Legacy Housing(LEGH) - 2025 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) This section presents Legacy Housing Corporation's unaudited condensed financial statements, including balance sheets, income statements, statements of changes in stockholders' equity, and cash flow statements, along with detailed notes explaining accounting policies, revenue recognition, loan portfolios, and other financial disclosures for the periods ended June 30, 2025, and December 31, 2024 Condensed Balance Sheets This section provides a summary of the company's financial position, detailing total assets, liabilities, and stockholders' equity at specific reporting dates | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------------- | :----------------------------- | :------------------------------- | | Total Assets | $551,985 | $534,194 | | Total Liabilities | $39,205 | $40,238 | | Total Stockholders' Equity | $512,780 | $493,956 | - Total assets increased by $17.79 million (3.33%) from December 31, 2024, to June 30, 2025, primarily driven by increases in consumer loans receivable, net, and property, plant and equipment, net[8] - Total liabilities decreased by $1.03 million (2.57%) over the same period, mainly due to a reduction in accounts payable and accrued liabilities[8] Condensed Statements of Income This section outlines the company's financial performance over specific periods, detailing total net revenue, income from operations, net income, and earnings per share | Metric (in thousands) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Net Revenue | $50,161 | $42,495 | $85,831 | $85,738 | | Income from Operations| $16,817 | $16,030 | $28,408 | $32,780 | | Net Income | $14,695 | $16,189 | $24,971 | $31,329 | | Basic EPS | $0.61 | $0.67 | $1.04 | $1.29 | | Diluted EPS | $0.60 | $0.65 | $1.01 | $1.26 | - For the three months ended June 30, 2025, total net revenue increased by 18.0% year-over-year, while net income decreased by 9.2%[10] - For the six months ended June 30, 2025, total net revenue remained relatively flat (0.1% increase) year-over-year, but net income decreased by 20.3%[10] Condensed Statements of Changes in Stockholders' Equity This section details the changes in the company's equity over time, reflecting impacts from net income, treasury stock transactions, and other capital adjustments | Metric (in thousands) | December 31, 2024 | March 31, 2025 | June 30, 2025 | | :-------------------- | :---------------- | :------------- | :------------ | | Total Stockholders' Equity | $493,956 | $503,728 | $512,780 | | Retained Earnings | $321,400 | $331,676 | $346,371 | | Treasury Stock | $(9,875) | $(10,550) | $(16,367) | - Stockholders' equity increased from $493.96 million at December 31, 2024, to $512.78 million at June 30, 2025, primarily driven by net income and additional paid-in capital, partially offset by treasury stock purchases[12][14] Condensed Statements of Cash Flows This section summarizes the cash inflows and outflows from operating, investing, and financing activities, showing the net change in cash over specific periods | Cash Flow Activity (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $10,970 | $14,265 | | Net cash (used in) provided by investing activities | $(3,138) | $2,142 | | Net cash used in financing activities | $(6,350) | $(17,095) | | Net increase (decrease) in cash | $1,482 | $(688) | | Cash at end of period | $2,631 | $60 | - Net cash provided by operating activities decreased by $3.295 million (23.1%) for the six months ended June 30, 2025, compared to the same period in 2024[16] - Investing activities shifted from providing $2.142 million in cash in 2024 to using $3.138 million in 2025, mainly due to increased purchases of property, plant, and equipment and issuance of notes receivable[16] Notes to Condensed Financial Statements This section provides detailed explanations and additional information supporting the condensed financial statements, covering accounting policies, revenue, and loan portfolios 1. Nature of Operations This note describes the company's primary business activities, including manufacturing, sales, and financing of manufactured homes, and its single reportable segment structure - Legacy Housing Corporation manufactures and transports mobile homes, provides wholesale financing to dealers and mobile home parks, offers retail financing to consumers, and is involved in financing and developing new manufactured home communities[19] - The Company operates as a single reportable segment, with its Chief Executive Officer evaluating performance based on consolidated net income, total revenue, and return on investment[22] Revenue Recognition This note details the company's policies for recognizing revenue from various sources, including product sales and interest income from financing portfolios - Product sales include Direct Sales, Commercial