MIAMI, Sept. 21, 2015 /PRNewswire/ --
- Net earnings of $223.3
million, or $0.96 per diluted
share, compared to net earnings of $177.8
million, or $0.78 per diluted
share
- Deliveries of 6,318 homes – up 16%
- New orders of 6,495 homes – up 10%; new orders dollar value
of $2.3 billion – up
20%
- Backlog of 8,250 homes – up 13%; backlog dollar value of
$3.0 billion – up 22%
- Revenues of $2.5 billion – up
24%
- Lennar Homebuilding operating earnings of $333.7 million, compared to $261.9 million – up 27%
- Operating metrics in this segment were in line with the
Company's previously stated goals:
- Gross margin on home sales of 24.1%, compared to 25.2% in Q3
2014, improved sequentially 30 basis points from Q2 2015
- S,G&A expenses as a % of revenues from home sales
improved to 9.9%, compared to 10.4% in Q3 2014 and 10.0% in Q2
2015
- Operating margin on home sales of 14.1%, compared to 14.8%
in Q3 2014, improved sequentially 30 basis points from Q2
2015
- Lennar Financial Services operating earnings of $39.4 million, compared to $27.1 million
- Rialto operating earnings (net of noncontrolling interests)
of $9.0 million, compared to
$12.4 million
- Lennar Multifamily operating loss of $3.0 million, compared to operating earnings of
$8.5 million
- Formation of the Lennar Multifamily Venture with
$1.1 billion in equity commitments
($504 million committed by
Lennar)
- Lennar Homebuilding cash and cash equivalents of
$596 million
- Exchanged or converted $169
million of the 2.75% convertible senior notes due
2020
- Lennar Homebuilding debt to total capital, net of cash and
cash equivalents, of 46.5%
Lennar Corporation (NYSE: LEN and LEN.B), one
of the nation's largest homebuilders, today reported results
for its third quarter ended August 31, 2015. Third quarter net
earnings attributable to Lennar in 2015 were $223.3 million, or $0.96 per diluted share, compared to third
quarter net earnings attributable to Lennar in 2014 of $177.8 million, or $0.78 per diluted share.
Stuart Miller, Chief Executive
Officer of Lennar Corporation, said, "During the third quarter, the
housing market continued to improve in its slow and steady manner,
as demonstrated in the past few years. The new home and rental
markets continued to have significant pent-up demand, which
positions us well for years to come. This demand is driven
primarily by a large production deficit built up over the last
several years, an increasing millennial population, reasonable
affordability levels and high-rental occupancy rates."
Mr. Miller continued, "Our core homebuilding business continued
to produce strong operating results in the third
quarter. Gross and operating margins were 24.1% and 14.1% in
the third quarter, respectively. Our average sales price of homes
delivered increased 5% year-over-year to $350,000, from $332,000 in the third quarter of 2014. Our new
home deliveries increased 16% in the third quarter, while our new
home orders increased a solid 10%, compared to the same period last
year. Our sales backlog dollar value increased 22% from the third
quarter of last year to approximately $3.0
billion, keeping us well positioned going forward.
"Complementing our homebuilding business, our Lennar Financial
Services segment continued its strong performance by increasing its
earnings to $39.4 million in the
third quarter from $27.1 million in
the third quarter of 2014. The segment continues to grow its core
earnings as our purchase volume increased as a result of increased
Lennar home deliveries and our expanded retail
presence. Additionally, the segment benefited from a strong,
but more transient, refinance market.
"Our Rialto segment generated $9.0
million of income and continues to emerge as a best-in-class
asset manager. Rialto's fund investments are poised for strong
long-term returns and its mortgage conduit business continues to
produce steady, current earnings.
"Our multifamily rental segment has continued to mature with a
geographically diversified pipeline. As previously announced
during the quarter, we further defined this platform by forming
Lennar Multifamily Venture, an equity venture with global sovereign
and institutional investors. This venture now gives us the ability
to recognize current development earnings and to continue to own a
portfolio of income producing properties."
Mr. Miller concluded, "We continue to execute our
carefully-crafted strategy across all of our businesses. While our
homebuilding business continues to be the primary driver of our
quarterly earnings, we are in an excellent position across our
multiple platforms."
RESULTS OF OPERATIONS
THREE MONTHS ENDED AUGUST 31,
2015 COMPARED TO THREE MONTHS ENDED AUGUST 31, 2014
Lennar Homebuilding
Revenues from home sales increased 22% in the third quarter of
2015 to $2.2 billion from
$1.8 billion in the third quarter of
2014. Revenues were higher primarily due to a 16% increase in the
number of home deliveries, excluding unconsolidated entities, and a
5% increase in the average sales price of homes delivered. New home
deliveries, excluding unconsolidated entities, increased to 6,314
homes in the third quarter of 2015 from 5,450 homes in the third
quarter of 2014. There was an increase in home deliveries in all of
the Company's Homebuilding segments, except in Southeast Florida and in Homebuilding Other.
