SUPPLEMENTAL GUARANTOR INFORMATION

All of the Company’s homebuilding senior notes and the homebuilding revolving credit facility are fully and unconditionally guaranteed, on a joint and several basis, by D.R. Horton, Inc. and other subsidiaries (Guarantor Subsidiaries). Each of the Guarantor Subsidiaries is 100% owned, directly or indirectly, by the Company. The Company’s subsidiaries associated with the Forestar land development operation, the financial services operations and certain other subsidiaries do not guarantee the Company’s senior notes or the revolving credit facility (collectively, Non-Guarantor Subsidiaries). In lieu of providing separate financial statements for the Guarantor Subsidiaries, consolidating condensed financial statements are presented below. Separate financial statements and other disclosures concerning the Guarantor Subsidiaries are not presented because management has determined that they are not material to investors.

The guarantees by a Guarantor Subsidiary will be automatically and unconditionally released and discharged upon: (1) the sale or other disposition of its common stock whereby it is no longer a subsidiary of the Company; (2) the sale or other disposition of all or substantially all of its assets (other than to the Company or another Guarantor); (3) its merger or consolidation with an entity other than the Company or another Guarantor; or (4) depending on the provisions of the applicable indenture, either its (a) proper designation as an unrestricted subsidiary, (b) ceasing to guarantee any of the Company’s publicly traded debt securities, or (c) ceasing to guarantee any of the Company’s obligations under the revolving credit facility.

To conform to the current year presentation, the Company’s equity in income of subsidiaries in its condensed consolidating statements of operations for the fiscal 2017 periods is presented after income tax expense. As a result, the amounts of equity in income of subsidiaries and income tax expense were each reduced by $98.6 million and $188.1 million in the three and six months ended March 31, 2017, respectively, in both the D.R. Horton, Inc. and Eliminations columns. This reclassification, which the Company determined was not material, had no impact on any financial statements or notes, except for the D.R. Horton, Inc. and Eliminations columns of the condensed consolidating statements of operations in this Supplemental Guarantor Information note. Prior period financial information will be presented similarly in the condensed consolidating statement of operations of future filings.

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Balance Sheet

March 31, 2018



	D.R. Horton, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total
	(In millions)
ASSETS
Cash and cash equivalents	$	372.1	$	114.9	$	523.8	$	—		$	1,010.8
Restricted cash	6.7		2.7		46.0		—			55.4
Investments in subsidiaries	5,753.5		—		—		(5,753.5		)	—
Inventories	3,975.9		5,850.1		320.2		(1.8		)	10,144.4
Investment in unconsolidated entities	—		—		32.1		—			32.1
Mortgage loans held for sale	—		—		658.2		—			658.2
Deferred income taxes	84.8		131.1		4.0		—			219.9
Property and equipment, net	110.8		63.7		212.5		(6.6		)	380.4
Other assets	255.0		286.4		87.7		(21.4		)	607.7
Goodwill	—		80.0		29.2		—			109.2
Intercompany receivables	778.4		—		—		(778.4		)	—
Total Assets	$	11,337.2	$	6,528.9	$	1,913.7	$	(6,561.7	)	$	13,218.1
LIABILITIES & EQUITY
Accounts payable and other liabilities	$	515.0	$	949.2	$	171.6	$	(23.5	)	$	1,612.3
Intercompany payables	—		545.2		233.2		(778.4		)	—
Notes payable	2,616.9		6.3		610.7		—			3,233.9
Total Liabilities	3,131.9		1,500.7		1,015.5		(801.9		)	4,846.2
Stockholders’ equity	8,205.3		5,028.2		725.2		(5,759.8		)	8,198.9
Noncontrolling interests	—		—		173.0		—			173.0
Total Equity	8,205.3		5,028.2		898.2		(5,759.8		)	8,371.9
Total Liabilities & Equity	$	11,337.2	$	6,528.9	$	1,913.7	$	(6,561.7	)	$	13,218.1

