M.D.C. Holdings Announces 2014 Second Quarter Results

            M.D.C. Holdings Announces 2014 Second Quarter Results

PR Newswire

DENVER, July 29, 2014

DENVER, July 29, 2014 /PRNewswire/ -- M.D.C. Holdings, Inc. (NYSE: MDC)
announced results for the quarter ended June 30, 2014.

2014 Second Quarter Highlights and Comparisons to 2013 Second Quarter

  oNet income of $21.5 million, or $0.44 per diluted share vs. net income of
    $224.9 million, or $4.55 per diluted share

       oTax expense of $12.5 million vs. tax benefit of $186.9 million, which
         included the reversal of a substantial portion of the deferred tax
         asset valuation allowance of $187.6 million, or $3.84 per share

  oPretax income of $34.0 million vs. $38.0 million
  oNet new orders up 5% to 1,419 homes

       oDollar value of net new orders of $544.8 million, up 12%

  oEnding backlog dollar value of $761.5 million vs. $784.2 million
  oHome sale revenues of $430.7 million, up 8% vs. $400.3 million

       oAverage sales price increase of $33,600 per home, or 10%, to $372,000
       oHomes delivered of 1,158 down slightly from 1,183

  oEnding active community count of 159, up 14% from 140
  oGross margin from home sales of 17.1% vs. 18.1%

       oGross margin excluding interest and impairments of 21.1%* vs. 21.3%*

  oSG&A expenses as a percentage of home sale revenues of 11.6% vs. 13.0%, a
    140 basis point improvement
  oLots owned and under option of 16,706, up 13% year-over-year

Our net income for the 2014 second quarter was $21.5 million, or $0.44 per
diluted share, compared to net income of $224.9 million, or $4.55 per diluted
share, for the year earlier period. Our 2013 second quarter included a $187.6
million benefit from the reversal of our deferred tax asset valuation
allowance, while we had no such benefit for the 2014 second quarter and
recognized $12.5 million of income tax expense. Pretax income for the 2014
second quarter was $34.0 million, compared to $38.0 million for the same
period in the prior year.

Larry A. Mizel, MDC's Chairman and Chief Executive Officer, stated, "For the
homebuilding industry as a whole, the spring selling season was modestly
slower than a year ago, highlighting volatile conditions in the short-term as
the industry continues down a broader path of long-term growth. We saw
hesitation from some potential buyers, especially in the first-time buyer
segment, following a significant run-up in home prices in 2013 and tepid
economic trends that have persisted for much of the past year. However, our
net new home orders improved year-over-year in the 2014 second quarter for the
first time in five quarters on the strength of a year-over-year increase in
our average active community count."

Mr. Mizel continued, "Additionally, during the quarter we benefited from our
prior decision to increase spec homes available for quick delivery, which
supported our operations by allowing us to convert backlog to deliveries at a
quicker rate than a year ago. Our increased conversion rate, coupled with a
10% increase in average selling price, helped to drive a year-over-year
increase in our home sale revenues, offsetting the impact of higher land,
material and labor costs. The higher revenues also helped us achieve better
leverage on our overhead, as our SG&A rate dropped meaningfully year-over-year
for the 2014 second quarter."

Mr. Mizel concluded, "As the second quarter ended, we saw significant
improvements in employment levels and consumer confidence, which supports our
long-term view that the homebuilding industry is poised for growth in the
coming years. We continue our preparations to embrace this growth, as
evidenced by the 14% increase in our active subdivision count, the 13%
increase in our controlled lot supply and the 20% increase in our available
liquidity to $1.1 billion at the end of the quarter, all of which position us
well to grow our earnings in future periods."

Homebuilding

Home sale revenues for the 2014 second quarter increased 8% to $430.7 million,
compared to $400.3 million for the prior year period. The increase in
revenues resulted primarily from a 10% increase in average selling price to
$372,000, as compared to $338,400 in the prior year. The increase in average
selling price was due to price increases achieved during much of 2013 and a
shift to higher-priced homes in certain markets.

Gross margin from home sales decreased to 17.1% from 18.1% for the
year-earlier period. The decrease was due primarily to higher interest costs,
cost increases from vendors and land sellers, and additional incentives
offered in certain markets to spur demand in a slower homebuilding
environment. Gross margin from home sales excluding interest and impairments
was nearly flat from the year-earlier period at 21.1%* for the second quarter
2014, compared to 21.3%* for the 2013 second quarter.

