0000799292-14-000011.txt : 20140424 0000799292-14-000011.hdr.sgml : 20140424 20140424083337 ACCESSION NUMBER: 0000799292-14-000011 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20140424 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20140424 DATE AS OF CHANGE: 20140424 FILER: COMPANY DATA: COMPANY CONFORMED NAME: M I HOMES INC CENTRAL INDEX KEY: 0000799292 STANDARD INDUSTRIAL CLASSIFICATION: OPERATIVE BUILDERS [1531] IRS NUMBER: 311210837 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-12434 FILM NUMBER: 14780250 BUSINESS ADDRESS: STREET 1: 3 EASTON OVAL STE 500 CITY: COLUMBUS STATE: OH ZIP: 43219 BUSINESS PHONE: 6144188000 FORMER COMPANY: FORMER CONFORMED NAME: M I SCHOTTENSTEIN HOMES INC DATE OF NAME CHANGE: 19931228 8-K 1 a8k1stqtrearnings4-24x14.htm 8-K 8K 1st Qtr Earnings 4-24-14


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


FORM 8-K


CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
 
Date of Report (Date of earliest event reported): April 24, 2014


 
M/I HOMES, INC.
 
 
(Exact name of registrant as specified in its charter)
 
 
 
 
 
 
 
 
 
Ohio
 
1-12434
 
31-1210837
 
 
(State or Other Jurisdiction
 
(Commission
 
(I.R.S. Employer
 
 
of Incorporation)
 
File Number)
 
Identification No.)
 
 


(614) 418-8000
(Telephone Number)

N/A
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

q Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
q Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a.12)
q Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
q Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))





SECTION 2 - FINANCIAL INFORMATION

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On April 24, 2014, M/I Homes, Inc. issued a press release reporting financial results for the three months ended March 31, 2014. A copy of this press release, including information concerning forward-looking statements and factors that may affect our future results, is attached hereto as Exhibit 99.1. The information in Exhibit 99.1 is furnished pursuant to Item 2.02 on Form 8-K.

Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(d) Exhibits:


Exhibit No.
 
Description of Documents
 
 
 
99.1
 
Press release dated April 24, 2014.





SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: April 24, 2014

M/I Homes, Inc.


By:
/s/Ann Marie W. Hunker
 
Ann Marie W. Hunker
 
Vice President and Corporate Controller
 
(Principal Accounting Officer)









Index to Exhibits

Exhibit No.
 
Description of Documents
 
 
 
99.1
 
Press release dated April 24, 2014.




 EX-99.1 2 mho-20140331xexh991.htm EXHIBIT 99.1 PRESS RELEASE MHO-2014.03.31-Exh 99.1


Exhibit 99.1


M/I Homes Reports
First Quarter Results


Columbus, Ohio (April 24, 2014) - M/I Homes, Inc. (NYSE:MHO) announced results for the first quarter ended March 31, 2014.

2014 First Quarter Highlights:
•
Pre-tax income of $12.5 million - a 156% increase over 2013’s first quarter
•
Net income of $12.6 million, including a $5.3 million benefit from the reversal
of a portion of our state deferred tax asset valuation allowance
•
Diluted earnings per share of $0.41 ($0.23 per share excluding the impact
of the state deferred tax valuation allowance reversal)
•
Homes delivered increased 18%; New contracts declined 6%
•
Backlog sales value and units increased 24% and 10%, respectively
•
Cash balance of $101 million
•
Net debt to net capital ratio of 39%
 
For the first quarter, the Company reported net income of $12.6 million, or $0.41 per diluted share. Excluding the reversal of $5.3 million of our state deferred tax asset valuation allowance, the Company’s net income totaled $7.3 million or $0.23 per diluted share. This compares to $4.6 million, or $0.11 per share during the first quarter of 2013.

Homes delivered in the first quarter were 737, an increase of 18% from the 627 reported for the same period of 2013. New contracts for the first quarter were 982, a 6% decrease from the 1,047 recorded in 2013's first quarter. The backlog of homes at March 31, 2014 had a total sales value of $496 million, a 24% increase over a year-ago, with backlog units of 1,525 and an average sales price of $326,000. At March 31, 2013 backlog sales value was $401 million, with backlog units of 1,385 and an average sales price of $290,000. M/I Homes had 158 active communities at March 31, 2014 compared to 135 at March 31, 2013 and 157 at December 31, 2013. The Company's cancellation rate was 16% in the first quarter of 2014 compared to 15% in 2013's first quarter.

Robert H. Schottenstein, Chief Executive Officer and President, commented, “We had a very solid first quarter highlighted by an 18% increase in homes delivered, 23% growth in revenue, 156% improvement in pre-tax income and our gross margin improving to 21.7%, a 180 basis point increase over the fourth quarter of 2013. At the same time, our results were a bit mixed, with new contracts declining by 6%, in part due to unusually harsh winter weather conditions, but also due to a softer than expected start to the spring selling season.”

