þ | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
o | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
Delaware (State or other jurisdiction of incorporation or organization) | 23-2416878 (I.R.S. Employer Identification No.) | |
250 Gibraltar Road, Horsham, Pennsylvania (Address of principal executive offices) | 19044 (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common Stock, par value $0.01 per share | TOL | New York Stock Exchange |
Guarantee of Toll Brothers Finance Corp. 5.625% Senior Notes due 2024 | TOL/24 | New York Stock Exchange |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | Emerging growth company o |
Page No. | |
April 30, 2019 | October 31, 2018 | ||||||
(unaudited) | |||||||
ASSETS | |||||||
Cash and cash equivalents | $ | $ | |||||
Inventory | |||||||
Property, construction, and office equipment, net | |||||||
Receivables, prepaid expenses, and other assets (1) | |||||||
Mortgage loans held for sale | |||||||
Customer deposits held in escrow | |||||||
Investments in unconsolidated entities | |||||||
$ | $ | ||||||
LIABILITIES AND EQUITY | |||||||
Liabilities | |||||||
Loans payable | $ | $ | |||||
Senior notes | |||||||
Mortgage company loan facility | |||||||
Customer deposits | |||||||
Accounts payable | |||||||
Accrued expenses | |||||||
Income taxes payable | |||||||
Total liabilities | |||||||
Equity | |||||||
Stockholders’ equity | |||||||
Preferred stock, none issued | |||||||
Common stock, 177,937 shares issued at April 30, 2019 and October 31, 2018 | |||||||
Additional paid-in capital | |||||||
Retained earnings | |||||||
Treasury stock, at cost — 31,907 and 31,774 shares at April 30, 2019 and October 31, 2018, respectively | ( | ) | ( | ) | |||
Accumulated other comprehensive income | |||||||
Total stockholders’ equity | |||||||
Noncontrolling interest | |||||||
Total equity | |||||||
$ | $ |
(1) | As of April 30, 2019 and October 31, 2018, receivables, prepaid expenses, and other assets include $ |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenues: | |||||||||||||||
Home sales | $ | $ | $ | $ | |||||||||||
Land sales | |||||||||||||||
Cost of revenues: | |||||||||||||||
Home sales | |||||||||||||||
Land sales | |||||||||||||||
Selling, general and administrative | |||||||||||||||
Income from operations | |||||||||||||||
Other: | |||||||||||||||
Income from unconsolidated entities | |||||||||||||||
Other income – net | |||||||||||||||
Income before income taxes | |||||||||||||||
Income tax provision | |||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||
Other comprehensive income, net of tax | |||||||||||||||
Total comprehensive income | $ | $ | $ | $ | |||||||||||
Per share: | |||||||||||||||
Basic earnings | $ | $ | $ | $ | |||||||||||
Diluted earnings | $ | $ | $ | $ | |||||||||||
Weighted-average number of shares: | |||||||||||||||
Basic | |||||||||||||||
Diluted |
Common Stock | Addi- tional Paid-in Capital | Retained Earnings | Treasury Stock | Accum- ulated Other Compre- hensive (Loss)/Income | Non-controlling Interest | Total Equity | ||||||||||||||
$ | $ | $ | $ | $ | $ | $ | ||||||||||||||
Balance, October 31, 2018 | ( | ) | ||||||||||||||||||
Cumulative effect adjustment upon adoption of ASC 606, net of tax | ( | ) | ( | ) | ||||||||||||||||
Net income | ||||||||||||||||||||
Purchase of treasury stock | ( | ) | ( | ) | ||||||||||||||||
Exercise of stock options and stock based compensation issuances | ( | ) | ||||||||||||||||||
Employee stock purchase plan issuances | ||||||||||||||||||||
Stock-based compensation | ||||||||||||||||||||
Dividends declared | ( | ) | ( | ) | ||||||||||||||||
Other comprehensive income | ||||||||||||||||||||
Loss attributable to non-controlling interest | ( | ) | ( | ) | ||||||||||||||||
Capital contributions | ||||||||||||||||||||
Balance, April 30, 2019 | ( | ) | ||||||||||||||||||
Balance, October 31, 2017 | ( | ) | ( | ) | ||||||||||||||||
Cumulative effect adjustment upon adoption of ASU 2016-09 and ASU 2018-02, net of tax | ( | ) | ||||||||||||||||||
Net income | ||||||||||||||||||||
Purchase of treasury stock | ( | ) | ( | ) | ||||||||||||||||
Exercise of stock options and stock based compensation issuances | ( | ) | ||||||||||||||||||
Employee stock purchase plan issuances | ||||||||||||||||||||
Stock-based compensation | ||||||||||||||||||||
Dividends declared | ( | ) | ( | ) | ||||||||||||||||
Other comprehensive income | ||||||||||||||||||||
Loss attributable to non-controlling interest | ( | ) | ( | ) | ||||||||||||||||
Balance, April 30, 2018 | ( | ) | ( | ) |
Common Stock | Addi- tional Paid-in Capital | Retained Earnings | Treasury Stock | Accum- ulated Other Compre- hensive (Loss)/Income | Non-controlling Interest | Total Equity | ||||||||||||||
$ | $ | $ | $ | $ | $ | $ | ||||||||||||||
Balance, January 31, 2019 | ( | ) | ||||||||||||||||||
Net income | ||||||||||||||||||||
Purchase of treasury stock | ( | ) | ( | ) | ||||||||||||||||
Exercise of stock options and stock based compensation issuances | ( | ) | ||||||||||||||||||
Employee stock purchase plan issuances | ||||||||||||||||||||
Stock-based compensation | ||||||||||||||||||||
Dividends declared | ( | ) | ( | ) | ||||||||||||||||
Other comprehensive income | ||||||||||||||||||||
Loss attributable to non-controlling interest | ( | ) | ( | ) | ||||||||||||||||
Capital contributions | ||||||||||||||||||||
Balance, April 30, 2019 | ( | ) | ||||||||||||||||||
Balance, January 31, 2018 | ( | ) | ( | ) | ||||||||||||||||
Net income | ||||||||||||||||||||
Purchase of treasury stock | ( | ) | ( | ) | ||||||||||||||||
Exercise of stock options and stock based compensation issuances | ( | ) | ||||||||||||||||||
Employee stock purchase plan issuances | ||||||||||||||||||||
Stock-based compensation | ||||||||||||||||||||
Dividends declared | ( | ) | ( | ) | ||||||||||||||||
Other comprehensive income | ||||||||||||||||||||
Loss attributable to non-controlling interest | ( | ) | ( | ) | ||||||||||||||||
Balance, April 30, 2018 | ( | ) | ( | ) |
Six months ended April 30, | |||||||
2019 | 2018 | ||||||
Cash flow used in operating activities: | |||||||
Net income | $ | $ | |||||
Adjustments to reconcile net income to net cash used in operating activities: | |||||||
Depreciation and amortization | |||||||
Stock-based compensation | |||||||
Income from unconsolidated entities | ( | ) | ( | ) | |||
Distributions of earnings from unconsolidated entities | |||||||
Income from foreclosed real estate and distressed loans | ( | ) | ( | ) | |||
Deferred tax provision (benefit) | ( | ) | |||||
Inventory impairments and write-offs | |||||||
Gain on sales of golf club property and an office building | ( | ) | |||||
Other | |||||||
Changes in operating assets and liabilities | |||||||
Increase in inventory | ( | ) | ( | ) | |||
Origination of mortgage loans | ( | ) | ( | ) | |||
Sale of mortgage loans | |||||||
Increase in receivables, prepaid expenses, and other assets | ( | ) | ( | ) | |||
Increase in customer deposits – net | |||||||
(Decrease) increase in accounts payable and accrued expenses | ( | ) | |||||
Decrease in income taxes payable | ( | ) | ( | ) | |||
Net cash used in operating activities | ( | ) | ( | ) | |||
Cash flow provided by investing activities: | |||||||
Purchase of property, construction, and office equipment – net | ( | ) | ( | ) | |||
Investments in unconsolidated entities | ( | ) | ( | ) | |||
Return of investments in unconsolidated entities | |||||||
Investment in foreclosed real estate and distressed loans | ( | ) | ( | ) | |||
Return of investments in foreclosed real estate and distressed loans | |||||||
Proceeds from sales of golf club property and an office building | |||||||
Net cash provided by investing activities | |||||||
Cash flow (used in) provided by financing activities: | |||||||
Proceeds from issuance of senior notes | |||||||
Debt issuance costs for senior notes | ( | ) | |||||
Proceeds from loans payable | |||||||
Debt issuance costs for loans payable | ( | ) | |||||
Principal payments of loans payable | ( | ) | ( | ) | |||
Redemption of senior notes | ( | ) | |||||
Proceeds from stock-based benefit plans, net | |||||||
Purchase of treasury stock | ( | ) | ( | ) | |||
Dividends paid | ( | ) | ( | ) | |||
Receipts related to noncontrolling interest, net | |||||||
Net cash (used in) provided by financing activities | ( | ) | |||||
Net decrease in cash, cash equivalents, and restricted cash | ( | ) | ( | ) | |||
Cash, cash equivalents, and restricted cash, beginning of period | |||||||
Cash, cash equivalents, and restricted cash, end of period | $ | $ |
• | Prior to adoption of ASC 606, we capitalized certain costs related to our marketing efforts, including sales offices and model home upgrades and furnishings within “Inventory” on our Condensed Consolidated Balance Sheets and amortized such costs through “Selling, general, and administrative” on our Condensed Consolidated Statements of Operations and Comprehensive Income. As of November 1, 2018, we reclassified $ |
• | Prior to adoption of ASC 606, we recorded our land sale revenues, net of their related expenses, within “Other income – net” on our Condensed Consolidated Statements of Operations and Comprehensive Income. As of November 1, 2018, we are presenting this activity in income from operations and breaking out the components of land sales revenues and land sales cost of revenues on our Condensed Consolidated Statements of Operations and Comprehensive Income. In addition, due to the existence of certain repurchase options in existing agreements to sell lots to third party builders in our master planned communities, both for wholly owned projects as well as projects in which we are a joint venture partner, we recorded a net cumulative effect adjustment to retained earnings of approximately $ |
• | Prior to adoption of ASC 606, retained customer deposits were classified in “Other income – net” on our Condensed Consolidated Statements of Operations and Comprehensive Income. As of November 1, 2018, retained customer deposits, which totaled $ |
April 30, 2019 | October 31, 2018 | ||||||
Land controlled for future communities | $ | $ | |||||
Land owned for future communities | |||||||
Operating communities | |||||||
$ | $ |
April 30, 2019 | October 31, 2018 | ||||||
Land owned for future communities: | |||||||
Number of communities | |||||||
Carrying value (in thousands) | $ | $ | |||||
Operating communities: | |||||||
Number of communities | |||||||
Carrying value (in thousands) | $ | $ |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Land controlled for future communities | $ | $ | $ | $ | |||||||||||
Land owned for future communities | |||||||||||||||
Operating communities | |||||||||||||||
$ | $ | $ | $ |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Interest capitalized, beginning of period | $ | $ | $ | $ | |||||||||||
Interest incurred | |||||||||||||||
Interest expensed to home sales cost of revenues | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Interest expensed to land sales cost of revenues | ( | ) | ( | ) | |||||||||||
Interest expensed in other income | ( | ) | ( | ) | |||||||||||
Interest capitalized on investments in unconsolidated entities | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Previously capitalized interest on investments in unconsolidated entities transferred to inventory | |||||||||||||||
Interest capitalized, end of period | $ | $ | $ | $ |
Land Development Joint Ventures | Home Building Joint Ventures | Rental Property Joint Ventures | Gibraltar Joint Ventures | Total | |||||||||||||||
Number of unconsolidated entities | |||||||||||||||||||
Investment in unconsolidated entities | $ | $ | $ | $ | $ | ||||||||||||||
Number of unconsolidated entities with funding commitments by the Company | |||||||||||||||||||
Company’s remaining funding commitment to unconsolidated entities | $ | $ | $ | $ | $ |
Land Development Joint Ventures | Home Building Joint Ventures | Rental Property Joint Ventures | Total | ||||||||||||
Number of joint ventures with debt financing | |||||||||||||||
Aggregate loan commitments | $ | $ | $ | $ | |||||||||||
Amounts borrowed under loan commitments | $ | $ | $ | $ |
April 30, 2019 | October 31, 2018 | ||||||
Cash and cash equivalents | $ | $ | |||||
Inventory | |||||||
Loans receivable, net | |||||||
Rental properties | |||||||
Rental properties under development | |||||||
Real estate owned | |||||||
Other assets | |||||||
Total assets | $ | $ | |||||
Debt, net of deferred financing costs | $ | $ | |||||
Other liabilities | |||||||
Members’ equity | |||||||
Noncontrolling interest | |||||||
Total liabilities and equity | $ | $ | |||||
Company’s net investment in unconsolidated entities (1) | $ | $ |
(1) | Differences between our net investment in unconsolidated entities and our underlying equity in the net assets of the entities are primarily a result of impairments related to our investments in unconsolidated entities; interest capitalized on our investments; the estimated fair value of the guarantees provided to the joint ventures; unrealized gains on our retained joint venture interests; gains recognized from the sale of our ownership interests; and distributions from entities in excess of the carrying amount of our net investment. |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenues | $ | $ | $ | $ | |||||||||||
Cost of revenues | |||||||||||||||
Other expenses | |||||||||||||||
Total expenses | |||||||||||||||
Gain on disposition of loans and real estate owned | |||||||||||||||
Income (loss) from operations | ( | ) | |||||||||||||
Other income | |||||||||||||||
Income (loss) before income taxes | ( | ) | |||||||||||||
Income tax provision (benefit) | ( | ) | |||||||||||||
Net income (loss) including earnings from noncontrolling interests | ( | ) | |||||||||||||
Less: income attributable to noncontrolling interest | ( | ) | ( | ) | ( | ) | |||||||||
Net income (loss) attributable to controlling interest | $ | $ | $ | ( | ) | $ | |||||||||
Company’s equity in earnings of unconsolidated entities (1) | $ | $ | $ | $ |
(1) | Differences between our equity in earnings of unconsolidated entities and the underlying net income of the entities are primarily a result of a basis difference of an acquired joint venture interest; distributions from entities in excess of the carrying amount of our net investment; recoveries of previously incurred charges; unrealized gains on our retained joint venture interests; and our share of the entities’ profits related to home sites purchased by us which reduces our cost basis of the home sites acquired. |
April 30, 2019 | October 31, 2018 | ||||||
Expected recoveries from insurance carriers and others | $ | $ | |||||
Improvement cost receivable | |||||||
Escrow cash held by our captive title company | |||||||
Properties held for rental apartment and commercial development | |||||||
Prepaid expenses | |||||||
Other | |||||||
$ | $ |
April 30, 2019 | October 31, 2018 | ||||||
Senior unsecured term loan | $ | $ | |||||
Loans payable – other | |||||||
Deferred issuance costs | ( | ) | ( | ) | |||
$ | $ |
April 30, 2019 | October 31, 2018 | ||||||
Land, land development, and construction | $ | $ | |||||
Compensation and employee benefits | |||||||
Escrow liability | |||||||
Self-insurance | |||||||
Warranty | |||||||
Deferred income | |||||||
Interest | |||||||
Commitments to unconsolidated entities | |||||||
Other | |||||||
$ | $ |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Balance, beginning of period | $ | $ | $ | $ | |||||||||||
Additions – homes closed during the period | |||||||||||||||
Increase in accruals for homes closed in prior years | |||||||||||||||
Charges incurred | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Balance, end of period | $ | $ | $ | $ |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Total stock-based compensation expense recognized | $ | $ | $ | $ | |||||||||||
Income tax benefit recognized | $ | $ | $ | $ |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Number of shares purchased (in thousands) | |||||||||||||||
Average price per share | $ | $ | $ | $ | |||||||||||
Remaining authorization at April 30 (in thousands) |
Six months ended April 30, | Three months ended April 30, | |||||||||||||||
2019 | 2018 | 2019 | 2018 | |||||||||||||
Numerator: | ||||||||||||||||
Net income as reported | $ | $ | $ | $ | ||||||||||||
Denominator: | ||||||||||||||||
Basic weighted-average shares | ||||||||||||||||
Common stock equivalents (1) | ||||||||||||||||
Diluted weighted-average shares | ||||||||||||||||
Other information: | ||||||||||||||||
Weighted-average number of antidilutive options and restricted stock units (2) | ||||||||||||||||
Shares issued under stock incentive and employee stock purchase plans |
(1) | Common stock equivalents represent the dilutive effect of outstanding in-the-money stock options using the treasury stock method and shares expected to be issued upon the conversion of restricted stock units under our equity award programs. |
(2) |
Fair value | ||||||||||
Financial Instrument | Fair value hierarchy | April 30, 2019 | October 31, 2018 | |||||||
Mortgage Loans Held for Sale | Level 2 | $ | $ | |||||||
Forward Loan Commitments — Mortgage Loans Held for Sale | Level 2 | $ | $ | |||||||
Interest Rate Lock Commitments (“IRLCs”) | Level 2 | $ | $ | ( | ) | |||||
Forward Loan Commitments — IRLCs | Level 2 | $ | ( | ) | $ |
Aggregate unpaid principal balance | Fair value | Excess | |||||||||
At April 30, 2019 | $ | $ | $ | ||||||||
At October 31, 2018 | $ | $ | $ |
Three months ended: | Selling price per unit ($ in thousands) | Sales pace per year (in units) | Discount rate | ||
Fiscal 2019: | |||||
January 31 | 836 - 13,495 | 2 - 12 | 12.5% - 15.8% | ||