SG&A expenses as a percentage of home sales revenues decreased by 140 basis
points to 11.6% for the 2014 second quarter versus 13.0% for the same period
in 2013. The improvement was the result of operating leverage created by the
Company's 8% year-over-year increase in home sale revenues, lower incentive
and stock-based compensation expenses, and lower legal expenses, including a
$1.4 million net legal recovery.

The dollar value of net new orders for the 2014 second quarter increased 12%
to $544.8 million from the same period in 2013. The increase in net new
orders was driven by a 14% increase in active communities to 159 from 140 in
the same period in the prior year, which was partially offset by a slight
decrease in our monthly sales absorption pace. Our cancellation rate for the
2014 second quarter was essentially flat at 18% versus 19% in the prior year
second quarter.

We ended the 2014 second quarter with 1,886 homes in backlog with an estimated
sales value of $761.5 million, compared to a backlog of 2,095 homes with an
estimated sales value of $784.2 million at June 30, 2013.

Interest and other income of $4.6 million for the 2014 second quarter
decreased by $5.6 million from the same period last year primarily due to
lower interest income as overall cash and investment balances decreased to
fund an increase in our investment in real estate inventories.

Financial Services

Income before taxes from our financial services operations for the 2014 second
quarter was $6.6 million, compared to $8.2 million for the 2013 second
quarter. The decrease was primarily driven by lower pretax income from our
mortgage operations segment for both periods due to reduced volumes,
origination income per unit and gains on loans locked and sold compared to a
year ago resulting primarily from a more competitive mortgage market.

Income Taxes

During the 2014 second quarter, we recognized $12.5 million of income tax
expense resulting in an effective tax rate of 36.7%. For the 2013 second
quarter, we recognized a $186.9 million income tax benefit, driven almost
entirely by our reversal of a substantial portion of our deferred tax asset
valuation allowance.

About MDC

Since 1972, MDC's subsidiary companies have built and financed the American
dream for more than 175,000 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 Diego, Orange
County, San Francisco Bay Area, Sacramento, Washington D.C., Baltimore,
Philadelphia, Orlando, Jacksonville, South Florida 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 June 30, 2014, 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          Six Months Ended
                        June 30,                    June 30,
                        2014          2013          2014          2013
                        (Dollars in thousands, except per share amounts)
                        (Unaudited)
Homebuilding:
Home sale revenues      $ 430,743     $ 400,327     $ 749,277     $ 732,075
Land sale revenues        518           1,807         518           1,807
Total home and land       431,261       402,134       749,795       733,882
sale revenues
Home cost of sales        (356,175)     (327,927)     (615,653)     (602,003)
Land cost of sales        (522)         (1,435)       (522)         (1,435)
Inventory impairments     (850)         -             (850)         -
Total cost of sales       (357,547)     (329,362)     (617,025)     (603,438)
Gross margin              73,714        72,772        132,770       130,444
Selling, general and      (49,798)      (51,908)      (98,140)      (100,109)
administrative expenses
Interest and other        4,613         10,200        18,162        16,749
income
Interest expense          -             (909)         (685)         (1,726)
Other expense             (1,080)       (366)         (1,693)       (722)
Loss on early             -             -             (9,412)       -
extinguishment of debt
Homebuilding pretax       27,449        29,789        41,002        44,636
income
Financial Services:
Revenues                  11,491        13,884        20,714        26,390
Expenses                  (5,615)       (6,581)       (10,539)      (12,223)
Interest and other        701           920           1,489         1,795
income
Financial services        6,577         8,223         11,664        15,962
pretax income
Income before income      34,026        38,012        52,666        60,598
taxes
Benefit from (provision   (12,484)      186,897       (19,620)      186,827
for) income taxes
Net income              $ 21,542      $ 224,909     $ 33,046      $ 247,425
Other comprehensive
income (loss) related
to available for sale     2,327         (1,995)       (1,719)       540
securities, net of tax
Comprehensive income    $ 23,869      $ 222,914     $ 31,327      $ 247,965
Earnings per share:
Basic                   $ 0.44        $ 4.60        $ 0.68        $ 5.06
Diluted                 $ 0.44        $ 4.55        $ 0.67        $ 5.01
Weighted average common
shares outstanding
Basic                     48,640,979    48,478,076    48,613,521    48,410,486
Diluted                   48,852,696    48,946,055    48,842,527    48,916,988
Dividends declared per  $ 0.25        $ -           $ 0.50        $ -
share





M.D.C. HOLDINGS, INC.

