EX-99.1 2 exhibit991-123112.htm EXHIBIT 99.1 EARNINGS Exhibit 99.1 - 12.31.12


  
Exhibit 99.1
PRESS RELEASE

Beazer Homes Reports First Quarter Fiscal 2013 Results

ATLANTA, January 28, 2013 - Beazer Homes USA, Inc. (NYSE: BZH) (www.beazer.com) today announced its financial results for the quarter ended December 31, 2012.

“In the first quarter we achieved improvements in nearly every operational and financial metric compared to last year, including new orders, closings and adjusted EBITDA,” said Allan Merrill, President and CEO of Beazer Homes. “Additionally we saw higher home sales prices and lower cancellation rates as most of our geographic markets continued to demonstrate signs of improvement. We remain committed to our path-to-profitability strategies, which are designed to enable us to return to sustained profitability as soon as possible.”

On trends in the housing market, Mr. Merrill commented, “While there are still challenges to overcome before the
industry can achieve a full turnaround, we believe that improvements in consumer confidence coupled with low
mortgage rates and enhanced clarity regarding mortgage qualification procedures should provide support for both
increased demand for new homes and improved new home pricing during the balance of the year.”

Summary results for the quarter ended December 31, 2012 are as follows (all per share amounts are calculated after giving effect to a 1-for-5 reverse stock split completed on October 12, 2012):

Q1 Results from Continuing Operations (unless otherwise specified)
 
 
Quarter Ended December 31,
 
 
2012
 
2011
 
Change
New Home Orders
 
932

 
724

 
28.7
%
LTM orders per month per community
 
2.5

 
1.9

 
31.6
%
Cancellation rates
 
26.4
%
 
35.1
%
 
-730 bps

 
 
 
 
 
 
 
Total Home Closings
 
1,038

 
867

 
19.7
%
Average sales price from closings (in thousands)
 
$
235.5

 
$
215.5

 
9.3
%
Homebuilding revenue (in millions)
 
$
244.4

 
$
186.9

 
30.8
%
Homebuilding gross profit margin, excluding impairments and abandonments (I&A) (a)
 
14.7
%
 
13.3
%
 
140 bps

Homebuilding gross profit margin, excluding I&A and interest amortized to cost of sales (a)
 
18.1
%
 
20.2
%
 
-210 bps

 
 
 
 
 
 
 
Loss from continuing operations before income taxes (in millions)
 
$
(19.2
)
 
$
(35.0
)
 
$
15.8

Net (loss) income from continuing operations (in millions)
 
$
(18.9
)
 
$
0.7

 
$
(19.6
)
Basic Per Share
 
$
(0.78
)
 
$
0.05

 
$
(0.83
)
Inventory impairments (in millions)
 
$
(0.2
)
 
$
(3.5
)
 
$
3.3

Net (loss) income from continuing operations excluding inventory impairments (in millions)
 
$
(18.7
)
 
$
4.2

 
$
(22.9
)
Land and land development spending (in millions)
 
$
90.0

 
$
58.2

 
$
31.8

Adjusted EBITDA (in millions)
 
$
7.7

 
$
3.8

 
$
3.9


(a) Homebuilding gross profit for the quarter ended December 31, 2011 includes an $11.0 million warranty recovery which contributed 590 bps to the margin







As of December 31, 2012

•
Total cash and cash equivalents: $648.2 million, including unrestricted cash of approximately $396.7 million
•
Stockholders' equity: $242.6 million, not including $9.4 million of mandatory convertible subordinated notes, which converted to 408,790 shares of common stock at maturity on January 15, 2013
•
Total backlog from continuing operations: 1,817 homes with a sales value of $478.3 million, compared to 1,307 homes with a sales value of $315.8 million as of December 31, 2011
•
Land and lots controlled: 25,104 lots (82.0% owned), a decrease of 3.4% from December 31, 2011


Conference Call

The Company will hold a conference call on January 31, 2013 at 9:30 am EST to discuss these results. Interested parties may listen to the conference call and view the Company's slide presentation over the internet by visiting the “Investor Relations” section of the Company's website at www.beazer.com. To access the conference call by telephone, listeners should dial 800-619-8639 or 312-470-7002. To be admitted to the call, verbally supply the passcode "BZH". A replay of the call will be available shortly after the conclusion of the live call. To access the replay, dial 866-429-0570 or 203-369-0912 and enter the passcode “3740” (available until 9:30 pm ET on February 7, 2013), or visit www.beazer.com. A replay of the webcast will be available at www.beazer.com for approximately 30 days.

