8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): May 9, 2016

WILLIAM LYON HOMES

(Exact name of registrant as specified in charter)

Delaware	001-31625	33-0864902
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

4695 MacArthur Court, 8^th Floor

Newport Beach, California 92660

(Address of principal executive offices and zip code)

(949) 833-3600

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Conditions.

On May 9, 2016, William Lyon Homes (the “Company”) issued a press release announcing its financial results for the three months ended March 31, 2016. A copy of the press release is furnished herewith as Exhibit 99.1, and is incorporated herein by reference.

The information in this Current Report on Form 8-K, including the accompanying Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liability under that section, except as specifically incorporated by reference into the filings of the Company under the Securities Act of 1933, as amended, or the Exchange Act.

Item 7.01. Regulation FD Disclosure.

Senior management of the Company will reference the materials included in Exhibit 99.2 to this report (the “Earnings Presentation”) during an earnings conference call to be held at 10:00 a.m. Pacific Time on May 9, 2016. A copy of the Earnings Presentation is furnished as Exhibit 99.2 to this report.

In accordance with General Instruction B.2 of Form 8-K, the information in this Item 7.01, including the Earnings Presentation attached to this report as Exhibit 99.2, shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. The furnishing of the information in this report is not intended to, and does not, constitute a determination or admission by the Company that the information in this report is material or complete, or that investors should consider this information before making an investment decision with respect to any security of the Company. In addition, the Earnings Presentation furnished as an exhibit to this report may include “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

The following exhibits are furnished herewith:

99.1	Press Release issued on May 9, 2016 announcing financial results for the three months ended March 31, 2016.
99.2	Earnings Presentation.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	WILLIAM LYON HOMES
Dated: May 9, 2016	By:	/S/ COLIN T. SEVERN
		Colin T. Severn
		Senior Vice President
		Chief Financial Officer

EXHIBIT INDEX

Exhibit	Description
99.1	Press Release issued on May 9, 2016 announcing financial results for the three months ended March 31, 2016.
99.2	Earnings Presentation.

EX-99.1

Exhibit 99.1

WILLIAM LYON HOMES REPORTS FIRST QUARTER 2016 RESULTS

35% INCREASE IN NET INCOME AVAILABLE TO COMMON STOCKHOLDERS; 38% INCREASE IN HOMEBUILDING REVENUE; AND 41% INCREASE IN DOLLAR VALUE OF HOMES IN BACKLOG

NEWPORT BEACH, CA— May 9, 2016 — William Lyon Homes (NYSE: WLH), a leading homebuilder in the Western U.S., announced results for its 2016 first quarter ended March 31, 2016.

2016 First Quarter Highlights (Comparison to 2015 First Quarter)

• Net income available to common stockholders of $9.0 million, up 35%, or $0.24 per diluted share, up 32%

• Home sales revenue of $261.3 million, up 38%

• Consolidated revenue of $264.4 million, up 34%

• New home deliveries of 543 homes, up 40%

• Net new home orders of 689, up 17%

• Dollar value of orders of $334.5 million, up 25%

• Average sales locations of 69, up 28%

• Units in backlog of 885, up 31%

• Dollar value of homes in backlog of $471.7 million, up 41%

• Average sales price (ASP) of new homes delivered of $481,200

• Homebuilding gross margin of $46.1 million, up 29%

• Homebuilding gross margin percentage of 17.7%

• Adjusted homebuilding gross margin percentage of 24.7%

• SG&A percentage of 12.5%, compared to 13.8%

• Adjusted EBITDA of $33.5 million, up 46%

“We are very pleased to have started the year with continued positive operating momentum,” said Matthew R. Zaist, President and Chief Executive Officer. “Home sales revenue increased by 38% to $261.3 million and deliveries increased by 40% to 543 units, resulting in a 35% increase in net income available to common stockholders of $9.0 million, or $0.24 per diluted share. Our ongoing focus on our strategic initiatives resulted in continued year-over-year improvement in virtually all of our key operating and financial metrics.”

