Meritage Homes(US:MTH) Globenewswireยท2025-04-23 20:30Core Insights - Meritage Homes reported a healthy start to 2025, closing 3,416 homes in Q1, despite a 3% decrease from the previous year [3][4] - The company achieved a home closing revenue of $1.34 billion, reflecting an 8% year-over-year decline, attributed to lower home closing volume and average sales price [4][11] - The ending backlog of homes decreased significantly by 34% to 2,004 units, with a backlog value of $812 million, down 35% from the previous year [4][11] Financial Performance - Net earnings for Q1 2025 were $122.8 million, a 34% decrease from $186 million in Q1 2024, primarily due to lower home closing revenue and gross margins [4][11] - Diluted earnings per share (EPS) fell to $1.69, down 33% from $2.53 in the same quarter last year [4][11] - The home closing gross margin was reported at 22.0%, a decrease of 380 basis points from 25.8% in the prior year [7][11] Operational Highlights - The average sales price for homes closed was $393,000, down 6% from $418,000 in Q1 2024, influenced by increased financing incentives [4][11] - Home orders totaled 3,876 units, a 3% decrease year-over-year, with an average sales price of $402,000, down 2% from the previous year [4][11] - The company maintained a strong balance sheet with cash and cash equivalents totaling $1 billion as of March 31, 2025, compared to $652 million at the end of 2024 [3][4] Strategic Initiatives - Meritage Homes issued $500 million in new debt to balance growth investments and shareholder returns, with land acquisition and development spending reaching $465 million in Q1 2025 [3][4] - The company reported a backlog conversion rate of 221%, indicating strong demand and effective sales strategies [3][4] - Management emphasized a focus on affordability and move-in ready inventory to capture additional market share amid favorable demographics and limited supply [3][4]