Core Insights - Bragar Eagel & Squire, P.C. is investigating potential claims against Trex Company, Inc., United Homes Group, Inc., and Nidec Corporation for possible violations of federal securities laws and unlawful business practices [1] Trex Company, Inc. (NYSE:TREX) - Trex reported disappointing Q3 2025 financial results with net sales of $285 million, which was 5% below the mid-point of its guidance and a sequential decline of about 26% [5] - The company experienced a 12% decline in net income per share for the nine months ended September 30, 2025, compared to the prior year [5] - Trex revised its FY 2025 sales growth guidance down to roughly 0% compared to 2024, expecting a "muted" fourth quarter [5] - Following the announcement, Trex's share price fell by $14.61, or approximately 31.07%, closing at $32.43 on November 5, 2025 [5] United Homes Group, Inc. (NASDAQ:UHG) - On October 20, 2025, six board members of UHG resigned after Executive Chairman Michael Nieri refused to step down or forgo future compensation [5] - The special committee of independent directors concluded that continuing as an independent public company was in the best interests of UHG and its stockholders [5] - UHG's stock price fell by $2.24, or 52.46%, closing at $2.03 per share on October 20, 2025 [5] Nidec Corporation (OTCMKTS:NJDCY) - Nidec established a third-party committee to investigate suspicions of improper accounting, revealing multiple documents suggesting potential improper practices [5] - Following the initial disclosure, Nidec's ADR price fell by $0.81, or 16.5%, closing at $4.11 on September 4, 2025 [5] - On September 26, 2025, Nidec disclosed further findings of inappropriate accounting practices, leading to a decline in ADR price by $0.29, or 6.6%, to $4.09 [5] - Nidec withdrew its year-end forecast and decided not to pay a surplus dividend due to ongoing investigations, resulting in a price drop of $1.17, or 25.4%, to $3.43 on October 23, 2025 [5] - The Tokyo Stock Exchange designated Nidec under a Special Security alert due to identified deficiencies in its internal management systems [5][8]

Core Viewpoint - United Homes Group, Inc. (UHG) reported a significant decline in earnings for the third quarter of 2025, with a net loss widening to $31.3 million, reflecting challenges in home closings and increased non-cash losses from derivative liabilities [2][12] Financial Performance - Revenue for Q3 2025 fell 23.5% year-over-year to $90.8 million from $118.6 million, primarily due to a 28.9% decline in home closings [2][4] - The net loss for the quarter was $31.3 million, or $0.53 per diluted share, compared to a loss of $7.3 million, or $0.15 per diluted share, in Q3 2024 [2] - Gross margin contracted to 17.7% from 18.9%, while adjusted gross margin slipped to 19.6% from 20.6% [3][5] - Adjusted EBITDA for the quarter decreased 57.5% to $3.8 million from $8.9 million, with the adjusted EBITDA margin contracting to 4.2% from 7.6% [6] Operational Metrics - For the first nine months of 2025, revenue declined 13.9% to $283.3 million, and home closings dropped 19.7% to 817 [4] - Net new orders eased 4.9% to 324 from 341 a year earlier, although the average sales price of production-built homes rose about 8.1% to $346,000 [3][5] - The company reported a backlog of 264 homes valued at approximately $94.3 million, indicating a 20% increase in backlog value year-over-year [7] Market Conditions - Closings dropped broadly across key markets, with a 45.6% decline in the Midlands region and a 22.2% decline in the Raleigh region [8][11] - Management attributed the quarter's performance to affordability challenges and a choppy housing market, but noted sequential improvement in September [9][13] Strategic Developments - United Homes concluded a review of strategic alternatives, deciding to continue as an independent public company, which led to several director resignations [14] - The company is focusing on operational efficiencies, cost savings, and maintaining a disciplined approach to pricing and incentives [10][13]

