M/I Homes(MHO) - 2025 Q2 - Quarterly Report

Filing Information This section provides the basic filing information for the M/I Homes, Inc. Form 10-Q for the quarterly period ended June 30, 2025 FORM 10-Q Details This section provides the basic filing information for the M/I Homes, Inc. Form 10-Q for the quarterly period ended June 30, 2025, including registrant details, exchange listings, and filer status - Registrant: M/I HOMES, INC., incorporated in Ohio, IRS Employer ID 31-1210837, located at 4131 Worth Avenue, Suite 500, Columbus, Ohio 43219[2] Securities Registered | Title of each class | Trading Symbol(s) | Name of each exchange on which registered | | --- | --- | --- | | Common Shares, par value $.01 | MHO | New York Stock Exchange | - Filer Status: Large accelerated filer[5] - Shares Outstanding: 26,390,709 common shares as of July 23, 2025[6] PART I. FINANCIAL INFORMATION Item 1. Unaudited Condensed Consolidated Financial Statements This section presents the unaudited condensed consolidated financial statements of M/I Homes, Inc. and its subsidiaries for the periods ended June 30, 2025, and December 31, 2024, including balance sheets, statements of income, shareholders' equity, and cash flows, along with detailed notes Unaudited Condensed Consolidated Balance Sheets Total assets increased to $4.74 billion at June 30, 2025, from $4.55 billion at December 31, 2024, primarily due to increased inventory, while total liabilities and shareholders' equity also grew Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | |---|---|---| | Total Assets | $4,740,039 | $4,549,796 | | Total Liabilities | $1,657,903 | $1,610,119 | | Total Shareholders' Equity | $3,082,136 | $2,939,677 | | Cash, cash equivalents and restricted cash | $800,398 | $821,570 | | Inventory | $3,286,606 | $3,091,862 | Unaudited Condensed Consolidated Statements of Income For Q2 2025, revenue increased by 4.8% to $1.16 billion, but net income decreased by 17.4% to $121.2 million, with diluted EPS falling to $4.42 Condensed Consolidated Statements of Income Highlights (in thousands, except per common share amounts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Revenue | $1,162,592 | $1,109,781 | $2,138,685 | $2,156,484 | | Total costs and expenses | $1,002,498 | $915,642 | $1,832,470 | $1,782,106 | | Income before income taxes | $160,094 | $194,139 | $306,215 | $374,378 | | Net income | $121,243 | $146,746 | $232,480 | $284,807 | | Diluted EPS | $4.42 | $5.12 | $8.40 | $9.90 | Unaudited Condensed Consolidated Statements of Shareholders' Equity Shareholders' equity increased to $3.08 billion at June 30, 2025, from $2.94 billion at December 31, 2024, driven by net income, partially offset by share repurchases Shareholders' Equity Changes (in thousands) | Metric | Balance at Dec 31, 2024 | Net Income (6M 2025) | Repurchase of Common Shares (6M 2025) | Balance at Jun 30, 2025 | |---|---|---|---|---| | Total Shareholders' Equity | $2,939,677 | $232,480 | $(100,199) | $3,082,136 | - Repurchased 882,000 common shares for $100.2 million during the six months ended June 30, 2025[14] Unaudited Condensed Consolidated Statements of Cash Flows Net cash provided by operating activities decreased to $102.6 million for H1 2025, primarily due to increased inventory purchases and decreased accrued compensation, while financing activities used significantly more cash due to increased share repurchases Condensed Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30, in thousands) | Activity | 2025 | 2024 | |---|---|---| | Net cash provided by operating activities | $102,642 | $143,283 | | Net cash used in investing activities | $(15,246) | $(27,541) | | Net cash used in financing activities | $(108,568) | $(11,088) | | Net (decrease) increase in cash, cash equivalents and restricted cash | $(21,172) | $104,654 | | Cash, cash equivalents and restricted cash balance at end of period | $800,398 | $837,458 | - Operating cash flow decreased due to $183.6 million increase in inventory purchases and $35.8 million decrease in accrued compensation in H1 2025[15] - Financing cash flow significantly impacted by $100.2 million in common share repurchases in H1 2025 (vs. $75.6 million in H1 2024) and net repayments of $10.2 million in bank borrowings (vs. $56.9 million net proceeds in H1 2024)[15] Notes to Unaudited Condensed Consolidated Financial Statements This section provides detailed explanations and disclosures for the unaudited condensed consolidated financial statements, covering significant accounting policies, inventory valuation, joint ventures, fair value measurements, guarantees, commitments, debt, earnings per share, income taxes, business segments, share repurchase programs, and revenue recognition NOTE 1. Basis of Presentation The financial statements are prepared in accordance with SEC rules for interim financial information and GAAP, requiring management estimates, with no significant changes to critical accounting policies in Q2 2025 - Financial statements prepared under SEC rules for interim information and GAAP, requiring management estimates[17] - ASU 2023-07 (Segment Reporting) is effective and applied retrospectively; ASU 2023-09 (Income Taxes) and ASU 2024-03 (Expense Disaggregation) are being evaluated for future impact[19][20][21] - No significant changes to accounting policies in Q2 2025 compared to 2024 Form 10-K[22] NOTE 2. Inventory and Capitalized Interest Inventory increased to $3.29 billion at June 30, 2025, from $3.09 billion at December 31, 2024, primarily in single-family lots and homes under construction, with capitalized interest remaining consistent at $17.9 million for H1 2025 Inventory Summary (in thousands) | Category | June 30, 2025 | December 31, 2024 | |---|---|---| | Single-family lots, land and land development costs | $1,683,930 | $1,630,190 | | Land held for sale | $5,005 | $7,699 | | Homes under construction | $1,403,582 | $1,271,626 | | Model homes and furnishings - at cost | $94,865 | $88,216 | | Community development district infrastructure | $9,867 | $12,839 | | Land purchase deposits | $76,771 | $69,483 | | Consolidated inventory not owned | $12,586 | $11,809 | | Total inventory | $3,286,606 | $3,091,862 | - Homes under construction not subject to sales contract: 2,726 homes ($585.9 million carrying value) at June 30, 2025, up from 2,502 homes ($551.3 million) at December 31, 2024[25] Capitalized Interest Summary (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Capitalized interest, beginning of period | $38,022 | $32,792 | $35,953 | $32,144 | | Interest capitalized to inventory | $8,947 | $9,004 | $17,917 | $17,954 | | Capitalized interest charged to land and housing costs and expenses | $(8,227) | $(7,938) | $(15,128) | $(16,240) | | Capitalized interest, end of period | $38,742 | $33,858 | $38,742 | $33,858 | | Interest incurred - net | $4,570 | $1,656 | $8,343 | $3,686 | NOTE 3. Investment in Joint Venture Arrangements The Company's investment in joint venture arrangements increased by $2.2 million to $67.5 million at June 30, 2025, primarily due to cash contributions offset by lot distributions Investment in Joint Venture Arrangements (in thousands) | Metric | June 30, 2025 | December 31, 2024 | |---|---|---| | Total Investment in Joint Venture Arrangements | $67,466 | $65,334 | | Investment in JODAs | $59,100 | $59,300 | | Investment in LLCs | $8,400 | $6,000 | - Increase of $2.2 million in joint venture investments during H1 2025, driven by $18.4 million cash contributions offset by $16.2 million lot distributions[30] - No losses or income from LLCs during the three and six months ended June 30, 2025 or 2024[33] NOTE 4. Fair Value Measurements The Company measures mortgage loans held for sale and interest rate lock commitments (IRLCs) at fair value, recognizing a total gain of $1.6 million from these instruments for the six months ended June 30, 2025 - Mortgage loans held for sale and IRLCs are measured at fair value on a recurring basis, using Level 2 and Level 3 inputs[39][42] Gain (Loss) Recognized on Fair Value Measurements (in thousands) | Description | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Mortgage loans held for sale | $5,544 | $(623) | $5,452 | $(3,471) | | Forward sales of mortgage-backed securities | $(3,701) | $1,647 | $(9,144) | $8,888 | | Interest rate lock commitments | $1,404 | $(1,322) | $4,621 | $(2,179) | | Whole loan contracts | $1,235 | $843 | $644 | $(49) | | Total gain (loss) recognized | $4,482 | $545 | $1,573 | $3,189 | - No impairment charges recorded on inventory or investments in unconsolidated joint ventures during the three and six months ended June 30, 2025 and 2024[52][53] NOTE 5. Guarantees and Indemnifications M/I Financial provides limited-life guarantees on loans sold to third-party purchasers, covering approximately $738.3 million in loans as of June 30, 2025, with a recorded liability of $1.0 million for these guarantees - Loans covered by limited-life guarantees decreased to $738.3 million at June 30, 2025, from $936.0 million at December 31, 2024, due to a change in investor mix and purchase terms[62] - Liability for guarantees totaled $1.0 million at June 30, 2025, compared to $1.3 million at December 31, 2024[65] NOTE 6. Commitments and Contingencies The Company maintains warranty reserves of $35.2 million, has outstanding completion bonds and standby letters of credit totaling $536.6 million, and land option/contingent purchase agreements of approximately $1.56 billion, with a legal expense reserve of $1.4 million Warranty Reserves Activity (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Warranty reserves, beginning of period | $35,043 | $32,263 | $36,219 | $31,980 | | Warranty expense on homes delivered | $6,288 | $5,904 | $11,549 | $11,503 | | Changes in estimates for pre-existing warranties | $45 | $580 | $(54) | $605 | | Settlements made during the period | $(6,144) | $(5,686) | $(12,482) | $(11,027) | | Warranty reserves, end of period | $35,232 | $33,061 | $35,232 | $33,061 | - Outstanding completion bonds and standby letters of credit: $536.6 million at June 30, 2025[70] - Land option and contingent purchase agreements: approximately $1.56 billion at June 30, 2025[71] - Legal expense reserve: $1.4 million at June 30, 2025, up from $1.2 million at December 31, 2024[72] NOTE 7. Goodwill Goodwill of $16.4 million, from the 2018 Pinnacle Homes acquisition, remained unchanged at June 30, 2025, with no impairment recorded - Goodwill balance: $16.4 million at June 30, 2025, unchanged from December 31, 2024[73] - No goodwill impairment recorded in Q4 2024 or at June 30, 2025[74] NOTE 8. Debt The Company maintains a $650 million unsecured revolving Credit Facility with $561.5 million available, a $300 million MIF Mortgage Repurchase Facility with $275.9 million outstanding, and Senior Notes totaling $700 million, all in compliance with covenants as of June 30, 2025 - Credit Facility: $650 million unsecured revolving credit facility, maturing December 9, 2026; $561.5 million available at June 30, 2025 (no borrowings, $88.5 million letters of credit outstanding)[75][76] - MIF Mortgage Repurchase Facility: $300 million maximum borrowing availability, expiring October 21, 2025; $275.9 million outstanding at June 30, 2025[79][80] - Senior Notes: $300 million of 3.95% notes due 2030 and $400 million of 4.95% notes due 2028 outstanding[81][82] - All financial covenants for Credit Facility, 2030 Senior Notes, and 2028 Senior Notes were in compliance at June 30, 2025[75][83][84] - Restricted payments basket for 2028 Senior Notes was $904.3 million at June 30, 2025, up from $900.2 million at December 31, 2024[86] NOTE 9. Earnings Per Common Share Diluted earnings per common share decreased to $4.42 for Q2 2025 and $8.40 for H1 2025, reflecting a decline in net income Earnings Per Common Share (in thousands, except per common share amounts) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Net income | $121,243 | $146,746 | $232,480 | $284,807 | | Basic weighted average