Taylor Morrison Home Corporation (NYSE:TMHC) Q2 2021 Earnings Conference Call July 29, 2021 8:30 AM ET Company Participants Mackenzie Aron - Vice President of Investor Relations Sheryl Palmer - Chairman and Chief Executive Officer Dave Cone - Executive Vice President and Chief Financial Officer Conference Call Participants Carl Reichardt - BTIG Ashley Kim - Barclays Paul Przybylski - Wolfe Research Jay McCanless - Wedbush Alex Rygiel - B. Riley Alan Ratner - Zelman & Associates Deepa Raghavan - Wells Fargo ...

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, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Delaware 83-2026677 (State or other jurisdiction of incorporation or organization) 4900 N. Scottsdale Road, Suite 2000 85251 Scottsdale, A ...

Financial Data and Key Metrics Changes - The company generated net income of $98 million or $0.75 per diluted share compared to a net loss of $31 million or $0.26 per diluted share in Q1 2020 [24] - Net sales orders increased 30% year-over-year to 4,492, the highest quarterly level in company history [24] - Monthly absorption pace increased 42% year-over-year to 4.3 net sales orders per community, also an all-time company high [24][25] - Ending backlog increased 54% year-over-year to 10,074 homes, representing a sales value of $5.3 billion [26] Business Line Data and Key Metrics Changes - The home closings gross margin was 18.6%, up 320 basis points from Q1 2020 [30] - The average community count was 345, with expectations to moderate to approximately 330 for the full year [28] - The production pace of 4.1 starts per community was up more than 70% year-over-year [22] Market Data and Key Metrics Changes - The central region, including Texas and Colorado, experienced the strongest year-over-year increase in monthly absorption pace [17] - Active adult segment drove the highest year-over-year gains in net sales orders and absorption pace [18] - The company reported a significant influx of homebuyers from California, with their share of Texas sales orders doubling pre-COVID levels [17] Company Strategy and Development Direction - The company aims to improve gross margins, increase asset efficiency, and optimize the balance sheet [8] - Expansion of the Esplanade brand into new markets, including California and North Carolina, is expected to enhance profitability [19] - The company is focused on maintaining a diverse mix of homebuyers while managing affordability risks [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued strength in consumer demand for housing, supported by historically low interest rates [13] - The company anticipates a significant ramp in deliveries in the second half of the year, driving full-year deliveries to the range of 14,500 to 15,000 [29] - Management acknowledged challenges in the supply chain, including labor shortages and material allocations, but expressed confidence in navigating these issues [73] Other Important Information - The company invested approximately $552 million in land acquisition and development in Q1 2021, up from $317 million in Q1 2020 [33] - The total liquidity at quarter-end was $1.1 billion, including $393 million in cash [36] - The company repurchased 1.4 million shares for $38 million, bringing cumulative repurchases to approximately $690 million since 2015 [37] Q&A Session Summary Question: Can you talk about your estimates around cost inflation and what assumptions on pricing and costs you're embedding in the gross margin guide? - Management indicated that cost increases for the rest of the year are expected to be around 400 basis points, with pricing expected to stay ahead of costs [44][45] Question: How do you expect the community count to change between different product types and geographies? - Management noted that there would not be a dramatic change in consumer groups, but some geographic shifts are occurring, particularly in Texas [49][51] Question: Can you discuss the land market and pricing trends? - Management observed erratic pricing in some markets but emphasized a disciplined approach to land acquisition, focusing on key locations [52][54] Question: Can you elaborate on the average order price increase and its impact on gross margin? - Management confirmed that the average order price increased by 18% year-over-year, with expectations for further pricing power in the back half of the year [56][60] Question: What are the expectations for G&A expense moving forward? - Management indicated that G&A expenses were impacted by timing and lower closings, but they expect to end the year in the mid-9% range [78] Question: How does the active adult expansion impact buyer types? - Management expects the active adult segment to grow in line with the rest of the business, maintaining a buyer mix of 15% to 20% [72][73]

Investor Presentation First Quarter 2021 TaylorMorrison. | --- | --- | --- | --- | --- | --- | --- | |-----------------------------------------------------------------------------------------------------------------------------------------------------------|-------|-------|-------|-------|-------|-------| | | | | | | | | | Headquartered in Scottsdale, Arizona, Taylor Morrison is a leading homebuilder and developer. | | | | | | | | We serve a broad array of consumers from coast to coast, including first-time ...

