Green Brick Partners, Inc. · NYSE:GRBK
Green Brick Partners — Q4 2017 Earnings Presentation
21 slides from Green Brick Partners's earnings presentation, Mar 12, 2018
Slide 1: Green Brick Partners Q4 2017 Investor Call Presentation
Exhibit 99.2 GREEN BRICK PARTNERS Q4 2017 INVESTOR CALL PRESENTATION MARCH 12, 2018 1
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This presentation and the oral statements made by representatives of the Company during the course of this presentation that are not historical facts are forward-looking statements. These statements are often, but not always, made through the use of words or phrases such a
Slide 3: Management Presenters
MANAGEMENT PRESENTERS Jim Brickman Chief Executive Officer • Over 40 years in real estate development and homebuilding. • Co-founded JBGL with Greenlight Capital in 2008. JBGL was merged into Green Brick in 2014. • Previously served as Chairman and CEO of Princeton Homes and Princeton Realty Corp. R
Slide 4: Market Update: Housing market is under supplied
MARKET UPDATE The housing market is being under supplied • Demand is there; the new challenge is building new homes that buyers want in locations they can afford. 4
Slide 5: Market Update: Top job growth markets
MARKET UPDATE Housing starts are highly correlated to jobs and we build in two of the highest job growth markets National Economic Overview Top Job Growth Markets Ranked by Change in Employment – December 2017 Source: Metrostudy - MetroUSA 5
Slide 6: Market Update: Less than 2.0% of starts in two large markets
MARKET UPDATE We are less than 2.0% of the starts in two of the largest housing markets, giving us significant opportunity for growth GRBK has also entered the Colorado Springs market through our investment in Challenger Homes. Source: Metrostudy - MetroUSA 6
Slide 7: Market Update: Dallas 6-year expansion
MARKET UPDATE Dallas market continues 6-year expansion but is still well below prior peak Dallas/Fort Worth Market SFD-TH – Starts and closings 45,000 Annual Starts Annual Closings 40,000 35,000 33,243 30,000 Annual Starts & Closings 31,708 25,000 20,000 15,000 10,000 5,000 Source: Metrostudy - Metr
Slide 8: Market Update: Dallas lots and starts
MARKET UPDATE GRBK has almost 4,600 lots in Dallas where the market continues its 7-year trend of constrained supply Dallas/Fort Worth Market Lot Inventory 100,000 Vacant Developed Lots 80.0 Annual Starts 90,000 VDL Months of Supply 70.0 80,000 60.0 70,000 Months of Supply 50.0 60,000 Lots/Starts 50
Slide 9: Market Update: Atlanta market expansion
MARKET UPDATE The Atlanta market also continues to expand but is still well below prior peak Atlanta AtlantaRegion 16Year Region 16 YearHistory History Annual Annual Construction Starts Construction Startsand Closings and Closings 2Q06 Peaked 2Q06 Peaked 60,000 55,000 50,000 72% of activity is in No
Slide 10: Green Brick at a Glance
GREEN BRICK AT A GLANCE • We are a diversified homebuilding and land development company Controlled Builders • We build and deliver homes through our Dallas Products offered controlled builders in which we own a 50% CB JENI Townhomes controlling interest as well as our investment in unconsolidated b
Slide 11: Challenger Homes
CHALLENGER HOMES • On August 15, 2017, GRBK acquired a 49.9% ownership of Challenger Homes, effective August 1, 2017 • With this investment in an unconsolidated subsidiary, Green Brick has expanded into Colorado Springs and the Pikes Peak Region: • In January 2017, Forbes declared the region one of
Slide 12: Corporate Structure
CORPORATE STRUCTURE • We are a diversified homebuilding and land development company with strong sponsor ownership and controlling interests in our aligned homebuilders. 50% 50% 50% 50% 49.99% 100% 12
Slide 13: Quarterly Spotlight: Heritage Creekside, Plano, TX
QUARTERLY SPOTLIGHT Heritage Creekside, Plano, TX – Modern Townhomes in the Heart of a Connected Community • Heritage Creekside is a neighborhood made up of creek side urban apartments, lofts, townhomes and single-family homes all within walking distance from a mix of shops, restaurants, hotels, off
Slide 14: GRBK: A True Growth Story
GRBK: A TRUE GROWTH STORY We have the strong balance sheet and operational excellence for continued growth 14
Slide 15: Balance Sheet Strength
BALANCE SHEET STRENGTH GRBK has one of the lowest debt-to-capital ratios amongst public builders • GRBK net debt to capital is about 16% versus an average 40% for covered public builders • GRBK’s eventual target is approximately 35% Net Debt to Total Capital Q4 2017 Source: Company filings. Data for
Slide 16: Financial Highlights
FINANCIAL HIGHLIGHTS Quarter over Quarter Year over Year Q4 2016 Q4 2017 Increase 2016 2017 Increase Net New Home Orders 197 265 35% 880 1,063 21% Home Closings - Units 275 292 6% 844 990 17% Home Closing Revenues $117.0 $133.5 14% $365.2 $435.6 19% Ending Active Selling Communities 50 55 10% Homes
Slide 17: Operational Highlights
OPERATIONAL HIGHLIGHTS LTM Adjusted Gross Margins LTM GRBK Pre-Tax Income to Homebuilding Revenues 17
Slide 18: Key Takeaways
KEY TAKEAWAYS • Significant growth opportunities exist in Dallas, Atlanta and Colorado Springs ̶ three of the most attractive homebuilder markets in the U .S. • We have the four pillars to support significant growth: lot position, balance sheet, management team, and builders. • Proven success in exe
Slide 19: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION GRBK Pre-tax Income as a Percentage of Homebuilding Revenues 12 Months 12 Months 12 Months 12 Months 12 Months Ended Ended Ended Ended Ended (Unaudited, in thousands) Dec 31, 2016 Mar 31, 2017 June 30, 2017 Sep 30, 2017 Dec 31, 2017 LTM Net income attributable to Green Brick
Slide 20: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION Adjusted Homebuilding Gross Margin Reconciliation 12 Months 12 Months 12 Months 12 Months 12 Months Ended Ended Ended Ended Ended (Unaudited, in thousands) Dec 31, 2016 Mar 31, 2017 June 30, 2017 Sep 30, 2017 Dec 31, 2017 Sale of Residential Units $365,164 $391,933 $398,546 $
Slide 21: Contact: 2805 North Dallas Parkway, Plano, TX
2805 North Dallas Parkway, Suite 400 Plano, TX 75093 www.greenbrickpartners.com 21