Mr. Schottenstein continued, “Our financial condition is strong, with cash of $101 million at the end of the quarter, shareholders' equity of $507 million, net debt to net capital at 39%, and no outstanding borrowings under our $200 million credit facility. Looking ahead, with the strength of our backlog and planned new community openings, we are poised to have a very solid 2014. We remain focused on increasing our profitability, continuing to grow our market share and investing in attractive land opportunities.”





The Company will broadcast live its earnings conference call today at 4:00 p.m. Eastern Time. To listen to the call live, log on to the M/I Homes' website at mihomes.com, click on the “Investors” section of the site, and select “Listen to the Conference Call.” A replay of the call will continue to be available on our website through April 2015.

M/I Homes, Inc. is one of the nation's leading builders of single-family homes, having delivered over 87,400 homes. The Company's homes are marketed and sold under the trade names M/I Homes, Showcase Collection (exclusively by M/I), and Triumph Homes. The Company has homebuilding operations in Columbus and Cincinnati, Ohio; Chicago, Illinois; Indianapolis, Indiana; Tampa and Orlando, Florida; Austin, Dallas/Ft Worth, Houston and San Antonio, Texas; Charlotte and Raleigh, North Carolina; and the Virginia and Maryland suburbs of Washington, D.C.

Certain statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “expects,” “anticipates,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. These statements involve a number of risks and uncertainties. Any forward-looking statements that we make herein and in future reports and statements are not guarantees of future performance, and actual results may differ materially from those in such forward-looking statements as a result of various factors, including, without limitation, factors relating to the economic environment, interest rates, availability of resources, competition, market concentration, land development activities and various governmental rules and regulations, as more fully discussed in the Risk Factors section in the Company's Annual Report on Form 10-K for the year ended December 31, 2013, as the same may be updated from time to time in our subsequent filings with the Securities and Exchange Commission. All forward-looking statements made in this press release are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed in this press release will increase with the passage of time. The Company undertakes no duty to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in our subsequent filings, releases or presentations should be consulted.

In this press release, we use adjusted EBITDA, a non-GAAP financial measure. Please see the “Non-GAAP Financial Results / Reconciliation” table below.

Contact M/I Homes, Inc.
Phillip G. Creek, Executive Vice President, Chief Financial Officer, (614) 418-8011
Kevin C. Hake, Senior Vice President, Treasurer (614) 418-8227
Ann Marie W. Hunker, Vice President, Controller, (614) 418-8225














M/I Homes, Inc. and Subsidiaries
Summary Operating Results (Unaudited)
(Dollars in thousands, except per share amounts)

 
Three Months Ended
 
March 31,
 
2014
 
2013
New contracts
982

 
1,047

Average community count
158

 
133

Cancellation rate
16
%
 
15
%
Backlog units
1,525

 
1,385

Backlog value
$
496,428

 
$
401,186

Homes delivered
737

 
627

Average home closing price
$
299

 
$
284

 
 
 
 
Homebuilding revenue:
 
 
 
   Housing revenue
$
220,710

 
$
177,790

   Land revenue
6,266

 
4,527

Total homebuilding revenue
$
226,976

 
$
182,317

 
 
 
 
Financial services revenue
7,865

 
8,410

 
 
 
 
Total revenue
$
234,841

 
$
190,727

 
 
 
 
Cost of sales - operations
183,964

 
151,513

Cost of sales - impairment
—

 
900

Gross margin
50,877

 
38,314

General and administrative expense
18,315

 
15,979

Selling expense
15,969

 
13,109

Operating income
16,593

 
9,226

Income from unconsolidated joint ventures
(62
)
 
—

Interest expense
4,170

 
4,340

Income before income taxes
12,485

 
4,886

(Benefit) provision for income taxes
(147
)
 
299

Net income
$
12,632

 
$
4,587

Excess of fair value over book value of preferred shares redeemed
$
—

 
$
2,190

Preferred dividends
$
1,219

 
$
—

Net income to common shareholders
$
11,413

 
$
2,397

 
 
 
 
Earnings per share:
 
 
 
Basic
$
0.47

 
$
0.11

Diluted
$
0.41

 
$
0.11

 
 
 
 
Weighted average shares outstanding:
 
 
 
Basic
24,417

 
22,273

Diluted
29,870

 
22,688





M/I Homes, Inc. and Subsidiaries
Summary Balance Sheet and Other Information (unaudited)
(Dollars in thousands, except per share amounts)

 
As of
 
March 31,
 
2014
 
2013
Assets:
 
 
 
Total cash and cash equivalents(1)
$
100,911

 
$
272,551

Mortgage loans held for sale
55,750

 
57,721

Inventory:
 
 
 
Lots, land and land development
337,137

 
255,934

Land held for sale
3,623

 
8,591

Homes under construction
325,439

 
245,074

Other inventory
57,428

 
68,041

Total inventory
$
723,627

 
$
577,640

 
 
 
 
Property and equipment - net
10,506

 
9,994

Investments in unconsolidated joint ventures
44,847

 
22,275

Deferred income taxes, net of valuation allowance(2)
111,214

 
—

Other assets
38,048

 
28,471

Total Assets
$
1,084,903

 
$
968,652

 
 
 
 
Liabilities:
 
 
 
