MIAMI, Dec. 19, 2016 /PRNewswire/ --
2016 Fourth Quarter
- Net earnings of $313.5
million, or $1.34 per diluted
share, compared to net earnings of $281.6
million, or $1.21 per diluted
share
- Deliveries of 8,228 homes – up 7%
- New orders of 6,598 homes – up 9%; new orders dollar value
of $2.4 billion – up 12%
- Backlog of 7,623 homes – up 15%; backlog dollar value of
$2.9 billion – up 17%
- Revenues of $3.4 billion – up
15%
- Lennar Homebuilding operating earnings of $436.7 million, compared to $437.5 million
- Gross margin on home sales of 23.3%, compared to 24.6% in Q4
2015, improved sequentially 70 basis points from Q3 2016
- S,G&A expenses as a % of revenues from home sales
improved to 8.7% from 9.2% in Q4 2015, improved sequentially 60
basis points from Q3 2016
- Operating margin on home sales of 14.6%, compared to 15.5%
in Q4 2015, improved sequentially 140 basis points from Q3
2016
- Lennar Financial Services operating earnings of $51.4 million, compared to $33.8 million
- Rialto operating earnings (net of noncontrolling interests)
of $8.0 million, compared to
$7.6 million
- Lennar Multifamily operating earnings of $41.4 million, compared to $10.2 million
- Lennar Homebuilding cash and cash equivalents of
$1.1 billion
- No outstanding borrowings under the $1.8 billion credit facility
- Lennar Homebuilding debt to total capital, net of cash and
cash equivalents, of 33.4%, compared to 42.2% in Q4 2015
2016 Fiscal Year
- Net earnings of $911.8
million, or $3.93 per diluted
share, compared to net earnings of $802.9
million, or $3.46 per diluted
share
- Deliveries of 26,563 homes – up 9%
- New orders of 27,372 homes – up 9%
- Revenues of $10.9 billion – up
16%
Lennar Corporation (NYSE: LEN and LEN.B), one
of the nation's largest homebuilders, today reported results
for its fourth quarter and fiscal year ended November 30, 2016. Fourth quarter net earnings
attributable to Lennar in 2016 were $313.5
million, or $1.34 per diluted
share, compared to $281.6 million, or
$1.21 per diluted share, in the
fourth quarter of 2015. Net earnings attributable to Lennar for the
year ended November 30, 2016 were
$911.8 million, or $3.93 per diluted share, compared to $802.9 million, or $3.46 per diluted share, for the year ended
November 30, 2015.
Stuart Miller, Chief Executive
Officer of Lennar Corporation, said, "We delivered another fourth
quarter and fiscal year of strong and consistent results, that
reflect our clearly defined operating strategies. For the
quarter and year we achieved an 11% and 14% year-over-year increase
in net earnings, respectively.
"We have consistently believed that the housing market is
continuing its slow and steady recovery, and we have crafted our
operating strategies specifically to position our company to grow
at a measured pace and to act opportunistically in these market
conditions. With the anticipation of a new President focusing
on accelerating economic growth, we believe that our fortified
balance sheet, our diversified business model and our refined
product offerings, will continue to hold us in good stead in a
high-growth economy, despite the potential of moderately rising
interest rates over the next several years."
Mr. Miller continued, "Our core homebuilding business continued
to produce strong operating results in the fourth quarter as our
home deliveries and new orders increased 7% and 9%, respectively,
compared to last year, while our gross and operating margins were
23.3% and 14.6%, respectively. We continued to invest in new
technologies and in the re-piping of our systems to maximize
efficiencies which helped contribute to an S,G&A % of home sale
revenues of 8.7% in the fourth quarter.
"Disciplined adherence to our operating strategy drove net
homebuilding debt to total capital to 33.4% at year-end, an
improvement of 880 basis points over last year, which marks the
return of our balance sheet to pre-downturn levels. This was
accomplished through our soft pivot strategy and strong bottom-line
profits that led to positive operating cash flows in 2016, as well
as the conversion of our convertible debt that reduced our leverage
without impacting diluted earnings per share.
"Complementing our homebuilding business, our Lennar Financial
Services segment continued its strong performance by increasing its
earnings to $51.4 million in the
fourth quarter from $33.8 million in
2015. The increase in profitability was primarily due to an
increase in transactions and a higher profit per transaction.
"Our Multifamily business generated $41.4
million of earnings during the fourth quarter, primarily due
to the sale of four apartment properties by its joint ventures.
With the maturation of this segment, combined with our
geographically diversified pipeline, we expect this business to
continue to produce another year of strong results in fiscal
2017."
Mr. Miller concluded, "While our homebuilding and financial
services businesses continue to be the primary driver of our
earnings, we are in an excellent position across our multiple
platforms. With our strong balance sheet and a sales backlog dollar
value of $2.9 billion, we are well
positioned as we enter 2017."
