Toll Brothers, Inc. (NYSE:TOL) (TollBrothers.com), the nation’s
leading builder of luxury homes, today announced results for its
first quarter ended January 31, 2024.
FY
2024’s First
Quarter Financial Highlights (Compared to FY
2023's First Quarter):
- Net income and
earnings per share were $239.6 million and $2.25 per diluted share,
compared to net income of $191.5 million and $1.70 per diluted
share in FY 2023’s first quarter.
- Pre-tax income
was $311.2 million, compared to $253.8 million in FY 2023’s first
quarter.
- Home sales
revenues were $1.93 billion, up 10% compared to FY 2023’s first
quarter; delivered homes were 1,927, up 6%.
- Net signed
contract value was $2.06 billion, up 42% compared to FY 2023’s
first quarter; contracted homes were 2,042, up 40%.
- Backlog value
was $7.08 billion at first quarter end, down 18% compared to FY
2023’s first quarter; homes in backlog were 6,693, down 13%.
- Home sales gross
margin was 27.6%, compared to FY 2023’s first quarter home sales
gross margin of 25.6%.
- Adjusted home
sales gross margin, which excludes interest and inventory
write-downs, was 28.9%, compared to FY 2023’s first quarter
adjusted home sales gross margin of 27.5%.
- SG&A, as a
percentage of home sales revenues, was 11.9%, compared to 12.1% in
FY 2023’s first quarter.
- Income from
operations was $308.4 million.
- Other income,
income from unconsolidated entities, and gross margin from land
sales and other was $8.6 million.
- Subsequent to
quarter-end, the Company sold a parcel of land to a commercial
developer for net cash proceeds of $180.7 million, which is
expected to result in a pre-tax land sale gain of approximately
$175 million in FY 2024's second quarter.
Douglas C. Yearley, Jr., chairman and chief
executive officer, stated: “We are very pleased with our strong
first quarter results. We delivered 1,927 homes at an average price
of approximately $1.0 million, generating home sales revenues of
$1.93 billion. Our adjusted gross margin in the quarter was 28.9%,
a 140-basis point increase compared to Q1 2023, and our SG&A
expense, as a percentage of home sales revenues, improved by 20
basis points year-over-year to 11.9%. This combination of top line
growth and greater operating efficiency led to earnings of $2.25
per diluted share in the quarter, a 32% increase over last year’s
first quarter.
“We experienced another quarter of solid demand.
We signed 2,042 net contracts for $2.06 billion, up 40% in units
and 42% in dollars compared to last year’s first quarter. Since
mid-January, we have seen a marked increase in demand coinciding
with the start of the spring selling season. With a healthy job
market, improving consumer sentiment, and continued low levels of
resale inventory, we are optimistic that demand for new homes will
remain strong in 2024.
“Based on our first quarter results, and with a
strong start to the spring selling season, we are raising our full
year guidance across all key metrics. In addition, earlier this
month we sold a parcel of land to a commercial developer for net
cash proceeds of $180.7 million, which will result in a pre-tax
land sale gain of approximately $175 million in our second quarter.
Factoring in both the increase to our homebuilding guidance and the
impact of the land sale, we now expect to earn between $13.25 and
$13.75 per diluted share in fiscal 2024, with a return on beginning
equity of approximately 21%.
“At the end of our first quarter we owned or
controlled approximately 70,400 lots, providing us with sufficient
land to increase community count over the next several years. Our
balance sheet is solid, we have ample liquidity, no significant
near-term debt maturities, and we expect to generate significant
cash flow from operations in fiscal 2024. This will enable us to
continue investing in our business while also returning cash to
stockholders throughout the year.”
Second
Quarter and FY 2024 Financial Guidance: |
|
Second Quarter |
|
Full Fiscal Year 2024 |
Deliveries |
2,400 to 2,500 units |
|
10,000 to 10,500 units |
Average Delivered Price per Home |
$1,000,000 to $1,010,000 |
|
$940,000 to $960,000 |
Adjusted Home Sales Gross Margin |
27.6% |
|
28.0% |
SG&A, as a Percentage of Home Sales Revenues |
9.7% |
|
9.8% |
Period-End Community Count |
385 |
|
410 |
Other Income, Income from Unconsolidated Entities, and Gross Margin
from Land Sales and Other* |
$180 million |
|
$260 million |
Tax Rate |
25.8% |
|
25.5% |
* Guidance for the second quarter and full year
includes an approximate $175 million gain on the sale of a parcel
of land.
