Toggle SGML Header (+)


Section 1: 8-K (8-K)

CCS 06302019 Earnings Release 8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

____________________

FORM 8-K

____________________

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934



Date of Report (Date of earliest event reported): July 30, 2019

____________________

CENTURY COMMUNITIES, INC.

(Exact name of registrant as specified in its charter)

____________________

Delaware

(State or Other Jurisdiction of Incorporation)



 

001-36491

68-0521411

(Commission File Number)

(I.R.S. Employer Identification Number)



 

8390 East Crescent Parkway, Suite 650
Greenwood Village, Colorado

 

80111

(Address of principal executive offices)

(Zip Code)



Registrant’s telephone number, including area code: (303) 770-8300

____________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:



 



 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:



 

 

Title of each class

Trading Symbol

Name of each exchange on which registered

Common stock, par value $0.01 per share

CCS

NYSE

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933, as amended, or Rule 12b-2 of the Securities Exchange Act of 1934, as amended.



Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 




 



Item 2.02.  Results of Operations and Financial Condition

On July 30, 2019, Century Communities, Inc. (the “Company”) issued a press release announcing its results of operations and financial condition as of and for the three and six months ended June 30, 2019.  The full text of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this Current Report on Form 8-K (including Exhibit 99.1) is being “furnished” in accordance with General Instruction B.2 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall such information be incorporated by reference into any registration statement or any other document filed pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as expressly set forth by specific reference in such filing.

As discussed therein, the press release furnished as Exhibit 99.1 to this Current Report on Form 8-K contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act and, as such, may involve known and unknown risks, uncertainties and assumptions.  These forward-looking statements relate to the Company’s current expectations and are subject to the limitations and qualifications set forth in the press release as well as in the Company’s other documents filed with the U.S. Securities and Exchange Commission, including, without limitation, that actual events and/or results may differ materially from those projected in such forward-looking statements.

Item 9.01.   Financial Statements and Exhibits

(d) Exhibits



EXHIBIT INDEX



 

 



 

 

Exhibit No.

 

Description



 

99.1

 

Press release, dated July 30, 2019, announcing Century Communities, Inc.’s results of operations and financial condition as of and for the three and six months ended June 30, 2019.


 



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: July 30, 2019CENTURY COMMUNITIES, INC.





 

By:

/s/ David Messenger



David Messenger

 

Chief Financial Officer



 


(Back To Top)

Section 2: EX-99.1 (EX-99.1)

CCS 06.30.2019 Earnings Release 8-K Exhibit 99.1





Picture 8





Century Communities Reports Second Quarter 2019 Results

-  Home Deliveries Grew 42% to 1,967 Homes  -

- Net New Homes Contracts Increased 41% to a Record 2,182 Homes  -

- Home Sales Revenues Increased 17% to $608.6 Million  -

- Issued $500 million 8 year 6.75% senior unsecured notes -

-  Increased 2019 Outlook for Revenue and Deliveries -



Greenwood Village, Colorado (July 30, 2019) – Century Communities, Inc. (NYSE: CCS), a leading national homebuilder, today announced financial results for its second quarter ended June  30, 2019.

Second Quarter 2019 Highlights

·

Adjusted net income of $23.6 million, or $0.77 per diluted share and net income of $15.5 million, or $0.51 per diluted share

·

Home sales revenues increased 17% to a second quarter record $608.6 million

·

Selling, general & administrative expense (“SG&A”) as a percent of home sales revenues of 12.4%

·

Home deliveries grew 42% to a second quarter record 1,967 homes

·

Net new home contracts increased 41% to a record 2,182 homes

·

Homes in backlog of 2,591 with a value of $784.2 million

·

Completed an offering of $500 million of 6.75% Senior Unsecured Notes due 2027 and extinguished $385 million of 6.875% Senior Unsecured Notes due 2022

·

Stockholders’ equity grew 12% to a record $897 million



Dale Francescon, Co-Chief Executive Officer, stated, “As the second quarter progressed, we experienced meaningful improvement in new contracts as lower interest rates and better affordability,  a trend which has continued into July, bolstered buyer activity across nearly all markets within our national platform. We  remain committed to driving further efficiencies throughout our operations and continuing to invest in attractive land opportunities to deepen our presence in existing markets. Our solid performance year-to-date combined with housing market momentum leaves us well situated to achieve our 2019 growth objectives.”



