Forestar (US:FOR)2025-11-19 17:20Financial Performance - Revenues for fiscal year 2025 increased by 10% to $1,662.4 million compared to $1,509.4 million in fiscal year 2024[150]. - The average sales price per residential lot rose to $108,400 in fiscal 2025 from $96,600 in fiscal 2024, despite a decrease in total lots sold[151]. - The company sold 14,240 residential lots in fiscal 2025, down from 15,068 in fiscal 2024, with sales to D.R. Horton decreasing from 13,267 to 11,751 lots[153]. - Selling, general and administrative (SG&A) expenses increased to $154.4 million in fiscal 2025, representing 9.3% of revenues, up from 7.9% in fiscal 2024[159]. - In fiscal 2025, net cash used in operating activities was $197.7 million, compared to $158.4 million in fiscal 2024[180]. - Net cash provided by financing activities in fiscal 2025 was $92.5 million, significantly higher than $16.3 million in fiscal 2024, primarily due to the issuance of $500 million principal amount of 2033 notes[182]. Debt and Liquidity - The company maintained a strong liquidity position with $379.2 million in cash and cash equivalents and $588.9 million in available borrowing capacity as of September 30, 2025[166]. - The ratio of debt to total capital increased to 31.2% in fiscal 2025 from 30.7% in fiscal 2024, while the ratio of net debt to total capital rose to 19.3% from 12.4%[167]. - Interest incurred increased to $45.5 million in fiscal 2025 from $32.6 million in fiscal 2024, with capitalized interest representing 2.4% of total cost of sales[158]. - As of September 30, 2025, the company had a $640 million senior unsecured revolving credit facility, which was increased to $665 million after exercising the accordion feature[169]. - The company had no outstanding borrowings under the revolving credit facility as of September 30, 2025, with $51.1 million in letters of credit issued, resulting in an available capacity of $588.9 million[169]. - The company recognized a $1.2 million loss on extinguishment of debt related to the repurchase and redemption of its 2026 notes in fiscal 2025[172]. - The company had $300 million principal amount of 5.0% senior notes maturing March 1, 2028, with an annual effective interest rate of 5.2%[174]. - The company issued a note payable of $9.9 million in December 2023 for real estate acquisition, maturing in December 2025[178]. Strategic Focus - The company plans to remain disciplined in land investments and focus on managing lot sales pace and pricing to optimize returns[148]. - The company is positioned to consolidate market share in the lot development industry due to its national footprint and strategic relationship with D.R. Horton[148]. - The strategic relationship with D.R. Horton may impact customer relationships and potential benefits[199]. Compliance and Accounting Standards - The company was in compliance with all financial covenants associated with its revolving credit facility as of September 30, 2025[170]. - The company has an effective shelf registration statement for $750 million of equity securities, with $300 million reserved for sales under its at-the-market equity offering program[179]. - The FASB issued ASU 2023-09, effective for fiscal 2026, requiring disaggregated income tax disclosures[195]. - ASU 2024-03, effective for fiscal 2028 and interim periods in fiscal 2029, mandates expense disaggregation disclosures[196]. - The company is evaluating the impact of new accounting standards on its consolidated financial statements[195][196]. Risk Factors - Interest rate risk is monitored, with fixed rate debt totaling $300 million at 5.0%, $500 million at 6.5%, and $9.9 million at 4.0%[202]. - There is no exposure to foreign currency fluctuations or significant commodity price fluctuations[203][204]. - The company faces various risks including economic conditions, inflation, and supply shortages[199]. - The company is subject to risks from public health issues, natural disasters, and cybersecurity incidents[199]. - Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ significantly[197][198].