Consolidated Balance Sheets
                                                 June 30,        December 31,
                                                 2014            2013
ASSETS                                           (Dollars in thousands, except
                                                 per share amounts)
Homebuilding:                                    (Unaudited)
Cash and cash equivalents                        $  100,150      $   148,634
Marketable securities                               492,498          569,021
Restricted cash                                     2,188            2,195
Trade and other receivables                         27,250           23,407
Inventories:
Housing completed or under construction             758,392          636,700
Land and land under development                     837,889          774,961
Total inventories                                   1,596,281        1,411,661
Property and equipment, net                         30,765           31,248
Deferred tax asset, net                            160,872          176,262
Metropolitan district bond securities (related      14,291           12,729
party)
Prepaid and other assets                            65,374           53,525
Total homebuilding assets                           2,489,669        2,428,682
Financial Services:
Cash and cash equivalents                           29,881           50,704
Marketable securities                               13,390           19,046
Mortgage loans held-for-sale, net                   58,377           92,578
Other assets                                        5,244            4,439
Total financial services assets                     106,892          166,767
 Total Assets                               $  2,596,561    $   2,595,449
LIABILITIES AND EQUITY
Homebuilding:
Accounts payable                                 $  34,266       $   15,046
Accrued liabilities                                 145,290          152,821
Revolving credit facility                           10,000           -
Senior notes, net                                   1,096,112        1,095,620
Total homebuilding liabilities                      1,285,668        1,263,487
Financial Services:
Accounts payable and accrued liabilities            56,086           55,639
Mortgage repurchase facility                        32,198           63,074
Total financial services liabilities                88,284           118,713
 Total Liabilities                             1,373,952        1,382,200
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; 48,816,639 and 48,788,887
issued and outstanding at June 30, 2014 and         488              488
December 31, 2013, respectively
Additional paid-in-capital                          910,535          908,090
Retained earnings                                   301,730          293,096
Accumulated other comprehensive income              9,856            11,575
Total Stockholders' Equity                          1,222,609        1,213,249
Total Liabilities and Stockholders' Equity       $  2,596,561    $   2,595,449





M.D.C. HOLDINGS, INC.

Consolidated Statement of Cash Flows
                             Three Months Ended       Six Months Ended
                             June 30,                 June 30,
                             2014        2013         2014         2013
                             (Dollars in thousands)
                             (Unaudited)
Operating Activities:
Net income                   $ 21,542    $ 224,909    $ 33,046     $ 247,425
Adjustments to reconcile net
income to net cash provided
by (used in) operating
activities:
Loss on early extinguishment   -           -            9,412        -
of debt
Stock-based compensation       1,258       1,838        2,550        5,214
expense
Depreciation and               999         994          1,933        2,072
amortization
Loss (gain) on sale of         549         -            (6,356)      -
marketable securities
Amortization of discount /
premiums on marketable debt    512         804          422          1,423
securities
Deferred income tax expense    12,451      (187,643)    19,554       (187,643)
(benefit)
Net changes in assets and
liabilities:
 Restricted cash          (683)       (153)        7            (820)
 Trade and other          302         (4,596)      (8,409)      (8,566)
receivables
 Mortgage loans           6,423       (6,034)      34,201       27,490
held-for-sale
 Housing completed or     (47,178)    (47,469)     (122,368)    (56,087)
under construction
 Land and land under      972         (93,739)     (62,746)     (138,509)
development
 Prepaid expenses and     (2,734)     (1,414)      (9,615)      (7,884)
other assets
 Accounts payable and     30,468      21,678       12,097       (30,358)
accrued liabilities
Net cash provided by (used     24,881      (90,825)     (96,272)     (146,243)
in) operating activities
Investing Activities:
Purchases of marketable        (25,992)    (161,284)    (382,279)    (312,095)
securities
Maturities of marketable       26,065      87,015       159,789      87,015
securities
Sales of marketable            20,414      92,399       306,769      137,067
securities
Purchases of property and      (809)       (72)         (1,354)      (998)
equipment
Net cash provided by (used     19,678      18,058       82,925       (89,011)
in) investing activities
Financing Activities:
Payments on mortgage           (7,142)     7,380        (30,876)     (27,479)
repurchase facility, net
Proceeds from issuance of      -           99,125       248,375      346,938
senior notes
Repayment of senior notes      -           -            (259,118)    -
Advances on revolving credit   10,000      -            10,000       -
facility, net
Dividend payments              (12,205)    -            (24,412)     -
Proceeds from exercise of      -           -            71           5,118
stock options
Net cash provided by (used     (9,347)     106,505      (55,960)     324,577
in) financing activities
Net increase (decrease) in     35,212      33,738       (69,307)     89,323
cash and cash equivalents
Cash and cash equivalents:
 Beginning of period      94,819      215,680      199,338      160,095
 End of period          $ 130,031   $ 249,418    $ 130,031    $ 249,418





M.D.C. HOLDINGS, INC.

