D.r. Horton, Inc. · NYSE:DHI
D.r. Horton — Q2 2024 Earnings Presentation
31 slides from D.r. Horton's earnings presentation, Apr 18, 2024
Slide 1: Investor Presentation Q2 2024
Investor Presentation Q2 2024
Slide 2: 119 Markets, 33 States: America's #1 Homebuilder
119 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 $37.1 billion $6.6 billion 22.2% & 29.9% Consolidated revenues Consolidated pre-tax income ROE & ROI (HB), respectively* $23.8 billion $72.13 20.0% 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 94,049 Homes Closed during trailing twelve months ended 3/31/2024 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 52 of the 118 markets in which we operated at September 30, 2023 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 52 40 30 5% 20 10 0% 0 DFW Hous
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 26% $301k - $350k 21% $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% 25% 27.2% 25% 20% 22.7% 22.2% 20% 15% 15% 10% 10% 5% 5% 0% 0% FY 2021 FY 2022 TTM 3/31/23 FY 2023 TTM 3/31/24 ROE Leverage ROE is calculated as net income divided by
Slide 10: Emphasis On Homebuilding Return On Inventory (ROI)
Emphasis On Homebuilding Return On Inventory (ROI) 45% 40% 42.8% 35% 37.9% 35.1% 30% 29.7% 29.9% 25% 20% 15% 10% 5% 0% FY 2021 FY 2022 TTM 3/31/23 FY 2023 TTM 3/31/24 Homebuilding ROI is calculated as homebuilding pre‐tax income for the year divided by average homebuilding inventory. Average homebui
Slide 11: Return On Assets (ROA)
Return On Assets (ROA) 25% 20% 21.7% 19.8% 17.6% 15% 15.1% 15.1% 10% 5% 0% FY 2021 FY 2022 TTM 3/31/23 FY 2023 TTM 3/31/24 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 t
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 Six Months Ended $90 $90 $80 $80 $70 $70 $72.13 $67.78 $60 $60 $60.73 $56.39 $50 $50 $47.66 $40 $41.81 $40 $30 $35.96 $32.53 $30 $20 $20 $16.51 $10 $13.82 $10 $7.20 $5.50 $6.34
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 • Focused on generating consistent and increasing cash flows from homebuilding operations • Balanced, disciplined, flexible and opportunistic capital allocation to enhance long-term value • Invest to grow homebuilding business and multi-family and single-family renta
Slide 15: Homebuilding Operational Focus
Homebuilding Operational Focus • Maximize returns and generate consistent cash flow by managing sales pace and pricing in each community and 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 $443.9 million of pre-tax income on $2.6 billion of revenues in the past twelve months Single-Family Rental Multi-Family Rental 2Q24 2Q23 TTM 2Q24 2Q23 TTM 3/31/24 3/31/24 Revenues $3
Slide 17: Forestar
Forestar • DHI owns 62% 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 Q3 and FY 2024 are as follows: Q3 FY 2024 • Consolidated revenues in a range of $9.5 billion to $9.7 billion • Homes closed between 23,500 hom
Slide 19: Second Quarter Data
Second Quarter Data
Slide 20: Q2 FY 2024 Highlights
Q2 FY 2024 Highlights • Net income increased 24% to $1.2 billion or $3.52 per diluted share • Consolidated pre-tax income increased 23% to $1.5 billion, with a pre-tax profit margin of 16.8% • Consolidated revenues increased 14% to $9.1 billion • Homes closed increased 15% to 22,548 homes and 14% in
Slide 21: Homes Closed And Revenues
Homes Closed And Revenues Home sales revenues of $8.5 billion on 22,548 homes closed by homebuilding operations in Q2 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 $- 2Q FY22 2Q FY23 2Q FY24 2Q FY22 2Q FY23 2Q 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% 23.9% 23.5% 22.9% 23.2% 20% 21.6% 16% 12% 8% 4% 0% FY 2021 FY 2022 1Q23 2Q23 FY 2023 1Q24 2Q24 Shown as a % of the Company’s homebuilding segment’s home sales reve
Slide 24: Homebuilding SG&A
Homebuilding SG&A Controlling SG&A while ensuring that our platform adequately supports future growth Fiscal YTD 3/31 Second 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 7.5% 7
Slide 25: Consolidated Pre-Tax Income
Consolidated Pre-Tax Income Q2 FY24 consolidated pre-tax income was $1.5 billion, with a profit margin of 16.8% Fiscal YTD 3/31 Second Fiscal Quarter PTI $ PTI $ $4,800 $2,400 $4,200 $2,100 $3,600 $1,800 16.8% $3,000 16.5% $1,500 16.5% 15.6% $1,528.5 $2,400 $2,776.0 $2,512.5 $1,200 $1,245.3 $1,800 $
Slide 26: Balance Sheet
Balance Sheet $ in millions except per share metrics Homebuilding cash and cash equivalents presented above includes $6.7 million, $6.5 million and $8.5 million of restricted cash for the periods ended 3/31/2024, 9/30/2023 and 3/31/2023, 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 43,600 45,000 42,000 40,000 30,000 20,000 10,000 0 9/30/21 9/30/22 3/31/23 9/30/23 3/31/24 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 23% owned / 77% controlled at 3/31/24 700,000 617,200 600,000 573,200 568,400 530,300 547,000 500,000 400,000 473,300 442,100 410,700 427,300 402,500 300,000 200,000 100,000 127,800 131,100 136,300 141,100 143,900 0 9/30/21 9/
Slide 29: Appendix
Appendix
Slide 30: Geographic Diversification
Geographic Diversification 10% 119 Markets | 33 States 8% 27% Northwest Homebuilding 15% Colorado, Oregon, Utah and Washington Revenue 23% 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 Next senior note maturity in Q1 FY25 $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