35 slides from D.r. Horton's earnings presentation, Oct 29, 2024
Slide 1: Investor Presentation Q4 2024
Investor Presentation Q4 2024
Slide 2: 125 Markets, 36 States: America's #1 Homebuilder
125 Markets 36 States be iad AMERICA’S #1 HOMEBUILDER SINCE 2002 D-RHORTON Sumericas Buitder
Slide 3: Forward-Looking Statements
Forward-Looking Statements This presentation may include “forward‐looking statements” as defined by the Private Securities Litigation Reform Act of 1995. Although D.R. Horton believes any such statements are based on reasonable assumptions, there is no assurance that actual outcomes will not be mate
Slide 4: At A Glance
At A Glance 14,800 Traded on NYSE as DHI 23 Years as America’s Largest Builder Employees $2.2B 57% 19.9% First-Time Homebuyers Return on Equity Returned to Shareholders Of those who used DHI Mortgage for Through share repurchases & dividends financing 16.1% $2.2B Cash Flow from Operations HB Pre-Tax
Slide 5: Growth in Market Share
Growth in Market Share 2024 Closings: 1,400 93,660 14% 93,660 Homes Closed during fiscal year ended 9/30/2024 1,200 12% 1,000 10% 800 8% 600 2006 Closings: 6% 53,410 2011 Closings: 17,176 400 4% 1992 Closings: 200 1,231 2% 0 0% Total U.S. Single-Family New Home Sales ('000s) DHI Homes Closed as a Pe
Slide 6: Market Share Dominance
Market Share Dominance D.R. Horton is the largest builder in 4 of the top 5 U.S. housing markets & in 59 of the 121 markets in which we operated at June 30, 2024 Top 5 U.S. Housing Markets D.R. Horton Markets 18% 130 16% 120 119 121 110 14% 112 100 12% 90 80 10% 70 8% 60 50 59 6% 40 4% 30 20 2% 10 0
Slide 7: Management Tenure And Experience
Management Tenure And Experience Executive Team ~27 years Region Presidents & Vice Presidents ~20 years Division Presidents & City Managers ~13 years Average employee tenure as of 9/30/24
Slide 8: Diverse Product Offerings And Price Points
Diverse Product Offerings And Price Points Homes for entry-level, move-up, active adult and luxury buyers 69% of homes closed <$400k 24% $0 - $300k 25% $301k - $350k 20% $351k - $400k 20% $401k - 500k 11% >$500K 0% 5% 10% 15% 20% 25% 30% Represents price points of homes closed for the fiscal year en
Slide 9: Then & Now: DHI Today vs. 2005
Then & Now: DHI Today vs. 2005 DHI’s business model has changed – strong balance sheet, low risk land position and cash flow generation Enhanced Financial Position De-Risked Lot Pipeline 47.8% 3.0 $7,556 1.7 18.9% 190,245 480,400 $2,366 155,655 152,500 9/30/2005 9/30/2024 9/30/2005 9/30/2024 Liquidi
Slide 10: Total Shareholder Returns
Total Shareholder Returns D.R. Horton’s total shareholder return (TSR) ranks in the top quartile of all S&P 500 companies 3-Year TSR 5-Year TSR 10-Year TSR +244% TSR 1st Quartile 91st Percentile 1st Quartile +540% TSR 1st Quartile 88th Percentile +61% TSR 80th Percentile 2nd Quartile 2nd Quartile 2n
Slide 11: Value Creation Strategy Will Continue to Produce Best-in-Class Returns
Value Creation Strategy Will Continue to Produce Best-in-Class Returns Disciplined focus on returns, consistent cash flow generation and balanced capital allocation drives shareholder value
Slide 12: Return On Equity
Return On Equity D.R. Horton’s average annual return on equity (ROE) ranks in the upper half of all S&P 500 companies 3-Year ROE 5-Year ROE 10-Year ROE 1st Quartile 1st Quartile 1st Quartile +26% ROE +26% ROE 69th Percentile 71st Percentile +23% ROE 2nd Quartile 2nd Quartile 66th Percentile 2nd Quar