April 30 | 372 - 1,915 | 2 - 19 | 12.0% - 26.0% | ||
Fiscal 2018: | |||||
January 31 | 381 - 1,029 | 7 - 10 | 13.8% - 19.0% | ||
April 30 | 485 - 522 | 10 - 16 | 16.9% | ||
July 31 (1) | – | – | – | ||
October 31 | 470 - 1071 | 4 - 23 | 13.5% - 16.3% |
(1) | The impairment charges recognized were related to our decisions to sell lots in a bulk sale in certain communities rather than sell and construct homes as previously intended. The sale price per lot used in the fair value determination for these bulk sales ranged from $ |
Impaired operating communities | |||||||||||
Three months ended: | Number of communities tested | Number of communities | Fair value of communities, net of impairment charges | Impairment charges recognized | |||||||
Fiscal 2019: | |||||||||||
January 31 (1) | $ | $ | |||||||||
April 30 (2) | $ | ||||||||||
$ | |||||||||||
Fiscal 2018: | |||||||||||
January 31 | $ | $ | |||||||||
April 30 (2) | $ | ||||||||||
July 31 (3) | $ | ||||||||||
October 31 | $ | ||||||||||
$ |
(1) | Includes $ |
(2) | Includes $ |
(3) | Includes $ |
April 30, 2019 | October 31, 2018 | ||||||||||||||||
Fair value hierarchy | Book value | Estimated fair value | Book value | Estimated fair value | |||||||||||||
Loans payable (1) | Level 2 | $ | $ | $ | $ | ||||||||||||
Senior notes (2) | Level 1 | ||||||||||||||||
Mortgage company loan facility (3) | Level 2 | ||||||||||||||||
$ | $ | $ | $ |
(1) | The estimated fair value of loans payable was based upon contractual cash flows discounted at interest rates that we believed were available to us for loans with similar terms and remaining maturities as of the applicable valuation date. |
(2) | The estimated fair value of our senior notes is based upon their market prices as of the applicable valuation date. |
(3) | We believe that the carrying value of our mortgage company loan borrowings approximates their fair value. |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Interest income | $ | $ | $ | $ | |||||||||||
Income from ancillary businesses | |||||||||||||||
Management fee income from home building unconsolidated entities, net | |||||||||||||||
Retained customer deposits | |||||||||||||||
Income from land sales | |||||||||||||||
Other | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Total other income – net | $ | $ | $ | $ |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenues | $ | $ | $ | $ | |||||||||||
Expenses | $ | $ | $ | $ | |||||||||||
Other income | $ | $ |
Six months ended April 30, 2018 | Three months ended April 30, 2018 | ||||||
Revenues | $ | $ | |||||
Expenses | ( | ) | ( | ) | |||
Income from land sales | $ | $ |
April 30, 2019 | October 31, 2018 | ||||||
Aggregate purchase commitments: | |||||||
Unrelated parties | $ | $ | |||||
Unconsolidated entities that the Company has investments in | |||||||
Total | $ | $ | |||||
Deposits against aggregate purchase commitments | $ | $ | |||||
Credits to be received from unconsolidated entities | |||||||
Additional cash required to acquire land | |||||||
Total | $ | $ | |||||
Amount of additional cash required to acquire land included in accrued expenses | $ | $ |
April 30, 2019 | October 31, 2018 | ||||||
Aggregate mortgage loan commitments: | |||||||
IRLCs | $ | $ | |||||
Non-IRLCs | |||||||
Total | $ | $ | |||||
Investor commitments to purchase: | |||||||
IRLCs | $ | $ | |||||
Mortgage loans held for sale | |||||||
Total | $ | $ |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Revenues: | |||||||||||||||
Traditional Home Building: | |||||||||||||||
North | $ | $ | $ | $ | |||||||||||
Mid-Atlantic | |||||||||||||||
South | |||||||||||||||
West | |||||||||||||||
California | |||||||||||||||
Traditional Home Building | |||||||||||||||
City Living | |||||||||||||||
Corporate and other | ( | ) | |||||||||||||
Total home sales revenue | |||||||||||||||
Land sales revenue | |||||||||||||||
Total revenue | $ | $ | $ | $ | |||||||||||
Income (loss) before income taxes: | |||||||||||||||
Traditional Home Building: | |||||||||||||||
North | $ | $ | $ | $ | |||||||||||
Mid-Atlantic | |||||||||||||||
South | |||||||||||||||
West | |||||||||||||||
California | |||||||||||||||
Traditional Home Building | |||||||||||||||
City Living | |||||||||||||||
Corporate and other | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Total | $ | $ | $ | $ |
April 30, 2019 | October 31, 2018 | ||||||
Traditional Home Building: | |||||||
North | $ | $ | |||||
Mid-Atlantic | |||||||
South | |||||||
West | |||||||
California | |||||||
Traditional Home Building | |||||||
City Living | |||||||
Corporate and other | |||||||
Total | $ | $ |
Six months ended April 30, | ||||||||
2019 | 2018 | |||||||
Cash flow information: | ||||||||
Interest paid, net of amount capitalized | $ | $ | ||||||
Income tax payments | $ | $ | ||||||
Income tax refunds | $ | $ | ||||||
Noncash activity: | ||||||||
Cost of inventory acquired through seller financing, municipal bonds, or included in accrued expenses, net | $ | $ | ||||||
(Increase) decrease in inventory for capitalized interest, our share of earnings, and allocation of basis difference in land purchased from unconsolidated entities, net | $ | ( | ) | $ | ||||
Reclassification from inventory to property, construction, and office equipment, net due to the adoption of ASC 606 | $ | |||||||
Net decrease in inventory and retained earnings due to the adoption of ASC 606 | $ | |||||||
Net increase in accrued expenses and decrease in retained earnings due to the adoption of ASC 606 | $ | |||||||
Net decrease in investment in unconsolidated entities and retained earnings due to the adoption of ASC 606 | $ | |||||||
Non-controlling interest | $ | |||||||
Transfer of other assets to inventory | $ | $ | ||||||
Transfer of other assets to investment in unconsolidated entities, net | $ | $ | ||||||
Reclassification of deferred income from accrued expenses to investment in unconsolidated entities | $ | |||||||
At April 30, | ||||||||
2019 | 2018 | |||||||
Cash, cash equivalents, and restricted cash | ||||||||
Cash and cash equivalents | $ | $ | ||||||
Restricted cash included in receivables, prepaid expenses, and other assets | ||||||||
Total cash, cash equivalents, and restricted cash shown in the Condensed Consolidated Statements of Cash Flows | $ | $ |
Original amount issued and amount outstanding | ||||
6.75% Senior Notes due November 1, 2019 | $ | |||
5.875% Senior Notes due February 15, 2022 | $ | |||
4.375% Senior Notes due April 15, 2023 | $ | |||
5.625% Senior Notes due January 15, 2024 | $ | |||
4.875% Senior Notes due November 15, 2025 | $ | |||
4.875% Senior Notes due March 15, 2027 | $ | |||
4.350% Senior Notes due February 15, 2028 | $ |
Toll Brothers, Inc. | Subsidiary Issuer | Guarantor Subsidiaries | Nonguarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||
ASSETS | |||||||||||||||||
Cash and cash equivalents | |||||||||||||||||
Inventory | |||||||||||||||||
Property, construction and office equipment, net | |||||||||||||||||
Receivables, prepaid expenses and other assets | ( | ) | |||||||||||||||
Mortgage loans held for sale | |||||||||||||||||
Customer deposits held in escrow | |||||||||||||||||
Investments in unconsolidated entities | |||||||||||||||||
Investments in and advances to consolidated entities | ( | ) | |||||||||||||||
( | ) | ||||||||||||||||
LIABILITIES AND EQUITY | |||||||||||||||||
Liabilities | |||||||||||||||||
Loans payable | |||||||||||||||||
Senior notes | |||||||||||||||||
Mortgage company loan facility | |||||||||||||||||
Customer deposits | |||||||||||||||||
Accounts payable | |||||||||||||||||
Accrued expenses | ( | ) | |||||||||||||||
Advances from consolidated entities | ( | ) | |||||||||||||||
Income taxes payable | |||||||||||||||||
Total liabilities | ( | ) | |||||||||||||||
Equity | |||||||||||||||||
Stockholders’ equity | |||||||||||||||||
Common stock | ( | ) | |||||||||||||||
Additional paid-in capital | ( | ) | |||||||||||||||
Retained earnings (deficit) | ( | ) | ( | ) | |||||||||||||
Treasury stock, at cost | ( | ) | ( | ) | |||||||||||||
Accumulated other comprehensive income | |||||||||||||||||
Total stockholders’ equity | ( | ) | |||||||||||||||
Noncontrolling interest | |||||||||||||||||
Total equity | ( | ) | |||||||||||||||
( | ) |
Toll Brothers, Inc. | Subsidiary Issuer | Guarantor Subsidiaries | Nonguarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||
ASSETS | |||||||||||||||||
Cash and cash equivalents | |||||||||||||||||
Inventory | |||||||||||||||||
Property, construction and office equipment, net | |||||||||||||||||
Receivables, prepaid expenses and other assets | ( | ) | |||||||||||||||
Mortgage loans held for sale | |||||||||||||||||
Customer deposits held in escrow | |||||||||||||||||
Investments in unconsolidated entities | |||||||||||||||||
Investments in and advances to consolidated entities | ( | ) | |||||||||||||||
( | ) | ||||||||||||||||
LIABILITIES AND EQUITY | |||||||||||||||||
Liabilities | |||||||||||||||||
Loans payable | |||||||||||||||||
Senior notes | |||||||||||||||||
Mortgage company loan facility | |||||||||||||||||
Customer deposits | |||||||||||||||||
Accounts payable | |||||||||||||||||
Accrued expenses | ( | ) | |||||||||||||||
Advances from consolidated entities | ( | ) | |||||||||||||||
Income taxes payable | |||||||||||||||||
Total liabilities | ( | ) | |||||||||||||||
Equity | |||||||||||||||||
Stockholders’ equity | |||||||||||||||||
Common stock | ( | ) | |||||||||||||||
Additional paid-in capital | ( | ) | |||||||||||||||
Retained earnings (deficit) | ( | ) | ( | ) | |||||||||||||
Treasury stock, at cost | ( | ) | ( | ) | |||||||||||||
Accumulated other comprehensive income | |||||||||||||||||
Total stockholders’ equity | ( | ) | |||||||||||||||
Noncontrolling interest | |||||||||||||||||
Total equity | ( | ) | |||||||||||||||
( | ) |
Toll Brothers, Inc. | Subsidiary Issuer | Guarantor Subsidiaries | Nonguarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||
Revenues: | |||||||||||||||||
Home sales | |||||||||||||||||
Land sales and other | ( | ) | |||||||||||||||
( | ) | ||||||||||||||||
Cost of revenues: | |||||||||||||||||
Home sales | ( | ) | |||||||||||||||
Land sales and other | ( | ) | |||||||||||||||
( | ) | ||||||||||||||||
Selling, general and administrative | ( | ) | |||||||||||||||
Income (loss) from operations | ( | ) | ( | ) | ( | ) | |||||||||||
Other: | |||||||||||||||||
Income from unconsolidated entities | |||||||||||||||||
Other income – net | |||||||||||||||||
Intercompany interest income | ( | ) | |||||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | |||||||||||
Income from subsidiaries | ( | ) | |||||||||||||||
Income before income taxes | ( | ) | |||||||||||||||
Income tax provision | ( | ) | |||||||||||||||
Net income | ( | ) | |||||||||||||||
Other comprehensive income | |||||||||||||||||
Total comprehensive income | ( | ) |
Toll Brothers, Inc. | Subsidiary Issuer | Guarantor Subsidiaries | Nonguarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||
Revenues | ( | ) | |||||||||||||||
Cost of revenues | ( | ) | |||||||||||||||
Selling, general and administrative | ( | ) | |||||||||||||||
( | ) | ||||||||||||||||
Income (loss) from operations | ( | ) | ( | ) | ( | ) | |||||||||||
Other: | |||||||||||||||||
Income from unconsolidated entities | |||||||||||||||||
Other income – net | |||||||||||||||||
Intercompany interest income | ( | ) | |||||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | |||||||||||
Income from subsidiaries | ( | ) | |||||||||||||||
Income before income taxes | ( | ) | |||||||||||||||
Income tax provision | ( | ) | |||||||||||||||
Net income | ( | ) | |||||||||||||||
Other comprehensive income | |||||||||||||||||
Total comprehensive income | ( | ) |
Toll Brothers, Inc. | Subsidiary Issuer | Guarantor Subsidiaries | Nonguarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||
Revenues: | |||||||||||||||||
Home sales | |||||||||||||||||
Land sales and other | ( | ) | |||||||||||||||
( | ) | ||||||||||||||||
Cost of revenues: | |||||||||||||||||
Home sales | ( | ) | |||||||||||||||
Land sales and other | ( | ) | |||||||||||||||
( | ) | ||||||||||||||||
Selling, general and administrative | ( | ) | |||||||||||||||
Income (loss) from operations | ( | ) | ( | ) | ( | ) | |||||||||||
Other: | |||||||||||||||||
Income from unconsolidated entities | |||||||||||||||||
Other income – net | |||||||||||||||||
Intercompany interest income | ( | ) | |||||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | |||||||||||
Income from subsidiaries | ( | ) | |||||||||||||||
Income before income taxes | ( | ) | |||||||||||||||
Income tax provision | ( | ) | |||||||||||||||
Net income | ( | ) | |||||||||||||||
Other comprehensive income | |||||||||||||||||
Total comprehensive income | ( | ) |
Toll Brothers, Inc. | Subsidiary Issuer | Guarantor Subsidiaries | Nonguarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||
Revenues | ( | ) | |||||||||||||||
Cost of revenues | ( | ) | |||||||||||||||
Selling, general and administrative | ( | ) | |||||||||||||||
( | ) | ||||||||||||||||
Income (loss) from operations | ( | ) | ( | ) | ( | ) | |||||||||||
Other: | |||||||||||||||||
Income from unconsolidated entities | |||||||||||||||||
Other income – net | |||||||||||||||||
Intercompany interest income | ( | ) | |||||||||||||||
Interest expense | ( | ) | ( | ) | ( | ) | |||||||||||
Income from subsidiaries | ( | ) | |||||||||||||||
Income before income taxes | ( | ) | |||||||||||||||
Income tax provision (benefit) | ( | ) | ( | ) | |||||||||||||
Net income | ( | ) | |||||||||||||||
Other comprehensive income | |||||||||||||||||
Total comprehensive income | ( | ) |
Toll Brothers, Inc. | Subsidiary Issuer | Guarantor Subsidiaries | Nonguarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||
Net cash used in operating activities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||
Cash flow provided by (used in) investing activities: | |||||||||||||||||
Purchase of property and equipment - net | ( | ) | ( | ) | |||||||||||||
Investments in unconsolidated entities | ( | ) | ( | ) | ( | ) | |||||||||||
Return of investments in unconsolidated entities | |||||||||||||||||
Investment in foreclosed real estate and distressed loans | ( | ) | ( | ) | |||||||||||||
Return of investments in foreclosed real estate and distressed loans | |||||||||||||||||
Proceeds from sales of golf club property and an office building | |||||||||||||||||
Investment paid - intercompany | ( | ) | |||||||||||||||
Intercompany advances | ( | ) | |||||||||||||||
Net cash provided by (used in) investing activities | ( | ) | ( | ) | |||||||||||||
Cash flow provided by (used in) financing activities: | |||||||||||||||||
Proceeds from loans payable | |||||||||||||||||
Debt issuance costs for loans payable | ( | ) | ( | ) | |||||||||||||
Principal payments of loans payable | ( | ) | ( | ) | ( | ) | |||||||||||
Redemption of senior notes | ( | ) | ( | ) | |||||||||||||
Proceeds from stock-based benefit plans, net | |||||||||||||||||
Purchase of treasury stock | ( | ) | ( | ) | |||||||||||||
Dividends paid | ( | ) | ( | ) | |||||||||||||
Receipts related to noncontrolling interest, net | |||||||||||||||||
Investment received - intercompany | ( | ) | |||||||||||||||
Intercompany advances | ( | ) | ( | ) | |||||||||||||
Net cash (used in) provided by financing activities | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | |||||||
Net (decrease) increase in cash, cash equivalents, and restricted cash | ( | ) | ( | ) | |||||||||||||
Cash, cash equivalents, and restricted cash, beginning of period | |||||||||||||||||
Cash and cash equivalents, end of period |
Toll Brothers, Inc. | Subsidiary Issuer | Guarantor Subsidiaries | Nonguarantor Subsidiaries | Eliminations | Consolidated | ||||||||||||
Net cash (used in) provided by operating activities | ( | ) | ( | ) | ( | ) | ( | ) | |||||||||
Cash flow provided by (used in) investing activities: | |||||||||||||||||
Purchase of property and equipment — net | ( | ) | ( | ) | |||||||||||||
Investments in unconsolidated entities | ( | ) | ( | ) | ( | ) | |||||||||||
Return of investments in unconsolidated entities | |||||||||||||||||
Investment in foreclosed real estate and distressed loans | ( | ) | ( | ) | |||||||||||||
Return of investments in foreclosed real estate and distressed loans | |||||||||||||||||
Intercompany advances | ( | ) | |||||||||||||||
Net cash provided by (used in) investing activities | ( | ) | |||||||||||||||
Cash flow provided by (used in) financing activities: | |||||||||||||||||
Proceeds from issuance of senior notes | |||||||||||||||||
Debt issuance costs for senior notes | ( | ) | ( | ) | |||||||||||||
Proceeds from loans payable | |||||||||||||||||
Principal payments of loans payable | ( | ) | ( | ) | ( | ) | |||||||||||
Proceeds from stock-based benefit plans, net | |||||||||||||||||
Purchase of treasury stock | ( | ) | ( | ) | |||||||||||||
Dividends paid | ( | ) | ( | ) | |||||||||||||
Intercompany advances | ( | ) | ( | ) | |||||||||||||
Net cash provided by (used in) financing activities | ( | ) | ( | ) | ( | ) | |||||||||||
Net (decrease) increase in cash, cash equivalents, and restricted cash | ( | ) | ( | ) | |||||||||||||
Cash, cash equivalents, and restricted cash, beginning of period | |||||||||||||||||
Cash, cash equivalents, and restricted cash, end of period |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||
Revenues:(1) | |||||||||||||||||||||
Home sales | $ | 3,031.4 | $ | 2,774.7 | 9 | % | $ | 1,712.1 | $ | 1,599.2 | 7 | % | |||||||||
Land sales | 47.9 | — | 4.0 | — | |||||||||||||||||
3,079.3 | 2,774.7 | 11 | % | 1,716.1 | 1,599.2 | ||||||||||||||||
Cost of revenues:(1) | |||||||||||||||||||||
Home sales | 2,416.6 | 2,232.6 | 8 | % | 1,374.3 | 1,298.2 | 6 | % | |||||||||||||
