Delaware | 001-09186 | 23-2416878 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||
250 Gibraltar Road, Horsham, PA | 19044 | |||
(Address of Principal Executive Offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
99.1* |
TOLL BROTHERS, INC. | ||||||
Dated: | December 5, 2017 | By: | /s/ Joseph R. Sicree | |||
Joseph R. Sicree Senior Vice President, Chief Accounting Officer |
FOR IMMEDIATE RELEASE | CONTACT: Frederick N. Cooper (215) 938-8312 |
December 5, 2017 | fcooper@tollbrothers.com |
▪ | Net income was $191.9 million, or $1.17 per share diluted, compared to net income of $114.4 million, or $0.67 per share diluted |
▪ | Pre-tax income was $301.7 million, compared to $168.2 million in FY 2016’s fourth quarter, which was negatively impacted by a $121.2 million warranty charge |
▪ | Revenues were $2.03 billion - up 9%; home building deliveries were 2,424 units - also up 9% |
▪ | Net signed contract value was $1.75 billion - up 20%; contract units were 1,979 - up 15% |
▪ | Backlog value at FYE 2017 rose to $5.06 billion - up 27%; units totaled 5,851 - up 25% |
▪ | Gross margin, as a percentage of revenues, was 22.3% |
▪ | Adjusted Gross Margin, which excludes interest and inventory write-downs (“Adjusted Gross Margin”), was 25.3% |
▪ | SG&A, as a percentage of revenues, was 8.3% |
▪ | Income from operations was 14.0% of revenues |
▪ | Other income and Income from unconsolidated entities of $17.3 million declined from $32.7 million |
▪ | Redeemed $287.5 million of 0.5% convertible securities due 2032 in September, eliminating 5.9 million shares from the future diluted share count |
▪ | Redeemed $400 million principal amount of 8.91% senior notes at maturity in October |
▪ | Repurchased approximately 5.2 million shares of its common stock at an average price of $38.48 per share for a total purchase price of approximately $200.2 million |
▪ | FY 2017 net income was $535.5 million, or $3.17 per share diluted, compared to net income of $382.1 million, or $2.18 per share diluted |
▪ | Pre-tax income was $814.3 million, compared to $589.0 million in FY 2016, which was negatively impacted by $125.6 million in warranty charges |
▪ | Revenues were $5.82 billion - up 12%; home building deliveries were 7,151 units - up 17% |
▪ | Net signed contract value was $6.83 billion - up 21%; contract units were 8,175 - up 22% |
▪ | Gross margin, as a percentage of revenues, was 21.5% |
▪ | Adjusted Gross Margin was 24.8% |
▪ | SG&A, as a percentage of revenues, was 10.5% |
▪ | Income from operations was 11.1% of revenues |
▪ | Other income and Income from unconsolidated entities of $169.4 million increased from $99.0 million |
▪ | Return on beginning stockholders’ equity was 12.7% |
▪ | Initiated a quarterly dividend in April |
▪ | Repurchased approximately 7.7 million shares at an average price of $37.81 per share for a total purchase price of approximately $290.9 million |
▪ | Issued $300 million of 4.875% 10-year senior notes in March and an additional $150 million (priced at a yield of 4.4%) in June |
▪ | First quarter deliveries of between 1,300 and 1,500 units with an average price of between $820,000 and $840,000 |
▪ | FY deliveries of between 7,700 and 8,700 units with an average price of between $810,000 and $860,000 |
▪ | FY Adjusted Gross Margin of between 23.75% and 24.25% of revenues; first quarter Adjusted Gross Margin of 23.3% |
▪ | FY SG&A, as a percentage of FY revenues of approximately 10.0%; first quarter SG&A, as a percentage of first quarter revenues, of approximately 13.3% |
