XML 36 R21.htm IDEA: XBRL DOCUMENT v3.8.0.1
Supplemental Guarantor Information
6 Months Ended
Apr. 30, 2018
Supplemental Guarantor Information [Abstract]  
Supplemental Guarantor Information [Text Block]
Supplemental Guarantor Information
At April 30, 2018, our 100%-owned subsidiary, Toll Brothers Finance Corp. (the “Subsidiary Issuer”), has issued the following outstanding Senior Notes (amounts in thousands):
 
 
Original amount issued and amount outstanding
4.0% Senior Notes due December 31, 2018
 
$
350,000

6.75% Senior Notes due November 1, 2019
 
$
250,000

5.875% Senior Notes due February 15, 2022
 
$
419,876

4.375% Senior Notes due April 15, 2023
 
$
400,000

5.625% Senior Notes due January 15, 2024
 
$
250,000

4.875% Senior Notes due November 15, 2025
 
$
350,000

4.875% Senior Notes due March 15, 2027
 
$
450,000

4.350% Senior Notes due February 15, 2028
 
$
400,000


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 “Nonguarantor Subsidiaries”) do not guarantee these Senior Notes. 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 our obligations under 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.
As of October 31, 2017, one of our 100%-owned subsidiaries was released from its guarantee obligation on these Senior Notes. The Condensed Consolidating Statements of Operations and Comprehensive Income (Loss) and of Cash Flows for the six months and three months ended April 30, 2017 presented below has been retroactively restated to reflect this subsidiary as a Nonguarantor Subsidiary.
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, 2018:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents

 

 
284,320

 
190,793

 

 
475,113

Restricted cash and investments

 

 
281

 
880

 

 
1,161

Inventory

 

 
7,694,392

 
177,177

 

 
7,871,569

Property, construction and office equipment, net

 

 
161,885

 
23,791

 

 
185,676

Receivables, prepaid expenses and other assets

 


 
321,212

 
390,340

 
(111,797
)
 
599,755

Mortgage loans held for sale

 

 

 
111,811

 

 
111,811

Customer deposits held in escrow

 

 
127,822

 
7,250

 

 
135,072

Investments in unconsolidated entities

 

 
47,223

 
409,539

 

 
456,762

Investments in and advances to consolidated entities
4,487,504

 
2,916,816

 
155,315

 
127,177

 
(7,686,812
)
 

Deferred tax assets, net of valuation allowances
6,807

 


 


 


 


 
6,807

 
4,494,311

 
2,916,816

 
8,792,450

 
1,438,758

 
(7,798,609
)
 
9,843,726

LIABILITIES AND EQUITY
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Loans payable

 

 
649,299

 


 

 
649,299

Senior notes

 
2,860,290

 

 

 

 
2,860,290

Mortgage company loan facility

 

 

 
103,550

 

 
103,550

Customer deposits

 

 
455,002

 
14,584

 

 
469,586

Accounts payable

 

 
322,704

 
1,901

 

 
324,605

Accrued expenses
222

 
38,685

 
558,264

 
457,801

 
(118,558
)
 
936,414

Advances from consolidated entities

 


 
1,705,147

 
602,297

 
(2,307,444
)
 

Income taxes payable
13,386

 

 

 


 

 
13,386

Total liabilities
13,608

 
2,898,975

 
3,690,416

 
1,180,133

 
(2,426,002
)
 
5,357,130

Equity
 
 
 
 
 
 
 
 
 
 
 
Stockholders’ equity
 
 
 
 
 
 
 
 
 
 
 
Common stock
1,779

 

 
48

 
3,006

 
(3,054
)
 
1,779

Additional paid-in capital
715,949

 
49,400

 


 
93,734

 
(143,134
)
 
715,949

Retained earnings (deficit)
4,690,272

 
(31,559
)
 
5,101,986

 
155,992

 
(5,226,419
)
 
4,690,272

Treasury stock, at cost
(925,317
)
 

 

 

 

 
(925,317
)
Accumulated other comprehensive loss
(1,980
)
 

 


 

 


 
(1,980
)
Total stockholders’ equity
4,480,703

 
17,841

 
5,102,034

 
252,732

 
(5,372,607
)
 
4,480,703

Noncontrolling interest

 

 

 
5,893

 

 
5,893

Total equity
4,480,703

 
17,841

 
5,102,034

 
258,625

 
(5,372,607
)
 
4,486,596

 
4,494,311

 
2,916,816

 
8,792,450

 
1,438,758

 
(7,798,609
)
 
9,843,726

Condensed Consolidating Balance Sheet at October 31, 2017:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
ASSETS
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents

 

 
533,204

 
179,625

 