Mr. Zaist continued, “We delivered another quarter of year-over-year improvement in net new home orders, which increased by 17% to 689, and the number and dollar value of our backlog, which grew to 885 homes and $471.7 million, up 31% and 41%, respectively. We are experiencing an orderly progression of new home sales and absorption rates throughout the spring selling season, as orders picked up momentum on a month-over-month basis throughout the quarter. This momentum has continued into the second quarter of 2016, where April’s absorption pace was the strongest of the year at 4.3 net sales per community, resulting in 291 net new home orders for the month. We continue to focus on new community openings and currently expect to open approximately 17 new home communities during the second quarter, with the bulk of these openings occurring in May and June, and expect to end the second quarter of 2016 selling out of approximately 80 new home communities.”

Operating Results

Home sales revenue for the first quarter of 2016 was $261.3 million, as compared to $189.7 million in the year-ago period, an increase of 38%. Our performance was driven by a 40% increase in the number of deliveries to 543 homes, compared to 388 homes delivered in the first quarter of 2015. Average sales price of homes delivered was $481,200 in the quarter, compared to $489,000 in the year-ago period. The slight decline in ASP primarily reflects changes in geographic and product mix contributing to closings during the quarter.

The dollar value of orders for the first quarter of 2016 was $334.5 million, an increase of 25%, from $268.2 million in the year-ago period. Net new home orders for the quarter were 689, up 17% from 588 in the first quarter of 2015. The overall increase in net new home orders was primarily driven by an increase in community count to 69 average sales locations, from 54 in the year-ago period, offset by a modest decline in absorption from 3.6 sales per month in the year-ago period to 3.3 sales per month in the current period. For the quarter, we saw monthly absorption rates range from a low of 2.8 sales per community in January to a high of 3.8 sales per community in March.

The dollar value of homes in backlog was $471.7 million as of March 31, 2016, an increase of 41% compared to $335.1 million as of March 31, 2015. The increase was driven by both a 31% increase in units in backlog to 885 from 678 and an 8% increase in ASP in backlog to $533,000 from $494,200 in the year-ago period.

Adjusted homebuilding gross margin percentage was 24.7% during the first quarter of 2016. Homebuilding gross margins for the first quarter of 2016 were 17.7%.

Sales and marketing expense during the first quarter of 2016 was 5.7% of homebuilding revenue, compared to 6.4% in the year-ago quarter, driven primarily by higher homebuilding revenue and leverage on our advertising and marketing costs, compared to the prior year period. General and administrative expenses decreased to 6.8% of homebuilding revenue, compared to 7.4% in the year-ago quarter, as we benefitted from a lower relative cost structure due to positive operating leverage.

Balance Sheet Update

At quarter end, cash, cash equivalents and restricted cash totaled $36.3 million, real estate inventories totaled $1.8 billion, total assets were $2.0 billion and total equity was $714 million. Net debt to net book capitalization was 60.2%, and total debt to total book capitalization was 61.0% at March 31, 2016, compared to 61.1% and 62.2%, respectively, as of December 31, 2015.

Conference Call

The Company will host a conference call to discuss these results today, Monday, May 9, 2016 at 10:00 a.m. Pacific Time. The call will be available via both the telephone at (855) 851-4524 or (720) 634-2900, passcode #92396245, or through the Company’s website at www.lyonhomes.com in the Investor Relations section of the site. A replay of the call will be available through May 16, 2016 by dialing (855) 859-2056 or (404) 537-3406, passcode #92396245. A webcast replay of the call will also be available on the Company’s website approximately two hours after the broadcast.

About William Lyon Homes

William Lyon Homes is one of the largest Western U.S. regional homebuilders. Headquartered in Newport Beach, California, the Company is primarily engaged in the design, construction, marketing and sale of single-family detached and attached homes in California, Arizona, Nevada, Colorado, Washington and Oregon. Its core markets include Orange County, Los Angeles, the Inland Empire, the San Francisco Bay Area, Phoenix, Las Vegas, Denver, Seattle and Portland. The Company has a distinguished legacy of more than 60 years of homebuilding operations, over which time it has sold in excess of 96,000 homes. The Company markets and sells its homes under the William Lyon Homes brand in all of its markets except for Colorado, where the Company operates under the Village Homes brand, and Washington and Oregon, where the Company operates under the Polygon Northwest brand.