Sales, Inventory Finance Sales, and Retail Store Sales, with revenue recognized upon delivery and transfer of title[24] - Consumer, MHP, and dealer loans interest income is recognized from financing portfolios, while other revenue includes contract deposit forfeitures, consignment fees, commercial lease rents, and land sales[25] Accounts Receivable This note provides information on the company's accounts receivable, including net balances and the allowance for doubtful accounts, reflecting collectibility estimates | Metric (in thousands) | June 30, 2025 | December 31, 2024 | December 31, 2023 | | :-------------------- | :------------ | :---------------- | :---------------- | | Accounts receivable, net | $4,197 | $3,985 | $4,656 | | Allowance for doubtful accounts | $866 | $578 | $651 | - Accounts receivable, net, increased by $212 thousand (5.32%) from December 31, 2024, to June 30, 2025[27] - The allowance for doubtful accounts increased by $288 thousand (49.83%) over the same period, reflecting management's estimate of uncollectible amounts[27] Leased Property This note describes the company's operating lease arrangements for mobile homes and presents the future minimum lease income expected from these agreements - The Company leases mobile homes to park operators under operating leases, typically for 96 or 120 months, with options for termination, extension, or purchase[28][29] | Year | Future Minimum Lease Income (in thousands) | | :--- | :--------------------------------------- | | 2025 | $549 | | 2026 | $1,098 | | 2027 | $926 | | 2028 | $770 | | 2029 | $495 | | Thereafter | $232 | | Total | $4,070 | Product Warranties This note details the company's product warranty policy, including the accrual of warranty costs based on historical data and estimated future expenses - The Company provides a one-year warranty on manufactured homes, accruing costs when homes are sold based on historical data and estimated costs[33] | Metric (in thousands) | 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 liability, beginning of period | $2,033 | $3,314 | $1,950 | $2,910 | | Product warranty reserve accrued (released) | $577 | $(579) | $1,153 | $257 | | Warranty costs incurred | $(490) | $(381) | $(983) | $(813) | | Warranty liability, end of period | $2,120 | $2,354 | $2,120 | $2,354 | Share-Based Compensation This note explains the company's accounting for share-based compensation, including the valuation methods used and the recognition of related expenses over vesting periods - Share-based compensation expense is recognized over the vesting period, with fair value estimated using the Black-Scholes model for options and closing stock price for restricted stock[35][36][37] | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total share based compensation expense | $174 | $174 | $344 | $431 | - As of June 30, 2025, approximately 1,013,000 options were outstanding, with $3.89 million in unrecognized compensation expense expected to be recognized over 6.7 years[40] Fair Value Measurements This note describes the methodologies used to determine the fair value of the company's financial instruments, categorizing them into Level I, II, and III based on input observability - The Company's financial instruments like cash, accounts receivable, and accounts payable are valued at fair value approximating carrying value (Level I)[44] - Variable interest rate instruments (MHP Notes, other notes, lines of credit) are considered Level II, while fixed-rate consumer loans and MHP/other notes are valued using discounted cash flows (Level III)[119] Recent Accounting Pronouncements This note outlines the impact of recently adopted and upcoming accounting standards on the company's financial reporting and disclosures - The Company adopted ASU 2023-07 (Segment Reporting) retrospectively for annual periods starting December 31, 2024, enhancing segment disclosures[48] - ASU 2023-09 (Income Tax Disclosures) and ASU 2024-03 (Expense Disaggregation Disclosures) are not yet adopted, with the Company currently evaluating their potential impact[49][50] 2. Revenue This note provides a detailed breakdown of the company's revenue streams, including various product sales categories and interest income from loan portfolios | Revenue Source (in thousands) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Direct sales | $2,804 | $3,372 | $4,293 | $5,167 | | Commercial sales | $11,844 | $11,248 | $18,640 | $24,850 | | Inventory finance sales | $14,030 | $9,154 | $25,161 | $17,618 | | Retail store sales | $7,292 | $4,441 | $10,633 | $9,236 | | Other product sales | $2,417 | $3,437 | $3,950 | $5,613 | | Total product sales | $38,387 | $31,652 | $62,677 | $62,484 | | Total loan portfolio interest | $10,883 | $9,844 | $21,538 | $20,477 | | Other revenue | $891 | $999 | $1,616 | $2,777 | | Total net revenue | $50,161 | $42,495 | $85,831 | $85,738 | - For the three months ended June 30, 2025, inventory finance sales increased by 53.3% and retail store sales increased by 64.2% year-over-year[61] - For the six months ended June 30, 2025, commercial sales decreased by 25.0% year-over-year, while inventory finance sales increased by 42.8% and retail sales increased by 15.1%[61] 3. Consumer Loans Receivable This note details the company's consumer loan portfolio, including balances, average interest rates, allowance for loan losses, and past due amounts - Consumer loans receivable, with an average contractual interest rate of 13.1%, increased to $190.08 million as of June 30, 2025, from $177.29 million at December 31, 2024[62][71] | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Allowance for loan losses | $1,203 | $694 | | Provision for loan losses (Six Months Ended June 30) | $922 | $(421) | | Total past due (>30 days) | $5,834 | $5,893 | - The allowance for loan losses for consumer loans increased by $509 thousand (73.3%) from December 31, 2024, to June 30, 2025, with a provision for loan losses of $922 thousand for the six months ended June 30, 2025[73] 4. Notes Receivable from Mobile Home Parks (MHP) This note provides information on notes receivable from mobile home parks, including balances, interest rates, loan loss allowances, and details of a significant settlement agreement - MHP Notes, with an average interest rate of 7.9%, decreased slightly to $204.91 million as of June 30, 2025, from $208.18 million at December 31, 2024[75][86] | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Allowance for loan losses | $900 | $654 | | Provision for loan losses (Six Months Ended June 30) | $246 | $(24) | | Past due balances | $103 | $17 | - A settlement agreement in July 2024 resulted in the conveyance of two mobile home communities to Legacy and the refinancing of remaining debt into a new two-year, $48.6 million Promissory Note[79][87] 5. Other Notes Receivable This note details other notes receivable not directly tied to mobile home sales, including balances, loan loss allowances, and concentrations with third parties - Other notes receivable, not directly tied to mobile home sales, decreased to $12.99 million as of June 30, 2025, from $15.41 million at December 31, 2024[90][96] | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Allowance for loan losses | $432 | $364 | | Provision for loan losses (Six Months Ended June 30) | $68 | $(25) | | Past due balances | $1,704 | $1,357 | - Concentrations of other notes receivable with three independent third-parties accounted for 40.0%, 27.0%, and 7.9% of the principal balance outstanding as of June 30, 2025[92] 6. Dealer Financed Receivables This note provides information on dealer financed receivables, which are part of the company's inventory finance program, including balances and loan loss allowances - Dealer financed receivables, part of the inventory finance program, remained stable at $32.76 million as of June 30, 2025, compared to $32.78 million at December 31, 2024[99][100] | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Allowance for loan losses | $295 | $194 | | Provision for loan losses (Six Months Ended June 30) | $101 | $(267) | 7. Inventories, Net This note details the composition of the company's inventories, including raw materials, work in progress, and finished goods, and changes over time | Inventory Category (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Raw materials | $13,914 | $13,172 | | Work in progress | $410 | $478 | | Finished goods, net | $26,198 | $23,888 | | Total | $40,522 | $37,538 | - Total inventories, net, increased by $2.98 million (7.95%) from December 31, 2024, to June 30, 2025, primarily due to an increase in finished goods[104] 8. Property, Plant and Equipment This note provides a breakdown of the company's property, plant, and equipment, including land and construction in progress, and changes in their net values | Category (in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------- | :------------ | :---------------- | | Land | $19,537 | $17,025 | | Construction in Progress| $23,103 | $19,719 | | Total Property, Plant and Equipment, net | $53,012 | $47,585 | - Net property, plant and equipment increased by $5.43 million (11.4%) from December 31, 2024, to June 30, 2025, driven by increases in land and construction in progress[105] 9. Other Assets This note details the composition of other assets, primarily focusing on repossessed homes, and explains the changes in their balances over time | Category (in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------- | :------------ | :---------------- | | Repossessed homes | $7,582 | $5,129 | | Total Other Assets | $7,938 | $5,485 | - Other assets increased by $2.45 million (44.7%) from December 31, 2024, to June 30, 2025, primarily due to a significant