Financial
Highlights for the three months ended January 31, 2024 and 2023
(unaudited): |
|
2024 |
|
2023 |
Net Income |
$239.6 million, or $2.25 per share diluted |
|
$191.5 million, or $1.70 per share diluted |
Pre-Tax Income |
$311.2 million |
|
$253.8 million |
Pre-Tax Inventory Impairments included in Home Sales Costs of
Revenues |
$1.5 million |
|
$8.0 million |
Home Sales Revenues |
$1.93 billion and 1,927 units |
|
$1.75 billion and 1,826 units |
Net Signed Contracts |
$2.06 billion and 2,042 units |
|
$1.45 billion and 1,461 units |
Net Signed Contracts per Community |
5.6 units |
|
4.3 units |
Quarter-End Backlog |
$7.08 billion and 6,693 units |
|
$8.58 billion and 7,733 units |
Average Price per Home in Backlog |
$1,058,000 |
|
$1,110,200 |
Home Sales Gross Margin |
27.6% |
|
25.6% |
Adjusted Home Sales Gross Margin |
28.9% |
|
27.5% |
Interest Included in Home Sales Cost of Revenues, as a percentage
of Home Sales Revenues |
1.2% |
|
1.4% |
SG&A, as a percentage of Home Sales Revenues |
11.9% |
|
12.1% |
Income from Operations |
$308.4 million, or 15.8% of total revenues |
|
$225.3 million, or 12.7% of total revenues |
Other Income, Income from Unconsolidated Entities, and Gross Margin
from Land Sales and Other |
$8.6 million |
|
$16.8 million |
Pre-Tax Land and Other Impairments included in Land Sales and Other
Costs of Revenues |
$— |
|
$13.0 million |
Quarterly Cancellations as a Percentage of Beginning-Quarter
Backlog |
2.9% |
|
3.0% |
Quarterly Cancellations as a Percentage of Signed Contracts in
Quarter |
8.6% |
|
14.3% |
|
|
|
|
Additional Information:
- The Company
ended its FY 2024 first quarter with approximately $754.8 million
in cash and cash equivalents, compared to $1.30 billion at FYE 2023
and $791.6 million at FY 2023’s first quarter end. At FY 2024 first
quarter end, the Company also had $1.8 billion available under its
$1.9 billion revolving credit facility, which is scheduled to
mature in February 2028.
- On
January 26, 2024, the Company paid its quarterly dividend of
$0.21 per share to shareholders of record at the close of business
on January 12, 2024.
- Stockholders'
Equity at FY 2024 first quarter end was $7.02 billion, compared to
$6.80 billion at FYE 2023.
- FY 2024's first
quarter-end book value per share was $67.29 per share, compared to
$65.49 at FYE 2023.
- The Company
ended its FY 2024's first quarter with a debt-to-capital ratio of
28.0%, compared to 29.6% at FY 2023’s fourth quarter end and 34.1%
at FY 2023's first quarter end. The Company ended FY 2024’s first
quarter with a net debt-to-capital ratio(1) of 21.4%, compared to
17.7% at FY 2023’s fourth quarter end, and 27.5% at FY 2023's first
quarter end.
- The Company
ended FY 2024’s first quarter with approximately 70,400 lots owned
and optioned, compared to 70,700 one quarter earlier, and 71,300
one year earlier. Approximately 51% or 36,000, of these lots were
owned, of which approximately 18,400 lots, including those in
backlog, were substantially improved.
- In the first
quarter of FY 2024, the Company spent approximately $463.2 million
on land to purchase approximately 2,620 lots.
- The Company
ended FY 2024’s first quarter with 377 selling communities,
compared to 370 at FY 2023’s fourth quarter end and 328 at FY
2023’s first quarter end.
(1) See “Reconciliation of Non-GAAP
Measures” below for more information on the calculation of the
Company’s net debt-to-capital ratio.
Toll Brothers will be broadcasting live via the
Investor Relations section of its website,
investors.TollBrothers.com, a conference call hosted by chairman
and chief executive officer Douglas C. Yearley, Jr. at 8:30 a.m.
