nvr-ex991

October 20, 2016, Reston, VA—NVR, Inc. (NYSE: NVR), one of the nation’s largest homebuilding and mortgage banking companies, announced net income for its third quarter ended September 30, 2016 of $117,392,000, or $28.46 per diluted share. Net income and diluted earnings per share for the third quarter ended September 30, 2016 increased by 1% and 5%, respectively, when compared to the third quarter of 2015. Consolidated revenues for the third quarter of 2016 totaled $1,537,569,000, a 10% increase from $1,402,351,000 for the comparable 2015 quarter.

For the nine months ended September 30, 2016, consolidated revenues were $4,069,778,000, 13% higher than the $3,603,733,000 reported for the same period of 2015. Net income for the nine months ended September 30, 2016 was $274,371,000, an increase of 10% when compared to the nine months ended September 30, 2015. Diluted earnings per share for the nine months ended September 30, 2016 was $66.24, an increase of 14% from $58.32 per diluted share for the comparable period of 2015.

New orders in the third quarter of 2016 increased 7% to 3,477 units, when compared to 3,258 units in the third quarter of 2015. The average sales price of new orders was $392,800, a 4% increase when compared with the average sales price of new orders in the third quarter of 2015. The cancellation rate in the third quarter of 2016 was 18%, compared to 17% in the third quarter of 2015. Settlements increased in the third quarter of 2016 to 3,922 units, 9% higher than the third quarter of 2015. The Company’s backlog of homes sold but not settled as of September 30, 2016 increased on a unit basis by 7% to 7,658 units and increased on a dollar basis by 10% to $2,981,894,000 when compared to September 30, 2015.

Homebuilding revenues for the three months ended September 30, 2016 totaled $1,507,451,000, 10% higher than the year earlier period. Gross profit margin decreased to 17.6% in the 2016 third quarter compared to 19.1% for the same period in 2015. Income before tax from the homebuilding segment totaled $167,657,000 in the third quarter of 2016, a 1% decrease compared to the third quarter of 2015.

Mortgage closed loan production of $1,055,163,000 for the third quarter ended September 30, 2016 increased by 11% when compared to the third quarter ended September 30, 2015. Operating income for the mortgage banking operations during the third quarter of 2016 increased 8% to $17,346,000, compared to $16,122,000 reported for the third quarter of 2015.

NVR, Inc. operates in two business segments: homebuilding and mortgage banking. The homebuilding unit sells and builds homes under the Ryan Homes, NVHomes and Heartland Homes trade names, and operates in twenty-eight metropolitan areas in fourteen states and Washington, D.C. For more information about NVR, Inc. and its brands, see www.nvrinc.com, www.ryanhomes.com, www.nvhomes.com and www.heartlandluxuryhomes.com.

Some of the statements in this release made by the Company constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as “believes,” “expects,” “may,” “will,” “should” or “anticipates” or the negative thereof or other comparable terminology. All statements other than of historical facts are forward-looking statements. Forward-looking statements contained in this document may include those regarding market trends, NVR’s financial position, business strategy, the outcome of pending litigation, investigations or similar contingencies, projected plans and objectives of management for future operations. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance of NVR to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements. Such risk factors include, but are not limited to the following: general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by NVR and NVR’s customers; increased regulation in the mortgage banking industry; the ability of our mortgage banking subsidiary to sell loans it originates into the secondary market; competition; the availability and cost of land and other raw materials used by NVR in its homebuilding operations; shortages of labor; weather related slow-downs; building moratoriums; governmental regulation; fluctuation and volatility of stock and other financial markets; mortgage financing availability; and other factors over which NVR has little or no control. NVR undertakes no obligation to update such forward-looking statements except as required by law.

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015

Homebuilding:
Revenues	$	1,507,451		$	1,374,467		$	3,990,696		$	3,537,116
Other income		703			643			2,223			2,490
Cost of sales		(1,242,292	)		(1,111,672	)		(3,294,421	)		(2,880,194	)
Selling, general and administrative		(92,867	)		(88,664	)		(290,925	)		(279,207	)
Operating income		172,995			174,774			407,573			380,205
Interest expense		(5,338	)		(5,900	)		(14,734	)		(17,499	)
Homebuilding income		167,657			168,874			392,839			362,706

Mortgage Banking:
Mortgage banking fees		30,118			27,884			79,082			66,617
Interest income		2,000			1,972			5,111			4,353
Other income		473			363			1,140			711
General and administrative		(14,959	)		(13,916	)		(44,345	)		(37,888	)
Interest expense		(286	)		(181	)		(792	)		(456	)
Mortgage banking income		17,346			16,122			40,196			33,337

Income before taxes		185,003			184,996			433,035			396,043
Income tax expense		(67,611	)		(68,526	)		(158,664	)		(147,120	)

