Supplemental Consolidated Financial Information |
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 January 31, 2019: | | | | | | | | | | | | | | | | | | | | Toll Brothers, Inc. | | Subsidiary Issuer | | Guarantor Subsidiaries | | Nonguarantor Subsidiaries | | Eliminations | | Consolidated | ASSETS | | | | | | | | | | | | Cash and cash equivalents | — |
| | — |
| | 624,608 |
| | 177,126 |
| | — |
| | 801,734 |
| Inventory |
| |
| | 7,620,115 |
| | 94,528 |
| |
| | 7,714,643 |
| Property, construction and office equipment, net |
| |
| | 278,238 |
| | 16,420 |
| |
| | 294,658 |
| Receivables, prepaid expenses and other assets | 7 |
| |
|
| | 280,959 |
| | 427,713 |
| | (99,015 | ) | | 609,664 |
| Mortgage loans held for sale |
| |
| |
| | 88,840 |
| |
| | 88,840 |
| Customer deposits held in escrow |
| |
| | 98,842 |
| | 1,192 |
| |
| | 100,034 |
| Investments in unconsolidated entities |
| |
| | 46,141 |
| | 363,233 |
| |
| | 409,374 |
| Investments in and advances to consolidated entities | 4,821,141 |
| | 2,570,824 |
| | 111,740 |
| | 147,518 |
| | (7,651,223 | ) | | — |
| Income taxes receivable | 16,907 |
| |
|
| |
|
| |
|
| |
|
| | 16,907 |
| | 4,838,055 |
| | 2,570,824 |
| | 9,060,643 |
| | 1,316,570 |
| | (7,750,238 | ) | | 10,035,854 |
| LIABILITIES AND EQUITY | | | | | | | | | | | | Liabilities | | | | | | | | | | | | Loans payable |
| |
| | 998,682 |
| | 1,785 |
| |
| | 1,000,467 |
| Senior notes |
| | 2,511,932 |
| |
| |
| |
| | 2,511,932 |
| Mortgage company loan facility |
| |
| |
| | 74,135 |
| |
| | 74,135 |
| Customer deposits |
| |
| | 401,283 |
| | 5,072 |
| |
| | 406,355 |
| Accounts payable |
| |
| | 301,450 |
| | 592 |
| |
| | 302,042 |
| Accrued expenses | 507 |
| | 41,051 |
| | 513,617 |
| | 427,268 |
| | (102,709 | ) | | 879,734 |
| Advances from consolidated entities |
| |
|
| | 1,136,528 |
| | 446,420 |
| | (1,582,948 | ) | | — |
| Total liabilities | 507 |
| | 2,552,983 |
| | 3,351,560 |
| | 955,272 |
| | (1,685,657 | ) | | 5,174,665 |
| Equity | | | | | | | | | | | | Stockholders’ equity | | | | | | | | | | | | Common stock | 1,779 |
| |
| | 48 |
| | 3,006 |
| | (3,054 | ) | | 1,779 |
| Additional paid-in capital | 717,405 |
| | 49,400 |
| |
|
| | 113,734 |
| | (163,134 | ) | | 717,405 |
| Retained earnings (deficit) | 5,257,237 |
| | (31,559 | ) | | 5,709,035 |
| | 202,931 |
| | (5,898,393 | ) | | 5,239,251 |
| Treasury stock, at cost | (1,139,623 | ) | |
| |
| |
| |
| | (1,139,623 | ) | Accumulated other comprehensive income | 750 |
| |
| |
|
| |
| |
|
| | 750 |
| Total stockholders’ equity | 4,837,548 |
| | 17,841 |
| | 5,709,083 |
| | 319,671 |
| | (6,064,581 | ) | | 4,819,562 |
| Noncontrolling interest |
| |
| |
| | 41,627 |
| |
| | 41,627 |
| Total equity | 4,837,548 |
| | 17,841 |
| | 5,709,083 |
| | 361,298 |
| | (6,064,581 | ) | | 4,861,189 |
| | 4,838,055 |
| | 2,570,824 |
| | 9,060,643 |