(ET) Wednesday, February 21, 2024, to discuss these results and its
outlook for the second quarter and FY 2024. To access the call,
enter the Toll Brothers website, click on the Investor Relations
page, and select “Events & Presentations.” Participants are
encouraged to log on at least fifteen minutes prior to the start of
the presentation to register and download any necessary
software.
The call can be heard live with an online replay
which will follow.
ABOUT TOLL BROTHERSToll
Brothers, Inc., a Fortune 500 Company, is the nation's leading
builder of luxury homes. The Company was founded 57 years ago in
1967 and became a public company in 1986. Its common stock is
listed on the New York Stock Exchange under the symbol “TOL.” The
Company serves first-time, move-up, empty-nester, active-adult, and
second-home buyers, as well as urban and suburban renters. Toll
Brothers builds in over 60 markets in 24 states: Arizona,
California, Colorado, Connecticut, Delaware, Florida, Georgia,
Idaho, Illinois, Maryland, Massachusetts, Michigan, Nevada, New
Jersey, New York, North Carolina, Oregon, Pennsylvania, South
Carolina, Tennessee, Texas, Utah, Virginia, and Washington, as well
as in the District of Columbia. The Company operates its own
architectural, engineering, mortgage, title, land development,
insurance, smart home technology, and landscape subsidiaries. The
Company also develops master-planned and golf course communities as
well as operates its own lumber distribution, house component
assembly, and manufacturing operations.
In 2024, Toll Brothers marked 10 years in a row
being named to the Fortune World’s Most Admired Companies™ list.
Toll Brothers has also been named Builder of the Year by Builder
magazine and is the first two-time recipient of Builder of the Year
from Professional Builder magazine. For more information visit
TollBrothers.com.
Toll Brothers discloses information about its
business and financial performance and other matters, and provides
links to its securities filings, notices of investor events, and
earnings and other news releases, on the Investor Relations section
of its website (investors.TollBrothers.com).
From Fortune, ©2024 Fortune Media IP Limited.
All rights reserved. Used under license.
FORWARD-LOOKING STATEMENTS
Information presented herein for the first
quarter ended January 31, 2024 is subject to finalization of the
Company's regulatory filings, related financial and accounting
reporting procedures and external auditor procedures.
This release contains or may contain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. One can identify these
statements by the fact that they do not relate to matters of a
strictly historical or factual nature and generally discuss or
relate to future events. These statements contain words such as
“anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,”
“believe,” “may,” “can,” “could,” “might,” “should,” “likely,”
“will,” and other words or phrases of similar meaning. Such
statements may include, but are not limited to, information and
statements regarding: expectations regarding inflation and interest
rates; the markets in which we operate or may operate; our
strategic priorities; our land acquisition, land development and
capital allocation priorities; market conditions; demand for our
homes; our build-to-order and spec home strategy; anticipated
operating results and guidance; home deliveries; financial
resources and condition; changes in revenues; changes in
profitability; changes in margins; changes in accounting treatment;
cost of revenues, including expected labor and material costs;
selling, general, and administrative expenses; interest expense;
inventory write-downs; home warranty and construction defect
claims; unrecognized tax benefits; anticipated tax refunds; sales
paces and prices; effects of home buyer cancellations; growth and
expansion; joint ventures in which we are involved; anticipated
results from our investments in unconsolidated entities; our
ability to acquire or dispose of land and pursue real estate
opportunities; our ability to gain approvals and open new
communities; our ability to market, construct and sell homes and
properties; our ability to deliver homes from backlog; our ability
to secure materials and subcontractors; our ability to produce the
liquidity and capital necessary to conduct normal business
operations or to expand and take advantage of opportunities; and
the outcome of legal proceedings, investigations, and claims.
