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M.D.C. Holdings Announces 2015 Full Year And Fourth Quarter Results

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DENVER, Feb. 3, 2016 /PRNewswire/ -- M.D.C. Holdings, Inc. (NYSE: MDC) announced results for the year and fourth quarter ended December 31, 2015.

2015 Fourth Quarter Highlights and Comparisons to 2014 Fourth Quarter

  • Net income of $22.6 million, or $0.46 per share vs. $14.6 million or $0.30 per share
    • Pretax income of $32.6 million vs. $23.9 million
  • Home sale revenues of $554.4 million, up 12% from $493.1 million
  • Gross margin from home sales down 20 basis points to 16.1% vs. 16.3%
    • Excluding inventory impairments*, gross margin from home sales increased 60 basis points year-over-year
  • Ending backlog dollar value of $1.05 billion, up 59%
    • Ending backlog units of 2,332, up 54%
  • Dollar value of net new orders of $450.5 million, up 26%
    • Net new orders of 1,020, up 15%

Larry A. Mizel, MDC's Chairman and Chief Executive Officer, stated, "Throughout the year, the homebuilding industry continued to be positively impacted by encouraging macroeconomic drivers such as increasing personal income levels, high employment levels and increasing consumer confidence. As a result of these factors, strong execution by our management team, and a renewed focus on "build to order homes", we experienced positive results by many measures for the 2015 fourth quarter, including a year-over-year increase in our average selling price of homes delivered and a 60 basis point improvement in our pre-impairment gross margin percentage, which helped us to achieve $22.6 million of net income for the quarter. Furthermore, our 2015 fourth quarter net orders improved by 15% year-over-year, driven by our highest fourth quarter absorption pace in ten years."

Mr. Mizel concluded, "With our active community count up 5% year-over-year and a backlog dollar value of $1.05 billion, which is a 59% increase from the prior year, we are well positioned for top-line growth in 2016. However, our optimism is tempered somewhat by key domestic and global events that have recently unfolded, such as the slowdown of economic growth in China, the significant drop in oil prices, the Federal Reserve's action to increase the federal funds rate for the first time in almost a decade and significant volatility in securities markets around the globe. Thus far, these risks have not had a significant impact on our industry, but their presence does reinforce our long-standing objective of maintaining balance sheet-focused operating policies."

Homebuilding

Home sale revenues for the 2015 fourth quarter increased 12% to $554.4 million, compared to $493.1 million for the prior year period. This improvement was driven by a 3% increase in deliveries coupled with a 10% increase in average selling price, primarily due to a mix shift to higher-priced submarkets and, to a lesser extent, price increases implemented earlier in the year.

Gross margin from home sales for the 2015 fourth quarter was down 20 basis points from the same period in 2014. The decline was primarily due to a $4.4 million increase in inventory impairments coupled with higher land and construction costs. These items were partially offset by a 90 basis point improvement in our interest in cost of sales as a percent of home sale revenues, price increases implemented in various communities and a higher percentage of our deliveries coming from "build to order" sales, which typically have higher gross margins. Excluding inventory impairments, our gross margin from home sales for the 2015 fourth quarter was 17.1%* (see below for a reconciliation of non-GAAP measures), up 60 basis points year-over-year.

Selling, general and administrative expenses ("SG&A") expenses for the 2015 fourth quarter were $63.6 million, up $9.0 million from $54.6 million for the same period in 2014. Our SG&A expenses as a percentage of home sale revenues ("SG&A rate") increased by 40 basis points to 11.5% for the 2015 fourth quarter from 11.1% in the 2014 fourth quarter.  The 40 basis point increase in our SG&A rate was driven primarily by an increase in stock based compensation expense based on a stock option grant approved earlier in the year.

The dollar value of net new orders for the 2015 fourth quarter increased 26% to $450.5 million from $356.4 million for the same period in 2014. The improvement was the result of a 10% increase in our average selling price and a 15% increase in the net number of homes sold, driven primarily by an 18% improvement in our monthly sales absorption pace to 2.1, our highest fourth quarter absorption pace since 2005. The increase in average selling price was primarily the result of changes in the mix of net new orders to higher priced submarkets coupled with price increases implemented in most of our markets during the early part of 2015. Our cancellation rate for the 2015 fourth quarter was down slightly to 27% from 28% for the same period in the prior year.

