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HomeInvestmentsTaylor Morrison Reports Fourth Quarter and Full Year 2023 Results

Taylor Morrison Reports Fourth Quarter and Full Year 2023 Results

SCOTTSDALE, Ariz., Feb. 14, 2024 /PRNewswire/ — Taylor Morrison Home Corporation (NYSE: TMHC), a leading national land developer and homebuilder, announced results for the fourth quarter and year ended December 31, 2023. Reported net income in the fourth quarter was $173 million, or $1.58 per diluted share while adjusted net income was $223 million, or $2.05 per diluted share. For the full year 2023, reported net income was $769 million, or $6.98 per diluted share, while adjusted net income was $830 million, or $7.54 per diluted share.

Fourth quarter 2023 highlights included the following:

  • Net sales orders increased 30% to 2,361, driven by a monthly absorption pace of 2.4 per community
  • Home closings revenue of $1.9 billion, driven by 3,190 home closings at an average price of $607,000
  • Home closings gross margin of 24.1%
  • 72,362 homebuilding lots owned and controlled, representing 6.3 years of total supply, of which 3.0 years was owned

Full year 2023 highlights included the following:

  • Net sales orders increased 14% to 10,830, driven by a monthly absorption pace of 2.8 per community
  • Home closings revenue of $7.2 billion, driven by 11,495 home closings at an average price of $623,000
  • Home closings gross margin of 23.9% and adjusted home closings gross margin of 24.0%
  • Repurchased 2.8 million common shares for $128 million
  • Homebuilding debt-to-capitalization of 26.0% on a gross basis and 16.8% net of $799 million of unrestricted cash
  • Total liquidity of $1.8 billion

“Our team’s strong fourth quarter execution wrapped up another tremendous year for Taylor Morrison. In total, we delivered 11,495 homes to generate $7.2 billion of homebuilding revenue at a healthy adjusted home closings gross margin of 24.0%, driving adjusted earnings of $7.54 per diluted share. Our earnings combined with $889 million of share repurchases over the last four years drove our book value per share to a new high of $49, which was up 15% from a year ago and 53% from two years ago,” said Sheryl Palmer, Taylor Morrison Chairman and CEO.

“While we faced significant headwinds from rising interest rates, economic uncertainty and global unrest, our business displayed the resiliency we have strategically positioned it for following years of intentional growth, transformative M&A integrations, and tireless commitment to streamlining and optimizing our operational abilities. We strongly believe that our diversification across buyer groups ranging from entry-level, move-up and resort lifestyle combined with our emphasis on high-quality community locations are critical differentiators that enhance our bottom-line potential, growth opportunities and risk mitigation throughout housing’s inevitable ebbs and flows as demonstrated with our results through a volatile fourth quarter.”

Palmer continued, “Our top priority as we move ahead is reaccelerating our growth now that we believe that we have firmly established the operational efficiency required for outsized market share gains. In 2024, we expect to deliver at least 12,000 home closings at a home closings gross margin of 23.0% to 23.5%, followed by approximately 10% closings growth in 2025 and thereafter. Our $1.8 billion land investment in 2023 was focused on supporting these growth aspirations, and with one of the strongest balance sheets in our company’s history, we are well positioned to continue investing with an accretive, disciplined approach in 2024 with an initial planned land spend in the range of $2.3 billion to $2.5 billion. In addition to driving growth in the years ahead, we also expect to repurchase approximately $300 million of common stock in 2024, further enhancing our shareholder returns.”

Business Highlights (All comparisons are of the current quarter to the prior-year period, unless indicated.)