RESULTS OF OPERATIONS
THREE MONTHS ENDED NOVEMBER 30, 2016 COMPARED TO
THREE
MONTHS ENDED NOVEMBER 30,
2015
Lennar Homebuilding
Revenues from home sales increased 11% in the fourth quarter of
2016 to $2.9 billion from
$2.6 billion in the fourth quarter of
2015. Revenues were higher primarily due to an 8% increase in the
number of home deliveries, excluding unconsolidated entities, and a
3% increase in the average sales price of homes delivered. New home
deliveries, excluding unconsolidated entities, increased to 8,206
homes in the fourth quarter of 2016 from 7,605 homes in the fourth
quarter of 2015. There was an increase in home deliveries in all of
the Company's Homebuilding segments and Homebuilding Other. This
includes an increase in home deliveries in Homebuilding Central
despite a slight decrease in home deliveries in Homebuilding
Houston, which is now aggregated into the Company's Homebuilding
Central segment as it no longer meets the reportable segment
criteria. The average sales price of homes delivered increased to
$357,000 in the fourth quarter of
2016 from $347,000 in the fourth
quarter of 2015. Sales incentives offered to homebuyers were
$23,700 per home delivered in the
fourth quarter of 2016, or 6.2% as a percentage of home sales
revenue, compared to $21,700 per home
delivered in the same period last year, or 5.9% as a percentage of
home sales revenue.
Gross margins on home sales were $683.5
million, or 23.3%, in the fourth quarter of 2016, compared
to $651.1 million, or 24.6%, in the
fourth quarter of 2015. Gross margin percentage on home sales
decreased compared to the fourth quarter of 2015 primarily due to
an increase in land and construction costs per home, partially
offset by an increase in the average sales price of homes
delivered.
Selling, general and administrative expenses were $256.2 million in the fourth quarter of 2016,
compared to $242.7 million in the
fourth quarter of 2015. As a percentage of revenues from home
sales, selling, general and administrative expenses improved to
8.7% in the fourth quarter of 2016, from 9.2% in the fourth quarter
of 2015, due to improved operating leverage as a result of an
increase in home deliveries and benefits from the Company's focus
on digital marketing.
Gross profits on land sales were $24.3
million in the fourth quarter of 2016, which included three
significant land transactions that generated $16.1 million in gross profits, compared to
$7.9 million of gross profits on land
sales in the fourth quarter of 2015.
Lennar Homebuilding equity in earnings (loss) from
unconsolidated entities was ($24.6)
million in the fourth quarter of 2016, compared to
$14.7 million in the fourth quarter
of 2015. In the fourth quarter of 2016, Lennar Homebuilding equity
in loss from unconsolidated entities was primarily attributable to
the Company's share of net operating losses associated with the new
FivePoint unconsolidated entity formed as the result of the
FivePoint combination in the second quarter of fiscal 2016. In the
fourth quarter of 2015, Lennar Homebuilding equity in earnings from
unconsolidated entities included $18.3
million of equity in earnings from one of the Company's
unconsolidated entities primarily due to sales of homesites to
another joint venture in which the Company has a 50%
investment.
Lennar Homebuilding other income, net, was $11.0 million in the fourth quarter of 2016,
compared to $8.3 million in the
fourth quarter of 2015.
Lennar Homebuilding interest expense was $73.3 million in the fourth quarter of 2016
($69.4 million was included in costs
of homes sold, $2.6 million in costs
of land sold and $1.3 million in
other interest expense), compared to $65.5
million in the fourth quarter of 2015 ($62.9 million was included in costs of homes
sold, $0.8 million in costs of land
sold and $1.8 million in other
interest expense). Interest expense included in costs of homes sold
increased primarily due to an increase in home deliveries.
Lennar Financial Services
Operating earnings for the Lennar Financial Services segment
were $51.4 million in the fourth
quarter of 2016, compared to $33.8
million in the fourth quarter of 2015. The increase in
profitability was primarily due to increased transactions and
higher profit per transaction in the segment's mortgage and title
operations.
Rialto
Operating earnings for the Rialto segment were $8.0 million in the fourth quarter of 2016 (which
included a $0.2 million operating
loss and an add back of $8.2 million
of net loss attributable to noncontrolling interests). Operating
earnings in the fourth quarter of 2015 were $7.6 million (which included $16.9 million of operating earnings, partially
offset by $9.3 million of net
earnings attributable to noncontrolling interests).
Revenues in this segment were $81.5
million in the fourth quarter of 2016, compared to
$61.2 million in the fourth quarter
of 2015. Revenues increased primarily due to an increase in Rialto
Mortgage Finance ("RMF") securitization revenues due to higher
securitization margins.
