EX-99.1 3 e16767ex99-1.txt PRESS RELEASE Exhibit 99.1 Standard Pacific Corp. Caps Record Year With Record Fourth Quarter Earnings of $2.33 Per Share, Up 47%, and Raises 2004 Guidance to $6.90 to $7.00 Per Share Financial and Operating Highlights - 2003 Fourth Quarter vs. 2002 Fourth Quarter - Earnings per share up 47% to a record $2.33 vs. $1.58 last year - Net income of $79.7 million, up 52% - Homebuilding revenues up 18% to a record $802 million - Record 2,677 new home deliveries, up 13% from last year - Homebuilding gross margin up 330 basis points to 22.8% - Record Adjusted Homebuilding EBITDA* of $164 million, an increase of 75% over 2002, and an EBITDA margin of 20.5% - LTM return on average equity of 22.6% - Record 2,163 new home orders, up 34% year-over-year - Record year-end backlog of 4,435 homes, valued at $1.6 billion, up 54% Financial and Operating Highlights - 2003 Fiscal Year vs. 2002 Fiscal Year - Earnings per share up 66% to a record $6.08 vs. $3.67 last year - Record net income of $204.4 million, up 72% year-over-year - Record revenues of $2.3 billion, up 25% over 2002 - Record deliveries of 8,213 new homes, up 31% year-over-year - Record Adjusted Homebuilding EBITDA* of $404 million, up 66%, and an EBITDA margin of 17.3% - Record 9,187 new home orders, up 35% over 2002 Guidance for 2004 raised to $6.90 - $7.00 per share * For a definition of Adjusted Homebuilding EBITDA and a reconciliation of net income to Adjusted Homebuilding EBITDA and cash flows from operating activities to Adjusted Homebuilding EBITDA, please see the Selected Financial Data included herewith. IRVINE, Calif., Feb. 2 /PRNewswire-FirstCall/ -- Standard Pacific Corp. (NYSE: SPF) today reported the Company's 2003 fourth quarter and fiscal year operating results. Net income for the fourth quarter ended December 31, 2003 increased 52% to $79.7 million, or $2.33 per diluted share, compared to $52.3 million, or $1.58 per diluted share, for the year earlier period. The Company's operating results for the 2003 fourth quarter and full year reflect an after-tax charge of $2.0 million, or $0.06 per share, resulting from the Company's early retirement of its 8 1/2% senior notes due 2007 and an after-tax charge of $534,000, or $0.02 per share, resulting from the Company's decision to begin to expense the cost of stock option grants on a prospective basis effective with options granted during fiscal year 2003. For the year ended December 31, 2003, net income increased 72% to $204.4 million, or $6.08 per diluted share, compared to $118.7 million, or $3.67 per diluted share, last year. Stephen J. Scarborough, Chairman and Chief Executive Officer, stated, "Our record operating results for the 2003 fourth quarter cap another tremendous year of top line and bottom line growth reflecting the continued strength of the homebuilding industry and Standard Pacific's growing position in some of the largest and most dynamic markets in the country. For the five-year period ended December 31, 2003, our homebuilding revenues and earnings per share have grown at compound annual rates of 25% and 31%, respectively." "The Company's record of revenue and earnings growth is the result of our balanced strategy of expanding in our existing markets as well as into new geographic markets with long-term growth potential. In our established California and Arizona markets we saw full year deliveries for 2003 increase 24% and 9%, respectively. And in our first full year in the Southeastern United States, we delivered over 2,700 new homes, representing over 33% of our companywide deliveries. Building on our success in 2003, we expect to see opportunities for continued growth this year with deliveries projected to increase in all three of our operating regions -- the West, Southwest and Southeast." "We are also pleased with the progress we have made with respect to improvements in our homebuilding gross margin percentage, which was up 330 bp's year-over-year to 22.8%, and in our return on average stockholders' equity, which was 22.6% for the year ended December 31, 2003. These positive results reflect a growing emphasis in our organization on achieving strong shareholder returns while continuing to conservatively manage our balance sheet." Mr. Scarborough continued, "During the fourth quarter we completed two important acquisitions, Coppenbarger Homes in Jacksonville, Florida and the Sacramento, California operations of Lucas and Mercier, both of which enhance our growing market positions in the nation's two largest housing markets. Coppenbarger Homes represents our fourth acquisition in Florida within the past 18 months and our eighth market in the