NEWPORT BEACH, Calif.--(BUSINESS WIRE)--May 9, 2016-- William Lyon Homes (NYSE: WLH) announced results for its 2016 first quarter ended March 31, 2016.
2016 First Quarter Highlights (Comparison to 2015 First Quarter):
- Net income available to common stockholders of $9.0 million, up 35%, or $0.24 per diluted share, up 32%
- Home sales revenue of $261.3 million, up 38%
- Consolidated revenue of $264.4 million, up 34%
- New home deliveries of 543 homes, up 40%
- Net new home orders of 689, up 17%
- Dollar value of orders of $334.5 million, up 25%
- Average sales locations of 69, up 28%
- Units in backlog of 885, up 31%
- Dollar value of homes in backlog of $471.7 million, up 41%
- Average sales price (ASP) of new homes delivered of $481,200
- Home building gross margin of $46.1 million, up 29%
- Home building gross margin percentage of 17.7%
- Adjusted home building gross margin percentage of 24.7%
- SG&A percentage of 12.5%, compared to 13.8%
- Adjusted EBITDA of $33.5 million, up 46%
“We are very pleased to have started the year with continued positive operating momentum,” said Matthew R. Zaist, President and Chief Executive Officer. “Home sales revenue increased by 38% to $261.3 million and deliveries increased by 40% to 543 units, resulting in a 35% increase in net income available to common stockholders of $9.0 million, or $0.24 per diluted share. Our ongoing focus on our strategic initiatives resulted in continued year-over-year improvement in virtually all of our key operating and financial metrics.”
Mr. Zaist continued, “We delivered another quarter of year-over-year improvement in net new home orders, which increased by 17% to 689, and the number and dollar value of our backlog, which grew to 885 homes and $471.7 million, up 31% and 41%, respectively. We are experiencing an orderly progression of new home sales and absorption rates throughout the spring selling season, as orders picked up momentum on a month-over-month basis throughout the quarter. This momentum has continued into the second quarter of 2016, where April’s absorption pace was the strongest of the year at 4.3 net sales per community, resulting in 291 net new home orders for the month. We continue to focus on new community openings and currently expect to open approximately 17 new home communities during the second quarter, with the bulk of these openings occurring in May and June, and expect to end the second quarter of 2016 selling out of approximately 80 new home communities.”
Home sales revenue for the first quarter of 2016 was $261.3 million, as compared to $189.7 million in the year-ago period, an increase of 38%. Our performance was driven by a 40% increase in the number of deliveries to 543 homes, compared to 388 homes delivered in the first quarter of 2015. Average sales price of homes delivered was $481,200 in the quarter, compared to $489,000 in the year-ago period. The slight decline in ASP primarily reflects changes in geographic and product mix contributing to closings during the quarter.
The dollar value of orders for the first quarter of 2016 was $334.5 million, an increase of 25%, from $268.2 million in the year-ago period. Net new home orders for the quarter were 689, up 17% from 588 in the first quarter of 2015. The overall increase in net new home orders was primarily driven by an increase in community count to 69 average sales locations, from 54 in the year-ago period, offset by a modest decline in absorption from 3.6 sales per month in the year-ago period to 3.3 sales per month in the current period. For the quarter, we saw monthly absorption rates range from a low of 2.8 sales per community in January to a high of 3.8 sales per community in March.
The dollar value of homes in backlog was $471.7 million as of March 31, 2016, an increase of 41% compared to $335.1 million as of March 31, 2015. The increase was driven by both a 31% increase in units in backlog to 885 from 678 and an 8% increase in ASP in backlog to $533,000 from $494,200 in the year-ago period.
Adjusted home building gross margin percentage was 24.7% during the first quarter of 2016. Home building gross margins for the first quarter of 2016 were 17.7%.
Sales and marketing expense during the first quarter of 2016 was 5.7% of home building revenue, compared to 6.4% in the year-ago quarter, driven primarily by higher home building revenue and leverage on our advertising and marketing costs, compared to the prior year period. General and administrative expenses decreased to 6.8% of home building revenue, compared to 7.4% in the year-ago quarter, as we benefited from a lower relative cost structure due to positive operating leverage.
Balance Sheet Update
At quarter end, cash, cash equivalents and restricted cash totaled $36.3 million, real estate inventories totaled $1.8 billion, total assets were $2.0 billion and total equity was $714 million. Net debt to net book capitalization was 60.2%, and total debt to total book capitalization was 61.0% at March 31, 2016, compared to 61.1% and 62.2%, respectively, as of December 31, 2015.