Beazer Homes Reports Record Fiscal Third Quarter Net Income up 89% and Dollar Value Backlog up 35%; Raises FY 2005 Outlook.ATLANTA -- Beazer Homes USA This article documents an lawsuit. Information may change rapidly as the suit progresses. . Beazer Homes USA (NYSE: BZH) is a Fortune 500 American homebuilding company based in Atlanta, Georgia. , Inc. (NYSE NYSE See: New York Stock Exchange : BZH BZH Breizh (French Brittany) BZH Big Zen Hugs ) (www.beazer.com) today announced results for the quarter and nine months ended June 30, 2005, reporting an all-time record for quarterly net income and earnings per share. Highlights of the quarter are as follows: Quarter Ended June 30, 2005 --Record diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. : $2.50 (up 76.1% vs. $1.42 in prior year) --Home closings: 4,631 (up 14.0%) --Total revenues: $1,293.2 million (up 28.1%) --Gross profit from home construction: $312.9 million (up 60.4%) --Gross margin from home construction: 24.8% (up 510 basis points) --Operating income: $178.6 million (up 85.6%) --Operating margin: 13.8% (up 430 basis points) --Net Income: $112.7 million (up 88.9%) --New orders: 5,202 homes (up 6.8%), sales value $1.49 billion (up 18.0%) --All-time record backlog at June 30, 2005: 10,635 homes (up 14.6%), sales value $3.12 billion (up 35.4%) --Active communities at June 30, 2005: 521 (up 2.8%) June Quarter Results "We are very pleased to announce record financial results for our third quarter of fiscal 2005. Our June quarter home closings and revenues increased 14.0% and 28.1%, respectively, and the sales value of our new orders increased 18.0%, reflecting continued strength and favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. conditions in the housing industry and for Beazer Homes," said President and Chief Executive Officer, Ian J. McCarthy. "Our June quarter net income and diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of both represent all-time quarterly records, increasing 88.9% and 76.1%, respectively, from the prior year. The fundamentals of our business continue to be robust and we are delivering on our commitment of achieving profitable growth by leveraging our size, scale and geographic reach through our national brand." "Beazer Homes' backlog stands at an all-time record level of 10,635 homes with a sales value of $3.12 billion, up 14.6% and 35.4%, respectively, from June 30, 2004. This sizeable backlog increase provides the basis for strong performance as we move forward into the final quarter of fiscal 2005 and enter fiscal 2006," added McCarthy. Total home closings of 4,631 were up 14% from the prior year, resulting from increases in the Southeast, West, Central and Mid-Atlantic regions, partially offset by lower closings in the Midwest region, namely in Indiana and Kentucky. The company experienced strong new order growth during the quarter in its Southeast, Central, Mid-Atlantic and Midwest regions which was partially offset by decreased orders in the West region. In the West region, strong order growth in Arizona, Colorado and Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, was offset by declines in Nevada and Northern California Northern California, sometimes referred to as NorCal, is the northern portion of the U.S. state of California. The region contains the San Francisco Bay Area, the state capital, Sacramento; as well as the substantial natural beauty of the redwood forests, the northern . The declines in these markets resulted primarily from certain entitlement issues which delayed community openings in addition to the company's overall focus on converting its existing backlog during the quarter. Strong Financial Performance in June Quarter "We achieved record earnings and significantly improved margins this quarter as our focus on profitable growth and accelerated closings yielded significant returns," said James O'Leary James O'Leary may refer to;
The total long-term debt and all types of equity of a company that constitutes its capital structure. total capitalization See capitalization. stood at 48.2%, in line with our target range, and our recent successful completion of both a $300 million senior notes offering in June and a $50 million add-on offering in July increased our ability to capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. the significant opportunities available to us by enhancing the liquidity required to further our corporate growth initiatives." During the third quarter of fiscal 2005, the company realized increases over the prior year in its home construction gross margin, total gross margin and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. margin of 510 basis points, 490 basis points and 430 basis points, respectively, as the company continued