Dream Finders Announces Fourth Quarter and Full Year 2024 Results
Company Record Homebuilding Revenues of
Net Income Up
Return on Participating Equity of
Fourth Quarter 2024 Highlights (As Compared to Fourth Quarter 2023)
-
Homebuilding revenues increased
35% to$1.5 billion $1.1 billion -
Home closings increased
40% to 3,008 from 2,153 -
Net new orders increased
46% to 1,611 from 1,106 -
Homebuilding gross margin of
17.7% compared to20.5% -
Adjusted homebuilding gross margin (non-GAAP) of
26.9% compared to28.1% -
Pre-tax income increased
24% to$169 million $135 million -
Net income attributable to DFH increased
27% to$129 million $1.35 $102 million $1.06 -
Financial services pre-tax income increased
94% to$11 million $6 million
Full Year 2024 Highlights (As Compared to Full Year 2023, Unless Otherwise Noted)
-
Homebuilding revenues increased
18% to$4.4 billion $3.7 billion -
Home closings increased
17% to 8,583 from 7,314 -
Net new orders increased
17% to 6,727 from 5,744 -
Homebuilding gross margin of
18.3% compared to19.4% -
Adjusted homebuilding gross margin (non-GAAP) of
27.0% compared to27.2% -
Pre-tax income increased
8% to$438 million $404 million -
Net income attributable to DFH increased
13% to$335 million $3.44 $296 million $3.03 -
Financial services pre-tax income increased
62% to$32 million $20 million - Controlled lot pipeline of 54,698 as of December 31, 2024 compared to 29,748 as of December 31, 2023
-
Total liquidity of
$816 million -
Net homebuilding debt to net capitalization (non-GAAP) of
33.7% as of December 31, 2024 compared to23.3% as of December 31, 2023 -
Return on participating equity of
29.7% compared to36.3% -
Repurchased 291,229 Class A common shares for
$8 million
Management Commentary
Patrick Zalupski, Dream Finders Homes Chairman and CEO, said, “In 2024, we were pleased to achieve another year of growth. We ended on a high note — our fourth quarter was by far the best quarter of the year, and, arguably, the best in Company history. The team worked hard to produce outstanding results and to position us for another year of growth in 2025. Highlighting fourth quarter key metrics: we closed 3,008 homes, up
From an annual perspective, the team delivered another really solid year. All of the following results are absolute Company records. Annual closings were up
We had an active year on the M&A front, completing acquisitions of Crescent Homes and Jet HomeLoans, while also announcing definitive purchase agreements of Liberty Communities (closed in January 2025) and Alliant Title Insurance (currently pending regulatory approval). We believe all four of these acquisitions are highly accretive and will contribute materially to DFH's future earnings growth.
While we are gratified regarding our results from the quarter and 2024 year, we want to be quick to acknowledge these achievements and shift our focus to 2025. We are always oriented toward the future and continuing to grow our earnings and produce above-average shareholder returns. We have set the foundation to continue to scale, drive sustainable growth and generate long-term value. We initiate our 2025 full year guidance of approximately 9,250 expected home closings.”
Fourth Quarter 2024 Results
Homebuilding revenues in the fourth quarter of 2024 increased
Homebuilding gross margin percentage in the fourth quarter of 2024 was
Adjusted homebuilding gross margin in the fourth quarter of 2024 was
Selling, general and administrative expense (“SG&A”) in the fourth quarter of 2024 increased
Consolidated net income attributable to DFH in the fourth quarter of 2024 increased
Net new orders in the fourth quarter of 2024 were 1,611, an increase of
Our total available liquidity as of December 31, 2024 was
Fourth Quarter 2024 Backlog
As of December 31, 2024, DFH had a backlog of 2,599 homes, valued at
The following table shows the backlog units and ASP as of December 31, 2024 by homebuilding segment:
|
As of December 31, 2024 (unaudited) |
|||
Backlog: |
Units |
|
Average Sales Price |
|
Southeast |
1,150 |
|
$ |
406,246 |
Mid-Atlantic |
678 |
|
|
464,798 |
Midwest |
771 |
|
|
677,234 |
Total |
2,599 |
|
$ |
501,910 |
Subsequent Events
Liberty Communities Acquisition
On January 23, 2025, DFH acquired the majority of the homebuilding assets of privately held homebuilder, Liberty Communities, LLC (“Liberty Communities” or “Liberty”). The consideration given for the Liberty Communities acquisition was cash in the amount of
Full Year 2025 Outlook
Dream Finders Homes expects approximately 9,250 home closings for the full year 2025, inclusive of those from the Liberty Communities acquisition.
