Hovnanian Enterprises, Inc. (NYSE: HOV), a leading national
homebuilder, reported results for its fiscal second quarter and
six-month period ended April 30, 2021.
RESULTS FOR THE THREE-MONTH AND
SIX-MONTH PERIODS ENDED APRIL 30, 2021:
- Total revenues increased 30.6% to
$703.2 million in the second quarter of fiscal 2021, compared with
$538.4 million in the same quarter of the prior year. For the six
months ended April 30, 2021, total revenues increased 23.8% to
$1.28 billion compared with $1.03 billion in the same period during
the prior fiscal year.
- Homebuilding gross margin
percentage, after cost of sales interest expense and land charges,
increased 360 basis points to 18.1% for the three months ended
April 30, 2021 compared with 14.5% during the same period a year
ago. During the first half of fiscal 2021, homebuilding gross
margin percentage, after cost of sales interest expense and land
charges, was 17.7%, up 400 basis points, compared with 13.7% during
the same period last year.
- Homebuilding gross margin
percentage, before cost of sales interest expense and land charges,
increased 310 basis points to 21.3% during the fiscal 2021 second
quarter compared with 18.2% in last year’s second quarter. For the
six months ended April 30, 2021, homebuilding gross margin
percentage, before cost of sales interest expense and land charges,
was 21.0%, up 320 basis points, compared with 17.8% in the same
period of the previous fiscal year.
- In 2019, we granted phantom stock
awards in lieu of actual equity under our long-term incentive plan
(“LTIP”). This was done in the best interest of shareholders to
avoid dilution concerns associated with our low stock price of
$14.50 at the time of grant. Expense related to the phantom stock
varies depending upon our common stock price at quarter end, is a
non-cash expense through fiscal 2021, and is reflected in our total
SG&A expenses. SG&A expenses in the second quarter of
fiscal 2021 included $17.5 million of incremental expense due to
the phantom stock awards, which is solely related to our common
stock price increasing from $51.16 at the end of the first quarter
to $132.59 at the end of the second quarter (“incremental phantom
stock expense”). Had equity shares rather than phantom stock been
utilized for our 2019 LTIP grants, there would not have been an
incremental SG&A expense due to stock price movements.
- Total SG&A was $82.6 million,
or 11.7% of total revenues, in the fiscal 2021 second quarter
compared with $55.9 million, or 10.4% of total revenues, in the
previous year’s second quarter. During the first six months of
fiscal 2021, total SG&A was $146.3 million, or 11.4% of total
revenues, compared with $116.3 million, or 11.3% of total revenues,
in the same period of the prior fiscal year. Excluding incremental
phantom stock expense, SG&A would have been $65.1 million, or
9.3% of total revenues for the second quarter of fiscal 2021 and
$128.8 million, or 10.1% of total revenues, for the six months
ended April 30, 2021.
- Total interest expense was $43.8
million for the second quarter of fiscal 2021 compared with $45.5
million during the second quarter of fiscal 2020. For the six
months ended April 30, 2021, total interest expense was $84.9
million compared with $88.6 million during the same period last
year.
- Income from unconsolidated joint
ventures was $2.6 million for the second quarter ended April 30,
2021 compared with $6.2 million in the fiscal 2020 second quarter.
For the first half of fiscal 2021, income from unconsolidated joint
ventures was $4.6 million compared with $7.8 million in the same
period a year ago.
- Income before income taxes for the
second quarter of fiscal 2021 was $31.0 million, up $26.9 million
compared with $4.2 million in the second quarter of the prior
fiscal year. For the first six months of fiscal 2021, income before
income taxes was $50.6 million compared with a loss of $3.3 million
during the same period of fiscal 2020.
- Adjusted pretax income, which is
income (loss) before income taxes excluding land-related charges
and loss (gain) on extinguishment of debt, was $31.1 million in the
second quarter of fiscal 2021 compared with $5.4 million in the
fiscal 2020 second quarter. Excluding incremental phantom stock
expense, our adjusted pretax income would have been $48.6 million
for the fiscal 2021 second quarter and would have exceeded the $45
million high end of the guidance range for the second quarter
provided last quarter. For the six months ended April 30, 2021,
adjusted pretax income was $52.6 million compared with a loss
before these items of $8.7 million during the first six months of
fiscal 2020. Excluding incremental phantom stock expense, our
adjusted pretax income would have been $70.1 million for the first
six months of fiscal 2021.
- The company recorded a full
reduction of the federal tax valuation allowance and a partial
reduction of the state tax valuation allowance during the quarter.
This resulted in a credit to tax expense and an increase in net
income during the quarter of $468.6 million. The remaining state
valuation allowance as of April 30, 2021 was $102.9 million. The
profit for the quarter, plus this reduction in valuation allowance,
resulted in total shareholders' equity increasing sequentially by
$489.0 million during the quarter.
- Net income, including the benefit
of the valuation allowance reduction, was $488.7 million, or $69.65
per diluted common share, for the three months ended April 30, 2021
compared with net income of $4.1 million, or $0.60 per diluted
common share, in the second quarter of the previous fiscal year.
For the first six months of fiscal 2021, net income, including the
benefit of the valuation allowance reduction, was $507.6 million,
or $72.71 per diluted common share, compared with a net loss of
$5.1 million, or $0.82 per diluted common share, in the same period
during fiscal 2020.
- EBITDA increased 49.9% to $76.3
million for the second quarter of fiscal 2021 compared with $50.9
million in the same quarter of the prior year. For the first half
of fiscal 2021, EBITDA was $138.3 million, a 57.4% increase,
compared with $87.9 million in the first half of fiscal 2020.
Excluding incremental phantom stock expense, adjusted EBITDA would
have increased 80.2% to $93.9 million for the second quarter of
fiscal 2021 and would have increased 91.4% to $157.8 million for
the six months ended April 30, 2021. Excluding incremental phantom
stock expense, adjusted EBITDA would have exceeded the high end of
the guidance range for the quarter provided last quarter.
- Financial services income before
income taxes was $10.4 million for the second quarter of fiscal
2021, up 119.1% compared with $4.7 million in the second quarter of
fiscal 2020. For the first half of fiscal 2021, financial services
income before income taxes increased 112.3% to $19.5 million
compared with $9.2 million in the same period one year ago.
- Consolidated contracts per
community increased 61.9% to 18.3 contracts per community for the
second quarter ended April 30, 2021 compared with 11.3 contracts
per community in last year’s second quarter. Contracts per
community, including domestic unconsolidated joint ventures(1),
increased 58.5% to 16.8 for the second quarter of fiscal 2021
compared with 10.6 for the second quarter of fiscal 2020. These
strong year over year improvements in sales pace were positively
impacted by slower sales during the initial COVID shutdown period
last year.
- The number of consolidated
contracts increased 19.1% to 1,771 homes during the fiscal 2021
second quarter, compared with 1,487 homes in last year’s second
quarter. The number of contracts, including domestic unconsolidated
joint ventures, for the three months ended April 30, 2021 increased
19.4% to 1,960 homes from 1,642 homes during the same quarter a
year ago.
- For the first half of fiscal 2021,
the number of consolidated contracts increased 26.3% to 3,549 homes
compared with 2,809 homes in the first half of fiscal 2020. The
number of contracts, including domestic unconsolidated joint
ventures, for the six months ended April 30, 2021 increased 25.1%
to 3,922 homes from 3,134 homes during the same period a year
ago.
- As of the end of the second quarter
of fiscal 2021, community count, including domestic unconsolidated
joint ventures, was 117 communities, compared with 155 communities
at April 30, 2020. Consolidated community count was 97 as of April
30, 2021, compared with 132 communities at the end of the previous
year’s second quarter. The decline was primarily a result of
selling out of communities at a faster than anticipated pace and
delayed community openings primarily related to adverse impacts
from COVID-19. We continue to expect to grow our fiscal 2021
year-end community count to approximately 130 communities,
including domestic unconsolidated joint ventures.
- Despite 1,618 second quarter
consolidated deliveries, consolidated lots controlled increased by
1,295 lots sequentially to 28,077 at April 30, 2021 from 26,782
lots at January 31, 2021, which illustrated our ability to control
more lots than we delivered.
- Due to consciously restricting
sales in many of our communities in recent months and a difficult
comparison to a very strong May last year, contracts per
community for May 2021 decreased 18.9% to 4.3 compared with
5.3 for the same month one year ago. The dollar value of May 2021
consolidated contracts decreased 23.0% to $197.0 million
compared with $255.9 million in May last year. However, May 2021
contracts had the highest gross margin percentage at the point
of contract for any month in more than a decade.
