United Homes (UHG)

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United Homes Stock Slips Post Q2 Earnings Despite Higher Margins
ZACKS· 2025-08-12 17:36
Core Viewpoint - United Homes Group, Inc. (UHG) reported a decline in revenues and net income for the second quarter of 2025, while experiencing a significant increase in share price over the past month, indicating mixed performance amidst challenging market conditions. Financial Performance Summary - UHG's revenues for Q2 2025 were $105.5 million, a decrease of 3.6% from $109.4 million in Q2 2024, with home closings down 10.1% to 303 units from 337 units [2] - The average sales price increased by 2.3% to $349,000 from $341,000, partially offsetting the decline in volume [2] - Gross margin improved by 100 basis points year over year to 18.9% from 17.9%, driven by cost efficiencies and higher-margin redesigned floor plans [2] - Adjusted gross margin rose to 21.3% from 20.9% in the same period [2] Net Income and Adjusted EBITDA - UHG incurred a net loss of $6.3 million, or $0.11 per share, compared to a net income of $28.6 million, or $0.50 per share, in the previous year, primarily due to a $6.2 million non-cash fair value adjustment [3] - Adjusted EBITDA was $7.2 million, down 5.5% from $7.7 million year-over-year, with an adjusted EBITDA margin of 6.9% [3] Key Business Metrics - Net new orders fell 5.9% year over year to 304 homes from 323, with most markets declining except for Upstate and Rosewood, which saw increases of 26% and 78%, respectively [4] - Backlog as of June 30, 2025, was 202 homes valued at approximately $74.9 million, down from 248 homes valued at approximately $85.7 million a year earlier [4] Liquidity Position - Available liquidity as of June 30, 2025, totaled $95.2 million, including $36.5 million in cash and $58.7 million in unused credit capacity [5] Management Commentary - CEO Jack Micenko noted the positive impact of the refreshed product initiative on sales and profitability, with gross margins trending about 300 basis points above legacy designs [6] - CFO Keith Feldman highlighted a 270-basis-point sequential improvement in gross margin due to product mix and cost-saving measures [6] Influencing Factors - Revenue decline was attributed to lower unit volumes and high mortgage rates affecting affordability, despite an increase in average sales price and gross margin expansion [7] - Operating expenses remained elevated as a percentage of revenue due to reduced top-line performance, even though they were slightly lower in dollar terms year over year [7] Guidance - Management expressed confidence in further margin gains in 2025 compared to 2024, citing ongoing product enhancements and disciplined land acquisition strategies [8] Strategic Developments - On May 19, 2025, UHG's board initiated a strategic review process to explore options including a potential sale of the company or asset sales to maximize shareholder value, with no definitive outcome or timeline disclosed [10]
United Homes (UHG) - 2025 Q2 - Quarterly Report
2025-08-08 11:04
Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2025 o 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: 001-39936 United Homes Group, Inc. (Exact name of Registrant as specified in its charter) Delaware 85-3460766 (State or ...
United Homes (UHG) - 2025 Q2 - Earnings Call Transcript
2025-08-07 13:30
United Homes Group (UHG) Q2 2025 Earnings Call August 07, 2025 08:30 AM ET Speaker0Ladies and gentlemen, thank you for standing by, and welcome to the United Homes Group Second Quarter twenty twenty five Earnings Call and Webcast. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. As a reminder, today's call is being recorded. I will now hand today's call over to Erin Reeves McGinnis, General Counsel.Please go ahead.S ...
United Homes (UHG) - 2025 Q2 - Quarterly Results
2025-08-07 11:30
Second Quarter 2025 Operating Results For the second quarter 2025, net loss was $6.3 million, or $0.11 per diluted share, which included a loss from the change in fair value of derivative liabilities of $6.2 million, with that change predominantly due to changes in fair value on potential earn-out consideration due to fluctuation in the stock price during the measurement period, representing a non-cash item. The earnout consideration would be paid in common shares upon reaching certain stock price hurdles. ...
