Financial Data and Key Metrics Changes - Net income attributable to Green Brick for Q2 2025 was $82 million, or $1.85 per diluted share, a decrease of 22% year over year [5][12] - Revenue for the quarter was virtually flat year over year at $547 million [6][11] - Homebuilding gross margins declined 410 basis points year over year to 30.4% [7][12] - Year-to-date net income decreased 16.8% to $157 million, and diluted earnings per share declined 15% to $3.52 [13] Business Line Data and Key Metrics Changes - Home closings increased by 6% year over year, totaling 1,042 homes [6] - Net new orders also increased by 6% year over year to 908, marking the highest for any second quarter in company history [6][12] - Average sales price declined by 5.3% year over year to $525,000 [11] - The average active selling communities remained relatively unchanged at approximately 102 [13] Market Data and Key Metrics Changes - Discounts and incentives increased as a percentage of residential unit revenue to 7.7% from 4.5% year over year [11] - The cancellation rate for the second quarter increased sequentially to 9.9% from 9.2% in the previous year [18] - The average FICO score for closed loans was 745, with a debt-to-income ratio of 38% [19][48] Company Strategy and Development Direction - The company is focused on maintaining an investment-grade balance sheet while navigating market volatility [8][15] - There is an emphasis on efficient cost controls, innovative home offerings, and targeted expansion in high-volume markets [8] - The expansion of the Trophy Signature Homes brand is a key strategic focus, with plans to enter the Houston market [9][22] Management's Comments on Operating Environment and Future Outlook - Management acknowledged ongoing affordability challenges due to high interest rates and decreasing consumer confidence [5][17] - The company remains optimistic about its ability to adapt to market conditions and maintain sales volumes [17][19] - Management believes that their investment-grade balance sheet provides a solid foundation for future growth [15][16] Other Important Information - The company returned $60 million of capital to shareholders through share repurchases, reducing outstanding shares by approximately 16% since 2022 [7] - The company plans to spend approximately $300 million on land development for the full year of 2025 [22] Q&A Session Summary Question: What is the incentive trajectory and expectations for July? - Management noted that incentives are currently around 8% and are seeing some leveling out, but conditions vary by neighborhood [26][27] Question: How much of the gross margin decline is due to price incentives versus mix? - Most of the gross margin decline was attributed to mortgage rate buy downs, with a small impact from mix [28][29] Question: What are the expectations for starts in the second half of the year? - Management indicated that starts will match sales, which have been consistent throughout the year [31][33] Question: How does the company view inventory levels today? - The company is focusing on finished homes, as buyers prefer to avoid uncertainty with mortgage rates [37] Question: What is the outlook on inventory levels among competitors? - Management observed little resale activity in their communities, indicating a stable demand for new homes [42][44]

Financial Performance - Home closings revenue remained unchanged year-over-year at $547 million[12, 13] - Closings increased by 56% year-over-year to 1,042 units, setting a company record[16, 17] - Homebuilding gross margins decreased by 410 bps year-over-year to 304%, but remained industry-leading[18, 20] - Net income was $819 million in Q2, resulting in a diluted EPS of $185[50] Orders and Backlog - Net new home orders increased by 62% year-over-year to 908, a record for any second quarter[28, 31] - Quarter-end backlog revenue was $516 million on 730 units[31] Land and Lot Position - Total lots owned and controlled increased by 207% year-over-year to 40,200, with 882% owned[33, 37] - The company invested $109 million in land acquisition and $139 million in land development year-to-date[37] - Land development spending in 2025 is expected to be approximately $300 million, a 46% increase from 2024[37] Financial Strength - The company ended the quarter with $112 million in cash and $365 million of capacity in revolving credit facilities[44] - The debt-to-total-capital ratio was 144%, the lowest level since 2015[50, 64]

