Beazer Homes Reports First Quarter Fiscal 2014 Results Business Wire ATLANTA -- January 30, 2014 Beazer Homes USA, Inc. (NYSE: BZH) (www.beazer.com) today announced its financial results for the quarter ended December31, 2013. Highlights for the quarter included a 310 basis point improvement in homebuilding gross margins, an 18.6% increase in average sales prices and adjusted EBITDA of $21.6 million, nearly triple the amount recorded a year ago. “We continued to make year-over-year improvements in our key operational metrics during the quarter,” said Allan Merrill, CEO of Beazer Homes. “Higher sales per community, average sales prices and gross margins led us to improved adjusted EBITDA and kept us on track to achieve full year profitability for Fiscal 2014.” Summary results for the quarter ended December31, 2013 are as follows: Q1 Results from Continuing Operations (unless otherwise specified) Quarter Ended December 31, 2013 2012 Change New Home Orders 895 932 (4.0 )% Orders per month per community 2.2 2.1 4.8 % LTM orders per month per community 2.9 2.5 16.0 % Cancellation rates 21.8 % 26.4 % -460 bps Total Home Closings 1,038 1,038 — % Average sales price from closings (in $ 279.3 $ 235.5 18.6 % thousands) Homebuilding revenue (in millions) $ 290.0 $ 244.4 18.6 % Homebuilding gross profit margin, excluding impairments and abandonments 18.8 % 14.7 % 410 bps (I&A) Homebuilding gross profit margin, excluding I&A and interest amortized 21.2 % 18.1 % 310 bps to cost of sales Loss from continuing operations before $ (3.9 ) $ (19.2 ) $ 15.3 income taxes (in millions) Benefit from income taxes (in $ — $ 0.3 $ (0.3 ) millions) Net loss from continuing operations $ (3.9 ) $ (18.9 ) $ 15.0 (in millions) Basic Loss Per Share $ (0.16 ) $ (0.78 ) $ 0.62 Inventory impairments (in millions) $ — $ (0.2 ) $ 0.2 Net loss from continuing operations excluding inventory impairments (in $ (3.9 ) $ (18.7 ) $ 14.8 millions) Land and land development spending (in $ 123.8 $ 90.0 $ 33.8 millions) Total Company Adjusted EBITDA (in $ 21.6 $ 7.7 $ 13.9 millions) As of December31, 2013 *Total cash and cash equivalents: $431.7 million, including unrestricted cash of approximately $382.6 million *Stockholders' equity: $235.6 million *Total backlog from continuing operations: 1,750 homes with a sales value of $500.0 million, compared to 1,817 homes with a sales value of $478.3 million as of December31, 2012 *Land and lots controlled: 28,978 lots (79.0% owned), an increase of 15.4% from December31, 2012 Conference Call The Company will hold a conference call on January 31, 2014 at 11:00 am ET to discuss these results. Interested parties may listen to the conference call and view the Company's slide presentation over the Internet by visiting the “Investor Relations” section of the Company's website at www.beazer.com. To access the conference call by telephone, listeners should dial 800-619-8639 (for international callers, dial 312-470-7002). To be admitted to the call, verbally supply the passcode "BZH". A replay of the call will be available shortly after the conclusion of the live call. To directly access the replay, dial 800-685-6061 or 203-369-3604 and enter the passcode “3740” (available until 9:30 pm ET on February 7, 2014), or visit www.beazer.com. A replay of the webcast will be available at www.beazer.com for at least 30 days. Headquartered in Atlanta, Beazer Homes is one of the country's 10 largest single-family homebuilders. The Company's homes meet or exceed the benchmark for energy-efficient home construction as established by ENERGY STAR® and are designed with flexible floorplan options to meet the personal preferences and lifestyles of its buyers. In addition, the Company is committed to providing a range of preferred lender choices to facilitate transparent competition between lenders and enhanced customer service. The Company offers homes in 16 states, including Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas and Virginia. Beazer Homes is listed on the New York Stock Exchange under the ticker symbol “BZH.” For more info visit Beazer.com, or check out Beazer on Facebook and Twitter. This press release contains forward-looking statements. These forward-looking statements represent our expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of our control, that could cause actual results to differ materially from the results discussed in the forward-looking statements, including, among other things, (i) the availability and cost of land and the risks associated with the future value of our inventory such as additional asset impairment charges or writedowns; (ii) economic changes nationally or in