state, while our acquisition in Sacramento compliments our growing presence in Northern California's largest housing market." "As a result of our strong finish in 2003, which generated record order levels and backlog, we are raising our 2004 earnings' guidance for the full year to between $6.90 and $7.00 per share, up from our previous guidance of $6.40 to $6.50 per share. This would represent up to a 15% increase over our full year 2003 per share earnings. The updated guidance for 2004 reflects the impact of the one million new shares of common stock issued in December of 2003 to fund our growth initiatives, and also reflects the impact of our decision to expense the cost of stock option grants which is projected to represent an after-tax expense of approximately $2.0 million, or $0.06 per share for the year. For 2004 we are targeting 9,300 deliveries, excluding 300 joint venture new homes, and homebuilding revenues of approximately $3.2 billion. To support our 17% increase in projected deliveries this year, we are planning to open between 100 and 110 new communities, up approximately 30% year-over-year. As a result of the seasonal nature of our business and the timing of new community openings, we expect that approximately 60% of our profits this year will be generated in the second half of the year." "We are also providing initial earnings' guidance for the first quarter of 2004 of $0.85 to $0.90 per share which would represent up to a 20% increase over the 2003 first quarter. We are targeting 1,550 deliveries, excluding 75 joint venture new homes, and homebuilding revenues of $475 million in the quarter." Mr. Scarborough added, "As we conclude yet another successful year we look ahead to a bright future for our Company. We are encouraged by the underlying dynamics in the industry including prospects for long-term household growth driven by immigrant inflows and an aging population. We believe that these positive demographic trends and the growing constraints on the supply of new housing, coupled with our balanced growth strategy and experienced management team, provide a solid foundation as we begin 2004 with the anticipation of another record year." Homebuilding Operations Homebuilding pretax income for the 2003 fourth quarter increased 56% to $128.2 million from $82.5 million in the year earlier period. The increase in pretax income was driven by an 18% increase in homebuilding revenues, a 330 basis point improvement in the Company's homebuilding gross margin percentage, a $6.6 million increase in joint venture income and a 50 basis point decrease in our SG&A rate. Homebuilding revenues for the 2003 fourth quarter increased 18% to $802.3 million from $677.9 million last year. The increase in revenues was attributable to a 12% increase in new home deliveries (exclusive of joint ventures) combined with a 5% increase in our consolidated average home price to $324,000. During the 2003 fourth quarter the Company delivered 899 new homes in California (exclusive of joint ventures), a 17% increase over the 2002 fourth quarter. Including joint ventures, California deliveries were up 17% to 1,111 homes, which reflects strong housing market conditions throughout Southern California and improving market conditions in Northern California. Deliveries were up 3% in Southern California to 765 new homes (including 141 joint venture deliveries) and up 65% in Northern California to 346 new homes (including 71 joint venture deliveries). In Florida, where housing market conditions remained solid throughout the year, the Company delivered 775 new homes in the fourth quarter, including 58 homes from our recently acquired operations in Jacksonville, representing a 15% year-over-year increase (an increase of 7% excluding the deliveries from Jacksonville). The Company delivered 460 homes during the fourth quarter in Phoenix, a 17% increase over the 2002 fourth quarter, reflective of strong housing demand in the nation's second largest metropolitan housing market. In the Carolinas, deliveries were up 11% to 158 new homes. New home deliveries were off 51% in Texas and up 47% in Colorado. Although volume was up in Colorado, we continue to experience relatively sluggish demand in our Texas and Colorado markets, which combined generated less than 10% of our unit volume in 2003. During the 2003 fourth quarter the Company's average home price was up 5% year-over-year to $324,000. The higher selling price was driven primarily by a 7% increase in the Company's average price in California to $552,000 (exclusive of joint ventures). The higher price in California represents the impact of general price increases in the state and a