Beazer Homes Reports Third Quarter Fiscal 2014 Results Including $6.6 Million Income from Continuing Operations Before Loss on

  Beazer Homes Reports Third Quarter Fiscal 2014 Results Including $6.6   Million Income from Continuing Operations Before Loss on Debt Extinguishment    *22.7% Homebuilding Gross Margins   *Affirms Expectation of Net Income for Fiscal 2014  Business Wire  ATLANTA -- July 31, 2014  Beazer Homes USA, Inc. (NYSE: BZH) (www.beazer.com) today announced its financial results for the quarter and nine months ended June30, 2014.  “For the third quarter, we recorded strong gross margins, higher average sales prices and  a sales absorption rate that was among the highest in our peer group,” said Allan Merrill, CEO of Beazer Homes. “This led to a substantial improvement in Adjusted EBITDA and enabled us to report income from homebuilding operations in our third quarter for the first time in nearly a decade. We believe our improved operational and financial results will allow us to report a full year of profitability for fiscal 2014 and further growth in the years ahead.”  The Company reported $6.6 million in income from continuing operations, excluding a $19.8 million loss on the extinguishment of debt related to the Company’s successful refinancing transaction in April. At that time, the Company refinanced its 9.125% Senior Notes due 2018 with 5.75% Senior Notes due 2019, thereby reducing its annual interest expense obligations by approximately $8 million. Including the debt extinguishment, the Company reported a net loss from continuing operations of $13.2 million for the third quarter.  Subsequent Events  On July 1, 2014, the Company received common stock in American Homes 4 Rent (AMH), a publicly traded real estate investment trust in exchange for its investment in Beazer Pre-Owned Rental Homes, LLC. The Company expects to record a gain on the transaction of approximately $6 million during our fourth quarter of fiscal 2014.  In July 2014, we settled an appeal with the Internal Revenue Service related to prior year tax returns. As a result, the Company expects to receive approximately $26 million in cash during the quarter ended September 30, 2014. This will be recorded as a tax benefit during the Company’s fiscal fourth quarter.  Summary results for the quarter and nine months ended June30, 2014 are as follows:  Q3 Results from Continuing Operations (unless otherwise specified)                                                                               Quarter Ended June 30,                                         2014        2013        Change New Home Orders                         1,290         1,381         (6.6    )% Orders per month per community          3.1           3.2           (3.1    )% Actual community count at month-end     142           144           (1.4    )% Average active community count          140           144           (2.8    )% Cancellation rates                      21.0    %     20.0    %     100 bps                                                                              Total Home Closings                     1,241         1,234         0.6     % Average sales price from closings       $ 284.6       $ 253.8       12.1    % (in thousands) Homebuilding revenue (in millions)      $ 353.2       $ 313.1       12.8    % Homebuilding gross profit margin, excluding impairments and               20.0    %     17.1    %     290 bps abandonments (I&A) Homebuilding gross profit margin, excluding I&A and interest              22.7    %     20.3    %     240 bps amortized to cost of sales                                                                              Income (loss) from continuing operations before loss on debt          $ 6.6         $ (5.4  )     $ 12.0 extinguishment (in millions) Loss on debt extinguishment (in         $ (19.8 )     $ —           $ (19.8 ) millions) Loss from continuing operations (in     $ (13.2 )     $ (5.4  )     $ (7.8  ) millions) Basic Loss Per Share                    $ (0.50 )     $ (0.22 )     $ (0.28 )                                                                              Land and land development spending      $ 129.1       $ 161.8       $ (32.7 ) (in millions) Total Company Adjusted EBITDA (in       $ 31.6        $ 21.8        $ 9.8 millions)                                                                                                                                                                                                   Nine Months Ended June 30,                                         2014          2013          Change New Home Orders                         3,575         3,834         (6.8    )% LTM orders per month per community      2.9           2.7           7.4     % Cancellation rates                      20.6    %     21.1    %     -50 bps                                                                              Total Home Closings                     3,256         3,399         (4.2    )% Average sales price from closings       $ 279.3       $ 248.0       12.6    % (in thousands) Homebuilding revenue (in millions)      $ 909.2       $ 843.0       7.9     % Homebuilding gross profit margin, excluding impairments and               19.5    %     16.0    %     350 bps abandonments (I&A) Homebuilding gross profit margin, excluding I&A and interest              22.2    %     19.3    %     290 bps amortized to cost of sales                                                                              Loss from continuing operations before loss on debt extinguishment      $ (5.5  )     $ (39.9 )     $ 34.4 (in millions) Loss on debt extinguishment (in         $ (19.9 )     $ (3.6  )     $ (16.3 ) millions) Net loss from continuing operations     $ (25.4 )     $ (43.5 )     $ 18.1 (in millions) Basic Loss Per Share                    $ (0.99 )     $ (1.77 )     $ 0.78                                                                              Land and land development spending      $ 381.5       $ 