▪ | FY Other income and Income from unconsolidated entities of between $130 million and $170 million, with approximately $40 million in the first quarter |
▪ | Absent any tax reform, FY tax rate of approximately 37.0%; first quarter tax rate of approximately 33.5% |
▪ | FY 2017’s fourth-quarter net income was $191.9 million, or $1.17 per share diluted, compared to FY 2016’s fourth-quarter net income of $114.4 million, or $0.67 per share diluted. |
▪ | FY 2017’s fourth-quarter pre-tax income was $301.7 million, compared to FY 2016’s fourth-quarter pre-tax income of $168.2 million. FY 2017’s fourth-quarter results included pre-tax inventory impairments totaling $3.5 million. FY 2016’s fourth-quarter results included pre-tax inventory impairments of $2.5 million and a $121.2 million charge for estimated warranty costs related to claims from older stucco homes and other water intrusion claims. |
▪ | FY 2017’s net income was $535.5 million, or $3.17 per share diluted, compared to FY 2016’s net income of $382.1 million, or $2.18 per share diluted. |
▪ | FY 2017’s pre-tax income was $814.3 million, compared to FY 2016’s pre-tax income of $589.0 million. FY 2017’s results included pre-tax inventory impairments totaling $14.8 million. FY 2016’s pre-tax income included pre-tax inventory impairments totaling $13.8 million and $125.6 million in charges for estimated warranty costs related to claims from older stucco homes and other water intrusion claims. |
▪ | FY 2017’s fourth-quarter total revenues of $2.03 billion and 2,424 units rose 9% in both dollars and units, compared to FY 2016’s fourth-quarter total revenues of $1.86 billion and 2,224 units. The average price of homes delivered was $836,600, compared to $834,300 one year ago. |
▪ | FY 2017’s total revenues of $5.82 billion and 7,151 units rose 12% in dollars and 17% in units, compared to FY 2016’s same period totals of $5.17 billion and 6,098 units. |
▪ | The Company’s FY 2017 fourth-quarter net contracts of $1.75 billion and 1,979 units rose by 20% in dollars and 15% in units, compared to FY 2016’s fourth-quarter net contracts of $1.47 billion and 1,728 units. The average price of net signed contracts was $886,800, compared to $847,800 one year ago. |
▪ | On a per-community basis, FY 2017’s fourth-quarter net signed contracts were up 9% to 6.34 units, compared to fourth-quarter totals of 5.82 in FY 2016, 5.21 units in FY 2015, and 5.01 in FY 2014. This was the highest fourth quarter per-community total since FY 2005. |
▪ | The Company’s FY 2017 net contracts of $6.83 billion and 8,175 units increased 21% in dollars and 22% in units, compared to net contracts of $5.65 billion and 6,719 units in FY 2016. |
▪ | FY 2017’s fiscal-year-end backlog of $5.06 billion and 5,851 units increased 27% in dollars and 25% in units, compared to FY 2016’s fiscal-year-end backlog of $3.98 billion and 4,685 units. The average price of homes in backlog was $865,100, compared to $850,400 one year ago. |
▪ | FY 2017’s fourth-quarter gross margin, as a percentage of revenues, was 22.3%, compared to 15.4% in FY 2016’s fourth quarter. FY 2017’s fourth-quarter Adjusted Gross Margin was 25.3%, and FY 2016’s fourth-quarter Adjusted Gross Margin, further adjusted to exclude a warranty charge related to claims from older stucco homes and other water intrusion claims, was 24.9%. Without this further adjustment, FY 2016’s fourth-quarter Adjusted Gross Margin was 18.4%. |
