Beazer Homes USA(US:BZH)2024-05-01 20:51Debt and Financial Obligations - As of March 31, 2024, the company had variable rate debt outstanding totaling approximately $75.4 million, with a potential interest expense increase of approximately $1.0 million for a one percent rise in interest rates[32]. - The estimated fair value of the company's fixed-rate debt was $959.0 million, compared to a carrying amount of $947.9 million, with a hypothetical one-percentage point decrease in discount rates increasing the fair value to $1.00 billion[32]. - The company reported a total debt of $1.02 billion as of March 31, 2024, an increase from $978.03 million as of September 30, 2023[75]. - The total debt, net of unamortized debt issuance costs, was $1,023,311,000 as of March 31, 2024, compared to $978,028,000 as of September 30, 2023, indicating an increase of about 4.6%[133]. - The company had letters of credit outstanding of $34.8 million as of March 31, 2024, up from $31.2 million as of September 30, 2023[135]. - The company repurchased $4.3 million of its outstanding 2025 Notes, resulting in a loss on extinguishment of debt of less than $0.1 million[138]. - In March 2024, the company redeemed the remaining $197.9 million of its outstanding 2025 Notes, incurring a loss on extinguishment of debt of $0.4 million[138]. - The company has terminated all obligations under the 2025 Notes as of March 31, 2024[138]. - The company issued $250.0 million aggregate principal amount of the 2031 Notes at par, with interest payable semiannually starting September 2024[165]. - The company's unsecured junior subordinated notes have an aggregate principal balance of $100.8 million as of March 31, 2024, with a weighted-average interest rate of 8.03%[168]. Revenue and Income - The company reported a net income of $60.9 million for the six months ended March 31, 2024[59]. - Total revenue for the three months ended March 31, 2024, was $541.54 million, a decrease of 0.25% from $543.91 million in the same period of 2023[77]. - Gross profit for the three months ended March 31, 2024, was $101.85 million, compared to $102.90 million in the prior year, reflecting a slight decline of 1.03%[77]. - Net income for the three months ended March 31, 2024, was $39.17 million, an increase of 12.14% from $34.71 million in the same period of 2023[77]. - Homebuilding revenue for the six months ended March 31, 2024, was $538,636,000, a slight decrease from $542,007,000 for the same period in 2023, representing a decline of approximately 0.7%[116]. - Total revenue for the six months ended March 31, 2024, was $541,540,000, compared to $543,908,000 for the same period in 2023, indicating a decrease of about 0.4%[116]. - Total revenue for the six months ended March 31, 2024, was $928,358 thousand, down from $988,836 thousand in the same period of 2023, reflecting a decrease of 6.1%[212]. Assets and Inventory - Total assets as of March 31, 2024, amounted to $2.52 billion, up from $2.41 billion as of September 30, 2023, indicating a growth of 4.3%[75]. - Owned inventory as of March 31, 2024, was $2.06 billion, up from $1.76 billion as of September 30, 2023, indicating a growth of 17.1%[75]. - Total owned inventory as of March 31, 2024, was $2,057,461,000, an increase from $1,756,203,000 as of September 30, 2023, representing a rise of about 17.1%[126]. - The company had 2,829 homes under construction as of March 31, 2024, an increase from 2,163 homes under construction as of September 30, 2023, reflecting a growth of 30.8%[95]. - Homes under construction increased to 851,278 as of March 31, 2024, compared to 644,363 as of September 30, 2023, reflecting a growth of approximately 32%[122]. Shareholder Returns and Repurchases - The company has a share repurchase program with $41.8 million remaining for repurchases as of March 31, 2024, with no repurchases made during the three and six months ended March 31, 2024[44]. - The company has $41.8 million remaining under its share repurchase program approved in May 2022, with no repurchases made during the three and six months ended March 31, 2024, and 2023[65]. - There were no dividends paid during the three and six months ended March 31, 2024, consistent with the previous year[45]. Operating Performance - Total operating income for the six months ended March 31, 2024, is $56,256,000, down from $67,294,000 in the same period of 2023[190]. - Operating income for the West segment in 2024 is $46,030,000, slightly up from $45,513,000 in 2023[190]. - SG&A expenses for the quarter were 11.5% of total revenue, up from 11.2% in the prior year quarter, primarily due to higher sales and marketing costs[221]. Tax and Compliance - Income tax expense from continuing operations for the three months ended March 31, 2024, is $6.7 million, an increase from $5.1 million in the same period of 2023[182]. - The effective tax rate for the three months ended March 31, 2024, increased to 14.7% from 12.8% in the prior year[223]. - The company is currently evaluating the impact of the new ASU 2023-09 on its consolidated financial statements and disclosures, which will enhance transparency in income tax disclosures[92]. - The company is currently evaluating the impact of the adoption of ASU 2023-07 on its consolidated financial statements and disclosures, which will be effective for the fiscal year ending September 30, 2025[118]. Risk Management and Litigation - The company has an accrual of $8.8 million related to litigation matters as of March 31, 2024[150]. - The company maintains warranty and litigation accruals and third-party insurance to cover potential liabilities associated with known and anticipated claims[148]. - Warranty provision for the three months ended March 31, 2024, is $2,208,000, compared to $2,335,000 for the same period in 2023[176]. - The balance of warranty reserves at the end of the period is $12,129,000, down from $13,073,000 in the previous year[176]. Market and Community Development - The company controlled 26,887 lots as of March 31, 2024, with 51.6% of active lots (13,527) managed through option agreements, a decrease from 54.0% in the previous year[46]. - The company controlled 26,887 lots as of March 31, 2024, representing a 12.9% increase from 23,820 lots a year ago[195]. - Average active community count increased by 13.8% to 140 during the quarter ended March 31, 2024, with 145 active communities at the end of the quarter, up 19.8% from 121 a year ago[218]. - The company invested $197.8 million in land acquisition and development during the quarter ended March 31, 2024, a 75.0% increase from $113.0 million in the same quarter of 2023[218]. - The company continues to refine its product offerings to address home affordability concerns by adjusting home sizes and specifications[194]. Compensation and Employee Expenses - The company’s stock-based compensation expense for the same period was $3.1 million[59]. - Stock-based compensation expense for the three months ended March 31, 2023, was $3,062, slightly down from $3,258 in the same period last year, showing a decrease of 6.0%[82]. - The company recognized stock-based compensation expense of $1,389,000 for the three months ended March 31, 2024, compared to $1,678,000 for the same period in 2023[184]. - Total unrecognized compensation costs related to unvested restricted stock awards were $10.5 million as of March 31, 2024[185]. Cash Flow and Capital Expenditures - Total cash, cash equivalents, and restricted cash at the end of the period was $165,394, down from $279,150 at the end of the previous year, indicating a decrease of 40.7%[82]. - Net cash used in operating activities for the three months ended March 31, 2023, was $(239,573), compared to $40,268 in the same period last year, indicating a significant decline[82]. - The company reported capital expenditures of $(11,501) for the three months ended March 31, 2023, compared to $(7,824) in the same period last year, representing an increase of 47.3%[82]. - Total capital expenditures for the six months ended March 31, 2024, were $11,501 thousand, a 47.3% increase from $7,824 thousand in the same period of 2023[192].