Company Overview - Legacy Housing Corporation builds, sells, and finances manufactured homes and tiny houses through a network of independent retailers and company-owned stores [3] - The company is one of the largest producers of manufactured homes in the United States, with operations primarily focused in the southern United States [3] - Legacy offers a variety of homes ranging from approximately 395 to 2,667 square feet, consisting of 1 to 5 bedrooms and 1 to 3.5 bathrooms, with retail prices ranging from approximately $33,000 to $180,000 [3] Financial Results Announcement - Legacy Housing Corporation will release its financial results for the full year ended December 31, 2024, after markets close on March 12, 2025 [1] - A conference call to discuss the financial results will be held on March 13, 2025, at 10:00 a.m. Central Time [1] - Interested parties can pre-register for the conference call to receive dial-in details [1] Investor and Media Inquiries - Investor inquiries can be directed to Duncan Bates at (817) 799-4837 or via email at duncanbates@legacyhousingcorp.com [4] - Media inquiries can be directed to Kira Hovancik at (817) 799-4905 or via email at pr@legacyhousingcorp.com [4]

Group 1 - The article discusses the performance and outlook of Legacy Housing Corp. (NASDAQ: LEGH) within the context of the housing industry, which is currently facing challenges [1] - The author has a long-term investment approach and has transitioned from being a Tech analyst to covering Commodities and Energy sectors, reflecting a broader interest in market dynamics [1] Group 2 - The housing industry is experiencing significant changes, and the article highlights the implications for companies like Legacy Housing Corp. [1]

Financial Results - Legacy Housing Corporation reported its financial results for the fiscal quarter ended September 30, 2024[2]. - The press release detailing the financial results was issued on November 12, 2024[2]. - The financial results press release is included as Exhibit 99.1 in the Current Report[4]. Company Information - The company is listed on the NASDAQ Global Market under the trading symbol LEGH[1]. - The registrant is not classified as an emerging growth company[2]. - The company's principal executive offices are located in Bedford, Texas[1]. - The company has an IRS Employer Identification Number of 20-2897516[1]. Report Details - The report is not intended to be filed under the Securities Exchange Act of 1934[3]. - The report was signed by Duncan Bates, President and CEO, on November 14, 2024[5]. - The report includes a cover page interactive data file formatted as Inline XBRL[4].

Financial Data and Key Metrics Changes - Product sales decreased by $6.8 million or 18.3% for Q3 2024 compared to Q3 2023, primarily due to a decrease in unit volume shipped in direct sales, mobile home park sales, and inventory finance sales [6][7] - Net income decreased by 1.8% to $15.8 million in Q3 2024 compared to Q3 2023, with basic earnings per share decreasing by $0.01 or 1.5% [13] - Gross profit margin was 29.2% for Q3 2024, down from 32.9% in Q3 2023, attributed to lower production levels and under-absorbed labor [10][20] Business Line Data and Key Metrics Changes - Consumer MHP and dealer loans interest income increased by $1.5 million or 17.3% in Q3 2024 compared to Q3 2023, driven by growth in loan portfolios [7] - Other revenue decreased by $0.4 million or 8.7% in Q3 2024 compared to Q3 2023, primarily due to a decrease in forfeited deposits and dealer finance fees [8] - Selling, general and administrative expenses remained flat compared to Q3 2023, with slight increases in payroll and healthcare expenses offset by decreases in warranty and bad debt expenses [11] Market Data and Key Metrics Changes - Applications for retail finance increased by 16% in Q3 2024 compared to Q3 2023, indicating a positive trend in market demand [18] - October 2024 retail finance funding reached the highest level since December 2020, suggesting a recovery in the market [18] - The community business is slowly improving, with more inbound requests expected to continue into 2025 [18] Company Strategy and Development Direction - The company is focusing on increasing production at its Texas plants and expanding its independent dealer network, particularly in South Texas, Florida, and the Carolinas [15][17] - The company is transitioning its community business by selling HUD tiny homes to RV park investors, viewing this as a growth opportunity [19] - Legacy Housing is also prioritizing land sales and development projects, with plans to sell lots in Bastrop County and Horseshoe Bay in 2025 [23][24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about production ramp-up in Q4 2024, expecting to see improved sales and backlog reduction following the successful fall show [29][30] - The company is monitoring material price fluctuations and labor market conditions, with expectations for gross margins to normalize as production increases [20][34] - Management noted that while high interest rates are currently depressing transaction volumes, they anticipate improvements in the community business in 2025 [18] Other Important Information - The company reported a one-time gain from a settlement agreement, which has now been fully integrated into the financials [36] - The company is operating two mobile home parks with a current occupancy rate of approximately 35%, with plans to increase occupancy before monetizing the assets [22][42] Q&A Session Summary Question: Expectations for production rates across plants for Q4 - Management expects to ramp up production in Q4, driven by strong orders from the fall show and new sales team management [29] Question: Trends in orders post-fall show - Orders have remained steady since the fall show, with an increase in inquiries from park customers [30][31] Question: Impact of hurricanes on operations - The company faced some delayed shipments but emerged from the storms without significant damage, anticipating future rebuild opportunities [32] Question: Normalization of gross margins - Management aims to return gross margins to the low 30s in Q4, contingent on improved production and labor conditions [34][41] Question: Status of the settlement agreement - The settlement agreement has been fully resolved, with ongoing opportunities to increase occupancy in the newly acquired parks [36][38]

