EX-99 3 k70764exv99.txt PRESS RELEASE DATED JULY 23, 2002 EXHIBIT 99 Investor Relations Contact: James Zeumer [PULTE HOMES LOGO] Pulte Homes, Inc. Vice President FOR IMMEDIATE RELEASE (248) 433-4597 Media Relations Contact: Valerie Dolenga Pulte Homes, Inc. Corporate Communications (248) 433-4633 PULTE HOMES ANNOUNCES 51% INCREASE IN NET INCOME; EARNINGS FROM CONTINUING OPERATIONS INCREASE TO A RECORD $1.45 PER SHARE SECOND QUARTER SIGNUPS CLIMB 60%; BACKLOG REACHES RECORD $3.3 BILLION (12,950 UNITS) BLOOMFIELD HILLS, MI, JULY 23, 2002 - Pulte Homes (NYSE: PHM) announced today record financial results for its second quarter and six months ended June 30, 2002. For the quarter, net income from continuing operations increased 49% to a record $90.4 million, or $1.45 per share, as compared to $60.6 million, or $1.40 per share, last year. Shares used in calculating second-quarter EPS increased 44% over last year to 62.4 million as a result of the Company's merger with Del Webb effective July 2001. Consolidated revenues for the quarter were $1.7 billion, an increase of 59% over prior year revenues of $1.1 billion. Higher revenues for the period reflect expanded business resulting from the Company's merger with Del Webb, as well as gains throughout Pulte Homes' operation. "Our second quarter and six-month results have Pulte Homes' operating and financial performance on track to deliver another record year," said Mark J. O'Brien, President and CEO. "Even more compelling is the record signups achieved during the quarter, which demonstrates the positive impact of the Company's acquisition strategy and the continued strength in demand for new homes. As the economic recovery continues to take hold, it is certainly reasonable to expect this demand will remain and could grow stronger as employment and consumer confidence rise." Domestic homebuilding revenues increased 58% to a second-quarter record $1.6 billion. Higher revenues for the quarter resulted from a 9% increase in average selling price to $239,000, combined with a 45% increase in home closings to 6,593 units. The year-over-year increase in second quarter closings and average sales price primarily reflects the inclusion of Del Webb units, as well as a favorable product mix. Second quarter domestic homebuilding gross profit increased 56% to $313.7 million, as compared to prior year gross profit of $200.8 million. Reported domestic homebuilding gross margins were 19.9%, as compared to 20.1% last year. Land sales during the quarter generated $34.1 million in revenues and $10.6 million in pre-tax income, as compared to $34.7 million and $12.4 million, respectively, last year. According to the Company, land sales are an important element of Pulte Homes' domestic homebuilding operations, but can fluctuate from quarter-to-quarter depending upon the timing of individual transactions. Domestic net new home orders for the quarter were 8,279, up 60% over prior year second-quarter orders of 5,178 homes. On a pro forma basis, assuming the inclusion of Del Webb's units last year, Pulte Homes' signups increased 17% for the quarter reflecting strong demand throughout its operations. Pulte's backlog as of June 30, 2002, was valued at $3.3 billion (12,950 homes), as compared to a value of $2.0 billion (8,791 homes) last year. "Customer traffic to our communities was positive throughout the quarter, with strong buyer interest across our markets and within the first-time, first and second move-up and active adult buyer segments we serve," said O'Brien. The Company's financial services operations reported first quarter pre-tax income of $16.2 million, up 116% over prior year pre-tax income of $7.5 million. The improvement in second quarter financial results reflects a 24% increase in loan originations resulting from inclusion of Del Webb business, a favorable interest rate environment and a higher capture rate of 76.7% as compared to 73.1% last year. For the second quarter, Pulte's International operations reported pre-tax income of $1.9 million, as compared to a pre-tax loss of $1.5 million for the comparable period last year. Gains for the quarter primarily reflect improved performance from the Company's Mexico operations. OTHER SECOND QUARTER HIGHLIGHTS During the quarter, it was announced that Richard J. Dugas has been named as the Company's new Chief Operating Officer. Mr. Dugas filled a position left vacant when Mark J. O'Brien assumed the role of President and Chief Executive Officer at the end of 2001. Mr. Dugas will oversee all domestic homebuilding operations and provide leadership to the Area Presidents under the Company's realigned organizational structure. Also during the quarter, Pulte Homes completed a public offering of $300 million principal amount of senior notes due 2032, with a coupon rate of 7.875%. The 30-year maturity of these notes is believed to be a first for the homebuilding industry. The Company also announced the introduction of the Del Webb brand into the Northeast market. The newest communities, Great Island by Del Webb in Plymouth, Massachusetts, and Somerset Run by Del Webb in Franklin Township, New Jersey, have both met with very strong buyer interest. Community development is already underway with home deliveries beginning in 2003. SIX MONTH RESULTS For the six months ended June 30, 2001, Pulte Homes' net