The average sales price of homes delivered increased to
$350,000 in the third quarter of 2015
from $332,000 in the third quarter of
2014. Sales incentives offered to homebuyers were $20,700 per home delivered in the third quarter
of 2015, or 5.6% as a percentage of home sales revenue, compared to
$20,400 per home delivered in the
third quarter of 2014, or 5.8% as a percentage of home sales
revenue, and $21,500 per home
delivered in the second quarter of 2015, or 5.8% as a percentage of
home sales revenue.
Gross margins on home sales were $531.4
million, or 24.1%, in the third quarter of 2015, compared to
$456.2 million, or 25.2%, in the
third quarter of 2014. Gross margin percentage on home sales
decreased primarily due to an increase in land costs, partially
offset by an increase in the average sales price of homes
delivered. Gross profits on land sales were $6.7 million in the third quarter of 2015,
compared to $4.3 million in the third
quarter of 2014.
Selling, general and administrative expenses were $219.0 million in the third quarter of 2015,
compared to $188.0 million in the
third quarter of 2014. As a percentage of revenues from home sales,
selling, general and administrative expenses improved to 9.9% in
the third quarter of 2015, from 10.4% in the third quarter of 2014
primarily due to improved operating leverage as a result of an
increase in home deliveries.
Lennar Homebuilding equity in earnings (loss) from
unconsolidated entities was $13.3
million in the third quarter of 2015, compared to
($2.1) million in the third quarter
of 2014. In the third quarter of 2015, Lennar Homebuilding equity
in earnings from unconsolidated entities included $21.5 million of equity in earnings from El Toro,
one of the Company's unconsolidated entities, due to a gain on debt
extinguishment and the sale of homesites to a third party. This was
partially offset by the Company's share of net operating losses
from various Lennar Homebuilding unconsolidated entities. In the
third quarter of 2014, Lennar Homebuilding equity in loss from
unconsolidated entities related to the Company's share of net
operating losses from various Lennar Homebuilding unconsolidated
entities.
Lennar Homebuilding interest expense was $58.9 million in the third quarter of 2015
($55.5 million was included in cost
of homes sold, $0.6 million in cost
of land sold and $2.8 million in
other interest expense), compared to $51.4
million in the third quarter of 2014 ($42.6 million was included in cost of homes sold,
$0.4 million in cost of land sold and
$8.4 million in other interest
expense). Interest expense increased primarily due to an increase
in the Company's outstanding debt and an increase in home
deliveries, partially offset by an increase in qualifying assets
eligible for interest capitalization and lower borrowing costs.
Lennar Financial Services
Operating earnings for the Lennar Financial Services segment
were $39.4 million in the third
quarter of 2015, compared to $27.1
million in the third quarter of 2014. The increase in
profitability was primarily due to an increase in mortgage
originations driven by a stronger refinance market and an increase
in purchase volume as a result of increased Lennar home deliveries
and an increase in purchase mortgages originated for non-Lennar
homebuyers. The increase in volume also benefited the title
operations.
Rialto
Operating earnings for the Rialto segment were $9.0 million in the third quarter of 2015 (which
included $7.0 million of operating
earnings and an add back of $2.0
million of net loss attributable to noncontrolling
interests), compared to operating earnings of $12.4 million in the third quarter of 2014 (which
included $7.8 million of operating
earnings and an add back of $4.5
million of net loss attributable to noncontrolling
interests).
Revenues in this segment were $51.6
million in the third quarter of 2015, compared to
$40.8 million in the third quarter of
2014. Revenues increased primarily due to the receipt of
$5.0 million of advanced
distributions with regard to Rialto's carried interests in the
Rialto real estate funds in order to cover income tax obligations
resulting from allocations of taxable income due to Rialto's
carried interests in these funds and an increase in securitization
revenue and interest income from Rialto Mortgage Finance
("RMF").
Expenses in this segment were $53.3
million in the third quarter of 2015, compared to
$47.6 million in the third quarter of
2014. Expenses increased primarily due to an increase in RMF
securitization expenses and other general and administrative
expenses.
Rialto equity in earnings from unconsolidated entities was
$7.6 million and $20.0 million in the third quarter of 2015 and
2014, respectively, primarily related to the segment's share of
earnings from the Rialto real estate funds. The decrease in equity
in earnings was related to lower fair value adjustments of certain
assets in the Rialto real estate funds in the third quarter of 2015
than in the same period last year.
Lennar Multifamily
Operating earnings (loss) for the Lennar Multifamily segment was
($3.0) million in the third quarter
of 2015, compared to $8.5 million in
the third quarter of 2014. In the third quarter of 2015, the
operating loss primarily related to general and administrative
expenses, partially offset by management fee income and by the
segment's $5.7 million share of a
gain as a result of the sale of an operating property by one of
Lennar Multifamily's unconsolidated entities. In the third quarter
of 2014, operating earnings primarily related to the segment's
$14.7 million share of gains as a
result of the sale of two operating properties by Lennar
Multifamily unconsolidated entities and management fee income,
partially offset by general and administrative expenses.