Headquartered in Atlanta, Beazer Homes is one of the country's 10 largest single-family homebuilders. The Company's homes meet or exceed the benchmark for energy-efficient home construction as established by ENERGY STAR® and are designed with flexible floorplan options to meet the personal preferences and lifestyles of its buyers. In addition, the Company is committed to providing a range of preferred lender choices to facilitate transparent competition between lenders and enhanced customer service. The Company offers homes in 16 states, including Arizona, California, Delaware, Florida, Georgia, Indiana, Maryland, Nevada, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Tennessee, Texas and Virginia. Beazer Homes is listed on the New York Stock Exchange under the ticker symbol “BZH.” For more info visit Beazer.com, or check out Beazer on Facebook and Twitter.

This press release contains forward-looking statements. These forward-looking statements represent our expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of our control, that could cause actual results to differ materially from the results discussed in the forward-looking statements, including, among other things, (i) economic changes nationally or in local markets, including changes in consumer confidence, changes in the level of housing starts, declines in employment levels, inflation and changes in the demand and prices of new homes and resale homes in the market; (ii) a slower economic rebound than anticipated, coupled with persistently high unemployment and additional foreclosures; (iii) estimates related to homes to be delivered in the future (backlog) are imprecise as they are subject to various cancellation risks which cannot be fully controlled; (iv) a substantial increase in mortgage interest rates, increased disruption in the availability of mortgage financing or a change in tax laws regarding the deductibility of mortgage interest; (v) factors affecting margins such as decreased land values underlying lot option agreements, increased land development costs on communities under development or delays or difficulties in implementing initiatives to reduce production and overhead cost structure; (vi) the final outcome of various putative class action lawsuits, multi-party suits and similar proceedings as well as the results of any other litigation or government proceedings and fulfillment of the obligations in the Deferred Prosecution Agreement and consent orders with governmental authorities and other settlement agreements; (vii) our cost of and ability to access capital and otherwise meet our ongoing liquidity needs including the impact of any downgrades of our credit ratings or reductions in our tangible net worth or liquidity levels; (viii) our ability to comply with covenants in our debt agreements or satisfy such obligations through repayment or refinancing; (ix) estimates related to the potential recoverability of our deferred tax assets; (x) increased competition or delays in reacting to changing consumer preference in home design; (xi) shortages of or increased prices for labor, land or raw materials used in housing production; (xii) additional asset impairment charges or writedowns; (xiii) the impact of construction defect and home warranty claims; (xiv)the cost and availability of insurance and surety bonds; (xv) delays in land development or home construction resulting from adverse weather conditions; (xvi) potential delays or increased costs




in obtaining necessary permits and possible penalties for failure to comply with laws, regulations and governmental policies; (xvii) the performance of our joint ventures and our joint venture partners; (xviii) potential exposure related to additional repurchase claims on mortgages and loans originated by Beazer Mortgage Corp.; (xix) effects of changes in accounting policies, standards, guidelines or principles; or (xx) terrorist acts, acts of war and other factors over which the Company has little or no control. Any forward-looking statement speaks only as of the date on which such statement is made, and, except as required by law, we do not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time and it is not possible for management to predict all such factors.



