CURRENT REPORT |
PURSUANT TO SECTION 13 OR 15(D) |
OF THE SECURITIES EXCHANGE ACT OF 1934 |
M/I HOMES, INC. | ||||||
(Exact name of registrant as specified in its charter) | ||||||
Ohio | 1-12434 | 31-1210837 | ||||
(State or Other Jurisdiction | (Commission | (I.R.S. Employer | ||||
of Incorporation) | File Number) | Identification No.) |
(614) 418-8000 |
(Telephone Number) |
N/A |
(Former name or former address, if changed since last report) |
Exhibit No. | Description of Documents | |
99.1 | Press release dated July 28, 2011. |
By: | /s/ Ann Marie W. Hunker |
Ann Marie W. Hunker | |
Vice President and Corporate Controller | |
(Principal Accounting Officer) |
Exhibit No. | Description of Documents | |
99.1 | Press release dated July 28, 2011. |
• | Adjusted pre-tax loss from operations of $3.5 million |
• | Net loss of $9.1 million |
• | Adjusted EBITDA of $4.9 million |
• | New contracts increased 5% |
• | Homes delivered down 25% |
• | Backlog units and value up 11% and 7% |
• | Total cash balance of $113.8 million, including $45 million of unrestricted cash |
• | Net debt to net capital ratio of 37% |
• | Closed acquisition of TriStone Homes in San Antonio, Texas |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
New contracts | 635 | 602 | 1,289 | 1,367 | |||||||||||
Average community count | 113 | 109 | 112 | 107 | |||||||||||
Cancellation rate | 20 | % | 16 | % | 18 | % | 17 | % | |||||||
Backlog units | 833 | 748 | |||||||||||||
Backlog value | $ | 214,019 | $ | 199,986 | |||||||||||
Homes delivered | 590 | 790 | 1,029 | 1,269 | |||||||||||
Average home closing price | $ | 227 | 245 | $ | 234 | $ | 243 | ||||||||
Homebuilding revenue: | |||||||||||||||
Housing revenue | $ | 134,044 | $ | 192,917 | $ | 240,564 | $ | 308,513 | |||||||
Land revenue | 105 | — | 955 | 86 | |||||||||||
Total homebuilding revenue | $ | 134,149 | $ | 192,917 | $ | 241,519 | $ | 308,599 | |||||||
Financial services revenue | 3,295 | 3,487 | 6,495 | 7,194 | |||||||||||
Total revenue | $ | 137,444 | $ | 196,404 | $ | 248,014 | $ | 315,793 | |||||||
Cost of sales - operations | 114,043 | 165,063 | 206,617 | 263,771 | |||||||||||
Cost of sales - impairment / other | 5,445 | 6,294 | 16,316 | 10,010 | |||||||||||
Gross margin | 17,956 | 25,047 | 25,081 | 42,012 | |||||||||||
General and administrative expense | 12,766 | 13,561 | 24,168 | 26,453 | |||||||||||
Selling expense | 10,754 | 14,153 | 19,408 | 24,747 | |||||||||||
Operating loss | (5,564 | ) | (2,667 | ) | (18,495 | ) | (9,188 | ) | |||||||
Interest expense | 3,465 | 2,079 | 7,500 | 4,220 | |||||||||||
Loss before income taxes | (9,029 | ) | (4,746 | ) | (25,995 | ) | (13,408 | ) | |||||||
Expense (benefit) for income taxes | 115 | 61 | 188 | (266 | ) | ||||||||||
Net loss | (9,144 | ) | (4,807 | ) | (26,183 | ) | (13,142 | ) | |||||||
Net loss per share | $ | (0.49 | ) | $ | (0.26 | ) | $ | (1.40 | ) | $ | (0.71 | ) | |||
Weighted average shares outstanding: | |||||||||||||||
Basic | 18,711 | 18,523 | 18,663 | 18,522 | |||||||||||
Diluted | 18,711 | 18,523 | 18,663 | 18,522 |
As of | |||||||
June 30, | |||||||
2011 | 2010 | ||||||
Assets: | |||||||
Total cash and cash equivalents(1) | $ | 113,802 | $ | 128,673 | |||
Mortgage loans held for sale | 35,725 | 51,944 | |||||
Inventory: | |||||||
Lots, land and land development | 250,497 | 232,171 | |||||