During the third quarter of 2015, the Lennar Multifamily segment
completed the closing of the Lennar Multifamily Venture (the
"Venture") for the development, construction and property
management of class-A multifamily assets. With the first close, the
Venture will have approximately $1.1
billion of equity commitments, including a $504 million co-investment commitment by Lennar,
comprised of cash, undeveloped land and preacquisition costs. It
will be seeded with 19 undeveloped multifamily assets that were
previously purchased or under contract by the Lennar Multifamily
segment, totaling 6,120 apartments.
Corporate General and Administrative Expenses
Corporate general and administrative expenses were $56.5 million, or 2.3% as a percentage of total
revenues, in the third quarter of 2015, compared to $43.1 million, or 2.1% as a percentage of total
revenues, in the third quarter of 2014.
Noncontrolling Interests
Net earnings (loss) attributable to noncontrolling interests
were $1.7 million and ($4.3) million in the third quarter of 2015 and
2014, respectively. Net earnings attributable to noncontrolling
interests during the third quarter of 2015 were primarily
attributable to earnings related to Lennar Homebuilding
consolidated joint ventures, partially offset by a net loss related
to the FDIC's interest in the portfolio of real estate loans that
the Company acquired in partnership with the FDIC. Net loss
attributable to noncontrolling interests during the third quarter
of 2014 was primarily related to the FDIC's interest in the
portfolio of real estate loans that the Company acquired in
partnership with the FDIC.
NINE MONTHS ENDED AUGUST 31,
2015 COMPARED TO NINE MONTHS ENDED AUGUST 31, 2014
Lennar Homebuilding
Revenues from home sales increased 25% in the nine months ended
August 31, 2015 to $5.7 billion from $4.6
billion in the nine months ended August 31, 2014. Revenues were higher primarily
due to an 18% increase in the number of home deliveries, excluding
unconsolidated entities, and a 6% increase in the average sales
price of homes delivered. New home deliveries, excluding
unconsolidated entities, increased to 16,604 homes in the nine
months ended August 31, 2015 from
14,023 homes in the nine months ended August
31, 2014. There was an increase in home deliveries in all of
the Company's Homebuilding segments and Homebuilding Other. The
average sales price of homes delivered increased to $343,000 in the nine months ended August 31, 2015 from $325,000 in the nine months ended August 31, 2014. Sales incentives offered to
homebuyers were $21,300 per home
delivered in the nine months ended August
31, 2015, or 5.8% as a percentage of home sales revenue,
compared to $20,600 per home
delivered in the nine months ended August
31, 2014, or 6.0% as a percentage of home sales revenue.
Gross margins on home sales were $1.4
billion, or 23.7%, in the nine months ended August 31, 2015, compared to $1.2 billion, or 25.3%, in the nine months ended
August 31, 2014. Gross margin
percentage on home sales decreased primarily due to an increase in
land costs, partially offset by an increase in the average sales
price of homes delivered. Gross margin on home sales in the nine
months ended August 31, 2014 included
$15.1 million of insurance recoveries
and other nonrecurring items, which increased the gross margin
percentage by 30 basis points. Gross profits on land sales totaled
$22.2 million in the nine months
ended August 31, 2015, compared to
$26.1 million in the nine months
ended August 31, 2014.
Selling, general and administrative expenses were $588.4 million in the nine months ended
August 31, 2015, compared to
$496.3 million in the nine months
ended August 31, 2014. As a
percentage of revenues from home sales, selling, general and
administrative expenses improved to 10.3% in the nine months ended
August 31, 2015, from 10.9% in the
nine months ended August 31, 2014
primarily due to improved operating leverage as a result of an
increase in home deliveries.
Lennar Homebuilding equity in earnings from unconsolidated
entities was $48.7 million in the
nine months ended August 31, 2015,
compared to $3.3 million in the nine
months ended August 31, 2014. In the
nine months ended August 31, 2015,
Lennar Homebuilding equity in earnings from unconsolidated entities
included $64.5 million of equity in
earnings from El Toro, one of the Company's unconsolidated
entities, due to the sale of approximately 700 homesites and a
commercial property to third parties and a gain on debt
extinguishment. This was partially offset by the Company's share of
net operating losses from various Lennar Homebuilding
unconsolidated entities. In the nine months ended August 31, 2014, Lennar Homebuilding equity in
earnings from unconsolidated entities included $4.7 million primarily related to third-party
land sales by one of the Company's unconsolidated entities,
partially offset by the Company's share of net operating losses
from various Lennar Homebuilding unconsolidated entities.
Lennar Homebuilding interest expense was $154.6 million in the nine months ended
August 31, 2015 ($142.3 million was included in cost of homes
sold, $1.7 million in cost of land
sold and $10.7 million in other
interest expense), compared to $141.6
million in the nine months ended August 31, 2014 ($107.6
million was included in cost of homes sold, $2.6 million in cost of land sold and
$31.4 million in other interest
expense). Interest expense increased primarily due to an increase
in the Company's outstanding debt and an increase in home
deliveries, partially offset by an increase in qualifying assets
eligible for interest capitalization and lower borrowing costs.