Land sales | 37.2 | — | 2.9 | — | |||||||||||||||||
2,453.8 | 2,232.6 | 10 | % | 1,377.3 | 1,298.2 | ||||||||||||||||
Selling, general and administrative | 340.6 | 323.9 | 5 | % | 178.4 | 166.7 | 7 | % | |||||||||||||
Income from operations | 284.9 | 218.1 | 31 | % | 160.5 | 134.4 | 19 | % | |||||||||||||
Other | |||||||||||||||||||||
Income from unconsolidated entities | 10.6 | 41.4 | (75 | )% | 4.4 | 2.6 | 72 | % | |||||||||||||
Other income – net | 32.1 | 24.8 | 30 | % | 11.3 | 15.8 | (28 | )% | |||||||||||||
Income before income taxes | 327.6 | 284.3 | 15 | % | 176.2 | 152.7 | 15 | % | |||||||||||||
Income tax provision | 86.2 | 40.4 | 113 | % | 46.8 | 40.9 | 14 | % | |||||||||||||
Net income | $ | 241.4 | $ | 243.9 | (1 | )% | $ | 129.3 | $ | 111.8 | 16 | % | |||||||||
Supplemental information: | |||||||||||||||||||||
Home sales cost of revenues as a percentage of home sales revenues | 79.7 | % | 80.5 | % | 80.3 | % | 81.2 | % | |||||||||||||
Land sales cost of revenues as a percentage of land sales revenues (1) | 77.6 | % | 72.4 | % | |||||||||||||||||
SG&A as a percentage of home sale revenues | 11.2 | % | 11.7 | % | 10.4 | % | 10.4 | % | |||||||||||||
Effective tax rate | 26.3 | % | 14.2 | % | 26.6 | % | 26.8 | % | |||||||||||||
Deliveries – units | 3,441 | 3,309 | 4 | % | 1,911 | 1,886 | 1 | % | |||||||||||||
Deliveries – average delivered price (2) | $ | 881.0 | $ | 838.5 | 5 | % | $ | 895.9 | $ | 847.9 | 6 | % | |||||||||
Net contracts signed – value | $ | 3,166.6 | $ | 4,073.6 | (22 | )% | $ | 2,003.3 | $ | 2,383.2 | (16 | )% | |||||||||
Net contracts signed – units | 3,803 | 4,488 | (15 | )% | 2,424 | 2,666 | (9 | )% | |||||||||||||
Net contracts signed – average selling price (2) | $ | 832.7 | $ | 907.7 | (8 | )% | $ | 826.4 | $ | 893.9 | (8 | )% | |||||||||
April 30, 2019 | April 30, 2018 | % Change | October 31, 2018 | October 31, 2017 | % Change | ||||||||||||||||
Backlog – value | $ | 5,661.7 | $ | 6,360.4 | (11 | )% | $ | 5,522.5 | $ | 5,061.5 | 9 | % | |||||||||
Backlog – units | 6,467 | 7,030 | (8 | )% | 6,105 | 5,851 | 4 | % | |||||||||||||
Backlog – average selling price (2) | $ | 875.5 | $ | 904.8 | (3 | )% | $ | 904.6 | $ | 865.1 | 5 | % |
(1) | On November 1, 2018, we adopted ASC 606. Upon adoption, land sale activity is presented as part of income from operations where previously it was included in “Other income – net.” During the six months ended April 30, 2018, we recognized land sales revenues and land sales cost of revenues of $41.4 million and $38.1 million, respectively. During the three months ended April 30, 2018, we recognized land sales revenues and land sales cost of revenues of $34.4 million and $31.8 million, respectively. Further, retained customer deposits, which totaled $6.4 million and $3.2 million during the six months and three months ended April 30, 2019, respectively, are included in “Home sales revenue” where previously they were included in “Other income – net.” During the six months and three months ended April 30, 2018, retained customer deposits were $4.2 million and $3.1 million, respectively. Prior period balances have not been restated. |
(2) | $ amounts in thousands. |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
Income from ancillary businesses | $ | 18,086 | $ | 7,456 | $ | 4,242 | $ | 4,873 | |||||||
Management fee income from home building unconsolidated entities, net | 4,727 | 7,425 | 3,119 | 4,354 | |||||||||||
Income from land sales | 3,287 | 2,587 | |||||||||||||
Retained customer deposits | 4,155 | 3,071 | |||||||||||||
Other | 9,333 | 2,468 | 3,924 | 909 | |||||||||||
Total other income – net | $ | 32,146 | $ | 24,791 | $ | 11,285 | $ | 15,794 |
Six months ended April 30, | ||||||||||||||||||||||||||||||
Revenues ($ in millions) | Units Delivered | Average Delivered Price ($ in thousands) | ||||||||||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||||||||
Traditional Home Building: | ||||||||||||||||||||||||||||||
North | $ | 391.4 | $ | 360.5 | 9 | % | 553 | 547 | 1 | % | $ | 707.8 | $ | 659.0 | 7 | % | ||||||||||||||
Mid-Atlantic | 461.4 | 461.9 | — | % | 692 | 730 | (5 | )% | $ | 666.8 | $ | 632.7 | 5 | % | ||||||||||||||||
South | 492.5 | 412.2 | 19 | % | 661 | 540 | 22 | % | $ | 745.1 | $ | 763.3 | (2 | )% | ||||||||||||||||
West | 665.3 | 607.4 | 10 | % | 922 | 944 | (2 | )% | $ | 721.6 | $ | 643.4 | 12 | % | ||||||||||||||||
California | 870.6 | 725.5 | 20 | % | 477 | 455 | 5 | % | $ | 1,825.2 | $ | 1,594.5 | 14 | % | ||||||||||||||||
Traditional Home Building | 2,881.2 | 2,567.5 | 12 | % | 3,305 | 3,216 | 3 | % | $ | 871.8 | $ | 798.4 | 9 | % | ||||||||||||||||
City Living | 152.7 | 207.2 | (26 | )% | 136 | 93 | 46 | % | $ | 1,122.8 | $ | 2,228.0 | (50 | )% | ||||||||||||||||
Other | (2.5 | ) | ||||||||||||||||||||||||||||
Total home sales revenue | 3,031.4 | 2,774.7 | 9 | % | 3,441 | 3,309 | 4 | % | $ | 881.0 | $ | 838.5 | 5 | % | ||||||||||||||||
Land sales revenue | 47.9 | |||||||||||||||||||||||||||||
Total revenue | $ | 3,079.3 | $ | 2,774.7 |
Three months ended April 30, | ||||||||||||||||||||||||||||||
Revenues ($ in millions) | Units Delivered | Average Delivered Price ($ in thousands) | ||||||||||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||||||||
Traditional Home Building: | ||||||||||||||||||||||||||||||
North | $ | 221.9 | $ | 226.2 | (2 | )% | 316 | 338 | (7 | )% | $ | 702.2 | $ | 669.3 | 5 | % | ||||||||||||||
Mid-Atlantic | 255.7 | 254.9 | — | % | 387 | 398 | (3 | )% | $ | 660.7 | $ | 640.5 | 3 | % | ||||||||||||||||
South | 284.4 | 240.7 | 18 | % | 380 | 319 | 19 | % | $ | 748.3 | $ | 754.6 | (1 | )% | ||||||||||||||||
West | 364.9 | 349.4 | 4 | % | 488 | 532 | (8 | )% | $ | 747.7 | $ | 656.7 | 14 | % | ||||||||||||||||
California | 500.5 | 438.4 | 14 | % | 268 | 270 | (1 | )% | $ | 1,867.7 | $ | 1,623.5 | 15 | % | ||||||||||||||||
Traditional Home Building | 1,627.4 | 1,509.6 | 8 | % | 1,839 | 1,857 | (1 | )% | $ | 884.9 | $ | 812.9 | 9 | % | ||||||||||||||||
City Living | 84.1 | 89.6 | (6 | )% | 72 | 29 | 148 | % | $ | 1,167.7 | $ | 3,090.8 | (62 | )% | ||||||||||||||||
Other | 0.6 | |||||||||||||||||||||||||||||
Total home sales revenue | 1,712.1 | 1,599.2 | 7 | % | 1,911 | 1,886 | 1 | % | $ | 895.9 | $ | 847.9 | 6 | % | ||||||||||||||||
Land sales revenue | 4.0 | |||||||||||||||||||||||||||||
Total revenue | $ | 1,716.1 | $ | 1,599.2 |
Six months ended April 30, | ||||||||||||||||||||||||||||||
Net Contract Value ($ in millions) | Net Contracted Units | Average Contracted Price ($ in thousands) | ||||||||||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||||||||
Traditional Home Building: | ||||||||||||||||||||||||||||||
North | $ | 457.0 | $ | 450.0 | 2 | % | 648 | 634 | 2 | % | $ | 705.2 | $ | 709.8 | (1 | )% | ||||||||||||||
Mid-Atlantic | 567.5 | 559.9 | 1 | % | 877 | 872 | 1 | % | $ | 647.1 | $ | 642.1 | 1 | % | ||||||||||||||||
South | 543.5 | 578.5 | (6 | )% | 766 | 769 | — | % | $ | 709.5 | $ | 752.3 | (6 | )% | ||||||||||||||||
West | 721.3 | 779.0 | (7 | )% | 994 | 1,149 | (13 | )% | $ | 725.7 | $ | 678.0 | 7 | % | ||||||||||||||||
California | 774.6 | 1,547.2 | (50 | )% | 454 | 952 | (52 | )% | $ | 1,706.2 | $ | 1,625.2 | 5 | % | ||||||||||||||||
Traditional Home Building | 3,063.9 | 3,914.6 | (22 | )% | 3,739 | 4,376 | (15 | )% | $ | 819.4 | $ | 894.6 | (8 | )% | ||||||||||||||||
City Living | 102.7 | 159.0 | (35 | )% | 64 | 112 | (43 | )% | $ | 1,604.7 | $ | 1,419.6 | 13 | % | ||||||||||||||||
Total | $ | 3,166.6 | $ | 4,073.6 | (22 | )% | 3,803 | 4,488 | (15 | )% | $ | 832.7 | $ | 907.7 | (8 | )% |
Three months ended April 30, | ||||||||||||||||||||||||||||||
Net Contract Value ($ in millions) | Net Contracted Units | Average Contracted Price ($ in thousands) | ||||||||||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||||||||
Traditional Home Building: | ||||||||||||||||||||||||||||||
North | $ | 285.5 | $ | 252.5 | 13 | % | 407 | 363 | 12 | % | $ | 701.4 | $ | 695.6 | 1 | % | ||||||||||||||
Mid-Atlantic | 346.5 | 347.8 | — | % | 530 | 548 | (3 | )% | $ | 653.7 | $ | 634.6 | 3 | % | ||||||||||||||||
South | 348.1 | 339.5 | 3 | % | 498 | 466 | 7 | % | $ | 698.9 | $ | 728.4 | (4 | )% | ||||||||||||||||
West | 454.4 | 445.1 | 2 | % | 643 | 660 | (3 | )% | $ | 706.8 | $ | 674.4 | 5 | % | ||||||||||||||||
California | 505.7 | 901.2 | (44 | )% | 305 | 564 | (46 | )% | $ | 1,657.9 | $ | 1,597.9 | 4 | % | ||||||||||||||||
Traditional Home Building | 1,940.2 | 2,286.1 | (15 | )% | 2,383 | 2,601 | (8 | )% | $ | 814.2 | $ | 878.9 | (7 | )% | ||||||||||||||||
City Living | 63.1 | 97.1 | (35 | )% | 41 | 65 | (37 | )% | $ | 1,538.9 | $ | 1,494.3 | 3 | % | ||||||||||||||||
Total | $ | 2,003.3 | $ | 2,383.2 | (16 | )% | 2,424 | 2,666 | (9 | )% | $ | 826.4 | $ | 893.9 | (8 | )% |
At April 30, | ||||||||||||||||||||||||||||||
Backlog Value ($ in millions) | Backlog Units | Average Backlog Price ($ in thousands) | ||||||||||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||||||||
Traditional Home Building: | ||||||||||||||||||||||||||||||
North | $ | 834.8 | $ | 905.6 | (8 | )% | 1,193 | 1,304 | (9 | )% | $ | 699.7 | $ | 694.5 | 1 | % | ||||||||||||||
Mid-Atlantic | 865.5 | 839.7 | 3 | % | 1,327 | 1,285 | 3 | % | $ | 652.2 | $ | 653.4 | — | % | ||||||||||||||||
South | 955.5 | 982.2 | (3 | )% | 1,271 | 1,284 | (1 | )% | $ | 751.8 | $ | 765.0 | (2 | )% | ||||||||||||||||
West | 1,088.3 | 1,143.6 | (5 | )% | 1,472 | 1,602 | (8 | )% | $ | 739.3 | $ | 713.8 | 4 | % | ||||||||||||||||
California | 1,789.9 | 2,316.8 | (23 | )% | 1,110 | 1,384 | (20 | )% | $ | 1,612.6 | $ | 1,674.0 | (4 | )% | ||||||||||||||||
Traditional Home Building | 5,534.0 | 6,187.9 | (11 | )% | 6,373 | 6,859 | (7 | )% | $ | 868.4 | $ | 902.2 | (4 | )% | ||||||||||||||||
City Living | 127.7 | 172.5 | (26 | )% | 94 | 171 | (45 | )% | $ | 1,358.4 | $ | 1,009.0 | 35 | % | ||||||||||||||||
Total | $ | 5,661.7 | $ | 6,360.4 | (11 | )% | 6,467 | 7,030 | (8 | )% | $ | 875.5 | $ | 904.8 | (3 | )% |
At October 31, | ||||||||||||||||||||||||||||||
Backlog Value ($ in millions) | Backlog Units | Average Backlog Price ($ in thousands) | ||||||||||||||||||||||||||||
2018 | 2017 | % Change | 2018 | 2017 | % Change | 2018 | 2017 | % Change | ||||||||||||||||||||||
Traditional Home Building: | ||||||||||||||||||||||||||||||
North | $ | 768.5 | $ | 816.1 | (6 | )% | 1,098 | 1,217 | (10 | )% | $ | 699.9 | $ | 670.6 | 4 | % | ||||||||||||||
Mid-Atlantic | 758.8 | 741.6 | 2 | % | 1,142 | 1,143 | — | % | $ | 664.4 | $ | 648.8 | 2 | % | ||||||||||||||||
South | 903.2 | 815.9 | 11 | % | 1,166 | 1,055 | 11 | % | $ | 774.6 | $ | 773.4 | — | % | ||||||||||||||||
West | 1,031.1 | 972.0 | 6 | % | 1,400 | 1,397 | — | % | $ | 736.5 | $ | 695.7 | 6 | % | ||||||||||||||||
California | 1,883.3 | 1,495.1 | 26 | % | 1,133 | 887 | 28 | % | $ | 1,662.2 | $ | 1,685.6 | (1 | )% | ||||||||||||||||
Traditional Home Building | 5,344.9 | 4,840.7 | 10 | % | 5,939 | 5,699 | 4 | % | $ | 900.0 | $ | 849.4 | 6 | % | ||||||||||||||||
City Living | 177.6 | 220.8 | (20 | )% | 166 | 152 | 9 | % | $ | 1,069.7 | $ | 1,452.7 | (26 | )% | ||||||||||||||||
Total | $ | 5,522.5 | $ | 5,061.5 | 9 | % | 6,105 | 5,851 | 4 | % | $ | 904.6 | $ | 865.1 | 5 | % |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | ||||||||||||||||
Traditional Home Building: | |||||||||||||||||||||
North | $ | 18.0 | $ | 2.0 | 800 | % | $ | 7.3 | $ | 1.7 | 329 | % | |||||||||
Mid-Atlantic | 18.9 | 34.3 | (45 | )% | 7.5 | 20.4 | (63 | )% | |||||||||||||
South | 47.3 | 39.3 | 20 | % | 31.5 | 27.1 | 16 | % | |||||||||||||
West | 87.4 | 78.7 | 11 | % | 43.8 | 48.0 | (9 | )% | |||||||||||||
California | 180.2 | 146.5 | 23 | % | 106.6 | 85.7 | 24 | % | |||||||||||||
Traditional Home Building | 351.8 | 300.8 | 17 | % | 196.7 | 182.9 | 8 | % | |||||||||||||
City Living | 40.5 | 46.6 | (13 | )% | 25.9 | 16.7 | 55 | % | |||||||||||||
Corporate and other | (64.7 | ) | (63.1 | ) | (3 | )% | (46.4 | ) | (46.9 | ) | (1 | )% | |||||||||
Total | $ | 327.6 | $ | 284.3 | 15 | % | $ | 176.2 | $ | 152.7 | 15 | % |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | ||||||||||||||||
Units Delivered and Revenues: | |||||||||||||||||||||
Home sales revenues ($ in millions) | $ | 391.4 | $ | 360.5 | 9 | % | $ | 221.9 | $ | 226.2 | (2 | )% | |||||||||
Units delivered | 553 | 547 | 1 | % | 316 | 338 | (7 | )% | |||||||||||||
Average delivered price ($ in thousands) | $ | 707.8 | $ | 659.0 | 7 | % | $ | 702.2 | $ | 669.3 | 5 | % | |||||||||
Net Contracts Signed: | |||||||||||||||||||||
Net contract value ($ in millions) | $ | 457.0 | $ | 450.0 | 2 | % | $ | 285.5 | $ | 252.5 | 13 | % | |||||||||
Net contracted units | 648 | 634 | 2 | % | 407 | 363 | 12 | % | |||||||||||||
Average contracted price ($ in thousands) | $ | 705.2 | $ | 709.8 | (1 | )% | $ | 701.4 | $ | 695.6 | 1 | % | |||||||||
Home sales cost of revenues as a percentage of home sale revenues | 85.8 | % | 90.1 | % | 88.2 | % | 91.8 | % | |||||||||||||
Income before income taxes ($ in millions) | $ | 18.0 | $ | 2.0 | 800 | % | $ | 7.3 | $ | 1.7 | 329 | % | |||||||||
Number of selling communities at April 30, | 53 | 48 | 10 | % |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | ||||||||||||||||
Units Delivered and Revenues: | |||||||||||||||||||||
Home sales revenues ($ in millions) | $ | 461.4 | $ | 461.9 | — | % | $ | 255.7 | $ | 254.9 | — | % | |||||||||
Units delivered | 692 | 730 | (5 | )% | 387 | 398 | (3 | )% | |||||||||||||
Average delivered price ($ in thousands) | $ | 666.8 | $ | 632.7 | 5 | % | $ | 660.7 | $ | 640.5 | 3 | % | |||||||||
Net Contracts Signed: | |||||||||||||||||||||
Net contract value ($ in millions) | $ | 567.5 | $ | 559.9 | 1 | % | $ | 346.5 | $ | 347.8 | — | % | |||||||||
Net contracted units | 877 | 872 | 1 | % | 530 | 548 | (3 | )% | |||||||||||||
Average contracted price ($ in thousands) | $ | 647.1 | $ | 642.1 | 1 | % | $ | 653.7 | $ | 634.6 | 3 | % | |||||||||
Home sales cost of revenues as a percentage of home sale revenues | 86.8 | % | 84.0 | % | 88.8 | % | 84.0 | % | |||||||||||||
Income before income taxes ($ in millions) | $ | 18.9 | $ | 34.3 | (45 | )% | $ | 7.5 | $ | 20.4 | (63 | )% | |||||||||
Number of selling communities at April 30, | 54 | 57 | (5 | )% |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | ||||||||||||||||
Units Delivered and Revenues: | |||||||||||||||||||||
Home sales revenues ($ in millions) | $ | 492.5 | $ | 412.2 | 19 | % | $ | 284.4 | $ | 240.7 | 18 | % | |||||||||
Units delivered | 661 | 540 | 22 | % | 380 | 319 | 19 | % | |||||||||||||
Average delivered price ($ in thousands) | $ | 745.1 | $ | 763.3 | (2 | )% | $ | 748.3 | $ | 754.6 | (1 | )% | |||||||||
Net Contracts Signed: | |||||||||||||||||||||
Net contract value ($ in millions) | $ | 543.5 | $ | 578.5 | (6 | )% | $ | 348.1 | $ | 339.5 | 3 | % | |||||||||
Net contracted units | 766 | 769 | — | % | 498 | 466 | 7 | % | |||||||||||||
Average contracted price ($ in thousands) | $ | 709.5 | $ | 752.3 | (6 | )% | $ | 698.9 | $ | 728.4 | (4 | )% | |||||||||
Home sales cost of revenues as a percentage of home sale revenues | 83.6 | % | 83.3 | % | 82.8 | % | 82.5 | % | |||||||||||||
Income before income taxes ($ in millions) | $ | 47.3 | $ | 39.3 | 20 | % | $ | 31.5 | $ | 27.1 | 16 | % | |||||||||
Number of selling communities at April 30, | 71 | 62 | 15 | % |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | ||||||||||||||||
Units Delivered and Revenues: | |||||||||||||||||||||
Home sales revenues ($ in millions) | $ | 665.3 | $ | 607.4 | 10 | % | $ | 364.9 | $ | 349.4 | 4 | % | |||||||||
Units delivered | 922 | 944 | (2 | )% | 488 | 532 | (8 | )% | |||||||||||||
Average delivered price ($ in thousands) | $ | 721.6 | $ | 643.4 | 12 | % | $ | 747.7 | $ | 656.7 | 14 | % | |||||||||
Net Contracts Signed: | |||||||||||||||||||||
Net contract value ($ in millions) | $ | 721.3 | $ | 779.0 | (7 | )% | $ | 454.4 | $ | 445.1 | 2 | % | |||||||||
Net contracted units | 994 | 1,149 | (13 | )% | 643 | 660 | (3 | )% | |||||||||||||
Average contracted price ($ in thousands) | $ | 725.7 | $ | 678.0 | 7 | % | $ | 706.8 | $ | 674.4 | 5 | % | |||||||||
Home sales cost of revenues as a percentage of home sale revenues | 78.2 | % | 79.2 | % | 79.5 | % | 79.2 | % | |||||||||||||
Income before income taxes ($ in millions) | $ | 87.4 | $ | 78.7 | 11 | % | $ | 43.8 | $ | 48.0 | (9 | )% | |||||||||
Number of selling communities at April 30, | 89 | 72 | 24 | % |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | ||||||||||||||||
Units Delivered and Revenues: | |||||||||||||||||||||
Home sales revenues ($ in millions) | $ | 870.6 | $ | 725.5 | 20 | % | $ | 500.5 | $ | 438.4 | 14 | % | |||||||||
Units delivered | 477 | 455 | 5 | % | 268 | 270 | (1 | )% | |||||||||||||
Average delivered price ($ in thousands) | $ | 1,825.2 | $ | 1,594.5 | 14 | % | $ | 1,867.7 | $ | 1,623.5 | 15 | % | |||||||||
Net Contracts Signed: | |||||||||||||||||||||
Net contract value ($ in millions) | $ | 774.6 | $ | 1,547.2 | (50 | )% | $ | 505.7 | $ | 901.2 | (44 | )% | |||||||||
Net contracted units | 454 | 952 | (52 | )% | 305 | 564 | (46 | )% | |||||||||||||
Average contracted price ($ in thousands) | $ | 1,706.2 | $ | 1,625.2 | 5 | % | $ | 1,657.9 | $ | 1,597.9 | 4 | % | |||||||||
Home sales cost of revenues as a percentage of home sale revenues | 73.8 | % | 73.6 | % | 73.7 | % | 74.5 | % | |||||||||||||
Income before income taxes ($ in millions) | $ | 180.2 | $ | 146.5 | 23 | % | $ | 106.6 | $ | 85.7 | 24 | % | |||||||||
Number of selling communities at April 30, | 40 | 38 | 5 | % |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||
2019 | 2018 | Change | 2019 | 2018 | Change | ||||||||||||||||
Units Delivered and Revenues: | |||||||||||||||||||||
