Beazer Homes Reports Record Third Fiscal Quarter EPS of $4.31, up 43%; Company Raises EPS Outlook for Fiscal Year 2004.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, 2004, reporting an all-time record for quarterly earnings per share. Highlights of the quarter, compared to the same period of the prior year, are as follows: Quarter Ended June 30, 2004 --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. : $4.31 (up 43.2% vs. $3.01 in prior year) --Home closings: 4,061 (up 12.3%) --Total revenues: $1,009.3 million (up 30.8%) --Gross profit from home construction: $195.1 million (up 37.7%) --Gross margin from home construction: 19.7% (up 70 basis points) --Operating income: $96.2 million (up 45.9%) --Operating income margin: 9.5% (up 100 basis points) --Net income: $59.7 million (up 46.7%) --New orders: 4,869 (up 2.9%) --Backlog at 6/30/04: 9,278 homes (up 8.2%), sales value $2.3 billion (up 29.3%) --Active Subdivisions at 6/30/04: 507 (up 3.7%) Record Earnings for June Quarter Ian J. McCarthy, President and Chief Executive Officer, said, "We are very pleased to announce record financial results for our third quarter of fiscal 2004. Our June quarter home closings and revenues increased 12% and 31%, respectively, indicating 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 Beazer Homes' strong position in the market. Our June quarter net income and earnings per share both represent all-time quarterly records, increasing 47% and 43%, respectively, from the prior year. These strong results illustrate our ongoing commitment to achieving profitable growth by leveraging our size, scale and geographic reach through our national brand." "Beazer Homes' backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. now stands at an all-time record level of 9,278 homes with a sales value of $2.3 billion, providing excellent visibility as we move forward into the final quarter of fiscal 2004 and fiscal 2005," added McCarthy. Strong Financial Position Continues in June Quarter "Beazer Homes' financial position remained strong during the third fiscal quarter," 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 45%, with a cash position of $199.6 million. Our newly increased bank credit facility and recent successful completion of a convertible senior notes offering provide us with substantially increased liquidity to further 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 growth opportunities available to us. We achieved not only record earnings and improved margins this quarter, but also a return on average equity for the twelve months ended June 30, 2004 of 20.6%, representing a 190 basis point improvement from the same period a year ago. These financial results reflect our commitment to improved profitability and sustained growth within our diverse geographic footprint The amount of geographic space covered by an object. A computer footprint is the desk or floor surface it occupies. A satellite's footprint is the earth area covered by its downlink. See form factor. 1. through focused product expansion and 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. ." During the third fiscal quarter of 2004, the Company realized increases over the prior year in its home construction 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 as the Company continued to realize benefits from the execution of its profit improvement initiatives and a strong pricing environment in several markets. These improvements were offset in part by increased marketing expenses of approximately $2.7 million associated with the Company's branding initiative and ongoing costs of approximately $10.0 million for warranty and legal costs associated with construction defect defect - bug claims from water intrusion at one of its Midwest divisions. In the prior year third fiscal quarter, the Company incurred a $7.6 million pre-tax charge associated with the retirement of $100 million of senior notes completed in June 2003. Beazer Homes Executes on Share Repurchase Plan share repurchase plan A corporation's plan for buying back a predetermined number of its own shares in the open market. Institution of a share repurchase plan derives from management's view that the company has limited outside investment opportunities and During the quarter ended June 30, 2004, the Company repurchased 179,800 shares of its common stock for approximately $17.5 million. These repurchases were made under the Company's previously announced stock repurchase plan stock repurchase plan 1. See buyback. 2. See self-tender. authorized au·thor·ize tr.v. au·thor·ized, au·thor·iz·ing, au·thor·iz·es 1. To grant authority or power to. 2. To give permission for; sanction: by the Board of Directors in February 2003. To date, 307,800 shares have been repurchased under the one million share authorization The right or permission to use a system resource; the process of granting access. See access control. . Beazer Homes Targets EPS of $16.50 - $16.75 in Fiscal 2004 "Our performance for the nine months ended June 30, 2004, combined with record backlog and our expectations of continued strength in the housing market provide us confidence in our future growth opportunities," said McCarthy. "In addition, we expect continued execution on our strategic initiatives that leverage our national brand, capitalize on our broad geographic profile through focused product expansion and price-point diversification, and also drive best practices to achieve optimal efficiencies, will place us in a strong position for continued growth. Absent any unanticipated adverse changes, we are raising our outlook for 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 to be in the range of $16.50 - $16.75 in fiscal 2004." Beazer Homes USA, Inc., headquartered in Atlanta is one of the country's ten largest single-family homebuilders with operations in Arizona Arizona (âr'əzō`nə), state in the southwestern United States. It is bordered by Utah (N), New Mexico (E), Mexico (S), and, across the Colorado R., Nevada and California (W). , California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). , Colorado, Delaware Delaware, state, United States Delaware (dĕl`əwâr, –wər), one of the Middle Atlantic states of the United States, the country's second smallest state (after Rhode Island). , Florida, Georgia Georgia, country, Asia Georgia (jôr`jə), Georgian Sakartvelo, Rus. Gruziya, officially Republic of Georgia, republic (2005 est. pop. 4,677,000), c.26,900 sq mi (69,700 sq km), in W Transcaucasia. , Indiana Indiana, state, United States Indiana, midwestern state in the N central United States. It is bordered by Lake Michigan and the state of Michigan (N), Ohio (E), Kentucky, across the Ohio R. (S), and Illinois (W). , Kentucky, Maryland, Mississippi, Nevada, New Jersey, 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, 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 Virginia. Beazer Homes 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. 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 will not achieve desired results, and other factors described in the Company's Form S-4/A filed with the Securities and Exchange Commission on April 9, 2004 and Annual Report and 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, 2003.