United Homes Group: Further Upside Is Warranted
Seeking Alpha· 2025-06-20 18:56
Group 1 - The housing industry is viewed positively due to perpetual undersupply, stability as an asset, and benefits from a growing population [1] - The focus is on identifying companies in the oil and gas sector that are trading at significant discounts to their intrinsic value [1] - The investment approach combines Benjamin Graham's philosophy with a contrarian market perspective [1]
United Homes Stock Declines Post Q1 Earnings Amid Slower Closings
ZACKS· 2025-05-16 18:21
Shares of United Homes Group, Inc. (UHG) have lost 10.8% since the company reported its earnings for the quarter ended March 31, 2025. This contrasts with the S&P 500 Index’s 0.6% gain over the same period. Over the past month, UHG stock has plunged 17.2%, underperforming the S&P 500, which recorded an 11.8% gain.Revenue and Earnings OverviewFor the first quarter of 2025, UHG posted revenues of $87 million, down 13.7% from $100.8 million in the year-ago period. This decline was primarily due to an 18.9% yea ...
United Homes (UHG) - 2025 Q1 - Quarterly Report
2025-05-14 20:32
PART I. FINANCIAL INFORMATION [Condensed Consolidated Financial Statements](index=5&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%3A) Unaudited condensed consolidated financial statements for Q1 2025 reflect decreased revenue and net income, stable total assets, reduced liabilities, and improved operating cash flow compared to Q1 2024 [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20%28unaudited%29) As of March 31, 2025, total assets slightly increased to **$266.2 million**, while total liabilities decreased to **$179.1 million**, boosting stockholders' equity to **$87.1 million** Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$266,227** | **$265,381** | | Cash and cash equivalents | $25,016 | $22,629 | | Inventories | $138,449 | $139,270 | | **Total Liabilities** | **$179,126** | **$198,514** | | Syndicated line of credit | $53,196 | $50,196 | | Derivative liabilities | $17,836 | $39,158 | | Term loan, net | $67,230 | $67,150 | | **Total Stockholders' Equity** | **$87,101** | **$66,867** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20%28unaudited%29) Q1 2025 net income decreased to **$18.2 million** on **$87.0 million** revenue, influenced by a non-cash gain from derivative liabilities, resulting in diluted EPS of **$0.31** Q1 2025 vs Q1 2024 Statement of Operations (in thousands, except per share data) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue, net | $87,001 | $100,838 | | Gross Profit | $14,128 | $16,094 | | Net loss from operations | $(2,032) | $(960) | | Change in fair value of derivative liabilities | $21,209 | $26,380 | | **Net Income** | **$18,180** | **$24,938** | | Diluted EPS | $0.31 | $0.44 | [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders%27%20Equity%20%28unaudited%29) Total stockholders' equity increased by **$20.2 million** to **$87.1 million** in Q1 2025, primarily driven by net income and stock-based compensation expense - Stockholders' equity grew from **$66.9 million** at the end of 2024 to **$87.1 million** at the end of Q1 2025, mainly due to net income of **$18.2 million**[19](index=19&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20%28unaudited%29) Q1 2025 saw net cash provided by operating activities of **$1.2 million**, a significant improvement from Q1 2024, with total cash ending at **$27.9 million** Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash from operating activities | $1,221 | $(17,898) | | Net cash from investing activities | $63 | $(12,752) | | Net cash from financing activities | $1,103 | $2,629 | | **Net change in cash** | **$2,387** | **$(28,021)** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20%28unaudited%29) Notes detail accounting policies, business nature, and key disclosures including land-light strategy, VIEs, segment performance, fair value measurements, debt, and stock-based compensation - The company operates a land-light strategy, primarily constructing single-family homes in South Carolina, North Carolina, and Georgia[25](index=25&type=chunk) - The company has determined that its counterparties to option contracts are Variable Interest Entities (VIEs), but it is not the primary beneficiary and therefore does not consolidate them, with maximum exposure to loss limited to non-refundable lot deposits[35](index=35&type=chunk) - In December 2024, the company redeemed its outstanding Convertible Notes, financing the transaction