Expenses in this segment were $74.4
million in the fourth quarter of 2016, compared to
$61.3 million in the fourth quarter
of 2015. Expenses increased primarily due to an increase in general
and administrative expenses.
Rialto equity in earnings from unconsolidated entities was
$4.6 million and $4.7 million in the fourth quarter of 2016 and
2015, respectively, related to Rialto's share of earnings from its
real estate funds (the "Funds").
Rialto other income (expense), net, was ($12.0) million in the fourth quarter of 2016,
compared to $12.2 million in the
fourth quarter of 2015. The decrease in other income (expense),
net, was primarily attributable to a decrease in net realized gains
on the sale of real estate owned ("REO") and an increase in REO
impairments.
Lennar Multifamily
Operating earnings for the Lennar Multifamily segment were
$41.4 million in the fourth quarter
of 2016, compared to $10.2 million in
the fourth quarter of 2015. The increase in profitability was
primarily due to the segment's $47.2
million share of gains related to the sale of four operating
properties by Lennar Multifamily's unconsolidated entities in the
fourth quarter of 2016, compared to the segment's $16.6 million share of a gain as a result of the
sale of one operating property by one of its unconsolidated
entities in the fourth quarter of 2015.
Corporate General and Administrative Expenses
Corporate general and administrative expenses were $67.9 million, or 2.0% as a percentage of total
revenues, in the fourth quarter of 2016, compared to $65.9 million, or 2.2% as a percentage of total
revenues, in the fourth quarter of 2015. As a percentage of total
revenues, corporate general and administrative expenses improved
due to increased operating leverage.
Noncontrolling Interests
Net earnings (loss) attributable to noncontrolling interests
were ($3.0) million and $11.1 million in the fourth quarter of 2016 and
2015, respectively. Net loss attributable to noncontrolling
interests during the fourth quarter of 2016 was primarily
attributable to 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, partially offset by net earnings related
to the Lennar Homebuilding consolidated joint ventures. Net
earnings attributable to noncontrolling interests in the fourth
quarter of 2015 were primarily attributable to earnings related to
the FDIC's interest in the portfolio of real estate loans that the
Company acquired in partnership with the FDIC.
YEAR ENDED NOVEMBER 30,
2016 COMPARED TO
YEAR ENDED NOVEMBER 30, 2015
Lennar Homebuilding
Revenues from home sales increased 15% in the year ended
November 30, 2016 to $9.6 billion from $8.3
billion in the year ended November
30, 2015. Revenues were higher primarily due to a 9%
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 26,481 homes in the year ended November 30, 2016 from 24,209 homes in the year
ended November 30, 2015. There was an
increase in home deliveries in all of the Company's Homebuilding
segments and Homebuilding Other. This includes an increase in home
deliveries in Homebuilding Central despite a slight decrease in
home deliveries in Homebuilding Houston, which is now aggregated
into the Company's Homebuilding Central segment as it no longer
meets the reportable segment criteria. The average sales price of
homes delivered increased to $361,000
in the year ended November 30, 2016
from $344,000 in the year ended
November 30, 2015. Sales incentives
offered to homebuyers were $22,500
per home delivered in the year ended November 30, 2016, or 5.9% as a percentage of
home sales revenue, compared to $21,400 per home delivered in the year ended
November 30, 2015, or 5.9% as a
percentage of home sales revenue.
Gross margins on home sales were $2.2
billion, or 23.0%, in the year ended November 30, 2016, compared to $2.0 billion, or 24.0%, in the year ended
November 30, 2015. Gross margin
percentage on home sales decreased compared to the year ended
November 30, 2015 primarily due to an
increase in land costs per home, partially offset by an increase in
the average sales price of homes delivered.
Selling, general and administrative expenses were $898.9 million in the year ended November 30, 2016, compared to $831.1 million in the year ended November 30, 2015. As a percentage of revenues
from home sales, selling, general and administrative expenses
improved to 9.4% in the year ended November
30, 2016, from 10.0% in the year ended November 30, 2015, due to improved operating
leverage as a result of an increase in home deliveries and benefits
from the Company's focus on digital marketing.
Gross profits on land sales were $44.7
million in the year ended November 30, 2016, compared
to $30.1 million in the year ended
November 30, 2015.
