Tri Pointe Homes, Inc. · NYSE:TPH
Tri Pointe Homes — TRI Pointe Group — Q1 2018 Earnings Presentation
33 slides from Tri Pointe Homes's earnings presentation, Apr 25, 2018
Slide 1: 2018 First Quarter Results
2018 First Quarter Results Maracay Homes® – Pardee Homes® – Quadrant Homes® – Trendmaker® Homes – TRI Pointe Homes® – Winchester® Homes
Slide 2: Forward Looking Statement
Forward Looking Statement Various statements contained in this presentation, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact, are forward-looking statements. These forward-looking statements may include, but are not limited
Slide 3: Management Team
Management Team Thomas Mitchell Douglas Bauer Michael Grubbs President & COO Chief Executive Officer Chief Financial Officer • Over 30 years of real estate • Over 30 years of real estate • Over 30 years of real estate and homebuilding experience and homebuilding experience and homebuilding experienc
Slide 4: A Family of Regional Homebuilders
A Family of Regional Homebuilders Market: Seattle Metro Area LTM Orders: 383 LTM Deliveries: 372 LTM HS Revenue: $266,928 LTM ASP: $718 Lots Owned or Controlled: 1,773 Markets: Los Angeles, Inland Empire, San Diego, Las Vegas LTM Orders: 1,675 LTM Deliveries: 1,509 LTM HS Revenue: $853,204 LTM ASP:
Slide 5: 2018 First Quarter Highlights
2018 First Quarter Highlights
Slide 6: 2018 First Quarter Highlights
2018 First Quarter Highlights • Absorption rate of 3.8 new home orders per Metric 1Q18 1Q17 % Change community per month Orders 1,496 1,299 15% • New home deliveries up 22% to 924 with an Deliveries 924 758 22% average sales price of $630,000 ASP of Home Deliveries ($mm) $630 $517 22% • Backlog unit
Slide 7: Active Selling Communities and Absorption Rate
Active Selling Communities and Absorption Rate Q1 2018 Results Active Selling Communities and Absorption Rate Active Selling Communities by State As of and for the quarters ended March 31, 2017 and 2018 As of March 31, 2018 140 131 4.5 Washington 123 Arizona 4.0 Virginia 5% 120 3.8 11% 3% 3.5 3.5 10
Slide 8: New Home Orders – Q1 2018 Results
New Home Orders – Q1 2018 Results New Home Orders New Home Orders by State For the quarters ended March 31, 2017 and 2018 For the quarter ended March 31, 2018 1,600 Washington 1,496 Arizona Virginia 7% 10% 1,400 1,299 3% Texas 1,200 10% 1,000 Colorado 800 7% Increase 15% YOY 600 California 42% 400 N
Slide 9: Backlog – Units and Dollar Value – Q1 2018 Results
Backlog – Units and Dollar Value – Q1 2018 Results Backlog – Units and Dollar Value Backlog Dollar Value by State As of March 31, 2017 and 2018 (dollars in thousands) As of March 31, 2018 2,200 2,143 $1,600,000 Washington Arizona 2,000 $1,409,042 10% 9% $1,400,000 Virginia 1,800 1,734 2017 3% 1,600
Slide 10: New Home Deliveries – Q1 2018 Results
New Home Deliveries – Q1 2018 Results New Home Deliveries New Home Deliveries by State As of and for the quarters ended March 31, 2017 and 2018 For the quarter ended March 31, 2018 1,000 Washington 924 Arizona 900 9% Virginia 14% 800 758 2% Texas 700 9% 600 500 Colorado 7% Increase 22% YOY 400 300 N
Slide 11: Home Sales Revenue – Q1 2018 Results
Home Sales Revenue – Q1 2018 Results Home Sales Revenue Home Sales Revenue by State For the quarters ended March 31, 2017 and 2018 (dollars in thousands) For the quarter ended March 31, 2018 $600,000 $582,572 Washington Arizona $500,000 10% 10% Virginia 3% $400,000 $392,004 Texas 7% $300,000 Colorad
Slide 12: SG&A Expenses, Income before Taxes and Net Income – Q1 2018
SG&A Expenses, Income before Taxes and Net Income – Q1 2018 Results Selling, General and Administrative Expenses Income before Taxes, Net Income available to For the quarters ended March 31, 2017 and 2018 (dollars in thousands) Common Stockholders and EPS (Diluted) For the quarters ended March 31, 2
Slide 13: Orders, Deliveries and Absorption Rate by Segment
Orders, Deliveries and Absorption Rate year over year comparisons for the First Quarter 2018 by Segment (Includes breakout by state for Pardee Homes and TRI Pointe Homes brands)
Slide 14: Orders, Deliveries and Absorption Rate
Orders, Deliveries and Absorption Rate Orders, Deliveries and Absorption Rate For the quarters ended March 31, 2017 and 2018 For the quarters ended March 31, 2017 and 2018 200 4.5 140 6.0 184 5.3 180 4.0 120 5.1 3.9 120 153 108 5.0 160 3.7 3.5 140 100 125 3.0 4.0 119 83 120 80 2.5 100 63 3.0 2.0 60
Slide 15: Orders, Deliveries and Absorption Rate
Orders, Deliveries and Absorption Rate Orders, Deliveries and Absorption Rate For the quarters ended March 31, 2017 and 2018 For the quarters ended March 31, 2017 and 2018 160 155 2.0 160 4.0 151 148 1.7 3.7 140 140 3.5 1.6 3.2 120 1.5 120 113 3.0 106 100 100 89 2.5 84 80 1.0 80 2.0 66 Decrease 21%
Slide 16: California / Nevada Orders, Deliveries and Absorption Rate
California Nevada Orders, Deliveries and Absorption Rate Orders, Deliveries and Absorption Rate For the quarters ended March 31, 2017 and 2018 For the quarters ended March 31, 2017 and 2018 300 6.0 250 5.0 271 264 4.6 4.5 250 5.0 5.0 202 5.1 200 4.0 191 3.5 200 4.0 3.4 150 3.0 150 3.0 114 2.5 121 10