CONTACT: Beazer Homes USA, Inc.
Carey Phelps
Director, Investor Relations & Corporate Communications
770-829-3700
investor.relations@beazer.com


-Tables Follow-




                    





BEAZER HOMES USA, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
 
Three Months Ended
 
December 31,
 
2012
 
2011
Total revenue
$
246,902

 
$
188,548

Home construction and land sales expenses
210,614

 
162,776

Inventory impairments and option contract abandonments
204

 
3,503

Gross profit
36,084

 
22,269

Commissions
10,642

 
8,371

General and administrative expenses
26,328

 
28,194

Depreciation and amortization
2,715

 
2,403

Operating loss
(3,601
)
 
(16,699
)
Equity in income (loss) of unconsolidated entities
36

 
(77
)
Other expense, net
(15,627
)
 
(18,273
)
Loss from continuing operations before income taxes
(19,192
)
 
(35,049
)
Benefit from income taxes
(253
)
 
(35,747
)
(Loss) income from continuing operations
(18,939
)
 
698

(Loss) income from discontinued operations, net of tax
(1,449
)
 
41

Net (loss) income
$
(20,388
)
 
$
739

Weighted average number of shares:
 
 
 
Basic
24,294

 
14,833

Diluted
24,294

 
17,421

(Loss) earnings per share:
 
 
 
Basic (loss) earnings per share from continuing operations
$
(0.78
)
 
$
0.05

Basic (loss) earnings per share from discontinued operations
$
(0.06
)
 
$
—

Basic (loss) earnings per share
$
(0.84
)
 
$
0.05

Diluted (loss) earnings per share from continuing operations
$
(0.78
)
 
$
0.04

Diluted (loss) earnings per share from discontinued operations
$
(0.06
)
 
$
—

Diluted (loss) earnings per share
$
(0.84
)
 
$
0.04


 
 
Three Months Ended
 
December 31,
 
2012
 
2011
Capitalized interest in inventory, beginning of period
$
38,190

 
$
45,973

Interest incurred
28,418

 
32,525

Capitalized interest impaired
—

 
(28
)
Interest expense not qualified for capitalization and included as other expense
(16,211
)
 
(19,117
)
Capitalized interest amortized to house construction and land sales expenses
(8,475
)
 
(12,843
)
Capitalized interest in inventory, end of period
$
41,922

 
$
46,510






BEAZER HOMES USA, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
 
 
December 31, 2012
 
September 30, 2012
ASSETS
 
 
 
 
Cash and cash equivalents
 
$
396,696

 
$
487,795

Restricted cash
 
251,455

 
253,260

Accounts receivable (net of allowance of $2,184 and $2,235, respectively)
 
23,484

 
24,599

Income tax receivable
 
2,513

 
6,372

Inventory
 
 
 
 
Owned inventory
 
1,141,691

 
1,099,132

Land not owned under option agreements
 
9,205

 
12,420

Total inventory
 
1,150,896

 
1,111,552

Investments in unconsolidated entities
 
42,029

 
42,078

Deferred tax assets, net
 
6,924

 
6,848

Property, plant and equipment, net
 
18,054

 
18,974

Other assets
 
29,473

 
30,740

Total assets
 
$
1,921,524

 
$
1,982,218

 
 
 
 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
 
Trade accounts payable
 
$
56,062

 
$
69,268

Other liabilities
 
122,269

 
147,718

Obligations related to land not owned under option agreements
 
3,625

 
4,787

Total debt (net of discounts of $2,944 and $3,082, respectively)
 
1,496,951

 
1,498,198

Total liabilities
 
$
1,678,907

 
$
1,719,971

 
 
 
 
 
Stockholders’ equity:
 
 
 
 
Preferred stock (par value $.01 per share, 5,000,000 shares authorized, no shares issued)
 
$
—

 
$
—

Common stock (par value $0.001 per share, 100,000,000 shares authorized, 24,690,033 and 24,601,830 issued and outstanding, respectively)
 
25

 
25

Paid-in capital
 
834,752

 
833,994

Accumulated deficit
 
(592,160
)
 
(571,772
)
Total stockholders’ equity
 
242,617

 
262,247

Total liabilities and stockholders’ equity
 
$
1,921,524

 
$
1,982,218

 
 
 
 
 
Inventory Breakdown
 
 
 