Homebuilding

  • Home closings revenue declined 19% to $1.9 billion, driven by a 16% decrease in home closings to 3,190 and a 3% decrease in average closing price to $607,000.
  • Home closings gross margin increased 60 basis points year over year to 24.1%. In the fourth quarter of 2022, home closings gross margin included an inventory impairment of $25 million. Excluding this charge, the adjusted home closings gross margin in the fourth quarter of 2022 was 24.5%. There was no similar charge taken in the fourth quarter of 2023.
  • Net sales orders increased 30% to 2,361, driven by a 29% increase in the monthly absorption pace to 2.4 per community and a 1% increase in ending community count to 327. Average net sales order price increased 9% to $629,000.
  • SG&A as a percentage of home closings revenue increased 240 basis points to 9.7% from the record low of 7.3% a year ago. The reduced leverage was primarily due to lower home closings revenue, higher performance-based compensation expense and external broker commissions.
  • Cancellations equaled 11.6% of gross orders, down from 24.4% a year ago. This was consistent with historic norms.
  • Backlog at quarter end was 5,289 homes with a sales value of $3.6 billion. Backlog customer deposits averaged approximately $62,000, or 9%, per home.

Land Portfolio

  • Homebuilding land acquisition and development spend totaled $537 million in the fourth quarter, up from $373 million a year ago. Development-related spend accounted for 42% of the fourth quarter total versus 64% a year ago.
  • To provide greater clarity into our lot position and improve comparability to some of our peers, we adjusted our methodology for calculating owned and controlled lots as of December 31, 2023. Specific to owned lots, we have excluded lots that have begun vertical construction. Those lots are defined separately as homes in inventory. With regard to controlled lots, we have expanded our definition to include those lots under contract with an earnest money deposit that have not yet been formally approved by our investment committee to offer a more complete look at our lot pipeline. All presented periods have been recast under the new methodology.
  • Homebuilding lot supply was 72,362 owned and controlled homesites, down from 74,787 a year ago and 74,794 lots two years ago.
  • Controlled homebuilding lots as a share of total lot supply was 53%, up from 51% a year ago and 49% two years ago.
  • Based on trailing twelve-month home closings, total homebuilding lots represented 6.3 years of total supply, of which 3.0 years was owned. This compared to 5.9 years of total supply and 2.9 years of owned supply at year-end 2022 and 5.5 years of total supply and 2.8 years of owned supply at year-end 2021.

Financial Services

  • The mortgage capture rate increased to 86%, up from 78% a year ago.
  • Borrowers had an average credit score of 751 and debt-to-income ratio of 40%.

Balance Sheet

  • At quarter end, total liquidity was approximately $1.8 billion, including $799 million of unrestricted cash and $1.1 billion of total capacity on the Company’s revolving credit facilities, which were undrawn outside of normal letters of credit.
  • The gross homebuilding debt-to-capital ratio was 26.0%, down from 32.0% a year ago. Including $799 million of unrestricted cash on hand, the net homebuilding debt-to-capital ratio was 16.8%, down from 24.0% a year ago.
  • The Company repurchased 2.8 million shares for $128 million in 2023, including approximately 500,000 shares for $24 million in the fourth quarter. At quarter end, the Company had $494 million remaining on its share repurchase authorization.

Business Outlook

First Quarter 2024

  • Home closings are expected to be approximately 2,700
  • Average closing price is expected to be around $600,000
  • Home closings gross margin is expected to be between 23.0% to 23.5%
  • Ending active community count is expected to be between 320 to 325
  • Effective tax rate is expected to be approximately 25%
  • Diluted share count is expected to be approximately 108 million

Full Year 2024

  • Home closings are expected to be at least 12,000
  • Average closing price is expected to be around $600,000
  • Home closings gross margin is expected to be between 23.0% to 23.5%
  • Ending active community count is expected to be between 320 to 325
  • SG&A as a percentage of home closings revenue is expected to be in the high-9% range
  • Effective tax rate is expected to be approximately 25%
  • Diluted share count is expected to be approximately 109 million
  • Land and development spend is expected to be between $2.3 billion to $2.5 billion

Quarterly Financial Comparison

(Dollars in thousands)


