Business Segments Business Segments (Tables)

9 Months Ended

Sep. 30, 2019

Schedule of Segment Reporting Information, by Segment [Table Text Block]

The following table shows, by segment: revenue, operating income and interest expense for the three and nine months ended September 30, 2019 and 2018, as well as the Company’s income before income taxes for such periods:



	Three Months Ended September 30,						Nine Months Ended September 30,
(In thousands)	2019			2018			2019			2018
Revenue:
Northern homebuilding	$	270,063		$	236,803		$	723,295		$	622,325
Southern homebuilding	369,828			318,846			995,305			902,377
Financial services ^(a)	13,454			12,193			39,540			39,095
Total revenue	$	653,345		$	567,842		$	1,758,140		$	1,563,797

Operating income:
Northern homebuilding^(b)	$	29,587		$	24,179		$	70,559		$	55,377
Southern homebuilding	32,500			27,133			76,308			69,051
Financial services^(a)	6,609			5,681			19,943			21,159
Less: Corporate selling, general and administrative expense	(14,047		)	(13,131		)	(35,556		)	(32,079		)
Total operating income^(b)	$	54,649		$	43,862		$	131,254		$	113,508

Interest expense:
Northern homebuilding	$	1,505		$	1,297		$	5,360		$	5,175
Southern homebuilding	2,146			2,294			8,602			7,718
Financial services ^(a)	986			835			2,664			2,299
Total interest expense	$	4,637		$	4,426		$	16,626		$	15,192

Equity in income from joint venture arrangements	(52		)	(44		)	(118		)	(268		)
Acquisition and integration costs^(c)	—			—			—			1,700

Income before income taxes	$	50,064		$	39,480		$	114,746		$	96,884


(a)	Our financial services operational results should be viewed in connection with our homebuilding business as its operations originate loans and provide title services primarily for our homebuying customers, with the exception of an immaterial amount of mortgage refinancing.


(b)	Includes $0.1 million and $0.7 million of acquisition-related charges taken during the three months ended September 30, 2019 and 2018, respectively, and $0.6 million and $4.5 million of acquisition-related charges taken during the nine months ended September 30, 2019 and 2018, respectively, as a result of our acquisition of Pinnacle Homes in Detroit, Michigan on March 1, 2018.


(c)	Represents costs which include, but are not limited to, legal fees and expenses, travel and communication expenses, cost of appraisals, accounting fees and expenses, and miscellaneous expenses related to our acquisition of Pinnacle Homes. As these costs are not eligible for capitalization as initial direct costs, such amounts are expensed as incurred.

The following tables show total assets by segment at September 30, 2019 and December 31, 2018:



	September 30, 2019
(In thousands)	Northern		Southern			Corporate, Financial Services and Unallocated			Total
Deposits on real estate under option or contract	$	3,688	$	24,703		$	—		$	28,391
Inventory ^(a)	784,533		1,014,144			—			1,798,677
Investments in joint venture arrangements	2,768		44,789			—			47,557
Other assets^(d)	32,296		58,377		^(b)	216,305		^(c)	306,978
Total assets	$	823,285	$	1,142,013		$	216,305		$	2,181,603



	December 31, 2018
(In thousands)	Northern		Southern			Corporate, Financial Services and Unallocated			Total
Deposits on real estate under option or contract	$	5,725	$	27,937		$	—		$	33,662
Inventory ^(a)	696,057		944,741			—			1,640,798
Investments in joint venture arrangements	1,562		34,308			—			35,870
Other assets	19,524		43,086		^(b)	248,641		^(c)	311,251
Total assets	$	722,868	$	1,050,072		$	248,641		$	2,021,581


(a)	Inventory includes single-family lots, land and land development costs; land held for sale; homes under construction; model homes and furnishings; community development district infrastructure; and consolidated inventory not owned.


(b)	Includes development reimbursements from local municipalities.


(c)	Includes asset held for sale for $5.6 million.

(d)

Includes $19.1 million of operating lease right-of-use assets recorded as a result of the adoption of ASU 2016-02 on January 1, 2019. See Note 1 and Note 15 for further information.