The accounting policies of the reporting segments are described throughout Note A included in the Company’s annual report on Form 10-K for the fiscal year ended September 30, 2017. Financial information relating to the Company’s reporting segments is as follows:



	December 31, 2017
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Other Adjustments (3)			Consolidated
	(In millions)
Assets
Cash and cash equivalents	$	558.0	$	321.8	$	24.5	$	16.0	$	—		$	920.3
Restricted cash	8.3		40.0		5.4		—		—			53.7
Inventories:
Construction in progress and finished homes	4,907.8		—		—		—		—			4,907.8
Residential land and lots — developed and under development	4,649.2		131.8		—		—		46.7			4,827.7
Land held for development	100.5		—		—		—		—			100.5
Land held for sale	18.2		183.2		—		—		2.8			204.2
	9,675.7		315.0		—		—		49.5			10,040.2
Investment in unconsolidated entities	—		65.1		—		—		21.0			86.1
Mortgage loans held for sale	—		—		538.2		—		—			538.2
Deferred income taxes	236.3		2.5		—		—		0.3			239.1
Property and equipment, net	204.3		2.0		3.1		148.3		—			357.7
Other assets	545.3		18.4		34.1		3.8		20.4			622.0
Goodwill	80.0		—		—		—		20.0			100.0
	$	11,307.9	$	764.8	$	605.3	$	168.1	$	111.2		$	12,957.3
Liabilities
Accounts payable	$	567.0	$	2.4	$	1.6	$	4.7	$	—		$	575.7
Accrued expenses and other liabilities	997.2		45.5		30.9		18.3		(23.8		)	1,068.1
Notes payable	2,749.6		108.4		387.5		—		12.6			3,258.1
	$	4,313.8	$	156.3	$	420.0	$	23.0	$	(11.2	)	$	4,901.9

______________


(1)	Results are presented on Forestar’s historical cost basis, consistent with the manner in which management evaluates segment performance. All purchase accounting adjustments are included in the Other Adjustments column.


(2)	Amounts represent the aggregate balances of certain subsidiaries that are immaterial for separate reporting.


(3)	Amounts represent purchase accounting adjustments related to the Forestar acquisition and the reclassification of $2.1 million of interest expense to inventory.



	September 30, 2017
	Homebuilding		Financial Services		Other (1)		Consolidated
	(In millions)
Assets
Cash and cash equivalents	$	973.0	$	24.1	$	10.7	$	1,007.8
Restricted cash	9.3		7.2		—		16.5
Inventories:
Construction in progress and finished homes	4,606.0		—		—		4,606.0
Residential land and lots — developed and under development	4,519.7		—		—		4,519.7
Land held for development	101.0		—		—		101.0
Land held for sale	10.4		—		—		10.4
	9,237.1		—		—		9,237.1
Mortgage loans held for sale	—		587.3		—		587.3
Deferred income taxes	365.0		—		—		365.0
Property and equipment, net	194.4		3.0		127.6		325.0
Other assets	518.7		42.2		5.0		565.9
Goodwill	80.0		—		—		80.0
	$	11,377.5	$	663.8	$	143.3	$	12,184.6
Liabilities
Accounts payable	$	575.6	$	1.5	$	3.3	$	580.4
Accrued expenses and other liabilities	933.1		35.6		16.3		985.0
Notes payable	2,451.6		420.0		—		2,871.6
	$	3,960.3	$	457.1	$	19.6	$	4,437.0

______________


(1)	Amounts represent the aggregate balances of certain subsidiaries that are immaterial for separate reporting.