Any or all of the forward-looking statements
included in this release are not guarantees of future performance
and may turn out to be inaccurate. This can occur as a result of
incorrect assumptions or as a consequence of known or unknown risks
and uncertainties. The major risks and uncertainties – and
assumptions that are made – that affect our business and may cause
actual results to differ from these forward-looking statements
include, but are not limited to:
- the effect of
general economic conditions, including employment rates, housing
starts, inflation rates, interest and mortgage rates, availability
of financing for home mortgages and strength of the U.S.
dollar;
- market demand
for our products, which is related to the strength of the various
U.S. business segments and U.S. and international economic
conditions;
- the availability
of desirable and reasonably priced land and our ability to control,
purchase, hold and develop such land;
- access to
adequate capital on acceptable terms;
- geographic
concentration of our operations;
- levels of
competition;
- the price and
availability of lumber, other raw materials, home components and
labor;
- the effect of
U.S. trade policies, including the imposition of tariffs and duties
on home building products and retaliatory measures taken by other
countries;
- the effects of
weather and the risk of loss from earthquakes, volcanoes, fires,
floods, droughts, windstorms, hurricanes, pest infestations and
other natural disasters, and the risk of delays, reduced consumer
demand, unavailability of insurance, and shortages and price
increases in labor or materials associated with such natural
disasters;
- risks arising
from acts of war, terrorism or outbreaks of contagious diseases,
such as Covid-19;
- federal and
state tax policies;
- transportation
costs;
- the effect of
land use, environment and other governmental laws and
regulations;
- legal
proceedings or disputes and the adequacy of reserves;
- risks relating
to any unforeseen changes to or effects on liabilities, future
capital expenditures, revenues, expenses, earnings, indebtedness,
financial condition, losses and future prospects;
- the effect of
potential loss of key management personnel;
- changes in
accounting principles;
- risks related to
unauthorized access to our computer systems, theft of our and our
homebuyers’ confidential information or other forms of
cyber-attack; and
- other factors
described in “Risk Factors” included in our Annual Report on Form
10-K for the year ended October 31, 2023 and in subsequent filings
we make with the Securities and Exchange Commission (“SEC”).
Many of the factors mentioned above or in other
reports or public statements made by us will be important in
determining our future performance. Consequently, actual results
may differ materially from those that might be anticipated from our
forward-looking statements.
Forward-looking statements speak only as of the
date they are made. We undertake no obligation to publicly update
any forward-looking statements, whether as a result of new
information, future events, or otherwise.
For a further discussion of factors that we
believe could cause actual results to differ materially from
expected and historical results, see the information under the
captions “Risk Factors” and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” in our most
recent Annual Report on Form 10-K filed with the SEC and in