income from continuing operations increased 59% to $159.0 million, or $2.57 per share, as compared with prior year net income of $99.7 million, or $2.31 per share. Shares used in calculating six-month EPS increased 43% to 61.9 million as a result of the Company's merger with Del Webb effective July 2001. Consolidated revenues for the period were $3.1 billion, up from $1.9 billion for the first six months of last year. Pulte Homes' domestic homebuilding operations reported total revenues for the period of $2.9 billion, up 59% over the prior year. Higher revenues for the period resulted from a 10% increase in average selling price to $239,000, combined with a 45% increase in the number of homes closed. The increase in average selling price and unit volumes reflect the inclusion of Del Webb operations and favorable building conditions during the period. Gross margins for the domestic homebuilding operations were comparable to last year at 20.0%, as pre-tax income increased 52% to $260.4 million. For the first six months, Pulte's financial services operations reported pre-tax income of $28.4 million, up significantly from prior year pre-tax income of $14.2 million. The improvement was driven by a 27% increase in loan originations resulting from inclusion of Del Webb business, a favorable interest rate environment and a higher capture rate of 76.0% as compared to 71.8% last year. Pulte's International operations reported net income for the first six months of $1.4 million, as compared to a pre-tax loss of $.3 million last year. The improved financial performance was driven by gains in the Company's Mexico operations. "Pulte Homes results through the first six months of 2002 are on plan, and put the Company in an excellent position to deliver earnings at the high end of our guidance range of $6.75 to $7.00 per share. Our recent sales pace suggests that buyer demand remains strong and that we have the opportunity to deliver increased year-over-year signups for the back half of the year. Such results would provide Pulte Homes with a solid backlog and great momentum heading into 2003," added O'Brien. A conference call discussing Pulte Homes' second quarter results will be held today at 8:30 a.m. Eastern Time, and web cast live via Pulte.com. Interested investors can access the call via the Company's home page at www.pulte.com. AS A CAUTIONARY NOTE TO INVESTORS, EXCEPT FOR HISTORICAL INFORMATION CONTAINED HEREIN, CERTAIN MATTERS DISCUSSED IN THIS PRESS RELEASE ARE "FORWARD LOOKING STATEMENTS" WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. SUCH MATTERS INVOLVE RISKS AND UNCERTAINTIES, INCLUDING, CHANGES IN ECONOMIC CONDITIONS AND INTEREST RATES, INCREASES IN RAW MATERIAL AND LABOR COSTS, WEATHER CONDITIONS, AND GENERAL COMPETITIVE FACTORS, THAT MAY CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY. ABOUT PULTE HOMES Pulte Homes, Inc., (www.pulte.com) based in Bloomfield Hills, Michigan, has operations in more than 44 markets across the United States. Under its Del Webb (www.delwebb.com) brand, the Company is also the nation's leading builder of active adult communities for people age 55 and older. Over its history, the Company has constructed more than 300,000 homes and has been named Builder of the Year for 2002 by Professional Builder magazine. Pulte Mortgage Corporation is a nationwide lender committed to meeting the financing needs of Pulte Homes' customers by offering a wide variety of loan products and superior customer service. /Web site: http://www.pulte.com
Pulte Homes, Inc. Condensed Consolidated Results Of Operations ------------------------------------------------------------------------------ Three Months Ended Six Months Ended June 30, June 30, 2002 2001 2002 2001 ------------------------------------- ------------------------------------- (000's omitted, except per share data) (Unaudited) CONSOLIDATED RESULTS: Revenues: Homebuilding $ 1,661,670 $ 1,040,685 $ 3,017,275 $ 1,865,732 Financial Services 23,842 17,132 46,866 31,843 Corporate 51 905 163 1,622 ----------- ----------- ----------- ----------- Total Revenues $ 1,685,563 $ 1,058,722 $ 3,064,304 $ 1,899,197 =========== =========== =========== =========== Pre-tax income (loss): Homebuilding $ 146,522 $ 104,489 $ 261,856 $ 170,967 Financial Services 16,162 7,495 28,416 14,167 Corporate (14,462) (13,417) (29,516) (22,959) ----------- ----------- ----------- ----------- Income from continuing operations before income taxes 148,222 98,567 260,756 162,175 Income taxes (57,814) (37,948) (101,708) (62,437) ----------- ----------- ----------- ----------- 90,408 60,619 159,048 99,738 Income from continuing operations Loss from discontinued operations (205) (825) (733) (573) ----------- ----------- ----------- ----------- Net income $ 90,203 $ 59,794 $ 158,315 $ 99,165 =========== =========== =========== =========== EARNINGS PER SHARE - ASSUMING DILUTION: Income from continuing operations $ 1.45 $ 1.40 $ 2.57 $ 2.31 Loss from discontinued operations -- (.02) (.01) (.01) ----------- ----------- ----------- ----------- Net income $ 1.45 $ 1.38 $ 2.56 $ 2.30 =========== =========== =========== =========== Shares used in per share calculations 62,359 43,365 61,933 43,191 =========== =========== =========== ===========
Certain 2001 classifications have been changed to conform with the 2002 presentation.