Home sales revenues ($ in millions) | $ | 152.7 | $ | 207.2 | (26 | )% | $ | 84.1 | $ | 89.6 | (6 | )% | |||||||||
Units delivered | 136 | 93 | 46 | % | 72 | 29 | 148 | % | |||||||||||||
Average delivered price ($ in thousands) | $ | 1,122.8 | $ | 2,228.0 | (50 | )% | $ | 1,167.7 | $ | 3,090.8 | (62 | )% | |||||||||
Net Contracts Signed: | |||||||||||||||||||||
Net contract value ($ in millions) | $ | 102.7 | $ | 159.0 | (35 | )% | $ | 63.1 | $ | 97.1 | (35 | )% | |||||||||
Net contracted units | 64 | 112 | (43 | )% | 41 | 65 | (37 | )% | |||||||||||||
Average contracted price ($ in thousands) | $ | 1,604.7 | $ | 1,419.6 | 13 | % | $ | 1,538.9 | $ | 1,494.3 | 3 | % | |||||||||
Home sales cost of revenues as a percentage of home sale revenues | 70.3 | % | 76.6 | % | 65.6 | % | 81.1 | % | |||||||||||||
Income before income taxes ($ in millions) | $ | 40.5 | $ | 46.6 | (13 | )% | $ | 25.9 | $ | 16.7 | 55 | % | |||||||||
Number of selling communities at April 30, | 4 | 6 | (33 | )% |
Six months ended April 30, | Three months ended April 30, | ||||||||||||||||||||||||||
2019 Units | 2018 Units | 2019 $ | 2018 $ | 2019 Units | 2018 Units | 2019 $ | 2018 $ | ||||||||||||||||||||
Deliveries | 42 | 5 | $ | 91.5 | $ | 21.5 | 38 | 2 | $ | 74.3 | $ | 10.8 | |||||||||||||||
Net contracts signed | 15 | 74 | $ | 53.4 | $ | 148.4 | 13 | 18 | $ | 43.8 | $ | 45.8 |
At April 30, | At October 31, | ||||||||||||||||||||||||||
2019 Units | 2018 Units | 2019 $ | 2018 $ | 2018 Units | 2017 Units | 2018 $ | 2017 $ | ||||||||||||||||||||
Backlog | 107 | 115 | $ | 240.9 | $ | 226.0 | 134 | 46 | $ | 279.0 | $ | 99.1 |
Fixed-rate debt | Variable-rate debt (a) | |||||||||||
Fiscal year of maturity | Amount | Weighted- average interest rate | Amount | Weighted- average interest rate | ||||||||
2019 | $ | 20,930 | 3.76% | $ | — | |||||||
2020 | 282,302 | 6.56% | 110,162 | 4.38% | ||||||||
2021 | 24,675 | 5.25% | 150 | 2.15% | ||||||||
2022 | 432,917 | 5.85% | 150 | 2.15% | ||||||||
2023 | 415,370 | 4.41% | 150 | 2.15% | ||||||||
Thereafter | 1,560,477 | 4.89% | 812,910 | 3.79% | ||||||||
Bond discounts, premiums and deferred issuance costs, net | (7,472 | ) | (2,897 | ) | ||||||||
Total | $ | 2,729,199 | 5.14% | $ | 920,625 | 3.86% | ||||||
Fair value at April 30, 2019 | $ | 2,788,996 | $ | 923,522 |
(a) | Based upon the amount of variable-rate debt outstanding at April 30, 2019, and holding the variable-rate debt balance constant, each 1% increase in interest rates would increase the interest incurred by us by approximately $9.2 million per year. |
Period | Total number of shares purchased (a) | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs (b) | Maximum number of shares that may yet be purchased under the plans or programs (b) | |||||||||
(in thousands) | (in thousands) | (in thousands) | |||||||||||
February 1, 2019 to February 28, 2019 | 1 | $ | 37.18 | 1 | 19,786 | ||||||||
March 1, 2019 to March 31, 2019 | 1 | $ | 35.60 | 1 | 19,785 | ||||||||
April 1, 2019 to April 30, 2019 | 1 | $ | 38.46 | 1 | 19,784 | ||||||||
Total | 3 | $ | 36.95 | 3 |
(a) | Our stock incentive plans permit us to withhold from the total number of shares that otherwise would be issued to a performance based restricted stock unit recipient or a restricted stock unit recipient upon distribution that number of shares having a fair value at the time of distribution equal to the applicable income tax withholdings due and remit the remaining shares to the recipient. During the three months ended April 30, 2019, we withheld 1,146 of the shares subject to performance based restricted stock units and restricted stock units to cover approximately $41,500 of income tax withholdings and we issued the remaining 2,823 shares to the recipients. The shares withheld are not included in the total number of shares purchased in the table above. |
(b) | On December 12, 2018, our Board of Directors authorized the repurchase of 20 million shares of our common stock in open market transactions or otherwise for general corporate purposes, including to obtain shares for the Company’s equity award and other employee benefit plans. Our Board of Directors did not fix any expiration date for this repurchase program. At the time it authorized the new program, our Board of Directors terminated the existing 20 million share repurchase program authorized in December 2017. |
10.1 | |
10.2 | |
31.1* | |
31.2* | |
32.1* | |
32.2* | |
101 | The following financial statements from Toll Brothers, Inc. Quarterly Report on Form 10-Q for the quarter ended April 30, 2019, filed on June 6, 2019, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations and Comprehensive Income, (iii) Condensed Consolidated Statements of Changes in Equity, (iv) Condensed Consolidated Statements of Cash Flows, and (v) the Notes to Condensed Consolidated Financial Statements |
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |
* | Filed electronically herewith. |
TOLL BROTHERS, INC. | ||||
(Registrant) | ||||
Date: | June 6, 2019 | By: | /s/ Martin P. Connor | |
Martin P. Connor Senior Vice President and Chief Financial Officer (Principal Financial Officer) | ||||
Date: | June 6, 2019 | By: | /s/ Michael J. Grubb | |
Michael J. Grubb Senior Vice President and Chief Accounting Officer (Principal Accounting Officer) |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Signed: | /s/ Douglas C. Yearley, Jr. | ||
Name: Douglas C. Yearley, Jr. Title: Chief Executive Officer |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Signed: | /s/ Martin P. Connor | ||
Name: Martin P. Connor Title: Chief Financial Officer |
By: | /s/ Douglas C. Yearley Jr. | |
Name: Douglas C. Yearley, Jr. Title: Chief Executive Officer |
By: | /s/ Martin P. Connor | |
Name: Martin P. Connor Title: Chief Financial Officer |
Document and Entity Information - shares |
6 Months Ended | |
---|---|---|
Apr. 30, 2019 |
Jun. 04, 2019 |
|
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Toll Brothers, Inc. | |
Entity Central Index Key | 0000794170 | |
Current Fiscal Year End Date | --10-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Apr. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding | 143,870,000 |
Condensed Consolidated Balance Sheets (Parenthetical) - shares shares in Thousands |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, shares issued | 0 | 0 |
Common stock, shares issued | 177,937 | 177,937 |
Treasury stock, at cost | 31,907 | 31,774 |
Condensed Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Revenues | $ 1,716,094 | $ 1,599,199 | $ 3,079,275 | $ 2,774,667 |
Cost of revenues | 1,377,268 | 1,298,157 | 2,453,766 | 2,232,637 |
Selling, general and administrative | 178,371 | 166,652 | 340,609 | 323,919 |
Income from operations | 160,455 | 134,390 | 284,900 | 218,111 |
Other: | ||||
Income from unconsolidated entities | 4,419 | 2,564 | 10,559 | 41,444 |
Other income - net | 11,285 | 15,794 | 32,146 | 24,791 |
Income before income taxes | 176,159 | 152,748 | 327,605 | 284,346 |
Income tax provision | 46,835 | 40,938 | 86,231 | 40,429 |
Net income | 129,324 | 111,810 | 241,374 | 243,917 |
Other comprehensive income, net of tax: | ||||
Other comprehensive income, net | 56 | 170 | 112 | 341 |
Total comprehensive income | $ 129,380 | $ 111,980 | $ 241,486 | $ 244,258 |
Per share: | ||||
Basic earnings | $ 0.88 | $ 0.73 | $ 1.65 | $ 1.58 |
Diluted earnings | $ 0.87 | $ 0.72 | $ 1.63 | $ 1.55 |
Weighted average number of shares: | ||||
Basic | 146,622 | 152,731 | 146,687 | 154,306 |
Diluted | 148,129 | 155,129 | 148,081 | 157,013 |
Home Building [Member] | ||||
Revenues | $ 1,712,057 | $ 1,599,199 | $ 3,031,365 | $ 2,774,667 |
Cost of revenues | 1,374,347 | 1,298,157 | 2,416,592 | 2,232,637 |
Land [Member] | ||||
Revenues | 4,037 | 0 | 47,910 | 0 |
Cost of revenues | $ 2,921 | $ 0 | $ 37,174 | $ 0 |
Significant Accounting Policies |
6 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 30, 2019 | |||||||||||||
Accounting Policies [Abstract] | |||||||||||||
Significant Accounting Policies [Text Block] | Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of Toll Brothers, Inc. (the “Company,” “we,” “us,” or “our”), a Delaware corporation, and its majority owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Investments in 50% or less owned partnerships and affiliates are accounted for using the equity method unless it is determined that we have effective control of the entity, in which case we would consolidate the entity. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. The October 31, 2018 balance sheet amounts and disclosures included herein have been derived from our October 31, 2018 audited financial statements. Since the accompanying condensed consolidated financial statements do not include all the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements, they should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended October 31, 2018 (“2018 Form 10-K”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, which are of a normal recurring nature, necessary to present fairly our financial position as of April 30, 2019; the results of our operations and changes in equity for the six-month and three-month periods ended April 30, 2019 and 2018; and our cash flows for the six-month periods ended April 30, 2019 and 2018. The results of operations for such interim periods are not necessarily indicative of the results to be expected for the full year. Revenue Recognition As discussed under “Recent Accounting Pronouncements” below, on November 1, 2018, we adopted Accounting Standards Codification (“ASC”) Topic 606 “Revenue from Contracts with Customers” (“ASC 606”). As a result of this adoption, we updated our revenue recognition policies effective November 1, 2018, as follows: Home sales revenues: Revenues and cost of revenues from home sales are recognized at the time each home is delivered and title and possession are transferred to the buyer. For the majority of our home closings, our performance obligation to deliver a home is satisfied in less than one year from the date a binding sale agreement is signed. In certain states that we build, we are not able to complete certain outdoor features prior to the closing of the home. Effective November 1, 2018, to the extent these separate performance obligations are not complete upon the home closing, we defer a portion of the home sales revenues related to these obligations and subsequently recognize the revenue upon completion of such obligations. As of April 30, 2019, we deferred home sales revenues and related costs of $2.5 million and $1.9 million, respectively, related to obligations not completed on closed homes. Our contract liabilities, consisting of deposits received from customers for sold but undelivered homes, totaled $419.5 million, $406.4 million, and $410.9 million at April 30, 2019, January 31, 2019, and October 31, 2018, respectively. Of the outstanding customer deposits held as of October 31, 2018, we recognized $204.4 million in home sales revenues during the six months ended April 30, 2019. Of the outstanding customer deposits held as of January 31, 2019, we recognized $124.5 million in home sales revenues during the three months ended April 30, 2019. Land sales revenues: Our revenues from land sales generally consist of the following: (1) lot sales to third-party builders within our master planned communities; (2) land sales to joint ventures in which we retain an interest; and (3) bulk land sales to third parties of land we have decided no longer meets our development criteria. In general, our performance obligation for each of these land sales is fulfilled upon the delivery of the land, which generally coincides with the receipt of cash consideration from the counterparty. Effective November 1, 2018, in land sale transactions that contain repurchase options, revenues and related costs are not recognized until the repurchase option expires. In addition, when we sell land to a joint venture in which we retain an interest, we do not recognize revenue or gains on the sale to the extent of our retained interest in such joint venture. Forfeited Customer Deposits: Effective November 1, 2018, forfeited customer deposits are recognized in “Home sales revenues” in our Condensed Consolidated Statements of Operations and Comprehensive Income in the period in which we determine that the customer will not complete the purchase of the home and we have the right to retain the deposit. Sales Incentives: In order to promote sales of our homes, we may grant our home buyers sales incentives. These incentives will vary by type of incentive and by amount on a community-by-community and home-by-home basis. Incentives are reflected as a reduction in home sales revenues. Incentives are recognized at the time the home is delivered to the home buyer and we receive the sales proceeds. Recent Accounting Pronouncements In May 2014, the FASB created ASC 606 with the issuance ASU No. 2014-09, “Revenue from Contracts with Customers,” which provides guidance for revenue recognition. ASC 606 affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets. ASC 606 supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) Topic 605, “Revenue Recognition,” and most industry-specific guidance. ASC 606 also supersedes some cost guidance included in ASC Subtopic 605-35, “Revenue Recognition—Construction-Type and Production-Type Contracts.” The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which a company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under the previous guidance. These judgments and estimates include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, and allocating the transaction price to each separate performance obligation. In August 2015, the FASB issued ASU 2015-14 “Revenue from Contracts with Customers” (“ASU 2015-14”), which delayed the effective date of ASC 606 by one year. ASC 606, as amended by ASU 2015-14, became effective for our fiscal year beginning November 1, 2018, and we adopted the new standard under the modified retrospective transition method applied to contracts that were not completed as of November 1, 2018. We recognized the cumulative effect, net of tax, of applying ASC 606 as an adjustment to the opening balance of retained earnings. The comparative information has not been restated and continues to be reported under the previous accounting standards. The adoption of ASC 606 did not have a material impact on our Condensed Consolidated Balance Sheet or Condensed Consolidated Statement of Operations or Comprehensive Income, and there have been no significant changes to our internal controls, processes, or systems as a result of implementing this new standard. However, the adoption of ASC 606 resulted in the following changes:
In February 2017, the FASB issued ASU No. 2017-05, “Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets” (“ASU 2017-05”). ASU 2017-05 is meant to clarify the scope of the original guidance within Subtopic 610-20 that was issued in connection with ASC 606, which provides guidance for recognizing gains and losses from the transfer of nonfinancial assets in contracts with noncustomers. ASU 2017-05 also added guidance for partial sales of nonfinancial assets. ASU 2017-05 became effective for our fiscal year beginning November 1, 2018 and we adopted ASU 2017-05 concurrent with our adoption of ASC 606. The adoption of ASU 2017-05 did not have a material effect on our condensed consolidated financial statements and disclosures. In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash” (“ASU 2016-18”), which provides guidance on the classification of restricted cash in the statement of cash flows. ASU 2016-18 became effective for our fiscal year beginning November 1, 2018 and resulted in a change in the presentation to our Condensed Consolidated Statement of Cash Flows but did not have a material effect on our other condensed consolidated financial statements or disclosures. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” (“ASU 2016-15”), which is intended to reduce diversity in practice in how certain transactions are classified and makes eight targeted changes to how cash receipts and cash payments are presented in the statement of cash flows. ASU 2016-15 became effective for our fiscal year beginning November 1, 2018 and did not have a material effect on our condensed consolidated financial statements and disclosures. In February 2016, the FASB issued ASU No. 2016-02, “Leases” (“ASU 2016-02”), which requires an entity to recognize assets and liabilities on the balance sheet for the rights and obligations created by leased assets and provide additional disclosures. In July 2018, the FASB issued ASU No. 2018-11, “Leases: Targeted Improvements” (“ASU 2018-11”), which provides an entity with the option to apply the transition provisions of the new standard at its adoption date instead of at its earliest comparative period presented. ASU 2018-11 also provides an entity with a practical expedient that permits lessors to not separate nonlease components from the associated lease component if certain conditions are met. ASU 2016-02, as amended by ASU 2018-11, is effective for our fiscal year beginning November 1, 2019, at which time we will adopt the new standard using a modified retrospective approach. We are currently evaluating the impact that the adoption of ASU 2016-02, as amended by ASU 2018-11, may have on our consolidated financial statements and disclosures. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to estimate credit losses. ASU 2016-13 is effective for our fiscal year beginning November 1, 2020, with early adoption permitted as of November 1, 2019. We are currently evaluating the impact that the adoption of ASU 2016-13 may have on our consolidated financial statements and disclosures.