PART I FINANCIAL INFORMATION [Condensed Consolidated Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents Green Brick Partners' unaudited condensed consolidated financial statements for Q2 and H1 2025, along with detailed notes [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets increased to $2.32 billion, driven by real estate inventory, while liabilities decreased and equity grew Condensed Consolidated Balance Sheets (in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total assets** | $2,315,269 | $2,249,994 | | Real estate inventory | $1,976,911 | $1,937,732 | | Cash and cash equivalents | $112,459 | $141,543 | | **Total liabilities** | $520,367 | $551,831 | | Senior unsecured notes, net | $274,281 | $299,090 | | **Total equity** | $1,748,935 | $1,653,454 | [Condensed Consolidated Statements of Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Q2 2025 revenues slightly decreased to $549.1 million, with net income at $81.9 million, while H1 2025 revenues increased to $1.05 billion, but net income declined to $157.0 million Financial Performance (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :--- | :--- | :--- | :--- | :--- | | **Total revenues** | $549,147 | $560,631 | $1,046,768 | $1,007,969 | | **Total gross profit** | $167,514 | $189,666 | $323,299 | $337,923 | | **Net income attributable to Green Brick** | $81,948 | $105,358 | $157,007 | $188,659 | | **Diluted EPS** | $1.85 | $2.32 | $3.52 | $4.14 | [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity) Stockholders' equity increased to $1.73 billion by June 30, 2025, driven by net income, partially offset by stock repurchases and dividends - For the six months ended June 30, 2025, the company recorded net income of **$157.0 million**, repurchased **$60.8 million** of its stock, and paid **$1.4 million** in dividends[12](index=12&type=chunk) - The company retired **1,027,678 shares** of treasury stock during the first six months of 2025[12](index=12&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations significantly increased to $143.5 million for H1 2025, while investing and financing activities resulted in a net cash decrease of $13.9 million Net Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $143,460 | $3,179 | | **Net cash (used in) provided by investing activities** | $(25,600) | $58,148 | | **Net cash used in financing activities** | $(131,763) | $(102,610) | | **Net decrease in cash** | $(13,903) | $(41,283) | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section details accounting policies and financial data, covering inventory, debt, equity, revenue recognition, segment performance, and subsequent events - Total inventory increased to **$1.98 billion** as of June 30, 2025, with no impairment charges recorded in 2025 or 2024[26](index=26&type=chunk) - On February 17, 2025, the Board authorized a new **$100.0 million** stock repurchase program, under which **1,027,678 shares** were repurchased for approximately **$60.1 million** during H1 2025[49](index=49&type=chunk)[51](index=51&type=chunk) - On July 4, 2025, the "One Big Beautiful Bill Act" (OBBBA) was signed into law, and the company is evaluating its financial statement impact[73](index=73&type=chunk)[93](index=93&type=chunk) Disaggregation of Revenue - Six Months Ended June 30, 2025 (in thousands) | Primary Geographical Market | Residential units revenue | Land and lots revenue | | :--- | :--- | :--- | | Central | $783,215 | $4,342 | | Southeast | $259,211 | $— | | **Total revenues** | **$1,042,426** | **$4,342** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance for Q2 and H1 2025, covering home deliveries, sales prices, gross margins, new orders, backlog, land sales, expenses, liquidity, and capital resources [Results of Operations](index=25&type=section&id=Results%20of%20Operations) Q2 2025 saw increased home deliveries but flat residential revenue due to lower average sales prices and decreased gross margins, with similar trends for H1 2025 Key Operating Metrics vs. Prior Year Period | Metric | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Home deliveries | +5.6% | +8.0% | | Home closings revenue | 0.0% | +5.3% | | Avg. sales price of homes delivered | -5.3% | -2.5% | | Net new home orders | +6.2% | +4.6% | | Homebuilding gross margin % | -410 bps | -320 bps | - The decrease in residential units gross margin for both periods is attributed to higher incentives, discounts, and closing costs[105](index=105&type=chunk)[116](index=116&type=chunk) - Backlog revenue decreased by **20.6%** year-over-year to **$516.2 million** as of June 30, 2025[101](index=101&type=chunk)[103](index=103&type=chunk) - The cancellation rate remained low, at **9.9%** for Q2 2025 and **7.9%** for the six months ended June 30, 2025[104](index=104&type=chunk)[115](index=115&type=chunk) [Lots Owned and Controlled](index=30&type=section&id=Lots%20Owned%20and%20Controlled) The company owned and controlled 40,200 lots as of June 30, 2025, with 88.2% owned and 98.4% self-developed, reflecting its land strategy Total Lots Owned and Controlled | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total lots owned | 35,468 | 32,716 | | Total lots controlled | 4,732 | 5,115 | | **Total lots owned and controlled** | **40,200** | **37,831** | - Self-developed lots represent **98.4%** of the total lots owned and controlled as of June 30, 2025[127](index=127&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with $112.5 million cash and low debt-to-capitalization ratios of 14.4% (gross) and 9.4% (net), sufficient for future operations and growth - As of June 30, 2025, the company had **$112.5 million** of unrestricted cash and cash equivalents[128](index=128&type=chunk) - The debt to total capitalization ratio was **14.4%** as of June 30, 2025, with a target of up to approximately **20%** for growth capital[131](index=131&type=chunk)[132](index=132&type=chunk) - The net debt to total capitalization ratio, a non-GAAP measure, was **9.4%** as of June 30, 