NVR, Inc. Announces Third Quarter Results

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RESTON, Va., Oct. 20, 2014 /PRNewswire/ -- NVR, Inc. NVR, one of the nation's largest homebuilding and mortgage banking companies, announced net income for its third quarter ended September 30, 2014 of $90,152,000, or $20.70 per diluted share.  Net income and diluted earnings per share for its third quarter ended September 30, 2014 increased 9% and 17%, respectively, when compared to the 2013 third quarter.  Consolidated revenues for the third quarter of 2014 totaled $1,203,166,000, a 1% increase from $1,188,967,000 for the comparable 2013 quarter.

For the nine months ended September 30, 2014, consolidated revenues were $3,116,530,000, 5% higher than the $2,969,115,000 reported for the same period of 2013.  Net income for the nine months ended September 30, 2014 was $182,179,000, an increase of 8% when compared to the nine months ended September 30, 2013.  Diluted earnings per share for the nine months ended September 30, 2014 was $40.59, an increase of 19% from $34.13 per diluted share for the comparable period of 2013. 

Homebuilding

New orders in the third quarter of 2014 increased 23% to 2,936 units when compared to 2,381 units in the third quarter of 2013.  The cancellation rate in the third quarter of 2014 was 16% compared to 19% in the third quarter of 2013 and 13% in the second quarter of 2014.  Settlements in the third quarter of 2014 decreased 3% to 3,236 units when compared to the same period in 2013.  The Company's backlog of homes sold but not settled as of September 30, 2014 increased on a unit basis by 10% to 6,231 units, and increased on a dollar basis by 14% to $2,360,730,000 when compared to September 30, 2013.

Homebuilding revenues for the three months ended September 30, 2014 totaled $1,185,160,000, 2% higher than the year earlier period.  Gross profit margin in the third quarter of 2014 was 19.0% compared to 17.4% in the third quarter of 2013.  Income before tax from the homebuilding segment totaled $136,511,000 in the 2014 third quarter, an increase of 14% when compared to the third quarter of 2013.

Mortgage Banking

Mortgage closed loan production of $803,125,000 for the three months ended September 30, 2014 was 15% higher than the same period last year.  Operating income for the mortgage banking operations during the third quarter of 2014 decreased 38% to $7,280,000, when compared to $11,803,000 reported for the same period of 2013.   

About NVR

NVR, Inc. operates in two business segments:  homebuilding and mortgage banking.  The homebuilding unit sells and builds homes under the Ryan Homes, NVHomes, Fox Ridge Homes and Heartland Homes trade names, and operates in twenty-seven metropolitan areas in fourteen states and Washington, D.C.  For more information about NVR, Inc. and its brands, see www.nvrinc.com, www.ryanhomes.com, www.nvhomes.com, www.foxridgehomes.com and www.heartlandluxuryhomes.com.

Some of the statements in this release made by the Company constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Certain, but not necessarily all, of such forward-looking statements can be identified by the use of forward-looking terminology, such as "believes," "expects," "may," "will," "should" or "anticipates" or the negative thereof or other comparable terminology.  All statements other than of historical facts are forward-looking statements.  Forward-looking statements contained in this document may include those regarding market trends, NVR's financial position, business strategy, the outcome of pending litigation, investigations or similar contingencies, projected plans and objectives of management for future operations.  Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance of NVR to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements.  Such risk factors include, but are not limited to the following: general economic and business conditions (on both a national and regional level); interest rate changes; access to suitable financing by NVR and NVR's customers; increased regulation in the mortgage banking industry; the ability of our mortgage banking subsidiary to sell loans it originates into the secondary market; competition; the availability and cost of land and other raw materials used by NVR in its homebuilding operations; shortages of labor; weather related slow-downs; building moratoriums; governmental regulation; fluctuation and volatility of stock and other financial markets; mortgage financing availability; and other factors over which NVR has little or no control.  NVR undertakes no obligation to update such forward-looking statements except as required by law.

 

 


NVR, Inc.

Consolidated Statements of Income

(in thousands, except per share data)

(Unaudited)





Three Months Ended September 30,


Nine Months Ended September 30,




2014


2013


2014


2013

Homebuilding:









Revenues                                         

$        1,185,160


$        1,167,595


$        3,068,427


$        2,910,673


Other income

905


1,030


2,354


3,154


Cost of sales

(960,055)


(964,416)


(2,497,985)


(2,422,789)


Selling, general and administrative 

(83,881)


(78,897)


(268,096)


(239,430)



Operating income 

142,129


125,312


304,700


251,608


Interest expense

(5,618)


(5,525)


(16,895)


(16,214)



Homebuilding income 

136,511


119,787


287,805


235,394











Mortgage Banking:









Mortgage banking fees

18,006


21,372


48,103


58,442


Interest income

1,373


1,396


3,382


3,398


Other income

240


218


493


509


General and administrative

(12,182)


(11,026)


(37,064)


(30,459)


Interest expense

(157)


(157)


(397)


(408)



Mortgage banking income

7,280


11,803


14,517


31,482











Income before taxes 

143,791


131,590


302,322


266,876













Income tax expense

(53,639)


(48,655)


(120,143)


(98,210)











Net income

$             90,152


$             82,935


$           182,179


$           168,666











Basic earnings per share 

$               21.49


$               18.08


$               42.01


$               35.01











Diluted earnings per share 

$               20.70


$               17.67


$               40.59


$               34.13











Basic weighted average shares outstanding 

4,196


4,588


4,336


4,817











Diluted weighted average shares outstanding 

4,354


4,695


4,489


4,942











 

 

NVR, Inc.

