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M/I Homes Inc

M/I Homes Reports 2024 Third Quarter Results

COLUMBUS, Ohio , Oct. 30, 2024 /PRNewswire/ -- M/I Homes, Inc. (NYSE: MHO) announced results for the three and nine months ended September 30, 2024.

2024  Third Quarter Highlights:

  • Record third quarter homes delivered, revenue, and income
  • Homes delivered increased 8% to 2,271
  • Revenue increased 9% to $1.1 billion
  • Pre-tax income increased 6% to $188.7 million, 16.5% of revenue
  • Net income increased 5% to $145.4 million ($5.10 per diluted share)
  • Shareholders' equity reached an all-time record $2.8 billion, a 17% increase from a year ago, with book value per share of $105
  • New contracts were 2,023, compared to 2,021 in last year's third quarter
  • Repurchased $50 million of common stock
  • Return on equity of 20%

The Company reported pre-tax income of $188.7 million and net income of $145.4 million ($5.10 per diluted share), both third quarter records. This compares to pre-tax income of $178.0 million and net income of $139.0 million, or $4.82 per diluted share, for the third quarter of 2023. For the nine months ended September 30, 2024, pre-tax income increased to a record $563.1 million and net income increased to a record $430.3 million, or $14.99 per diluted share, compared to $469.3 million and $360.1 million, or $12.58 per diluted share, for the same period of 2023, respectively.

Homes delivered in 2024's third quarter increased 8% to a third quarter record of 2,271 homes. This compares to 2,096 homes delivered in 2023's third quarter. Homes delivered for the nine months ended September 30, 2024 increased 9% to 6,653 from 2023's deliveries of 6,093 which represents an all-time record. New contracts were 2,023 for the third quarter of 2024 compared to 2,021 in last year's third quarter. For the first nine months of 2024, new contracts increased 7% to 6,825 compared to 6,389 in 2023. Homes in backlog at September 30, 2024 had a total sales value of $1.73 billion, a 1% decrease from a year ago. Backlog units at September 30, 2024 decreased 8% to 3,174 homes, with an all-time record average sales price of $544,000. At September 30, 2023, backlog sales value was $1.75 billion, with backlog units of 3,433 and an average sales price of $510,000. M/I Homes had 217 communities at September 30, 2024 compared to 204 communities at September 30, 2023. The Company's cancellation rate was 10% in both the third quarter of 2024 and the third quarter of 2023.

Robert H. Schottenstein, Chief Executive Officer and President, commented, "We had a very strong third quarter, highlighted by record homes delivered, record revenue, and record income. We increased homes delivered by 8% to a record 2,271, increased revenue by 9% to a record $1.1 billion, increased pre-tax income by 6% to a record $188.7 million and we continued to generate strong returns. Pre-tax income equaled 16.5% of revenue. Our gross margin was strong at 27% and our return on equity was 20%.

Mr. Schottenstein continued, "Our financial condition is excellent. We ended the quarter with record shareholders' equity of $2.8 billion, an increase of 17% from a year ago, book value of $105 per share, cash of $720 million, a homebuilding debt to capital ratio of 20%, and a net-debt-to-capital ratio of negative 1%. Given our performance through three quarters of this year, along with the strength of our balance sheet, low debt levels, diverse product offerings and well-located communities, we are positioned to have a very strong 2024."

The Company will broadcast live its earnings conference call today at 10:00 A.M. Eastern Time. To listen to the call live, log on to the M/I Homes' website at mihomes.com, click on the "Investors" section of the site, and select "Listen to the Conference Call."  A replay of the call will continue to be available on our website through October 2025.

M/I Homes, Inc. is one of the nation's leading homebuilders of single-family homes. The Company has homebuilding operations in Columbus and Cincinnati, Ohio; Indianapolis, Indiana; Chicago, Illinois; Minneapolis/St. Paul, Minnesota; Detroit, Michigan; Tampa, Sarasota, Fort Myers/Naples and Orlando, Florida; Austin, Dallas/Fort Worth, Houston and San Antonio, Texas; Charlotte and Raleigh, North Carolina and Nashville, Tennessee.

