UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549


FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of earliest event reported): July 23, 2015


PULTEGROUP, INC.
(Exact name of registrant as specified in its Charter)

Michigan
1-9804
38-2766606
(State or other jurisdiction
(Commission
(IRS Employer
of incorporation)
File Number)
Identification No.)


3350 Peachtree Road NE, Suite 150, Atlanta, Georgia 30326
(Address of principal executive offices) (Zip Code)


Registrant's telephone number, including area code (404) 978-6400


____________________________________________________
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

_     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

_    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

_    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

_    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))










ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On July 23, 2015, PulteGroup, Inc. issued a press release announcing its financial results for its second quarter ended June 30, 2015. A copy of this earnings press release is furnished with this Current Report on Form 8-K and is incorporated in Item 2.02 by reference.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

99.1    Second Quarter 2015 earnings press release dated July 23, 2015.

The information in Item 2.02 of this Current Report on Form 8-K, including the earnings press release incorporated in such Item 2.02, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be incorporated by reference in any filing under the Securities Act of 1933, except as expressly set forth by specific reference in such filing.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

                                
 
 
PULTEGROUP, INC.
 
 
 
 
 
 
 
 
 
 
 
 
Date:
July 23, 2015
 
By:
/s/ Steven M. Cook
 
 
 
 
Name:
Steven M. Cook
 
 
 
 
Title:
Senior Vice President,
 
 
 
 
 
General Counsel
 
 
 
 
 
and Secretary
 
 
 
 
 
 










 


FOR IMMEDIATE RELEASE
Company Contact
 
Investors: Jim Zeumer
 
(404) 978-6434
 
          Email: jim.zeumer@pultegroup.com
 
 

PULTEGROUP REPORTS SECOND QUARTER 2015 FINANCIAL RESULTS

Reported Q2 Net Income of $103 Million, or $0.28 Per Share, Inclusive of a $0.05 Per Share Benefit Relating to a Legal Settlement in the Period
Home Sale Gross Margin of 23.3%, Up 60 Basis Points From Q1 2015
Dollar Value of Net New Orders Increased 11% to $1.8 Billion; Units Up 7% to 5,118 Homes
Q2 Backlog of 8,998 Homes Valued at $3.1 Billion, Highest Values Since 2007
Company Repurchased $213 Million of Stock and Retired $238 Million of Debt in the Quarter

ATLANTA - July 23, 2015 - PulteGroup, Inc. (NYSE: PHM) announced today financial results for its second quarter ended June 30, 2015. For the quarter, the Company reported net income of $103 million, or $0.28 per share, including a pretax benefit of $27 million, or $0.05 per share, resulting from a legal settlement in the period. Prior year net income of $42 million, or $0.11 per share, included pretax charges of $88 million, or $0.14 per share, for insurance reserves and office relocation costs.

“We are very pleased with market conditions as solid buyer demand helped to drive an 11% increase in the value of new orders to $1.8 billion, our highest quarterly order value since 2007,” said Richard J. Dugas, Jr., Chairman, President and Chief Executive Officer of PulteGroup. “Within this positive demand environment, we continue to demonstrate disciplined capital allocation consistent with our Value Creation strategy by growing our land and community pipeline, while simultaneously paying down $238 million of debt and returning $243 million to shareholders through share repurchases and dividends.

“Demand trends experienced throughout the first half of 2015 demonstrate that the recovery in U.S. housing remains on track and continues to be supported by an improving economy, better employment, rising consumer confidence and a low interest rate environment. With our strong margins and a backlog of almost 9,000 sold homes to be built, PulteGroup is extremely well positioned to capitalize on these favorable conditions and continue delivering outstanding financial results in the coming quarters.”

Second Quarter Results

Home sale revenues for the second quarter totaled $1.2 billion, which is unchanged from the prior year. Revenues for the period reflect a 1% increase in average selling price to $332,000, offset by a 1% decrease in closings to 3,744 homes.