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,
---------------------- -----------------------
2004 2003 2004 2003
----------- ---------- ----------- -----------
INCOME STATEMENT
Revenues $1,009,279 $771,758 $2,695,968 $2,137,485
Costs and expenses:
Home construction and
land sales 801,865 612,602 2,145,834 1,704,052
Selling, general and
administrative expense 111,176 85,618 300,400 239,342
Expenses related to
retirement of debt - 7,570 - 7,570
----------- ---------- ----------- -----------
Operating income 96,238 65,968 249,734 186,521
Other income 1,599 1,287 5,551 4,523
----------- ---------- ----------- -----------
Income before income
taxes 97,837 67,255 255,285 191,044
Income taxes 38,157 26,566 99,561 75,463
----------- ---------- ----------- -----------
Net income 59,680 40,689 155,724 115,581
=========== ========== =========== ===========
Net income per common
share:
Basic $4.48 $3.16 $11.70 $9.01
=========== ========== =========== ===========
Diluted $4.31 $3.01 $11.25 $8.59
=========== ========== =========== ===========
Weighted average shares
outstanding, in thousands:
Basic 13,320 12,857 13,311 12,828
Diluted 13,843 13,530 13,845 13,454
Interest incurred $19,469 $16,120 $54,872 $49,618
Interest amortized to
cost of sales $17,309 $14,049 $46,183 $38,149
Depreciation and
amortization $4,065 $3,913 $12,100 $9,597
SELECTED BALANCE SHEET DATA June 30,
2004 2003
----------- ----------
Cash $199,627 $15,356
Inventory 2,352,869 1,654,356
Total assets 2,976,031 2,040,773
Total debt 1,124,067 741,104
Shareholders' equity 1,137,683 925,966
BEAZER HOMES USA, INC.
CONSOLIDATED OPERATING AND FINANCIAL DATA (Continued)
(Dollars in thousands)
OPERATING DATA
------------------------------
Quarter Ended Nine Months Ended
June 30, June 30,
----------------------- ---------------
SELECTED OPERATING DATA 2004 2003 2004 2003
----------- ----------- ------- -------
Closings:
Southeast region 1,340 1,204 3,794 3,390
West region 1,562 1,174 4,180 3,309
Central region 216 296 664 834
Mid-Atlantic region 409 261 1,094 789
Midwest region 534 681 1,621 2,073
----------- ----------- ------- -------
Total closings 4,061 3,616 11,353 10,395
=========== =========== ======= =======
New orders, net of
cancellations:
Southeast region 1,657 1,673 4,336 4,316
West region 1,823 1,474 5,162 3,690
Central region 297 332 833 860
Mid-Atlantic region 427 434 1,146 1,382
Midwest region 665 821 1,728 2,206
----------- ----------- ------- -------
Total new orders 4,869 4,734 13,205 12,454
=========== =========== ======= =======
Backlog units at end of period:
Southeast region 2,863 2,793
West region 3,269 2,214
Central region 565 533
Mid-Atlantic region 1,169 1,293
Midwest region 1,412 1,745
----------- -----------
Total backlog units 9,278 8,578
=========== ===========
Dollar value of backlog at end
of period $2,304,705 $1,781,936
=========== ===========
Active subdivisions:
Southeast region 189 187
West region 93 86
Central region 44 42
Mid-Atlantic region 55 39
Midwest region 126 135
----------- -----------
Total active subdivisions 507 489
=========== ===========
BEAZER HOMES USA, INC.
CONSOLIDATED OPERATING AND FINANCIAL DATA (Continued)
(Dollars in thousands)
Quarter Ended Nine Months Ended
June 30, June 30,
--------------------- -----------------------
SUPPLEMENTAL FINANCIAL
DATA: 2004 2003 2004 2003
----------- --------- ----------- -----------
Revenues
Home sales $989,961 $745,221 $2,636,896 $2,089,605
Land and lot sales 10,570 16,466 32,136 19,803
Mortgage origination
revenue 11,531 14,941 35,971 40,351
Intercompany
elimination -
mortgage (2,783) (4,870) (9,035) (12,274)
----------- --------- ----------- -----------
Total revenues $1,009,279 $771,758 $2,695,968 $2,137,485
=========== ========= =========== ===========
Cost of home construction
and land sales
Home sales $794,875 $603,549 $2,125,202 $1,699,754
Land and lot sales 9,773 13,923 29,667 16,572
Intercompany
elimination -
mortgage (2,783) (4,870) (9,035) (12,274)
----------- --------- ----------- -----------
Total costs of home
construction and land
sales $801,865 $612,602 $2,145,834 $1,704,052
=========== ========= =========== ===========
Selling, general and
administrative
Homebuilding
operations $103,403 $78,026 $277,510 $217,872
Mortgage origination
operations 7,773 7,592 22,890 21,470
----------- --------- ----------- -----------
Total selling, general
and administrative $111,176 $85,618 $300,400 $239,342
=========== ========= =========== ===========
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