depreciation and amortization                  1,078            1,307
Write-offs of land option deposits              226              82
Amortization of discount (premiums)on          619              (152)
marketable debt securities
 Net changes in assets and liabilities:
 Restricted cash                           (667)            (413)
 Trade and other receivables               (3,970)          (11,062)
 Mortgage loans held-for-sale              33,524           23,345
 Housing completed or under construction   (8,618)          (45,875)
 Land and land under development           (44,770)         17,000
 Other assets                              (6,696)          3,394
 Accounts payable and accrued liabilities  (52,036)         (11,315)
Net cash used in operating activities           (55,418)         (18,813)
Investing Activities:
Purchase of marketable securities               (150,811)        (185,610)
Sale of marketable securities                   44,668           182,021
Purchase of property and equipment              (926)            (364)
Net cash used in investing activities           (107,069)        (3,953)
Financing Activities:
Payments on mortgage repurchase facility        (79,769)         (53,625)
Advances on mortgage repurchase facility        44,910           30,763
Dividend payments                               -                (11,994)
Proceeds from issuance of senior notes          247,813          -
Proceeds from exercise of stock options         5,118            -
Net cash provided by (used in) financing        218,072          (34,856)
activities
Net increase (decrease) in cash and cash        55,585           (57,622)
equivalents
Cash and cash equivalents:
 Beginning of period                       160,095          343,361
 End of period                             $ 215,680        $ 285,739







M.D.C. HOLDINGS, INC.
Homebuilding Operational Data
New Home Deliveries:
            Three Months Ended March 31,
            2013                        2012                        % Change
            Homes  Dollar  Average  Homes  Dollar  Average  Homes  Dollar  Average
                     Value   Price             Value   Price             Value   Price
            (Dollars in thousands)
Arizona    140      $       $ 236.9   88       $       $ 204.1   59%      85%      16%
                     33,161                      17,957
California 146      49,589   339.7     55       17,993   327.1     165%     176%     4%
Nevada     133      32,745   246.2     106      21,596   203.7     25%      52%      21%
Washington  61       19,484   319.4     44       11,996   272.6     39%      62%      17%
West       480      134,979  281.2     293      69,542   237.3     64%      94%      18%
Colorado   304      113,488  373.3     125      44,963   359.7     143%     152%     4%
Utah       67       19,889   296.9     52       14,100   271.2     29%      41%      9%
Mountain   371      133,377  359.5     177      59,063   333.7     110%     126%     8%
Maryland   54       21,704   401.9     44       18,794   427.1     23%      15%      -6%
Virginia   63       29,119   462.2     59       26,155   443.3     7%       11%      4%
Florida    50       12,569   251.4     46       11,124   241.8     9%       13%      4%
East       167      63,392   379.6     149      56,073   376.3     12%      13%      1%
Total      1,018    $        $ 325.9   619      $        $ 298.3   64%      80%      9%
                     331,748                     184,678

Net New Orders:
            Three Months Ended March 31,
            2013                        2012                        % Change
            Homes  Dollar  Average  Homes  Dollar  Average  Homes  Dollar  Average
                     Value   Price             Value   Price             Value   Price
            (Dollars in thousands)
Arizona    127      $       $ 238.5  187      $       $ 204.1  -32%     -21%     17%
                     30,293                      38,174
California 164      60,401   368.3     121      40,131   331.7     36%      51%      11%
Nevada     170      47,042   276.7     166      33,716   203.1     2%       40%      36%
Washington  93       28,546   306.9     76       22,696   298.6     22%      26%      3%
West       554      166,282  300.1     550      134,717  244.9     1%       23%      23%
Colorado   418      147,589  353.1     235      84,147   358.1     78%      75%      -1%
Utah       65       20,238   311.4     68       18,804   276.5     -4%      8%       13%
Mountain   483      167,827  347.5     303      102,951  339.8     59%      63%      2%
Maryland   90       38,450   427.2     83       34,607   417.0     8%       11%      2%
Virginia   93       48,656   523.2     90       41,358   459.5     3%       18%      14%
Florida    80       19,981   249.8     36       8,134    225.9     122%     146%     11%
Illinois    -        -        -         1        235      235.0     N/M      N/M      N/M
East       263      107,087  407.2     210      84,334   401.6     25%      27%      1%
Total      1,300    $        $ 339.4  1,063    $        $ 302.9  22%      37%      12%
                     441,196                     322,002
N/M - Not meaningful



