OPERATING AND REPORTING SEGMENTS

6 Months Ended

Jun. 30, 2020

We operate with two principal business segments: homebuilding and financial services. As defined in ASC 280-10, Segment Reporting, we have nine homebuilding operating segments. The homebuilding segments are engaged in the business of acquiring and developing land, constructing homes, marketing and selling those homes and providing warranty and customer services. We aggregate our homebuilding operating segments into reporting segments based on similar long-term economic characteristics and geographical proximity. Our current reportable homebuilding segments are as follows:


			West:			Arizona, California and Colorado
			Central:			Texas
			East:			Florida, Georgia, North Carolina, South Carolina and Tennessee

Management’s evaluation of segment performance is based on segment operating income, which we define as home and land closing revenues less cost of home and land closings, commissions and other sales costs, land development and other land sales costs and other costs incurred by or allocated to each segment, including impairments. Each reportable segment follows the same accounting policies described in Note 1, “Organization and Basis of Presentation.” Operating results for each segment may not be indicative of the results for such segment had it been an independent, stand-alone entity for the periods presented.

The following segment information is in thousands:


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Homebuilding revenue ⁽¹⁾:
West	$	382,245	$	299,002	$	764,493	$	571,968
Central	296,357		290,532		556,484		482,138
East	354,477		275,076		613,115		518,649
Consolidated total	$	1,033,079	$	864,610	$	1,934,092	$	1,572,755
Homebuilding segment operating income:
West	$	44,742	$	24,074	$	86,636	$	42,382
Central	37,895		28,480		66,814		40,816
East	37,791		19,216		59,552		28,909
Total homebuilding segment operating income	120,428		71,770		213,002		112,107
Financial services segment profit	3,789		6,031		6,627		10,733
Corporate and unallocated costs ⁽²⁾	(7,764)		(9,298)		(16,938)		(18,928)
Interest expense	(2,105)		(3,197)		(2,121)		(7,282)
Other income, net	1,514		2,368		2,125		3,414
Net earnings before income taxes	$	115,862	$	67,674	$	202,695	$	100,044

(1)Homebuilding revenue includes the following land closing revenue, by segment, as outlined in the table below:


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Land closing revenue:
West	$	456	$	30	$	4,974	$	30
Central	382		693		4,600		693
East	650		834		2,510		10,329
Total	$	1,488	$	1,557	$	12,084	$	11,052

(2)Balance consists primarily of corporate costs and numerous shared service functions such as finance and treasury that are not allocated to the homebuilding or financial services reporting segments.


	At June 30, 2020
	West			Central			East			Financial Services		Corporate and Unallocated			Total
Deposits on real estate under option or contract	$	10,952		$	13,232		$	23,648		$	—	$	—		$	47,832
Real estate	1,205,741			718,760			808,927			—		—			2,733,428
Investments in unconsolidated entities	260			2,999			—			—		387			3,646
Other assets	59,928		(1)	116,232		(2)	88,167		(3)	659		491,836		(4)	756,822
Total assets	$	1,276,881		$	851,223		$	920,742		$	659	$	492,223		$	3,541,728

(1)Balance consists primarily of cash and property and equipment.

(2)Balance consists primarily of development reimbursements from local municipalities and prepaid expenses and other assets.

(3)Balance consists primarily of goodwill (see Note 9), prepaid expenses and other assets and property and equipment.

(4)Balance consists primarily of cash, our deferred tax asset and prepaid expenses and other assets.


	At December 31, 2019
	West			Central			East			Financial Services		Corporate and Unallocated			Total
Deposits on real estate under option or contract	$	10,568		$	10,963		$	29,370		$	—	$	—		$	50,901
Real estate	1,223,949			708,786			811,626			—		—			2,744,361
Investments in unconsolidated entities	260			3,508			—			—		675			4,443
Other assets	58,173		(1)	107,791		(2)	83,475		(3)	765		348,340		(4)	598,544
Total assets	$	1,292,950		$	831,048		$	924,471		$	765	$	349,015		$	3,398,249

(1)Balance consists primarily of cash and property and equipment.

(2)Balance consists primarily of development reimbursements from local municipalities and prepaid expenses and other assets.

(3)Balance consists primarily of goodwill, prepaid expenses and other assets, and property and equipment.

(4)Balance consists primarily of cash.