Lennar Homebuilding equity in earnings (loss) from
unconsolidated entities was ($49.3)
million in the year ended November
30, 2016, compared to $63.4
million in the year ended November
30, 2015. In the year ended November
30, 2016, Lennar Homebuilding equity in loss from
unconsolidated entities was primarily attributable to the Company's
share of costs associated with the FivePoint combination as well as
the Company's share of net operating losses associated with the new
FivePoint unconsolidated entity formed as the result of this
combination. This was partially offset by $12.7 million of equity in earnings from one of
the Company's unconsolidated entities primarily due to sales of
homesites to third parties. In the year ended November 30,
2015, Lennar Homebuilding equity in earnings from unconsolidated
entities included $82.8 million of
equity in earnings from one of the Company's unconsolidated
entities primarily due to sales of homesites and a commercial
property to third parties, sales of homesites to another joint
venture in which the Company has a 50% investment, and a gain on
debt extinguishment.
Lennar Homebuilding other income, net, totaled $57.4 million in the year ended November 30, 2016, compared to $18.6 million in the year ended November 30, 2015. In the year ended November 30, 2016, other income, net, included
management fee income and a profit participation related to Lennar
Homebuilding's strategic joint ventures and gains on the sale of
several clubhouses during the year ended November 30, 2016. In the year ended
November 30, 2015, other income, net, included $10.2 million aggregate gains on sales of an
operating property and a clubhouse.
Lennar Homebuilding interest expense was $245.1 million in the year ended November 30, 2016 ($235.1
million was included in costs of homes sold, $5.3 million in costs of land sold and
$4.6 million in other interest
expense), compared to $220.1 million
in the year ended November 30, 2015
($205.2 million was included in costs
of homes sold, $2.5 million in costs
of land sold and $12.5 million in
other interest expense). Interest expense included in costs of
homes sold increased primarily due to an increase in home
deliveries.
Lennar Financial Services
Operating earnings for the Lennar Financial Services segment
were $163.6 million in the year ended
November 30, 2016, compared to
$127.8 million in the year ended
November 30, 2015. The increase in
profitability was primarily due to increased transactions and
higher profit per transaction in the segment's mortgage and title
operations.
Rialto
Operating earnings for the Rialto segment were $2.1 million in the year ended November 30, 2016 (which included a $16.7 million operating loss and an add back of
$18.8 million of net loss
attributable to noncontrolling interests). Operating earnings in
the year ended November 30, 2015 were
$28.8 million (which included
$33.6 million of operating earnings,
partially offset by $4.8 million of
net earnings attributable to noncontrolling interests).
Revenues in this segment were $234.0
million in the year ended November
30, 2016, compared to $221.9
million in the year ended November
30, 2015. Revenues increased primarily due to an increase in
RMF securitization revenues due to higher securitization
margins.
Expenses in this segment were $229.8
million in the year ended November
30, 2016, compared to $222.9
million in the year ended November
30, 2015. Expenses increased primarily due to an increase in
loan impairments and general and administrative expenses.
Rialto equity in earnings from unconsolidated entities was
$19.0 million and $22.3 million in the years ended
November 30, 2016 and 2015, respectively, related to Rialto's
share of earnings from the Funds.
Rialto other income (expense), net, was ($39.9) million in the year ended November 30, 2016, compared to $12.3 million in the year ended November 30, 2015. The decrease in other income
(expense), net, was primarily attributable to a $16.0 million write-off of uncollectible
receivables related to a hospital, which was acquired through the
resolution of one of Rialto's loans from a 2010 portfolio, a
decrease in net realized gains on the sale of REO, and an increase
in REO impairments. The hospital is managed by a third-party
management company.
Lennar Multifamily
Operating earnings for the Lennar Multifamily segment were
$71.2 million in the year ended
November 30, 2016, compared to an
operating loss of $7.2 million in the
year ended November 30, 2015. The
increase in profitability was primarily due to the segment's
$91.0 million share of gains as a
result of the sale of seven operating properties by Lennar
Multifamily's unconsolidated entities. In the year ended
November 30, 2015, the operating loss in Lennar Multifamily
primarily related to general and administrative expenses, partially
offset by the segment's $22.2 million
share of gains as a result of the sale of two operating properties
by Lennar Multifamily's unconsolidated entities, management fee
income and general contractor income, net.
Corporate General and Administrative Expenses
Corporate general and administrative expenses were $232.6 million, or 2.1% as a percentage of total
revenues, in the year ended November 30,
2016, compared to $216.2
million, or 2.3% as a percentage of total revenues, in the
year ended November 30, 2015. As a
percentage of total revenues, corporate general and administrative
expenses improved due to increased operating leverage.
Noncontrolling Interests
Net earnings attributable to noncontrolling interests were
$1.2 million and $16.3 million in the years ended
November 30, 2016 and 2015, respectively. Net earnings
attributable to noncontrolling interests during the year ended
November 30, 2016 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 earnings
attributable to noncontrolling interests during the year ended
November 30, 2015 were primarily
attributable to earnings related to Lennar Homebuilding
consolidated joint ventures and net earnings related to the FDIC's
interest in the portfolio of real estate loans that the Company
acquired in partnership with the FDIC.
