Supplemental Guarantor Information

6 Months Ended

Apr. 30, 2011

Supplemental Guarantor Information [Abstract]

17. Supplemental Guarantor Information

A 100% owned subsidiary of the Company, Toll Brothers Finance Corp. (the “Subsidiary Issuer”), issued $300 million of 6.875% Senior Notes due 2012 on November 22, 2002; $250 million of 5.95% Senior Notes due 2013 on September 3, 2003; $300 million of 4.95% Senior Notes due 2014 on March 16, 2004; $300 million of 5.15% Senior Notes due 2015 on June 2, 2005; $400 million of 8.91% Senior Notes due 2017 on April 13, 2009; and $250 million of 6.75% Senior Notes due 2019 on September 22, 2009. In fiscal 2009, the Subsidiary Issuer redeemed $105.1 million of its 6.875% Senior Notes due 2012 and $94.9 million of its 5.95% Senior Notes due 2013. The obligations of the Subsidiary Issuer to pay principal, premiums, if any, and interest is guaranteed jointly and severally on a senior basis by the Company and substantially all of the Company’s 100% owned home building subsidiaries (the “Guarantor Subsidiaries”). The guarantees are full and unconditional. The Company’s non-home building subsidiaries and several of its home building subsidiaries (the “Non-Guarantor Subsidiaries”) do not guarantee the debt. Separate financial statements and other disclosures concerning the Guarantor Subsidiaries are not presented because management has determined that such disclosures would not be material to investors. Prior to the above described senior debt issuances, the Subsidiary Issuer did not have any operations.

Supplemental consolidating financial information of Toll Brothers, Inc., the Subsidiary Issuer, the Guarantor Subsidiaries, the Non-Guarantor Subsidiaries and the eliminations to arrive at Toll Brothers, Inc. on a consolidated basis is presented below ($ amounts in thousands).

Consolidating Balance Sheet at April 30, 2011


	Toll								Non-
	Brothers,			Subsidiary		Guarantor			Guarantor
	Inc.			Issuer		Subsidiaries			Subsidiaries			Eliminations			Consolidated
ASSETS
Cash and cash equivalents							822,662			127,234						949,896
Marketable securities							297,846									297,846
Restricted cash							32,125									32,125
Inventory							2,887,796			496,924						3,384,720
Property, construction and office equipment, net							76,355			23,095						99,450
Receivables, prepaid expenses and other assets					7,449		61,598			21,207			(2,509	)		87,745
Mortgage loans held for sale										28,996						28,996
Customer deposits held in escrow							12,934			4,925						17,859
Investments in and advances to unconsolidated entities and non-performing loan portfolio							103,538			81,721						185,259
Investments in and advances to consolidated entities		2,694,956			1,563,721		(876,369	)		(455,362	)		(2,926,946	)		—

		2,694,956			1,571,170		3,418,485			328,740			(2,929,455	)		5,083,896


LIABILITIES AND EQUITY
Liabilities:
Loans payable							62,146			43,110						105,256
Senior notes					1,545,067											1,545,067
Mortgage company warehouse loan										24,906						24,906
Customer deposits							81,430			9,773						91,203
Accounts payable							92,267			197						92,464
Accrued expenses					26,103		216,016			286,064			(2,360	)		525,823
Income taxes payable		146,051								(2,000	)					144,051

Total liabilities		146,051			1,571,170		451,859			362,050			(2,360	)		2,528,770


Equity:
Stockholders’ equity:
Common stock		1,669								2,003			(2,003	)		1,669
Additional paid-in capital		370,361					4,420			2,734			(7,154	)		370,361
Retained earnings		2,177,100					2,962,431			(44,268	)		(2,918,163	)		2,177,100
Treasury stock, at cost
Accumulated other comprehensive loss		(225	)				(225	)					225			(225	)

Total stockholders’ equity		2,548,905			—		2,966,626			(39,531	)		(2,927,095	)		2,548,905
Noncontrolling interest										6,221						6,221