in part by entering into a new **$70.0 million** term loan[87](index=87&type=chunk) [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 challenging Q1 2025 market conditions, leading to decreased revenue and orders, and outlines responses including sales incentives and operational improvements, while confirming sufficient liquidity Key Operating Metrics Q1 2025 vs Q1 2024 | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | Revenue, net | $87,001K | $100,838K | (13.7)% | | Home closings | 252 | 311 | (19.0)% | | Net new orders | 296 | 384 | (22.9)% | | Backlog (units) | 201 | 262 | (23.3)% | | Cancellation rate | 12.7% | 9.6% | 32.3% | - Market conditions in Q1 2025 were challenging due to elevated mortgage rates, economic uncertainty, and housing affordability concerns, leading to softer demand[111](index=111&type=chunk) - The company is responding to market conditions with sales incentives (e.g., mortgage rate buy-downs) and operational improvements like revising house plans and rebidding supplier contracts to reduce costs[112](index=112&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=33&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk stems from interest rate fluctuations impacting housing demand and variable-rate debt, with a 100 basis point increase potentially reducing annual net income by **$1.2 million** - The company is exposed to market risk from interest rate fluctuations on its variable-rate debt, which includes a **$53.2 million** syndicated line of credit and a **$67.2 million** term loan as of March 31, 2025[167](index=167&type=chunk) - A **100 basis point** increase in overall interest rates would negatively impact the company's net income by approximately **$1.2 million** annually[167](index=167&type=chunk) [Controls and Procedures](index=33&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 during Q1 2025 - Management concluded that disclosure controls and procedures were effective as of the end of the quarter[168](index=168&type=chunk) - No changes occurred during Q1 2025 that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[169](index=169&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=34&type=section&id=Item%201.%20Legal%20Proceedings) The company faces ordinary course legal claims, including a specific lawsuit against its subsidiary Rosewood for pre-acquisition construction defects, with potential losses currently unestimable - The company's subsidiary, Rosewood, is a co-defendant in a lawsuit alleging negligence and breach of implied warranties related to construction prior to its acquisition[85](index=85&type=chunk) - Management believes a loss is reasonably possible but cannot estimate the amount or range of loss at this time[86](index=86&type=chunk) [Risk Factors](index=34&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors from the latest 10-K, but key risks include cyclical homebuilding industry sensitivity to economic conditions, trade policies, and adverse weather events - The residential homebuilding industry is highly cyclical and significantly affected by changes in economic conditions, including interest rates, employment levels, and consumer confidence[173](index=173&type=chunk) - Changes in U.S. trade policies and tariffs on imported materials like steel, aluminum, and lumber could significantly increase construction costs and negatively impact margins[178](index=178&type=chunk) - Adverse weather, such as the abnormal snow events in South Carolina in early 2025, can harm business by decreasing buyer traffic and delaying construction[176](index=176&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=35&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered sales of equity securities were reported for the quarter ended March 31, 2025, not previously disclosed in a Form 8-K - No unregistered sales of the Company's securities were reported for the quarter ended March 31, 2025[183](index=183&type=chunk) [Defaults Upon Senior Securities](index=35&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported during the quarter - No defaults upon senior securities were reported[183](index=183&type=chunk) [Mine Safety Disclosures](index=35&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - Not applicable[181](index=181&type=chunk) [Other Information](index=35&type=section&id=Item%205.%20Other%20Information) No other material events or information were reported for the quarter ended March 31, 2025, not covered elsewhere in the report - No other information was reported for the quarter[182](index=182&type=chunk) [Exhibits](index=37&type=section&id=Item%206.%20Exhibits) This section indexes all exhibits filed with the Form 10-Q, including CEO/CFO certifications and Inline XBRL files for financial data - The report includes certifications from the CEO and CFO pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act[188](index=188&type=chunk)
