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Supplemental Guarantor Information
6 Months Ended
Apr. 30, 2015
Supplemental Guarantor Information [Abstract]  
Supplemental Guarantor Information [Text Block]
Supplemental Guarantor Information
Our 100%-owned subsidiary, Toll Brothers Finance Corp. (the “Subsidiary Issuer”), has issued the following Senior Notes (amounts in thousands):
 
 
Original amount issued and amount outstanding at
 
 
April 30, 2015
5.15% Senior Notes due 2015
 
$
300,000

8.91% Senior Notes due 2017
 
$
400,000

4.0% Senior Notes due 2018
 
$
350,000

6.75% Senior Notes due 2019
 
$
250,000

5.875% Senior Notes due 2022
 
$
419,876

4.375% Senior Notes due 2023
 
$
400,000

5.625% Senior Notes due 2024
 
$
250,000

0.50% Exchangeable Senior Notes due 2032
 
$
287,500


The obligations of the Subsidiary Issuer to pay principal, premiums, if any, and interest are guaranteed jointly and severally on a senior basis by us and substantially all of our 100%-owned home building subsidiaries (the “Guarantor Subsidiaries”). The guarantees are full and unconditional. Our non-home building subsidiaries and several of our home building subsidiaries (together, the “Non-Guarantor Subsidiaries”) do not guarantee the debt. The Subsidiary Issuer generates no operating revenues and does not have any independent operations other than the financing of our other subsidiaries by lending the proceeds from the above-described debt issuances. The indentures under which the Senior Notes were issued provide that any of our subsidiaries that provide a guarantee of the Credit Facility will guarantee the Senior Notes. The indentures further provide that any Guarantor Subsidiary may be released from its guarantee so long as (i) no default or event of default exists or would result from release of such guarantee; (ii) the Guarantor Subsidiary being released has consolidated net worth of less than 5% of the Company’s consolidated net worth as of the end of our most recent fiscal quarter; (iii) the Guarantor Subsidiaries released from their guarantees in any fiscal year comprise in the aggregate less than 10% (or 15% if and to the extent necessary to permit the cure of a default) of our consolidated net worth as of the end of our most recent fiscal quarter; (iv) such release would not have a material adverse effect on our and our subsidiaries’ home building business; and (v) the Guarantor Subsidiary is released from its guaranty under the Credit Facility. If there are no guarantors under the Credit Facility, all Guarantor Subsidiaries under the indentures will be released from their guarantees.
Separate financial statements and other disclosures concerning the Guarantor Subsidiaries are not presented because management has determined that such disclosures would not be material to investors.
Supplemental consolidating financial information of Toll Brothers, Inc., the Subsidiary Issuer, the Guarantor Subsidiaries, the Nonguarantor Subsidiaries and the eliminations to arrive at Toll Brothers, Inc. on a consolidated basis is presented below ($ amounts in thousands).
Condensed Consolidating Balance Sheet at April 30, 2015:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents

 

 
389,236

 
142,921

 

 
532,157

Marketable securities

 

 


 
10,015

 

 
10,015

Restricted cash
15,206

 

 
1,297

 
1,459

 

 
17,962

Inventory

 

 
6,417,066

 
307,277

 

 
6,724,343

Property, construction and office equipment, net

 

 
123,887

 
17,256

 

 
141,143

Receivables, prepaid expenses and other assets
56

 
15,029

 
156,260

 
118,588

 
(30,975
)
 
258,958

Mortgage loans held for sale

 

 

 
80,864

 

 
80,864

Customer deposits held in escrow

 

 
42,241

 
2,158

 

 
44,399

Investments in and advances to unconsolidated entities

 

 
125,691

 
341,568

 

 
467,259

Investments in distressed loans and foreclosed real estate

 

 


 
65,938

 

 
65,938

Investments in and advances to consolidated entities
3,824,138

 
2,681,738

 
4,740

 


 
(6,510,616
)
 

Deferred tax assets, net of valuation allowances
244,643

 


 


 


 


 
244,643

 
4,084,043

 
2,696,767

 
7,260,418

 
1,088,044

 
(6,541,591
)
 
8,587,681

LIABILITIES AND EQUITY
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Loans payable

 

 
674,817

 


 

