Segment Reporting

3 Months Ended

Mar. 31, 2024

Segment Reporting, Disclosure of Entity's Reportable Segments [Abstract]

Segment Reporting

Segment Reporting

An operating segment is defined as a component of an enterprise for which discrete financial information is available and is reviewed regularly by the Chief Operating Decision Maker (“CODM”), or decision-making group, to evaluate performance and make operating decisions. We have identified our CODM as two key executives—the Executive Chairman and the Chief Executive Officer (“CEO”).

We have identified each homebuilding division as an operating segment. Our homebuilding operating segments have been aggregated into the reportable segments noted below because they are similar in the following regards: (1) economic characteristics; (2) housing products; (3) class of homebuyer; (4) regulatory environments; and (5) methods used to construct and sell homes. Our homebuilding reportable segments conducted ongoing operations in the following states:

•West (Arizona, California, Nevada, New Mexico, Oregon, Texas and Washington)

•Mountain (Colorado, Idaho and Utah)

•East (Alabama, Florida, Maryland, Pennsylvania, Tennessee and Virginia)

Our financial services business consists of the following operating segments: (1) HomeAmerican Mortgage Corporation (“HomeAmerican”); (2) Allegiant Insurance Company, Inc., A Risk Retention Group (“Allegiant”); (3) StarAmerican Insurance Ltd. (“StarAmerican”); (4) American Home Insurance Agency, Inc.; and (5) American Home Title and Escrow Company. Due to its contributions to consolidated pretax income, we consider HomeAmerican to be a reportable segment (“mortgage operations”). The remaining operating segments have been aggregated into one reportable segment (“other”) because they do not individually exceed 10 percent of: (1) consolidated revenue; (2) the greater of (a) the combined reported profit of all operating segments that did not report a loss or (b) the positive value of the combined reported loss of all operating segments that reported losses; or (3) consolidated assets.

Corporate is a non-operating segment that develops and implements strategic initiatives and supports our operating divisions by centralizing key administrative functions such as finance, treasury, information technology, insurance, risk management, litigation and human resources. Corporate also provides the necessary administrative functions to support MDC as a publicly traded company. A portion of the expenses incurred by Corporate are allocated to the homebuilding operating segments based on their respective percentages of assets and, to a lesser degree, a portion of Corporate expenses are allocated to the financial services segments. A majority of Corporate’s personnel and resources are primarily dedicated to activities relating to the homebuilding segments, and, therefore, the balance of any unallocated Corporate expenses is included in the homebuilding operations section of our consolidated statements of operations and comprehensive income.

The following table summarizes revenues for our homebuilding and financial services operations:

	Three Months Ended March 31,
	2024		2023
	(Dollars in thousands)
Homebuilding
West	$	830,086	$	577,933
Mountain	310,179		301,155
East	184,937		140,928
Total homebuilding revenues	$	1,325,202	$	1,020,016
Financial Services
Mortgage operations	$	19,651	$	18,419
Other	11,701		11,067
Total financial services revenues	$	31,352	$	29,486

The following table summarizes pretax income (loss) for our homebuilding and financial services operations:

	Three Months Ended March 31,
	2024		2023
	(Dollars in thousands)
Homebuilding
West	$	82,127	$	43,200
Mountain	25,542		25,036
East	12,674		15,309
Corporate	(11,767)		7,454
Total homebuilding pretax income	$	108,576	$	90,999
Financial Services
Mortgage operations	$	9,201	$	9,726
Other	8,463		8,244
Total financial services pretax income	$	17,664	$	17,970
Total pretax income	$	126,240	$	108,969

The following table summarizes total assets for our homebuilding and financial services operations. The assets in our West, Mountain and East segments consist primarily of inventory while the assets in our Corporate segment primarily include our cash and cash equivalents, marketable securities and deferred tax assets. The assets in our financial services segment consist mostly of cash and cash equivalents, marketable securities and mortgage loans held-for-sale.

	March 31, 2024		December 31, 2023
	(Dollars in thousands)
Homebuilding assets
West	$	2,030,141	$	2,155,357
Mountain	903,407		874,031
East	477,708		459,078
Corporate	1,685,024		1,608,726
Total homebuilding assets	$	5,096,280	$	5,097,192
Financial services assets
Mortgage operations	$	311,704	$	295,092
Other	249,600		238,801
Total financial services assets	$	561,304	$	533,893
Total assets	$	5,657,584	$	5,631,085