Taylor Morrison Reports Third Quarter 2023 Results

SCOTTSDALE, Ariz., Oct. 25, 2023 /PRNewswire/ — Taylor Morrison Home Corporation (NYSE: TMHC), a leading national land developer and homebuilder, announced results for the third quarter ended September 30, 2023. Reported net income in the third quarter was $171 million, or $1.54 per diluted share. Adjusted net income in the third quarter was $180 million, or $1.62 per diluted share, excluding the impact of an inventory impairment and charge related to an extinguishment of debt.

Third quarter 2023 highlights included the following:

  • Home closings revenue of $1.6 billion, driven by 2,639 home closings at an average price of $611,000.
  • GAAP home closings gross margin of 23.1% and 23.9% excluding an inventory impairment.
  • Net sales orders of 2,592, driven by a monthly absorption pace of 2.7 per community versus 2.1 a year ago.
  • 74,000 homebuilding lots owned and controlled at quarter end, representing 6.1 years of total supply, of which 3.5 years was owned.
  • Homebuilding debt-to-capitalization of 25.9% on a gross basis and 18.8% net of $614 million of unrestricted cash. Total liquidity was $1.6 billion.
  • Credit rating upgraded by S&P Global to BB+ from BB with a Stable outlook.
  • Book value per share increased 21% year over year to $46.78.

“In the third quarter, our team once again achieved strong results, including the delivery of over 2,600 homes at a better-than-expected adjusted home closings gross margin of 23.9%. At the same time, we flexed each of our capital allocation priorities to increase our land investment, retire debt outstanding and repurchase our shares, all while ending the quarter with a significant liquidity position of $1.6 billion. In total, this drove a 21% year-over-year increase in our book value per share to a new high of nearly $47,” said Sheryl Palmer, Taylor Morrison Chairman and CEO.

“Our core performance was healthy, with margins and returns remaining well above our historic norms given the meaningful enhancements to our operating efficiencies over the last several years that we believe will continue to drive enhanced long-term performance. However, at the same time, it is important to recognize that this quarter reflected the temporary impact of last year’s slower starts and sales activity and compared to record profitability achieved this time last year. We also acknowledge that the rapid reacceleration in interest rates in September has once again injected some hesitation into the market alongside typical seasonal slowing.”

Palmer continued, “The strength of our diversified consumer strategy and balanced product portfolio better equips our homebuilding and financial services teams to effectively manage these headwinds. The resiliency of our business is a function of our diversification across buyer groups, emphasis on high-quality community locations and return-focused investment strategy that has been years in the making. Our portfolio meets buyer demand across entry-level, move-up and resort lifestyle consumers, with the necessary local and national scale to compete effectively. With different needs and preferences among these consumer sets, this approach allows us to operate both a spec and to-be-built operating model, which offers important strategic advantages, including production efficiencies, reduced risk and greater margin potential. These buyers group also respond differently to changes in interest rates, allowing us to calibrate our sales strategies to optimize our performance.”

“As a result, with exceptional cohesion between our teams and continued financial strength among our targeted consumers, we will continue to execute on our core operating strategies, with a focus on appropriately balancing pace and price by community to drive bottom-line results and returns. I am pleased that despite the challenges, we are once again raising our full-year guidance for home closings and adjusted home closings gross margin,” said Palmer.

Business Highlights (All comparisons are of the current quarter to the prior-year quarter, unless indicated.)