Certain statements contained in this release and the accompanying comments during our conference call that are not historical information may constitute “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995, including, but not limited to, forward-looking statements related to: community count growth, market and industry trends, the continued housing market recovery, operating results for the second quarter of 2016 and full year 2016, average sale price of homes to be closed in various periods, SG&A percentage, gross margins, future cash needs and liquidity, leverage ratios and reduction strategies, land acquisition spending and backlog conversion rates. The forward-looking statements involve risks and uncertainties and actual results may differ materially from those projected or implied. The Company makes no commitment, and disclaims any duty, to update or revise any forward-looking statements to reflect future events or changes in these expectations. Further, certain forward-looking statements are based on assumptions of future events which may not prove to be accurate. Factors that may impact such forward-looking statements include, among others: the availability of labor and homebuilding materials and increased construction cycle times; adverse weather conditions, including but not limited to the continued drought in California and the Southwest; our financial leverage and level of indebtedness and any inability to comply with financial and other covenants under our debt instruments; continued volatility and worsening in general economic conditions either internationally, nationally or in regions in which we operate; conditions in our newly entered markets and newly acquired operations; worsening in markets for residential housing; the impact of construction defect, product liability and home warranty claims, including the adequacy of self-insurance accruals, and the applicability and sufficiency of our insurance coverage; decline in real estate values resulting in impairment of our real estate assets; volatility in the banking industry and credit markets; uncertainties in the capital and securities markets; terrorism or other hostilities involving the United States; building moratorium or “slow-growth” or “no-growth” initiatives that could be implemented in states in which we operate; changes in mortgage and other interest rates; conditions in the capital, credit and financial markets, including mortgage lending standards and the availability of mortgage financing; changes in generally accepted accounting principles or interpretations of those principles; changes in prices of homebuilding materials; competition for home sales from other sellers of new and resale homes; cancellations and our ability to realize our backlog; the occurrence of events such as landslides, soil subsidence and earthquakes that are uninsurable, not

economically insurable or not subject to effective indemnification agreements; changes in governmental laws and regulations; whether we are able to pay off or refinance the outstanding balances of our debt obligations at their maturity; limitations on our ability to utilize our tax attributes; whether an ownership change occurred that could, under certain circumstances, have resulted in the limitation of our ability to offset prior years’ taxable income with net operating losses; the timing of receipt of regulatory approvals and the opening of projects; the availability and cost of land for future development; our ability to integrate successfully the Polygon Northwest operation with our existing operations; and additional factors discussed under the sections captioned “Risk Factors” included in our annual and quarterly reports filed with the Securities and Exchange Commission. The foregoing list is not exhaustive. New risk factors may emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business.

Investor/Media Contacts:

Larry Clark

Financial Profiles, Inc.

(310) 622-8223

WLH@finprofiles.com

WILLIAM LYON HOMES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands except number of shares and per share data)

(unaudited)

	Three Months Ended March 31, 2016			Three Months Ended March 31, 2015
Operating revenue
Home sales	$	261,295		$	189,715
Construction services		3,130			7,453
		264,425			197,168
Operating costs
Cost of sales — homes		(215,171	)		(154,081	)
Construction services		(2,824	)		(6,029	)
Sales and marketing		(14,993	)		(12,224	)
General and administrative		(17,834	)		(13,948	)
Amortization of intangible assets		—			(203	)
Other		(323	)		(536	)
		(251,145	)		(187,021	)
Operating income		13,280			10,147
Equity in income of unconsolidated joint ventures		1,181			248
Other income, net		525			781
Income before provision for income taxes		14,986			11,176
Provision for income taxes		(5,045	)		(3,570	)
Net income		9,941			7,606
Less: Net income attributable to noncontrolling interests		(927	)		(924	)
Net income available to common stockholders	$	9,014		$	6,682
Income per common share:
Basic	$	0.25		$	0.18
Diluted	$	0.24		$	0.18
Weighted average common shares outstanding:
Basic		36,651,846			36,463,995
Diluted		38,303,861			37,633,831