local markets, including changes in consumer confidence, declines in employment levels, inflation and increases in the quantity and decreases in the price of new homes and resale homes in the market; (iii) the cyclical nature of the homebuilding industry and a potential deterioration in homebuilding industry conditions; (iv) estimates related to homes to be delivered in the future (backlog) are imprecise as they are subject to various cancellation risks which cannot be fully controlled; (v) shortages of or increased prices for labor, land or raw materials used in housing production; (vi) our cost of and ability to access capital and otherwise meet our ongoing liquidity needs including the impact of any downgrades of our credit ratings or reductions in our tangible net worth or liquidity levels; (vii) our ability to comply with covenants in our debt agreements or satisfy such obligations through repayment or refinancing; (viii) a substantial increase in mortgage interest rates, increased disruption in the availability of mortgage financing, a change in tax laws regarding the deductibility of mortgage interest, or an increased number of foreclosures; (ix) increased competition or delays in reacting to changing consumer preference in home design; (x) factors affecting margins such as decreased land values underlying land option agreements, increased land development costs on communities under development or delays or difficulties in implementing initiatives to reduce production and overhead cost structure; (xi) estimates related to the potential recoverability of our deferred tax assets; (xii) potential delays or increased costs in obtaining necessary permits as a result of changes to, or complying with, laws, regulations, or governmental policies and possible penalties for failure to comply with such laws, regulations and governmental policies; (xiii) the results of litigation or government proceedings and fulfillment of the obligations in the Deferred Prosecution Agreement and consent orders with governmental authorities and other settlement agreements; (xiv) the impact of construction defect and home warranty claims; (xv) the cost and availability of insurance and surety bonds; (xvi) the performance of our unconsolidated entities and our unconsolidated entity partners; (xvii) delays in land development or home construction resulting from adverse weather conditions; (xviii) the impact of information technology failures or data security breaches; (xix) effects of changes in accounting policies, standards, guidelines or principles; or (xx) terrorist acts, acts of war and other factors over which the Company has little or no control. Any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by law, we do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time and it is not possible for management to predict all such factors. BEAZER HOMES USA, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ($ in thousands, except per share data) Three Months Ended December 31, 2013 2012 Total revenue $ 293,170 $ 246,902 Home construction and land sales expenses 238,469 210,614 Inventory impairments and option contract 31 204 abandonments Gross profit 54,670 36,084 Commissions 11,821 10,642 General and administrative expenses 28,410 26,328 Depreciation and amortization 2,907 2,715 Operating income (loss) 11,532 (3,601 ) Equity in income of unconsolidated entities 319 36 Other expense, net (15,757 ) (15,627 ) Loss from continuing operations before income (3,906 ) (19,192 ) taxes Provision for (benefit from) income taxes 42 (253 ) Loss from continuing operations (3,948 ) (18,939 ) Loss from discontinued operations, net of tax (1,190 ) (1,449 ) Net loss $ (5,138 ) $ (20,388 ) Weighted average number of shares: Basic and Diluted 25,009 24,294 Basic and Diluted loss per share: Continuing Operations $ (0.16 ) $ (0.78 ) Discontinued Operations $ (0.05 ) $ (0.06 ) Total $ (0.21 ) $ (0.84 ) Three Months Ended December 31, 2013 2012 Capitalized interest in inventory, beginning of $ 52,562 $ 38,190 period Interest incurred 32,441 28,418 Interest expense not qualified for (16,032 ) (16,211 ) capitalization and included as other expense Capitalized interest amortized to house (7,135 ) (8,475 ) construction and land sales expenses Capitalized interest in inventory, end of period $ 61,836 $ 41,922 BEAZER HOMES USA, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS ($ in thousands, except share and per share data) December 31, 2013 September 30, 2013 ASSETS Cash and cash equivalents $ 382,560 $ 504,459 Restricted cash 49,155 48,978 Accounts receivable (net of allowance of $1,495 and $1,651, 21,074 22,342 