Rob Francescon, Co-Chief Executive Officer, said, “We are encouraged by the recent uptick in buyer traffic which resulted in a record 2,182 net new home contracts.  During the quarter we opened new communities with appealing designs and amenities across all of our regions with a continued emphasis on the entry level price points. In our asset-light, Wade Jurney Homes business we experienced strong momentum during the quarter and expanded operations into Iowa and Michigan which represent the 16th and 17th states in our diversified footprint. With our strong balance sheet, attractive land positions and Wade Jurney Homes integration progressing as planned, we are pleased with the position of our Company.”



Second Quarter 2019 Results

Home sales revenues for the second quarter 2019 increased 17% to a second quarter record $608.6 million, compared to $522.2 million for the prior year quarter. The growth in home sales revenues was primarily attributable to a 42% increase in home deliveries to a second quarter record 1,967 homes compared to 1,384 homes for the prior year quarter. Average sales price of home deliveries for the second quarter 2019 was $309,400, compared to $377,300 in the prior year quarter, consistent with the Company’s expansion of its offering of lower priced homes.


 

Net new home contracts in the second quarter 2019 increased 41% to a record 2,182 homes, compared to 1,543 homes in the prior year quarter. At the end of the second quarter 2019, the Company had 2,591 homes in backlog, with a value of $784.2 million.

Adjusted net income for the first quarter was $23.6 million, or $0.77 per diluted share, as compared to $36.5 million, or $1.21 per diluted share, for the prior year quarter. Adjusted net income excludes the impact of one-time items associated with a  debt refinancing and homebuilder acquisitions. Net income for the second quarter 2019 was $15.5 million, or $0.51 per diluted share as compared to $33.2 million or $1.10 per diluted share for the prior year quarter. The year over year difference in net income was primarily attributable to one-time non-operational items: a loss on debt extinguishment in the current period and a gain on the acquisition of Wade Jurney Homes in the prior year period.

Adjusted homebuilding gross margin percentage, excluding interest and purchase price accounting, was 19.6% in the second quarter 2019, as compared to 22.3% in the prior year quarter, which benefitted from a  particularly favorable product mix. Homebuilding gross margin percentage in the second quarter 2019 was 17.2%, as compared to 18.2% in the prior year quarter, largely attributable to product mix and higher incentives, primarily on homes sold in the prior two quarters when incentives were at their highest.  SG&A as a percent of home sales revenues was 12.4%, compared to 12.2% in the prior year quarter, due to relocation and integration costs related to Wade Jurney Homes and certain litigation settlements.

Financial services generated pre-tax income of $2.2 million in the second quarter 2019 as compared to $2.6 million in the prior year quarter due to reduced gains on sales of loans as a result of a declining interest rate environment. 



Balance Sheet and Liquidity



During the second quarter of 2019, the Company completed an offering of $500 million in aggregate principal of 6.750% Senior Notes due 2027.  In connection with this offering, the $385 million 6.875% Senior Notes due 2022 were extinguished and incurred approximately $10.8 million as a result of the associated call premium, tender costs and write-off of unamortized issuance costs.

 

As of June 30, 2019, the Company had total assets of $2.4 billion, including cash of $57.5 million and inventories of $2.0 billion. Liabilities totaled $1.5 billion, which included $1.1 billion of long-term debt. As of June 30, 2019, the Company had a record $897 million of stockholders’ equity, a 12% increase over the prior year quarter, and $428 million of capacity under its credit facility.



Full Year 2019 Outlook



David Messenger, Chief Financial Officer of the Company, commented, “Given our year-to-date over performance and continued confidence in our strategy, we are increasing our full year outlook for home deliveries to be in the range of 7,500 to 8,000 homes and our home sales revenues to be in the range of $2.3 billion to $2.5 billion.”



Conference Call



The Company will host a webcast and conference call on Tuesday,  July 30, 2019 at 5:00 p.m. Eastern time, 3:00 p.m. Mountain time, to review the Company’s second quarter 2019 results, discuss recent events and conduct a question-and-answer period. To participate in the call, please dial 877-451-6152 (domestic) or 201-389-0879 (international). The live webcast will be available at www.centurycommunities.com in the Investors section. A replay of the conference call will be available through August 30, 2019, by dialing 844-512-2921 (domestic) or 412-317-6671 (international) and entering the pass code 13692465. A replay of the webcast will be available on the Company’s website through August 30, 2019.