Active Subdivisions:
                          March 31,
                          2013   2012  % Change
Arizona                  16     22    -27%
California               12     18    -33%
Nevada                   9      20    -55%
Washington                12     11    9%
West                     49     71    -31%
Colorado                 36     48    -25%
Utah                     9      17    -47%
Mountain                 45     65    -31%
Maryland                 19     18    6%
Virginia                 12     16    -25%
Florida                  14     16    -13%
East                      45     50    -10%
Total                    139    186   -25%
Average for quarter ended 143    187   -24%

Backlog:
            March 31,
            2013                        2012                        % Change
            Homes  Dollar  Average  Homes  Dollar  Average  Homes  Dollar  Average
                     Value   Price             Value   Price             Value   Price
            (Dollars in thousands)
Arizona    137      $       $ 235.2   227      $       $ 215.8   -40%     -34%     9%
                     32,224                      48,990
California 247      89,688   363.1     184      61,745   335.6     34%      45%      8%
Nevada     241      64,216   266.5     216      42,517   196.8     12%      51%      35%
Washington  111      36,118   325.4     86       25,900   301.2     29%      39%      8%
West       736      222,246  302.0     713      179,152  251.3     3%       24%      20%
Colorado   584      212,109  363.2     343      127,092  370.5     70%      67%      -2%
Utah       79       25,556   323.5     84       23,705   282.2     -6%      8%       15%
Mountain   663      237,665  358.5     427      150,797  353.2     55%      58%      2%
Maryland   219      95,970   438.2     152      64,121   421.8     44%      50%      4%
Virginia   215      111,823  520.1     134      67,095   500.7     60%      67%      4%
Florida    94       25,350   269.7     60       15,725   262.1     57%      61%      3%
Illinois    -        -        -         1        245      245.0     N/M      N/M      N/M
East        528      233,143  441.6     347      147,186  424.2     52%      58%      4%
Total      1,927    $        $ 359.7   1,487    $        $ 320.9   30%      45%      12%
                     693,054                     477,135
N/M - Not meaningful



Homes Completed or Under Construction (WIP lots):
                                            March 31,
                                            2013   2012   % Change
Unsold
Completed                                   222    147    51%
Under construction                          514    380    35%
Total unsold started homes                 736    527    40%
Sold homes under construction or completed  1,345  872    54%
Model homes                                221    236    -6%
Total homes completed or under construction 2,302  1,635  41%



Lots Owned and Optioned (including homes completed or under construction):
             March 31, 2013               March 31, 2012
             Lots      Lots       Total   Lots   Lots      Total   Total %
             Owned     Optioned           Owned  Optioned          Change
Arizona     2,146     40         2,186   872    118       990     121%
California  997       -          997     1,329  -         1,329   -25%
Nevada      1,442     39         1,481   1,030  75        1,105   34%
Washington   493       168        661     439    97        536     23%
West         5,078     247        5,325   3,670  290       3,960   34%
Colorado    3,336     1,327      4,663   3,128  363       3,491   34%
Utah        465       13         478     528    -         528     -9%
Mountain     3,801     1,340      5,141   3,656  363       4,019   28%
Maryland    592       297        889     653    400       1,053   -16%
Virginia    507       287        794     649    156       805     -1%
Florida     479       113        592     289    255       544     9%
Illinois    -         -          -       125    -         125     N/M
East         1,578     697        2,275   1,716  811       2,527   -10%
Total       10,457    2,284      12,741  9,042  1,464     10,506  21%

N/M - Not meaningful

SOURCE M.D.C. Holdings, Inc.

Website: http://www.richmondamerican.com
Contact: Robert N. Martin, Vice President of Finance and Corporate Controller,
(720) 977-3431, bob.martin@mdch.com