Legacy Housing(US:LEGH)2025-11-07 22:00Revenue Performance - For the three months ended September 30, 2025, total net revenue decreased by $3.8 million, or 8.6%, to $40.5 million compared to $44.3 million in the same period of 2024[150]. - Total net revenue for the nine months ended September 30, 2025, was $126.3 million, a decrease of $3.7 million or 2.8% compared to $130.0 million in 2024[159]. Product Sales - Product sales decreased by $1.4 million, or 4.6%, primarily due to a decrease in unit volumes shipped, with total units sold dropping from 475 to 420, a decline of 11.6%[150][151]. - Product sales decreased by $1.2 million, or 1.3%, during the nine months ended September 30, 2025, primarily due to a $7.5 million decrease in mobile home park sales[161]. Revenue per Unit - The net revenue per unit sold increased by 7.9% to $68.5, attributed to higher retail prices for consumer sales[151]. - Net revenue per unit sold increased by 13.7% to $68.6 during the nine months ended September 30, 2025, compared to $60.3 in 2024[162]. Other Revenue - Other revenue decreased significantly by $3.0 million, or 78.8%, primarily due to a $2.7 million drop in land sales[154]. - Other revenue decreased by $4.1 million, or 63.1%, during the nine months ended September 30, 2025, primarily due to a decrease in land sale revenue[164]. Operating Expenses - The cost of product sales increased by $1.6 million, or 7.5%, with raw material and tariff costs rising from 39.4% to 47.7% of sales[155]. - Selling, general, and administrative expenses increased by $1.3 million, or 20.6%, due to higher legal and consulting expenses[156]. - Operating expenses increased by $6.3 million, or 7.7%, during the nine months ended September 30, 2025, totaling $88.2 million[159]. Net Income - Net income for the nine months ended September 30, 2025, was $33.6 million, a decrease of $13.5 million or 28.7% compared to $47.1 million in 2024[159]. Cash Flow - Cash at the end of the period increased to approximately $13.6 million as of September 30, 2025, compared to $1.1 million as of December 31, 2024[171]. - Net cash provided by operating activities was $18.1 million during the nine months ended September 30, 2025, down from $28.1 million in 2024[173]. Tax Rate - The effective tax rate for the nine months ended September 30, 2025, was 17.5%, down from 18.2% in 2024, primarily due to federal tax credits[168]. Financing and Debt - The Company entered into a new four-year senior secured revolving credit facility with an initial commitment of $50,000 and an additional $25,000 under an accordion feature[177]. - Interest expense under the Revolver for the three months ended September 30, 2025 was $2, a significant decrease from $175 in the same period of 2024[178]. - The outstanding balance of the Revolver as of September 30, 2025 was $0, indicating no current borrowings[178]. - The interest rate for the Revolver as of September 30, 2025 was 7.25%, down from 7.61% as of December 31, 2024[178]. Compliance and Obligations - The Company was in compliance with all financial covenants as of September 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[178]. - The Company has contractual obligations for operating lease obligations totaling $1,041, with $120 due in 2025 and $776 due in 2026-2027[179]. - The maximum contingent obligations under repurchase agreements were approximately $713 as of September 30, 2025, down from $805 as of December 31, 2024[180]. Accounting Estimates - Critical accounting estimates are based on historical experiences and various factors, with actual results potentially differing from these estimates[181]. - Recent accounting pronouncements are detailed in the Company's September 30, 2025 Condensed Financial Statements[182].