Green Brick Partners(US:GRBK)2025-07-30 20:33PART I FINANCIAL INFORMATION Condensed Consolidated Financial Statements (Unaudited) This section presents Green Brick Partners' unaudited condensed consolidated financial statements for Q2 and H1 2025, along with detailed notes Condensed Consolidated Balance Sheets Total assets increased to $2.32 billion, driven by real estate inventory, while liabilities decreased and equity grew Condensed Consolidated Balance Sheets (in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total assets | $2,315,269 | $2,249,994 | | Real estate inventory | $1,976,911 | $1,937,732 | | Cash and cash equivalents | $112,459 | $141,543 | | Total liabilities | $520,367 | $551,831 | | Senior unsecured notes, net | $274,281 | $299,090 | | Total equity | $1,748,935 | $1,653,454 | Condensed Consolidated Statements of Income Q2 2025 revenues slightly decreased to $549.1 million, with net income at $81.9 million, while H1 2025 revenues increased to $1.05 billion, but net income declined to $157.0 million Financial Performance (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | 6M 2025 | 6M 2024 | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $549,147 | $560,631 | $1,046,768 | $1,007,969 | | Total gross profit | $167,514 | $189,666 | $323,299 | $337,923 | | Net income attributable to Green Brick | $81,948 | $105,358 | $157,007 | $188,659 | | Diluted EPS | $1.85 | $2.32 | $3.52 | $4.14 | Condensed Consolidated Statements of Changes in Stockholders' Equity Stockholders' equity increased to $1.73 billion by June 30, 2025, driven by net income, partially offset by stock repurchases and dividends - For the six months ended June 30, 2025, the company recorded net income of $157.0 million, repurchased $60.8 million of its stock, and paid $1.4 million in dividends12 - The company retired 1,027,678 shares of treasury stock during the first six months of 202512 Condensed Consolidated Statements of Cash Flows Net cash from operations significantly increased to $143.5 million for H1 2025, while investing and financing activities resulted in a net cash decrease of $13.9 million Net Cash Flow Summary (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $143,460 | $3,179 | | Net cash (used in) provided by investing activities | $(25,600) | $58,148 | | Net cash used in financing activities | $(131,763) | $(102,610) | | Net decrease in cash | $(13,903) | $(41,283) | Notes to Condensed Consolidated Financial Statements This section details accounting policies and financial data, covering inventory, debt, equity, revenue recognition, segment performance, and subsequent events - Total inventory increased to $1.98 billion as of June 30, 2025, with no impairment charges recorded in 2025 or 202426 - On February 17, 2025, the Board authorized a new $100.0 million stock repurchase program, under which 1,027,678 shares were repurchased for approximately $60.1 million during H1 20254951 - On July 4, 2025, the "One Big Beautiful Bill Act" (OBBBA) was signed into law, and the company is evaluating its financial statement impact7393 Disaggregation of Revenue - Six Months Ended June 30, 2025 (in thousands) | Primary Geographical Market | Residential units revenue | Land and lots revenue | | :--- | :--- | :--- | | Central | $783,215 | $4,342 | | Southeast | $259,211 | $— | | Total revenues | $1,042,426 | $4,342 | Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses financial performance for Q2 and H1 2025, covering home deliveries, sales prices, gross margins, new orders, backlog, land sales, expenses, liquidity, and capital resources Results of Operations Q2 2025 saw increased home deliveries but flat residential revenue due to lower average sales prices and decreased gross margins, with similar trends for H1 2025 Key Operating Metrics vs. Prior Year Period | Metric | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | | :--- | :--- | :--- | | Home deliveries | +5.6% | +8.0% | | Home closings revenue | 0.0% | +5.3% | | Avg. sales price of homes delivered | -5.3% | -2.5% | | Net new home orders | +6.2% | +4.6% | | Homebuilding gross margin % | -410 bps | -320 bps | - The decrease in residential units gross margin for both periods is attributed to higher incentives, discounts, and closing costs105116 - Backlog revenue decreased by 20.6% year-over-year to $516.2 million as of June 30, 2025101103 - The cancellation rate remained low, at 9.9% for Q2 2025 and 7.9% for the six months ended June 30, 2025104115 Lots Owned and Controlled The company owned and controlled 40,200 lots as of June 30, 2025, with 88.2% owned and 98.4% self-developed, reflecting its land strategy Total Lots Owned and Controlled | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total lots owned | 35,468 | 32,716 | | Total lots controlled | 4,732 | 5,115 | | Total lots owned and controlled | 40,200 | 37,831 | - Self-developed lots represent 98.4% of the total lots owned and controlled as of June 30, 2025127 Liquidity and Capital Resources The company maintains strong liquidity with $112.5 million cash and low debt-to-capitalization ratios of 14.4% (gross) and 9.4% (net), sufficient for future operations and growth - As of June 30, 2025, the company had $112.5 million of unrestricted cash and cash equivalents128 - The debt to total capitalization ratio was 14.4% as of June 30, 2025, with a target of up to approximately 20% for growth capital131132 - The net debt to total capitalization ratio, a non-GAAP measure, was 9.4% as of June 30, 2025132147 - As of June 30, 2025, the company had no amounts outstanding under its $35.0 million Secured Revolving Credit Facility or its $330.0 million Unsecured Revolving Credit Facility136137 - As of June 30, 2025, the company had earnest money deposits of $10.2 million at risk for contracts to purchase 3,221 lots with an aggregate price of approximately $217.7 million151 Controls and Procedures Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2025155 - No material changes were made to the company's internal control over financial reporting during the three months ended June 30, 2025156 PART II OTHER INFORMATION Risk Factors This section highlights updated risk factors, including the adverse effects of tariffs on building material costs and home demand, and dependency on mortgage financing availability - The company identifies a risk that recently enacted and potential future tariffs could increase building product costs and adversely affect home demand and margins157 - The U.S. Department of Commerce has indicated it will more than double duties on Canadian softwood lumber imports by September 2025, potentially increasing lumber costs157 - Recent updates to residency requirements for FHA or VA insured mortgages, now limited to permanent U.S. residents, could adversely impact some homebuyers' ability to obtain financing159160 Unregistered Sales of Equity Securities and Use of Proceeds This section details the company's common stock repurchases during Q2 2025, totaling 744,857 shares for $43.4 million under its $100 million repurchase plan Share Repurchases - Q2 2025 | Period | Total shares purchased | Average price paid per share | | :--- | :--- | :--- | | April 2025 | 384,857 | $55.97 | | May 2025 | 360,000 | $60.67 | | June 2025 | — | — | | Total | 744,857 | | - As of June 30, 2025, $39.9 million remained available for repurchase under the company's $100 million stock repurchase plan161 Other Information This section reports no Rule 10b5-1 trading arrangement changes and details the employment agreement for Executive Vice President - Land, Bobby Samuel - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the three months ended June 30, 2025162 - On May 12, 2025, the Company entered into a three-year employment agreement with Bobby Samuel, Executive Vice President - Land, with an annual base salary of $500,000 and a target annual bonus of at least $500,000163164 Exhibits This section lists exhibits filed with the Form 10-Q, including employment agreements, CEO and CFO certifications, and XBRL data files - Exhibits filed include the employment agreement for Bobby L. Samuel III, Sarbanes-Oxley Act certifications from the CEO and CFO, and XBRL interactive data files167