Q4 2023



Q4 2022



Q4 2023 vs. Q4 2022


Total Revenue


$

2,019,865



$

2,492,126




(19.0)

%

Home Closings Revenue


$

1,937,632



$

2,378,167




(18.5)

%

Home Closings Gross Margin


$

466,980



$

558,457




(16.4)

%




24.1

%



23.5

%


60 bps increase


 Adjusted Home Closings Gross Margin


$

466,980



$

583,327




(19.9)

%




24.1

%



24.5

%


40 bps decrease


 SG&A


$

188,212



$

173,357




8.6

%

% of Home Closings Revenue



9.7

%



7.3

%


240 bps increase


Annual Financial Comparison

(Dollars in thousands)


2023



2022



2023 vs. 2022


Total Revenue


$

7,417,831



$

8,224,917




(9.8)

%

Home Closings Revenue


$

7,158,857



$

7,889,371




(9.3)

%

Home Closings Gross Margin


$

1,707,456



$

1,984,913




(14.0)

%




23.9

%



25.2

%


130 bps decrease


Adjusted Home Closings Gross Margin


$

1,719,247



$

2,009,783




(14.5)

%




24.0

%



25.5

%


150 bps decrease


SG&A


$

698,707



$

643,212




8.6

%

% of Home Closings Revenue



9.8

%



8.2

%


160 bps increase














Earnings Conference Call Webcast

A public webcast to discuss the Company’s earnings will be held later today at 8:30 a.m. ET. A live audio webcast of the conference call will be available on Taylor Morrison’s website at www.taylormorrison.com on the Investor Relations portion of the site under the Events & Presentations tab. For call participants, the dial-in number is (833) 470-1428 and conference ID is 791610. The call will be recorded and available for replay on the Company’s website.

About Taylor Morrison

Headquartered in Scottsdale, Arizona, Taylor Morrison is one of the nation’s leading homebuilders and developers. We serve a wide array of consumers from coast to coast, including first-time, move-up and resort lifestyle homebuyers and renters under our family of brands—including Taylor Morrison, Esplanade, Darling Homes Collection by Taylor Morrison and Yardly. From 2016-2024, Taylor Morrison has been recognized as America’s Most Trusted® Builder by Lifestory Research. Our strong commitment to sustainability, our communities, and our team is highlighted in our latest Environmental, Social, and Governance (ESG) Report on our website.

Forward-Looking Statements

This earnings summary 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 “”anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “may,” “will,” “can,” “could,” “might,” “should” and similar expressions identify forward-looking statements, including statements related to expected financial, operating and performance 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: inflation or deflation; changes in general and local economic conditions; slowdowns or severe downturns in the housing market; homebuyers’ ability to obtain suitable financing; increases in interest rates, taxes or government fees; shortages in, disruptions of and cost of labor; higher cancellation rates of existing agreements of sale; competition in our industry; any increase in unemployment or underemployment; the seasonality of our business; the physical impacts of climate change and the increased focus by third-parties on sustainability issues; our ability to obtain additional performance, payment and completion surety bonds and letters of credit; significant home warranty and construction defect claims; our reliance on subcontractors; failure to manage land acquisitions, inventory and development and construction processes; availability of land and lots at competitive prices; decreases in the market value of our land inventory; new or changing government regulations and legal challenges; our compliance with environmental laws and regulations regarding climate change; our ability to sell mortgages we originate and claims on loans sold to third parties; governmental regulation applicable to our financial services and title services business; the loss of any of our important commercial lender relationships; our ability to use deferred tax assets; raw materials and building supply shortages and price fluctuations; our concentration of significant operations in certain geographic areas; risks associated with our unconsolidated joint venture arrangements; information technology failures and data security breaches; costs to engage in and the success of future growth or expansion of our operations or acquisitions or disposals of businesses; costs associated with our defined benefit and defined contribution pension schemes; damages associated with any major health and safety incident; our ownership, leasing or occupation of land and the use of hazardous materials; existing or future litigation, arbitration or other claims; negative publicity or poor relations with the residents of our communities; failure to recruit, retain and develop highly skilled, competent people; utility and resource shortages or rate fluctuations; constriction of the capital markets; risks related to instability in the banking system; risks associated with civil unrest, acts of terrorism, threats to national security, the conflicts in Eastern Europe and the Middle East and other geopolitical events; the scale and scope of current and future public health events, including pandemics and epidemics; any failure of lawmakers to agree on a budget or appropriation legislation to fund the federal government’s operations (also known as a government shutdown), and financial markets’ and businesses’ reactions to any such failure; risks related to our substantial debt and the agreements governing such debt, including restrictive covenants contained in such agreements; our ability to access the capital markets; the risks associated with maintaining effective internal controls over financial reporting; provisions in our charter and bylaws that may delay or prevent an acquisition by a third party; and our ability to effectively manage our expanded operations.