shares outstanding | 26,836 | 27,878 | 27,074 | 27,965 | | Diluted weighted average shares outstanding | 27,406 | 28,668 | 27,673 | 28,777 | | Basic EPS | $4.52 | $5.26 | $8.59 | $10.18 | | Diluted EPS | $4.42 | $5.12 | $8.40 | $9.90 | NOTE 10. Income Taxes The effective tax rate for Q2 2025 was 24.3% and for H1 2025 was 24.1%, with a $1.7 million tax benefit from energy efficient homes credit in H1 2025 Effective Tax Rates | Period | Effective Tax Rate 2025 | Effective Tax Rate 2024 | |---|---|---| | Three Months Ended June 30 | 24.3% | 24.4% | | Six Months Ended June 30 | 24.1% | 23.9% | - Recognized $1.7 million tax benefit for energy efficient homes credit in H1 2025, up from $1.3 million in H1 2024[88] - The One Big Beautiful Bill Act (OBBBA) accelerated the termination date of the energy efficient homes credit to June 30, 2026[88] NOTE 11. Business Segments Northern homebuilding revenue increased by 5.1% to $488.3 million in Q2 2025, while Southern homebuilding revenue increased by 4.7% to $642.9 million, but Southern operating income decreased by 29.6% due to lower gross margins Segment Revenue (in thousands) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Northern homebuilding | $488,250 | $464,781 | $898,627 | $873,301 | | Southern homebuilding | $642,892 | $614,238 | $1,177,088 | $1,225,459 | | Financial services | $31,450 | $30,762 | $62,970 | $57,724 | | Total revenue | $1,162,592 | $1,109,781 | $2,138,685 | $2,156,484 | Segment Operating Income (in thousands) | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Northern homebuilding | $76,014 | $72,821 | $136,606 | $130,882 | | Southern homebuilding | $84,300 | $119,750 | $164,731 | $237,593 | | Financial services | $17,542 | $17,883 | $36,309 | $33,070 | | Total operating income | $155,717 | $186,791 | $296,641 | $360,110 | Total Assets by Segment (in thousands) | Segment | June 30, 2025 | December 31, 2024 | |---|---|---| | Northern | $1,145,236 | $1,091,643 | | Southern | $2,406,481 | $2,235,590 | | Financial Services | $377,271 | $370,558 | | Corporate and Unallocated | $811,051 | $852,005 | | Total assets | $4,740,039 | $4,549,796 | NOTE 12. Share Repurchase Program A new $250 million share repurchase program was approved in February 2025, under which the Company repurchased 0.5 million shares for $50.1 million in Q2 2025, leaving $149.8 million available - New $250 million share repurchase program approved on February 11, 2025, replacing the 2024 program[99] - Repurchased 0.5 million common shares for $50.1 million in Q2 2025[101] - $149.8 million remained available for repurchases under the 2025 Share Repurchase Program as of June 30, 2025[101] NOTE 13. Revenue Recognition Revenue from home and land sales is recognized at closing, while financial services revenue is recognized upon sale of mortgage loans/servicing rights or rendering of title services Revenue Disaggregated by Source (in thousands) | Revenue Source | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Housing | $1,124,475 | $1,072,044 | $2,064,506 | $2,088,557 | | Land sales | $6,667 | $6,975 | $11,209 | $10,203 | | Financial services | $31,450 | $30,762 | $62,970 | $57,724 | | Total revenue | $1,162,592 | $1,109,781 | $2,138,685 | $2,156,484 | - Homebuilding operations accounted for 97% of total revenues for both three and six months ended June 30, 2025 and 2024[110] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides an overview of the Company's financial performance and condition, highlighting the impact of macroeconomic challenges, results by homebuilding regions and financial services, critical accounting estimates, and strategic objectives for 2025 - Company is one of the nation's leading builders of single-family homes, having sold over 164,300 homes since 1976[111] - Housing market faces headwinds from elevated mortgage interest rates, higher lot costs, limited affordable housing, and economic uncertainty, leading to decreased buyer urgency[118] Key Financial and Operational Highlights (Q2 and