SUPPLEMENTAL GUARANTOR INFORMATION

All of the Company’s homebuilding senior notes and the homebuilding revolving credit facility are fully and unconditionally guaranteed, on a joint and several basis, by D.R. Horton, Inc. and other subsidiaries (Guarantor Subsidiaries). Each of the Guarantor Subsidiaries is 100% owned, directly or indirectly, by the Company. The Company’s subsidiaries associated with the Forestar land development operation, the financial services operations and certain other subsidiaries do not guarantee the Company’s senior notes or the revolving credit facility (collectively, Non-Guarantor Subsidiaries). In lieu of providing separate financial statements for the Guarantor Subsidiaries, consolidating condensed financial statements are presented below. Separate financial statements and other disclosures concerning the Guarantor Subsidiaries are not presented because management has determined that they are not material to investors.

The guarantees by a Guarantor Subsidiary will be automatically and unconditionally released and discharged upon: (1) the sale or other disposition of its common stock whereby it is no longer a subsidiary of the Company; (2) the sale or other disposition of all or substantially all of its assets (other than to the Company or another Guarantor); (3) its merger or consolidation with an entity other than the Company or another Guarantor; or (4) depending on the provisions of the applicable indenture, either its (a) proper designation as an unrestricted subsidiary, (b) ceasing to guarantee any of the Company’s publicly traded debt securities, or (c) ceasing to guarantee any of the Company’s obligations under the revolving credit facility.

To conform to the current year presentation, the Company’s equity in income of subsidiaries in its condensed consolidating statements of operations for the fiscal 2017 periods is presented after income tax expense. As a result, the amounts of equity in income of subsidiaries and income tax expense were each reduced by $111.1 million and $299.2 million in the three and nine months ended June 30, 2017, respectively, in both the D.R. Horton, Inc. and Eliminations columns. This reclassification, which the Company determined was not material, had no impact on any financial statements or notes, except for the D.R. Horton, Inc. and Eliminations columns of the condensed consolidating statements of operations in this Supplemental Guarantor Information note. Prior period financial information will be presented similarly in the condensed consolidating statement of operations of future filings.

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Balance Sheet

June 30, 2018



	D.R. Horton, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total
	(In millions)
ASSETS
Cash and cash equivalents	$	596.1	$	107.3	$	474.8	$	—		$	1,178.2
Restricted cash	7.9		3.3		47.5		—			58.7
Investments in subsidiaries	6,064.2		—		—		(6,064.2		)	—
Inventories	4,089.8		5,806.0		412.9		(5.4		)	10,303.3
Investment in unconsolidated entities	—		—		32.2		—			32.2
Mortgage loans held for sale	—		—		679.9		—			679.9
Deferred income taxes, net	79.0		121.9		3.7		—			204.6
Property and equipment, net	111.7		63.5		216.6		(6.6		)	385.2
Other assets	269.7		320.8		87.8		(36.2		)	642.1
Goodwill	—		80.0		29.2		—			109.2
Intercompany receivables	425.9		—		—		(425.9		)	—
Total Assets	$	11,644.3	$	6,502.8	$	1,984.6	$	(6,538.3	)	$	13,593.4
LIABILITIES & EQUITY
Accounts payable and other liabilities	$	593.2	$	980.3	$	197.2	$	(40.8	)	$	1,729.9
Intercompany payables	—		175.6		250.3		(425.9		)	—
Notes payable	2,443.0		4.1		646.5		—			3,093.6
Total Liabilities	3,036.2		1,160.0		1,094.0		(466.7		)	4,823.5
Stockholders’ equity	8,608.1		5,342.8		721.4		(6,075.0		)	8,597.3
Noncontrolling interests	—		—		169.2		3.4			172.6
Total Equity	8,608.1		5,342.8		890.6		(6,071.6		)	8,769.9
Total Liabilities & Equity	$	11,644.3	$	6,502.8	$	1,984.6	$	(6,538.3	)	$	13,593.4