About Dream Finders Homes, Inc.
Dream Finders Homes (NYSE: DFH) is a homebuilder based in
Forward-Looking Statements
This press release includes forward-looking statements regarding future events which include, but are not limited to, projected 2025 home closings and market conditions, possible or assumed future results of operations, benefits of the Liberty Communities and Alliant acquisitions and statements regarding the Company’s strategies and expectations as they relate to market opportunities and growth. All forward-looking statements are based on Dream Finders Homes’ beliefs as well as assumptions made by and information currently available to Dream Finders Homes. These statements reflect Dream Finders Homes’ current views with respect to future events and are subject to various risks, uncertainties and assumptions. These risks, uncertainties and assumptions are discussed in Dream Finders Homes’ Annual Report on Form 10-K for the year ended December 31, 2024 and other filings with the
Dream Finders Homes, Inc. |
|||||||
Consolidated Balance Sheets |
|||||||
(In thousands, except share and per share amounts) |
|||||||
|
December 31,
|
|
December 31,
|
||||
Assets |
|
|
|
||||
Cash and cash equivalents |
$ |
274,384 |
|
|
$ |
494,145 |
|
Restricted cash |
|
65,441 |
|
|
|
54,311 |
|
Accounts receivable |
|
34,126 |
|
|
|
30,874 |
|
Inventories |
|
1,715,357 |
|
|
|
1,440,249 |
|
Lot deposits |
|
458,303 |
|
|
|
247,207 |
|
Other assets |
|
122,391 |
|
|
|
80,759 |
|
Investments in unconsolidated entities |
|
11,454 |
|
|
|
15,364 |
|
Mortgage loans held for sale |
|
303,393 |
|
|
|
— |
|
Property and equipment, net |
|
26,317 |
|
|
|
7,043 |
|
Right-of-use assets |
|
17,172 |
|
|
|
20,280 |
|
Goodwill |
|
300,313 |
|
|
|
172,207 |
|
Total assets |
$ |
3,328,651 |
|
|
$ |
2,562,439 |
|
|
|
|
|
||||
Liabilities |
|
|
|
||||
Accounts payable |
$ |
147,143 |
|
|
$ |
134,115 |
|
Accrued expenses |
|
263,317 |
|
|
|
207,389 |
|
Customer deposits |
|
125,601 |
|
|
|
172,574 |
|
Construction lines of credit |
|
701,386 |
|
|
|
530,384 |
|
Senior unsecured notes, net |
|
295,049 |
|
|
|
293,918 |
|
Mortgage warehouse facilities |
|
289,617 |
|
|
|
— |
|
Lease liabilities |
|
18,148 |
|
|
|
21,114 |
|
Contingent consideration |
|
68,030 |
|
|
|
116,795 |
|
Total liabilities |
|
1,908,291 |
|
|
|
1,476,289 |
|
|
|
|
|
||||
Mezzanine Equity |
|
|
|
||||
Redeemable preferred stock |
|
148,500 |
|
|
|
148,500 |
|
Redeemable noncontrolling interest |
|
21,451 |
|
|
|
— |
|
Equity |
|
|
|
||||
Class A common stock, |
|
360 |
|
|
|
329 |
|
Class B common stock, |
|
577 |
|
|
|
602 |
|
Additional paid-in capital |
|
281,559 |
|
|
|
275,241 |
|
Retained earnings |
|
970,253 |
|
|
|
648,412 |
|
Treasury stock, at cost, 291,229 shares and no shares of Class A common stock as of December 31, 2024 and 2023, respectively |
|
(7,827 |
) |
|
|
— |
|
Total Dream Finders Homes, Inc. stockholders’ equity |
|
1,244,922 |
|
|
|
924,584 |
|
Noncontrolling interests |
|
5,487 |
|
|
|
13,066 |
|
Total equity |
|
1,250,409 |
|
|
|
937,650 |
|
Total liabilities, mezzanine equity and equity |
$ |
3,328,651 |
|
|
$ |