- The dollar value of consolidated
contract backlog, as of April 30, 2021, increased 85.2% to $1.77
billion compared with $958.1 million as of April 30, 2020. The
dollar value of contract backlog, including domestic unconsolidated
joint ventures, as of April 30, 2021, increased 80.0% to $2.04
billion compared with $1.13 billion as of April 30, 2020.
- Consolidated deliveries increased
22.1% to 1,618 homes in the fiscal 2021 second quarter compared
with 1,325 homes in the previous year’s second quarter. For the
fiscal 2021 second quarter, deliveries, including domestic
unconsolidated joint ventures, increased 17.2% to 1,773 homes
compared with 1,513 homes during the second quarter of fiscal
2020.
- For the first half of fiscal 2021,
consolidated deliveries increased 17.3% to 3,003 homes compared
with 2,561 homes in the first six months of the previous year. For
the first half of fiscal 2021, deliveries, including domestic
unconsolidated joint ventures, increased 13.1% to 3,277 homes
compared with 2,898 homes during the same period of fiscal
2020.
- The contract cancellation rate for
consolidated contracts was 16% for the second quarter ended April
30, 2021 compared with 23% in the fiscal 2020 second quarter. The
contract cancellation rate for contracts including domestic
unconsolidated joint ventures was 15% for the second quarter of
fiscal 2021 compared with 23% in the second quarter of the prior
year.
(1)When we refer to “Domestic
Unconsolidated Joint Ventures”, we are excluding results from our
single community unconsolidated joint venture in the Kingdom of
Saudi Arabia (KSA).
LIQUIDITY AND INVENTORY AS OF APRIL 30,
2021:
- During the second quarter of fiscal
2021, land and land development spending was $175.0 million, an
increase of 53.0% compared with $114.4 million in last year’s
second quarter. For the first half of fiscal 2021, land and land
development spending was $353.6 million, an increase of 52.2%
compared with $232.3 million in the same period one year ago.
- Total liquidity at the end of the
second quarter of fiscal 2021 was $352.8 million, well above our
targeted liquidity range of $170 million to $245 million.
- In the second quarter of fiscal
2021, approximately 3,400 lots were put under option or acquired in
33 consolidated communities.
- As of April 30, 2021, the total
controlled consolidated lots increased 5.0% to 28,077 compared with
26,734 lots at the end of the previous year’s second quarter. Based
on trailing twelve-month deliveries, the current position equaled a
4.6 years’ supply.
- We sent a notice of redemption to
pay off in full the remaining $111 million principal amount of our
10.0% senior secured notes due July 2022 at a purchase price of
100% of the principal amount thereof plus accrued and unpaid
interest to, but excluding, the redemption date of July 31, 2021.
Additionally, we presently intend to pay off in full the remaining
principal amount of $70 million of our 10.5% senior secured notes
due July 2024 in advance of their maturity.
FINANCIAL
GUIDANCE(2):
Financial guidance for both the third quarter
and full year for fiscal 2021 assumes no adverse changes in current
market conditions and excludes further impact to SG&A expenses
from phantom stock expense related solely to stock price movements
from the closing price of $132.59 at April 30, 2021. Every $4
increase or decrease in common stock price from the end of the
second quarter, results in an approximate $1 million increase or
decrease, respectively, of phantom stock expense.
- For the third quarter of fiscal
2021, total revenues are expected to be between $700 million and
$750 million, adjusted pretax income is expected to be between $35
million and $45 million and adjusted EBITDA is expected to be
between $80 million and $90 million.
- For all of fiscal 2021, total
revenues are expected to be between $2.65 billion and $2.80
billion; however, we are increasing our guidance for adjusted
pretax income to be between $150 million and $170 million and we
are increasing our guidance for adjusted EBITDA to be between $310
million and $350 million.
(2)The Company
cannot provide a reconciliation between its non-GAAP projections
and the most directly comparable GAAP measures without unreasonable
efforts because it is unable to predict with reasonable certainty
the ultimate outcome of certain significant items required for the
reconciliation. These items include, but are not limited to,
land-related charges, inventory impairment loss and land option
write-offs and loss (gain) on extinguishment of debt. These items
are uncertain, depend on various factors and could have a material
impact on GAAP reported results.
COMMENTS FROM MANAGEMENT:
“We are pleased with our trend of reporting
improved results. Our fiscal 2021 second quarter total revenues,
gross margin percentage, adjusted EBITDA and adjusted pretax income
were all within the guidance range that we gave last quarter. Had
our SG&A not contained incremental phantom stock expense
related solely to our stock price increasing from $51.16 at the end
of the first quarter to $132.59 at the end of the second quarter,
our results would have been above the high end of the guidance
range for adjusted EBITDA and adjusted pretax income, as well as
within the SG&A ratio guidance range,” stated Ara K. Hovnanian,
Chairman of the Board, President and Chief Executive Officer. “By
using phantom stock rather than actual equity shares for our 2019
LTIP grant when our stock price was so low, the Company avoided the
long-term impacts of dilution and remains convinced it made the
right decision for shareholders.”
“For the second consecutive quarter, our
contract backlog dollars increased 85% year over year. Despite
increased material and labor costs, gross margins on contracts
currently in our backlog along with continued strong demand for new
homes gave us the confidence to raise our full fiscal 2021
profitability guidance. We believe that the outlook for housing
demand will remain strong over the next few years. Finally, our
progress in increasing our land position and our significant
increases in land and land development spend over the recent
quarters gives us confidence about our ability to grow community
count for the remainder of this year and beyond. By continuing to
execute on our strategy, we can maximize returns for all of our
stakeholders,” concluded Mr. Hovnanian.
WEBCAST INFORMATION:
Hovnanian Enterprises will webcast its fiscal
2021 second quarter financial results conference call at 11:00 a.m.
E.T. on Thursday, June 3, 2021. The webcast can be accessed live
through the “Investor Relations” section of Hovnanian Enterprises’
website at http://www.khov.com. For those who are not available to
listen to the live webcast, an archive of the broadcast will be
available under the “Past Events” section of the Investor Relations
page on the Hovnanian website at http://www.khov.com. The archive
will be available for 12 months.
ABOUT HOVNANIAN ENTERPRISES,
INC.:
Hovnanian Enterprises, Inc., founded in 1959 by
Kevork S. Hovnanian, is headquartered in Matawan, New Jersey and,
through its subsidiaries, is one of the nation’s largest
homebuilders with operations in Arizona, California, Delaware,
Florida, Georgia, Illinois, Maryland, New Jersey, Ohio,
Pennsylvania, South Carolina, Texas, Virginia, Washington, D.C. and
West Virginia. The Company’s homes are marketed and sold under the
trade name K. Hovnanian® Homes. Additionally, the Company’s
subsidiaries, as developers of K. Hovnanian’s® Four Seasons
communities, make the Company one of the nation’s largest builders
of active lifestyle communities.
Additional information on Hovnanian Enterprises,
Inc. can be accessed through the “Investor Relations” section of
the Hovnanian Enterprises’ website at http://www.khov.com. To be
added to Hovnanian's investor e-mail list, please send an e-mail to
IR@khov.com or sign up at http://www.khov.com.
NON-GAAP FINANCIAL
MEASURES:
Consolidated earnings before interest
expense and income taxes (“EBIT”) and before depreciation and
amortization (“EBITDA”) and before inventory impairment loss and
land option write-offs and loss (gain) on extinguishment of debt
(“Adjusted EBITDA”) are not U.S. generally accepted accounting
principles (GAAP) financial measures. This earnings release also
presents EBITDA and Adjusted EBITDA adjusted to exclude the impact
of incremental phantom stock expense. The most directly comparable
GAAP financial measure is net income (loss). The reconciliation for
historical periods of EBIT, EBITDA and Adjusted EBITDA to net
income (loss) is presented in a table attached to this earnings
release or elsewhere in this earnings release.
Homebuilding gross margin, before cost
of sales interest expense and land charges, and homebuilding gross
margin percentage, before cost of sales interest expense and land
charges, are non-GAAP financial measures. The most directly
comparable GAAP financial measures are homebuilding gross margin
and homebuilding gross margin percentage, respectively. The
reconciliation for historical periods of homebuilding gross margin,
before cost of sales interest expense and land charges, and
homebuilding gross margin percentage, before cost of sales interest
expense and land charges, to homebuilding gross margin and
homebuilding gross margin percentage, respectively, is presented in
a table attached to this earnings release.
