Segment Information (Tables)

12 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Reporting segment results

Financial information relating to the Company’s reporting segments is as follows:

	September 30, 2020
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Assets
Cash and cash equivalents	$	2,551.1	$	394.3	$	55.6	$	17.5	$	—	$	—	$	3,018.5
Restricted cash	9.5		—		11.9		0.2		—		—		21.6
Inventories:
Construction in progress and finished homes	6,037.5		—		—		—		(53.4)		—		5,984.1
Residential land and lots — developed and under development	4,901.4		1,304.3		—		—		(34.3)		0.4		6,171.8
Land held for development	47.8		5.4		—		—		—		—		53.2
Land held for sale	28.3		—		—		—		—		—		28.3
	11,015.0		1,309.7		—		—		(87.7)		0.4		12,237.4
Mortgage loans held for sale	—		—		1,529.0		—		—		—		1,529.0
Deferred income taxes, net	142.3		—		—		—		8.4		(5.8)		144.9
Property and equipment, net	372.8		1.1		3.9		308.9		(3.0)		—		683.7
Other assets	996.4		34.8		125.8		52.8		(103.6)		7.5		1,113.7
Goodwill	134.3		—		—		—		—		29.2		163.5
	$	15,221.4	$	1,739.9	$	1,726.2	$	379.4	$	(185.9)	$	31.3	$	18,912.3
Liabilities
Accounts payable	$	859.3	$	29.2	$	—	$	12.0	$	—	$	—	$	900.5
Accrued expenses and other liabilities	1,438.3		197.8		86.8		12.2		(112.4)		(15.7)		1,607.0
Notes payable	2,514.4		641.1		1,132.6		—		(4.8)		—		4,283.3
	$	4,812.0	$	868.1	$	1,219.4	$	24.2	$	(117.2)	$	(15.7)	$	6,790.8

_____________

(1)Amounts are presented on Forestar’s historical cost basis, consistent with the manner in which management evaluates segment performance. All purchase accounting adjustments are included in the Other Adjustments column.

(2)Amounts represent the aggregate balances of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

	September 30, 2019
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Assets
Cash and cash equivalents	$	1,043.0	$	382.8	$	43.4	$	25.1	$	—	$	—	$	1,494.3
Restricted cash	8.0		—		11.6		0.1		—		—		19.7
Inventories:
Construction in progress and finished homes	5,249.0		—		—		—		(4.0)		—		5,245.0
Residential land and lots — developed and under development	4,956.1		1,011.8		—		—		(31.4)		2.9		5,939.4
Land held for development	60.7		17.1		—		—		—		—		77.8
Land held for sale	19.8		—		—		—		—		—		19.8
	10,285.6		1,028.9		—		—		(35.4)		2.9		11,282.0
Mortgage loans held for sale	—		—		1,072.0		—		—		—		1,072.0
Deferred income taxes, net	146.4		17.4		—		—		5.1		(5.8)		163.1
Property and equipment, net	272.4		2.4		3.2		221.2		—		—		499.2
Other assets	826.2		24.2		68.3		71.5		(88.5)		11.1		912.8
Goodwill	134.3		—		—		—		—		29.2		163.5
	$	12,715.9	$	1,455.7	$	1,198.5	$	317.9	$	(118.8)	$	37.4	$	15,606.6
Liabilities
Accounts payable	$	598.6	$	16.8	$	7.0	$	11.6	$	—	$	—	$	634.0
Accrued expenses and other liabilities	1,152.5		169.5		53.0		9.3		(93.6)		(12.6)		1,278.1
Notes payable	2,047.6		460.5		888.9		—		—		2.4		3,399.4
	$	3,798.7	$	646.8	$	948.9	$	20.9	$	(93.6)	$	(10.2)	$	5,311.5

______________

(1)Amounts are presented on Forestar’s historical cost basis, consistent with the manner in which management evaluates segment performance. All purchase accounting adjustments are included in the Other Adjustments column.

