COLUMBUS, Ohio, April 26,
2023 /PRNewswire/ -- M/I Homes, Inc. (NYSE: MHO)
announced results for the three months ended March 31, 2023.
2023 First Quarter Highlights:
- Revenue increased 16% to $1.0
billion, a first quarter record
- Pre-tax income increased 11% to $136.0
million, a first quarter record
- Net income increased 12% to a first quarter record $103.1 million ($3.64 per diluted share) from 2022's $91.8 million ($3.16 per diluted share)
- Homes delivered increased 10% to 2,007 and average sales price
increased 6% to $486,000
- Shareholders' equity reached an all-time record of $2.2 billion, a 28% increase from a year ago,
with book value per share of $79
- Return on equity of 26%
- New contracts decreased 14% to 2,171 contracts
- Backlog sales value decreased to $1.7
billion compared to $2.8
billion a year-ago
For the first quarter of 2023, the Company reported pre-tax
income of $136.0 million and net
income of $103.1 million, or
$3.64 per diluted share. This
compares to pre-tax income of $122.3
million and net income of $91.8
million, or $3.16 per diluted
share, for the first quarter of 2022.
Homes delivered in 2023's first quarter increased 10% to 2,007
homes. This compares to 1,823 homes delivered in 2022's first
quarter. New contracts for the first quarter of 2023 decreased 14%
over 2022's 2,514 new contracts. Homes in backlog at March 31, 2023 had a total sales value of
$1.7 billion, a 38% decrease from a
year ago. Backlog units at March 31,
2023 decreased 40% to 3,301 homes, with an average sales
price of $522,000. At
March 31, 2022, backlog sales value
was $2.8 billion, with backlog units
of 5,526 and an average sales price of $505,000. M/I Homes had 200 communities at
March 31, 2023 compared to 176
communities at March 31, 2022. The
Company's cancellation rate was 13% in the first quarter of 2023
and 7% in the first quarter of 2022.
Robert H. Schottenstein, Chief
Executive Officer and President, commented, "We had strong first
quarter results highlighted by record revenue, record income and a
10% increase in homes delivered. We are particularly pleased with
our results given the material change in housing conditions
compared to a year ago; notably, significantly higher interest
rates, inflationary pressures and persistent uncertainty regarding
the general economy. We increased our revenue by 16% to a record
$1.0 billion, increased pre-tax
income by 11% to $136 million and
delivered 2,007 homes. In addition, our results reflect a 50-basis
point improvement in our overhead expense ratio."
Mr. Schottenstein continued, "Our financial condition is as
strong as it's ever been. We ended the quarter with record
shareholders' equity of $2.2 billion,
an increase of 28% over last year, book value of $79 per share, cash of $543 million, zero borrowings on our $650 million credit facility, and a homebuilding
debt to capital ratio of 24%. Despite the changes in housing
conditions over the past year, there remains a strong desire for
home ownership, and we believe our industry will continue to
benefit from strong fundamentals, including favorable demographic
trends and an undersupply of housing. Looking ahead, we are well
positioned with our diverse markets and product offerings, a strong
balance sheet and low leverage."
The Company will broadcast live its earnings conference call
today at 4:00 p.m. Eastern Time. To
listen to the call live, log on to the M/I Homes' website at
mihomes.com, click on the "Investors" section of the site, and
select "Listen to the Conference Call." A replay of the call will
continue to be available on our website through April 2024.
M/I Homes, Inc. is one of the nation's leading homebuilders of
single-family homes. The Company has homebuilding operations in
Columbus and Cincinnati, Ohio; Indianapolis, Indiana; Chicago, Illinois; Minneapolis/St. Paul, Minnesota; Detroit, Michigan; Tampa, Sarasota, Fort
Myers/Naples and
Orlando, Florida; Austin, Dallas/Fort
Worth, Houston and
San Antonio, Texas; Charlotte and Raleigh, North Carolina and Nashville, Tennessee.
Certain statements in this press release are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Words such as "expects," "anticipates,"
"targets," "envisions," "goals," "projects," "intends," "plans,"
"believes," "seeks," "estimates," variations of such words and
similar expressions are intended to identify such forward-looking
statements. These statements involve a number of risks and
uncertainties. Any forward-looking statements that we make herein
and in any future reports and statements are not guarantees of
future performance, and actual results may differ materially from
those in such forward-looking statements as a result of various
factors, including, without limitation, factors relating to the
economic environment, interest rates, availability of resources,
competition, market concentration, land development activities,
construction defects, product liability and warranty claims and
various governmental rules and regulations, as more fully discussed
in the "Risk Factors" section of the Company's Annual Report on
Form 10-K for the year ended December 31,
2022, as the same may be updated from time to time in our
subsequent filings with the Securities and Exchange Commission. All
forward-looking statements made in this press release are made as
of the date hereof, and the risk that actual results will differ
materially from expectations expressed herein will increase with
the passage of time. We undertake no duty to publicly update any
forward-looking statements, whether as a result of new information,
future events or otherwise. However, any further disclosures made
on related subjects in our subsequent filings, releases or
presentations should be consulted.