OTHER TRANSACTIONS
Debt Transactions
During the year ended November 30,
2016, holders converted or redeemed the aggregate principal
amount of $400 million of the
Company's 3.25% convertible senior notes due 2021 for 17.0 million
shares of Class A common stock and small cash premiums.
During the year ended November 30,
2016, holders converted or redeemed the remaining aggregate
principal amount of $234 million of
the Company's 2.75% convertible senior notes due 2020 for
approximately $234 million in cash
and 5.2 million shares of Class A common stock.
In March 2016, the Company issued
$500 million of 4.750% senior notes
due 2021. The Company used the net proceeds from the sales of the
4.750% senior notes due 2021 to retire its 6.50% senior notes due
April 2016 for 100% of the
outstanding principal amount, plus accrued and unpaid interest.
Credit Facility
In June 2016, the Company amended
the credit agreement governing its unsecured revolving credit
facility (the "Credit Facility") to increase the maximum borrowings
from $1.6 billion to $1.8 billion, including a $298 million accordion feature, subject to
additional commitments, with certain financial institutions. The
maturity for $1.3 billion of the
Credit Facility was extended to June
2020, with the remaining $160
million maturing in June
2018.
Business Acquisition
On September 22, 2016, the Company
entered into an Agreement and Plan of Merger (the "Merger
Agreement") with WCI Communities, Inc. ("WCI"), under which the
Company will acquire WCI through a merger for a combination of the
Company's Class A common stock and cash. However, the Company has
the right to reduce the portion of the merger consideration that
will be Class A common stock and increase the portion that will be
cash, including the right to make the entire merger consideration
cash. The transaction is subject to approval by WCI's stockholders.
It is anticipated that a meeting of WCI stockholders to vote on the
transaction will be held in January
2017, and, if the transaction is approved by the WCI
stockholders, it will close promptly after the stockholder
vote.
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 regarding
the homebuilding market and other markets in which we participate,
and our belief regarding how we are positioned to take advantage of
opportunities, or to avoid problems, in those markets and to
advance the future growth of our businesses. 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 anticipated by 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 market for
single family homes or the multifamily rental market; unfavorable
losses in legal proceedings; 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;
our ability to successfully execute our strategies; 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;
with respect to the WCI transaction, that WCI transaction is not
consummated; the inability of the Rialto segment to profit from the
investments it makes; the inability of Rialto to sell mortgages it
originates into securitizations on favorable terms; reduced
availability of mortgage financing or increased interest rates;
conditions in the capital, credit and financial markets; 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, 2015.
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 fourth quarter
earnings will be held at 11:00 a.m. Eastern
Time on Monday, December 19, 2016. 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 203-369-3973 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
|
|
Years
Ended
|
|
November
30,
|
|
November
30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Revenues:
|
|
|
|
|
|
|
|
Lennar
Homebuilding
|
$
|
3,007,002
|
|
|
2,677,157
|
|
|
9,741,337
|
|
|
8,466,945
|
|
Lennar Financial
Services
|
195,915
|
|
|
157,067
|
|
|
687,255
|
|
|
620,527
|
|
Rialto
|
81,532
|
|
|
61,241
|
|
|
233,966
|
|
|
221,923
|
|
Lennar
Multifamily
|
92,177
|
|
|
50,102
|
|
|
287,441
|
|
|
164,613
|
|
Total