Homebuilding Operational Data
New Home Deliveries
            Three Months Ended June 30,
            2014                       2013                       % Change
                   Dollar     Average         Dollar     Average         Dollar  Average
            Homes             Price    Homes             Price    Homes          Price
                   Value                      Value                      Value
            (Dollars in thousands)
 Arizona    184    $ 47,413   $ 257.7  130    $ 30,472   $ 234.4  42%    56%     10%
 California 143      70,898     495.8  167      61,199     366.5  (14)%  16%     35%
 Nevada     144      42,782     297.1  161      41,850     259.9  (11)%  2%      14%
 Washington 78       28,568     366.3  98       30,992     316.2  (20)%  (8)%    16%
 West       549      189,661    345.5  556      164,513    295.9  (1)%   15%     17%
 Colorado   328      132,004    402.5  309      113,320    366.7  6%     16%     10%
 Utah       44       14,143     321.4  59       18,643     316.0  (25)%  (24)%   2%
 Mountain   372      146,147    392.9  368      131,963    358.6  1%     11%     10%
 Maryland   81       36,351     448.8  83       35,407     426.6  (2)%   3%      5%
 Virginia   67       35,023     522.7  95       47,350     498.4  (29)%  (26)%   5%
 Florida    89       23,561     264.7  81       21,094     260.4  10%    12%     2%
 East       237      94,935     400.6  259      103,851    401.0  (8)%   (9)%    (0)%
 Total      1,158  $ 430,743  $ 372.0  1,183  $ 400,327  $ 338.4  (2)%   8%      10%

            Six Months Ended June 30,
            2014                       2013                       % Change
                   Dollar     Average         Dollar     Average         Dollar  Average
            Homes             Price    Homes             Price    Homes  Value   Price
                   Value                      Value
            (Dollars in thousands)
 Arizona    309    $ 80,085   $ 259.2  270    $ 63,633   $ 235.7  14%    26%     10%
 California 235      111,998    476.6  313      110,788    354.0  (25)%  1%      35%
 Nevada     264      82,719     313.3  294      74,595     253.7  (10)%  11%     23%
 Washington 142      51,281     361.1  159      50,476     317.5  (11)%  2%      14%
 West       950      326,083    343.2  1,036    299,492    289.1  (8)%   9%      19%
 Colorado   576      225,387    391.3  613      226,808    370.0  (6)%   (1)%    6%
 Utah       68       21,705     319.2  126      38,532     305.8  (46)%  (44)%   4%
 Mountain   644      247,092    383.7  739      265,340    359.1  (13)%  (7)%    7%
 Maryland   158      73,256     463.6  137      57,111     416.9  15%    28%     11%
 Virginia   124      62,290     502.3  158      76,469     484.0  (22)%  (19)%   4%
 Florida    155      40,556     261.7  131      33,663     257.0  18%    20%     2%
 East       437      176,102    403.0  426      167,243    392.6  3%     5%      3%
 Total      2,031  $ 749,277  $ 368.9  2,201  $ 732,075  $ 332.6  (8)%   2%      11%





M.D.C. HOLDINGS, INC.