Consolidated Balance Sheets

(in thousands, except share and per share data)





September 30, 2014


December 31, 2013

ASSETS


(Unaudited)










Homebuilding:






Cash and cash equivalents


$                      455,387


$                      844,274


Receivables


11,465


9,529


Inventory:






        Lots and housing units, covered under






              sales agreements with customers


837,626


568,831


        Unsold lots and housing units


108,879


117,467


        Land under development


55,668


41,328


        Building materials and other


11,560


10,939





1,013,733


738,565









Assets related to consolidated variable interest entity


6,232


7,268


Contract land deposits, net


283,579


236,885


Property, plant and equipment, net


46,365


32,599


Reorganization value in excess of amounts






        allocable to identifiable assets, net


41,580


41,580


Goodwill and finite-lived intangible assets, net


5,710


6,747


Other assets


316,189


307,933





2,180,240


2,225,380








Mortgage Banking:






Cash and cash equivalents


8,308


21,311


Mortgage loans held for sale, net


198,597


210,641


Property and equipment, net


6,459


4,699


Reorganization value in excess of amounts






        allocable to identifiable assets, net


7,347


7,347


Other assets


12,125


16,770





232,836


260,768










Total assets


$                   2,413,076


$                   2,486,148















LIABILITIES AND SHAREHOLDERS' EQUITY












Homebuilding:






Accounts payable


$                      227,936


$                      181,687


Accrued expenses and other liabilities


289,696


316,227


Liabilities related to consolidated variable interest entity


2,320


1,646


Non-recourse debt related to consolidated variable







interest entity


661


3,365


Customer deposits


119,423


101,022


Senior notes


599,143


599,075





1,239,179


1,203,022








Mortgage Banking:






Accounts payable and other liabilities


22,503


21,774





22,503


21,774










Total liabilities


1,261,682


1,224,796








Commitments and contingencies












Shareholders' equity:






Common stock, $0.01 par value; 60,000,000 shares







authorized; 20,555,330 shares issued as of







both September 30, 2014 and December 31, 2013


206


206


Additional paid-in-capital


1,299,533


1,212,050


Deferred compensation trust – 108,614 and







109,256 shares of NVR, Inc. common stock as of







September 30, 2014 and December 31, 2013, respectively


(17,333)


(17,741)


Deferred compensation liability


17,333


17,741


Retained earnings


4,787,736


4,605,557


Less treasury stock at cost – 16,388,669 and







16,121,605 shares at September 30, 2014







and December 31, 2013, respectively


(4,936,081)


(4,556,461)



Total shareholders' equity


1,151,394


1,261,352



    Total liabilities and shareholders' equity


$                   2,413,076


$                   2,486,148





























NVR, Inc.

Operating Activity

(dollars in thousands)

(Unaudited)












Three Months Ended September 30,


Nine Months Ended September 30,





2014


2013


2014


2013













Homebuilding data:










New orders (units)











Mid Atlantic (1)


1,504


1,224


4,930


4,611



North East (2)


310


265


896


832



Mid East (3)


653


543


2,369


2,325



South East (4)


469


349


1,481


1,401



   Total


2,936


2,381


9,676


9,169













Average new order price


$               375.5


$               367.9


$               370.3


$               355.9













Settlements (units)











Mid Atlantic (1)


1,650


1,700


4,321


4,331



North East (2)


276


264


780


714



Mid East (3)


827


890


2,012


2,205



South East (4)


483


488


1,277


1,242



   Total


3,236


3,342


8,390


8,492













Average settlement price


$               366.2


$               349.2


$               365.6


$               342.7













Backlog (units)











Mid Atlantic (1)






3,319


2,963



North East (2)






611


551



Mid East (3)






1,389


1,272



South East (4)






912


870



   Total






6,231


5,656













Average backlog price






$               378.9


$               367.3













Community count (average)


493


453


489


447


Lots controlled at end of period






68,500


61,500












Mortgage banking data:










Loan closings


$           803,125


$           695,930


$        1,951,682


$        1,816,146


Capture rate


86%


79%


83%


82%












Common stock information:










Shares outstanding at end of period






4,166,661


4,546,902


Number of shares repurchased


53,988


154,696


371,727


454,782


Aggregate cost of shares repurchased

$             61,989


$           140,830


$           409,436


$           435,809











(1)   Maryland, Virginia, West Virginia, Delaware and Washington, D.C.


(2)   New Jersey and eastern Pennsylvania


(3)   New York, Ohio, western Pennsylvania, Indiana and Illinois


(4)   North Carolina, South Carolina, Tennessee and Florida

 

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/nvr-inc-announces-third-quarter-results-507461351.html

SOURCE NVR, Inc.

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