In addition, other such risks and uncertainties may be found in our most recent annual report on Form 10-K and our subsequent quarterly reports filed with the Securities and Exchange Commission (SEC) as such factors may be updated from time to time in our periodic filings with the SEC. We undertake no duty to update any forward-looking statement, whether as a result of new information, future events or changes in our expectations, except as required by applicable law.  

Taylor Morrison Home Corporation

Consolidated Statements of Operations

(In thousands, except per share amounts, unaudited)






Three Months Ended
December 31,



Twelve Months Ended
December 31,




2023



2022



2023



2022


Home closings revenue, net


$

1,937,632



$

2,378,167



$

7,158,857



$

7,889,371


Land closings revenue



29,532




14,419




60,971




81,070


Financial services revenue



43,204




37,072




160,312




135,491


Amenity and other revenue



9,497




62,468




37,691




118,985


          Total revenue



2,019,865




2,492,126




7,417,831




8,224,917


Cost of home closings



1,470,652




1,819,710




5,451,401




5,904,458


Cost of land closings



24,598




13,505




55,218




63,644


Financial services expenses



23,372




17,868




93,990




83,960


Amenity and other expenses



9,139




41,225




34,149




80,489


          Total cost of revenue



1,527,761




1,892,308




5,634,758




6,132,551


Gross margin



492,104




599,818




1,783,073




2,092,366


Sales, commissions and other marketing costs



113,543




118,124




418,134




398,074


General and administrative expenses



74,669




55,232




280,573




245,138


Net (income)/loss from unconsolidated entities



(1,708)




11,198




(8,757)




14,184


Interest (income)/expense, net



(564)




3,851




(12,577)




17,674


Other expense, net



80,884




43,218




87,567




38,497


Loss/(gain) on extinguishment of debt, net



26




(334)




295




(13,876)


Income before income taxes



225,254




368,529




1,017,838




1,392,675


Income tax provision



52,092




93,128




248,097




336,428


Net income before allocation to non-controlling interests



173,162




275,401




769,741




1,056,247


Net income attributable to non-controlling interests



(577)




(70)




(812)




(3,447)


Net income


$

172,585



$

275,331



$

768,929



$

1,052,800


Earnings per common share













Basic


$

1.61



$

2.54



$

7.09



$

9.16


Diluted


$

1.58



$

2.51



$

6.98



$

9.06


Weighted average number of shares of common stock:













Basic



107,227




108,277




108,424




114,982


Diluted



108,969




109,643




110,145




116,221


Taylor Morrison Home Corporation

Condensed Consolidated Balance Sheets

(In thousands, unaudited)




