Slide 1: Second Quarter 2010 Financial Results
1 August 3, 2010 Second Quarter 2010 Financial Results August 4, 2010
Slide 2: Forward Looking Statements
2 Forward Looking Statements This presentation contains "forward-looking statements" within the meaning of the federal securities laws. These statements reflect management's current views with respect to future events and are subject to risk and uncertainties. We note that a variety of factors and u
Slide 3: Second Quarter 2010 Results
Second Quarter 2010 Results 3 ($ in Millions, except per share data) 2nd Qtr 2010 2nd Qtr 2009 1st Qtr 2010 Net Income (Loss) ($3.3) $50.9 ($3.0) Earnings (Loss) Per Share ($0.09) $1.41 ($0.08) 2nd Qtr 2010 weighted average basic shares outstanding were 36.2 million 2nd Qtr 2009 results include a ga
Slide 4: Segment Earnings
Segment Earnings 4 ($ in Millions) 2nd Qtr 2010 2nd Qtr 2009 1st Qtr 2010 Real Estate $2.4 $5.0 $0.3 Mineral Resources 4.3 6.4 6.2 Fiber Resources 1.1 3.3 1.4 Total $ 7.8 $14.7 $ 7.9 2nd Qtr 2010 real estate segment earnings include non-cash impairment charge of approximately $0.9 million related to
Slide 5: Results and Key Performance Indicators
5 August 3, 2010 2nd Qtr 2010 Results and Key Performance Indicators 5 Strategy and Initiative Execution Have Forestar Well Positioned
Slide 6: Housing Market Conditions - Q2 2010
Housing Market Conditions - Q2 2010 6 Issue Metric Comment Housing Affordability 158 1 Prices return to 2003 levels 30-Yr Fixed Rate Mortg. 4.5% Near historic lows New Home Inventory 210,000 units Lowest level since September 1968 Unemployment 9.5% More problematic in troubled real estate markets Co
Slide 7: Texas Employment & Housing Fundamentals
Texas Employment & Housing Fundamentals 7 Texas Market Job growth beginning 2nd Qtr. 2010 June 09 - June 10, Texas has created >110,000 new jobs Solid market fundamentals: 7.0 months of supply - New Home 7.6 months of supply - Existing Home Foreclosure Inv. - 1.5% of outstanding mortgages Positive J
Slide 8: Real Estate Segment KPI's
8 Real Estate Segment KPI's 2nd Qtr 2010 2nd Qtr 2009 1st Qtr 2010 Residential Lot Sales * Lots Sold 235 165 195 Average Price / Lot $50,300 $59,200 $49,500 Gross Profit / Lot $15,500 $18,100 $14,300 Commercial Tract Sales * Acres Sold 14.6 -- 1.6 Average Price / Acre $58,800 -- $172,800 Land Sales
Slide 9: Real Estate Pipeline - Q2 2010
Real Estate Pipeline - Q2 2010 * In addition, Forestar owns a 58% interest in a venture which controls over 16,000 acres of undeveloped land in Georgia 9
Slide 10: Entitlement Activity - Q2 2010
10 Entitlement Activity - Q2 2010 Entitlements 1,722 planned residential lots 72 planned commercial acres Good Location Joint-venture project located in the Woodlands, TX market Houston, TX MSA Solid market fundamentals: 6.6 months of supply - New Home 7.3 months of supply - Existing Home Foreclosur
Slide 11: Fiber Resources Segment KPI's
11 Fiber Resources Segment KPI's 2nd Qtr 2010 2nd Qtr 2009 1st Qtr 2010 Fiber Sales Pulpwood Tons Sold 95,600 244,100 83,100 Average Pulpwood Price / Ton $10.89 $7.85 $10.92 Sawtimber Tons Sold 23,800 136,100 29,600 Average Sawtimber Price / Ton $20.36 $18.28 $20.14 Total Tons Sold 119,400 380,200 1
Slide 12: Oil & Gas Market Conditions
Oil & Gas Market Conditions 12 Near-Term Fundamentals: Oil prices remain firm in anticipation of global demand (China & India) Natural gas prices pressured by elevated inventories and supply E&P companies drilling to hold leases and prove reserves vs. increasing lease acreage Gulf issues expected to
Slide 13: Mineral Resources Segment KPI's
13 Mineral Resources Segment KPI's 2nd Qtr 2010 2nd Qtr 2009 1st Qtr 2010 Leasing Activity Net Acres Leased - 8,200 2,130 Average Bonus / Acre - $357 $1,495 Royalties* Natural Gas Production (MMcf) 689.5 309.8 373.2 Average Price / Mcf $4.60 $3.89 $4.30 Oil Production (Barrels) 30,500 25,900 29,400
Slide 14: East Texas E&P Industry Activity - Q2 2010
East Texas E&P Industry Activity - Q2 2010 14 Note: Wells owned by third-party lessee / operator 42 rigs in the area 38 rigs drilling Bossier - Haynesville wells 35 wells drilled 40 wells waiting on completion at June 2010 Bossier - Haynesville Activity in East Texas* Acres Leased Available for Leas
Slide 15: Right Strategy, Experienced Management Team, Strong Balance Sheet
15 Right Strategy Experienced Management Team Strong Balance Sheet Strategy, Portfolio and Initiative Execution Have Forestar Well Positioned
Slide 16: August 3, 2010
16 August 3, 2010