Homebuilding

  • Home closings revenue declined to $1.6 billion, driven by a 14% decrease in home closings to 2,639 and a 6% decrease in average closing price to $611,000.
  • On a reported basis, home closings gross margin declined 440 basis points year over year to 23.1% from the record-high of 27.5% a year ago. Excluding the impact of an impairment charge related to one community in the West facing a change in scope due to municipal requirements, adjusted home closings gross margin was 23.9%.
  • SG&A as a percentage of home closings revenue increased 300 basis points to 10.4% from the record-low of 7.4% a year ago as the Company adjusted to the change in market conditions.
  • Net sales orders increased 25% to 2,592, driven by a 26% increase in the monthly absorption pace to 2.7 per community and flattish ending community count of 325. Average net sales order price increased 1% to $623,000.
  • As a percentage of gross orders, cancellations equaled 11.4% versus 15.6% a year ago. This was consistent with historic norms.
  • Ending backlog was 6,118 homes with a sales value of $4.1 billion. Backlog customer deposits averaged approximately $62,000, or just over 9%, per home.

Land Portfolio

  • Homebuilding land acquisition and development spend totaled $552 million. Development-related spend accounted for 42% of the total. Year to date, total homebuilding land acquisition and development spend has been approximately $1.3 billion.
  • Homebuilding lot supply was approximately 74,000 owned and controlled homesites, down from 80,000.
  • Controlled homebuilding lots as a share of total lot supply was 42%, flat from a year ago.
  • Based on trailing twelve-month home closings, total homebuilding lots represented 6.1 years of total supply, of which 3.5 years was owned. This was unchanged from a year ago.

Financial Services

  • The mortgage capture rate reached another all-time high of 88%, up from 68%.
  • Borrowers had an average credit score of 753 and debt-to-income ratio of 39%.

Balance Sheet

  • Total liquidity was approximately $1.6 billion, including $614 million of unrestricted cash and $1.1 billion of total capacity on the Company’s revolving credit facilities, which were undrawn outside of normal letters of credit.
  • In September, the Company redeemed the full $350 million principal outstanding related to its 2024 Senior Notes using cash on hand.
  • The gross homebuilding debt-to-capital ratio was 25.9%, down from 37.1% a year ago. Including $614 million of unrestricted cash on hand, the net homebuilding debt-to-capital ratio was 18.8%, down from 34.0% a year ago.
  • In September, the Company received an upgraded credit rating from S&P Global to BB+ from BB with a Stable outlook in recognition of its strong operating momentum, earnings performance and debt reduction.
  • During the quarter, the Company repurchased 2.2 million shares for $100 million at an average price of approximately $46. At quarter end, the Company had $176 million remaining on its share repurchase authorization.

Business Outlook

Fourth Quarter 2023

  • Home closings are expected to be approximately 2,950
  • Average closing price is expected to be around $615,000
  • Home closings gross margin is expected to be approximately 23.0%
  • Ending active community count is expected to be between 320 to 325
  • Effective tax rate is expected to be approximately 25%
  • Diluted share count is expected to be approximately 109 million

Full Year 2023

  • Home closings are now expected to be approximately 11,250
  • Adjusted home closings gross margin excluding inventory impairments is now expected to be around 23.7%(1)
  • Ending active community count is expected to be between 320 to 325
  • SG&A as a percentage of home closings revenue is expected to be in the high-9% range
  • Effective tax rate is expected to be approximately 25%
  • Diluted share count is now expected to be approximately 110 million
  • Land and development spend is expected to be approximately $1.8 billion

(1) Note: The adjusted full-year home closings gross margin guidance excludes an approximate 10 basis point impact related to the inventory impairment recorded in the third quarter.

Quarterly Financial Comparison

(Dollars in thousands)


Q3 2023



Q3 2022



Q3 2023 vs. Q3 2022


Total Revenue


$

1,675,545



$

2,034,644




(17.6)

%

Home Closings Revenue


$

1,611,883



$

1,983,775




(18.7)

%

Home Closings Gross Margin


$

372,884



$

545,611




(31.7)

%




23.1

%



27.5

%


440 bps decrease


 SG&A


$

167,791



$

147,049




14.1

%

% of Home Closings Revenue



10.4

%



7.4

%


300 bps increase


Earnings Conference Call Webcast

A public webcast to discuss the Company’s earnings will be held later today at 8:30 a.m. ET. A live audio webcast of the conference call will be available on Taylor Morrison’s website at www.taylormorrison.com on the Investor Relations portion of the site under the Events & Presentations tab. For call participants, the dial-in number is (833) 470-1428 and conference ID is 524943. The call will be recorded and available for replay on the Company’s website.