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Acquisition - Subsequent Event (Notes) |
6 Months Ended |
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Apr. 30, 2019 | |
Business Combinations [Abstract] | |
Acquisition | Acquisition – Subsequent Event In May 2019, we acquired substantially all of the assets and operations of Sharp Residential, LLC (“Sharp”), a builder in metropolitan Atlanta, Georgia, for approximately $93.2 million in cash. The assets acquired were primarily inventory, including approximately 950 home sites owned or controlled through land purchase agreements. In connection with this acquisition, we assumed contracts to deliver 125 homes with an aggregate value of $66.1 million. The average price of undelivered homes at the date of acquisition was approximately $528,900. As a result of this acquisition, our selling community count increased by 10 communities at the acquisition date.
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Inventory |
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Inventory | Inventory Inventory at April 30, 2019 and October 31, 2018 consisted of the following (amounts in thousands):
Operating communities include communities offering homes for sale; communities that have sold all available home sites but have not completed delivery of the homes; communities that were previously offering homes for sale but are temporarily closed due to business conditions or non-availability of improved home sites and that are expected to reopen within 12 months of the end of the fiscal period being reported on; and communities preparing to open for sale. The carrying value attributable to operating communities includes the cost of homes under construction, land and land development costs, the carrying cost of home sites in current and future phases of these communities, and the carrying cost of model homes. Communities that were previously offering homes for sale but are temporarily closed due to business conditions, do not have any remaining backlog, and are not expected to reopen within 12 months of the end of the fiscal period being reported on have been classified as land owned for future communities. Information regarding the classification, number, and carrying value of these temporarily closed communities, as of the dates indicated, is provided in the table below:
The amounts we have provided for inventory impairment charges and the expensing of costs that we believed not to be recoverable, for the periods indicated, are shown in the table below (amounts in thousands):
See Note 12, “Fair Value Disclosures,” for information regarding the number of operating communities that we tested for potential impairment, the number of operating communities in which we recognized impairment charges, the amount of impairment charges recognized, and the fair values of those communities, net of impairment charges. At April 30, 2019, we evaluated our land purchase contracts, including those to acquire land for apartment developments, to determine whether any of the selling entities were VIEs and, if they were, whether we were the primary beneficiary of any of them. Under these land purchase contracts, we do not possess legal title to the land; our risk is generally limited to deposits paid to the sellers and predevelopment costs incurred; and the creditors of the sellers generally have no recourse against us. At April 30, 2019, we determined that 130 land purchase contracts, with an aggregate purchase price of $2.00 billion, on which we had made aggregate deposits totaling $130.1 million, were VIEs, and that we were not the primary beneficiary of any VIE related to our land purchase contracts. At October 31, 2018, we determined that 110 land purchase contracts, with an aggregate purchase price of $1.88 billion, on which we had made aggregate deposits totaling $120.5 million, were VIEs and that we were not the primary beneficiary of any VIE related to our land purchase contracts. Interest incurred, capitalized, and expensed, for the periods indicated, was as follows (amounts in thousands):
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Investments in Unconsolidated Entities |
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Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in Unconsolidated Entities | Investments in Unconsolidated Entities We have investments in various unconsolidated entities. These entities, which are structured as joint ventures, (i) develop land for the joint venture participants and for sale to outside builders (“Land Development Joint Ventures”); (ii) develop for-sale homes (“Home Building Joint Ventures”); (iii) develop luxury for-rent residential apartments, commercial space, and a hotel (“Rental Property Joint Ventures”), which includes our investment in Toll Brothers Realty Trust (the “Trust”); and (iv) invest in distressed loans and real estate and provide financing and land banking to residential builders and developers for the acquisition and development of land and home sites (“Gibraltar Joint Ventures”). The table below provides information as of April 30, 2019, regarding active joint ventures that we are invested in, by joint venture category ($ amounts in thousands):
Certain joint ventures in which we have investments obtained debt financing to finance a portion of their activities. The table below provides information at April 30, 2019, regarding the debt financing obtained by category ($ amounts in thousands):
More specific and/or recent information regarding our investments in, advances to, and future commitments to these entities is provided below. Land Development Joint Ventures During the six months ended April 30, 2019, our Land Development Joint Ventures sold approximately 498 lots and recognized revenues of $138.8 million. We acquired 195 of these lots for $96.5 million. Our share of the joint venture income from the lots we acquired was insignificant. During the six months ended April 30, 2018, our Land Development Joint Ventures sold approximately 449 lots and recognized revenues of $102.8 million. We acquired 55 of these lots for $7.3 million. Our share of the income of $0.9 million from the lots we acquired was deferred by reducing our basis in those lots. During the three months ended April 30, 2019, our Land Development Joint Ventures sold approximately 297 lots and recognized revenues of $49.0 million. We acquired 88 of these lots for $25.3 million. Our share of the joint venture income from the lots we acquired was insignificant. During the three months ended April 30, 2018, our Land Development Joint Ventures sold approximately 200 lots and recognized revenues of $62.6 million. We acquired 25 of these lots for $4.2 million. Our share of the income of $0.4 million from the lots we acquired was deferred by reducing our basis in those lots. Home Building Joint Ventures Our Home Building Joint Ventures are delivering homes in New York, New York, and Jupiter, Florida. During the six months ended April 30, 2019 and 2018, our Home Building Joint Ventures delivered 72 homes with a sales value of $121.8 million and 54 homes with a sales value of $67.9 million, respectively. During the three months ended April 30, 2019 and 2018, our Home Building Joint Ventures delivered 55 homes with a sales value of $94.6 million and 26 homes with a sales value of $35.4 million, respectively. Rental Property Joint Ventures As of April 30, 2019, our Rental Property Joint Ventures, including those that we consolidate, owned 21 for-rent apartment projects and a hotel, which are located in the metropolitan Boston, Massachusetts to metropolitan Washington, D.C. corridor; Tempe, Arizona; San Diego, California; Miami, Florida; Atlanta, Georgia; and Frisco, Texas. At April 30, 2019, these joint ventures had approximately 2,100 units that were occupied or ready for occupancy, 1,500 units in the lease-up stage, and 1,700 units under development. In addition, we either own, have under contract, or under a letter of intent approximately 13,200 units, including 1,700 units under active development; we intend to develop these units in joint ventures with unrelated parties in the future. In the second quarter of fiscal 2019, we entered into a joint venture with unrelated parties to develop, build, and operate single-family rental communities. As of April 30, 2019, we have invested $0.9 million in this joint venture and have committed to invest up to $60.0 million. In the first quarter of fiscal 2019, we entered into two separate joint ventures with unrelated parties to develop luxury for-rent residential apartment projects located in Harrison, New York and Frisco, Texas. Prior to the formation of these joint ventures, we acquired the properties and incurred approximately $41.9 million of land and land development costs. Our partners each acquired a 75% interest in these entities for an aggregate amount of $39.8 million and we recognized a gain on land sale of $8.4 million in our first quarter of fiscal 2019. At April 30, 2019, we had an aggregate investment of $13.6 million in these joint ventures. Concurrent with their formation, these joint ventures entered into construction loan agreements for an aggregate amount of $134.4 million to finance the development of these projects. At April 30, 2019, the joint ventures had $5.6 million outstanding borrowings under these construction loan facilities. In addition, during the six months ended April 30, 2019, we entered into four separate joint ventures with unrelated parties to develop luxury for-rent residential apartment projects and student housing communities located in Boston, Massachusetts, San Diego, California, Tempe, Arizona and Miami, Florida. We contributed an aggregate of $79.4 million for our initial ownership interests in these joint ventures, which ranged from 50% to 98%. Due to our controlling financial interest, our power to direct the activities that most significantly impact each joint venture’s performance, and/or our obligation to absorb expected losses or receive benefits from these joint ventures, we consolidated these joint ventures at April 30, 2019. The carrying value of these joint ventures’ assets totaling $118.6 million are reflected in “Receivables, prepaid expenses, and other assets” in our Condensed Consolidated Balance Sheet as of April 30, 2019. Our partners’ interests aggregating $36.2 million in the joint ventures are reflected as a component of “Noncontrolling interest” in our Condensed Consolidated Balance Sheet as of April 30, 2019. These joint ventures intend to obtain additional equity investors and secure third-party financing at a later date. At such time, it is expected that these entities would no longer be consolidated. In the third quarter of fiscal 2018, we entered into a joint venture with an unrelated party to develop a 289-unit luxury for-rent residential apartment project in a suburb of Boston, Massachusetts. We contributed cash of $15.9 million for our initial 85% ownership interest in this joint venture. Due to our controlling financial interest, our power to direct the activities that most significantly impact the joint venture’s performance, and/or our obligation to absorb expected losses or receive benefits from the joint venture, we have consolidated this joint venture at April 30, 2019. The carrying value of the joint venture’s assets totaling $19.9 million are reflected in “Receivables, prepaid expenses, and other assets” in our Condensed Consolidated Balance Sheet as of April 30, 2019. Our partner’s 15% interest of $3.0 million in the joint venture is reflected as a component of “Noncontrolling interest” in our Condensed Consolidated Balance Sheet as of April 30, 2019. The joint venture intends to obtain additional equity investors and secure third-party financing at a later date. At such time, it is expected that the entity would no longer be consolidated. In the first quarter of fiscal 2018, one of our Rental Property Joint Ventures sold its assets to an unrelated party for $219.0 million. The joint venture had owned, developed, and operated a student housing community in College Park, Maryland. In connection with the sale, the joint venture’s existing $110.0 million loan was repaid. We received cash of $39.3 million and recognized a gain of $30.8 million in the three months ended January 31, 2018, which is included in “Income from unconsolidated entities” in our Condensed Consolidated Statements of Operations and Comprehensive Income. In 1998, we formed the Trust to invest in commercial real estate opportunities. The Trust is effectively owned one-third by us; one-third by current and former members of our senior management; and one-third by an unrelated party. As of April 30, 2019, our investment in the Trust was zero as cumulative distributions received from the Trust have been in excess of the carrying amount of our net investment. We provide development, finance, and management services to the Trust and recognized fees under the terms of various agreements in the amount of $0.5 million and $1.2 million in the six-month periods ended April 30, 2019 and 2018, respectively. Gibraltar Joint Ventures We, through our wholly owned subsidiary, Gibraltar Capital and Asset Management, LLC (“Gibraltar”), have entered into six ventures with an institutional investor to provide builders and developers with land banking and venture capital. These ventures will finance builders’ and developers’ acquisition and development of land and home sites and pursue other complementary investment strategies. We also are a member in a separate venture with the same institutional investor, which purchased, from Gibraltar, certain foreclosed real estate owned and distressed loans in fiscal 2016. Our ownership interest in these ventures is approximately 25%. We may invest up to $100.0 million in these ventures. As of April 30, 2019, we had an aggregate investment of $17.5 million in these ventures. Guarantees The unconsolidated entities in which we have investments generally finance their activities with a combination of partner equity and debt financing. In some instances, we and our partners have guaranteed debt of certain unconsolidated entities. These guarantees may include any or all of the following: (i) project completion guarantees, including any cost overruns; (ii) repayment guarantees, generally covering a percentage of the outstanding loan; (iii) carry cost guarantees, which cover costs such as interest, real estate taxes, and insurance; (iv) an environmental indemnity provided to the lender that holds the lender harmless from and against losses arising from the discharge of hazardous materials from the property and non-compliance with applicable environmental laws; and (v) indemnification of the lender from “bad boy acts” of the unconsolidated entity. In some instances, the guarantees provided in connection with loans to an unconsolidated entity are joint and several. In these situations, we generally have a reimbursement agreement with our partner that provides that neither party is responsible for more than its proportionate share or agreed upon share of the guarantee; however, if a joint venture partner does not have adequate financial resources to meet its obligations under the reimbursement agreement, we may be liable for more than our proportionate share. We believe that, as of April 30, 2019, in the event we become legally obligated to perform under a guarantee of an obligation of an unconsolidated entity due to a triggering event, the collateral in such entity should be sufficient to repay a significant portion of the obligation. If it is not, we and our partners would need to contribute additional capital to the venture. At April 30, 2019, certain unconsolidated entities have loan commitments aggregating $1.23 billion, of which, if the full amount of the debt obligations were borrowed, we estimate $310.6 million to be our maximum exposure related to repayment and carry cost guarantees. At April 30, 2019, the unconsolidated entities had borrowed an aggregate of $903.5 million, of which we estimate $271.1 million to be our maximum exposure related to repayment and carry cost guarantees. The terms of these guarantees generally range from 2 months to 42 months. These maximum exposure estimates do not take into account any recoveries from the underlying collateral or any reimbursement from our partners. As of April 30, 2019, the estimated aggregate fair value of the guarantees provided by us related to debt and other obligations of certain unconsolidated entities was approximately $5.4 million. We have not made payments under any of the guarantees, nor have we been called upon to do so. Variable Interest Entities At April 30, 2019 and October 31, 2018, we determined that 17 and 11, respectively, of our joint ventures were VIEs under the guidance of ASC 810, “Consolidation.” For 12 and 10 of these VIEs as of April 30, 2019 and October 31, 2018, respectively, we concluded that we were not the primary beneficiary of these VIEs because the power to direct the activities of such VIEs that most significantly impact their performance was either shared by us and such VIEs’ other partners or such activities were controlled by our partner. For VIEs where the power to direct significant activities is shared, business plans, budgets, and other major decisions are required to be unanimously approved by all members. Management and other fees earned by us are nominal and believed to be at market rates, and there is no significant economic disproportionality between us and the other members. The information presented below regarding the investments, commitments, and guarantees in unconsolidated entities deemed to be VIEs is also included in the information provided above. As of April 30, 2019, we have consolidated five Rental Property Joint Ventures. The carrying value of these joint ventures’ assets totaling $138.5 million is reflected in “Receivables, prepaid expenses, and other assets” in our Condensed Consolidated Balance Sheet as of April 30, 2019. Our partners’ interests aggregating $39.2 million in the joint ventures are reflected as a component of “Noncontrolling interest” in our Condensed Consolidated Balance Sheet as of April 30, 2019. These joint ventures were determined to be VIEs due to their current inability to finance their activities without additional subordinated financial support as well as our partners’ inability to participate in the significant decisions of the joint venture and their lack of substantive kick-out rights. We further concluded that we are the primary beneficiary of these VIEs due to our controlling financial interest in such ventures as we have the power to direct the activities that most significantly impact the joint ventures’ performance and the obligation to absorb expected losses or receive benefits from the joint ventures. The assets of these VIEs can only be used to settle the obligations of the VIEs. In addition, in certain of the joint ventures, in the event additional contributions are required to be funded to the joint ventures prior to the admission of any additional investor at a future date, we will fund 100% of such contributions, including our partner’s pro rata share, which we expect would be funded through an interest-bearing loan. At April 30, 2019 and October 31, 2018, our investments in the unconsolidated entities deemed to be VIEs totaled $36.3 million and $33.8 million, respectively. At April 30, 2019 and October 31, 2018, the maximum exposure of loss to our investments in these entities was limited to our investments in the unconsolidated VIEs, except with regard to $70.0 million of loan guarantees and $10.4 million and $10.8 million, respectively, of additional commitments to the VIEs. Of our potential exposure for these loan guarantees, $70.0 million is related to loan repayment and carry cost guarantees, of which $70.0 million was borrowed at April 30, 2019 and October 31, 2018. Joint Venture Condensed Financial Information The Condensed Balance Sheets, as of the dates indicated, and the Condensed Statements of Operations, for the periods indicated, for the unconsolidated entities in which we have an investment are included below (in thousands): Condensed Balance Sheets:
Condensed Statements of Operations:
(1) Differences between our equity in earnings of unconsolidated entities and the underlying net income of the entities are primarily a result of a basis difference of an acquired joint venture interest; distributions from entities in excess of the carrying amount of our net investment; recoveries of previously incurred charges; unrealized gains on our retained joint venture interests; and our share of the entities’ profits related to home sites purchased by us which reduces our cost basis of the home sites acquired.
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Receivables, Prepaid Expenses, and Other Assets |
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Receivables, prepaid expenses and other assets [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables, prepaid expenses and other assets [Text Block] | Receivables, Prepaid Expenses, and Other Assets Receivables, prepaid expenses, and other assets at April 30, 2019 and October 31, 2018, consisted of the following (amounts in thousands):
See Note 7, “Accrued Expenses,” for additional information regarding the expected recoveries from insurance carriers and others.