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 March 31, 2021 For the transition period from to Commission File Number: 001-35873 TAYLOR MORRISON HOME CORPORATION (Exact name of registrant as specified in its Charter) Delaware 83-2026677 (State or other jurisdiction of incorporation or organization) 4900 N. Scottsdale Road, S ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 or For the transition period from to . Commission File No. 001-35873 TAYLOR MORRISON HOME CORPORATION (Exact name of registrant as specified in its charter) Common Stock, $0.00001 par value TMHC New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: No ...

Taylor Morrison Home Corporation (NYSE:TMHC) Q4 2020 Earnings Conference Call February 10, 2021 8:30 AM ET Company Participants Mackenzie Aron – Vice President-Investor Relations Sheryl Palmer – Chairman and Chief Executive Officer Dave Cone – Executive Vice President and Chief Financial Officer Conference Call Participants Jack Micenko – SIG Carl Reichardt – BTIG Matthew Bouley – Barclays Ivy Zelman – Zelman & Associates Michael Rehaut – JP Morgan Jay McCanless – Wedbush Michael Dahl – RBC Capital Markets ...

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, 2020 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) Delaware 83 ...

Investor Presentation Third Quarter 2020 TaylorMorrison. H The Making of the Fifth Largest Homebuilder 2015 Sold Canadian operations Acquired JEH Homes (Atlanta) and three divisions of Orleans Homes (Charlotte, Raleigh and Chicago) 2016 Acquired Acadia Homes (Atlanta) 2018 Taylor Morrison became a fully floated public company following the exit of our former private equity owners Acquired AV Homes (NASDAQ: AVHI), adding scale to AZ, TX and Carolinas markets and entrance into Jacksonville 2019 Taylor Morriso ...