December 31,
2023



December 31,
2022


Assets







Cash and cash equivalents


$

798,568



$

724,488


Restricted cash



8,531




2,147


Total cash



807,099




726,635


Owned inventory



5,473,828




5,346,905


Consolidated real estate not owned



71,618




23,971


Total real estate inventory



5,545,446




5,370,876


Land deposits



203,217




263,356


Mortgage loans held for sale



193,344




346,364


Lease right of use assets



75,203




90,446


Prepaid expenses and other assets, net



290,925




265,392


Other receivables, net



184,518




191,504


Investments in unconsolidated entities



346,192




282,900


Deferred tax assets, net



67,825




67,656


Property and equipment, net



295,121




202,398


Goodwill



663,197




663,197


Total assets


$

8,672,087



$

8,470,724


Liabilities







Accounts payable


$

263,481



$

269,761


Accrued expenses and other liabilities



549,074




490,253


Lease liabilities



84,999




100,174


Customer deposits



326,087




412,092


Estimated development liabilities



27,440




43,753


Senior notes, net



1,468,695




1,816,303


Loans payable and other borrowings



394,943




361,486


Revolving credit facility borrowings







Mortgage warehouse borrowings



153,464




306,072


Liabilities attributable to consolidated real estate not owned



71,618




23,971


Total liabilities


$

3,339,801



$

3,823,865


Stockholders’ Equity







Total stockholders’ equity



5,332,286




4,646,859


Total liabilities and stockholders’ equity


$

8,672,087



$

8,470,724


Homes Closed and Home Closings Revenue, Net:






Three Months Ended December 31,




Homes Closed



Home Closings Revenue, Net



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



1,252




1,612




(22.3)

%


$

712,461



$

916,509




(22.3)

%


$

569



$

569




0.0

%

Central



767




1,082




(29.1)

%



436,080




667,040




(34.6)

%



569




616




(7.6)

%

West



1,171




1,103




6.2

%



789,091




794,618




(0.7)

%



674




720




(6.4)

%

Total



3,190




3,797




(16.0)

%


$

1,937,632



$

2,378,167




(18.5)

%


$

607



$

626




(3.0)

%



Twelve Months Ended December 31,




Homes Closed



Home Closings Revenue, Net



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



4,480




4,764




(6.0)

%


$

2,619,322



$

2,673,951




(2.0)

%


$

585



$

561




4.3

%

Central



3,143




3,359




(6.4)

%



1,935,500




2,014,869




(3.9)

%



616




600




2.7

%

West



3,872




4,524




(14.4)

%



2,604,035




3,200,551




(18.6)

%



673




707




(4.8)

%

Total



11,495




12,647




(9.1)

%


$

7,158,857



$

7,889,371




(9.3)

%


$

623



$

624




(0.2)

%

Net Sales Orders:




Three Months Ended December 31,




Net Sales Orders



Sales Value



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



902




939




(3.9)

%


$

579,540



$

527,898




9.8

%


$

643



$

562




14.4

%

Central



602




310




94.2

%



339,973




184,422




84.3

%



565




595




(5.0)

%

West



857




561




52.8

%



565,747




334,113




69.3

%



660




596




10.7

%

Total



2,361




1,810




30.4

%


$

1,485,260



$

1,046,433




41.9

%


$

629



$

578




8.8

%



Twelve Months Ended December 31,




Net Sales Orders



Sales Value



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



3,968




4,128




(3.9)

%


$

2,366,528



$

2,504,696




(5.5)

%


$

596



$

607




(1.8)

%

Central



2,725




2,289




19.0

%



1,588,169




1,478,528




7.4

%



583




646




(9.8)

%

West



4,137




3,070




34.8

%



2,784,803




2,212,999




25.8

%



673




721




(6.7)

%

Total



10,830




9,487




14.2

%


$

6,739,500



$

6,196,223




8.8

%


$

622



$

653




(4.7)

%

Sales Order Backlog:




As of December 31,




Sold Homes in Backlog



Sales Value



Average Selling Price


(Dollars in thousands)


2023



2022



Change



2023



2022



Change



2023



2022



Change


East



2,071




2,583




(19.8)

%


$

1,480,268



$

1,733,062




(14.6)