| | 1,316,570 |
| | (7,750,238 | ) | | 10,035,854 |
|
Condensed Consolidating Balance Sheet at October 31, 2018: | | | | | | | | | | | | | | | | | | | | Toll Brothers, Inc. | | Subsidiary Issuer | | Guarantor Subsidiaries | | Nonguarantor Subsidiaries | | Eliminations | | Consolidated | ASSETS | | | | | | | | | | | | Cash and cash equivalents | — |
| | — |
| | 1,011,863 |
| | 170,332 |
| | — |
| | 1,182,195 |
| Inventory |
| |
| | 7,493,205 |
| | 105,014 |
| |
| | 7,598,219 |
| Property, construction and office equipment, net |
| |
| | 169,265 |
| | 24,016 |
| |
| | 193,281 |
| Receivables, prepaid expenses and other assets |
|
| |
|
| | 291,299 |
| | 392,559 |
| | (133,080 | ) | | 550,778 |
| Mortgage loans held for sale |
| |
| |
| | 170,731 |
| |
| | 170,731 |
| Customer deposits held in escrow |
| |
| | 116,332 |
| | 1,241 |
| |
| | 117,573 |
| Investments in unconsolidated entities |
| |
| | 44,329 |
| | 387,484 |
| |
| | 431,813 |
| Investments in and advances to consolidated entities | 4,791,629 |
| | 2,916,557 |
| | 91,740 |
| | 126,872 |
| | (7,926,798 | ) | | — |
| | 4,791,629 |
| | 2,916,557 |
| | 9,218,033 |
| | 1,378,249 |
| | (8,059,878 | ) | | 10,244,590 |
| LIABILITIES AND EQUITY | | | | | | | | | | | | Liabilities | | | | | | | | | | | | Loans payable |
| |
| | 686,801 |
| |
|
| |
| | 686,801 |
| Senior notes |
| | 2,861,375 |
| |
| |
| |
| | 2,861,375 |
| Mortgage company loan facility |
| |
| |
| | 150,000 |
| |
| | 150,000 |
| Customer deposits |
| |
| | 405,318 |
| | 5,546 |
| |
| | 410,864 |
| Accounts payable |
| |
| | 361,655 |
| | 443 |
| |
| | 362,098 |
| Accrued expenses | 471 |
| | 37,341 |
| | 600,907 |
| | 462,128 |
| | (127,266 | ) | | 973,581 |
| Advances from consolidated entities |
| |
|
| | 1,551,196 |
| | 476,040 |
| | (2,027,236 | ) | | — |
| Income taxes payable | 30,959 |
| |
| |
| |
|
| |
| | 30,959 |
| Total liabilities | 31,430 |
| | 2,898,716 |
| | 3,605,877 |
| | 1,094,157 |
| | (2,154,502 | ) | | 5,475,678 |
| Equity | | | | | | | | | | | | Stockholders’ equity | | | | | | | | | | | | Common stock | 1,779 |
| |
| | 48 |
| | 3,006 |
| | (3,054 | ) | | 1,779 |
| Additional paid-in capital | 727,053 |
| | 49,400 |
| |
|
| | 93,734 |
| | (143,134 | ) | | 727,053 |
| Retained earnings (deficit) | 5,161,551 |
| | (31,559 | ) | | 5,612,108 |
| | 178,639 |
| | (5,759,188 | ) | | 5,161,551 |
| Treasury stock, at cost | (1,130,878 | ) | |
| |
| |
| |
| | (1,130,878 | ) | Accumulated other comprehensive income | 694 |
| |
| |
|
| |
| |
|
| | 694 |
| Total stockholders’ equity | 4,760,199 |
| | 17,841 |
| | 5,612,156 |
| | 275,379 |
| | (5,905,376 | ) | | 4,760,199 |
| Noncontrolling interest |
| |
| |
| | 8,713 |
| |
| | 8,713 |
| Total equity | 4,760,199 |
| | 17,841 |
| | 5,612,156 |
| | 284,092 |
| | (5,905,376 | ) | | 4,768,912 |
| | 4,791,629 |
| | 2,916,557 |
| | 9,218,033 |
| | 1,378,249 |