change in mix during the 2003 fourth quarter. Our average price in Florida was $191,000, which was essentially flat with the year earlier period. Our average price in Arizona was up 3% to $180,000 but down 6% in the Carolinas to $134,000. Both changes are a result of shifts in the product mix. Our average price in Texas was down 13% reflecting our increasing emphasis on more affordable homes while our average price in Colorado was up 11% as we continue to build out many of our higher priced homes in that market. For 2004, we expect that our average home price will increase modestly to approximately $335,000 as a result of higher average prices in California and Florida, partially offset by lower average prices in Texas and Colorado due to a shift to more affordable homes. The Company's homebuilding gross margin was up 330 basis points year-over-year and up 110 basis points from the prior quarter to 22.8%. The increase in the year-over-year gross margin percentage was driven by higher margins in California, Florida and Arizona. Margins in Texas and Colorado are still well below our companywide average and generally reflect the impact of slower economic conditions in those regions. The higher overall gross margin percentage reflects our ability to raise home prices in most of our California and Florida markets during 2003 as a result of strong housing demand and improving margins in Arizona due to healthy demand for new homes combined with volume and cost efficiencies. The gross margins in our backlog are comparable to those generated in the fourth quarter of 2003. Selling, general and administrative expenses (including corporate G&A) for the 2003 fourth quarter improved 50 basis points to 8.9% of homebuilding revenues compared to 9.4% last year. The decrease in SG&A expenses as a percentage of homebuilding revenues was due primarily to the efficiencies realized in our overhead structure from the significant increase in revenues. For the full year, the Company's SG&A rate increased 30 basis points reflecting the impact of our expansion into the Southeastern United States where we generally incur higher levels of sales and marketing costs and G&A expenses as a percentage of revenue. We expect that our full-year SG&A rate for 2004 will be in the 10% range. The slightly higher SG&A rate compared to 2003 reflects the reclassification of certain expenses from cost of sales to SG&A to be consistent with industry practices. Income from unconsolidated joint ventures was up $6.6 million for the 2003 fourth quarter to $20.8 million and was driven by a 15% increase in joint venture deliveries to 212 new homes versus 184 last year, and an increase in joint venture income from land sales to other builders. For 2004, we expect to generate approximately $40 to $45 million in joint venture income from 300 new home deliveries as well as land sales to other builders. This compares to $60.7 million in 2003 from 620 venture deliveries and builder land sales. Demand remains strong in most of our key markets, as evidenced by new orders for the quarter rising 34% to a record 2,163 new homes (including joint ventures) on an 8% increase in average community count. The Company's cancellation rate for the quarter declined to 19% versus 22% last year. Orders were up 4% year-over-year in Southern California despite a 23% decline in the average number of active selling communities, up 244% in Northern California on a 60% higher community count, up 83% in Florida on a 75% higher community count and off 7% in Arizona on a 20% lower community count. Orders were down 12% in the Carolinas on an 11% higher community count, up 48% in Colorado on an 8% higher community count and down 19% in Texas on a 28% lower community count. The order levels in the Company's three largest markets, California, Florida and Arizona, generally reflect healthy housing market conditions in those regions while the order levels in Texas and Colorado still reflect the impact of generally weak economic conditions impacting the demand for new housing. The record level of new home orders for the 2003 fourth quarter resulted in a record fourth quarter backlog of 4,435 presold homes (including 166 joint venture homes) valued at an estimated $1.6 billion (including $104 million of joint venture backlog), an increase of 54% from the December 31, 2002 backlog value. The Company ended the year with 151 active selling communities, an 11% increase over the year earlier period. The higher community count resulted from the opening of 81 new communities in 2003 compared to 61 in 2002. The Company is planning to open 100 to 110 new communities during 2004 and is targeting a