Segment Information (Tables)

6 Months Ended

Mar. 31, 2020

Segment Reporting [Abstract]

Schedule of segment reporting information, by segment

Financial information relating to the Company’s reporting segments is as follows:

	March 31, 2020
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Assets
Cash and cash equivalents	$	1,012.6	$	438.2	$	45.8	$	26.2	$	—	$	—	$	1,522.8
Restricted cash	7.8		—		6.6		0.1		—		—		14.5
Inventories:
Construction in progress and finished homes	6,003.8		—		—		—		(34.4)		—		5,969.4
Residential land and lots — developed and under development	5,009.6		1,171.0		—		—		(29.9)		1.2		6,151.9
Land held for development	48.9		28.2		—		—		—		—		77.1
Land held for sale	26.1		—		—		—		—		—		26.1
	11,088.4		1,199.2		—		—		(64.3)		1.2		12,224.5
Mortgage loans held for sale	—		—		1,379.4		—		—		—		1,379.4
Deferred income taxes, net	136.7		8.0		—		—		10.8		(6.0)		149.5
Property and equipment, net	327.2		1.0		3.3		259.2		(1.0)		—		589.7
Other assets	891.5		29.2		203.5		47.9		(97.6)		11.6		1,086.1
Goodwill	134.3		—		—		—		—		29.2		163.5
	$	13,598.5	$	1,675.6	$	1,638.6	$	333.4	$	(152.1)	$	36.0	$	17,130.0
Liabilities
Accounts payable	$	670.6	$	23.1	$	0.2	$	13.1	$	—	$	—	$	707.0
Accrued expenses and other liabilities	1,165.7		175.6		146.7		10.5		(105.1)		(11.8)		1,381.6
Notes payable	2,480.0		640.1		1,186.5		—		—		—		4,306.6
	$	4,316.3	$	838.8	$	1,333.4	$	23.6	$	(105.1)	$	(11.8)	$	6,395.2

______________

(1)Amounts 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 the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

	September 30, 2019
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Assets
Cash and cash equivalents	$	1,043.0	$	382.8	$	43.4	$	25.1	$	—	$	—	$	1,494.3
Restricted cash	8.0		—		11.6		0.1		—		—		19.7
Inventories:
Construction in progress and finished homes	5,249.0		—		—		—		(4.0)		—		5,245.0
Residential land and lots — developed and under development	4,956.1		1,011.8		—		—		(31.4)		2.9		5,939.4
Land held for development	60.7		17.1		—		—		—		—		77.8
Land held for sale	19.8		—		—		—		—		—		19.8
	10,285.6		1,028.9		—		—		(35.4)		2.9		11,282.0
Mortgage loans held for sale	—		—		1,072.0		—		—		—		1,072.0
Deferred income taxes, net	146.4		17.4		—		—		5.1		(5.8)		163.1
Property and equipment, net	272.4		2.4		3.2		221.2		—		—		499.2
Other assets	826.2		24.2		68.3		71.5		(88.5)		11.1		912.8
Goodwill	134.3		—		—		—		—		29.2		163.5
	$	12,715.9	$	1,455.7	$	1,198.5	$	317.9	$	(118.8)	$	37.4	$	15,606.6
Liabilities
Accounts payable	$	598.6	$	16.8	$	7.0	$	11.6	$	—	$	—	$	634.0
Accrued expenses and other liabilities	1,152.5		169.5		53.0		9.3		(93.6)		(12.6)		1,278.1
Notes payable	2,047.6		460.5		888.9		—		—		2.4		3,399.4
	$	3,798.7	$	646.8	$	948.9	$	20.9	$	(93.6)	$	(10.2)	$	5,311.5

______________

(1)Amounts 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 the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

