Green Brick Partners, Inc. · NYSE:GRBK
Green Brick Partners — Q4 2020 Earnings Presentation
23 slides from Green Brick Partners's earnings presentation, March 2021
Slide 1: Fourth Quarter Investor Call Presentation 2020
Trophy Signature Homes Apples Crossing| Fairview, Texas FOURTH QUARTER INVESTOR CALL PRESENTATION 2020 BUILDING COMMUNITIES | DEVELOPING DREAMS
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation and our earnings call contain “forward-looking statements” within the meaning of the Private Securities Litigation Act of 1995. These statements concern expectations, beliefs, projections, plans and strategies, anticipated events or trends and similar exp
Slide 3: Management Presenters
MANAGEMENT PRESENTERS Jim Brickman Rick Costello Jed Dolson Chief Executive Officer Chief Financial Officer Chief Operating Officer and Executive VP • Over 40 years in real estate development • Over 27 years of financial and operating • Over 19 years of land development and and homebuilding. experie
Slide 4: Green Brick Is a Diversified Builder with 8 Brands in 4 Major Markets
GREEN BRICK IS A DIVERSIFIED BUILDER WITH 8 BRANDS IN 4 MAJOR MARKETS Products Team Builders Market Price Range Ownership Offered Dallas, TX Single Family $240k - $690k 100% Ft. Worth, TX Dallas, TX Townhomes $230k - $530k 100% Ft. Worth, TX Financial Services Dallas, TX Single Family $320k - $760k
Slide 5: Recent News
RECENT NEWS Green Brick Partners is pleased to announce its ranking on Forbes’ 2021 America’s Best Small Companies list • Green Brick Partners placed 5th on this year’s list of 850 companies evaluated, the highest rank of any public homebuilder on Forbes’ Best Companies lists. • Based on Forbes’ ana
Slide 6: Our Markets Are Well-Positioned to Generate Future Growth
OUR MARKETS ARE WELL-POSITIONED TO GENERATE FUTURE GROWTH DFW and Atlanta saw the largest decline in active listings of the largest MSA’s in January 2021 spurred by strong employment and affordability Key Points: • Despite 54.8% decline in active listings, DFW saw only a 6.3% increase in median list
Slide 7: Aging of Millennial Generation Is Expected to Be Tailwind for Housing Demand
AGING OF MILLENIAL GENERATION IS EXPECTED TO BE TAILWIND FOR HOUSING DEMAND With the 35-44 year-old demographic considered the most active homebuyer, growth of this buyer segment indicates future strong demand. Population of 35-44 Year-Olds in the US Based on Ten-Year Trailing Birth Rates 43,000 Pop
Slide 8: Growth Drivers
GROWTH DRIVERS Green Brick continues to demonstrate industry-leading growth with industry-low financial leverage Total Revenue ($ in Millions) Backlog ($ in Millions) Lots Owned and Controlled $1,000 $750 15,000 $800 $976.0 $600 $686.9 12,000 14,468 $600 $450 9,000 $623.6 8,078 $400 $300 6,000 $200
Slide 9: Sustained Growth Through Prudent Land Development
SUSTAINED GROWTH THROUGH PRUDENT LAND DEVELOPMENT We have the strong balance sheet and operational excellence for continued growth Full Year Total Revenue and Year-End Lot Supply for Green Brick Partners* December 2020 1,000,000 12,500 800,000 8,920 10,000 600,000 6,419 7,500 Dollars ($) Lots 6,235
Slide 10: Growth Potential Well Established with Total Lots Up 20% Sequentially
GREEN BRICK’S GROWTH POTENTIAL IS WELL ESTABLISHED WITH TOTAL LOTS UP 20% SEQUENTIALLY Green Brick’s capacity to acquire and entitle land is critical to meet growing buyer demand • During Q4 2020, Green Brick added roughly 3,400 lots owned and controlled at 18 different communities across Dallas-Ft.
Slide 11: Expansion of Trophy Signature Homes Remains Key Growth Driver
EXPANSION OF TROPHY SIGNATURE HOMES REMAINS KEY GROWTH DRIVER Growing from 10 to 23 selling communities over the past 12 months, Trophy brand has significantly expanded in the DFW market Trophy Signature Homes Communities • Trophy opened 16 new selling communities during the last six months of 2020.