M/I Homes, Inc. and
Subsidiaries
Summary Statement of
Income (unaudited)
(Dollars and shares
in thousands, except per share amounts)
|
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2023
|
|
2022
|
New
contracts
|
2,171
|
|
2,514
|
Average community
count
|
198
|
|
176
|
Cancellation
rate
|
13 %
|
|
7 %
|
Backlog
units
|
3,301
|
|
5,526
|
Backlog sales
value
|
$
1,724,550
|
|
$
2,788,234
|
Homes
delivered
|
2,007
|
|
1,823
|
Average home closing
price
|
$
486
|
|
$
457
|
|
|
|
|
Homebuilding
revenue:
|
|
|
|
Housing
revenue
|
$
974,946
|
|
$
833,163
|
Land
revenue
|
303
|
|
3,537
|
Total homebuilding
revenue
|
$
975,249
|
|
$
836,700
|
|
|
|
|
Financial services
revenue
|
25,281
|
|
24,111
|
Total
revenue
|
$
1,000,530
|
|
$
860,811
|
|
|
|
|
Cost of sales -
operations
|
765,904
|
|
647,702
|
Gross margin
|
$
234,626
|
|
$
213,109
|
General and
administrative expense
|
50,960
|
|
48,783
|
Selling
expense
|
49,080
|
|
41,421
|
Operating
income
|
$
134,586
|
|
$
122,905
|
Other income
|
(7)
|
|
(16)
|
Interest (income)
expense
|
(1,389)
|
|
671
|
Income before income
taxes
|
$
135,982
|
|
$
122,250
|
Provision for income
taxes
|
32,916
|
|
30,411
|
Net income
|
$
103,066
|
|
$ 91,839
|
|
|
|
|
Earnings per
share:
|
|
|
|
Basic
|
$
3.73
|
|
$
3.23
|
Diluted
|
$
3.64
|
|
$
3.16
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
Basic
|
27,602
|
|
28,424
|
Diluted
|
28,305
|
|
29,072
|
M/I Homes, Inc. and
Subsidiaries
Summary Balance
Sheet and Other Information (unaudited)
(Dollars in
thousands, except per share amounts)
|
|
|
|
As of
|
|
March
31,
|
|
2023
|
|
2022
|
Assets:
|
|
|
|
Total cash, cash
equivalents and restricted cash (1)
|
$ 542,564
|
|
$ 218,606
|
Mortgage loans held for
sale
|
226,629
|
|
200,455
|
Inventory:
|
|
|
|
Lots, land and land
development
|
1,279,673
|
|
1,116,069
|
Land held for
sale
|
17,959
|
|
8,377
|
Homes under
construction
|
1,190,519
|
|
1,325,672
|
Other
inventory
|
169,258
|
|
132,434
|
Total
Inventory
|
$
2,657,409
|
|
$
2,582,552
|
|
|
|
|
Property and equipment
- net
|
37,419
|
|
36,776
|
Investments in joint
venture arrangements
|
49,031
|
|
57,309
|
Operating lease
right-of-use assets
|
59,787
|
|
50,907
|
Goodwill
|
16,400
|
|
16,400
|
Deferred income tax
asset
|
18,019
|
|
10,251
|
Other assets
|
155,112
|
|
133,255
|
Total Assets
|
$
3,762,370
|
|
$
3,306,511
|
|
|
|
|
Liabilities:
|
|
|
|
Debt - Homebuilding
Operations:
|
|
|
|
Senior notes due 2028
- net
|
$ 396,298
|
|
$ 395,524
|
Senior notes due 2030
- net
|
296,487
|
|
295,983
|
Notes payable -
other
|
—
|
|
1,871
|
Total Debt -
Homebuilding Operations
|
$ 692,785
|
|
$ 693,378
|
|
|
|
|
Notes payable bank -
financial services operations
|
223,618
|
|
203,650
|
Total Debt
|
$ 916,403
|
|
$ 897,028
|
|
|
|
|
Accounts
payable
|
208,426
|
|
281,387
|
Operating lease
liabilities
|
60,763
|
|
51,546
|
Other
liabilities
|
393,563
|
|
372,861
|
Total
Liabilities
|
$
1,579,155
|
|
$
1,602,822
|
|
|
|
|
Shareholders'
Equity
|
2,183,215
|
|
1,703,689
|
Total Liabilities and
Shareholders' Equity
|
$
3,762,370
|
|
$
3,306,511
|
|
|
|
|
Book value per common
share
|
$
78.77
|
|
$
60.22
|
Homebuilding debt to
capital ratio (2)
|
24 %
|
|
29 %
|
(1)
|
Includes $1.4 million
and $0.9 million of restricted cash and cash held in escrow for the
quarters ended March 31, 2023 and 2022, respectively.