Core Insights - Legacy Housing (LEGH) reported revenue of $44.27 million for Q3 2024, reflecting an 11.4% year-over-year decline and falling short of the Zacks Consensus Estimate of $51.14 million by 13.44% [1] - The company's EPS remained unchanged at $0.64 compared to the same period last year, but it missed the consensus EPS estimate of $0.65 by 1.54% [1] Revenue Breakdown - Net revenue from Consumer, MHP, and dealer loans interest was $10.33 million, exceeding the average estimate of $10.11 million by analysts, representing a year-over-year increase of 17.4% [3] - Net revenue from Other sources was reported at $3.77 million, significantly higher than the estimated $1.45 million, but showed a decline of 8.7% compared to the previous year [3] - Net revenue from Product sales was $30.17 million, which was below the estimated $39.58 million, marking an 18.5% decrease year-over-year [3] Stock Performance - Over the past month, Legacy Housing shares have returned +2%, while the Zacks S&P 500 composite increased by +3.3% [4] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [4]

Financial Performance - For the three months ended September 30, 2024, product sales decreased by $6.8 million, or 18.5%, compared to the same period in 2023, primarily due to a decrease in unit volumes shipped [134]. - Total net revenue for Q3 2024 was $44.3 million, a decrease of $5.7 million, or 11.4%, from $49.9 million in Q3 2023 [133]. - Net income for Q3 2024 was $15.8 million, a decrease of $285,000, or 1.8%, from $16.1 million in Q3 2023 [133]. - Total net revenue decreased by $25.4 million, or 16.4%, during the three months ended September 30, 2024, compared to the same period in 2023, primarily driven by a decrease in product sales [145]. - Product sales decreased by $29.9 million, or 24.4%, during the nine months ended September 30, 2024, due to a decrease in unit volumes shipped [146]. - Other revenue decreased by $1.4 million, or 17.5%, during the nine months ended September 30, 2024, primarily due to a decrease in dealer finance fees [150]. Sales and Production - The company sold 549 home sections in Q3 2024, down from 643 in Q3 2023, representing a decrease of 14.6% [121]. - The average net revenue per unit sold remained relatively stable at $63.5 in Q3 2024 compared to $63.6 in Q3 2023 [135]. - Approximately 48% of manufactured homes were sold in Texas for the nine months ended September 30, 2024, a slight decrease from 49% in the same period of 2023 [123]. - The company operates three manufacturing facilities and produces approximately 70 home sections per week, which translates to about 60 fully completed homes depending on product mix [122]. Expenses and Costs - The cost of product sales decreased by $20.1 million, or 24.1%, during the nine months ended September 30, 2024, primarily related to the decrease in units sold [151]. - Selling, general, and administrative expenses increased by $0.5 million, or 2.8%, during the nine months ended September 30, 2024, primarily due to increases in legal and marketing expenses [152]. - Inflation has impacted gross margins, with material and labor costs rising, and interest rate increases affecting financing availability for home buyers [129]. Cash Flow and Financing - Cash balances as of September 30, 2024, were approximately $0.6 million, a decrease from $0.7 million as of December 31, 2023 [157]. - The company believes that cash flow from operations and available credit will be sufficient to fund operations and growth for the next 12 to 18 months [156]. - Net cash provided by operating activities was $28.1 million for the nine months ended September 30, 2024, compared to a net cash outflow of $5.3 million for the same period in 2023, indicating a significant improvement [159]. - Net cash used in investing activities was $1.5 million for the nine months ended September 30, 2024, down from $7.6 million in the same period of 2023, primarily due to reduced loan issuances for manufactured housing parks [160]. - Net cash used in financing activities totaled $26.8 million for the nine months ended September 30, 2024, compared to a net cash inflow of $10.6 million in the same period of 2023, reflecting increased repayments on lines of credit and stock repurchases [161]. Share Repurchase and Credit Facilities - The company repurchased 262,530 shares for $5.4 million during the nine months ended September 30, 2024, with a remaining authorization of approximately $14.6 million for future repurchases [162]. - As of September 30, 2024, the outstanding balance of the new revolving credit facility was $2.1 million, with an interest rate of 7.61% [164]. - The company entered into a new Credit Agreement on July 28, 2023, providing a senior secured revolving credit facility with an initial commitment of $50 million [163]. - Interest expense under the new revolving credit facility was $686 thousand for the nine months ended September 30, 2024, compared to $588 thousand for the same period in 2023 [164]. Other Financial Metrics - The effective tax rate for the nine months ended September 30, 2024, was 18.2%, compared to 17.3% for the same period in 2023 [155]. - The maximum contingent obligations under repurchase agreements were approximately $856 thousand as of September 30, 2024, down from $3.0 million in December 31, 2023 [167]. - The company had a maximum leverage ratio of no more than 1.00 to 1.00 and a minimum fixed charge coverage ratio of no less than 1.75 to 1.00 as of September 30, 2024, indicating compliance with financial covenants [164]. - Cash at the end of the period was $570 thousand as of September 30, 2024, compared to $547 thousand at the end of the same period in 2023 [158]. - Other income increased by $7.1 million, or 296.7%, during the nine months ended September 30, 2024, driven by various gains including a reversal of accrued liabilities [154].