 

About Century Communities

Century Communities, Inc. (NYSE: CCS) is a top 10 national homebuilder. Century is engaged in all aspects of homebuilding, including the acquisition, entitlement and development of land, along with the construction, innovative marketing and sale of quality homes designed to appeal to a wide range of homebuyers. The Colorado-based Company sells its Century Communities and Wade Jurney Homes in 17 states across the U.S. and offers title, insurance and lending services in select markets through its Parkway Title, IHL Insurance Agency, and Inspire Home Loan subsidiaries. To learn more about Century Communities please visit www.centurycommunities.com.



Non-GAAP Financial Measures



In addition to the Company’s operating results presented in accordance with generally accepted accounting principles (GAAP), this press release includes the following non-GAAP financial measures: Adjusted Diluted Earnings per Common Share (Adjusted Diluted EPS), Adjusted Homebuilding Gross Margin, Adjusted EBITDA, and Ratio of Homebuilding Net Debt to Net Capital.  These non-GAAP financial measures should not be used as a substitute for the Company’s operating results presented in accordance with GAAP, and an analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP.  Please refer to the reconciliation of each of the above referenced non-GAAP financial measures following the historical financial information presented in this press release.



Forward-Looking Statements



This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, as such, may involve known and unknown risks, uncertainties and assumptions. Forward-looking statements may be identified by the use of words such as “anticipate,” “believe,” “expect,” “estimate,” “plan,” “continue,” “outlook,” and “project” and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Forward-looking statements in this release include the company’s operating and financial guidance for 2019.  Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on historical information available at the time the statements are made and are based on management’s reasonable belief or expectations with respect to future events, and are subject to risks and uncertainties, many of which are beyond the Company’s control, that could cause actual performance or results to differ materially from the belief or expectations expressed in or suggested by the forward-looking statements. The following important factors could cause actual results to differ materially from those expressed in the forward-looking statement: adverse changes in general economic conditions, ability to identify and acquire desirable land, availability of financing, the effect of interest rate and tax changes, reliance on contractors, and the other factors included in the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q.  Forward-looking statements speak only as of the date on which they are made and the Company undertakes no obligation to update any forward-looking statement to reflect future events, developments or otherwise, except as may be required by applicable law.  


 

Picture 7



Century Communities, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(in thousands, except share and per share amounts)





 



 

 

 

 

 

 

 

 

 

 

 

 



 

Three Months Ended June 30,

 

Six Months Ended June 30,



 

2019

 

2018

 

2019

 

2018

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Home sales revenues

 

$

608,636 

 

$

522,164 

 

$

1,131,938 

 

$

916,995 

Land sales and other revenues

 

 

1,399 

 

 

1,714 

 

 

2,754 

 

 

3,174 



 

 

610,035 

 

 

523,878 

 

 

1,134,692 

 

 

920,169 

Financial services revenue

 

 

9,915 

 

 

8,014 

 

 

18,315 

 

 

13,571 

Total revenues

 

 

619,950 

 

 

531,892 

 

 

1,153,007 

 

 

933,740 

Homebuilding Cost of Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Cost of home sales revenues

 

 

(503,928)

 

 

(427,197)

 

 

(937,685)

 

 

(746,780)

Cost of land sales and other revenues

 

 

(877)

 

 

(1,040)

 

 

(1,491)

 

 

(1,917)



 

 

(504,805)

 

 

(428,237)

 

 

(939,176)

 

 

(748,697)

Financial services costs

 

 

(7,747)

 

 

(5,385)

 

 

(14,576)

 

 

(9,781)

Selling, general, and administrative

 

 

(75,217)

 

 

(63,634)

 

 

(144,153)

 

 

(120,156)

Loss on debt extinguishment

 

 

(10,832)

 

 

 —

 

 

(10,832)

 

 

 —

Acquisition expense

 

 

 —

 

 

(165)

 

 

 —

 

 

(338)

Equity in income of unconsolidated subsidiaries

 

 

 —

 

 

11,681 

 

 

 —

 

 

14,849 

Other income (expense)

 

 

(519)

 

 

350 

 

 

(443)

 

 

(8)

Income before income tax expense

 

 

20,830 

 

 

46,502 

 

 

43,827 

 

 

69,609 

Income tax expense

 

 

(5,335)

 

 

(13,309)

 

 

(11,215)

 

 

(16,397)

Net income

 

$

15,495 

 

$

33,193 

 

$

32,612 

 

$

53,212 



 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.51 

 

$

1.11 

 

$

1.08 

 

$

1.79 

Diluted

 

$

0.51 

 

$

1.10 

 

$

1.07 

 

$

1.77 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

30,341,628 

 

 

29,901,791 

 

 

30,272,818 

 

 

29,709,728 

Diluted

 

 

30,568,848 

 

 

30,170,689 

 

 

30,506,945 

 

 

30,003,276 




 

Picture 6



Century Communities, Inc.