 
674,817

Senior notes

 
2,631,124

 

 

 
24,674

 
2,655,798

Mortgage company loan facility

 

 

 
70,052

 

 
70,052

Customer deposits

 

 
266,530

 
8,817

 

 
275,347

Accounts payable

 

 
233,509

 
166

 

 
233,675

Accrued expenses

 
31,906

 
377,933

 
209,217

 
(32,645
)
 
586,411

Advances from consolidated entities

 


 
1,946,002

 
751,619

 
(2,697,621
)
 

Income taxes payable
37,641

 

 

 


 

 
37,641

Total liabilities
37,641

 
2,663,030

 
3,498,791

 
1,039,871

 
(2,705,592
)
 
4,533,741

Equity
 
 
 
 
 
 
 
 
 
 
 
Stockholders’ equity
 
 
 
 
 
 
 
 
 
 
 
Common stock
1,779

 

 
48

 
3,006

 
(3,054
)
 
1,779

Additional paid-in capital
722,303

 
49,400

 


 
1,734

 
(51,134
)
 
722,303

Retained earnings (deficits)
3,381,290

 
(15,663
)
 
3,761,640

 
35,834

 
(3,781,811
)
 
3,381,290

Treasury stock, at cost
(55,980
)
 

 

 

 

 
(55,980
)
Accumulated other comprehensive loss
(2,990
)
 

 
(61
)
 

 


 
(3,051
)
Total stockholders’ equity
4,046,402

 
33,737

 
3,761,627

 
40,574

 
(3,835,999
)
 
4,046,341

Noncontrolling interest

 

 

 
7,599

 

 
7,599

Total equity
4,046,402

 
33,737

 
3,761,627

 
48,173

 
(3,835,999
)
 
4,053,940

 
4,084,043

 
2,696,767

 
7,260,418

 
1,088,044

 
(6,541,591
)
 
8,587,681

Condensed Consolidating Balance Sheet at October 31, 2014:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents

 

 
455,714

 
130,601

 

 
586,315

Marketable securities

 

 
1,997

 
10,029

 

 
12,026

Restricted cash
15,211

 

 
2,070

 
1,061

 

 
18,342

Inventory

 

 
6,260,303

 
230,018

 

 
6,490,321

Property, construction and office equipment, net

 

 
126,586

 
16,424

 

 
143,010

Receivables, prepaid expenses and other assets


 
16,802

 
114,863

 
137,496

 
(17,589
)
 
251,572

Mortgage loans held for sale

 

 

 
101,944

 

 
101,944

Customer deposits held in escrow

 

 
39,912

 
2,161

 

 
42,073

Investments in and advances to unconsolidated entities

 

 
132,096

 
314,982

 

 
447,078

Investments in distressed loans and foreclosed real estate


 


 


 
73,800

 


 
73,800

Investments in and advances to consolidated entities
3,714,788

 
2,677,448

 
4,740

 


 
(6,396,976
)
 

Deferred tax assets, net of valuation allowances
250,421

 


 


 


 


 
250,421

 
3,980,420

 
2,694,250

 
7,138,281

 
1,018,516

 
(6,414,565
)
 
8,416,902

LIABILITIES AND EQUITY
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Loans payable

 

 
653,269

 
992

 

 
654,261

Senior notes

 
2,625,712

 

 

 
29,332

 
2,655,044

Mortgage company loan facility

 

 

 
90,281

 

 
90,281

Customer deposits

 

 
221,084

 
2,715

 

 
223,799

Accounts payable

 

 
225,106

 
241

 

 
225,347

Accrued expenses

 
31,906

 
386,223

 
181,649

 
(18,301
)
 
581,477

Advances from consolidated entities

 


 
2,018,981

 
708,167

 
(2,727,148
)
 

Income taxes payable
125,996

 

 

 


 

 
125,996

Total liabilities
125,996

 
2,657,618

 
3,504,663

 
984,045

 
(2,716,117
)
 
4,556,205

Equity
 
 
 
 
 
 
 
 
 
 
 
Stockholders’ equity
 
 
 
 
 
 
 
 
 
 
 
Common stock
1,779

 

 
48

 
3,006

 
(3,054
)
 
1,779

Additional paid-in capital
712,162

 
49,400

 