Slide 13: Homebuilding Pre-Tax Return On Inventory
Homebuilding Pre-Tax Return On Inventory Manufacturing business model focused on operating and capital efficiency to produce strong returns and consistent cash flow 45% 40% 42.8% 35% 37.9% 30% 29.7% 25% 27.8% 20% 15% 10% 5% 0% FY 2021 FY 2022 FY 2023 FY2024 Homebuilding ROI is calculated as homebuil
Slide 14: Return On Assets
Return On Assets D.R. Horton’s average annual return on assets (ROA) ranks in the top quartile of all S&P 500 companies 3-Year ROA 5-Year ROA 10-Year ROA +17% ROA +17% ROA 91st Percentile 1st Quartile 91st Percentile 1st Quartile +14% ROA 1st Quartile 87th Percentile 2nd Quartile 2nd Quartile 2nd Qu
Slide 15: Consolidated Pre-Tax Profit Margin
Consolidated Pre-Tax Profit Margin Consolidated pre-tax profit margin of 17.1% in FY24 on a 4% increase in Rev $ revenues to $36.8 billion PTI % $40 25% 22.8% $35 $36.8 19.3% $35.5 20% $30 $33.5 17.8% 17.1% $25 $27.8 15% $20 10% $15 $10 5% $5 $7.6 $6.3 $6.3 $5.4 $0 0% FY 2021 FY 2022 FY 2023 FY2024
Slide 16: Strong Track Record of Exceptional Financial Performance
Strong Track Record of Exceptional Financial Performance Diluted Earnings Per Share ($) Book Value Per Share ($) Consolidated Revenues ($ billions) $16.51 $78.12 $36.8 $35.5 $33.5 $14.34 $67.78 $13.82 $27.8 $56.39 $11.41 $20.3 $41.81 $17.6 $32.53 $6.41 $27.20 $4.29 FY19 FY20 FY21 FY22 FY23 FY24 FY19
Slide 17: Increasing Shareholder Distributions
Increasing Shareholder Distributions We expect to generate more cash flow from operations in FY25 than FY24 and to utilize a substantial portion for returns to shareholders $3,000 FY24 shareholder distributions increased 44% from FY23 $2,900* $500* $2,500 $2,183 $2,000 $395 $1,449 $1,520 $1,500 $1,1
Slide 18: Capital And Cash Flow Priorities
Capital And Cash Flow Priorities • Focused on generating consistent and increasing cash flows from operations • Balanced, disciplined, flexible and opportunistic capital allocation to enhance long-term value • Invest in homebuilding and other business platforms to grow and increase market share • Ma
Slide 19: Homebuilding Operational Focus
Homebuilding Operational Focus • Provide value, quality and positive experience and service to homebuyers • Maximize returns and generate strong cash flows by managing sales pace and pricing in each community • Manage land, lot and home inventory efficiently to meet demand and gain market share • Mi
Slide 20: Rental Operations
Rental Operations Develop, construct, lease and sell single-family and multi-family residential properties Generated $228.7 million of pre-tax income on $1.7 billion of revenues in fiscal 2024 Single-Family Rental Multi-Family Rental FY24 FY23 FY24 FY23 Revenues $1.18B $2.01B Revenues $507.7M $590.7
Slide 21: Forestar
Forestar • DHI owns 62% of Forestar, a publicly traded residential lot developer (NYSE: FOR) • Operations in 59 markets and 24 states • Uniquely positioned to aggregate significant market share of lot sales to homebuilders • Supports DHI’s strategy to control land and lots through purchase contracts
Slide 22: Expectations
Expectations Although volatility in mortgage rates and changes in economic conditions could have significant impacts, the Company’s expectations for FY 2025 are as follows: Q1 FY 2025 • Consolidated revenues in a range of $6.8 billion to $7.3 billion • Homes closed between 17,500 homes and 18,000 ho