Revenue and Profitability - UHG's revenue for the three months ended September 30, 2025, was approximately $90.8 million, a decrease of 23.5% from $118.6 million in the same period of 2024[118][125]. - For the nine months ended September 30, 2025, UHG generated revenue of approximately $283.3 million, down from $328.9 million in the same period of 2024, reflecting a decrease of 13.9%[119][120]. - Revenue for the nine months ended September 30, 2025 was $283.3 million, a decrease of $45.6 million, or 13.9%, from $328.9 million for the same period in 2024[145]. - Gross profit for the three months ended September 30, 2025 was $16.0 million, a decrease of $6.4 million, or 28.6%, from $22.4 million for the same period in 2024[128]. - Gross profit for the nine months ended September 30, 2025, was $50.1 million, down 13.8% from $58.1 million in 2024, with a gross margin of 17.7%[150]. - Adjusted gross profit for the three months ended September 30, 2025 was $17.8 million, a decrease of $6.7 million, or 27.4%, compared to $24.5 million for the same period in 2024[129]. - Adjusted gross profit decreased to $56.6 million for the nine months ended September 30, 2025, down 16.6% from $67.9 million in 2024, with an adjusted gross margin of 20.0%[151]. - The company reported a net loss of approximately $31.3 million for the three months ended September 30, 2025, compared to a net loss of $7.3 million in the prior year, representing an increase in net loss of 326.4%[118][124]. - Net (loss) income for the nine months ended September 30, 2025 was $(19.5) million, compared to $46.2 million for the same period in 2024, representing a decrease of $65.7 million, or 142.1%[145]. Orders and Closings - The company had 324 net new orders for the three months ended September 30, 2025, a decrease of 5.0% compared to 341 net new orders in the same period of 2024[113][115]. - Net new orders for the three months ended September 30, 2025 were 324 units, a decrease of 17 units, or 5.0%, from 341 units for the same period in 2024[140]. - Net new orders for the nine months ended September 30, 2025, were 924 units, a decrease of 124 units from 1,048 units in the same period of 2024[161]. - The cancellation rate for the three months ended September 30, 2025 was 14.3%, an increase of 1.5%, from 12.8% for the same period in 2024[141]. - The cancellation rate increased to 12.8% for the nine months ended September 30, 2025, up from 11.6% in the prior year[162]. - The company experienced a 29.0% decrease in home closings, with 262 closings in the three months ended September 30, 2025, down from 369 closings in the prior year[118][125]. - Home closings decreased by 19.7% to 817 units in the nine months ended September 30, 2025, compared to 1,017 units in the prior year[148]. Backlog and Sales Price - UHG's backlog increased by 20.0% to 264 homes as of September 30, 2025, compared to 220 homes in the prior year[124]. - Backlog as of September 30, 2025 was 264 units, an increase of 44 units, or 20.0%, from 220 units as of September 30, 2024[143]. - The average sales price of homes closed increased by 8.0% to $345,920 for the three months ended September 30, 2025, compared to $320,199 in the same period of 2024[124][126]. Operational Improvements and Strategy - UHG's operational improvements include refreshing the portfolio of house plans and expanding customization options for buyers to enhance sales and gross margins[117]. - The company plans to grow organically and through the expansion of its mortgage joint venture, Homeowners Mortgage, LLC, to improve revenue and EBITDA growth[114]. Expenses and Cash Flow - Selling, general and administrative expense for the three months ended September 30, 2025 was $17.6 million, a decrease of $1.1 million, or 5.9%, from $18.7 million for the same period in 2024[129]. - Selling, general and administrative expenses decreased to $51.7 million for the nine months ended September 30, 2025, down from $55.4 million in 2024[151]. - Net cash flows used in operating activities for the nine months ended September 30, 2025, were $21.0 million, an increase of $9.0 million compared to $12.0 million for the same period in 2024[181]. Financial Position and Liquidity - As of September 30, 2025, UHG had approximately $25.6 million in cash and cash equivalents, an increase of $3.0 million from $22.6 million as of December 31, 2024[170]. - The Syndicated Line of credit had outstanding borrowings of $79.7 million as of September 30, 2025, with $57.5 million available under the facility[174]. - The term loan had an outstanding balance of $67.4 million as of September 30, 2025, with a weighted average interest rate of 11.59%[177]. - UHG's liquidity and profitability could be adversely impacted by continued operational headwinds[171]. Tax and Derivative Liabilities - The effective tax rate for the full fiscal year as of September 30, 2025 is estimated at 11.7%, compared to 17.0% as of September 30, 2024[139]. - The estimated annual effective tax rate for the Company as of September 30, 2025, is 11.7%, compared to 17.0% as of September 30, 2024[155]. - Change in fair value of derivative liabilities for the three months ended September 30, 2025 was a loss of $27.2 million, compared to a loss of $7.8 million for the same period in 2024, representing an increase in loss of $19.4 million, or 249.5%[132]. - The change in fair value of derivative liabilities resulted in a loss of $12.2 million for the nine months ended September 30, 2025, compared to a gain of $50.7 million in the prior year[154]. Interest Rate Impact - A 100 basis point increase in overall interest rates would negatively affect the Company's net income by approximately $1.5 million[191].