WILLIAM LYON HOMES

CONSOLIDATED BALANCE SHEETS

(in thousands, except number of shares and par value per share)

	March 31,		December 31,
	2016		2015
	(unaudited)
ASSETS
Cash and cash equivalents	$	35,798	$	50,203
Restricted cash		505		504
Receivables		6,124		14,838
Escrow proceeds receivable		3,024		3,041
Real estate inventories		1,753,315		1,675,106
Investment in unconsolidated joint ventures		6,414		5,413
Goodwill		66,902		66,902
Intangibles, net of accumulated amortization of $4,640 as of March 31, 2016 and December 31, 2015		6,700		6,700
Deferred income taxes, net		79,631		79,726
Other assets, net		20,622		21,017
Total assets	$	1,979,035	$	1,923,450
LIABILITIES AND EQUITY
Accounts payable	$	78,854	$	75,881
Accrued expenses		71,576		70,324
Revolving credit facility		49,000		65,000
Construction notes payable		13,201		15,915
Joint venture notes payable		123,616		94,266
Subordinated amortizing note		12,390		14,066
53/4% Senior Notes due April 15, 2019		148,429		148,295
8 1/2% Senior Notes due November 15, 2020		422,887		422,896
7% Senior Notes due August 15, 2022		345,474		345,338
		1,265,427		1,251,981
Commitments and contingencies
Equity:
William Lyon Homes stockholders’ equity
Preferred stock, par value $0.01 per share; 10,000,000 and no shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively		—		—
Common stock, Class A, par value $0.01 per share; 150,000,000 shares authorized; 28,294,219 and 28,363,879 shares issued, 27,856,010 and 27,657,435 outstanding at March 31, 2016 and December 31, 2015, respectively		290		284
Common stock, Class B, par value $0.01 per share; 30,000,000 shares authorized; 3,813,884 shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively		38		38
Additional paid-in capital		414,226		413,810
Retained earnings		226,977		217,963
Total William Lyon Homes stockholders’ equity		641,531		632,095
Noncontrolling interests		72,077		39,374
Total equity		713,608		671,469
Total liabilities and equity	$	1,979,035	$	1,923,450

WILLIAM LYON HOMES

SELECTED FINANCIAL AND OPERATING INFORMATION

(unaudited)

	Three Months Ended March 31,
	2016			2015
	Consolidated Total			Consolidated Total			Percentage% Change
Selected Financial Information (1)
(dollars in thousands)
Homes closed		543			388			40	%
Home sales revenue	$	261,295		$	189,715			38	%
Cost of sales (excluding interest and purchase accounting adjustments)		(196,831	)		(143,047	)		38	%
Adjusted homebuilding gross margin (2)	$	64,464		$	46,668			38	%
Adjusted homebuilding gross margin percentage (2)		24.7	%		24.6	%		0	%
Interest in cost of sales		(11,747	)		(6,701	)		75	%
Purchase accounting adjustments		(6,593	)		(4,333	)		52	%
Gross margin	$	46,124		$	35,634			29	%
Gross margin percentage		17.7	%		18.8	%		(6	%)
Number of homes closed
California		142			135			5	%
Arizona		82			25			228	%
Nevada		62			34			82	%
Colorado		53			41			29	%
Washington		68			76			(11	%)
Oregon		136			77			77	%
Total		543			388			40	%
Average sales price of homes closed
California	$	653,200		$	587,700			11	%
Arizona		256,700			287,400			(11	%)
Nevada		495,800			801,200			(38	%)
Colorado		498,000			443,600			12	%
Washington		483,800			411,600			18	%
Oregon		422,500			343,900			23	%
Total	$	481,200		$	489,000			(2	%)
Number of net new home orders
California		162			184			(12	%)
Arizona		108			44			145	%
Nevada		66			46			43	%
Colorado		78			85			(8	%)
Washington		84			114			(26	%)
Oregon		191			115			66	%
Total		689			588			17	%
Average number of sales locations during period
California		18			17			6	%
Arizona		8			5			60	%
Nevada		12			9			33	%
Colorado		10			13			(23	%)
Washington		6			5			20	%
Oregon		15			5			200	%
Total		69			54			28	%

(1) For the periods presented, the Company is reporting in six segments: California, Arizona, Nevada, Colorado, Washington and Oregon.