Adjusted pretax income (loss), which is
defined as income (loss) before income taxes excluding land-related
charges and loss (gain) on extinguishment of debt is a non-GAAP
financial measure. This earnings release also presents adjusted
pretax income adjusted to exclude the impact of incremental phantom
stock expense. The most directly comparable GAAP financial measure
is income (loss) before income taxes. The reconciliation for
historical periods of adjusted pretax income (loss) to income
(loss) before income taxes is presented in a table attached to this
earnings release or elsewhere in this earnings
release.
SG&A excluding the impact of
incremental phantom stock expense is a non-GAAP financial measure.
The most directly comparable GAAP financial measure is SG&A, to
which SG&A excluding the impact of incremental phantom stock
expense is reconciled herein.
Total liquidity is comprised of $218.3
million of cash and cash equivalents, $9.5 million of restricted
cash required to collateralize letters of credit and $125.0 million
availability under the senior secured revolving credit facility as
of April 30, 2021.
FORWARD-LOOKING STATEMENTS
All statements in this press release
that are not historical facts should be considered as
“Forward-Looking Statements” within the meaning of the “Safe
Harbor” provisions of the Private Securities Litigation Reform Act
of 1995. Such statements involve known and unknown risks,
uncertainties and other factors that may cause 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
forward-looking statements include but are not limited to
statements related to the Company’s goals and expectations with
respect to its financial results for future financial periods.
Although we believe that our plans, intentions and expectations
reflected in, or suggested by, such forward-looking statements are
reasonable, we can give no assurance that such plans, intentions or
expectations will be achieved. By their nature, forward-looking
statements: (i) speak only as of the date they are made, (ii) are
not guarantees of future performance or results and (iii) are
subject to risks, uncertainties and assumptions that are difficult
to predict or quantify. Therefore, actual results could differ
materially and adversely from those forward-looking statements as a
result of a variety of factors. Such risks, uncertainties and other
factors include, but are not limited to, (1) the outbreak and
spread of COVID-19 and the measures that governments, agencies, law
enforcement and/or health authorities implement to address it; (2)
changes in general and local economic, industry and business
conditions and impacts of a significant homebuilding downturn; (3)
adverse weather and other environmental conditions and natural
disasters; (4) the seasonality of the Company’s business; (5) the
availability and cost of suitable land and improved lots and
sufficient liquidity to invest in such land and lots; (6) shortages
in, and price fluctuations of, raw materials and labor, including
due to changes in trade policies and the imposition of tariffs and
duties on homebuilding materials and products and related trade
disputes with, and retaliatory measures taken by, other countries;
(7) reliance on, and the performance of, subcontractors; (8)
regional and local economic factors, including dependency on
certain sectors of the economy, and employment levels affecting
home prices and sales activity in the markets where the Company
builds homes; (9) increases in cancellations of agreements of sale;
(10) fluctuations in interest rates and the availability of
mortgage financing; (11) changes in tax laws affecting the
after-tax costs of owning a home; (12) legal claims brought against
us and not resolved in our favor, such as product liability
litigation, warranty claims and claims made by mortgage investors;
(13) levels of competition; (14) utility shortages and outages or
rate fluctuations; (15) information technology failures and data
security breaches; (16) negative publicity; (17) high leverage and
restrictions on the Company’s operations and activities imposed by
the agreements governing the Company’s outstanding indebtedness;
(18) availability and terms of financing to the Company; (19) the
Company’s sources of liquidity; (20) changes in credit ratings;
(21) government regulation, including regulations concerning
development of land, the home building, sales and customer
financing processes, tax laws and the environment; (22) operations
through unconsolidated joint ventures with third parties; (23)
significant influence of the Company’s controlling stockholders;
(24) availability of net operating loss carryforwards; (25) loss of
key management personnel or failure to attract qualified personnel;
and (26) certain risks, uncertainties and other factors described
in detail in the Company’s Annual Report on Form 10-K for the
fiscal year ended October 31, 2020 and the Company’s Quarterly
Reports on Form 10-Q for the quarterly periods during fiscal 2021
and subsequent filings with the Securities and Exchange Commission.
Except as otherwise required by applicable securities laws, we
undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, changed circumstances or any other
reason.
Hovnanian
Enterprises, Inc. |
April 30,
2021 |
Statements of
consolidated operations |
(In thousands,
except per share data) |
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
|
April 30, |
|
April 30, |
|
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Total
revenues |
$703,162 |
|
|
$538,351 |
|
|
$1,277,826 |
|
|
$1,032,407 |
|
Costs and expenses
(1) |
|
674,771 |
|
|
|
540,219 |
|
|
|
1,231,766 |
|
|
|
1,052,707 |
|
(Loss) gain on
extinguishment of debt |
|
- |
|
|
|
(174 |
) |
|
|
- |
|
|
|
9,282 |
|
Income from
unconsolidated joint ventures |
|
2,641 |
|
|
|
6,221 |
|
|
|
4,557 |
|
|
|
7,761 |
|
Income (loss)
before income taxes |
|
31,032 |
|
|
|
4,179 |
|
|
|
50,617 |
|
|
|
(3,257 |
) |
Income tax
(benefit) provision |
|
(457,644 |
) |
|
|
100 |
|
|
|
(457,018 |
) |
|
|
1,812 |
|
Net income
(loss) |
$488,676 |
|
|
$4,079 |
|
|
$507,635 |
|
|
$(5,069 |
) |
|
|
|
|
|
|
|
|
|
|
Per share
data: |
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
Net income (loss)
per common share |
$71.11 |
|
|
$0.63 |
|
|
$74.00 |
|
|
$(0.82 |
) |
|
Weighted average
number of common shares outstanding (2) |
|
6,248 |
|
|
|
6,172 |
|
|
|
6,236 |
|
|
|
6,166 |
|
Assuming
dilution: |
|
|
|
|
|
|
|
|
Net income (loss)
per common share |
$69.65 |
|
|
$0.60 |
|
|
$72.71 |
|
|
$(0.82 |
) |
|
Weighted average
number of common shares outstanding (2) |
|
6,368 |
|
|
|
6,432 |
|
|
|
6,331 |
|
|
|
6,166 |
|
|
(1) Includes
inventory impairment loss and land option write-offs. |
(2) For periods
with a net (loss), basic shares are used in accordance with GAAP
rules. |
|
|
Hovnanian
Enterprises, Inc. |
April 30,
2021 |
Reconciliation of
income (loss) before income taxes excluding land-related charges
and loss (gain) on extinguishment of debt to income (loss) before
income taxes |
(In
thousands) |
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
|
April 30, |
|
April 30, |
|
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
|
(Unaudited) |
|
(Unaudited) |
Income (loss)
before income taxes |
$31,032 |
|
|
$4,179 |
|
|
$50,617 |
|
|
$(3,257 |
) |
Inventory
impairment loss and land option write-offs |
|
81 |
|
|
|
1,010 |
|
|
|
1,958 |
|
|
|
3,838 |
|
Loss (gain) on
extinguishment of debt |
|
- |
|
|
|
174 |
|
|
|
- |
|
|
|
(9,282 |
) |
Income (loss)
before income taxes excluding land-related charges and loss
(gain) on extinguishment of debt (1) |
$31,113 |
|
|
$5,363 |
|
|
$52,575 |
|
|
$(8,701 |
) |
|
(1) Income (loss)
before income taxes excluding land-related charges and loss (gain)
on extinguishment of debt is a non-GAAP financial measure. The most
directly comparable GAAP financial measure is income (loss) before
income taxes. |
Hovnanian
Enterprises, Inc. |
April 30,
2021 |
Gross margin |
(In
thousands) |
|
|
Homebuilding Gross Margin |
|
Homebuilding Gross Margin |
|
|
Three Months Ended |