Pulte Homes, Inc. Condensed Consolidated Balance Sheets ($000's omitted) (Unaudited) ------------------------------------------------------------ June 30, December 31, June 30, 2002 2001 2001 ----------------- -------------------- -------------- ASSETS Cash and equivalents $ 212,767 $ 72,144 $ 101,805 Unfunded settlements 40,109 69,631 47,604 House and land inventories 4,244,918 3,833,763 2,297,731 Residential mortgage loans available-for-sale 286,484 431,735 203,622 Goodwill 307,693 307,693 27,066 Intangible Assets 155,529 159,604 -- Other assets 859,663 839,706 549,737 ---------- ---------- ---------- $6,107,163 $5,714,276 $3,227,565 ========== ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Accounts payable and accrued liabilities $1,328,893 $1,155,702 $ 770,558 Unsecured short-term borrowings -- 110,000 -- Collateralized short-term debt, recourse solely to applicable subsidiary assets 272,925 413,675 196,186 Income taxes 88,082 35,370 36,104 Subordinated debentures and senior notes 1,949,265 1,722,864 865,347 ---------- ---------- ---------- Total Liabilities 3,639,165 3,437,611 1,868,195 Shareholders' Equity 2,467,998 2,276,665 1,359,370 ---------- ---------- ---------- $6,107,163 $5,714,276 $3,227,565 ========== ========== ==========
Certain 2001 classifications have been changed to conform with the 2002 presentation.
Pulte Homes, Inc. Segment Data Three Months Ended June 30, ------------------------------------------------ 2002 2001 ---------------- ---------------- ($000's omitted) HOMEBUILDING: Pre-tax income (loss): Domestic $ 144,577 $ 105,948 International 1,945 (1,459) ----------- ----------- Total Homebuilding $ 146,522 $ 104,489 =========== =========== Domestic Homebuilding: Home sales (settlements) $ 1,576,285 $ 997,712 Land sales 34,121 34,700 ----------- ----------- Domestic Homebuilding Revenue 1,610,406 1,032,412 Home cost of sales (1,262,544) (796,877) Land cost of sales (23,567) (22,301) Selling, general & administrative expense (163,086) (99,596) Other income (expense), net (5,265) 606 ----------- ----------- 155,944 114,244 EBIT Interest (11,367) (8,296) ----------- ----------- Pre-tax income $ 144,577 $ 105,948 =========== =========== International Homebuilding: Home sales (settlements) $ 51,264 $ 8,273 Cost of sales (40,079) (7,021) Selling, general & administrative expense (9,352) (2,654) Other expense, net (82) (82) Minority Interest (776) -- Equity in income of joint venture operations 970 25 ----------- ----------- Pre-tax income (loss) $ 1,945 $ (1,459) =========== =========== FINANCIAL SERVICES: Pre-tax income $ 16,162 $ 7,495 =========== =========== MORTGAGE ORIGINATIONS: Origination volume 4,994 4,013 =========== =========== Origination principal $ 804,400 $ 613,700 =========== =========== CORPORATE: Pre-tax loss: Net interest expense $ (9,770) $ (8,034) Other Corporate expense, net (4,692) (5,383) ----------- ----------- Total Corporate $ (14,462) $ (13,417) =========== ===========
Certain 2001 classifications have been changed to conform with the 2002 presentation.