Lennar Financial Services
Operating earnings for the Lennar Financial Services segment
were $94.0 million in the nine months
ended August 31, 2015, compared to
$49.9 million in the nine months
ended August 31, 2014. The increase
in profitability was primarily due to an increase in mortgage
originations driven by a stronger refinance market and an increase
in purchase volume as a result of increased Lennar home deliveries
and an increase in purchase mortgages originated for non-Lennar
homebuyers. The increase in volume also benefited the title
operations.
Rialto
Operating earnings for the Rialto segment were $21.2 million in the nine months ended
August 31, 2015 (which included
$16.7 million of operating earnings
and an add back of $4.5 million of
net loss attributable to noncontrolling interests), compared to
operating earnings of $28.3 million
in the nine months ended August 31,
2014 (which included $7.7
million of operating earnings and an add back of
$20.7 million of net loss
attributable to noncontrolling interests).
Revenues in this segment were $160.7
million in the nine months ended August 31, 2015, compared to $142.2 million in the nine months ended
August 31, 2014. Revenues increased
primarily due to an increase in securitization revenue and interest
income from RMF and the receipt of $16.2
million of advanced distributions with regard to Rialto's
carried interests in the Rialto real estate funds in order to cover
income tax obligations resulting from allocations of taxable income
due to Rialto's carried interests in these funds. This increase was
partially offset by a decrease in interest income as a result of a
decrease in the portfolio of loans Rialto owns because of loan
collections, resolutions and real estate
owned foreclosures and because Rialto no longer recognizes
interest income under the accretable yield method. Instead interest
income is recognized to the extent that loan collections exceed
their carrying value.
Expenses in this segment were $161.6
million in the nine months ended August 31, 2015, compared to $174.8 million in the nine months ended
August 31, 2014. Expenses decreased
primarily due to a $37.4 million
decrease in loan impairments, partially offset by an increase in
other general and administrative expenses, RMF securitization
expenses and interest expense.
Rialto equity in earnings from unconsolidated entities was
$17.6 million and $43.3 million in the nine months ended
August 31, 2015 and 2014,
respectively, primarily related to the segment's share of earnings
from the Rialto real estate funds. The decrease in equity in
earnings was related to lower fair value adjustments of certain
assets in the Rialto real estate funds in the nine months ended
August 31, 2015 than in the same
period last year.
Lennar Multifamily
Operating loss for the Lennar Multifamily segment was
$17.4 million in the nine months
ended August 31, 2015, compared to
$4.9 million in the nine months ended
August 31, 2014. For the nine months
ended August 31, 2015, the operating
loss primarily related to general and administrative expenses,
partially offset by management fee income, net general contractor
income and by the segment's $5.7
million share of a gain as a result of the sale of an
operating property by one of Lennar Multifamily's unconsolidated
entities. For the nine months ended August
31, 2014, the operating loss in Lennar Multifamily primarily
related to general and administrative expenses, partially offset by
the segment's $14.7 million share of
gains as a result of the sale of two operating properties by Lennar
Multifamily unconsolidated entities and management fee income.
Corporate General and Administrative Expenses
Corporate general and administrative expenses were $150.4 million, or 2.3% as a percentage of total
revenues, in the nine months ended August
31, 2015, compared to $119.5
million, or 2.3% as a percentage of total revenues, in the
nine months ended August 31,
2014.
Noncontrolling Interests
Net earnings (loss) attributable to noncontrolling interests
were $5.2 million and ($17.6) million in the nine months ended
August 31, 2015 and 2014,
respectively. Net earnings attributable to noncontrolling interests
during the nine months ended August 31,
2015 were primarily attributable to earnings related to
Lennar Homebuilding consolidated joint ventures, partially offset
by a net loss related to the FDIC's interest in the portfolio of
real estate loans that the Company acquired in partnership with the
FDIC. Net loss attributable to noncontrolling interests during the
nine months ended August 31, 2014
were primarily related to the FDIC's interest in the portfolio of
real estate loans that the Company acquired in partnership with the
FDIC.
Debt Transactions
During the nine months ended August 31,
2015, the Company paid and delivered approximately
$169 million in cash and 4.2 million
shares of Class A common stock on exchange or conversion of
approximately $169 million aggregate
principal amount of its 2.75% convertible senior notes due
2020.
About Lennar
Lennar Corporation, founded in 1954, is one of the nation's
largest builders of quality homes for all generations. The Company
builds affordable, move-up and retirement homes primarily under the
Lennar brand name. Lennar's Financial Services segment provides
mortgage financing, title insurance and closing services for both
buyers of the Company's homes and others. Lennar's Rialto segment
is a vertically integrated asset management platform focused on
investing throughout the commercial real estate capital structure.
Lennar's Multifamily segment is a nationwide developer of
high-quality multifamily rental properties. Previous press releases
and further information about the Company may be obtained at the
"Investor Relations" section of the Company's website,
www.lennar.com.