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Loans Payable, Senior Notes and Mortgage Company Loan Facility |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans Payable, Senior Notes, and Mortgage Company Loan Facility | Loans Payable, Senior Notes, and Mortgage Company Loan Facility Loans Payable At April 30, 2019 and October 31, 2018, loans payable consisted of the following (amounts in thousands):
Senior Unsecured Term Loan At April 30, 2019, we had an $800.0 million, five-year senior unsecured term loan facility (the “Term Loan Facility”) with a syndicate of banks. On November 1, 2018, we entered into an amendment to the Term Loan Facility to, among other things, (i) increase the size of the outstanding term loan to $800.0 million; (ii) extend the maturity date to November 1, 2023, with no principal payments being required before the maturity date; (iii) provide an accordion feature under which we may, subject to certain conditions set forth in the agreement, increase the Term Loan Facility up to a maximum aggregate amount of $1.0 billion; (iv) revise certain provisions to reduce the interest rate applicable on outstanding borrowings; and (v) modify certain provisions relating to existing financial maintenance and negative covenants. At April 30, 2019, the interest rate on borrowings was 3.78% per annum. We and substantially all of our 100%-owned home building subsidiaries are guarantors under the Term Loan Facility. Under the terms of the Term Loan Facility, at April 30, 2019, our maximum leverage ratio, as defined, may not exceed 1.75 to 1.00, and we are required to maintain a minimum tangible net worth, as defined, of no less than approximately $2.76 billion. Under the terms of the Term Loan Facility, at April 30, 2019, our leverage ratio was approximately 0.56 to 1.00, and our tangible net worth was approximately $4.90 billion. Based upon the limitations related to our repurchase of common stock in the Term Loan Facility, our ability to repurchase our common stock was limited to approximately $3.35 billion as of April 30, 2019. In addition, our ability to pay cash dividends was limited to approximately $2.14 billion as of April 30, 2019. Credit Facility We have a $1.295 billion, five-year senior unsecured revolving credit facility (the “Credit Facility”) with a syndicate of banks. The Credit Facility is scheduled to expire in May 2021. We and substantially all of our 100%-owned home building subsidiaries are guarantors under the Credit Facility. Under the terms of the Credit Facility, at April 30, 2019, our maximum leverage ratio, as defined, may not exceed 1.75 to 1.00, and we are required to maintain a minimum tangible net worth, as defined, of no less than approximately $2.59 billion. Under the terms of the Credit Facility, at April 30, 2019, our leverage ratio was approximately 0.56 to 1.00, and our tangible net worth was approximately $4.90 billion. Based upon the limitations related to our repurchase of common stock in the Credit Facility, our ability to repurchase our common stock was limited to approximately $3.00 billion as of April 30, 2019. In addition, under the provisions of the Credit Facility, our ability to pay cash dividends was limited to approximately $2.31 billion as of April 30, 2019. At April 30, 2019, we had no outstanding borrowings under the Credit Facility and had approximately $179.3 million of outstanding letters of credit that were issued under the Credit Facility. At April 30, 2019, the interest rate on borrowings under the Credit Facility would have been 3.98% per annum. Loans Payable – Other “Loans payable – other” primarily represent purchase money mortgages on properties we acquired that the seller had financed and various revenue bonds that were issued by government entities on our behalf to finance community infrastructure and our manufacturing facilities. At April 30, 2019, the weighted-average interest rate on “Loans payable – other” was 4.81% per annum. Senior Notes At April 30, 2019, we had seven issues of senior notes outstanding with an aggregate principal amount of $2.52 billion. In January 2018, we issued $400.0 million principal amount of 4.350% Senior Notes due 2028. We received $396.4 million of net proceeds from the issuance of these senior notes. On November 30, 2018, we redeemed, prior to maturity, the $350.0 million of then-outstanding principal amount of 4.00% Senior Notes due December 31, 2018, at par, plus accrued interest. Mortgage Company Loan Facility In October 2017, TBI Mortgage® Company (“TBI Mortgage”), our wholly owned mortgage subsidiary, entered into a mortgage warehousing agreement (the “Warehousing Agreement”) with a bank to finance the origination of mortgage loans by TBI Mortgage. The Warehousing Agreement is accounted for as a secured borrowing under ASC 860, “Transfers and Servicing.” In December 2018, the Warehousing Agreement was amended again to provide for loan purchases up to $75.0 million, subject to certain sublimits. In addition, the Warehousing Agreement, as amended, provides for an accordion feature under which TBI Mortgage may request that the aggregate commitments under the Warehousing Agreement be increased to an amount up to $150.0 million for a short period of time. The Warehousing Agreement, as amended, expires on December 6, 2019, and borrowings thereunder bear interest at LIBOR plus 1.90% per annum. At April 30, 2019, the interest rate on the Warehousing Agreement, as amended, was 4.38% per annum. Prior to the December 2018 amendment, the Warehousing Agreement was operating pursuant to the December 2017 amendment which had substantially similar terms to the December 2018 amendment.
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Accrued Expenses |
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Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued Expenses | Accrued Expenses Accrued expenses at April 30, 2019 and October 31, 2018 consisted of the following (amounts in thousands):
The table below provides, for the periods indicated, a reconciliation of the changes in our warranty accrual (amounts in thousands):
Since fiscal 2014, we have received water intrusion claims from owners of homes built since 2002 in communities located in Pennsylvania and Delaware (which are in our Mid-Atlantic region). During the first two quarters of fiscal 2019, we continued to receive water intrusion claims from homeowners in this region, mostly related to older homes, and we continue to perform review procedures to assess, among other things, the number of affected homes, whether repairs are likely to be required, and the extent of such repairs. Our review process, conducted quarterly, includes an analysis of many factors applicable to these communities to determine whether a claim is likely to be received and the estimated costs to resolve any such claim, including: the closing dates of the homes; the number of claims received; our inspection of homes; an estimate of the number of homes we expect to repair; the type and cost of repairs that have been performed in each community; the estimated costs to remediate pending and future claims; the expected recovery from our insurance carriers and suppliers; and the previously recorded amounts related to these claims. We also monitor legal developments relating to these types of claims and review the volume, relative merits and adjudication of claims in litigation or arbitration. As of April 30, 2019, our recorded aggregate estimated repair costs to be incurred for known and unknown water intrusion claims was $324.4 million, which was unchanged from October 31, 2016, and our recorded aggregate expected recoveries from insurance carriers and suppliers were approximately $152.6 million, which was also unchanged from October 31, 2016. Our recorded remaining estimated repair costs, which reflects a reduction for the aggregate amount expended to resolve claims, were approximately $148.1 million at April 30, 2019 and $177.6 million at October 31, 2018. Our recorded remaining expected recoveries from insurance carriers and suppliers were approximately $104.1 million at April 30, 2019 and $109.3 million at October 31, 2018. As noted above, our review process includes a number of estimates that are based on assumptions with uncertain outcomes, including, but not limited to, the number of homes to be repaired, the extent of repairs needed, the repair procedures employed, the cost of those repairs, outcomes of litigation or arbitrations, and expected recoveries from insurance carriers and suppliers. Due to the degree of judgment required in making these estimates and the inherent uncertainty in potential outcomes, it is reasonably possible that our actual costs and recoveries could differ from those recorded and such differences could be material. In addition, due to such uncertainty, we are unable to estimate the range of any such differences. We believe collection of our recorded insurance receivables is probable based on the legal merits that support our pending insurance claims and the high credit ratings of our insurance carriers; however, due to the complexity of the underlying claims and the variability of the other factors described above, it is reasonably possible that our actual insurance recoveries could materially differ from those recorded. Resolution of these known and unknown claims is expected to take several years.
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Income Taxes |
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Apr. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We recorded income tax provisions of $86.2 million and $40.4 million for the six months ended April 30, 2019 and 2018, respectively. The effective tax rate was 26.3% for the six months ended April 30, 2019, compared to 14.2% for the six months ended April 30, 2018. For the three months ended April 30, 2019 and 2018, we recorded income tax provisions of $46.8 million and $40.9 million, respectively. The effective tax rate was 26.6% for the three months ended April 30, 2019, compared to 26.8% for the three months ended April 30, 2018. The lower effective tax rate for the six months ended April 30, 2018 was primarily due to a $31.2 million income tax benefit from the remeasurement of the Company’s net deferred tax liability as a result of the Tax Cuts and Jobs Act (the “Tax Act”), which was enacted into law on December 22, 2017. The income tax provisions for both periods included a provision for state income taxes; interest accrued on anticipated tax assessments; excess tax benefits related to stock-based compensation; and other permanent differences. The income tax provisions for the fiscal 2018 periods also benefited from the domestic activities deduction. The Tax Act repealed the domestic production activities deduction effective for the fiscal 2019 period. The Tax Act, among other changes, reduced the corporate income tax rate from 35% to 21% effective for tax years beginning after December 31, 2017. For companies with a fiscal year that does not end on December 31, the change in law required the application of a blended tax rate for the year of the change. Our blended tax rate for the fiscal 2018 periods was 23.3%. For the fiscal 2019 periods and thereafter, the applicable statutory rate is 21%. We are subject to state tax in the jurisdictions in which we operate. We estimate our state tax liability based upon the individual taxing authorities’ regulations, estimates of income by taxing jurisdiction, and our ability to utilize certain tax-saving strategies. Based on our estimate of the allocation of income or loss among the various taxing jurisdictions and changes in tax regulations and their impact on our tax strategies, we estimate that our state income tax rate for the full fiscal year 2019 will be approximately 6.8%. Our state income tax rate for the full fiscal year 2018 was 6.6%. At April 30, 2019, we had $9.9 million of gross unrecognized tax benefits, including interest and penalties. If these unrecognized tax benefits were to reverse in the future, they would have a beneficial impact on our effective tax rate at that time. During the next 12 months, it is reasonably possible that our unrecognized tax benefits will change, but we are not able to provide a range of such change. The possible changes would be principally due to the expiration of tax statutes, settlements with taxing jurisdictions, increases due to new tax positions taken, and the accrual of estimated interest and penalties.
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Stock-Based Benefit Plans |
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Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-Based Benefit Plans | Stock-Based Benefit Plans We grant stock options and various types of restricted stock units to our employees and our nonemployee directors. Additionally, we have an employee stock purchase plan that allows employees to purchase our stock at a discount. Information regarding the amount of total stock-based compensation expense and tax benefit recognized by us, for the periods indicated, is as follows (amounts in thousands):
At April 30, 2019 and October 31, 2018, the aggregate unamortized value of outstanding stock-based compensation awards was approximately $30.1 million and $20.9 million, respectively.
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Stock Repurchase Program and Cash Dividend |
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Stock Repurchase Program [Text Block] | Stock Repurchase Program and Cash Dividends Stock Repurchase Program On December 12, 2018, our Board of Directors terminated our existing 20 million share repurchase program, which was authorized in December 2017, and authorized, under a new repurchase program, the repurchase of 20 million shares of our common stock in open market transactions or otherwise for general corporate purposes, including to obtain shares for the Company’s equity award and other employee benefit plans. Our Board of Directors did not fix any expiration date for this repurchase program. The table below provides, for the periods indicated, information about our share repurchase programs:
Subsequent to April 30, 2019 and through June 5, 2019, we repurchased approximately 2.5 million shares of our common stock at an average price of $35.70 per share. Cash Dividends On February 21, 2017, our Board of Directors approved the initiation of quarterly cash dividends to shareholders. During the six months ended April 30, 2019 and 2018, we declared and paid aggregate cash dividends of $0.22 and $0.19 per share, respectively, to our shareholders. During the three months ended April 30, 2019 and 2018, we declared and paid cash dividends $0.11 and $0.08 per share, respectively, to our shareholders.
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Earnings Per Share Information |
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Income per Share Information | Earnings per Share Information The table below provides, for the periods indicated, information pertaining to the calculation of earnings per share, common stock equivalents, weighted-average number of antidilutive options, and shares issued (amounts in thousands):
(2) Weighted-average number of antidilutive options and restricted stock units are based upon the average closing price of our common stock on the New York Stock Exchange for the period.
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Fair Value Disclosures |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Text Block] | Fair Value Disclosures Financial Instruments The table below provides, as of the dates indicated, a summary of assets/(liabilities) related to our financial instruments, measured at fair value on a recurring basis (amounts in thousands):
At April 30, 2019 and October 31, 2018, the carrying value of cash and cash equivalents and customer deposits held in escrow approximated fair value. Mortgage Loans Held for Sale At the end of the reporting period, we determine the fair value of our mortgage loans held for sale and the forward loan commitments we have entered into as a hedge against the interest rate risk of our mortgage loans and commitments using the market approach to determine fair value. The table below provides, as of the dates indicated, the aggregate unpaid principal and fair value of mortgage loans held for sale (amounts in thousands):
Inventory We recognize inventory impairment charges based on the difference in the carrying value of the inventory and its fair value at the time of the evaluation. The fair value of inventory was determined using Level 3 criteria. See Note 1, “Significant Accounting Policies – Inventory,” in our 2018 Form 10-K for information regarding our methodology for determining fair value. The table below summarizes, for the periods indicated, the ranges of certain quantitative unobservable inputs utilized in determining the fair value of impaired operating communities:
The table below provides, for the periods indicated, the number of operating communities that we reviewed for potential impairment, the number of operating communities in which we recognized impairment charges, the amount of impairment charges recognized, and, as of the end of the period indicated, the fair value of those communities, net of impairment charges ($ amounts in thousands):
Debt The table below provides, as of the dates indicated, the book value and estimated fair value of our debt (amounts in thousands):
(3) We believe that the carrying value of our mortgage company loan borrowings approximates their fair value.
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Other Income - Net |
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Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income - net | Other Income – Net The table below provides the significant components of other income – net (amounts in thousands):
As a result of our adoption of ASC 606 as of November 1, 2018, revenues and cost of revenues from land sales are presented as separate components on our Condensed Consolidated Statement of Operations and Comprehensive Income. In addition, retained customer deposits are presented in home sales revenues on our Condensed Consolidated Statement of Operations and Comprehensive Income. Because we elected to apply the modified retrospective method of adoption, prior periods have not been restated to reflect these changes in presentation. See Note 1, “Significant Accounting Policies – Recent Accounting Pronouncements” for additional information regarding the impact of the adoption of ASC 606. Management fee income from home building unconsolidated entities presented above primarily represents fees earned by Toll Brothers City Living® (“City Living”) and traditional home building operations. In addition, in the six-month periods ended April 30, 2019 and 2018, our apartment living operations earned fees from unconsolidated entities of $4.7 million and $4.0 million, respectively. In the three-month periods ended April 30, 2019 and 2018, our apartment living operations earned fees from unconsolidated entities of $2.1 million and $1.7 million, respectively. Fees earned by our apartment living operations are included in income from ancillary businesses. Income from ancillary businesses is generated by our mortgage, title, landscaping, security monitoring, Gibraltar, and golf course and country club operations. The table below provides, for the periods indicated, revenues and expenses for our ancillary businesses (amounts in thousands):
In December 2018, we sold one of our golf club properties to a third party for $18.2 million and we recognized a gain of $12.2 million in the first quarter of fiscal 2019. The table below provides revenues and expenses recognized from land sales for the periods indicated (amounts in thousands):
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Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Text Block] | Commitments and Contingencies Legal Proceedings We are involved in various claims and litigation arising principally in the ordinary course of business. We believe that adequate provision for resolution of all current claims and pending litigation has been made and that the disposition of these matters will not have a material adverse effect on our results of operations and liquidity or on our financial condition. In March 2018, the Pennsylvania Attorney General informed the Company that it was conducting a review of our construction of stucco homes in Pennsylvania after January 1, 2005 and requested that we voluntarily produce documents and information. The Company has produced documents and information in response to this request and, in addition, has produced requested information and documents in response to a subpoena issued in the second quarter of fiscal 2019. Management cannot at this time predict the eventual scope or outcome of this matter. Land Purchase Commitments Generally, our agreements to acquire land parcels do not require us to purchase those land parcels, although we, in some cases, forfeit any deposit balance outstanding if and when we terminate an agreement. Information regarding our land purchase commitments, as of the dates indicated, is provided in the table below (amounts in thousands):
In addition, we expect to purchase approximately 2,600 additional home sites over a number of years from several joint ventures in which we have interests; the purchase prices of these home sites will be determined at a future date. At April 30, 2019, we also had purchase commitments to acquire land for apartment developments of approximately $326.9 million, of which we had outstanding deposits in the amount of $14.3 million. We intend to develop these projects in joint ventures with unrelated parties in the future. We have additional land parcels under option that have been excluded from the aggregate purchase commitments since we do not believe that we will complete the purchase of these land parcels and no additional funds will be required from us to terminate these contracts. Investments in Unconsolidated Entities At April 30, 2019, we had investments in a number of unconsolidated entities, were committed to invest or advance additional funds, and had guaranteed a portion of the indebtedness and/or loan commitments of these entities. See Note 4, “Investments in Unconsolidated Entities,” for more information regarding our commitments to these entities. Surety Bonds and Letters of Credit At April 30, 2019, we had outstanding surety bonds amounting to $734.2 million, primarily related to our obligations to governmental entities to construct improvements in our communities. We estimate that approximately $334.5 million of work remains on these improvements. We have an additional $175.4 million of surety bonds outstanding that guarantee other obligations. We do not believe that it is probable that any outstanding bonds will be drawn upon. At April 30, 2019, we had outstanding letters of credit of $179.3 million under our Credit Facility. These letters of credit were issued to secure various financial obligations, including insurance policy deductibles and other claims, land deposits, and security to complete improvements in communities in which we are operating. We do not believe that it is probable that any outstanding letters of credit will be drawn upon. Backlog At April 30, 2019, we had agreements of sale outstanding to deliver 6,467 homes with an aggregate sales value of $5.66 billion. Mortgage Commitments Information regarding our mortgage commitments, as of the dates indicated, is provided in the table below (amounts in thousands):
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Information on Segments |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Disclosure [Text Block] | Information on Segments We operate in two segments: traditional home building and urban infill. We build and sell detached and attached homes in luxury residential communities located in affluent suburban markets that cater to move-up, empty-nester, active-adult, age-qualified, and second-home buyers in the United States (“Traditional Home Building”). We also build and sell homes in urban infill markets through City Living. We have determined that our Traditional Home Building operations operate in five geographic segments: North, Mid-Atlantic, South, West, and California. The states comprising each geographic segment are as follows: 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, Oregon, Utah, and Washington California: California In fiscal 2018, we acquired land and commenced development activities in the Salt Lake City, Utah and Portland, Oregon markets. In the second quarter of fiscal 2019, we opened several communities in these markets. Revenue and income (loss) before income taxes for each of our segments, for the periods indicated, were as follows (amounts in thousands):
“Corporate and other” is comprised principally of general corporate expenses such as our executive offices; the corporate finance, accounting, audit, tax, human resources, risk management, information technology, marketing, and legal groups; interest income; income from certain of our ancillary businesses, including Gibraltar; and income from our Rental Property Joint Ventures and Gibraltar Joint Ventures. Total assets for each of our segments, as of the dates indicated, are shown in the table below (amounts in thousands):
“Corporate and other” is comprised principally of cash and cash equivalents, restricted cash, deferred tax assets, investments in our Rental Property Joint Ventures, expected recoveries from insurance carriers and suppliers, our Gibraltar investments and operations, manufacturing facilities, and our mortgage and title subsidiaries.
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Supplemental Disclosure to Condensed Consolidated Statements of Cash Flows |
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Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Disclosure to Statements of Cash Flows | Supplemental Disclosure to Condensed Consolidated Statements of Cash Flows The following are supplemental disclosures to the Condensed Consolidated Statements of Cash Flows, for the periods indicated (amounts in thousands):
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Supplemental Guarantor Information |
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Supplemental Guarantor Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Guarantor Information [Text Block] | Supplemental Guarantor Information At April 30, 2019, our 100%-owned subsidiary, Toll Brothers Finance Corp. (the “Subsidiary Issuer”), has issued the following outstanding Senior Notes (amounts in thousands):
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. 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, 2019:
Condensed Consolidating Balance Sheet at October 31, 2018:
Condensed Consolidating Statement of Operations and Comprehensive Income for the six months ended April 30, 2019:
Condensed Consolidating Statement of Operations and Comprehensive Income for the six months ended April 30, 2018:
Condensed Consolidating Statement of Operations and Comprehensive Income for the three months ended April 30, 2019:
Condensed Consolidating Statement of Operations and Comprehensive Income for the three months ended April 30, 2018:
Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2019:
Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2018:
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Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | Basis of Presentation The accompanying condensed consolidated financial statements include the accounts of Toll Brothers, Inc. (the “Company,” “we,” “us,” or “our”), a Delaware corporation, and its majority owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Investments in 50% or less owned partnerships and affiliates are accounted for using the equity method unless it is determined that we have effective control of the entity, in which case we would consolidate the entity. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information. The October 31, 2018 balance sheet amounts and disclosures included herein have been derived from our October 31, 2018 audited financial statements. Since the accompanying condensed consolidated financial statements do not include all the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements, they should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended October 31, 2018 (“2018 Form 10-K”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, which are of a normal recurring nature, necessary to present fairly our financial position as of April 30, 2019; the results of our operations and changes in equity for the six-month and three-month periods ended April 30, 2019 and 2018; and our cash flows for the six-month periods ended April 30, 2019 and 2018. The results of operations for such interim periods are not necessarily indicative of the results to be expected for the full year.
