[Q1 2024 Earnings Overview](index=1&type=section&id=Q1%202024%20Earnings%20Overview) Taylor Morrison's Q1 2024 performance was strong, with net income and diluted EPS stable, exceeding sales expectations and maintaining good gross margins, leading to an upward revision of full-year guidance [Executive Summary](index=1&type=section&id=Executive%20Summary) Taylor Morrison delivered a strong Q1 2024, with net income and diluted EPS consistent year-over-year, exceeding sales activity expectations and achieving good gross margins, leading to an upward revision of full-year guidance and highlighting diversified consumer and geographic strategies as foundational for sustained growth and profitability Q1 2024 Key Financial Metrics | Metric | Q1 2024 | Q1 2023 | Change | | :------------------- | :--------------- | :--------------- | :----- | | Net Income ($ Million) | $190 | $191 | -0.5% | | Diluted EPS ($) | $1.75 | $1.74 | +0.6% | | Home Closings | 2,731 | - | - | | Home Closings Gross Margin (%) | 24.0% | - | - | | Book Value Per Share Growth ($) | $50 | - | 14% | | Net Sales Orders Growth (%) | 29% | - | - | | Monthly Sales Pace Per Community | 3.7 | 2.9 | +27.6% | - The company raised its full-year guidance, expecting approximately **12,500 home deliveries**, with a home closings gross margin between **23.5% and 24.0%**, and an average closing price between **$600,000 and $610,000**[5](index=5&type=chunk) - A diversified consumer mix, from entry-level to resort lifestyle buyers, and geographic footprint underpin the company's strong performance, maximized by optimizing construction efficiency and gross margin opportunities[5](index=5&type=chunk) [Key Business Highlights](index=2&type=section&id=Key%20Business%20Highlights) This quarter, the company excelled in homebuilding, land portfolio, financial services, and balance sheet, achieving significant growth in home closings revenue and net sales orders, maintaining stable gross margins, and successfully enhancing liquidity and optimizing debt structure [Homebuilding Operations](index=2&type=section&id=Homebuilding%20Operations) Homebuilding operations saw growth in revenue and deliveries, a significant increase in net sales orders, and a notable decrease in cancellation rates in Q1, indicating improved market demand and enhanced operational efficiency Homebuilding Operations Key Metrics (Q1 2024 vs Q1 2023) | Metric | Q1 2024 | Q1 2023 | YoY Change | | :----------------------- | :--------------- | :--------------- | :------- | | Home Closings Revenue ($ Billion) | $1.6 | $1.6 | +2% | | Home Closings | 2,731 | - | +8% | | Average Closing Price ($) | $599,000 | - | -6% | | Home Closings Gross Margin (%) | 24.0% | 23.9% | +10 bps | | Net Sales Orders | 3,686 | - | +29% | | Monthly Sales Pace Per Community | 3.7 | 2.9 | +28% | | Number of Communities | 331 | - | +2% | | SG&A as % of Home Closings Revenue | 10.4% | 9.9% | +50 bps | | Cancellation Rate (%) | 7.0% | 14.0% | -7.0 pp | | Homes in Backlog | 6,244 | - | - | | Backlog Sales Value ($ Billion) | $4.2 | - | - | [Land Portfolio](index=2&type=section&id=Land%20Portfolio) The company increased land acquisition and development expenditures while maintaining an ample land supply, with controlled lots remaining stable, ensuring future homebuilding needs for several years Land Portfolio Key Metrics | Metric | Q1 2024 | Q1 2023 | YoY Change | | :------------------- | :--------------- | :--------------- | :------- | | Land Acquisition & Development Spend ($ Million) | $588 | $321 | +83% | | Development-Related Spend (%) | 38% | 68% | -30 pp | | Total Owned & Controlled Lots | 74,182 | 72,362 (End of 2023) | +2.5% | | Controlled Lots (%) | 53% | 53% (End of 2023) | 0 pp | | Total Supply (Years) | 6.5 | - | - | | Owned Land Supply (Years) | 3.1 | - | - | [Financial Services](index=2&type=section&id=Financial%20Services) Financial services saw an improved mortgage capture rate and strong borrower credit profiles, demonstrating the company's effectiveness in supporting homebuyers' financing needs Financial Services Key Metrics | Metric | Q1 2024 | Q1 2023 | YoY Change | | :------------------- | :--------------- | :--------------- | :------- | | Mortgage Capture Rate (%) | 87% | 82% | +5 pp | | Average Borrower FICO Score | 751 | - | - | | Average Borrower DTI Ratio (%) | 40% | - | - | [Balance Sheet & Liquidity](index=2&type=section&id=Balance%20Sheet%20%26%20Liquidity) The company maintained strong liquidity, achieved a credit rating upgrade, successfully reduced its total homebuilding debt to capitalization ratio, and actively repurchased shares, enhancing shareholder value Balance Sheet & Liquidity Key Metrics | Metric | Q1 2024 | Q1 2023 | YoY Change | | :----------------------- | :--------------- | :--------------- | :------- | | Total Liquidity ($ Billion) | $1.6 | - | - | | Unrestricted Cash ($ Million) | $554 | - | - | | Moody's Credit Rating | BA1 (Stable) | BA2 | Upgrade | | Total Homebuilding Debt to Capitalization Ratio (%) | 26.1% | 30.9% | -4.8 pp | | Net Homebuilding Debt to Capitalization Ratio (%) | 20.1% | 21.0% | -0.9 pp | | Share Repurchases (Million Shares) | 1.5 | - | - | | Share Repurchase Amount ($ Million) | $92 | - | - | | Remaining Share Repurchase Authorization ($ Million) | $403 | - | - | [Strategic Initiatives](index=3&type=section&id=Strategic%20Initiatives) Taylor Morrison expanded its geographic footprint by entering the Indianapolis market, acquiring approximately 1,500 lots to capitalize on local growth and affordability [Indianapolis Market Expansion](index=3&type=section&id=Indianapolis%20Market%20Expansion) Taylor Morrison entered the growing Indianapolis market by acquiring approximately 1,500 lots after Q1, further diversifying its geographic footprint and leveraging the area's job growth and affordability advantages - The company acquired approximately **1,500 lots** in Indianapolis, with nearly **55% controlled through options**, and the transaction was funded with cash on hand[10](index=10&type=chunk) - This expansion further diversifies Taylor Morrison's geographic footprint, entering a healthy market supported by **above-average job growth** and **affordability**[10](index=10&type=chunk) [Business Outlook](index=3&type=section&id=Business%20Outlook) Taylor Morrison provides guidance for Q2 and full-year 2024, projecting stable home deliveries, average closing prices, and gross margins, alongside planned share repurchases [Second Quarter 2024 Guidance](index=3&type=section&id=Second%20Quarter%202024%20Guidance) The company anticipates approximately 3,000 home deliveries in Q2 2024, maintaining healthy average closing prices and gross margins, and a stable number of communities Second Quarter 2024 Performance Guidance | Metric | Expected Value | | :------------------- | :------- | | Home Closings | Approx. 3,000 | | Average Closing Price | Approx. $605,000 | | Home Closings Gross Margin | At least 23.5% | | Ending Active Selling Communities | 330 to 340 | | Effective Tax Rate | Approx. 25% | | Diluted Share Count (Million Shares) | Approx. 108 | [Full Year 2024 Guidance](index=3&type=section&id=Full%20Year%202024%20Guidance) The company raised its full-year 2024 guidance, expecting increased home deliveries and average closing prices, stable gross margins, and plans for approximately $300 million in share repurchases Full Year 2024 Performance Guidance | Metric | Expected Value | | :----------------------- | :------- | | Home Closings | Approx. 12,500 | | Average Closing Price | $600,000 to $610,000 | | Home Closings Gross Margin | 23.5% to 24.0% | | Ending Active Selling Communities | 330 to 340 | | SG&A as % of Home Closings Revenue | High 9% range | | Effective Tax Rate | Approx. 25% | | Diluted Share Count (Million Shares) | Approx. 108 | | Land & Development Spend ($ Billion) | $2.3 to $2.5 | | Share Repurchases ($ Million) | Approx. $300 | [Corporate Information](index=4&type=section&id=Corporate%20Information) This section provides details on Taylor Morrison's Q1 earnings conference call and an overview of the company's profile as a leading national homebuilder [Earnings Conference Call](index=4&type=section&id=Earnings%20Conference%20Call) The company will host a public webcast on April 30, 2024, at 8:30 AM ET to discuss its Q1 earnings, with investors able to participate via the company website or conference call - The earnings conference call will be held on **April 30, 2024, at 8:30 AM ET**, accessible via the investor relations section of Taylor Morrison's website[15](index=15&type=chunk) - The dial-in number for the conference call is **(833) 470-1428**, with conference ID **544307**[15](index=15&type=chunk) [About Taylor Morrison](index=4&type=section&id=About%20Taylor%20Morrison) Taylor Morrison, headquartered in Scottsdale, Arizona, is a leading national homebuilder and developer serving a broad consumer base, consistently recognized as 'America's Most Trusted Home Builder' for multiple years - Taylor Morrison is headquartered in **Scottsdale, Arizona**, and is one of the leading homebuilders and developers in the United States[16](index=16&type=chunk) - The company serves first-time, move-up, and resort lifestyle homebuyers and renters, with brands including Taylor Morrison, Esplanade, Darling Homes Collection by Taylor Morrison, and Yardly[16](index=16&type=chunk) - From **2016 to 