%


$

715



$

671




6.6

%

Central



1,299




1,717




(24.3)

%



864,162




1,211,493




(28.7)

%



665




706




(5.8)

%

West



1,919




1,654




16.0

%



1,300,200




1,119,432




16.1

%



678




677




0.1

%

Total



5,289




5,954




(11.2)

%


$

3,644,630



$

4,063,987




(10.3)

%


$

689



$

683




0.9

%

Ending Active Selling Communities:




As of



Change




December 31, 2023



December 31, 2022





East



108




106




1.9

%

Central



93




104




(10.6)

%

West



126




114




10.5

%

Total



327




324




0.9

%

Reconciliation of Non-GAAP Financial Measures

In addition to the results reported in accordance with accounting principles generally accepted in the United States (“GAAP”), we provide our investors with supplemental information relating to: (i) adjusted net income and adjusted earnings per common share, (ii) adjusted income before income taxes and related margin, (iii) adjusted home closings gross margin; (iv) EBITDA and adjusted EBITDA and (v) net homebuilding debt to capitalization ratio.

Adjusted net income, adjusted earnings per common share and adjusted income before income taxes and related margin are non-GAAP financial measures that reflect the net income/(loss) available to the Company excluding, to the extent applicable in a given period, the impact of inventory impairment charges, impairment of investment in unconsolidated entities, pre-acquisition abandonment charges, gains/losses on land transfers to joint ventures, extinguishment of debt, net, and legal settlements that the Company deems not to be in the ordinary course of business and in the case of adjusted net income and adjusted earnings per common share, the tax impact due to such items. EBITDA and Adjusted EBITDA are non-GAAP financial measures that measure performance by adjusting net income before allocation to non-controlling interests to exclude, as applicable, interest expense/(income), net, amortization of capitalized interest, income taxes, depreciation and amortization (EBITDA), non-cash compensation expense, if any, inventory impairment charges, impairment of investment in unconsolidated entities, pre-acquisition abandonment charges, gains/losses on land transfers to joint ventures, extinguishment of debt, net and legal settlements that the Company deems not to be in the ordinary course of business. Net homebuilding debt to capitalization ratio is a non-GAAP financial measure we calculate by dividing (i) total debt, plus unamortized debt issuance cost/(premium), net, and less mortgage warehouse borrowings, net of unrestricted cash and cash equivalents (“net homebuilding debt”), by (ii) total capitalization (the sum of net homebuilding debt and total stockholders’ equity). Adjusted home closings gross margin is a non-GAAP financial measure based on GAAP home closings gross margin (which is inclusive of capitalized interest), excluding inventory impairment charges.

Beginning with the fourth quarter of 2023, we are excluding the impact of legal settlements that the Company deems not to be in the ordinary course of business from our calculation of Adjusted Net Income and Adjusted EBITDA, as we believe such legal settlements are not characteristic of our underlying operating performance.  The Company believes the exclusion of such amounts is useful to investors as it assists in the comparison of our operational performance across different periods.  While all previously reported periods have been conformed to the new definition, we determined that no further adjustments to prior periods were necessary under the new definition. 

Management uses these non-GAAP financial measures to evaluate our performance on a consolidated basis, as well as the performance of our regions, and to set targets for performance-based compensation.  We also use the ratio of net homebuilding debt to total capitalization as an indicator of overall leverage and to evaluate our performance against other companies in the homebuilding industry.  In the future, we may include additional adjustments in the above-described non-GAAP financial measures to the extent we deem them appropriate and useful to management and investors.

