Forestar Reports Fiscal 2022 First Quarter Results
Fiscal 2022 First Quarter Highlights
All comparisons are year-over-year, unless otherwise noted
-
Net income attributable to Forestar increased
84% to or$40.5 million per diluted share$0.81 -
Pre-tax income increased
83% to , while pre-tax profit margin increased 360 basis points to$53.5 million 13.1% -
Revenues increased
33% to$407.6 million -
Residential lots sold in the quarter increased
27% to 4,516 lots -
Owned and controlled lots increased
33% to 103,300 lots -
Achieved return on equity ("ROE") of
13.2% for the trailing twelve months endedDecember 31, 2021 , an improvement of 550 basis points; 7th consecutive quarter of ROE improvement -
Increasing fiscal 2022 guidance:
- Lots sold to 19,500 to 20,000 lots compared to prior guidance of 19,000 to 19,500 lots
-
Revenue to approximately
compared to prior guidance of$1.7 billion $1.65 billion -
Pre-tax profit margin to a range of
13.5% to14.0% compared to prior guidance of approximately13.0%
Financial Results
Net income attributable to Forestar for the first quarter of fiscal 2022 increased
The Company's ROE was
Operational Results
Lots sold during the first quarter increased
The Company's lot position at
Lots owned at
Capital Structure, Leverage and Liquidity
Forestar ended the first quarter with
Outlook
"Forestar's return-focused business model is centered on our high inventory turnover, lower risk lot manufacturing strategy. Our strategic and operational plan is underpinned by our low net leverage and strong liquidity, the engagement of our people and our strategic relationship with
Conference Call and Webcast Details
The Company will host a conference call today (
About
Forward-Looking Statements
Portions of this document may constitute "forward-looking statements" as defined by the Private Securities Litigation Reform Act of 1995. Although Forestar believes any such statements are based on reasonable assumptions, there is no assurance that actual outcomes will not be materially different. All forward-looking statements are based upon information available to Forestar on the date this release was issued. Forestar does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements in this release include that Forestar is extremely well-positioned to continue capturing market share in the highly fragmented lot development industry; we now expect to deliver between 19,500 and 20,000 lots generating approximately
Factors that may cause the actual results to be materially different from the future results expressed by the forward-looking statements include, but are not limited to: the effect of
Consolidated Balance Sheets (Unaudited) |
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(In millions, except share data) |
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ASSETS |
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|
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Cash and cash equivalents |
$ |
162.5 |
|
$ |
153.6 |
Real estate |
|
1,960.1 |
|
|
1,905.2 |
Investment in unconsolidated ventures |
|
0.5 |
|
|
0.9 |
Property and equipment, net |
|
4.2 |
|
|
2.9 |
Other assets |
|
35.2 |
|
|
39.1 |
Total assets |
$ |
2,162.5 |
|
$ |
2,101.7 |
LIABILITIES |
|
|
|
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Accounts payable |
$ |
53.5 |
|
$ |
47.4 |
Accrued development costs |
|
116.7 |
|
|
104.5 |
Earnest money on sales contracts |
|
141.9 |
|
|
148.3 |
Deferred tax liability, net |
|
24.2 |
|
|
24.4 |
Accrued expenses and other liabilities |
|
62.9 |
|
|
56.7 |
Debt |
|
704.9 |
|
|
704.5 |
Total liabilities |
|
1,104.1 |
|
|
1,085.8 |
EQUITY |
|
|
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Common stock, par value |
|
49.7 |
|
|
49.6 |
Additional paid-in capital |
|
638.1 |
|
|
636.2 |
Retained earnings |
|
369.6 |
|
|
329.1 |
Stockholders' equity |
|
1,057.4 |
|
|
1,014.9 |
Noncontrolling interests |
|
1.0 |
|
|
1.0 |
Total equity |
|
1,058.4 |
|
|
1,015.9 |
Total liabilities and equity |
$ |
2,162.5 |
|
$ |
2,101.7 |
Consolidated Statements of Operations (Unaudited) |
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Three Months Ended
|
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2021 |
|
2020 |
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(In millions, except per share amounts) |
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Revenues |
$ |
407.6 |
|
|
$ |
307.1 |
|
Cost of sales |
|
334.2 |
|
|
|
262.9 |
|
Selling, general and administrative expense |
|
21.5 |
|
|
|
15.5 |
|
Equity in earnings of unconsolidated ventures |
|
(1.1 |
) |
|
|
(0.2 |
) |
Gain on sale of assets |
|
(0.5 |
) |
|
|
— |
|
Interest and other income |
|
— |
|
|
|
(0.3 |
) |
Income before income taxes |
|
53.5 |
|
|
|
29.2 |
|
Income tax expense |
|
13.0 |
|
|
|
7.1 |
|
Net income |
|
40.5 |
|
|
|
22.1 |
|
Net income attributable to noncontrolling interests |
|
— |
|
|
|
0.1 |
|
Net income attributable to |
$ |
40.5 |
|
|
$ |
22.0 |
|
|
|
|
|
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Basic net income per common share attributable to |
$ |
0.81 |
|
|
$ |
0.46 |
|
Weighted average number of common shares |
|
49.7 |
|
|
|
48.1 |
|
|
|
|
|
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Diluted net income per common share attributable to |
$ |
0.81 |
|
|
$ |
0.46 |
|
Adjusted weighted average number of common shares |
|
49.7 |
|
|
|
48.2 |
|
Revenues, Residential Lots Sold and Lot Position (Unaudited) |
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REVENUES |
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Three Months Ended |
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2021 |
|
2020 |
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(In millions) |
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Residential lot sales: |
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|
|
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Development projects |
$ |
393.0 |
|
$ |
271.1 |
|
Lot banking projects |
|
9.0 |
|
|
35.7 |
|
Decrease in contract liabilities |
|
2.1 |
|
|
0.2 |
|
|
|
404.1 |
|
|
307.0 |
|
Tract sales and other |
|
3.5 |
|
|
0.1 |
|
Total revenues |
$ |
407.6 |
|
$ |
307.1 |
|
|
|
|
|
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RESIDENTIAL LOTS SOLD |
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Three Months Ended |
|
||||
|
2021 |
|
2020 |
|
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Development projects |
|
4,381 |
|
|
3,102 |
|
Lot banking projects |
|
135 |
|
|
465 |
|
|
|
4,516 |
|
|
3,567 |
|
|
|
|
|
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Average sales price per lot (1) |
$ |
89,000 |
|
$ |
86,000 |
|
|
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LOT POSITION |
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Lots owned |
|
65,700 |
(2) |
|
64,400 |
(3) |
Lots controlled through land and lot purchase contracts |
|
37,600 |
|
|
32,600 |
|
Total lots owned and controlled |
|
103,300 |
|
|
97,000 |
|
____________ |
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(1) |
Excludes impact from change in contract liabilities. |
|
(2) |
Lots owned at |
|
(3) |
Lots owned at |
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Investor Relations:
InvestorRelations@forestar.com
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