 
1,734

 
(51,134
)
 
712,162

Retained earnings (deficits)
3,232,035

 
(12,768
)
 
3,633,618

 
23,410

 
(3,644,260
)
 
3,232,035

Treasury stock, at cost
(88,762
)
 

 

 

 

 
(88,762
)
Accumulated other comprehensive loss
(2,790
)
 

 
(48
)
 

 


 
(2,838
)
Total stockholders’ equity
3,854,424

 
36,632

 
3,633,618

 
28,150

 
(3,698,448
)
 
3,854,376

Noncontrolling interest

 

 

 
6,321

 

 
6,321

Total equity
3,854,424

 
36,632

 
3,633,618

 
34,471

 
(3,698,448
)
 
3,860,697

 
3,980,420

 
2,694,250

 
7,138,281

 
1,018,516

 
(6,414,565
)
 
8,416,902





Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the six months ended April 30, 2015:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Revenues

 

 
1,724,050

 
33,152

 
(51,167
)
 
1,706,035

Cost of revenues

 

 
1,332,727

 
3,095

 
(7,278
)
 
1,328,544

Selling, general and administrative
37

 
1,822

 
226,194

 
27,090

 
(41,144
)
 
213,999

 
37

 
1,822

 
1,558,921

 
30,185

 
(48,422
)
 
1,542,543

Income (loss) from operations
(37
)
 
(1,822
)
 
165,129

 
2,967

 
(2,745
)
 
163,492

Other:
 
 
 
 
 
 
 
 
 
 
 
Income from unconsolidated entities

 

 
7,434

 
3,694

 

 
11,128

Other income - net
4,670

 


 
18,033

 
13,588

 
(356
)
 
35,935

Intercompany interest income

 
72,393

 


 


 
(72,393
)
 

Interest expense

 
(75,228
)
 


 
(266
)
 
75,494

 

Income from subsidiaries
205,922

 

 
15,326

 

 
(221,248
)
 

Income (loss) before income taxes
210,555

 
(4,657
)
 
205,922

 
19,983

 
(221,248
)
 
210,555

Income tax provision (benefit)
61,300

 
(1,762
)
 
77,900

 
7,559

 
(83,697
)
 
61,300

Net income (loss)
149,255

 
(2,895
)
 
128,022

 
12,424

 
(137,551
)
 
149,255

Other comprehensive loss
(201
)
 


 
(12
)
 


 


 
(213
)
Total comprehensive income (loss)
149,054

 
(2,895
)
 
128,010

 
12,424

 
(137,551
)
 
149,042


Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the six months ended April 30, 2014:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Revenues

 

 
1,520,077

 
33,267

 
(49,289
)
 
1,504,055

Cost of revenues

 

 
1,206,293

 
4,059

 
(8,322
)
 
1,202,030

Selling, general and administrative
69

 
1,865

 
213,647

 
26,436

 
(39,827
)
 
202,190

 
69

 
1,865

 
1,419,940

 
30,495

 
(48,149
)
 
1,404,220

Income (loss) from operations
(69
)
 
(1,865
)
 
100,137

 
2,772

 
(1,140
)
 
99,835

Other:
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from unconsolidated entities

 

 
37,578

 
(336
)
 

 
37,242

Other income - net
4,660

 


 
17,815

 
7,208

 
(2,041
)
 
27,642

Intercompany interest income

 
76,107

 


 


 
(76,107
)
 

Interest expense

 
(78,899
)
 


 
(389
)
 
79,288

 

Income from subsidiaries
160,128

 

 
4,598

 

 
(164,726
)
 

Income (loss) before income taxes
164,719

 
(4,657
)
 
160,128

 
9,255

 
(164,726
)
 
164,719

Income tax provision (benefit)
53,917

 
(1,751
)
 
60,224

 
3,481

 
(61,954
)
 
53,917

Net income (loss)
110,802

 
(2,906
)
 
99,904

 
5,774

 
(102,772
)
 
110,802

Other comprehensive income
156

 


 
189

 
12

 


 
357

Total comprehensive income (loss)
110,958

 
(2,906
)
 
100,093

 
5,786

 
(102,772
)
 
111,159


Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended April 30, 2015:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Revenues

 

 
861,896

 
17,550

 
(26,863
)
 