2024**, Taylor Morrison has been recognized as **'America's Most Trusted Home Builder'** by Lifestory Research[16](index=16&type=chunk) [Legal Disclosures](index=4&type=section&id=Legal%20Disclosures) This section outlines the nature of forward-looking statements within the report, emphasizing inherent risks and uncertainties that may cause actual results to differ materially from expectations [Forward-Looking Statements](index=4&type=section&id=Forward-Looking%20Statements) This earnings summary contains forward-looking statements subject to various risks, uncertainties, and other factors that could cause actual results to differ materially from expectations, with no obligation to update them unless required by applicable law - Forward-looking statements involve predictions, estimates, or expectations about future events, which may differ materially from actual results due to various risks and uncertainties such as inflation, changes in economic conditions, rising interest rates, labor shortages, and increased competition[17](index=17&type=chunk)[18](index=18&type=chunk) - The company undertakes no obligation to update any forward-looking statements unless required by applicable law[19](index=19&type=chunk) [Financial Statements & Supplementary Data](index=5&type=section&id=Financial%20Statements%20%26%20Supplementary%20Data) This section presents Taylor Morrison's consolidated statements of operations, condensed consolidated balance sheets, and detailed regional operational metrics for Q1 2024 [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) In Q1 2024, the company achieved growth in total revenue and gross profit, with net income remaining largely consistent year-over-year and diluted earnings per share slightly increasing Consolidated Statements of Operations (Q1 2024 vs Q1 2023) | (Thousands of Dollars) | March 31, 2024 | March 31, 2023 | | :--------------------------- | :------------- | :------------- | | Home Closings Revenue, Net | $1,636,255 | $1,612,595 | | Land Closings Revenue | 7,225 | 4,520 | | Financial Services Revenue | 46,959 | 35,149 | | Other Revenue | 9,313 | 9,593 | | **Total Revenue** | **1,699,752** | **1,661,857** | | Cost of Home Closings | 1,243,209 | 1,227,513 | | Cost of Land Closings | 5,202 | 4,345 | | Financial Services Expenses | 25,143 | 22,148 | | Other Expenses | 9,353 | 8,285 | | **Total Cost of Revenue** | **1,282,907** | **1,262,291** | | **Gross Profit** | **416,845** | **399,566** | | Selling, Commission & Other Marketing Expenses | 102,600 | 92,760 | | General & Administrative Expenses | 67,564 | 66,261 | | Net Income | $190,270 | $191,051 | | Diluted EPS ($) | $1.75 | $1.74 | [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2024, the company's total assets and total stockholders' equity increased, while cash and cash equivalents decreased, alongside an increase in real estate inventory and liabilities Condensed Consolidated Balance Sheets (March 31, 2024 vs December 31, 2023) | (Thousands of Dollars) | March 31, 2024 | December 31, 2023 | | :----------------------- | :------------- | :------------- | | **Assets** | | | | Cash & Cash Equivalents | $554,287 | $798,568 | | Total Real Estate Inventory | 5,985,353 | 5,545,446 | | Investments in Unconsolidated Entities | 369,982 | 346,192 | | **Total Assets** | **$8,910,343** | **$8,672,087** | | **Liabilities** | | | | Accounts Payable | $276,093 | $263,481 | | Customer Deposits | 357,657 | 326,087 | | Senior Notes, Net | 1,469,135 | 1,468,695 | | Loans & Other Borrowings | 441,190 | 394,943 | | **Total Liabilities** | **$3,484,175** | **$3,339,801** | | **Stockholders' Equity** | **5,426,168** | **5,332,286** | | **Total Liabilities & Stockholders' Equity** | **$8,910,343** | **$8,672,087** | [Regional Operational Metrics](index=7&type=section&id=Regional%20Operational%20Metrics) The company's regional operational data reveals strong performance in home closings and net sales orders in the West, while the East and Central regions experienced varying market dynamics [Homes Closed and Home Closings Revenue, Net by Region](index=7&type=section&id=Homes%20Closed%20and%20Home%20Closings%20Revenue%2C%20Net%20by%20Region) The Western region showed significant growth in home closings and revenue, while the Eastern region experienced a decline, and the Central region saw increased deliveries but a decreased average selling price Homes Closed and Home Closings Revenue, Net (by Region, Q1 2024 vs Q1 2023) | Region | 2024 Closings | 2023 Closings | Closings Change | 2024 Revenue ($ Thousand) | 2023 Revenue ($ Thousand) | Revenue Change | 2024 Avg. Price ($ Thousand) | 2023 Avg. Price ($ Thousand) | Avg. Price Change | | :--- | :----------- | :----------- | :--------- | :------------------- | :------------------- | :------- | :----------------------- | :----------------------- | :----------- | | East | 933 | 1,004 | (7.1)% | $541,730 | $601,611 | (10.0)% | $581 | $599 | (3.0%) | | Central | 832 | 731 | 13.8% | 472,032 | 463,394 | 1.9% | 567 | 634 | (10.6)% | | West | 966 | 806 | 19.9% | 622,493 | 547,590 | 13.7% | 644 | 679 | (5.2%) | | **Total** | **2,731** | **2,541** | **7.5%** | **$1,636,255** | **$1,612,595** | **1.5%** | **$599** | **$635** | **(5.7%)** | [Net Sales Orders by Region](index=7&type=section&id=Net%20Sales%20Orders%20by%20Region) Net sales orders grew across all regions, with the Central and Western regions showing the largest increases, indicating robust market demand Net Sales Orders (by Region, Q1 2024 vs Q1 2023) | Region | 2024 Orders | 2023 Orders | Orders Change | 2024 Sales Value ($ Thousand) | 2023 Sales Value ($ Thousand) | Sales Value Change | 2024 Avg. Price ($ Thousand) | 2023 Avg. Price ($ Thousand) | Avg. Price Change | | :--- | :----------- | :----------- | :--------- | :----------------------- | :----------------------- | :----------- | :----------------------- | :----------------------- | :----------- | | East | 1,295 | 1,079 | 20.0% | $776,861 | $644,519 | 20.5% | $600 | $597 | 0.5% | | Central | 904 | 674 | 34.1% | 478,419 | 384,830 | 24.3% | 529 | 571 | (7.4%) | | West | 1,487 | 1,101 | 35.1% | 984,483 | 756,344 | 30.2% | 662 | 687 | (3.6%) | | **Total** | **3,686** | **2,854** | **29.2%** | **$2,239,763** | **$1,785,693** | **25.4%** | **$608** | **$626** | **(2.9%)** | [Sales Order Backlog by Region](index=7&type=section&id=Sales%20Order%20Backlog%20by%20Region) As of the end of Q1, the company's total sales order backlog remained consistent year-over-year, though the Western region saw significant growth in backlog, while the Eastern and Central regions experienced declines Sales Order Backlog (by Region, Q1 2024 vs Q1 2023) | Region | 2024 Backlog Homes | 2023 Backlog Homes | Backlog Homes Change | 2024 Sales Value ($ Thousand) | 2023 Sales Value ($ Thousand) | Sales Value Change | 2024 Avg. Price ($ Thousand) | 2023 Avg. Price ($ Thousand) | Avg. Price Change | | :--- | :--------------- | :--------------- | :------------- | :----------------------- | :----------------------- | :----------- | :----------------------- | :----------------------- | :----------- | | East | 2,433 | 2,658 | (8.5)% | $1,715,398 | $1,775,970 | (3.4)% | $705 | $668 | 5.5% | | Central | 1,371 | 1,660 | (17.4)% | 870,550 | 1,132,928 | (23.2)% | 635 | 682 | (6.9)% | | West | 2,440 | 1,949 | 25.2% | 1,662,190 | 1,328,187 | 25.1% | 681 | 681 | — % | | **Total** | **6,244** | **6,267** | **(0.4)%** | **$4,248,138** | **$4,237,085** | **0.3%** | **$680** | **$676** | **0.6%** | [Ending Active Selling Communities by Region](index=7&type=section&id=Ending%20Active%20Selling%20Communities%20by%20Region) As of March 31, 2024, the company's total number of active selling communities slightly increased, with growth in the Eastern and Western regions and a slight decrease in the Central region Ending Active Selling Communities (by Region, March 31, 2024 vs March 31, 2023) | Region | March 31, 2024 | March 31, 2023 | Change | | :--- | :------------- | :------------- | :--- | | East | 113 | 106 | 6.6% | | Central | 93 | 98 | (5.1)% | | West | 125 | 120 | 4.2% | | **Total** | **331** | **324** | **2.2%** | [Non-GAAP Financial Measures Reconciliation](index=8&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation) This section provides reconciliations for non-GAAP financial measures, including adjusted net income, EBITDA, and debt to capitalization ratios, to offer a comprehensive view of the company's performance and leverage [Introduction to Non-GAAP Measures](index=8&type=section&id=Introduction%20to%20Non-GAAP%20Measures) The company provides non-GAAP financial measures such as adjusted net income, adjusted pre-tax income, adjusted home closings gross margin, EBITDA, adjusted EBITDA, and net homebuilding debt to capitalization ratio to supplement GAAP results, aiding investors in evaluating performance and leverage - Non-GAAP financial measures include **adjusted net income**, **adjusted pre-tax income**, **adjusted home closings gross margin**, **EBITDA** and **adjusted EBITDA**, and **net homebuilding debt to capitalization ratio**[28](index=28&type=chunk) - Management uses these non-GAAP metrics to assess overall and regional performance and set performance-based compensation targets, while the net homebuilding debt to total capitalization ratio serves as a measure of overall leverage and for comparison with industry