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Taylor Morrison Home Corporation, detailing financial performance and position impacted by the William Lyon Homes acquisition and COVID-19 as of June 30, 2020 [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet as of June 30, 2020, reflects a significant increase in total assets to **$8.3 billion** and total liabilities to **$4.9 billion**, primarily due to the William Lyon Homes acquisition Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $674,685 | $326,437 | | Total real estate inventory | $5,771,661 | $3,986,544 | | Goodwill | $637,440 | $149,428 | | **Total Assets** | **$8,322,334** | **$5,245,686** | | **Liabilities** | | | | Senior notes, net | $2,760,718 | $1,635,008 | | Revolving credit facility borrowings | $485,000 | $— | | **Total Liabilities** | **$4,897,594** | **$2,699,974** | | **Total Stockholders' Equity** | **$3,424,740** | **$2,545,712** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q2 2020, total revenue increased to **$1.53 billion**, but net income decreased to **$65.7 million** due to William Lyon Homes acquisition expenses and lower gross margins, with similar trends for the six-month period Key Operating Results (in thousands, except per share data) | Metric | Q2 2020 | Q2 2019 | YTD 2020 | YTD 2019 | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $1,526,685 | $1,265,426 | $2,872,384 | $2,190,518 | | Gross Margin | $244,178 | $233,774 | $441,934 | $405,814 | | Transaction Expenses | $18,712 | $1,750 | $105,086 | $5,879 | | Net Income Available to TMHC | $65,674 | $81,851 | $34,242 | $132,982 | | Diluted EPS | $0.50 | $0.76 | $0.27 | $1.21 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2020, net cash provided by operating activities significantly improved to **$323.2 million**, while investing activities used **$278.8 million** primarily for the William Lyon Homes acquisition, resulting in a net cash increase of **$348.3 million** Cash Flow Summary for the Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2020 | 2019 | | :--- | :--- | :--- | | Net cash provided by operating activities | $323,204 | $145,674 | | Net cash used in investing activities | ($278,788) | ($1,440) | | Net cash provided by/(used in) financing activities | $303,915 | ($277,866) | | **Net Increase/(Decrease) in Cash** | **$348,331** | **($133,632)** | | **Cash, Cash Equivalents, and Restricted Cash - End of period** | **$676,903** | **$198,227** | [Notes to the Unaudited Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20the%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) These notes detail the company's accounting policies, the significant impact of the William Lyon Homes acquisition, debt structure, segment reporting, and subsequent debt refinancing events - The company operates as a residential homebuilder and developer of lifestyle communities across 11 states, serving various consumer groups under the Taylor Morrison, Darling Homes, and William Lyon Signature brands[26](index=26&type=chunk) - On February 6, 2020, the company completed the acquisition of William Lyon Homes (WLH), a major homebuilder in the Western U.S[27](index=27&type=chunk) - The COVID-19 outbreak was declared a global pandemic on March 11, 2020, impacting business operations, though all operations are currently functioning subject to restrictions[28](index=28&type=chunk) - Subsequent to the quarter end, on July 22, 2020, the company issued **$500.0 million** in new Senior Notes and used the proceeds to redeem parts of its 2023 and 2025 notes[29](index=29&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=41&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial condition and results of operations, emphasizing the impacts of the COVID-19 pandemic and the William Lyon Homes acquisition, which significantly increased community count and sales but also led to substantial transaction expenses and purchase accounting adjustments - The acquisition of William Lyon Homes on February 6, 2020, and the COVID-19 pandemic are the primary factors affecting the comparability of results[166](index=166&type=chunk) - Despite an initial slowdown in March, the company saw a recovery in net sales orders in May and June, with June being the best sales month in company history[167](index=167&type=chunk) - The company incurred **$105.1 million** in transaction expenses for the first six months of 2020 related to the William Lyon Homes acquisition, and an unfavorable purchase accounting adjustment of **$60.5 million** to Cost of home closings[172](index=172&type=chunk) - The company had over **$900 million** in available liquidity as of June 30, 2020, through cash on hand and its revolving credit facility[169](index=169&type=chunk) [Results of Operations](index=46&type=section&id=Results%20of%20Operations) The company's Q2 and H1 2020 operational results were heavily influenced by the William Lyon Homes acquisition, leading to increased sales orders and home closings but a decline in home closings gross margin due to purchase accounting adjustments and higher cancellation rates Q2 2020 Operational Highlights vs. Q2 2019 | Metric | Q2 2020 | Q2 2019 | Change | | :--- | :--- | :--- | :--- | | Average Active Selling Communities | 411 | 357 | +15.1% | | Net Sales Orders | 3,453 | 2,810 | +22.9% | | Home Closings | 3,212 | 2,594 | +23.8% | | Home Closings Gross Margin % | 15.4% | 18.0% | -260 bps | | Adjusted Home Closings Gross Margin % | 17.6% | 18.0% | -40 bps | - The increase in the total company cancellation rate to **18.6%** in Q2 2020 from **12.0%** in Q2 2019 is attributed to the impact of COVID-19 and decreased consumer confidence[207](index=207&type=chunk) - Sales order backlog increased **34.7%** in units and **31.5%** in value at June 30, 2020, compared to the prior year, primarily due to the WLH acquisition which contributed approximately **1,400** backlog units[210](index=210&type=chunk) [Non-GAAP Measures](index=46&type=section&id=Non-GAAP%20Measures) The company provides non-GAAP measures, including adjusted net income of **$103.8 million** and an adjusted