year-end community count of approximately 200 active subdivisions, 32% higher than the year earlier period. We expect to open nearly 60% of our new communities in the first half of the year, which is traditionally our strong selling season. Financial Services Fourth quarter profits for the Company's financial services subsidiary, which currently represents our mortgage banking operations throughout California and in South Florida, were off 33% to $1.4 million compared to $2.1 million last year. The decline in profit was driven by a 5% decrease in revenues combined with a 13% increase in expenses. The lower level of revenues was due to a decrease in the margins generated on loans sold, which was partially offset by a 14% increase in the volume of mortgage loans sold. The higher level of loan volume was driven by an increase in our California new home deliveries and the commencement of loan originations in South Florida at the end of 2002. The impact of the higher delivery levels was partially offset by a decrease in our California capture rate. The lower margins on loans sold resulted from the exceptionally high margins experienced during the 2002 fourth quarter resulting from a falling interest rate environment during that period. The increase in expenses for the financial services segment for the 2003 fourth quarter was primarily the result of start-up expenses incurred in connection with our current expansion into the Arizona and Texas markets. Financial services joint venture income, which is derived from mortgage banking joint ventures with third party financial institutions, which operate in conjunction with our homebuilding divisions in Arizona, Texas, Colorado, the Carolinas, and Tampa and Southwestern Florida, was up 9% to $916,000. The higher level of income was primarily due to increased deliveries in Florida and Arizona. Earnings Conference Call A conference call to discuss the Company's 2003 fourth quarter and fiscal year earnings will be held at 11:00 a.m. Eastern time today. The call will be broadcast live over the Internet and can be accessed through the Company's website at www.standardpacifichomes.com/investor/investors.asp. The call will also be accessible via telephone by dialing (800) 915-4836. The entire audio transmission with the synchronized slide presentation will also be available on our website for replay within 2 to 3 hours following the live broadcast. A replay of the conference call will also be available by dialing (800) 428-6051 (Code 329472). Standard Pacific, one of the nation's largest homebuilders, has built homes for more than 62,000 families during its 38-year history. The Company constructs homes within a wide range of price and size targeting a broad range of homebuyers. Standard Pacific operates in some of the strongest housing markets in the country with operations in major metropolitan areas in California, Texas, Arizona, Colorado, Florida and the Carolinas. The Company provides mortgage financing and title services to its homebuyers through its subsidiaries and joint ventures, Family Lending Services, SPH Mortgage, WRT Financial, Westfield Home Mortgage, Universal Land Title of South Florida and SPH Title. For more information about the Company and its new home developments please visit our website at: www.standardpacifichomes.com. This news release contains forward-looking statements. These statements include but are not limited to statements regarding: the Company's growing market position; improving operating performance, including expected returns on shareholders' equity; the outlook for 2004; that 60% of 2004 profits are expected to be generated in the second half of the year; orders and backlog; the Company's three to four year lot supply; expected new community openings and active sub-divisions; the Company's expected earnings, deliveries and revenues; the Company's expected SG&A rate; expected average home prices; the Company's expected homebuilding gross margin percentage and cost of stock option grants; and expected joint venture income and deliveries. Forward- looking statements are based on current expectations or beliefs regarding future events or circumstances, and you should not place undue reliance on these statements. Such statements involve known and unknown risks, uncertainties, assumptions and other factors -- many of which are out of our control and difficult to forecast -- that may cause actual results to differ materially from those that may be described or implied. Such factors include but are not limited to: local and general economic and market conditions, including consumer confidence, employment rates, interest rates, the cost and