Certain statements in this press release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects," "anticipates," "targets," "envisions," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," variations of such words and similar expressions are intended to identify such forward-looking statements. These statements involve a number of risks and uncertainties. Any forward-looking statements that we make herein and in any future reports and statements are not guarantees of future performance, and actual results may differ materially from those in such forward-looking statements as a result of various factors, including, without limitation, factors relating to the economic environment, interest rates, availability of resources, competition, market concentration, land development activities, construction defects, product liability and warranty claims and various governmental rules and regulations, as more fully discussed in the "Risk Factors" section of the Company's Annual Report on Form 10-K for the year ended December 31, 2023, as the same may be updated from time to time in our subsequent filings with the Securities and Exchange Commission.  All forward-looking statements made in this press release are made as of the date hereof, and the risk that actual results will differ materially from expectations expressed herein will increase with the passage of time. We undertake no duty to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. However, any further disclosures made on related subjects in our subsequent filings, releases or presentations should be consulted.

M/I Homes, Inc. and Subsidiaries

Summary Statement of Income (unaudited)

(Dollars and shares in thousands, except per share amounts)



Three Months Ended


Nine Months Ended


September 30,


September 30,


2024


2023


2024


2023

New contracts

2,023


2,021


6,825


6,389

Average community count

214


200


215


199

Cancellation rate

10 %


10 %


9 %


11 %

Backlog units

3,174


3,433


3,174


3,433

Backlog sales value

$  1,725,423


$  1,751,442


$  1,725,423


$  1,751,442

Homes delivered

2,271


2,096


6,653


6,093

Average home closing price

$           489


$           481


$           481


$           486









Homebuilding revenue:








   Housing revenue

$  1,111,389


$  1,008,356


$  3,199,946


$  2,963,500

   Land revenue

1,550


14,424


11,753


23,276

Total homebuilding revenue

$  1,112,939


$  1,022,780


$  3,211,699


$  2,986,776









Financial services revenue

29,970


23,591


87,694


74,138

Total revenue

$  1,142,909


$  1,046,371


$  3,299,393


$  3,060,914









Cost of sales - operations

833,468


764,638


2,397,329


2,286,371

Gross margin

$   309,441


$   281,733


$   902,064


$   774,543

General and administrative expense

68,285


55,867


188,363


162,481

Selling expense

59,163


53,735


171,598


154,686

Operating income

$   181,993


$   172,131


$   542,103


$   457,376

Other income

—


1


—


(34)

Interest income, net of interest expense

(6,680)


(5,834)


(20,948)


(11,893)

Income before income taxes

$   188,673


$   177,964


$   563,051


$   469,303

Provision for income taxes

43,224


38,948


132,795


109,220

Net income

$   145,449


$   139,016


$   430,256


$   360,083









Earnings per share:








Basic

$          5.26


$          4.98


$        15.45


$        12.97

Diluted

$          5.10


$          4.82


$        14.99


$        12.58









Weighted average shares outstanding:








Basic

27,644


27,909


27,857


27,769

Diluted

28,534


28,837


28,703


28,631

 

M/I Homes, Inc. and Subsidiaries

Summary Balance Sheet and Other Information (unaudited)

(Dollars in thousands, except per share amounts)



As of


September 30,


2024


2023

Assets:




Total cash, cash equivalents and restricted cash (1)

$      719,920


$      736,252

Mortgage loans held for sale

242,812


207,181

Inventory:




Lots, land and land development

1,558,300


1,355,622

Land held for sale

3,859


6,881

Homes under construction

1,401,260


1,218,256

Other inventory

169,275


159,769

Total Inventory

$  3,132,694


$  2,740,528





Property and equipment - net

34,714


36,015

Investments in joint venture arrangements

63,095


44,866

Operating lease right-of-use assets

55,259


58,304

Goodwill

16,400


16,400

Deferred income tax asset

15,313


18,019

Other assets

179,650


145,803

Total Assets

$  4,459,857


$  4,003,368





Liabilities:




Debt - Homebuilding Operations:




Senior notes due 2028 - net

$      397,459


$      396,685

Senior notes due 2030 - net

297,243


296,739

Total Debt - Homebuilding Operations

$      694,702


$      693,424





Notes payable bank - financial services operations

235,441


200,619

Total Debt

$      930,143


$      894,043





Accounts payable

256,708


250,937

Operating lease liabilities

56,667


59,433

Other liabilities

370,983


373,243

Total Liabilities

$  1,614,501


$  1,577,656





Shareholders' Equity

2,845,356


2,425,712

Total Liabilities and Shareholders' Equity

$  4,459,857


$  4,003,368





Book value per common share

$        104.59


$          87.10

Homebuilding debt to capital ratio (2)

20 %


22 %



(1)

Includes $0.2 million of restricted cash and cash held in escrow for the quarter ended September 30, 2023.