Condensed Consolidated Balance Sheets

 (in thousands, except share amounts)









 

 

 

 

 

 



 

June 30,

 

December 31,



 

2019

 

2018

Assets

 

(unaudited)

 

 

 

Cash and cash equivalents

 

$

31,704 

 

$

32,902 

Cash held in escrow

 

 

25,838 

 

 

24,344 

Accounts receivable

 

 

15,999 

 

 

13,464 

Inventories

 

 

2,009,769 

 

 

1,848,243 

Mortgage loans held for sale

 

 

122,085 

 

 

114,074 

Prepaid expenses and other assets

 

 

123,343 

 

 

138,717 

Property and equipment, net

 

 

33,469 

 

 

33,258 

Deferred tax assets, net

 

 

13,335 

 

 

13,763 

Amortizable intangible assets, net

 

 

4,436 

 

 

5,095 

Goodwill

 

 

30,395 

 

 

30,395 

Total assets

 

$

2,410,373 

 

$

2,254,255 

Liabilities and stockholders' equity

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

Accounts payable

 

$

97,043 

 

$

89,907 

Accrued expenses and other liabilities

 

 

212,750 

 

 

213,157 

Notes payable

 

 

890,606 

 

 

784,777 

Revolving line of credit

 

 

212,000 

 

 

202,500 

Mortgage repurchase facilities

 

 

100,745 

 

 

104,555 

Total liabilities

 

 

1,513,144 

 

 

1,394,896 

Stockholders' equity:

 

 

 

 

 

 

Preferred stock, $0.01 par value, 50,000,000 shares authorized, none outstanding

 

 

 —

 

 

 —

Common stock, $0.01 par value, 100,000,000 shares authorized, 30,438,505 and 30,154,791 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively

 

 

304 

 

 

302 

Additional paid-in capital

 

 

600,293 

 

 

595,037 

Retained earnings

 

 

296,632 

 

 

264,020 

Total stockholders' equity

 

 

897,229 

 

 

859,359 

Total liabilities and stockholders' equity

 

$

2,410,373 

 

$

2,254,255 






 

Picture 5



Century Communities, Inc.

Homebuilding Operational Data



Net New Home Contracts



 

 

 

 

 

 

 

 

 



 

Three Months Ended



 

June 30,



 

2019

 

 

2018

 

 

% Change

West

 

329 

 

 

186 

 

 

76.9 

%

Mountain

 

417 

 

 

460 

 

 

(9.3)

%

Texas

 

244 

 

 

194 

 

 

25.8 

%

Southeast

 

411 

 

 

559 

 

 

(26.5)

%

Wade Jurney Homes

 

781 

 

 

144 

 

 

NM

 

Total

 

2,182 

 

 

1,543 

 

 

41.4 

%



 

 

 

 

 

 

 

 

 



 

Six Months Ended



 

June 30,



 

2019

 

 

2018

 

 

% Change

West

 

532 

 

 

402 

 

 

32.3 

%

Mountain

 

871 

 

 

1,005 

 

 

(13.3)

%

Texas

 

473 

 

 

343 

 

 

37.9 

%

Southeast

 

756 

 

 

1,027 

 

 

(26.4)

%

Wade Jurney Homes

 

1,408 

 

 

144 

 

 

NM

 

Total

 

4,040 

 

 

2,921 

 

 

38.3 

%

NM – Not meaningful

Home Deliveries 



(dollars in thousands)



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

Three Months Ended June 30,

 

 

 

 

 

 



 

2019

 

2018

 

% Change

 



 

Homes

 

Average Sales Price

 

Homes

 

Average Sales Price

 

Homes

 

Average Sales Price

West

 

255 

 

$

529.9 

 

213 

 

$

606.8 

 

19.7 

%

 

(12.7)

%

Mountain

 

411 

 

 

433.9 

 

421 

 

 

425.4 

 

(2.4)

%

 

