Taylor Morrison Home (NYSE: TMHC) reported Q1 EPS of $0.75, in-line with the analyst estimate of $0.75. Revenue for the quarter came in at $1.42 billion versus the consensus estimate of $1.47 billion.

The Company's first quarter included the following results, as compared to the prior-year quarter:

• Net sales orders increased 30 percent to 4,492.
• Monthly absorptions increased 42 percent to 4.3 net sales orders per community, a company record high.
• Home closings gross margin increased 320 basis points to 18.6 percent.
• Backlog increased 54 percent to 10,074 sold homes with a sales value of $5.3 billion, up 70 percent.
• Homebuilding lot supply increased four percent to approximately 73,000 total lots owned and controlled.
• Controlled lots as a percentage of total supply increased approximately 400 basis points to 32 percent.

"Our first quarter results, which included strong year-over-year improvement in many of our key operating metrics, reflect the initial benefits of our enhanced scale and local market depth as we continue to execute our strategic plan," said Sheryl Palmer, Taylor Morrison Chairman and CEO. "We achieved a record absorption level of 4.3 net orders per community—a more than 40 percent year-over-year gain—despite taking steps to maximize our margin opportunity and align sales and production paces, reflecting the resiliency of the current demand environment and strength of our consumer-centric product offerings."

"During the quarter, we successfully ramped our construction starts pace by over 70 percent and raised pricing in excess of inflationary costs amid the supply-side pressures facing our industry, positioning us for strong closings and margin expansion in the back half of the year. As a result, we are raising our 2021 gross margin guidance to the low-19 percent range and reaffirming our closings expectation of 14,500 to 15,000 deliveries," said Dave Cone, Executive Vice President and Chief Financial Officer. "Based on our outlook for strong cash flow generation, we remain on track to achieve our targeted net debt-to-capital ratio in the low-30 percent range by year-end and expect further deleveraging in 2022."

"Combined with remarkable strength in the housing market, our focus on operational excellence and capital efficiency is expected to drive our returns on equity to the mid-teens range in 2021 followed by further expansion in 2022 as we begin to fully capture the synergies from our multiple acquisitions, core strategies and digital innovations. To the latter point, we recently expanded our suite of virtual selling tools with the launch of our industry-first to-be-built online home configuration and reservation system. Our innovative digital capabilities allow us to serve our customers even more efficiently while empowering them to take control of their homebuying journey on their own terms," said Palmer.

Business Outlook

Second Quarter 2021

• Average active community count is expected to be approximately 330
• Home closings are expected to be between 3,200 to 3,400
• GAAP home closings gross margin is expected to be generally flat sequentially in the mid-18 percent range
• Effective tax rate is expected to be approximately 23.0 percent
• Diluted share count is expected to be approximately 130 million

Full Year 2021

• Average active community count is expected to be approximately 330
• Home closings are expected to be between 14,500 to 15,000
• GAAP home closings gross margin is expected to be in the low-19 percent range
• SG&A as a percentage of home closings revenue is expected to be in the mid-nine percent range
• Effective tax rate is expected to be approximately 23.0 percent
• Diluted share count is expected to be approximately 130 million
• Land and development spend is expected to be approximately $2.0 billion

For earnings history and earnings-related data on Taylor Morrison Home (TMHC) click here.