PresentationLadies and gentlemen, thank you for standing by. My name is [ Desiree ], and I will be your conference operator today. At this time, I would like to welcome everyone to the United Homes Group Third Quarter 2025 Earnings Call and Webcast. [Operator Instructions] Please be advised that this call is being recorded. Thank you. I would now like to turn the conference over to Erin Reeves McGinnis with United Homes Group. You may begin.Erin McGinnisGeneral Counsel & Corporate Secretary Good morning, an ...

Financial Data and Key Metrics Changes - For Q3 2025, the company reported a net loss of $31.3 million, which includes a loss from the change in fair value of derivative liabilities of $27.2 million [8] - Revenue for Q3 2025 was $90.8 million, a decrease of $27.8 million from $118.6 million in Q3 2024 [8] - For the nine months ending September 30, 2025, revenue was $283.3 million, compared to $328.9 million for the same period in 2024 [9] - Gross profit for Q3 2025 was $16 million, down from $22.4 million in the prior year period [10] - Selling, general, and administrative expenses for Q3 were $17.6 million, with adjusted SG&A totaling $15 million, or 16.5% of revenue [11] Business Line Data and Key Metrics Changes - Home closings for Q3 2025 totaled 262 homes, down from 369 homes in the prior year [9] - The average sales price for production-built homes during the quarter was approximately $346,000, an 8.1% increase compared to $320,000 in Q3 2024 [9] - Net new orders for Q3 were 324 homes, down from 341 homes in the prior year period [10] Market Data and Key Metrics Changes - The company experienced uneven demand in Q3 due to elevated inventory levels and affordability pressures [5] - Traffic improved significantly, averaging between 350-400 weekly visits during Q3, compared to around 200 per week in the first half of the year [5] Company Strategy and Development Direction - The board formed a special committee to review strategic alternatives, concluding that remaining an independent public company is the best path forward [4] - The company is focused on improving operations and profitability through key initiatives and cost savings [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged near-term market challenges but expressed confidence in housing demand fundamentals, including the need for new construction and favorable demographics [7] - The company noted that September was the best order month year-to-date, indicating a potential rebound [6] Other Important Information - As of September 30, 2025, the company controlled approximately 7,700 lots, positioning it for future growth [12] - The company had approximately $83.1 million of liquidity in cash and credit facility availability as of Q3 [12] Q&A Session Summary - No specific questions or answers were provided in the content regarding the Q&A session

Financial Performance - For Q3 2025, the net loss was $31.3 million, or $0.53 per diluted share, compared to a net loss of $7.3 million, or $0.15 per diluted share in Q3 2024[2] - Revenue for Q3 2025 was $90.8 million, a decrease of 23% from $118.6 million in Q3 2024[4] - Adjusted EBITDA for Q3 2025 was $3.8 million, compared to $9.0 million in Q3 2024[5] - For the nine months ended September 30, 2025, net loss was $19.5 million, or $0.33 per diluted share, compared to net income of $46.2 million, or $0.86 per diluted share in the same period of 2024[6] - Revenue for the nine months ended September 30, 2025 was $283.3 million, down from $328.9 million in the same period of 2024[7] - Gross profit for the three months ended September 30, 2025, was $16,048,000, down 28.4% from $22,383,000 in the prior year[26] - Adjusted EBITDA for the three months ended September 30, 2025, was $3,815,000, compared to $8,978,000 in the same period of 2024, a decline of 57.5%[34] Sales and Orders - Home closings in Q3 2025 were 262, down 29% from 369 in Q3 2024, while net new orders decreased by 5% to 324 from 341[4] - Total net new orders for the three months ended September 30, 2025, decreased by 5.0% year-over-year to 324, while total closings decreased by 29.0% to 262[43] - For the nine months ended September 30, 2025, total net new orders decreased by 11.8% to 924, and total closings decreased by 19.7% to 817[43] Margins and Expenses - Gross margin for Q3 2025 was 17.7%, a decrease of 120 basis points from 18.9% in Q3 2024, while adjusted gross margin was 19.6%, down from 20.6%[3] - Adjusted gross profit for the three months ended September 30, 2025, was $17,814,000, down from $24,481,000 in 2024, reflecting a decrease of 27.2%[29] - Selling, general and administrative expenses for the three months ended September 30, 2025, were $17,573,000, slightly down from $18,690,000 in 2024[26] Assets and Liabilities - Total assets increased to $293,114,000 as of September 30, 2025, up from $265,381,000 on December 31, 2024, representing an increase of 10.5%[23] - Total liabilities increased to $240,205,000 as of September 30, 2025, from $198,514,000 on December 31, 2024, marking a rise of 20.9%[24] - Cash and cash equivalents rose to $25,649,000 as of September 30, 2025, compared to $22,629,000 at the end of 2024, an increase of 13.4%[23] - Available liquidity as of September 30, 2025 was $83.1 million, including $25.6 million in cash and $57.5 million in unused committed capacity under the credit facility[4] Market Performance - The backlog inventory as of September 30, 2025, increased by 20.0% to 264 homes, with a backlog value of $94.3 million, up 18.0% from the previous year[43] - In the Coastal market, net new orders decreased by 16.8% to 153, while closings decreased by 3.9% to 146 for the nine months ended September 30, 2025[43] - The Midlands market experienced a 21.9% decrease in net new orders to 442 and a 27.8% decrease in closings to 374 for the same period[43] - The Upstate market showed a slight decrease of 0.4% in net new orders to 252, with closings down 24.7% to 223[43] - Rosewood market saw a significant increase in net new orders by 92.0% to 48, and closings increased by 43.3% to 43[43] - Raleigh market reported a 45.0% increase in net new orders to 29, while closings increased by 47.6% to 31[43] - The backlog value in the Coastal market increased by 15.2% to $19.7 million, while the Midlands market's backlog value increased by 17.8% to $47.1 million[43] Stockholders' Equity - Total stockholders' equity as of September 30, 2025, is $52,909 million, with an adjusted book value of $94,846 million[42]