(2) Adjusted homebuilding gross margin is a financial measure that is not prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP. It is used by management in evaluating operating performance and in making strategic decisions regarding sales pricing, construction and development pace, product mix and other operating decisions. We believe this information is meaningful as it isolates the impact that interest and purchase accounting adjustments have on homebuilding gross margin and allows investors to make better comparisons with our competitors.

WILLIAM LYON HOMES

SELECTED FINANCIAL AND OPERATING INFORMATION

(unaudited)

	As of March 31,
	2016		2015
	Consolidated Total		Consolidated Total		Percentage% Change
Backlog of homes sold but not closed at end of period
California		214		207		3	%
Arizona		235		66		256	%
Nevada		119		85		40	%
Colorado		103		128		(20	%)
Washington		60		100		(40	%)
Oregon		154		92		67	%
Total		885		678		31	%
Dollar amount of homes sold but not closed at end of period (in thousands)
California	$	166,193	$	124,341		34	%
Arizona		62,169		18,147		243	%
Nevada		86,863		56,715		53	%
Colorado		53,011		57,237		(7	%)
Washington		35,492		44,128		(20	%)
Oregon		67,969		34,500		97	%
Total	$	471,697	$	335,068		41	%
Lots owned and controlled at end of period
Lots owned
California		1,653		2,318		(29	%)
Arizona		5,122		5,396		(5	%)
Nevada		3,319		2,982		11	%
Colorado		745		938		(21	%)
Washington		1,570		1,351		16	%
Oregon		1,142		1,148		(1	%)
Total		13,551		14,133		(4	%)
Lots controlled
California		1,317		1,097		20	%
Arizona		—		—		0	%
Nevada		64		83		(23	%)
Colorado		822		183		349	%
Washington		361		728		(50	%)
Oregon		1,920		1,249		54	%
Total		4,484		3,340		34	%
Total lots owned and controlled
California		2,970		3,415		(13	%)
Arizona		5,122		5,396		(5	%)
Nevada		3,383		3,065		10	%
Colorado		1,567		1,121		40	%
Washington		1,931		2,079		(7	%)
Oregon		3,062		2,397		28	%
Total		18,035		17,473		3	%

WILLIAM LYON HOMES

SUPPLEMENTAL FINANCIAL INFORMATION

(unaudited)

	Three			Three
	Months			Months
	Ended			Ended
	March 31,			March 31,
	2016			2015
Net income attributable to William Lyon Homes	$	9,014		$	6,682
Net cash used in operating activities	$	(59,536	)	$	(61,096	)
Interest incurred	$	20,261		$	18,033
Adjusted EBITDA (1)	$	33,532		$	23,022
Adjusted EBITDA Margin (2)		12.7	%		11.7	%
Ratio of adjusted EBITDA to interest incurred		1.7			1.3

Balance Sheet Data

	March 31,			December 31,
	2016			2015
Cash, cash equivalents and restricted cash	$	36,303		$	50,707
Total William Lyon Homes stockholders’ equity		641,531			632,095
Noncontrolling interest		72,077			39,374
Total debt		1,114,997			1,105,776
Total book capitalization	$	1,828,605		$	1,777,245
Ratio of debt to total book capitalization		61.0	%		62.2	%
Ratio of debt to total book capitalization (net of cash)		60.2	%		61.1	%

(1) Adjusted EBITDA means net income (loss) attributable to William Lyon Homes plus (i) provision for income taxes, (ii) interest expense, (iii) amortization of capitalized interest included in cost of sales, (iv) stock based compensation, (v) depreciation and amortization, (vi) non-cash purchase accounting adjustments, (vii) cash distributions of income from unconsolidated joint ventures, and (viii) equity in income of unconsolidated joint ventures. Other companies may calculate adjusted EBITDA differently. Adjusted EBITDA is not a financial measure prepared in accordance with U.S. GAAP. Adjusted EBITDA is presented herein because management believes the presentation of adjusted EBITDA provides useful information to the Company’s investors regarding the Company’s financial condition and results of operations because adjusted EBITDA is a widely utilized indicator of a company’s operating performance. Adjusted EBITDA should not be considered as an alternative for net income, cash flows from operating activities and other consolidated income or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity. A reconciliation of net income attributable to William Lyon Homes to adjusted EBITDA is provided in the following table:

(2) Calculated as Adjusted EBITDA as a percentage of operating revenue.