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Balance Sheet

September 30, 2017



	D.R. Horton, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total
	(In millions)
ASSETS
Cash and cash equivalents	$	780.9	$	154.5	$	72.4	$	—		$	1,007.8
Restricted cash	7.8		1.5		7.2		—			16.5
Investments in subsidiaries	4,812.6		—		—		(4,812.6		)	—
Inventories	3,540.4		5,579.9		116.8		—			9,237.1
Mortgage loans held for sale	—		—		587.3		—			587.3
Deferred income taxes	138.5		223.6		2.9		—			365.0
Property and equipment, net	104.8		59.7		166.3		(5.8		)	325.0
Other assets	245.5		259.7		60.7		—			565.9
Goodwill	—		80.0		—		—			80.0
Intercompany receivables	1,047.7		—		—		(1,047.7		)	—
Total Assets	$	10,678.2	$	6,358.9	$	1,013.6	$	(5,866.1	)	$	12,184.6
LIABILITIES & EQUITY
Accounts payable and other liabilities	$	483.9	$	956.9	$	126.6	$	(2.0	)	$	1,565.4
Intercompany payables	—		732.2		315.5		(1,047.7		)	—
Notes payable	2,443.4		8.2		420.0		—			2,871.6
Total Liabilities	2,927.3		1,697.3		862.1		(1,049.7		)	4,437.0
Stockholders’ equity	7,750.9		4,661.6		151.0		(4,816.4		)	7,747.1
Noncontrolling interests	—		—		0.5		—			0.5
Total Equity	7,750.9		4,661.6		151.5		(4,816.4		)	7,747.6
Total Liabilities & Equity	$	10,678.2	$	6,358.9	$	1,013.6	$	(5,866.1	)	$	12,184.6

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Operations

Three Months Ended March 31, 2018



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
Revenues	$	1,288.0		$	2,402.7		$	117.5		$	(13.5	)	$	3,794.7
Cost of sales	1,026.2			1,926.9			19.4			(10.9		)	2,961.6
Selling, general and administrative expense	156.9			164.8			79.2			—			400.9
Equity in earnings of unconsolidated entities	—			—			(0.4		)	—			(0.4		)
Gain on sale of assets	—			—			(1.1		)	—			(1.1		)
Other (income) expense	(1.7		)	(0.7		)	(8.7		)	—			(11.1		)
Income before income taxes	106.6			311.7			29.1			(2.6		)	444.8
Income tax expense	20.7			67.4			5.9			—			94.0
Equity in net income of subsidiaries, net of tax	267.5			—			—			(267.5		)	—
Net income	353.4			244.3			23.2			(270.1		)	350.8
Net loss attributable to noncontrolling interests	—			—			(0.2		)	—			(0.2		)
Net income attributable to D.R. Horton, Inc.	$	353.4		$	244.3		$	23.4		$	(270.1	)	$	351.0

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Operations

Six Months Ended March 31, 2018



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
Revenues	$	2,451.9		$	4,455.1		$	234.1		$	(13.5	)	$	7,127.6
Cost of sales	1,941.6			3,567.0			44.1			(10.9		)	5,541.8
Selling, general and administrative expense	309.1			316.4			159.6			—			785.1
Equity in earnings of unconsolidated entities	—			—			(2.7		)	—			(2.7		)
Gain on sale of assets	—			—			(14.5		)	—			(14.5		)
Other (income) expense	(2.1		)	(0.7		)	(15.4		)	—			(18.2		)
Income before income taxes	203.3			572.4			63.0			(2.6		)	836.1
Income tax expense	71.8			205.3			19.3			—			296.4
Equity in net income of subsidiaries, net of tax	410.8			—			—			(410.8		)	—
Net income	542.3			367.1			43.7			(413.4		)	539.7
Net loss attributable to noncontrolling interests	—			—			(0.6		)	—			(0.6		)
Net income attributable to D.R. Horton, Inc.	$	542.3		$	367.1		$	44.3		$	(413.4	)	$	540.3

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Operations

Three Months Ended March 31, 2017



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
Revenues	$	1,094.4		$	2,044.6		$	112.3		$	—		$	3,251.3
Cost of sales	877.9			1,647.3			24.7			—			2,549.9
Selling, general and administrative expense	143.3			149.5			62.4			—			355.2
Other (income) expense	(1.1		)	(0.9		)	(5.7		)	—			(7.7		)
Income before income taxes	74.3			248.7			30.9			—			353.9
Income tax expense	26.1			87.1			11.5			—			124.7
Equity in net income of subsidiaries, net of tax	181.0			—			—			(181.0		)	—
Net income	$	229.2		$	161.6		$	19.4		$	(181.0	)	$	229.2

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Operations

Six Months Ended March 31, 2017



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
Revenues	$	2,012.5		$	3,940.7		$	202.3		$	—		$	6,155.5
Cost of sales	1,613.3			3,172.0			32.5			—			4,817.8
Selling, general and administrative expense	267.2			292.9			120.9			—			681.0
Other (income) expense	(5.2		)	(0.9		)	(9.3		)	—			(15.4		)
Income before income taxes	137.2			476.7			58.2			—			672.1
Income tax expense	47.9			166.4			21.7			—			236.0
Equity in net income of subsidiaries, net of tax	346.8			—			—			(346.8		)	—
Net income	$	436.1		$	310.3		$	36.5		$	(346.8	)	$	436.1