	Three Months Ended December 31, 2017
	Homebuilding			Forestar (1)			Financial Services			Other (2)			Other Adjustments (3)			Consolidated
	(In millions)
Revenues:
Home sales	$	3,184.5		$	—		$	—		$	—		$	—		$	3,184.5
Land/lot sales and other	36.4			30.8			—			—			—			67.2
Financial services	—			—			81.0			—			—			81.0
	3,220.9			30.8			81.0			—			—			3,332.7
Cost of sales:
Home sales	2,521.5			—			—			—			—			2,521.5
Land/lot sales and other	31.2			19.3			—			—			4.4			54.9
Inventory and land option charges	3.7			—			—			—			—			3.7
	2,556.4			19.3			—			—			4.4			2,580.1
Selling, general and administrative expense	304.8			13.6			61.7			4.0			0.1			384.2
Equity in earnings of unconsolidated entities	—			(7.6		)	—			—			5.3			(2.3		)
Interest expense	—			2.1			—			—			(2.1		)	—
Other (income) expense	(14.1		)	(0.6		)	(2.9		)	(2.9		)	—			(20.5		)
Income before income taxes	$	373.8		$	4.0		$	22.2		$	(1.1	)	$	(7.7	)	$	391.2
Summary Cash Flow Information:
Depreciation and amortization	$	13.1		$	1.2		$	0.4		$	1.4		$	0.1		$	16.2
Cash (used in) provided by operating activities	$	(101.6	)	$	(36.2	)	$	67.9		$	3.0		$	(8.1	)	$	(75.0	)

______________


(1)	Results are presented from the date of acquisition and on Forestar’s historical cost basis, consistent with the manner in which management evaluates segment performance. All purchase accounting adjustments are included in the Other Adjustments column.


(2)	Amounts represent the aggregate results of certain subsidiaries that are immaterial for separate reporting.


(3)	Amounts represent purchase accounting adjustments related to the Forestar acquisition and the reclassification of $2.1 million of interest expense to inventory.



	Three Months Ended December 31, 2016
	Homebuilding			Financial Services			Other (1)			Consolidated
	(In millions)
Revenues:
Home sales	$	2,797.7		$	—		$	—		$	2,797.7
Land/lot sales and other	28.4			—			—			28.4
Financial services	—			78.1			—			78.1
	2,826.1			78.1			—			2,904.2
Cost of sales:
Home sales	2,244.8			—			—			2,244.8
Land/lot sales and other	20.8			—			—			20.8
Inventory and land option charges	2.3			—			—			2.3
	2,267.9			—			—			2,267.9
Selling, general and administrative expense	268.4			54.8			2.7			325.9
Other (income) expense	(4.1		)	(3.2		)	(0.4		)	(7.7		)
Income before income taxes	$	293.9		$	26.5		$	(2.3	)	$	318.1
Summary Cash Flow Information:
Depreciation and amortization	$	13.3		$	0.3		$	0.8		$	14.4
Cash (used in) provided by operating activities	$	(98.3	)	$	59.9		$	10.2		$	(28.2	)

______________


(1)	Amounts represent the aggregate results of certain subsidiaries that are immaterial for separate reporting.



Homebuilding Inventories by Reporting Segment (1)	December 31, 2017		September 30, 2017
	(In millions)
East	$	1,155.6	$	1,068.9
Midwest	543.3		492.6
Southeast	2,470.2		2,392.3
South Central	2,281.9		2,199.4
Southwest	516.7		506.1
West	2,477.7		2,352.5
Corporate and unallocated (2)	230.3		225.3
	$	9,675.7	$	9,237.1

______________


(1)	Homebuilding inventories are the only assets included in the measure of homebuilding segment assets used by the Company’s chief operating decision makers.


(2)	Corporate and unallocated consists primarily of capitalized interest and property taxes.



Homebuilding Results by Reporting Segment	Three Months Ended December 31,
	2017		2016
	(In millions)
Revenues
East	$	393.0	$	305.9
Midwest	161.4		151.1
Southeast	988.7		883.4
South Central	808.8		756.9
Southwest	156.4		108.6
West	712.6		620.2
	$	3,220.9	$	2,826.1
Income before Income Taxes (1)
East	$	45.0	$	26.3
Midwest	13.3		10.2
Southeast	122.5		99.6
South Central	101.5		96.5
Southwest	14.7		4.0
West	76.8		57.3
	$	373.8	$	293.9

______________

(1)

Expenses maintained at the corporate level consist primarily of interest and property taxes, which are capitalized and amortized to cost of sales or expensed directly, and the expenses related to operating the Company’s corporate office. The amortization of capitalized interest and property taxes is allocated to each segment based on the segment’s cost of sales, while expenses associated with the corporate office are allocated to each segment based on the segment’s inventory balances.