2025[132](index=132&type=chunk)[147](index=147&type=chunk) - As of June 30, 2025, the company had no amounts outstanding under its **$35.0 million** Secured Revolving Credit Facility or its **$330.0 million** Unsecured Revolving Credit Facility[136](index=136&type=chunk)[137](index=137&type=chunk) - As of June 30, 2025, the company had earnest money deposits of **$10.2 million** at risk for contracts to purchase **3,221 lots** with an aggregate price of approximately **$217.7 million**[151](index=151&type=chunk) [Controls and Procedures](index=35&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[155](index=155&type=chunk) - No material changes were made to the company's internal control over financial reporting during the three months ended June 30, 2025[156](index=156&type=chunk) PART II OTHER INFORMATION [Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) This section highlights updated risk factors, including the adverse effects of tariffs on building material costs and home demand, and dependency on mortgage financing availability - The company identifies a risk that recently enacted and potential future tariffs could increase building product costs and adversely affect home demand and margins[157](index=157&type=chunk) - The U.S. Department of Commerce has indicated it will more than double duties on Canadian softwood lumber imports by September 2025, potentially increasing lumber costs[157](index=157&type=chunk) - Recent updates to residency requirements for FHA or VA insured mortgages, now limited to permanent U.S. residents, could adversely impact some homebuyers' ability to obtain financing[159](index=159&type=chunk)[160](index=160&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=36&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's common stock repurchases during Q2 2025, totaling 744,857 shares for $43.4 million under its $100 million repurchase plan Share Repurchases - Q2 2025 | Period | Total shares purchased | Average price paid per share | | :--- | :--- | :--- | | April 2025 | 384,857 | $55.97 | | May 2025 | 360,000 | $60.67 | | June 2025 | — | — | | **Total** | **744,857** | | - As of June 30, 2025, **$39.9 million** remained available for repurchase under the company's **$100 million** stock repurchase plan[161](index=161&type=chunk) [Other Information](index=36&type=section&id=Item%205.%20Other%20Information) This section reports no Rule 10b5-1 trading arrangement changes and details the employment agreement for Executive Vice President - Land, Bobby Samuel - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[162](index=162&type=chunk) - On May 12, 2025, the Company entered into a three-year employment agreement with Bobby Samuel, Executive Vice President - Land, with an annual base salary of **$500,000** and a target annual bonus of at least **$500,000**[163](index=163&type=chunk)[164](index=164&type=chunk) [Exhibits](index=37&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including employment agreements, CEO and CFO certifications, and XBRL data files - Exhibits filed include the employment agreement for Bobby L. Samuel III, Sarbanes-Oxley Act certifications from the CEO and CFO, and XBRL interactive data files[167](index=167&type=chunk)

[Financial & Operational Highlights](index=1&type=section&id=Financial%20%26%20Operational%20Highlights) Green Brick Partners achieved record Q2 2025 new home deliveries and net orders, maintaining a strong balance sheet despite lower net income and gross margin due to increased incentives and reduced average sales prices Q2 2025 Key Performance Indicators | Metric | Q2 2025 | YoY Change | | :--- | :--- | :--- | | New Homes Delivered | 1,042 | +5.6% | | Home Closings Revenue | $547 million | ~0% | | Homebuilding Gross Margin | 30.4% | -410 bps | | Diluted EPS | $1.85 | -20.3% | | Net New Home Orders | 908 | +6.2% | | Debt to Total Capital | 14.4% | N/A | - CEO Jim Brickman highlighted the strength of the company's land acquisition and self-development strategy as a key factor in its resilient performance amidst a challenging housing market[2](index=2&type=chunk) - Despite a 410 bps year-over-year decrease, the homebuilding gross margin of **30.4%** remained the highest in the public homebuilding industry and has exceeded **30%** for nine consecutive quarters[2](index=2&type=chunk) - Operationally, the company reduced average construction cycle times to under **5 months**, with Trophy brand homes averaging just **3.5 months**[2](index=2&type=chunk) - The company continued its capital return program, repurchasing approximately **$44 million** of common stock in Q2, bringing the year-to-date total to **$60 million**[2](index=2&type=chunk) [Financial Performance Analysis](index=1&type=section&id=Financial%20Performance%20Analysis) [Second Quarter 2025 Performance](index=1&type=section&id=Second%20Quarter%202025%20Performance) In Q2 2025, total revenues decreased to **$549.1 million** and net income fell to **$81.9 million**, resulting in a **20.3%** diluted EPS decline, primarily due to a **5.3%** lower average sales price and a **410 basis point** contraction in homebuilding gross margin Q2 Financial Performance (YoY Comparison) | (Dollars in thousands, except per share) | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues ($ thousands) | $549,147 | $560,631 | (2.0)% | | Total Gross Profit ($ thousands) | $167,514 | $189,666 | (11.7)% | | Net Income Attributable to GRBK ($ thousands) | $81,948 | $105,358 | (22.2)% | | Diluted EPS | $1.85 | $2.32 | (20.3)% | | Average Sales Price of Homes Delivered ($ thousands) | $525.1 | $554.2 | (5.3)% | | Homebuilding Gross Margin % | 30.4% | 34.5% | -410 bps | [Year-to-Date 2025 Performance](index=3&type=section&id=Year-to-Date%202025%20Performance) For the six months ended June 30, 2025, total revenues increased to **$1.05 billion**, but net income decreased by **16.8%** to **$157.0 million**, with diluted EPS falling **15.0%** due to a **320 basis point** decline in homebuilding gross margin Six Months Financial Performance (YoY Comparison) | (Dollars in thousands, except per share) | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues ($ thousands) | $1,046,768 | $1,007,969 | 3.8% | | Total Gross Profit ($ thousands) | $323,299 | $337,923 | (4.3)% | | Net Income Attributable to GRBK ($ thousands) | $157,007 | $188,659 | (16.8)% | | Diluted EPS | $3.52 | $4.14 | (15.0)% | | New Homes Delivered | 1,952 | 1,808 | 8.0% | | Homebuilding Gross Margin % | 30.8% | 34.0% | -320 bps | [Financial Statements](index=4&type=section&id=Financial%20Statements) [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) In Q2 2025, residential units revenue was **$547.1 million**, while land and lots revenue significantly declined to **$2.0 million**, resulting in total revenues of **$549.1 million** and net income of **$81.9 million** Consolidated Income Statement Summary (in thousands) | | Three Months Ended June 30, | Six Months Ended June 30, | | :--- | :--- | :--- | | | **2025** | **2025** | | **Total Revenues ($ thousands)** | **$549,147** | **$1,046,768** | | Residential units revenue ($ thousands) | $547,109 | $1,042,426 | | Land and lots revenue ($ thousands) | $2,038 | $4,342 | | **Total Gross Profit ($ thousands)** | **$167,514** | **$323,299** | | Income Before Income Taxes ($ thousands) | $112,288 | $218,436 | | **Net Income Attributable to GRBK ($ thousands)** | **$81,948** | **$157,007** | [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, Green Brick's total assets increased to **$2.32 billion**, driven by inventory growth, while total liabilities decreased to **$520.4 million**, and stockholders' equity grew to **$1.73 billion** Balance Sheet Summary (in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents ($ thousands) | $112,459 | $141,543 | | Total inventory ($ thousands) | $1,976,911 | $1,937,732 | | **Total Assets ($ thousands)** | **$2,315,269** | **$2,249,994** | | Total Liabilities ($ thousands) | $520,367 | $551,831 | | Total Green Brick Partners, Inc. stockholders' equity ($ thousands) | $1,725,373 | $1,625,415 | | **Total Liabilities and Equity ($ thousands)** | **$2,315,269** | **$2,249,994** | [Supplemental Information & Operational Metrics](index=6&type=section&id=Supplemental%20Information%20%26%20Operational%20Metrics) [Revenue and Deliveries Breakdown](index=6&type=section&id=Revenue%20and%20Deliveries%20Breakdown) In Q2 2025, home closings revenue remained stable at **$547.1 million** due to a **5.6%** increase in new homes delivered offset by a **5.3%** decrease in average sales price, while land and lots revenue declined **84.9%** to **$2.0 million** Q2 2025 Residential Units & Deliveries (YoY) | Metric | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | Change | | :--- | :--- | :--- | :--- | | Home closings revenue | $547,109 | $546,948 | —% | | New homes delivered | 1,042 | 987 | 5.6% | | Average sales price of homes delivered | $525.1 | $554.2 | (5.3)% | Q2 2025 Land and Lots Revenue (YoY) | Metric | Q2 2025 ($ thousands) | Q2 2024 ($ thousands) | Change | | :--- | :--- | :--- | :--- | | Land and lots revenue | $2,038 | $13,493 | (84.9)% | | Lots closed | 18 | 8 | 125.0% | [New Home Orders and Backlog](index=6&type=section&id=New%20Home%20Orders%20and%20Backlog) The company achieved a record **908** net new home orders in Q2 2025, a **6.2%** increase, despite a **6.4%** drop in average selling price and a slight rise in cancellation rate to **9.9%**, while backlog units and revenue decreased by **17.9%** and **20.6%** respectively Q2 2025 New Home Orders (YoY) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net new home orders | 908 | 855 | 6.2% | | Avg. selling price of new orders ($ thousands) | $516.7 | $551.8 | (6.4)% | | Cancellation rate | 9.9% | 9.2% | +0.7% | Backlog as of June 30, 2025 (YoY) | Metric | June 30, 2025 | June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Backlog units | 730 | 889 | (17.9)% | | Backlog revenue ($ thousands) | $516,183 | $650,349 | (20.6)% | | Avg. sales price of backlog ($ thousands) | $707.1 | $731.6 | (3.3)% | [Land Position](index=7&type=section&id=Land%20Position) As of June 30, 2025, Green Brick's total lots owned and controlled increased to **40,200**, with **98.4%** being self-developed and a significant concentration in the Central region, highlighting the company's land development focus Total Lots Owned and Controlled | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total lots owned | 35,468 | 32,716 | | Total lots controlled | 4,732 | 5,115 | | **Total lots owned and controlled** | **40,200** | **37,831** | - The company's land strategy emphasizes self-development, with self-developed lots accounting for **98.4%** of total lots owned and controlled as of June 30, 2025[18](index=18&type=chunk) [Non-GAAP Financial Measures](index=7&type=section&id=Non-GAAP%20Financial%20Measures) Green Brick uses non-GAAP measures like adjusted homebuilding gross margin (**30.9%**) and net debt to total capitalization (**9.4%**) to provide investors with a clearer view of its operational performance and strong financial structure - The company presents non-GAAP measures because it believes they are useful for management and investors in evaluating operating performance and financing structure, and facilitate comparison with industry peers[19](index=19&type=chunk) Q2 2025 Adjusted Homebuilding Gross Margin Reconciliation | (in thousands) | Amount | Percentage | | :--- | :--- | :--- | | Homebuilding gross margin (GAAP) ($ thousands) | $166,453 | 30.4% | | Add: Capitalized interest ($ thousands) | $2,605 | N/A | | **Adjusted homebuilding gross margin (Non-GAAP) ($ thousands)** | **$169,058** | **30.9%** | Net Debt to Total Capitalization Reconciliation (as of June 30, 2025) | (in thousands) | Amount | Ratio | | :--- | :--- | :--- | | Total debt, net ($ thousands) | $291,335 | | | Less: Cash and cash equivalents ($ thousands) | ($112,459) | | | **Net debt ($ thousands)** | **$178,876** | | | Total Green Brick Partners, Inc. stockholders' equity ($ thousands) | $1,725,373 | | | **Net capitalization ($ thousands)** | **$1,904,249** | | | Debt to total capitalization ratio (GAAP) | | 14.4% | | **Net debt to total capitalization ratio (Non-GAAP)** | | **9.4%** | [Corporate Information and Outlook](index=3&type=section&id=Corporate%20Information%20and%20Outlook) Green Brick Partners, a diversified homebuilder in Texas, Georgia, and Florida, will hold an earnings call on July 31, 2025, and anticipates **$300 million** in 2025 land development spending, while navigating market risks including interest rates, inflation, and supply chain costs - Green Brick is a diversified homebuilder with operations in Texas, Georgia, and Florida through five subsidiary builders and two joint ventures[22](index=22&type=chunk) - An earnings conference call to discuss Q2 2025 results is scheduled for **12:00 p.m. Eastern Time** on Thursday, July 31, 2025[6](index=6&type=chunk) - The company expects full-year 2025 land development spending to be approximately **$300 million**[2](index=2&type=chunk) - Forward-looking statements highlight potential risks including macroeconomic conditions (interest rates, inflation), supply chain costs, labor shortages, and the ability to acquire land at favorable prices[24](index=24&type=chunk)

Archer Aviation - Archer Aviation is focused on developing electric takeoff and landing vehicles (eVTOL) and aims to establish urban air taxi networks globally, despite currently having no measurable revenue [1][3] - The company is selling its Midnight eVTOL for $5 million, which raises concerns about the long payback period compared to competitors like Uber Technologies [2] - Archer's eVTOL can only carry four passengers, making its capacity comparable to conventional ride-sharing vehicles, which may limit its efficiency [3] - The current market capitalization of Archer Aviation stands at $5.5 billion, reflecting investor optimism despite the challenges faced [3] Innodata - Innodata is a small-cap stock benefiting from the artificial intelligence (AI) boom, specializing in data labeling and engineering for AI model training [6] - The company reported a 120% increase in revenue to $58.3 million in the first quarter, with adjusted EBITDA rising from $3.8 million to $12.7 million, driven by onboarding major new customers [7] - Innodata has a market cap of $1.6 billion and would need to increase by over 200% to match Archer's market cap, but it is well-positioned for growth [8] Green Brick Partners - Green Brick Partners has shown resilience in a challenging housing market, reporting an 11% revenue growth to $497.6 million in the first quarter, with a gross margin of 31.2% and a net income of $75 million [9] - The company differentiates itself by owning and developing lots in high-growth markets like Dallas and Atlanta, maintaining a low debt-to-capital ratio [10] - Green Brick's stock has increased over 400% in the last five years and trades at a price-to-earnings ratio of 7, indicating potential for further growth as housing demand is expected to improve [11][12]

Group 1 - Triba Research aims to identify high-quality businesses that can deliver sustainable, double-digit returns over the long term [1] - The firm's strategy focuses on companies with strong competitive advantages, operating in growing markets, maintaining low debt levels, and led by skilled management [1] - The firm is led by economist Tomas Riba, who has two decades of investment experience and seeks to generate alpha through a concentrated portfolio of 10 to 15 carefully selected securities [1]

