Beazer Homes Usa, Inc. · NYSE:BZH
Beazer Homes Usa — Q1 2025 Earnings Presentation
30 slides from Beazer Homes Usa's earnings presentation, Jan 30, 2025
Slide 1: Beazer Homes USA, Inc. Q1 2025 Earnings Presentation
Beazer Homes USA, Inc. Q1 2025 Earnings Presentation 1
Slide 2: Disclaimers
Disclaimers This presentation contains forward-looking statements about Beazer Homes USA, Inc. (“Beazer Homes”) that only speak as of this date. Beazer Homes disclaims any obligation to update these statements. These forward-looking statements represent our good-faith estimates, expectations or beli
Slide 3: Introduction
Introduction Allan P. Merrill David I. Goldberg Chairman & Chief Executive Officer Sr. Vice President & Chief Financial Officer 3
Slide 4: Q1 FY25 Highlights
Q1 FY25 Highlights Community Count Expansion Lot Count Growth Balance Sheet Efficiency Revolver Upsized(a) Zero Energy Ready Adoption (a) Subsequent event that occurred in January 2025 4
Slide 5: Current Operating Environment
Current Operating Environment Affordability Remains a Concern First Quarter Drivers Monthly Mortgage Payment as a % of Income 34% 32% • Elevated and volatile rates led to 30% softer sales pace and higher incentives 28% 26% 24% 22% • Texas and Florida softer than 20% other markets 18% • Higher invent
Slide 6: Improvement Initiatives and FY25 Outlook
Improvement Initiatives and FY25 Outlook Improvement Initiatives Expected Results Activating more than 60 new Stronger Sales Pace communities before year-end Making Mortgage Financing For Higher Mix of TBB Sales To-Be-Builts More Compelling Improving the profitability of Better Spec Margins our spec
Slide 7: Multi-Year Goals ("MYG")
Multi-Year Goals (“MYG”) > 200 Communities Fiscal Year-end 2026 < 30% Net Debt to Net Capitalization Fiscal Year-end 2026 100% Zero Energy Ready Starts Calendar Year-end 2025 7
Slide 8: MYG: Expanding Community Count
MYG: Expanding Community Count > 200 Active Communities FYE26 200 40 ~ 180 Active 180 Communities FYE25 35 Total Lots Controlled (thousands) Active Community Count - Period-End 163 160 30 140 25 134 136 120 119 20 116 100 15 18k 22k 24k 26k 28k 80 10 Q1 FY21 Q1 FY22 Q1 FY23 Q1 FY24 Q1 FY25 FYE25 FYE
Slide 9: MYG: Delevering Balance Sheet
MYG: Delevering Balance Sheet 70% 60% 59.4% 54.3% 50% 47.3% 44.5% 43.7% 40% Mid-30’s by FYE25 Delever through profitability, 30% cash generation, & balance sheet management < 30% Net Debt / Net Cap 20% Q1 FY21 Q1 FY22 Q1 FY23 Q1 FY24 Q1 FY25 FYE25 FYE26 Net Debt to Net Capitalization See “Non-GAAP N
Slide 10: MYG: Delivering Zero Energy Ready
MYG: Delivering Zero Energy Ready 100% ZER Starts by CYE25 100% 98% 92% 80% 67% 60% Beazer is the only public builder to commit 100% of starts to ZER 40% 20% 20% 3% 0% 1st Half 2nd Half 1st Half 2nd Half Q1 FY25 CYE25 FY23 FY24 10
Slide 11: Q1 Results: Balanced Growth
Q3 Q1Results Results Balanced Growth Results Q1 FY25 YoY Change New Home Orders 932 13.2% Sales Pace 1.9 (3.8%) Community Count, Avg 161 17.8% Homebuilding Revenue ($mm) $460.4 20.9% Closings 907 22.1% Average Selling Price ($k) $507.6 (1.0)% HB Gross Margin %(a) 18.2% (470 bps) SG&A as % of Total R