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Balance Sheet

September 30, 2017



	D.R. Horton, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total
	(In millions)
ASSETS
Cash and cash equivalents	$	780.9	$	154.5	$	72.4	$	—		$	1,007.8
Restricted cash	7.8		1.5		7.2		—			16.5
Investments in subsidiaries	4,812.6		—		—		(4,812.6		)	—
Inventories	3,540.4		5,579.9		116.8		—			9,237.1
Mortgage loans held for sale	—		—		587.3		—			587.3
Deferred income taxes, net	138.5		223.6		2.9		—			365.0
Property and equipment, net	104.8		59.7		166.3		(5.8		)	325.0
Other assets	245.5		259.7		60.7		—			565.9
Goodwill	—		80.0		—		—			80.0
Intercompany receivables	1,047.7		—		—		(1,047.7		)	—
Total Assets	$	10,678.2	$	6,358.9	$	1,013.6	$	(5,866.1	)	$	12,184.6
LIABILITIES & EQUITY
Accounts payable and other liabilities	$	483.9	$	956.9	$	126.6	$	(2.0	)	$	1,565.4
Intercompany payables	—		732.2		315.5		(1,047.7		)	—
Notes payable	2,443.4		8.2		420.0		—			2,871.6
Total Liabilities	2,927.3		1,697.3		862.1		(1,049.7		)	4,437.0
Stockholders’ equity	7,750.9		4,661.6		151.0		(4,816.4		)	7,747.1
Noncontrolling interests	—		—		0.5		—			0.5
Total Equity	7,750.9		4,661.6		151.5		(4,816.4		)	7,747.6
Total Liabilities & Equity	$	10,678.2	$	6,358.9	$	1,013.6	$	(5,866.1	)	$	12,184.6

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Operations

Three Months Ended June 30, 2018



	D.R. Horton, Inc.			Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
Revenues	$	1,630.8		$	2,693.9	$	119.5		$	(8.9	)	$	4,435.3
Cost of sales	1,293.3			2,092.5		17.0			(5.6		)	3,397.2
Selling, general and administrative expense	174.4			174.1		86.4			—			434.9
Equity in earnings of unconsolidated entities	—			—		(0.4		)	—			(0.4		)
Other (income) expense	(1.5		)	0.5		(11.6		)	—			(12.6		)
Income before income taxes	164.6			426.8		28.1			(3.3		)	616.2
Income tax expense	43.8			113.6		5.1			—			162.5
Equity in net income of subsidiaries, net of tax	336.2			—		—			(336.2		)	—
Net income	457.0			313.2		23.0			(339.5		)	453.7
Net loss attributable to noncontrolling interests	—			—		(3.5		)	3.4			(0.1		)
Net income attributable to D.R. Horton, Inc.	$	457.0		$	313.2	$	26.5		$	(342.9	)	$	453.8

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Operations

Nine Months Ended June 30, 2018



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
Revenues	$	4,082.7		$	7,149.0		$	353.6		$	(22.4	)	$	11,562.9
Cost of sales	3,235.0			5,659.4			61.1			(16.5		)	8,939.0
Selling, general and administrative expense	483.4			490.6			245.9			—			1,219.9
Equity in earnings of unconsolidated entities	—			—			(3.1		)	—			(3.1		)
Gain on sale of assets	—			—			(14.5		)	—			(14.5		)
Other (income) expense	(3.5		)	(0.2		)	(27.0		)	—			(30.7		)
Income before income taxes	367.8			999.2			91.2			(5.9		)	1,452.3
Income tax expense	117.0			318.7			24.2			(1.0		)	458.9
Equity in net income of subsidiaries, net of tax	747.5			—			—			(747.5		)	—
Net income	998.3			680.5			67.0			(752.4		)	993.4
Net loss attributable to noncontrolling interests	—			—			(4.1		)	3.4			(0.7		)
Net income attributable to D.R. Horton, Inc.	$	998.3		$	680.5		$	71.1		$	(755.8	)	$	994.1

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Operations

Three Months Ended June 30, 2017



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
Revenues	$	1,332.0		$	2,352.3		$	92.1		$	—		$	3,776.4
Cost of sales	1,056.7			1,900.9			3.5			—			2,961.1
Selling, general and administrative expense	148.5			159.9			66.1			—			374.5
Other (income) expense	(0.7		)	(0.2		)	(2.8		)	—			(3.7		)
Income before income taxes	127.5			291.7			25.3			—			444.5
Income tax expense	44.4			101.3			9.8			—			155.5
Equity in net income of subsidiaries, net of tax	205.9			—			—			(205.9		)	—
Net income	$	289.0		$	190.4		$	15.5		$	(205.9	)	$	289.0

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Operations

Nine Months Ended June 30, 2017



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
Revenues	$	3,344.5		$	6,293.0		$	294.4		$	—		$	9,931.9
Cost of sales	2,670.0			5,072.9			36.0			—			7,778.9
Selling, general and administrative expense	415.7			452.8			187.0			—			1,055.5
Other (income) expense	(5.9		)	(1.1		)	(12.0		)	—			(19.0		)
Income before income taxes	264.7			768.4			83.4			—			1,116.5
Income tax expense	92.2			267.7			31.5			—			391.4
Equity in net income of subsidiaries, net of tax	552.6			—			—			(552.6		)	—
Net income	$	725.1		$	500.7		$	51.9		$	(552.6	)	$	725.1