852,583

Cost of revenues

 

 
680,515

 
1,429

 
(3,432
)
 
678,512

Selling, general and administrative
23

 
914

 
114,151

 
13,701

 
(21,104
)
 
107,685

 
23

 
914

 
794,666

 
15,130

 
(24,536
)
 
786,197

Income (loss) from operations
(23
)
 
(914
)
 
67,230

 
2,420

 
(2,327
)
 
66,386

Other:
 
 
 
 
 
 
 
 
 
 
 
Income from unconsolidated entities

 

 
2,712

 
3,515

 

 
6,227

Other income - net
2,300

 


 
7,800

 
3,003

 
816

 
13,919

Intercompany interest income

 
36,200

 


 


 
(36,200
)
 

Interest expense

 
(37,576
)
 


 
(135
)
 
37,711

 

Income from subsidiaries
84,255

 

 
6,513

 

 
(90,768
)
 

Income (loss) before income taxes
86,532

 
(2,290
)

84,255

 
8,803

 
(90,768
)
 
86,532

Income tax provision (benefit)
18,602

 
(871
)
 
32,093

 
3,349

 
(34,571
)
 
18,602

Net income (loss)
67,930

 
(1,419
)

52,162


5,454


(56,197
)

67,930

Other comprehensive loss
(23
)
 


 
(7
)
 


 


 
(30
)
Total comprehensive income (loss)
67,907

 
(1,419
)

52,155


5,454


(56,197
)

67,900


Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended April 30, 2014:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Non-
Guarantor
Subsidiaries
 
Eliminations
 
Consolidated
Revenues

 

 
869,305

 
17,665

 
(26,596
)
 
860,374

Cost of revenues

 

 
690,656

 
1,457

 
(4,115
)
 
687,998

Selling, general and administrative
14

 
928

 
110,947

 
12,799

 
(20,368
)
 
104,320

 
14

 
928


801,603


14,256


(24,483
)
 
792,318

Income (loss) from operations
(14
)
 
(928
)

67,702


3,409


(2,113
)
 
68,056

Other:
 
 
 
 
 
 
 
 
 
 
 
Income from unconsolidated entities

 

 
13,371

 
956

 

 
14,327

Other income - net
2,295

 


 
7,243

 
1,008

 
555

 
11,101

Intercompany interest income

 
37,963

 


 


 
(37,963
)
 

Interest expense

 
(39,325
)
 


 
(196
)
 
39,521

 

Income from subsidiaries
91,203

 

 
2,887

 

 
(94,090
)
 

Income (loss) before income taxes
93,484

 
(2,290
)

91,203


5,177


(94,090
)
 
93,484

Income tax provision (benefit)
28,262

 
(823
)
 
33,212

 
1,883

 
(34,272
)
 
28,262

Net income (loss)
65,222

 
(1,467
)

57,991


3,294


(59,818
)
 
65,222

Other comprehensive income (loss)
103

 


 
(11
)
 
2

 


 
94

Total comprehensive income (loss)
65,325

 
(1,467
)

57,980


3,296


(59,818
)
 
65,316


Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2015:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net cash (used in) provided by operating activities
(48,714
)
 
4,290

 
15,173

 
(2,631
)
 
(6,060
)
 
(37,942
)
Cash flow (used in) provided by investing activities:
 
 
 
 
 
 
 
 
 
 
 
Purchase of property and equipment - net

 

 
(5,037
)
 
(847
)
 

 
(5,884
)
Sale and redemption of marketable securities

 

 
2,000

 

 

 
2,000

Investment in and advances to unconsolidated entities

 

 
(2,253
)
 
(25,452
)
 

 
(27,705
)
Return of investments in unconsolidated entities

 

 
5,797

 
4,840

 

 
10,637

Investment in distressed loans and foreclosed real estate

 

 


 
(1,697
)
 

 
(1,697
)
Return of investments in distressed loans and foreclosed real estate

 

 

 
14,592

 

 
14,592

Net increase in cash from purchase of joint venture interest

 

 
3,848

 


 

 
3,848

Intercompany advances
18,228

 
(4,290
)
 

 


 
(13,938
)
 

Net cash (used in) provided by investing activities
18,228

 
(4,290
)
 
