D.r. Horton, Inc. · NYSE:DHI
D.r. Horton — Q1 2024 Earnings Presentation
31 slides from D.r. Horton's earnings presentation, Jan 23, 2024
Slide 1: Investor Presentation Q1 2024
Investor Presentation Q1 2024
Slide 2: America's #1 Homebuilder: 118 Markets, 33 States
118 Markets 33 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: D.R. Horton, Inc.
D.R. Horton, Inc. Traded on NYSE as DHI $35.9 billion $6.3 billion 21.8% & 29.0% Consolidated revenues Consolidated pre-tax income ROE & ROI (HB), respectively* $23.2 billion $69.70 18.6% Stockholders’ equity Book value per common share Consolidated leverage* As of or for the trailing twelve months
Slide 5: DHI Growth, Consolidation And Market Share
DHI Growth, Consolidation And Market Share 2023 Closings: 1,400 14% 90,777 90,777 Homes Closed during trailing twelve months ended 12/31/2023 1,200 12% 1,000 10% 800 8% 2006 Closings: 600 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
Slide 6: Market Share Dominance
Market Share Dominance D.R. Horton is the largest builder in 3 of the top 5 U.S. housing markets & in 51 of the 118 markets in which we operate Top 5 U.S. Housing Markets D.R. Horton Markets 25% 120 110 118 114 20% 100 107 90 80 15% 70 60 10% 50 51 40 30 5% 20 10 0% 0 DFW Houston Austin San Antonio
Slide 7: Management Tenure And Experience
Management Tenure And Experience Executive Team ~27 years Region Presidents & Vice Presidents ~22 years Division Presidents & City Managers ~14 years Average employee tenure
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 70% of homes closed <$400k 23% $0 - $300k 27% $301k - $350k 20% $351k - $400k 19% $401k - 500k 11% >$500K 0% 5% 10% 15% 20% 25% 30% Represents price points of homes closed for the trailing twelv
Slide 9: Return On Equity (ROE)
Return On Equity (ROE) Solid ROE while maintaining conservative leverage Consolidated ROE Leverage 40% 40% 35% 35% 34.5% 30% 31.6% 30% 31.5% 25% 25% 20% 22.7% 21.8% 20% 15% 15% 10% 10% 5% 5% 0% 0% FY 2021 FY 2022 TTM 12/31/22 FY 2023 TTM 12/31/23 ROE Leverage ROE is calculated as net income divided
Slide 10: Emphasis On Homebuilding Return On Inventory (ROI)
Emphasis On Homebuilding Return On Inventory (ROI) 45% 40% 42.8% 39.5% 35% 37.9% 30% 29.7% 29.0% 25% 20% 15% 10% 5% 0% FY 2021 FY 2022 TTM 12/31/22 FY 2023 TTM 12/31/23 Homebuilding ROI is calculated as homebuilding pre‐tax income for the year divided by average homebuilding inventory. Average homeb
Slide 11: Return On Assets (ROA)
Return On Assets (ROA) 25% 20% 21.7% 19.8% 20.1% 15% 15.1% 14.8% 10% 5% 0% FY 2021 FY 2022 TTM 12/31/22 FY 2023 TTM 12/31/23 ROA is calculated as net income divided by average consolidated assets. Average consolidated assets in the ROA calculation is the sum of ending consolidated asset balances for
Slide 12: Book Value (BV) And Earnings Per Share (EPS)
Book Value (BV) And Earnings Per Share (EPS) Strong EPS driving consistent growth in book value per share Fiscal Year Ended Three Months Ended $70 $70 $67.78 $69.70 $60 $60 $56.39 $58.71 $50 $50 $40 $41.81 $40 $44.25 $30 $32.53 $30 $34.33 $20 $20 $16.51 $10 $13.82 $11.41 $10 $2.14 $3.17 $2.76 $2.82
Slide 13: Cash Flow At Work
Cash Flow At Work Homebuilding operations generated $9.6 billion of cash flow over the past five years HB Cash Flow* $3,500 $3,000 ~5-Year Capital Allocation** $3,078 Cash Flow from $9.6B $2,500 Homebuilding Operations $2,000 Shareholder Return $5.4B $1,917 through Dividends and $1,889 Share Repurch
Slide 14: Capital And Cash Flow Priorities
Capital And Cash Flow Priorities • Balanced, disciplined, flexible and opportunistic; focused on enhancing long-term value • Strong balance sheet, liquidity and low leverage provide significant financial flexibility • Invest in homebuilding business, including acquisitions • Grow multi-family and si
Slide 15: Homebuilding Operational Focus
Homebuilding Operational Focus • Maximize returns and generate consistent cash flow by managing sales pace and pricing in each community to provide value to homebuyers • Manage land, lot and home inventory efficiently to meet demand and gain market share • Minimum investment underwriting thresholds
Slide 16: Rental Operations