Slide 23: Fourth Quarter Data
Fourth Quarter Data
Slide 24: Q4 FY 2024 Highlights
Q4 FY 2024 Highlights • Earnings per diluted share were $3.92 on net income of $1.3 billion • Consolidated pre-tax income of $1.7 billion, with a pre-tax profit margin of 17.1% • Consolidated revenues of $10.0 billion • Home sales revenues increased 2% to $8.9 billion on 23,647 homes closed • Net sa
Slide 25: Homes Closed And Revenues
Homes Closed And Revenues Home sales revenues of $8.9 billion on 23,647 homes closed by homebuilding operations in Q4 FY24 Homes Closed Home Sales Revenues # of Homes Revenues 25,000 23,212 23,647 $9,369 $10,000 22,928 $8,929 $8,779 20,000 $8,000 15,000 $6,000 10,000 $4,000 5,000 $2,000 0 $- 4Q FY22
Slide 26: Income Statement
Income Statement $ in millions except per share data
Slide 27: Home Sales Gross Margin
Home Sales Gross Margin Home sales gross margin fluctuating primarily due to interest rates and incentive levels 32% 28% 28.7% 24% 25.5% 23.5% 24.0% 23.6% 23.5% 22.9% 23.2% 20% 16% 12% 8% 4% 0% FY 2021 FY 2022 FY 2023 1Q24 2Q24 3Q24 4Q24 FY2024 Shown as a % of the Company’s homebuilding segment’s ho
Slide 28: Homebuilding SG&A
Homebuilding SG&A Controlling SG&A while ensuring that our platform adequately supports future growth Fiscal Year Fourth Fiscal Quarter HB Rev $ SG&A % HB Rev $ SG&A % $36,000 12% $14,000 12% $32,000 $12,000 11% 11% $28,000 10% $10,000 10% $24,000 $20,000 9% $8,000 9% $16,000 8% $6,000 8% $12,000 7.
Slide 29: Consolidated Pre-Tax Income
Consolidated Pre-Tax Income Q4 FY24 consolidated pre-tax income was $1.7 billion, with a profit margin of 17.1% Fiscal Year Fourth Fiscal Quarter PTI $ PTI $ 17.8% 17.1% $2,400 $6,000 $6,314.7 $6,284.7 $5,400 $2,100 19.2% $4,800 $1,800 $2,018.3 17.1% $4,200 $1,500 $1,709.7 $3,600 $3,000 $1,200 $2,40
Slide 30: Balance Sheet
Balance Sheet $ in millions except per share metrics Homebuilding cash and cash equivalents presented above includes $4.8 million and $6.5 million of restricted cash for the periods ended 9/30/2024 and 9/30/2023, respectively
Slide 31: Homes In Inventory
Homes In Inventory Faster housing turns support more efficient housing inventory levels 70,000 60,000 50,000 47,800 46,400 42,000 40,000 37,400 30,000 20,000 10,000 0 9/30/21 9/30/22 9/30/23 9/30/24 Sold Specs Homes in inventory excluding model homes
Slide 32: Homebuilding Land And Lot Position
Homebuilding Land And Lot Position Strong, flexible land and lot pipeline 24% owned / 76% controlled at 9/30/24 700,000 632,900 600,000 573,200 568,400 530,300 500,000 400,000 480,400 442,100 427,300 402,500 300,000 200,000 100,000 127,800 131,100 141,100 152,500 0 9/30/21 9/30/22 9/30/23 9/30/24 Ow
Slide 33: Appendix
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Slide 34: Geographic Diversification: 125 Markets | 36 States
Geographic Diversification 125 Markets | 36 States D.R. Horton is the most geographically diverse homebuilder in the U.S. HB Revenue Inventory Northwest 8% 10% Southwest 14% 16% South Central 23% 19% Southeast 26% 22% East 18% 20% North 11% 13% As of or for the fiscal year ended September 30, 2024 |
Slide 35: Homebuilding Public Debt Maturities By Year
Homebuilding Public Debt Maturities By Year As of October 16, 2024 $800 $700 $700 $600 $600 $500 $500 $500 $400 $300 2.60% 1.30% 1.40% 5.00% $200 $100 $0 FY 26 FY 27 FY 28 FY 29 FY 30 FY 31 FY 32 FY 33 FY 34 FY 35 $ in millions