increase in repossessed homes from both consumer and MHP loan portfolios[107] 10. Accrued Liabilities This note provides a breakdown of the company's accrued liabilities, including warranty reserves, litigation reserves, and federal and state income taxes | Category (in thousands) | June 30, 2025 | December 31, 2024 | | :---------------------- | :------------ | :---------------- | | Warranty reserve | $2,120 | $1,950 | | Litigation reserve | $468 | $328 | | Federal and state income taxes | $641 | $3,295 | | Total Accrued Liabilities | $11,974 | $13,672 | - Total accrued liabilities decreased by $1.70 million (12.42%) from December 31, 2024, to June 30, 2025, mainly due to a significant reduction in federal and state income taxes[108] 11. Lines of Credit This note describes the company's revolving credit facility, including its commitment, maturity, outstanding balance, available credit, and compliance with financial covenants - The Company has a four-year senior secured revolving credit facility (the 'Revolver') with an initial commitment of $50.0 million, maturing July 28, 2027[109][167] | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------- | :------------ | :---------------- | | Outstanding balance | $142 | $0 | | Available credit | $49,858 | $50,000 | | Interest rate | 6.76% | 7.61% | - The Company was in compliance with all financial covenants as of June 30, 2025, including a maximum leverage ratio of 1.00 to 1.00 and a minimum fixed charge coverage ratio of 1.75 to 1.00[111][168] 12. Income Taxes This note provides details on the company's income tax expense and effective tax rates, explaining factors contributing to deviations from the federal statutory rate | Metric (in thousands) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :-------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Income tax expense | $(3,081) | $(3,607) | $(5,533) | $(6,980) | | Effective tax rate | 17.3% | 18.2% | 18.1% | 18.2% | - The effective tax rate for the three and six months ended June 30, 2025, was lower than the federal statutory rate of 21% due to federal tax credits for energy-efficient homes and a purchased federal tax credit[112] 13. Commitments and Contingencies This note outlines the company's various commitments and contingent liabilities, including self-insured health benefits, repurchase agreements, and legal proceedings - The Company has a self-insured health benefits plan with a stop-loss policy, accruing $878 thousand for incurred but not reported medical claims as of June 30, 2025[113] - Contingent liabilities under repurchase agreements for independent retailers' inventory financing approximated $512 thousand at June 30, 2025, a decrease from $805 thousand at December 31, 2024[114][170] - Legal reserves for ordinary course legal proceedings totaled $468 thousand as of June 30, 2025, with management believing current litigation will not have a material adverse effect[118] 14. Fair Value Measurements This note provides a comparison of the fair value and book value for various loan portfolios, illustrating potential discounts or premiums | Portfolio (in thousands) | June 30, 2025 Fair Value | June 30, 2025 Book Value | December 31, 2024 Fair Value | December 31, 2024 Book Value | | :----------------------- | :----------------------- | :----------------------- | :--------------------------- | :--------------------------- | | Consumer loan portfolio | $174,427 | $186,360 | $164,755 | $174,105 | | Fixed rate MHP Notes | $192,819 | $197,154 | $199,651 | $203,388 | | Fixed rate other notes | $12,386 | $12,517 | $14,730 | $14,916 | - The fair value of the consumer loan portfolio was lower than its book value at both periods, indicating a discount[119] 15. Earnings Per Share This note presents the basic and diluted earnings per share calculations, along with information on share repurchases affecting the weighted-average shares outstanding | 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 | | :----- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic EPS | $0.61 | $0.67 | $1.04 | $1.29 | | Diluted EPS | $0.60 | $0.65 | $1.01 | $1.26 | - Both basic and diluted EPS decreased for the three and six months ended June 30, 2025, compared to the prior year, despite an increase in total net revenue for the three-month period[123] - The Company repurchased 260,635 shares of common stock for $5.82 million during the three months ended June 30, 2025, with approximately $8.11 million remaining authorization[123] 16. Related Party Transactions This note discloses significant transactions with related parties, specifically home sales to affiliated entities, and their impact on revenue | Related Party | Home Sales (3 months ended June 30, 2025) | Home Sales (3 months ended June 30, 2024) | Home Sales (6 months ended June 30, 2025) | Home Sales (6 months ended June 30, 2024) | | :------------ | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | :---------------------------------------- | | Bell Mobile Homes | $1,162 | $1,312 | $1,547 | $2,431 | | Shipley Bros., Ltd. and Crazy Red's Mobile Homes | $805 | $1,361 | $1,197 | $1,660 | - Home sales to related party Bell Mobile Homes decreased by 11.5% for the three months and 36.4% for the six months ended June 30, 2025, compared to the prior year[126] - Home sales to related party Shipley decreased by 40.9% for the three months and 27.9% for the six months ended June 30, 2025, compared to the prior year[127] 17. Subsequent Events This note confirms that no significant events occurred after the reporting period that would require adjustment or disclosure in the financial statements - No events requiring adjustments or disclosures in the interim financial statements occurred after June 30, 2025, through the filing date[128] Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on Legacy Housing Corporation's financial condition and results of operations, highlighting key business activities, factors affecting performance, and a detailed comparison of financial results for the three and six months ended June 30, 2025, versus 2024 Overview This section introduces Legacy Housing Corporation as a vertically integrated manufacturer, seller, and financier of manufactured homes, outlining its primary market and recent sales performance - Legacy Housing Corporation is a vertically integrated manufacturer, seller, and financier of manufactured homes and 'tiny houses,' primarily operating in the southern United States[131][133] - The Company sold 697 home sections for the three months ended June 30, 2025, an increase from 578 in the same period of 2024, but total units sold for the six months ended June 30, 2025, decreased to 1,124 from 1,223 in 2024[131] - Approximately 58% of manufactured homes were sold in Texas for the six months ended June 30, 2025[135] Factors Affecting Our Performance This section discusses key internal and external factors influencing the company's financial performance, including development activities, economic conditions, and production capacity - The Company is developing manufactured housing communities and subdivisions, with significant land and improvements in Bastrop County, Texas, totaling $24.12 million[137] - Inflation and rising interest rates pose risks to gross margins and home buyer financing affordability, which the Company is actively working to mitigate[137] - Future growth depends on the ability to fulfill orders and potentially expand production capacity, with the Georgia manufacturing facility having space for additional investment[137] Results of Operations This section analyzes the company's financial results, comparing performance across different periods and explaining the drivers behind revenue, expenses, and net income Comparison of Three Months ended June 30, 2025 and 2024 This subsection compares the company's financial performance for the three months ended June 30, 2025, against the same period in 2024, highlighting key revenue and income changes | Metric (in thousands) | June 30, 2025 | June 30, 2024 | $ Change | % Change | | :-------------------- | :------------ | :------------ | :------- | :------- | | Product sales | $38,387 | $31,652 | $6,735 | 21.3% | | Consumer, MHP and dealer loans interest | $10,883 | $9,844 | $1,039 | 10.6% | | Total net revenue | $50,161 | $42,495 | $7,666 | 18.0% | | Income from operations| $16,817 | $16,030 | $787 | 4.9% | | Net income | $14,695 | $16,189 | $(1,494) | (9.2)% | - Product sales increased by 21.3% due to higher unit volumes, particularly in inventory finance sales (up 53.3%) and retail sales (up 64.2%)[139][140] - Net income decreased by 9.2% despite revenue growth, primarily due to a $2.8 million decrease in other income, driven by lower non-operating interest income and miscellaneous income[139][146] Comparison of Six Months ended June 30, 2025 and 2024 This subsection compares the company's financial performance for the six months ended June 30, 2025, against the same period in 2024, detailing changes in revenue, income, and sales volumes | Metric (in thousands) | June 30, 2025 | June 30, 2024 | $ Change | % Change | | :-------------------- | :------------ | :------------ | :------- | :------- | | Product sales | $62,677 | $62,484 | $193 | 0.3% | | Consumer, MHP and dealer loans interest | $21,538 | $20,477 | $1,061 | 5.2% | | Total net revenue | $85,831 | $85,738 | $93 | 0.1% | | Income from operations| $28,408 | $32,780 | $(4,372) | (13.3)% | | Net income | $24,971 | $31,329 | $(6,358) | (20.3)% | - Product sales remained flat (0.3% increase) for the six-month period, with a 13.9% decrease in total units sold but a 16.4% increase in net revenue per unit sold due to a shift towards higher-priced consumer sales[151][152] - Net income decreased