(2)Amounts represent the aggregate balances of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

	Year Ended September 30, 2020
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Revenues
Home sales	$	19,560.8	$	—	$	—	$	—	$	—	$	—	$	19,560.8
Land/lot sales and other	83.1		931.8		—		37.9		(887.4)		—		165.4
Financial services	—		—		584.9		—		—		—		584.9
	19,643.9		931.8		584.9		37.9		(887.4)		—		20,311.1
Cost of sales
Home sales (5)	15,305.8		—		—		—		(58.6)		—		15,247.2
Land/lot sales and other	58.3		812.8		—		—		(769.0)		0.1		102.2
Inventory and land option charges	22.9		0.9		—		—		—		—		23.8
	15,387.0		813.7		—		—		(827.6)		0.1		15,373.2
Selling, general and administrative expense	1,603.6		45.7		364.7		33.3		—		0.5		2,047.8
Equity in earnings of unconsolidated entities	—		(0.7)		—		—		—		—		(0.7)
Gain on sale of assets	—		(0.1)		—		(59.4)		—		—		(59.5)
Other (income) expense	(11.7)		(4.9)		(25.0)		8.9		—		—		(32.7)
Income before income taxes	$	2,665.0	$	78.1	$	245.2	$	55.1	$	(59.8)	$	(0.6)	$	2,983.0
Summary Cash Flow Information
Depreciation and amortization	$	68.2	$	0.3	$	1.6	$	9.8	$	—	$	0.5	$	80.4
Cash provided by (used in) operating activities	$	1,904.2	$	(168.5)	$	(292.8)	$	(4.5)	$	(16.8)	$	—	$	1,421.6

_____________

(1)Results are presented on Forestar’s historical cost basis, consistent with the manner in which management evaluates segment performance. All purchase accounting adjustments are included in the Other Adjustments column.

(2)Amounts represent the aggregate results of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

(5)Amount in the Eliminations column represents the profit on lots sold from Forestar to the homebuilding segment. Intercompany profit is eliminated in the consolidated financial statements when Forestar sells lots to the homebuilding segment and is recognized in the consolidated financial statements when the homebuilding segment closes homes on the lots to homebuyers.

	Year Ended September 30, 2019
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Revenues
Home sales	$	16,925.0	$	—	$	—	$	—	$	—	$	—	$	16,925.0
Land/lot sales and other	91.9		428.3		—		32.6		(326.6)		—		226.2
Financial services	—		—		441.7		—		—		—		441.7
	17,016.9		428.3		441.7		32.6		(326.6)		—		17,592.9
Cost of sales
Home sales (5)	13,507.1		—		—		—		(8.3)		—		13,498.8
Land/lot sales and other	75.1		361.9		—		—		(287.4)		18.5		168.1
Inventory and land option charges	53.2		0.8		—		—		—		—		54.0
	13,635.4		362.7		—		—		(295.7)		18.5		13,720.9
Selling, general and administrative expense	1,482.3		28.9		293.0		27.8		—		0.5		1,832.5
Equity in earnings of unconsolidated entities	—		(0.5)		—		—		—		—		(0.5)
Gain on sale of assets	(2.0)		(3.0)		—		(51.9)		—		3.0		(53.9)
Other (income) expense	(9.5)		(5.5)		(17.6)		1.2		—		—		(31.4)
Income before income taxes	$	1,910.7	$	45.7	$	166.3	$	55.5	$	(30.9)	$	(22.0)	$	2,125.3
Summary Cash Flow Information
Depreciation and amortization	$	63.7	$	0.2	$	1.5	$	6.1	$	—	$	0.5	$	72.0
Cash provided by (used in) operating activities	$	1,438.0	$	(391.3)	$	(150.2)	$	2.5	$	(2.5)	$	(4.4)	$	892.1

_____________

(1)Results are presented on Forestar’s historical cost basis, consistent with the manner in which management evaluates segment performance. All purchase accounting adjustments are included in the Other Adjustments column.

(2)Amounts represent the aggregate results of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

(5)Amount in the Eliminations column represents the profit on lots sold from Forestar to the homebuilding segment. Intercompany profit is eliminated in the consolidated financial statements when Forestar sells lots to the homebuilding segment and is recognized in the consolidated financial statements when the homebuilding segment closes homes on the lots to homebuyers.