Our backlog value at the end of the 2015 fourth quarter was up 59% year-over-year to $1.05 billion. The increase was due mostly to a 54% increase in units in backlog, driven primarily by year-over-year increases in net new orders for each of the past four quarters, a higher percentage of dirt sales, which are generally in backlog for a longer period of time, and longer than average construction times as a result of limited subcontractor availability.

During the 2014 fourth quarter, we completed the early redemption of $250 million in Senior Notes due July 2015. As a result of that transaction, we recognized an $8.7 million charge related to the extinguishment of debt in the 2014 fourth quarter. No such charges were incurred during 2015.

Financial Services

Income before taxes for our financial services operations for the 2015 fourth quarter was $9.1 million, a $2.1 million increase from $7.0 million in the 2014 fourth quarter. An increase in the dollar value of loans locked, originated and sold in our mortgage operations segment drove $1.3 million of the $2.1 million improvement in income before taxes. The remaining increase was primarily the result of a $1.0 million adjustment recorded during the 2015 fourth quarter in our other financial services segment to reduce insurance reserves as a result of a decline in insurance claim payment severity and frequency relative to prior period estimates.

About MDC

Since 1972, MDC's subsidiary companies have built and financed the American dream for more than 185,000 homebuyers. MDC's commitment to customer satisfaction, quality and value is reflected in each home its subsidiaries build. MDC is one of the largest homebuilders in the United States. Its subsidiaries have homebuilding operations across the country, including the metropolitan areas of Denver, Colorado Springs, Salt Lake City, Las Vegas, Phoenix, Tucson, Riverside-San Bernardino, Los Angeles, San Diego, Orange County, San Francisco Bay Area, Sacramento, Washington D.C., Baltimore, Orlando, Jacksonville, South Florida and Seattle. The Company's subsidiaries also provide mortgage financing, insurance and title services, primarily for Richmond American homebuyers, through HomeAmerican Mortgage Corporation, American Home Insurance Agency, Inc. and American Home Title and Escrow Company, respectively. M.D.C. Holdings, Inc. is traded on the New York Stock Exchange under the symbol "MDC." For more information, visit www.mdcholdings.com.

Forward-Looking Statements

Certain statements in this release, including statements regarding our business, financial condition, results of operation, cash flows, strategies and prospects, constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of MDC to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among other things, (1) general economic conditions, including changes in consumer confidence, inflation or deflation and employment levels; (2) changes in business conditions experienced by MDC, including cancellation rates, net home orders, home gross margins, land and home values and subdivision counts; (3) changes in interest rates, mortgage lending programs and the availability of credit; (4) changes in the market value of MDC's investments in marketable securities; (5) uncertainty in the mortgage lending industry, including repurchase requirements associated with HomeAmerican Mortgage Corporation's sale of mortgage loans (6) the relative stability of debt and equity markets; (7) competition; (8) the availability and cost of land and other raw materials used by MDC in its homebuilding operations; (9) the availability and cost of performance bonds and insurance covering risks associated with our business; (10) shortages and the cost of labor; (11) weather related slowdowns and natural disasters; (12) slow growth initiatives; (13) building moratoria; (14) governmental regulation, including the interpretation of tax, labor and environmental laws; (15) terrorist acts and other acts of war; (16) changes in energy prices; and (17) other factors over which MDC has little or no control. Additional information about the risks and uncertainties applicable to MDC's business is contained in MDC's Form 10-K for the year ended December 31, 2015, which is scheduled to be filed with the Securities and Exchange Commission today. All forward-looking statements made in this press release are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed in this press release will increase with the passage of time. MDC undertakes no duty to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in our subsequent filings, releases or webcasts should be consulted.

*Please see "Reconciliation of Non-GAAP Financial Measures" at the end of this release.