▪ | FY 2017’s gross margin, as a percentage of revenues, was 21.5%, compared to 19.8% in FY 2016. FY 2017’s Adjusted Gross Margin was 24.8%, and FY 2016’s Adjusted Gross Margin, further adjusted to exclude a warranty charge related to claims from older stucco homes and other water intrusion claims, was 25.6%. Without this further adjustment, FY 2016’s Adjusted Gross Margin was 23.2%. |
▪ | Interest included in cost of sales was 2.9% of revenues in FY 2017’s fourth quarter, compared to 2.9% in FY 2016’s fourth quarter. |
▪ | Interest included in cost of sales was 3.0% of revenues in FY 2017, compared to 3.1% in FY 2016. |
▪ | SG&A, as a percentage of revenues, was 8.3% in FY 2017’s fourth quarter, compared to 8.1% in FY 2016’s fourth quarter. |
▪ | SG&A, as a percentage of revenues, was 10.5% in FY 2017, compared to 10.4% in FY 2016. |
▪ | Income from operations of $284.4 million represented 14.0% of revenues in FY 2017’s fourth quarter, compared to $135.4 million and 7.3% of revenues in FY 2016’s fourth quarter. |
▪ | Income from operations of $644.9 million represented 11.1% of revenues in FY 2017, compared to $490.1 million and 9.5% of revenues in FY 2016. |
▪ | Other income and Income from unconsolidated entities in FY 2017’s fourth quarter totaled $17.3 million, compared to $32.7 million in FY 2016’s same quarter. |
▪ | Other income and Income from unconsolidated entities in FY 2017 totaled $169.4 million, compared to $99.0 million in FY 2016. |
▪ | FY 2017’s fourth-quarter cancellation rate (current-quarter cancellations divided by current-quarter signed contracts) was 7.9%, compared to 4.9% in FY 2016’s fourth quarter. As a percentage of beginning-quarter backlog, FY 2017’s fourth-quarter cancellation rate was 2.7%, compared to 1.7% in FY 2016’s fourth quarter. |
▪ | The Company ended FY 2017 with $712.8 million of cash and marketable securities, compared to $946.2 million at 2017’s third-quarter end and $633.7 million at FYE 2016. At FYE 2017, the Company also had $1.15 billion available under its $1.295 billion 20-bank credit facility, which matures in May 2021. |
▪ | During the fourth quarter of FY 2017, the Company repurchased approximately 5.2 million shares of its common stock at an average price of $38.48 per share for a total purchase price of approximately $200.2 million. In FY 2017, the Company repurchased approximately 7.7 million shares at an average price of $37.81 per share for a total purchase price of approximately $290.9 million. |
▪ | The Company issued $300 million of 4.875% 10-year senior notes in March and an additional $150 million (priced at a yield of 4.4%) in June. |
▪ | The Company redeemed $287.5 million of 0.5% convertible securities due 2032 in September, eliminating 5.9 million shares from future diluted share count. |
▪ | The Company redeemed $400 million principal amount of 8.91% senior notes at maturity in October. |
▪ | On October 27, 2017, the Company paid its quarterly dividend of $0.08 per share to shareholders of record on the close of business on October 13, 2017. |
▪ | The Company’s Stockholders’ Equity at FYE 2017 was $4.53 billion, compared to $4.24 billion at FYE 2016. |
▪ | The Company ended FY 2017 with a debt-to-capital ratio of 41.5%, compared to 45.8% at FY 2017’s third-quarter end and 47.2% at FYE 2016. The Company ended FY 2017’s fourth quarter with a net debt-to-capital ratio(1) of 34.5%, compared to 38.4% at FY 2017’s third-quarter end, and 40.9% at FYE 2016. |
▪ | The Company ended FY 2017 with approximately 48,300 lots owned and optioned, compared to 47,800 one quarter earlier, and 48,800 one year earlier. At FYE 2017, approximately 31,300 of these lots were owned, of which approximately 17,200 lots, including those in backlog, were substantially improved. |
