Forestar (US:FOR)2024-11-19 18:00Financial Performance - Revenues for fiscal 2024 increased by 5% to $1,509.4 million compared to $1,436.9 million in fiscal 2023[181]. - The company reported a net income before income taxes of $270.1 million for fiscal 2024, up from $221.6 million in fiscal 2023[181]. - Net income rose to $203.4 million for the year ended September 30, 2024, compared to $166.9 million in 2023, reflecting a growth of 21.8%[278]. - Basic net income per share increased to $4.03 in 2024, up from $3.34 in 2023, marking a 20.7% increase[278]. - The effective tax rate for fiscal 2024 was 24.7%, consistent with the rate in 2023[349]. Sales and Revenue Generation - The average sales price per residential lot rose to $96,600 in fiscal 2024 from $90,900 in fiscal 2023, reflecting improved demand[182]. - Residential lots sold increased to 15,068 in fiscal 2024 from 14,040 in fiscal 2023, with sales to D.R. Horton rising to 13,267 lots[185]. - Revenues from residential lot sales reached $1,459.3 million in fiscal 2024, compared to $1,275.7 million in fiscal 2023[325]. Expenses and Costs - Selling, general and administrative (SG&A) expenses increased to $118.5 million in fiscal 2024, representing 7.9% of revenues compared to 6.8% in fiscal 2023[192]. - For the year ended September 30, 2024, the company's cost of sales was approximately $1.15 billion, which included costs related to land and lot acquisition, land development, and related expenses[266]. - The company experienced an increase in accrued development costs to $144.6 million in 2024, up from $104.1 million in 2023, a rise of 38.9%[274]. Assets and Liabilities - Total assets increased to $2,840.1 million as of September 30, 2024, up from $2,470.7 million in 2023, representing a growth of 14.0%[274]. - Total liabilities increased to $1,245.0 million as of September 30, 2024, compared to $1,100.8 million in 2023, an increase of 13.1%[274]. - Stockholders' equity increased to $1,595.1 million as of September 30, 2024, compared to $1,369.9 million in 2023, representing a growth of 16.5%[274]. Cash Flow and Financing - In fiscal 2024, net cash used in operating activities was $158.4 million, a decrease from $364.1 million in fiscal 2023[214]. - The company reported net cash provided by investing activities of $7.3 million in fiscal 2024, compared to $0.3 million in fiscal 2023[215]. - Net cash provided by financing activities was $16.3 million in fiscal 2024, an increase from cash used in financing activities of $13.2 million in fiscal 2023[216]. - Cash and cash equivalents stood at $481.2 million with an additional $377.2 million available on the revolving credit facility as of September 30, 2024[200]. Debt and Credit Facilities - The company's debt to total capital ratio improved to 30.7% in fiscal 2024 from 33.7% in fiscal 2023, indicating a stronger liquidity position[201]. - The company has a $410 million senior unsecured revolving credit facility, with an available capacity of $377.2 million as of September 30, 2024[203]. - The company has $400 million principal amount of 3.85% senior notes maturing on May 15, 2026, with an annual effective interest rate of 4.1%[207]. - The company also has $300 million principal amount of 5.0% senior notes maturing on March 1, 2028, with an annual effective interest rate of 5.2%[208]. Compliance and Internal Controls - The company was in compliance with all financial covenants associated with its revolving credit facility as of September 30, 2024[205]. - The company maintained effective internal control over financial reporting as of September 30, 2024, according to management's assessment[246]. - Ernst & Young LLP expressed an unqualified opinion on the company's consolidated financial statements for the years ended September 30, 2024, and 2023[261]. Strategic Relationships and Market Position - The company plans to remain disciplined in land investments and manage lot sales pace to optimize returns amid market conditions[178]. - The company’s strategic relationship with D.R. Horton may impact its ability to maintain customer relationships and achieve strategic initiatives[235]. - D.R. Horton owned approximately 62% of Forestar's outstanding common stock as of September 30, 2024, down from 75% post-merger in October 2017[291]. Future Outlook and Investments - The company anticipates entering into a new at-the-market equity offering program under its September 2024 shelf registration statement[213]. - The Company invested $570.0 million in the acquisition of residential real estate and $1.0 billion in the development of residential real estate during fiscal 2024[322].