William Lyon Homes (WLH) Tops Q2 EPS by 3c, Beats on Revenues

William Lyon Homes (NYSE: WLH) reported Q2 EPS of $0.58, $0.03 better than the analyst estimate of $0.55. Revenue for the quarter came in at $519.45 million versus the consensus estimate of $507.27 million.

2018 Second Quarter Highlights (Comparison to 2017 Second Quarter)

• Net income available to common stockholders of $22.5 million, or $0.57 per diluted share
• Adjusted net income available to common stockholders of $23.1 million, or $0.58 per diluted share, compared to $19.0 million, or $0.49 per diluted share in the prior period, up 22% and 18%, respectively
• Pre-tax income of $35.0 million, up 19%
• Adjusted pre-tax income of $35.8 million, up 21%, which excludes transaction expenses of $0.8 million, before tax
• New home deliveries of 1,082 homes, up 30%
• Net new home orders of 1,270, up 25%
• Dollar value of orders of $623.1 million, up 12%
• Units in backlog of 1,648, up 28%
• Dollar value of homes in backlog of $867.7 million, up 15%
• Average sales locations of 107, up 22%
• Average sales price (ASP) of new homes delivered of $479,100, down 6%
• Home sales revenue of $518.4 million, up 23%
• Homebuilding gross margin percentage of 17.9%
• Adjusted homebuilding gross margin percentage of 23.3%
• SG&A percentage of 11.1%, compared to 9.7%
• Adjusted EBITDA of $62.4 million, up 25%

“We are pleased with our financial results for the second quarter, with several key metrics up over the prior year, including homebuilding revenues of $518.4 million, up 23%, new home deliveries of 1,082, up 30%, adjusted pre-tax income of $35.8 million, up 21%, adjusted net income of $23.1 million, up 22%, and adjusted earnings per share on a diluted basis of $0.58, up 18%,” said Matthew R. Zaist, President and Chief Executive Officer. “During the quarter, our GAAP homebuilding gross margins were 17.9%, including purchase accounting adjustments from the RSI acquisition, up 140 basis points compared to the second quarter of 2017, and up 40 basis points sequentially from the first quarter of this year.”

Mr. Zaist continued, “We also delivered another quarter of year-over-year improvement in net new home orders, which increased 25% to 1,270, and represents a monthly absorption rate of 4.0 net new home orders per community compared to 3.9 in the year-ago period. The increase in monthly absorption rate year-over-year was driven by an improvement in both May and June absorption rates.”

Mr. Zaist added, “The strong performance in the first half of 2018 positions us well to achieve our goals for the year, and our updated expectations for the full year include new home deliveries of approximately 4,400 to 4,700 units, home sales revenue of approximately $2.25 billion to $2.35 billion, and pre-tax income before non-controlling interest of approximately $175 million to $185 million.”

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

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