314.4       $ 67.1 (in millions) Total Company Adjusted EBITDA (in       $ 71.8        $ 44.7        $ 27.1 millions)                                                                               As of June 30, 2014    *Total cash and cash equivalents: $264.4 million, including unrestricted     cash of approximately $206.5 million   *Stockholders' equity: $219.0 million   *Total backlog from continuing operations: 2,212 homes with a sales value     of $663.2 million, compared to 2,358 homes with a sales value of $646.1     million as of June30, 2013   *Land and lots controlled: 29,783 lots (79.4% owned), an increase of 10.4%     from June30, 2013  Conference Call  The Company will hold a conference call on July 31, 2014 at 10:00 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 888-296-6948 or 203-369-3028 and enter the passcode “3740” (available until 10:59 pm ET on August 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 Choice Plans 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.                                 -Tables Follow-  BEAZER HOMES USA, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ($ in thousands, except per share data)                                                                                        Three Months Ended          Nine Months Ended                          June 30,                    June 30,                          2014          2013          2014          2013 Total revenue            $ 354,671     $ 314,439     $ 917,862     $ 849,243 Home construction and land sales           283,857       260,324       739,295       712,930 expenses Inventory impairments and          2,010        —            2,921        2,229      option contract abandonments Gross profit             68,804        54,115        175,646       134,084 Commissions              14,322        13,078        37,239        35,406 General and administrative           35,994        29,612        97,032        84,735 expenses Depreciation and         3,400        2,953        9,138        8,761      amortization Operating income         15,088        8,472         32,237        5,182 Equity in (loss) income of                (81       )   (310      )   221           (206      ) unconsolidated entities Loss on extinguishment of        (19,764   )   —             (19,917   )   (3,638    ) debt Other expense, net       (10,205   )   (14,036   )   (39,689   )   (45,858   ) Loss from continuing operations before        (14,962   )   (5,874    )   (27,148   )   (44,520   ) income taxes Benefit from income      (1,769    )   (432      )   (1,783    )   (1,028    ) taxes Loss from continuing     (13,193   )   (5,442    )   (25,365   )   (43,492   ) operations Income (loss) from discontinued             838          (346      )   (99       )   (2,324    ) operations, net of tax Net loss                 $ (12,355 )   $ (5,788  )   $ (25,464 )   $ (45,816 ) Weighted average number of shares: Basic and Diluted        26,421        24,770        25,582        24,571 Basic and Diluted (loss) income per share: Continuing               $ (0.50   )   $ (0.22   )   $ (0.99   )   $ (1.77   ) Operations Discontinued             $ 0.03        $ (0.01   )   $ (0.01   )   $ (0.09   ) Operations Total                    $ (0.47   )   $ (0.23   )   $ (1.00   )   $ (1.86   )                                                                                                          Three Months Ended        Nine Months Ended                            June 30,                  June 30,                            2014        2013           2014        2013 Capitalized interest in inventory, beginning of    $ 72,256     $ 45,501       $ 52,562     $ 38,190 period Interest incurred          31,678       28,766         96,577       86,361 Interest expense not qualified for capitalization and         (10,421  )   (14,252  )     (41,112  )   (46,709  ) included as other expense Capitalized interest amortized to house         (9,430   )   (9,996   )     (23,944  )   (27,823  ) construction and land sales expenses Capitalized interest in    $ 84,083    $ 50,019      $ 84,083    $ 50,019  inventory, end of period                                                                                BEAZER HOMES USA, INC. UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS ($ in thousands, except share and per share data)                                                                                                       June 30, 2014   September 30, 2013 ASSETS Cash and cash equivalents                   $ 206,482       $   504,459 Restricted cash                             57,963          48,978 Accounts receivable (net of allowance of    28,999          22,342 $1,278 and $1,651, respectively) Income tax receivable                       4,754           2,813 Inventory Owned inventory                             1,587,954       1,304,694 Land not owned under option agreements      7,588          9,124            Total inventory                             1,595,542       1,313,818 Investments in unconsolidated entities      34,224          44,997 Deferred tax assets, net                    5,480           5,253 Property, plant and equipment, net          17,183          17,000 Other assets                                26,767         27,129           Total assets                                $ 1,977,394    $   1,986,789                                                                                 LIABILITIES AND STOCKHOLDERS’ EQUITY Trade accounts payable                      $ 84,435        $   83,800 Other liabilities                           133,698         145,623 Obligations related to land not owned       3,016           4,633 under option agreements Total debt (net of discounts of $4,590      1,537,242      1,512,183        and $5,160 respectively) Total liabilities                           $ 1,758,391    $   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, 26,768,714    27              25 and 25,245,945 issued and