by 20.3% for the six months, primarily due to a $3.4 million decrease in other income, reflecting lower non-operating interest income and miscellaneous income[149][157] Liquidity and Capital Resources This section assesses the company's ability to meet its short-term and long-term financial obligations, discussing cash flow, available credit, and funding strategies - The Company believes cash flow from operations, current cash balances, and available lines of credit are sufficient to fund operations and growth for the next 12 to 18 months[160] | Cash Flow Activity (in thousands) | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $10,970 | $14,265 | | Net cash (used in) provided by investing activities | $(3,138) | $2,142 | | Net cash used in financing activities | $(6,350) | $(17,095) | | Net change in cash | $1,482 | $(688) | | Cash at end of period | $2,631 | $60 | - Net cash used in financing activities decreased significantly from $17.1 million in 2024 to $6.35 million in 2025, mainly due to lower net payments on lines of credit[165] Item 3. Quantitative and Qualitative Disclosures About Market Risk This section states that there are no applicable quantitative and qualitative disclosures about market risk for the Company - The Company has no applicable quantitative and qualitative disclosures about market risk[173] Item 4. Controls and Procedures This section details the Company's disclosure controls and procedures, acknowledging material weaknesses in internal control over financial reporting as of June 30, 2025 - Management concluded that disclosure controls and procedures were not effective as of June 30, 2025, due to material weaknesses in internal control over financial reporting[175] - Material weaknesses include insufficient design, implementation, monitoring, or testing of control activities; inadequate documentation and review; insufficient qualified accounting personnel; and lack of sufficiently designed, implemented, or maintained IT general controls[177][180] - Despite the identified weaknesses, management believes the financial statements in this report fairly present the Company's financial condition, results of operations, and cash flows[176] PART II - OTHER INFORMATION Item 1. Legal Proceedings This section refers to Note 13 of the financial statements for details on legal proceedings, which are considered to arise in the ordinary course of business and are not expected to have a material adverse effect on the Company's financial position - Legal proceedings are discussed in Note 13 - Commitments and Contingencies[182] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section provides details on the Company's share repurchase program, including the number of shares repurchased and the remaining authorization for the three months ended June 30, 2025 | Period | Total number of shares purchased | Average price paid per share | Approximate dollar value of shares that may yet be purchased (in thousands) | | :-------------- | :------------------------------- | :--------------------------- | :------------------------------------------------------------------------ | | April 1-30, 2025 | 11,466 | $22.71 | $13,667 | | May 1-31, 2025 | 83,446 | $22.39 | $11,794 | | June 1-30, 2025 | 165,723 | $22.19 | $8,110 | - The Company repurchased 260,635 shares of common stock for $5.82 million during the three months ended June 30, 2025, under a publicly announced program[183] - As of June 30, 2025, approximately $8.11 million remained authorized for repurchase under the program, which is in effect until October 31, 2025[183] Item 3. Defaults Upon Senior Securities This section states that there were no defaults upon senior securities during the reporting period - There were no defaults upon senior securities[184] Item 4. Mine Safety Disclosures This section indicates that there are no mine safety disclosures applicable to the Company - There are no mine safety disclosures[184] Item 5. Other Information This section confirms that no officers or directors adopted, modified, or terminated Rule 10b5-1 trading plans during the three months ended June 30, 2025 - No officers or directors adopted, modified, or terminated Rule 10b5-1 trading plans during the three months ended June 30, 2025[184] Item 6. Exhibits This section lists all exhibits filed with the Form 10-Q, including certifications, XBRL documents, and other required filings - The exhibits include Rule 13a-14(a) / 15d-14(a) Certifications from the CEO and CFO, Section 1350 Certifications, and various XBRL documents[187] SIGNATURES Signatures This section contains the required signatures for the Form 10-Q, confirming its submission by authorized officers of Legacy Housing Corporation - The report was signed by R. Duncan Bates, President and Chief Executive Officer, and Jeffrey Fiedelman, Chief Financial Officer, on August 7, 2025[191]