Financial Data and Key Metrics Changes - Home closings revenue for Q1 2025 increased 11.8% year over year to $495 million, a record for any first quarter in company history [6][17] - Net income attributable to the company decreased 9.9% year over year to $75 million, with diluted EPS down 8.2% to $1.67 per share [7][19] - Book value grew 25% year over year to $37.09 per share [7] - Net new home orders increased 3.3% year over year to 1,106, setting a new company record [19] - Homebuilding gross margin was 31.2%, down 20 basis points year over year, but still the highest among public homebuilding peers [18] Business Line Data and Key Metrics Changes - Trophy brand represented 54% of total deliveries and 40% of total home closings revenue in Q1 2025 [18] - Average sales price (ASP) for new orders decreased 6.3% to $537,000, with Trophy representing a larger share of units [20] - Total homes under construction increased 2.8% to 2,296, with a decrease in the percentage of Beck homes under construction [21] Market Data and Key Metrics Changes - Approximately 80% of home closings revenue was generated from infill and infill adjacent submarkets [10] - The company maintained a low cancellation rate of 6.1%, the lowest among public homebuilding peers [21] - The average FICO score for homebuyers using the company's mortgage services was 741, with a debt-to-income ratio of 40% [29] Company Strategy and Development Direction - The company focuses on self-development and strategic land acquisition to avoid high costs associated with land banking [6][10] - The company plans to invest approximately $300 million in land development during the year, with a healthy land pipeline [30] - The company aims to expand its Trophy brand in Houston, the largest home building market in the U.S. [33] Management's Comments on Operating Environment and Future Outlook - Management acknowledged economic uncertainties impacting the market but expressed confidence in the company's core strengths to navigate challenges [8][15] - The company anticipates continued demand driven by household formation among millennials and Gen Z, despite a housing market undersupplied by an estimated 4 to 7 million units [15] - Management remains optimistic about long-term market fundamentals and the company's ability to outperform peers [34] Other Important Information - The company repurchased $38.3 million of its stock through April 2025, with a board authorization of $100 million for share buybacks [14] - The total debt to capital ratio stood at 14.5%, with net debt to total capital at 9.8%, indicating a strong balance sheet [22] Q&A Session Summary Question: What has been observed in April regarding tariffs and sales incentives? - Management noted minimal impact from tariffs so far, viewing them as a wildcard in the industry [37] - Sales incentives for the Trophy brand were in line with overall company incentives, with variations based on market location [39] Question: Are there signs of changes in the land market? - Management indicated some fluidity in the land market, with public builders walking away from less desirable lots [42] - The company is receiving offers for lots that are difficult to move in the current market [43] Question: How does the company decide on capital allocation between buybacks and land investments? - Management explained that stock repurchases can be lumpier due to ongoing complex land deals, which may affect timing [48] - The company is pursuing larger master plan communities that require significant capital deployment [50]

Financial Data and Key Metrics Changes - Home closings revenue for Q1 2025 increased 11.8% year over year to $495 million, a record for any first quarter in company history [6][15] - Net income attributable to the company decreased 9.9% year over year to $75 million, with diluted EPS down 8.2% to $1.67 per share [7][17] - Book value grew 25% year over year to $37.09 per share [7] - Net new home orders increased 3.3% year over year to 1,106, setting a new company record [17] - Total debt to capital ratio stood at 14.5% and net debt to total capital at 9.8%, both among the best in the public homebuilding sector [20][13] Business Line Data and Key Metrics Changes - Homebuilding gross margin was 31.2%, down 220 basis points year over year, primarily due to higher incentives [16] - Average sales price (ASP) for new orders decreased 6.3% to $537,000, with Trophy brand representing 54% of total deliveries [18] - Total homes under construction increased 2.8% to 2,296, with a decrease in the percentage of homes under construction from Trophy brand [19] Market Data and Key Metrics Changes - Approximately 80% of home closings revenue was generated from infill and infill adjacent submarkets [9] - The company noted that the housing market remains undersupplied by an estimated 4 to 7 million units [14][15] - The average FICO score for homebuyers using the company's mortgage services was 741, with a debt-to-income ratio of 40% [26] Company Strategy and Development Direction - The company focuses on self-development and avoiding high costs associated with land banking, which has allowed it to maintain gross margins above 30% [8][10] - The strategic approach includes investing in desirable locations and premium amenities to create lasting value in neighborhoods [10][12] - The company plans to continue growing its land pipeline by acquiring high-quality assets regardless of economic cycles [13][27] Management's Comments on Operating Environment and Future Outlook - Management acknowledged economic uncertainties impacting consumer confidence but expressed confidence in the company's core strengths to navigate challenges [8][14] - The company remains optimistic about long-term market fundamentals, driven by household formation among millennials and Gen Z [14][15] - Management highlighted the importance of maintaining affordability while avoiding a race to the bottom in pricing [12] Other Important Information - The company repurchased $38.3 million of its stock through April 2025, with a board authorization of $100 million for share buybacks [13] - The company plans to invest approximately $300 million in land development during the year [27][29] - The geographic footprint of the lot pipeline remains consistent, with approximately 92% in Texas [29] Q&A Session Summary Question: What has been observed in April regarding tariffs and sales incentives? - Management noted minimal impact from tariffs so far, with incentives for Trophy brand being in line with overall company incentives [34][35] Question: Are there any changes in the land market in Dallas? - Management indicated some fluidity in the land market, with public builders walking away from less desirable lots, leading to potential price drops [38][39] Question: How does the company decide on capital allocation between stock buybacks and land investments? - Management explained that stock repurchases can be lumpier due to ongoing large land deals, which may affect the timing of buybacks [44][45]

Forward Looking Statements This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Act of 1995. These statements concern expectations, beliefs, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts and typically include the words "anticipate," "believe," "consider," "estimate," "expect," "feel," "intend," "plan," "predict," "seek," "strategy," "target," "will" or other w ...

PART I FINANCIAL INFORMATION [Condensed Consolidated Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20%28Unaudited%29) The unaudited condensed consolidated financial statements for Q1 2025 indicate increased revenues and strong operating cash flow, despite a decline in net income [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets increased, primarily due to real estate inventory, while total liabilities decreased and total equity grew Balance Sheet Summary (in millions) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $103.0 | $141.5 | | Total real estate inventory | $1,986.5 | $1,937.7 | | **Total assets** | **$2,273.3** | **$2,250.0** | | **Liabilities & Equity** | | | | Borrowings on lines of credit, net | $(1.6) | $22.6 | | Senior unsecured notes, net | $274.2 | $299.1 | | **Total liabilities** | **$515.3** | **$551.8** | | **Total equity** | **$1,713.4** | **$1,653.5** | [Condensed Consolidated Statements of Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) For Q1 2025, total revenues increased, but higher costs led to a smaller gross profit increase and a decline in net income and diluted EPS Income Statement Summary (in millions, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total revenues | $497.6 | $447.3 | | Total gross profit | $155.8 | $148.3 | | Income before income taxes | $106.1 | $115.6 | | Net income attributable to Green Brick Partners, Inc. | $75.1 | $83.3 | | Diluted EPS | $1.67 | $1.82 | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations significantly improved in Q1 2025, while cash was used in investing and financing activities for debt repayments and stock repurchases Cash Flow Summary (in millions) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $68.7 | $1.0 | | Net cash (used in) provided by investing activities | $(12.0) | $61.3 | | Net cash used in financing activities | $(81.6) | $(51.3) | | **Net (decrease) increase in cash** | **$(24.8)** | **$11.0** | [Notes to the Unaudited Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) The notes provide details on accounting policies, real estate inventory, debt, stock repurchases, revenue disaggregation by market, and segment performance - Real estate inventory increased to **$1.99 billion** as of March 31, 2025, with the majority in land and lots under development (**$1.28 billion**)[27](index=27&type=chunk)[28](index=28&type=chunk) - On February 17, 2025, the Board authorized a new **$100.0 million** stock repurchase program During Q1 2025, the company repurchased **282,821 shares** for approximately **$16.7 million**[51](index=51&type=chunk) - Revenue is primarily generated from the Central geographical market, which accounted for **$361.6 million** in residential units revenue in Q1 2025, compared to **$133.7 million** from the Southeast market[60](index=60&type=chunk) - The Builder Operations segment generated **$495.3 million** in revenue and **$165.6 million** in gross profit, significantly outweighing the Land Development segment's **$2.3 million** in revenue and **$1.1 million** in gross profit for Q1 2025[67](index=67&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes strong Q1 2025 operating results to strategic locations and reduced cycle times, despite a decline in homebuilding gross margin percentage [Results of Operations](index=23&type=section&id=Results%20of%20Operations) Residential units revenue increased in Q1 2025 due to higher deliveries, but gross margin declined, while SG&A expenses improved as a percentage of revenue Key Operating Metrics (Q1 2025 vs Q1 2024, in thousands) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Home closings revenue | $495,317 | $443,094 | +11.8% | | New homes delivered | 910 | 821 | +10.8% | | Net new home orders (units) | 1,106 | 1,071 | +3.3% | | Backlog revenue | $594,171 | $725,489 | -18.1% | | Residential units gross margin % | 31.2% | 33.4% | -2.2 p.p. | - The decrease in residential units gross margin was attributed to a combination of product mix and a focus on higher incentives and discounts to combat high interest rates[103](index=103&type=chunk)[104](index=104&type=chunk) - SG&A as a percentage of builder operations revenue decreased to **11.1%** from **11.4%** YoY due to better leveraging of overhead costs on higher revenues[106](index=106&type=chunk)[107](index=107&type=chunk) [Lots Owned and Controlled](index=26&type=section&id=Lots%20Owned%20and%20Controlled) As of March 31, 2025, the company increased its total owned and controlled lots, with the vast majority being owned and self-developed, reflecting its land strategy Lot Position Summary | Lot Category | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total lots owned | 34,720 | 32,716 | | Total lots controlled | 5,805 | 5,115 | | **Total lots owned and controlled** | **40,525** | **37,831** | [Liquidity and Capital Resources](index=26&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintained a strong liquidity position with low debt-to-total capitalization ratios, utilizing cash from operations and borrowings to fund debt repayments and operations - The company's debt to total capitalization ratio was **14.5%** as of March 31, 2025, with a non-GAAP net debt to total capitalization ratio of **9.8%**[121](index=121&type=chunk)[138](index=138&type=chunk) - In Q1 2025, cash used in financing activities totaled **$81.6 million**, primarily for repayments of senior unsecured notes (**$25.0 million**), net repayments of lines of credit (**$24.4 million**), and common stock repurchases (**$16.9 million**)[126](index=126&type=chunk) - The company was in compliance with all debt covenants as of March 31, 2025, including maintaining a minimum interest coverage ratio, a minimum tangible net worth, and a maximum debt to capitalization ratio[129](index=129&type=chunk)[131](index=131&type=chunk) [Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[146](index=146&type=chunk) - No changes in internal controls that have materially affected or are reasonably likely to materially affect internal control over financial reporting occurred during the three months ended March 31, 2025[147](index=147&type=chunk) PART II OTHER INFORMATION [Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) The company highlights material changes to risk factors, including potential cost increases from tariffs and reduced home demand due to changes in mortgage financing requirements - The company faces risks from tariffs on imported goods and potential new duties on Canadian softwood lumber, which could increase home production costs and adversely impact margins[148](index=148&type=chunk) - Changes to mortgage financing, such as updated residency requirements for FHA/VA loans that exclude non-permanent residents, could reduce the pool of eligible homebuyers and negatively affect sales[149](index=149&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=33&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The Board authorized a new stock repurchase program, under which the company repurchased shares in Q1 2025, with a significant amount remaining for future repurchases Share Repurchases in Q1 2025 | Period | Total Shares Purchased | Average Price Paid | Value of Shares Remaining for Repurchase (in millions) | | :--- | :--- | :--- | :--- | | March 1 - March 31, 2025 | 282,821 | $59.23 | $83.3 | [Other Information](index=33&type=section&id=Item%205.%20Other%20Information) The company disclosed compensation updates, including a new Long-Term Incentive Plan, amendments to the Annual Incentive Plan, and increased compensation for the Interim CFO - A new Long-Term Incentive Plan (LTIP) was adopted on March 1, 2025, for executive officers, tying compensation to Total Shareholder Return (TSR) and Return on Assets (ROA) over a three-year period[152](index=152&type=chunk) - The Annual Incentive Plan (AIP) was amended on February 12, 2025, to remove EPS Performance as a metric[153](index=153&type=chunk) - Effective March 17, 2025, Interim CFO Jeffery Cox's base salary was increased to **$500,000**, and he became eligible for AIP and LTIP awards[154](index=154&type=chunk)[155](index=155&type=chunk) [Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files [Signatures](index=35&type=section&id=Signatures) The report is duly signed by the Chief Executive Officer and Interim Chief Financial Officer on behalf of Green Brick Partners, Inc