The Company’s second quarter home sale gross margin was 23.3%, an increase of 60 basis points from the first quarter of 2015 and a decrease of 30 basis points from the comparable prior year period. Homebuilding SG&A expense for the quarter was $130 million, or 10.5% of home sale revenues, compared with $230 million, or 18.4% last year. Second quarter 2015 SG&A includes a benefit of $27 million relating to a legal settlement, whereas prior year SG&A included charges of $88 million for insurance reserves and office relocation costs.


1



The value of net new orders for the second quarter increased 11% to $1.8 billion. On a unit basis, net new orders for the period increased 7% to 5,118 homes. The Company operated out of 630 communities in the quarter, an increase of 7% from the second quarter of 2014.

PulteGroup's quarter-end backlog was 8,998 homes valued at $3.1 billion, compared with a prior year backlog of 8,179 homes with a value of $2.8 billion. The average price of homes in backlog was $343,000 which is up 1% over last year and up 3% from the average selling price of homes delivered in the second quarter.

The Company's financial services operations reported second quarter pretax income of $10 million compared with $9 million in 2014. Mortgage capture rate for the quarter was 83%, compared with 80% in the prior year.

During the quarter, PulteGroup repurchased 10.7 million shares of common stock for $213 million, or an average price of $19.90 per share. The Company also used available cash to retire $238 million of bonds which matured during the second quarter. The Company ended the period with $478 million of cash.

A conference call discussing PulteGroup's second quarter 2015 results is scheduled for Thursday, July 23, 2015, at 8:30 a.m. Eastern Time. Interested investors can access the live webcast via PulteGroup's corporate website at www.pultegroupinc.com.

Forward-Looking Statements

This press release includes “forward-looking statements.” These statements are subject to a number of risks, uncertainties and other factors that could cause our actual results, performance, prospects or opportunities, as well as those of the markets we serve or intend to serve, to differ materially from those expressed in, or implied by, these statements. You can identify these statements by the fact that they do not relate to matters of a strictly factual or historical nature and generally discuss or relate to forecasts, estimates or other expectations regarding future events. Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “may,” “can,” “could,” “might,” “will” and similar expressions identify forward-looking statements, including statements related to expected operating and performing results, planned transactions, planned objectives of management, future developments or conditions in the industries in which we participate and other trends, developments and uncertainties that may affect our business in the future.

Such risks, uncertainties and other factors include, among other things: interest rate changes and the availability of mortgage financing; continued volatility in the debt and equity markets; competition within the industries in which PulteGroup operates; the availability and cost of land and other raw materials used by PulteGroup in its homebuilding operations; the impact of any changes to our strategy in responding to the cyclical nature of the industry, including any changes regarding our land positions; the availability and cost of insurance covering risks associated with PulteGroup's businesses; shortages and the cost of labor; weather related slowdowns; slow growth initiatives and/or local building moratoria; governmental regulation directed at or affecting the housing market, the homebuilding industry or construction activities; uncertainty in the mortgage lending industry, including revisions to underwriting standards and repurchase requirements associated with the sale of mortgage loans; the interpretation of or changes to tax, labor and environmental laws; economic changes nationally or in PulteGroup's local markets, including inflation, deflation, changes in consumer confidence and preferences and the state of the market for homes in general; legal or regulatory proceedings or claims; required accounting changes; terrorist acts and other acts of war; and other factors of national, regional and global scale, including those of a political, economic, business and competitive nature. See PulteGroup's Annual Report on Form 10-K for the fiscal year ended December 31, 2014, and other public filings with the Securities and Exchange Commission (the “SEC”) for a further discussion of these and other risks and uncertainties applicable to our businesses. PulteGroup undertakes no duty to update any forward-looking statement, whether as a result of new information, future events or changes in PulteGroup's expectations.