We believe that adjusted net income, adjusted earnings per common share, adjusted income before income taxes and related margin, as well as EBITDA and adjusted EBITDA, are useful for investors in order to allow them to evaluate our operations without the effects of various items we do not believe are characteristic of our ongoing operations or performance and also because such metrics assist both investors and management in analyzing and benchmarking the performance and value of our business. Adjusted EBITDA also provides an indicator of general economic performance that is not affected by fluctuations in interest rates or effective tax rates, levels of depreciation or amortization, or unusual items. Because we use the ratio of net homebuilding debt to total capitalization to evaluate our performance against other companies in the homebuilding industry, we believe this measure is also relevant and useful to investors for that reason. We believe that adjusted home closings gross margin is useful to investors because it allows investors to evaluate the performance of our homebuilding operations without the varying effects of items or transactions we do not believe are characteristic of our ongoing operations or performance.

These non-GAAP financial measures should be considered in addition to, rather than as a substitute for, the comparable U.S. GAAP financial measures of our operating performance or liquidity. Although other companies in the homebuilding industry may report similar information, their definitions may differ. We urge investors to understand the methods used by other companies to calculate similarly-titled non-GAAP financial measures before comparing their measures to ours.

A reconciliation of (i) adjusted net income and adjusted earnings per common share, (ii) adjusted income before income taxes and related margin, (iii) adjusted home closings gross margin; (iv) EBITDA and adjusted EBITDA and (v) net homebuilding debt to capitalization ratio to the comparable GAAP measures is presented below.

Adjusted Net Income and Adjusted Earnings Per Common Share






Three Months Ended
December 31,



Twelve Months Ended
December 31,


(Dollars in thousands, except per share data)


2023



2022



2023



2022


Net income


$

172,585



$

275,331



$

768,929



$

1,052,800


Legal settlements(1)



64,665







64,665





Inventory impairments (2)






24,870




11,791




24,870


Impairment of investment in unconsolidated entities(3)






11,186







14,714


Pre-acquisition abandonment charges(1)



1,176




24,903




4,235




33,240


Gain on land transfers to joint ventures(1)












(14,508)


Loss/(gain) on extinguishment of debt, net(4)



26




(334)




295




(13,876)


Tax impact due to above non-GAAP reconciling items



(15,216)




(14,726)




(19,737)




(10,654)


Adjusted net income


$

223,236



$

321,230



$

830,178



$

1,086,586


Basic weighted average number of  shares



107,227




108,277




108,424




114,982


Adjusted earnings per common share – Basic


$

2.08



$

2.97



$

7.66



$

9.45


Diluted weighted average number of shares



108,969




109,643




110,145




116,221


Adjusted earnings per common share – Diluted


$

2.05



$

2.93



$

7.54



$

9.35


Adjusted Income Before Income Taxes and Related Margin






Three Months Ended
December 31,



Twelve Months Ended
December 31,


(Dollars in thousands)


2023



2022



2023



2022


Income before income taxes


$

225,254



$

368,529



$

1,017,838



$

1,392,675


Legal settlements(1)



64,665







64,665





Inventory impairments(2)






24,870




11,791




24,870


Impairment of investment in unconsolidated entities(3)






11,186







14,714


Pre-acquisition abandonment charges(1)



1,176




24,903




4,235




33,240


Gain on land transfers to joint ventures(1)












(14,508)


Loss/(gain) on extinguishment of debt, net(4)



26




(334)




295




(13,876)


Adjusted income before income taxes


$

291,121



$

429,154



$

1,098,824



$

1,437,115


Total revenue


$

2,019,865



$

2,492,126



$

7,417,831



$

8,224,917


Income before income taxes margin



11.2

%



14.8

%



13.7

%



16.9

%

Adjusted income before income taxes margin



14.4

%



17.2

%



14.8

%



17.5

%

Adjusted Home Closings Gross Margin




Three Months Ended
December 31,



Twelve Months Ended
December 31,


(Dollars in thousands)


2023



2022



2023



2022


Home closings revenue


$

1,937,632



$

2,378,167



$

7,158,857



$

7,889,371


Cost of home closings



1,470,652




1,819,710




5,451,401




5,904,458


Home closings gross margin


$

466,980



$

558,457



$

1,707,456



$

1,984,913


Inventory impairment charges(2)