2,562,439 |
|
Dream Finders Homes, Inc. |
||||||||||||||||
Consolidated Statements of Comprehensive Income |
||||||||||||||||
(In thousands, except share and per share amounts) |
||||||||||||||||
|
|
Three Months Ended December 31, (unaudited) |
|
Year Ended December 31, |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Revenues: |
|
|
|
|
|
|
|
|
||||||||
Homebuilding |
|
$ |
1,534,163 |
|
|
$ |
1,135,030 |
|
|
$ |
4,397,877 |
|
|
$ |
3,738,888 |
|
Financial services |
|
|
26,589 |
|
|
|
2,967 |
|
|
|
53,729 |
|
|
|
9,698 |
|
Total revenues |
|
|
1,560,752 |
|
|
|
1,137,997 |
|
|
|
4,451,606 |
|
|
|
3,748,586 |
|
Homebuilding cost of sales |
|
|
1,262,896 |
|
|
|
902,328 |
|
|
|
3,591,483 |
|
|
|
3,011,813 |
|
Financial services expense |
|
|
15,286 |
|
|
|
1,842 |
|
|
|
31,540 |
|
|
|
5,727 |
|
Selling, general and administrative expense |
|
|
116,806 |
|
|
|
92,520 |
|
|
|
395,751 |
|
|
|
303,068 |
|
Income from unconsolidated entities |
|
|
(266 |
) |
|
|
(5,856 |
) |
|
|
(10,567 |
) |
|
|
(18,075 |
) |
Contingent consideration revaluation |
|
|
146 |
|
|
|
13,982 |
|
|
|
13,939 |
|
|
|
46,590 |
|
Other income, net |
|
|
(2,714 |
) |
|
|
(2,251 |
) |
|
|
(8,394 |
) |
|
|
(4,962 |
) |
Income before taxes |
|
|
168,598 |
|
|
|
135,432 |
|
|
|
437,854 |
|
|
|
404,425 |
|
Income tax expense |
|
|
(38,106 |
) |
|
|
(30,483 |
) |
|
|
(97,272 |
) |
|
|
(96,483 |
) |
Net and comprehensive income |
|
|
130,492 |
|
|
|
104,949 |
|
|
|
340,582 |
|
|
|
307,942 |
|
Net and comprehensive income attributable to noncontrolling interests |
|
|
(1,239 |
) |
|
|
(2,999 |
) |
|
|
(5,241 |
) |
|
|
(12,042 |
) |
Net and comprehensive income attributable to Dream Finders Homes, Inc. |
|
$ |
129,253 |
|
|
$ |
101,950 |
|
|
$ |
335,341 |
|
|
$ |
295,900 |
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
$ |
1.35 |
|
|
$ |
1.06 |
|
|
$ |
3.44 |
|
|
$ |
3.03 |
|
Diluted |
|
$ |
1.29 |
|
|
$ |
1.00 |
|
|
$ |
3.34 |
|
|
$ |
2.79 |
|
Weighted-average number of shares |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
|
93,455,979 |
|
|
|
93,108,277 |
|
|
|
93,507,905 |
|
|
|
93,066,564 |
|
Diluted |
|
|
100,391,557 |
|
|
|
102,029,755 |
|
|
|
100,297,139 |
|
|
|
106,027,548 |
|
Dream Finders Homes, Inc. |
||||||||||||||||
Other Financial and Operating Data |
||||||||||||||||
(Unaudited) |
||||||||||||||||
|
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Other Financial and Operating Data |
|
|
|
|
|
|
|
|
||||||||
Home closings |
|
|
3,008 |
|
|
|
2,153 |
|
|
|
8,583 |
|
|
|
7,314 |
|
Average sales price of homes closed(1) |
|
$ |
507,477 |
|
|
$ |
520,940 |
|
|
$ |
509,249 |
|
|
$ |
505,764 |
|
Net new orders |
|
|
1,611 |
|
|
|
1,106 |
|
|
|
6,727 |
|
|
|
5,744 |
|
Cancellation rate |
|
|
18.8 |
% |
|
|
22.9 |
% |
|
|
16.6 |
% |
|
|
18.3 |
% |
Homebuilding gross margin (in thousands)(2) |
|
$ |
271,267 |
|
|
$ |
232,702 |
|
|
$ |
806,394 |
|
|
$ |
727,075 |
|
Homebuilding gross margin %(3) |
|
|
17.7 |
% |
|
|
20.5 |
% |
|
|
18.3 |
% |
|
|
19.4 |
% |
Adjusted homebuilding gross margin (in thousands)(4) |
|
$ |
412,118 |
|
|
$ |
319,348 |
|
|
$ |
1,186,019 |
|
|
$ |
1,015,624 |
|