Core Points - United Homes Group, Inc. (UHG) is under investigation for potential violations of federal securities laws following the resignation of six board members after the Executive Chairman refused to step down [1][2] - UHG's stock price experienced a significant decline of $2.23, or 52.5%, closing at $2.03 per share on October 20, 2025, impacting investors adversely [3] Company Developments - On October 20, 2025, UHG disclosed the resignation of six board members, which was prompted by the Executive Chairman's refusal to resign and forgo compensation after a strategic review [2] - The investigation by Glancy Prongay & Murray LLP is aimed at protecting the rights of UHG investors who may have suffered financial losses due to these developments [1][4] Legal Context - Glancy Prongay & Murray LLP is a prominent law firm specializing in securities litigation and has a history of successful recoveries for investors [7][8] - The firm encourages individuals with non-public information regarding UHG to consider participating in the SEC Whistleblower Program, which offers rewards for original information leading to successful recoveries [6]

Core Insights - Holzer & Holzer, LLC is investigating United Homes Group, Inc. for potential compliance issues with federal securities laws following the resignation of several board members after the Executive Chairman refused to step down, which led to a decline in the company's stock price [1] Company Summary - United Homes Group, Inc. (NASDAQ: UHG) experienced a significant event with multiple board member resignations, raising concerns about governance and compliance with federal regulations [1] - The stock price of United Homes Group dropped in response to the news of the board resignations [1] Legal Context - Holzer & Holzer, LLC is a law firm specializing in securities litigation, representing shareholders and investors in cases of corporate misconduct [3] - The firm has a history of recovering substantial amounts for shareholders affected by fraud, indicating a proactive approach to protecting investor rights [3]

Core Viewpoint - Pomerantz LLP is investigating potential securities fraud and unlawful business practices involving United Homes Group, Inc. (UHG) and its officers or directors [1]. Group 1: Company Developments - On October 20, 2025, six board members of UHG resigned after Executive Chairman Michael Nieri refused to step down or forgo future compensation, despite a special committee's recommendation for strategic changes [2]. - Following the board resignations, UHG's stock price dropped by $2.24 per share, a decline of 52.46%, closing at $2.03 per share on the same day [2]. Group 2: Legal Context - Pomerantz LLP is recognized for its expertise in corporate, securities, and antitrust class litigation, having a long history of advocating for victims of securities fraud and corporate misconduct [3].

Core Viewpoint - An investigation has been announced regarding United Homes Group, Inc. (UHG) for potential violations of federal securities laws, indicating possible legal issues that may affect investors [1] Group 1 - The Law Offices of Howard G. Smith are representing UHG investors who may have suffered losses [1] - Investors are encouraged to contact the law firm to discuss their legal rights and potential claims for recovering losses [1]