COLUMBUS, Ohio (Hanley-Wood News Service) - M/I Schottenstein Homes Inc. (NYSE: MHO) reports record financial results for the fourth quarter and year ended December 31, 2001. Net income of $14,765,000 in 2001's fourth quarter, a 19% increase over 2000's fourth quarter earnings of $12,452,000, and $55,282,000 for the year, a 24% increase over the $44,444,000 earned for the year 2000, were record income levels for these periods in M/I's 25-year history. Diluted earnings per share for 2001's fourth quarter and year end of $1.91 and $7.12 increased 20% and 29%, respectively, over 2000's fourth quarter and year end diluted earnings per share of $1.59 and $5.52. M/I Homes also achieved record highs in New Contracts for the year, Homes Delivered for the quarter and year as well as backlog units, sales value and average sales price at December 31, 2001.
Irving E. Schottenstein, CEO, stated, ''2001 was yet another record-breaking year for M/I Homes. We are proud to report the highest income, revenue, new contracts and homes delivered in our history. Our financial strength is evidenced by stockholders' equity of $280,000,000 and book value per share over $37. We are also very pleased that 2001's customer service rating of 99% marked the eleventh consecutive year of exceeding 95%. This is how you build a business.''
Robert H. Schottenstein, president, remarked, ''Gross margins have increased to over 22% while operating margins exceeded 10%. In addition, our year end backlog was at a record level of $559,000,000. Achievements such as these are the result of our focus on customer service and profitability. Our goal for 2002 is to continue our string of six consecutive record income years. With our record year end backlog of $559,000,000, the solid margins in our backlog, and anticipation of strong 2002 first half new orders, we project 2002's diluted earnings per share to exceed $7.25.'' Mr. Schottenstein also announced that the Company is exiting the Phoenix market, where it has closed less than 100 homes annually. Phoenix operations consisted primarily of custom housing, with sales prices exceeding $700,000. Though profitable, M/I is discontinuing this business in order to focus on its core business in other markets where meaningful growth opportunities exist. This decision should not significantly impact financial results or financial condition.
M/I's record fourth quarter deliveries of 1,303 were up 8% from the 1,209 homes delivered in 2000's fourth quarter. Homes Delivered of 4,227 in 2001 were up 4% from 2000's 4,070. New Contracts of 951 were recorded in 2001's fourth quarter, a 4% increase from the 914 New Contracts recorded in 2000's fourth quarter. For the year 2001, M/I had a record 4,447 New Contracts, 10% above 2000's 4,027. The Backlog of homes at December 31, 2001 was a record 2,331 units, with a sales value of $559,000,000 compared to 2,111 units (sales value of $492,000,000) at December 31, 2000. The average sales price of homes in Backlog was a record $240,000 at December 31 2001, compared with $233,000 at December 31, 2000. M/I had 145 active subdivisions at December 31, 2001 compared to 142 at December 31, 2000.
Effective January 1, 2001, the Company adopted SFAS No. 133, ''Accounting for Derivative Instruments and Hedging Activities,'' which resulted in income of $2,681,000, net of tax, for the year ended December 31, 2001. This pronouncement affected M/I's mortgage operations and effectively required recording the value of certain loan commitments and forward sales of mortgage backed securities in the first quarter.
The company's homes are marketed and sold under the trade names Horizon, M/I Homes and Showcase Homes. The Company has homebuilding operations in Columbus and Cincinnati, Ohio; Indianapolis, Indiana; Tampa, Orlando and Palm Beach County, Florida; Charlotte and Raleigh, North Carolina; Virginia; Maryland; and Phoenix, Arizona.