William Lyon Homes (WLH) Tops Q1 EPS by 6c, Beats on Revenues

William Lyon Homes (NYSE: WLH) reported Q1 EPS of $0.24, $0.06 better than the analyst estimate of $0.18. Revenue for the quarter came in at $374.4 million versus the consensus estimate of $328.28 million.

2018 First Quarter Highlights (Comparison to 2017 First Quarter)

• Net income available to common stockholders of $8.3 million, or $0.21 per diluted share
• Adjusted net income available to common stockholders of $10.9 million, or $0.27 per diluted share, compared to $4.1 million, or $0.11 per diluted share in the prior period, up 167% and 145%, respectively
• Pre-tax income of $15.4 million, up 123%
• Adjusted pre-tax income of $18.5 million, up 169%, which excludes transaction expenses of $3.1 million, before tax
• New home deliveries of 740 homes, up 48%
• Net new home orders of 1,106, up 28%
• Dollar value of orders of $602.7 million, up 33%
• Dollar value of homes in backlog of $752.1 million, up 19%
• Units in backlog of 1,460, up 33%
• Average sales locations of 84, up 2%
• Active sales locations of 105 as of March 31, 2018
• Average sales price (ASP) of new homes delivered of $503,200, down 3%
• Home sales revenue of $372.4 million, up 44%
• Homebuilding gross margin percentage of 17.5%
• Adjusted homebuilding gross margin percentage of 22.7%
• SG&A percentage of 12.7%, compared to 13.0%
• Adjusted EBITDA of $41.7 million, up 108%

“We executed on several strategic initiatives during the first quarter of 2018, including the closing of the RSI acquisition, marking our entry into Texas and enhancing our presence in Southern California, while meaningfully expanding our exposure to the attractive entry-level buyer segment, and executing a high-yield offering to fund a portion of the acquisition purchase price and refinance our nearest term senior notes maturities,” said Matthew R. Zaist, President and Chief Executive Officer. “We also experienced a strong start to the spring selling season and delivered another quarter of year-over-year improvement in net new home orders, which increased 28% to 1,106, and represents a monthly absorption rate of 4.4 net new home orders per community, and an associated dollar value of orders of $602.7 million, a 33% increase over the same period last year. This strong trend continued into April, with 481 net new home orders, or a monthly absorption rate of 4.5.”

Mr. Zaist continued, “We are very pleased with our overall financial results for the quarter, with significant improvements in homebuilding revenues to $372.4 million, up 44%, adjusted pre-tax income of $18.5 million, up 169%, adjusted net income of $10.9 million, up 167%, and adjusted earnings per share on a diluted basis of $0.27, up 145%.”

Mr. Zaist added, “The strong start to 2018 and strategic execution of the RSI acquisition position us well to achieve our goals for the year, and our expectations for the full year include new home deliveries of approximately 4,400 to 4,750 units, home sales revenue of approximately $2.2 billion to $2.3 billion, and pre-tax income before non-controlling interest of approximately $175 million to $185 million, inclusive of RSI transaction expenses and purchase accounting.”

For earnings history and earnings-related data on William Lyon Homes (WLH) click here.

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