Debt - Homebuilding Operations:
 
 
 
Senior notes
$
228,169

 
$
227,770

Convertible senior subordinated notes due 2017
57,500

 
57,500

 Convertible senior subordinated notes due 2018
86,250

 
86,250

 Preferred stock - subject to redemption
—

 
50,352

Notes payable - other
7,757

 
10,316

Total Debt - Homebuilding Operations
$
379,676

 
$
432,188

 
 
 
 
Note payable bank - financial services operations
51,532

 
53,126

Total Debt
$
431,208

 
$
485,314

 
 
 
 
Accounts payable
71,376

 
57,071

Other liabilities
75,728

 
81,266

Total Liabilities
$
578,312

 
$
623,651

 
 
 
 
Shareholders' Equity
506,591

 
345,001

Total Liabilities and Shareholders' Equity
$
1,084,903

 
$
968,652

 
 
 
 
Book value per common share
$
18.66

 
$
12.20

Net debt/net capital ratio(3)
39
%
 
38
%
(1)
2014 and 2013 amounts include $11.6 million and $9.5 million of restricted cash and cash held in escrow, respectively.
(2)
2014 and 2013 amounts include gross deferred tax assets of $115.2 million and $134.0 million, respectively, net of valuation allowances of $4.0 million and $134.0 million, respectively.
(3)
Net debt/net capital ratio is calculated as total debt minus total cash and cash equivalents, divided by the sum of total debt minus total cash and cash equivalents plus shareholders' equity.




M/I Homes, Inc. and Subsidiaries
Selected Supplemental Financial and Operating Data
(Dollars in thousands)
 
Three Months Ended
 
March 31,
 
2014
 
2013
Adjusted EBITDA(1)
$
22,176

 
$
16,026

 
 
 
 
Cash flow (used in) provided by operating activities
$
(2,103
)
 
$
8,558

Cash used in investing activities
$
(8,879
)
 
$
(12,702
)
Cash (used in) provided by financing activities
$
(28,383
)
 
$
121,703

 
 
 
 
Land/lot purchases
$
53,003

 
$
44,381

Land development spending
$
17,530

 
$
15,728

Land gross margin
$
1,321

 
$
991

 
 
 
 
Financial services pre-tax income
$
4,711

 
$
5,137

 
 
 
 
Deferred tax expense
$
5,024

 
$
1,788

Deferred tax asset valuation benefit
$
(5,327
)
 
$
(1,788
)
(1)
See "Non-GAAP Financial Results / Reconciliation" table below.


M/I Homes, Inc. and Subsidiaries
Non-GAAP Financial Results / Reconciliation
(Dollars in thousands)
 
Three Months Ended
 
March 31,
 
2014
 
2013
Net income
$
12,632

 
$
4,587

Add:
 
 
 
(Benefit) provision for income taxes
(147
)
 
299

Interest expense net of interest income
3,777

 
4,055

Interest amortized to cost of sales
3,108

 
3,528

Depreciation and amortization
1,912

 
2,138

Non-cash charges
894

 
1,419

Adjusted EBITDA
$
22,176

 
$
16,026








M/I Homes, Inc. and Subsidiaries
Selected Supplemental Financial and Operating Data

NEW CONTRACTS
 
Three Months Ended
 
March 31,
 
 
 
 
 
%
Region
2014
 
2013
 
Change
Midwest
374

 
349

 
7
 %
Southern
336

 
378

 
(11
)%
Mid-Atlantic
272

 
320

 
(15
)%
Total
982

 
1,047

 
(6
)%

HOMES DELIVERED
 
Three Months Ended
 
March 31,
 
 
 
 
 
%
Region
2014
 
2013
 
Change
Midwest
259

 
232

 
12
 %
Southern
275

 
191

 
44
 %
Mid-Atlantic
203

 
204

 
—
 %
Total
737

 
627

 
18
 %

BACKLOG
 
March 31, 2014
 
March 31, 2013
 
 
 
Dollars
 
Average
 
 
 
Dollars
 
Average
Region
Units
 
(millions)
 
Sales Price
 
Units
 
(millions)
 
Sales Price
Midwest
660

 
$
209

 
$
317,000

 
535

 
$
144

 
$
270,000

Southern
510

 
$
169

 
$
331,000

 
528

 
$
148

 
$
280,000

Mid-Atlantic
355

 
$
118

 
$
334,000

 
322

 
$
109

 
$
339,000

Total
1,525

 
$
496

 
$
326,000

 
1,385

 
$
401

 
$
290,000


LAND POSITION SUMMARY
 
March 31, 2014
 
 
March 31, 2013
 
Lots
Lots Under
 
 
 
Lots
Lots Under
 
Region
Owned
Contract
Total
 
 
Owned
Contract
Total
Midwest
3,532

2,609

6,141

 
 
3,078

2,989

6,067

Southern
4,823

4,306

9,129

 
 
2,693

3,800

6,493

Mid-Atlantic
2,287

3,408

5,695

 
 
1,685

2,124

3,809

Total
10,642

10,323

20,965

 
 
7,456

8,913

16,369




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