▪ | In the fourth quarter of FY 2017, the Company spent approximately $192.3 million on land to purchase 986 lots. |
▪ | In FY 2017, the Company spent approximately $664.3 million on land to purchase 5,663 lots, including its first quarter acquisition of Coleman Homes in Boise, Idaho. |
▪ | The Company ended FY 2017 with 305 selling communities, compared to 312 at FY 2017’s third-quarter end and 310 at FYE 2016. |
▪ | The Company expects FY 2018 first-quarter deliveries of between 1,300 and 1,500 units with an average price of between $820,000 and $840,000, and full FY 2018 deliveries of between 7,700 and 8,700 units with an average price of between $810,000 and $860,000. |
▪ | The Company expects its full FY 2018 Adjusted Gross Margin to be between 23.75% and 24.75% of revenues. FY 2018 first quarter Adjusted Gross Margin is projected to be approximately 23.3%. |
▪ | SG&A, as a percentage of full FY 2018 revenues, is projected to be approximately 10.0%. FY 2018 first quarter SG&A, as a percentage of first quarter revenues, is projected to be approximately 13.3%. |
▪ | The Company’s full FY 2018 Other income and Income from unconsolidated entities is expected to be between $130 million and $170 million with approximately $40 million occurring in the first quarter. |
▪ | The Company expects its FY 2018 tax rate to be approximately 37.0%, and its FY 2018’s first quarter tax rate to be approximately 33.5%, absent any tax reform. |
(1) | See “Reconciliation of Non-GAAP Measures” below for more information on the calculation of the Company’s net debt-to-capital ratio. |
October 31, 2017 | October 31, 2016 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 712,829 | $ | 633,715 | |||
Restricted cash and investments | 2,482 | 31,291 | |||||
Inventory | 7,281,453 | 7,353,967 | |||||
Property, construction and office equipment, net | 189,547 | 169,576 | |||||
Receivables, prepaid expenses and other assets | 542,217 | 582,758 | |||||
Mortgage loans held for sale | 132,922 | 248,601 | |||||
Customer deposits held in escrow | 102,017 | 53,057 | |||||
Investments in unconsolidated entities | 481,758 | 496,411 | |||||
Deferred tax assets, net of valuation allowances | 167,413 | ||||||
$ | 9,445,225 | $ | 9,736,789 | ||||
LIABILITIES AND EQUITY | |||||||
Liabilities: | |||||||
Loans payable | $ | 637,416 | $ | 871,079 | |||
Senior notes | 2,462,463 | 2,694,372 | |||||
Mortgage company loan facility | 120,145 | 210,000 | |||||
Customer deposits | 396,026 | 309,099 | |||||
Accounts payable | 275,223 | 281,955 | |||||
Accrued expenses | 959,353 | 1,072,300 | |||||
Income taxes payable | 57,509 | 62,782 | |||||
Total liabilities | 4,908,135 | 5,501,587 | |||||
Equity: | |||||||
Stockholders’ Equity | |||||||
Common stock | 1,779 | 1,779 | |||||
Additional paid-in capital | 720,115 | 728,464 | |||||
Retained earnings | 4,474,064 | 3,977,297 | |||||
Treasury stock, at cost | (662,854 | ) | (474,912 | ) | |||
Accumulated other comprehensive loss | (1,910 | ) | (3,336 | ) | |||
Total stockholders' equity | 4,531,194 | 4,229,292 | |||||
Noncontrolling interest | 5,896 | 5,910 | |||||
Total equity | 4,537,090 | 4,235,202 | |||||
$ | 9,445,225 | $ | 9,736,789 |
Twelve Months Ended October 31, | Three Months Ended October 31, | ||||||||||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||||||||||
$ | % | $ | % | $ | % | $ | % | ||||||||||||||||
Revenues | $ | 5,815,058 | $ | 5,169,508 | $ | 2,027,907 | $ | 1,855,451 | |||||||||||||||