	Three Months Ended March 31, 2020
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Revenues
Home sales	$	4,363.3	$	—	$	—	$	—	$	—	$	—	$	4,363.3
Land/lot sales and other	15.5		159.1		—		9.5		(151.9)		—		32.2
Financial services	—		—		104.5		—		—		—		104.5
	4,378.8		159.1		104.5		9.5		(151.9)		—		4,500.0
Cost of sales
Home sales (5)	3,435.5		—		—		—		(11.0)		—		3,424.5
Land/lot sales and other	11.3		136.5		—		—		(130.4)		—		17.4
Inventory and land option charges	8.8		0.1		—		—		—		—		8.9
	3,455.6		136.6		—		—		(141.4)		—		3,450.8
Selling, general and administrative expense	361.8		11.2		85.9		7.8		—		0.1		466.8
Gain on sale of assets	—		(0.3)		—		(28.2)		—		—		(28.5)
Other (income) expense	(4.1)		(2.1)		(6.1)		1.9		—		—		(10.4)
Income before income taxes	$	565.5	$	13.7	$	24.7	$	28.0	$	(10.5)	$	(0.1)	$	621.3

______________

(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 results of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

(5)Amount in the Eliminations column represents the profit on lots sold from Forestar to the homebuilding segment. Intercompany profit is eliminated in the consolidated financial statements when Forestar sells lots to the homebuilding segment and is recognized in the consolidated financial statements when the homebuilding segment closes homes on the lots to homebuyers.

	Six Months Ended March 31, 2020
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Revenues:
Home sales	$	8,226.6	$	—	$	—	$	—	$	—	$	—	$	8,226.6
Land/lot sales and other	35.2		406.4		—		18.3		(373.2)		—		86.7
Financial services	—		—		207.4		—		—		—		207.4
	8,261.8		406.4		207.4		18.3		(373.2)		—		8,520.7
Cost of sales:
Home sales (5)	6,487.0		—		—		—		(17.7)		—		6,469.3
Land/lot sales and other	24.7		352.8		—		—		(323.9)		(0.7)		52.9
Inventory and land option charges	12.4		0.4		—		—		—		—		12.8
	6,524.1		353.2		—		—		(341.6)		(0.7)		6,535.0
Selling, general and administrative expense	720.2		21.7		163.8		16.7		—		0.2		922.6
Gain on sale of assets	—		(0.1)		—		(59.4)		—		—		(59.5)
Other (income) expense	(9.6)		(4.2)		(11.6)		3.5		—		—		(21.9)
Income before income taxes	$	1,027.1	$	35.8	$	55.2	$	57.5	$	(31.6)	$	0.5	$	1,144.5
Summary Cash Flow Information:
Depreciation and amortization	$	33.7	$	0.1	$	0.8	$	3.9	$	—	$	0.3	$	38.8
Cash provided by (used in) operating activities	$	52.1	$	(123.8)	$	(312.1)	$	5.5	$	(16.8)	$	—	$	(395.1)

______________

(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 results of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

(5)Amount in the Eliminations column represents the profit on lots sold from Forestar to the homebuilding segment. Intercompany profit is eliminated in the consolidated financial statements when Forestar sells lots to the homebuilding segment and is recognized in the consolidated financial statements when the homebuilding segment closes homes on the lots to homebuyers.

	Three Months Ended March 31, 2019
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Revenues
Home sales	$	3,980.5	$	—	$	—	$	—	$	—	$	—	$	3,980.5
Land/lot sales and other	14.9		65.4		—		6.0		(39.7)		—		46.6
Financial services	—		—		101.6		—		—		—		101.6
	3,995.4		65.4		101.6		6.0		(39.7)		—		4,128.7
Cost of sales
Home sales (5)	3,214.2		—		—		—		(0.7)		—		3,213.5
Land/lot sales and other	9.3		43.7		—		—		(31.8)		8.2		29.4
Inventory and land option charges	13.8		—		—		—		—		—		13.8
	3,237.3		43.7		—		—		(32.5)		8.2		3,256.7
Selling, general and administrative expense	359.3		6.2		71.3		7.3		—		0.1		444.2
Gain on sale of assets	—		—		—		(29.3)		—		—		(29.3)
Other (income) expense	(1.6)		(0.9)		(3.7)		0.5		—		—		(5.7)
Income before income taxes	$	400.4	$	16.4	$	34.0	$	27.5	$	(7.2)	$	(8.3)	$	462.8

______________

(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 results of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

(5)Amount in the Eliminations column represents the profit on lots sold from Forestar to the homebuilding segment. Intercompany profit is eliminated in the consolidated financial statements when Forestar sells lots to the homebuilding segment and is recognized in the consolidated financial statements when the homebuilding segment closes homes on the lots to homebuyers.