Land held for sale | — | 3,047 | |||||
Homes under construction | 174,314 | 171,113 | |||||
Other inventory | 37,985 | 26,917 | |||||
Total inventory | $ | 462,796 | $ | 433,248 | |||
Property and equipment - net | 15,461 | 17,778 | |||||
Investments in unconsolidated joint ventures | 10,026 | 10,569 | |||||
Income tax receivable | 1,163 | 4,450 | |||||
Other assets(2) | 14,310 | 18,494 | |||||
Total Assets | $ | 653,283 | $ | 665,156 | |||
Liabilities: | |||||||
Debt - Homebuilding Operations: | |||||||
Senior notes | $ | 238,813 | $ | 199,552 | |||
Notes payable - other | 5,801 | 6,010 | |||||
Total Debt - Homebuilding Operations | $ | 244,614 | $ | 205,562 | |||
Note payable bank - financial services operations | 32,133 | 33,911 | |||||
Total Debt | $ | 276,747 | $ | 239,473 | |||
Accounts payable | 43,191 | 48,376 | |||||
Other liabilities | 53,317 | 62,074 | |||||
Total Liabilities | $ | 373,255 | $ | 349,923 | |||
Shareholders' Equity | 280,028 | 315,233 | |||||
Total Liabilities and Shareholders' Equity | $ | 653,283 | $ | 665,156 | |||
Book value per common share | $ | 9.62 | $ | 11.62 | |||
Net debt/net capital ratio(3) | 37 | % | 26 | % |
(1) | 2011 and 2010 amounts include $68.9 million and $47.1 million of restricted cash and cash held in escrow, respectively. |
(2) | 2011 and 2010 amounts include gross deferred tax assets of $138.2 million and $122.0 million, respectively, net of valuation allowances of $138.2 million and $122.0 million, respectively. |
(3) | Net debt/net capital ratio is calculated as total debt minus total cash and cash equivalents, divided by the sum of total debt minus total cash and cash equivalents plus shareholders' equity. |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
Adjusted operating gross margin(1) | $ | 23,401 | $ | 31,341 | $ | 41,397 | $ | 52,022 | |||||||
Adjusted operating gross margin %(1) | 17.0 | % | 16.0 | % | 16.7 | % | 16.5 | % | |||||||
Adjusted pre-tax (loss) income from operations(1) | $ | (3,542 | ) | $ | 1,730 | $ | (9,379 | ) | $ | (3,141 | ) | ||||
Adjusted EBITDA(1) | $ | 4,929 | $ | 11,429 | $ | 7,621 | $ | 12,774 | |||||||
Cash flow used in operating activities | $ | (11,146 | ) | $ | (13,403 | ) | $ | (8,519 | ) | $ | (18,038 | ) | |||
Cash used in investing activities | $ | (30,038 | ) | $ | (13,251 | ) | $ | (29,044 | ) | $ | (16,008 | ) | |||
Cash provided by financing activities | $ | 5,723 | $ | 5,670 | $ | 1,255 | $ | 5,718 | |||||||
Land/lot purchases | $ | 17,179 | $ | 32,861 | $ | 36,456 | $ | 58,143 | |||||||
Land development spending | $ | 12,649 | $ | 9,029 | $ | 20,214 | $ | 14,638 | |||||||
Land/lot sale proceeds | $ | 105 | $ | — | $ | 955 | $ | 86 | |||||||
Financial services pre-tax income | $ | 1,441 | $ | 1,248 | $ | 2,793 | $ | 2,981 | |||||||
Deferred tax asset valuation allowance | $ | 3,754 | $ | 1,887 | $ | 10,312 | $ | 4,921 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
Impairment by Region: | 2011 | 2010 | 2011 | 2010 | |||||||||||
Midwest | $ | 5,327 | $ | 2,971 | $ | 10,339 | $ | 2,972 | |||||||
Southern | 101 | 437 | 5,960 | 2,172 | |||||||||||
Mid-Atlantic | 17 | 2,886 | 17 | 4,266 | |||||||||||
Total | $ | 5,445 | $ | 6,294 | $ | 16,316 | $ | 9,410 | |||||||
Abandonments by Region: | |||||||||||||||
Midwest | $ | 1 | $ | 79 | $ | 22 | $ | 89 | |||||||
Southern | 29 | — | 37 | 1 | |||||||||||