Pulte Homes, Inc. Segment Data Six Months Ended June 30, ------------------------------------------- 2002 2001 ------------- ------------- ($000's omitted) HOMEBUILDING: Pre-tax income (loss): Domestic $ 260,428 $ 171,293 International 1,428 (326) ----------- ----------- Total Homebuilding $ 261,856 $ 170,967 =========== =========== Domestic Homebuilding: Home sales (settlements) $ 2,885,873 $ 1,803,508 Land sales 57,769 42,427 ----------- ----------- Domestic Homebuilding Revenue 2,943,642 1,845,935 Home cost of sales (2,309,469) (1,442,647) Land cost of sales (38,799) (29,022) Selling, general & administrative expense (305,881) (185,798) Other expense (9,175) (2,939) ----------- ----------- 280,318 185,529 EBIT Interest (19,890) (14,236) ----------- ----------- Pre-tax income $ 260,428 $ 171,293 =========== =========== International Homebuilding: Home sales (settlements) $ 73,633 $ 19,797 Cost of sales (57,908) (17,254) Selling, general & administrative expense (16,355) (5,254) Other income (expense), net (858) 360 Minority Interest (396) -- Equity in income of joint venture operations 3,312 2,025 ----------- ----------- Pre-tax income (loss) $ 1,428 $ (326) =========== =========== FINANCIAL SERVICES: Pre-tax income $ 28,416 $ 14,167 =========== =========== MORTGAGE ORIGINATIONS: Origination volume 9,220 7,271 =========== =========== Origination principal $ 1,476,200 $ 1,102,800 =========== =========== CORPORATE: Pre-tax loss: Net interest expense $ (19,212) $ (13,683) Other Corporate expense, net (10,304) (9,276) ----------- ----------- Total Corporate ($ 29,516) $ (22,959) =========== ===========
Certain 2001 classifications have been changed to conform with the 2002 presentation.
Pulte Homes, Inc. Business Operating Data Three Months Ended Six Months Ended June 30, June 30, ------------------------------------- ------------------------------------- 2002 2001 2002 2001 ---------------- ---------------- ---------------- ---------------- (000's omitted) HOMEBUILDING UNIT SETTLEMENTS - PULTE AND AFFILIATES: Domestic 6,593 4,551 12,095 8,319 International 1,775 1,644 3,417 3,418 ---------------- ---------------- ---------------- ---------------- Total Pulte and Pulte-affiliate settlement units 8,368 6,195 15,512 11,737 ================ ================ ================ ================ HOMEBUILDING REVENUES - PULTE AND AFFILIATES: Domestic $1,576,285 $997,712 $2,885,873 $1,803,508 International 57,919 47,575 104,741 97,507 ---------------- ---------------- ---------------- ---------------- Total Pulte and Pulte-affiliate revenues $1,634,204 $1,045,287 $2,990,614 $1,901,015 ================ ================ ================ ================ Domestic Homebuilding Unit settlements: Northeast 504 451 920 844 Southeast 1,888 1,751 3,564 3,360 Midwest 976 742 1,678 1,190 Central 1,035 870 1,753 1,502 West 2,190 737 4,180 1,423 ---------------- ---------------- ---------------- ---------------- 6,593 4,551 12,095 8,319 ================ ================ ================ ================ Unit net new orders: Northeast 660 655 1,454 1,187 Southeast 2,285 1,954 4,515 4,487 Midwest 1,246 871 2,546 1,974 Central 1,308 914 2,592 2,268 West 2,780 784 5,260 1,717 ---------------- ---------------- ---------------- ---------------- 8,279 5,178 16,367 11,633 ================ ================ ================ ================ Unit backlog: Northeast 1,365 1,153 Southeast 3,510 3,268 Midwest 2,243 1,691 Central 1,742 1,580 West 4,090 1,099 ---------------- ---------------- 12,950 8,791 ================ ================ International Homebuilding: Unit settlements: Pulte 1,732 54 2,453 143 Pulte-affiliated entities 43 1,590 964 3,275 ---------------- ---------------- ---------------- ---------------- 1,775 1,644 3,417 3,418 ================ ================ ================ ================