to realize benefits from the execution of its profit improvement initiatives. Margins were also favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. impacted by strong pricing in most major markets, as evidenced by the increase in the average sales price of closings and units in backlog to $272,700 and $293,500, respectively. In the prior year third fiscal quarter, the company incurred warranty costs associated with Trinity Homes, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , and increased marketing costs associated with the company's branding initiative, both totaling in the aggregate $12.7 million, and having an approximately 130 basis points impact on margin. Fiscal 2005 EPS Outlook "Our performance for the nine months ended June 30, 2005, combined with record backlog and expectations of continued strength in the housing market give us confidence in our future growth opportunities," said McCarthy. "In addition, we expect continued execution on our strategic initiatives that utilize our size, scale and capabilities to achieve greater profitability and increased market penetration Noun 1. market penetration - the extent to which a product is recognized and bought by customers in a particular market penetration - the act of entering into or through something; "the penetration of upper management by women" through focused product expansion, price point diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. and leveraging of our national brand. As such, we are raising our outlook for diluted earnings per share from a range of $7.00 - $7.25 to a range of $8.00 - $8.25 in fiscal 2005 before the goodwill impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. charge recorded in the second quarter but taking into account the charges associated with the class action settlement for Trinity Homes recorded in the first half of the year." Conference Call The company will hold a conference call today, July 28, 2005, at 11:00 AM ET to discuss the results and take questions. You may listen to the conference call and view the company's slide presentation over the internet by going to the "Investor Relations Investor relations The process by which the corporation communicates with its investors. " section of the company's website at www.beazer.com. To access the conference call by telephone, listeners should dial 800-369-1904. 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 866-367-5568 (available until 5:00 PM ET on August 5, 2005), or visit www.beazer.com. Beazer Homes USA, Inc., headquartered in Atlanta, is one of the country's ten largest single-family homebuilders with operations in Arizona, California, Colorado, Delaware, Florida, Georgia, Indiana, Kentucky, Maryland, Mississippi, Nevada, New Jersey, New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. , Ohio, Pennsylvania, South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15. , Tennessee, Texas, Virginia and West Virginia West Virginia, E central state of the United States. It is bordered by Pennsylvania and Maryland (N), Virginia (E and S), and Kentucky and, across the Ohio R., Ohio (W). Facts and Figures Area, 24,181 sq mi (62,629 sq km). Pop. and also provides mortgage origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real and title services to its homebuyers. Beazer Homes, a Fortune 500 company, is listed on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. under the ticker symbol Ticker Symbol An arrangement of characters (usually letters) representing a particular security listed on an exchange or otherwise traded publicly. When a company issues securities to the public marketplace, it selects an available ticker symbol for its securities which investors "BZH." Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially. Such risks, uncertainties and other factors include, but are not limited to, changes in general economic conditions, fluctuations in interest rates, increases in raw materials and labor costs, levels of competition, potential liability as a result of construction defect, product liability and warranty claims, the possibility that the company's improvement plan for the Midwest and strategies to broaden target price points and lessen less·en v. less·ened, less·en·ing, less·ens v.tr. 1. To make less; reduce. 2. Archaic To make little of; belittle. v.intr. To become less; decrease. dependence on the entry-level segment in certain markets will not achieve desired results, and other factors described in the company's Form S-3/A filed with the Securities and Exchange Commission on August 17, 2004, Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended September 30, 2004 and Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the quarter ended March 31, 2005.
BEAZER HOMES USA, INC.
