Supplemental Guarantor Information

9 Months Ended

Sep. 30, 2019

Supplemental Guarantor Information [Abstract]

Condensed Financial Information of Parent Company Only Disclosure [Text Block]

Supplemental Guarantor Information

The Company’s obligations under the 2025 Senior Notes and the 2021 Senior Notes are not guaranteed by all of the Company’s subsidiaries and, therefore, the Company has disclosed condensed consolidating financial information in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered. The Guarantor Subsidiaries of the 2025 Senior Notes and the 2021 Senior Notes are the same.

The following condensed consolidating financial information includes balance sheets, statements of income and cash flow information for M/I Homes, Inc. (the parent company and the issuer of the aforementioned guaranteed notes), the Guarantor Subsidiaries, collectively, and for all other subsidiaries and joint ventures of the Company (the “Unrestricted Subsidiaries”), collectively. Each Guarantor Subsidiary is a direct or indirect 100%-owned subsidiary of M/I Homes, Inc. and has fully and unconditionally guaranteed the (1) 2025 Senior Notes on a joint and several senior unsecured basis and (2) 2021 Senior Notes on a joint and several senior unsecured basis.

There are no significant restrictions on the parent company’s ability to obtain funds from its Guarantor Subsidiaries in the form of a dividend, loan, or other means.

As of September 30, 2019, each of the Company’s subsidiaries is a Guarantor Subsidiary, with the exception of subsidiaries that are primarily engaged in the business of mortgage financing, title insurance or similar financial businesses relating to the homebuilding and home sales business, certain subsidiaries that are not 100%-owned by the Company or another subsidiary, and other subsidiaries designated by the Company as Unrestricted Subsidiaries, subject to limitations on the aggregate amount invested in such Unrestricted Subsidiaries in accordance with the terms of the Credit Facility and the indenture governing the 2025 Senior Notes and the indenture governing the 2021 Senior Notes.

In the condensed financial tables presented below, the parent company presents all of its 100%-owned subsidiaries as if they were accounted for under the equity method. All applicable corporate expenses have been allocated appropriately among the Guarantor Subsidiaries and Unrestricted Subsidiaries.

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF INCOME
	Three Months Ended September 30, 2019
(In thousands)	M/I Homes, Inc.		Guarantor Subsidiaries		Unrestricted Subsidiaries			Eliminations			Consolidated
Revenue	$	—	$	639,891	$	13,454		$	—		$	653,345
Costs and expenses:
Land and housing	—		519,164		—			—			519,164
General and administrative	—		32,332		7,053			—			39,385
Selling	—		40,147		—			—			40,147
Equity in income from joint venture arrangements	—		—		(52		)	—			(52		)
Interest	—		3,650		987			—			4,637
Total costs and expenses	—		595,293		7,988			—			603,281
Income before income taxes	—		44,598		5,466			—			50,064
Provision for income taxes	—		11,222		1,004			—			12,226
Equity in subsidiaries	37,838		—		—			(37,838		)	—
Net income	$	37,838	$	33,376	$	4,462		$	(37,838	)	$	37,838

	Three Months Ended September 30, 2018
(In thousands)	M/I Homes, Inc.		Guarantor Subsidiaries		Unrestricted Subsidiaries			Eliminations			Consolidated
Revenue	$	—	$	555,649	$	12,193		$	—		$	567,842
Costs and expenses:
Land and housing	—		452,029		—			—			452,029
General and administrative	—		30,180		6,717			—			36,897
Selling	—		35,054		—			—			35,054
Equity in income from joint venture arrangements	—		—		(44		)	—			(44		)
Interest	—		3,592		834			—			4,426
Total costs and expenses	—		520,855		7,507			—			528,362
Income before income taxes	—		34,794		4,686			—			39,480
Provision for income taxes	—		9,253		945			—			10,198
Equity in subsidiaries	29,282		—		—			(29,282		)	—
Net income	$	29,282	$	25,541	$	3,741		$	(29,282	)	$	29,282

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF INCOME
	Nine Months Ended September 30, 2019
(In thousands)	M/I Homes, Inc.		Guarantor Subsidiaries		Unrestricted Subsidiaries			Eliminations			Consolidated
Revenue	$	—	$	1,718,600	$	39,540		$	—		$	1,758,140
Costs and expenses:
Land and housing	—		1,411,488		—			—			1,411,488
General and administrative	—		86,080		20,168			—			106,248
Selling	—		109,150		—			—			109,150
Equity in income from joint venture arrangements	—		—		(118		)	—			(118		)
Interest	—		13,962		2,664			—			16,626
Total costs and expenses	—		1,620,680		22,714			—			1,643,394
Income before income taxes	—		97,920		16,826			—			114,746
Provision for income taxes	—		25,555		3,384			—			28,939
Equity in subsidiaries	85,807		—		—			(85,807		)	—
Net income	$	85,807	$	72,365	$	13,442		$	(85,807	)	$	85,807