2.0 

%

Texas

 

213 

 

 

288.7 

 

206 

 

 

307.7 

 

3.4 

%

 

(6.2)

%

Southeast

 

360 

 

 

346.2 

 

379 

 

 

330.3 

 

(5.0)

%

 

4.8 

%

Wade Jurney Homes

 

728 

 

 

149.8 

 

165 

 

 

153.0 

 

NM

 

 

(2.1)

%

Total / Weighted Average

 

1,967 

 

$

309.4 

 

1,384 

 

$

377.3 

 

42.1 

%

 

(18.0)

%



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

Six Months Ended June 30,

 

 

 

 

 

 



 

2019

 

2018

 

% Change

 



 

Homes

 

Average Sales Price

 

Homes

 

Average Sales Price

 

Homes

 

Average Sales Price

West

 

455 

 

$

543.3 

 

413 

 

$

600.9 

 

10.2 

%

 

(9.6)

%

Mountain

 

778 

 

$

433.1 

 

764 

 

$

423.2 

 

1.8 

%

 

2.3 

%

Texas

 

379 

 

$

295.3 

 

314 

 

$

322.2 

 

20.7 

%

 

(8.3)

%

Southeast

 

695 

 

$

341.3 

 

669 

 

$

327.4 

 

3.9 

%

 

4.2 

%

Wade Jurney Homes

 

1,323 

 

$

150.1 

 

165 

 

$

153.0 

 

NM

 

 

(1.9)

%

Total / Weighted Average

 

3,630 

 

$

311.8 

 

2,325 

 

$

394.4 

 

56.1 

%

 

(20.9)

%

NM – Not meaningful


 

Picture 10 

Century Communities, Inc.

Homebuilding Operational Data





Selling Communities

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

Selling communities at period end

 

As of June 30,

 

 

Increase/(Decrease)



 

2019

 

2018

 

 

Amount

 

% Change



 

 

 

 

 

 

 

 

 

 

West

 

20 

 

12 

 

 

 

66.7 

%

Mountain

 

42 

 

31 

 

 

11 

 

35.5 

%

Texas

 

21 

 

24 

 

 

(3)

 

(12.5)

%

Southeast

 

42 

 

53 

 

 

(11)

 

(20.8)

%

Wade Jurney Homes

 

N/A

 

N/A

 

 

N/A

 

N/A

 

Total

 

125 

 

120 

 

 

 

4.2 

%

N/A – Not applicable



Backlog



(dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

As of June 30,

 

 

 

 

 

 

 

 

 



 

2019

 

2018

 

% Change

 



 

Homes

 

Dollar Value

 

Average Sales Price

 

Homes

 

Dollar Value

 

Average Sales Price

 

Homes

 

Dollar Value

 

Average Sales Price

West

 

295 

 

$

146,071 

 

$

495.2 

 

259 

 

$

150,619 

 

$

581.5 

 

13.9 

%

 

(3.0)

%

 

(14.8)

%

Mountain

 

494 

 

 

214,673 

 

$

434.6 

 

696 

 

 

307,825 

 

$

442.1 

 

(29.1)

%

 

(30.3)

%

 

(1.7)

%

Texas

 

275 

 

 

83,172 

 

$

302.4 

 

244 

 

 

88,458 

 

$

362.5 

 

12.7 

%

 

(6.0)

%

 

(16.6)

%

Southeast

 

531 

 

 

187,306 

 

$

352.7 

 

738 

 

 

242,378 

 

$

328.4 

 

(28.0)

%

 

(22.7)

%

 

7.4 

%

Wade Jurney Homes

 

996 

 

 

152,930 

 

$

153.5 

 

1,262 

 

 

197,973 

 

$

156.9 

 

(21.1)

%

 

(22.8)

%

 

(2.2)

%

Total / Weighted Average

 

2,591 

 

$

784,152 

 

$

302.6 

 

3,199 

 

$

987,253 

 

$

308.6 

 

(19.0)

%

 

(20.6)

%

 

(1.9)

%



Lot Inventory





 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

As of June 30,

 

 

 

 

 

 

 

 

 



 

2019

 

2018

 

% Change

 



 

 

 

 

 

 



 

Owned

 

Controlled

 

Total

 

Owned

 

Controlled

 

Total

 

Owned

 

Controlled

 

Total



 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

West

 

3,310 

 

1,846 

 

5,156 

 

3,790 

 

2,420 

 