respectively) Income tax receivable 2,813 2,813 Inventory Owned inventory 1,374,987 1,304,694 Land not owned under option 7,751 9,124 agreements Total inventory 1,382,738 1,313,818 Investments in unconsolidated 47,424 44,997 entities Deferred tax assets, net 5,333 5,253 Property, plant and equipment, net 17,437 17,000 Other assets 24,299 27,129 Total assets $ 1,932,833 $ 1,986,789 LIABILITIES AND STOCKHOLDERS’ EQUITY Trade accounts payable $ 60,505 $ 83,800 Other liabilities 117,318 145,623 Obligations related to land not 3,147 4,633 owned under option agreements Total debt (net of discounts of 1,516,255 1,512,183 $4,970 and $5,160 respectively) Total liabilities $ 1,697,225 $ 1,746,239 Stockholders’ equity: Preferred stock (par value $.01 per share, 5,000,000 shares authorized, $ — $ — no shares issued) Common stock (par value $0.001 per share, 63,000,000 shares authorized, 25,358,835 and 25 25 25,245,945 issued and outstanding, respectively) Paid-in capital 846,361 846,165 Accumulated deficit (610,778 ) (605,640 ) Total stockholders’ equity 235,608 240,550 Total liabilities and stockholders’ $ 1,932,833 $ 1,986,789 equity Inventory Breakdown Homes under construction $ 260,359 $ 262,476 Development projects in progress 611,736 578,453 Land held for future development 338,512 341,986 Land held for sale 59,924 31,331 Capitalized interest 61,836 52,562 Model homes 42,620 37,886 Land not owned under option 7,751 9,124 agreements Total inventory $ 1,382,738 $ 1,313,818 BEAZER HOMES USA, INC. CONSOLIDATED OPERATING AND FINANCIAL DATA – CONTINUING OPERATIONS ($ in thousands, except otherwise noted) Quarter Ended December 31, SELECTED OPERATING DATA 2013 2012 Closings: West region 435 499 East region 338 353 Southeast region 265 186 Total closings 1,038 1,038 New orders, net of cancellations: West region 351 424 East region 308 309 Southeast region 236 199 Total new orders 895 932 Backlog units at end of period: West region 654 764 East region 631 703 Southeast region 465 350 Total backlog units 1,750 1,817 Dollar value of backlog at end of period (in $ 500.0 $ 478.3 millions) Homebuilding Revenue: West region $ 120,212 $ 109,753 East region 106,879 96,464 Southeast region 62,867 38,208 Total homebuilding revenue $ 289,958 $ 244,425 Quarter Ended December 31, SUPPLEMENTAL FINANCIAL DATA 2013 2012 Revenues: Homebuilding $ 289,958 $ 244,425 Land sales and other 3,212 2,477 Total $ 293,170 $ 246,902 Gross profit: Homebuilding $ 54,450 $ 35,630 Land sales and other 220 454 Total $ 54,670 $ 36,084 Reconciliation of homebuilding gross profit before impairments and abandonments and interest amortized to cost of sales and the related gross margins to homebuilding gross profit and gross margin, the most directly comparable GAAP measure, is provided for each period discussed below. Management believes that this information assists investors in comparing the operating characteristics of homebuilding activities by eliminating many of the differences in companies' respective level of impairments and level of debt. Quarter Ended December 31, 2013 2012 Homebuilding gross profit $ 54,450 18.8 % $ 35,630 14.6 % Inventory impairments and lot 31 204 option abandonments (I&A) Homebuilding gross profit before 54,481 18.8 % 35,834 14.7 % I&A Interest amortized to cost of 7,135 8,475 sales Homebuilding gross profit before I&A and interest amortized to $ 61,616 21.2 % $ 44,309 18.1 % cost of sales Reconciliation of Adjusted EBITDA (earnings before interest, taxes, depreciation, amortization, debt extinguishment, impairments and abandonments) to total company net loss (including discontinued operations), the most directly comparable GAAP measure, is provided for each period discussed below. Management believes that Adjusted EBITDA assists investors in understanding and comparing the operating characteristics of homebuilding activities by eliminating many of the differences in companies' respective capitalization, tax position and level of impairments. Quarter Ended December 31, 2013 2012 Net loss $ (5,138 ) $ (20,388 ) Benefit from income taxes 52 (275 ) Interest amortized to home construction and land sales expenses, capitalized interest impaired, 23,167 24,686 and interest expense not qualified for capitalization Depreciation and amortization and stock 3,516 3,499 compensation amortization Inventory impairments and option contract 31 221 abandonments Adjusted EBITDA $ 21,628 $ 7,743 Contact: Beazer Homes USA, Inc. Carey Phelps, 770-829-3700 Director, Investor Relations & Corporate Communications email@example.com
Beazer Homes Reports First Quarter Fiscal 2014 Results
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