United Homes (UHG) - 2025 Q1 - Earnings Call Transcript
2025-05-14 13:32
Financial Data and Key Metrics Changes - For Q1 2025, the company reported net income of $18.2 million, which includes a fair value adjustment of $21.2 million related to contingent earn-out liability [19] - Revenue for Q1 2025 was $87 million, a decrease of $13.8 million or 13.7% from $100.8 million in Q1 2024, primarily due to lower home closings [19][20] - Gross profit for Q1 2025 was $14.1 million, down $2 million or 12.4% from $16.1 million in the prior year [21] - Adjusted gross margin was 18.8%, down from 20.4%, reflecting elevated incentive costs and price reductions [21] Business Line Data and Key Metrics Changes - The company delivered 252 homes in Q1 2025, with an average sales price of $345,000, generating home sales revenue of $87 million [5][19] - Home closings decreased from 311 homes in Q1 2024 to 252 homes in Q1 2025 [20] - Net new orders for Q1 2025 were 296 homes, down from 384 homes in the prior year [20] Market Data and Key Metrics Changes - The company noted that affordability continues to be an issue for buyers, necessitating financing incentives [14] - April orders were up 6% year over year, indicating a positive trend in demand [11][14] Company Strategy and Development Direction - The company is focusing on a product refresh and direct cost reduction initiatives to improve competitive positioning and profitability [6][8] - A strategic shift towards presold homes is being implemented, moving away from a high spec home strategy to balance offerings [9][10] - The company plans to open 10 new communities in Q2 and 18 in Q3, featuring newly refreshed products that have been well received [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term prospects in markets like the Carolinas and Georgia, citing favorable housing fundamentals [10][11] - The company is adapting to shifting market dynamics and remains focused on execution and capital allocation [23] Other Important Information - The company controlled approximately 7,500 lots as of Q1 2025, positioning it for future growth [23] - Cash and liquidity stood at approximately $86.9 million as of Q1 2025 [23] Summary of Q&A Session - There were no questions during the Q&A session, and the call concluded with management expressing gratitude to participants and optimism for the future [25][28]
United Homes (UHG) - 2025 Q1 - Earnings Call Transcript
2025-05-14 13:30
Financial Data and Key Metrics Changes - For Q1 2025, the company reported net income of $18.2 million, which includes a fair value adjustment of $21.2 million related to contingent earn-out liability [18] - Revenue for Q1 2025 was $87 million, a decrease of $13.8 million or 13.7% from $100.8 million in Q1 2024, primarily due to lower home closings [18][19] - Home closings totaled 252 homes, down from 311 homes in the prior year period [19] - The average sales price for production built homes was approximately $345,000, a 2.9% increase compared to $335,000 in Q1 2024 [19] - Gross profit for Q1 2025 was $14.1 million, down $2 million or 12.4% from $16.1 million in the prior year [20] - Gross margin improved slightly to 16.2% from 16% [20] Business Line Data and Key Metrics Changes - The company delivered 252 homes in Q1 2025, with an average sales price of $345,000, generating home sales revenue of $87 million [4] - Net new orders for Q1 2025 were 296 homes, down from 384 homes in the prior year period [19] - The backlog as of March 31, 2025, stood at 201 homes, representing approximately $75.3 million in value [20] Market Data and Key Metrics Changes - The company noted that affordability continues to be an issue for buyers, necessitating the use of financing incentives [13] - April orders were up 6% year over year, indicating a positive trend in demand [10][13] Company Strategy and Development Direction - The company has undertaken a product refresh and direct cost reduction initiative to improve competitive positioning and profitability [5][6] - A strategic shift towards presold homes is being emphasized, moving away from a high spec home strategy [8][9] - The company plans to open 10 new communities in Q2 and 18 