| | (8,059,878 | ) | | 10,244,590 |
|
Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended January 31, 2019: | | | | | | | | | | | | | | | | | | | | Toll Brothers, Inc. | | Subsidiary Issuer | | Guarantor Subsidiaries | | Nonguarantor Subsidiaries | | Eliminations | | Consolidated | Revenues: | | | | | | | | | | | | Home sales |
| |
| | 1,292,196 |
| | 27,112 |
| |
| | 1,319,308 |
| Land sales and other |
| |
| | 15,333 |
| | 73,315 |
| | (44,775 | ) | | 43,873 |
| | — |
| | — |
| | 1,307,529 |
| | 100,427 |
| | (44,775 | ) | | 1,363,181 |
| | | | | | | | | | | | | Cost of revenues: | | | | | | | | | | | | Home sales |
| |
| | 1,020,895 |
| | 21,350 |
| |
|
| | 1,042,245 |
| Land sales and other |
|
| |
|
| | 4,138 |
| | 45,891 |
| | (15,776 | ) | | 34,253 |
| | — |
| | — |
| | 1,025,033 |
| | 67,241 |
| | (15,776 | ) | | 1,076,498 |
| Selling, general and administrative | 390 |
| | 733 |
| | 169,917 |
| | 18,753 |
| | (27,555 | ) | | 162,238 |
| Income (loss) from operations | (390 | ) | | (733 | ) | | 112,579 |
| | 14,433 |
| | (1,444 | ) | | 124,445 |
| Other: | | | | | | | | | | | | Income from unconsolidated entities |
| |
| | 5,387 |
| | 753 |
| |
| | 6,140 |
| Other income – net |
| |
|
| | 5,497 |
| | 13,231 |
| | 2,133 |
| | 20,861 |
| Intercompany interest income |
| | 34,121 |
| | 527 |
| | 1,505 |
| | (36,153 | ) | | — |
| Interest expense |
| | (33,388 | ) | | (1,505 | ) | | (571 | ) | | 35,464 |
| | — |
| Income from subsidiaries | 151,836 |
| |
| | 29,352 |
| |
| | (181,188 | ) | | — |
| Income before income taxes | 151,446 |
| | — |
| | 151,837 |
| | 29,351 |
| | (181,188 | ) | | 151,446 |
| Income tax provision | 39,396 |
| |
| | 39,497 |
| | 7,635 |
| | (47,132 | ) | | 39,396 |
| Net income | 112,050 |
| | — |
| | 112,340 |
| | 21,716 |
| | (134,056 | ) | | 112,050 |
| Other comprehensive income | 56 |
| |
|
| |
|
| |
|
| |
|
| | 56 |
| Total comprehensive income | 112,106 |
| | — |
| | 112,340 |
| | 21,716 |
| | (134,056 | ) | | 112,106 |
|
Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended January 31, 2018: | | | | | | | | | | | | | | | | | | | | Toll Brothers, Inc. | | Subsidiary Issuer | | Guarantor Subsidiaries | | Nonguarantor Subsidiaries | | Eliminations | | Consolidated | Revenues |
| |
| | 1,115,354 |
| | 104,114 |
| | (44,000 | ) | | 1,175,468 |
| Cost of revenues |
| |
| | 874,808 |
| | 77,487 |
| | (17,815 | ) | | 934,480 |
| Selling, general and administrative | 18 |
| | 840 |
| | 162,079 |
| | 20,173 |
| | (25,843 | ) | | 157,267 |
| | 18 |
| | 840 |
| | 1,036,887 |
| | 97,660 |
| | (43,658 | ) | | 1,091,747 |
| Income (loss) from operations | (18 | ) | | (840 | ) | | 78,467 |
| | 6,454 |
| | (342 | ) | | 83,721 |
| Other: | | | | | | | | | | | | Income from unconsolidated entities |
| |
| | 5,132 |
| | 33,748 |
| |
| | 38,880 |
| Other income – net |
| |
|
| | 5,885 |
| | 1,044 |