2



About PulteGroup

PulteGroup, Inc. (NYSE: PHM), based in Atlanta, GA, is one of America's largest homebuilding companies with operations in approximately 50 markets throughout the country. Through its brand portfolio that includes Centex, Pulte Homes, Del Webb and DiVosta Homes, the Company is one of the industry's most versatile homebuilders able to meet the needs of multiple buyer groups and respond to changing consumer demand. PulteGroup conducts extensive research to provide homebuyers with innovative solutions and consumer inspired homes and communities to make lives better.

For more information about PulteGroup, Inc. and PulteGroup brands, go to www.pultegroupinc.com; www.pulte.com; www.centex.com; www.delwebb.com and www.divosta.com.

# # #





3




PulteGroup, Inc.
Consolidated Results of Operations
($000's omitted, except per share data)
(Unaudited)
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2015
 
2014
 
2015
 
2014
Revenues:
 
 
 
 
 
 
 
Homebuilding
 
 
 
 
 
 
 
Home sale revenues
$
1,243,077

 
$
1,246,462

 
$
2,331,235

 
$
2,334,477

Land sale revenues
6,460

 
8,527

 
24,002

 
14,511

 
1,249,537

 
1,254,989

 
2,355,237

 
2,348,988

Financial Services
30,754

 
31,198

 
58,352

 
56,093

Total revenues
1,280,291

 
1,286,187

 
2,413,589

 
2,405,081

 
 
 
 
 
 
 
 
Homebuilding Cost of Revenues:
 
 
 
 
 
 
 
Home sale cost of revenues
953,280

 
952,692

 
1,794,425

 
1,781,295

Land sale cost of revenues
5,312

 
6,832

 
18,691

 
11,843

 
958,592

 
959,524

 
1,813,116

 
1,793,138

Financial Services expenses
20,767

 
22,114

 
43,308

 
25,436

Selling, general and administrative expenses
130,119

 
229,767

 
291,431

 
374,655

Other expense, net
4,998

 
9,324

 
6,134

 
23,155

Interest income
(856
)
 
(1,115
)
 
(1,955
)
 
(2,226
)
Interest expense
208

 
203

 
395

 
416

Equity in earnings of unconsolidated entities
(1,164
)
 
(1,311
)
 
(2,271
)
 
(7,202
)
Income before income taxes
167,627

 
67,681

 
263,431

 
197,709

Income tax expense
64,303

 
25,801

 
105,136

 
81,010

Net income
$
103,324

 
$
41,880

 
$
158,295

 
$
116,699

 
 
 
 
 
 
 
 
Per share:
 
 
 
 
 
 
 
Basic earnings
$
0.28

 
$
0.11

 
$
0.43

 
$
0.31

Diluted earnings
$
0.28

 
$
0.11

 
$
0.43

 
$
0.30

Cash dividends declared
$
0.08

 
$
0.05

 
$
0.16

 
$
0.10

 
 
 
 
 
 
 
 
Number of shares used in calculation:
 
 
 
 
 
 
 
Basic
361,009

 
376,072

 
363,863

 
377,410

Effect of dilutive securities
3,232

 
3,592

 
3,297

 
3,703

Diluted
364,241

 
379,664

 
367,160

 
381,113



4




PulteGroup, Inc.
Condensed Consolidated Balance Sheets
($000's omitted)
(Unaudited)
 
 
 
 
 
June 30,
2015
 
December 31,
2014
 
 
 
 
ASSETS
 
 
 
 
 
 
 
Cash and equivalents
$
460,361

 
$
1,292,862

Restricted cash
17,174

 
16,358

House and land inventory
4,888,560

 
4,392,100

Land held for sale
88,513

 
101,190

Land, not owned, under option agreements
98,264

 
30,186

Residential mortgage loans available-for-sale
269,544

 
339,531

Investments in unconsolidated entities
40,232

 
40,368

Other assets
561,034

 
513,032

Intangible assets
116,665

 
123,115

Deferred tax assets, net
1,617,609

 
1,720,668

 
$
8,157,956

 
$
8,569,410

 
 
 
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
 
 
 
 
 
 
 
Liabilities:
 
 
 
