Business Segments

9 Months Ended

Sep. 30, 2016

Business Segments [Abstract]

Segment Reporting Disclosure [Text Block]

Business Segments

The Company’s chief operating decision makers evaluate the Company’s performance in various ways, including: (1) the results of our 15 individual homebuilding operating segments and the results of our financial services operations; (2) the results of our three homebuilding reportable segments; and (3) our consolidated financial results.

In accordance with ASC 280, Segment Reporting (“ASC 280”), we have identified each homebuilding division as an operating segment as each homebuilding division engages in business activities from which it earns revenue, primarily from the sale and construction of single-family attached and detached homes, acquisition and development of land, and the occasional sale of lots to third parties. Our financial services operations generate revenue primarily from the origination, sale and servicing of mortgage loans and title services primarily for purchasers of the Company’s homes and are included in our financial services reportable segment. In accordance with the aggregation criteria defined in ASC 280, we have determined our reportable segments as follows: Midwest homebuilding, Southern homebuilding, Mid-Atlantic homebuilding and financial services operations.  The homebuilding operating segments that are included within each reportable segment have been aggregated because they share similar aggregation characteristics as prescribed in ASC 280 in the following regards: (1) long-term economic characteristics; (2) historical and expected future long-term gross margin percentages; (3) housing products, production processes and methods of distribution; and (4) geographical proximity.  

The homebuilding operating segments that comprise each of our reportable segments are as follows:

Midwest	Southern	Mid-Atlantic
Chicago, Illinois	Orlando, Florida	Charlotte, North Carolina
Cincinnati, Ohio	Sarasota, Florida	Raleigh, North Carolina
Columbus, Ohio	Tampa, Florida	Washington, D.C.
Indianapolis, Indiana	Austin, Texas
Minneapolis/St. Paul, Minnesota	Dallas/Fort Worth, Texas
	Houston, Texas
	San Antonio, Texas

On July 1, 2016, we entered the Sarasota, Florida market.

The following table shows, by segment: revenue, operating income and interest expense for the three and nine months ended September 30, 2016 and 2015:

	Three Months Ended September 30,						Nine Months Ended September 30,
(In thousands)	2016			2015			2016			2015
Revenue:
Midwest homebuilding	$	166,928		$	128,121		$	438,016		$	331,479
Southern homebuilding	143,315			137,185			414,974			341,139
Mid-Atlantic homebuilding	121,659			88,875			284,527			250,546
Financial services (a)	10,562			9,276			30,564			26,308
Total revenue	$	442,464		$	363,457		$	1,168,081		$	949,472
Operating income:
Midwest homebuilding	$	20,628		$	13,511		$	48,943		$	33,526
Southern homebuilding (b)	(5,249		)	13,860			8,380			30,421
Mid-Atlantic homebuilding	11,359			6,350			22,827			19,376
Financial services (a)	5,944			4,856			17,581			15,425
Less: Corporate selling, general and administrative expense	(10,676		)	(8,457		)	(26,876		)	(23,051		)
Total operating income	$	22,006		$	30,120		$	70,855		$	75,697
Interest expense:
Midwest homebuilding	$	647		$	649		$	2,539		$	2,536
Southern homebuilding	1,788			1,649			6,118			5,185
Mid-Atlantic homebuilding	601			948			3,058			3,011
Financial services (a)	551			412			1,445			1,138
Total interest expense	$	3,587		$	3,658		$	13,160		$	11,870
Equity in income of unconsolidated joint ventures	(24		)	(36		)	(413		)	(248		)
Income before income taxes	$	18,443		$	26,498		$	58,108		$	64,075

(a) Our financial services operational results should be viewed in connection with our homebuilding business as its operations originate loans and provide title services primarily for our homebuying customers, with the exception of a small amount of mortgage refinancing.

(b) Includes a $14.5 million and $19.4 million charge for known and estimated future stucco-related repair costs in certain of our Florida communities (as more fully discussed in Note 6) taken during the three and nine months ended September 30, 2016, respectively.

The following tables show total assets by segment at September 30, 2016 and December 31, 2015:

	September 30, 2016
(In thousands)	Midwest		Southern		Mid-Atlantic		Corporate, Financial Services and Unallocated		Total
Deposits on real estate under option or contract	$	3,820	$	24,778	$	4,396	$	—	$	32,994
Inventory (a)	406,832		472,255		313,072		—		1,192,159
Investments in unconsolidated joint ventures	8,468		18,060		—		—		26,528
Other assets (b)	13,144		22,348		19,995		190,069		245,556
Total assets	$	432,264	$	537,441	$	337,463	$	190,069	$	1,497,237

	December 31, 2015
(In thousands)	Midwest		Southern		Mid-Atlantic		Corporate, Financial Services and Unallocated		Total
Deposits on real estate under option or contract	$	3,379	$	16,128	$	4,203	$	—	$	23,710
Inventory (a)	368,748		416,443		303,141		—		1,088,332
Investments in unconsolidated joint ventures	5,976		30,991		—		—		36,967
Other assets	10,018		23,704		7,253		225,570		266,545
Total assets	$	388,121	$	487,266	$	314,597	$	225,570	$	1,415,554

(a) Inventory includes single-family lots, land and land development costs; land held for sale; homes under construction; model homes and furnishings; community development district infrastructure; and consolidated inventory not owned.

(b) During the nine months ended September 30, 2016, the Company purchased an airplane for $9.9 million. The asset is included in the table above in Corporate, Financial Services, and Unallocated Other Assets, and within Property and Equipment - Net in our Unaudited Condensed Consolidated Balance Sheets.