| | 2,068 |
| | 8,997 |
| Intercompany interest income |
| | 32,695 |
| |
|
| | 1,023 |
| | (33,718 | ) | | — |
| Interest expense |
| | (31,855 | ) | | (1,023 | ) | | (368 | ) | | 33,246 |
| | — |
| Income from subsidiaries | 131,616 |
| |
| | 41,901 |
| |
| | (173,517 | ) | | — |
| Income (loss) before income taxes | 131,598 |
| | — |
| | 130,362 |
| | 41,901 |
| | (172,263 | ) | | 131,598 |
| Income tax provision (benefit) | (509 | ) | |
| | (12,529 | ) | | 11,861 |
| | 668 |
| | (509 | ) | Net income (loss) | 132,107 |
| | — |
| | 142,891 |
| | 30,040 |
| | (172,931 | ) | | 132,107 |
| Other comprehensive income | 171 |
| |
|
| |
|
| |
|
| |
|
| | 171 |
| Total comprehensive income (loss) | 132,278 |
| | — |
| | 142,891 |
| | 30,040 |
| | (172,931 | ) | | 132,278 |
|
Condensed Consolidating Statement of Cash Flows for the three months ended January 31, 2019: | | | | | | | | | | | | | | | | | | | | Toll Brothers, Inc. | | Subsidiary Issuer | | Guarantor Subsidiaries | | Nonguarantor Subsidiaries | | Eliminations | | Consolidated | Net cash (used in) provided by operating activities | (33,260 | ) | | 4,268 |
| | (207,541 | ) | | 60,699 |
| | (9,391 | ) | | (185,225 | ) | Cash flow provided by (used in) investing activities: | | | | | | | | | | | | Purchase of property and equipment - net |
| |
| | (19,707 | ) | | 131 |
| |
| | (19,576 | ) | Investments in unconsolidated entities |
| |
| | (2,235 | ) | | (14,970 | ) | |
| | (17,205 | ) | Return of investments in unconsolidated entities |
| |
| |
|
| | 42,677 |
| |
| | 42,677 |
| Investment in foreclosed real estate and distressed loans |
| |
| |
|
| | (130 | ) | |
| | (130 | ) | Return of investments in foreclosed real estate and distressed loans |
| |
| |
| | 482 |
| |
| | 482 |
| Proceeds from sale of golf club property |
| |
| |
| | 18,220 |
| |
| | 18,220 |
| Investment paid - intercompany |
| |
| | (20,000 | ) | |
| | 20,000 |
| | — |
| Intercompany advances | 76,603 |
| | 345,732 |
| |
| |
|
| | (422,335 | ) | | — |
| Net cash provided by (used in) investing activities | 76,603 |
| | 345,732 |
| | (41,942 | ) | | 46,410 |
| | (402,335 | ) | | 24,468 |
| Cash flow provided by (used in) financing activities: | | | | | | | | | | | | Proceeds from loans payable |
| |
| | 300,000 |
| | 509,506 |
| |
| | 809,506 |
| Debt issuance costs for loans payable |
| |
| | (2,058 | ) | |
|
| |
| | (2,058 | ) | Principal payments of loans payable |
| |
| | (48,222 | ) | | (585,371 | ) | |
| | (633,593 | ) | Redemption of senior notes |
|
| | (350,000 | ) | |
| |
| |
| | (350,000 | ) | Proceeds from stock-based benefit plans, net | (1,831 | ) | |
| |
| |
| |
| | (1,831 | ) | Purchase of treasury stock | (25,143 | ) | |
| |
| |
| |
| | (25,143 | ) | Dividends paid | (16,369 | ) | |
| |
| |
| |
| | (16,369 | ) | Investment received - intercompany |
|
| |
| |
| | 20,000 |
| | (20,000 | ) | | — |