Homebuilding Operational Data
Net New Orders:
           Three Months Ended June 30,
           2014                                   2013                                   % Change
                                      Monthly                                Monthly                             Monthly
                  Dollar     Average                     Dollar     Average                     Dollar  Average
           Homes             Price    Absorption  Homes  Value      Price    Absorption  Homes  Value   Price    Absorption
                  Value
                                      Rate *                                 Rate *                              Rate *
           (Dollars in thousands)
Arizona    262    $ 74,051   $ 282.6  2.65        196    $ 48,825   $ 249.1  3.84        34%    52%     13%      (31)%
California 214      101,695    475.2  4.14        196      79,196     404.1  5.23        9%     28%     18%      (21)%
Nevada     180      57,456     319.2  3.75        152      49,085     322.9  4.94        18%    17%     (1)%     (24)%
Washington 74       27,960     377.8  2.67        94       31,016     330.0  2.72        (21)%  (10)%   14%      (2)%
West       730      261,162    357.8  3.22        638      208,122    326.2  4.15        14%    25%     10%      (22)%
Colorado   410      171,001    417.1  3.67        381      143,754    377.3  3.30        8%     19%     11%      11%
Utah       55       17,517     318.5  3.06        44       14,582     331.4  2.10        25%    20%     (4)%     46%
Mountain   465      188,518    405.4  3.58        425      158,336    372.6  3.11        9%     19%     9%       15%
Maryland   77       37,877     491.9  1.71        112      53,091     474.0  1.84        (31)%  (29)%   4%       (7)%
Virginia   64       31,305     489.1  2.59        90       43,830     487.0  2.50        (29)%  (29)%   0%       4%
Florida    83       25,966     312.8  1.78        86       22,080     256.7  2.25        (3)%   18%     22%      (21)%
East       224      95,148     424.8  1.93        288      119,001    413.2  2.13        (22)%  (20)%   3%       (9)%
Total      1,419  $ 544,828  $ 384.0  3.00        1,351  $ 485,459  $ 359.3  3.18        5%     12%     7%       (6)%

           Six Months Ended June 30,
           2014                                     2013                                   % Change
                  Dollar       Average  Monthly            Dollar     Average  Monthly            Dollar  Average  Monthly
           Homes  Value        Price    Absorption  Homes  Value      Price    Absorption  Homes  Value   Price    Absorption
                                        Rate *                                 Rate *                              Rate
           (Dollars in thousands)
Arizona    453    $ 127,560    $ 281.6  2.50        323    $ 79,760   $ 246.9  3.36        40%    60%     14%      (26)%
California 367      178,119      485.3  4.12        360      140,358    389.9  4.77        2%     27%     24%      (14)%
Nevada     330      102,618      311.0  3.50        322      95,267     295.9  4.94        2%     8%      5%       (29)%
Washington 166      62,212       374.8  2.69        187      59,942     320.5  2.91        (11)%  4%      17%      (8)%
West       1,316    470,509      357.5  3.09        1,192    375,327    314.9  3.96        10%    25%     14%      (22)%
Colorado   806      333,920      414.3  3.60        799      291,343    364.6  3.40        1%     15%     14%      6%
Utah       98       32,219       328.8  2.86        109      35,179     322.7  1.99        (10)%  (8)%    2%       44%
Mountain   904      366,139      405.0  3.50        908      326,522    359.6  3.13        (0)%   12%     13%      12%
Maryland   145      69,515       479.4  1.51        202      91,526     453.1  1.76        (28)%  (24)%   6%       (14)%
Virginia   123      61,485       499.9  2.21        183      92,714     506.6  2.51        (33)%  (34)%   (1)%     (12)%
Florida    167      52,490       314.3  1.97        166      42,626     256.8  2.11        1%     23%     22%      (7)%
East       435      183,490      421.8  1.84        551      226,866    411.7  2.07        (21)%  (19)%   2%       (11)%
Total      2,655  $ 1,020,138  $ 384.2  2.88        2,651  $ 928,715  $ 350.3  3.09        0%     10%     10%      (7)%

* Calculated as total net new orders in period ÷ average active communities
during period ÷ number of months in period



M.D.C. HOLDINGS, INC.

Homebuilding Operational Data
Active Subdivisions
                                  June 30,    %
                                  2014  2013  Change
 Arizona                          34    19    79%
 California                       20    11    82%
 Nevada                           16    13    23%
 Washington                       8     12    (33)%
 West                             78    55    42%
 Colorado                         36    38    (5)%
 Utah                             6     4     50%
 Mountain                         42    42    0%
 Maryland                         14    20    (30)%
 Virginia                         8     11    (27)%
 Florida                          17    12    42%
 East                             39    43    (9)%
 Total                            159   140   14%
 Average for quarter ended        158   142   11%
 Average for the six months ended 153   143   7%