Net income	$	117,392		$	116,470		$	274,371		$	248,923

Basic earnings per share	$	30.43		$	28.75		$	70.70		$	61.34

Diluted earnings per share	$	28.46		$	27.11		$	66.24		$	58.32

Basic weighted average shares outstanding		3,858			4,050			3,881			4,058

Diluted weighted average shares outstanding		4,125			4,296			4,142			4,268

	September 30, 2016			December 31, 2015
ASSETS
Homebuilding:
Cash and cash equivalents	$	249,728		$	397,522
Receivables		13,921			11,482
Inventory:
Lots and housing units, covered under sales agreements with customers		1,107,919			785,982
Unsold lots and housing units		134,626			147,832
Land under development		62,327			60,611
Building materials and other		11,858			12,101
		1,316,730			1,006,526

Assets related to consolidated variable interest entity		1,247			1,749
Contract land deposits, net		377,496			343,295
Property, plant and equipment, net		45,321			44,651
Reorganization value in excess of amounts allocable to identifiable assets, net		41,580			41,580
Goodwill and finite-lived intangible assets, net		2,945			3,982
Other assets		280,245			281,381
		2,329,213			2,132,168

Mortgage Banking:
Cash and cash equivalents		11,490			26,804
Mortgage loans held for sale, net		291,303			319,553
Property and equipment, net		5,085			5,313
Reorganization value in excess of amounts allocable to identifiable assets, net		7,347			7,347
Other assets		18,778			20,533
		334,003			379,550
Total assets	$	2,663,216		$	2,511,718

LIABILITIES AND SHAREHOLDERS' EQUITY
Homebuilding:
Accounts payable	$	281,530		$	227,437
Accrued expenses and other liabilities		309,939			304,922
Liabilities related to consolidated variable interest entity		877			1,091
Customer deposits		144,697			110,965
Senior notes		596,303			595,847
		1,333,346			1,240,262
Mortgage Banking:
Accounts payable and other liabilities		30,731			32,291
		30,731			32,291
Total liabilities		1,364,077			1,272,553

Commitments and contingencies

Shareholders' equity:
Common stock, $0.01 par value; 60,000,000 shares authorized; 20,555,330 shares issued as of both September 30, 2016 and December 31, 2015		206			206
Additional paid-in capital		1,499,770			1,447,795
Deferred compensation trust – 108,635 and 108,614 shares of NVR, Inc. common stock as of September 30, 2016 and December 31, 2015, respectively		(17,367	)		(17,333	)
Deferred compensation liability		17,367			17,333
Retained earnings		5,544,485			5,270,114
Less treasury stock at cost – 16,766,035 and 16,664,342 shares as of September 30, 2016 and December 31, 2015, respectively		(5,745,322	)		(5,478,950	)
Total shareholders' equity		1,299,139			1,239,165
Total liabilities and shareholders' equity	$	2,663,216		$	2,511,718

	Three Months Ended September 30,						Nine Months Ended September 30,
	2016			2015			2016			2015
Homebuilding data:
New orders (units)
Mid Atlantic (1)		1,817			1,662			6,088			5,520
North East (2)		305			304			960			936
Mid East (3)		769			730			2,829			2,686
South East (4)		586			562			2,061			1,838
Total		3,477			3,258			11,938			10,980

Average new order price	$	392.8		$	378.9		$	383.6		$	377.4

Settlements (units)
Mid Atlantic (1)		1,984			1,795			5,201			4,770
North East (2)		330			337			896			899
Mid East (3)		1,013			915			2,708			2,171
South East (4)		595			560			1,704			1,476
Total		3,922			3,607			10,509			9,316

Average settlement price	$	384.1		$	380.4		$	378.0		$	379.2

Backlog (units)
Mid Atlantic (1)								4,024			3,696
North East (2)								604			625
Mid East (3)								1,619			1,665
South East (4)								1,411			1,153
Total								7,658			7,139

Average backlog price							$	389.4		$	380.6

Community count (average)		484			469			482			473
Lots controlled at end of period								77,300			73,000

Mortgage banking data:
Loan closings	$	1,055,163		$	951,872		$	2,751,410		$	2,449,902
Capture rate		88	%		88	%		88	%		88	%

Common stock information:
Shares outstanding at end of period								3,789,295			3,982,106
Number of shares repurchased		116,318			128,097			178,306			183,128
Aggregate cost of shares repurchased	$	195,235		$	194,161		$	291,743		$	263,446


Investor Relations Contact:
Curt McKay
(703) 956-4058
ir@nvrinc.com


(1)	Maryland, Virginia, West Virginia, Delaware and Washington, D.C.
(2)	New Jersey and Eastern Pennsylvania
(3)	New York, Ohio, Western Pennsylvania, Indiana and Illinois
(4)	North Carolina, South Carolina, Tennessee and Florida