About Taylor Morrison

Headquartered in Scottsdale, Arizona, Taylor Morrison is one of the nation’s leading homebuilders and developers. We serve a wide array of consumers from coast to coast, including first-time, move-up, luxury and resort lifestyle homebuyers and renters under our family of brands—including Taylor Morrison, Esplanade, Darling Homes Collection by Taylor Morrison and Yardly. From 2016-2023, Taylor Morrison has been recognized as America’s Most Trusted® Builder by Lifestory Research. Our strong commitment to sustainability, our communities, and our team is highlighted in our latest Environmental, Social, and Governance (ESG) Report on our website.

Forward-Looking Statements

This earnings summary includes “forward-looking statements.” These statements are subject to a number of risks, uncertainties and other factors that could cause our actual results, performance, prospects or opportunities, as well as those of the markets we serve or intend to serve, to differ materially from those expressed in, or implied by, these statements. You can identify these statements by the fact that they do not relate to matters of a strictly factual or historical nature and generally discuss or relate to forecasts, estimates or other expectations regarding future events. Generally, the words “”anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “may,” “will,” “can,” “could,” “might,” “should” and similar expressions identify forward-looking statements, including statements related to expected financial, operating and performance results, planned transactions, planned objectives of management, future developments or conditions in the industries in which we participate and other trends, developments and uncertainties that may affect our business in the future.

Such risks, uncertainties and other factors include, among other things: inflation or deflation; changes in general and local economic conditions; slowdowns or severe downturns in the housing market; homebuyers’ ability to obtain suitable financing; increases in interest rates, taxes or government fees; shortages in, disruptions of and cost of labor; higher cancellation rates of existing agreements of sale; competition in our industry; any increase in unemployment or underemployment; the scale and scope of the ongoing COVID-19  pandemic; the seasonality of our business; the physical impacts of climate change and the increased focus by third-parties on sustainability issues; our ability to obtain additional performance, payment and completion surety bonds and letters of credit; significant home warranty and construction defect claims; our reliance on subcontractors; failure to manage land acquisitions, inventory and development and construction processes; availability of land and lots at competitive prices; decreases in the market value of our land inventory; new or changing government regulations and legal challenges; our compliance with environmental laws and regulations regarding climate change; our ability to sell mortgages we originate and claims on loans sold to third parties; governmental regulation applicable to our financial services and title services business; the loss of any of our important commercial lender relationships; our ability to use deferred tax assets; raw materials and building supply shortages and price fluctuations; our concentration of significant operations in certain geographic areas; risks associated with our unconsolidated joint venture arrangements; information technology failures and data security breaches; costs to engage in and the success of future growth or expansion of our operations or acquisitions or disposals of businesses; costs associated with our defined benefit and defined contribution pension schemes; damages associated with any major health and safety incident; our ownership, leasing or occupation of land and the use of hazardous materials; existing or future litigation, arbitration or other claims; negative publicity or poor relations with the residents of our communities; failure to recruit, retain and develop highly skilled, competent people; utility and resource shortages or rate fluctuations; constriction of the capital markets; risks related to instability in the banking system; risks associated with civil unrest, acts of terrorism, threats to national security, the conflicts in Eastern Europe and the Middle East and other geopolitical events; any failure of lawmakers to agree on a budget or appropriation legislation to fund the federal government’s operations (also known as a government shutdown), and financial markets’ and businesses’ reactions to any such failure; risks related to our substantial debt and the agreements governing such debt, including restrictive covenants contained in such agreements; our ability to access the capital markets; the risks associated with maintaining effective internal controls over financial reporting; provisions in our charter and bylaws that may delay or prevent an acquisition by a third party; and our ability to effectively manage our expanded operations.