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Cash Flows

Nine Months Ended June 30, 2018



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
OPERATING ACTIVITIES
Net cash (used in) provided by operating activities	$	(17.9	)	$	640.4		$	(254.0	)	$	(62.0	)	$	306.5
INVESTING ACTIVITIES
Expenditures for property and equipment	(29.1		)	(21.5		)	(64.5		)	5.0			(110.1		)
Proceeds from sale of assets	—			—			261.1			—			261.1
Increase in restricted cash	(0.2		)	(1.8		)	(40.2		)	—			(42.2		)
Investment in unconsolidated entities	—			—			(0.1		)	—			(0.1		)
Return of investment in unconsolidated entities	—			—			15.5			—			15.5
Net principal increase of other mortgage loans and real estate owned	—			—			(0.8		)	—			(0.8		)
Intercompany advances	615.7			—			—			(615.7		)	—
Payments related to business acquisitions, net of cash acquired	(560.0		)	—			401.9			—			(158.1		)
Net cash provided by (used in) investing activities	26.4			(23.3		)	572.9			(610.7		)	(34.7		)
FINANCING ACTIVITIES
Proceeds from notes payable	2,162.2			—			2.1			—			2,164.3
Repayment of notes payable	(2,165.2		)	(3.7		)	(10.6		)	—			(2,179.5		)
Advances on mortgage repurchase facility, net	—			—			106.3			—			106.3
Intercompany advances	—			(660.6		)	44.9			615.7			—
Proceeds from stock associated with certain employee benefit plans	36.2			—			—			—			36.2
Cash paid for shares withheld for taxes	(10.3		)	—			—			—			(10.3		)
Cash dividends paid	(141.3		)	—			(57.0		)	57.0			(141.3		)
Repurchases of common stock	(74.9		)	—			—			—			(74.9		)
Distributions to noncontrolling interests, net	—			—			(2.2		)	—			(2.2		)
Net cash (used in) provided by financing activities	(193.3		)	(664.3		)	83.5			672.7			(101.4		)
(Decrease) increase in cash and cash equivalents	(184.8		)	(47.2		)	402.4			—			170.4
Cash and cash equivalents at beginning of period	780.9			154.5			72.4			—			1,007.8
Cash and cash equivalents at end of period	$	596.1		$	107.3		$	474.8		$	—		$	1,178.2

NOTE O – SUPPLEMENTAL GUARANTOR INFORMATION - (Continued)

Consolidating Statement of Cash Flows

Nine Months Ended June 30, 2017



	D.R. Horton, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total
	(In millions)
OPERATING ACTIVITIES
Net cash (used in) provided by operating activities	$	(392.7	)	$	239.1		$	42.9		$	(75.0	)	$	(185.7	)
INVESTING ACTIVITIES
Expenditures for property and equipment	(44.6		)	(18.8		)	(40.1		)	—			(103.5		)
Increase in restricted cash	(1.1		)	(0.3		)	(8.5		)	—			(9.9		)
Net principal decrease of other mortgage loans and real estate owned	—			—			5.3			—			5.3
Purchases of debt securities collateralized by residential real estate	(8.8		)	—			—			—			(8.8		)
Intercompany advances	187.3			—			—			(187.3		)	—
Payments related to business acquisitions	(4.1		)	—			—			—			(4.1		)
Net cash provided by (used in) investing activities	128.7			(19.1		)	(43.3		)	(187.3		)	(121.0		)
FINANCING ACTIVITIES
Proceeds from notes payable	700.0			—			—			—			700.0
Repayment of notes payable	(1,050.0		)	(1.4		)	—			—			(1,051.4		)
Advances on mortgage repurchase facility, net	—			—			0.4			—			0.4
Intercompany advances	—			(282.8		)	95.5			187.3			—
Proceeds from stock associated with certain employee benefit plans	34.3			—			—			—			34.3
Excess income tax benefit from employee stock awards	10.5			—			—			—			10.5
Cash paid for shares withheld for taxes	(5.1		)	—			—			—			(5.1		)
Cash dividends paid	(112.2		)	—			(75.0		)	75.0			(112.2		)
Repurchases of common stock	(60.6		)	—			—			—			(60.6		)
Net cash (used in) provided by financing activities	(483.1		)	(284.2		)	20.9			262.3			(484.1		)
(Decrease) increase in cash and cash equivalents	(747.1		)	(64.2		)	20.5			—			(790.8		)
Cash and cash equivalents at beginning of period	1,076.4			154.0			72.8			—			1,303.2
Cash and cash equivalents at end of period	$	329.3		$	89.8		$	93.3		$	—		$	512.4