Slide 12: 2nd Quarter Expectations
2nd Quarter Expectations Metric Expectations New Home Orders(a) Up ~10% Active Community Count, Avg(a) Up ~15% Active Community Count, Ending ~160 Closings ~1,050 Average Selling Price ~$515k Adjusted HB Gross Margin %(b) Up Slightly SG&A as % of Total Revenue < 13% Adjusted EBITDA > $30MM Interest
Slide 13: Outlook for Fiscal Year 2025
Outlook for Fiscal Year 2025 Community Count Growth Macro Assessment Ranges Low High Average Community Count +12.5% +15.0% Sales Pace ~2.50 ~3.00 Gross Margin(a) ~19.5% ~20.5% Estimates ASP Approaching $530k SG&A ~11% Significant Revenue Growth Leading to Double-Digit Return on Capital Employed (a)
Slide 14: Growing Lot Position Through Options
Growing Lot Position Through Options 60% 40 59% 54% 53% 49% Ending Active Lot Balance (thousands) Total Active Lots Controlled by Option 45% 28 30 42% 26 24 22 29% 30% 19 18 17 20 14 11 13 5 8 15% 10 13 12 11 11 11 12 0% - Q1 Q1 Q1 Q1 Q1 Q1 FY20 FY21 FY22 FY23 FY24 FY25 Active Owned Lots (000s) Opti
Slide 15: Liquidity and Capitalization
Liquidity and Capitalization $ in millions Net Debt / Net Cap(a) 44.5% $500 Total liquidity of Net Debt / Adj. EBITDA 4.3x ~$335 million increased to ~$400 million with Revolver $400 $65 expansion(b) $300 $255 $200 $357 $350 $250 $100 $39 $80 $77 $- Unrestricted Cash Restricted Cash - LC/Escrow Undr
Slide 16: Commitment to Double-Digit ROCE/ROE
Commitment to Double-Digit ROCE/ROE $50.00 $40.07 $40.00 $36.18 $31.58 Book Value per Share $30.00 $24.58 $20.14 $20.00 $10.00 $- Q1 FY21 Q1 FY22 Q1 FY23 Q1 FY24 Q1 FY25 Homebuilding Assets DTA Quarterly diluted weighted-average shares outstanding at period-end used for all per share calculations Ba
Slide 17: Wrap-Up
Wrap-Up FY25 Outlook • Growing Community Count • Significant Revenue Growth • Double-Digit Returns(a) Progress Toward Multi-Year Goals • > 200 Communities - FYE26 • < 30% Net Debt to Net Capitalization - FYE26 • 100% Zero Energy Ready Starts - CYE25 (a)Return on Capital Employed is defined as Adjust
Slide 18: Appendix
AK BEAZER tomes Appendix
Slide 19: Zero Energy Ready Homes
Zero Energy Ready Homes A DOE Zero Energy Ready Home® is a high-performance home that is so energy efficient that a renewable energy system could offset most or all the home's annual energy use. Each DOE Zero Energy Ready Home meets rigorous efficiency and performance criteria. • Homeowner Benefits
Slide 20: SG&A Leverage
SG&A Leverage SG&A Per Closing SG&A Leverage LTM Homebuilding % of Total Revenue $ in thousands $70 15.0% $61.6 $62.1 $59.9 $60.0 $60 12.5% 11.8% 11.8% 11.5% 11.2% 11.0% $50 10.0% $40 7.5% 14.3% 14.0% $30 12.7% 12.3% 11.8% 5.0% $20 2.5% $10 $- 0.0% Q2 Q3 Q4 Q1 Q1 Q1 Q1 Q1 Q1 FY24 FY25 FY21 FY22 FY23
Slide 21: Cancellation Rates
Cancellation Rates 40% 37% 35% 30% 25% 20% 19% 16% 15% 14% 12% 12% 12% 11% 10% 8% 5% 5% 0% Q1 FY21 Q1 FY22 Q1 FY23 Q1 FY24 Q1 FY25 Cancellation Rate Cancellation Rate (% of Backlog)(a) (a) Cancellation Rate as a % of Backlog is calculated using the quarter's beginning backlog units 21