|
Six Months Ended |
|
|
April 30, |
|
April 30, |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
(Unaudited) |
|
(Unaudited) |
Sale of homes |
|
$679,515 |
|
|
$523,347 |
|
|
$1,230,880 |
|
|
$1,002,580 |
|
Cost of sales, excluding
interest expense and land charges (1) |
|
|
535,017 |
|
|
|
427,944 |
|
|
|
972,389 |
|
|
|
824,262 |
|
Homebuilding gross margin,
before cost of sales interest expense and land charges
(2) |
|
|
144,498 |
|
|
|
95,403 |
|
|
|
258,491 |
|
|
|
178,318 |
|
Cost of sales interest
expense, excluding land sales interest expense |
|
|
21,704 |
|
|
|
18,537 |
|
|
|
38,421 |
|
|
|
36,673 |
|
Homebuilding gross margin,
after cost of sales interest expense, before land charges
(2) |
|
|
122,794 |
|
|
|
76,866 |
|
|
|
220,070 |
|
|
|
141,645 |
|
Land charges |
|
|
81 |
|
|
|
1,010 |
|
|
|
1,958 |
|
|
|
3,838 |
|
Homebuilding gross margin |
|
$122,713 |
|
|
$75,856 |
|
|
$218,112 |
|
|
$137,807 |
|
|
|
|
|
|
|
|
|
|
Homebuilding Gross margin
percentage |
|
|
18.1% |
|
|
|
14.5% |
|
|
|
17.7% |
|
|
|
13.7% |
|
Homebuilding Gross margin
percentage, before cost of sales interest expense and
land charges (2) |
|
|
21.3% |
|
|
|
18.2% |
|
|
|
21.0% |
|
|
|
17.8% |
|
Homebuilding Gross margin
percentage, after cost of sales interest expense, before
land charges (2) |
|
|
18.1% |
|
|
|
14.7% |
|
|
|
17.9% |
|
|
|
14.1% |
|
|
|
|
Land Sales Gross Margin |
|
Land Sales Gross Margin |
|
|
Three Months Ended |
|
Six Months Ended |
|
|
April 30, |
|
April 30, |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
(Unaudited) |
|
(Unaudited) |
Land and lot sales |
|
$1,549 |
|
|
$50 |
|
|
$4,911 |
|
|
$75 |
|
Land and lot sales cost of
sales, excluding interest and land charges (1) |
|
|
1,517 |
|
|
|
83 |
|
|
|
3,783 |
|
|
|
120 |
|
Land and lot sales gross
margin, excluding interest and land charges |
|
|
32 |
|
|
|
(33 |
) |
|
|
1,128 |
|
|
|
(45 |
) |
Land and lot sales
interest |
|
|
21 |
|
|
|
52 |
|
|
|
469 |
|
|
|
52 |
|
Land and lot sales gross
margin, including interest and excluding land charges |
|
$11 |
|
|
$(85 |
) |
|
$659 |
|
|
$(97 |
) |
|
|
(1) Does not
include cost associated with walking away from land options or
inventory impairment losses which are recorded as Inventory
impairment loss and land option write-offs in the Condensed
Consolidated Statements of Operations. |
(2) Homebuilding
gross margin, before cost of sales interest expense and land
charges, and homebuilding gross margin percentage, before cost of
sales interest expense and land charges, are non-GAAP financial
measures. The most directly comparable GAAP financial measures are
homebuilding gross margin and homebuilding gross margin percentage,
respectively. |
Hovnanian
Enterprises, Inc. |
April 30,
2021 |
Reconciliation of
adjusted EBITDA to net income (loss) |
(In
thousands) |
|
Three Months Ended |
|
Six Months Ended |
|
April 30, |
|
April 30, |
|
|
2021 |
|
|
|
2020 |
|
|
2021 |
|
|
|
2020 |
|
|
(Unaudited) |
|
(Unaudited) |
Net income (loss) |
$488,676 |
|
|
$4,079 |
|
$507,635 |
|
|
$(5,069 |
) |
Income tax (benefit)
provision |
|
(457,644 |
) |
|
|
100 |
|
|
(457,018 |
) |
|
|
1,812 |
|
Interest expense |
|
43,758 |
|
|
|
45,458 |
|
|
84,898 |
|
|
|
88,597 |
|
EBIT (1) |
|
74,790 |
|
|
|
49,637 |
|
|
135,515 |
|
|
|
85,340 |
|
Depreciation and
amortization |
|
1,484 |
|
|
|
1,263 |
|
|
2,822 |
|
|
|
2,542 |
|
EBITDA (2) |
|
76,274 |
|
|
|
50,900 |
|
|
138,337 |
|
|
|
87,882 |
|
Inventory impairment loss and
land option write-offs |
|
81 |
|
|
|
1,010 |
|
|
1,958 |
|
|
|
3,838 |
|
Loss (gain) on extinguishment
of debt |
|
- |
|
|
|
174 |
|
|
- |
|
|
|
(9,282 |
) |
Adjusted EBITDA (3) |
$76,355 |
|
|
$52,084 |
|
$140,295 |
|
|
$82,438 |
|
|
|
|
|
|
|
|
|
Interest incurred |
$41,870 |
|
|
$45,323 |
|
$83,327 |
|
|
$89,657 |
|
|
|
|
|
|
|
|
|
Adjusted EBITDA to interest
incurred |
|
1.82 |
|
|
|
1.15 |
|
|
1.68 |
|
|
|
0.92 |
|
|
|
(1) EBIT is a
non-GAAP financial measure. The most directly comparable GAAP
financial measure is net income (loss). EBIT represents earnings
before interest expense and income taxes. |
(2) EBITDA is a
non-GAAP financial measure. The most directly comparable GAAP
financial measure is net income (loss). EBITDA represents earnings
before interest expense, income taxes, depreciation and
amortization. |
(3) Adjusted
EBITDA is a non-GAAP financial measure. The most directly
comparable GAAP financial measure is net income (loss). Adjusted
EBITDA represents earnings before interest expense, income taxes,
depreciation, amortization, inventory impairment loss and land
option write-offs and (loss) gain on extinguishment of debt. |
|
|
Hovnanian Enterprises,
Inc. |
|
|
|
|
|
|
|
April 30,
2021 |
|
|
|
|
|
|
|
Interest incurred, expensed
and capitalized |
|
|
|
|
|
|
|
(In thousands) |
|
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
April 30, |
|
April 30, |
|
|
2021 |
|
|
|
2020 |
|
|
2021 |
|
|
|
2020 |
|
|
(Unaudited) |
|
(Unaudited) |
Interest capitalized at
beginning of period |
$65,327 |
|
|
$67,879 |
|
$65,010 |
|
|
$71,264 |
|
Plus interest incurred |
|
41,870 |
|
|
|
45,323 |
|
|
83,327 |
|
|
|
89,657 |
|
Less interest expensed |
|
43,758 |
|
|
|
45,458 |
|
|
84,898 |
|
|
|
88,597 |
|
Less interest contributed to
unconsolidated joint venture (1) |
|
3,667 |
|
|
|
- |
|
|
3,667 |
|
|
|
4,580 |
|
Interest capitalized at end of
period (2) |
$59,772 |
|
|
$67,744 |
|
$59,772 |
|
|
$67,744 |
|
|
(1) Represents
capitalized interest which was included as part of the assets
contributed to joint ventures the company entered into in April
2021 and December 2019 during the six months ended April 30, 2021
and 2020, respectively. There was no impact to the Condensed
Consolidated Statement of Operations as a result of these
transactions. |
(2) Capitalized
interest amounts are shown gross before allocating any portion of
impairments to capitalized interest. |
HOVNANIAN ENTERPRISES, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(In Thousands)
|
|
April 30, |
|
|
October 31, |
|
|
|
2021 |
|
|
2020 |
|
ASSETS |
|
|
(Unaudited) |
|
|
(1) |
|
Homebuilding: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
$218,321 |
|
|
|
$262,489 |
|
Restricted cash and cash equivalents |
|
|
|
12,753 |
|
|
|
|
14,731 |
|
Inventories: |
|
|
|
|
|
|
|
|
Sold and unsold homes and lots under development |
|
|
|
1,029,089 |
|
|
|
|
921,594 |
|
Land and land options held for future development or sale |
|
|
|
102,370 |
|
|
|
|
91,957 |
|
Consolidated inventory not owned |
|
|
|
125,414 |
|
|
|
|
182,224 |
|
Total inventories |
|
|
|
1,256,873 |
|
|
|
|
1,195,775 |
|
Investments in and advances to unconsolidated joint ventures |
|
|
|
112,505 |
|
|
|
|
103,164 |
|
Receivables, deposits and notes, net |
|
|
|
34,102 |
|
|
|
|
33,686 |
|
Property, plant and equipment, net |
|
|
|
17,828 |
|
|
|
|
18,185 |
|
Prepaid expenses and other assets |
|
|
|
56,712 |
|
|
|
|
58,705 |
|
Total homebuilding |
|
|
|
1,709,094 |
|
|
|
|
1,686,735 |
|
|
|
|
|
|
|
|
|
|
Financial services |
|
|
|
169,708 |
|
|
|
|
140,607 |
|
|
|
|
|
|
|
|
|
|
Deferred tax assets, net |
|
|
|
459,186 |
|
|
|
|
- |
|
Total assets |
|
|
$2,337,988 |
|
|
|
$1,827,342 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
Nonrecourse mortgages secured by inventory, net of debt issuance
costs |
|
|
$113,861 |
|
|
|
$135,122 |
|
Accounts payable and other liabilities |
|
|
|
379,381 |
|
|
|
|
359,274 |
|
Customers’ deposits |
|
|
|
65,930 |
|
|
|
|
48,286 |
|
Liabilities from inventory not owned, net of debt issuance
costs |
|
|
|
90,430 |
|
|
|
|
131,204 |
|
Senior notes and credit facilities (net of discounts, premiums and
debt issuance costs) |
|
|
|
1,429,324 |
|
|
|
|
1,431,110 |
|
Accrued Interest |
|
|
|
35,321 |
|
|
|
|
35,563 |
|
Total homebuilding |
|
|
|
2,114,247 |
|
|
|
|
2,140,559 |
|
|
|
|
|
|
|
|
|
|
Financial services |
|
|
|
148,439 |
|
|
|
|
119,045 |
|
Income taxes payable |
|
|
|
2,588 |
|
|
|
|
3,832 |
|
Total liabilities |
|
|
|
2,265,274 |
|
|
|
|
2,263,436 |
|
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
|
|
|
|
Hovnanian Enterprises, Inc.