Total equity		2,548,905			—		2,966,626			(33,310	)		(2,927,095	)		2,555,126

		2,694,956			1,571,170		3,418,485			328,740			(2,929,455	)		5,083,896

Consolidating Balance Sheet at October 31, 2010


	Toll								Non-
	Brothers,			Subsidiary		Guarantor			Guarantor
	Inc.			Issuer		Subsidiaries			Subsidiaries			Eliminations			Consolidated
ASSETS
Cash and cash equivalents							930,387			108,673						1,039,060
Marketable securities							197,867									197,867
Restricted cash							60,906									60,906
Inventory							2,862,796			378,929						3,241,725
Property, construction and office equipment, net							79,516			400						79,916
Receivables, prepaid expenses and other assets		27			8,104		66,280			24,565			(1,937	)		97,039
Mortgage loans held for sale										93,644						93,644
Customer deposits held in escrow							13,790			7,576						21,366
Investments in and advances to unconsolidated entities and non- performing loan portfolio							116,247			82,195						198,442
Income tax refund recoverable		141,590														141,590
Investments in and advances to consolidated entities		2,578,195			1,562,109		(871,125	)		(315,074	)		(2,954,105	)		—

		2,719,812			1,570,213		3,456,664			380,908			(2,956,042	)		5,171,555


LIABILITIES AND EQUITY
Liabilities:
Loans payable							63,442			31,049						94,491
Senior notes					1,544,110											1,544,110
Mortgage company warehouse loan										72,367						72,367
Customer deposits							72,819			4,337						77,156
Accounts payable							91,498			240						91,738
Accrued expenses					26,103		242,793			303,413			(1,988	)		570,321
Income taxes payable		164,359								(2,000	)					162,359

Total liabilities		164,359			1,570,213		470,552			409,406			(1,988	)		2,612,542


Equity:
Stockholders’ equity:
Common stock		1,664								2,003			(2,003	)		1,664
Additional paid-in capital		360,006					4,420			2,734			(7,154	)		360,006
Retained earnings		2,194,456					2,982,269			(36,795	)		(2,945,474	)		2,194,456
Treasury stock, at cost		(96	)													(96	)
Accumulated other comprehensive loss		(577	)				(577	)					577			(577	)

Total stockholders’ equity		2,555,453			—		2,986,112			(32,058	)		(2,954,054	)		2,555,453
Noncontrolling interest										3,560						3,560

Total equity		2,555,453			—		2,986,112			(28,498	)		(2,954,054	)		2,559,013

		2,719,812			1,570,213		3,456,664			380,908			(2,956,042	)		5,171,555

Condensed Consolidating Statement of Operations for the six months ended April 30, 2011 ($ in thousands):


	Toll									Non-
	Brothers,			Subsidiary			Guarantor			Guarantor
	Inc.			Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated

Revenues								626,515			27,276						653,791


Cost of revenues								530,929			30,834			(3,444	)		558,319
Selling, general and administrative		53			670			132,926			18,739			(24,087	)		128,301
Interest expense					52,483			1,504						(52,483	)		1,504

		53			53,153			665,359			49,573			(80,014	)		688,124

Loss from operations		(53	)		(53,153	)		(38,844	)		(22,297	)		80,014			(34,333	)
Other
(Loss) income from unconsolidated entities and non-performing loan portfolio								3,705			(25,577	)					(21,872	)
Interest and other					53,153			(13,339	)		18,223			(50,363	)		7,674
Loss from subsidiaries		(48,478	)											48,478			—

Loss before income tax benefit		(48,531	)		—			(48,478	)		(29,651	)		78,129			(48,531	)
Income tax benefit		(31,175	)					( 31,784	)		(19,034	)		50,818			(31,175	)

Net loss		(17,356	)		—			(16,694	)		(10,617	)		27,311			(17,356	)

Condensed Consolidating Statement of Operations for the three months ended April 30, 2011 ($ in thousands):


	Toll									Non-
	Brothers,			Subsidiary			Guarantor			Guarantor
	Inc.			Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated

Revenues								306,672			13,003						319,675


Cost of revenues								262,673			14,887			(1,206	)		276,354
Selling, general and administrative		25			329			68,938			10,211			(12,453	)		67,050
Interest expense					26,638			392						(26,638	)		392

		25			26,967			332,003			25,098			(40,297	)		343,796

Loss from operations		(25	)		(26,967	)		(25,331	)		(12,095	)		40,297			(24,121	)
Other
Loss from unconsolidated entities and non-performing loan portfolio								(2,816	)		(8,054	)					(10,870	)
Interest and other					26,967			(3,312	)		8,884			(29,032	)		3,507
Loss from subsidiaries		(31,459	)											31,459			—

Loss before income tax benefit		(31,484	)		—			(31,459	)		(11,265	)		42,724			(31,484	)
Income tax (benefit) provision		(10,711	)					(9,425	)		3,024			6,401			(10,711	)