 
712,829

Restricted cash and investments

 

 
1,500

 
982

 

 
2,482

Inventory

 

 
7,017,331

 
264,122

 

 
7,281,453

Property, construction and office equipment, net

 

 
165,464

 
24,083

 

 
189,547

Receivables, prepaid expenses and other assets


 


 
319,592

 
296,699

 
(74,074
)
 
542,217

Mortgage loans held for sale

 

 

 
132,922

 

 
132,922

Customer deposits held in escrow

 

 
96,956

 
5,061

 

 
102,017

Investments in unconsolidated entities

 

 
66,897

 
414,861

 

 
481,758

Investments in and advances to consolidated entities
4,589,228

 
2,514,649

 
91,740

 
126,799

 
(7,322,416
)
 

 
4,589,228

 
2,514,649

 
8,292,684

 
1,445,154

 
(7,396,490
)
 
9,445,225

LIABILITIES AND EQUITY
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Loans payable

 

 
637,416

 


 

 
637,416

Senior notes

 
2,462,463

 

 

 

 
2,462,463

Mortgage company loan facility

 

 

 
120,145

 

 
120,145

Customer deposits

 

 
377,083

 
18,943

 

 
396,026

Accounts payable

 

 
271,617

 
3,606

 

 
275,223

Accrued expenses
141

 
34,345

 
563,577

 
440,631

 
(79,341
)
 
959,353

Advances from consolidated entities

 


 
1,584,957

 
659,904

 
(2,244,861
)
 

Income taxes payable
57,893

 

 

 
(384
)
 

 
57,509

Total liabilities
58,034

 
2,496,808

 
3,434,650

 
1,242,845

 
(2,324,202
)
 
4,908,135

Equity
 
 
 
 
 
 
 
 
 
 
 
Stockholders’ equity
 
 
 
 
 
 
 
 
 
 
 
Common stock
1,779

 

 
48

 
3,006

 
(3,054
)
 
1,779

Additional paid-in capital
720,115

 
49,400

 


 
93,734

 
(143,134
)
 
720,115

Retained earnings (deficit)
4,474,064

 
(31,559
)
 
4,857,986

 
99,673

 
(4,926,100
)
 
4,474,064

Treasury stock, at cost
(662,854
)
 

 

 

 

 
(662,854
)
Accumulated other comprehensive loss
(1,910
)
 

 


 

 


 
(1,910
)
Total stockholders’ equity
4,531,194

 
17,841

 
4,858,034

 
196,413

 
(5,072,288
)
 
4,531,194

Noncontrolling interest

 

 

 
5,896

 

 
5,896

Total equity
4,531,194

 
17,841

 
4,858,034

 
202,309

 
(5,072,288
)
 
4,537,090

 
4,589,228

 
2,514,649

 
8,292,684

 
1,445,154

 
(7,396,490
)
 
9,445,225





Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the six months ended April 30, 2018:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Revenues

 

 
2,627,343

 
237,658

 
(90,334
)
 
2,774,667

Cost of revenues

 

 
2,093,152

 
171,743

 
(32,258
)
 
2,232,637

Selling, general and administrative
32

 
1,627

 
333,128

 
40,334

 
(51,202
)
 
323,919

 
32

 
1,627

 
2,426,280

 
212,077

 
(83,460
)
 
2,556,556

Income (loss) from operations
(32
)
 
(1,627
)
 
201,063

 
25,581

 
(6,874
)
 
218,111

Other:
 
 
 
 
 
 
 
 
 
 
 
Income from unconsolidated entities

 

 
6,733

 
34,711

 

 
41,444

Other income  net

 


 
12,683

 
4,066

 
8,042

 
24,791

Intercompany interest income

 
69,203

 
389

 
2,081

 
(71,673
)
 

Interest expense

 
(67,576
)
 
(2,081
)
 
(786
)
 
70,443

 

Income from subsidiaries
284,378

 

 
65,653

 

 
(350,031
)
 

Income before income taxes
284,346

 

 
284,440

 
65,653

 
(350,093
)
 
284,346

Income tax provision
40,429

 

 
40,442

 
9,335

 
(49,777
)
 
40,429

Net income
243,917

 

 
243,998

 
56,318

 
(300,316
)
 
243,917

Other comprehensive income
341

 


 


 


 


 
341

Total comprehensive income
244,258

 

 
243,998

 
56,318

 
(300,316
)
 
244,258


Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the six months ended April 30, 2017:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Revenues

 

 
2,239,917

 
129,698

 
(85,373
)
 
2,284,242

Cost of revenues

 

 
1,767,348

 
79,634

 
(36,539
)
 
1,810,443

Selling, general and administrative
24

 
1,965

 
297,218

 
35,178

 
(50,538
)
 