(2)

The ratio of homebuilding debt to capital is calculated as the carrying value of our homebuilding debt outstanding divided by the sum of the carrying value of our homebuilding debt outstanding plus shareholders' equity.

 

M/I Homes, Inc. and Subsidiaries

Selected Supplemental Financial and Operating Data (unaudited)

(Dollars in thousands)



Three Months Ended


Nine Months Ended


September 30,


September 30,


2024


2023


2024


2023

Cash (used in) provided by operating activities

$        (67,942)


$         79,541


$         75,341


$       497,230

Cash used in by investing activities

$        (17,496)


$        (11,330)


$        (45,037)


$        (14,132)

Cash used in financing activities

$        (32,100)


$             (246)


$        (43,188)


$        (58,388)









Land/lot purchases

$       138,711


$       105,860


$       365,553


$       247,574

Land development spending

$       180,753


$       151,222


$       444,659


$       352,555

Land sale revenue

$            1,550


$         14,424


$         11,753


$         23,276

Land sale gross profit

$                 72


$            2,115


$            3,318


$            3,004









Financial services pre-tax income

$         12,936


$            9,878


$         39,648


$         33,678

 

M/I Homes, Inc. and Subsidiaries

Non-GAAP Financial Results (1)

(Dollars in thousands)



Three Months Ended


Nine Months Ended


September 30,


September 30,


2024


2023


2024


2023

Net income

$       145,449


$       139,016


$       430,256


$       360,083

Add:








Provision for income taxes

43,224


38,948


132,795


109,220

Interest income - net

(10,089)


(8,469)


(30,542)


(19,122)

Interest amortized to cost of sales

7,632


8,778


23,872


25,552

Depreciation and amortization

4,816


4,227


13,890


12,890

Non-cash charges

6,750


2,682


14,099


7,056

Adjusted EBITDA

$       197,782


$       185,182


$       584,370


$       495,679



(1)

We believe these non-GAAP financial measures are relevant and useful to investors in understanding our operations and may be helpful in comparing us with other companies in the homebuilding industry to the extent they provide similar information. These non-GAAP financial measures should be used to supplement our GAAP results in order to provide a greater understanding of the factors and trends affecting our operations.

 

M/I Homes, Inc. and Subsidiaries

Selected Supplemental Financial and Operating Data



NEW CONTRACTS



Three Months Ended



Nine Months Ended



September 30,



September 30,







%







%

Region


2024


2023


Change



2024


2023


Change

Northern


890


885


1 %



3,054


2,662


15 %

Southern


1,133


1,136


— %



3,771


3,727


1 %

Total


2,023


2,021


— %



6,825


6,389


7 %



HOMES DELIVERED



Three Months Ended



Nine Months Ended



September 30,



September 30,







%







%

Region


2024


2023


Change



2024


2023


Change

Northern


1,015


741


37 %



2,809


2,321


21 %

Southern


1,256


1,355


(7) %



3,844


3,772


2 %

Total


2,271


2,096


8 %



6,653


6,093


9 %




BACKLOG



September 30, 2024



September 30, 2023





Dollars


Average





Dollars


Average

Region


Units


(millions)


Sales Price



Units


(millions)


Sales Price

Northern


1,493


$            803


$    538,000



1,397


$           727


$   521,000

Southern


1,681


$            923


$    549,000



2,036


$        1,024


$   503,000

Total


3,174


$        1,726


$    544,000



3,433


$        1,751


$   510,000




LAND POSITION SUMMARY



September 30, 2024



September 30, 2023



Lots


Lots Under





Lots


Lots Under



Region


Owned


Contract


Total



Owned


Contract


Total

Northern


6,528


10,885


17,413



7,341


8,385


15,726

Southern


17,114


17,678


34,792



15,835


13,267


29,102

Total


23,642


28,563


52,205



23,176


21,652


44,828

 

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SOURCE M/I Homes, Inc.