| Intercompany advances |
|
| |
| | (387,492 | ) | | (44,234 | ) | | 431,726 |
| | — |
| Net cash (used in) provided by financing activities | (43,343 | ) | | (350,000 | ) | | (137,772 | ) | | (100,099 | ) | | 411,726 |
| | (219,488 | ) | Net (decrease) increase in cash, cash equivalents, and restricted cash | — |
| | — |
| | (387,255 | ) | | 7,010 |
| | — |
| | (380,245 | ) | Cash, cash equivalents, and restricted cash, beginning of period | — |
| | — |
| | 1,011,867 |
| | 171,072 |
| | — |
| | 1,182,939 |
| Cash and cash equivalents, end of period | — |
| | — |
| | 624,612 |
| | 178,082 |
| | — |
| | 802,694 |
|
Condensed Consolidating Statement of Cash Flows for the three months ended January 31, 2018: | | | | | | | | | | | | | | | | | | | | Toll Brothers, Inc. | | Subsidiary Issuer | | Guarantor Subsidiaries | | Nonguarantor Subsidiaries | | Eliminations | | Consolidated | Net cash (used in) provided by operating activities | (67,018 | ) | | 1,894 |
| | (361,168 | ) | | 99,347 |
| | (2,879 | ) | | (329,824 | ) | Cash flow provided by (used in) investing activities: | | | | | | | | | | | | Purchase of property and equipment — net |
| |
| | (741 | ) | | (953 | ) | |
| | (1,694 | ) | Investments in unconsolidated entities |
| |
| | (1,158 | ) | | (3,264 | ) | |
| | (4,422 | ) | Return of investments in unconsolidated entities |
| |
| | 14,550 |
| | 21,703 |
| |
| | 36,253 |
| Investment in foreclosed real estate and distressed loans |
| |
| |
|
| | (92 | ) | |
| | (92 | ) | Return of investments in foreclosed real estate and distressed loans |
| |
| |
|
| | 1,505 |
| |
| | 1,505 |
| Intercompany advances | 271,988 |
| | (398,484 | ) | |
| |
| | 126,496 |
| | — |
| Net cash provided by (used in) investing activities | 271,988 |
| | (398,484 | ) | | 12,651 |
| | 18,899 |
| | 126,496 |
| | 31,550 |
| 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 |
| |
| | 350,000 |
| | 239,819 |
| |
| | 589,819 |
| Principal payments of loans payable |
| |
| | (366,120 | ) | | (321,620 | ) | |
| | (687,740 | ) | Proceeds from stock-based benefit plans, net | 7,580 |
| |
| |
| |
| |
| | 7,580 |
| Purchase of treasury stock | (200,257 | ) | |
| |
| |
| |
| | (200,257 | ) | Dividends paid | (12,293 | ) | |
| |
| |
| |
| | (12,293 | ) | Intercompany advances |
|
| |
| | 176,261 |
| | (52,644 | ) | | (123,617 | ) | | — |
| Net cash provided by (used in) financing activities | (204,970 | ) | | 396,590 |
| | 160,141 |
| | (134,445 | ) | | (123,617 | ) | | 93,699 |
| Net increase in cash, cash equivalents, and restricted cash | — |
| | — |
| | (188,376 | ) | | (16,199 | ) | | — |
| | (204,575 | ) | Cash, cash equivalents, and restricted cash, beginning of period | — |
| | — |
| | 534,704 |
| | 180,607 |
| | — |
| | 715,311 |
| Cash, cash equivalents, and restricted cash, end of period | — |
| | — |
| | 346,328 |
| | 164,408 |
| | — |
| | 510,736 |
|
|