H1 2025 vs. 2024) | Metric | Q2 2025 | Q2 2024 | Change (YoY) | H1 2025 | H1 2024 | Change (YoY) | |---|---|---|---|---|---|---| | Revenue | $1.16B | $1.11B | +5% | $2.14B | $2.16B | -1% | | Homes Delivered | 2,348 | 2,224 | +6% | 4,324 | 4,382 | -1% | | Income Before Taxes | $160.1M | $194.1M | -18% | $306.2M | $374.4M | -18% | | Gross Margins | 24.7% | 27.9% | -320 bps | 25.2% | 27.5% | -230 bps | | Net Income | $121.2M | $146.7M | -17% | $232.5M | $284.8M | -18% | | New Contracts | 2,078 | 2,255 | -8% | 4,370 | 4,802 | -9% | | Shareholders' Equity | $3.1B | $2.74B | +12% | $3.1B | $2.74B | +12% | | Book Value per Share | $117 | $100 | +17% | $117 | $100 | +17% | | Homebuilding Debt to Capital | 18% | 20% | -200 bps | 18% | 20% | -200 bps | - Financial services achieved record quarterly revenue and strong H1 income, benefiting from higher margins, improved capture rate, and increased loan originations[119] - Company-wide absorption pace declined to 3.0 sales per community per month in Q2 2025 compared to 3.5 in Q2 2024[120] - Strategic objectives for remainder of 2025 include promoting sales with incentives, managing land spend and inventory, controlling construction cycle times, opening new communities, managing overhead, maintaining a strong balance sheet, and emphasizing customer service, product quality, and premier locations[131] - Ended Q2 2025 with approximately 50,500 lots under control (a six-year supply), a 2% increase from Q2 2024[132] - Opened 50 new communities and closed 36 in H1 2025, ending Q2 with 234 active communities (up from 211 YoY); expects 5% growth in average community count by end of 2025[133] Overview M/I Homes, Inc. is a leading single-family homebuilder operating in 16 markets, with this section introducing key topics of the Management's Discussion and Analysis, including forward-looking statements, critical accounting estimates, results of operations, liquidity, capital resources, and the impact of interest rates and inflation - M/I Homes, Inc. is a leading builder of single-family homes, having sold over 164,300 homes since 1976[111] - The Company operates homebuilding operations in 16 markets across Ohio, Indiana, Illinois, Minnesota, Michigan, Florida, Texas, North Carolina, and Tennessee[111] Application of Critical Accounting Estimates and Policies The preparation of financial statements requires management to make estimates and assumptions in accordance with GAAP, with no significant changes to critical accounting policies made during Q2 2025 - Financial statements require management estimates and assumptions based on historical experience and other reasonable factors[115] - No significant changes to critical accounting policies in Q2 2025 compared to the 2024 Form 10-K[116] Results of Operations The Company's Q2 2025 revenue increased 5% to $1.16 billion, driven by a 6% increase in homes delivered, despite an 18% decrease in income before taxes and net income due to lower gross margins and increased incentives Key Financial and Operational Highlights (Q2 and H1 2025 vs. 2024) | Metric | Q2 2025 | Q2 2024 | Change (YoY) | H1 2025 | H1 2024 | Change (YoY) | |---|---|---|---|---|---|---| | Revenue | $1.16B | $1.11B | +5% | $2.14B | $2.16B | -1% | | Homes Delivered | 2,348 | 2,224 | +6% | 4,324 | 4,382 | -1% | | Income Before Taxes | $160.1M | $194.1M | -18% | $306.2M | $374.4M | -18% | | Gross Margins | 24.7% | 27.9% | -320 bps | 25.2% | 27.5% | -230 bps | | Net Income | $121.2M | $146.7M | -17% | $232.5M | $284.8M | -18% | | New Contracts | 2,078 | 2,255 | -8% | 4,370 | 4,802 | -9% | - Homebuilding gross margin percentage declined by 320 basis points to 22.6% in Q2 2025, primarily due to a $16.7 million increase in lot costs and an $8.7 million increase in interest rate buydowns[122] - Financial services revenue increased 2% in Q2 2025 to a record $31.5 million, driven by higher margins, improved capture rate, and a 15% increase in loan originations[151] Cancellation Rates by Region | Region | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | |---|---|---|---|---| | Northern | 10.7 % | 9.3 % | 9.1 % | 8.2 % | | Southern | 14.0 % | 10.2 % | 12.9 % | 9.7 % | | Total | 12.7 % | 9.8 % | 11.3 % | 9.0 % | - Northern region revenue increased 5% in Q2 2025, driven by a 3% increase in average sales price and a 2% increase in homes delivered; operating income increased 4.4%[144] - Southern region revenue increased 5% in Q2 2025 due to an 8% increase in homes delivered, but operating income decreased 29.6% due to a 550 basis points decline in gross margin (to 22.4%) from increased lot costs and incentives[148] Liquidity and Capital Resources Cash, cash equivalents, and restricted cash decreased by $21.3 million to $800.4 million at June 30, 2025, primarily due to lower home deliveries and land spend timing, with key uses of cash including land acquisitions, land development, and share repurchases - Cash, cash equivalents and restricted cash decreased by $21.3 million to $800.4 million at June 30, 2025, from December 31, 2024[168] - Principal uses of cash in H1 2025: $247.7 million in land acquisitions, $240.6 million in land development, and $100.2 million in common share repurchases[168][172][177] - Credit Facility: $650 million, $561.5 million available at June 30, 2025 (no borrowings, $88.5 million letters of credit outstanding)[171] - MIF Mortgage Repurchase Facility: $300 million, $275.9 million outstanding at June 30, 2025[170] - Homebuilding debt to capital ratio: 18% at June 30, 2025 (vs. 19% at Dec 31, 2024)[180] Credit Facility Covenants Compliance (as of June 30, 2025, in millions) | Financial Covenant | Requirement | Actual | |---|---|---| | Consolidated Tangible Net Worth | ≥ $1,901.2 | $2,989.5 | | Leverage Ratio | ≤ 0.60 | — | | Interest Coverage Ratio | ≥ 1.5 to 1.0 | 21.73 to 1.0 | | Investments in Unrestricted Subsidiaries and Joint Ventures | ≤ $896.8 | $8.8 | | Unsold Housing Units and Model Homes | ≤ 3,149 | 1,922 | MIF Mortgage Repurchase Facility Covenants Compliance (as of June 30, 2025, in millions) | Financial Covenant | Requirement | Actual | |---|---|---| | Leverage Ratio | ≤ 12.0 to 1.0 | 7.26 to 1.0 | | Liquidity | ≥ $10.0 | $58.5 | | Adjusted Net Income | > $0.0 | $29.2 | | Tangible Net Worth | ≥ $25.0 | $43.5 | Impact of Interest Rates and Inflation The Company's business is significantly affected by interest rates and inflation, with the annual inflation rate at 2.7% in June 2025 and mortgage rates remaining elevated between 6% and 7%, leading to the use of interest rate buydowns - Annual inflation rate (CPI) was 2.7% in June 2025, down from 3.0% in June 2024[209] - Mortgage interest rates hover between 6% and 7%, comparable to prior year, making it difficult for homebuyers[210] - Company offers interest rate buydowns to address elevated rates and spur demand, which may reduce margins[210] Item 3. Quantitative and Qualitative Disclosures About Market Risk The Company's primary market risk stems from interest rate fluctuations, which it hedges using derivative instruments like Forward Sales of Mortgage-Backed Securities (FMBSs) and Whole Loan Contracts, recognizing a total gain of $1.6 million from these instruments for H1 2025 - Primary market risk is from interest rate fluctuations affecting revolving credit facilities and mortgage loan origination[212] - Uses FMBSs and Whole Loan Contracts to hedge interest rate risk for IRLCs and Mortgage Loans Held for Sale[215][216] Notional Amounts of Financial Instruments (in thousands) | Description | June 30, 2025 | December 31, 2024 | |---|---|---| | Whole loan contracts and related committed IRLCs | $1,012 | $— | | Uncommitted IRLCs | $317,593 | $215,696 | | FMBSs related to uncommitted IRLCs | $372,000 | $228,000 | | Whole loan contracts and related mortgage loans held for sale | $16,841 | $17,667 | | FMBSs related to mortgage loans held for sale | $258,000 | $252,000 | | Mortgage loans held for sale covered by FMBSs | $267,599 | $276,140 | Gain (Loss) Recognized on Financial