24,870




11,791




24,870


Adjusted home closings gross margin


$

466,980



$

583,327



$

1,719,247



$

2,009,783


Home closings gross margin as a percentage of home closings revenue



24.1

%



23.5

%



23.9

%



25.2

%

Adjusted home closings gross margin as a percentage of home closings revenue



24.1

%



24.5

%



24.0

%



25.5

%

EBITDA and Adjusted EBITDA Reconciliation






Three Months Ended
December 31,



Twelve Months Ended
December 31,


(Dollars in thousands)


2023



2022



2023



2022


Net income before allocation to non-controlling interests


$

173,162



$

275,401



$

769,741



$

1,056,247


Interest (income)/expense, net



(564)




3,851




(12,577)




17,674


Amortization of capitalized interest



37,491




40,836




134,870




138,460


Income tax provision



52,092




93,128




248,097




336,428


Depreciation and amortization



2,918




2,710




8,976




7,565


EBITDA


$

265,099



$

415,926



$

1,149,107



$

1,556,374


Legal settlements(1)



64,665







64,665





Non-cash compensation expense



7,589




9,427




26,095




26,901


Inventory impairments(2)






24,870




11,791




24,870


Impairment of investment in unconsolidated entities(3)






11,186







14,714


Pre-acquisition abandonment charges(1)



1,176




24,903




4,235




33,240


Gain on land transfers to joint ventures(1)












(14,508)


Loss/(gain) on extinguishment of debt, net(4)



26




(334)




295




(13,876)


Adjusted EBITDA


$

338,555



$

485,978



$

1,256,188



$

1,627,715


Total revenue


$

2,019,865



$

2,492,126



$

7,417,831



$

8,224,917


Net income before allocation to non-controlling interests as a percentage of total revenue



8.6

%



11.1

%



10.4

%



12.8

%

EBITDA as a percentage of total revenue



13.1

%



16.7

%



15.5

%



18.9

%

Adjusted EBITDA as a percentage of total revenue



16.8

%



19.5

%



16.9

%



19.8

%

Debt to Capitalization Ratios Reconciliation




(Dollars in thousands)


As of
December 31,
2023



As of
September 30,
2023



As of
December 31,
2022


Total debt


$

2,017,102



$

1,992,077



$

2,483,861


Plus: unamortized debt issuance cost, net



8,375




8,815




10,767


Less: mortgage warehouse borrowings



(153,464)




(191,645)




(306,072)


Total homebuilding debt


$

1,872,013



$

1,809,247



$

2,188,556


Total equity



5,332,286




5,175,110




4,646,859


Total capitalization


$

7,204,299



$

6,984,357



$

6,835,415


Total homebuilding debt to capitalization ratio



26.0

%



25.9

%



32.0

%

Total homebuilding debt


$

1,872,013



$

1,809,247



$

2,188,556


Less: cash and cash equivalents



(798,568)




(613,811)




(724,488)


Net homebuilding debt


$

1,073,445



$

1,195,436



$

1,464,068


Total equity



5,332,286




5,175,110




4,646,859


Total capitalization


$

6,405,731



$

6,370,546



$

6,110,927


Net homebuilding debt to capitalization ratio



16.8

%



18.8

%



24.0

%



1)

Included in Other expense, net on the Consolidated Statement of Operations

2)

Included in Cost of home closings on the Consolidated Statement of Operations

3)

Included in Net (income)/loss from unconsolidated entities on the Consolidated Statement of Operations

4)

Included in Loss/(gain) on extinguishment of debt, net on the Consolidated Statement of Operations

CONTACT:
Mackenzie Aron, VP Investor Relations
(480) 734-2060
[email protected] 

SOURCE Taylor Morrison

Originally published at https://www.prnewswire.com/news-releases/taylor-morrison-reports-fourth-quarter-and-full-year-2023-results-302061194.html
Images courtesy of https://pixabay.com

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