Segment Reporting

6 Months Ended

Jun. 30, 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 June 30,				Six Months Ended June 30,
	2013		2012		2013		2012
	(Dollars in thousands)
Homebuilding
West	$	164,514	$	117,424	$	299,493	$	186,965
Mountain		133,768		79,699		267,145		140,290
East		103,852		61,224		167,244		117,360
Total home and land sale revenues	$	402,134	$	258,347	$	733,882	$	444,615
Financial Services
Mortgage operations	$	10,494	$	8,433	$	19,538	$	13,889
Other		3,390		2,154		6,852		4,417
Total financial services revenues	$	13,884	$	10,587	$	26,390	$	18,306

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

	Three Months Ended June 30,						Six Months Ended June 30,
	2013			2012			2013			2012
	(Dollars in thousands)
Homebuilding
West	$	16,779		$	2,678		$	27,390		$	2,844
Mountain		14,142			4,636			27,138			6,795
East		4,523			136			6,051			2,236
Corporate		(5,655	)		(4,473	)		(15,943	)		(11,635	)
Total homebuilding pretax income	$	29,789		$	2,977		$	44,636		$	240
Financial Services
Mortgage operations	$	6,855		$	5,749		$	12,854		$	9,088
Other		1,368			929			3,108			2,452
Total financial services pretax income	$	8,223		$	6,678		$	15,962		$	11,540
Total pretax income	$	38,012		$	9,655		$	60,598		$	11,780

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.

	June 30, 2013		December 31, 2012
	(Dollars in thousands)
Homebuilding assets
West	$	610,824	$	459,807
Mountain		359,538		332,939
East		307,005		274,199
Corporate		1,056,283		692,500
Total homebuilding assets	$	2,333,650	$	1,759,445
Financial services assets
Mortgage operations	$	98,589	$	122,941
Other		64,303		63,055
Total financial services assets	$	162,892	$	185,996
Total assets	$	2,496,542	$	1,945,441