Instruments (in thousands) | Description | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | |---|---|---|---|---| | Mortgage loans held for sale | $5,544 | $(623) | $5,452 | $(3,471) | | Forward sales of mortgage-backed securities | $(3,701) | $1,647 | $(9,144) | $8,888 | | Interest rate lock commitments | $1,404 | $(1,322) | $4,621 | $(2,179) | | Whole loan contracts | $1,235 | $843 | $644 | $(49) | | Total gain (loss) recognized | $4,482 | $545 | $1,573 | $3,189 | Item 4. Controls and Procedures Management concluded that the Company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting during the quarter - Disclosure controls and procedures were effective as of June 30, 2025[220] - No material changes in internal control over financial reporting during Q2 2025[221] PART II. OTHER INFORMATION Item 1. Legal Proceedings Information regarding the Company's legal proceedings is incorporated by reference from Note 6 to the Condensed Consolidated Financial Statements - Legal proceedings are discussed in Note 6 to the Company's Consolidated Financial Statements[222] Item 1A. Risk Factors The Company's business is subject to various risks and uncertainties, which are consistent with those disclosed in the 2024 Form 10-K, with no material changes reported in this quarterly filing - No material changes to the risk factors disclosed in the 2024 Form 10-K[223] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The Company did not have any unregistered sales of equity securities, but repurchased 460,000 common shares for $50.1 million in Q2 2025 under its 2025 Share Repurchase Program, leaving $149.8 million available - No unregistered sales of equity securities[224] Common Shares Purchased (Q2 2025) | Period | Total Number of Shares Purchased | Average Price Paid per Common Share | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs | |---|---|---|---| | April 1, 2025 - April 30, 2025 | 40,000 | $105.17 | $195,738,273 | | May 1, 2025 - May 31, 2025 | 420,000 | $109.37 | $149,801,549 | | June 1, 2025 - June 30, 2025 | — | $— | $149,801,549 | | Quarter ended June 30, 2025 | 460,000 | $109.01 | $149,801,549 | - The 2025 Share Repurchase Program, authorized for up to $250 million, replaced the 2024 program[225] Item 3. Defaults Upon Senior Securities The Company reported no defaults upon senior securities during the period - No defaults upon senior securities[228] Item 4. Mine Safety Disclosures The Company reported no mine safety disclosures - No mine safety disclosures[229] Item 5. Other Information No director or officer adopted, modified, or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during Q2 2025 - No director or officer adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement in Q2 2025[229] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including an amendment to a master repurchase agreement, a list of subsidiary guarantors, and various certifications by the CEO and CFO, along with XBRL documents Key Exhibits Filed | Exhibit Number | Description | |---|---| | 10.1 | Amendment No. 3 to Master Repurchase Agreement between M/I Financial, LLC and JPMorgan Chase Bank, National Association, dated July 1, 2025 | | 22 | List of Subsidiary Guarantors | | 31.1, 31.2 | Certifications by Robert H. Schottenstein (CEO) and Phillip G. Creek (CFO) pursuant to Sarbanes-Oxley Act Section 302 | | 32.1, 32.2 | Certifications by Robert H. Schottenstein (CEO) and Phillip G. Creek (CFO) pursuant to Sarbanes-Oxley Act Section 906 | | 101.INS, 101.SCH, 101.CAL, 101.LAB, 101.PRE, 101.DEF | XBRL Instance Document and Taxonomy Extensions | | 104 | Cover Page Interactive Data File | Signatures Signatures The report is signed by Robert H. Schottenstein, Chairman, Chief Executive Officer and President, and Ann Marie W. Hunker, Vice President, Chief Accounting Officer and Controller, on July 25, 2025 - Report signed by Robert H. Schottenstein (Chairman, CEO and President) and Ann Marie W. Hunker (VP, Chief Accounting Officer and Controller) on July 25, 2025[233]