subsequent reports filed with the SEC. This discussion is provided
as permitted by the Private Securities Litigation Reform Act of
1995, and all of our forward-looking statements are expressly
qualified in their entirety by the cautionary statements contained
or referenced in this section.
TOLL BROTHERS, INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED BALANCE SHEETS |
(Amounts in thousands) |
|
|
January 31, 2024 |
|
October 31, 2023 |
|
(Unaudited) |
|
|
ASSETS |
|
|
|
Cash and cash equivalents |
$ |
754,793 |
|
|
$ |
1,300,068 |
|
Inventory |
|
9,581,482 |
|
|
|
9,057,578 |
|
Property, construction and
office equipment - net |
|
321,668 |
|
|
|
323,990 |
|
Receivables, prepaid expenses
and other assets |
|
702,030 |
|
|
|
691,256 |
|
Mortgage loans held for
sale |
|
73,270 |
|
|
|
110,555 |
|
Customer deposits held in
escrow |
|
92,901 |
|
|
|
84,530 |
|
Investments in unconsolidated
entities |
|
995,811 |
|
|
|
959,041 |
|
|
$ |
12,521,955 |
|
|
$ |
12,527,018 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
Liabilities: |
|
|
|
Loans payable |
$ |
1,064,149 |
|
|
$ |
1,164,224 |
|
Senior notes |
|
1,596,414 |
|
|
|
1,596,185 |
|
Mortgage company loan facility |
|
63,194 |
|
|
|
100,058 |
|
Customer deposits |
|
534,367 |
|
|
|
540,718 |
|
Accounts payable |
|
610,459 |
|
|
|
597,582 |
|
Accrued expenses |
|
1,463,546 |
|
|
|
1,548,781 |
|
Income taxes payable |
|
154,181 |
|
|
|
166,268 |
|
Total liabilities |
|
5,486,310 |
|
|
|
5,713,816 |
|
|
|
|
|
Equity: |
|
|
|
Stockholders’ Equity |
|
|
|
Common stock, 112,937 shares issued at January 31, 2024 and October
31, 2023 |
|
1,129 |
|
|
|
1,129 |
|
Additional paid-in capital |
|
685,941 |
|
|
|
698,548 |
|
Retained earnings |
|
6,892,821 |
|
|
|
6,675,719 |
|
Treasury stock, at cost — 8,627 and 9,146 shares at January 31,
2024 and October 31, 2023, respectively |
|
(597,632 |
) |
|
|
(619,150 |
) |
Accumulated other comprehensive income |
|
37,012 |
|
|
|
40,910 |
|
Total stockholders' equity |
|
7,019,271 |
|
|
|
6,797,156 |
|
Noncontrolling interest |
|
16,374 |
|
|
|
16,046 |
|
Total equity |
|
7,035,645 |
|
|
|
6,813,202 |
|
|
$ |
12,521,955 |
|
|
$ |
12,527,018 |
|
|
TOLL BROTHERS, INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(Amounts in thousands, except per share data and
percentages) |
(Unaudited) |
|
|
Three Months EndedJanuary 31, |
|
2024 |
|
2023 |
|
$ |
% |
|
$ |
% |
Revenues: |
|
|
|
|
|
Home sales |
$ |
1,931,836 |
|
|
|
$ |
1,749,422 |
|
|
Land sales and other |
|
16,012 |
|
|
|
|
30,747 |
|
|
|
|
1,947,848 |
|
|
|
|
1,780,169 |
|
|
|
|
|
|
|
|
Cost of revenues: |
|
|
|
|
|
Home sales |
|
1,399,226 |
|
72.4% |
|
|
1,300,923 |
|
74.4% |
Land sales and other |
|
10,161 |
|
63.5% |
|
|
42,435 |
|
138.0% |
|
|
1,409,387 |
|
|
|
|
1,343,358 |
|
|
|
|
|
|
|
|
Gross margin - home sales |
|
532,610 |
|
27.6% |
|
|
448,499 |
|
25.6% |
Gross margin - land sales and
other |
|
5,851 |
|
36.5% |
|
|
(11,688 |
) |
(38.0)% |
|
|
|
|
|
|
Selling, general and
administrative expenses |
|
230,046 |
|
11.9% |
|
|
211,497 |
|
12.1% |
Income from operations |
|
308,415 |
|
|
|
|
225,314 |
|
|
|
|
|
|
|
|
Other: |
|
|
|
|
|
Loss from unconsolidated
entities |
|
(9,172 |
) |
|
|
|
(4,433 |
) |
|
Other income - net |
|
11,918 |
|
|
|
|
32,915 |
|
|
Income before income
taxes |
|
311,161 |
|
|
|
|
253,796 |
|
|
Income tax provision |
|
71,603 |
|
|
|
|
62,266 |
|
|
Net income |
$ |
239,558 |
|
|
|
$ |
191,530 |
|
|
Per share: |