Accounts payable
$
290,436

 
$
270,516

Customer deposits
217,315

 
142,642

Accrued and other liabilities
1,292,321

 
1,343,774

Income tax liabilities
48,774

 
48,722

Financial Services debt
119,271

 
140,241

Senior notes
1,583,580

 
1,818,561

 
3,551,697

 
3,764,456

 
 
 
 
Shareholders' equity
4,606,259

 
4,804,954

 
 
 
 
 
$
8,157,956

 
$
8,569,410



5



PulteGroup, Inc.
Consolidated Statements of Cash Flows
($000's omitted)
(Unaudited)
 
Six Months Ended
 
June 30,
 
2015
 
2014
Cash flows from operating activities:
 
 
 
Net income
$
158,295

 
$
116,699

Adjustments to reconcile net income to net cash flows provided by (used in)
      operating activities:
 
 
 
Deferred income tax expense
103,059

 
85,028

Depreciation and amortization
21,853

 
18,904

Share-based compensation expense
14,654

 
16,797

Equity in earnings of unconsolidated entities
(2,271
)
 
(7,202
)
Distributions of earnings from unconsolidated entities
1,500

 
4,777

Loss on debt retirements

 
8,584

Other non-cash, net
10,090

 
6,649

Increase (decrease) in cash due to:
 
 
 
Restricted cash
(4,526
)
 
(726
)
Inventories
(485,676
)
 
(249,861
)
Residential mortgage loans available-for-sale
70,123

 
64,672

Other assets
(57,054
)
 
(15,709
)
Accounts payable, accrued and other liabilities
(21,202
)
 
38,539

Income tax liabilities
52

 
(12,869
)
Net cash provided by (used in) operating activities
(191,103
)
 
74,282

Cash flows from investing activities:
 
 
 
Distributions from unconsolidated entities
906

 
7,577

Investments in unconsolidated entities

 
(9
)
Net change in loans held for investment
9,634

 
(6,791
)
Change in restricted cash related to letters of credit
3,710

 
(28,166
)
Proceeds from the sale of property and equipment
400

 
98

Capital expenditures
(23,115
)
 
(33,021
)
Net cash provided by (used in) investing activities
(8,465
)
 
(60,312
)
Cash flows from financing activities:
 
 
 
Financial Services borrowings (repayments)
(20,970
)
 
(47,158
)
Other borrowings (repayments)
(237,994
)
 
(240,133
)
Stock option exercises
7,222

 
5,789

Share repurchases
(322,066
)
 
(103,711
)
Dividends paid
(59,125
)
 
(38,152
)
Net cash provided by (used in) financing activities
(632,933
)
 
(423,365
)
Net increase (decrease) in cash and equivalents
(832,501
)
 
(409,395
)
Cash and equivalents at beginning of period
1,292,862

 
1,580,329

Cash and equivalents at end of period
$
460,361

 
$
1,170,934

 
 
 
 
Supplemental Cash Flow Information:
 
 
 
Interest paid (capitalized), net
$
(1,911
)
 
$
(328
)
Income taxes paid (refunded), net
$
(1,685
)
 
$
(2,487
)


6




PulteGroup, Inc.
Segment Data
($000's omitted)
(Unaudited)
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2015
 
2014
 
2015
 
2014
HOMEBUILDING:
 
 
 
 
 
 
 
Home sale revenues
$
1,243,077

 
$
1,246,462

 
$
2,331,235

 
$
2,334,477

Land sale revenues
6,460

 
8,527

 
24,002

 
14,511

Total Homebuilding revenues
1,249,537

 
1,254,989

 
2,355,237

 
2,348,988

 
 
 
 
 
 
 
 
Home sale cost of revenues
953,280

 
952,692

 
1,794,425

 
1,781,295

Land sale cost of revenues
5,312

 
6,832

 
18,691

 
11,843

Selling, general and administrative expenses
130,119

 
229,767

 
291,431

 
374,655

Equity in earnings of unconsolidated entities
(1,164
)
 
(1,287
)
 
(2,271
)
 
