CURRENT REPORT |
PURSUANT TO SECTION 13 OR 15(D) |
OF THE SECURITIES EXCHANGE ACT OF 1934 |
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) |
Exhibit No. | Description of Documents | |
99.1 | Press release dated July 24, 2014. |
By: | /s/Ann Marie W. Hunker |
Ann Marie W. Hunker | |
Vice President and Corporate Controller | |
(Principal Accounting Officer) |
Exhibit No. | Description of Documents | |
99.1 | Press release dated July 24, 2014. |
• | Pre-tax income of $15.3 million, an increase of 107% over 2013’s second quarter’s $7.4 million |
• | Net income of $13.6 million, including a $4.0 million benefit from the reversal |
• | Diluted earnings per share of $0.44 ($0.31 per share excluding the impact of the |
• | Homes delivered increased 13%; New contracts declined 6% |
• | Revenue increased 20% |
• | Backlog sales value increased 11% |
• | Cash balance of $43.7 million |
• | Net debt to net capital ratio of 43% |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
New contracts | 1,016 | 1,078 | 1,998 | 2,125 | |||||||||||
Average community count | 152 | 138 | 155 | 135 | |||||||||||
Cancellation rate | 15 | % | 14 | % | 15 | % | 15 | % | |||||||
Backlog units | 1,647 | 1,675 | |||||||||||||
Backlog value | $ | 546,221 | $ | 490,769 | |||||||||||
Homes delivered | 894 | 788 | 1,631 | 1,415 | |||||||||||
Average home closing price | $ | 306 | $ | 281 | $ | 303 | $ | 282 | |||||||
Homebuilding revenue: | |||||||||||||||
Housing revenue | $ | 273,374 | $ | 221,700 | $ | 494,084 | $ | 399,490 | |||||||
Land revenue | 1,764 | 5,601 | 8,030 | 10,128 | |||||||||||
Total homebuilding revenue | $ | 275,138 | $ | 227,301 | $ | 502,114 | $ | 409,618 | |||||||
Financial services revenue | 6,470 | 7,252 | 14,335 | 15,662 | |||||||||||
Total revenue | $ | 281,608 | $ | 234,553 | $ | 516,449 | $ | 425,280 | |||||||
Cost of sales - operations | 221,217 | 187,136 | 405,181 | 338,649 | |||||||||||
Cost of sales - impairment | 804 | 1,201 | 804 | 2,101 | |||||||||||
Gross margin | 59,587 | 46,216 | 110,464 | 84,530 | |||||||||||
General and administrative expense | 21,281 | 18,149 | 39,596 | 34,128 | |||||||||||
Selling expense | 20,251 | 16,275 | 36,220 | 29,384 | |||||||||||
Operating income | 18,055 | 11,792 | 34,648 | 21,018 | |||||||||||
Loss (income) from unconsolidated joint ventures | 22 | — | (40 | ) | — | ||||||||||
Interest expense | 2,730 | 4,397 | 6,900 | 8,737 | |||||||||||
Income before income taxes | 15,303 | 7,395 | 27,788 | 12,281 | |||||||||||
Provision for income taxes | 1,749 | 131 | 1,602 | 430 | |||||||||||
Net income | $ | 13,554 | $ | 7,264 | $ | 26,186 | $ | 11,851 | |||||||
Excess of fair value over book value of preferred shares redeemed | $ | — | $ | — | $ | — | $ | 2,190 | |||||||
Preferred dividends | $ | 1,219 | $ | 1,219 | $ | 2,438 | $ | 1,219 | |||||||
Net income to common shareholders | $ | 12,335 | $ | 6,045 | $ | 23,748 | $ | 8,442 | |||||||
Earnings per share: | |||||||||||||||
Basic | $ | 0.50 | $ | 0.25 | $ | 0.97 | $ | 0.36 | |||||||
Diluted | $ | 0.44 | $ | 0.25 | $ | 0.85 | $ | 0.36 | |||||||
Weighted average shares outstanding: | |||||||||||||||
Basic | 24,470 | 24,271 | 24,444 | 23,278 | |||||||||||
Diluted | 29,913 | 24,646 | 29,891 | 23,671 |
As of | |||||||
June 30, | |||||||
2014 | 2013 | ||||||
Assets: | |||||||
Total cash and cash equivalents(1) | $ | 43,719 | $ | 178,730 | |||
Mortgage loans held for sale | 64,782 | 51,491 | |||||
Inventory: | |||||||
Lots, land and land development | 366,945 | 261,985 | |||||
Land held for sale | 3,450 | 6,389 | |||||
Homes under construction | 384,930 | 294,234 | |||||
Other inventory | 60,815 | 52,391 | |||||
Total inventory | $ | 816,140 | $ | 614,999 | |||
Property and equipment - net | 11,283 | 10,267 | |||||
Investments in unconsolidated joint ventures | 42,182 | 28,648 | |||||
Deferred income taxes, net of valuation allowance(2) | 109,558 | — | |||||
Other assets | 39,042 | 34,131 | |||||
Total Assets | $ | 1,126,706 | $ | 918,266 | |||
Liabilities: | |||||||
Debt - Homebuilding Operations: | |||||||
Senior notes | $ | 228,269 | $ | 227,870 | |||
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 | — | — | |||||
Notes payable - other | 7,717 | 9,429 | |||||
Total Debt - Homebuilding Operations | $ | 379,736 | $ | 381,049 | |||
