COLUMBUS, Ohio, July 30, 2024 /PRNewswire/ -- M/I Homes, Inc. (NYSE:MHO) announced results for the three and six months ended June 30, 2024.
2024 Second Quarter Highlights:
The Company reported pre-tax income of $194.1 million and net income of $146.7 million ($5.12 per diluted share), both all-time quarterly records. This compares to pre-tax income of $155.4 million and net income of $118.0 million, or $4.12 per diluted share, for the second quarter of 2023. For the six months ended June 30, 2024, pre-tax income increased to a record $374.4 million and net income increased to a record $284.8 million, or $9.90 per diluted share, compared to $291.3 million and $221.1 million, or $7.77 per diluted share, for the same period of 2023, respectively.
Homes delivered in 2024's second quarter increased 12% to 2,224 homes. This compares to 1,990 homes delivered in 2023's second quarter. Homes delivered for the six months ended June 30, 2024 increased 10% to 4,382 from 2023's deliveries of 3,997. New contracts for the second quarter of 2024 increased 3% to 2,255 compared to 2,197 in 2023. For the first half of 2024, new contracts increased 10% to 4,802 compared to 4,368 in 2023. Homes in backlog at June 30, 2024 had a total sales value of $1.82 billion, a 3% increase from a year ago. Backlog units at June 30, 2024 decreased 2% to 3,422 homes, with an average sales price of $533,000. At June 30, 2023, backlog sales value was $1.78 billion, with backlog units of 3,508 and an average sales price of $507,000. M/I Homes had 211 communities at June 30, 2024 compared to 195 communities at June 30, 2023. The Company's cancellation rate was 10% in both the second quarter of 2024 and the second quarter of 2023.
Robert H. Schottenstein, Chief Executive Officer and President, commented, "We had a very strong second quarter highlighted by all-time quarterly records in income, gross margins and pre-tax margins. For the quarter, revenue increased by 9%, gross margins were 28% compared to 25% a year-ago, pre-tax margins were 17.5% compared to 15.3% a year ago, and pre-tax income improved by 25% to an all-time record $194.1 million. These results produced a solid 21% return on equity."
Mr. Schottenstein continued, "Our financial condition is strong. We ended the quarter with record shareholders' equity of $2.7 billion, an increase of 19% from a year ago, book value of $100 per share, cash of $837 million, a homebuilding debt to capital ratio of 20%, and a net-debt-to-capital ratio of negative 6%. Given our first-half performance, along with the strength of our balance sheet, low debt levels, diverse product offerings and well-located communities, we are positioned to have a very strong 2024."
The Company will broadcast live its earnings conference call today at 10:30 A.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 July 2025.
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, 2023, 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
Six Months Ended
June 30,
2024
2023
New contracts
2,255
2,197
4,802
4,368
Average community count
215
198
214
197
Cancellation rate
10 %
9 %
12 %
Backlog units
3,422
3,508
Backlog sales value
$ 1,822,686
$ 1,777,657
Homes delivered
2,224
1,990
4,382
3,997
Average home closing price
$ 482
$ 493
$ 477
$ 489
Homebuilding revenue:
Housing revenue
$ 1,072,044
$ 980,198
$ 2,088,557
$ 1,955,144
Land revenue
6,975
8,549
10,203
8,852
Total homebuilding revenue
$ 1,079,019
$ 988,747
$ 2,098,760
$ 1,963,996
Financial services revenue
30,762
25,266
57,724
50,547
Total revenue
$ 1,109,781
$ 1,014,013
$ 2,156,484
$ 2,014,543
Cost of sales - operations
800,501
755,829
1,563,861
1,521,733
Gross margin
$ 309,280
$ 258,184
$ 592,623
$ 492,810