|
|
|
|
|
Basic earnings |
$ |
2.28 |
|
|
|
$ |
1.72 |
|
|
Diluted earnings |
$ |
2.25 |
|
|
|
$ |
1.70 |
|
|
Cash dividend declared |
$ |
0.21 |
|
|
|
$ |
0.20 |
|
|
Weighted-average number of
shares: |
|
|
|
|
|
Basic |
|
105,122 |
|
|
|
|
111,397 |
|
|
Diluted |
|
106,265 |
|
|
|
|
112,336 |
|
|
|
|
|
|
|
|
Effective tax rate |
|
23.0% |
|
|
|
|
24.5% |
|
|
|
|
|
|
|
|
|
|
|
|
TOLL BROTHERS, INC. AND SUBSIDIARIES |
SUPPLEMENTAL DATA |
(Amounts in thousands) |
(unaudited) |
|
|
Three Months EndedJanuary 31, |
|
2024 |
|
2023 |
Inventory impairments and
write-offs included in home sales cost of revenues: |
|
|
|
Pre-development costs and option write offs |
$ |
1,471 |
|
$ |
2,604 |
Land owned for future communities |
|
— |
|
|
— |
Land owned for operating communities |
|
— |
|
|
5,400 |
|
$ |
1,471 |
|
$ |
8,004 |
|
|
|
|
Land and other impairments
included in land sales and other cost of revenues |
$ |
— |
|
$ |
13,000 |
|
|
|
|
Depreciation and
amortization |
$ |
15,693 |
|
$ |
15,482 |
Interest incurred |
$ |
28,759 |
|
$ |
33,047 |
Interest expense: |
|
|
|
Charged to home sales cost of revenues |
$ |
23,578 |
|
$ |
25,080 |
Charged to land sales and other cost of revenues |
|
294 |
|
|
3,477 |
|
$ |
23,872 |
|
$ |
28,557 |
|
|
|
|
Home sites controlled: |
January 31, 2024 |
|
January 31, 2023 |
Owned |
|
36,014 |
|
|
36,912 |
Optioned |
|
34,435 |
|
|
34,346 |
|
|
70,449 |
|
|
71,258 |
Inventory at January 31, 2024 and October 31, 2023
consisted of the following (amounts in thousands):
|
January 31, 2024 |
|
October 31, 2023 |
Land and land development costs |
$ |
2,671,521 |
|
$ |
2,631,147 |
Construction in progress |
|
5,905,093 |
|
|
5,493,278 |
Model homes |
|
471,356 |
|
|
384,118 |
Land deposits and costs of
future development |
|
533,512 |
|
|
549,035 |
|
$ |
9,581,482 |
|
$ |
9,057,578 |
Toll Brothers operates in the following five
geographic segments, with current operations generally located in
the states listed below:
- North: Connecticut,
Delaware, Illinois, Massachusetts, Michigan, New Jersey, New York
and Pennsylvania
- Mid-Atlantic: Georgia, Maryland,
North Carolina, Tennessee and Virginia
- South: Florida, South Carolina and
Texas
- Mountain: Arizona, Colorado, Idaho, Nevada and Utah
- Pacific: California, Oregon and Washington
|
Three Months Ended January 31, |
|
Units |
|
$ (Millions) |
|
Average Price Per Unit $ |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
REVENUES |
|
|
|
|
|
|
|
|
|
|
|
North |
289 |
|
357 |
|
$ |
272.6 |
|
|
$ |
322.8 |
|
|
$ |
943,500 |
|
$ |
904,200 |
Mid-Atlantic |
277 |
|
166 |
|
|
264.1 |
|
|
|
189.1 |
|
|
$ |
953,600 |
|
$ |
1,139,100 |
South |
631 |
|
489 |
|
|
532.9 |
|
|
|
392.9 |
|
|
$ |
844,500 |
|
$ |
803,500 |
Mountain |
485 |
|
548 |
|
|
453.4 |
|
|
|
480.2 |
|
|
$ |
934,800 |
|
$ |
876,300 |
Pacific |
245 |
|
266 |
|
|
409.0 |
|
|
|
364.8 |
|
|
$ |
1,669,400 |
|
$ |
1,371,300 |
Home Building |
1,927 |
|
1,826 |
|
|
1,932.0 |
|
|
|
1,749.8 |
|
|
$ |
1,002,600 |
|
$ |
958,300 |
Corporate and other |
|
|
|
|
|
(0.2 |
) |
|
|
(0.4 |
) |
|
|
|
|
Total home sales |
1,927 |
|
1,826 |
|
|
1,931.8 |
|
|
|
1,749.4 |
|
|
$ |
1,002,500 |
|
$ |
958,000 |
Land sales and other |
|
|
|
|
|
16.0 |
|
|
|
30.7 |
|
|
|
|
|
Total Consolidated |
|
|
|
|
$ |
1,947.8 |
|
|
$ |
1,780.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTRACTS |
|
|
|
|
|
|
|
|
|
|
|
North |
325 |
|
328 |
|
$ |
328.8 |
|
|
$ |
315.2 |
|
|
$ |
1,011,700 |
|
$ |