availability of mortgage financing, and stock market, home and land valuations; the impact on economic conditions of terrorist attacks or the outbreak or escalation of armed conflict involving the United States; the cost and availability of suitable undeveloped land, building materials and labor; the cost and availability of construction financing and corporate debt and equity capital; the demand for single-family homes; cancellations of purchase contracts by homebuyers; the cyclical and competitive nature of our business; governmental regulation, including the impact of "slow growth" or similar initiatives; delays in the land entitlement process, development, construction, or the opening of new home communities; adverse weather conditions and natural disasters; environmental matters; risks relating to our mortgage banking operations, including hedging activities; future business decisions and our ability to successfully implement our operational, growth and other strategies; litigation and warranty claims; and other risks discussed in our filings with the Securities and Exchange Commission, including in our Annual Report on Form 10-K for the year ended December 31, 2003. We assume no, and hereby disclaim any, obligation to update any of the foregoing or any other forward-looking statements. We nonetheless reserve the right to make such updates from time to time by press release, periodic report or other method of public disclosure without the need for specific reference to this press release. No such update shall be deemed to indicate that other statements not addressed by such update remain correct or create an obligation to provide any other updates. STANDARD PACIFIC CORP. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Dollars in thousands, except per share amounts) (Unaudited) Three Months Ended Year Ended December 31, December 31, 2003 2002 2003 2002 Homebuilding: Revenues $802,314 $677,859 $2,341,180 $1,870,757 Cost of sales (619,706) (545,681) (1,839,066) (1,531,879) Gross margin 182,608 132,178 502,114 338,878 Selling, general and administrative expenses (71,063) (63,948) (227,831) (175,218) Income from unconsolidated joint ventures 20,841 14,274 60,747 27,616 Interest expense (1,698) (1,444) (6,847) (5,489) Other income (expense) (2,467) 1,390 (1,433) 1,746 Homebuilding pretax income 128,221 82,450 326,750 187,533 Financial Services: Revenues 4,988 5,275 18,870 13,856 Expenses (3,594) (3,193) (14,072) (9,380) Income from unconsolidated joint ventures 916 842 3,169 2,323 Other income 171 160 381 349 Financial services pretax income 2,481 3,084 8,348 7,148 Income before taxes 130,702 85,534 335,098 194,681 Provision for income taxes (50,972) (33,239) (130,719) (75,992) Net Income $79,730 $52,295 $204,379 $118,689 Earnings Per Share: Basic $2.41 $1.61 $6.28 $3.78 Diluted $2.33 $1.58 $6.08 $3.67 Weighted Average Common Shares Outstanding: Basic 33,130,431 32,473,007 32,555,189 31,399,120 Diluted 34,262,795 33,198,731 33,610,735 32,321,260 Cash Dividends Per Share $0.08 $0.08 $0.32 $0.32 Selected Operating Data Three Months Ended Year Ended December 31, December 31, 2003 2002 2003 2002 New homes delivered: Southern California 624 612 1,980 1,727 Northern California 275 154 627 557 Total California 899 766 2,607 2,284 Florida 775 671 2,205 1,188 Arizona 460 394 1,555 1,432 Carolinas 158 142 538 241 Texas 76 155 421 520 Colorado 97 66 267 277 Consolidated total 2,465 2,194 7,593 5,942 Unconsolidated joint ventures: Southern California 141 128 442 242 Northern California 71 56 178 81 Total unconsolidated joint ventures 212 184 620 323 Total 2,677 2,378 8,213 6,265 Average selling price of homes delivered: California (excluding joint ventures) $552,000 $515,000 $521,000 $488,000 Florida $191,000 $191,000 $185,000 $197,000 Arizona $180,000 $174,000 $179,000 $173,000 Carolinas $134,000 $143,000 $135,000 $142,000 Texas $258,000 $295,000 $268,000 $287,000 Colorado $324,000 $293,000 $314,000 $318,000 Consolidated (excluding joint ventures) $324,000 $309,000 $305,000 $314,000 Unconsolidated joint ventures (California) $532,000 $547,000 $540,000 $532,000 Total (including joint ventures) $341,000 $327,000 $323,000 $326,000 Net new orders: Southern California 542 420 2,008 2,019 Northern California 231 81 857 639 Total California 773 501 2,865 2,658 Florida 738 404 2,675 1,115 Arizona 266 286 1,740 1,473 Carolinas 93 106 522 177 Texas 93 115 459 519 Colorado 92 62 350 287 Consolidated total 2,055 1,474 8,611 6,229 Unconsolidated joint ventures: Southern California 26 126 301 459 Northern California 82 10 275 124 Total unconsolidated joint ventures 108 136 576 583 Total 2,163 1,610 9,187 6,812 Average