	Nine Months Ended September 30, 2018
(In thousands)	M/I Homes, Inc.		Guarantor Subsidiaries		Unrestricted Subsidiaries			Eliminations			Consolidated
Revenue	$	—	$	1,524,702	$	39,095		$	—		$	1,563,797
Costs and expenses:
Land and housing	—		1,250,067		—			—			1,250,067
General and administrative	—		80,921		18,593			—			99,514
Selling	—		100,708		—			—			100,708
Acquisition and integration costs	—		1,700		—			—			1,700
Equity in income from joint venture arrangements	—		—		(268		)	—			(268		)
Interest	—		12,893		2,299			—			15,192
Total costs and expenses	—		1,446,289		20,624			—			1,466,913
Income before income taxes	—		78,413		18,471			—			96,884
Provision for income taxes	—		17,711		3,917			—			21,628
Equity in subsidiaries	75,256		—		—			(75,256		)	—
Net income	$	75,256	$	60,702	$	14,554		$	(75,256	)	$	75,256

UNAUDITED CONDENSED CONSOLIDATING BALANCE SHEET
	September 30, 2019
(In thousands)	M/I Homes, Inc.		Guarantor Subsidiaries		Unrestricted Subsidiaries		Eliminations			Consolidated
ASSETS:
Cash, cash equivalents and restricted cash	$	—	$	19,366	$	14,085	$	—		$	33,451
Mortgage loans held for sale	—		—		128,322		—			128,322
Inventory	—		1,827,068		—		—			1,827,068
Property and equipment - net	—		26,794		827		—			27,621
Investment in joint venture arrangements	—		44,946		2,611		—			47,557
Operating lease right-of-use assets	—		15,716		3,343		—			19,059
Deferred income tax asset	—		11,988		—		—			11,988
Investment in subsidiaries	894,263		—		—		(894,263		)	—
Intercompany assets	604,413		—		—		(604,413		)	—
Goodwill	—		16,400		—		—			16,400
Other assets	1,639		56,200		12,298		—			70,137
TOTAL ASSETS	$	1,500,315	$	2,018,478	$	161,486	$	(1,498,676	)	$	2,181,603
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES:
Accounts payable	$	—	$	168,950	$	578	$	—		$	169,528
Customer deposits	—		36,250		—		—			36,250
Operating lease liabilities	—		15,718		3,341		—			19,059
Intercompany liabilities	—		600,611		3,802		(604,413		)	—
Other liabilities	—		126,285		5,149		—			131,434
Community development district obligations	—		14,328		—		—			14,328
Obligation for consolidated inventory not owned	—		6,687		—		—			6,687
Notes payable bank - homebuilding operations	—		189,900		—		—			189,900
Notes payable bank - financial services operations	—		—		108,594		—			108,594
Notes payable - other	—		5,508		—		—			5,508
Senior notes due 2021 - net	298,712		—		—		—			298,712
Senior notes due 2025 - net	246,962		—		—		—			246,962
TOTAL LIABILITIES	545,674		1,164,237		121,464		(604,413		)	1,226,962
SHAREHOLDERS’ EQUITY	954,641		854,241		40,022		(894,263		)	954,641
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,500,315	$	2,018,478	$	161,486	$	(1,498,676	)	$	2,181,603

CONDENSED CONSOLIDATING BALANCE SHEET
	December 31, 2018
(In thousands)	M/I Homes, Inc.		Guarantor Subsidiaries		Unrestricted Subsidiaries		Eliminations			Consolidated
ASSETS:
Cash, cash equivalents and restricted cash	$	—	$	5,554	$	15,975	$	—		$	21,529
Mortgage loans held for sale	—		—		169,651		—			169,651
Inventory	—		1,674,460		—		—			1,674,460
Property and equipment - net	—		28,485		910		—			29,395
Investment in joint venture arrangements	—		33,297		2,573		—			35,870
Deferred income tax asset	—		13,482		—		—			13,482
Investment in subsidiaries	817,986		—		—		(817,986		)	—
Intercompany assets	579,447		—		—		(579,447		)	—
Goodwill	—		16,400		—		—			16,400
Other assets	2,325		47,738		10,731		—			60,794
TOTAL ASSETS	$	1,399,758	$	1,819,416	$	199,840	$	(1,397,433	)	$	2,021,581
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES:
Accounts payable	$	—	$	131,089	$	422	$	—		$	131,511
Customer deposits	—		32,055		—		—			32,055
Intercompany liabilities	—		578,498		949		(579,447		)	—
Other liabilities	—		140,860		9,191		—			150,051
Community development district obligations	—		12,392		—		—			12,392
Obligation for consolidated inventory not owned	—		19,308		—		—			19,308
Notes payable bank - homebuilding operations	—		117,400		—		—			117,400
Notes payable bank - financial services operations	—		—		153,168		—			153,168
Notes payable - other	—		5,938		—		—			5,938
Senior notes due 2021 - net	297,884		—		—		—			297,884
Senior notes due 2025 - net	246,571		—		—		—			246,571
TOTAL LIABILITIES	544,455		1,037,540		163,730		(579,447		)	1,166,278
SHAREHOLDERS’ EQUITY	855,303		781,876		36,110		(817,986		)	855,303
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,399,758	$	1,819,416	$	199,840	$	(1,397,433	)	$	2,021,581