Note Regarding Forward-Looking Statements: Some of the
statements in this press release are "forward-looking statements,"
as that term is defined in the Private Securities Litigation Reform
Act of 1995, including statements regarding our belief that our
homebuilding business is well positioned for years to come, our
belief that Rialto's fund investments are poised for strong
long-term returns and our belief that we are in excellent positions
across all our multiple platforms. You can identify
forward-looking statements by the fact that these statements do not
relate strictly to historical or current matters. Rather,
forward-looking statements relate to anticipated or expected
events, activities, trends or results. Accordingly, these
forward-looking statements should be evaluated with consideration
given to the many risks and uncertainties inherent in our business
that could cause actual results and events to differ materially
from those in the forward-looking statements. Important factors
that could cause such differences include increases in operating
costs, including costs related to real estate taxes, construction
materials, labor and insurance, and our ability to manage our cost
structure, both in our Lennar Homebuilding and Lennar Multifamily
businesses; a slowdown in the real estate markets across the
nation, including a slowdown in the multifamily rental market;
unfavorable or unanticipated losses in legal proceedings that
substantially exceed our expectations; decreased demand for our
homes or Lennar Multifamily rental properties, and our inability to
successfully sell our apartments; natural disasters or catastrophic
events for which our insurance may not provide adequate coverage; a
decline in the value of the land and home inventories we maintain
or possible future write-downs of the carrying value of our real
estate assets; the inability of the Rialto segment to profit from
the investments it makes; reduced availability of mortgage
financing and increased interest rates; changes in laws,
regulations or the regulatory environment affecting our business,
and the risks described in our filings with the Securities and
Exchange Commission, including our Form 10-K, for the fiscal year
ended November 30, 2014. We undertake
no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events, or
otherwise.
A conference call to discuss the Company's third quarter
earnings will be held at 11:00 a.m. Eastern
Time on Monday, September 21,
2015. The call will be broadcast live on the Internet and
can be accessed through the Company's website at www.lennar.com. If
you are unable to participate in the conference call, the call will
be archived at www.lennar.com for 90 days. A replay of the
conference call will also be available later that day by calling
203-369-1809 and entering 5723593 as the confirmation number.
LENNAR CORPORATION
AND SUBSIDIARIES
|
Selected Revenues and
Operating Information
|
(In thousands, except
per share amounts)
|
(unaudited)
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
August
31,
|
|
August
31,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Revenues:
|
|
|
|
|
|
|
|
Lennar
Homebuilding
|
$
|
2,232,318
|
|
1,830,771
|
|
5,789,788
|
|
4,696,941
|
Lennar Financial
Services
|
168,748
|
|
128,379
|
|
463,460
|
|
316,347
|
Rialto
|
51,554
|
|
40,848
|
|
160,682
|
|
142,196
|
Lennar
Multifamily
|
39,078
|
|
14,036
|
|
114,511
|
|
40,390
|
Total
revenues
|
$
|
2,491,698
|
|
2,014,034
|
|
6,528,441
|
|
5,195,874
|
|
|
|
|
|
|
|
|
Lennar Homebuilding
operating earnings
|
$
|
333,712
|
|
261,928
|
|
834,145
|
|
658,657
|
Lennar Financial
Services operating earnings
|
39,437
|
|
27,144
|
|
94,017
|
|
49,902
|
Rialto operating
earnings
|
6,993
|
|
7,835
|
|
16,682
|
|
7,662
|
Lennar Multifamily
operating earnings (loss)
|
(2,990)
|
|
8,500
|
|
(17,378)
|
|
(4,879)
|
Corporate general and
administrative expenses
|
(56,494)
|
|
(43,072)
|
|
(150,355)
|
|
(119,501)
|
Earnings before
income taxes
|
320,658
|
|
262,335
|
|
777,111
|
|
591,841
|
Provision for income
taxes
|
(95,621)
|
|
(88,895)
|
|
(250,573)
|
|
(215,819)
|
Net earnings
(including net earnings (loss)
attributable to noncontrolling interests)
|
225,037
|
|
173,440
|
|
526,538
|
|
376,022
|
Less: Net earnings
(loss) attributable to
noncontrolling interests
|
1,725
|
|
(4,317)
|
|
5,247
|
|
(17,571)
|
Net earnings
attributable to Lennar
|
$
|
223,312
|
|
177,757
|
|
521,291
|
|
393,593
|
|
|
|
|
|
|
|
|
Average shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
206,439
|
|
202,354
|
|
204,120
|
|
202,103
|
Diluted
|
230,548
|
|
228,228
|
|
230,635
|
|
227,957
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
Basic
|
$
|
1.07
|
|
0.87
|
|
2.53
|
|
1.92
|
Diluted
(1)
|
$
|
0.96
|
|
0.78
|
|
2.25
|
|
1.73
|
|
|
|
|
|
|
|
|
Supplemental
information:
|
|
|
|
|
|
|
|
Interest incurred
(2)
|
$
|
70,746
|
|
70,806
|
|
217,237
|
|
206,406
|
|
|
|
|
|
|
|
|
EBIT
(3):
|
|
|
|
|
|
|
|
Net earnings
attributable to Lennar
|
$
|
223,312
|
|
177,757
|
|
521,291
|
|
393,593
|
Provision for income
taxes
|
95,621
|
|
88,895
|
|
250,573
|
|
215,819
|
Interest
expense
|
58,922
|
|
51,381
|
|
154,631
|
|
141,565
|
EBIT
|
$
|
377,855
|
|
318,033
|
|
926,495
|
|
750,977
|
|
|
|
|
|
|
|
|
|
(1)
|
Diluted earnings per
share includes an add back of interest of $2.0 million and $5.9
million for both the three and nine months
ended August 31, 2015 and 2014, respectively, related to the
Company's 3.25% convertible senior notes.
|
(2)
|
Amount represents
interest incurred related to Lennar Homebuilding debt.
|
(3)
|
EBIT is a non-GAAP
financial measure defined as earnings before interest and taxes.