WILLIAM LYON HOMES

SUPPLEMENTAL FINANCIAL INFORMATION

(unaudited)

	Three			Three
	Months			Months
	Ended			Ended
	March 31,			March 31,
	2016			2015
Net income attributable to William Lyon Homes	$	9,014		$	6,682
Provision for income taxes		5,045			3,570
Interest expense
Interest incurred		20,261			18,033
Interest capitalized		(20,261	)		(18,033	)
Amortization of capitalized interest included in cost of sales		11,747			6,701
Stock based compensation		1,492			1,351
Depreciation and amortization		498			557
Non-cash purchase accounting adjustments		6,593			4,333
Cash distributions of income from unconsolidated joint ventures		324			76
Equity in income of unconsolidated joint ventures		(1,181	)		(248	)
Adjusted EBITDA	$	33,532		$	23,022

EX-99.2

2016 Q1 Earnings Call May 9, 2016, 10:00 am PT Exhibit 99.2

Forward Looking Statements Certain statements contained in the Company’s press release for the three months ended March 31, 2016 and the accompanying comments during our conference call that are not historical information may constitute “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995, including, but not limited to, forward-looking statements related to: community count growth, market and industry trends, the continued housing market recovery, operating results for the second quarter of 2016 and full year 2016, average sale price of homes to be closed in various periods, SG&A percentage, gross margins, future cash needs and liquidity, leverage ratios and reduction strategies, land acquisition spending and backlog conversion rates. The forward-looking statements involve risks and uncertainties and actual results may differ materially from those projected or implied. The Company makes no commitment, and disclaims any duty, to update or revise any forward-looking statements to reflect future events or changes in these expectations. Further, certain forward-looking statements are based on assumptions of future events which may not prove to be accurate. Factors that may impact such forward-looking statements include, among others: the availability of labor and homebuilding materials and increased construction cycle times; adverse weather conditions, including but not limited to the continued drought in California and the Southwest; our financial leverage and level of indebtedness and any inability to comply with financial and other covenants under our debt instruments; continued volatility and worsening in general economic conditions either internationally, nationally or in regions in which we operate; conditions in our newly entered markets and newly acquired operations; worsening in markets for residential housing; the impact of construction defect, product liability and home warranty claims, including the adequacy of self-insurance accruals, and the applicability and sufficiency of our insurance coverage; decline in real estate values resulting in impairment of our real estate assets; volatility in the banking industry and credit markets; uncertainties in the capital and securities markets; terrorism or other hostilities involving the United States; building moratorium or “slow-growth” or “no-growth” initiatives that could be implemented in states in which we operate; changes in mortgage and other interest rates; conditions in the capital, credit and financial markets, including mortgage lending standards and the availability of mortgage financing; changes in generally accepted accounting principles or interpretations of those principles; changes in prices of homebuilding materials; competition for home sales from other sellers of new and resale homes; cancellations and our ability to realize our backlog; the occurrence of events such as landslides, soil subsidence and earthquakes that are uninsurable, not economically insurable or not subject to effective indemnification agreements; changes in governmental laws and regulations; whether we are able to pay off or refinance the outstanding balances of our debt obligations at their maturity; limitations on our ability to utilize our tax attributes; whether an ownership change occurred that could, under certain circumstances, have resulted in the limitation of our ability to offset prior years’ taxable income with net operating losses; the timing of receipt of regulatory approvals and the opening of projects; the availability and cost of land for future development; our ability to integrate successfully the Polygon Northwest operation with our existing operations; and additional factors discussed under the sections captioned “Risk Factors” included in our annual and quarterly reports filed with the Securities and Exchange Commission. The foregoing list is not exhaustive. New risk factors may emerge from time to time and it is not possible for management to predict all such risk factors or to assess the impact of such risk factors on our business.   A copy of the press release reporting the Company’s financial results for the three months ended March 31, 2016 is available on the Company's website at www.lyonhomes.com.