Cost of revenues | 4,562,303 | 78.5 | % | 4,144,065 | 80.2 | % | 1,575,832 | 77.7 | % | 1,569,767 | 84.6 | % | |||||||||||
Gross margin | 1,252,755 | 21.5 | % | 1,025,443 | 19.8 | % | 452,075 | 22.3 | % | 285,684 | 15.4 | % | |||||||||||
Selling, general and administrative expenses | 607,819 | 10.5 | % | 535,382 | 10.4 | % | 167,636 | 8.3 | % | 150,262 | 8.1 | % | |||||||||||
Income from operations | 644,936 | 11.1 | % | 490,061 | 9.5 | % | 284,439 | 14.0 | % | 135,422 | 7.3 | % | |||||||||||
Other: | |||||||||||||||||||||||
Income from unconsolidated entities | 116,066 | 40,748 | 3,792 | 17,994 | |||||||||||||||||||
Other income - net | 53,309 | 58,218 | 13,516 | 14,744 | |||||||||||||||||||
Income before income taxes | 814,311 | 589,027 | 301,747 | 168,160 | |||||||||||||||||||
Income tax provision | 278,816 | 206,932 | 109,869 | 53,782 | |||||||||||||||||||
Net income | $ | 535,495 | $ | 382,095 | $ | 191,878 | $ | 114,378 | |||||||||||||||
Per share: | |||||||||||||||||||||||
Basic earnings | $ | 3.30 | $ | 2.27 | $ | 1.20 | $ | 0.70 | |||||||||||||||
Diluted earnings | $ | 3.17 | $ | 2.18 | $ | 1.17 | $ | 0.67 | |||||||||||||||
Cash dividend declared | $ | 0.24 | $ | 0.08 | |||||||||||||||||||
Weighted-average number of shares: | |||||||||||||||||||||||
Basic | 162,222 | 168,261 | 159,332 | 163,970 | |||||||||||||||||||
Diluted | 169,487 | 175,973 | 164,565 | 171,683 | |||||||||||||||||||
Effective tax rate | 34.2% | 35.1% | 36.4% | 32.0% |
Twelve Months Ended October 31, | Three Months Ended October 31, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||||
Impairment charges recognized: | |||||||||||||||
Cost of sales - land owned/controlled for future communities | $ | 4,999 | $ | 5,442 | $ | 1,980 | $ | 2,039 | |||||||
Cost of sales - operating communities | 9,795 | 8,365 | 1,500 | 415 | |||||||||||
$ | 14,794 | $ | 13,807 | $ | 3,480 | $ | 2,454 | ||||||||
Depreciation and amortization | $ | 25,361 | $ | 23,121 | $ | 6,924 | $ | 6,283 | |||||||
Interest incurred | $ | 175,944 | $ | 164,001 | $ | 45,057 | $ | 41,922 | |||||||
Interest expense: | |||||||||||||||
Charged to cost of sales | $ | 172,832 | $ | 160,337 | $ | 58,467 | $ | 53,161 | |||||||
Charged to other income - net | 4,823 | 1,143 | 2,726 | 537 | |||||||||||
$ | 177,655 | $ | 161,480 | $ | 61,193 | $ | 53,698 | ||||||||
Home sites controlled: | |||||||||||||||
Owned | 31,341 | 34,137 | |||||||||||||
Optioned | 16,970 | 14,700 | |||||||||||||
48,311 | 48,837 |
October 31, 2017 | October 31, 2016 | ||||||
Land and land development costs | $ | 1,861,820 | $ | 2,497,603 | |||
Construction in progress | 4,720,926 | 4,225,456 | |||||
Sample homes | 506,557 | 460,948 | |||||
Land deposits and costs of future development | 167,445 | 144,417 | |||||
Other | 24,705 | 25,543 | |||||
$ | 7,281,453 | $ | 7,353,967 |
North: | Connecticut, Illinois, Massachusetts, Michigan, Minnesota, New Jersey and New York |
Mid-Atlantic: | Delaware, Maryland, Pennsylvania and Virginia |
South: | Florida, North Carolina and Texas |
West: | Arizona, Colorado, Idaho, Nevada, and Washington |
California: | California |
Three Months Ended October 31, | |||||||||||||||||||||
Units | $ (Millions) | Average Price Per Unit $ | |||||||||||||||||||
2017 | 2016 | 2017 | 2016 | 2017 | 2016 | ||||||||||||||||
HOME BUILDING REVENUES | |||||||||||||||||||||
North | 327 | 444 | $ | 214.7 | $ | 322.8 | $ | 656,700 | $ | 727,100 | |||||||||||
Mid-Atlantic | 548 | 503 | 337.8 | 318.8 | 616,400 | 633,700 | |||||||||||||||
South | 439 | 362 | 332.7 | 278.2 | 758,000 | 768,500 | |||||||||||||||