This financial measure has been presented
because the Company finds it important and useful in evaluating its
performance and believes that it helps readers of the Company's
financial statements compare its operations with those of its
competitors. Although management finds EBIT to be an important
measure in conducting and evaluating the Company's operations, this
measure has limitations as an analytical tool as it is not
reflective of the actual profitability generated by the Company
during the period. Management compensates for the limitations
of
using EBIT by using this non-GAAP measure only to supplement the
Company's GAAP results. Due to the limitations discussed,
EBIT should not be viewed in isolation, as it is not a substitute
for GAAP measures.
|
LENNAR CORPORATION
AND SUBSIDIARIES
|
Segment
Information
|
(In
thousands)
|
(unaudited)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
August
31,
|
|
August
31,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Lennar
Homebuilding revenues:
|
|
|
|
|
|
|
|
Sales of
homes
|
$
|
2,209,010
|
|
1,811,422
|
|
5,693,691
|
|
4,557,019
|
Sales of
land
|
23,308
|
|
19,349
|
|
96,097
|
|
139,922
|
Total
revenues
|
2,232,318
|
|
1,830,771
|
|
5,789,788
|
|
4,696,941
|
|
|
|
|
|
|
|
|
Lennar
Homebuilding costs and expenses:
|
|
|
|
|
|
|
|
Cost of homes
sold
|
1,677,648
|
|
1,355,260
|
|
4,341,703
|
|
3,405,189
|
Cost of land
sold
|
16,636
|
|
15,011
|
|
73,865
|
|
113,869
|
Selling, general and
administrative
|
218,999
|
|
188,048
|
|
588,372
|
|
496,259
|
Total costs and
expenses
|
1,913,283
|
|
1,558,319
|
|
5,003,940
|
|
4,015,317
|
Lennar
Homebuilding operating margins
|
319,035
|
|
272,452
|
|
785,848
|
|
681,624
|
Lennar Homebuilding
equity in earnings (loss) from
unconsolidated entities
|
13,300
|
|
(2,080)
|
|
48,693
|
|
3,304
|
Lennar Homebuilding
other income (expense), net
|
4,189
|
|
(63)
|
|
10,305
|
|
5,088
|
Other interest
expense
|
(2,812)
|
|
(8,381)
|
|
(10,701)
|
|
(31,359)
|
Lennar
Homebuilding operating earnings
|
$
|
333,712
|
|
261,928
|
|
834,145
|
|
658,657
|
|
|
|
|
|
|
|
|
Lennar Financial
Services revenues
|
$
|
168,748
|
|
128,379
|
|
463,460
|
|
316,347
|
Lennar Financial
Services costs and expenses
|
129,311
|
|
101,235
|
|
369,443
|
|
266,445
|
Lennar Financial
Services operating earnings
|
$
|
39,437
|
|
27,144
|
|
94,017
|
|
49,902
|
|
|
|
|
|
|
|
|
Rialto
revenues
|
$
|
51,554
|
|
40,848
|
|
160,682
|
|
142,196
|
Rialto costs and
expenses
|
53,323
|
|
47,644
|
|
161,610
|
|
174,824
|
Rialto equity in
earnings from unconsolidated entities
|
7,590
|
|
19,973
|
|
17,582
|
|
43,266
|
Rialto other income
(expense), net
|
1,172
|
|
(5,342)
|
|
28
|
|
(2,976)
|
Rialto operating
earnings
|
$
|
6,993
|
|
7,835
|
|
16,682
|
|
7,662
|
|
|
|
|
|
|
|
Lennar Multifamily
revenues
|
$
|
39,078
|
|
14,036
|
|
114,511
|
|
40,390
|
Lennar Multifamily
costs and expenses
|
47,072
|
|
20,482
|
|
136,293
|
|
59,958
|
Lennar Multifamily
equity in earnings from
unconsolidated entities
|
5,004
|
|
14,946
|
|
4,404
|
|
14,689
|
Lennar Multifamily
operating earnings (loss)
|
$
|
(2,990)
|
|
8,500
|
|
(17,378)
|
|
(4,879)
|
LENNAR CORPORATION
AND SUBSIDIARIES
|
Summary of Deliveries
and New Orders
|
(Dollars in
thousands, except average sales price)
|
(unaudited)
|
|
|
For the Three
Months Ended August 31,
|
Deliveries:
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
2,401
|
|
|
1,962
|
|
|
$
|
730,961
|
|
|
567,359
|
|
|
$
|
304,000
|
|
|
289,000
|
Central
|
987
|
|
|
899
|
|
|
316,924
|
|
|
265,310
|
|
|
321,000
|
|
|
295,000
|
West
|
1,411
|
|
|
1,050
|
|
|
638,168
|
|
|
451,748
|
|
|
452,000
|
|
|
430,000
|
Southeast
Florida
|
482
|
|
|
499
|
|
|
175,933
|
|
|
161,755
|
|
|
365,000
|
|
|
324,000
|
Houston
|
685
|
|
|
676
|
|
|
196,471
|
|
|
181,273
|
|
|
287,000
|
|
|
268,000
|
Other
|
352
|
|
|
371
|
|
|
151,971
|
|
|
188,586
|
|
|
432,000
|
|
|
508,000
|
Total
|
6,318
|
|
|
5,457
|
|
|
$
|
2,210,428
|
|
|
1,816,031
|
|
|
$
|
350,000
|
|
|
333,000
|
|
Of the total homes
delivered listed above, 4 homes with a dollar value of $1.4 million
and an average sales price of $354,000 represent home deliveries
from unconsolidated entities for the three months ended August 31,
2015, compared to 7 home deliveries with a dollar value of $4.6
million and an average sales price of $658,000 for the three months
ended August 31, 2014.