peers[32](index=32&type=chunk) - These metrics are not separately presented as there were no adjustments in the current period that would cause adjusted net income, adjusted pre-tax income, or adjusted home closings gross margin to differ materially from comparable GAAP measures[35](index=35&type=chunk) [EBITDA and Adjusted EBITDA Reconciliation](index=9&type=section&id=EBITDA%20and%20Adjusted%20EBITDA%20Reconciliation) The company provides a reconciliation of EBITDA and Adjusted EBITDA, showing a slight decrease in these non-GAAP metrics in Q1 2024 compared to the prior year, yet maintaining a high percentage of total revenue EBITDA and Adjusted EBITDA Reconciliation (Q1 2024 vs Q1 2023) | (Thousands of Dollars) | March 31, 2024 | March 31, 2023 | | :----------------------------------- | :------------- | :------------- | | Net Income Attributable to Noncontrolling Interests | $191,161 | $191,228 | | Interest Income, Net | (43) | (1,111) | | Amortization of Capitalized Interest | 23,625 | 27,649 | | Income Tax Expense | 57,719 | 57,191 | | Depreciation & Amortization | 3,138 | 1,790 | | **EBITDA** | **$275,600** | **$276,747** | | Non-Cash Compensation Expense | 5,483 | 7,533 | | **Adjusted EBITDA** | **$281,083** | **$284,280** | | Adjusted EBITDA as % of Total Revenue | 16.5% | 17.1% | [Debt to Capitalization Ratios Reconciliation](index=9&type=section&id=Debt%20to%20Capitalization%20Ratios%20Reconciliation) The company provides a reconciliation of debt to capitalization ratios, indicating a decrease in both total homebuilding debt to capitalization and net homebuilding debt to capitalization ratios as of March 31, 2024, compared to the prior year, reflecting improved leverage Debt to Capitalization Ratios Reconciliation (March 31, 2024 vs December 31, 2023 vs March 31, 2023) | (Thousands of Dollars) | March 31, 2024 | December 31, 2023 | March 31, 2023 | | :--------------------------- | :------------- | :------------- | :------------- | | Total Debt | $2,093,499 | $2,017,102 | $2,301,878 | | Total Homebuilding Debt | $1,918,260 | $1,872,013 | $2,165,737 | | Total Stockholders' Equity | 5,426,168 | 5,332,286 | 4,846,546 | | Total Capitalization | $7,344,428 | $7,204,299 | $7,012,283 | | **Homebuilding Debt to Capitalization Ratio (%)** | **26.1%** | **26.0%** | **30.9%** | | Net Homebuilding Debt | $1,363,973 | $1,073,445 | $1,288,020 | | Total Capitalization | $6,790,141 | $6,405,731 | $6,134,566 | | **Net Homebuilding Debt to Capitalization Ratio (%)** | **20.1%** | **16.8%** | **21.0%** |

Company Performance and Strategy - Taylor Morrison Home Corporation (TMHC) has been named America's Most Trusted Homebuilder® for nine consecutive years[17]. - As of December 31, 2023, TMHC controlled 24% of its total homebuilding lots acquired in 2023, compared to 0% in 2022[33]. - The company had 3,225 quick-move-in homes in inventory as of December 31, 2023, up from 2,288 in 2022[51]. - TMHC's marketing strategy includes a robust online presence with tools such as an AI-enhanced chatbot and self-guided tours, aimed at improving customer experience[47]. - The company operates a "Build-to-Rent" business under the brand name Yardly, focusing on rental communities with innovative designs and smart home technology[41]. - TMHC's capital allocation strategy emphasizes disciplined land acquisition and community development to maximize long-term shareholder value[27]. - The company has increased its model homes from 216 as of December 31, 2022, to 352 by the end of 2023[49]. - In response to market dynamics, TMHC offered pricing incentives and discounts throughout 2023 to drive new sales[48]. - The company aims to balance sales pace and pricing on a community-by-community basis to maintain targeted sales volume[24]. - TMHC's long-term strategies include seeking growth opportunities through mergers, acquisitions, and organic growth into adjacent markets[29]. Market Conditions and Challenges - The company experienced seasonal variability in its quarterly results, with net homes sold ranging from 19% to 32% across different quarters in 2022 and 2023[59]. - Home closings revenue fluctuated between 21% and 30% across the same quarters, indicating a significant seasonal impact on financial performance[59]. - Income before income taxes varied from 17% to 31% across quarters, reflecting the cyclical nature of the homebuilding industry[59]. - The company operates in a highly competitive environment, contending with both large national builders and smaller local homebuilders for resources and market share[54]. - TMHF, the company's mortgage lending operation, competes with various mortgage lenders and has expanded its correspondent relationships to enhance