UNAUDITED CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS
	Nine Months Ended September 30, 2019
(In thousands)	M/I Homes, Inc.			Guarantor Subsidiaries			Unrestricted Subsidiaries			Eliminations			Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	9,530		$	(48,625	)	$	49,602		$	(9,530	)	$	977
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment	—			(2,438		)	(188		)	—			(2,626		)
Return of capital from unconsolidated joint ventures	—			—			438			—			438
Intercompany investing	(18,728		)	—			—			18,728			—
Investments in and advances to joint venture arrangements	—			(23,351		)	(171		)	—			(23,522		)
Net cash (used in) provided by investing activities	(18,728		)	(25,789		)	79			18,728			(25,710		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from bank borrowings - homebuilding operations	—			568,900			—			—			568,900
Principal repayments of bank borrowings - homebuilding operations	—			(496,400		)	—			—			(496,400		)
Net repayments of bank borrowings - financial services operations	—			—			(44,574		)	—			(44,574		)
Principal repayment of notes payable - other and CDD bond obligations	—			(429		)	—			—			(429		)
Intercompany financing	—			16,155			2,573			(18,728		)	—
Repurchase of common shares	(5,150		)	—			—			—			(5,150		)
Dividends paid	—			—			(9,530		)	9,530			—
Debt issue costs	—			—			(40		)	—			(40		)
Proceeds from exercise of stock options	14,348			—			—			—			14,348
Net cash provided by (used in) financing activities	9,198			88,226			(51,571		)	(9,198		)	36,655
Net increase (decrease) in cash, cash equivalents and restricted cash	—			13,812			(1,890		)	—			11,922
Cash, cash equivalents and restricted cash balance at beginning of period	—			5,554			15,975			—			21,529
Cash, cash equivalents and restricted cash balance at end of period	$	—		$	19,366		$	14,085		$	—		$	33,451

	Nine Months Ended September 30, 2018
(In thousands)	M/I Homes, Inc.			Guarantor Subsidiaries			Unrestricted Subsidiaries			Eliminations			Consolidated
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities	$	11,700		$	(144,828	)	$	69,709		$	(11,700	)	$	(75,119	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment	—			(5,636		)	(230		)	—			(5,866		)
Return of capital from unconsolidated joint ventures	—			—			676			—			676
Acquisition, net of cash acquired	—			(100,960		)	—			—			(100,960		)
Intercompany Investing	(1,041		)	—			—			1,041			—
Investments in and advances to joint venture arrangements	—			(19,412		)	(1,075		)	—			(20,487		)
Proceeds from the sale of mortgage servicing rights	—			—			6,335			—			6,335
Net cash (used in) provided by investing activities	(1,041		)	(126,008		)	5,706			1,041			(120,302		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of convertible senior subordinated notes due 2018	—			(65,941		)	—			—			(65,941		)
Proceeds from bank borrowings - homebuilding operations	—			519,900			—			—			519,900
Principal repayments of bank borrowings - homebuilding operations	—			(297,200		)	—			—			(297,200		)
Net repayments of bank borrowings - financial services operations	—			—			(64,169		)	—			(64,169		)
Principal repayments of notes payable - other and CDD bond obligations	—			(1,738		)	—			—			(1,738		)
Intercompany financing	—			5,862			(4,821		)	(1,041		)	—
Repurchase of common shares	(11,085		)	—			—			—			(11,085		)
Dividends paid	—			—			(11,700		)	11,700			—
Debt issue costs	—			(75		)	(40		)	—			(115		)
Proceeds from exercise of stock options	426			—			—			—			426
Net cash (used in) provided by financing activities	(10,659		)	160,808			(80,730		)	10,659			80,078
Net decrease in cash, cash equivalents and restricted cash	—			(110,028		)	(5,315		)	—			(115,343		)
Cash, cash equivalents and restricted cash balance at beginning of period	—			131,522			20,181			—			151,703
Cash, cash equivalents and restricted cash balance at end of period	$	—		$	21,494		$	14,866		$	—		$	36,360