CONSOLIDATED OPERATING AND FINANCIAL DATA
(Dollars in thousands, except per share amounts)
FINANCIAL DATA
--------------
Quarter Ended Nine Months Ended
June 30, June 30,
----------------------- -----------------------
2005 2004 2005 2004
----------- ----------- ----------- -----------
INCOME STATEMENT
Revenues $1,293,227 $1,009,279 $3,181,302 $2,695,968
Costs and expenses:
Home construction
and land sales 963,699 801,865 2,456,111 2,145,834
Selling, general
and
administrative
expense 150,891 111,176 363,555 300,400
Goodwill
impairment
charge (1) - - 130,235 -
----------- ----------- ----------- -----------
Operating income 178,637 96,238 231,401 249,734
Equity in income of
unconsolidated joint
ventures 2,951 813 3,150 1,748
Other income 987 786 4,987 3,803
----------- ----------- ----------- -----------
Income before income
taxes 182,575 97,837 239,538 255,285
Income taxes 69,835 38,157 141,438 99,561
----------- ----------- ----------- -----------
Net income $ 112,740 $ 59,680 $ 98,100 $ 155,724
=========== =========== =========== ===========
Net income per common
share (2):
Basic $ 2.78 $ 1.49 $ 2.43 $ 3.90
=========== =========== =========== ===========
Diluted $ 2.50 $ 1.42 $ 2.24 $ 3.74
=========== =========== =========== ===========
Weighted average
shares outstanding,
in thousands (2):
Basic 40,497 39,960 40,400 39,932
Diluted 45,666 42,350 45,510 41,740
Interest incurred $ 22,798 $ 19,469 $ 64,269 $ 54,872
Interest amortized to
cost of sales $ 21,568 $ 17,309 $ 54,880 $ 46,183
EPS interest add back
(net of taxes) -
Convertible Debt $ 1,331 $ 301 $ 3,993 $ 301
Depreciation and
amortization $ 5,676 $ 4,065 $ 15,311 $ 12,100
SELECTED BALANCE SHEET
DATA June 30,
2005 2004
----------- -----------
Cash $ 8,098 $ 199,627
Inventory 2,986,994 2,352,869
Total assets 3,467,666 2,976,031
Total debt 1,250,499 1,124,067
Shareholders' equity 1,333,879 1,137,683
(1) The non-cash goodwill impairment charge included in the nine
months ended June 30, 2005 is not tax deductible.
(2) Share and per share amounts for prior periods have been
retroactively adjusted to reflect the effect of the Company's March
2005 three-for-one stock split.
*T BEAZER HOMES USA, INC. CONSOLIDATED OPERATING AND FINANCIAL DATA (Continued) (Dollars in thousands) OPERATING DATA -------------- Quarter EndedNine Months Ended June 30,June 30, ----------------------- ----------------------- SELECTED OPERATING DATA2005200420052004 ----------- ----------- ----------- ----------- Closings: Southeast region1,4911,3403,9263,794 West region1,7741,5624,3244,180 Central region409216866664 Mid-Atlantic region4394091,1751,094 Midwest region5185341,5161,621 ----------- ----------- ----------- ----------- Total closings4,6314,06111,80711,353 =========== =========== =========== =========== New orders, net of cancellations: Southeast region1,8751,6574,7674,336 West region1,6071,8234,8635,162 Central region4162971,059833 Mid-Atlantic region5144271,5821,146 Midwest region7906651,7151,728 ----------- ----------- ----------- ----------- Total new orders5,2024,86913,98613,205 =========== =========== =========== =========== Backlog units at end of period: Southeast region3,4702,863 West region3,6793,269 Central region622565 Mid-Atlantic region1,4541,169 Midwest region1,4101,412 ----------- ----------- Total backlog units10,6359,278 =========== =========== Dollar value of backlog at end of period$3,121,702$2,304,705 =========== =========== Active subdivisions: Southeast region170189 West region10793 Central region4944 Mid-Atlantic region6255 Midwest region133126 ----------- ----------- Total active subdivisions521507 =========== =========== *T *T BEAZER HOMES USA, INC. CONSOLIDATED OPERATING AND FINANCIAL DATA (Continued) (Dollars in thousands) Quarter EndedNine Months Ended June 30,June 30, ----------------------- ----------------------- SUPPLEMENTAL FINANCIAL DATA:2005200420052004 ----------- ----------- ----------- ----------- Revenues Home sales$1,262,890$989,961$3,126,302$2,636,896 Land and lot sales20,78910,57029,76732,136 Mortgage origination revenue13,70811,53135,87235,971 Intercompany elimination - mortgage(4,160)(2,783)(10,639)(9,035) ----------- ----------- ----------- ----------- Total revenues$1,293,227$1,009,279$3,181,302$2,695,968 =========== =========== =========== =========== Cost of home construction and land sales Home sales$950,013$794,875$2,442,767$2,125,202 Land and lot sales17,8469,77323,98329,667 Intercompany elimination - mortgage(4,160)(2,783)(10,639)(9,035) ----------- ----------- ----------- ----------- Total costs of home construction and land sales$963,699$801,865$2,456,111$2,145,834 =========== =========== =========== =========== Selling, general and administrative Homebuilding operations$141,315$103,403$337,564$277,510 Mortgage origination operations9,5767,77325,99122,890 ----------- ----------- ----------- ----------- Total selling, general and administrative$150,891$111,176$363,555$300,400 =========== =========== =========== =========== *T |
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