3.	Segment Reporting

We operate

two

principal businesses: homebuilding and financial services.

Our homebuilding operations acquire and develop land and construct and sell single-family attached and detached homes. In accordance with ASC Topic

280,

Segment Reporting

("ASC

280"

), we have determined that each of our

four

homebuilding regions and financial services operations (consisting of our mortgage financing and title operations) are our operating segments. Our

four

homebuilding reportable segments include: North, consisting of our divisions in Georgia, Delaware, Illinois, Indiana, Maryland, Minnesota, New Jersey, Pennsylvania, Virginia and Washington D.C.; Southeast, consisting of our divisions in Florida and the Carolinas; Southwest, consisting of our divisions in Texas, Colorado, Nevada and Utah; and West, consisting of our divisions in California, Arizona and Washington.

Our mortgage financing operation, CalAtlantic Mortgage, provides mortgage financing to many of our homebuyers in substantially all of the markets in which we operate, and sells substantially all of the loans it originates in the secondary mortgage market. Our title, escrow and insurance subsidiaries provide title, escrow and insurance services to homebuyers in many of our markets. Our mortgage financing, title, escrow and insurance services operations are included in our financial services reportable segment, which is separately reported in our condensed consolidated financial statements under "Financial Services."

Corporate is a non-operating segment that develops and implements strategic initiatives and supports our operating segments by centralizing key administrative functions such as accounting, finance and treasury, information technology, insurance and risk management, litigation, marketing and human resources. Corporate also provides the necessary administrative functions to support us as a publicly traded company. All of the expenses incurred by Corporate are allocated to each of our

four

homebuilding regions based on their respective percentage of revenues.

Segment financial information relating to the Company’s homebuilding operations was as follows:

	Three Months Ended June 30,					Six Months Ended June 30,
	2017		2016			2017		2016
	(Dollars in thousands)
Homebuilding revenues:
North	$	331,071	$	241,274		$	565,847	$	427,829
Southeast		429,269		386,836			780,372		664,318
Southwest		406,636		433,603			742,851		776,637
West		454,138		516,649			869,743		895,261
Total homebuilding revenues	$	1,621,114	$	1,578,362		$	2,958,813	$	2,764,045

Homebuilding pretax income (1):
North	$	29,732	$	17,980		$	48,597	$	27,550
Southeast		31,885		31,772			55,601		52,822
Southwest		38,932		46,907			69,109		73,833
West		47,083		74,812			96,612		125,534
Total homebuilding pretax income	$	147,632	$	171,471		$	269,919	$	279,739

Homebuilding income (loss) from unconsolidated joint ventures:
North	$	155	$	67		$	447	$	374
Southeast		―		(19	)		―		437
Southwest		154		257			263		824
West		137		(82	)		3,624		(223	)
Total homebuilding income (loss) from unconsolidated joint ventures	$	446	$	223		$	4,334	$	1,412

(

)

Homebuilding pretax income includes depreciation and amortization expense of

$2.2

million,

$4.2

million,

$3.0

million and

$5.5

million, respectively, in the North, Southeast, Southwest and West for the quarter ended

June 30, 2017

and

$1.5

million,

$4.2

million,

$3.2

million and

$6.5

million, respectively, in the North, Southeast, Southwest and West for the quarter ended

June 30, 2016.

Homebuilding pretax income includes depreciation and amortization expense of

$3.6

million,

$7.7

million,

$5.5

million and

$10.8

million, respectively, in the North, Southeast, Southwest and West for the

six

months ended

June 30, 2017

and

$2.7

million,

$7.0

million,

$5.9

million and

$11.8

million, respectively, in the North, Southeast, Southwest and West for the

six

months ended

June 30, 2016.

Segment financial information relating to the Company’s homebuilding assets was as follows:

	June 30,		December 31,
	2017		2016
	(Dollars in thousands)
Homebuilding assets:
North	$	1,279,502	$	1,181,544
Southeast		2,342,138		2,253,289
Southwest		1,839,474		1,842,869
West		2,537,127		2,500,163
Corporate		600,776		578,780
Total homebuilding assets	$	8,599,017	$	8,356,645

Homebuilding investments in unconsolidated joint ventures:
North	$	5,726	$	5,691
Southeast		162		334
Southwest		5,393		6,085
West		114,487		115,017
Total homebuilding investments in unconsolidated joint ventures	$	125,768	$	127,127