6,210 

 

(12.7)

%

 

(23.7)

%

 

(17.0)

%

Mountain

 

5,011 

 

5,559 

 

10,570 

 

5,399 

 

4,851 

 

10,250 

 

(7.2)

%

 

14.6 

%

 

             3.1

%

Texas

 

3,829 

 

1,384 

 

5,213 

 

2,560 

 

3,201 

 

5,761 

 

49.6 

%

 

(56.8)

%

 

(9.5)

%

Southeast

 

4,730 

 

2,566 

 

7,296 

 

5,135 

 

4,460 

 

9,595 

 

(7.9)

%

 

(42.5)

%

 

(24.0)

%

Wade Jurney Homes

 

3,325 

 

5,633 

 

8,958 

 

2,472 

 

4,356 

 

6,828 

 

34.5 

%

 

29.3 

%

 

31.2 

%

Total

 

20,205 

 

16,988 

 

37,193 

 

19,356 

 

19,288 

 

38,644 

 

4.4 

%

 

(11.9)

%

 

(3.8)

%






 



Picture 2



Century Communities, Inc.

Reconciliation of Non-GAAP Financial Measures

(Unaudited)





Adjusted Diluted Earnings per Common Share (Adjusted Diluted EPS) is a non-GAAP financial measure that we believe is useful to management, investors and other users of the Company’s financial information in evaluating its operating results and understanding its operating trends without the effect of certain non-recurring items. The Company believes excluding certain non-recurring items provides more comparable assessment of its financial results from period to period. Adjusted Diluted EPS is calculated by excluding loss from debt extinguishment, the effect of acquisition costs and purchase price accounting for acquired work in process and gain on previously held interest in WJH, LLC from the calculation of reported EPS.

Adjusted Net Income and Adjusted Diluted Earnings Per Common Share

(in thousands, except share and per share amounts)







 

 

 

 

 

 

 

 

 

 

 

 



 

Three Months Ended

 

Six Months Ended



 

June 30,

 

June 30,



 

2019

 

2018

 

2019

 

2018

Numerator

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

15,495 

 

$

33,193 

 

$

32,612 

 

$

53,212 

Less: Undistributed earnings allocated to participating securities

 

 

 —

 

 

(3)

 

 

 —

 

 

(67)

Net income allocable to common stockholders

 

$

15,495 

 

$

33,190 

 

$

32,612 

 

$

53,145 

Denominator

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - basic

 

 

30,341,628 

 

 

29,901,791 

 

 

30,272,818 

 

 

29,709,728 

Dilutive effect of restricted stock units

 

 

227,220 

 

 

268,898 

 

 

234,127 

 

 

293,548 

Weighted average common shares outstanding - diluted

 

 

30,568,848 

 

 

30,170,689 

 

 

30,506,945 

 

 

30,003,276 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.51 

 

$

1.11 

 

$

1.08 

 

$

1.79 

Diluted

 

$

0.51 

 

$

1.10 

 

$

1.07 

 

$

1.77 



 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Earnings per share

 

 

 

 

 

 

 

 

 

 

 

 

Numerator

 

 

 

 

 

 

 

 

 

 

 

 

Income before income tax expense

 

$

20,830 

 

$

46,502 

 

$

43,827 

 

$

69,609 

Loss on debt extinguishment

 

 

10,832 

 

 

 —

 

 

10,832 

 

 

 —

Purchase price accounting for acquired work in process inventory

 

 

 —

 

 

9,163 

 

 

1,724 

 

 

16,433 

Gain on previously held interest in WJH

 

 

 —

 

 

(7,219)

 

 

 —

 

 

(7,219)

Acquisition expense

 

 

 —

 

 

165 

 

 

 —

 

 

338 

Adjusted income before income tax expense

 

 

31,662 

 

 

48,611 

 

 

56,383 

 

 

79,161 

Adjusted income tax expense(1)

 

 

(8,102)

 

 

(12,152)

 

 

(14,428)

 

 

(19,790)

Adjusted net income

 

 

23,560 

 

 

36,459 

 

 

41,955 

 

 

59,370 

Less: Adjusted undistributed earnings allocated to participating securities

 

 

 —

 

 

(3)

 

 

 —

 

 

(74)

Adjusted net income allocable to common stockholders

 

$

23,560 

 

$

36,456 

 

$

41,955 

 

$

59,296 



 

 

 

 

 

 

 

 

 

 

 

 

Denominator - Diluted

 

 

30,568,848 

 

 

30,170,689 

 

 

30,506,945 

 

 

30,003,276 



 

 

 

 

 

 

 

 

 

 

 

 

Adjusted diluted earnings per share

 

$

0.77 

 

$

1.21 

 

$

1.38 

 

$

1.98 



(1)

The tax rate used in calculating adjusted net income for the three and six months ended June 30, 2019 was our GAAP tax rate of 25.6%. For the three and six months ended June 30, 2018 the tax rate utilized was 25.0% which is reflective of the Company’s GAAP tax rate for the applicable period adjusted for certain discrete items.