4,355

 
(8,564
)
 
(13,938
)
 
(4,209
)
Cash flow (used in) provided by financing activities:
 
 
 
 
 
 
 
 
 
 
 
Proceeds from loans payable

 

 

 
529,053

 

 
529,053

Principal payments of loans payable

 

 
(22,556
)
 
(550,282
)
 

 
(572,838
)
Proceeds from stock-based benefit plans
34,057

 

 

 

 

 
34,057

Excess tax benefits from stock-based compensation
3,045

 

 

 

 

 
3,045

Purchase of treasury stock
(6,616
)
 

 

 

 

 
(6,616
)
Receipts related to noncontrolling interest


 

 

 
1,292

 

 
1,292

Intercompany advances


 

 
(63,450
)
 
43,452

 
19,998

 

Net cash (used in) provided by financing activities
30,486

 

 
(86,006
)
 
23,515

 
19,998

 
(12,007
)
Net (decrease) increase in cash and cash equivalents

 

 
(66,478
)
 
12,320

 

 
(54,158
)
Cash and cash equivalents, beginning of period

 

 
455,714

 
130,601

 

 
586,315

Cash and cash equivalents, end of period

 

 
389,236

 
142,921

 

 
532,157

Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2014:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net cash (used in) provided by operating activities
44,258

 
15,152

 
(87,965
)
 
(27,401
)
 
(10,229
)
 
(66,185
)
Cash flow (used in) provided by investing activities:
 
 
 
 
 
 
 
 
 
 
 
Purchase of property and equipment — net

 

 
(5,718
)
 
(49
)
 

 
(5,767
)
Sale and redemption of marketable securities

 

 
39,243

 


 

 
39,243

Investment in and advances to unconsolidated entities

 

 
(13,602
)
 
(67,052
)
 

 
(80,654
)
Return of investments in unconsolidated entities

 

 
35,714

 
3,300

 

 
39,014

Investment in distressed loans and foreclosed real estate

 

 


 
(757
)
 

 
(757
)
Return of investments in distressed loans and foreclosed real estate

 

 


 
22,424

 

 
22,424

Acquisition of a business, net of cash acquired

 

 
(1,489,116
)
 

 

 
(1,489,116
)
Dividend received - intercompany

 

 
15,000

 

 
(15,000
)
 

Intercompany advances
(289,604
)
 
(342,492
)
 

 

 
632,096

 

Net cash used in investing activities
(289,604
)
 
(342,492
)
 
(1,418,479
)
 
(42,134
)
 
617,096

 
(1,475,613
)
Cash flow provided by (used in) financing activities:
 
 
 
 
 
 
 
 
 
 
 
Proceeds from issuance of senior notes

 
600,000

 

 


 

 
600,000

Debt issuance costs for senior notes

 
(4,700
)
 

 


 

 
(4,700
)
Proceeds from loans payable

 

 
1,141,300

 
456,262

 

 
1,597,562

Debt issuance costs for loans payable

 

 
(3,005
)
 


 

 
(3,005
)
Principal payments of loans payable

 

 
(572,257
)
 
(474,420
)
 

 
(1,046,677
)
Redemption of senior notes


 
(267,960
)
 

 

 

 
(267,960
)
Net proceeds from issuance of common stock
220,357

 

 

 

 

 
220,357

Proceeds from stock-based benefit plans
23,333

 

 

 

 

 
23,333

Excess tax benefits from stock-based compensation
1,841

 

 

 

 

 
1,841

Purchase of treasury stock
(185
)
 

 

 

 

 
(185
)
Receipts related to noncontrolling interest


 

 

 
81

 

 
81

Dividend paid - intercompany

 

 

 
(15,000
)
 
15,000

 

Intercompany advances


 

 
505,993

 
115,874

 
(621,867
)
 

Net cash provided by financing activities
245,346

 
327,340

 
1,072,031

 
82,797

 
(606,867
)
 
1,120,647

Net (decrease) increase in cash and cash equivalents

 

 
(434,413
)
 
13,262

 

 
(421,151
)
Cash and cash equivalents, beginning of period

 

 
670,102

 
102,870

 

 
772,972

Cash and cash equivalents, end of period

 

 
235,689

 
116,132

 

 
351,821