communities in Q3, which are expected to boost sales efforts [15][22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term prospects for markets in the Carolinas and Georgia due to favorable housing fundamentals [10] - The company is adapting to shifting market dynamics and remains focused on execution and capital allocation [22] - Management noted that the spring selling season started slowly but showed momentum exiting the quarter into April [22] Other Important Information - The company controlled approximately 7,500 lots as of March 31, 2025, positioning it for future growth [22] - Selling, general and administrative expenses for Q1 were $16.2 million, with adjusted SG&A totaling $14.2 million or 16.3% of revenue [21] Summary of Q&A Session - There were no questions during the Q&A session, and the call concluded with management expressing optimism about the future of the company [24][25]
United Homes (UHG) - 2025 Q1 - Quarterly Results
2025-05-14 10:59
[United Homes Group, Inc. Reports 2025 First Quarter Results](index=1&type=section&id=United%20Homes%20Group%2C%20Inc.%20Reports%202025%20First%20Quarter%20Results) [First Quarter 2025 Operating Results and Highlights](index=1&type=section&id=First%20Quarter%202025%20Operating%20Results) Q1 2025 saw United Homes Group's revenue at $87.0 million and net income at $18.2 million, boosted by a $21.2 million non-cash gain Q1 2025 vs. Q1 2024 Key Performance Indicators | Metric | Q1 2025 | Q1 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Revenue, net | $87.0 million | $100.8 million | -14% | | Net Income | $18.2 million | $24.9 million | -26.9% | | Diluted EPS | $0.31 | $0.44 | -29.5% | | Home Closings | 252 | 311 | -19% | | Net New Home Orders | 296 | 384 | -23% | | ASP (Production-built) | ~$345,000 | ~$335,000 | +2.9% | | Gross Profit % | 16.2% | 16.0% | +0.2 p.p. | | Adjusted Gross Profit % | 18.8% | 20.4% | -1.6 p.p. | | Adjusted EBITDA | $2.9 million | $7.3 million | -60.5% | - Net income for Q1 2025 included a significant non-cash income of **$21.2 million** from the change in fair value of derivative liabilities, related to potential earn-out consideration tied to stock price hurdles[3](index=3&type=chunk) - The company is strategically shifting from building all-spec inventory to offering pre-sales, which are achieving higher gross margins[4](index=4&type=chunk) - Gross margins improved sequentially by **400 basis points** between January and March, largely due to closings of newly redesigned home plans which average gross margins of approximately **24%**[7](index=7&type=chunk) - A direct cost reduction initiative has identified over **$3.5 million** in savings for the year, with the financial impact expected to be more meaningful in the second half of 2025[7](index=7&type=chunk) - As of March 31, 2025, the company had available liquidity of **$86.9 million**, consisting of **$25.0 million** in cash and **$61.9 million** in unused credit facility capacity[6](index=6&type=chunk) [Company Overview and Strategy](index=2&type=section&id=About%20United%20Homes%20Group%2C%20Inc.) United Homes Group is a South Carolina-based residential builder in high-growth southeastern markets, employing a 'land-light' strategy - The company is a residential builder focused on high-growth southeastern markets: South Carolina, North Carolina, and Georgia[9](index=9&type=chunk) - UHG primarily builds detached and attached single-family houses for the entry-level, first, second, and third move-up segments[10](index=10&type=chunk) - The company employs a 'land-light' operating strategy, using lot option contracts to control its supply of finished lots, reducing financial risks associated with acquiring and developing raw land[11](index=11&type=chunk) - Future expansion will target markets with positive population and employment growth, housing affordability, low taxes, and desirable lifestyle characteristics[12](index=12&type=chunk) [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) Forward-looking statements are subject to risks like market disruptions, industry slowdowns, supply chain issues, and interest rate increases - The report contains forward-looking statements that are not guarantees of future performance and are subject to risks and uncertainties[14](index=14&type=chunk)[15](index=15&type=chunk) - Key risk factors include: - Disruption in mortgage financing availability - A slowdown in the homebuilding industry - Shortages or price increases for labor, land, or raw materials - Increases in interest rates or