	Year Ended September 30, 2018
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Revenues
Home sales	$	15,502.0	$	—	$	—	$	—	$	—	$	—	$	15,502.0
Land/lot sales and other	121.8		109.2		—		—		(39.1)		(1.2)		190.7
Financial services	—		—		375.3		—		—		—		375.3
	15,623.8		109.2		375.3		—		(39.1)		(1.2)		16,068.0
Cost of sales
Home sales (5)	12,195.5		—		—		—		(1.2)		—		12,194.3
Land/lot sales and other	99.1		68.0		—		—		(30.1)		16.4		153.4
Inventory and land option charges	48.8		1.0		—		—		—		0.6		50.4
	12,343.4		69.0		—		—		(31.3)		17.0		12,398.1
Selling, general and administrative expense	1,346.2		32.8		272.6		24.7		—		0.5		1,676.8
Equity in earnings of unconsolidated entities	—		(12.4)		—		—		2.5		7.1		(2.8)
Gain on sale of assets	(15.8)		(27.7)		—		—		—		24.7		(18.8)
Interest expense	—		5.8		—		—		(5.8)		—		—
Other (income) expense	(7.2)		(7.0)		(15.1)		(17.0)		—		1.0		(45.3)
Income (loss) before income taxes	$	1,957.2	$	48.7	$	117.8	$	(7.7)	$	(4.5)	$	(51.5)	$	2,060.0
Summary Cash Flow Information
Depreciation and amortization	$	53.4	$	0.3	$	1.4	$	6.8	$	—	$	0.5	$	62.4
Cash provided by (used in) operating activities	$	1,001.7	$	(320.3)	$	(116.6)	$	0.8	$	(10.5)	$	(9.9)	$	545.2

______________

(1)Results are presented from the date of acquisition and on Forestar’s historical cost basis, consistent with the manner in which management evaluates segment performance. All purchase accounting adjustments are included in the Other Adjustments column.

(2)Amounts represent the aggregate results of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions and the reclassification of Forestar interest expense to inventory.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

(5)Amount in the Eliminations column represents the profit on lots sold from Forestar to the homebuilding segment. Intercompany profit is eliminated in the consolidated financial statements when Forestar sells lots to the homebuilding segment and is recognized in the consolidated financial statements when the homebuilding segment closes homes on the lots to homebuyers.

Homebuilding Inventories by Reporting Segment (1)	September 30,
	2020		2019
	(In millions)
East	$	1,328.3	$	1,288.8
Midwest	958.5		836.8
Southeast	2,919.9		2,768.0
South Central	2,879.9		2,533.2
Southwest	695.8		574.4
West	2,009.1		2,056.0
Corporate and unallocated (2)	223.5		228.4
	$	11,015.0	$	10,285.6

________________________

(1)Homebuilding inventories are the only assets included in the measure of homebuilding segment assets used by the Company’s chief operating decision makers.

(2)Corporate and unallocated consists primarily of capitalized interest and property taxes.

Homebuilding Results by Reporting Segment	Year Ended September 30,
	2020		2019		2018
	(In millions)
Revenues
East	$	2,642.3	$	2,290.2	$	1,893.4
Midwest	1,429.0		1,123.1		858.9
Southeast	5,845.2		4,977.8		4,578.6
South Central	4,998.1		4,202.4		3,769.9
Southwest	881.6		772.6		768.7
West	3,847.7		3,650.8		3,754.3
	$	19,643.9	$	17,016.9	$	15,623.8
Inventory and Land Option Charges
East	$	1.8	$	2.7	$	2.3
Midwest	2.2		3.5		5.1
Southeast	7.8		10.7		28.8
South Central	6.7		11.6		4.6
Southwest	0.1		0.5		0.9
West	4.3		24.2		7.1
	$	22.9	$	53.2	$	48.8
Income Before Income Taxes (1)
East	$	357.0	$	238.8	$	217.3
Midwest	128.8		57.7		77.5
Southeast	841.0		584.7		536.0
South Central	758.0		551.1		506.1
Southwest	136.9		100.4		97.4
West	443.3		378.0		522.9
	$	2,665.0	$	1,910.7	$	1,957.2

________________________

(1)Expenses maintained at the corporate level consist primarily of interest and property taxes, which are capitalized and amortized to cost of sales or expensed directly, and the expenses related to operating the Company’s corporate office. The amortization of capitalized interest and property taxes is allocated to each homebuilding segment based on the segment’s cost of sales, while expenses associated with the corporate office are allocated to each homebuilding segment based on the segment’s inventory balances.