revenues
|
$
|
3,376,626
|
|
|
2,945,567
|
|
|
10,949,999
|
|
|
9,474,008
|
|
|
|
|
|
|
|
|
|
Lennar Homebuilding
operating earnings
|
$
|
436,716
|
|
|
437,496
|
|
|
1,344,932
|
|
|
1,271,641
|
|
Lennar Financial
Services operating earnings
|
51,350
|
|
|
33,778
|
|
|
163,617
|
|
|
127,795
|
|
Rialto operating
earnings (loss)
|
(159)
|
|
|
16,913
|
|
|
(16,692)
|
|
|
33,595
|
|
Lennar Multifamily
operating earnings (loss)
|
41,400
|
|
|
10,207
|
|
|
71,174
|
|
|
(7,171)
|
|
Corporate general and
administrative expenses
|
(67,928)
|
|
|
(65,889)
|
|
|
(232,562)
|
|
|
(216,244)
|
|
Earnings before
income taxes
|
461,379
|
|
|
432,505
|
|
|
1,330,469
|
|
|
1,209,616
|
|
Provision for income
taxes
|
(150,909)
|
|
|
(139,843)
|
|
|
(417,378)
|
|
|
(390,416)
|
|
Net earnings
(including net earnings (loss) attributable to noncontrolling
interests)
|
310,470
|
|
|
292,662
|
|
|
913,091
|
|
|
819,200
|
|
Less: Net earnings
(loss) attributable to noncontrolling interests
|
(2,983)
|
|
|
11,059
|
|
|
1,247
|
|
|
16,306
|
|
Net earnings
attributable to Lennar
|
$
|
313,453
|
|
|
281,603
|
|
|
911,844
|
|
|
802,894
|
|
|
|
|
|
|
|
|
|
Average shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
226,240
|
|
|
208,397
|
|
|
218,421
|
|
|
205,189
|
|
Diluted
|
232,199
|
|
|
231,341
|
|
|
230,712
|
|
|
230,812
|
|
|
|
|
|
|
|
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
Basic
|
$
|
1.37
|
|
|
1.34
|
|
|
4.13
|
|
|
3.87
|
|
Diluted
(1)
|
$
|
1.34
|
|
|
1.21
|
|
|
3.93
|
|
|
3.46
|
|
|
|
|
|
|
|
|
|
Supplemental
information:
|
|
|
|
|
|
|
|
Interest incurred
(2)
|
$
|
67,909
|
|
|
71,279
|
|
|
281,394
|
|
|
288,516
|
|
|
|
|
|
|
|
|
|
EBIT
(3):
|
|
|
|
|
|
|
|
Net earnings
attributable to Lennar
|
$
|
313,453
|
|
|
281,603
|
|
|
911,844
|
|
|
802,894
|
|
Provision for income
taxes
|
150,909
|
|
|
139,843
|
|
|
417,378
|
|
|
390,416
|
|
Interest
expense
|
73,277
|
|
|
65,516
|
|
|
245,061
|
|
|
220,147
|
|
EBIT
|
$
|
537,639
|
|
|
486,962
|
|
|
1,574,283
|
|
|
1,413,457
|
|
|
|
(1)
|
For the three months
and year ended November 30, 2016, diluted earnings per share
includes an add back of interest of $0.7 million and $5.5 million,
respectively, related to the Company's 3.25% convertible senior
notes. For the three months and year ended November 30, 2015,
diluted earnings per share includes an add back of interest of $2.0
million and $7.9 million, 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
|
|
Years
Ended
|
|
November
30,
|
|
November
30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Lennar
Homebuilding revenues:
|
|
|
|
|
|
|
|
Sales of
homes
|
$
|
2,930,921
|
|
|
2,642,213
|
|
|
9,558,517
|
|
|
8,335,904
|
|
Sales of
land
|
76,081
|
|
|
34,944
|
|
|
182,820
|
|
|
131,041
|
|
Total
revenues
|
3,007,002
|
|
|
2,677,157
|
|
|
9,741,337
|
|
|
8,466,945
|
|
|
|
|
|
|
|
|
|
Lennar
Homebuilding costs and expenses:
|
|
|
|
|
|
|
|
Costs of homes
sold
|
2,247,402
|
|
|
1,991,147
|
|
|
7,362,853
|
|
|
6,332,850
|
|
Costs of land
sold
|
51,792
|
|
|
27,074
|
|
|
138,111
|
|
|
100,939
|
|
Selling, general and
administrative
|
256,167
|
|
|
242,678
|
|
|
898,917
|
|
|
831,050
|
|
Total costs and
expenses
|
2,555,361
|
|
|
2,260,899
|
|
|
8,399,881
|
|
|
7,264,839
|
|
Lennar
Homebuilding operating margins
|
451,641
|
|
|
416,258
|
|
|
1,341,456
|
|
|
1,202,106
|
|
Lennar Homebuilding
equity in earnings (loss) from unconsolidated entities
|
(24,608)
|
|
|
14,680
|
|
|
(49,275)
|
|
|
63,373
|
|
Lennar Homebuilding
other income, net
|
10,986
|
|
|
8,311
|
|
|
57,377
|
|
|
18,616
|
|
Other interest
expense
|
(1,303)
|
|
|
(1,753)
|
|
|
(4,626)
|
|
|
(12,454)
|
|
Lennar
Homebuilding operating earnings
|
$
|
436,716
|
|
|
437,496
|
|
|
1,344,932
|
|
|
1,271,641
|
|
|
|
|
|
|
|
|
|
Lennar Financial
Services revenues
|
$
|
195,915
|
|
|
157,067
|
|
|
687,255
|
|
|
620,527
|
|
Lennar Financial
Services costs and expenses
|
144,565
|
|
|
123,289
|
|
|
523,638
|
|
|
492,732
|
|
Lennar Financial