In addition, other such risks and uncertainties may be found in our most recent annual report on Form 10-K and our subsequent quarterly reports filed with the Securities and Exchange Commission (SEC) as such factors may be updated from time to time in our periodic filings with the SEC. We undertake no duty to update any forward-looking statement, whether as a result of new information, future events or changes in our expectations, except as required by applicable law.

Taylor Morrison Home Corporation

Consolidated Statements of Operations

(In thousands, except per share amounts, unaudited)




Three Months Ended

September 30,



Nine Months Ended

September 30,




2023



2022



2023



2022


Home closings revenue, net


$

1,611,883



$

1,983,775



$

5,221,225



$

5,511,204


Land closings revenue



14,291




14,225




31,439




66,651


Financial services revenue



40,045




27,749




117,108




98,419


Amenity and other revenue



9,326




8,895




28,194




56,517


          Total revenue



1,675,545




2,034,644




5,397,966




5,732,791


Cost of home closings



1,238,999




1,438,164




3,980,749




4,084,748


Cost of land closings



13,572




11,571




30,620




50,139


Financial services expenses



23,128




20,395




70,618




66,092


Amenity and other expenses



8,128




6,574




25,010




39,264


          Total cost of revenue



1,283,827




1,476,704




4,106,997




4,240,243


Gross margin



391,718




557,940




1,290,969




1,492,548


Sales, commissions and other marketing costs



98,797




94,692




304,591




279,950


General and administrative expenses



68,994




52,357




205,904




189,905


Net (income)/loss from unconsolidated entities



(1,934)




1,180




(7,049)




2,986


Interest (income)/expense, net



(5,782)




4,382




(12,013)




13,823


Other expense/(income), net



2,968




5,751




6,683




(4,720)


Loss/(gain) on extinguishment of debt, net



269




(71)




269




(13,542)


Income before income taxes



228,406




399,649




792,584




1,024,146


Income tax provision



57,960




90,418




196,005




243,300


Net income before allocation to non-controlling interests



170,446




309,231




596,579




780,846


Net loss/(income) attributable to non-controlling interests



245




548




(235)




(3,377)


Net income available to Taylor Morrison Home Corporation


$

170,691



$

309,779



$

596,344



$

777,469


Earnings per common share













Basic


$

1.57



$

2.75



$

5.48



$

6.63


Diluted


$

1.54



$

2.72



$

5.40



$

6.56


Weighted average number of shares of common stock:













Basic



108,837




112,701




108,827




117,242


Diluted



110,622




113,780




110,536




118,438


Taylor Morrison Home Corporation

Condensed Consolidated Balance Sheets

(In thousands, unaudited)




September 30,

2023



December 31,

2022


Assets







Cash and cash equivalents


$

613,811



$

724,488


Restricted cash



765




2,147


Total cash, cash equivalents, and restricted cash



614,576




726,635


Owned inventory



5,479,987




5,346,905


Consolidated real estate not owned



423




23,971


Total real estate inventory



5,480,410




5,370,876


Land deposits



206,258




263,356


Mortgage loans held for sale



241,749




346,364


Lease right of use assets



76,463




90,446


Prepaid expenses and other assets, net



305,581




265,392


Other receivables, net



188,723




191,504


Investments in unconsolidated entities



329,634




282,900


Deferred tax assets, net



67,656




67,656


Property and equipment, net



262,671




202,398


Goodwill



663,197




663,197


Total assets


$

8,436,918



$

8,470,724


Liabilities







Accounts payable


$

272,830



$

269,761


Accrued expenses and other liabilities



487,262




490,253


Lease liabilities



86,401




100,174


Customer deposits



380,544




412,092


Estimated development liabilities



42,271




43,753


Senior notes, net



1,468,255




1,816,303


Loans payable and other borrowings



332,177




361,486


Revolving credit facility borrowings







Mortgage warehouse borrowings



191,645




306,072


Liabilities attributable to consolidated real estate not owned



423




23,971


Total liabilities


$

3,261,808



$

3,823,865


Stockholders’ Equity







Total stockholders’ equity



5,175,110




4,646,859


Total liabilities and stockholders’ equity


$

8,436,918



$

8,470,724


Homes Closed and Home Closings Revenue, Net:




Three Months Ended September 30,




Homes Closed



Home Closings Revenue, Net



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



996




1,118




(10.9)

%


$

572,971



$

638,270




(10.2)

%


$

575



$

571




0.7

%

Central



709




835




(15.1)

%



423,396




522,247




(18.9)

%



597




625




(4.5)

%

West



934




1,097




(14.9)

%



615,516




823,258




(25.2)

%



659




750




(12.1)

%

Total



2,639




3,050




(13.5)

%


$

1,611,883



$

1,983,775




(18.7)

%


$

611



$

650




(6.0)

%




Nine Months Ended September 30,




Homes Closed



Home Closings Revenue, Net



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



3,228




3,152




2.4

%


$

1,906,862



$

1,757,444




8.5

%


$

591



$

558




5.9

%

Central



2,376




2,277




4.3

%



1,499,420




1,347,828




11.2

%



631




592




6.6

%

West



2,701




3,421




(21.0)

%



1,814,943




2,405,932




(24.6)

%



672




703




(4.4)

%

Total



8,305




8,850




(6.2)

%


$

5,221,225



$

5,511,204




(5.3)

%


$

629



$

623




1.0

%


Net Sales Orders:




Three Months Ended September 30,




Net Sales Orders



Sales Value



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



940




1,041




(9.7)

%


$

559,524



$

640,093




(12.6)

%


$

595



$

615




(3.3)

%

Central



641




450




42.4

%



374,224




267,681




39.8

%



584




595




(1.8)

%

West



1,011




578




74.9

%



680,666




372,223




82.9

%



673




644




4.5

%

Total



2,592




2,069




25.3

%


$

1,614,414



$

1,279,997




26.1

%


$

623



$

619




0.6

%




Nine Months Ended September 30,




Net Sales Orders



Sales Value



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



3,066




3,189




(3.9)

%


$

1,786,988



$

1,976,798




(9.6)

%


$

583



$

620




(6.0)

%

Central



2,123




1,979




7.3

%



1,248,196




1,294,106




(3.5)

%



588




654




(10.1)

%

West



3,280




2,509




30.7

%



2,219,056




1,878,886




18.1

%



677




749




(9.6)

%

Total



8,469




7,677




10.3

%


$

5,254,240



$

5,149,790




2.0

%


$

620



$

671




(7.6)

%


Sales Order Backlog:




As of September 30,




Sold Homes in Backlog



Sales Value



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



2,421




3,256




(25.6)

%


$

1,613,188



$

2,121,673




(24.0)

%


$

666



$

652




2.1

%

Central



1,464




2,489




(41.2)

%



960,269




1,694,111




(43.3)

%



656




681




(3.7)

%

West



2,233




2,196




1.7

%



1,523,545




1,579,937




(3.6)

%



682




719




(5.1)

%

Total



6,118




7,941




(23.0)

%


$

4,097,002



$

5,395,721




(24.1)

%


$

670



$

679




(1.3)

%

Ending Active Selling Communities:




As of September 30,



Change




2023



2022





East



107




118




(9.3)

%

Central



94




105




(10.5)

%

West



124




103




20.4

%

Total



325




326




(0.3)

%

Reconciliation of Non-GAAP Financial Measures

In addition to the results reported in accordance with accounting principles generally accepted in the United States (“GAAP”), we provide our investors with supplemental information relating to: (i) adjusted net income and adjusted earnings per common share, (ii) adjusted income before income taxes and related margin, (iii) adjusted home closings gross margin; (iv) EBITDA and adjusted EBITDA and (v) net homebuilding debt to capitalization ratio.