Management Presenters William H. Lyon Chairman of the Board and Executive Chairman Matthew Zaist President and Chief Executive Officer Colin Severn Senior Vice President and Chief Financial Officer

Year over Year Comparisons % y-o-y change: +117% +49% +10% +17% % y-o-y change: +76% +49% +35% +28% % y-o-y change: +24% 0% (18%) (8%) Net New Orders (Units) Order Value (In Millions) Average Community Count Monthly Order Absorption Rate/Avg. Community % y-o-y change: +92% +50% +12% +25% Order ASP ($ In Thousands) $504 $444 $472 $475 $464 $473 $456 $486 2014 2015 2016

% y-o-y change: +48% +24% +13% +38% Year over Year Comparisons (continued) % y-o-y change: +65% +33% +13% +40% Homes Closed Homebuilding Revenue (In Millions) Bps y-o-y change: (120bps) +10bps +70bps +10bps Bps y-o-y change: (450bps) (160bps) (70bps) (110bps) Adjusted Gross Margin Gross Margin (GAAP) 2014 2015 2016

Backlog Growth – Year over Year Value $335M Homes 678 ASP $494k Q1 2015 Q1 2016 Value $472M Homes 885 ASP $533k Units 31%ASP 8%$ Value 41%

Backlog Conversion Rate Backlog Conversion Rate - Quarterly

Summary of Q1 2016 Results William Lyon Homes’ business has continued to improve across a number of financial and operating metrics Net new home orders are up 17% y-o-y and dollar value of orders up 25% y-o-y. New home deliveries of 543 and Home sales revenue of $261.3 million are up 40% and 38% y-o-y, respectively. Operating income of $13.3 million, up 32%. Net income to common stockholders of $9.0 million, up 35% SG&A margin of 12.5%, reduction of 130 bps. bps Three months ended Twelve months ended 42460 42094 Change 42369 42004 Change Select operating statistics New home orders 689 588 0.17176870748299319 2,575 1,677 0.5354800238521169 Dollar value of orders ($mm) $334.5 $268.2 0.25 New home deliveries 543 388 0.39948453608247425 2,314 1,753 0.32002281802624072 ASP (homes closed, $000s) $481.2 $489 -1.5950920245398795E-2 $466.3 $488.9 -4.622622213131513E-2 Summary financial information ($mm) Home sales revenue $261.3 $189.7 0.37743806009488678 $1,078.9000000000001 $857 0.25892648774795812 Homebuilding gross profit $46.1 $35.6 0.2949438202247191 $199.9 $179.5 0.11364902506963792 Operating income $13.3 $10.1 0.31683168316831695 $81 $75.900000000000006 6.7193675889327981E-2 Net income to common stockholders $9 $6.7 0.35 $57.3 $44.6 0.28475336322869943 Diluted EPS ($) $0.24 $0.18 0.32 $1.48 $1.34 0.10447761194029843 Adjusted EBITDA $33.5 $23 0.45652173913043476 73.8 $158.5 $122.7 0.29176854115729417 Select margins Gross margin 0.17699999999999999 0.188 -,110.1 0.185 0.20899999999999999 -,239.99999999999994 Adjusted gross margin 0.247 0.246 10.000000000000009 0.248 0.252 -40.000000000000036 SG&A margin 0.125 0.13800000000000001 -,130.11 0.112 0.11700000000000001 -50.000000000000043

2016 Sales Volume – Actual vs. Prior Year Total Net Orders by Month (Units) % y-o-y change: +21% +22% +11% +3% 2015 2016 Avg. Sales Locations: 55 72 52 67 54 67 63 68 69 71 71 73 76 75 74 72 Monthly Absorption Rate: 3.0 2.8 3.6 3.4 4.3 3.8 4.5 4.3 4.0 4.0 3.1 3.1 2.4 2.3 2.6 2.1 Consistent Seq. Absorption Imprv.