Slide 12: Land Position
LAND POSITION Land is well positioned in attractive submarkets Atlanta Metro Area Dallas-Ft. Worth Metro Area Submarket Grades Most desirable Desirable area Median desirability More affordable Most affordable GRBK Locations Land position highlights 103 27* 5,722 Active selling communities Communitie
Slide 13: Industry-Leading Gross Margin
INDUSTRY-LEADING GROSS MARGIN Green Brick maintains some of the best margins in the industry, well above most small and mid-cap peers • GRBK Gross Margin Percentage is 24.2% for the twelve months ended December 31, 2020 versus an average 19.5% for covered public builders (Peer data based on most rec
Slide 14: Homebuyer Customer Diversification in Texas, Georgia & Florida Markets
HOMEBUYER CUSTOMER DIVERSIFICATION IN TEXAS, GEORGIA, & FLORIDA MARKETS We also manage risk by diversifying our homebuyer customer mix Homebuyer Customer Mix Full Year GRBK Home Closings Revenue by Product Type 2018 Home Closings Revenue 2020 Home Closings Revenue 13% 10% 9% 10% 3% 8% 7% 19% 62% 33%
Slide 15: Financial Highlights
FINANCIAL HIGHLIGHTS (Unaudited) Q4 Q4 Qtr over Qtr (Dollars in Millions, Except EPS) FY 2020 FY 2019 YoY Change Notes 2020 2019 Change New Homes Delivered 585 514 13.8% 2,208 1,719 28.4% Net New Home Orders 848 590 43.7% 2,885 1,923 50.0% Record net new orders. Beat Q3 2020 order of 823 by 25 units
Slide 16: Strong Risk-Adjusted Growth Relative to Peers
GREEN BRICK PROVIDES STRONG RISK-ADJUSTED GROWTH RELATIVE TO PEERS Based on our key performance indicators, we believe Green Brick has one of the best growth opportunity profiles among peers Growth in Homebuilding Pre-Tax Income Return to Rank(1) Builder Gross Margin % Interest Coverage Debt to Capi
Slide 17: Balance Sheet Strength
BALANCE SHEET STRENGTH Green Brick continues to maintain its position as one of the lowest leveraged public builders • GRBK Debt to Capital is 25.6% as of December 31, 2020 versus an average 39.5% for covered public builders (Peer data based on most recent filings of full annual results as of 3.1.20
Slide 18: Appendix
APPENDIX BUILDING COMMUNITIES | DEVELOPING DREAMS 18
Slide 19: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION Adjusted Homebuilding Gross Margin Reconciliation Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended (Unaudited, in Thousands) December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Residential Units Revenue $246,437 $223,270 $930,1
Slide 20: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION Adjusted GRBK Pre-tax Income, EBITDA, and Interest Coverage Ratio Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended (Unaudited, in Thousands) December 31, 2020 December 31, 2019 December 31, 2020 December 31, 2019 Net Income Attributable to Green B
Slide 21: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION GRBK Pre-tax Income Return on Average Invested Capital (Unaudited, in Thousands) Twelve Months Ended December 31, 2020 Net Income Attributable to Green Brick $ 113,693 Income Tax Expense Attributable to Green Brick 25,010 Adjusted Pre-tax Income Attributable to Green Brick $
Slide 22: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION Supporting Calculations for Risk-Adjusted Growth Ranking on Slide 16 Growth in Gross Net Debt Rank Peer Homebuilding Rank Peer Rank Peer Margin % to Capital Revenues Builder YOY Growth in Gross Pre-Tax Return Rank Interest Debt to 1 LGIH 28.8% 1 LGIH 25.5% 1 GRBK 25.6% Rank b
Slide 23: Fourth Quarter Investor Call Presentation 2020
FOURTH QUARTER INVESTOR CALL PRESENTATION 2020 2805 Dallas Parkway, Suite 400 Plano, Texas 75093 | www.greenbrickpartners.com BUILDING COMMUNITIES | DEVELOPING DREAMS