	Six Months Ended March 31, 2019
	Homebuilding		Forestar (1)		Financial Services		Other (2)		Eliminations (3)		Other Adjustments (4)		Consolidated
	(In millions)
Revenues:
Home sales	$	7,391.2	$	—	$	—	$	—	$	—	$	—	$	7,391.2
Land/lot sales and other	21.7		103.8		—		12.8		(68.7)		—		69.6
Financial services	—		—		186.9		—		—		—		186.9
	7,412.9		103.8		186.9		12.8		(68.7)		—		7,647.7
Cost of sales:
Home sales (5)	5,943.4		—		—		—		(1.7)		—		5,941.7
Land/lot sales and other	14.5		74.3		—		—		(56.3)		11.8		44.3
Inventory and land option charges	21.8		—		—		—		—		—		21.8
	5,979.7		74.3		—		—		(58.0)		11.8		6,007.8
Selling, general and administrative expense	683.9		11.9		137.0		13.9		—		0.3		847.0
Gain on sale of assets	(2.0)		(0.9)		—		(29.3)		—		0.9		(31.3)
Other (income) expense	(3.5)		(2.8)		(7.7)		(0.3)		—		—		(14.3)
Income before income taxes	$	754.8	$	21.3	$	57.6	$	28.5	$	(10.7)	$	(13.0)	$	838.5
Summary Cash Flow Information:
Depreciation and amortization	$	30.1	$	0.1	$	0.7	$	2.9	$	—	$	0.3	$	34.1
Cash (used in) provided by operating activities	$	(215.9)	$	(283.4)	$	48.8	$	(4.1)	$	(2.7)	$	(4.4)	$	(461.7)

______________

(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 results of certain subsidiaries that are immaterial for separate reporting.

(3)Amounts represent the elimination of intercompany transactions.

(4)Amounts represent purchase accounting adjustments related to the Forestar acquisition.

(5)Amount in the Eliminations column represents the profit on lots sold from Forestar to the homebuilding segment. Intercompany profit is eliminated in the consolidated financial statements when Forestar sells lots to the homebuilding segment and is recognized in the consolidated financial statements when the homebuilding segment closes homes on the lots to homebuyers.

Homebuilding Inventories by Reporting Segment (1)	March 31, 2020		September 30, 2019
	(In millions)
East	$	1,329.8	$	1,288.8
Midwest	903.2		836.8
Southeast	2,968.1		2,768.0
South Central	2,845.4		2,533.2
Southwest	633.8		574.4
West	2,174.1		2,056.0
Corporate and unallocated (2)	234.0		228.4
	$	11,088.4	$	10,285.6

_________________

(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 March 31,				Six Months Ended March 31,
	2020		2019		2020		2019
	(In millions)
Revenues
East	$	579.7	$	518.2	$	1,100.2	$	965.7
Midwest	308.7		248.1		591.3		497.2
Southeast	1,316.7		1,205.3		2,467.3		2,219.2
South Central	1,066.4		990.2		2,025.1		1,862.7
Southwest	199.7		173.2		410.7		316.9
West	907.6		860.4		1,667.2		1,551.2
	$	4,378.8	$	3,995.4	$	8,261.8	$	7,412.9
Inventory and Land Option Charges
East	$	(0.5)	$	0.3	$	(0.3)	$	1.7
Midwest	1.4		0.2		1.5		0.5
Southeast	2.8		2.2		4.2		3.5
South Central	2.9		1.4		4.4		1.9
Southwest	—		0.1		0.1		0.2
West	2.2		9.6		2.5		14.0
	$	8.8	$	13.8	$	12.4	$	21.8
Income before Income Taxes (1)
East	$	73.3	$	45.9	$	133.2	$	83.9
Midwest	23.6		9.5		42.3		20.2
Southeast	187.8		131.0		333.9		243.2
South Central	156.2		119.3		288.9		225.3
Southwest	30.8		18.6		65.3		36.3
West	93.8		76.1		163.5		145.9
	$	565.5	$	400.4	$	1,027.1	$	754.8

_________________

(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 homebuilding segment based on the segment’s cost of sales, while expenses associated with the corporate office are allocated to each homebuilding segment based on the segment’s inventory balances.