Note payable bank - financial services operations | 61,914 | 50,442 | |||||
Total Debt | $ | 441,650 | $ | 431,491 | |||
Accounts payable | 87,325 | 61,888 | |||||
Other liabilities | 77,587 | 70,353 | |||||
Total Liabilities | $ | 606,562 | $ | 563,732 | |||
Shareholders' Equity | 520,144 | 354,534 | |||||
Total Liabilities and Shareholders' Equity | $ | 1,126,706 | $ | 918,266 | |||
Book value per common share | $ | 19.21 | $ | 12.50 | |||
Net debt/net capital ratio(3) | 43 | % | 42 | % |
(1) | 2014 and 2013 amounts include $10.1 million and $12.5 million of restricted cash and cash held in escrow, respectively. |
(2) | 2013 amounts include gross deferred tax assets of $131.3 million net of a valuation allowance of $131.3. |
(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. |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Adjusted EBITDA(1) | $ | 25,601 | $ | 19,379 | $ | 47,777 | $ | 35,405 | |||||||
Cash flow used in operating activities | $ | (64,566 | ) | $ | (33,736 | ) | $ | (66,669 | ) | $ | (25,178 | ) | |||
Cash used in investing activities | $ | (328 | ) | $ | (10,505 | ) | $ | (9,207 | ) | $ | (23,207 | ) | |||
Cash provided by (used in) financing activities | $ | 9,177 | $ | (52,564 | ) | $ | (19,206 | ) | $ | 69,139 | |||||
Land/lot purchases | $ | 71,880 | $ | 55,810 | $ | 124,883 | $ | 100,219 | |||||||
Land development spending | $ | 34,408 | $ | 20,620 | $ | 51,938 | $ | 36,348 | |||||||
Land gross margin | $ | 442 | $ | 297 | $ | 1,763 | $ | 1,288 | |||||||
Financial services pre-tax income | $ | 3,072 | $ | 3,835 | $ | 7,783 | $ | 8,971 |
(1) | See "Non-GAAP Financial Results / Reconciliation" table below. |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Net income | $ | 13,554 | $ | 7,264 | $ | 26,186 | $ | 11,851 | |||||||
Add: | |||||||||||||||
Provision for income taxes | 1,749 | 131 | 1,602 | 430 | |||||||||||
Interest expense net of interest income | 2,352 | 4,112 | 6,129 | 8,167 | |||||||||||
Interest amortized to cost of sales | 3,843 | 3,693 | 6,951 | 7,221 | |||||||||||
Depreciation and amortization | 2,037 | 2,181 | 3,949 | 4,319 | |||||||||||
Non-cash charges | 2,066 | 1,998 | 2,960 | 3,417 | |||||||||||
Adjusted EBITDA | $ | 25,601 | $ | 19,379 | $ | 47,777 | $ | 35,405 |
NEW CONTRACTS | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, | June 30, | ||||||||||||||||
% | % | ||||||||||||||||
Region | 2014 | 2013 | Change | 2014 | 2013 | Change | |||||||||||
Midwest | 394 | 395 | — | % | 768 | 744 | 3 | % | |||||||||
Southern | 363 | 376 | (3 | )% | 699 | 754 | (7 | )% | |||||||||
Mid-Atlantic | 259 | 307 | (16 | )% | 531 | 627 | (15 | )% | |||||||||
Total | 1,016 | 1,078 | (6 | )% | 1,998 | 2,125 | (6 | )% |
HOMES DELIVERED | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||
June 30, | June 30, | ||||||||||||||||
% | % | ||||||||||||||||
Region | 2014 | 2013 | Change | 2014 | 2013 | Change | |||||||||||
Midwest | 291 | 298 | (2 | )% | 550 | 530 | 4 | % | |||||||||
Southern | 330 | 249 | 33 | % | 605 | 440 | 38 | % | |||||||||
Mid-Atlantic | 273 | 241 | 13 | % | 476 | 445 | 7 | % | |||||||||
Total | 894 | 788 | 13 | % | 1,631 | 1,415 | 15 | % |
BACKLOG | |||||||||||||||||||||
June 30, 2014 | June 30, 2013 | ||||||||||||||||||||
Dollars | Average | Dollars | Average | ||||||||||||||||||
Region | Units | (millions) | Sales Price | Units | (millions) | Sales Price | |||||||||||||||
Midwest | 763 | $ | 247 | $ | 324,000 | 632 | $ | 178 | $ | 282,000 | |||||||||||
Southern | 543 | $ | 182 | $ | 336,000 | 655 | $ | 180 | $ | 275,000 | |||||||||||
Mid-Atlantic | 341 | $ | 117 | $ | 343,000 | 388 | $ | 132 | $ | 340,000 | |||||||||||
Total | 1,647 | $ | 546 | $ | 332,000 | 1,675 | $ | 491 | $ | 293,000 |
LAND POSITION SUMMARY | ||||||||||||||
June 30, 2014 | June 30, 2013 | |||||||||||||
Lots | Lots Under | Lots | Lots Under | |||||||||||
Region | Owned | Contract | Total | Owned | Contract | Total | ||||||||
Midwest | 3,342 | 2,688 | 6,030 | 3,403 | 2,550 | 5,953 | ||||||||
Southern | 5,003 | 4,143 | 9,146 | 3,648 | 3,372 | 7,020 | ||||||||
Mid-Atlantic | 2,582 | 3,233 | 5,815 | 1,625 | 2,565 | 4,190 | ||||||||
Total | 10,927 | 10,064 | 20,991 | 8,676 | 8,487 | 17,163 |
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