 

Picture 9



Century Communities, Inc.

Reconciliation of Non-GAAP Financial Measures

(Unaudited)



Adjusted homebuilding gross margin excluding interest and purchase price accounting for acquired work in process inventory is not a measurement of financial performance under United States generally accepted accounting principles; however, the Company’s management believes that this information is meaningful as it isolates the impact that indebtedness and acquisitions have on homebuilding gross margin and permits the Company’s stockholders to make better comparisons with the Company’s competitors, who adjust gross margins in a similar fashion.  This non-GAAP financial measure should not be used as a substitute for the Company’s operating results.  An analysis of any non-GAAP financial measure should be used in conjunction with results presented in accordance with GAAP.



Adjusted Homebuilding Gross Margin

(in thousands)





 

 

 

 

 

 

 

 

 

 

 

 



 

Three Months Ended June 30,



 

 

 

 

 

 

 

 

 

 

 

 



 

2019

 

% 

 

2018

 

% 



 

 

 

 

 

 

 

 

 

 

 

 

Home sales revenues

 

$

608,636 

 

100.0 

%

 

$

522,164 

 

100.0 

%

Cost of home sales revenues

 

 

(503,928)

 

(82.8)

%

 

 

(427,197)

 

(81.8)

%

Gross margin from home sales

 

 

104,708 

 

17.2 

%

 

 

94,967 

 

18.2 

%

Add: Interest in cost of home sales revenues

 

 

14,655 

 

2.4 

%

 

 

12,284 

 

2.4 

%

Adjusted homebuilding gross margin excluding interest

 

 

119,363 

 

19.6 

%

 

 

107,251 

 

20.5 

%

Add: Purchase price accounting for acquired work in process inventory

 

 

 —

 

 —

%

 

 

9,163 

 

1.8 

%

Adjusted homebuilding gross margin excluding interest and purchase price accounting for acquired work in process inventory

 

$

119,363 

 

19.6 

%

 

$

116,414 

 

22.3 

%



 

 

 

 

 

 

 

 

 

 

 

 



 

 



 

Six Months Ended June 30,



 

 

 

 

 

 

 

 

 

 

 

 



 

2019

 

% 

 

2018

 

% 



 

 

 

 

 

 

 

 

 

 

 

 

Home sales revenues

 

$

1,131,938 

 

100.0 

%

 

$

916,995 

 

100.0 

%

Cost of home sales revenues

 

 

(937,685)

 

(82.8)

%

 

 

(746,780)

 

(81.4)

%

Gross margin from home sales

 

 

194,253 

 

17.2 

%

 

 

170,215 

 

18.6 

%

Add: Interest in cost of home sales revenues

 

 

27,241 

 

2.4 

%

 

 

21,243 

 

2.3 

%

Adjusted homebuilding gross margin excluding interest

 

 

221,494 

 

19.6 

%

 

 

191,458 

 

20.9 

%

Add: Purchase price accounting for acquired work in process inventory

 

 

1,724 

 

0.2 

%

 

 

16,433 

 

1.8 

%

Adjusted homebuilding gross margin excluding interest and purchase price accounting for acquired work in process inventory

 

$

223,218 

 

19.7 

%

 

$

207,891 

 

22.7 

%








 



Picture 1



Century Communities, Inc.