Services operating earnings
|
$
|
51,350
|
|
|
33,778
|
|
|
163,617
|
|
|
127,795
|
|
|
|
|
|
|
|
|
|
Rialto
revenues
|
$
|
81,532
|
|
|
61,241
|
|
|
233,966
|
|
|
221,923
|
|
Rialto costs and
expenses
|
74,353
|
|
|
61,265
|
|
|
229,769
|
|
|
222,875
|
|
Rialto equity in
earnings from unconsolidated entities
|
4,624
|
|
|
4,711
|
|
|
18,961
|
|
|
22,293
|
|
Rialto other income
(expense), net
|
(11,962)
|
|
|
12,226
|
|
|
(39,850)
|
|
|
12,254
|
|
Rialto operating
earnings (loss)
|
$
|
(159)
|
|
|
16,913
|
|
|
(16,692)
|
|
|
33,595
|
|
|
|
|
|
|
|
|
|
Lennar Multifamily
revenues
|
$
|
92,177
|
|
|
50,102
|
|
|
287,441
|
|
|
164,613
|
|
Lennar Multifamily
costs and expenses
|
97,542
|
|
|
55,009
|
|
|
301,786
|
|
|
191,302
|
|
Lennar Multifamily
equity in earnings from unconsolidated entities
|
46,765
|
|
|
15,114
|
|
|
85,519
|
|
|
19,518
|
|
Lennar Multifamily
operating earnings (loss)
|
$
|
41,400
|
|
|
10,207
|
|
|
71,174
|
|
|
(7,171)
|
|
LENNAR CORPORATION
AND SUBSIDIARIES
Summary of Deliveries
and New Orders
(Dollars in
thousands, except average sales price)
(unaudited)
|
|
|
For the Three
Months Ended November 30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Deliveries:
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
4,260
|
|
|
3,938
|
|
|
$
|
1,317,343
|
|
|
1,200,254
|
|
|
$
|
309,000
|
|
|
305,000
|
|
Central
|
1,865
|
|
|
1,770
|
|
|
616,262
|
|
|
561,090
|
|
|
330,000
|
|
|
317,000
|
|
West
|
1,640
|
|
|
1,555
|
|
|
791,905
|
|
|
738,562
|
|
|
483,000
|
|
|
475,000
|
|
Other
|
463
|
|
|
394
|
|
|
221,297
|
|
|
170,883
|
|
|
478,000
|
|
|
434,000
|
|
Total
|
8,228
|
|
|
7,657
|
|
|
$
|
2,946,807
|
|
|
2,670,789
|
|
|
$
|
358,000
|
|
|
349,000
|
|
Of the total homes delivered listed above, 22 homes with a
dollar value of $15.9 million and an
average sales price of $722,000
represent home deliveries from unconsolidated entities for the
three months ended November 30, 2016,
compared to 52 home deliveries with a dollar value of $28.6 million and an average sales price of
$550,000 for the three months ended
November 30, 2015.
New
Orders:
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
3,292
|
|
|
3,000
|
|
|
$
|
1,014,620
|
|
|
922,643
|
|
|
$
|
308,000
|
|
|
308,000
|
|
Central
|
1,557
|
|
|
1,480
|
|
|
530,367
|
|
|
468,774
|
|
|
341,000
|
|
|
317,000
|
|
West
|
1,342
|
|
|
1,251
|
|
|
651,687
|
|
|
587,476
|
|
|
486,000
|
|
|
470,000
|
|
Other
|
407
|
|
|
322
|
|
|
199,759
|
|
|
154,051
|
|
|
491,000
|
|
|
478,000
|
|
Total
|
6,598
|
|
|
6,053
|
|
|
$
|
2,396,433
|
|
|
2,132,944
|
|
|
$
|
363,000
|
|
|
352,000
|
|
The total of new orders listed above is net of 5 cancellations
from unconsolidated entities with a dollar value of $6.5 million and an average sales price of
$1,294,000 for the three months ended
November 30, 2016, compared to new
orders of 26 homes from unconsolidated entities with a dollar value
of $22.2 million and an average sales
price of $855,000 for the three
months ended November 30, 2015.
|
For the Years
Ended November 30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Deliveries:
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
12,483
|
|
|
11,515
|
|
|
$
|
3,890,405
|
|
|
3,527,612
|
|
|
$
|
312,000
|
|
|
306,000
|
|
Central
|
6,788
|
|
|
6,171
|
|
|
2,218,590
|
|
|
1,888,127
|
|
|
327,000
|
|
|
306,000
|
|
West
|
5,734
|
|
|
5,245
|
|
|
2,757,112
|
|
|
2,383,432
|
|
|
481,000
|
|
|
454,000
|
|
Other
|
1,558
|
|
|
1,361
|
|
|
748,040
|
|
|
584,435
|
|
|
480,000
|
|
|
429,000
|
|
Total
|
26,563
|
|
|
24,292
|
|
|
$
|
9,614,147
|
|
|
8,383,606
|
|
|
$
|
362,000
|
|
|
345,000
|
|
Of the total homes delivered listed above, 82 homes with a
dollar value of $55.6 million and an
average sales price of $678,000
represent home deliveries from unconsolidated entities for the year
ended November 30, 2016, compared to
83 home deliveries with a dollar value of $47.7 million and an average sales price of
$575,000 for the year ended
November 30, 2015.