|
(2)
|
The ratio of
homebuilding debt to capital is calculated as the carrying value of
our homebuilding debt outstanding divided by the sum of the
carrying
value of our homebuilding debt outstanding plus shareholders'
equity.
|
M/I Homes, Inc. and
Subsidiaries
Selected
Supplemental Financial and Operating Data
(unaudited)
(Dollars in
thousands)
|
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2023
|
|
2022
|
Cash provided by
operating activities
|
$
251,499
|
|
$
69,326
|
Cash used in investing
activities
|
$
(4,793)
|
|
$
(6,634)
|
Cash used in financing
activities
|
$
(15,684)
|
|
$
(80,454)
|
|
|
|
|
Land/lot
purchases
|
$
45,646
|
|
$
93,948
|
Land development
spending
|
$
92,419
|
|
$
100,697
|
Land sale
revenue
|
$
303
|
|
$
3,537
|
Land sale gross (loss)
profit
|
$
(3)
|
|
$
967
|
|
|
|
|
Financial services
pre-tax income
|
$
12,641
|
|
$
13,055
|
M/I Homes, Inc. and
Subsidiaries
Non-GAAP Financial
Results (1)
(Dollars in
thousands)
|
|
|
|
Three Months
Ended
|
|
March
31,
|
|
2023
|
|
2022
|
Net income
|
$
103,066
|
|
$
91,839
|
Add:
|
|
|
|
Provision for income
taxes
|
32,916
|
|
30,411
|
Interest
income
|
(3,673)
|
|
(557)
|
Interest amortized to
cost of sales
|
8,090
|
|
7,327
|
Depreciation and
amortization
|
4,397
|
|
4,188
|
Non-cash
charges
|
2,023
|
|
1,831
|
Adjusted
EBITDA
|
$
146,819
|
|
$
135,039
|
(1)
|
We believe these
non-GAAP financial measures are relevant and useful to investors in
understanding our operations and may be helpful in
comparing us with other companies in the homebuilding industry to
the extent they provide similar information. These non-GAAP
financial
measures should be used to supplement our GAAP results in order to
provide a greater understanding of the factors and trends affecting
our
operations.
|
M/I Homes, Inc. and
Subsidiaries
Selected
Supplemental Financial and Operating Data
|
|
|
|
NEW
CONTRACTS
|
|
|
Three Months
Ended
|
|
|
March
31,
|
|
|
|
|
|
|
%
|
Region
|
|
2023
|
|
2022
|
|
Change
|
Northern
|
|
828
|
|
1,190
|
|
(30) %
|
Southern
|
|
1,343
|
|
1,324
|
|
1 %
|
Total
|
|
2,171
|
|
2,514
|
|
(14) %
|
|
HOMES
DELIVERED
|
|
|
Three Months
Ended
|
|
|
March
31,
|
|
|
|
|
|
|
%
|
Region
|
|
2023
|
|
2022
|
|
Change
|
Northern
|
|
797
|
|
760
|
|
5 %
|
Southern
|
|
1,210
|
|
1,063
|
|
14 %
|
Total
|
|
2,007
|
|
1,823
|
|
10 %
|
|
BACKLOG
|
|
March 31,
2023
|
|
|
March 31,
2022
|
|
|
|
Dollars
|
|
Average
|
|
|
|
|
Dollars
|
|
Average
|
Region
|
Units
|
|
(millions)
|
|
Sales
Price
|
|
|
Units
|
|
(millions)
|
|
Sales
Price
|
Northern
|
1,087
|
|
$
560
|
|
$
515,000
|
|
|
2,320
|
|
$
1,145
|
|
$
494,000
|
Southern
|
2,214
|
|
$
1,165
|
|
$
526,000
|
|
|
3,206
|
|
$
1,643
|
|
$
513,000
|
Total
|
3,301
|
|
$
1,725
|
|
$
522,000
|
|
|
5,526
|
|
$
2,788
|
|
$
505,000
|
|
LAND POSITION
SUMMARY
|
|
March 31,
2023
|
|
|
March 31,
2022
|
|
Lots
|
Lots
Under
|
|
|
|
Lots
|
Lots
Under
|
|
Region
|
Owned
|
Contract
|
Total
|
|
|
Owned
|
Contract
|
Total
|
Northern
|
7,712
|
7,214
|
14,926
|
|
|
7,359
|
7,906
|
15,265
|
Southern
|
16,054
|
9,761
|
25,815
|
|
|
16,871
|
13,646
|
30,517
|
Total
|
23,766
|
16,975
|
40,741
|
|
|
24,230
|
21,552
|
45,782
|
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SOURCE M/I Homes, Inc.