Adjusted homebuilding gross margin %(3)(4) |
|
|
26.9 |
% |
|
|
28.1 |
% |
|
|
27.0 |
% |
|
|
27.2 |
% |
Active communities as of period end(5) |
|
|
|
|
|
|
242 |
|
|
|
221 |
|
||||
Backlog - units |
|
|
|
|
|
|
2,599 |
|
|
|
3,978 |
|
||||
Backlog - value (in thousands) |
|
|
|
|
|
$ |
1,304,463 |
|
|
$ |
1,887,368 |
|
||||
Net homebuilding debt to net capitalization(4) |
|
|
|
|
|
|
33.7 |
% |
|
|
23.3 |
% |
||||
Return on participating equity(6) |
|
|
|
|
|
|
29.7 |
% |
|
|
36.3 |
% |
||||
(1) |
Average sales price of homes closed is calculated based on homebuilding revenues, adjusted for the impact of percentage of completion revenues, and excluding deposit forfeitures and land sales, over homes closed. |
|
(2) |
Homebuilding gross margin is homebuilding revenues less homebuilding cost of sales. |
|
(3) |
Calculated as a percentage of homebuilding revenues. |
|
(4) |
Adjusted homebuilding gross margin and net homebuilding debt to net capitalization are non-GAAP financial measures. For definitions of these non-GAAP financial measures and reconciliations to our most directly comparable financial measures calculated and presented in accordance with GAAP, see “Reconciliation of Non-GAAP Financial Measures” below. |
|
(5) |
A community becomes active once the model is completed or the community has its fifth net sale. A community becomes inactive when it has fewer than five homesites remaining to sell. |
|
(6) |
Return on participating equity is calculated as net income attributable to DFH, less redeemable preferred stock distributions, divided by average beginning and ending total Dream Finders Homes, Inc. stockholders’ equity (“participating equity”) for the trailing twelve months. |
|
Three Months Ended December 31, |
|
Year Ended December 31, |
||||||||||||||||
|
2024 (unaudited) |
|
2023 (unaudited) |
|
2024 (unaudited) |
|
2023 (unaudited) |
||||||||||||
Home Closings: |
Units |
|
Average Sales Price |
|
Units |
|
Average Sales Price |
|
Units |
|
Average Sales Price |
|
Units |
|
Average Sales Price |
||||
Southeast |
1,000 |
|
$ |
468,595 |
|
909 |
|
$ |
494,983 |
|
2,838 |
|
$ |
484,345 |
|
3,170 |
|
$ |
470,405 |
Mid-Atlantic |
890 |
|
|
457,164 |
|
453 |
|
|
422,596 |
|
2,594 |
|
|
446,667 |
|
1,597 |
|
|
396,462 |
Midwest |
1,118 |
|
|
582,309 |
|
791 |
|
|
607,091 |
|
3,151 |
|
|
583,198 |
|
2,547 |
|
|
618,306 |
Total |
3,008 |
|
$ |
507,477 |
|
2,153 |
|
$ |
520,940 |
|
8,583 |
|
$ |
509,249 |
|
7,314 |
|
$ |
505,764 |
Reconciliation of Non-GAAP Financial Measures
Management utilizes specific non-GAAP financial measures as supplementary tools to evaluate operating performance. These include adjusted homebuilding gross margin and net homebuilding debt to net capitalization. Other companies may not calculate non-GAAP financial measures in the same manner that we do. Accordingly, these non-GAAP financial measures should be considered only as a supplement to relevant GAAP information, as reconciled for each measure below. In the future, we may incorporate additional adjustments to these non-GAAP financial measures as we find them relevant and beneficial for both management and investors.