961,000 |
Mid-Atlantic |
246 |
|
251 |
|
|
238.6 |
|
|
|
264.1 |
|
|
$ |
970,000 |
|
$ |
1,052,200 |
South |
575 |
|
415 |
|
|
469.9 |
|
|
|
328.5 |
|
|
$ |
817,200 |
|
$ |
791,600 |
Mountain |
541 |
|
299 |
|
|
498.9 |
|
|
|
263.9 |
|
|
$ |
922,200 |
|
$ |
882,600 |
Pacific |
355 |
|
168 |
|
|
528.6 |
|
|
|
282.6 |
|
|
$ |
1,488,900 |
|
$ |
1,681,800 |
Total Consolidated |
2,042 |
|
1,461 |
|
$ |
2,064.8 |
|
|
$ |
1,454.3 |
|
|
$ |
1,011,200 |
|
$ |
995,400 |
|
|
|
|
|
|
|
|
|
|
|
|
BACKLOG |
|
|
|
|
|
|
|
|
|
|
|
North |
992 |
|
1,093 |
|
$ |
1,020.5 |
|
|
$ |
1,112.5 |
|
|
$ |
1,028,700 |
|
$ |
1,017,900 |
Mid-Atlantic |
914 |
|
927 |
|
|
928.1 |
|
|
|
1,035.9 |
|
|
$ |
1,015,400 |
|
$ |
1,117,500 |
South |
2,256 |
|
2,449 |
|
|
2,030.8 |
|
|
|
2,289.7 |
|
|
$ |
900,200 |
|
$ |
934,900 |
Mountain |
1,633 |
|
2,275 |
|
|
1,624.2 |
|
|
|
2,383.7 |
|
|
$ |
994,600 |
|
$ |
1,047,800 |
Pacific |
898 |
|
989 |
|
|
1,477.5 |
|
|
|
1,763.0 |
|
|
$ |
1,645,300 |
|
$ |
1,782,600 |
Total Consolidated |
6,693 |
|
7,733 |
|
$ |
7,081.1 |
|
|
$ |
8,584.8 |
|
|
$ |
1,058,000 |
|
$ |
1,110,200 |
|
Unconsolidated entities:
Information related to revenues and contracts of entities in
which we have an interest for the three-month periods ended
January 31, 2024 and 2023, and for backlog at January 31,
2024 and 2023 is as follows:
|
Units |
|
$ (Millions) |
|
Average Price Per Unit $ |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Three months ended January
31, |
|
|
|
|
|
|
|
|
|
|
|
Revenues |
— |
|
3 |
|
$ |
— |
|
$ |
14.8 |
|
$ |
— |
|
$ |
4,860,300 |
Contracts |
22 |
|
23 |
|
$ |
21.6 |
|
$ |
32.9 |
|
$ |
980,900 |
|
$ |
1,431,300 |
|
|
|
|
|
|
|
|
|
|
|
|
Backlog at January 31, |
171 |
|
101 |
|
$ |
181.5 |
|
$ |
114.7 |
|
$ |
1,061,700 |
|
$ |
1,135,200 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF NON-GAAP
MEASURES
This press release contains, and Company
management’s discussion of the results presented in this press
release may include, information about the Company’s adjusted home
sales gross margin and the Company’s net debt-to-capital ratio.
These two measures are non-GAAP financial
measures which are not calculated in accordance with generally
accepted accounting principles (“GAAP”). These non-GAAP financial
measures should not be considered a substitute for, or superior to,
the comparable GAAP financial measures, and may be different from
non-GAAP measures used by other companies in the home building
business.
The Company’s management considers these
non-GAAP financial measures as we make operating and strategic
decisions and evaluate our performance, including against other
home builders that may use similar non-GAAP financial measures. The
Company’s management believes these non-GAAP financial measures are
useful to investors in understanding our operations and leverage
and may be helpful in comparing the Company to other home builders
to the extent they provide similar information.
Adjusted Home Sales Gross Margin The following
table reconciles the Company’s home sales gross margin as a
percentage of home sales revenues (calculated in accordance with
GAAP) to the Company’s adjusted home sales gross margin (a non-GAAP
financial measure). Adjusted home sales gross margin is calculated
as (i) home sales gross margin plus interest recognized in home
sales cost of revenues plus inventory write-downs recognized in
home sales cost of revenues divided by (ii) home sales
revenues.
