Tri Pointe Homes, Inc. · NYSE:TPH
Tri Pointe Homes — TRI Pointe Group — Q3 2016 Earnings Presentation
28 slides from Tri Pointe Homes's earnings presentation, Oct 27, 2016
Slide 1: 2016 Third Quarter Results
2016 Third 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 projections and esti
Slide 3: Management Team
Management Team Thomas Mitchell Douglas Bauer Michael Grubbs President & COO Chief Executive Officer Chief Financial Officer • Over 25 years of real estate • Over 25 years of real estate • Over 25 years of real estate and homebuilding and homebuilding experience and homebuilding experience • Former
Slide 4: A Family of Regional Homebuilders
A Family of Regional Homebuilders A Family of Regional Homebuilders Market: Greater Puget Sound Area LTM Orders: 362 LTM Deliveries: 401 LTM HS Revenue: $202,122 LTM ASP: $504 Lots Owned or Controlled: 1,895 2018 Goal: 400 Annual Deliveries Markets: Los Angeles/Ventura, Inland Empire, San Diego, Las
Slide 5: 2016 Third Quarter Highlights
2016 Third Quarter Highlights
Slide 6: 2016 Third Quarter Highlights
2016 Third Quarter Highlights • Absorption rate of over 2.6 new home orders Metric 3Q 2016 3Q 2015 % Change per community per month Orders 932 996 -6% • New home deliveries down 10% to 1,019 with Deliveries 1,019 1,138 -10% an average sales price of $568K • Home sales revenue down 10% to $579MM ASP
Slide 7: 2016 Year-to-Date Highlights
2016 Year-to-Date Highlights • Strong absorption rate of 3.2 new home orders Metric YTD 2016 YTD 2015 % Change per community per month Orders 3,339 3,428 -3% • New home deliveries up 7% to 2,784 with an average sales price of $560K Deliveries 2,784 2,604 7% • Home sales revenue up 8% to $1,559MM ASP
Slide 8: Active Selling Communities and Absorption Rate
Active Selling Communities and Absorption Rate Active Selling Communities and Absorption Rate Communities by State As of and for the quarters ended September 30, 2015 and 2016 As of September 30, 2016 150 4.0 Washington Virginia 6% Arizona 123 3.5 15% 125 118 5% 3.0 2.7 100 2.6 2.5 Texas 75 2.0 24%
Slide 9: New Home Orders – Q3 2016 Results
New Home Orders – Q3 2016 Results Third Quarter - New Home Orders Orders by State For the quarters ended September 30, 2015 and 2016 For the quarter ended September 30, 2016 Washington 1,400 Virginia 5% Arizona 3% 14% 1,200 Texas 996 14% 1,000 932 Colorado 800 3% Decrease 6% YOY 600 Nevada 400 12% C
Slide 10: Backlog – Units and Dollar Value
Backlog – Units and Dollar Value Backlog – Units and Dollar Value Dollar Value by State As of September 30, 2015 and 2016 (dollars in thousands) As of September 30, 2016 2,000 Washington 1,856 $1,400,000 9% Arizona 1,800 1,711 Virginia 15% $1,200,000 5% 1,600 $1,109,867 2015 1,400 $950,171 2016 $1,0
Slide 11: New Home Deliveries – Q3 2016 Results
New Home Deliveries – Q3 2016 Results New Home Deliveries Deliveries by State As of and for the quarters ended September30, 2015 and 2016 For the quarter ended September 30, 2016 1,200 1,138 Washington 9% Arizona 1,019 Virginia 16% 1,000 3% Texas 800 12% 600 Colorado Decrease 10% YOY 3% 400 Nevada 2
Slide 12: Home Sales Revenue – Q3 2016 Results
Home Sales Revenue – Q3 2016 Results Home Sales Revenue Home Sales Revenue by State For the quarters ended September 30, 2015 and 2016 (dollars in thousands) For the quarter ended September 30, 2016 $700,000 $642,352 Washington 8% Arizona $600,000 $578,653 Virginia 12% 3% $500,000 Texas 11% $400,000
Slide 13: SG&A Expenses – Q3 2016 Results
SG&A Expenses– Q3 2016 Results Selling General and Administrative Expenses Income before Taxes, Net Income available to For the quarters ended September 30, 2015 and 2016 Common Stockholders and EPS (Diluted) For the quarters ended September 30, 2015 and 2016 $70,000 $90,000 $0.35 $63,002 $77,790 $8
Slide 14: Orders, Deliveries and Absorption Rate by Segment