 

M.D.C. HOLDINGS, INC.

Consolidated Statements of Operations and Comprehensive Income



Three Months Ended


Year Ended


December 31,


December 31,


2015


2014


2015


2014


(Dollars in thousands, except per share amounts)

Homebuilding:

(Unaudited)


(Unaudited)




Home sale revenues

$

554,432


$

493,070


$

1,847,889


$

1,647,398

Land sale revenues


10,521



62



12,337



3,233

Total home and land sale revenues


564,953



493,132



1,860,226



1,650,631

Home cost of sales


(459,787)



(411,931)



(1,539,396)



(1,365,621)

Land cost of sales


(10,667)



(52)



(12,611)



(2,559)

Inventory impairments


(5,292)



(910)



(9,993)



(1,760)

Total cost of sales


(475,746)



(412,893)



(1,562,000)



(1,369,940)

Gross margin


89,207



80,239



298,226



280,691

Selling, general and administrative expenses


(63,560)



(54,601)



(226,317)



(203,253)

Interest and other income


1,297



2,222



6,709



26,310

Interest expense


-



-



-



(685)

Other expense


(1,669)



(2,279)



(4,208)



(4,813)

Losses from early extinguishments of debt


-



(8,741)



-



(18,153)

Other-than-temporary impairment of  marketable securities


(1,793)



-



(3,969)



(4,293)

Homebuilding pretax income


23,482



16,840



70,441



75,804













Financial Services:












Revenues


13,958



12,540



48,810



43,953

Expenses


(5,742)



(6,152)



(21,572)



(22,334)

Interest and other income


860



657



3,745



3,052

Financial services pretax income


9,076



7,045



30,983



24,671













Income before income taxes


32,558



23,885



101,424



100,475

Provision for income taxes


(9,963)



(9,246)



(35,633)



(37,332)

Net income

$

22,595


$

14,639


$

65,791


$

63,143













Other comprehensive income (loss) related to available for sale securities, net of tax


4,538



3,082



5,260



(1,120)

Comprehensive income

$

27,133


$

17,721


$

71,051


$

62,023













Earnings per share












Basic

$

0.47


$

0.30


$

1.35


$

1.29

Diluted

$

0.46


$

0.30


$

1.34


$

1.29













Weighted average common shares outstanding












Basic


48,788,524



48,635,629



48,764,396



48,615,541

Diluted


48,952,115



48,785,682



48,967,219



48,817,566













Dividends declared per share

$

0.25


$

0.25


$

1.00


$

1.00

 


M.D.C. HOLDINGS, INC.

Consolidated Balance Sheets



December 31,


December 31,


2015


2014

ASSETS

(Dollars in thousands, except


per share amounts)

Homebuilding:

(Unaudited)




Cash and cash equivalents

$

144,342


$

122,642

Marketable securities


92,387



140,878

Restricted cash


3,750



2,816

Trade and other receivables


23,314



28,555

Inventories:






Housing completed or under construction


747,036



732,692

Land and land under development


1,016,926



935,268

Total inventories


1,763,962



1,667,960

Property and equipment, net


28,226



30,491

Deferred tax assets, net


99,107



140,486

Metropolitan district bond securities (related party)


25,911



18,203

Prepaid and other assets


65,394



61,014

Total homebuilding assets


2,246,393



2,213,045

Financial Services:






Cash and cash equivalents


36,646



31,183

Marketable securities


11,307



15,262

Mortgage loans held-for-sale, net


115,670



88,392

Other assets


5,883



3,574

Total financial services assets


169,506



138,411

      Total Assets

$

2,415,899


$

2,351,456

LIABILITIES AND EQUITY






Homebuilding:






Accounts payable

$

40,472


$

35,445

Accrued liabilities


122,886



115,117

Revolving credit facility


15,000



15,000

Senior notes, net


840,524



839,468

Total homebuilding liabilities


1,018,882



1,005,030

Financial Services:






Accounts payable and accrued liabilities


52,114



57,268

Mortgage repurchase facility


88,611



60,822

Total financial services liabilities


140,725



118,090

      Total Liabilities


1,159,607



1,123,120

Stockholders' Equity






Preferred stock, $0.01 par value; 25,000,000 shares authorized; none issued or outstanding


-



-

Common stock, $0.01 par value; 250,000,000 shares authorized; 48,888,424 and 48,831,639 issued and outstanding at December 31, 2015 and December 31, 2014, respectively


489



488

Additional paid-in-capital


915,746



909,974

Retained earnings


324,342



307,419

Accumulated other comprehensive income


15,715



10,455

Total Stockholders' Equity


1,256,292



1,228,336

Total Liabilities and Stockholders' Equity

$

2,415,899


$

2,351,456

 

M.D.C. HOLDINGS, INC.

Consolidated Statement of Cash Flows



Three Months Ended


Year Ended


December 31,


December 31,


2015


2014


2015


2014


(Dollars in thousands)


(Unaudited)


(Unaudited)




Operating Activities:












Net income

$

22,595


$

14,639


$

65,791


$

63,143

Adjustments to reconcile net income to net cash provided by (used in) operating activities:












Losses on early extinguishments of debt


-



8,741



-



18,153

Stock-based compensation expense


3,477



1,224



10,066



5,978

Depreciation and amortization


985



1,000



4,069



3,928

Inventory impairments


5,292



910



9,993



1,760

Other-than-temporary impairment of marketable securities


1,793



-



3,969



4,293

Net loss (gain) on sale of marketable securities


785



312



911



(7,310)

Amortization of discount / premiums on marketable debt securities


-



65



100



566

Deferred income tax expense


8,551



5,863



33,333



34,226

Excess tax benefits from stock-based compensation


-



(26)



-



(26)

Net changes in assets and liabilities:












      Restricted cash


1,050



218



(934)



(621)

      Trade and other receivables


5,822



(817)



5,247



(6,638)

      Mortgage loans held-for-sale


(47,037)



(30,260)



(27,278)



4,186

      Housing completed or under construction


74,290



103,472



(15,551)



(96,936)

      Land and land under development


(63,583)



(80,998)



(89,388)



(160,463)

      Prepaid expenses and other assets


424



2,211



(7,648)



(11,873)

      Accounts payable and accrued liabilities


12,257



(16,945)



7,535



(16,013)

Net cash provided by (used in) operating activities


26,701



9,609



215



(163,647)













Investing Activities:












Purchases of marketable securities


(6,936)



(18,863)



(53,822)



(428,709)

Maturities of marketable securities


-



2,250



1,510



167,339

Sales of marketable securities


6,255



315,391



101,165



687,692

Purchases of property and equipment


(661)



(1,323)



(1,491)



(3,242)

Net cash provided by (used in) investing activities


(1,342)



297,455



47,362



423,080













Financing Activities:












Advances (payments) on mortgage repurchase facility, net


44,856



29,040



27,789



(2,252)

Proceeds from issuance of senior notes


-



-



-



248,375

Repayment of senior notes


-



(258,532)



-



(517,650)

Advances on revolving credit facility, net


-



5,000



-



15,000

Dividend payments


(12,222)



(12,204)



(48,868)



(48,820)

Excess tax benefits from stock-based compensation


-



26



-



26

Proceeds from exercise of stock options


-



312



665



375

Net cash provided by (used in) financing activities


32,634



(236,358)



(20,414)



(304,946)













Net increase (decrease) in cash and cash equivalents


57,993



70,706



27,163



(45,513)

Cash and cash equivalents:












      Beginning of period


122,995



83,119



153,825



199,338

      End of period

$

180,988


$

153,825


$

180,988


$

153,825


 

M.D.C. HOLDINGS, INC.