Rental Operations Develop, construct, lease and sell single-family and multi-family residential properties Generated $445.1 million of pre-tax income on $2.5 billion of revenues in the past twelve months Single-Family Rental Multi-Family Rental 1Q24 1Q23 TTM 1Q24 1Q23 TTM 12/31/23 12/31/23 Revenues
Slide 17: Forestar
Forestar • DHI owns 63% of Forestar, a publicly traded residential lot developer (NYSE: FOR) • Operations in 57 markets and 23 states • Uniquely positioned to aggregate significant market share of lot sales to homebuilders • Supports DHI’s strategy of controlling land and lots through purchase contr
Slide 18: Expectations
Expectations Although volatility in mortgage rates and changes in economic conditions could significantly impact the business, the Company’s expectations for Q2 and FY 2024 are as follows: Q2 FY 2024 • Consolidated revenues in a range of $8.1 billion to $8.3 billion • Homes closed between 20,000 hom
Slide 19: First Quarter Data
First Quarter Data
Slide 20: Q1 FY 2024 Highlights
Q1 FY 2024 Highlights • Net income attributable to D.R. Horton of $947.4 million or $2.82 per diluted share • Consolidated pre-tax income of $1.2 billion, with a pre-tax profit margin of 16.1% • Consolidated revenues increased 6% to $7.7 billion • Home closed increased 12% to 19,340 homes and 8% in
Slide 21: Homes Closed And Revenues
Homes Closed And Revenues Home sales revenues of $7.3 billion on 19,340 homes closed by homebuilding operations in Q1 FY24 Homes Closed Home Sales Revenues # of Homes Revenues 25,000 $10,000 20,000 $8,000 15,000 $6,000 10,000 $4,000 5,000 $2,000 0 $- 1Q FY22 1Q FY23 1Q FY24 1Q FY22 1Q FY23 1Q FY24 $
Slide 22: Income Statement
Income Statement $ in millions except per share data
Slide 23: 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% 25.1% 23.9% 23.3% 23.5% 22.9% 20% 21.6% 16% 12% 8% 4% 0% FY 2021 FY 2022 1Q23 2Q23 3Q23 4Q23 FY 2023 1Q24 Shown as a % of the Company’s homebuilding segment’s home
Slide 24: Homebuilding SG&A
Homebuilding SG&A Controlling SG&A while ensuring that our platform adequately supports future growth Fiscal Year First Fiscal Quarter HB Rev $ SG&A % HB Rev $ SG&A % $32,000 12% $14,000 12% $28,000 11% $12,000 11% $24,000 10% $10,000 10% $20,000 9% $8,000 9% $16,000 8% $6,000 8% $12,000 8.3% 7% $4,
Slide 25: Consolidated Pre-Tax Income
Consolidated Pre-Tax Income Q1 FY24 consolidated pre-tax income was $1.2 billion, with a profit margin of 16.1% Fiscal Year First Fiscal Quarter PTI $ PTI $ $8,000 22.8% $2,400 $7,000 $7,629.7 $2,100 17.8% $6,000 $1,800 $6,314.7 $5,000 $1,500 17.5% 16.1% $4,000 $1,200 $1,267.2 $1,247.5 $3,000 $900 $
Slide 26: Balance Sheet
Balance Sheet $ in millions except per share metrics Homebuilding cash and cash equivalents presented above includes $6.0 million, $6.5 million and $7.4 million of restricted cash for the periods ended 12/31/2023, 9/30/2023 and 12/31/2022, respectively.
Slide 27: Homes In Inventory
Homes In Inventory Managing housing inventory to meet demand and aggregate market share 70,000 60,000 50,000 47,800 46,400 43,200 42,000 42,600 40,000 30,000 20,000 10,000 0 9/30/21 9/30/22 12/31/22 9/30/23 12/31/23 Sold Specs Homes in inventory excluding model homes
Slide 28: Homebuilding Land And Lot Position
Homebuilding Land And Lot Position Strong, flexible land and lot pipeline 24% owned / 76% controlled at 12/31/23 700,000 607,200 600,000 573,200 568,400 551,000 530,300 500,000 400,000 462,200 442,100 414,600 427,300 402,500 300,000 200,000 100,000 127,800 131,100 136,400 141,100 145,000 0 9/30/21 9
Slide 29: Appendix
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Slide 30: Geographic Diversification
Geographic Diversification 10% 118 Markets | 33 States 8% 27% Northwest Homebuilding 14% Colorado, Oregon, Utah and Washington Revenue 24% 17% Southwest Arizona, California, Hawaii, Nevada and New Mexico South Central Arkansas, Oklahoma and Texas Southeast South Central East Southwest Northwest Nort
Slide 31: Homebuilding Public Debt Maturities By Year
Homebuilding Public Debt Maturities By Year No senior note maturities until fiscal 2025 $700 $600 $600 $500 $500 $500 $500 $400 $300 $200 2.50% 2.60% 1.30% 1.40% $100 $0 FY 24 FY 25 FY 26 FY 27 FY 28 $ in millions