General and administrative expense
63,994
55,654
120,078
106,614
Selling expense
58,495
51,871
112,435
100,951
Operating income
$ 186,791
$ 150,659
$ 360,110
$ 285,245
Other income
—
(28)
(35)
Interest income, net of interest expense
(7,348)
(4,670)
(14,268)
(6,059)
Income before income taxes
$ 194,139
$ 155,357
$ 374,378
$ 291,339
Provision for income taxes
47,393
37,356
89,571
70,272
Net income
$ 146,746
$ 118,001
$ 284,807
$ 221,067
Earnings per share:
Basic
$ 5.26
$ 4.25
$ 10.18
$ 7.98
Diluted
$ 5.12
$ 4.12
$ 9.90
$ 7.77
Weighted average shares outstanding:
27,878
27,792
27,965
27,698
28,668
28,624
28,777
28,469
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)
$ 837,458
$ 668,287
Mortgage loans held for sale
227,254
190,845
Inventory:
Lots, land and land development
1,467,961
1,296,486
Land held for sale
4,235
15,183
Homes under construction
1,306,650
1,207,759
Other inventory
159,618
167,586
Total Inventory
$ 2,938,464
$ 2,687,014
Property and equipment - net
36,438
35,495
Investments in joint venture arrangements
46,180
41,988
Operating lease right-of-use assets
56,697
58,404
Goodwill
16,400
Deferred income tax asset
15,313
18,019
Other assets
165,866
145,297
Total Assets
$ 4,340,070
$ 3,861,749
Liabilities:
Debt - Homebuilding Operations:
Senior notes due 2028 - net
$ 397,266
$ 396,492
Senior notes due 2030 - net
297,117
296,613
Total Debt - Homebuilding Operations
$ 694,383
$ 693,105
Notes payable bank - financial services operations
222,792
186,396
Total Debt
$ 917,175
$ 879,501
Accounts payable
278,859
264,656
Operating lease liabilities
58,043
59,461
Other liabilities
344,876
359,672
Total Liabilities
$ 1,598,953
$ 1,563,290
Shareholders' Equity
2,741,117
2,298,459
Total Liabilities and Shareholders' Equity
Book value per common share
$ 100.03
$ 82.73
Homebuilding debt to capital ratio (2)
20 %
23 %
(1)
Includes $0.2 million and $0.9 million of restricted cash and cash held in escrow for the quarters ended June 30, 2024 and 2023, 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.
Selected Supplemental Financial and Operating Data (unaudited)
(Dollars in thousands)
Cash provided by operating activities
$ 27,511
$ 166,190
$ 143,283
$ 417,689
Cash (used in) provided by investing activities
$ (10,433)
$ 1,991
$ (27,541)
$ (2,802)
Cash used in financing activities
$ (49,782)
$ (42,458)
$ (11,088)
$ (58,142)
Land/lot purchases
$ 119,182
$ 96,068
$ 226,842
$ 141,714
Land development spending
$ 144,539
$ 108,914
$ 263,906
$ 201,333
Land sale revenue
$ 6,975
$ 8,549
$ 10,203
$ 8,852
Land sale gross profit
$ 1,933
$ 892
$ 3,246
$ 889
Financial services pre-tax income
$ 14,400
$ 11,159
$ 26,712
$ 23,800
Non-GAAP Financial Results (1)
Add:
Interest income - net
(10,686)
(6,980)
(20,453)
(10,653)
Interest amortized to cost of sales
7,938
8,734
16,240
16,774
Depreciation and amortization
4,607
4,266
9,074
8,663
Non-cash charges
3,810
2,301
7,349
4,374
Adjusted EBITDA
$ 199,808
$ 163,678
$ 386,588
$ 310,497
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.
Selected Supplemental Financial and Operating Data
NEW CONTRACTS
%
Region
Change
Northern
1,002
949
6 %
2,164
1,777
22 %
Southern
1,253
1,248
— %
2,638
2,591
2 %
Total
3 %
HOMES DELIVERED
951
783
21 %
1,794
1,580
14 %
1,273
1,207
5 %
2,588
2,417
7 %
BACKLOG
June 30, 2024
June 30, 2023
Dollars
Average
Units
(millions)
Sales Price
1,618
$ 853
$ 527,000
$ 631
$ 504,000
1,804
$ 970
$ 538,000
$ 1,147
$ 509,000
$ 1,823
$ 533,000
$ 1,778
$ 507,000
LAND POSITION SUMMARY
Lots
Lots Under
Owned
Contract
6,784
10,250
17,034
7,545
7,199
14,744
16,520
15,898
32,418
15,893
10,695
26,588
23,304
26,148
49,452
23,438
17,894
41,332
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SOURCE M/I Homes, Inc.