Tri Pointe Homes, Inc. · NYSE:TPH
Tri Pointe Homes — Q2 2024 Earnings Presentation
25 slides from Tri Pointe Homes's earnings presentation, Jul 25, 2024
Slide 1: 2024 Second Quarter Results
2024 Second Quarter Results July 25, 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements 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, but are not limite
Slide 3: Management Team
Management Team Thomas Mitchell Douglas Bauer Glenn Keeler President & COO Chief Executive Officer Chief Financial Officer • Over 30 years of real estate • Over 30 years of real estate and • Over 10 years of real estate and homebuilding experience homebuilding experience and homebuilding experience
Slide 4: A diversified portfolio of markets
A diversified portfolio of markets West Segment Markets: San Francisco Bay Area, Inland Empire, Orange County-Los Angeles, Sacramento, San Diego, Phoenix, Las Vegas, Seattle Metro Area LTM Orders: 3,406 LTM Deliveries: 3,542 LTM HS Revenue: $2,626,857 LTM ASP: $742 Lots Owned or Controlled: 15,050 E
Slide 5: 2024 Second Quarter Highlights
2024 Second Quarter Highlights 5
Slide 6: 2024 Second Quarter Highlights
2024 Second Quarter Highlights • Net new home orders of 1,651 on absorption rate of 3.6 net new home orders per community per month Metric 2Q24 2Q23 % Change • New home deliveries up 45% to 1,700 with an average sales price of Orders 1,651 1,912 -14% $666,000 • Ending active selling communities up 6
Slide 7: Second Quarter Results
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Slide 8: Active Selling Communities and Absorption Rate
Active Selling Communities and Absorption Rate Q2 2024 Results Active Selling Communities and Absorption Rate Active Selling Communities by Geography As of and for the quarters ended June 30, 2023 and 2024 As of June 30, 2024 175 5.0 Washington 4.5 D.C. Area(2) 153 4.5 150 145 5% Washington 4.0 3% 3
Slide 9: Net New Home Orders – Q2 2024 Results
Net New Home Orders – Q2 2024 Results Net New Home Orders Net New Home Orders by Geography For the quarters ended June 30, 2023 and 2024 For the quarter ended June 30, 2024 2,500 Washington D.C. Area(2) Washington 6% 2,000 1,912 5% Carolinas(1) 8% 1,651 Colorado 1,500 1% Decrease 14% YOY California
Slide 10: Backlog – Units and Dollar Value – Q2 2024 Results
Backlog – Units and Dollar Value – Q2 2024 Results Backlog – Units and Dollar Value Backlog Dollar Value by Geography As of June 30, 2023 and 2024 (dollars in thousands) As of June 30, 2024 3,000 2023 2024 $2,500,000 Washington 2,765 2,692 D.C. Area(2) Washington $1,999,852 7% 11% 2,500 $1,922,895 $
Slide 11: New Home Deliveries – Q2 2024 Results
New Home Deliveries – Q2 2024 Results New Home Deliveries New Home Deliveries by Geography For the quarters ended June 30, 2023 and 2024 For the quarter ended June 30, 2024 Washington 1,800 1,700 Washington D.C. Area(2) 1,600 4% 4% Carolinas(1) 12% 1,400 1,200 1,173 Colorado California 3% 1,000 34%
Slide 12: Home Sales Revenue – Q2 2024 Results
Home Sales Revenue – Q2 2024 Results Home Sales Revenue Home Sales Revenue by Geography For the quarters ended June 30, 2023 and 2024 (dollars in thousands) For the quarter ended June 30, 2024 $1,200,000 $1,133,008 Washington D.C. Area(2) $1,000,000 Washington 5% 6% Carolinas(1) $819,077 9% $800,000
Slide 13: SG&A Expenses, Income Before Taxes, Net Income and EPS (Diluted)
SG&A Expenses, Income Before Taxes, Net Income and EPS (Diluted) – Q2 2024 Results Selling, General and Administrative Expenses Income Before Taxes, Net Income Available to For the quarters ended June 30, 2023 and 2024 (dollars in thousands) Common Stockholders and EPS (Diluted) For the quarters end
Slide 14: Land Supply, Orders by Month, Return on Equity and Risk Profile
Land Supply Orders by Month Return on Equity and Risk Profile Book Value Per Share Debt 14
Slide 15: Significant Land Supply to Fuel Growth
Significant Land Supply to Fuel Growth Combined Lot Position As of June 30, 2024 Note: Dollars in thousands Implied Years of Geography Owned Controlled(3) Total Lots % Owned Inventory Dollars LTM Deliveries Supply(4) Arizona 792 1,331 2,123 37% $266,112 577 3.7 California 8,306 2,344 10,650 78% $1,5
Slide 16: Net New Home Orders – Historical by Quarter
Net New Home Orders – Historical by Quarter Full-Year Absorption Rate: 2024 – 3.8 per month (YTD through June 30) 2023 – 3.5 per month 2022 – 2.9 per month 2021 – 4.8 per month 2020 – 4.0 per month 2,500 1,987 1,912 1,933 2020 2,000 1,896 1,814 2021 1,661 1,651 1,619 1,622 1,513 2022 1,500 1,409 1,4
Slide 17: Return on Equity and Risk Profile
Return on Equity and Risk Profile Increased focus on generating strong return on equity (ROE) growth through a combination of improved asset efficiency and greater operating margins with a continued focus on maintaining an efficient capital structure. Measured approach to share repurchase activity w
Slide 18: Book Value Per Share
Book Value Per Share Dual impact of the reduction in shares of common stock outstanding through opportunistic share repurchases and strong earnings have contributed to accelerated growth in book value per share and tangible book value per share at a compounded annual growth rate of 15%, respectively
Slide 19: Selected Balance Sheet Metrics
Selected Balance Sheet Metrics $ in thousands 6/30/2024 12/31/2023 Cash and cash equivalents $ 492,940 $ 868,953 ▪ Redeemed 5.875% $450 million Senior Real estate inventories $ 3,465,811 $ 3,337,483 Notes during the second quarter, reducing the ratio of homebuilding debt- Total homebuilding debt $ 9
Slide 20: 2024 Third Quarter & Full Year Outlook
2024 Third Quarter & Full Year Outlook
Slide 21: 2024 Third Quarter Outlook
2024 Third Quarter Outlook • Anticipate delivering between 1,450 and 1,550 homes at an average sales price between $685,000 and $695,000 for the third quarter • Anticipate homebuilding gross margin percentage for the third quarter will be in the range of 23.0% to 23.5% • Anticipate SG&A expense rati
Slide 22: 2024 Full Year Outlook
2024 Full Year Outlook • Anticipate delivering between 6,300 and 6,500 homes at an average sales price between $670,000 and $680,000 for the full year • Anticipate homebuilding gross margin percentage for the full year will be in the range of 23.0% to 23.5% • Anticipate SG&A expense ratio for the fu
Slide 23: Supplemental Data and Reconciliation
Supplemental Data and Reconciliation 23
Slide 24: 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 25: Reconciliation of Non-GAAP Financial Measures (cont'd) (unaudited)
Reconciliation of Non-GAAP Financial Measures (cont’d) (unaudited) The following table reconciles the Company’s ratio of homebuilding debt-to-capital to the non-GAAP ratio of net homebuilding debt-to-net capital. We believe that the ratio of net homebuilding debt-to-net capital is a relevant financi