Homebuilding Operational Data


New Home Deliveries



 Three Months Ended December 31, 



2015


2014


 % Change



 Homes


 Dollar Value


 Average Price


 Homes


 Dollar Value


 Average Price


 Homes


 Dollar Value


 Average Price



(Dollars in thousands)


Arizona

210


$

60,129


$

286.3


200


$

62,093


$

310.5


5%


(3)%


(8)%


California

220



127,196



578.2


253



121,974



482.1


(13)%


4%


20%


Nevada

171



67,691



395.9


169



53,355



315.7


1%


27%


25%


Washington

80



35,983



449.8


59



21,918



371.5


36%


64%


21%


West

681



290,999



427.3


681



259,340



380.8


0%


12%


12%


Colorado

349



160,794



460.7


287



124,226



432.8


22%


29%


6%


Utah

54



19,194



355.4


54



17,905



331.6


0%


7%


7%


Mountain

403



179,988



446.6


341



142,131



416.8


18%


27%


7%


Maryland

47



24,168



514.2


73



36,345



497.9


(36)%


(34)%


3%


Virginia

46



22,838



496.5


54



26,029



482.0


(15)%


(12)%


3%


Florida

98



36,439



371.8


93



29,225



314.2


5%


25%


18%


East

191



83,445



436.9


220



91,599



416.4


(13)%


(9)%


5%


Total

1,275


$

554,432


$

434.8


1,242


$

493,070


$

397.0


3%


12%


10%

 




 Year Ended December 31, 



2015


2014


 % Change



 Homes


 Dollar
Value


 Average Price


 Homes


 Dollar
Value


 Average Price


 Homes


 Dollar
Value


 Average Price



(Dollars in thousands)


Arizona

753


$

220,140


$

292.4


731


$

200,994


$

275.0


3%


10%


6%


California

706



370,603



524.9


624



296,189



474.7


13%


25%


11%


Nevada

575



215,479



374.7


564



176,371



312.7


2%


22%


20%


Washington

270



109,038



403.8


267



96,496



361.4


1%


13%


12%


West

2,304



915,260



397.2


2,186



770,050



352.3


5%


19%


13%


Colorado

1,192



553,573



464.4


1,172



478,669



408.4


2%


16%


14%


Utah

149



52,794



354.3


165



53,136



322.0


(10)%


(1)%


10%


Mountain

1,341



606,367



452.2


1,337



531,805



397.8


0%


14%


14%


Maryland

215



103,148



479.8


305



144,695



474.4


(30)%


(29)%


1%


Virginia

216



105,593



488.9


234



115,001



491.5


(8)%


(8)%


(1)%


Florida

314



117,521



374.3


304



85,847



282.4


3%


37%


33%


East

745



326,262



437.9


843



345,543



409.9


(12)%


(6)%


7%


Total

4,390


$

1,847,889


$

420.9


4,366


$

1,647,398


$

377.3


1%


12%


12%

 

M.D.C. HOLDINGS, INC.

Homebuilding Operational Data


Net New Orders


 Three Months Ended December 31, 


2015


2014


% Change


Homes


Dollar
Value


Average Price


Monthly
Absorption
Rate *


Homes


Dollar Value


Average Price


Monthly
Absorption
Rate *


Homes


Dollar Value


Average Price


Monthly
Absorption
Rate *


(Dollars in thousands)

Arizona

154


$

43,448


$

282.1


1.64


141


$

39,533


$

280.4


1.31


9%


10%


1%


25%

California

160



101,300



633.1


2.81


138



68,509



496.4


2.19


16%


48%


28%


28%

Nevada

128



41,560



324.7


2.44


94



33,750



359.0


1.87


36%


23%


(10)%


30%

Washington

80



38,612



482.7


1.98


47



17,517



372.7


1.57


70%


120%


30%


26%

West

522



224,920



430.9


2.14


420



159,309



379.3


1.67


24%


41%


14%


28%

Colorado

262



122,119



466.1


2.28


266



116,740



438.9


2.18


(2)%


5%


6%


5%

Utah

40



14,343



358.6


1.72


46



14,512



315.5


2.45


(13)%


(1)%


14%


(30)%

Mountain

302



136,462



451.9


2.19


312



131,252



420.7


2.21


(3)%


4%


7%


(1)%

Maryland

56



26,253



468.8


1.74


44



21,992



499.8


1.30


27%


19%


(6)%


34%

Virginia

64



33,159



518.1


2.25


49



24,031



490.4


1.72


31%


38%


6%


31%

Florida

76



29,694



390.7


1.72


62



19,776



319.0


1.45


23%


50%


22%


19%

East

196



89,106



454.6


1.87


155



65,799



424.5


1.48


26%


35%


7%


26%

Total

1,020


$

450,488


$

441.7


2.10


887


$

356,360


$

401.8


1.78


15%


26%


10%


18%

 