stability in loan origination[61]. - The company emphasizes the importance of understanding competition in pricing and product strategies to maximize sales volumes and profitability[55]. - Regulatory compliance is critical, with various local, state, and federal regulations affecting construction, zoning, and environmental standards[67][69]. - The Federal Reserve increased interest rates 11 times in 2022 and 2023, leading to buyer apprehension and a rise in cancellation rates, which reached 12.1% for the year ended December 31, 2023, down from 13.5% in 2022[89][101]. - The company experienced a significant increase in cancellations during the second half of 2022 due to rising interest rates and affordability concerns, but pricing adjustments and incentives helped normalize cancellations in 2023[101][100]. - The availability of mortgage financing is critical, as a substantial majority of homebuyers finance their purchases through lenders, and fluctuations in credit availability can adversely affect sales[93][96]. - The company faced challenges with labor supply, leading to potential delays and increased costs in home construction, which could negatively impact operating results[97][99]. - Raw material shortages and price fluctuations, particularly in concrete, drywall, and lumber, have resulted in increased construction costs and delays in project timelines[103][105]. - Inflation has increased costs for land, materials, and labor, impacting margins and potentially making it difficult to raise home prices sufficiently[107]. - The company is exposed to changes in tax rules, which could adversely affect financial results, particularly if tax benefits associated with homeownership are reduced[90][92]. - A significant downturn in the housing market could lead to oversupply, increased cancellations, and aggressive price competition among homebuilders, adversely affecting revenues and cash flow[88]. - The company has adjusted pricing strategies, including offering financing incentives and home discounts, to mitigate the impacts of rising interest rates and improve sales orders[89][101]. - The liquidity provided by government-sponsored entities is crucial for the mortgage market, and any reduction in their support could adversely affect interest rates and mortgage availability[94]. - Competitive conditions in the homebuilding industry may lead to increased selling incentives, reduced prices, and an oversupply of homes, adversely affecting demand and operational results[112]. Operational Risks and Compliance - The company faces risks from reliance on subcontractors, which may expose it to liability and compliance issues with labor laws[128][129]. - The market value of land and housing inventories is subject to fluctuations, and a decline could result in impairments and write-downs, negatively impacting profitability[135][136]. - The company may incur significant costs from home warranty and construction defect claims, which could adversely affect financial results[124]. - Increased governmental focus on environmental, social, and governance (ESG) matters may raise compliance costs and impact operational results[121]. - The company’s ability to obtain performance, payment, and completion surety bonds is crucial for growth, and any inability to secure these could adversely affect operations[122][123]. - Seasonal fluctuations in quarterly operating results are influenced by factors such as home deliveries, land sales, and weather-related issues[116][117]. - A material decline in oil and gas prices could increase the risk of deflation, adversely impacting the company's business and financial results[109]. - The company may not be able to fully utilize certain deferred tax assets, which could result in substantial tax liabilities[137][138]. - The company has significant operations concentrated in the Western United States, particularly California, which increases the risk of revenue loss due to adverse regional factors[139]. - The company provided non-recourse carve-out guarantees to third-party lenders for its unconsolidated joint ventures, which may increase liability in case of defaults[142]. - The company may incur substantial costs related to compliance with evolving data privacy regulations, such as California's Proposition 24, which became effective on January 1, 2023[148]. - In 2023, the company paid $64.7 million due to a judgment related to the collection of club membership fees in Florida, highlighting potential litigation risks[162]. - The company faces risks associated with acquisitions, including potential dilution of existing stockholders and exposure to valuation risks during housing downturns[150]. - Environmental