Adjusted net income, adjusted earnings per common share and adjusted income before income taxes and related margin are non-GAAP financial measures that reflect the net income/(loss) available to the Company excluding, to the extent applicable in a given period, the impact of inventory impairment charges, impairment of investment in unconsolidated entities, pre-acquisition abandonment charges, gains/losses on land transfers to joint ventures and extinguishment of debt, net, and in the case of adjusted net income and adjusted earnings per common share, the tax impact due to such items. EBITDA and Adjusted EBITDA are non-GAAP financial measures that measure performance by adjusting net income before allocation to non-controlling interests to exclude, as applicable, interest expense/(income), net, amortization of capitalized interest, income taxes, depreciation and amortization (EBITDA), non-cash compensation expense, if any, inventory impairment charges, impairment of investment in unconsolidated entities, pre-acquisition abandonment charges, gains/losses on land transfers to joint ventures and extinguishment of debt, net. Net homebuilding debt to capitalization ratio is a non-GAAP financial measure we calculate by dividing (i) total debt, plus unamortized debt issuance cost/(premium), net, and less mortgage warehouse borrowings, net of unrestricted cash and cash equivalents (“net homebuilding debt”), by (ii) total capitalization (the sum of net homebuilding debt and total stockholders’ equity). Adjusted home closings gross margin is a non-GAAP financial measure based on GAAP home closings gross margin (which is inclusive of capitalized interest), excluding inventory impairment charges.

Management uses these non-GAAP financial measures to evaluate our performance on a consolidated basis, as well as the performance of our regions, and to set targets for performance-based compensation.  We also use the ratio of net homebuilding debt to total capitalization as an indicator of overall leverage and to evaluate our performance against other companies in the homebuilding industry.  In the future, we may include additional adjustments in the above-described non-GAAP financial measures to the extent we deem them appropriate and useful to management and investors.

We believe that adjusted net income, adjusted earnings per common share, adjusted income before income taxes and related margin, as well as EBITDA and adjusted EBITDA, are useful for investors in order to allow them to evaluate our operations without the effects of various items we do not believe are characteristic of our ongoing operations or performance and also because such metrics assist both investors and management in analyzing and benchmarking the performance and value of our business. Adjusted EBITDA also provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization, or unusual items. Because we use the ratio of net homebuilding debt to total capitalization to evaluate our performance against other companies in the homebuilding industry, we believe this measure is also relevant and useful to investors for that reason. We believe that adjusted home closings gross margin is useful to investors because it allows investors to evaluate the performance of our homebuilding operations without the varying effects of items or transactions we do not believe are characteristic of our ongoing operations or performance.

These non-GAAP financial measures should be considered in addition to, rather than as a substitute for, the comparable U.S. GAAP financial measures of our operating performance or liquidity. Although other companies in the homebuilding industry may report similar information, their definitions may differ. We urge investors to understand the methods used by other companies to calculate similarly-titled non-GAAP financial measures before comparing their measures to ours.

A reconciliation of (i) adjusted net income and adjusted earnings per common share, (ii) adjusted income before income taxes and related margin, (iii) adjusted home closings gross margin; (iv) EBITDA and adjusted EBITDA and (v) net homebuilding debt to capitalization ratio to the comparable GAAP measures is presented below.