Adjusted Homebuilding Gross Margin
The following table presents a reconciliation of adjusted homebuilding gross margin to the GAAP financial measure of homebuilding gross margin for each of the periods indicated (unaudited and in thousands, except percentages):
|
Three Months Ended
|
|
Year Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Homebuilding gross margin(1) |
$ |
271,267 |
|
|
$ |
232,702 |
|
|
$ |
806,394 |
|
|
$ |
727,075 |
|
Interest expense in homebuilding cost of sales(2) |
|
73,102 |
|
|
|
37,173 |
|
|
|
187,324 |
|
|
|
122,759 |
|
Amortization in homebuilding cost of sales(3) |
|
(827 |
) |
|
|
— |
|
|
|
5,087 |
|
|
|
— |
|
Commission expense |
|
68,576 |
|
|
|
49,473 |
|
|
|
187,214 |
|
|
|
165,790 |
|
Adjusted homebuilding gross margin |
$ |
412,118 |
|
|
$ |
319,348 |
|
|
$ |
1,186,019 |
|
|
$ |
1,015,624 |
|
Homebuilding gross margin %(4) |
|
17.7 |
% |
|
|
20.5 |
% |
|
|
18.3 |
% |
|
|
19.4 |
% |
Adjusted homebuilding gross margin %(4) |
|
26.9 |
% |
|
|
28.1 |
% |
|
|
27.0 |
% |
|
|
27.2 |
% |
(1) |
Homebuilding gross margin is homebuilding revenues less homebuilding cost of sales. |
|
(2) |
Includes interest charged to homebuilding cost of sales related to our construction lines of credit and senior unsecured notes, net, as well as lot option fees. |
|
(3) |
Represents amortization of purchase accounting adjustments from the Crescent Homes acquisition. |
|
(4) |
Calculated as a percentage of homebuilding revenues. |
We define adjusted homebuilding gross margin as homebuilding gross margin excluding the effects of capitalized interest, lot option fees, amortization included in homebuilding cost of sales (adjustments resulting from the application of purchase accounting in connection with acquisitions) and commission expense. Our management believes this information is meaningful because it isolates the impact that these excluded items have on homebuilding gross margin. We include internal and external commission expense in homebuilding cost of sales, not selling, general and administrative expense, and therefore commission expense is taken into account in homebuilding gross margin.
As a result, in order to provide a meaningful comparison to the public company homebuilders that include commission expense below the homebuilding gross margin line in selling, general and administrative expense, we have excluded commission expense from adjusted homebuilding gross margin. However, because adjusted homebuilding gross margin information excludes capitalized interest, lot option fees, purchase accounting amortization and commission expense, which have real economic effects and could impact our results of operations, the utility of adjusted homebuilding gross margin information as a measure of our operating performance may be limited.
Net Homebuilding Debt to Net Capitalization
The following table presents a reconciliation of net homebuilding debt to net capitalization to the GAAP financial measure of total debt to total capitalization for each of the periods indicated (unaudited and in thousands, except percentages):
|
As of December 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
Total debt |
$ |
1,286,052 |
|
|
$ |
824,302 |
|
Total mezzanine equity |
|
169,951 |
|
|
|
148,500 |
|
Total equity |
|
1,250,409 |
|
|
|
937,650 |
|
Total capitalization |
$ |
2,706,412 |
|
|
$ |
1,910,452 |
|
Total debt to total capitalization |
|
47.5 |
% |
|
|
43.1 |
% |
|
|
|
|
||||
Total debt |
$ |
1,286,052 |
|
|
$ |
824,302 |
|
Less: Mortgage warehouse facilities |
|
289,617 |
|
|
|
— |
|
Less: Cash and cash equivalents |
|
274,384 |
|
|
|
494,145 |
|
Net homebuilding debt |
$ |
722,051 |
|
|
$ |
330,157 |
|
Total mezzanine equity |
|
169,951 |
|
|
|
148,500 |
|
Total equity |
|
1,250,409 |
|
|
|
937,650 |
|
Net capitalization |
$ |
2,142,411 |
|
|
$ |
1,416,307 |
|
Net homebuilding debt to net capitalization |
|
33.7 |
% |
|
|
23.3 |
% |
We define net homebuilding debt to net capitalization as the sum of construction lines of credit and senior unsecured notes, net less cash and cash equivalents (“net homebuilding debt”), divided by the sum of net homebuilding debt, total mezzanine equity and total equity (“net capitalization”). Net homebuilding debt excludes borrowings under our mortgage warehouse facilities. Management believes the net homebuilding debt to net capitalization is meaningful as it is used to assess our consolidated performance and the performance of our homebuilding segments, as well as to establish targets for performance-based compensation. We also use this ratio as a measure of overall leverage.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250224265862/en/
Investor Contact: investors@dreamfindershomes.com
Media Contact: mediainquiries@dreamfindershomes.com
Source: Dream Finders Homes, Inc.