stockholders' equity deficit: |
|
|
|
|
|
|
|
|
Preferred stock, $0.01 par value - authorized 100,000 shares;
issued and outstanding 5,600 shares with a liquidation
preference of $140,000 at April 30, 2021 and October 31, 2020 |
|
|
|
135,299 |
|
|
|
|
135,299 |
|
Common stock, Class A, $0.01 par value - authorized 16,000,000
shares; issued 6,030,903 shares at April 30, 2021 and 5,990,310
shares at October 31, 2020 |
|
|
|
60 |
|
|
|
|
60 |
|
Common stock, Class B, $0.01 par value (convertible to Class A at
time of sale) - authorized 2,400,000 shares; issued 657,554
shares at April 30, 2021 and 649,886 shares at October 31,
2020 |
|
|
|
7 |
|
|
|
|
7 |
|
Paid in capital - common stock |
|
|
|
719,347 |
|
|
|
|
718,110 |
|
Accumulated deficit |
|
|
|
(667,410 |
) |
|
|
|
(1,175,045 |
) |
Treasury stock - at cost – 470,430 shares of Class A common stock
and 27,669 shares of Class B common stock at April 30, 2021
and October 31, 2020 |
|
|
|
(115,360 |
) |
|
|
|
(115,360 |
) |
Total Hovnanian Enterprises, Inc. stockholders’ equity
(deficit) |
|
|
|
71,943 |
|
|
|
|
(436,929 |
) |
Noncontrolling interest in
consolidated joint ventures |
|
|
|
771 |
|
|
|
|
835 |
|
Total equity (deficit) |
|
|
|
72,714 |
|
|
|
|
(436,094 |
) |
Total liabilities and
equity |
|
|
$2,337,988 |
|
|
|
$1,827,342 |
|
(1) Derived from the audited balance sheet as
of October 31, 2020.
HOVNANIAN ENTERPRISES, INC. AND
SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(In
Thousands Except Per Share Data)(Unaudited)
|
|
Three Months Ended April 30, |
|
|
Six Months Ended April 30, |
|
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sale of homes |
|
|
$679,515 |
|
|
|
$523,347 |
|
|
|
$1,230,880 |
|
|
|
$1,002,580 |
|
Land sales and other revenues |
|
|
|
1,919 |
|
|
|
|
643 |
|
|
|
|
5,721 |
|
|
|
|
1,452 |
|
Total homebuilding |
|
|
|
681,434 |
|
|
|
|
523,990 |
|
|
|
|
1,236,601 |
|
|
|
|
1,004,032 |
|
Financial services |
|
|
|
21,728 |
|
|
|
|
14,361 |
|
|
|
|
41,225 |
|
|
|
|
28,375 |
|
Total revenues |
|
|
|
703,162 |
|
|
|
|
538,351 |
|
|
|
|
1,277,826 |
|
|
|
|
1,032,407 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Homebuilding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales, excluding interest |
|
|
|
536,534 |
|
|
|
|
428,027 |
|
|
|
|
976,172 |
|
|
|
|
824,382 |
|
Cost of sales interest |
|
|
|
21,725 |
|
|
|
|
18,589 |
|
|
|
|
38,890 |
|
|
|
|
36,725 |
|
Inventory impairment loss and land option write-offs |
|
|
|
81 |
|
|
|
|
1,010 |
|
|
|
|
1,958 |
|
|
|
|
3,838 |
|
Total cost of sales |
|
|
|
558,340 |
|
|
|
|
447,626 |
|
|
|
|
1,017,020 |
|
|
|
|
864,945 |
|
Selling, general and administrative |
|
|
|
42,204 |
|
|
|
|
40,605 |
|
|
|
|
82,429 |
|
|
|
|
81,279 |
|
Total homebuilding expenses |
|
|
|
600,544 |
|
|
|
|
488,231 |
|
|
|
|
1,099,449 |
|
|
|
|
946,224 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial services |
|
|
|
11,361 |
|
|
|
|
9,630 |
|
|
|
|
21,715 |
|
|
|
|
19,184 |
|
Corporate general and administrative |
|
|
|
40,382 |
|
|
|
|
15,275 |
|
|
|
|
63,865 |
|
|
|
|
35,019 |
|
Other interest |
|
|
|
22,033 |
|
|
|
|
26,869 |
|
|
|
|
46,008 |
|
|
|
|
51,872 |
|
Other operations |
|
|
|
451 |
|
|
|
|
214 |
|
|
|
|
729 |
|
|
|
|
408 |
|
Total expenses |
|
|
|
674,771 |
|
|
|
|
540,219 |
|
|
|
|
1,231,766 |
|
|
|
|
1,052,707 |
|
(Loss) gain on extinguishment
of debt |
|
|
|
- |
|
|
|
|
(174 |
) |
|
|
|
- |
|
|
|
|
9,282 |
|
Income from unconsolidated
joint ventures |
|
|
|
2,641 |
|
|
|
|
6,221 |
|
|
|
|
4,557 |
|
|
|
|
7,761 |
|
Income (loss) before income
taxes |
|
|
|
31,032 |
|
|
|
|
4,179 |
|
|
|
|
50,617 |
|
|
|
|
(3,257 |
) |
State and federal income tax
(benefit) provision: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
State |
|
|
|
(91,374 |
) |
|
|
|
100 |
|
|
|
|
(90,748 |
) |
|
|
|
1,812 |
|
Federal |
|
|
|
(366,270 |
) |
|
|
|
- |
|
|
|
|
(366,270 |
) |
|
|
|
- |
|
Total income taxes |
|
|
|
(457,644 |
) |
|
|
|
100 |
|
|
|
|
(457,018 |
) |
|
|
|
1,812 |
|
Net income (loss) |
|
|
$488,676 |
|
|
|
$4,079 |
|
|
|
$507,635 |
|
|
|
$(5,069 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Per share data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share |
|
|
$71.11 |
|
|
|
$0.63 |
|
|
|
$74.00 |
|
|
|
$(0.82 |
) |
Weighted-average number of common shares outstanding |
|
|
|
6,248 |
|
|
|
|
6,172 |
|
|
|
|
6,236 |
|
|
|
|
6,166 |
|
Assuming dilution: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common share |
|
|
$69.65 |
|
|
|
$0.60 |
|
|
|
$72.71 |
|
|
|
$(0.82 |
) |
Weighted-average number of common shares outstanding |
|
|
|
6,368 |
|
|
|
|
6,432 |
|
|
|
|
6,331 |
|
|
|
|
6,166 |
|
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA EXCLUDES UNCONSOLIDATED
JOINT VENTURES) |
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Three Months Ended |
Three Months Ended |
Backlog |
|
|
April 30, |
April 30, |
April 30, |
|
|
|
2021 |
|
2020 |
% Change |
|
2021 |
|
2020 |
% Change |
|
2021 |
|
2020 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(NJ, PA) |
Home |
|
64 |
|
66 |
(3.0)% |
|
|
42 |
|
94 |
(55.3)% |
|
|
142 |
|
106 |
34.0% |
|
|
Dollars |
$49,948 |
$23,266 |
114.7% |
|
$28,686 |
$46,791 |
(38.7)% |
|
$105,828 |
$50,771 |
108.4% |
|
|
Avg. Price |
$780,438 |
$352,515 |
121.4% |
|
$683,000 |
$497,777 |
37.2% |
|
$745,268 |
$478,972 |
55.6% |
|
Mid-Atlantic |
|
|
|
|
|
|
|
|
|
|
(DE, MD, VA, WV) |
Home |
|
242 |
|
247 |
(2.0)% |
|
|
216 |
|
168 |
28.6% |
|
|
585 |
|
429 |
36.4% |
|
|
Dollars |
$152,237 |
$128,652 |
18.3% |
|
$112,124 |