West | 543 | 505 | 330.5 | 355.0 | 608,600 | 703,000 | |||||||||||||||
California | 420 | 404 | 622.2 | 566.8 | 1,481,400 | 1,402,900 | |||||||||||||||
Traditional Home Building | 2,277 | 2,218 | 1,837.9 | 1,841.6 | 807,200 | 830,300 | |||||||||||||||
City Living | 147 | 6 | 190.0 | 13.9 | 1,292,400 | 2,322,900 | |||||||||||||||
Total consolidated | 2,424 | 2,224 | $ | 2,027.9 | $ | 1,855.5 | $ | 836,600 | $ | 834,300 | |||||||||||
CONTRACTS | |||||||||||||||||||||
North | 327 | 346 | $ | 223.1 | $ | 242.5 | $ | 682,300 | $ | 700,800 | |||||||||||
Mid-Atlantic | 422 | 409 | 277.6 | 248.6 | 657,700 | 607,900 | |||||||||||||||
South | 340 | 317 | 253.5 | 238.4 | 745,500 | 752,000 | |||||||||||||||
West | 440 | 374 | 298.6 | 279.1 | 678,700 | 746,400 | |||||||||||||||
California | 373 | 242 | 605.9 | 389.3 | 1,624,400 | 1,608,700 | |||||||||||||||
Traditional Home Building | 1,902 | 1,688 | 1,658.7 | 1,397.9 | 872,000 | 828,200 | |||||||||||||||
City Living | 77 | 40 | 96.3 | 67.1 | 1,251,100 | 1,676,600 | |||||||||||||||
Total consolidated | 1,979 | 1,728 | $ | 1,755.0 | $ | 1,465.0 | $ | 886,800 | $ | 847,800 | |||||||||||
BACKLOG | |||||||||||||||||||||
North | 1,217 | 977 | $ | 816.1 | $ | 692.8 | $ | 670,600 | $ | 709,100 | |||||||||||
Mid-Atlantic | 1,143 | 986 | 741.6 | 610.0 | 648,800 | 618,700 | |||||||||||||||
South | 1,055 | 960 | 815.9 | 736.4 | 773,400 | 767,100 | |||||||||||||||
West | 1,397 | 1,020 | 972.0 | 766.5 | 695,700 | 751,500 | |||||||||||||||
California | 887 | 533 | 1,495.1 | 867.7 | 1,685,600 | 1,627,900 | |||||||||||||||
Traditional Home Building | 5,699 | 4,476 | 4,840.7 | 3,673.4 | 849,400 | 820,700 | |||||||||||||||
City Living | 152 | 209 | 220.8 | 310.7 | 1,452,700 | 1,486,500 | |||||||||||||||
Total consolidated | 5,851 | 4,685 | $ | 5,061.5 | $ | 3,984.1 | $ | 865,100 | $ | 850,400 |
Twelve Months Ended October 31, | |||||||||||||||||||||
Units | $ (Millions) | Average Price Per Unit $ | |||||||||||||||||||
2017 | 2016 | 2017 | 2016 | 2017 | 2016 | ||||||||||||||||
HOME BUILDING REVENUES | |||||||||||||||||||||
North | 1,139 | 1,172 | $ | 775.5 | $ | 814.5 | $ | 680,900 | $ | 695,000 | |||||||||||
Mid-Atlantic | 1,681 | 1,432 | 1,030.3 | 895.7 | 612,900 | 625,500 | |||||||||||||||
South | 1,247 | 1,093 | 924.0 | 849.6 | 741,000 | 777,300 | |||||||||||||||
West | 1,783 | 1,304 | 1,151.7 | 903.7 | 645,900 | 693,000 | |||||||||||||||
California | 1,041 | 1,006 | 1,550.5 | 1,448.5 | 1,489,400 | 1,439,900 | |||||||||||||||
Traditional Home Building | 6,891 | 6,007 | 5,432.0 | 4,912.0 | 788,300 | 817,700 | |||||||||||||||
City Living | 260 | 91 | 383.1 | 257.5 | 1,473,500 | 2,829,700 | |||||||||||||||
Total consolidated | 7,151 | 6,098 | $ | 5,815.1 | $ | 5,169.5 | $ | 813,200 | $ | 847,700 | |||||||||||
CONTRACTS | |||||||||||||||||||||
North | 1,379 | 1,259 | $ | 898.9 | $ | 888.0 | $ | 651,800 | $ | 705,300 | |||||||||||
Mid-Atlantic | 1,838 | 1,607 | 1,161.9 | 986.8 | 632,200 | 614,100 | |||||||||||||||
South | 1,342 | 1,229 | 1,003.5 | 916.8 | 747,800 | 746,000 | |||||||||||||||
West | 2,032 | 1,508 | 1,318.3 | 1,096.7 | 648,800 | 727,300 | |||||||||||||||
California | 1,395 | 930 | 2,177.9 | 1,418.5 | 1,561,200 | 1,525,300 | |||||||||||||||
Traditional Home Building | 7,986 | 6,533 | 6,560.5 | 5,306.8 | 821,500 | 812,300 | |||||||||||||||
City Living | 189 | 186 | 267.8 | 342.8 | 1,416,900 | 1,843,000 | |||||||||||||||
Total consolidated | 8,175 | 6,719 | $ | 6,828.3 | $ | 5,649.6 | $ | 835,300 | $ | 840,800 |
Units | $ (Millions) | Average Price Per Unit $ | |||||||||||||||||||