 Year Ended December 31, 


2015


2014


% Change


Homes


Dollar
Value


Average Price


Monthly
Absorption
Rate *


Homes


Dollar Value


Average Price


Monthly
Absorption
Rate *


Homes


Dollar Value


Average Price


Monthly
Absorption
Rate *


(Dollars in thousands)

Arizona

843


$

241,192


$

286.1


2.07


802


$

235,041


$

293.1


2.04


5%


3%


(2)%


1%

California

856



506,445



591.6


3.55


669



327,248



489.2


3.22


28%


55%


21%


10%

Nevada

615



227,560



370.0


3.62


579



192,708



332.8


2.93


6%


18%


11%


24%

Washington

394



173,071



439.3


2.50


276



102,795



372.4


2.30


43%


68%


18%


9%

West

2,708



1,148,268



424.0


2.77


2,326



857,792



368.8


2.54


16%


34%


15%


9%

Colorado

1,435



687,695



479.2


2.97


1,334



576,322



432.0


2.88


8%


19%


11%


3%

Utah

217



79,203



365.0


2.58


179



59,304



331.3


2.55


21%


34%


10%


1%

Mountain

1,652



766,898



464.2


2.91


1,513



635,626



420.1


2.84


9%


21%


10%


2%

Maryland

237



116,010



489.5


2.02


244



117,646



482.2


1.43


(3)%


(1)%


2%


41%

Virginia

227



114,713



505.3


2.12


221



111,068



502.6


1.96


3%


3%


1%


8%

Florida

379



143,594



378.9


2.18


319



109,141



342.1


1.85


19%


32%


11%


18%

East

843



374,317



444.0


2.12


784



337,855



430.9


1.72


8%


11%


3%


23%

Total

5,203


$

2,289,483


$

440.0


2.68


4,623


$

1,831,273


$

396.1


2.43


13%


25%


11%


10%


* Calculated as total net new orders in period ÷ average active communities during period ÷ number of months in period

 

M.D.C. HOLDINGS, INC.

Homebuilding Operational Data


Active Subdivisions




December 31,


%



2015


2014


Change


Arizona

32


36


(11)%


California

20


19


5%


Nevada

20


16


25%


Washington

14


10


40%


West

86


81


6%


Colorado

40


40


0%


Utah

7


6


17%


Mountain

47


46


2%


Maryland

11


9


22%


Virginia

9


10


(10)%


Florida

14


13


8%


East

34


32


6%


Total

167


159


5%


Average for Quarter Ended

162


166


(2)%


Average for Year Ended

161


158


2%

 

Backlog




At December 31,



2015


2014


% Change



Homes


Dollar
Value


Average Price


Homes


Dollar
Value


Average Price


Homes


Dollar
Value


Average Price



(Dollars in thousands)


Arizona

321


$

89,464


$

278.7


231


$

75,419


$

326.5


39%


19%


(15)%


California

342



220,755



645.5


192



98,057



510.7


78%


125%


26%


Nevada

195



67,901



348.2


155



61,020



393.7


26%


11%


(12)%


Washington

179



80,134



447.7


55



20,655



375.5


225%


288%


19%


West

1,037



458,254



441.9


633



255,151



403.1


64%


80%


10%


Colorado

822



390,635



475.2


579



266,280



459.9


42%


47%


3%


Utah

108



38,549



356.9


40



13,580



339.5


170%


184%


5%


Mountain

930



429,184



461.5


619



279,860



452.1


50%


53%


2%


Maryland

90



43,317



481.3


68



34,293



504.3


32%


26%


(5)%


Virginia

101



52,622



521.0


90



45,521



505.8


12%


16%


3%


Florida

174



70,837



407.1


109



48,412



444.1


60%


46%


(8)%


East

365



166,776



456.9


267



128,226



480.2


37%


30%


(5)%


Total

2,332


$

1,054,214


$

452.1


1,519


$

663,237


$

436.6


54%


59%


4%

 

M.D.C. HOLDINGS, INC.