regulations may substantially increase operational costs and expose the company to potential liabilities related to contamination and climate change[163]. - Negative publicity or poor community relations could adversely affect sales and overall business performance[157]. - The company operates in a highly regulated environment, with potential delays and increased expenses due to legal challenges and compliance requirements[159]. - The company’s unconsolidated joint ventures may face operational challenges due to the lack of controlling interest, which could hinder decision-making and resource allocation[143]. Financial Position and Debt - The total principal amount of the company's debt as of December 31, 2023, was $2.0 billion, including $153.5 million of indebtedness from its financial services business[181]. - The company faces potential increases in construction costs due to new energy efficiency standards and regulations related to climate change, which could significantly impact profitability[166]. - Severe drought conditions in the Western United States may lead to restrictions on water usage for construction, increasing operational costs and complicating regulatory approvals for new developments[168]. - The company is exposed to risks associated with its financial services business, including the inability to sell originated mortgages in the secondary market, which could negatively affect liquidity and operations[170]. - Changes in governmental regulations regarding mortgage lending could adversely affect the financial results of the company's financial services segment, potentially leading to increased compliance costs[175]. - The discontinuation of LIBOR and transition to SOFR as a benchmark for interest payments could result in increased borrowing costs for the company[191]. - The company may face challenges in acquiring additional financing due to constricted capital markets, which could delay or abandon development and expansion plans[180]. - The company has established relationships with lenders that are crucial for its mortgage origination business; any deterioration in these relationships could lead to increased product prices and loss of customers[179]. - The company’s operations are heavily dependent on raw materials, and any burdens on suppliers from energy-related regulations could indirectly impact profitability[166]. - The company’s financial services operations may be subject to claims for losses associated with errors in loan representations, which could adversely affect financial performance[173]. Governance and Cybersecurity - The company has provisions in its charter and by-laws that may delay or prevent acquisition by a third party, potentially diminishing the value of its common stock[193]. - Under the existing debt agreements, a change of control would require a third-party acquirer to refinance outstanding indebtedness, and the company would need to repurchase Senior Notes at 101% of their principal amounts if a change of control occurs[197]. - The company maintains a comprehensive cybersecurity program, performing quarterly risk assessments to identify and remediate potential threats[202]. - Independent third parties are engaged semi-annually to assess the risks associated with the company's IT resources and information assets[203]. - The company has developed mitigation plans for material cybersecurity risks, which include implementing additional technology controls and increased training for personnel[204]. - The corporate headquarters is located in Scottsdale, Arizona, covering approximately 25,000 square feet, with the lease expiring in December 2027[215]. - The company has approximately 46 other leases for division offices and design centers[215]. - The Board of Directors receives biannual updates on the state of the cybersecurity program, including key risks and notable incidents[214]. - Management conducts quarterly cyber risk reviews and maintains a cybersecurity risk register to manage evolving threats[213]. - The company has provisions that could limit the price investors are willing to pay for shares, potentially deterring acquirers and reducing acquisition premiums[195].

Investor Presentation Fourth Quarter and Full Year 2023 At a Glance | --- | --- | --- | --- | |--------------------------------------------------|----------------------------|-------|--------------------| | | | | | | as of the fourth quarter 2023 | | | in 2023 | | 72,362 | $607,000 | | $7.4 billion | | homebuilding lots owned & controlled | average home closing price | | total revenue | | 6.3 years | 24.1% | | 11,495 | | total homebuilding lot supply (3.0 years owned) | home closings gross margin | | home c ...