outstanding, respectively) Paid-in capital                             850,080         846,165 Accumulated deficit                         (631,104    )   (605,640        ) Total stockholders’ equity                  219,003        240,550          Total liabilities and stockholders’         $ 1,977,394    $   1,986,789    equity                                                                              Inventory Breakdown Homes under construction                    $ 384,795       $   262,476 Development projects in progress            690,557         578,453 Land held for future development            309,516         341,986 Land held for sale                          74,365          31,331 Capitalized interest                        84,083          52,562 Model homes                                 44,638          37,886 Land not owned under option agreements      7,588          9,124            Total inventory                             $ 1,595,542    $   1,313,818                                                                                  BEAZER HOMES USA, INC. CONSOLIDATED OPERATING AND FINANCIAL DATA– CONTINUING OPERATIONS ($ in thousands, except otherwise noted)                                                                                      Quarter Ended June 30,        Nine Months Ended June 30, SELECTED              2014          2013            2014             2013 OPERATING DATA Closings: West region           514           550             1,402            1,553 East region           383           370             978              1,106 Southeast region      344          314            876             740 Total closings        1,241        1,234          3,256           3,399                                                                       New orders, net of cancellations: West region           486           614             1,387            1,696 East region           418           389             1,150            1,140 Southeast region      386          378            1,038           998 Total new orders      1,290        1,381          3,575           3,834                                                                       Backlog units at end of period: West region           723           982             723              982 East region           833           781             833              781 Southeast region      656          595            656             595 Total backlog         2,212        2,358          2,212           2,358 units                                                                       Dollar value of backlog at end of     $ 663.2      $ 646.1        $  663.2        $ 646.1 period (in millions)                                                                       Homebuilding Revenue: West region           $ 136,775     $ 132,803       $  376,031       $ 360,052 East region           127,147       111,333         316,392          324,334 Southeast region      89,243       68,993         216,825         158,639 Total homebuilding          $ 353,165    $ 313,129      $  909,248      $ 843,025 revenue                                                                                              Quarter Ended June 30,      Nine Months Ended June 30, SUPPLEMENTAL          2014         2013            2014            2013 FINANCIAL DATA Revenues: Homebuilding          $ 353,165     $ 313,129       $  909,248       $ 843,025 Land sales and        1,506        1,310          8,614           6,218 other Total                 $ 354,671    $ 314,439      $  917,862      $ 849,243                                                                       Gross profit: Homebuilding          $ 68,672      $ 53,588        $  174,777       $ 132,471 Land sales and        132          527            869             1,613 other Total                 $ 68,804     $ 54,115       $  175,646      $ 134,084                                                                          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 June 30,                  Nine Months Ended June 30,                  2014               2013                  2014                2013 Homebuilding     $ 68,672  19.4 %   $ 53,588  17.1 %     $ 174,777  19.2 %   $ 132,471  15.7 % gross profit Inventory impairments and lot          2,010              —                    2,921               2,229      option abandonments (I&A) Homebuilding gross profit     70,682     20.0 %   53,588     17.1 %     177,698     19.5 %   134,700     16.0 % before I&A Interest amortized to     9,430              9,996                23,944              27,823     cost of sales Homebuilding gross profit before I&A and interest     $ 80,112  22.7 %   $ 63,584  20.3 %     $ 201,642  22.2 %   $ 162,523  19.3 % amortized to 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 June 30,    Nine Months Ended June 30,                          2014         2013         2014          2013 Net loss                 $ (12,355 )   $ (5,788 )   $  (25,464 )   $ (45,816 ) Benefit from income      (1,661    )   (470     )   (1,665     )   (1,097    ) taxes Interest amortized to home construction and land sales expenses, capitalized interest     19,851        24,248       65,056         74,532 impaired, and interest expense not qualified for capitalization Depreciation and amortization and stock   4,013         3,590        11,017         11,036 compensation amortization Inventory impairments and option contract      2,010         —            2,921          2,246 abandonments Loss on debt             19,764        —            19,917         3,638 extinguishment Joint venture impairment and           —            181         —             181        abandonment charges Adjusted EBITDA          $ 31,622     $ 21,761    $  71,782     $ 44,720    Contact:  Beazer Homes USA, Inc. Carey Phelps, 770-829-3700 Director, Investor Relations & Corporate Communications investor.relations@beazer.com  
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