 
Homes under construction
 
$
261,062

 
$
251,828

Development projects in progress
 
422,262

 
391,019

Land held for future development
 
367,245

 
367,102

Land held for sale
 
8,576

 
10,149

Capitalized interest
 
41,922

 
38,190

Model homes
 
40,624

 
40,844

Land not owned under option agreements
 
9,205

 
12,420

Total inventory
 
$
1,150,896

 
$
1,111,552




 




BEAZER HOMES USA, INC.
CONSOLIDATED OPERATING AND FINANCIAL DATA – CONTINUING OPERATIONS
 
 
Quarter Ended December 31,
SELECTED OPERATING DATA
 
2012
 
2011
Closings:
 
 
 
 
West region
 
499

 
370

East region
 
353

 
310

Southeast region
 
186

 
187

Total closings
 
1,038

 
867

 
 
 
 
 
New orders, net of cancellations:
 
 
 
 
West region
 
424

 
303

East region
 
309

 
249

Southeast region
 
199

 
172

Total new orders
 
932

 
724

 
 
 
 
 
Backlog units at end of period:
 
 
 
 
West region
 
764

 
503

East region
 
703

 
577

Southeast region
 
350

 
227

Total backlog units
 
1,817

 
1,307

 
 
 
 
 
Dollar value of backlog at end of period (in millions)
 
$
478.3

 
$
315.8

 
 
 
 
 
Homebuilding Revenue (in thousands):
 
 
 
 
West region
 
$
109,753

 
$
70,254

East region
 
96,464

 
81,767

Southeast region
 
38,208

 
34,831

Total homebuilding revenue
 
$
244,425

 
$
186,852


 
 
Quarter Ended December 31,
SUPPLEMENTAL FINANCIAL DATA
 
2012
 
2011
Revenues:
 
 
 
 
Homebuilding
 
$
244,425

 
$
186,852

Land sales and other
 
2,477

 
1,696

Total
 
$
246,902

 
$
188,548

 
 
 
 
 
Gross profit:
 
 
 
 
Homebuilding
 
$
35,630

 
$
21,352

Land sales and other
 
454

 
917

Total
 
$
36,084

 
$
22,269





Reconciliation of homebuilding gross profit before impairments and abandonments and interest amortized to cost of sales and the related gross margins to homebuilding gross profit and gross margin, the most directly comparable GAAP measure, is provided for each period discussed below. Management believes that this information assists investors in comparing the operating characteristics of homebuilding activities by eliminating many of the differences in companies' respective level of impairments and level of debt. Homebuilding gross profit for the quarter ended December 31, 2011 included a $11.0 million warranty recovery which added 590 basis points to homebuilding gross profit before I&A and interest amortized to cost of sales.
 
Quarter Ended December 31,
 
2012
 
2011
Homebuilding gross profit
$
35,630

14.6
%
 
$
21,352

11.4
%
Inventory impairments and lot option abandonments (I&A)
204

 
 
3,503

 
Homebuilding gross profit before I&A
35,834

14.7
%
 
24,855

13.3
%
Interest amortized to cost of sales
8,475

 
 
12,843

 
Homebuilding gross profit before I&A and interest amortized to cost of sales
$
44,309

18.1
%
 
$
37,698

20.2
%

Reconciliation of Adjusted EBITDA (earnings before interest, taxes, depreciation, amortization and impairments) to total company net income (loss) (including discontinued operations), the most directly comparable GAAP measure, is provided for each period discussed below. Management believes that Adjusted EBITDA assists investors in understanding and comparing the operating characteristics of homebuilding activities by eliminating many of the differences in companies' respective capitalization, tax position and level of impairments.  
 
 
Quarter Ended December 31,
 
 
2012
 
2011
Net (loss) income
 
$
(20,388
)
 
$
739

Benefit from income taxes
 
(275
)
 
(36,146
)
Interest amortized to home construction and land sales expenses, capitalized interest impaired, and interest expense not qualified for capitalization
 
24,686

 
31,988

Depreciation and amortization and stock compensation amortization
 
3,499

 
3,703

Inventory impairments and option contract abandonments
 
221

 
3,507

Joint venture impairment and abandonment charges
 
—

 
29

Adjusted EBITDA
 
$
7,743

 
$
3,820