283,847

 
24

 
1,965

 
2,064,566

 
114,812

 
(87,077
)
 
2,094,290

Income (loss) from operations
(24
)
 
(1,965
)
 
175,351

 
14,886

 
1,704

 
189,952

Other:
 
 
 
 
 
 
 
 
 
 
 
Income from unconsolidated entities

 

 
8,478

 
83,871

 

 
92,349

Other income  net
4,682

 


 
11,142

 
8,809

 
2,056

 
26,689

Intercompany interest income

 
75,053

 


 
2,146

 
(77,199
)
 

Interest expense

 
(77,745
)
 


 
(954
)
 
78,699

 

Income from subsidiaries
304,332

 

 
104,102

 

 
(408,434
)
 

Income (loss) before income taxes
308,990

 
(4,657
)
 
299,073

 
108,758

 
(403,174
)
 
308,990

Income tax provision (benefit)
113,936

 
(1,717
)
 
110,268

 
40,099

 
(148,650
)
 
113,936

Net income (loss)
195,054

 
(2,940
)
 
188,805

 
68,659

 
(254,524
)
 
195,054

Other comprehensive income
337

 


 


 


 


 
337

Total comprehensive income (loss)
195,391

 
(2,940
)
 
188,805

 
68,659

 
(254,524
)
 
195,391













Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended April 30, 2018:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Revenues

 

 
1,511,989

 
133,544

 
(46,334
)
 
1,599,199

Cost of revenues

 

 
1,218,344

 
94,256

 
(14,443
)
 
1,298,157

Selling, general and administrative
14

 
787

 
171,049

 
20,161

 
(25,359
)
 
166,652

 
14

 
787

 
1,389,393

 
114,417

 
(39,802
)
 
1,464,809

Income (loss) from operations
(14
)
 
(787
)
 
122,596

 
19,127

 
(6,532
)
 
134,390

Other:
 
 
 
 
 
 
 
 
 
 
 
Income from unconsolidated entities

 

 
1,601

 
963

 

 
2,564

Other income  net

 


 
6,798

 
3,022

 
5,974

 
15,794

Intercompany interest income

 
36,508

 
389

 
1,058

 
(37,955
)
 

Interest expense

 
(35,721
)
 
(1,058
)
 
(418
)
 
37,197

 

Income from subsidiaries
152,762

 

 
23,752

 

 
(176,514
)
 

Income before income taxes
152,748

 


154,078

 
23,752

 
(177,830
)
 
152,748

Income tax provision (benefit)
40,938

 

 
52,971

 
(2,527
)
 
(50,444
)
 
40,938

Net income
111,810

 


101,107


26,279


(127,386
)

111,810

Other comprehensive income
170

 


 


 


 


 
170

Total comprehensive income
111,980

 


101,107


26,279


(127,386
)

111,980



Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended April 30, 2017:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Revenues

 

 
1,324,094

 
84,002

 
(44,584
)
 
1,363,512

Cost of revenues

 

 
1,043,091

 
50,163

 
(15,813
)
 
1,077,441

Selling, general and administrative
24

 
997

 
153,337

 
18,230

 
(25,836
)
 
146,752

 
24

 
997


1,196,428


68,393


(41,649
)
 
1,224,193

Income (loss) from operations
(24
)
 
(997
)

127,666


15,609


(2,935
)
 
139,319

Other:
 
 
 
 
 
 
 
 
 
 
 
Income from unconsolidated entities

 

 
3,334

 
42,570

 

 
45,904

Other income  net
2,289

 


 
3,891

 
4,309

 
3,497

 
13,986

Intercompany interest income

 
38,557

 


 
2,146

 
(40,703
)
 

Interest expense

 
(39,850
)
 


 
(291
)
 
40,141

 

Income from subsidiaries
196,944

 

 
62,054

 

 
(258,998
)
 

Income (loss) before income taxes
199,209

 
(2,290
)

196,945


64,343


(258,998
)
 
199,209

Income tax provision (benefit)
74,571

 
(868
)
 
73,647

 
24,173

 
(96,952
)
 
74,571

Net income (loss)
124,638

 
(1,422
)

123,298


40,170


(162,046
)
 
124,638

Other comprehensive income
168

 


 


 


 


 
168

Total comprehensive income (loss)
124,806

 
(1,422
)

123,298


40,170


(162,046
)
 
124,806

 

Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2018:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net cash (used in) provided by operating activities
(34,719
)
 
5,576

 
(355,917
)
 
61,174

 
(1,061
)
 
(324,947
)
Cash flow provided by (used in) investing activities:
 
 
 
 
 
 
 
 
 