$89,677 |
25.0% |
|
$350,183 |
$228,622 |
53.2% |
|
|
Avg. Price |
$629,079 |
$520,858 |
20.8% |
|
$519,093 |
$533,792 |
(2.8)% |
|
$598,603 |
$532,918 |
12.3% |
|
Midwest |
|
|
|
|
|
|
|
|
|
|
(IL, OH) |
Home |
|
225 |
|
174 |
29.3% |
|
|
203 |
|
184 |
10.3% |
|
|
673 |
|
468 |
43.8% |
|
|
Dollars |
$80,541 |
$54,501 |
47.8% |
|
$64,010 |
$56,543 |
13.2% |
|
$208,841 |
$132,523 |
57.6% |
|
|
Avg. Price |
$357,960 |
$313,224 |
14.3% |
|
$315,320 |
$307,299 |
2.6% |
|
$310,314 |
$283,169 |
9.6% |
|
Southeast |
|
|
|
|
|
|
|
|
|
|
(FL, GA, SC) |
Home |
|
153 |
|
109 |
40.4% |
|
|
167 |
|
127 |
31.5% |
|
|
392 |
|
287 |
36.6% |
|
|
Dollars |
$66,485 |
$48,508 |
37.1% |
|
$80,863 |
$56,317 |
43.6% |
|
$185,139 |
$131,695 |
40.6% |
|
|
Avg. Price |
$434,542 |
$445,028 |
(2.4)% |
|
$484,210 |
$443,441 |
9.2% |
|
$472,293 |
$458,868 |
2.9% |
|
Southwest |
|
|
|
|
|
|
|
|
|
|
(AZ, TX) |
Home |
|
829 |
|
582 |
42.4% |
|
|
633 |
|
515 |
22.9% |
|
|
1,416 |
|
765 |
85.1% |
|
|
Dollars |
$319,618 |
$187,493 |
70.5% |
|
$217,165 |
$170,485 |
27.4% |
|
$540,321 |
$262,634 |
105.7% |
|
|
Avg. Price |
$385,546 |
$322,153 |
19.7% |
|
$343,073 |
$331,039 |
3.6% |
|
$381,583 |
$343,312 |
11.1% |
|
West |
|
|
|
|
|
|
|
|
|
|
(CA) |
Home |
|
258 |
|
309 |
(16.5)% |
|
|
357 |
|
237 |
50.6% |
|
|
689 |
|
328 |
110.1% |
|
|
Dollars |
$151,571 |
$139,418 |
8.7% |
|
$176,667 |
$103,534 |
70.6% |
|
$384,089 |
$151,812 |
153.0% |
|
|
Avg. Price |
$587,484 |
$451,191 |
30.2% |
|
$494,866 |
$436,852 |
13.3% |
|
$557,459 |
$462,841 |
20.4% |
|
Consolidated Total |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
1,771 |
|
1,487 |
19.1% |
|
|
1,618 |
|
1,325 |
22.1% |
|
|
3,897 |
|
2,383 |
63.5% |
|
|
Dollars |
$820,400 |
$581,838 |
41.0% |
|
$679,515 |
$523,347 |
29.8% |
|
$1,774,401 |
$958,057 |
85.2% |
|
|
Avg. Price |
$463,241 |
$391,282 |
18.4% |
|
$419,972 |
$394,979 |
6.3% |
|
$455,325 |
$402,038 |
13.3% |
|
Unconsolidated Joint Ventures (2) |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
189 |
|
155 |
21.9% |
|
|
155 |
|
188 |
(17.6)% |
|
|
476 |
|
303 |
57.1% |
|
|
Dollars |
$109,806 |
$82,890 |
32.5% |
|
$91,067 |
$112,196 |
(18.8)% |
|
$266,673 |
$175,817 |
51.7% |
|
|
Avg.
Price |
$580,984 |
$534,774 |
8.6% |
|
$587,529 |
$596,787 |
(1.6)% |
|
$560,238 |
$580,254 |
(3.4)% |
|
Grand Total |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
1,960 |
|
1,642 |
19.4% |
|
|
1,773 |
|
1,513 |
17.2% |
|
|
4,373 |
|
2,686 |
62.8% |
|
|
Dollars |
$930,206 |
$664,728 |
39.9% |
|
$770,582 |
$635,543 |
21.2% |
|
$2,041,074 |
$1,133,874 |
80.0% |
|
|
Avg. Price |
$474,595 |
$404,828 |
17.2% |
|
$434,620 |
$420,055 |
3.5% |
|
$466,745 |
$422,142 |
10.6% |
|
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
146 |
|
284 |
(48.6)% |
|
|
0 |
|
0 |
0.0% |
|
|
1,451 |
|
581 |
149.7% |
|
|
Dollars |
$22,805 |
$44,393 |
(48.6)% |
|
$0 |
$0 |
0.0% |
|
$227,851 |
$91,551 |
148.9% |
|
|
Avg. Price |
$156,199 |
$156,317 |
(0.1)% |
|
$0 |
$0 |
0.0% |
|
$157,030 |
$157,575 |
(0.3)% |
|
|
DELIVERIES INCLUDE EXTRAS |
Notes: |
(1) Contracts are
defined as new contracts signed during the period for the purchase
of homes, less cancellations of prior contracts. |
(2) Represents
home deliveries, home revenues and average prices for our
unconsolidated homebuilding joint ventures for the period. We
provide this data as a supplement to our consolidated results as an
indicator of the volume managed in our unconsolidated homebuilding
joint ventures. Our proportionate share of the income or loss of
unconsolidated homebuilding and land development joint ventures is
reflected as a separate line item in our consolidated financial
statements under “Income from unconsolidated joint ventures”. |
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA EXCLUDES UNCONSOLIDATED
JOINT VENTURES) |
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Six Months Ended |
Six Months Ending |
Backlog |
|
|
April 30, |
April 30, |
April 30, |
|
|
|
2021 |
|
2020 |
% Change |
|
2021 |
|
2020 |
% Change |
|
2021 |
|
2020 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(NJ, PA) |
Home |
|
107 |
|
129 |
(17.1)% |
|
|
95 |
|
175 |
(45.7)% |
|
|
142 |
|
106 |
34.0% |
|
|
Dollars |
$83,618 |
$56,269 |
48.6% |
|
$59,902 |
$92,055 |
(34.9)% |
|
$105,828 |
$50,771 |
108.4% |
|
|
Avg. Price |
$781,477 |
$436,194 |
79.2% |
|
$630,547 |
$526,029 |
19.9% |
|
$745,268 |
$478,972 |
55.6% |
|
Mid-Atlantic |
|
|
|
|
|
|
|
|
|
|
(DE, MD, VA, WV) |
Home |
|
471 |
|
430 |
9.5% |
|
|
392 |
|
323 |
21.4% |
|
|
585 |
|
429 |
36.4% |
|
|
Dollars |
$296,718 |
$222,354 |
33.4% |
|
$205,035 |
$177,266 |
15.7% |
|
$350,183 |
$228,622 |
53.2% |
|
|
Avg. Price |
$629,975 |
$517,102 |
21.8% |
|
$523,048 |
$548,811 |
(4.7)% |
|
$598,603 |
$532,918 |
12.3% |
|
Midwest |
|
|
|
|
|
|
|
|
|
|
(IL, OH) |
Home |
|
463 |
|
361 |
28.3% |
|
|
386 |
|
343 |
12.5% |
|
|
673 |
|
468 |
43.8% |
|
|
Dollars |
$159,927 |
$112,777 |
41.8% |
|
$120,603 |
$102,935 |
17.2% |
|
$208,841 |
$132,523 |
57.6% |
|
|
Avg. Price |
$345,417 |
$312,402 |
10.6% |
|
$312,443 |
$300,102 |
4.1% |
|
$310,314 |
$283,169 |
9.6% |
|
Southeast |
|
|
|
|
|
|
|
|
|
|
(FL, GA, SC) |
Home |
|
363 |
|
264 |
37.5% |
|
|
269 |
|
224 |
20.1% |
|
|
392 |
|
287 |
36.6% |
|
|
Dollars |
$164,679 |
$115,666 |
42.4% |
|
$126,511 |
$92,997 |
36.0% |
|
$185,139 |
$131,695 |
40.6% |
|
|
Avg. Price |
$453,661 |
$438,129 |
3.5% |
|
$470,301 |
$415,165 |
13.3% |
|
$472,293 |
$458,868 |
2.9% |
|
Southwest |
|
|
|
|
|
|
|
|
|
|
(AZ, TX) |
Home |
|