New
Orders:
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East
|
12,764
|
|
|
11,579
|
|
|
$
|
3,977,605
|
|
|
3,570,496
|
|
|
$
|
312,000
|
|
|
308,000
|
|
Central
|
7,041
|
|
|
6,448
|
|
|
2,354,618
|
|
|
2,037,339
|
|
|
334,000
|
|
|
316,000
|
|
West
|
5,910
|
|
|
5,608
|
|
|
2,832,993
|
|
|
2,617,393
|
|
|
479,000
|
|
|
467,000
|
|
Other
|
1,657
|
|
|
1,471
|
|
|
788,721
|
|
|
663,247
|
|
|
476,000
|
|
|
451,000
|
|
Total
|
27,372
|
|
|
25,106
|
|
|
$
|
9,953,937
|
|
|
8,888,475
|
|
|
$
|
364,000
|
|
|
354,000
|
|
Of the total new orders listed above, 23 homes with a dollar
value of $9.2 million and an average
sales price of $401,000 represent new
orders from unconsolidated entities for the year ended November 30, 2016, compared to 105 new orders
with a dollar value of $70.2 million
and an average sales price of $669,000 for the year ended November 30, 2015.
LENNAR CORPORATION
AND SUBSIDIARIES
Summary of
Backlog
(Dollars in
thousands, except average sales price)
(unaudited)
|
|
|
November
30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Backlog:
|
Homes
|
|
Dollar
Value
|
|
Average Sales
Price
|
East (1)
|
3,243
|
|
|
2,852
|
|
|
$
|
1,065,425
|
|
|
928,098
|
|
|
$
|
329,000
|
|
|
325,000
|
|
Central
|
2,321
|
|
|
2,068
|
|
|
821,608
|
|
|
685,750
|
|
|
354,000
|
|
|
332,000
|
|
West
|
1,530
|
|
|
1,354
|
|
|
748,488
|
|
|
671,524
|
|
|
489,000
|
|
|
496,000
|
|
Other (2)
|
529
|
|
|
372
|
|
|
256,017
|
|
|
192,379
|
|
|
484,000
|
|
|
517,000
|
|
Total
|
7,623
|
|
|
6,646
|
|
|
$
|
2,891,538
|
|
|
2,477,751
|
|
|
$
|
379,000
|
|
|
373,000
|
|
Of the total homes in backlog listed above, 30 homes with a
backlog dollar value of $16.0 million
and an average sales price of $533,000 represent the backlog from
unconsolidated entities at November 30, 2016, compared to 89
homes with a backlog dollar value of $62.4
million and an average sales price of $701,000 at November 30, 2015.
(1)
|
During the year ended
November 30, 2016, the Company acquired 110 homes in
backlog.
|
(2)
|
During the year ended
November 30, 2016, the Company acquired 58 homes in
backlog.
|
Lennar's reportable homebuilding segments and all other
homebuilding operations not required to be reported separately have
divisions located in:
East: Florida,
Georgia, Maryland, New
Jersey, North Carolina,
South Carolina and Virginia
Central: Arizona,
Colorado and Texas
West: California and
Nevada
Other: Illinois,
Minnesota, Oregon, Tennessee and Washington
LENNAR CORPORATION
AND SUBSIDIARIES
Supplemental
Data
(Dollars in
thousands)
(unaudited)
|
|
|
November
30,
|
|
2016
|
|
2015
|
Lennar Homebuilding
debt
|
$
|
4,575,977
|
|
|
5,025,130
|
|
Stockholders'
equity
|
7,026,042
|
|
|
5,648,944
|
|
Total
capital
|
$
|
11,602,019
|
|
|
10,674,074
|
|
Lennar
Homebuilding debt to total capital
|
39.4
|
%
|
|
47.1
|
%
|
|
|
|
|
Lennar Homebuilding
debt
|
$
|
4,575,977
|
|
|
5,025,130
|
|
Less: Lennar
Homebuilding cash and cash equivalents
|
1,050,138
|
|
|
893,408
|
|
Net Lennar
Homebuilding debt
|
$
|
3,525,839
|
|
|
4,131,722
|
|
Net Lennar
Homebuilding debt to total capital (1)
|
33.4
|
%
|
|
42.2
|
%
|
|
|
(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-fourth-quarter-eps-of-134-300380792.html
SOURCE Lennar Corporation