Adjusted Home Sales Gross Margin
Reconciliation |
(Amounts in thousands, except percentages) |
|
|
|
Three Months EndedJanuary 31, |
|
|
2024 |
|
2023 |
Revenues - home
sales |
$ |
1,931,836 |
|
|
$ |
1,749,422 |
|
Cost of revenues -
home sales |
|
1,399,226 |
|
|
|
1,300,923 |
|
Home sales gross
margin |
|
532,610 |
|
|
|
448,499 |
|
Add: |
Interest recognized in cost of revenues - home sales |
|
23,578 |
|
|
|
25,080 |
|
|
Inventory impairments and write-offs in cost of revenues - home
sales |
|
1,471 |
|
|
|
8,004 |
|
Adjusted home
sales gross margin |
$ |
557,659 |
|
|
$ |
481,583 |
|
|
|
|
|
|
Home sales gross
margin as a percentage of home sale revenues |
|
27.6 |
% |
|
|
25.6 |
% |
|
|
|
|
|
Adjusted home
sales gross margin as a percentage of home sale revenues |
|
28.9 |
% |
|
|
27.5 |
% |
The Company’s management believes adjusted home
sales gross margin is a useful financial measure to investors
because it allows them to evaluate the performance of our home
building operations without the often varying effects of
capitalized interest costs and inventory impairments. The use of
adjusted home sales gross margin also assists the Company’s
management in assessing the profitability of our home building
operations and making strategic decisions regarding community
location and product mix.
Forward-looking Adjusted Home Sales Gross
MarginThe Company has not provided projected second quarter and
full FY 2024 home sales gross margin or a GAAP reconciliation for
forward-looking adjusted home sales gross margin because such
measure cannot be provided without unreasonable efforts on a
forward-looking basis, since inventory write-downs are based on
future activity and observation and therefore cannot be projected
for the second quarter and full FY 2024. The variability of these
charges may have a potentially unpredictable, and potentially
significant, impact on our second quarter and full FY 2024 home
sales gross margin.
Net Debt-to-Capital RatioThe following table
reconciles the Company’s ratio of debt to capital (calculated in
accordance with GAAP) to the Company’s net debt-to-capital ratio (a
non-GAAP financial measure). The net debt-to-capital ratio is
calculated as (i) total debt minus mortgage warehouse loans minus
cash and cash equivalents divided by (ii) total debt minus mortgage
warehouse loans minus cash and cash equivalents plus stockholders’
equity.
Net Debt-to-Capital Ratio Reconciliation |
(Amounts in thousands, except percentages) |
|
|
|
January 31, 2024 |
|
October 31, 2023 |
|
January 31, 2023 |
Loans payable |
$ |
1,064,149 |
|
|
$ |
1,164,224 |
|
|
$ |
1,145,646 |
|
Senior notes |
|
1,596,414 |
|
|
|
1,596,185 |
|
|
|
1,995,439 |
|
Mortgage company
loan facility |
|
63,194 |
|
|
|
100,058 |
|
|
|
71,187 |
|
Total debt |
|
2,723,757 |
|
|
|
2,860,467 |
|
|
|
3,212,272 |
|
Total
stockholders' equity |
|
7,019,271 |
|
|
|
6,797,156 |
|
|
|
6,201,347 |
|
Total capital |
$ |
9,743,028 |
|
|
$ |
9,657,623 |
|
|
$ |
9,413,619 |
|
Ratio of
debt-to-capital |
|
28.0 |
% |
|
|
29.6 |
% |
|
|
34.1 |
% |
|
|
|
|
|
|
|
Total debt |
$ |
2,723,757 |
|
|
$ |
2,860,467 |
|
|
$ |
3,212,272 |
|
Less: |
Mortgage company loan facility |
|
(63,194 |
) |
|
|
(100,058 |
) |
|
|
(71,187 |
) |
|
Cash and cash equivalents |
|
(754,793 |
) |
|
|
(1,300,068 |
) |
|
|
(791,609 |
) |
Total net
debt |
|
1,905,770 |
|
|
|
1,460,341 |
|
|
|
2,349,476 |
|
Total
stockholders' equity |
|
7,019,271 |
|
|
|
6,797,156 |
|
|
|
6,201,347 |
|
Total net
capital |
$ |
8,925,041 |
|
|
$ |
8,257,497 |
|
|
$ |
8,550,823 |
|
Net
debt-to-capital ratio |
|
21.4 |
% |
|
|
17.7 |
% |
|
|
27.5 |
% |
|
The Company’s management uses the net
debt-to-capital ratio as an indicator of its overall leverage and
believes it is a useful financial measure to investors in
understanding the leverage employed in the Company’s
operations.
A photo accompanying this announcement is available at
https://www.globenewswire.com/NewsRoom/AttachmentNg/ee0c4a32-3c9d-4d4a-b52a-323924fcfbe6
CONTACT: Frederick N. Cooper (215) 938-8312 |
fcooper@tollbrothers.com |
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