Slide 22: Specs per Community
Spec Homes 1,500 20 18 1,250 1,219 16 894 982 14 1,000 789 Specs per Community 840 12 Spec Homes 744 701 750 10 711 598 8 489 7.2 7.5 7.1 500 6.4 6 4.5 4 250 325 2 139 193 109 - 33 - Q1 FY21 Q1 FY22 Q1 FY23 Q1 FY24 Q1 FY25 Completed Under Construction Per Community Note: Spec count as of each quarte
Slide 23: Segment ASP & Margins
Segment ASP & Margins ($ in thousands) Q1 FY24 Q1 FY25 Change in Change in Q1 FY24 Q1 FY25 Change in ASP ASP ASP ($) ASP (%) Closings Closings Mix West $516.3 $502.3 ($14.0) (2.7%) 61.1% 64.1% 3.0% East $527.6 $540.1 $12.5 2.4% 18.3% 22.2% 3.9% Southeast $488.6 $480.0 ($8.6) (1.8%) 20.6% 13.8% (6.8%
Slide 24: Q1 Results
Q1 Results $ in millions (except ASP) Q1 FY24 Q1 FY25 ∆(d) Profitability Total Revenue $ 386.8 $ 469.0 21.3% Adjusted EBITDA(a) $ 38.0 $ 23.0 ($15.0) Net Income - Cont. Ops. $ 21.7 $ 3.1 ($18.6) Unit Activity New Home Orders 823 932 13.2% Closings 743 907 22.1% Average Selling Price ($k) $ 512.7 $ 5
Slide 25: Backlog Detail
Backlog Detail Q1 FY24 Q1 FY25 Quarter Ending Backlog (units) 1,791 1,507 Quarter Ending Backlog ($ in millions) $ 932.8 $ 816.0 ASP in Backlog ($ in thousands) $ 520.8 $ 541.5 Quarter Beg. Backlog 1,711 1,482 Scheduled to Close in Future Qtrs. (964) (694) Backlog Scheduled to Close in the Qtr. 747
Slide 26: Non-GAAP Homebuilding Gross Margin Reconciliation
Non-GAAP Homebuilding Gross Margin Reconciliation Three Months Ended December 31, 2024 HB Gross HB Gross HB Gross Profit HB Gross Margin Profit Margin excluding excluding Impairments & excluding excluding Interest I&A and I&A and HB Gross HB Gross Abandonments I&A I&A Amortized to Interest (Non- Int
Slide 27: Non-GAAP Adjusted EBITDA Reconciliation
Non-GAAP Adjusted EBITDA Reconciliation Three Months Ended December 31, LTM Ended December 31, ($ in thousands) 2023 2024 24 vs 23 2023 2024 24 vs 23 Net income (GAAP) $ 21,728 $ 3,130 $ (18,598) $ 156,008 $ 121,577 $ (34,431) Expense from income taxes 1,181 36 (1,145) 20,984 17,765 (3,219) Interest
Slide 28: Non-GAAP Net Debt to Net Capitalization Reconciliation
Non-GAAP Net Debt to Net Capitalization Reconciliation Three Months Ended December 31, 2023 2024 ($ in thousands) Total debt (GAAP) $ 974,644 $ 1,071,290 Stockholders' equity (GAAP) 1,121,011 1,234,048 Total capitalization (GAAP) $ 2,095,655 $ 2,305,338 Total debt to total capitalization ratio (GAAP
Slide 29: Beazer Tax Benefits
Beazer Tax Benefits FY25 - FY26 FY27 - FY33(a) Building industry-leading, energy efficient homes provides tax benefits: Energy Prior tax code – $2K Home Efficiency Current tax code (Energy Star) – $2.5K SFD Credits Current tax code (DOE Zero Energy Ready) – $5K SFD > 11% & < 17% ~ 17% GAAP Taxes (Cu
Slide 30: Deferred Tax Assets - Summary
Deferred Tax Assets - Summary ($ in millions) December 31, 2023 December 31, 2024 Deferred Tax Assets $ 171.4 $ 164.0 Valuation Allowance $ (30.4) $ (27.6) Deferred Tax Liabilities $ (5.4) $ (5.3) Net Deferred Tax Assets $ 135.6 $ 131.1 As of December 31, 2024, our conclusions on whether we are more