Backlog
            June 30,
            2014                       2013                       % Change
                   Dollar     Average         Dollar     Average         Dollar  Average
            Homes             Price    Homes             Price    Homes          Price
                   Value                      Value                      Value
            (Dollars in thousands)
 Arizona    304    $ 90,028   $ 296.1  203    $ 50,836   $ 250.4  50%    77%     18%
 California 279      135,197    484.6  276      107,950    391.1  1%     25%     24%
 Nevada     206      66,713     323.8  232      71,488     308.1  (11)%  (7)%    5%
 Washington 70       26,127     373.2  107      36,118     337.6  (35)%  (28)%   11%
 West       859      318,065    370.3  818      266,392    325.7  5%     19%     14%
 Colorado   647      278,643    430.7  656      246,797    376.2  (1)%   13%     14%
 Utah       56       18,583     331.8  64       21,576     337.1  (13)%  (14)%   (2)%
 Mountain   703      297,226    422.8  720      268,373    372.7  (2)%   11%     13%
 Maryland   116      58,674     505.8  248      113,824    459.0  (53)%  (48)%   10%
 Virginia   102      49,381     484.1  210      109,180    519.9  (51)%  (55)%   (7)%
 Florida    106      38,120     359.6  99       26,470     267.4  7%     44%     34%
 East       324      146,175    451.2  557      249,474    447.9  (42)%  (41)%   1%
 Total      1,886  $ 761,466  $ 403.7  2,095  $ 784,239  $ 374.3  (10)%  (3)%    8%



M.D.C. HOLDINGS, INC.

Homebuilding Operational Data
Homes Completed or Under Construction (WIP lots)
                                             June 30,      %
                                             2014   2013   Change
 Unsold:
 Completed                                   419    185    126%
 Under construction                          725    628    15%
 Total unsold started homes                  1,144  813    41%
 Sold homes under construction or completed  1,422  1,652  (14)%
 Model homes                                 263    207    27%
 Total homes completed or under construction 2,829  2,672  6%



Lots Owned and Options (including homes completed or under construction)
            June 30, 2014             June 30, 2013
            Lots    Lots      Total   Lots    Lots      Total   Total %
            Owned   Optioned          Owned   Optioned          Change
 Arizona    2,683   50        2,733   2,707   239       2,946   (7)%
 California 1,655   132       1,787   971     -         971     84%
 Nevada     1,534   434       1,968   1,573   136       1,709   15%
 Washington 756     226       982     477     141       618     59%
 West       6,628   842       7,470   5,728   516       6,244   20%
 Colorado   4,439   983       5,422   4,174   1,079     5,253   3%
 Utah       553     163       716     468     -         468     53%
 Mountain   4,992   1,146     6,138   4,642   1,079     5,721   7%
 Maryland   409     434       843     551     358       909     (7)%
 Virginia   569     499       1,068   491     284       775     38%
 Florida    803     384       1,187   648     424       1,072   11%
 East       1,781   1,317     3,098   1,690   1,066     2,756   12%
 Total      13,401  3,305     16,706  12,060  2,661     14,721  13%



M.D.C. HOLDINGS, INC.
Reconciliations of Non-GAAP Financial Measures
Gross Margin from Homes Sales Excluding Interest and Impairments (Unaudited)
Gross Margin from Home Sales Excluding Interest and Impairments is a non-GAAP
financial measures. We believe this information is meaningful as it isolates
the impact that interest and impairments have on our Gross Margin from Home
Sales and permits investors to make better comparisons with our competitors,
who also break out and adjust gross margins in a similar fashion.



            Three Months Ended June 30,          Six Months Ended June 30,
                      Gross              Gross              Gross              Gross
            2014      Margin  2013       Margin  2014       Margin  2013       Margin
                      %                  %                  %                  %
              (Dollars in thousands)
Gross       $ 73,714  17.1%   $ 72,772   18.1%   $ 132,770  17.7%   $ 130,444  17.8%
Margin
Less: Land
Sales         (518)             (1,807)            (518)              (1,807)
Revenue
Add: Land
Cost of       522               1,435              522                1,435
Sales
Gross
Margin from   73,718  17.1%     72,400   18.1%     132,774  17.7%     130,072  17.8%
Home Sales
Add:
Inventory     850               -                  850                -
Impairments
Gross
Margin from
Home Sales
Excluding     74,568  17.3%     72,400   18.1%     133,624  17.8%     130,072  17.8%
Impairments
Add:
Interest in   16,522            12,680             28,246             22,554
Cost of
Sales
Gross
Margin from
Home Sales
Excluding
Impairments $ 91,090  21.1%   $ 85,080   21.3%   $ 161,870  21.6%   $ 152,626  20.8%
and
Interest



SOURCE M.D.C. Holdings, Inc.

Website: http://www.mdcholdings.com
Contact: Robert N. Martin, Vice President of Finance and Corporate Controller,
1-866-424-3395 / (720) 977-3395, IR@mdch.com
 
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