Slide 17: California / Colorado Orders, Deliveries and Absorption Rate
California Colorado Orders, Deliveries and Absorption Rate Orders, Deliveries and Absorption Rate For the quarters ended March 31, 2017 and 2018 For the quarters ended March 31, 2017 and 2018 400 5.0 120 5.0 4.9 357 4.4 4.5 102 4.5 350 4.1 100 4.0 4.0 300 300 3.5 3.5 3.5 80 250 3.0 3.0 209 60 200 17
Slide 18: 2014–2017 Historical Results with 2018 Guidance Ranges
2014–2017 Historical Results with 2018 Guidance Ranges
Slide 19: Average Selling Communities and Absorption Rate
Average Selling Communities and Absorption Rate Average Selling Communities and Absorption Rate Average Selling Communities by State As of and for the years ended December 31, 2014 through 2017 and 2018 projections For the year ended December 31, 2017 150 4.0 Washington 133 6% Arizona 127 3.5 Virgin
Slide 20: New Home Deliveries – FY 2014 through FY 2017
New Home Deliveries – FY 2014 through FY 2017 New Home Deliveries New Home Deliveries by State For the quarters ended March 31, 2014 through 2017 and 2018 projections For the year ended December 31, 2017 Guidance Range of Deliveries 6,000 Washington Arizona 5,400 Virginia 7% 13% 5,000 5,100 3% Incre
Slide 21: Home Sales Revenue – FY 2014 through FY 2017
Home Sales Revenue – FY 2014 through FY 2017 Home Sales Revenue Home Sales Revenue by State For the years ended December 31, 2014 through 2017 and 2018 projections For the year ended December 31, 2017 (dollars in millions) Guidance Range of Home Sales $3,500 Revenue $3,294 $3,000 Washington Arizona
Slide 22: SG&A Expenses, Income before Taxes and Net Income – FY 2014–2017
SG&A Expenses, Income before Taxes and Net Income – FY 2014 through FY 2017 Selling, General and Administrative Expenses Income before Taxes, Net Income available to For the years ended December 31, 2014 through 2017 (dollars in thousands) Common Stockholders and EPS (Diluted) For the full years end
Slide 23: 2018 Outlook
2018 Outlook
Slide 24: Full Year 2018 Outlook
Full Year 2018 Outlook Full Year 2018 Outlook • Expect to grow average selling communities by 5% for the full year • Anticipate delivering between 5,100 and 5,400 homes at an average sales price of approximately $610,000 • Anticipate homebuilding gross margin for the full year in a range of 21.0% to
Slide 25: Second Quarter 2018 Outlook
Second Quarter 2018 Outlook Second Quarter 2018 Outlook • Expect to open 16 new communities and close out of 19, resulting in 128 active selling communities as of June 30, 2018 • Anticipate delivering 50% to 55% of the 2,143 homes in backlog as of March 31, 2018 at an average sales price range of $6
Slide 26: Land Supply, Orders by Month, Debt
Land Supply Orders by Month Debt
Slide 27: Significant Land Supply to Fuel Growth
Significant Land Supply to Fuel Growth Combined Lot Position As of March 31, 2018 . Note: Dollars in thousands Implied years Market Owned Controlled (1) Total Lots % Owned Inventory Dollars LTM Deliveries of Supply (2) California 15,300 840 16,140 95% $1,725,568 2,194 7.4 Colorado 587 195 782 75% $1
Slide 28: New Home Orders – Historical by Month
New Home Orders – Historical by Month 1Q18 Orders up 15% YOY 600 571 550 524 500 477 468 477 477 2016 459 445 444 431 437 2017 450 418 425 409 400 2018 400 377 375 356 346 354 345 350 334 322 306 297 300 280 267 250 200 150 100 50 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2018 - 3.54 3.63 4.
Slide 29: Selected Balance Sheet Metrics
Selected Balance Sheet Metrics Selected Balance Sheet Metrics $ in thousands 3/31/2018 12/31/2017 • During the quarter, the Company Cash and cash equivalents $ 324,608 $ 282,914 did not use any proceeds from its Real estate inventories $ 3,145,555 $ 3,105,553 unsecured revolving credit facility. Tot
Slide 30: Supplemental Data and Reconciliation
Supplemental Data and Reconciliation
Slide 31: Reconciliation of Non-GAAP Financial Measures (unaudited)
Reconciliation of Non-GAAP Financial Measures (unaudited) In this presentation, we utilize certain financial measures that are non-GAAP financial measures as defined by the Securities and Exchange Commission. We present these measures because we believe they and similar measures are useful to manage
Slide 32: Reconciliation of Non-GAAP Financial Measures (cont'd)
Reconciliation of Non-GAAP Financial Measures (cont’d)(unaudited) The following table reconciles the Company’s ratio of debt-to-capital to the ratio of net debt-to-net capital. We believe that the ratio of net debt-to-net capital is a relevant financial measure for management and investors to unders
Slide 33: Reconciliation of Non-GAAP Financial Measures (cont'd)
Reconciliation of Non-GAAP Financial Measures (cont’d)(unaudited) The following table contains information about our operating results reflecting certain adjustments to income before income taxes, (provision) benefit for income taxes, net income, net income available to common stockholders and earni