Net loss		(20,773	)		—			(22,034	)		(14,289	)		36,323			(20,773	)

Condensed Consolidating Statement of Operations for the six months ended April 30, 2010 ($ in thousands):


	Toll									Non-
	Brothers,			Subsidiary			Guarantor			Guarantor
	Inc.			Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated

Revenues								614,819			23,150						637,969


Cost of revenues					484			588,752			34,295			(461	)		623,070
Selling, general and administrative		49			694			126,332			10,013			(10,266	)		126,822
Interest expense					53,158			13,464						(53,158	)		13,464

		49			54,336			728,548			44,308			(63,885	)		763,356

Loss from operations		(49	)		(54,336	)		(113,729	)		(21,158	)		63,885			(125,387	)
Other
Income from unconsolidated entities and non-performing loan portfolio								1,646									1,646
Interest and other					54,336			3,623			13,728			(56,455	)		15,232
Expenses related to retirement of debt								(34	)								(34	)
Loss from subsidiaries		(108,494	)											108,494

Loss before income tax benefit		(108,543	)		—			(108,494	)		(7,430	)		115,924			(108,543	)
Income tax benefit		(27,388	)					( 21,663	)		(1,837	)		23,500			(27,388	)

Net loss		(81,155	)		—			(86,831	)		(5,593	)		92,424			(81,155	)

Condensed Consolidating Statement of Operations for the three months ended April 30, 2010 ($ in thousands):


	Toll									Non-
	Brothers,			Subsidiary			Guarantor			Guarantor
	Inc.			Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated

Revenues								301,754			9,517						311,271


Cost of revenues					484			285,167			20,402			(470	)		305,583
Selling, general and administrative		27			346			59,252			4,883			(4,959	)		59,549
Interest expense					26,313			6,207						(26,313	)		6,207

		27			27,143			350,626			25,285			(31,742	)		371,339

Loss from operations		(27	)		(27,143	)		(48,872	)		(15,768	)		31,742			(60,068	)
Other
Income from unconsolidated entities and non-performing loan portfolio								1,280									1,280
Interest and other					27,143			(4,170	)		6,525			(22,499	)		6,999
Loss from subsidiaries		(51,762	)											51,762			—

Loss before income tax benefit		(51,789	)		—			(51,762	)		(9,243	)		61,005			(51,789	)
Income tax benefit		(11,388	)					(9,376	)		(2,391	)		11,767			(11,388	)

Net loss		(40,401	)		—			(42,386	)		(6,852	)		49,238			(40,401	)

Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2011 ($ in thousands):


	Toll									Non-
	Brothers,			Subsidiary			Guarantor			Guarantor
	Inc.			Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Cash flow from operating activities:
Net loss		(17,356	)					(16,694	)		(10,617	)		27,311			(17,356	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization		28			1,614			8,202			493						10,337
Stock-based compensation		7,970															7,970
Impairments of investments in unconsolidated entities								10,000			29,600						39,600
Income from unconsolidated entities and non-performing loan portfolio								(12,027	)		(5,701	)					(17,728	)
Distributions of earnings from unconsolidated entities								6,789									6,789
Inventory impairments								18,048									18,048
Deferred tax benefit		(6,515	)														(6,515	)
Deferred tax valuation allowance		6,515															6,515
Change in fair value of mortgage loans receivable and derivative instruments											818						818
Changes in operating assets and liabilities
Increase in inventory								(35,860	)		(118,580	)					(154,440	)
Origination of mortgage loans											(301,778	)					(301,778	)
Sale of mortgage loans											365,328						365,328
Decrease in restricted cash								28,781									28,781
Decrease (increase) in receivables, prepaid expenses and other assets		(116,822	)		(1,614	)		5,654			146,481			(26,527	)		7,172
Increase (decrease) in customer deposits								9,467			8,087						17,554
Decrease in accounts payable and accrued expenses		(1,456	)					(26,473	)		(8,086	)		(784	)		(36,799	)
Decrease in income tax refund recoverable		141,590															141,590
Decrease in income taxes payable		(18,241	)														(18,241	)

Net cash (used in) provided by operating activities		(4,287	)		—			(4,113	)		106,045			—			97,645

Cash flow from investing activities:
Purchase of property and equipment								(1,929	)		(3,183	)					(5,112	)
Purchase of marketable securities								(329,105	)								(329,105	)
Sale of marketable securities								227,080									227,080
Investments in and advances to unconsolidated entities and non-performing loan portfolio											(42,141	)					(42,141	)
Return of investments from unconsolidated entities								8,051			7,700						15,751

