Segment Reporting

3 Months Ended

Mar. 31, 2013

Segment Reporting [Abstract]

Segment Reporting

3. Segment Reporting

Our operating segments are defined as a component of an enterprise for which discrete financial information is available and is reviewed regularly by the chief operating decision-maker, or decision-making group, to evaluate performance and make operating decisions. We have identified our chief operating decision-makers (“CODMs”) as two key executives—the Chief Executive Officer and the Chief Operating Officer.

We have identified each homebuilding division as an operating segment. Our 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 are as follows:

(1) West (Arizona, California, Nevada and Washington)

(2) Mountain (Colorado and Utah)

(3) East (Virginia, Florida, Illinois and Maryland, which includes Pennsylvania, Delaware and New Jersey)

Our Financial Services business consists of the operations 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 HomeAmerican’s 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 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 and treasury, information technology, insurance and 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 segment.

The following table summarizes home and land sale revenues for our homebuilding operations and revenues for our financial services operations.

	Three Months Ended March 31,
	2013		2012
Homebuilding	(Dollars in thousands)
West	$	134,979	$	69,542
Mountain		133,377		60,591
East		63,392		56,135
Total home and land sale revenues	$	331,748	$	186,268
Financial Services
Mortgage operations	$	9,044	$	5,456
Other		3,462		2,264
Total financial services revenues	$	12,506	$	7,720

The following table summarizes pretax income for our homebuilding and financial services operations.

	Three Months Ended March 31,
	2013			2012
Homebuilding	(Dollars in thousands)
West	$	10,611		$	166
Mountain		12,996			2,159
East		1,528			2,100
Corporate		(10,288	)		(7,162	)
Total homebuilding pretax income	$	14,847		$	(2,737	)
Financial Services
Mortgage operations	$	5,999		$	3,339
Other		1,740			1,523
Total financial services pretax income	$	7,739		$	4,862

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 cash and cash equivalents and marketable securities.

	March 31,		December 31,
	2013		2012
Homebuilding assets	(Dollars in thousands)
West	$	518,143	$	459,807
Mountain		328,712		332,939
East		280,659		274,199
Corporate		858,269		692,500
Total homebuilding assets	$	1,985,783	$	1,759,445
Financial services assets
Mortgage operations	$	91,565	$	122,941
Other		64,986		63,055
Total financial services assets	$	156,551	$	185,996