Pulte Homes Announces Record First Quarter Results
BLOOMFIELD HILLS, Mich., Apr 27, 2005 (BUSINESS WIRE) -- Pulte Homes, Inc. (NYSE:PHM)
-- Earnings from Continuing Operations Increase 63% to $1.66 Per Diluted Share
-- First Quarter Income from Continuing Operations Increases 65% to $218.3 million
-- Domestic Net New Orders Climb 22% to $3.8 Billion; Unit Orders Up 12% to 12,067 Homes
-- Backlog Value Climbs 22% to Over $6.5 Billion; Unit Backlog Up 13% to 19,964 Homes
-- Company Raises Full Year Earnings Outlook
Pulte Homes, Inc. (NYSE:PHM) announced today record financial results for its first quarter ended March 31, 2005. First quarter income from continuing operations was a record $218.3 million, an increase of 65% over prior year first quarter income of $132.2 million. First quarter earnings from continuing operations of $1.66 per diluted share represents an increase of 63% over prior year earnings from continuing operations of $1.02 per diluted share.
For the quarter, Pulte's consolidated revenues were $2.55 billion, an increase of 26% over prior year revenues of $2.03 billion.
"We are extremely pleased with the performance of our operations in the first quarter, particularly in the areas of revenue growth, margin expansion and our 22% increase in the value of first quarter orders," said Richard J. Dugas, Jr., President and CEO of Pulte Homes. "Given the strength of our first quarter results, combined with a record backlog and opportunities to further expand Pulte Homes' share of the new home market, we are in an excellent position to deliver record earnings in 2005. We now expect full year 2005 earnings to be in the range of $9.35 to $9.85 per diluted share, up from prior guidance of $9.00 to $9.50 per diluted share."
First quarter revenues from domestic homebuilding settlements increased 27% to $2.5 billion. Higher revenues for the period were the result of a 14% increase in closings to 8,019 homes, combined with an 11% increase in average selling price to $307,000. The higher average selling price resulted from favorable changes in the mix of houses closed combined with price increases realized during the quarter.
First quarter domestic homebuilding pretax income increased 62% to $359.6 million, compared with prior year first quarter pretax income of $222.5 million. Pretax income for the quarter benefited from an approximately 270 basis point improvement in gross margins from home sales to 24.6%. Margin expansion was driven by price increases realized during the quarter, a favorable product mix and initiatives to improve overall operating efficiencies. The Company was also successful in lowering domestic homebuilding selling, general & administrative expenses as a percent of home settlement revenues for the quarter by approximately 30 basis points to 10.3%.
Land sales and related gross profit in the first quarter were essentially unchanged at $24.2 million and $3.4 million, respectively, compared with $23.1 million and $3.5 million, respectively, in the prior year. Land sales are an important part of Pulte Homes' overall land management strategy, but sales can fluctuate quarter-to-quarter depending upon the timing of individual land transactions.
Domestic net new home orders for the quarter were 12,067, up 12% over prior year first quarter orders of 10,751 homes. The Company's ending backlog was valued at a record $6.5 billion (totaling 19,964 homes), compared with a value of $5.4 billion (17,664 homes) last year.
"Our results continue to benefit from Pulte Homes' strategy of serving all major buyer segments including first time, first and second move up and particularly in active adult through our Del Webb brand," said Mr. Dugas. "As the year progresses, we will continue to see the impact of efforts begun several years ago to expand the Del Webb brand into new cities, as we introduce these spectacular communities in such markets as Detroit, Denver, Jacksonville and Charlotte."
The Company's financial services operations reported first quarter pretax income of $10.1 million, compared with prior year pretax income of $10.1 million. Loan originations for the first quarter increased 24% to 7,592 mortgages.
For the first quarter, Pulte's International operations reported pretax income of $1.3 million, compared with pretax income of $787 thousand last year. First quarter results for both years have been adjusted to reflect the previously announced sale of the Company's Argentina operations in January 2005.
A conference call discussing Pulte's first quarter results will be held Thursday, April 28, 2005 at 8:30 a.m. Eastern Time, and web cast live via Pulte.com. Interested investors can access the call via the Company's home page at www.pulte.com.