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Cash Flows

Six Months Ended March 31, 2018



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
OPERATING ACTIVITIES
Net cash (used in) provided by operating activities	$	(147.3	)	$	269.9		$	(184.4	)	$	(37.0	)	$	(98.8	)
INVESTING ACTIVITIES
Expenditures for property and equipment	(21.4		)	(15.0		)	(47.6		)	5.0			(79.0		)
Proceeds from sale of assets	—			—			253.4			—			253.4
Decrease (increase) in restricted cash	1.1			(1.2		)	(38.8		)	—			(38.9		)
Investment in unconsolidated entities	—			—			(0.1		)	—			(0.1		)
Return of investment in unconsolidated entities	—			—			15.2			—			15.2
Intercompany advances	266.3			—			—			(266.3		)	—
Payments related to business acquisitions, net of cash acquired	(560.0		)	—			401.9			—			(158.1		)
Net cash (used in) provided by investing activities	(314.0		)	(16.2		)	584.0			(261.3		)	(7.5		)
FINANCING ACTIVITIES
Proceeds from notes payable	1,912.3			—			1.3			—			1,913.6
Repayment of notes payable	(1,740.2		)	(2.3		)	(10.0		)	—			(1,752.5		)
Advances on mortgage repurchase facility, net	—			—			69.8			—			69.8
Intercompany advances	—			(291.0		)	24.7			266.3			—
Proceeds from stock associated with certain employee benefit plans	32.7			—			—			—			32.7
Cash paid for shares withheld for taxes	(10.3		)	—			—			—			(10.3		)
Cash dividends paid	(94.1		)	—			(32.0		)	32.0			(94.1		)
Repurchases of common stock	(47.9		)	—			—			—			(47.9		)
Distributions to noncontrolling interests, net	—			—			(2.0		)	—			(2.0		)
Net cash provided by (used in) financing activities	52.5			(293.3		)	51.8			298.3			109.3
(Decrease) increase in cash and cash equivalents	(408.8		)	(39.6		)	451.4			—			3.0
Cash and cash equivalents at beginning of period	780.9			154.5			72.4			—			1,007.8
Cash and cash equivalents at end of period	$	372.1		$	114.9		$	523.8		$	—		$	1,010.8

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Cash Flows

Six Months Ended March 31, 2017



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
OPERATING ACTIVITIES
Net cash (used in) provided by operating activities	$	(303.6	)	$	130.3		$	87.6		$	(50.0	)	$	(135.7	)
INVESTING ACTIVITIES
Expenditures for property and equipment	(28.4		)	(11.7		)	(17.4		)	—			(57.5		)
Increase in restricted cash	(1.3		)	(0.3		)	(7.3		)	—			(8.9		)
Net principal decrease of other mortgage loans and real estate owned	—			—			1.0			—			1.0
Purchases of debt securities collateralized by residential real estate	(3.9		)	—			—			—			(3.9		)
Intercompany advances	123.8			—			—			(123.8		)	—
Payments related to business acquisitions	(4.1		)	—			—			—			(4.1		)
Net cash provided by (used in) investing activities	86.1			(12.0		)	(23.7		)	(123.8		)	(73.4		)
FINANCING ACTIVITIES
Repayment of notes payable	—			(0.5		)	—			—			(0.5		)
Payments on mortgage repurchase facility, net	—			—			(54.0		)	—			(54.0		)
Intercompany advances	—			(176.6		)	52.8			123.8			—
Proceeds from stock associated with certain employee benefit plans	24.7			—			—			—			24.7
Excess income tax benefit from employee stock awards	8.7			—			—			—			8.7
Cash paid for shares withheld for taxes	(5.1		)	—			—			—			(5.1		)
Cash dividends paid	(74.7		)	—			(50.0		)	50.0			(74.7		)
Net cash used in financing activities	(46.4		)	(177.1		)	(51.2		)	173.8			(100.9		)
(Decrease) increase in cash and cash equivalents	(263.9		)	(58.8		)	12.7			—			(310.0		)
Cash and cash equivalents at beginning of period	1,076.4			154.0			72.8			—			1,303.2
Cash and cash equivalents at end of period	$	812.5		$	95.2		$	85.5		$	—		$	993.2