2017 | 2016 | 2017 | 2016 | 2017 | 2016 | ||||||||||||||||
Three months ended October 31, | |||||||||||||||||||||
Revenues | 21 | 54 | $ | 23.6 | $ | 109.5 | $ | 1,125,000 | $ | 2,028,300 | |||||||||||
Contracts | 36 | 18 | $ | 58.6 | $ | 28.0 | $ | 1,629,100 | $ | 1,553,100 | |||||||||||
Twelve months ended October 31, | |||||||||||||||||||||
Revenues | 197 | 115 | $ | 475.3 | $ | 164.9 | $ | 2,412,500 | $ | 1,434,000 | |||||||||||
Contracts | 143 | 113 | $ | 196.7 | $ | 169.8 | $ | 1,375,400 | $ | 1,502,900 | |||||||||||
Backlog at October 31, | 116 | 184 | $ | 167.4 | $ | 471.5 | $ | 1,443,500 | $ | 2,562,400 |
• | the Company’s Adjusted Gross Margin (a non-GAAP financial measure), which is calculated as (i) gross margin plus interest recognized in cost of sales plus inventory write-downs divided by (ii) revenues; and |
• | for FY 2016 periods, the Company’s Adjusted Gross Margin, further adjusted for warranty charges related to claims from older stucco homes and other water intrusion claims (a non-GAAP financial measure), which is calculated as (i) gross margin plus interest recognized in cost of sales plus inventory write-downs plus warranty charges related to claims from older stucco homes and other water intrusion claims divided by (ii) revenues. |
Three Months Ended October 31, | Twelve Months Ended October 31, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Revenues | $ | 2,027,907 | $ | 1,855,451 | $ | 5,815,058 | $ | 5,169,508 | ||||||||
Cost of revenues | 1,575,832 | 1,569,767 | 4,562,303 | 4,144,065 | ||||||||||||
Gross margin | 452,075 | 285,684 | 1,252,755 | 1,025,443 | ||||||||||||
Add: | Interest recognized in cost of sales | 58,467 | 53,161 | 172,832 | 160,337 | |||||||||||
Inventory write-downs | 3,480 | 2,454 | 14,794 | 13,807 | ||||||||||||
Adjusted gross margin | $ | 514,022 | $ | 341,299 | $ | 1,440,381 | $ | 1,199,587 | ||||||||
Add: | Warranty charges related to older stucco homes and other water intrusion claims | 121,231 | 125,576 | |||||||||||||
Adjusted gross margin, further adjusted for warranty charges related to older stucco homes and other water intrusion claims | N/A | $ | 462,530 | N/A | $ | 1,325,163 | ||||||||||
Gross margin as a percentage of revenues | 22.3 | % | 15.4 | % | 21.5 | % | 19.8 | % | ||||||||
Adjusted Gross Margin | 25.3 | % | 18.4 | % | 24.8 | % | 23.2 | % | ||||||||
Adjusted gross margin, further adjusted for warranty charges related to older stucco homes and other water intrusion claims | N/A | 24.9 | % | N/A | 25.6 | % |
October 31, 2017 | July 31, 2017 | October 31, 2016 | ||||||||||
Loans payable | $ | 637,416 | $ | 619,574 | $ | 871,079 | ||||||
Senior notes | 2,462,463 | 3,148,905 | 2,694,372 | |||||||||
Mortgage company loan facility | 120,145 | 57,921 | 210,000 | |||||||||
Total debt | 3,220,024 | 3,826,400 | 3,775,451 | |||||||||
Total stockholders' equity | 4,531,194 | 4,532,714 | 4,229,292 | |||||||||
Total capital | $ | 7,751,218 | $ | 8,359,114 | $ | 8,004,743 | ||||||
Ratio of debt-to-capital | 41.5 | % | 45.8 | % | 47.2 | % | ||||||
Total debt | $ | 3,220,024 | $ | 3,826,400 | $ | 3,775,451 | ||||||
Less: | Mortgage company loan facility | (120,145 | ) | (57,921 | ) | (210,000 | ) | |||||
Cash and cash equivalents | (712,829 | ) | (946,195 | ) | (633,715 | ) | ||||||
Total net debt | 2,387,050 | 2,822,284 | 2,931,736 | |||||||||
Total stockholders' equity | 4,531,194 | 4,532,714 | 4,229,292 | |||||||||
Total net capital | $ | 6,918,244 | $ | 7,354,998 | $ | 7,161,028 | ||||||
Net debt-to-capital ratio | 34.5 | % | 38.4 | % | 40.9 | % |