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Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition As discussed under “Recent Accounting Pronouncements” below, on November 1, 2018, we adopted Accounting Standards Codification (“ASC”) Topic 606 “Revenue from Contracts with Customers” (“ASC 606”). As a result of this adoption, we updated our revenue recognition policies effective November 1, 2018, as follows: Home sales revenues: Revenues and cost of revenues from home sales are recognized at the time each home is delivered and title and possession are transferred to the buyer. For the majority of our home closings, our performance obligation to deliver a home is satisfied in less than one year from the date a binding sale agreement is signed. In certain states that we build, we are not able to complete certain outdoor features prior to the closing of the home. Effective November 1, 2018, to the extent these separate performance obligations are not complete upon the home closing, we defer a portion of the home sales revenues related to these obligations and subsequently recognize the revenue upon completion of such obligations. As of April 30, 2019, we deferred home sales revenues and related costs of $2.5 million and $1.9 million, respectively, related to obligations not completed on closed homes. Our contract liabilities, consisting of deposits received from customers for sold but undelivered homes, totaled $419.5 million, $406.4 million, and $410.9 million at April 30, 2019, January 31, 2019, and October 31, 2018, respectively. Of the outstanding customer deposits held as of October 31, 2018, we recognized $204.4 million in home sales revenues during the six months ended April 30, 2019. Of the outstanding customer deposits held as of January 31, 2019, we recognized $124.5 million in home sales revenues during the three months ended April 30, 2019. Land sales revenues: Our revenues from land sales generally consist of the following: (1) lot sales to third-party builders within our master planned communities; (2) land sales to joint ventures in which we retain an interest; and (3) bulk land sales to third parties of land we have decided no longer meets our development criteria. In general, our performance obligation for each of these land sales is fulfilled upon the delivery of the land, which generally coincides with the receipt of cash consideration from the counterparty. Effective November 1, 2018, in land sale transactions that contain repurchase options, revenues and related costs are not recognized until the repurchase option expires. In addition, when we sell land to a joint venture in which we retain an interest, we do not recognize revenue or gains on the sale to the extent of our retained interest in such joint venture. Forfeited Customer Deposits: Effective November 1, 2018, forfeited customer deposits are recognized in “Home sales revenues” in our Condensed Consolidated Statements of Operations and Comprehensive Income in the period in which we determine that the customer will not complete the purchase of the home and we have the right to retain the deposit. Sales Incentives: In order to promote sales of our homes, we may grant our home buyers sales incentives. These incentives will vary by type of incentive and by amount on a community-by-community and home-by-home basis. Incentives are reflected as a reduction in home sales revenues. Incentives are recognized at the time the home is delivered to the home buyer and we receive the sales proceeds.
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New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements In May 2014, the FASB created ASC 606 with the issuance ASU No. 2014-09, “Revenue from Contracts with Customers,” which provides guidance for revenue recognition. ASC 606 affects any entity that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets. ASC 606 supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) Topic 605, “Revenue Recognition,” and most industry-specific guidance. ASC 606 also supersedes some cost guidance included in ASC Subtopic 605-35, “Revenue Recognition—Construction-Type and Production-Type Contracts.” The standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which a company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under the previous guidance. These judgments and estimates include identifying performance obligations in the contract, estimating the amount of variable consideration to include in the transaction price, and allocating the transaction price to each separate performance obligation. In August 2015, the FASB issued ASU 2015-14 “Revenue from Contracts with Customers” (“ASU 2015-14”), which delayed the effective date of ASC 606 by one year. ASC 606, as amended by ASU 2015-14, became effective for our fiscal year beginning November 1, 2018, and we adopted the new standard under the modified retrospective transition method applied to contracts that were not completed as of November 1, 2018. We recognized the cumulative effect, net of tax, of applying ASC 606 as an adjustment to the opening balance of retained earnings. The comparative information has not been restated and continues to be reported under the previous accounting standards. The adoption of ASC 606 did not have a material impact on our Condensed Consolidated Balance Sheet or Condensed Consolidated Statement of Operations or Comprehensive Income, and there have been no significant changes to our internal controls, processes, or systems as a result of implementing this new standard. However, the adoption of ASC 606 resulted in the following changes:
In February 2017, the FASB issued ASU No. 2017-05, “Other Income - Gains and Losses from the Derecognition of Nonfinancial Assets (Subtopic 610-20): Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets” (“ASU 2017-05”). ASU 2017-05 is meant to clarify the scope of the original guidance within Subtopic 610-20 that was issued in connection with ASC 606, which provides guidance for recognizing gains and losses from the transfer of nonfinancial assets in contracts with noncustomers. ASU 2017-05 also added guidance for partial sales of nonfinancial assets. ASU 2017-05 became effective for our fiscal year beginning November 1, 2018 and we adopted ASU 2017-05 concurrent with our adoption of ASC 606. The adoption of ASU 2017-05 did not have a material effect on our condensed consolidated financial statements and disclosures. In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash” (“ASU 2016-18”), which provides guidance on the classification of restricted cash in the statement of cash flows. ASU 2016-18 became effective for our fiscal year beginning November 1, 2018 and resulted in a change in the presentation to our Condensed Consolidated Statement of Cash Flows but did not have a material effect on our other condensed consolidated financial statements or disclosures. In August 2016, the FASB issued ASU No. 2016-15, “Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments” (“ASU 2016-15”), which is intended to reduce diversity in practice in how certain transactions are classified and makes eight targeted changes to how cash receipts and cash payments are presented in the statement of cash flows. ASU 2016-15 became effective for our fiscal year beginning November 1, 2018 and did not have a material effect on our condensed consolidated financial statements and disclosures. In February 2016, the FASB issued ASU No. 2016-02, “Leases” (“ASU 2016-02”), which requires an entity to recognize assets and liabilities on the balance sheet for the rights and obligations created by leased assets and provide additional disclosures. In July 2018, the FASB issued ASU No. 2018-11, “Leases: Targeted Improvements” (“ASU 2018-11”), which provides an entity with the option to apply the transition provisions of the new standard at its adoption date instead of at its earliest comparative period presented. ASU 2018-11 also provides an entity with a practical expedient that permits lessors to not separate nonlease components from the associated lease component if certain conditions are met. ASU 2016-02, as amended by ASU 2018-11, is effective for our fiscal year beginning November 1, 2019, at which time we will adopt the new standard using a modified retrospective approach. We are currently evaluating the impact that the adoption of ASU 2016-02, as amended by ASU 2018-11, may have on our consolidated financial statements and disclosures. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 replaces the current incurred loss impairment methodology with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to estimate credit losses. ASU 2016-13 is effective for our fiscal year beginning November 1, 2020, with early adoption permitted as of November 1, 2019. We are currently evaluating the impact that the adoption of ASU 2016-13 may have on our consolidated financial statements and disclosures.
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Inventory (Tables) |
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Inventory Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory | Inventory at April 30, 2019 and October 31, 2018 consisted of the following (amounts in thousands):
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Temporarily Closed communities | Information regarding the classification, number, and carrying value of these temporarily closed communities, as of the dates indicated, is provided in the table below:
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Inventory impairment charges and expensing of costs that it is believed not to be recoverable | The amounts we have provided for inventory impairment charges and the expensing of costs that we believed not to be recoverable, for the periods indicated, are shown in the table below (amounts in thousands):
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Interest incurred, capitalized and expensed | Interest incurred, capitalized, and expensed, for the periods indicated, was as follows (amounts in thousands):
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Investments in Unconsolidated Entities (Tables) |
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Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Joint Venture Information [Table Text Block] | The table below provides information as of April 30, 2019, regarding active joint ventures that we are invested in, by joint venture category ($ amounts in thousands):
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Summary of Joint Ventures Borrowing information [Table Text Block] | Certain joint ventures in which we have investments obtained debt financing to finance a portion of their activities. The table below provides information at April 30, 2019, regarding the debt financing obtained by category ($ amounts in thousands):
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Condensed balance sheet | Condensed Balance Sheets:
(1) Differences between our net investment in unconsolidated entities and our underlying equity in the net assets of the entities are primarily a result of impairments related to our investments in unconsolidated entities; interest capitalized on our investments; the estimated fair value of the guarantees provided to the joint ventures; unrealized gains on our retained joint venture interests; gains recognized from the sale of our ownership interests; and distributions from entities in excess of the carrying amount of our net investment.
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Condensed statements of operations and comprehensive income | Condensed Statements of Operations:
(1) Differences between our equity in earnings of unconsolidated entities and the underlying net income of the entities are primarily a result of a basis difference of an acquired joint venture interest; distributions from entities in excess of the carrying amount of our net investment; recoveries of previously incurred charges; unrealized gains on our retained joint venture interests; and our share of the entities’ profits related to home sites purchased by us which reduces our cost basis of the home sites acquired.
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Receivables, Prepaid Expenses, and Other Assets (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables, prepaid expenses and other assets [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Receivables, prepaid expenses, and other assets [Table Text Block] | Receivables, prepaid expenses, and other assets at April 30, 2019 and October 31, 2018, consisted of the following (amounts in thousands):
See Note 7, “Accrued Expenses,” for additional information regarding the expected recoveries from insurance carriers and others.
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Loans Payable, Senior Notes and Mortgage Company Loan Facility Loans Payable (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans Payable [Text Block] | At April 30, 2019 and October 31, 2018, loans payable consisted of the following (amounts in thousands):
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Accrued Expenses (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Payables and Accruals [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued expenses | Accrued expenses at April 30, 2019 and October 31, 2018 consisted of the following (amounts in thousands):
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Changes in the warranty accrual | The table below provides, for the periods indicated, a reconciliation of the changes in our warranty accrual (amounts in thousands):
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Stock-Based Benefit Plans (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation expense and income tax benefit recognized | Information regarding the amount of total stock-based compensation expense and tax benefit recognized by us, for the periods indicated, is as follows (amounts in thousands):
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Stock Repurchase Program and Cash Dividend (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock Repurchase Program [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock repurchase program | The table below provides, for the periods indicated, information about our share repurchase programs:
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Earnings Per Share Information (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income per share calculation | The table below provides, for the periods indicated, information pertaining to the calculation of earnings per share, common stock equivalents, weighted-average number of antidilutive options, and shares issued (amounts in thousands):
(2) Weighted-average number of antidilutive options and restricted stock units are based upon the average closing price of our common stock on the New York Stock Exchange for the perio
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Fair Value Disclosures (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of assets and (liabilities), measured at fair value on a recurring basis | The table below provides, as of the dates indicated, a summary of assets/(liabilities) related to our financial instruments, measured at fair value on a recurring basis (amounts in thousands):
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Aggregate unpaid principal and fair value of mortgage loans held for sale | The table below provides, as of the dates indicated, the aggregate unpaid principal and fair value of mortgage loans held for sale (amounts in thousands):
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Fair value of inventory adjusted for impairment | The table below provides, for the periods indicated, the number of operating communities that we reviewed for potential impairment, the number of operating communities in which we recognized impairment charges, the amount of impairment charges recognized, and, as of the end of the period indicated, the fair value of those communities, net of impairment charges ($ amounts in thousands):
(3) Includes $7.3 million of impairments from two communities located in our Mid-Atlantic segment.
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Book value and estimated fair value of the Company's debt | The table below provides, as of the dates indicated, the book value and estimated fair value of our debt (amounts in thousands):
(3) We believe that the carrying value of our mortgage company loan borrowings approximates their fair value.
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Operating communities [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Assets and Liabilities Measured on Nonrecurring Basis, Valuation Techniques [Table Text Block] | The table below summarizes, for the periods indicated, the ranges of certain quantitative unobservable inputs utilized in determining the fair value of impaired operating communities:
(1) The impairment charges recognized were related to our decisions to sell lots in a bulk sale in certain communities rather than sell and construct homes as previously intended. The sale price per lot used in the fair value determination for these bulk sales ranged from $10,000 to $155,000.
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Other Income - Net (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income and Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income - net | The table below provides the significant components of other income – net (amounts in thousands):
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Revenues and expenses of non-core ancillary businesses | The table below provides, for the periods indicated, revenues and expenses for our ancillary businesses (amounts in thousands):
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Schedule of revenues and expenses from land sales [Table Text Block] | The table below provides revenues and expenses recognized from land sales for the periods indicated (amounts in thousands):
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Commitments and Contingencies (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Company land purchase commitments | Information regarding our land purchase commitments, as of the dates indicated, is provided in the table below (amounts in thousands):
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Company mortgage commitments | Information regarding our mortgage commitments, as of the dates indicated, is provided in the table below (amounts in thousands):
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Information on Segments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue and income (loss) before income taxes and total assets | Revenue and income (loss) before income taxes for each of our segments, for the periods indicated, were as follows (amounts in thousands):
“Corporate and other” is comprised principally of general corporate expenses such as our executive offices; the corporate finance, accounting, audit, tax, human resources, risk management, information technology, marketing, and legal groups; interest income; income from certain of our ancillary businesses, including Gibraltar; and income from our Rental Property Joint Ventures and Gibraltar Joint Ventures. Total assets for each of our segments, as of the dates indicated, are shown in the table below (amounts in thousands):
“Corporate and other” is comprised principally of cash and cash equivalents, restricted cash, deferred tax assets, investments in our Rental Property Joint Ventures, expected recoveries from insurance carriers and suppliers, our Gibraltar investments and operations, manufacturing facilities, and our mortgage and title subsidiaries.