Core Viewpoint - Legacy Housing Corporation reported a decline in net revenue and income for the third quarter of 2024, while experiencing an increase in book value and book value per share, indicating mixed financial performance [2][3]. Financial Performance - Net revenue for Q3 2024 was $44.3 million, down 11.4% from Q3 2023 [2]. - Income from operations for Q3 2024 was $15.3 million, a decrease of 19.4% from Q3 2023 [2]. - Net income for Q3 2024 was $15.8 million, a decrease of 1.8% from Q3 2023 [2]. - Basic earnings per share for Q3 2024 were $0.65, down 1.5% from Q3 2023 [2]. - Book value for Q3 2024 was $479.3 million, an increase of 11.6% from Q3 2023 [2]. - Book value per share for Q3 2024 was $19.84, an increase of 12.7% from Q3 2023 [2][4]. Market and Strategic Initiatives - The company hosted a record number of customers at its 2024 Fall Show, showcasing updated home designs that appealed to younger buyers [3]. - Orders from the Fall Show increased the company's backlog into Q1 2025, suggesting positive market reception [3]. - The management believes that the market for manufactured homes will strengthen as housing affordability remains low [3]. Company Overview - Legacy Housing Corporation is the fourth largest producer of manufactured homes in the U.S., focusing on homes ranging from approximately 395 to 2,667 square feet and priced between $33,000 and $180,000 [6].

Core Viewpoint - Wall Street analysts anticipate Legacy Housing (LEGH) will report quarterly earnings of $0.65 per share, reflecting a year-over-year increase of 1.6%, with revenues expected to reach $51.14 million, up 2.4% from the previous year [1]. Group 1: Earnings and Revenue Estimates - Analysts project that 'Net revenue- Consumer and MHP loans interest' will likely reach $10.11 million, indicating a year-over-year increase of 14.9% [4]. - The 'Net revenue- Other' is estimated to be $1.45 million, showing a significant decline of 64.9% compared to the prior year [4]. - 'Net revenue- Product sales' is expected to reach $39.58 million, reflecting a year-over-year increase of 7% [4]. Group 2: Market Performance - Legacy Housing shares have shown a return of 5% over the past month, slightly outperforming the Zacks S&P 500 composite, which increased by 4.9% [5]. - The company holds a Zacks Rank 3 (Hold), suggesting it is expected to perform in line with the overall market in the near future [5].

For the quarter ended June 2024, Legacy Housing (LEGH) reported revenue of $42.5 million, down 19.3% over the same period last year. EPS came in at $0.65, compared to $0.60 in the year-ago quarter. The reported revenue represents a surprise of -8.31% over the Zacks Consensus Estimate of $46.35 million. With the consensus EPS estimate being $0.58, the EPS surprise was +12.07%. While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determin ...

Legacy Housing (LEGH) came out with quarterly earnings of $0.65 per share, beating the Zacks Consensus Estimate of $0.58 per share. This compares to earnings of $0.60 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of 12.07%. A quarter ago, it was expected that this mobile home manufacturing company would post earnings of $0.36 per share when it actually produced earnings of $0.60, delivering a surprise of 66.67%. Over the last ...