Strong New Order Growth – Dollars Trailing Twelve Months Dollar value of new home orders of over $1.25 billion on a TTM basis, an increase of 42% over the TTM period in the prior year and up 88% over a two year period. Q1’16 dollar value of new orders was $335 million, up 25% over the prior year. TTM Dollar Value of Orders ($ Millions) TTM Ending: Up 42% Y-o-Y

Strong New Order Growth – Units Trailing Twelve Months New net orders of 2,676 units for TTM Q1 2016. Increase of 43% over prior year and 96% over two year period. TTM Orders (Units) TTM Ending: Up 43% Y-o-Y

Diversified product strategy, allowing us to offer a wide range of product, from entry level to luxury. We have implemented a land acquisition and product positioning strategy to increase our exposure to the entry level buyer segment. Entry level deliveries in Q1 2016 represented 35% of total deliveries as compared to 42% of all sold but not closed homes in backlog. ASP by Buyer Type ($ in ‘000s) Units by Buyer Type High Quality, Diverse Product Offerings Buyer Type - Q1 2016 Homes Closed Price Range - Q1 2016 Home Closings and Backlog Home Closings Backlog ASP: $481K ASP: $533K Buyer Type - Q1 2016 Ending Backlog ASP by Buyer Type ($ in ‘000s) Units by Buyer Type ≤ $300k 21% ≤ $300k 22% > $600k 23% > $600k 28% Entry 1st time move-up 2nd time move-up Luxury Entry 1st time move-up 2nd time move-up Luxury Luxury 1% Luxury 6% $319 $520 $608 $1,370 $353 $458 $675 $1,670 2nd time move-up 23% Entry 35% 1st time move-up 41% 2nd time move-up 19% Entry 42% 1st time move-up 33% $451k - $600k 20% $301k - $450k 36% $451k - $600k 19% $301k - $450k 31%

Continued Growth and Diversification Through Monetization of High Quality Land Positions Total lots owned and controlled vs. years of land supply Q1 2016 deliveries (units) Continued diversification across markets Lots inventory summary as of 3/31/16 We own or control 18,035 lots as of March 31, 2016 in some of the most dynamic and land constrained markets in the Western U.S. Q1 2016 deliveries ($ revenue)

Consistent Growth and Operating Leverage Over the last years, the Company has generated strong annual revenue growth and consistently lower SG&A as a percentage of homebuilding revenue. Q1’16 SG&A represents 12.5% of the quarterly homebuilding revenue, down from 13.8% in Q1’15. TTM Total Revenue ($ Millions) TTM Ending: TTM SG&A as a % of Homebuilding Revenue Note: 2014 SG&A excludes Polygon transaction fees of $5.9 million. SG&A G&A

Key Investment Highlights Strong market share in high quality markets Attractive land portfolio High quality, diverse product offerings Balanced capital structure Expertise in land acquisition, entitlement, and development Disciplined operating strategy Strong customer satisfaction and significant brand loyalty Experienced management team

Appendix

Adjusted EBITDA Three Months Ended March 31, Twelve Months Ended December 31, 2016 2015 2015 2014 Adjusted EBITDA (dollars in thousands) Net income attributable to William Lyon Homes $9,014 $6,682 $57,335.684800000003 $44,625 Provision for income taxes 5,045 3,570 26,806.315200000001 23,797 Interest expense aaInterest incurred 20,261 18,033 76,222 65,559 aaInterest capitalized ,-20,261 ,-18,033 ,-76,222 ,-65,559 Amortization of capitalized interest included in cost of sales 11,747 6,701 38,416 26,510 Stock-based compensation 1,492 1,351 6,570 6,114 Depreciation and amortization 498 557 2,663 6,041 Non-cash purchase accounting adjustments q 6,593 4,333 28,919 9,979 Cash distributions of income from unconsolidated joint ventures 324 76 1,075 353 Equity in income of unconsolidated joint ventures -1,181 -,248 -3,239 -,555 Adjusted EBITDA $33,532 $23,022 $,158,546 $,116,864 Northern California 46 65

Adjusted Homebuilding Gross Margin (1) Cost of sales excluding interest and purchase accounting adjustments