number of selling communities during the period: Southern California 22 24 21 23 Northern California 19 12 15 13 Florida 42 24 34 13 Arizona 16 20 20 20 Carolinas 10 9 9 4 Texas 18 25 19 25 Colorado 13 12 12 11 Consolidated total 140 126 130 109 Unconsolidated joint ventures: Southern California 2 7 4 7 Northern California 5 3 5 2 Total unconsolidated joint ventures 7 10 9 9 Total 147 136 139 118 Selected Operating Data (continued) At December 31, Backlog (in homes): 2003 2002 Southern California 884 856 Northern California 483 157 Total California 1,367 1,013 Florida 1,730 1,034 Arizona 752 567 Carolinas 65 81 Texas 184 146 Colorado 171 88 Consolidated total 4,269 2,929 Unconsolidated joint ventures: Southern California 83 224 Northern California 83 43 Total unconsolidated joint ventures 166 267 Total 4,435 3,196 Backlog (estimated dollar value in thousands): Consolidated total $1,460,058 $872,694 Unconsolidated joint ventures (California) 103,693 139,491 Total $1,563,751 $1,012,185 Building sites owned or controlled: Southern California 11,088 6,056 Northern California 5,022 3,791 Total California 16,110 9,847 Florida 12,458 8,007 Arizona 4,584 4,839 Carolinas 3,374 2,673 Texas 2,996 2,731 Colorado 1,647 1,792 Total 41,169 29,889 Total building sites owned 21,782 16,123 Total building sites optioned 13,702 10,200 Total joint venture lots 5,685 3,566 Total 41,169 29,889 Completed and unsold homes 159 280 Homes under construction 4,100 3,012 Selected Financial Data Three Months Ended December 31, 2003 2002 (Dollars in thousands) Net income(1) $79,730 $52,295 Net cash provided by (used in) operating activities(1) $94,150 $74,871 Net cash provided by (used in) investing activities(1) $(151,466) $(12,347) Net cash provided by (used in) financing activities(1) $(48,592) $(44,682) Adjusted Homebuilding EBITDA(2) $164,141 $93,572 Homebuilding SG&A as a percentage of homebuilding revenues 8.9% 9.4% Homebuilding interest incurred $21,130 $14,483 Homebuilding interest capitalized to inventories owned $19,432 $13,039 Ratio of LTM Adjusted Homebuilding EBITDA to homebuilding interest incurred 5.3x 4.3x (1) As determined in accordance with accounting principles generally accepted in the United States. (2) Adjusted Homebuilding EBITDA means net income (plus cash distributions of income from unconsolidated joint ventures) before (a) income taxes, (b) homebuilding interest expense, (c) expensing of previously capitalized interest included in cost of sales, (d) material noncash impairment charges, if any, (e) homebuilding depreciation and amortization, (f) amortization of stock-based compensation (g) income from unconsolidated joint ventures and (h) income from financial services subsidiary. Other companies may calculate Adjusted Homebuilding EBITDA (or similarly titled measures) differently. We believe Adjusted Homebuilding EBITDA information is useful to investors as a measure of our ability to service debt and obtain financing. However, it should be noted that Adjusted Homebuilding EBITDA is a non-GAAP financial measure. Due to the significance of the GAAP components excluded, Adjusted Homebuilding EBITDA should not be considered in isolation or as an alternative to net income, cash flow from operations or any other operating or liquidity performance measure prescribed by accounting principles generally accepted in the United States. The tables set forth below reconcile net cash provided by (used in) operating activities and net income, calculated and presented in accordance with accounting principles generally accepted in the United States, to Adjusted Homebuilding EBITDA: Three Months Ended Year Ended December 31, December 31, 2003 2002 2003 2002 (Dollars in thousands) Net cash provided by (used in) operating activities $94,150 $74,871 $10,687 $76,064 Add: Income taxes 50,972 33,239 130,719 75,992 Homebuilding interest expense 1,698 1,444 6,847 5,489 Expensing of previously capitalized interest included in cost of sales 19,812 16,588 62,607 48,208 Material noncash impairment charges -- -- -- 8,952 Less: Income from financial services subsidiary 1,394 2,082 4,798 4,476 Depreciation and amortization from financial services subsidiary 87 64 326 199 Net changes in operating assets and liabilities: Mortgages, other notes and receivables 10,442 54,946 (38,236) 28,437 Inventories-owned 34,318 (154,179) 335,081 (42,472) Inventories-not owned (29,828) 64,533 (65,325) 50,270 Deferred income taxes 8,793 (1,332) 7,730 (4,417) Other assets (5,535) 11,876 (18,061) 17,691 Accounts payable (4,213) 3,389 (5,602) 3,000 Accrued liabilities (25,706) (9,657) (59,592) (19,111) Liabilities from inventories not owned 10,719 -- 42,197 -- Adjusted Homebuilding EBITDA $164,141 $93,572 $403,928 $243,428 Selected Financial Data (continued) Three Months Ended Year Ended December 31, December 31, 2003 2002 2003 2002 (Dollars in thousands) Net income $79,730 $52,295 $204,379 $118,689 Add: Cash distributions of income from unconsolidated joint ventures 33,241 6,398 63,905 18,034 Income taxes 50,972 33,239 130,719 75,992 Homebuilding interest expense 1,698 1,444 6,847 5,489 Expensing of previously capitalized interest included in cost of sales 19,812 16,588 62,607 48,208 Material noncash impairment charges -- -- -- 8,952 Homebuilding depreciation and amortization 964 806 3,310 2,479 Amortization of stock-based compensation 875 -- 875 -- Less: Income from unconsolidated joint ventures 21,757 15,116 63,916 29,939 Income from financial services subsidiary 1,394 2,082 4,798 4,476 Adjusted Homebuilding EBITDA $164,141 $93,572 $403,928 $243,428 Balance Sheet Data (Dollars in thousands, except per share amounts) At December 31, 2003 2002 Stockholders' equity per share $30.51 $24.04 Ratio of total debt to total book capitalization (1) 50.8% 49.3% Ratio of adjusted net homebuilding debt to total book capitalization (2) 44.7% 44.4% Ratio of total debt to LTM adjusted homebuilding EBITDA (1) 2.6x 3.1x Ratio of adjusted net homebuilding debt to LTM adjusted homebuilding EBITDA (2) 2.1x 2.5x Homebuilding interest capitalized in inventories owned $38,438 $31,860 Homebuilding interest capitalized as a percentage of inventories owned 2.2% 2.5% (1) Total debt at December 31, 2003 and 2002 includes $59.3 million and $112.0 million, respectively, of indebtedness of the Company's financial services subsidiary and $12.5 million and $0 million, respectively, of indebtedness included in liabilities from inventories not owned. (2) Net homebuilding debt reflects the offset of $159.7 million and $22.2 million in cash and equivalents at December 31, 2003 and 2002, respectively, against homebuilding debt of $996.2 million and $639.0 million, respectively. Adjusted net homebuilding debt at December 31, 2003 and 2002 is further adjusted to exclude $59.3 million and $112.0 million, respectively, of indebtedness of the Company's financial services subsidiary and $12.5 million and $0, respectively, of indebtedness included in liabilities from inventories not owned. We believe that the adjusted net homebuilding debt to total book capitalization and net adjusted homebuilding debt to LTM adjusted homebuilding EBITDA ratios are useful to investors as a measure of our ability to obtain financing. These are non-GAAP ratios and other companies may calculate these ratios differently. STANDARD PACIFIC CORP. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands) December 31, December 31, 2003 2002 (Unaudited) ASSETS Homebuilding: Cash and equivalents $159,654 $22,245 Mortgage notes receivable and accrued interest 7,171 3,682 Other notes and receivables 37,721 34,451 Inventories: Owned 1,760,567 1,267,374 Not owned 128,453 108,389 Investments in and advances to unconsolidated joint ventures 164,649 122,460 Property and equipment, net 7,343 7,524 Deferred income taxes 26,361 18,611 Other assets 17,291 19,097 Goodwill 73,558 58,062 2,382,768 1,661,895 Financial Services: Cash and equivalents 10,829 5,406 Mortgage loans held for sale 64,043 109,861 Other assets 3,063 14,964 77,935 130,231 Total Assets $ 2,460,703 $1,792,126 LIABILITIES AND STOCKHOLDERS' EQUITY Homebuilding: Accounts payable $77,837 $71,439 Accrued liabilities 203,138 147,677 Liabilities from inventories not owned 19,615 46,155 Trust deed and other notes payable 24,232 16,670 Senior notes payable 823,001 473,469 Senior subordinated notes payable 148,936 148,854 1,296,759 904,264 Financial Services: Accounts payable and other liabilities 1,694 2,116 Mortgage credit facilities 59,317 111,988 61,011 114,104 Total Liabilities 1,357,770 1,018,368 Minority Interests 69,732 -- Stockholders' Equity: Preferred stock, $0.01 par value; 10,000,000 shares authorized; none issued -- -- Common stock, $0.01 par value; 100,000,000 shares authorized; 33,862,218 and 32,183,630 shares outstanding, respectively 339 322 Additional paid-in capital 435,164 369,723 Retained earnings 597,698 403,713 Total Stockholders' Equity 1,033,201 773,758 Total Liabilities and Stockholders' Equity $2,460,703 $1,792,126 SOURCE Standard Pacific Corp. -0- 02/02/2004 /CONTACT: Andrew H. Parnes, Senior Vice President of Standard Pacific Corp., +1-949-789-1616/ /Web site: http://www.standardpacifichomes.com / /Audio: http://www.standardpacifichomes.com/investor/investors.asp / (SPF) CO: Standard Pacific Corp. ST: California IN: CST RLT SU: ERN ERP CCA MAV