COLUMBUS, Ohio, April 27, 2022 /PRNewswire/ -- M/I Homes, Inc. (NYSE:MHO) announced results for the three months ended March 31, 2022.
2022 First Quarter Highlights:
For the first quarter of 2022, the Company reported pre-tax income of $122.3 million and net income of $91.8 million, or $3.16 per diluted share. This compares to pre-tax income of $110.3 million and net income of $84.9 million, or $2.85 per diluted share, for the first quarter of 2021.
Homes delivered in 2022's first quarter decreased 10% to 1,823 homes. This compares to 2,019 homes delivered in 2021's first quarter. New contracts for the first quarter of 2022 decreased 19% over 2021's 3,109 new contracts. Homes in backlog at March 31, 2022 had a total sales value of $2.8 billion, a 17% increase from a year ago and an all-time quarterly record. Backlog units at March 31, 2022 increased 1% to an all-time quarterly record 5,526 homes, with an average sales price of $505,000. At March 31, 2021, backlog sales value was $2.4 billion, with backlog units of 5,479 and an average sales price of $433,000. M/I Homes had 176 active communities at March 31, 2022 compared to 187 communities at March 31, 2021. The Company's cancellation rate was 7% in both the first quarter of 2022 and 2021.
Robert H. Schottenstein, Chief Executive Officer and President, commented, "We had strong first quarter results highlighted by record levels of revenue, income and quarter-end backlog. Our revenue increased 4% to $861 million, pre-tax income and diluted earnings per share each improved 11% to $122 million and $3.16 per share. We achieved these record first quarter results due to a 16% increase in our average closing price, a 40 basis point improvement in our gross margin to 24.8% and a 50 basis point improvement in our overhead expense ratio. Our return on equity remained strong at 26%. We are particularly pleased with these results given the unprecedented labor challenges and supply chain issues that impacted our deliveries. In addition, despite a 6% decline in community count and limiting sales in most of our communities, we achieved record backlog units and backlog sales value, with sales value improving 17% from a year ago."
Mr. Schottenstein continued, "We ended the quarter with record shareholders' equity of $1.7 billion, an increase of 26% from 2021, book value per share of $60, cash of $219 million, no borrowings on our $550 million credit facility and a homebuilding debt to capital ratio of 29%. During the quarter, we also repurchased $15 million of our common shares. Demand for new homes remains strong despite the increase in interest rates. Looking ahead, given our record backlog and strong backlog margins, along with a record number of new community openings planned this year, we are positioned to achieve another year of strong results in 2022."
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 2023.
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 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, 2021, 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,
2022
2021
New contracts
2,514
3,109
Average community count
176
195
Cancellation rate
7%
Backlog units
5,526
5,479
Backlog sales value
$ 2,788,234
$ 2,373,828
Homes delivered
1,823
2,019
Average home closing price
$ 457
$ 395
Homebuilding revenue:
Housing revenue
$ 833,163
$ 798,279
Land revenue
3,537
848
Total homebuilding revenue
$ 836,700
$ 799,127
Financial services revenue
24,111
29,649
Total revenue
$ 860,811
$ 828,776
Cost of sales - operations
647,702
626,585
Gross margin
$ 213,109
$ 202,191
General and administrative expense
48,783
45,205
Selling expense
41,421
45,689
Operating income
$ 122,905
$ 111,297
Other income
(16)
(160)
Interest expense
671
1,176
Income before income taxes
$ 122,250
$ 110,281
Provision for income taxes
30,411
25,415
Net income
$ 91,839
$ 84,866
Earnings per share:
Basic
$ 3.23
$ 2.92
Diluted
$ 3.16
$ 2.85
Weighted average shares outstanding:
28,424
29,015
29,072
29,743
M/I Homes, Inc. and Subsidiaries Summary Balance Sheet and Other Information (unaudited) (Dollars in thousands, except per share amounts)
As of
Assets:
Total cash, cash equivalents and restricted cash (1)
$ 218,606
$ 292,900
Mortgage loans held for sale
200,455
217,524
Inventory:
Lots, land and land development
1,116,069
831,837
Land held for sale
8,377
4,085
Homes under construction
1,325,672
985,227
Other inventory
132,434
139,385
Total Inventory
$ 2,582,552
$ 1,960,534
Property and equipment - net
36,776
24,939
Investments in joint venture arrangements
57,309
33,822
Operating lease right-of-use assets
50,907
51,755
Goodwill
16,400
Deferred income tax asset
10,251
6,183
Other assets
133,255
105,503
Total Assets
$ 3,306,511
$ 2,709,560
Liabilities:
Debt - Homebuilding Operations:
Senior notes due 2025 - net
$ —
$ 247,743
Senior notes due 2028 - net
395,524
394,750
Senior notes due 2030 - net
295,983
—
Notes payable - other
1,871
2,544
Total Debt - Homebuilding Operations
$ 693,378
$ 645,037
Notes payable bank - financial services operations
203,650
176,204
Total Debt
$ 897,028
$ 821,241
Accounts payable
281,387
198,216
Operating lease liabilities
51,546
52,029
Other liabilities
372,861
284,652
Total Liabilities
$ 1,602,822
$ 1,356,138
Shareholders' Equity
1,703,689
1,353,422
Total Liabilities and Shareholders' Equity
Book value per common share
$ 60.22
$ 46.37
Homebuilding debt to capital ratio (2)
29%
32%
(1)
Includes $0.9 million and $0.5 million of restricted cash and cash held in escrow for the quarters ended March 31, 2022 and 2021, 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)
Cash provided by operating activities
$ 69,326
$ 75,168
Cash (used in) provided by investing activities
$ (6,634)
$ 623
Cash used in by financing activities
$ (80,454)
$ (43,701)
Land/lot purchases
$ 93,948
$ 92,358
Land development spending
$ 100,697
$ 71,195
Land sale revenue
$ 3,537
$ 848
Land sale gross profit
$ 967
$ 250
Financial services pre-tax income
$ 13,055
$ 19,693
M/I Homes, Inc. and Subsidiaries Non-GAAP Financial Results (1) (Dollars in thousands)
Add:
Interest (income) expense-net of interest income
(557)
275
Interest amortized to cost of sales
7,327
8,205
Depreciation and amortization
4,188
4,110
Non-cash charges
1,831
2,102
Adjusted EBITDA
$ 135,039
$ 124,973
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 SubsidiariesSelected Supplemental Financial and Operating Data
NEW CONTRACTS
%
Region
Change
Northern
1,190
1,306
(9) %
Southern
1,324
1,803
(27) %
Total
(19) %
HOMES DELIVERED
760
801
(5) %
1,063
1,218
(13) %
(10) %
BACKLOG
March 31, 2022
March 31, 2021
Dollars
Average
Units
(millions)
Sales Price
2,320
$ 1,145
$ 494,000
$ 1,049
$ 452,000
3,206
$ 1,643
$ 513,000
3,159
$ 1,325
$ 419,000
$ 2,788
$ 505,000
$ 2,374
$ 433,000
LAND POSITION SUMMARY
Lots
Lots Under
Owned
Contract
7,359
7,906
15,265
6,242
8,489
14,731
16,871
13,646
30,517
10,522
16,730
27,252
24,230
21,552
45,782
16,764
25,219
41,983
View original content to download multimedia:https://www.prnewswire.com/news-releases/mi-homes-reports-2022-first-quarter-results-301534117.html
SOURCE M/I Homes, Inc.