1,565 |
|
1,110 |
41.0% |
|
|
1,215 |
|
1,008 |
20.5% |
|
|
1,416 |
|
765 |
85.1% |
|
|
Dollars |
$587,443 |
$365,926 |
60.5% |
|
$407,347 |
$334,188 |
21.9% |
|
$540,321 |
$262,634 |
105.7% |
|
|
Avg. Price |
$375,363 |
$329,663 |
13.9% |
|
$335,265 |
$331,536 |
1.1% |
|
$381,583 |
$343,312 |
11.1% |
|
West |
|
|
|
|
|
|
|
|
|
|
(CA) |
Home |
|
580 |
|
515 |
12.6% |
|
|
646 |
|
488 |
32.4% |
|
|
689 |
|
328 |
110.1% |
|
|
Dollars |
$325,685 |
$230,250 |
41.4% |
|
$311,482 |
$203,139 |
53.3% |
|
$384,089 |
$151,812 |
153.0% |
|
|
Avg. Price |
$561,524 |
$447,087 |
25.6% |
|
$482,170 |
$416,268 |
15.8% |
|
$557,459 |
$462,841 |
20.4% |
|
Consolidated Total |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
3,549 |
|
2,809 |
26.3% |
|
|
3,003 |
|
2,561 |
17.3% |
|
|
3,897 |
|
2,383 |
63.5% |
|
|
Dollars |
$1,618,070 |
$1,103,242 |
46.7% |
|
$1,230,880 |
$1,002,580 |
22.8% |
|
$1,774,401 |
$958,057 |
85.2% |
|
|
Avg. Price |
$455,923 |
$392,753 |
16.1% |
|
$409,883 |
$391,480 |
4.7% |
|
$455,325 |
$402,038 |
13.3% |
|
Unconsolidated Joint Ventures (2) |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
373 |
|
325 |
14.8% |
|
|
274 |
|
337 |
(18.7)% |
|
|
476 |
|
303 |
57.1% |
|
|
Dollars |
$211,713 |
$189,807 |
11.5% |
|
$162,180 |
$198,545 |
(18.3)% |
|
$266,673 |
$175,817 |
51.7% |
|
|
Avg. Price |
$567,598 |
$584,022 |
(2.8)% |
|
$591,898 |
$589,154 |
0.5% |
|
$560,237 |
$580,254 |
(3.4)% |
|
Grand Total |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
3,922 |
|
3,134 |
25.1% |
|
|
3,277 |
|
2,898 |
13.1% |
|
|
4,373 |
|
2,686 |
62.8% |
|
|
Dollars |
$1,829,783 |
$1,293,049 |
41.5% |
|
$1,393,060 |
$1,201,125 |
16.0% |
|
$2,041,074 |
$1,133,874 |
80.0% |
|
|
Avg. Price |
$466,544 |
$412,587 |
13.1% |
|
$425,102 |
$414,467 |
2.6% |
|
$466,745 |
$422,142 |
10.6% |
|
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
359 |
|
379 |
(5.3)% |
|
|
0 |
|
0 |
0.0% |
|
|
1,451 |
|
581 |
149.7% |
|
|
Dollars |
$56,178 |
$59,234 |
(5.2)% |
|
$0 |
$0 |
0.0% |
|
$227,851 |
$91,551 |
148.9% |
|
|
Avg. Price |
$156,485 |
$156,290 |
0.1% |
|
$0 |
$0 |
0.0% |
|
$157,030 |
$157,575 |
(0.3)% |
|
|
DELIVERIES INCLUDE EXTRAS |
Notes: |
(1) Contracts are
defined as new contracts signed during the period for the purchase
of homes, less cancellations of prior contracts. |
(2) Represents
home deliveries, home revenues and average prices for our
unconsolidated homebuilding joint ventures for the period. We
provide this data as a supplement to our consolidated results as an
indicator of the volume managed in our unconsolidated homebuilding
joint ventures. Our proportionate share of the income or loss of
unconsolidated homebuilding and land development joint ventures is
reflected as a separate line item in our consolidated financial
statements under “Income from unconsolidated joint ventures”. |
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA UNCONSOLIDATED JOINT VENTURES ONLY) |
(UNAUDITED) |
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Three Months Ended |
Three Months Ended |
Backlog |
|
|
April 30, |
April 30, |
April 30, |
|
|
|
2021 |
|
|
2020 |
% Change |
|
2021 |
|
2020 |
% Change |
|
2021 |
|
2020 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
14 |
|
|
34 |
(58.8)% |
|
|
17 |
|
56 |
(69.6)% |
|
|
14 |
|
61 |
(77.0)% |
|
(excluding KSA JV) |
Dollars |
$16,977 |
|
$25,083 |
(32.3)% |
|
$23,813 |
$48,259 |
(50.7)% |
|
$17,839 |
$48,707 |
(63.4)% |
|
(NJ, PA) |
Avg. Price |
$1,212,643 |
|
$737,735 |
64.4% |
|
$1,400,765 |
$861,768 |
62.5% |
|
$1,274,214 |
$798,475 |
59.6% |
|
Mid-Atlantic |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
26 |
|
|
17 |
52.9% |
|
|
33 |
|
19 |
73.7% |
|
|
127 |
|
45 |
182.2% |
|
(DE, MD, VA, WV) |
Dollars |
$14,962 |
|
$8,609 |
73.8% |
|
$17,923 |
$9,536 |
88.0% |
|
$75,401 |
$23,133 |
225.9% |
|
|
Avg. Price |
$575,462 |
|
$506,412 |
13.6% |
|
$543,121 |
$501,895 |
8.2% |
|
$593,709 |
$514,067 |
15.5% |
|
Midwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
0 |
|
|
4 |
(100.0)% |
|
|
0 |
|
6 |
(100.0)% |
|
|
0 |
|
3 |
(100.0)% |
|
(IL, OH) |
Dollars |
$0 |
|
$1,754 |
(100.0)% |
|
$0 |
$2,859 |
(100.0)% |
|
$0 |
$1,363 |
(100.0)% |
|
|
Avg. Price |
$0 |
|
$438,500 |
(100.0)% |
|
$0 |
$476,667 |
(100.0)% |
|
$0 |
$454,333 |
(100.0)% |
|
Southeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
127 |
|
|
82 |
54.9% |
|
|
70 |
|
60 |
16.7% |
|
|
272 |
|
137 |
98.5% |
|
(FL, GA, SC) |
Dollars |
$69,362 |
|
$37,309 |
85.9% |
|
$33,510 |
$27,678 |
21.1% |
|
$145,096 |
$68,550 |
111.7% |
|
|
Avg. Price |
$546,157 |
|
$454,988 |
20.0% |
|
$478,714 |
$461,300 |
3.8% |
|
$533,441 |
$500,365 |
6.6% |
|
Southwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
0 |
|
|
10 |
(100.0)% |
|
|
14 |
|
27 |
(48.1)% |
|
|
21 |
|
46 |
(54.3)% |
|
(AZ, TX) |
Dollars |
$(17) |
|
$7,421 |
(100.2)% |
|
$8,441 |
$17,026 |
(50.4)% |
|
$12,758 |
$29,973 |
(57.4)% |
|
|
Avg. Price |
$0 |
|
$742,100 |
(100.0)% |
|
$602,929 |
$630,593 |
(4.4)% |
|
$607,524 |
$651,587 |
(6.8)% |
|
West |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
22 |
|
|
8 |
175.0% |
|
|
21 |
|
20 |
5.0% |
|
|
42 |
|
11 |
281.8% |
|
(CA) |
Dollars |
$8,522 |
|
$2,714 |
214.0% |
|
$7,380 |
$6,838 |
7.9% |
|
$15,579 |
$4,091 |
280.8% |
|
|
Avg. Price |
$387,364 |
|
$339,250 |
14.2% |
|
$351,429 |
$341,900 |
2.8% |
|
$370,929 |
$371,909 |
(0.3)% |
|
Unconsolidated Joint Ventures (2) |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
189 |
|
|
155 |
21.9% |
|
|
155 |
|
188 |
(17.6)% |
|
|
476 |
|