Adjusted Net Income and Adjusted Earnings Per Common Share






Three Months Ended September 30,


(Dollars in thousands, except per share data)


2023



2022


Net income available to TMHC


$

170,691



$

309,779


Inventory impairment(1)



11,791





Gain on land transfers to joint ventures(2)






(808)


Loss/(gain) on extinguishment of debt, net(3)



269




(71)


Tax impact due to above non-GAAP reconciling items



(3,060)




205


Adjusted net income


$

179,691



$

309,105


Basic weighted average number of  shares



108,837




112,701


Adjusted earnings per common share – Basic


$

1.65



$

2.74


Diluted weighted average number of shares



110,622




113,780


Adjusted earnings per common share – Diluted


$

1.62



$

2.72




(1)

Charge included in Cost of home closings on the Consolidated Statement of Operations

(2)

Charge included in Other/(income) expense, net on the Consolidated Statement of Operations 

(3)

Included in Loss/(gain) on extinguishment of debt, net on the Consolidated Statement of Operations

Adjusted Income Before Income Taxes and Related Margin






Three Months Ended September 30,


(Dollars in thousands)


2023



2022


Income before income taxes


$

228,406



$

399,649


Inventory impairment



11,791





Gain on land transfers to joint ventures






(808)


Loss/(gain) on extinguishment of debt, net



269




(71)


Adjusted income before income taxes


$

240,466



$

398,770


Total revenue


$

1,675,545



$

2,034,644


Income before income taxes margin



13.6

%



19.6

%

Adjusted income before income taxes margin



14.4

%



19.6

%





Adjusted Home Closings Gross Margin






Three Months Ended

September 30,


(Dollars in thousands)


2023



2022


Home closings revenue


$

1,611,883



$

1,983,775


Cost of home closings


$

1,238,999



$

1,438,164


Home closings gross margin


$

372,884



$

545,611


Inventory impairment



11,791





Adjusted home closings gross margin


$

384,675



$

545,611


Home closings gross margin as a percentage of home closings revenue



23.1

%



27.5

%

Adjusted home closings gross margin as a percentage of home closings revenue



23.9

%



27.5

%





EBITDA and Adjusted EBITDA Reconciliation






Three Months Ended September 30,


(Dollars in thousands)


2023



2022


Net income before allocation to non-controlling interests


$

170,446



$

309,231


Interest (income)/expense, net



(5,782)




4,382


Amortization of capitalized interest



32,377




33,774


Income tax provision



57,960




90,418


Depreciation and amortization



2,728




1,484


EBITDA


$

257,729



$

439,289


Non-cash compensation expense



5,702




5,333


Inventory impairment



11,791





Gain on land transfers to joint ventures






(808)


Loss/(gain) on extinguishment of debt, net



269




(71)


Adjusted EBITDA


$

275,491



$

443,743


Total revenue


$

1,675,545



$

2,034,644


Net income before allocation to non-controlling interests as a percentage of

   total revenue



10.2

%



15.2

%

EBITDA as a percentage of total revenue



15.4

%



21.6

%

Adjusted EBITDA as a percentage of total revenue



16.4

%



21.8

%

Debt to Capitalization Ratios Reconciliation




(Dollars in thousands)


As of

September 30, 2023



As of

June 30, 2023



As of

September 30, 2022


Total debt


$

1,992,077



$

2,393,571



$

2,729,924


Plus: unamortized debt issuance cost, net



8,815




9,613




11,242


Less: mortgage warehouse borrowings


$

(191,645)




(249,898)




(146,335)


Total homebuilding debt


$

1,809,247



$

2,153,286



$

2,594,831


Total equity



5,175,110




5,095,313




4,403,466


Total capitalization


$

6,984,357



$

7,248,599



$

6,998,297


Total homebuilding debt to capitalization ratio



25.9

%



29.7

%



37.1

%

Total homebuilding debt


$

1,809,247



$

2,153,286



$

2,594,831


Less: cash and cash equivalents



(613,811)




(1,227,264)




(329,244)


Net homebuilding debt


$

1,195,436



$

926,022



$

2,265,587


Total equity



5,175,110




5,095,313




4,403,466


Total capitalization


$

6,370,546



$

6,021,335



$

6,669,053


Net homebuilding debt to capitalization ratio



18.8

%



15.4

%



34.0

%

CONTACT:
Mackenzie Aron, VP Investor Relations

(480) 734-2060

investor@taylormorrison.com

SOURCE Taylor Morrison


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