inflationary pressures - Ability to execute business model and integrate acquisitions[18](index=18&type=chunk) [Financial Statements](index=4&type=section&id=Financial%20Statements) [Condensed Consolidated Balance Sheets](index=4&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) As of March 31, 2025, total assets were $266.2 million, liabilities $179.1 million, and equity $87.1 million Balance Sheet Summary (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$266,227** | **$265,381** | | Cash and cash equivalents | $25,016 | $22,629 | | Inventories | $138,449 | $139,270 | | **Total Liabilities** | **$179,126** | **$198,514** | | Derivative liabilities | $17,836 | $39,158 | | Syndicated line of credit | $53,196 | $50,196 | | **Total Stockholders' equity** | **$87,101** | **$66,867** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Q1 2025 revenue was $87.0 million, gross profit $14.1 million, and net income $18.2 million, boosted by a $21.2 million non-cash gain Statement of Operations Summary (in thousands, except per share data) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue, net of sales discounts | $87,001 | $100,838 | | Gross profit | $14,128 | $16,094 | | Net loss from operations | $(2,032) | $(960) | | Change in fair value of derivative liabilities | $21,209 | $26,380 | | **Net income** | **$18,180** | **$24,938** | | **Diluted EPS** | **$0.31** | **$0.44** | [GAAP to Non-GAAP Reconciliations](index=6&type=section&id=GAAP%20TO%20NON-GAAP%20RECONCILIATIONS) [Adjusted Gross Profit](index=6&type=section&id=Adjusted%20Gross%20Profit) Q1 2025 Adjusted Gross Profit was $16.4 million (18.8% margin), adjusted from GAAP by adding back interest and amortization Adjusted Gross Profit Reconciliation (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Gross profit (GAAP) | $14,128 | $16,094 | | Interest expense in cost of sales | 1,501 | 3,513 | | Amortization in homebuilding cost of sales | 681 | 948 | | **Adjusted gross profit (Non-GAAP)** | **$16,365** | **$20,614** | | Gross profit % (GAAP) | 16.2% | 16.0% | | **Adjusted gross profit % (Non-GAAP)** | **18.8%** | **20.4%** | [EBITDA and Adjusted EBITDA](index=7&type=section&id=EBITDA%20and%20Adjusted%20EBITDA) Q1 2025 Adjusted EBITDA was $2.9 million (3.3% margin), a decline from Q1 2024, after subtracting a $21.2 million non-cash gain Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net income (GAAP) | $18,180 | $24,938 | | EBITDA (Non-GAAP) | $21,389 | $29,921 | | Change in fair value of derivative liabilities | (21,209) | (26,380) | | Stock-based compensation expense | 1,957 | 1,510 | | **Adjusted EBITDA (Non-GAAP)** | **$2,873** | **$7,283** | | Adjusted EBITDA margin % | 3.3% | 7.2% | [Adjusted SG&A](index=8&type=section&id=Adjusted%20SG%26A) Q1 2025 Adjusted SG&A was $14.2 million (16.3% of revenue), excluding stock-based compensation from GAAP SG&A Adjusted SG&A Reconciliation - Q1 2025 (in thousands) | Line Item | Amount | | :--- | :--- | | Selling, general and administrative expense (GAAP) | $16,160 | | Stock-based compensation expense | 1,957 | | **Adjusted SG&A (Non-GAAP)** | **$14,203** | | SG&A % (GAAP) | 18.6% | | **Adjusted SG&A % (Non-GAAP)** | **16.3%** | [Adjusted Book Value](index=9&type=section&id=Adjusted%20Book%20Value) As of March 31, 2025, Adjusted Book Value was $95.7 million, adjusting equity for derivative liabilities and goodwill Adjusted Book Value Reconciliation - March 31, 2025 (in thousands) | Line Item | Amount | | :--- | :--- | | Total Stockholders' equity (GAAP) | $87,101 | | Add: Derivative liabilities | 17,836 | | Less: Goodwill | (9,280) | | **Adjusted book value (Non-GAAP)** | **$95,657** | [Operational Metrics](index=10&type=section&id=OPERATIONAL%20METRICS%20BY%20MARKET) [Operational Metrics by Market](index=10&type=section&id=Operational%20Metrics%20by%20Market) Q1 2025 saw total net new orders and closings decrease year-over-year, with Raleigh showing significant growth despite declines elsewhere Q1 2025 Net New Orders & Closings by Market (vs. Q1 2024) | Market | Net New Orders (YoY %) | Closings (YoY %) | | :--- | :--- | :--- | | Coastal | -43% | 0% | | Midlands | -28% | -17% | | Upstate | -24% | -44% | | Rosewood | +113% | -7% | | Raleigh | +325% | +275% | | **Total** | **-23%** | **-19%** | Backlog as of March 31, 2025 (vs. March 31, 2024) | Market | Backlog Inventory (YoY %) | Backlog Value (YoY %) | | :--- | :--- | :--- | | Coastal | +14% | +31% | | Midlands | -29% | -25% | | Upstate | -44% | -29% | | Rosewood | +40% | +67% | | Raleigh | +100% | +32% |