Homebuilding Operational Data


Homes Completed or Under Construction (WIP lots)




December 31,





2015


2014


% Change


Unsold:







Completed

189


483


(61)%


Under construction

334


583


(43)%


Total unsold started homes

523


1,066


(51)%


Sold homes under construction or completed

1,697


1,089


56%


Model homes under construction or completed

281


272


3%


Total homes completed or under construction

2,501


2,427


3%

 

Lots Owned and Options (including homes completed or under construction)




December 31, 2015


December 31, 2014





Lots Owned


Lots Optioned


Total


Lots Owned


Lots Optioned


Total


Total % Change


Arizona

1,735


201


1,936


2,266


45


2,311


(16)%


California

1,759


352


2,111


1,600


94


1,694


25%


Nevada

2,240


100


2,340


1,589


286


1,875


25%


Washington

832


107


939


886


-


886


6%


West

6,566


760


7,326


6,341


425


6,766


8%


Colorado

4,086


832


4,918


4,083


929


5,012


(2)%


Utah

442


-


442


598


-


598


(26)%


Mountain

4,528


832


5,360


4,681


929


5,610


(4)%


Maryland

368


219


587


417


417


834


(30)%


Virginia

562


158


720


525


469


994


(28)%


Florida

1,078


230


1,308


891


184


1,075


22%


East

2,008


607


2,615


1,833


1,070


2,903


(10)%


Total

13,102


2,199


15,301


12,855


2,424


15,279


0%

 

M.D.C. HOLDINGS, INC.

Reconciliations of Non-GAAP Financial Measures


Gross Margin from Home Sales Excluding Interest and Impairments (Unaudited)


Gross Margin from Home Sales Excluding Impairments and Gross Margin from Home Sales Excluding Interest and Impairments are non-GAAP financial measures. We believe this information is meaningful as it isolates the impact that interest and impairments have on our Gross Margin from Home Sales and permits investors to make better comparisons with our competitors, who also break out and adjust gross margins in a similar fashion.




 Three Months Ended



December 31,

2015


Gross Margin %


 December 31, 2014


Gross Margin %



(Dollars in thousands)


Gross Margin

$

89,207


15.8%


$

80,239


16.3%


Less: Land Sale Revenues


(10,521)





(62)




Add: Land Cost of Sales


10,667





52




Gross Margin from Home Sales


89,353


16.1%



80,229


16.3%


Add: Inventory Impairments


5,292





910




Gross Margin from Home Sales Excluding Inventory Impairments


94,645


17.1%



81,139


16.5%


Add: Interest in Cost of Sales


14,943





17,296




Gross Margin from Home Sales Excluding Inventory Impairments and Interest in Cost of Sales

$

109,588


19.8%


$

98,435


20.0%

























Year Ended



 December 31, 2015


Gross Margin %


 December 31, 2014


Gross Margin %



(Dollars in thousands)


Gross Margin

$

298,226


16.0%


$

280,691


17.0%


Less: Land Sale Revenues


(12,337)





(3,233)




Add: Land Cost of Sales


12,611





2,559




Gross Margin from Home Sales


298,500


16.2%



280,017


17.0%


Add: Inventory Impairments


9,993





1,760




Gross Margin from Home Sales Excluding Inventory Impairments


308,493


16.7%



281,777


17.1%


Add: Interest in Cost of Sales


54,751





60,508




Gross Margin from Home Sales Excluding Inventory Impairments and Interest in Cost of Sales

$

363,244


19.7%


$

342,285


20.8%

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/mdc-holdings-announces-2015-full-year-and-fourth-quarter-results-300214340.html

SOURCE M.D.C. Holdings, Inc.

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