303 |
57.1% |
|
|
Dollars |
$109,806 |
|
$82,890 |
32.5% |
|
$91,067 |
$112,196 |
(18.8)% |
|
$266,673 |
$175,817 |
51.7% |
|
|
Avg. Price |
$580,984 |
|
$534,774 |
8.6% |
|
$587,529 |
$596,787 |
(1.6)% |
|
$560,237 |
$580,254 |
(3.4)% |
|
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
146 |
|
|
284 |
(48.6)% |
|
|
0 |
|
0 |
0.0% |
|
|
1,451 |
|
581 |
149.7% |
|
|
Dollars |
$22,805 |
|
$44,393 |
(48.6)% |
|
$0 |
$0 |
0.0% |
|
$227,851 |
$91,551 |
148.9% |
|
|
Avg. Price |
$156,199 |
|
$156,317 |
(0.1)% |
|
$0 |
$0 |
0.0% |
|
$157,030 |
$157,575 |
(0.3)% |
|
|
DELIVERIES INCLUDE EXTRAS |
Notes: |
(1) Contracts are
defined as new contracts signed during the period for the purchase
of homes, less cancellations of prior contracts. |
(2) Represents
home deliveries, home revenues and average prices for our
unconsolidated homebuilding joint ventures for the period. We
provide this data as a supplement to our consolidated results as an
indicator of the volume managed in our unconsolidated homebuilding
joint ventures. Our proportionate share of the income or loss of
unconsolidated homebuilding and land development joint ventures is
reflected as a separate line item in our consolidated financial
statements under “Income from unconsolidated joint ventures”. |
HOVNANIAN
ENTERPRISES, INC. |
(DOLLARS
IN THOUSANDS EXCEPT AVG. PRICE) |
(SEGMENT
DATA UNCONSOLIDATED JOINT VENTURES ONLY) |
(UNAUDITED) |
|
|
|
Contracts (1) |
Deliveries |
Contract |
|
|
Six Months Ended |
Six Months Ended |
Backlog |
|
|
April 30, |
April 30, |
April 30, |
|
|
|
2021 |
|
2020 |
% Change |
|
2021 |
|
2020 |
% Change |
|
2021 |
|
2020 |
% Change |
Northeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
27 |
|
91 |
(70.3)% |
|
|
31 |
|
106 |
(70.8)% |
|
|
14 |
|
61 |
(77.0)% |
|
(excluding KSA JV) |
Dollars |
$34,812 |
$70,383 |
(50.5)% |
|
$41,508 |
$85,355 |
(51.4)% |
|
$17,839 |
$48,707 |
(63.4)% |
|
(NJ, PA) |
Avg. Price |
$1,289,333 |
$773,440 |
66.7% |
|
$1,338,968 |
$805,236 |
66.3% |
|
$1,274,214 |
$798,475 |
59.6% |
|
Mid-Atlantic |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
49 |
|
34 |
44.1% |
|
|
63 |
|
31 |
103.2% |
|
|
127 |
|
45 |
182.2% |
|
(DE, MD, VA, WV) |
Dollars |
$28,288 |
$17,874 |
58.3% |
|
$32,324 |
$15,716 |
105.7% |
|
$75,401 |
$23,133 |
225.9% |
|
|
Avg. Price |
$577,306 |
$525,706 |
9.8% |
|
$513,079 |
$506,968 |
1.2% |
|
$593,709 |
$514,067 |
15.5% |
|
Midwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
1 |
|
10 |
(90.0)% |
|
|
1 |
|
10 |
(90.0)% |
|
|
0 |
|
3 |
(100.0)% |
|
(IL, OH) |
Dollars |
$409 |
$4,648 |
(91.2)% |
|
$409 |
$4,569 |
(91.0)% |
|
$0 |
$1,363 |
(100.0)% |
|
|
Avg. Price |
$409,000 |
$464,800 |
(12.0)% |
|
$409,000 |
$456,900 |
(10.5)% |
|
$0 |
$454,333 |
(100.0)% |
|
Southeast |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
244 |
|
119 |
105.0% |
|
|
121 |
|
105 |
15.2% |
|
|
272 |
|
137 |
98.5% |
|
(FL, GA, SC) |
Dollars |
$127,120 |
$58,704 |
116.5% |
|
$60,552 |
$50,727 |
19.4% |
|
$145,096 |
$68,550 |
111.7% |
|
|
Avg. Price |
$520,984 |
$493,311 |
5.6% |
|
$500,430 |
$483,114 |
3.6% |
|
$533,441 |
$500,365 |
6.6% |
|
Southwest |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
4 |
|
45 |
(91.1)% |
|
|
29 |
|
44 |
(34.1)% |
|
|
21 |
|
46 |
(54.3)% |
|
(AZ, TX) |
Dollars |
$3,135 |
$29,219 |
(89.3)% |
|
$17,180 |
$27,565 |
(37.7)% |
|
$12,758 |
$29,973 |
(57.4)% |
|
|
Avg. Price |
$783,750 |
$649,311 |
20.7% |
|
$592,414 |
$626,477 |
(5.4)% |
|
$607,524 |
$651,587 |
(6.8)% |
|
West |
|
|
|
|
|
|
|
|
|
|
(unconsolidated joint ventures) |
Home |
|
48 |
|
26 |
84.6% |
|
|
29 |
|
41 |
(29.3)% |
|
|
42 |
|
11 |
281.8% |
|
(CA) |
Dollars |
$17,949 |
$8,979 |
99.9% |
|
$10,207 |
$14,613 |
(30.2)% |
|
$15,579 |
$4,091 |
280.8% |
|
|
Avg. Price |
$373,938 |
$345,346 |
8.3% |
|
$351,966 |
$356,415 |
(1.2)% |
|
$370,929 |
$371,909 |
(0.3)% |
|
Unconsolidated Joint Ventures (2) |
|
|
|
|
|
|
|
|
|
|
(excluding KSA JV) |
Home |
|
373 |
|
325 |
14.8% |
|
|
274 |
|
337 |
(18.7)% |
|
|
476 |
|
303 |
57.1% |
|
|
Dollars |
$211,713 |
$189,807 |
11.5% |
|
$162,180 |
$198,545 |
(18.3)% |
|
$266,673 |
$175,817 |
51.7% |
|
|
Avg. Price |
$567,595 |
$584,022 |
(2.8)% |
|
$591,898 |
$589,154 |
0.5% |
|
$560,237 |
$580,254 |
(3.4)% |
|
|
KSA JV Only |
|
|
|
|
|
|
|
|
|
|
|
Home |
|
359 |
|
379 |
(5.3)% |
|
|
0 |
|
0 |
0.0% |
|
|
1,451 |
|
581 |
149.7% |
|
|
Dollars |
$56,178 |
$59,234 |
(5.2)% |
|
$0 |
$0 |
0.0% |
|
$227,851 |
$91,551 |
148.9% |
|
|
Avg. Price |
$156,485 |
$156,290 |
0.1% |
|
$0 |
$0 |
0.0% |
|
$157,030 |
$157,575 |
(0.3)% |
|
|
DELIVERIES INCLUDE EXTRAS |
Notes: |
(1) Contracts are
defined as new contracts signed during the period for the purchase
of homes, less cancellations of prior contracts. |
(2) Represents
home deliveries, home revenues and average prices for our
unconsolidated homebuilding joint ventures for the period. We
provide this data as a supplement to our consolidated results as an
indicator of the volume managed in our unconsolidated homebuilding
joint ventures. Our proportionate share of the income or loss of
unconsolidated homebuilding and land development joint ventures is
reflected as a separate line item in our consolidated financial
statements under “Income from unconsolidated joint ventures”. |
|
|
|
Contact: |
J. Larry Sorsby |
Jeffrey T. O’Keefe |
|
Executive Vice President & CFO |
Vice President, Investor Relations |
|
732-747-7800 |
732-747-7800 |
|
|
|
Hovnanian Enterprises (NYSE:HOV)
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