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Supplemental Disclosure to Condensed Consolidated Statements of Cash Flows (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Apr. 30, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Cash Flow Elements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental disclosures to the statements of cash flows | The following are supplemental disclosures to the Condensed Consolidated Statements of Cash Flows, for the periods indicated (amounts in thousands):
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Supplemental Guarantor Information (Tables) |
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Supplemental Guarantor Information [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Senior Notes issued by Subsidiary Issuer [Table Text Block] | At April 30, 2019, our 100%-owned subsidiary, Toll Brothers Finance Corp. (the “Subsidiary Issuer”), has issued the following outstanding Senior Notes (amounts in thousands):
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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 April 30, 2019:
Condensed Consolidating Balance Sheet at October 31, 2018:
Condensed Consolidating Statement of Operations and Comprehensive Income for the six months ended April 30, 2019:
Condensed Consolidating Statement of Operations and Comprehensive Income for the six months ended April 30, 2018:
Condensed Consolidating Statement of Operations and Comprehensive Income for the three months ended April 30, 2019:
Condensed Consolidating Statement of Operations and Comprehensive Income for the three months ended April 30, 2018:
Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2019:
Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2018:
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Acquisition - Subsequent Event (Details Textuals) |
1 Months Ended | ||
---|---|---|---|
May 31, 2019
USD ($)
communities
home_sites
|
May 20, 2019
USD ($)
home_sites
|
Apr. 30, 2019
USD ($)
luxury_homes
|
|
Business Acquisition [Line Items] | |||
Number of Homes to be Delivered | luxury_homes | 6,467 | ||
Sales Value of Outstanding Homes to be Delivered | $ 5,660,000,000 | ||
Sharp Residential [Member] | |||
Business Acquisition [Line Items] | |||
Business Acquisition, Name of Acquired Entity | Sharp Residential, LLC | ||
Payments to Acquire Businesses, Net of Cash Acquired | $ 93,200,000 | ||
Number of home sites included in acquisition | home_sites | 950 | ||
Number of Homes to be Delivered | home_sites | 125 | ||
Sales Value of Outstanding Homes to be Delivered | $ 66,100,000 | ||
Average Sales Price of Backlog | $ 528,900 | ||
Business acquisition, number of selling communities | communities | 10 |
Inventory (Details) - USD ($) $ in Thousands |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Total Inventory | ||
Inventory | $ 7,790,840 | $ 7,598,219 |
Land controlled for future communities [Member] | ||
Total Inventory | ||
Inventory | 174,116 | 139,985 |
Land Owned for Future Communities [Member] | ||
Total Inventory | ||
Inventory | 934,774 | 916,616 |
Operating communities [Member] | ||
Total Inventory | ||
Inventory | $ 6,681,950 | $ 6,541,618 |
Inventory (Details 1) $ in Thousands |
Apr. 30, 2019
USD ($)
communities
|
Oct. 31, 2018
USD ($)
communities
|
---|---|---|
Land Owned for Future Communities [Member] | ||
Temporarily Closed communities | ||
Number of Communities (in ones) | communities | 15 | 17 |
Carrying Value | $ | $ 105,281 | $ 124,426 |
Operating communities [Member] | ||
Temporarily Closed communities | ||
Number of Communities (in ones) | communities | 3 | 1 |
Carrying Value | $ | $ 21,931 | $ 2,622 |
Inventory (Details 2) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Schedule of inventory [Line Items] | ||||
Inventory Write-down | $ 19,394 | $ 13,832 | $ 26,956 | $ 17,685 |
Land controlled for future communities [Member] | ||||
Schedule of inventory [Line Items] | ||||
Inventory Write-down | 1,899 | 260 | 3,676 | 377 |
Land Owned for Future Communities [Member] | ||||
Schedule of inventory [Line Items] | ||||
Inventory Write-down | 247 | 247 | ||
Operating communities [Member] | ||||
Schedule of inventory [Line Items] | ||||
Inventory Write-down | $ 17,495 | $ 13,325 | $ 23,280 | $ 17,061 |
Inventory (Details 3) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Real estate inventory capitalized interest costs [Line Items] | ||||
Interest capitalized, beginning of period | $ 330,167 | $ 354,496 | $ 319,364 | $ 352,049 |
Interest incurred | 43,440 | 42,582 | 87,862 | 81,269 |
Interest expensed in other income | (285) | (1,001) | ||
Interest capitalized on investments in unconsolidated entities | (1,270) | (1,891) | (3,084) | (3,602) |
Previously capitalized interest on investments in unconsolidated entities transferred to inventory | 1,315 | 43 | 4,303 | 115 |
Interest capitalized, end of period | 328,583 | 349,918 | 328,583 | 349,918 |
Home Building [Member] | ||||
Real estate inventory capitalized interest costs [Line Items] | ||||
Interest expensed to cost of revenues | (44,786) | (45,027) | (79,227) | (78,912) |
Land [Member] | ||||
Real estate inventory capitalized interest costs [Line Items] | ||||
Interest expensed to cost of revenues | $ (283) | $ (635) |
Investments in Unconsolidated Entities (Details 3) - USD ($) $ in Thousands |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Condensed Balance Sheets: | ||
Cash and cash equivalents | $ 90,183 | $ 102,462 |
Inventory | 803,161 | 973,990 |
Loans receivable, net | 38,887 | 40,065 |
Rental properties | 1,070,823 | 808,785 |
Rental properties under development | 348,886 | 437,586 |
Real estate owned ("REO") | 14,860 | 14,838 |
Other assets | 168,261 | 166,029 |
Total assets | 2,535,061 | 2,543,755 |
Debt | 1,240,577 | 1,145,998 |
Other liabilities | 181,247 | 158,570 |
Member's equity | 1,110,319 | 1,235,974 |
Noncontrolling interest | 2,918 | 3,213 |
Total liabilities and equity | 2,535,061 | 2,543,755 |
Investments in unconsolidated entities | $ 390,085 | $ 431,813 |
Investments in Unconsolidated Entities (Details 4) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Condensed Statements of Operations and Comprehensive Income: | ||||
Revenues | $ 178,388 | $ 82,663 | $ 331,617 | $ 276,284 |
Cost of revenues | 157,196 | 60,660 | 288,951 | 209,410 |
Other expenses | 22,879 | 20,297 | 41,354 | 44,584 |
Total expenses | 180,075 | 80,957 | 330,305 | 253,994 |
Gain on disposition of loans and REO | 0 | 11,809 | 3,694 | 26,480 |
Income (loss) from operations | (1,687) | 13,515 | 5,006 | 48,770 |
Other income | 1,090 | 1,502 | 1,737 | 80,866 |
Income before income taxes | (597) | 15,017 | 6,743 | 129,636 |
Income tax provision | (40) | 151 | 225 | 349 |
Net income including earnings from noncontrolling interests | (557) | 14,866 | 6,518 | 129,287 |
Less: (income) loss attributable to noncontrolling interest | 31 | (5,855) | (2,078) | (11,937) |
Net income (loss) attributable to controlling interest | (526) | 9,011 | 4,440 | 117,350 |
Income (loss) from unconsolidated entities | $ 4,419 | $ 2,564 | $ 10,559 | $ 41,444 |
Receivables, Prepaid Expenses, and Other Assets (Details) - USD ($) $ in Thousands |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Receivables, prepaid expenses and other assets [Abstract] | ||
Expected recoveries from insurance carriers and others | $ 121,354 | $ 126,291 |
Improvement cost receivable | 103,377 | 96,937 |
Escrow cash held by our captive title company | 32,787 | 33,471 |
Property held for rental apartment and commercial development | 302,706 | 193,015 |
Prepaid expenses | 19,418 | 23,065 |
Other | 80,126 | 77,999 |
Receivables, Prepaid Expenses and Other Assets | $ 659,768 | $ 550,778 |
Loans Payable, Senior Notes and Mortgage Company Loan Facility Loans Payable (Details) - USD ($) $ in Thousands |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Debt Instrument [Line Items] | ||
Other Loans Payable | $ 230,305 | $ 188,115 |
Loans payable | 1,027,408 | 686,801 |
Senior unsecured term loan [Member] | ||
Debt Instrument [Line Items] | ||
Unsecured Long-term Debt, Noncurrent | 800,000 | 500,000 |
Deferred Finance Costs, Net | $ (2,897) | $ (1,314) |
Loans Payable, Senior Notes and Mortgage Company Loan Facility Term Loan Facility (Details Textual 1) - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
Apr. 30, 2019 |
Oct. 31, 2018 |
|
Senior unsecured term loan [Member] | ||
Debt Instrument [Line Items] | ||
Unsecured Long-term Debt, Noncurrent | $ 800,000 | $ 500,000 |
Debt Instrument, Term | 5 years | |
Debt Instrument, Maturity Date | Nov. 01, 2023 | |
Maximum borrowing capacity for unsecured long-term debt | $ 1,000,000 | |
Debt Instrument, Interest Rate at Period End | 3.78% | |
Maximum Permissible Leverage Ratio | 175.00% | |
Minimum Net Worth Required for Compliance | $ 2,760,000 | |
Existing Leverage Ratio | 0.56 | |
Tangible Net Worth | $ 4,900,000 | |
Ability to repurchase common stock | 3,350,000 | |
Ability to pay dividends | $ 2,140,000 | |
Guarantor Subsidiaries [Member] | ||
Debt Instrument [Line Items] | ||
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% |
Loans Payable, Senior Notes and Mortgage Company Loan Facility Credit Facility (Details Textual 2) $ in Thousands |
6 Months Ended |
---|---|
Apr. 30, 2019
USD ($)
| |
Line of Credit Facility [Line Items] | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,572,224 |
Long-term Line of Credit | 1,248,835 |
May 2016 Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,295,000 |
Debt Instrument, Term | 5 years |
Maximum Permissible Leverage Ratio | 175.00% |
Minimum Net Worth Required for Compliance | $ 2,590,000 |
Existing Leverage Ratio | 0.56 |
Tangible Net Worth | $ 4,900,000 |
Ability to repurchase common stock | 3,000,000 |
Ability to pay dividends | 2,310,000 |
Long-term Line of Credit | 0 |
Letters of Credit Outstanding, Amount | $ 179,300 |
Debt Instrument, Interest Rate at Period End | 3.98% |
Guarantor Subsidiaries [Member] | |
Line of Credit Facility [Line Items] | |
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% |
Loans Payable, Senior Notes and Mortgage Company Loan Facility Loans Payable - Other (Details Textual 3) |
Apr. 30, 2019 |
---|---|
Loans Payable [Member] | |
Debt Instrument [Line Items] | |
Debt, Weighted Average Interest Rate | 4.81% |
Loans Payable, Senior Notes and Mortgage Company Loan Facility Senior Notes Payable (Details Textual 4) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2018
USD ($)
|
Apr. 30, 2019
USD ($)
debtissuances
|
Apr. 30, 2018
USD ($)
|
Oct. 31, 2018
USD ($)
|
|
Senior Note Payable (Textual) [Abstract] | ||||
Number of issuances of senior debt | debtissuances | 7 | |||
Proceeds from Issuance of Senior Long-term Debt | $ 2,512,404 | $ 2,861,375 | ||
Repayments of Senior Debt | 350,000 | |||
Senior Notes [Member] | ||||
Senior Note Payable (Textual) [Abstract] | ||||
Debt Instrument, Face Amount | 2,520,000 | |||
4.350% Senior Notes Due 2028 [Member] | ||||
Senior Note Payable (Textual) [Abstract] | ||||
Proceeds from Issuance of Senior Long-term Debt | $ 400,000 | |||
Debt Instrument, Interest Rate, Stated Percentage | 4.35% | |||
Proceeds from Debt, Net of Issuance Costs | $ 396,400 | |||
Four percent Senior Notes due two thousand and eighteen [Member] | ||||
Senior Note Payable (Textual) [Abstract] | ||||
Debt Instrument, Interest Rate, Stated Percentage | 4.00% | |||
Repayments of Senior Debt | $ 350,000 |
Loans Payable, Senior Notes and Mortgage Company Loan Facility Mortgage Company Loan Facility (Details Textual 5) $ in Thousands |
6 Months Ended |
---|---|
Apr. 30, 2019
USD ($)
| |
Line of Credit Facility [Line Items] | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,572,224 |
Warehouse Agreement Borrowings [Member] | |
Line of Credit Facility [Line Items] | |
Line of Credit Facility, Current Borrowing Capacity | 75,000 |
Line of Credit Facility, Maximum Borrowing Capacity | $ 150,000 |
Debt Instrument, Maturity Date | Dec. 06, 2019 |
Debt Instrument, Interest Rate, Effective Percentage | 4.38% |
London Interbank Offered Rate (LIBOR) [Member] | Warehouse Agreement Borrowings [Member] | |
Line of Credit Facility [Line Items] | |
Debt Instrument, Basis Spread on Variable Rate | 1.90% |
Accrued Expenses (Details) - USD ($) $ in Thousands |
Apr. 30, 2019 |
Jan. 31, 2019 |
Oct. 31, 2018 |
Apr. 30, 2018 |
Jan. 31, 2018 |
Oct. 31, 2017 |
---|---|---|---|---|---|---|
Accrued expenses | ||||||
Land, land development and construction | $ 178,474 | $ 213,641 | ||||
Compensation and employee benefits | 136,715 | 159,374 | ||||
Escrow liability | 31,809 | 32,543 | ||||
Self-insurance | 182,275 | 168,012 | ||||
Warranty | 223,655 | $ 237,326 | 258,831 | $ 297,343 | $ 311,450 | $ 329,278 |
Deferred income | 43,993 | 42,179 | ||||
Interest | 37,882 | 40,325 | ||||
Commitments to unconsolidated entities | 8,653 | 10,553 | ||||
Other | 47,212 | 48,123 | ||||
Accrued expenses, Total | $ 890,668 | $ 973,581 |
Accrued Expenses (Detail Textuals) - USD ($) $ in Thousands |
12 Months Ended | 57 Months Ended | |||||
---|---|---|---|---|---|---|---|
Oct. 31, 2016 |
Apr. 30, 2019 |
Jan. 31, 2019 |
Oct. 31, 2018 |
Apr. 30, 2018 |
Jan. 31, 2018 |
Oct. 31, 2017 |
|
Loss Contingencies [Line Items] | |||||||
Standard and Extended Product Warranty Accrual | $ 223,655 | $ 237,326 | $ 258,831 | $ 297,343 | $ 311,450 | $ 329,278 | |
Loss Contingency, Receivable | 121,354 | 126,291 | |||||
Water intrusion related [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Loss Contingency, Estimate of Possible Loss | $ 324,400 | 324,400 | |||||
Standard and Extended Product Warranty Accrual | 148,100 | 177,600 | |||||
Other Assets [Member] | Water intrusion related [Member] | |||||||
Loss Contingencies [Line Items] | |||||||
Product Liability Contingency, Third Party Recovery | $ 152,600 | 152,600 | |||||
Loss Contingency, Receivable | $ 104,100 | $ 109,300 |
Accrued Expenses (Details 1) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Changes in the warranty accrual | ||||
Balance, beginning of year | $ 237,326 | $ 311,450 | $ 258,831 | $ 329,278 |
Additions - homes closed during the period | 8,329 | 8,462 | 14,954 | 14,687 |
Charges incurred | (22,963) | (23,780) | (50,402) | (49,776) |
Balance, end of year | 223,655 | 297,343 | 223,655 | 297,343 |
Warranty change, homes closed in prior period, other [Member] | ||||
Changes in the warranty accrual | ||||
Increase to accruals for homes closed in prior years | $ 963 | $ 1,211 | $ 272 | $ 3,154 |
Stock-Based Benefit Plans (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense recognized | $ 5,331 | $ 6,458 | $ 13,916 | $ 15,347 |
Income tax benefit recognized | $ 1,396 | $ 1,843 | $ 3,652 | $ 4,359 |
Stock-Based Benefit Plans (Details Textual) - USD ($) $ in Millions |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unamortized value of outstanding stock-based compensation awards | $ 30.1 | $ 20.9 |
Stock Repurchase Program and Cash Dividend (Details) - $ / shares shares in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Stock Repurchase Program [Abstract] | ||||
Number of shares purchased | 3 | 1,794 | 788 | 6,221 |
Average price per share | $ 36.95 | $ 45.44 | $ 32.04 | $ 46.86 |
Remaining authorization at April 30: | 19,784 | 16,876 | 19,784 | 16,876 |
Stock Repurchase Program and Cash Dividend (Details Textual 1) - $ / shares |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Stock Repurchase Program and Cash Dividend [Abstract] | ||||
Common Stock, Dividends, Per Share, Declared and Paid | $ 0.11 | $ 0.08 | $ 0.22 | $ 0.19 |
Earnings Per Share Information (Details) - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Earnings Per Share [Abstract] | ||||
Net income as reported | $ 129,324 | $ 111,810 | $ 241,374 | $ 243,917 |
Basic weighted-average shares | 146,622 | 152,731 | 146,687 | 154,306 |
Common stock equivalents | 1,507 | 2,398 | 1,394 | 2,707 |
Diluted weighted-average shares | 148,129 | 155,129 | 148,081 | 157,013 |
Debt Instrument [Line Items] | ||||
Shares issued under stock incentive and employee stock purchase plans | 144 | 57 | 654 | 880 |
Restricted Stock Units RSU And Employee Stock Option Member [Member] | ||||
Debt Instrument [Line Items] | ||||
Weighted-average number of antidilutive options and restricted stock units | 756 | 278 | 1,690 | 823 |
Fair Value Disclosures (Level 4 FV of Fin Instr) (Details) - Fair Value, Measurements, Recurring [Member] - Level 2 [Member] - USD ($) $ in Thousands |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Forward Contracts [Member] | Residential Mortgage [Member] | ||
Summary of assets and (liabilities), measured at fair value on a recurring basis | ||
Derivative Asset | $ 87 | $ 1,750 |
Assets Held-for-sale [Member] | Residential Mortgage [Member] | ||
Summary of assets and (liabilities), measured at fair value on a recurring basis | ||
Loans Held-for-sale, Fair Value Disclosure | 124,940 | 170,731 |
Interest Rate Lock Commitments [Member] | Forward Contracts [Member] | ||
Summary of assets and (liabilities), measured at fair value on a recurring basis | ||
Derivative Liability | (2,330) | |
Derivative Asset | 4,366 | |
Interest Rate Lock Commitments [Member] | ||
Summary of assets and (liabilities), measured at fair value on a recurring basis | ||
Derivative Liability | $ (4,366) | |
Derivative Asset | $ 2,330 |
Fair Value Disclosures (Level 4 loan UPB vs FV) (Details 1) - USD ($) $ in Thousands |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Aggregate unpaid principal and fair value of mortgage loans held for sale | ||
Mortgage Loans on Real Estate, Commercial and Consumer, Net | $ 124,940 | $ 170,731 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | Assets Held-for-sale [Member] | Residential Mortgage [Member] | ||
Aggregate unpaid principal and fair value of mortgage loans held for sale | ||
Aggregate unpaid principal balance | 123,529 | 170,728 |
Mortgage Loans on Real Estate, Commercial and Consumer, Net | 124,940 | 170,731 |
Fair Value, Option, Aggregate Differences, Loans and Long-term Receivables | $ 1,411 | $ 3 |
Other Income - Net (Details 1) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Apr. 30, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Revenues and expenses from land sales [Abstract] | ||||
Revenues | $ 1,716,094 | $ 1,599,199 | $ 3,079,275 | $ 2,774,667 |
Cost of revenues | (1,377,268) | (1,298,157) | (2,453,766) | (2,232,637) |
Income from land sales | 2,587 | 3,287 | ||
Land sales prior [Member] | ||||
Revenues and expenses from land sales [Abstract] | ||||
Revenues | 34,384 | 41,352 | ||
Cost of revenues | (31,797) | (38,065) | ||
Income from land sales | $ 2,587 | $ 3,287 |
Other Income - Net (Details Textual) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Apr. 30, 2019 |
Jan. 31, 2019 |
Apr. 30, 2018 |
Apr. 30, 2019 |
Apr. 30, 2018 |
|
Schedule of Equity Method Investments [Line Items] | |||||
Proceeds from sale of golf club property | $ 18,200 | $ 33,539 | |||
Gain (Loss) on Disposition of Business | $ 1,145 | $ 12,200 | 13,331 | ||
Income from Ancillary Businesses, net | 4,242 | 4,873 | 18,086 | 7,456 | |
Apartment living [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Income from Ancillary Businesses, net | $ 2,100 | $ 1,700 | $ 4,700 | $ 4,000 |
Commitments and Contingencies (Details Textual) $ in Thousands |
Apr. 30, 2019
USD ($)
home_sites
|
Oct. 31, 2018
USD ($)
|
---|---|---|
Long-term Purchase Commitment [Line Items] | ||
Purchase Obligation | $ 2,451,265 | $ 2,532,895 |
Land for Apartment Development Purchase Commitment [Member] | ||
Long-term Purchase Commitment [Line Items] | ||
Purchase Obligation | 326,900 | |
Deposits against Aggregate Purchase Commitments | $ 14,300 | |
Land Development Joint Ventures [Member] | Commitment To Acquire Home Sites [Member] | ||
Long-term Purchase Commitment [Line Items] | ||
Unrecorded Unconditional Purchase Obligation, Maximum Quantity | home_sites | 2,600 |
Commitments and Contingencies (Details Textual 1) $ in Millions |
Apr. 30, 2019
USD ($)
luxury_homes
|
---|---|
Backlog Information [Abstract] | |
Number of homes to be delivered (in ones) | luxury_homes | 6,467 |
Aggregate sales value of outstanding homes to be delivered | $ 5,660.0 |
May 2016 Revolving Credit Facility [Member] | |
Loss Contingencies [Line Items] | |
Outstanding letter of credit | 179.3 |
Surety Bond Construction Improvements [Member] | |
Loss Contingencies [Line Items] | |
Outstanding Surety Bonds Amount | 734.2 |
Amount of work remains on improvements in the Company's various communities | 334.5 |
Surety Bond Other Obligations [Member] | |
Loss Contingencies [Line Items] | |
Additional outstanding surety bonds | $ 175.4 |
Commitments and Contingencies (Details 1) - Loan Origination Commitments [Member] - USD ($) $ in Thousands |
Apr. 30, 2019 |
Oct. 31, 2018 |
---|---|---|
Company's mortgage commitments | ||
Unused Commitments to Extend Credit | $ 1,927,256 | $ 1,943,929 |
Investor commitments to purchase | 928,604 | 777,463 |
Interest Rate Lock Commitments [Member] | ||
Company's mortgage commitments | ||
Unused Commitments to Extend Credit | 813,497 | 614,255 |
Investor commitments to purchase | 813,497 | 614,255 |
Non Interest Rate Lock Commitments [Member] | ||
Company's mortgage commitments | ||
Unused Commitments to Extend Credit | 1,113,759 | 1,329,674 |
Mortgage Receivable [Member] | ||
Company's mortgage commitments | ||
Investor commitments to purchase | $ 115,107 | $ 163,208 |
Information on Segments (Details Textual) |
6 Months Ended |
---|---|
Apr. 30, 2019 | |
Information on Segments [Abstract] | |
Number of Segments | 2 |
Number of Geographic Segments | 5 |
Supplemental Guarantor Information Supplemental Guarantor Information (Level 4 Textuals) (Details) |
Apr. 30, 2019 |
---|---|
Entity Information [Line Items] | |
Supplemental Guarantor Information, consolidated net worth of released guarantor subsidiary | 5.00% |
supplemental guarantor information, consolidated net worth of all released guarantor subsidiaries | 10.00% |
supplemental guarantor information, consolidated net worth, all released guarantor subs, default cure | 15.00% |
Subsidiary Issuer [Member] | |
Entity Information [Line Items] | |
Subsidiary of Company, Ownership Percentage by Parent | 100.00% |
Guarantor Subsidiaries [Member] | |
Entity Information [Line Items] | |
Subsidiary of Company, Ownership Percentage by Parent | 100.00% |
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