Reconciliation of Non-GAAP Financial Measures

(Unaudited)



Adjusted EBITDA



Adjusted EBITDA is a non-GAAP financial measure we use as a supplemental measure in evaluating operating performance. The Company defines adjusted EBITDA as consolidated net income before (i) income tax expense, (ii) interest in cost of home sales revenues, (iii) other interest expense, (iv) depreciation and amortization expense, (v) loss on debt extinguishment; and (vi) adjustments resulting from the application of purchase accounting for acquired work in process inventory related to business combinations. The Company believes adjusted EBITDA provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization, and items considered to be non-recurring. Accordingly, the Company’s management believes that this measurement is useful for comparing general operating performance from period to period. Adjusted EBITDA should be considered in addition to, and not as a substitute for, consolidated net income in accordance with GAAP as a measure of performance. The Company’s presentation of adjusted EBITDA should not be construed as an indication that its future results will be unaffected by unusual or non-recurring items. Adjusted EBITDA is limited as an analytical tool, and should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP.



(in thousands)









 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

Three Months Ended June 30,

 

Six Months Ended June 30,



 

2019

 

2018

 

% Change

 

2019

 

2018

 

% Change

Net income

 

$

15,495 

 

$

33,193 

 

 

(53.3)

%

 

$

32,612 

 

$

53,212 

 

 

(38.7)

%

Income tax expense

 

 

5,335 

 

 

13,309 

 

 

(59.9)

%

 

 

11,215 

 

 

16,397 

 

 

(31.6)

%

Interest in cost of home sales revenues

 

 

14,655 

 

 

12,284 

 

 

19.3 

%

 

 

27,241 

 

 

21,243 

 

 

28.2 

%

Interest expense (income)

 

 

 —

 

 

 —

 

 

N/M

 

 

 

15 

 

 

 

 

N/M

 

Depreciation and amortization expense

 

 

3,122 

 

 

2,786 

 

 

12.1 

%

 

 

6,196 

 

 

5,512 

 

 

12.4 

%

EBITDA

 

 

38,607 

 

 

61,572 

 

 

(37.3)

%

 

 

77,279 

 

 

96,365 

 

 

(19.8)

%

Loss on debt extinguishment

 

 

10,832 

 

 

 —

 

 

N/M

 

 

 

10,832 

 

 

 —

 

 

N/M

 

Purchase price accounting for acquired work in process inventory

 

 

 —

 

 

9,163 

 

 

(100.0)

%

 

 

1,724 

 

 

16,433 

 

 

(89.5)

%

Purchase price accounting for investment in unconsolidated subsidiaries outside basis

 

 

 —

 

 

30 

 

 

N/M

 

 

 

 —

 

 

60 

 

 

N/M

 

Acquisition expense

 

 

 —

 

 

165 

 

 

N/M

 

 

 

 —

 

 

338 

 

 

N/M

 

Adjusted EBITDA

 

$

49,439 

 

$

70,930 

 

 

(30.3)

%

 

$

89,835 

 

$

113,196 

 

 

(20.6)

%




 

Picture 4

Century Communities, Inc.

Reconciliation of Non-GAAP Financial Measures

(Unaudited)



Ratio of Net Homebuilding Debt to Net Capital

The following table presents the Company’s ratio of net homebuilding debt to net capital, which is a non-GAAP financial measure.  The Company calculates this by dividing net homebuilding debt (senior notes payable and revolving line of credit less cash held in escrow and cash and cash equivalents) by net capital (net homebuilding debt plus total stockholders’ equity). The most directly comparable GAAP measure is the ratio of debt to capital. The Company believes the ratio of net homebuilding debt to net capital is a relevant and useful financial measure to investors in understanding the leverage employed in its operations and as an indicator of the Company’s ability to obtain external financing. 

(in thousands)



 

 

 

 

 

 



 

June 30,

 

December 31,



 

2019

 

2018

Total homebuilding debt

 

$

1,102,606 

 

$

987,277 

Total stockholders' equity

 

 

897,229 

 

 

859,359 

Total capital

 

$

1,999,835 

 

$

1,846,636 

Debt to capital

 

 

55.1% 

 

 

53.5% 



 

 

 

 

 

 

Total homebuilding debt

 

$

1,102,606 

 

$

987,277 

Cash and cash equivalents

 

 

(31,704)

 

 

(32,902)

Cash held in escrow

 

 

(25,838)

 

 

(24,344)

Net homebuilding debt

 

 

1,045,064 

 

 

930,031 

Total stockholders' equity

 

 

897,229 

 

 

859,359 

Net capital

 

$

1,942,293 

 

$

1,789,390 



 

 

 

 

 

 

Net homebuilding debt to net capital

 

 

53.8% 

 

 

52.0% 







Contact Information:

Investor Relations:

303-268-8398

InvestorRelations@CenturyCommunities.com








(Back To Top)