(7,157
)
Other expense, net
4,998

 
9,324

 
6,134

 
23,155

Interest income, net
(648
)
 
(912
)
 
(1,560
)
 
(1,810
)
Income before income taxes
$
157,640

 
$
58,573

 
$
248,387

 
$
167,007

 
 
 
 
 
 
 
 
FINANCIAL SERVICES:
 
 
 
 
 
 
 
Income before income taxes
$
9,987

 
$
9,108

 
$
15,044

 
$
30,702

 
 
 
 
 
 
 
 
CONSOLIDATED:
 
 
 
 
 
 
 
Income before income taxes
$
167,627

 
$
67,681

 
$
263,431

 
$
197,709



7



PulteGroup, Inc.
Segment Data, continued
($000's omitted)
(Unaudited)
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2015
 
2014
 
2015
 
2014
 
 
 
 
 
 
 
 
Home sale revenues
$
1,243,077

 
$
1,246,462

 
$
2,331,235

 
$
2,334,477

 
 
 
 
 
 
 
 
Closings - units
 
 
 
 
 
 
 
Northeast
316

 
346

 
564

 
689

Southeast
772

 
785

 
1,384

 
1,432

Florida
597

 
623

 
1,198

 
1,190

Texas
754

 
885

 
1,500

 
1,666

North
828

 
678

 
1,563

 
1,308

Southwest
477

 
481

 
900

 
949

 
3,744

 
3,798

 
7,109

 
7,234

Average selling price
$
332

 
$
328

 
$
328

 
$
323

 
 
 
 
 
 
 
 
Net new orders - units
 
 
 
 
 
 
 
Northeast
443

 
380

 
880

 
824

Southeast
1,041

 
880

 
1,979

 
1,704

Florida
805

 
774

 
1,716

 
1,624

Texas
993

 
1,139

 
2,110

 
2,311

North
1,084

 
988

 
2,080

 
1,880

Southwest
752

 
617

 
1,492

 
1,298

 
5,118

 
4,778

 
10,257

 
9,641

Net new orders - dollars (a)
$
1,766,848

 
$
1,594,408

 
$
3,475,238

 
$
3,202,814

 
 
 
 
 
 
 
 
Unit backlog
 
 
 
 
 
 
 
Northeast
 
 
 
 
777

 
756

Southeast
 
 
 
 
1,563

 
1,325

Florida
 
 
 
 
1,520

 
1,347

Texas
 
 
 
 
1,883

 
1,895

North
 
 
 
 
1,979

 
1,785

Southwest
 
 
 
 
1,276

 
1,071

 
 
 
 
 
8,998

 
8,179

Dollars in backlog
 
 
 
 
$
3,087,862

 
$
2,770,134

 
 
 
 
 
 
 
 

(a)
Net new order dollars represent a composite of new order dollars combined with other movements of the dollars in backlog related to cancellations and change orders.

8



    
PulteGroup, Inc.
Segment Data, continued
($000's omitted)
(Unaudited)
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2015
 
2014
 
2015
 
2014
MORTGAGE ORIGINATIONS:
 
 
 
 
 
 
 
Origination volume
2,507

 
2,469

 
4,623

 
4,583

Origination principal
$
635,153

 
$
597,273

 
$
1,149,941

 
$
1,092,802

Capture rate
83.4
%
 
80.3
%
 
82.5
%
 
79.3
%


Supplemental Data
($000's omitted)
(Unaudited)
 
 
 
 
 
 
 
 
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2015
 
2014
 
2015
 
2014
 
 
 
 
 
 
 
 
Interest in inventory, beginning of period
$
166,887

 
$
225,619

 
$
167,638

 
$
230,922

Interest capitalized
31,296

 
31,455

 
62,099

 
66,768

Interest expensed
(33,799
)
 
(46,471
)
 
(65,353
)
 
(87,087
)
Interest in inventory, end of period
$
164,384

 
$
210,603

 
$
164,384

 
$
210,603




9
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