 
 
Purchase of property and equipment - net

 

 
(6,660
)
 
159

 

 
(6,501
)
Investments in unconsolidated entities

 

 
(1,393
)
 
(9,407
)
 

 
(10,800
)
Return of investments in unconsolidated entities

 

 
23,421

 
30,894

 

 
54,315

Investment in foreclosed real estate and distressed loans

 

 


 
(195
)
 

 
(195
)
Return of investments in foreclosed real estate and distressed loans

 

 

 
3,122

 

 
3,122

Intercompany advances
346,154

 
(402,166
)
 

 


 
56,012

 

Net cash provided by (used in) investing activities
346,154

 
(402,166
)
 
15,368

 
24,573

 
56,012

 
39,941

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

 
400,000

 

 


 

 
400,000

Debt issuance costs for senior notes

 
(3,410
)
 

 


 

 
(3,410
)
Proceeds from loans payable

 

 
450,000

 
788,283

 

 
1,238,283

Principal payments of loans payable

 

 
(471,270
)
 
(804,878
)
 

 
(1,276,148
)
Proceeds from stock-based benefit plans
9,133

 

 

 

 

 
9,133

Purchase of treasury stock
(291,478
)
 

 

 

 

 
(291,478
)
Dividends paid
(29,090
)
 

 

 

 

 
(29,090
)
Intercompany advances


 

 
112,935

 
(57,984
)
 
(54,951
)
 

Net cash provided by (used in) financing activities
(311,435
)
 
396,590

 
91,665

 
(74,579
)
 
(54,951
)
 
47,290

Net (decrease) increase in cash and cash equivalents

 

 
(248,884
)
 
11,168

 

 
(237,716
)
Cash and cash equivalents, beginning of period

 

 
533,204

 
179,625

 

 
712,829

Cash and cash equivalents, end of period

 

 
284,320

 
190,793

 

 
475,113

Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2017:
 
Toll
Brothers,
Inc.
 
Subsidiary
Issuer
 
Guarantor
Subsidiaries
 
Nonguarantor
Subsidiaries
 
Eliminations
 
Consolidated
Net cash provided by (used in) operating activities
54,209

 
6,729

 
(86,868
)
 
280,465

 
(11,475
)
 
243,060

Cash flow (used in) provided by investing activities:
 
 
 
 
 
 
 
 
 
 
 
Purchase of property and equipment — net

 

 
(12,043
)
 
334

 

 
(11,709
)
Sale and redemption of marketable securities and restricted investments — net
10,631

 

 


 
7,418

 

 
18,049

Investments in unconsolidated entities

 

 
(1,969
)
 
(111,546
)
 

 
(113,515
)
Return of investments in unconsolidated entities

 

 
29,566

 
68,521

 

 
98,087

Investment in foreclosed real estate and distressed loans

 

 


 
(513
)
 

 
(513
)
Return of investments in foreclosed real estate and distressed loans

 

 


 
4,376

 

 
4,376

Acquisition of a business

 

 
(85,183
)
 

 

 
(85,183
)
Investment paid - intercompany

 

 
(45,000
)
 

 
45,000

 

Intercompany advances
(76,995
)
 
(303,899
)
 

 

 
380,894

 

Net cash used in investing activities
(66,364
)
 
(303,899
)
 
(114,629
)
 
(31,410
)
 
425,894

 
(90,408
)
Cash flow (used in) provided by financing activities:
 
 
 
 
 
 
 
 
 
 
 
Proceeds from issuance of senior notes

 
300,000

 

 


 

 
300,000

Debt issuance costs for senior notes

 
(2,830
)
 

 


 

 
(2,830
)
Proceeds from loans payable

 

 
125,000

 
644,454

 

 
769,454

Principal payments of loans payable

 

 
(380,555
)
 
(793,325
)
 

 
(1,173,880
)
Proceeds from stock-based benefit plans
40,628

 

 

 

 

 
40,628

Purchase of treasury stock
(15,422
)
 

 

 

 

 
(15,422
)
Dividends paid
(13,051
)
 

 

 

 

 
(13,051
)
Investment received - intercompany


 

 

 
45,000

 
(45,000
)
 

Intercompany advances


 

 
475,693

 
(106,274
)
 
(369,419
)
 

Net cash (used in) provided by financing activities
12,155

 
297,170

 
220,138

 
(210,145
)
 
(414,419
)
 
(95,101
)
Net increase in cash and cash equivalents

 

 
18,641

 
38,910

 

 
57,551

Cash and cash equivalents, beginning of period

 

 
583,440

 
50,275

 

 
633,715

Cash and cash equivalents, end of period

 

 
602,081

 
89,185

 

 
691,266