Mid-Atlantic | 12 | 103 | 241 | 167 | |||||||||||
Total | $ | 42 | $ | 182 | $ | 300 | $ | 257 |
(1) | See “Non-GAAP Financial Results / Reconciliations” table below. |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
Gross margin | $ | 17,956 | $ | 25,047 | $ | 25,081 | $ | 42,012 | |||||||
Add: Impairments | 5,445 | 6,294 | 16,316 | 9,410 | |||||||||||
Imported drywall charges | — | — | — | 600 | |||||||||||
Adjusted operating gross margin | $ | 23,401 | $ | 31,341 | $ | 41,397 | $ | 52,022 | |||||||
Loss before income taxes | $ | (9,029 | ) | $ | (4,746 | ) | $ | (25,995 | ) | $ | (13,408 | ) | |||
Add: Impairments and abandonments | 5,487 | 6,476 | 16,616 | 9,667 | |||||||||||
Imported drywall charges | — | — | — | 600 | |||||||||||
Adjusted pre-tax (loss) income from operations | $ | (3,542 | ) | $ | 1,730 | $ | (9,379 | ) | $ | (3,141 | ) | ||||
Net loss | $ | (9,144 | ) | $ | (4,807 | ) | $ | (26,183 | ) | $ | (13,142 | ) | |||
Add (subtract): | |||||||||||||||
Income taxes | 115 | 61 | 188 | (266 | ) | ||||||||||
Interest expense net of interest income | 3,206 | 1,702 | 7,013 | 3,630 | |||||||||||
Interest amortized to cost of sales | 2,819 | 4,954 | 5,157 | 7,185 | |||||||||||
Depreciation and amortization | 1,888 | 2,254 | 3,789 | 4,216 | |||||||||||
Non-cash charges | 6,045 | 7,265 | 17,657 | 11,151 | |||||||||||
Adjusted EBITDA | $ | 4,929 | $ | 11,429 | $ | 7,621 | $ | 12,774 |
NEW CONTRACTS | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, | June 30, | ||||||||||||||||
% | % | ||||||||||||||||
Region | 2011 | 2010 | Change | 2011 | 2010 | Change | |||||||||||
Midwest | 308 | 310 | (1 | )% | 595 | 746 | (20 | )% | |||||||||
Southern | 143 | 133 | 8 | % | 302 | 272 | 11 | % | |||||||||
Mid-Atlantic | 184 | 159 | 16 | % | 392 | 349 | 12 | % | |||||||||
Total | 635 | 602 | 5 | % | 1,289 | 1,367 | (6 | )% |
HOMES DELIVERED | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, | June 30, | ||||||||||||||||
% | % | ||||||||||||||||
Region | 2011 | 2010 | Change | 2011 | 2010 | Change | |||||||||||
Midwest | 273 | 430 | (37 | )% | 487 | 695 | (30 | )% | |||||||||
Southern | 154 | 151 | 2 | % | 233 | 244 | (5 | )% | |||||||||
Mid-Atlantic | 163 | 209 | (22 | )% | 309 | 330 | (6 | )% | |||||||||
Total | 590 | 790 | (25 | )% | 1,029 | 1,269 | (19 | )% |
BACKLOG | |||||||||||||||||||||
June 30, 2011 | June 30, 2010 | ||||||||||||||||||||
Dollars | Average | Dollars | Average | ||||||||||||||||||
Region | Units | (millions) | Sales Price | Units | (millions) | Sales Price | |||||||||||||||
Midwest | 444 | $ | 110 | $ | 248,000 | 468 | $ | 115 | $ | 246,000 | |||||||||||
Southern | 197 | $ | 44 | $ | 225,000 | 83 | $ | 18 | $ | 212,000 | |||||||||||
Mid-Atlantic | 192 | $ | 60 | $ | 310,000 | 197 | $ | 67 | $ | 341,000 | |||||||||||
Total | 833 | $ | 214 | $ | 257,000 | 748 | $ | 200 | $ | 267,000 |
LAND POSITION SUMMARY | ||||||||||||||
June 30, 2011 | June 30, 2010 | |||||||||||||
Lots | Lots Under | Lots | Lots Under | |||||||||||
Region | Owned | Contract | Total | Owned | Contract | Total | ||||||||
Midwest | 3,990 | 1,052 | 5,042 | 4,027 | 1,286 | 5,313 | ||||||||
Southern | 1,390 | 796 | 2,186 | 1,576 | 184 | 1,760 | ||||||||
Mid-Atlantic | 1,907 | 1,152 | 3,059 | 2,069 | 419 | 2,488 | ||||||||
Total | 7,287 | 3,000 | 10,287 | 7,672 | 1,889 | 9,561 |
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