Net cash used in investing activities								(95,903	)		(37,624	)					(133,527	)

Cash flow from financing activities:
Proceeds from loans payable											438,713						438,713
Principal payments of loans payable								(7,709	)		(491,251	)					(498,960	)
Proceeds from stock-based benefit plans		4,676															4,676
Receipts related to noncontrolling interest											2,678						2,678
Purchase of treasury stock		(389	)														(389	)

Net cash (used in) provided by financing activities		4,287						(7,709	)		(49,860	)					(53,282	)

Net (decrease) increase in cash and cash equivalents		—			—			(107,725	)		18,561			—			(89,164	)
Cash and cash equivalents, beginning of period								930,387			108,673						1,039,060

Cash and cash equivalents, end of period		—			—			822,662			127,234			—			949,896

Condensed Consolidating Statement of Cash Flows for the six months ended April 30, 2010 ($ in thousands):


	Toll									Non-
	Brothers,			Subsidiary			Guarantor			Guarantor
	Inc.			Issuer			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Cash flow from operating activities:
Net loss		(81,155	)					(86,831	)		(5,593	)		92,424			(81,155	)
Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Depreciation and amortization					1,641			6,981			403						9,025
Stock-based compensation		7,350															7,350
Excess tax benefits from stock-based compensation		(2,606	)														(2,606	)
Income from unconsolidated entities and non-performing loan portfolio								(1,646	)								(1,646	)
Inventory impairments								67,962			7,750						75,712
Expenses related to early retirement of debt								34									34
Deferred tax benefit		(10,963	)														(10,963	)
Deferred tax valuation allowance		10,963															10,963
Change in fair value of mortgage loans receivable and derivative instruments											(266	)					(266	)
Changes in operating assets and liabilities
(Increase) decrease in inventory								(197,510	)		4,706						(192,804	)
Origination of mortgage loans											(241,631	)					(241,631	)
Sale of mortgage loans											238,071						238,071
Decrease (increase) in receivables, prepaid expenses and other assets		101,906			(9,553	)		32,503			(29,465	)		(92,305	)		3,086
(Decrease) increase in customer deposits								2,077			(8,484	)					(6,407	)
(Decrease) increase in accounts payable and accrued expenses		(1,492	)		7,912			(101,741	)		95,135			(119	)		(305	)
Increase in income tax refund recoverable		(38,740	)														(38,740	)
Decrease in current income taxes payable		8,389															8,389

Net cash (used in) provided by operating activities		(6,348	)		—			(278,171	)		60,626			—			(223,893	)

Cash flow from investing activities:
Purchase of property and equipment								(745	)		(3	)					(748	)
Purchase of marketable securities								(85,450	)								(85,450	)
Investments in and advances to unconsolidated entities and non-performing loan portfolio								(25,931	)								(25,931	)
Return of investments in unconsolidated entities								4,446									4,446

Net cash used in investing activities								(107,680	)		(3	)					(107,683	)

Cash flow from financing activities:
Redemption of senior subordinated notes								(47,872	)								(47,872	)
Proceeds from loans payable											346,472						346,472
Principal payments of loans payable								(14,159	)		(404,962	)					(419,121	)
Proceeds from stock-based benefit plans		4,124															4,124
Excess tax benefits from stock-based compensation		2,606															2,606
Purchase of treasury stock		(382	)														(382	)

Net cash (used in) provided by financing activities		6,348						(62,031	)		(58,490	)					(114,173	)

Net (decrease) increase in cash and cash equivalents		—			—			(447,882	)		2,133			—			(445,749	)
Cash and cash equivalents, beginning of period								1,700,351			107,367						1,807,718

Cash and cash equivalents, end of period		—			—			1,252,469			109,500			—			1,361,969

- Definition

Text block that encapsulates the detailed table comprising the condensed financial statements (balance sheet, income statement and statement of cash flows), normally using the registrant (parent) as the sole domain member. If condensed consolidating financial statements are being presented, other domain members (in addition to parent) such as guarantor subsidiaries, non-guarantor subsidiaries, and the consolidation eliminations, will be included in order that the respective monetary amounts for each of the domains will aggregate to the respective amounts on the consolidated financial statements. The line items are the various captions used to compile the condensed financial statements. Using extensions, most, if not all, of the elements representing condensed financial statement captions will be the same as those used for the consolidated financial statements captions.

+ References+ Details