home closings gross margin of **17.6%** for Q2 2020, to offer a clearer view of performance excluding acquisition-related impacts Q2 2020 Non-GAAP Reconciliation Highlights (in thousands) | Metric | Q2 2020 | Q2 2019 | | :--- | :--- | :--- | | Net Income Available to TMHC (GAAP) | $65,674 | $81,851 | | William Lyon Homes purchase accounting adjustments | $32,138 | $— | | Transaction expenses | $18,712 | $1,750 | | **Adjusted Net Income** | **$103,815** | **$84,787** | Adjusted Home Closings Gross Margin (Q2 2020) | Metric | Amount (in thousands) | % of Revenue | | :--- | :--- | :--- | | Home Closings Gross Margin (GAAP) | $226,770 | 15.4% | | WLH purchase accounting adjustments | $32,138 | 2.2% | | **Adjusted Home Closings Gross Margin** | **$258,908** | **17.6%** | - The net homebuilding debt to capitalization ratio was **46.0%** as of June 30, 2020[198](index=198&type=chunk) [Liquidity and Capital Resources](index=62&type=section&id=Liquidity%20and%20Capital%20Resources) The company ended Q2 2020 with total liquidity of **$910.8 million**, including **$674.7 million** in cash, and subsequently issued **$500 million** in new Senior Notes to redeem higher-cost debt Total Liquidity (in thousands) | Component | June 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | Cash, excluding restricted cash | $674,685 | $326,437 | | Revolving credit facility availability | $236,096 | $522,281 | | **Total liquidity** | **$910,781** | **$848,718** | - As a precautionary measure during the COVID-19 pandemic, the company borrowed **$485.0 million** on its Revolving Credit Facility in Q1 2020[240](index=240&type=chunk) - In July 2020, the company issued **$500.0 million** of 5.125% Senior Notes due 2030 and used proceeds plus cash on hand to redeem portions of its 6.00% 2023 Notes and 5.875% 2025 Notes[241](index=241&type=chunk)[244](index=244&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=68&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to interest rate risk, with approximately **83%** of its debt being fixed-rate, and a hypothetical **1%** increase in rates would raise annual interest expense by approximately **$6.3 million** on variable-rate debt - As of June 30, 2020, approximately **83%** of the company's debt was fixed-rate and **17%** was variable-rate[260](index=260&type=chunk) - A **1%** increase in interest rates would increase annual interest incurred by approximately **$6.3 million**, based on the variable-rate debt outstanding at June 30, 2020[263](index=263&type=chunk) [Item 4. Controls and Procedures](index=69&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded the company's disclosure controls and procedures were effective as of June 30, 2020, excluding the newly acquired William Lyon Homes, which is currently undergoing integration - The company's disclosure controls and procedures were deemed effective as of June 30, 2020[265](index=265&type=chunk) - Management excluded the internal control over financial reporting for the newly acquired William Lyon Homes from its assessment, as permitted, and is in the process of integrating its internal controls[265](index=265&type=chunk)[267](index=267&type=chunk) [PART II. OTHER INFORMATION](index=70&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=70&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal proceedings in the normal course of business, with legal accruals totaling **$25.9 million** as of June 30, 2020, which management does not expect to materially impact financial position - The company is involved in various legal proceedings in the normal course of business[268](index=268&type=chunk) - Legal accruals were **$25.9 million** as of June 30, 2020, compared to **$12.7 million** as of December 31, 2019[149](index=149&type=chunk) [Item 1A. Risk Factors](index=70&type=section&id=Item%201A.%20Risk%20Factors) This section updates the company's risk factors, primarily focusing on the significant and uncertain adverse impacts of the COVID-19 pandemic on global economies, consumer confidence, and the housing market - The primary updated risk factor relates to the unknown scale, scope, and duration of the COVID-19 pandemic and its potential material adverse impact on the business[270](index=270&type=chunk) - COVID-19 may heighten existing risks, including decreased consumer confidence, unfavorable economic conditions, higher cancellation rates, and disruptions to the supply chain and financial services[272](index=272&type=chunk)[276](index=276&type=chunk) - Despite market volatility, the company assessed its goodwill for impairment as of June 30, 2020, and concluded there were no indicators of impairment[274](index=274&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=71&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company renewed its stock repurchase program for up to **$100 million** until December 31, 2020, with no shares repurchased in Q2 2020 but **5,436,479** shares repurchased for the six months ended June 30, 2020 - The company renewed its stock repurchase program for up to **$100 million**, effective until December 31, 2020[276](index=276&type=chunk) - No shares were repurchased in the three months ended June 30, 2020[277](index=277&type=chunk) - For the six months ended June 30, 2020, the company repurchased **5,436,479** shares of Common Stock[124](index=124&type=chunk) [Item 3. Defaults Upon Senior Securities](index=72&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported - None[278](index=278&type=chunk) [Item 4. Mine Safety Disclosures](index=72&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) No mine safety disclosures were reported - None[279](index=279&type=chunk) [Item 5. Other Information](index=72&type=section&id=Item%205.%20Other%20Information) No other information was reported - None[280](index=280&type=chunk) [Item 6. Exhibits](index=73&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the quarterly report, including merger agreements and officer certifications - Lists exhibits filed with the Form 10-Q, including merger agreements and officer certifications[282](index=282&type=chunk)