Orders, Deliveries and Absorption Rate year over year comparisons for the Third Quarter 2016 by Segment (Includes breakout by state for Pardee Homes and TRI Pointe Homes brands)
Slide 15: Orders, Deliveries and Absorption Rate
Orders, Deliveries and Absorption Rate Orders, Deliveries and Absorption Rate For the quarters ended September 30, 2015 and 2016 For the quarters ended September 30, 2015 and 2016 180 4.0 120 117 4.0 165 160 150 3.5 3.5 100 140 131 134 87 90 2.9 3.0 3.0 120 2.5 80 2.5 2.5 2.5 2.3 100 2.0 60 2.0 80 4
Slide 16: Orders, Deliveries and Absorption Rate
Orders, Deliveries and Absorption Rate Orders, Deliveries and Absorption Rate For the quarters ended September 30, 2015 and 2016 For the quarters ended September 30, 2015 and 2016 180 2.0 140 4.0 163 160 3.5 120 115 1.7 109 140 130 1.5 125 1.5 97 3.0 121 100 120 2.7 81 2.5 100 80 2.4 1.0 2.0 80 60 D
Slide 17: California and Nevada Orders, Deliveries and Absorption Rate
California Nevada Orders, Deliveries and Absorption Rate Orders, Deliveries and Absorption Rate For the quarters ended September 30, 2015 and 2016 For the quarters ended September 30, 2015 and 2016 250 6.0 140 5.0 215 120 4.5 5.1 5.0 120 111 200 192 4.0 172 182 99 99 4.8 100 3.3 3.5 4.0 150 3.0 80 2
Slide 18: California and Colorado Orders, Deliveries and Absorption Rate
California Colorado Orders, Deliveries and Absorption Rate Orders, Deliveries and Absorption Rate For the quarters ended September 30, 2015 and 2016 For the quarters ended September 30, 2015 and 2016 250 247 4.0 60 3.0 230 51 208 3.5 200 50 2.5 200 3.0 3.0 2.9 2.1 40 2.0 2.5 34 150 1.9 31 30 2.0 30
Slide 19: 2016 Outlook
2016 Outlook
Slide 20: Fourth Quarter 2016 Update
Fourth Quarter 2016 Update • Anticipate opening 9 new communities and closing out of 7, resulting in 125 active selling communities as of December 31, 2016, up 20% from 104 as of December 31, 2015 • Anticipate delivering approximately 85% of the 1,711 homes in backlog as of September 30, 2016, resul
Slide 21: Land Supply, Orders by Month, Debt
Land Supply Orders by Month Debt
Slide 22: Significant Land Supply to Fuel Growth
Significant Land Supply to Fuel Growth Combined Lot Position As of September 30, 2016 Implied Years Market Owned Controlled Total Lots % Owned Inventory Dollars LTM Deliveries of Supply (1) California 16,865 587 17,452 97% $1,653,312 1,747 10.0 Colorado 475 684 1,159 41% $82,686 183 6.3 Washington,
Slide 23: New Home Orders – 2015 vs 2016 (through September)
New Home Orders – 2015 vs 2016 (through September) 500 477 455 457 450 425 415 409 418 410 2015 400 371 2016 367 356 355 346 350 324 322 318 306 300 280 274 250 227 208 200 150 100 50 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2016 - 2.98 3.57 3.45 3.89 3.60 3.06 2.41 2.59 2.84 2015 - 2.96 3.
Slide 24: Selected Balance Sheet Metrics
Selected Balance Sheet Metrics Selected Balance Sheet Metrics $ in thousands 9/30/2016 12/31/2015 Cash and cash equivalents $ 128,715 $ 214,485 • During the third quarter, the Real estate inventories $ 2,969,148 $ 2,519,273 Company borrowed $100 million Total Debt $ 1,384,482 $ 1,170,505 under its $
Slide 25: Supplemental Data and Reconciliation
Supplemental Data and Reconciliation
Slide 26: 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 27: Reconciliation of Non-GAAP Financial Measures (unaudited)
Reconciliation of Non-GAAP Financial Measures (unaudited) Nine Months Ended September 30, 2016 % 2015 % (dollars in thousands) Home sales revenue $ 1,558,633 100.0 % $ 1,443,855 100.0 % Cost of home sales 1,219,560 78.2 % 1,149,191 79.6 % Homebuilding gross margin 339,073 21.8 % 294,664 20.4 % Add:
Slide 28: 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-capital. We believe that the ratio of net debt- to-capital is a relevant financial measure for management and investors to understand th