|
|
New
Orders:
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
2,463
|
|
|
2,090
|
|
|
$
|
730,795
|
|
|
598,856
|
|
|
$
|
297,000
|
|
|
287,000
|
Central
|
1,029
|
|
|
936
|
|
|
350,012
|
|
|
276,976
|
|
|
340,000
|
|
|
296,000
|
West
|
1,411
|
|
|
1,250
|
|
|
683,352
|
|
|
542,575
|
|
|
484,000
|
|
|
434,000
|
Southeast
Florida
|
607
|
|
|
591
|
|
|
208,207
|
|
|
206,287
|
|
|
343,000
|
|
|
349,000
|
Houston
|
606
|
|
|
689
|
|
|
184,075
|
|
|
183,932
|
|
|
304,000
|
|
|
267,000
|
Other
|
379
|
|
|
333
|
|
|
180,875
|
|
|
133,844
|
|
|
477,000
|
|
|
402,000
|
Total
|
6,495
|
|
|
5,889
|
|
|
$
|
2,337,316
|
|
|
1,942,470
|
|
|
$
|
360,000
|
|
|
330,000
|
|
|
Of the total new
orders listed above, 29 homes with a dollar value of $18.0 million
and an average sales price of $621,000 represent new orders from
unconsolidated entities for the three months ended August 31, 2015,
compared to 39 new orders with a dollar value of $23.9 million and
an average sales price of $614,000 for the three months ended
August 31, 2014.
|
|
|
For the Nine
Months Ended August 31,
|
Deliveries:
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
6,198
|
|
|
5,215
|
|
|
$
|
1,836,088
|
|
|
1,493,323
|
|
|
$
|
296,000
|
|
|
286,000
|
Central
|
2,619
|
|
|
2,252
|
|
|
823,003
|
|
|
638,563
|
|
|
314,000
|
|
|
284,000
|
West
|
3,690
|
|
|
2,767
|
|
|
1,644,870
|
|
|
1,175,175
|
|
|
446,000
|
|
|
425,000
|
Southeast
Florida
|
1,379
|
|
|
1,171
|
|
|
491,270
|
|
|
392,830
|
|
|
356,000
|
|
|
335,000
|
Houston
|
1,782
|
|
|
1,714
|
|
|
504,034
|
|
|
469,544
|
|
|
283,000
|
|
|
274,000
|
Other
|
967
|
|
|
934
|
|
|
413,552
|
|
|
406,016
|
|
|
428,000
|
|
|
435,000
|
Total
|
16,635
|
|
|
14,053
|
|
|
$
|
5,712,817
|
|
|
4,575,451
|
|
|
$
|
343,000
|
|
|
326,000
|
|
Of the total homes
delivered listed above, 31 homes with a dollar value of $19.1
million and an average sales price of $617,000 represent home
deliveries from unconsolidated entities for the nine months ended
August 31, 2015, compared to 30 home deliveries with a dollar value
of $18.4 million and an average sales price of $614,000 for the
nine months ended August 31, 2014
|
|
New
Orders:
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
7,032
|
|
|
5,918
|
|
|
$
|
2,110,238
|
|
|
1,698,884
|
|
|
$
|
300,000
|
|
|
287,000
|
|
Central
|
3,158
|
|
|
2,747
|
|
|
1,035,381
|
|
|
800,172
|
|
|
328,000
|
|
|
291,000
|
|
West
|
4,357
|
|
|
3,396
|
|
|
2,029,917
|
|
|
1,479,886
|
|
|
466,000
|
|
|
436,000
|
|
Southeast
Florida
|
1,547
|
|
|
1,480
|
|
|
537,615
|
|
|
495,391
|
|
|
348,000
|
|
|
335,000
|
|
Houston
|
1,810
|
|
|
2,002
|
|
|
533,184
|
|
|
546,838
|
|
|
295,000
|
|
|
273,000
|
|
Other
|
1,149
|
|
|
994
|
|
|
509,196
|
|
|
406,252
|
|
|
443,000
|
|
|
409,000
|
|
Total
|
19,053
|
|
|
16,537
|
|
|
$
|
6,755,531
|
|
|
5,427,423
|
|
|
$
|
355,000
|
|
|
328,000
|
|
Of the total new
orders listed above, 79 homes with a dollar value of $48.0 million
and an average sales price of $608,000 represent new orders from
unconsolidated entities for the nine months ended August 31, 2015,
compared to 63 new orders with a dollar value of $38.9 million and
an average sales price of $618,000 for the nine months ended August
31, 2014.