Financial Data and Key Metrics Changes - In Q4 2023, the company delivered 11,495 homes, generating $7.2 billion in homebuilding revenue with an adjusted gross margin of 24% [14] - Adjusted earnings per diluted share were $7.54, with book value per share increasing by 15% year-over-year to $49 [14] - The company reported a net income of $223 million or $2.05 per diluted share for Q4, with a reported net income of $173 million or $1.58 per diluted share [57] Business Line Data and Key Metrics Changes - Net sales orders increased by 30% year-over-year in Q4, with a strong acceleration in December [27] - The entry-level segment accounted for 34% of net sales orders, while the move-up category represented 42% and resort lifestyle 24% [37] - The average closing price for homes in Q4 was $607,000, reflecting a shift towards more affordable products [62] Market Data and Key Metrics Changes - The company experienced a 29% increase in monthly absorption pace to 2.4 homes per community [65] - Cancellation rates decreased to 11.6% of gross orders, down from 24.4% a year ago, indicating strong demand [66] - The average credit score of buyers financed by the company was 751, with an average household income of nearly $180,000 [39] Company Strategy and Development Direction - The company aims to reaccelerate growth with a target of at least 12,000 home closings in 2024 and approximately 10% growth in 2025 [18] - A $1.8 billion land investment in 2023 supports growth aspirations, with planned land spending of $2.3 billion to $2.5 billion in 2024 [19] - The strategic shift towards larger self-developed communities is expected to enhance margins and improve long-term planning visibility [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating headwinds from rising interest rates and economic uncertainty, citing operational efficiency and a strong land portfolio [15][18] - The company anticipates continued modest pricing opportunities and a reduction in incentives as the market stabilizes [109] - Management highlighted the importance of diversification across buyer groups to mitigate risks and enhance growth potential [17] Other Important Information - The company generated $827 million in cash flow from operations in 2023, ending the year with approximately $1.8 billion in liquidity [70] - The net debt to capitalization ratio improved to 16.8%, down from 24% a year ago, reflecting a strong balance sheet [71] - The company has repurchased approximately $889 million in shares since 2020, reducing the diluted share count by over 30% [73] Q&A Session Questions and Answers Question: Can you elaborate on your gross margin guidance for Q1? - Management indicated that the guidance reflects a slight pullback in incentives, offset by operational efficiencies and cost management strategies [88] Question: How does the company view M&A opportunities in the current environment? - Management is focused on organic growth but remains open to strategic acquisitions that provide geographic or product benefits [90] Question: What is the reasoning behind the expected average selling price of $600,000 for 2024? - The expected price reflects a shift towards more affordable products, particularly in the entry-level segment, compared to the higher ASP in the backlog [92] Question: Can you discuss the company's land banking strategy and its cost? - Management noted that land banking remains an important option, with current costs being higher than previous deals, but expected to normalize [101][104] Question: What is the status of the Yardly single-family rental recognition? - Management stated that they are being prudent in bringing projects to market, with several deals in the pipeline for potential closure this year [132]

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR Commission File Number: 001-35873 TAYLOR MORRISON HOME CORPORATION (Exact name of registrant as specified in its Charter) (State or o ...

Investor Presentation Third Quarter 2023 At a Glance as of the third quarter 2023 year to date 2023 | --- | --- | --- | |--------------------------------------------------|----------------------------|--------------------| | | | | | 74,000 | $611,000 | $5.2 billion | | homebuilding lots owned & controlled | average home closing price | total revenue | | 6.1 years | 18.2% | 8,305 | | total homebuilding lot supply (3.5 years owned) | return on equity | home closings | | 325 | $1.6 billion | 2.9 | | active sel ...

Taylor Morrison Home Corporation (NYSE:TMHC) Q3 2023 Earnings Conference Call October 25, 2023 8:30 AM ET Company Participants Mackenzie Aron - Vice President, Investor Relations Sheryl Palmer - Chairman and CEO Curt VanHyfte - Chief Financial Officer Erik Heuser - Chief Corporate Operations Officer Conference Call Participants Carl Reichardt - BTIG Paul Przybylski - Wolfe Research Anika Dholakia - Barclays Doug Wardlaw - JPMorgan Alan Ratner - Zelman & Associates Ken Zener - Seaport Research Jay McCanless ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-35873 TAYLOR MORRISON HOME CORPORATION (Exact name of registrant as specified in its Charter) (State or other ...

Taylor Morrison Home Corporation (NYSE:TMHC) Q2 2023 Earnings Conference Call July 26, 2023 8:30 AM ET Company Participants Mackenzie Aron - VP, IR Sheryl Palmer - Chairman, President & CEO Erik Heuser - EVP & Chief Corporate Operations Officer Curt VanHyfte - West Area President & Interim CFO Conference Call Participants Michael Rehaut - JPMorgan Chase & Co. Carl Reichardt - BTIG Truman Patterson - Wolfe Research Elizabeth Langan - Barclays Bank Daniel Oppenheim - Crédit Suisse Alex Barrón - Housing Resear ...

Table of Contents (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-35873 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q TAYLOR MORRISON HOME CORPORATION (Exact name of registrant as specified in its Charter) (State or other ...