A strong spring selling season translated into strong quarters for Beazer Homes, Green Brick Partners, and Landsea Homes.
Beazer Homes bested projections for profits per share and recorded strong sales, margins, and community count growth in the second quarter. For Green Brick Partners, the public company reported record profits per share and margin as well as its second-highest quarterly sales orders in company history. While Landsea Homes missed analyst projections for the quarter, the home builder reported strong home sales revenue growth, order growth, and deliveries during its fiscal first quarter.
Beazer Homes
In the fiscal second quarter, ended March 31, Beazer Homes generated profit of $39.2 million, or $1.26 per share, compared with $34.7 million, or $1.13 per share, in the prior-year period.
“While affordability remains challenging, especially in light of the recent increase in mortgage rates, the relatively strong economy and lack of resale inventory leave us on track to achieve our full-year profitability and double-digit return on equity goals for the fiscal year,” said Allan Merrill, chairman and CEO of Beazer Homes.
The builder generated a home building revenue of $538.6 million in the period on a 1.8% decline in home closings to 1,044 and a 1.2% increase in average selling price to $515,900. Net orders in the period increased 10% to 1,299 on a 13.8% increase in average community count to 140.
Beazer Homes ended the quarter with 2,046 units in backlog valued at $1.08 billion, increases of 10.1% and 8.9%, respectively.
“We remain optimistic for the years ahead given the persistent undersupply of housing and our consistent advancement toward our multi-year goals,” Merrill said. “Further growth in community count, combined with reductions in leverage and the full implementation of our Zero Energy Ready program, should position us to generate durable value for our shareholders.”
Green Brick Partners
The highlight of Green Brick Partners’ “excellent” first quarter results was a 32.8% year-over-year increase in profits per share to a company-record $1.82. Additionally, the company delivered 821 homes in the period, an increase of 7.9% on a year-over-year basis. Green Brick generated $443.1 million in home closings revenue during the period.
“Our advantages in infill and infill-adjacent locations and self-development strategy produced a record home building gross margin of 33.4%,” Jim Brickman, CEO and co-founder of Green Brick Partners, said. “More important, our accomplishments were achieved with a balance sheet that is stronger than ever.”
Green Brick delivered 1,071 net orders in the quarter, its second highest quarterly sales orders in company history. The home builder’s absorption rate per average community was 3.8 per month in the second quarter.
“We were also able to reduce overall average incentive rates from 5.6% of sales price in the fourth quarter of 2023 to 3.8% in March 2024,” Brickman said. “Our cancellation rate dropped to 4.1%.”
The home builder grew its backlog 30.7% sequentially to $725 million, or 1,020 units. Green Brick Partners increased its starts cadence to 997 homes in the first quarter and grew community count 24.1% year over year to 98.
Landsea Homes
Landsea Homes reported 22% year-over-year growth in home sales revenue to $294 million and 23% year-over-year growth in net new-home orders to 612 in the fiscal first quarter.
“New-home deliveries came above the high end of our guidance range at 505, while average selling price increased 14% year over year to $579,000,” president and CEO John Ho said. “We also generated 612 net new orders during the quarter on a sales pace of 3.3 homes per community per month.”
The home builder said solid demand trends emerged in the spring, supported by the continued lack of existing-home inventory.
“The recent rise in interest rates has created some challenges on the affordability front, but we have and will continue to address those issues through the use of interest rate buydowns and other financing incentives,” Ho said.
Landsea ended the quarter with 624 homes in backlog, representing a dollar value of $384.3 million. A year ago, the builder had 696 homes in backlog, representing a dollar value of $422.9 million. The company reported a profit of $2 million in the first quarter, or $0.06 per share, compared with first quarter 2023 profits of $7.1 million, or $0.18 per share.