|
|
LENNAR CORPORATION
AND SUBSIDIARIES
|
Summary of
Backlog
|
(Dollars in
thousands, except average sales price)
|
(unaudited)
|
|
|
August
31,
|
Backlog:
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
3,046
|
|
2,671
|
|
$
|
944,658
|
|
808,348
|
|
$
|
310,000
|
|
303,000
|
Central
|
1,500
|
|
1,139
|
|
523,098
|
|
358,771
|
|
349,000
|
|
315,000
|
West
|
1,658
|
|
1,245
|
|
822,611
|
|
562,474
|
|
496,000
|
|
452,000
|
Southeast
Florida
|
744
|
|
916
|
|
261,021
|
|
318,641
|
|
351,000
|
|
348,000
|
Houston
|
858
|
|
957
|
|
255,016
|
|
258,577
|
|
297,000
|
|
270,000
|
Other
|
444
|
|
362
|
|
209,285
|
|
169,861
|
|
471,000
|
|
469,000
|
Total
|
8,250
|
|
7,290
|
|
$
|
3,015,689
|
|
2,476,672
|
|
$
|
366,000
|
|
340,000
|
|
Of the total homes in
backlog listed above, 115 homes with a backlog dollar value of
$68.7 million and an average sales price of $598,000 represent the
backlog from unconsolidated entities at August 31, 2015,
compared to 37 homes with a backlog dollar value of $23.0 million
and an average sales price of $622,000 at August 31,
2014.
|
Lennar's reportable homebuilding segments and all other
homebuilding operations not required to be reported separately,
have operations located in:
East: Florida(1), Georgia, Maryland, New
Jersey, North Carolina,
South Carolina and Virginia
Central: Arizona,
Colorado and Texas(2)
West:
California and Nevada
Southeast Florida:
Southeast Florida
Houston: Houston, Texas
Other: Illinois,
Minnesota, Oregon, Tennessee and Washington
(1) Florida in the East reportable segment excludes
Southeast Florida, which is its
own reportable segment.
(2) Texas in the Central
reportable segment excludes Houston,
Texas, which is its own reportable segment.
LENNAR CORPORATION
AND SUBSIDIARIES
|
Supplemental
Data
|
(Dollars in
thousands)
|
(unaudited)
|
|
|
August
31,
|
|
November
30,
|
|
August
31,
|
|
2015
|
|
2014
|
|
2014
|
Lennar Homebuilding
debt
|
$
|
5,261,862
|
|
4,690,213
|
|
4,692,880
|
Stockholders'
equity
|
5,360,016
|
|
4,827,020
|
|
4,581,479
|
Total
capital
|
$
|
10,621,878
|
|
9,517,233
|
|
9,274,359
|
Lennar
Homebuilding debt to total capital
|
49.5%
|
|
49.3%
|
|
50.6%
|
|
|
|
|
|
|
Lennar Homebuilding
debt
|
$
|
5,261,862
|
|
4,690,213
|
|
4,692,880
|
Less: Lennar
Homebuilding cash and cash equivalents
|
595,719
|
|
885,729
|
|
542,241
|
Net Lennar
Homebuilding debt
|
$
|
4,666,143
|
|
3,804,484
|
|
4,150,639
|
Net Lennar
Homebuilding debt to total capital (1)
|
46.5%
|
|
44.1%
|
|
47.5%
|
|
(1)
|
Net Lennar
Homebuilding debt to total capital is a non-GAAP financial measure
defined as net Lennar Homebuilding debt
(Lennar Homebuilding debt less Lennar Homebuilding cash and cash
equivalents) divided by total capital (net Lennar
Homebuilding debt plus stockholders' equity). The Company believes
the ratio of net Lennar Homebuilding debt to total
capital is a relevant and a useful financial measure to investors
in understanding the leverage employed in Lennar
Homebuilding operations. However, because net Lennar Homebuilding
debt to total capital is not calculated in accordance
with GAAP, this financial measure should not be considered in
isolation or as an alternative to financial measures prescribed
by GAAP. Rather, this non-GAAP financial measure should be used to
supplement the Company's GAAP results.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/lennar-reports-third-quarter-eps-of-096-300146006.html
SOURCE Lennar Corporation