Certain statements in this release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among other things, (1) general economic and business conditions; (2) interest rate changes and the availability of mortgage financing; (3) the relative stability of debt and equity markets; (4) competition; (5) the availability and cost of land and other raw materials used by the Company in its homebuilding operations; (6) the availability and cost of insurance covering risks associated with our business; (7) shortages and the cost of labor; (8) weather related slowdowns; (9) slow growth initiatives and/or local building moratoria; (10) governmental regulation, including the interpretation of tax, labor and environmental laws; (11) changes in consumer confidence and preferences; (12) required accounting changes; (13) terrorist acts and other acts of war; and (14) other factors over which the Company has little or no control. All forward-looking statements made are made as of the date hereof, and the risk that actual results will differ materially from expectations will increase with the passage of time. Pulte undertakes no duty to update any forward-looking statement whether as a result of new information, future events or changes in Pulte's expectations.
About Pulte Homes
Pulte Homes, Inc., (NYSE:PHM), based in Bloomfield Hills, Mich., is a FORTUNE 200 company with operations in 47 markets and 27 states. In 2004, the company closed 38,612 domestic home sales and generated revenues of $11.7 billion. During its 55-year history, the company has constructed more than 408,000 homes. In 2004, J.D. Power and Associates named Pulte the inaugural recipient of its Platinum Award for Excellence in Customer Service among America's leading homebuilders. J.D. Power ranked Pulte No. 1 in 14 markets, and among the top three in 23 of 25 markets surveyed. Under its Del Webb brand, Pulte is the nation's leading builder of active adult communities for people age 55 and better. Its DiVosta operation is nationally recognized for a trademarked building system that has delivered more than 25,000 "Built Solid"(R) homes in Florida since 1960. Pulte Mortgage LLC is a nationwide lender and offers Pulte customers a wide variety of loan products and superior customer service.
Websites: www.pulte.com; www.delwebb.com; www.divosta.com
Pulte Homes, Inc. Condensed Consolidated Results Of Operations (000's omitted, except per share data) (Unaudited) Three Months Ended March 31, ----------------------- 2005 2004 ----------- -----------CONSOLIDATED RESULTS:Revenues: Homebuilding $2,523,070 $2,006,263 Financial Services 30,276 24,572 Corporate 1,248 897 ----------- -----------Total Revenues $2,554,594 $2,031,732 =========== ===========Pretax income (loss): Homebuilding 360,842 223,312 Financial Services 10,084 10,089 Corporate (22,756) (20,228) ----------- -----------Income from continuing operations before income taxes 348,170 213,173Income taxes (129,850) (80,996) ----------- -----------Income from continuing operations $218,320 $132,177Income(loss) from discontinued operations (78) (548) ----------- -----------Net income $218,242 $131,629 =========== ===========EARNINGS PER SHARE - ASSUMING DILUTION:Income from continuing operations $1.66 $1.02Income (loss) from discontinued operations - - ----------- -----------Net income $1.66 $1.02 =========== ===========Shares used in per share calculations 131,377 128,829 =========== =========== Pulte Homes, Inc. Condensed Consolidated Balance Sheets ($000's omitted) March 31, December 31, March 31, 2005 2004 2004 (Unaudited) (Unaudited) ------------ ------------ -----------ASSETSCash and equivalents $350,716 $314,634 $463,417Unfunded settlements 74,352 118,471 70,598House and land inventory 8,090,804 7,390,791 5,992,557Land held for sale 226,044 230,743 240,627Land, not owned, under option agreements 134,061 106,380 136,036Residential mortgage loans available-for-sale 408,074 697,077 304,526Investment in unconsolidated entities 309,321 258,868 110,187Goodwill 307,693 307,693 307,693Intangible assets 133,392 135,454 141,642Other assets 866,650 846,786 586,844 ------------ ------------------------ $10,901,107 $10,406,897 $8,354,127 ============ ============ ===========LIABILITIES AND SHAREHOLDERS' EQUITYLiabilities: Accounts payable, accrued and other liabilities $2,179,325 $2,203,101 $1,861,741 Collateralized short-term debt, recourse solely to applicable subsidiary assets 338,671 617,415 255,738 Income taxes 102,789 202,557 38,284 Senior notes and subordinated notes 3,510,455 2,861,550 2,573,633 ------------ ------------ ----------- Total Liabilities 6,131,240 5,884,623 4,729,396Shareholders' Equity 4,769,867 4,522,274 3,624,731 ------------ ------------ ----------- $10,901,107 $10,406,897 $8,354,127 ============ ============ =========== Pulte Homes, Inc. Segment Data ($000's omitted) (Unaudited) Three Months Ended March 31, ----------------------- 2005 2004 ----------- -----------HOMEBUILDING: Pretax income: Domestic $359,582 $222,525 International 1,260 787 ----------- ----------- Total Homebuilding $360,842 $223,312 =========== ===========Domestic Homebuilding: Home sales (settlements) $2,462,109 $1,942,541 Land sales 24,185 23,141 ----------- ----------- Domestic Homebuilding Revenue 2,486,294 1,965,682 Home cost of sales (1,856,468) (1,516,324) Land cost of sales (20,759) (19,612) Selling, general & administrative expense (254,431) (205,601) Other income (expense), net 4,946 (1,620) ----------- ----------- Pretax income $359,582 $222,525 =========== ===========International Homebuilding: Home sales (settlements) $36,776 $40,581 Cost of sales (28,202) (32,898) Selling, general & administrative expense (8,228) (6,699) Other income (expense), net (302) (619) Minority Interest (201) (397) Equity in income of joint venture operations 1,417 819 ----------- ----------- Pretax income $1,260 $787 =========== ===========FINANCIAL SERVICES: Pretax income $10,084 $10,089 =========== ===========CORPORATE: Pretax loss: Net interest expense $(13,747) $(11,635) Other Corporate expense, net (9,009) (8,593) ----------- ----------- Total Corporate $(22,756) $(20,228) =========== =========== Pulte Homes, Inc. Business Operating Data ($000's omitted) (Unaudited) Three Months Ended March 31, ----------------------- 2005 2004 ----------- -----------HOMEBUILDING SETTLEMENT REVENUES: Domestic $2,462,109 $1,942,541 International 36,776 40,581 ----------- ----------- Total settlement revenues $2,498,885 $1,983,122 =========== ===========HOMEBUILDING UNIT SETTLEMENTS: Domestic 8,019 7,039 International 1,313 1,547 ----------- ----------- Total settlement units 9,332 8,586 =========== ===========Domestic Homebuilding: Unit settlements: Northeast 538 519 Southeast 2,331 1,705 Midwest 901 773 Central 926 974 West 3,323 3,068 ----------- ----------- 8,019 7,039 =========== =========== Average selling price $307 $276 =========== =========== Unit net new orders: Northeast 1,028 714 Southeast 3,717 2,769 Midwest 1,519 1,487 Central 1,620 1,576 West 4,183 4,205 ----------- ----------- 12,067 10,751 =========== =========== Unit net new orders - dollars $3,833,000 $3,153,000 =========== =========== Unit backlog: Northeast 1,973 1,730 Southeast 6,691 4,790 Midwest 1,895 2,115 Central 1,771 1,758 West 7,634 7,271 ----------- ----------- 19,964 17,664 =========== =========== Dollars in backlog $6,525,000 $5,357,000 =========== =========== Pulte Homes, Inc. Business Operating Data, continued ($000's omitted) (Unaudited) Three Months Ended March 31, ----------------------- 2005 2004 ----------- -----------MORTGAGE ORIGINATIONS: Origination volume 7,592 6,113 =========== =========== Origination principal $1,489,400 $1,152,700 =========== =========== Capture rate percentage 88.7% 86.1% =========== =========== Pulte Homes, Inc. Supplemental Information ($000's omitted) (Unaudited) Three Months Ended March 31, ----------------------- 2005 2004 ----------- -----------Interest expense: Homebuilding (included in home cost of sales) $30,544 $21,612 Corporate 14,995 12,532 Financial Services 2,801 1,498 ----------- ----------- Total interest expense $48,340 $35,642 =========== ===========Depreciation & amortization $13,733 $10,160 =========== ===========
SOURCE: Pulte Homes, Inc. |
